Panama’s International Banking Center concluded 2025 with robust growth in deposits and credit, according to official year-end data released this week. The Superintendency of Banks of Panama presented the financial results on Wednesday, February 25, 2026, highlighting a system that continues to expand despite global economic headwinds.
Total deposits within the banking system reached $116.81 billion by December 2025. This figure represents a significant increase of 5.72 percent, or an additional $6.32 billion, compared to the previous year. The credit portfolio, a key indicator of economic activity, grew by a solid 5 percent, aligning closely with the nation’s overall Gross Domestic Product (GDP) performance.
“The numbers show a resilient and growing financial center,” said Javier Motta of the Superintendency of Banks during the presentation. [Translated from Spanish] “Credit growth is in step with our economic activity, and deposits reflect sustained confidence, particularly from international clients.”
The growth trajectory sets a positive tone for the financial sector as it moves into the new year. Banking profits for 2025 totaled $3 billion, marking a 2 percent increase, though officials noted this rate of growth has moderated from previous years.
International Deposits Drive Overall Growth
A deeper analysis of the deposit figures reveals a crucial trend. The primary engine for the 5.72 percent overall increase was a surge in foreign deposits. These external funds grew by an impressive 11 percent year-over-year, jumping from $41.93 billion to $46.57 billion. Domestic deposits from Panamanian citizens, local companies, and the government also grew, but at a more modest pace of 2.46 percent.
This pattern is not new. Over the past five years, international deposit growth has averaged 9 percent annually, starkly outpacing the 4 percent average growth seen in the domestic market. The sustained inflow of foreign capital underscores Panama’s enduring role as a regional International Banking Center.
Motta emphasized this dynamic, noting that while local deposits still hold a larger share of the total, the external segment is the clear driver of expansion. This influence extends beyond deposits into other areas of the banks’ balance sheets.
Shifting Geographies of Foreign Funds
The origin of these international deposits shows interesting shifts. Colombia remains the undisputed leader, accounting for 22 percent of the foreign deposit market. Political and economic conditions within Colombia have contributed to a steady increase in the balances held by Colombian clients in Panamanian banks.
Costa Rica provided a surprise by climbing to the second position, a spot it does not typically hold. Officials clarified this rise was due to a specific, large-scale corporate financing deal that used a fixed-term deposit as collateral, temporarily boosting the country’s numbers.
The historical ranking is typically rounded out by nations like the Dominican Republic, Ecuador, Peru, and Venezuela. Venezuela itself remains a significant source, with a deposit portfolio totaling approximately $3 billion. There had been concerns that Venezuelan deposits might exhibit volatility similar to past episodes seen with Peruvian funds during political tensions. The data shows, however, that Venezuelan deposits remained stable throughout 2025 without any abrupt movements.
Credit Expansion and Consumer Debt Trends
On the lending side, the net credit portfolio hit $100 billion. That is a $4.8 billion increase from 2024. Mirroring the deposit trend, the current growth is fueled by the external credit portfolio, which is expanding at double-digit rates. The domestic loan book grew by just 1 percent in December.
Within the local portfolio, specific consumer loan categories told different stories. New mortgage disbursements actually decreased by 1 percent. Analysts suggest ongoing legal uncertainty surrounding the country’s preferential interest law may have contributed to this hesitation. Auto loans, in contrast, were the top performers. Their outstanding balances grew by 11.5 percent, and new auto credit increased by 14.8 percent.
“The quality of the auto loan portfolio is remarkably good,” Motta observed with some amazement. [Translated from Spanish] “It seems people will stop paying their mortgage before they default on their car loan.”
The data on consumer over-indebtedness offered a reassuring note. Panamanians, on average, dedicate 40 percent of their monthly income to debt payments. This level remains within the internationally accepted parameter of up to 45 percent, indicating a manageable overall debt burden for households.
Profits Concentrated Among Largest Banks
The banking system’s total net assets expanded by 4.23 percent over the year, reaching $163 billion. This growth points to a strategic focus on strengthening productive assets like loans and investments. It occurs within a regional environment characterized by high competition for liquidity.
The sector’s $3 billion in profits, while a record figure, revealed a slowing pace of earnings generation. The 2 percent growth in profits for 2025 is notably lower than the 8 percent increase recorded the previous year. Perhaps more telling is the high concentration of these earnings.
A small group of just 16 banks, those with assets exceeding $3 billion each, generated a staggering 86 percent of the system’s total profits. The remaining 35-plus banking entities in Panama shared only 14 percent of the earnings. This concentration highlights the competitive divide between the largest international players and smaller banks within the center.
For Panama, the year-end results paint a picture of a mature and stable financial hub. The system continues to attract foreign capital while providing the credit needed for domestic economic activity. The challenge ahead lies in broadening the base of profit generation and sustaining growth as global financial conditions evolve.