The Grove Commission. In 1949, the Government invited a delegation from the New York Federal Reserve, headed by Daniel Grove, with the aim of carrying out a diagnosis of the Colombian banking system. This commission recommended providing the Banco de la República with a greater number of tools to regulate the money supply and channel credit as an incentive for economic development. As a result, the Bank’s Board of Directors was empowered, by means of the favourable vote of the Minister of Finance, to: i) Fix shares of ordinary, special, developmental and emergency credits; ii) both fix and vary the discount and interest rates for lending, discount and rediscounting operations; and, iii) Set and alter the amount of the legally stipulated reserve requirement for the banking system, amongst other functions.
In addition, the life span of the Banco de la República was extended, along with its exclusive role as issuer of the national currency, for a further 20 years as from July 20, 1953. The composition of the Board of Directors was modified to allow for greater union participation, in an attempt to reach greater understanding of the distinct sectors of the economy.