The Banking Activity Report of the Superintendency of Banks of Panama (IAB, for its acronym in Spanish) highlights that, as of the fifth month of the year, the banks’ loan portfolios keep showing an upward trend, where all new loans segments have accumulated positive results.
The document explains that these performances are leveraged, among others, by the improvement of deposits and other sources of stable funding that grew during the period.
As of May 2022, the domestic loan portfolio recorded a gross balance of USD 56.07 billion, a USD 1.86 billion or 3.4% increase. The constant growth in the loan portfolio responds mainly to the boost made by entities in placing productive assets and preferential interest rate housing loans.
According to the IAB analysis, everything seems to indicate that employment recovery and economic improvement could be encouraging agents to have more financing.
It is also important to note that, as of May 2022, the International Banking Center (IBC) continued to show high liquidity and solvency ratios. The intermediation levels of the group of banks increased, which has allowed an improvement in profitability.
The banks making up the IBC have strong funding, consisting mainly of deposits, which gives great stability to their source of financing. Historically, funding diversification, deposit stability, and efficient use of hedging have contributed to mitigating liquidity risk. For this period, the liquidity of the Banking System reached 58.0%. Regarding solvency indicators, the capital adequacy ratio on risk-weighted assets was 15.46% at the end of 1Q2022, almost double the regulatory minimum of 8%. Currently, all banks running operations satisfactorily comply with the new liquidity and bank capital standards.
On the other hand, the assets of the International Banking Center, as of May 2022, totaled USD 136.47 billion, a USD 7.89 billion increase versus May 2021, i.e., a year-on-year growth of 6.13%, which was the result of a rise in the net loan portfolio (10.1%) and the securities portfolio (15.9%) that keeps growing but at a slower pace.
At the end of the January – May 2022 period, IBC banks obtained profits of USD 804.8 million. This figure represents a 54.7% increase versus the results obtained in May 2021.
For further information on the results of this report, please visit our website www.superbancos.gob.pa / Financial & Statistical.
