Monday, July 30, 2012

Panama banking center continues its expansion

The Panamanian banking center has 93 banks with $81.407 billion in assets, 13% more than 2010. $21.987 billion are held by Panamanian-owned non-government banks.

New Panamanian-owned banks include Unibank, Banco Panama, Capital Bank (BVP), Prival Bank and Balboa Bank & Trust, which took over the operations of the Stanford Bank Panama branch.

Panamanian-owned banks continue their expansion overseas. Banco General (f. 1955, BVP: BGEN) has a 5 full service branches in Costa Rica and the representation offices of acquired Banco Continental in Guatemala, Mexico and Colombia.

Multibank (f. 1990, BVP: MULT) acquired Costa Rican car lender MultiResuelve and Colombian money store Macrofinanciera.
Mortgage lender La Hipotecaria (f. 1997, BVP: HIPH) started operations in Colombia and El Salvador.
Private banker Prival Bank owns a stock brokerage firm in El Salvador Invertecnic.
Credicorp Bank (BVP: CRED) has a representation office in Colombia.

For full text see 24.04.12

Banking Statistics
Weekly Liquidity07/20/201265.10%-
Statutory Liquidity Methodologyicon_word
* Banking Center Assets05/201282,787.811.24%
* Banking System Local Deposits05/201234,533.210.29%
* Banking System Local Credit05/201230,415.016.31%
Number of Banks in the Banking Center05/201290-
* In Million of Balboas

For more information about the Panama banking system see

For requirements to open bank accounts in Panama banks see

Monday, July 23, 2012

Nomura is bullish on Panama government bonds

Nomura Jun12 - Panamá Report

Nomura warns about the disappearance of prudence in fiscal policy of the current administration, as cash from the 2010 eurobond sales is used in public works:

"During the Perez Balladares administration (1994-1999), Panama embarked on an ambitious structural reform agenda, including privatizing unprofitable and inefficient state-owned enterprises. In an important decision, the country decided to deposit the proceeds from these asset sales into the Trust Fund for Development (FFD), and only spend the investment proceeds from it.
This policy avoided the fiscal excesses that were common in the region at the time, where governments spent one-off revenues from privatizations to expand current public expenditure. When proceeds from these transactions ended, public finances suffered.
As such, we are concerned that the authorities will continue their expansive fiscal policy well into 2013. We think this could be the main reason for increasing the fiscal deficit ceiling this year as part of the law that created the FAP. In addition, if President Martinelli indeed runs for re-election in 2014, we think that Panama's political environment will deteriorate fairly quickly.
We recommend zero exposure to Panamanian sovereign bonds. While this positioning might be relatively premature, we prefer to recommend it now in expectation of a sharp rise in fiscal spending for electoral reasons next year.
For those that are currently involved in this credit, we think it may be opportune to begin executing an exit strategy.
We recommend replacing Panama with exposure to other high-grade credits in Latin America, such as Peru, Colombia and Mexico. Because of Panama's expensive valuations, we think investors are likely to benefit more from owning other LatAm high graders with lower downside risks. "

For individual investors seeking a Panama porfolio, purchase of preferred shares by Panama banks seem a sound alternative to government bonds.


Monday, July 16, 2012

Panama Canal calling on companies interested in building observation deck

The Panama Canal Authority seeks expressions of interest for the construction of an observation deck at the third set of locks of the expanded Panama Canal, Pacific Sector.
Proposals are expected from architecture and engineering companies.