In a letter sent to the International Monetary Fund (IMF), the Dominican government says that the stress test carried out by the Superintendent of Banks "suggests that the banking sector can resist the current global financial conditions without any great problems." 

"The banks are well capitalized, are earning money and are blessed with sufficient liquidity and solvency," says the policy letter that the government sent to the IMF as a prerequisite for a monitoring agreement, post-Stand-by. 

The policy letter is a kind of letter of intent that is sent when an amplified agreement is being negotiated. The letter is published in several dailies today.

The Central Bank said that following instructions from President Leonel Fernandez, on 7 January the government's economic team presented the policy letter that will be read by the IMF Board of Directors for a monitoring agreement. 

In the letter, signed by the Minister for Economy, Planning and Development Temistocles Montas, the Minister of Hacienda Vicente Bengoa, and Central Bank governor Hector Valdez Albizu, the economic team points out the maintenance of macro-economic stability, in spite of the upsets caused by the international economic crisis.

The letter details the actions taken to slow down credit by increasing interest rates three times during 2008, which helped to stem inflationary tendencies and maintain a relatively stable exchange rate.

The letter also admits to the need to implement a realistic fiscal program while at the same time ensuring that the combination of macro-economic policies promotes moderate growth with stability.