Nicaragua's Bancorp asks to cease operations after U.S. sanctions

FILE PHOTO: A woman walks past a building of Bancorp (Banco Corporativo S.A) in Managua, Nicaragua March 7, 2019. REUTERS/Oswaldo Rivas

MANAGUA (Reuters) - Nicaraguan bank Bancorp has requested permission from the country’s banking regulator to cease operations after the United States imposed sanctions on the firm, according to a letter seen by Reuters on Wednesday.

Bancorp submitted a request to Nicaragua’s banking and financial regulator for “early voluntary dissolution.”

“Our bank is unable to continue doing business due to the sanction,” said the letter dated April 22 and signed by Luis Barcenas, Bancorp’s legal representative.

U.S. national security adviser John Bolton last week called Bancorp a “slush fund” for Nicaraguan President Daniel Ortega and announced sanctions on the bank as well as and the president’s son Laureano Ortega, for what he described as “vast corruption.”

Washington has previously sanctioned President Ortega’s wife and Nicaraguan Vice President Rosario Murillo.

Bancorp was created in 2015 as a subsidiary of Alba de Nicaragua, known as Albanisa. The company is a joint venture of Venezuela state oil firm PDVSA and Nicaragua’s own state-run Petroleos de Nicaragua.

Nicaraguan lawmakers in March voted to approve a government purchase of Bancorp for $23 million.

The banking regulator confirmed it received Bancorp’s request to dissolve, but did not clarify whether the government acquisition had been finalized.

Reporting by Ismael Lopez, Writing by Daina Beth Solomon, editing by G Crosse