Superintendencia de Bancos de Panamá (SBP)

Overview

The Superintendencia de Bancos de Panamá (SBP) is the primary regulatory and supervisory authority for banks, banking groups, and fiduciary entities operating in Panama. Established to ensure the soundness and efficiency of the Panamanian banking system, the SBP oversees one of the most significant international financial centers in the Western Hemisphere.

Current Leadership and Institutional Structure

Superintendent: Milton Ayón Wong has held the position of Superintendent of Banks of Panama and brings extensive experience from the private sector. His background includes senior positions at Real Panameña de Seguros, Banco Real, ABN AMRO Bank, KPMG Panama, and Credicorp Bank. As Superintendent, Wong chairs the Financial Coordination Council (CCF), serves as a member of the National Commission against Money Laundering, Financing of Terrorism, and the Financing of the Proliferation of Weapons of Mass Destruction (CNBC), and acts as Vice President of the Board of Directors of the Central American Council of Superintendents of Banks, Insurance, and Other Financial Institutions (CCSBSO).

Board Leadership (2025-2026 Term): Felipe Echandi Lacayo serves as Chair of the Board, while David Davarro Palacios serves as Secretary.

Panama as an International Banking Centre

Panama operates one of the most modern and successful international banking centers in Latin America, established through government promotion of offshore banking beginning in 1970. The policy granted international transactions tax-exempt status and removed regulatory restrictions, enabling Panama to attract substantial foreign capital and become Latin America's largest financial center by the 1980s.

Structural Characteristics:

• Panama is a fully dollarized economy (official currency: U.S. dollar since 1904)
• No central bank; the National Bank of Panama and SBP manage regulatory functions
• As of 2024, 64 registered banks operate in the system
• The International Banking Center (CBI) comprises approximately 20% of listed banks
• Net loan portfolio reached USD 100,578.9 million as of November 2025, reflecting 5.91% year-on-year growth

Unique Position Without a Central Bank:

Panama's lack of a traditional central bank means there is no independent monetary policy authority issuing currency or managing interest rates. The National Bank of Panama operates the payments system and manages a liquidity fund for banks facing shortages. However, the country lacks formal deposit insurance frameworks, lender-of-last-resort mechanisms, and emergency liquidity assistance systems—relying instead on the dollar's stability and the strength of participating international banks.

Banking System Composition

The banking sector consists of two primary segments:

1. Onshore Banks (General License): Conduct banking business within and outside Panama
2. Offshore Banks (International License): Exclusively conduct banking business with non-residents, prohibited from competing in the domestic Panamanian market

Basic Identity

Classification

Inclusion Justification

What This Entity Oversees

General Banking License

Applicability: Granted to banks dedicated to any and/or all forms of banking business in Panama and/or abroad.

Minimum Capital Requirement: USD 10 million

Operations: General licenses permit full engagement in domestic and international banking activities, subject to SBP regulatory oversight.

International Banking License

Applicability: Granted to banks that exclusively direct, from an office in Panama, transactions completed, consummated, or having effects abroad.

Minimum Capital Requirement: USD 3 million

Processing Timeline: Upon receipt of application, the SBP has a term of 120 days to decide whether to grant or deny the license.

Market Position: International banks represent approximately 20% of all licensed banks in Panama and are prohibited from competing in the domestic market or accepting deposits from Panamanian residents.

Representative Office License

Applicability: Available only to foreign banks with established headquarters and substantial operations in their home jurisdiction, subject to supervision by a foreign authority.

Requirements:

• Physical presence in Panama
• Parent bank constituted and operating abroad
• Management and substantial operations carried out in home country
• Home country must have proper banking supervision authority
• Certification from home country monetary or supervising authorities

Operational Restrictions: Representative offices cannot perform banking operations with either residents or non-residents. They are prohibited from:

• Operating passive or active banking operations
• Performing credit mediation
• Managing capital or assets in trust arrangements

Regulatory Requirement: Representation offices must include "Representative Office" designation in all operations and communications.

Licensing Procedure

Regulation No. 3-2001 issued by the SBP outlines specific requirements for requesting each license type. Applications require:

• Certification from home country authorities
• Proof of authorization to establish representation and conduct banking business
• Compliance with SBP's detailed application requirements
• Capital certification and ownership documentation

Trust Companies and Fiduciary Entities

The SBP exercises supervisory authority over trust companies and professional trustees licensed to conduct fiduciary activities in Panama.

