Banking Equilibrium Calificadora de Riesgo S.A. Ernesto Bazán banking reserves reserve assets financial crisis liquidity (money) Annual results and outlook Credit Recovery Inflation Reserve requirements Risk Rating Superintendency of Banks of Panama bank bank credit

Panama: New Calculation of Capital Adequacy Ratio

The new provisions for calculating Capital Adequacy Ratio will be coming into force in Panamanian banks on April 1.

Tuesday, March 31, 2009

©image: Jennifer Rensel

Assets that under the current rules were weighted at 100%, with the change will be weighted at 125% and 150%.

The general manager of Equilibrium risk rating, Ernesto Bazán, stated in an article in Prensa.com: "This means that assets, as measured by their risk will be higher and, therefore, the capital adequacy ratio of the Panamanian banking system will be reduced globally. It is currently at 14.3% and it could drop to 13.8% or less with the change."

Source: Prensa.com

Key entities

Equilibrium Calificadora de Riesgo S.A. Ernesto Bazán

Countries

Panama

Insight

banking reserves reserve assets Banking

Panama's Bank Profits to Decrease in 2009

March 2009

Equilibrium, a risk rating firm, predicts a slowdown in the Panamanian banking sector in 2009.

Equilibrium, a risk rating firm and a subsidiary of Moody's Investors Service, Inc., believes that credit stagnation, lower margins and higher provisions will push the results of the Panamanian banks downward.

Guatemalan Banks to Cover Currency Exchange Risk

December 2009

Banks in Guatemala will have to increase their capital from 10% to 14% when granting loans in U.S. dollars to people with incomes in quetzales.

Banking Superintendent Edgar Barquín explained that the measure, which affects a third of the entire loan portfolio in dollars -$982 million-, will force banks in the system to increase their capital in $48 million.

Modification to Banking Regulations in Guatemala

December 2008

Tomorrow the Superintendence of Banks (SIB) will request that the Monetary Board approve a modification of the Regulations for Credit Risk Management.

Even though bank portfolios in arrears are not at a critical level, the SIB will request that the Monetary Board make the changes to the rules in order for banks to increase their reserves for bad debts (loans).

Panamanian Banking Semi-annual Analysis

October 2009

A report by risk rating company Equilibrium (Moody's), analyzes the sector's main indicators for the first half of 2009.

Assets and Loan Portfolio
By the end of the first half of 2009, the Banking system reported $63.725 million in assets. The loan portfolio makes up 63.2% of the total ($40.291 million).

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