Panama: Financial Sector Assessment Program - Technical Note on Financial Safety Net, Resolution, and Crisis Management

July 19, 2024

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International Monetary Fund. Monetary and Capital Markets Department "Panama: Financial Sector Assessment Program - Technical Note on Financial Safety Net, Resolution, and Crisis Management", IMF Staff Country Reports 2024, 235 (2024), accessed December 30, 2024, https://doi.org/10.5089/9798400284830.002

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Summary

This paper presents a technical note on financial safety net, resolution, and crisis management in Panama. Key institutional pillars of a financial safety net have not been established in Panama. An explicit industry-funded deposit insurance system should be established as a key element of an effective financial sector safety net in Panama. Superintendency of Banks of Panama (SBP) is the resolution authority for banks in Panama; the SBP relies on strong prudential supervision to avoid bank failures and remove weak institutions. The current approach to bank resolution has not changed since the 2012 Financial Sector Assessment Program and recent technical assistance missions. The legal framework underpinning SBP corrective actions, its overall powers and approach to handling bank insolvency has not changed since passage of the Banking Law in 2008. Panamanian authorities have undertaken a review of the current resolution framework and have determined there is need for improvement. The authorities should build upon current domestic and regional efforts, and develop their internal, interagency, and cross-border coordination and communication mechanisms for bank resolution and crisis management.

Subject: Bank resolution, Bank resolution framework, Crisis management, Crisis resolution, Financial crises, Financial sector policy and analysis, Financial sector stability

Keywords: Banco Nacional de Panamá, Bank resolution, Bank resolution framework, Central America, Crisis management, Crisis resolution, Deposit insurance system, Financial sector stability, FSAP assessment's finding, Global, IMF-World Bank Financial Sector Assessment Program, Staff team of the International Monetary Fund

Publication Details

Pages:

37
Volume:

2024
DOI:

https://doi.org/10.5089/9798400284830.002
Issue:

235
Series:

Country Report No. 2024/235
Stock No:

1PANEA2024005
ISBN:

9798400284830
ISSN:

1934-7685

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