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Banking Sector Growth and Performance

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The net profit of Panama's banking grew by 40% in January

Sun, 04/29/2018 - 14:07

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The net profit of the International Banking Center (CBI) of Panama reached $ 183 million at the end of January 2018, 40 percent more than in the same month of the previous year, reported today the Superintendency of Banks.

"The efficiency index of the CBI, in the period that covers January, continues to present the positive trend that has been seen consistently in recent months," the regulator said in a public statement on Friday.

It said that the increase in net income was due to increases "in non-recurring financial income, such as the purchase and sale of securities and operations with derivative instruments."

It explained that "the decrease in the cost of provisions" due to the entry into force of specific rules for the sector allowed banks "to make an adjustment against retained earnings, which has favored the performance of the first month of the year."

The result was also influenced by the 6.9 percent increase in credit to the private sector, guided by mortgage loans (9 percent) and personal loans (8.4 percent).

"The source of growth of the local operation is directly associated with an increase in domestic private deposits of 4.7 percent, especially in term deposits," the Superintendency said.

The credit business maintains a positive rate in economic sectors that show dynamism, such as construction (6.2 percent), personal consumption (7.8 percent), agriculture (10.6 percent) and mortgages (8.8 percent), among others, it said.

The profits of the International Banking Center of Panama, made up of nearly a hundred institutions, totaled 1,797 million dollars at the end of 2017, with a "record" growth of 17.9 percent with respect to the previous year, according to data from the Superintendence.

Panama's economy grew by 5.4 percent of gross domestic product (GDP) in 2017, up from 5 percent the previous year, driven by activities related to the external sector such as the interoceanic canal and air services and financial institutions, reported the National Institute of Statistics and Census (Inec).

The statistical agency stated that the annual Gross Value Added of financial intermediation increased by 5 percent due to the performance in the financial services of the International Banking Center, which grew by 4.3 percent given the increase in local financial services.

 

http://www.panamatoday.com/economy/net-profit-panamas-banking-grew-40-january-6741

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Banking Center installed in Panama grew by 19.1% in the first two months of 2018

Thu, 05/10/2018 - 22:17

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The profit of the International Banking Center (CBI) of Panama increased at least 390 million dollars, or 19.1 percent, in the first two months of 2018, compared to the same period of 2017 (327 million), despite the fact that the asset level fell by 1.9 percent, an official source reported today.

The Superintendency of Banks of Panama (SBP) reported that "this result is attributed to the ability to generate profits measured through operational income, which continues to reflect a positive growth trend."

This is "characterized by the capture of local deposits of individuals, and a sustained growth of the domestic credit portfolio destined to the private sector that increased 6.7 percent, when compared with similar period of the previous year".

It highlighted that the performance of the domestic credit portfolio was driven by sectors associated with personal banking products, especially in the mortgage (7.8 percent) and personal loans (10.7 percent) sectors.

The interim construction financing "reflected growth due to the fact that disbursements continue to be generated in the commercial construction and development projects of the residential construction market," it said.

"This good performance resulted in the Balance and Income Statement of the CBI (almost a hundred international and national banks) registering a total of assets of 118,083 million dollars", 1.9 percent less.

The drop with respect to the same period of 2017 is of 2.34 million dollars, "in response to the reduction of the external loan portfolio, by a more conservative position in markets and customers with greater credit risk".

In this process, it explained, "the lowest level has also affected the liquid placements of the external component, due to the redirection of resources in search of more profitable operations, a strategy that has allowed banks to improve their levels of profitability, without compromising the financial health of the CBI".

It is proven by the results of the CBI at the end of last February, which "shows that the banks maintain robust indicators of financial soundness, mainly those of legal liquidity (57.7 percent) and solvency (16.1 percent), in almost twice the minimum required by regulation".

The report adds that the national economic activity measured through the Monthly Index of Economic Activity (IMAE) reflects an increase of 3.8 percent for the first two months of the year, compared to the same period of 2017.

"Certain economic sectors related to domestic demand show a better performance as in the case of commercial activity and certain branches related to the chicken and beef and pork processing industry," as well as "exporting sectors of services such as case of the port sector".

But it qualifies that "some export sectors of services related to tourism and cargo transit through the Panama Canal reflect a more moderate dynamic".

Consumer prices in Panama remain stable with a slight growth of 0.4 percent in February compared to the same month last year.

The groups that showed increases in the Consumer Price Index (CPI) last February compared to January 2018 were education (3.4 percent); restaurants and hotels (0.8); furniture, household items and ordinary household staples (0.7 percent), among others.

 

http://www.panamatoday.com/economy/banking-center-installed-panama-grew-191-first-two-months-2018-6823

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A 19% gain in banking in two months is huge. What is the real story here? Is Panamá setting itself up — or being set up — for another Panamá Papers incident? Say, Panama Papers, Round Two?

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Bank Profits Improve in Panama

Entities in the International Banking Center generated profits of $670 million in the first four months of the year, 11% more than in the same period in 2017.

Friday, July 20, 2018

The April result for the Banking Center, which includes general and international license banks, shows growth of 10.6%. The increase in Net Income is the result of increases in non-recurring financial income, such as the purchase and sale of securities and transactions with derivative instruments, and on the other hand, a decrease in provision expenses, as a result of the entry into force of IFRS 9, which has allowed banks to make an adjustment against retained earnings, informed the Superintendency of Banks.

It is worth noting that the efficiency index of the International Banking Center, in the period that covers April, continues to show the positive trend that we have seen in a consistent manner in recent months. In this month, it has been favored by diversified revenues, the report adds. 

"It should be noted that banks have been improving their level of recurring income, which has been accompanied by the development of more robust and profitable franchises. We believe that revenues will continue to be strengthened thanks to the improved net interest income, which grew 4.0% during the first quarter of 2017, and the low operating expenses that occur in a context where entities are trying to improve their business models in the midst of increasing competition among banks." 

See full report (In Spanish).

 

https://www.centralamericadata.com/en/article/main/Bank_Profits_Improve_in_Panama

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