With the expectation of having a voice in the discussion of economic matters and, at the same time, seek the adoption of best practices in financial intermediation, a group of international financial entities based in Puerto Rico have organized under the Puerto Rico International Banks Association (ABIPR, by its Spanish acronym).
Although the ABIPR was conceived some three years ago, it could be said that the organization took its first official steps last week at the American International Plaza building, in San Juan’s Golden Mile banking district. There, some two dozen executives from international banking entities (IBEs) and international financial entities (IFEs) based on the island participated in a meeting in which they drew the agenda of the ABIPR for next several months.
Eduardo Colón, president of Advantage Bank, explained that the segment has nowadays matured enough to organize, either with the purpose to contribute in discussions of economic and financial affairs on the island, as well as formalize a program that would allow such entities to adopt and keep up-to-date with the changing regulations in the industry.
“One of the things we will ask for is for regulators to have more resources at their disposal,” said Colón, pointing out that, as the IBE and IFE segment keeps growing, it will become necessary for the Office of the Commissioner of Financial Institutions (OCIF, in Spanish) to have additional tools to properly carry out its role as the industry’s chief supervisor.
According to Colón, there are currently 45 active licenses for IFEs and another 29 for IBEs on the island, with some of them having been established in Puerto Rico for several decades. The segment nowadays employs about 450 professionals in Puerto Rico.
As of last June, per OCIF figures, IBEs on the island generated $172 million in net revenue and managed $51.87 billion in assets. During the same period, IFEs reported $12.1 million in net revenue and had $3.29 billion in assets under their watch, again according to OCIF.
Colón revealed that in 2020, the association will hold an investors’ forum to promote the island’s strengths as a financial center. However, the ABIPR’s current priority is to encourage best practices in order to comply with banking secrecy and anti-money laundering practices, which are issues that have previously cast a shadow on the industry.
Specifically, there have been recent accusations involving an entity, South Bank International, with alleged ties to a Venezuelan money laundering scheme, and a subsequent FBI raid that was carried out last July.
According to Colón, the founding members of the ABIPR are ItalBank, BNC International Banking, Advantage Bank, Activo International Bank, and State Trust International Trust. However, the banker saidhe was confident that more entities will join the organization before year’s end.