Gray and Co, lawyers, abogados, international legal services, Panama City

Beth Anne Gray J., LL.B. (Hons.)

P.O. Box 832-0816 - World Trade Centre - Panama City - Republic of Panama

International Legal Services

 

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Banking & Finance 

Panama's International Banking Centre, the most modern and successful in Latin America, offers investors over 100 Banks from more than 32 countries around the world. Banking has always played an important role in Panama.  Banks from Asia, Europe and the Americas carry out their operations to and from Panama, not only as a consequence of the favourable environment established by the Banking Law, but also due to a series of comparative advantages facilitating banking activity.

The Banking Law contains provisions intended to guarantee banking confidentiality, which forbid banks to disclose details of their clients’ transactions to both national and foreign authorities other than in special circumstances. This secrecy is the major determinant of Panama’s obvious success as the most important financial centre in Latin America. Other factors have also played a part, including the absence of any currency restrictions, the free circulation of the US dollar as a legal tender, the free international movement of capital, a territorial tax system and the lack of a central bank in charge of currency issuance.

Panama's economic stability is largely due to it's economy being tied directly to the United States dollar.  The Panamanian Currency is the Balboa (B/.) which has an exchange rate of US$1.00 = B/.1.00 (fixed exchange since 1903). 

The principal legislation in banking is the Banking Act (1998), which is set out in our resources section - The Banking Act (*.pdf) Other relevant legislation is Law 41 of 2001, which introduces a number of anti-money laundering measures. 

Under the Banking Act, a bank with a General License must have a minimum of US$10 million in capital and the banking regulator (the Banking Superintendent), whose office is independent of central government, has wide powers of examination and investigation.  Nevertheless, the Superintendent's authority is subject at all times to strict compliance with the country's firm rules of confidentiality. Heavy criminal and civil sanctions can be imposed on bankers as well as the Superintendent (or employees thereof) for wrongful disclosures. However, although confidentiality is enshrined in the banking law, a prima facie case proving funds are illicit will not protect criminals from exposure (law 41, 2001).

In addition to increased investigative powers for the Superintendent, the new banking law has tightened general controls and regulations and brought the country's supervision more in line with the regulatory standards found in the European and American banking centres. The introduced legislation uses the guidelines of the Basle Committee on Banking Supervision and requires all banks that have a General License (unrestricted domestic or international commercial banking activity) to maintain at all times capital that is equivalent to at least 8% of total assets, weighted in proportion to respective risks.

Banks in Panama may have a General License, an International License or simply a Representative office license. 

Although we are happy to assist clients with establishing commercial and personal bank accounts in Panama, we do not provide nominee signatories on the accounts.  Have a look at Opening a Corporate Bank Account for more information regarding the requirements for opening accounts in Panamanian banks. For information regarding banks in Panama, please have a look at our links page.  For advice regarding banking transactions, please do not hesitate to contact me.

Securities Law

In 1999, Panama adopted the Securities Act (Decreto-Ley 1 de 1999).  This Act replaces the 1970's legislation which regulated the securities market.  For more information regarding the Securities Act please see Panamanian Securities Legislation:  the Road to Transparency and Accountability.

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