Best bank: Banreservas
Dominican Republic president Luis Abinader’s election win was good news for state-controlled bank Banreservas because it ensures stability in senior management, led by the bank’s president Samuel Pereyra, at a time when it is on something of a roll.
The election win also hints at the strong economic performance that all banks in the country have been enjoying, with the financial system showing robust growth across the private and public sectors – and none more so than the country’s best bank, Banreservas. Not only is the bank the biggest and most profitable bank in the country, but it is extending its advantage while playing a key economic development role. And it is also now active outside the Dominican Republic, with the bank opening branch offices in the US to optimize capital and trade flows into the economy.
Internally, the bank can also point many loans that it has disbursed that, while it aims to make a commercial return, are also led by its mission to boost the Dominican economy. These deals include financing major projects in the tourism, real estate, construction and energy sectors. Additionally the bank has established special financing programmes for the supply chain businesses that support these sectors, as well as initiatives that promote financial inclusion and social welfare projects benefiting schools, sports, cultural associations, healthcare organizations and community clubs.
However, these positive social initiatives are not impacting the day-to-day job of growing a profitable and sustainable bank. During 2023 Banreservas achieved a 36.9% market share in terms of market assets and 37.8% of deposits. The non-performing loan ratio fell from 2022’s remarkably low 0.68% (the bank shaved another 2 basis points off this level last year). Total revenues rose 8.1% to $3.8 billion, while the bank’s net interest margin rose to 6.72% from 6.2%, which helped net income to rise 11.3% to $420 million. The bank’s return on equity ended the year on 32.3% and its return on assets ratio came in at 2.35%.
Best international bank: Citi
Citi is the only global financial institution with a physical presence in the Dominican Republic. Last year it worked on a $81.5 million social trade loan to support small and medium-sized enterprises in the country.
Another significant deal saw Citi facilitate a $1.1 billion combined Dominican peso and US dollar bond issue. This was the first peso-linked new issue since 2020 and attracted the highest ever demand for this format, with a 7.6 times oversubscription. This deal also represented the largest combined hard and local currency bond offering ever issued by the Dominican Republic in the global debt markets.
Citi also facilitated the Dominican Republic’s first peso-linked liability management exercise, achieving a record 93% participation – Ps37.2 billion ($629 million) of the targeted Ps40 billion notes.
The bank also made significant progress in financial capability and youth economic opportunities programmes. Key achievements included a $500,000 grant to Heartland Alliance Dominicana to enhance food security and nutrition among vulnerable populations. Additionally, a $82,500 grant was awarded to the Trust of the Americas to support youth innovation and entrepreneurship initiatives.
Best digital bank: Banco Popular Dominicano
Banco Popular Dominicano continued to expand its digital channel in 2023. It developed a set of new applications aimed at specific segments, including Comerza for micro-entrepreneurs, gnial for the youth segment and YAVA for remittance recipients.
The bank conducted more than 83 million transactions in 2023 through its Popular app, a 37% increase over the previous year. Of the total transactions that are carried out digitally, 76% of them are through the app. Around 25% of the bank’s products are sold digitally, an increase of 150% year on year. And 22 operational processes were automated in 2023.
The bank continues to promote the adoption of cloud services across different products. It has migrated 104 applications to date. Banco Popular Dominicano has also made significant progress in cybersecurity by implementing advanced bot protection, which can detect over 40,000 attacks per day. The artificial intelligence modules they deploy can also resolve 30% of incidents without human intervention.
Best bank for SMEs: Banco Popular Dominicano
Banco Popular Dominicano saw impressive growth in its small and medium-sized enterprise business sector last year. Its SME commercial loan portfolio saw an increase of Ps17.9 billion ($303 million) in 2023, up 148% year on year.
The bank has designated micro, small and medium-sized enterprises as a segment with high potential. It has continued supporting these businesses through initiatives like its Challenge Popular, Impúlsate Popular, Emprende Mujer, Xpertos, ProExporta Popular and Banca 360.
The bank also launched new digital products, which include Comerza for micro-entrepreneurs. The introduction of its new business app gives its customers an updated flow of approvals and product management, including product consultation, authorization scales and credit line disbursements.
Best bank for ESG: Banreservas
In 2023, Banreservas launched Renueva Verde, a financial service programme to reduce energy costs and negative environmental impacts by offering incentives for families and companies to adopt clean energy solutions. This includes financing of up to 80% of the product, with fixed rates from 6.45% for up to three years and payment installments of up to 84 months.
To increase renewable energy generation, Banreservas has also financed the construction of a $62.5 billion photovoltaic power plant with an installed generating capacity of 79.13 megawatt peak, one of the biggest solar farms in the country. The project will include a solar farm of 118,710 photovoltaics modules of 540 watt peak and 28,080 modules of 535Wp. The photovoltaic plant is expected to generate more than 121.98 gigawatt hours a year. It is estimated that this park will save more than 60,000 tonnes of CO₂ emissions per year and generate more than 400 jobs in the region during construction.
Banreservas has organized various financial inclusion events reahing over 646,000 Dominicans and provided financial education to more than 120,000 individuals. In 2023, the programme included workshops that led to the opening of over 150 savings accounts and more than 80 Mío Banreservas electronic payment accounts.
Best bank for corporate responsibility: Banreservas
In 2023, Banreservas showed its commitment to corporate social responsibility through support for financial inclusion, tourism and entrepreneurship, while also making progress on sustainable development and community empowerment.
Tourism in the Dominican Republic continued to grow in 2023, allowing Banreservas to increase its share of the tourism loan portfolio from 29% in 2022 to 37%. The bank has also invested $37 million in the Port Cabo Rojo project to develop a maritime terminal that will serve ships from different cruise lines. This is expected to generate more than 4,500 jobs, foster economic activity in the country and facilitate the arrival of an additional one million visitors per year in the Dominican Republic.
Banreservas also held multiple workshops in 2023 on financial education for adults and children. The Banreservas Accesible project promotes access to job opportunities in the institution for people with disabilities. Sixty people with intellectual disabilities took financial education workshops for three months under the support of Voluntariado Banreservas and the Yo También Puedo Foundation.
The bank also shows its support for entrepreneurship through the Cree Banreservas programme. In 2023 the programme selected five entrepreneurial projects for an investment of up to Ps4.2 million ($71,000). To date, through the Cree programme, Banreservas has evaluated more than 4,000 projects and supported more than 600 events.
