IDB Lends $500M To
Support Panama's Banking Industry
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IDB
Lends $500M To Support Panama's Banking
Industry
DOW JONES NEWSWIRES - The Inter-American
Development Bank, or IDB, Thursday said it
approved a $500 million loan to strengthen
the liquidity of Panama's banking system.
The loan will be channeled through Banco
Nacional de Panama, a state-owned
institution that also acts as a commercial
and development bank, the Washington-based
multilateral lender said in a press release.
"The funds are expected to partially offset
a shortfall in dollar-denominated lending to
the productive sector triggered by the
current global financial crisis," the IDB
said.
Banco Nacional de Panama will act as an
intermediary to provide working capital and
foreign-trade financing to the industrial
sector, the IDB added.
The loan, which expires in five years and
has a three-year grace period, will pay a
spread of 4 percentage points over the
6-month London interbank offered rate.
The loan is part of a $6 billion program
recently created by the IDB to help
governments respond to the needs of
commercial banks that may face difficulties
in accessing foreign and inter-bank credit
lines due to the global credit crunch.
The IDB noted that Panama has a solid
economy that grew at an average 8.8% between
2004 and 2008, far outpacing the 5.5%
regional average.
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