The Superintendency of Banks of Panama published its Financial Stability Report for the second half of 2024, assessing the resilience of Panama’s International Banking Center (CBI) to global and local risks. The report finds the banking system remained robust, with stress tests indicating no critical vulnerabilities under hypothetical macroeconomic scenarios, supported by strong capital and liquidity buffers. CBI net assets reached USD 156,392.8 million, up 6.0% year on year, which the report links to prudent management of capital, liquidity and risk exposures. Capital adequacy stood at 15.3%, nearly double the 8.0% regulatory minimum, while liquidity ratios (LCR) remained above Basel III standards; the analysis also considers potential vulnerabilities tied to sectoral indebtedness, credit conditions and banks’ ability to adapt under adverse conditions. Looking to 2025, the report flags geopolitical tensions, tighter financial conditions amid persistent inflation pressures and greater volatility in funding costs as potential headwinds for highly leveraged or externally funded sectors, while characterising these risks as contained given countercyclical provisions and asset diversification. The supervisor indicated it will continue active monitoring of financial conditions and further adoption of international standards, including Basel III guidelines, to mitigate systemic risk.

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