Delia Cárdenas, Superintendent of Banks of Panamá

Superintendency of Banks of Panamá Samuel Lewis Avenue HSBC Tower, 8th Floor

Phones: (507) 206-7800 or 206-7954
Fax (507) 264-9560
P.O. Box 0832-2397
Internet: www.superbancos.gob.pa
Email: superbancos@superbancos.gob.pa

MISSION

We regulate and supervise Panama’s International Banking Centre and the trust companies, with committed and specialized professional staff, using management instruments with state-of-the-art technology. We generate trust, timely and high-quality information and opinion for the national and international financial community; thus, we contribute to Panama’s economic development, by complying with international regulation and transparency standards

VISION

We guarantee an adequate regulation and supervision for the dynamic financial world. The International Banking Centre´s growth, together with its financial and administrative autonomy, allows us to reach our goals, supported by a highly developed physical and technological infrastructure. Based on constant improvement and the optimum use of resources, we foster private investment and we generate value for our users, which has turned us into an international standard.

Banking Regulator: Necessary Complementariness

In 1998, a new Law created the Superintendency of Banks of Panama as a regulatory entity for the banking system, strengthening its autonomy and independence. The new regulations rest on the 25 Principles for an Effective Banking Supervision issued by Basel Committee. The degree of observance of the 25 principles was favorably assessed by the International Monetary Fund (IMF) in 2001. During the last five years, a broad regulatory framework has been developed in keeping with the highest international standards, which ensures an adequate supervision of the main banking risks; among the regulations, we underline asset rating, estate customization, market risk, corporate government, external auditing and mergers and acquisitions, among others.

The Superintendency of Banks of Panama fulfills a key role in the successful adaptation and guaranteed stability of Panama’s Banking System. The solid foundations and confirmed effectiveness of the Banking Centre consolidate the country as one of the safest places in the region and the rest of the world for capital investment. The efforts and willingness to lead changes, which were needed to ensure the system’s stability and better supervision, were possible due to a combination of factors that allowed Panama to consolidate its banking system.

A key element in this process is an increase of the institution’s human resource technical training, which allows it to have updated knowledge of the main changes in financial system supervising and regulating matters. This is attained through its membership in analogous international financial organizations that offer continuous training programs.

Among the international organizations with which this link exists, there are: The Association of Supervisors of Banks of the Americas (ASBA), the Caribbean Financial Action Task Force (CFATF), Offshore Group of Banking Supervisors (OGBS), Central American Council of Superintendents of Banks, Insurance and Other Financial Institutions, International Monetary Fund (IMF), Inter-American Development Bank (IDB), Bank for International Settlements (BIS), the Financial Stability Institute (FSI) and they are a collaborating member of the Centre for Latin American Monetary Studies (CEMLA).

Modernizing the computer and technology infrastructure of the Superintendency of Banks of Panama has allowed receiving online information from banks to provide better indicators with timely reports within a transparent financial framework.

Panama : International Banking Centre

During the last few decades, Panama has become known as an International Banking Centre whereby numerous financial institutions from different geographic regions carry out the banking business, especially to back up, among other things, the international trade financing of the Latin American market, the treasury management of important international banking groups, as well as the development in latter years of private banking and asset management.

The successful performance of the Banking Centre is one of the pillars of the Panamanian economic system, which is characterized by its traditional macroeconomic stability, with growth, low inflation, lack of exchange risk and interest rates approaching international rates. The integration of the banking system to the rest of the world and the use of the United States Dollar as legal tender have ensured an indescribable successful experience for a whole century.

A Center prepared for global changes

Starting last decade, the international financial markets have experienced new realities because of a series of important transformations in international banking strategies for developing the banking business, as well as changes in market regulation foundations, with the purpose of guaranteeing greater stability and transparency of the international financial system. The wave of mergers in the international realm and the greater positioning of the large banking corporations in the main markets of developed nations are some of the main signals of the great changes that the international financial market underwent during the nineties.

Panama’s Banking Centre has not escaped these changes and has successfully adapted to the new realities. During the last five years, changes were brought to the banking regulations to convert them to the highest international regulation standards and to strengthen the institutionalism of the banking system’s supervision.

