The Business Year


PANAMA - Finance

Javier Enrique Carrizo Esquivel

CEO, Banco Nacional de Panamá


Javier Enrique Carrizo Esquivel studied business management at Babson College, Wellesley, Massachusetts and holds extensive experience in different banks. He was the general manager of PRIBANCO during its merger with Banistmo until 2003, executive vice president of Banco Uno in Costa Rica until 2005, the first vice president of Multibank until 2019, and is currently the General Manager of Panama National Bank and Director of Petroterminal and Cable & Wireless

"We envision the Panamanian banking system headed in the direction of digital banking, consolidation, AI, and sustainability."
TBY talks to Javier Enrique Carrizo Esquivel, CEO of Banco Nacional de Panamá, about the state of finance in the country, digitalisation, and the bank’s strategic roadmap
What is your view of the current state of the finance sector in Panama?

Panama has a well-developed, modern, and successful international banking center, with over 65 banks engaging in financial activities. The Superintendence of Banks of Panama oversees the financial sector. It is a supervisory body that closely monitors banks to ensure they are fully compliant with regulations. Banking legislation is compliant with the Basel Core Principles. The Panamanian banking system has remained resilient during economic cycles due to its strong capital base and high liquidity levels. We envision the Panamanian banking system headed in the direction of digital banking, consolidation, AI, and sustainability. In digital banking, the pandemic has accelerated the need to update contactless banking through electronic channels. This trend will continue with the introduction of innovative banking methods and new payment channels that facilitate financial transactions without having to physically go to a banking office. Additionally, digital financial methods will include segments of the population that are not being served or underserved. Banks’ consumer behavior is shifting toward fast, technology-based banking. Panama’s banking system will also continue with its consolidation process, as banking institutions focus on being more efficient. Banking models need to be adjusted, as more electronic banking will require less physical presence and therefore fewer branches. The use of AI tools to manage risks by analyzing large volumes of complex data, identify patterns, and predict outcomes will aide in effectively mitigating credit risks, market risk, liquidity risk, and detecting suspicious activities that indicate the possibilities of fraud or in appropriate use of banking services. Lastly, a more inclusive financial system is needed for long-term growth along with environmental, social, and governance (ESG) investing. Banks will need to focus on sustainable bonds, sustainability-related syndicated loans, sustainability-linked loans, and clean energy financing, among others. Banks must prepare themselves for the use of frameworks and or standards for sustainability-related financial products. Through environmentally friendly investing, the banking system will be able to contribute to mitigating climate change in Panama.

How is Banco Nacional reshaping its services in line with digitalization?

Banco Nacional has placed people at the center of our its digitalization efforts. We are redesigning our digital channels with “his majesty the customer” the customer majesty experience as the focal point, modernizing online and mobile banking so that our clients can access transactions and services conveniently from their mobile devices or computers. Internally, we have digitalized our processes to enhance the experience of our employees, resulting in faster and higher-quality responses to our customers. We have harnessed technology to transcend institutional boundaries by integrating with external entities for the benefit of our clients, as exemplified by the digital registration of mortgages. Data is seen as a significant source of opportunities to better understand customer needs, create, and offer services and products that cater to those needs. We are developing data analysis capabilities that enable data-driven decision making at all levels of the organization.

What strategies has the bank followed to reach a total capitalization of $1,000 million (USD350 million in this four-year period) representing an increase of 54%?

Since the beginning of this administration in June of 2019, our its interest has been to strengthen the bank’s capital and reaffirm its financial solidity. To achieve this, we have it has worked on renewing the dividend payment policy to the government, which was renewed indefinitely. This policy allows the delivery of up to 50% of the profits generated in the year, provided that the bank compliesfulfills with the required regulatory capital adequacy guidelines, internal policies, and accounting reserves, and complies with financial covenants. The remaining 50% of profits will be retained by the bank for capitalization. Taking this into consideration, a capitalization plan was established, starting with USDPAB100 million in 2020 followed by another USDPAB100 million in 2022 and an additional USDPAB150 million this year, reaching a total of USDPAB1,000 million in contributed capital. This represents a 54% increase in the bank’s contributed capital and places Banco Nacional as the leading Panamanian bank in terms of contributed capital.

How does Banco Nacional’s strategic roadmap support its vision?

The vision of Banco Nacional is to be the first state-owned bank focused on customer service, recognized for its trust and solidity, a leader in innovative, efficient, and high-quality financial solutions, strengthening the development of its employees and Panama. In pursuit of this vision, the bank has developed a strategic roadmap based on three pillars: customer satisfaction, our people, and continuous improvement. As a result, we established six main strategies: commercial strategy; customer experience; organizational and human development; operations, processes, and technology; quality and information security; and measurement, profitability, and finance. Under the commercial strategy, our objectives are to identify, develop initiatives, and capitalize on business opportunities to ensure the sustained and profitable growth of the institution, while for customer experience we aim to offer the best product and service alternatives to customers, exceeding their expectations with the highest standards. In terms of organizational and human development, we aim to foster a sense of belonging among employees and improve the work environment. For operations, processes, and technology, our objective is to implement effective processes and cutting-edge technology to guarantee the quality of customer service and increase productivity and the profitability of the institution. Then, as part of quality and information security, we want to equip the bank with knowledge about the data it handles, translating it into information that will be used to generate business opportunities and enhance profitability and customer service, and create a cybersecurity culture to identify security vulnerabilities and minimize the risk of incidents. Last, under measurement, profitability, and finance, we aim to establish a culture of continuous performance measurement to optimize the organization’s profitability. Some of Banco Nacional’s goals for 2023-2024 include providing financing to different economic sectors that boost national economic activity and contribute to improving social conditions for Panama and its peoplethe population and the country; increasing the loan portfolio by an annual rate of 6.7%, resulting in disbursements of USDPAB1,606 million for 2023 and USDPAB1,788 million for 2024; sustainably increasing profitability and maximizing resources to generate higher profits, strengthening the bank’s financial solidity through increased retained earnings and paid-up capital; and strengthening the organizational and academic structure of employees by implementing development and leadership programs to address the competitive challenges of the current banking sector. We also seek to improve the work environment for bank employees by considering job valuation and updating the salary scale and other benefits in line with the banking business, aiming to generate enthusiasm, motivation, and commitment to the institution. At the same time, we will continue to work on modernizing the bank’s technological platform to develop and implement new online and mobile banking functionalities, providing added value to customers. In addition, Banco Nacional will work on enhancing the customer experience with digital service platforms to expand the range of services, payments, and inquiries available through various digital channels as well as promoting and automating self-service options for bank customers, improving digital processes. Our goals also include implementing technological monitoring tools for the institution’s critical services of the institution, implementing 114 Security Policies in accordance with ISO 27001 quality standards, and developing continuous training programs plans on information security to minimize cybersecurity risks.



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