History

Creation of the Banco de la República

The Banco de la República was established as the Central Bank of Colombia on the 25th of July 1923 by means of Law 25. The Bank was organised as an anonymous society with a starting capital of 10 million in gold, of which the Government provided 50% and foreign and national commercial banks as well as some private individuals contributed the remainder. This entity was exclusively entrusted with the faculty of issuing Colombian legal tender, administrating the country’s international reserves, acting as banker to the Government and serving as a last resort moneylender.

The Banco de la República and the Constitution of 1991

 

The 1991 Constitution drawn up by the Constituent National Assembly introduced various reforms to the previously existing central banking system in Colombia.

 

The principal reforms were aimed at the replacement of the Monetary Board by the current Board of Directors to act as the maximum authority as regards monetary, credit and foreign exchange matters. The Board of Directors acts independently of the Government and is composed of seven members, as follows:

 

A Central Bank

 

A central bank is the institution that issues and administrates legal currency and exercises the function of banker of banks. Furthermore, it controls the country’s monetary system (currency), credit system (interest rates) and foreign exchange system (foreign exchange rates). Its principal functions include:

 

i. To act as State bank;

 

The Kemmerer Commission

 
In March of 1923, President Pedro Nel Ospina commissioned a group of experts, headed by Prof. Edwin Walter Kemmerer. This commission later became known as the Kemmerer Commission. The first action of the commission was to study Colombia’s economic reality by means of contact and discussion with business associations, agricultural societies and regional officials. 
 
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