New Regulations on Bank Mergers and Transfer of Shares

The Superintendence of Banks has adopted Resolution No.1-2004 of December 29, 2004, whereby certain requirements are set forth regarding the authorization that this regulator must issue to all to any merger and acquisition transactions or the transfer of shares of banks and economic groups.
Panama Finance and Banking
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This article was first published on the International Law Office website at www.internationallawoffice.com

The Superintendence of Banks has adopted Resolution No.1-2004 of December 29, 2004, whereby certain requirements are set forth regarding the authorization that this regulator must issue to all to any merger and acquisition transactions or the transfer of shares of banks and economic groups. Any change in the share ownership structure of a bank must also be previously approved by the Superintendence.

The Superintendence has determined that the merger or transfer in which there is "significant intervention", defined as the holding of at least 25% of the shares of the bank or economic group, must obtain the prior approval of the Superintendence of Banks.

The interested party in the merger or transfer of shares transaction must file a petition before the Superintendence and attach several documents listed in the resolution. For regulated entities, the Superintendence has a term of 30 calendar days to review it and issue its decision to approve it or not. For non-regulated entities, the term is 60 calendar days.

In regards to mergers of banks that are accomplished outside of Panama which affect branches or subsidiaries of banks licensed in Panama, prior approval of the Superintendence is also required. As for mergers within the same economic group, which do not involve banks or its holding companies, only a notice to the Superintendence will be applicable.

For additional information, please contact Ivette E. Martínez S.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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