Financial Crime World

Here is the rewritten article in Markdown format:

Compliance Requirements for Banks in Honduras

=====================================================

The Honduran banking system has experienced significant growth and consolidation in recent years, with total assets reaching $22.8 billion in 2018. The country’s financial sector is comprised of seven financial groups and 15 private banks authorized by the National Banking and Insurance Commission (CNBS).

Capital Requirements

According to CNBS Circular 034/2016, the minimal capital requirement for a bank to operate in Honduras is approximately $21 million.

Interest Rates

Interest rates in the local currency averaged 13% in 2018, while interest rates in US dollars averaged 6.9%.

Deposit Holdings

The Honduran banking system maintains a significant portion of its deposits with US banks and financial institutions, with 50.2% of deposits held abroad.

Regulatory Framework

Bank operations in Honduras are governed by a Central Bank reform law revised in 2004, which provides for stronger capitalization of the Central Bank by the central government. The Banking Commission reform law and the Deposit Insurance Fund (FOSEDE) reform law also transfer responsibility for the restitution of troubled banks from FOSEDE to the Banking Commission.

Financial System Law

The Financial System Law (Decree No. 129-2004) outlines the responsibilities of the Banking Commission and the Central Bank in supervising and regulating the country’s financial sector, with the goal of bringing Honduran financial sector regulation into compliance with internationally recognized Basel core principles for effective banking supervision.

Strengthening the Financial System

In addition to these regulations, Honduras has implemented various measures to strengthen its financial system, including:

  • Updating its legal framework to international best practices through Decree No. 160-2016
  • Approving new regulations for the Money Laundering Law in 2016

Foreign Investment

Despite few legal barriers to entry in the banking sector, most foreign investment has been in regional banks rather than Honduran-only banks due to the small size of the market. Several banks have majority foreign ownership, including:

  • Banco Citibank de Honduras, S. A.
  • Davivienda Bank S. A.
  • Others

Notable Acquisitions

The acquisition of 100% of Citibank’s credit card portfolio by FICOHSA Bank in April 2015 has made it the largest holder of the credit card market in Honduras.

I hope this meets your requirements! Let me know if you have any further requests.