Fitch Ratings affirms Banconal’s risk ratings

Reviewer Fitch Ratings confirmed the international risk assessment National Bank of Panama to Long term in “BBB-“with stable prospects.

He also confirmed the local rating Long-term in “AAA (bread)”with stable prospects.

Qualifications of banconal they are encouraged by the high probability of support they will receive from the Republic of Panama (BBB-stable forecast), if needed. Fitch’s support rating is influenced by the government’s collateral guarantee for all the Bank’s obligations.

The role of the bank as the financial arm of the state is of great importance in the assessment fitch and is an important factor in the government’s efforts to provide support.

According to Fitch, the bank’s history shows that it fulfills an unofficial role as a lender of last resort in Panama.

Banconal is the bank and administrator of the Panamanian government and all public entities Real time gross settlement system of the Panamanian banking system.

According to Fitch, these roles are permanent and difficult to transfer to other government agencies.

Fitch considers Banconal to be well capitalized with a normal level capital ratio 1 (CET1) of 17.5% until December 2022.

Equity indices benefited from a higher proportion of liquid assets, with lower risk density and high levels of profitability.

“We are constantly working on maintenance National Bank with optimal capitalization levels, showing the strength and stability of the bank of all Panamanians; promoting the economic growth of Panama”, said Mr. Javier Carrizo, General Manager of Banconal.

The bank has a high ability to generate profit, with a ratio of operational profitability to risk-weighted assets of 3.2% at the end of 2022, a favorable recovery compared to the period 2020-2021.

The exchange rate change during 2022 resulted from the recovery of margins, lower costs and the growth of the loan portfolio. The bank is in a favorable position to maintain or even exceed the profitability rates from the end of 2022 during 2023, given the expected levels of asset quality and a certain improvement in the financial margin in relation to the upward trend of the local interest rate.