Título IV. Los Bancos, sus operaciones y servicios

Banks authorized in accordance with this Law may carry out operations in national or foreign currency and provide the following services:

a)Passive operations:

1.Receive monetary deposits;

2.Receive term deposits;

3.Receive savings deposits;

4.Create and negotiate bonds and/or promissory notes, with prior authorization from the Monetary Board;

5.Obtain financing from the Bank of Guatemala, in accordance with its organic law;

6.Obtain credits from national and foreign banks;

7.Create and negotiate convertible obligations;

8.Create and negotiate subordinated obligations; and,

9.Carry out repurchase agreement operations as repo seller.

b)Active operations:

1.Grant credits;

2.Carry out discount of documents;

3.Grant financing in letter-of-credit operations;

4.Grant advances for export;

5.Issue and operate credit cards;

6.Carry out financial leasing;

7.Carry out factoring;

8.Invest in securities issued and/or guaranteed by the State, by banks authorized in accordance with this Law or by private entities. In the case of investment in securities issued by private entities, prior approval from the Monetary Board shall be required;

9.Acquire and retain ownership of immovable property or movable property, provided that they are for its use, without prejudice to the provisions of numeral 6 above;

10.Place deposits in other banks in the country and in foreign banks; and,

11.Carry out repurchase agreement operations as repo buyer.

c)Trust operations:

1.Collect and pay on behalf of third parties;

2.Receive deposits with financial investment options;

3.Buy and sell securities on behalf of third parties; and,

4.Serve as financial agent, handling debt service, payment of interest, commissions and amortization.

d)Contingent liabilities.

1.Grant guarantees;

2.Provide avals;

3.Grant surety bonds; and,

4.Issue or confirm letters of credit.

e)Services:

1.Act as fiduciary;

2.Buy and sell foreign currency, both in cash and in documents;

3.Opening of letters of credit;

4.Carry out collection operations;

5.Carry out transfer of funds; and,

6.Lease safe-deposit boxes.

The Monetary Board may, with prior opinion of the Superintendency of Banks, authorize banks to carry out other operations and provide other services not contemplated in this Law, provided that they are compatible with their nature.

Persons who have been designated or who are designated by a natural person holding a monetary deposit, term deposit or savings account, to receive the balance thereof in the event of death of the latter, shall be referred to as beneficiaries.

Upon the death of the holder, *or that of the designated beneficiaries, they shall acquire a right of their own to the balance thereof, which they may demand directly from the bank, provided it is not contractually limited or restricted by competent authority.

*(The underlined phrase was declared

15/01/2015, Files 2523-2013 and 2807-2013).

In any case, the beneficiary or beneficiaries must prove to the depositary bank the death of the account holder.

Where monetary deposits are concerned, the beneficiary may only withdraw the available funds after a time limit of six (6) months has elapsed, counted from the date of death of the account holder.

Payment made by the bank to the designated beneficiaries, on the terms indicated in the present article, extinguishes the obligations arising from the bank deposit contract.

Monetary and savings deposit accounts in national currency with balances of less than one thousand quetzales (Q.1,000.00) and monetary and savings deposit accounts in foreign currency with balances of less than one hundred twenty-five Dollars of the United States of America (US$125.00), which remain inactive for a period of ten years, except those conditioned by the account holder or contractually limited or restricted by competent authority, shall prescribe by operation of law, together with the interest they have accrued, in favor of the Fund for the Protection of Savings, a matter that the bank shall bring to the knowledge of the account holders by the means it deems appropriate.

An account shall be understood to have remained inactive when its holder has not carried out deposit or withdrawal transactions within the time limit indicated.

The transfer of the balance of the accounts referred to in the first paragraph of this article to the Fund for the Protection of Savings shall be made within the month following the month of expiry of the aforementioned ten (10) years.

Banks authorized in accordance with this Law shall freely agree with users on the interest rates, commissions and other charges they apply in their operations and services. In no case may commissions or expenses be charged for services that do not correspond to services effectively rendered or expenses incurred.

In all contracts of a financial nature entered into by banks, they shall expressly state the equivalent annual effective rate, as well as any changes made thereto.

Banks shall carry out their operations and provide their services to the public during the hours they have established. Established schedules and any changes made thereto shall be communicated to the Superintendency of Banks at least five days prior to the entry into force thereof.

Any general interruption or suspension of a bank's operations and provision of services may only be carried out upon prior communication to the public and authorization from the Superintendency of Banks.

Banks shall maintain global proportions between their active and passive operations in foreign currency, in accordance with the provisions issued by the Monetary Board.