Money & Banking in Panama

Currency in Panama
The currency in Panama is the "Balboa" which has the same value as the US dollar. The dollar is legal tender in Panama, which doesn?t print bank notes but only mints its own coins. Coinage is either Panamanian or the U.S. equivalent in 50¢, 25¢, 10¢, 5¢, and 1¢.

Panama's Economy
Traditionally Panama's economy has been based on the service industry partly as a spin-off from the Canal and the ship registry. Panama's fleet is the largest in the world with twice as many ships as our nearest rival. Legal services, banking and insurance are key factors.

The Colon Free Zone, Panama's free trade zone, and the ports are also major elements of the economy.

Recently the economy has taken a major leap forward. Interest in Panama from abroad launched a boom in construction and real estate in Panama and major investments in many fields, including energy, tourism and telecomunications.

The $5.2 billion enlargement of the Panama Canal, including a third set of locks to accommodate post Panamax ships too wide for the present locks, has boosted the economy into greater acceleration and the outlook is for continued growth.

Panama's economy, measured through the Monthly Index of Economy Activity (IMAE), was growing at a rate of 10.21% in the early months of 2008 it was reported by the Comptroller's Office. Despite economic problems in the United States and the global financial crisis, the growth rate of the Panamanian IMAE has not slowed down yet.

The former president of the Inter-American Development Bank and the highest-ranking representative of the Ibero-American General Secretariat, Enrique Iglesias, spotlighted Panama as one of the countries that will meet the target of the Millennium Development Goals in 2015. According to Iglesias statistics show that poverty has fallen as a result of economic growth.

As to construction, hundreds of residential projects are underway throughout the country.

Panama is also experiencing high demand for immigration, both from those choosing to retire in Panama and others, mostly from North America and Europe and from neighboring countries, notably Colombia and Venezuela. Most are purchasing homes and other real estate in Panama.

Panama's other advantage, perhaps equal to the Canal, is the fact that the American dollar is accepted equally with the Balboa. Officially Panama's currency is the Balboa which exists in coinage form only, identical in size to U.S. coinage. But Panama doesn't print Balboa bills. The country uses American paper currency, and therefore the Balboa is automatically at par with the U.S. dollar. This situation derives from the unique association between the U.S.A. and Panama as a consequence of the Canal.

The Government in Panama
Decentralized Entities - The decentralized institutions fall under the responsibility of a ministry and follow the policies of the Government.  Some autonomous institutions are: National Mortgage Bank, National Bank, the Government Savings Bank, Social Security Organization, Regulatory Entity for Public Services, National Lottery, University of Panama, Technical University, and the Panama Free Zone.

Banks in Panama
Panama's reputation as a world banking center is undisputed. At recent counting, there were 78 banks registered in the country. Why so many banks in such a small country? Commerce through the Canal and the Colon Free Zone accounts for much of the activity as do Panama's strong Banking Secrecy Laws. Banks in Panama are regulated by the Panama Banking Superintendency in the following categories: 1. State; 2. General licence; 3. International licence and 4. Representational offices. On March 31, 2008, Panama's international banking assets amounted to almost $59 billion.

Official Banks in Panama
Banco Nacional de Panama
In 1904 the Panama National Bank was founded. There are branches throughout the country. Capital $500.000.000,00. Head office: Torre Banconal Vía España y Calle 55, Panama City Mailing address: 0816-05220 Panamá R.P. Teléfono 505-2000 / Fax 505-0236 www.banconal.com.pa

Official Banks in Panama
Caja de Ahorros Panama
Panamanian capital. Operating in Panama since 1904 with forty two branches. Capital $97.084.902,62. Head office: Vía España Ave. Manuel Espinoza, Panama Cit. Mailing address: Apdo 1740, Zona 1 Panama R.P. Teléfono 508-1000 Fax 508-1822. www.cajadeahorros.com.pa

General Licensed Banks in Panama
International Bank Inc.
Nicaraguan capital. Operating in Panama since.1995 with ten branches. Capital $113.565.253 Head office: Calle Aquilino de la Guardia, Edif. Bac Credomatic, Panamá City. Mailing address: Apdo.6-3654 El Dorado Panama R.P. Teléfono 206-2700 Fax 214-7045. www.bac.net

