Central report : Honduras -- financial sector assessment

This report assesses these various institutions, including the Central Bank, commercial banks, savings and loans, government financial institutions, pension funds and insurance companies, and capital markets. The report also discusses the macroeconomic environment, the supervision of financial institutions, and informal finance. A major finding is that the Central Bank is involved in a number of inappropriate activities which interfere with its basic functions. For example, it is responsible for approving import quotas and permits, and it carries out certain commercial banking functions, as well as a variety of non-banking activities, for the Honduran Government. The predominant private sector financial institutions are the commercial banks, of which a few are mixed capital with marginal public sector participation. Informal financial markets are highly important and include a wide variety of agents, institutions, and arrangements that extend far beyond finance companies and moneylenders and probably provide financial services to a larger proportion of the Honduran population than do formal financial institutions. The report concludes by outlining a strategy for financial sector reform, including not only high priority policy adjustments, but also actions to strengthen specific institutions both public and private.