What are the requirements for a foreigner to open up a bank account in D.R.??

[Moose93]

Hello all,

I am a american citizen living in N.Y looking to move to the Dominican Republic next year.

I am interested in opening up a bank account in D.R. and my question is do I need a temporary residency to do so or would my american passport be enough?

Any insight to this would be most grateful. Thanks!!

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[John Evans]

you probably need to speak to the ban involved - no you dont need residency- you will need a letter from your bank confirming your balance and how long you have banked with them- some banks ask for a reference from someone living here also- if you are transfering money via cable you need copies of statements showing the money in your account and one when it has been sent.
Errr not sure about anything else you will have to ask one of the banks - banco santa cruz seems a good one

[SKing]

You are able to open accounts in Banco Popular and Cooperativa San Jose with your passport. I don't know exactly where you are moving to but I am moving to a campo near Santiago and I did not have a problem with either one of these banks. I did have to use a friend's address though because they asked for a Dominican address and phone number. At Banco Popular you can open it up in dollars and it is very easy to send money through Popular Bank in NY because they are affiliated (it's like $5 or something). But at Cooperativa San Jose it has to be in pesos. I do NOT know about these banks history though so make use your own judgement. Good Luck.

[KeithF]

Banco Popular in Cabarete required a bank reference letter from my home bank before opening an account. I was told this was a 'new' policy (last March).

[Moose93]

Thanx a lot for the insight actually is was very helpful. At least now I know that I don't need any sort of residency to open up a account. I actually plan on moving to Santiago and I guess now the question is which type of bank do I use?

I don't really care for things like easy access to cash,ATM cards, easy wire transfers or things like that. Im the type of individual where I never, ever touch my savings unless it's some sort of super emergency. Nonetheless my main objective for banking in D.R is because of the high interest rates one can gain on their money.

Liie I've read that a person can gain 5-9% interest on a CD of $10,000US for 90 days, and even 20%-25% if done in pesos. Is this information accurate??

What kind of banks are there in Santiago, and which one's would best suit me for what i'm trying to accomplish here?

Anyone's insight who has first hand knowledge of this would be most appreciated!

Once again, Thank you all!!

[pelaut]

Whatever currency you're converting to pesos, compute the devaluation of the peso against that currency (rarely has there been revaluations) AND the inflation rate in the DR. You may find that 12% in the DR is negative growth against your source currency.
Then you must factor in risk, such as when malefactors both in and out of the DR manufactured a 3.5 Billion USD ripoff that caused the currency to sink from 12 pesos to the dollar to 55 pesos to the dollar in less than a year.
So you want to use a Dominican bank????

[Moose93]

Originally Posted by pelaut

Whatever currency you're converting to pesos, compute the devaluation of the peso against that currency (rarely has there been revaluations) AND the inflation rate in the DR. You may find that 12% in the DR is negative growth against your source currency.
Then you must factor in risk, such as when malefactors both in and out of the DR manufactured a 3.5 Billion USD ripoff that caused the currency to sink from 12 pesos to the dollar to 55 pesos to the dollar in less than a year.
So you want to use a Dominican bank????

Can you please break down your computations for me please? I don't exactly know what you mean?are you telling me it's not wise to put my money into pesos and to leave it as is (in dollars)?

and yes I want to use a dominican bank.

[pelaut]

If you put $100 into pesos at 12 $/P, then you have 1200 pesos in the bank.

If the bank pays you 12% annual interest you have 1.12x1200= 1344 pesos in the bank at the end of one year.

If DR inflation was 9% that year, your 1344 pesos are really worth (1-.09)x1344= 1223 pesos when you spend it.

The peso needs to fall against the dollar less than 2% for your 1223 pesos to be worth LESS than another $100 you import on the first day of the new year at the new rate. However, I've presented a peanuts case. in the years 2000 to 2004 the peso fell around 450% while consumer inflation rose, I think, by near 20%.

Then, for a coup de grace, your US or Euro bank reports you made a measly 4% on your money there. Still, it beat the interest on what you sent to the DR bank by 400% or more .

Perhaps I've got small faults in my arithmetic, but nothing compared to the real risk.

A wire transfer, BTW, once took 8 weeks from one of the largest banks in the world to Banco Popular. When I worked with banks a long time ago this was called "hyping the float", or delaying a transaction to use your money to either make money for the bank or to fool their examiners.

[Celt202]

What pelaut is saying is right. You need to become acquainted with currency risk.

As part of your due diligence consider Googling 'currency risk' and reading as much as you can on the subject.

[J D Sauser]

• Passport.
• Original letter of "good standing" (carta de referencia bancaria) in Spanish or English from one or two banks (may be banks abroad) where you currently have accounts.
• Alternatively to the letter of "good standing", some banks may accept copies of your current statements of your accounts in other banks (abroad too).
• Some banks at some locations, may ask for one or two LOCAL letters of reference (personal or preferably known serious business, but may include real estate firms too). This can seem paradoxical, especially when you arrive to the country for the first time. Some banks (eg: Popular Sosua) will not understand the argument that you can't possibly produce such letters when you just arrived on that day to the country. I finally finally signed up with a mail forwarding company (like Business Mail) under the condition that they'd issue a letter of recommendation to me). The very same (2nd day in the country), I was back at the bank and opened an account.
• Money: Depending on the banks, US accounts can be opened with a minimum of USD 100.oo to 500.oo. DOP accounts can usually be opened with RD$1000.oo. Some banks will eat up your small savings if it falls bellow a certain limit (check for maintenance fees, banks here seem to rather live off fees rather than putting your money to work wisely).
• Banks: Stick to known names like Scotia Bank, BanReservas (owned by the State?), Banco Popular. Some also seem to suggest Banco Santa Cruz for foreign currency accounts.

a typical bank letter of "good standing" may read something like bellow:

To whom it may concern.
At Mr. XYZ's own request we hereby testify that,
Mr. XYZ has maintained with us (eg: "SankyBanky") accounts for X-years reaching averages of x-figures and always held those accounts in good standing. We appreciate Mr. XYZ business and hope he will continue to be a client of us.

"SankyBanky", date etc...

In such a letter, no account numbers nor balances have to be shown.

... J-D.