General Licensed Banks in Panama
BanCafe Colombia
Colombian capital. Operating in Panama since 1988 with one branch. Capital $6.000.000,00 Head office: Ave. Manuel Maria Icaza, Cl. 52 Este No. 18, Campo Alegre. Panama City. Mailing address: 0834-00384 Panama R.P. Teléfono 264-6066 Fax 263-6115.
www.bancafe-pa.com

General Licensed Banks in Panama
Banco Bilbao Vizcaya Argentaria
Spanish capital. Operating in Panama since 1983 with 15 branches. Capital $28.700.000,00. Head Office: Calle 42 y 43 y Ave. Balboa, Panama City. Mailing address: 0816-03396 Panama R.P. Teléfono 207-2100 Fax 207-2200. www.bbbvapanama.com

General Licensed Banks in Panama
Banco General Panama
Panamanian capital. Operating in Panama since 1955 with 56 branches. Capital $547.500.000,00. Head office: Urbanización Marbella, Cl. Aquilino de la Guardia, Panama City. Mailing address: 4592 Panama 5, Panama R.P. Teléfono 303-5001 Fax 265-0210. www.bgeneral.com

General Licensed Banks in Panama
ICBC Taiwan
Republica Popular China. Operating in Panama since 1994 with one branch. Capital $11.060.000,00. Head office: Calle Manuel Ma. Icaza, Panama City.Mailing address: 0823-01030 Panama R.P. Teléfono 263-5522 Fax 223-9960

General Licensed Banks in Panama
Credit Corp Bank Panamanian capital.
Operating in Panama since 1993 with 17 branches. Capital $24.050.000,00. Head Office: Plaza Credicorp Bank, Panama. Ave. Nicanor Obarrio, Panama City. Mailing address: 833-0125 Panama R.P. Teléfono 210-1111 Fax 210-0412. www.credicorpbank.com

General Licensed Banks in Panama
Mega International Commercial Bank Co. Ltd.
Republic of China (Taiwan). Operating in Panama since 1974 with one branch. Capital $10.000.000,00. Head office: Cl. 50 y esquina Margarita de Vallarino, Edif. ICBC No. 74 Panama City. Mailing address: 0832-01598 Panama R.P. Teléfono 263-8108 Fax 263-8392. www.megabank.com.tw

General Licensed Banks in Panama
Banco Cuscatlán de Panamá, S.A.
El Salvador. Operating in Panama since 2003 with 20 branches. Capital $42.000.000,00. Head office: Cl. 50, Edif. Cuscatlan, Panama City. Mailing address: 1828 Panama 1, Republic of Panama Teléfono 208-8300 Fax 269-1537. www.bancocuscatlan.com

General Licensed Banks in Panama
Banco Uno, S.A.
Nicaraguan capital. Operating in Panama since 1994 with 19 branches. Capital $42.194.000,00. Head office: Cl. 50 y 84 Vía Israel, San Francisco, Panama City, mailing address: 3844 Zona 7, Panama R.P. Teléfono 270-5899 Fax 270-5800. www.bancouno.com.pa

General Licensed Banks in Panama
Bank Leumi-Le Israel, B.M.
Operating in Panama since 1982. Capital $10.000.094,74. Head office: Cl. Manuel Maria Icaza, Edif. Grobman No. 10, Campo Alegre, Panama City. Mailing address: 0819-05593, Panama Rep. de Panama Teléfono 263-9377 Fax 269-2674.

General Licensed Banks in Panama
BNP Paribas Sucursal Panamá
French capital. Operating in Panama since 1975 with one branch. Capital $10.000.000,00. Head office: Vía España #200 Panama City. Mailing address: 0816-07547 Panama R.P. Teléfono 263-6600 Fax 263-6970. www.bnpparibas.com.pa

General Licensed Banks in Panama
Citibank, N.A.
United States capital. Operating in Panama since1904 with four branches. Capital $10.285.698,14. Head office: Cl. 50, Edif. Plaza Panama, piso 11 Panama City. Mailing adress: 0834-0555 Panamá, Rep. De Panamá. Teléfono 210-5900 Fax 210-5904. www.citibank.com.pa