Legislative Framework

Fiduciary activities are governed by:

• Panama Trust Law No. 1 of 1984 (foundational legislation)
• Law No. 21 of 2017 (modern requirements and licensing standards)

Licensing Requirements

Law No. 21 of 2017 introduces specific requirements for obtaining trust business licenses, including:

• Detailed licensing application procedures
• Qualification standards for trustees and administrators
• Beneficial ownership transparency requirements
• Trust business license cancellation causes and procedures

Licensed Entities

The SBP has licensed more than 80 local and international fiduciary companies to conduct professional trust activities. Licensed entities are subject to ongoing SBP supervision and compliance monitoring.

Authorized Trust Activities

Professional trustees may engage in activities explicitly authorized under the regulatory framework:

• Trust administration and management
• Foundation administration
• Estate planning services
• Asset management and protection arrangements
• Other fiduciary activities as specified in regulations

Money Remittance Regulation

Money remittance operators (MRO) activities are regulated under the SBP's supervisory authority and additional oversight by the Ministry of Commerce and Industries.

Legislative Framework

Regulation of MROs is established through:

• Law 48 of June 23, 2003
• Resolution 328 of August 9, 2004

As of 2017, the Banking Superintendent assumed oversight of AML/CFT compliance for money services businesses.

Regulatory Requirements and Client Identification

MROs must implement comprehensive client identification procedures requiring collection of:

• Full client name
• Personal identity card or passport
• RUC (tax identification number)
• Residential and commercial location
• Phone numbers and email addresses

Transaction Reporting Obligations

MROs must report:

• All transfers sent and received in cash exceeding B/.10,000.00 by the same client
• Successive transactions within the same working week collectively totaling B/.10,000.00 or more
• Suspicious transactions related to money laundering or terrorist financing

Enforcement and Penalties

The SBP enforces compliance through a progressive penalty structure:

• First Offense: Written warning
• Repetitive Offenses: Fines ranging from B/.1,000 to B/.50,000
• Third Offense: Cancellation of MRO license

As of the 2026 regulatory environment, there are 18 registered remittance companies operating in Panama under this framework.

Modern Payment Services

Electronic Money Institutions (EMI), Payment Institutions (PI), and Payment Service Providers (PSP) licenses remain under regulatory review. These modern payment services are neither expressly prohibited nor fully regulated under current 2026 frameworks, creating a developing regulatory landscape for fintech and digital payment providers.

FATF Compliance and Historical Context

Panama was included on the Financial Action Task Force (FATF) grey list from June 2019 until October 2023, following mutual evaluations identifying strategic deficiencies in the AML/CFT regime. However, Panama successfully exited the grey list in October 2023 after completing all items of its action plan, demonstrating substantial improvement in compliance with international standards.

Legislative Framework

Panama's AML/CFT legal framework comprises:

• Law 23 of April 27, 2015 (foundational AML/CFT law)
• Decree 363 of August 13, 2015 (implementing regulations)
• Law 70 of 2019 (strengthened regime updates)

These laws establish preventive measures applicable to financial and non-financial entities, addressing:

• Customer due diligence (CDD)
• Enhanced due diligence (EDD)
• Beneficial ownership transparency
• Sanctions screening

Key Focus Areas

Legal Persons and Arrangements: Panama historically faced scrutiny regarding misuse of legal entities for money laundering. Current frameworks emphasize:

• Beneficial ownership identification
• Transparency requirements for nominees and trust arrangements
• Enhanced scrutiny of complex structures

Banking Sector AML Integration: Panamanian banks align their AML practices with FATF recommendations and implement risk-based customer due diligence tailored to customer profiles and transaction types.

Regulatory Enforcement

Rule 1-2026 Enhancements: Updated on January 16, 2026, this rule provides the most current framework for AML/CFT/CPF prevention, establishing binding standards for:

• Risk assessment methodologies
• Transaction monitoring systems
• Suspicious activity reporting
• Staff training and awareness programs

Financial Analysis Unit (UAF)

The Unidad de Análisis Financiero (UAF) serves as Panama's primary authority for AML/CFT enforcement and oversight.

Functions

• Monitoring of suspicious transactions
• Enforcement of AML/CFT compliance across financial and non-financial sectors
• Coordination with law enforcement and international FIUs
• Analysis of financial flows related to illicit activities

Regulatory Integration

The UAF coordinates with the SBP and other financial sector regulators to ensure comprehensive coverage of banking institutions, money transmitters, trust companies, and other financial service providers.

Regulatory Powers

The SBP exercises comprehensive enforcement authority to ensure compliance with banking laws and regulations.

Licensing Suspension and Revocation

The SBP may:

• Suspend banking licenses for regulatory violations
• Revoke licenses following serious or repeated infractions
• Deny license applications based on applicant non-compliance with regulatory standards

Financial Penalties

The SBP may impose monetary penalties ranging from administrative fines to substantial assessments based on violation severity, recidivism, and systemic impact.