The Strength of Regional Banking

Another characteristic trait of the transformation of Panama’s Banking System is the large-scale regionalization that the system is undergoing. This fact is intimately linked to the stability Panama provides to the region’s main investors and to the significant advances carried out to promote and keep said stability. The main Central American banking groups that operate in Panama provide a variety of financial services to a clientele with high growth potential, which will increase with the signing of the Free Trade Agreements, thus attaining new possibilities and growth opportunities in the region’s productive, industrial and service sectors.

Regionalization poses challenges for Panama; not only the challenge of attracting major banking institutions to the marketplace, but also of maintaining regulation and supervision standards that could be commonly applied in the area. The efforts in this direction are advancing at a good pace and the coordination to standardize the different norms is one of the main challenges at the regional level.

The supervision carried out from Panama to the regional groups established as parent banks not only comprises the assessment of their soundness and security in Panama, but also that of their operations in all cross-border jurisdictions. Thus, the supervising endeavor involves coordination with the area’s regulatory entities and the professional follow-up that ensures its financial soundness.

Another aspect that will, without a doubt, offer perspectives of immense financial feasibility to Panama will be the imminent widening of the Canal, a mega-project whose investment will have a material impact on Panama’s economic structure. The opportunities for a higher foreign trade financing level and support to large infrastructure projects enable us to know the country’s growth potential and the profitability advantages of the banking sector in the middle and long terms.

A Competitive Banking System

Panama’s Banking Centre development has become strong; its banking marketplace has consolidated as one of the most important ones in the region. The main Central American regional banking groups operate therein, as well as banking groups from important developed countries such as Citibank, HSBC, Banque Nationale de Paris, BBVA, Korea Exchange Bank, Bank Leumi Le-Israel and Banco Latinoamericano de Exportaciones (BLADEX), among others. It is worth pointing out that, traditionally, the Panamanian marketplace has required the physical presence of banking institutions for developing its operations. This sets it apart from other Off-Shore Centers.

The presence of international banks is accompanied by a strong local banking operation which competes without restrictions with international banks in local as well as international operations. During the last few years, Panamanian banks have successfully entered regional markets as Panamanian banking has become more internationalized. At this time, 76 banking institutions operate in the Banking Centre, which hire close to 13,400 employees with a payroll above US$ 165 million a year and an infrastructure investment of over US$ 350 million.

All these elements contribute to the fact that the International Banking Centre of Panama is the main component of financial intermediaries, and it represents 8% of Panama’s Gross National Product (GNP).

Prevention of Money Laundering and Terrorism Financing

Panama has a standard legislation that is constantly being updated and it has concentrated valuable efforts to combat and prevent the improper use of banking services in money laundering felonies and terrorism financing. Regulations have inserted rigorous criteria in function of policy: “Know your Client”, which enables banking institutions in Panama to operate as qualified intermediaries, complying with the standards of the Internal Revenue Service (IRS) of the United States of America.

The strengthening of regulation, supervision, transparency and commitment against money laundering and terrorism financing and its advances in said topic have caused Panama to be recognized by the main International Risk Rating Agencies and the Multilateral Credit Organizations.

These actions have positioned Panama as a regional standard, especially in advances against money laundering and terrorism financing. The role of the Superintendency of Banks of Panama has been essential in returning important banks to Panama’s international financial center. This endeavor has been emphasized by important media in the region.

This laudable management has led Mrs. Delia Cardenas, Superintendent of Banks of Panama, to become internationally renowned. She recently assumed the duties of Vice-Chair of the Association of Supervisors of Banks of the Americas - ASBA (September 2005 – September 2007), and until recently she was Madame Chair of the Caribbean Financial Action Task Force – CFATF (October 2004 – October 2005) and Madame Chair of the Central American Council of Superintendents of Banks, Insurance and Other Financial Institutions (August 2003 – August 2005).

Banking System: High Confidence Levels

The Superintendency of Banks of Panama contributes to minimize main risks and to ensure the security, soundness and transparency of the International Banking Centre.

The Banking Center continues to reveal itself as one of the main markets of the region because of its macroeconomic stability, the strength of its regulation, supervision, transparency and commitment against money laundering and terrorism financing. The reliability of international institutional deposits and Private Banking transactions in Panama has been confirmed, given that 42% of this type of transaction comes from countries with investment grade rating. Hence, Panama’s banking business keeps the excellence stamp that has become a tradition during the last decades.