Several articles have mentioned that the Panamanian economy weathered the world economic crisis fairly well. Even though the growth of its GDP went down dramatically it still showed positive growth for last year and is expected to do better this year. There is no industry where this is truer in Panama than in the banking industry. Banking in Panama is world renowned for many reasons and is also known for its conservative policies and prudent management. These two characteristics have made it safe haven in stormy financial seas.
From January to November of last year the Panama Banking Center grew 2% showing assets amounting to 64,749 million dollars. Liquidity levels are solid increasing by 4.2% although the credit portfolio did diminish slightly by 1.95% versus 2008. The reduction in the credit portfolio is to be expected as banks apply more stringent requirements and people simply request less financing.
Panama’s banking center is composed of many local banks and once they published their 2009 results it became evident that overall Panamanian banks did weather the crisis very well. Banco Universal a small local bank with 10 years of operations earned 2.6 million dollars, a 20% increase over its profit in 2008 and its best year yet.
Another important local bank in Panama, Multibank, reported net profits for the close of 2009 of 21.5 million dollars, a 43% increase over 2008. This increase was mainly due to adequate management of the interest margin plus the excellent financial performance of its investment portfolio. It has liquidity level of 83%, well above the 30% required by Law. In spite of being a local bank it also has presence through 47 agency offices in Colombia and is planning to open in Panama five new branches before the end of 2010.
For more on Panama and banking: PanamaQmagazine.com