Mandatory Remediation

The SBP may require:

• Corrective action plans addressing identified deficiencies
• Enhanced supervision and reporting requirements
• Management changes addressing governance failures
• Board-level accountability measures

Examination and Inspection Authority

The SBP maintains comprehensive examination authority to:

• Conduct routine and targeted supervisory examinations
• Inspect banking facilities and records
• Request documents, data, and explanations from regulated entities
• Obtain information from officers and employees
• Engage external auditors for specialized examinations

Consumer Protection Measures

The SBP may implement consumer-protective measures including:

• Public warnings regarding unauthorized entities
• Restrictions on marketing and solicitation
• Requirements for disclosure of risks to depositors
• Mandated trust fund segregation and custody arrangements

Regulatory Role and Function

Legal Foundation

Primary Legislative Framework

The SBP exercises regulatory authority under Decree-Law 2 of February 22, 2008, which establishes the modern banking law framework. This decree was codified through Executive Decree N° 52 (April 30, 2008), adopting the Sole Text of Decree Law 9 of February 26, 1998, as modified by Decree Law 2.

Regulatory Powers and Responsibilities

The SBP's principal objective is to ensure the soundness and efficiency of the banking system through supervision of:

• Banks and banking groups authorized to operate in Panama
• Fiduciary entities (trust companies) to which the SBP has granted corresponding licenses
• Money remittance operators
• Exchange houses
• Other financial service providers as designated by law

Regulatory Instruments

The SBP issues binding regulatory rules and norms for banking sector compliance. Notable 2026 regulatory actions include:

Rule 1-2026 (January 16, 2026): The Board of Directors issued comprehensive updates to prevent misuse of banking and fiduciary services. This rule reinforces prevention, detection, and mitigation of risks associated with:

• Money laundering (ML)
• Terrorist financing (CFT)
• Proliferation financing (CPF)
• Other conduct compromising the integrity, stability, and reputation of banking and fiduciary services

The SBP has presented a 2026 budget of B/.29,850,000 to the Budget Committee of the National Assembly to continue ensuring stability, transparency, and soundness of the Panamanian banking system.

Licensing and Authorization Relevance

The Superintendencia de Bancos de Panamá (SBP) issues authorizations within its regulatory mandate in Panama:

[Specific license types and requirements require verification from official sources]

Payments and Money Movement Relevance

The Superintendencia de Bancos de Panamá (SBP) has the following relevance to payments and money movement in Panama:

Payment Systems Governed or Overseen

Panama lacks a traditional central bank; the National Bank of Panama (BNP) functions as the main settlement bank and operates the country's most important settlement system. The Superintendency of Banks (SBP) provides banking sector supervision and participates in payment system oversight. Key systems include:

Relationship to Other Regulators

The SBP participates in international regulatory frameworks and coordination mechanisms to enhance banking sector supervision and stability.

Regional Leadership

Milton Ayón Wong, as Vice President of the Central American Council of Superintendents of Banks, Insurance, and Other Financial Institutions (CCSBSO), coordinates regulatory approaches across the Central American region and facilitates information sharing on banking sector developments.

Multilateral Financial Coordination

Financial Coordination Council (CCF): Chaired by the Superintendent, this body coordinates regulatory approaches across Panama's financial sector, including banking, securities, and insurance regulators.

National Commission Against Money Laundering (CNBC): The Superintendent serves as a member of this inter-institutional body responsible for AML/CFT/CPF policy coordination and implementation.

International Standards Alignment

The SBP ensures Panama's banking regulations align with:

• Basel Committee on Banking Supervision standards
• Financial Action Task Force (FATF) recommendations
• International Monetary Fund assessments and technical guidance
• World Bank financial sector assessment recommendations

Geography and Jurisdiction Notes

Important Departments and Divisions

Key Public Resources

Official Website and Communications

Primary Website: https://www.superbancos.gob.pa/

English Language Portal: https://www.superbancos.gob.pa/en/

News and Updates: https://www.superbancos.gob.pa/en/noticias

Regulatory Resources

Banking Law Framework: https://www.superbancos.gob.pa/en/prev-cont-il-op/leg-fram/banking_law

Laws and Regulations: https://www.superbancos.gob.pa/en/laws/laws

Superintendent Information: https://www.superbancos.gob.pa/en/about-sbp/superintendent

Board of Directors: https://www.superbancos.gob.pa/en/about-sbp/directors

Related Institutions

National Bank of Panama (BNP): Operates payments system and manages banking system liquidity fund

National Commission Against Money Laundering (CNBC): Inter-institutional coordination body for AML/CFT/CPF policy; available at https://cnbc.mef.gob.pa/

Financial Coordination Council (CCF): Coordinates regulatory approaches across financial sector regulators

Notes on Naming and Language