Andorra is a very small country adjoined by France and Spain. Andorra financial market is largely dependent on the banking sector. However, tourism forms a significant portion of the national economy of Andorra. The backbone of Andorra’ economy is its tourism industry.
Nevertheless, financial services came up as a crucial segment of the economy of Andorra during the 1990s. The banks operating in Andorra are famous for their transparency in dealings as well as the security aspects. Foreign investments are taking place in Andorra because there is no system of direct taxation in Andorra and this is a principal advantage for the overseas investors.
There is an informal group of bankers and banks in Andorra and they hold meetings regarding financial matters in Andorra on a periodical basis. Andorra has no stock exchange. Hence, trading of stocks and bonds are not prevalent in Andorra.
The leading banks of Andorra include the following:
Banca Privada d’Andorra
Banc Agricol; Comercial d’Andora
Banc Internacional d’Andorra
Andorra does not have any national currency of its own. However, the French franc and the Spanish peseta had circulated in the country.
Andorra is not a complete member of the European Union. However, Euro does circulate in the country as the third currency (besides French franc and Spanish peseta). The Euro was introduced in Andorra in the year 2002.
For a number of years, the banking system of Andorra was self-regulated. The most significant feature of the banking sector of Andorra is that the liquidity, solvency, as well as the capitalization ratios are greater in comparison to the international average.
The banking sector of Andorra can be subdivided into seven segments and represents the dominant portion of the Andorra financial market. However, 36 insurance companies, portfolio management companies and private lending institutions carry out the remaining part of the financial activities in Andorra.
Last Updated on : 1st August 2013