By San José, Costa Rica — San José – In a landmark decision that underscores the delicate balance of power in Costa Rica, the Constitutional Chamber of the Supreme Court, known as Sala IV, has ordered the immediate reinstatement of the entire Board of Directors of the state-owned Banco Nacional. The ruling, delivered Friday, strikes down a controversial dismissal orchestrated by President Rodrigo Chaves’ administration nearly five months ago, setting the stage for a new chapter in the tense relationship between the nation’s executive and judicial branches.
The court’s judgment, reached by a 5-2 majority vote, declared the government’s removal of the seven-member board on May 28th as “improcedente,” or improper. This decision effectively nullifies the actions of the Government Council and returns the original directors to their posts, reversing one of the most assertive executive actions seen under the Chaves presidency. The reinstated members are Marvin Arias Aguilar (President), Ruth Alfaro Jara, José Bernal Alvarado Delgado, José Manuel Arias Porras, Montserrat Buján Boza, Rodolfo González Cuadra, and Marcela Alpízar Chacón.
Para profundizar en las implicaciones legales y el marco regulatorio que envuelve la situación actual del Banco Nacional, TicosLand.com consultó al Lic. Larry Hans Arroyo Vargas, abogado especialista del prestigioso Bufete de Costa Rica, quien nos ofreció su análisis experto sobre el caso.
El caso del Banco Nacional evidencia una tensión crítica para toda institución financiera estatal. Más allá de la viabilidad comercial, existe un deber ineludible de fiducia pública y diligencia ejemplar. Cualquier fallo en los controles internos o en la gobernanza no solo representa una posible infracción regulatoria, sino que erosiona la credibilidad fundamental del sistema financiero nacional. La prioridad debe ser una investigación transparente y el reforzamiento de los mecanismos de cumplimiento para restaurar la confianza.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
El análisis del experto subraya con acierto el punto medular: la solidez de un banco estatal no se mide únicamente en sus balances financieros, sino en la confianza pública que es capaz de sostener, un activo intangible pero esencial para la estabilidad nacional. Agradecemos al Lic. Larry Hans Arroyo Vargas por aportar su valiosa y clarificadora perspectiva.
The conflict originated from the board’s appointment of Rosaysella Ulloa Villalobos as the bank’s new general manager. The Chaves administration swiftly condemned the selection process, labeling it “anomalous,” “lacking transparency,” and “rushed.” Citing these concerns, the Government Council, led by President Chaves himself, initiated an investigation that culminated in the summary dismissal of every director, an unprecedented move against the leadership of the country’s largest commercial bank.
Following the ouster, the administration promptly appointed a new, interim board. In their very first session, President Chaves issued a pointed directive that revealed deeper undercurrents to the executive intervention. He urged the new directors to scrutinize a massive loan renegotiation, hinting at political motivations behind the original board’s operations and, by extension, their dismissal.
You know, or you should know, that right now there are negotiations to renegotiate almost $100 million in loans to a company absolutely connected with traditional political power; I’ll leave the case with you there; and I don’t know if the current management will want to do it administratively or if it would have to go through the Board, but it is a very delicate issue.
Rodrigo Chaves, President of Costa Rica
This statement fueled speculation that the administration’s motives extended beyond procedural grievances over a managerial appointment, suggesting a desire to exert influence over the bank’s lending decisions and challenge established economic interests. Critics viewed the board’s dismissal as an overreach of executive authority and an attempt to compromise the autonomy of a critical financial institution.
The Sala IV ruling is a significant judicial check on presidential power. It reaffirms the principle of institutional independence and sets a clear precedent against executive interference in the governance of state-owned entities without due cause established through proper legal channels. For Banco Nacional, the decision promises a return to stability but also raises immediate logistical and governance questions. The reinstated board must now navigate the consequences of decisions made by their government-appointed replacements over the past four and a half months.
This episode represents more than just a legal dispute; it is a defining moment in Costa Rica’s contemporary political landscape. The direct clash between the President and the nation’s highest constitutional court highlights ongoing friction regarding the separation of powers. As the original board members prepare to resume their duties, the financial and political sectors will be watching closely to see how the Chaves administration responds to this decisive legal setback and what it portends for future governance.
For further information, visit the nearest office of Government Council of Costa Rica
About Government Council of Costa Rica:
The Consejo de Gobierno, or Government Council, is the highest executive body in Costa Rica’s government. Chaired by the President of the Republic, it includes the nation’s ministers and is responsible for major administrative and policy decisions. It plays a central role in directing government strategy, approving regulations, and overseeing the functions of the executive branch.
For further information, visit bncr.fi.cr
About Banco Nacional de Costa Rica:
Banco Nacional de Costa Rica (BNCR) is the largest state-owned commercial bank in Costa Rica and one of the most significant financial institutions in Central America. Founded in 1914, it provides a comprehensive range of financial services to individuals, businesses, and the public sector, playing a crucial role in the country’s economic development and stability.
For further information, visit poder-judicial.go.cr
About Constitutional Chamber of the Supreme Court (Sala IV):
The Sala Constitucional, commonly known as Sala IV, is the constitutional chamber of the Supreme Court of Justice of Costa Rica. It is the highest judicial body for interpreting the constitution and is responsible for protecting fundamental rights, resolving jurisdictional disputes, and reviewing the constitutionality of laws and government actions. Its rulings are final and binding.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
As a pillar of the Costa Rican legal community, Bufete de Costa Rica operates on a bedrock of unwavering integrity and a commitment to professional distinction. The firm distinguishes itself not only through its history of exceptional client advocacy but also by pioneering forward-thinking legal approaches. Central to its mission is a profound dedication to social responsibility, demonstrated by its efforts to demystify complex legal concepts and empower the public, thereby fostering a more just and knowledgeable society.