General Licensed Banks in Panama
HSBC Bank (Panamá), S.A.
Netherlands capital. Operating in Panama since 2004 with 19 branches. Capital $.287.301.957,45. Head office: Ave. Aquilino de la Guardia y calle 47 Este, Urb. Marbella, Panama City. Mailing address: 0834-00076, Panama, Rep. de Panama. Teléfono 263-5855 Fax 206-6300. www.pa.hsbc.com

General Licensed Banks in Panama
Korea Exchange Bank, Ltd.
Operating in Panama since 1980. Capital $10.000.000,00. Head office: Edif. Torre Global Bank, Cl. 50 Urbanización Obarrio, piso 19, Ofic. 1902, Panama City. Mailing address: 0823 05773 Panama R.P. Teléfono 340-3360 Fax 340-3359. www.koexbank@kr.co

General Licensed Banks in Panama
Primer Banco del Istmo, S.A.
Panamanian capital. Operating in Panama since 1984 with 38 branches. Capital $577.323.112,20. Head Office: Cl. 50 y 77 Este San Francisco, Panama City. Mailing address: El Dorado 6-3823 Panama Rep. of Panama. Teléfono 270-0015 Fax 270-1706. www.banistmo.com

General Licensed Banks in Panama
The Bank Of Nova Scotia.
Canadian. Operating in Panama since 1974 with three branches. Capital $10.000.000,00. Head office: Ave. Federico Boyd y Cl. 51 Panama City. M ailing address: 0816-01999 Panama R.P. Teléfono 208-7700 Fax 208-7747. bnspanama@scotiabank.com

General Licensed Banks in Panama
Towerbank International, Inc.
Panamanian capital. Operating in Panama since 1971 with one branch. Capital $42.800.000,00. Head office: Cl. 50 y Beatriz M. de Cabal, edif. Tower Plaza, Panama City. Mailing address: 0819-06769 Panama R.P. Teléfono 269-6900 Fax 269-6800. www.towerbank.com

General Licensed Banks in Panama
Banco Nacional de Argentina.
Operating in Panama since 1977. Capital $3.000.000,00. Head office: World Trade Center, piso #5, Ofic. 501, Panama City. Mailing address: 0832-1528 Panama R.P. Teléfono 269-4666 Fax 269-6719.

General Licensed Banks in Panama
Banco Santander (Panamà), S.A.
Spanish capital. Operating in Panama since 1973. Capital $.942.100,00. Head Office: Torre ADR, Ave. Samuel Lewis Panama City. Mailing address: 1630 Panamá R.P. Teléfono 264-7678 Fax 263-7534. www.bancosantader.com.pa

Banks with International licence
Banco Colpatria
Colombian. Operating in Panama since 2005 . Capital $3.570.000,00. Head office: Edif. World Trade Center, Ofic. 1501 Marbella, Panama City. Mailing address: 0832-01559 Panama R.P. Teléfono 301-0717. Fax 301-0701. www.colpatria.com

Banks with International licence
ES Bank
Portugal. Operating in Panama since 2002. Capital $30.000.000,00. Head Office: Marbella Cl. 53 World Trade Center, Piso 19, Panama City. Mailing address: 0832-0847 Panama R.P. Teléfono 265-3174. Fax 265-8142. www.gespanama.com

Banks with International licence
Natixis
French capital. Operating in Panama since 2007. Capital $8.000.000,00. Head office: Cl. 50 Torre Global, Piso 26 Panama City. Mailing address: 0833-00092 Panama R.P. Teléfono 206-6400 Fax 340-3239. www.natixis.com

Banks with International licence
TAG Bank, S.A.
Brazil. Operating in Panama since 2006. Capital $.893.251,61. Head office: Cl. 53 marbella, MMG Tower, Piso 6. Panama City. Mailing address: 0832-00367 Panama R.P. Teléfono 294-1300 Fax 294-1301.

