Fitch Ratings, "Reputational risk events could put broad pressure on funding access and damage Panama's position as a regional financial center. "
From a report by Fitch Ratings:
Fitch Ratings-San Salvador/New York-15 March 2017: Reputational and conduct risk will remain key issues for Panamanian banks in 2017 owing to the interconnectedness of the regional financial system and ongoing high profile corruption cases that have affected multiple countries in Latin America, says Fitch Ratings. Reputational risk events could put broad pressure on funding access and damage Panama's position as a regional financial center.
Amendments to the law on the financial system include changes to the conditions which must be present in order for an order to be issued for the forced liquidation of an institution.
From a statement issued by the National Congress:
The National Congress approved on Thursday, in the third and final debate, several articles of the decree containing the amendments to the Law on Financial Institutions, which aims to bring legislation into line with international standards and prevent banks from having problems which could lead to a forced liquidation, as recently happened with Continental Bank, through an early and timely action by the supervisory body, preventing savers or account holders from being affected.
Unions are opposed to the legal reform which aims to extend the scope of the supervision of the Superintendent of Financial System over savings and loans cooperatives.
In the view of Julio Cesar Portillo, secretary of the board of the National Commission for credit unions in El Salvador and CEO of Co-Andes de R.L. ,"... the reform presented to the Legislature, seeks to impose on savings and loans cooperatives a framework of regulation and supervision which is exclusively for private financial companies and for-profit institutions such as banks. "
A bill being promoted by the executive branch seeks to authorize the Bank of Guatemala to finance the capitalization of a bank when it faces problems affecting financial stability.
The aim of this initiative is to adapt the rules on financial supervision and risk control to international standards, to prevent the stability of the domestic financial system from being affected when a bank has liquidity or solvency problems.
A rule has entered into force which requires free zone, construction, real estate and other companies to adopt a warning signs guide to prevent illegal money laundering activities.
Among the companies that will be supervised by the Administration of Supervision and Regulation of Non-Financial Subjects are: free zone companies, money remittance companies, real estate developers, pawn shops, security transport companies, sellers of vehicles for construction market.
The Superintendent of the Financial System has started monitoring the operations of companies that send and receive remittances.
With the law reform passed by the Assembly, legal persons performing operations to systematically send or receive money or substantial amounts, by any means, at national and international level, will be supervised by the Superintendency of the Financial System. The Central Reserve Bank of El Salvador will be responsible for issuing the relevant technical regulations.
Construction companies, car sales companies and free zone companies are part of the list of entities whose activity will be controlled by the new Administration of Supervision and Regulation of Non-Financial Subjects.
The creation of the Administration for Supervision and Regulation of Non Financial Subjects is one of the requirements which the country must comply with as part of the process to get off the gray list of the Financial Action Task Force (FATF). The new regulator, led by Francisco Bustamante, also oversee the activities of "... pawn shops, casinos, exchange offices, corporations, savings and home loan societies, the National Lottery, companies engaged in marketing metals and precious stones, and security transport companies, among others. "
The 16 non-financial economic sectors included in the new law against money laundering will be supervised by a new Administration, which will operate independently of the Financial Regulator.
It has been announced that the new Administration of Supervision and Regulation will be attached to the Ministry of Economy and Finance, from where the person who will lead the new institution will be appointed. This regulating body will supervise non-financial economic sectors such as construction, real estate, trade, free zones, among others.
The microcredit portfolio in Latin America and the Caribbean is worth over $40 billion, is awarded by more than 1,000 institutions, and reaches more than 22 million customers.
From a statement issued by the Inter-American Development Bank (IDB):
A new report documents significant expansion of microcredit in Latin America and the Caribbean
GUAYAQUIL, Ecuador - Microcredit in Latin America and the Caribbean remains strong and continues its expansion of the last decade, experiencing an increase in their number of customers, a variety of institutions and a downward trend in interest rates according to new data released here today by the Multilateral Investment Fund (MIF), a member of the IDB Group.
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