business

Also in this section:
Banco Continental and Banco General merge
"Latin America's tallest building" project collapses
Government withholds text of Free Trade Agreement
The Panama News readership figures
Business & Economy Briefs

Banco General and Banco Continental merge

by Eric Jackson, mostly from other media

Once BANISTMO was sold to HSBC, the largest Panamanian bank left standing was Banco General, followed by the Motta family's Banco Continental in second place. But in these days of international bank consolidation, those two institutions felt that they were too small to survive the competition, even if their political connections had given them a large degree of access to social security and public employee pension funds.

Thus the two companies have signed an agreement for a stock swap merger, in which a new company will be created under the name of Banco General, with Banco Continental shareholders getting 39 percent of the stock and Banco General owners 61 percent.

The result will be a bank with about $7 billion in deposits, $800 million in assets, 300,000 depositors and 60 branches. Looked at another way, via interlocking directorates and family interests in common, it's a merger of several of Panama's richest families and biggest companies.

In the latter way of viewing it the merger may have some political implications --- for example, the people who run the TVN television networks and La Prensa will now be "related" by this business marriage. Both of those media empires have slanted their news coverage in favor of the PRD in recent years.