Snapshot: Banesco Panama

The Panamanian unit of Venezuela’s Banesco may only be a mid-sized player in the Central American nation’s international banking center - but it is punching above its weight in terms of adoption of blockchain technology.

According to a statement, the lender has become the first in the region to successfully execute – as part of a test phase - an international transfer using California-based cryptocurrency firm Ripple’s blockchain-powered payments solution.

Banesco has not yet said when the service will be officially introduced for clients. “We will soon be announcing the availability of this innovative service in Panama,” Banesco said.

Last year Spanish bank Santander launched a Ripple-powered international payments solution called One Pay FX. Among the initial payments corridors was Brazil-UK. Santander has invested in Ripple via venture capital fund Santander InnoVentures.

The previous year Mexico's largest bank BBVA Bancomer and Spanish parent BBVA teamed up with Ripple to pilot an international transfer solution utilizing blockchain to send funds between Spain and Mexico.

Globally, blockchain is gaining traction in the payments market, as it helps facilitate fast, secure and low-cost money-moving services. Blockchain was originally used to support cryptocurrency but is now also being leveraged for a wide variety of real-world applications.

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Eric van Miltenburg, SVP of global operations at Ripple, has said blockchain-based remittances services can reduce associated costs incurred by banks by up to 60%. He said this makes low-value, high-volume transactions more attractive for banks but that whether banks choose to pass on these cost savings to the consumer was "their decision."

Regional fintechs are also leveraging blockchain to offer money-moving solutions, among them Argentina’s Bitex, which recently expanded into Chile. The company has Chile's export sector - and especially the SMEs that operate within it - in its crosshairs. Bitex is also looking to partner with local banks.

BANESCO PANAMA

Launched in 2007, Banesco Panama has 23 branches and 27 ATMs, according to data from banking watchdog SBP.

Assets, loans

At the end of December, it held assets of US$4.21bn, up 1.05% from a year earlier. The bank’s loan portfolio, meanwhile, contracted 1.27% to US$2.79bn.

Ranking

Of the 72 banks registered as operating in Panama’s international banking center at the end of December, Banesco was ranked 10 by loan portfolio. The biggest player, Banco de Bogotá unit BAC International, reported US$15.7bn.

In terms of profits, Banesco was ranked 11, reporting US$31mn for 2018, compared with No. 1 player BAC’s US$405mn.

Panama is among Latin America’s wealthiest countries, although economic growth recently lost steam amid a general slowdown in key sectors including construction. The IMF forecasts the economy will regain lost ground, which should support loan growth. 

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