Banco Agricola expanding to serve Central America.

Grupo Banco Agricola, one of El Salvador's leading financial institutions, has opened a new banking office in Panama as part of its regional expansion strategy. Banco Agricola Panama, along with the group's banks in Honduras, Nicaragua and a representative office in Guatemala, will serve as the vehicle through which Group Banco Agricola can build a larger base of key corporate clients within the regional market, and carry out further investments in Central America,

"For the last three years Banco Agricola's strategy has focused on consolidating its leadership position within the Salvadorian banking system," says Roberto Orellana, executive vice president. After two recent mergers, Banco Agricola holds now a 30 percent market share in El Salvador, with a base of more than 1.2 million clients. "Our expansion strategy will lead Banco Agricola into operating, in a near future, as a regional bank," adds Orellana.

On the international level, Banco Agricola has taken advantage of the opportunities presented by the 2001 dollarization of El Salvador's economy to service additional corporate clients within the Central American region. "That move, which eliminated currency barriers, challenges all local market participants to actively seek greater competence and efficiencies," says Orellana. "Under this new monetary regime, currency risk is eliminated, giving greater access to international funds, which translates into improved benefits for the local population: reduction of interest rates, longer credit terms, and a broader offer of financial products. The local institutions can also match their assets and liabilities in U.S. dollars, enabling them to pursue foreign business within the region."

By opening the bank in Panama, along with the banks and offices in Guatemala, Honduras and Nicaragua, Grupo Banco Agricola is ready to broaden and consolidate its position within the Central American regional market. "Free trade agreements are creating new opportunities to further integrate Central American markets," says Orellana, "which will place additional demands on the financial sector for its services. The banking systems will need to operate under more standardized policies and regulations, facilitating the development of a regional banking system."

A free trade agreement between El Salvador and the United States would also give Salvadorian banks like Banco Agricola greater access to the Salvadorian and the broader Central American community within the United States, a market of more than ten million people. Grupo Banco Agricola currently operates in the United States, and the new conditions would open new possibilities for expanding its business.

Since its founding in 1955, Banco Agricola has delivered services to clients from all sectors of the economy. Through the years it has built a well-diversified loan portfolio of over US$1.7 billion. In the decade of the 1990s, Banco Agricola became the leading bank of the Salvadorian financial system, currently managing over US$3 billion in assets, with a capital base above US$250 million. The group's broad-reaching infrastructure includes 100 agencies, a network of tellers and kiosks, and Internet services.

For more information, visit www.bancoagricola.com.