Propelling innovation, solvency and efficiency in the Dominican Republic’s banking industry
ABA’s focus on technology, efficiency and best practices has actively contributed to the country’s excellent financial indicators and macroeconomic stability
“Our main goal is to have a banking industry with solvency and strength, one that is indispensable for the economic stability of the Dominican Republic”, says Mrs. Rosanna Ruiz, President of the Association of Multiple Banks of the Dominican Republic, ABA, which brings together the country’s seventeen commercial and multi-service banks, and has made the Dominican banking industry one of the strongest in the region. Their latest indicators don’t lie. A default rate of 1.5%, a solvency rate of 20%, ROA and
ROE at record levels, and over 20% of net worth growth in the last fourteen months.
While ABA’s stabilizing capacity was put to the test throughout 2020’s COVID crisis, remaining operational on all its payments and financial services, as well as restructuring and refinancing 50% of its loan portfolio to relief vulnerable sectors, the majority of ABA’s programs have a long-term vision. On the one hand, ABA aims to have a completely digitized banking industry by optimizing digital financial services for loans and investments, and working on the virtualization of their passive accounts. They are innovating their procedures and making them more cost-efficient with a monetary authority website that will allow the banks to send reports directly to a digital platform shared with the Central Bank and the
Superintendency of Banks.
ABA is also focusing on legislation to find new ways to promote financial inclusion and support SMEs, their mutual loan guarantee association law will allow SMEs to access formal credit in better financial conditions. Similarly, ABA has reached agreements with the Ministry of Education to encourage a nationwide culture of savings with resources like the online ABA classroom, to provide first-rate lessons and free webinars given by international facilitators. Additionally, they are working with local universities on a financial education subscription group so students can be certified, get their first job in the banking industry and reduce staff turnover.
ABA is also promoting inter-institutional agreements with the public sector around money laundering prevention, and is establishing an association of financial intermediaries to reach a monolithic position regarding regulatory, fiscal, and public policy matters. Moreover, been part of the Sustainable Banking Network since 2018 and supported by the International Finance Corporation (IFC), ABA is working towards the adoption of the World Bank’s Green Protocol as a guide of environmentally sustainable practices for Dominican banks.
In 2022, ABA is holding several events that will help attract investors and promote networking like Felaban’s Latin American Foreign Trade Congress (CLACE). ABA is confident all their innovative efforts will continue to bring positive results. As Mrs. Ruiz proudly states, “we have macroeconomic stability in a time when the whole world is unstable. That says a lot about our investment potential and the strength of our financial system.”