Emerging Markets Rates and Currencies Handbook

Chile (CLP - Chilean Peso) Citi in Chile Citi has been present in Chile since 1916, when it opened as The National City Bank of New York in Valparaiso. Since its opening, the franchise has been an active participant in Chile’s economic development and has funded countless private and public projects. Since the merger of Citibank and Banco de Chile in 2008, Banco de Chile is a non-controlled subsidiary of Citibank N.A a national banking association organized under the laws of the U.S. Under Chilean regulation, the banking license is granted only to Banco de Chile as stand-alone legal entity. Banco de Chile’s main regulator is the Financial Market Commission (CMF). Banco de Chile is one of the most important players in the Chilean FX market, conducting transactions with the main Institutional clients (local Pension Funds, Insurance Companies, etc.), offshore players and large corporate clients as well as medium size companies and retail clients. Market Overview The Chilean Central Bank (BCCH) manages the peso under a free floating regime. The BCCH has been granted regulatory power to intervene in the exchange market to address excess volatility and extreme price distortions. However, in recent years, it has remained relatively inactive. Main regulations on foreign exchange transactions and foreign investment are contained in the Compendium of Foreign Exchange Regulations, which regulates foreign investor activity in the market. The regulation encompasses obligations to report certain transactions and currency in-and outflows. The BCCH is also allowed to participate in the Formal Exchange Market as a direct player. Foreign exchange regulations and Exempt Resolution 150/2020 of the Chilean Tax Authority require investors to execute their transactions in the Formal Exchange Market. Foreign exchange transactions must be informed to the BCCH by the entity executing them. Convertibility Yes (as of March 2021). 193