Banks with International licence
Banco do Brasil
Operating in Panama since 2007 with ten branches. Head Office: Ocean Business Plaza, Ofic. 1202, Ave. Aquilino de la Guardia y Cl. 47 Tel : 340-6414/340-6415/340-6416/340-6417 Fax: 340-6414/340-6415/340-6416/340-6417. www.panama@bb.com.br

Banks with International licence
Bank Hapoalim, B.M.
Operating in Panama since 1981 Head office: Edificio Globus, Piso 5, Ave. Samuel Lewis Tel : 263-7222 / 263-7446 Fax: 263-0059

Banks with International licence
Norfolk And Hampton Bank.
Operating in Panama since1992 Head office: Torre del Banco Continental, Calle 50 y Aquilino de la Guardia, Piso 23 Tel : 303-7000 Ext. 7611 Fax: 223-4587

Advantages of the Colon Free Zone
Panama Free Zone, one of Panamaçs free trade zones, has a number of elements which support commercial activity on such differing levels as transport and financial operations. Panama's main cargo airport is Tocumen International and there are five major seaports with every modern cargo handling facility.

Freight moves by air, land, rail and sea. Every year, over 12,700 cargo vessels cross the Canal under the flags of over 84 nations. Panama has the world's largest merchant fleet, with a registry of more than 7,000 ships. Many of them stop for cargo and buy their supplies from chandlers operating from The Colon Free Zone.

More than 38 international passenger and cargo airlines use the Tocumen International Airport . The majority share in the cargo generated through The Colon Free Zone and a number of cargo airlines use the airport for special flights.

Finally, Panama's International Banking Center with over 87 banks from around the world, with deposits totaling U.S.$32 billion is a great advantage. More than 25 banks have branches within the Free Zone itself.    All of these advantages, together with the national currency, the Balboa which is permanently at par with the American dollar, which is legal tender in the country and for which   there are no exchange restrictions, make an ideal climate for international commerce.

A modern communications system and an efficient tourism service add to the facilities enjoyed by the Panama Free Zone users

Money in Panama
Panama uses the actual U.S. Dollar as national currency. Panama has no currency-exchange controls or restrictions so capital can flow freely in and out of the country. Panama is famous as an international banking center, with nearly all of the major players having a local presence here. Panama has no Mutual Legal Assistance Treaties for sharing banking information with other countries. Panama does not recognize outside court rulings. Within the country, revealing banking information to third parties is a crime which is punishable by imprisonment, which is attractive to those buying real estate in Panama

Taxation in Panama
Panamanian IBC's and Private Interest Foundations are liable for no - or very low - income, capital gains, share or shareholder, inheritance or sales tax (to name a few). Panama does not have tax treaties with any other countries and has enacted comprehensive legislation designed to keep your assets and information anonymous and secure. Income does not have to be reported to the Panamanian government.

Citibank swallows Cuscatlan and Uno
Amid the global financial turbulence, the names of the banks Uno and Cuscatlán will disappear from the Panamanian market to give way to the Citibank brand following the merger with this entity. "Stationery, checkbooks, Web pages, and the canopies of these two banks in Panama will bear the name of Citibank SA and run under a single operating platform," said Edgardo Del Rincon, director of Citi Group for the integration of Financiero Uno and Grupo Cuscatlan.

GDP up, inflation up
The Ministry of Economy and Finances (MEF) has revised upward two of its key macro-economic projections: the gross domestic product (GDP), which is the main indicator that measures the growth of the economy, and the consumer price index (CPI), which registers inflation. In the former case, the news is good: the GDP will grow "not less than 9% this year," said the head of the MEF, Minister Hector Alexander.

Investment Propels Panama
Investment propels a real estate boom for Panama
The Christian Science Monitor / Sara Miller Llana
The hilltop view overlooking the former Howard US Air Force Base in Panama says it all. The vacant barracks will be the site of a $10 billion minicity slated to be the size of Central London. Just beyond the hills, the Panama Canal is undergoing a $5 billion expansion, and in the background cranes hang over new skyscrapers that seem to rise every week.

Panama, it seems, is in its prime.
Once overlooked as nothing but a canal, this tiny Central American nation of 3 million is attracting residents, businesses, and investors the world over. Some are seeking a haven from political situations in the region. Others are jumping on what they see as one of the best investments around. But as the government markets itself as the Latin American lodestone, many caution that the city is growing too quickly out of its own infrastructure.

"We are the geographic hub of the Americas," says Ivan Carlucci, the president of the Panamanian Association of Real Estate Brokers and Developers, adding that 11,000 new units will come online this year. He boasts that 99 percent have already sold. Some say that speculators have fueled the boom, but Mr. Carlucci says he expects the real-estate market to maintain its momentum because of other large infrastructure and industrial projects throughout the country. "We will be sustained by all the other aspects."

