Well, it’s no secret I hate most Mexican banks. For good reason, I might add. Today I’m having the less-than-pleasant experience of closing two accounts we’ve had since about 1990. With things being as they are I figure others will want to do the same, so here’s how and why.

I don’t know about other parts of Mexico, but here in Los Cabos the HSBC bank has been thrilling us all by changing their policies almost daily. For the most part I’ve ignored it as we’re not heavy bankers. My friends with cash businesses and who have to deposit daily, on the other hand, are about ready to pull their hair out; or the bankers’ hair. In the U.S. they say someone is ‘going postal’, here we might start saying someone who is losing it is ‘going banking’. HSBC finally got my attention, though, with one of their newest rules. They no longer take dollar deposits into dollar accounts. Since I get paid in dollars I wondered what would happen, would I be back to cash in the mattress? Oh no, I could deposit my dollars, but only into my peso account. From there I’m allowed to transfer the funds to my dollar account. Huh?

Like most people down here Bob and I have both a peso and dollar account at the same bank. The bulk of our funds are held in the dollar account, and we transfer to pesos as needed. Which has worked splendidly for all these years, but won’t now under the new rules. Why? The exchange rate. More specifically, because there are really two exchange rates: one if you’re buying pesos and another if you’re selling them.

Let’s do the math. Let’s say I have $1,000 USD I want to deposit into my dollar account at HSBC. By the way, HSBC stands for Hong Kong Singapore Banking Company, which is one of the world’s largest banks. This exercise might explain how they got that rich.

So back to my $1,000 deposit…. The only way to get those dollars into my dollar account is to run it through the peso account. When I make the deposit I am buying pesos. Today’s rate at HSBC for buying pesos was 12.41 pesos to the dollar. So my account would be credited with 12,410 pesos. Now I want to move the pesos into my dollar account, so I’m selling pesos. The rate for selling this morning was 12.78 pesos per dollar. So it takes more pesos to buy a dollar than I got when I sold the dollar about a millisecond ago. When my deposit reaches the dollar account it’s only worth $971.05. HSBC just helped themselves to about $30 bucks to ALLOW me to put MY money in THEIR bank. Enough! We’re closing these accounts and moving to another bank.

Here’s what you’ll need: your check book, your last statement, and your I.D. If you are a foreigner that ID will be your FM-3 or FM-2 (residence visa). After you get to a customer service representative they will check your I.D. and your balance. They will fill out various forms. For your peso account they will write up a check for the final balance, and destroy all the remaining checks. You can cash the check with the tellers. No, you can’t get a cashier’s check so spend down the account or bring an armored truck.

Ah, the dollar account… you can’t write a check for the balance. You can’t get cash. You can only take your funds in traveler’s checks. Why? Why bother asking, this is HSBC. And the traveler’s checks have to be ordered. Ours are scheduled to be at the bank at 3 PM, I’ll let you know how it goes.

I *HATE* Mexican banks! Well, at least most of them…….

Carol Billups is Broker/Owner of REALTY EXECUTIVES Los Cabos. A Certified Home Marketing Specialist, she has enjoyed working with both buyers and sellers for nine years and still thinks hers is the best job on earth. She is also the real estate columnist for Los Cabos Magazine. You can read more of her articles on www.reloscabos.com. You can reach her from the U.S. or Canada at 1-760-481-7694, or in Cabo at 044-624-147-7541.

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© 2009 Carol S. Billups