Banking

There are over 60 banks in Panama because Panama is the top banking and financial center in Latin America. The reasons go back to Panama´s friendly taxation system, i.e. banks do not pay any tax on their international profit from foreign sources. This means that, of course, banks can invest worldwide and not pay local tax. This has firmly placed Panama as a Banking hub of Latin America. In fact, Panama has been called the Switzerland of Latin America.

Complete list of Panamanian banks:

1. Banco Nacional de Panamá.
2. Caja de ahorros.
3. Bac International Bank, Inc.
4. Banco Aliado S.A.
5. Banco Azteca (Panamá)
6. BBP Bank S.A.
7. ScotiaBank.
8. Banco Davivienda.
9. Banco Delta
10. Banco de Bogotá.
11. BANISI.
12. Banco Ficohsa.
13. Banco G&T Continental.
14. Banco General.
15. Banco Internacional de Costa Rica.
16. Banco Lafise Panamá.
17. Banco Latinoamericano de Comercio Exterior (BLADEX).
18. Banco La Hipotecaria.
19. Bancolombia.
20. Pacific Bank.
21. Banco Panamá.
22. Banco Pichincha.
23. Banco Prival S.A.
24. Banesco.
25. Bank of China Limited.
26. BCT Bank.
27. BI-Bank
28. Canal Bank
29. Capital Bank Inc.
30. Citibank.
31. Credicorp Bank.
32. FPB Bank Inc.
33. Global Bank Corporation
34. Banistmo.
35. Keb Hana Bank.
36. Mega International Commercial Bank Co. Ltd.
37. Mercantil Banco.
38. Metrobank.
39. MMG Bank Corporation.
40. Multibank.
41. St Georges Bank.
42. Towerbank.
43. Unibank, S.A.
44. Atlas Bank.
45. Andbank.
46. Atlantic Security Bank
47. Austrobank Overseas
48. BAC Bank Inc.
49. Banco Credit Andorra.
50. Banco Davivienda International.
51. Banco de Bogotá.
52. Banco de Crédito del Perú.
53. Banco de la Nación Argentina.
54. Banco de Occidente.
55. Banco Internacional del Perú.
56. Bancolombia.
57. BHD International Bank.
58. Inteligo Bank Ltd.
59. Es Bank
60. GNB Sudameris Bank.
61. GTC Bank Inc.
62. ITAU Panamá.
63. PKB Banca Privada.
64. Popular Bank Ltd Inc.
65. Tag Bank
66. BPR Bank

Most serious banks prefer you or your corporation (preferably both) to be resident in Panama and to be tax resident in Panama. This saves them the huge paperwork of having to report to other countries under the CRS and makes the relationship far smoother and easier. If you as the UBO of your company do not have tax residence in Panama, then generally the bank will request you to identify or certify the place of your tax residency, which is the place the bank will be obligated to report to. This is the same requirement for most countries (except the United Sates and several others) who have been forced by the OECD to report bank accounts to the place of residency according to OECD regulations.

Panama is an onshore banking destination with all the advantages of an offshore due to the territorial taxation system. Further, many Panamanian banks have highly qualified international staff from Switzerland and other highly developed countries to take care of their foreign and expat clients. It is usually important for you to visit the bank so that a professional who can speak your language can be assigned to you.

There are numerous types of banking options however, below we deal only with the most common:

The brokerage Account in Panama

There are a large variety of banks and brokerage houses which offer brokerage accounts to both residents and non-residents. The advantages of having a brokerage account in Panama include the following:

• Having a brokerage account avoids most of the major risks of bank insolvency or collapse since what you are buying are shares or bonds and since, for example, bonds are securities. The only function of the bank or broker is to hold the securities in the name of yourself or your trust. That means you can move the securities to another custodian (bank or broker) without moving funds so that even if the bank collapses the securities cannot be touched. Very few people know about this aspect of law, because under international law, if the bank holds money in its account, it is considered money belonging to the bank, whereas if the bank holds securities it is holding the securities as a custodian or trustee for you. This makes all the difference, if the bank is put into liquidation, administration or insolvency because of government problems, debt, or any other reason, you cannot lose your securities but you will almost surely lose your bank deposit (remember the Cyprus crisis).
• Panama is the ideal place to hold a brokerage account since there is no tax in Panama on such investment accounts. Further you can buy, for example, bonds such as bonds of Panamanian airport and other high yielding bonds that can pay up to 7% yearly interest which is much higher than bank rates and indeed safer in most cases. Indeed, most banks simply take your deposits and then invest them into the bond market themselves and live off the difference in the interest. A brokerage account allows you to cut out the middleman. Panama has a large number of highly experienced bond and equities brokers that can give you their expertise on the Latin American, European, US and even Asian markets at far less transactional cost than in many other places and at far lower entry fee.
• You can create a borrowing facility against your bond investment which means that you can, for example, have a steady income of say 1,000,000 at 7%. If you urgently need money to invest in other investments without touching your portfolio, you can borrow against your own funds at say 2%. This allows you to diversify your portfolio very quickly when the opportunity arises whilst not risking the already invested capital. 

There are many other advantages which our experts can explain to you, the good news is that whilst most brokerages will require 1,000 000 as a minimum to open an account, Mundo has an introductory offer from its expert brokers in Panama for as little as 100,000 USD.

Please click here  and receive a complete info pack.

Private banking in Panama

Private Banking is the term used for high-net-worth clients who open a special account with their bank that gives them the elite of banking services with a highly competent bank manager to take care of their needs. This can include brokerage accounts and other investment products such as precious metals storage, special concierge services, multi-currency and forex accounts and many other financial services. Usually private bank account holders get access to deals and services that ordinary customers do not. Whilst most Swiss banks only agree to open accounts of this nature for clients with wealth in access of 1 million, certain private banks in Panama will agree to do this for much less provided that they are sure that the client will develop a relationship with them over time.

Panama is becoming the Switzerland of Latin America and therefore private banking is certainly a service worth considering. Another advantage is that many banks will be happy to open accounts for trusts and foundations which will mean you can have an intergenerational asset protection and succession plan with a reliable bank in Panama.

It is easier and indeed better to open private bank accounts if you are a Panamanian resident, however this is not a requirement for most banks.

For info package please click here.

Corporate banking in Panama

Because Panama has no currency restrictions and no tax on wordwide income, it is an ideal corporate banking center for goods and services. Panamanian banks will accept foreign and domestic companies as clients but these days they tend to prefer domestic companies with substance.

Panamanian banks offer multi-currency accounts in euro, British pound, US dollar and recently even in yuan.

Whilst purely offshore companies can still open bank accounts in Panamanian banks, usually because of the OECD BEPS initiative, Panamanian banks prefer at least the following:

• A Panamanian company with an operating certificate and an office (this allows for tax residency and reporting to Panama only as an exporting company).
• The UBO to be a director with Panamanian residency or to use a professional Panamanian director.

For info pack please click here

Click here for an interview with our expert Manuel Barrachina on banking options in Panama.