Chilean Banking Legislation: Origins, Laws, and Regulations

Origin of Banking Legislation in Chile

The laws dictate the National Savings Fund and Mortgage Fund. New banks were founded, each with the particular issue of its own paper money. The SBIF was created during the Arturo Alessandri administration, following a contract with U.S. experts from the Kemmerer Mission, which adopted three measures:

• To issue a monetary law
• Enact the law that created the Central Bank
• Issued a general banking law

Bank Concept

A bank is defined as a "special corporation. A bank is a financial intermediary responsible for acquiring funds in the form of deposits, lending money, and providing financial services."

Law No. 04/186

The Law No. 04/186 on corporations is particularly important for banks, as these institutions, in our legislation, should take the form of an open corporation especially governed by the provisions applicable to them provided they do not conflict or be incompatible with the general banking law.

Differences Between a Bank and Open Corporations

Open Corporations are born without the intervention of the watchdog legal (SVS). In the case of banks, the general banking law provides regulations for their creation and modification of their statutes.

Corporations can have any lawful purpose; however, banks can only turn the business of receiving money capital. Banks must have a minimum capital of at least 800,000 UF. Societies have no such requirement in their constitution.

In the name, banks must necessarily use the term bank and may dispense with the term corporation. Banks are subject to the control of the SBIF, while companies are under the control of the SVS.

Attitudes the Superintendency Can Take

1. Reject the prospectus for failing to meet the founding partners with the requirements of solvency and integrity.
2. No rule: if you do not, either party may request stating the fact and the certificate will serve as authorization.
3. Favorably Pronunciarse

Articles of a Bank

Drafting of Statutes

The statutes shall first be reviewed by the Superintendent and contain the detailed rules governing the future society.

Application for Approval of Existence

Since delivery of the certificate of provisional approval, start running within 10 months to ask the same authorization of wire transfer protection.

Wire Transfer Protection

There is established a whole system of protection of banks to prevent other entities or persons, natural or legal persons not authorized by law to conduct the business of banks therefore can not carry out the following activities:

Presumption

There is a presumption in our law which states that if a person pursues a room or office work placement money, bank wire illegally practices.

Directory of a Bank

Comupesto Directory. The number of directors must be odd, minimum 5 and maximum 11.

Tenure of office. Three years in office and with the power to be reelected.

Appointment.

• Directory Provisional: is designated in the bylaws and shall serve until the first meeting of shareholders.
• Definitive Directory: is appointed by the shareholders' meeting.

Ceasing to hold office. The director who fails to attend meetings during three months without the authorization of the Board, ceases to hold office for that single circumstance.

Requirements to Become a Director

The law does not establish requirements or special requirements, only tells us that: It is required to become Director holding shares in the entity, unless the statutes so provide. In addition to prohibiting those requirements arising from the nationality or profession.