The most visible changes to Panama City are the homes rising for new residents. According to the Ministry of Housing, nearly 400 projects are under construction, with permits, or awaiting approval. "This is extraordinary, we've never seen this before," says José Batista, the director of urban planning in the Ministry of Housing.

Venezuelans help fuel the boom
New residents include Venezuelans, who disagree with the direction of Venezuelan President Hugo Chávez's administration. "The day after Chávez was sworn in, we had Venezuelans in here looking for office space and apartments," says José Manuel Bern, director of sales and projects for Empresas Bern, one of the city's oldest developers. "We are even starting to receive some people from Ecuador."

They also include American retirees and couples looking to invest, who list Panama's relative security, prospects for growth, and use of the dollar in all transactions as top draws. Reggie and Cherie Flagg, an American couple from Florida, bought a building in the historic part of Panama City this year.

They feel safe in Panama, both in the short and long term, says Ms. Flagg, who says she would not consider, for example, Nicaragua, where she says political instability could undermine their economic investment. "The Panama Canal makes constant money, and now it's going to get bigger."

Bigger canal to boost growth
The economic indicators seem to back up their enthusiasm. Panama grew by 8 percent last year, one of the highest rates in the region. In 2006, new foreign direct investment doubled from the year before. According to the United Nations Economic Commission for Latin America and the Caribbean, it represented 16 percent of GDP in 2006, double that of any other country in the region.

The expansion of the canal will create tens of thousands of jobs and contribute $1.5 billion to the nation's treasury by its completion in 2015.

Panama Trade
U.S.A. bank offers U.S. mortgages for property purchased in Panama
For the first time in Panama's history, a U.S.A. bank will be giving U.S. citizens and residents the opportunity to acquire US mortgages for property purchased in Panama!

Up until now, U.S. citizens and residents have had to either apply for a tedious local loan or pay cash (from their personal savings or equity line) when purchasing in Panama.

Local loans can be frustrating. Long application process, hidden fees, FECI, 65 year age limit, shorter terms, inability to deduct local bank interests from taxes and life insurance requirements are some of the features which differentiate a typical U.S. loan from a Panama bank loan.

The U.S. loans are typically 30 year terms, no age limit, no life insurance required, very competitive rates, fixed rates for specific terms and tax deductible payments.

Mortgage International Brokers (MIB) opened a "representation office" this week at the World Trade Center. They will be taking applications and processing them in the U.S. exactly as any U.S. loan would be processed.

This is very exciting news for U.S. citizens and residents planning to purchase a home, second home, apartments, condos, etc. in Panama.

The news was announced at ACOBIR's (Association of Real Estate Agents) assembly last week. Real estate brokers are excited that they can finally count on a U.S. Bank to offer U.S. mortgages to their U.S. customers.

Panama Private Interest Foundations
A Panama Corporation, in conjunction with a Panama Private Interest Foundation is a dual tool with which very wealthy and also only moderately wealthy people protect their assets and is one of the reasons why Panama's banks hold total assets of over $55 billion.

The country's unique laws allow the strongest asset protection in the world, together with strict bank secrecy and anonymous legal entity laws, Panama being one of the few countries allowing "beares shares".

The Private Interest Foundation law is modelled on similar laws in Switzerland, Liechenstein and Luxembourg. The foundation can be used as a holding company for a corporation which hold the assets.statistics show that poverty has fallen as a result of economic growth.

Most offshore tax haven banks around the world require knowing the true owner of an account. A foundation may open a bank account in Panama using nominee council members and keeping the true owners anonymous. The only exception is if a foundation is involved in terrorism or money laundering, in which case a Panamanian judge can sign a court order requiring the bank to disclose records of the account.

Legacies and bequests can be handled within the foundation, avoiding probate, gift taxes, estate taxes, inheritance taxes or legal delays.

Information provided by www.panamabusinessandtravel.com.  A Focus Publications company.  The USA REALTY GROUP  recommends www.panamabusinessandtravel.com to our readers to find information regarding the country of Panama.  The site offers information on Panama in both business and tourism.