Chile's central bank has authorised credit unions to request loans from foreign and local financial institutions as part of a larger reform-package introduced to boost the capacity of credit unions to provide financial services to members, according to a statement from the monetary authority.
The central bank said credit unions with an equity above 400,000 UF (the UF is Chile's indexed peso-denominated monetary unit), equivalent to US$9.3m, are permitted to engage in factoring and leasing operations, issue mortgage-backed loans, make payments and account transfers, as well as issue bonds on the capital market.
The reform package also authorises credit unions to take demand deposits, open savings accounts and offer financial services from third parties. Also, under the new rules the unions will be able to invest in bonds with "proper risk ratings".
