Financial integration and permanent stability are just a few factors that keep banks in Panama from confronting periods of credit restriction.  The availability of funds during times of financial crisis, provides peace of mind to investors.  The absence of a central bank, a monetary authority, paper money, and the use of the dollar aid in the protection of the banks from the effects of the crisis; this is why Panamanian banks provide complete confidence in the system.

This situation allows banks to issue financial instruments for international markets, and prestigious catalysts of this subject such as the Merchant Marine Law, Insurance and Reinsurance consider Panamanian Banks as the most important in the region.

The president and CEO of HSBC Panama, Joseph Salterio said, regarding this subject, that Panamanian banks are prepared to finance incoming megaprojects. That said and  nevertheless, Salterio specified that if the countries economic growth continues the banks in Panama will have to duplicate the loan amounts to be offered in the following years.

The experienced businessman explained that many of the upcoming projects require millions and that in addition to the banks of Panama, they are looking at “outside markets”.  He concluded by clarifying that the mergers taking place within Panamanian banks are making them stronger, and therefore, more competitive to face these challenges.

 Conservative Financial Politics

Currently the mergers between HSBC and Banistmo have created the largest bank in Panama. Another merger within Panamanian banks is the one between Banco General and Banco Contiental, with approximately 20% each in the market. The private foreign capital banks that reflect the biggest increase in Panamanian banks are HSBC and BAC International Bank. Elements such as the current banking legislation and banking confidentiality increase the security and confidence of clients. Additionally Panamanian banks have agreements, decrees and regulations to stop money laundering.

The banks in Panama are also known as the “Switzerland of Latin America”, attracting businessmen and investors to open bank accounts and invest in Panama. Attractions such as high liquidity of the banks continue to be the main source of credit expansion. The results and tendencies of Panamanian banks reflect a solid performance and good financial condition. 

The increase of local credit is centered in the consumer sector. The credit for the real estate market remains a positive trend within Panamanian banks for having great power in the local economy. The banks in Panama maintain interim conservative financing politics of construction, which is why they have established some measures regarding the real estate sector.