Regulatory Alerts2020-03-18
Agreement No. 2 (2020) Establishing Additional, Exceptional, and Temporary Measures for Compliance with Credit Risk Provisions
The Superintendency of Banks of Panama issued Agreement No. 002-2020 to implement temporary, exceptional measures addressing the financial impact of the COVID-19 pandemic on the banking sector. The regulation introduces a new category of "modified loans" that allows banks to adjust credit terms without triggering standard restructuring classifications, while prohibiting the charging of fees for such modifications. Additionally, the agreement permits banks to utilize up to 80% of their dynamic provisions for specific provisions and suspends certain contagion rules to support economic stability.
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