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Bancredito Branches Will Cease To Operate On July 14; 500 Employees Being Laid Off

The State Bank, Bancredito, will cease to operate as a commercial bank, being transformed into a development bank. On July 14, all accounts will become inactive, ATMs closed and debit cards blocked.

The State bank, Banco Crédito Agrícola de Cartago (Bancrédito) has literally only days of life of operating as a bank and has asked all remaining customers to withdraw their money, by or on Friday, July 14, when all accounts will become inactive, its ATMs will be out of service and debit cars blocked.

“Customers have shown confidence in Bancredito by continuing to make deposits and using their accounts, but it is important to remind that there are only two weeks left (from the notice) to withdraw their money,” said Gerardo Porras, general manager of the state institution.

According to the last cut on July 3, 61% of the amount on deposit in colones and 66.2% in dollars has already been withdrawn.

Porras explained that funds in accounts at the day of closing will be transferred to a trust, managed by another State bank and customers will then have to process a claim to recover.

The financial problems at the State Bank became critical when, on May 25th, the government decided the entity would be transformed into a development bank and cease all commercial (consumer deposits and lending) operations, that is it will no longer receive nor lend money to the public.

The announcement said the 500 employees will be laid off. For the first group, 285 employees, will have their last day at work on July 31; the remaining will stay on until the end of August. The bank said it will be paying out some ¢3.5 billion colones in severance pay.

For the Bancredito to continue its “institutional” banking role, between 120 and 130 people will be keeping their jobs.