Aug 5, 2006, 8:49 AM
Post #21 of 26
All major Mexican banks and investment houses will have correspondent banking relationships with a U.S. bank and banks in other countries. That simply means that the banks maintain accounts and relationships with each other. For instance, in a normal wire transfer from your U.S. bank to the Lloyd investment house, your U.S. bank would send a U.S. Dollar domestic wire to Lloyd´s U.S. bank account in the U.S. which happens to be Bank of America in San Diego. Then, those U.S. Dollars are converted to Pesos which are then credited to your account. You can bet that banks and investment houses both take advantage of this situation and you will pay with a lesser exchange rate. There is a way around this I have discussed elsewhere.
There is a lot of talk on these forums about how folks down here maintain accounts at local banks with relationships allowing them to transfer funds internationally for free. This is a joke the banks play on gullible people. So, the U.S. bank tells the consumer, we transfer funds to XYZ Bank in Mexico without charge and then they screw you on the exchange rate. My favorite is that California bank with joint ownership with a Mexican bank that all these expats brag about. Their deposit products, when I checked, were well below market in their returns so here they transferring funds for "free" and giving their customers the shaft when paying for their deposits. Although I can´t say that particular bank is doing this, they can get you on both the deposit interest rate and exchange rate and, at least on the exchange rate, you´ll never know you are being screwed.
If you think banks are giving away services then I have a bridge to sell you.
(This post was edited by Bubba on Aug 5, 2006, 8:52 AM)