Moderators Moderator_02 Posted March 16, 2017 Moderators Share Posted March 16, 2017 Quote Corruption scandals earn Fitch negative bank report Posted on March 16, 2017 in Panama, Panama Post Views: 32 ODEBRECHT and ongoing corruption scandals have produced a negative outlook for Panamanian banks from Fitch Ratings. Fitch issued a report on Wednesday, March 15 warning that a reputational risk remains as a key concern for Panama’s banks, and also expects to accelerate the deterioration of the quality of assets. The reputational risk that it observes in Panamanian banks are linked to the corruption scandals of Brazilian firms Odebrecht and Petrobras in 2017, which have focused attention on corporate corruption in Latin America. In the case of Odebrecht’s corruption, Switzerland’s federal prosecutors formally charged the two sons of former president Ricardo Martinelli Berrocal – Luis Enrique and Ricardo Alberto Martinelli Linares of bribery of foreign officials and of money laundering, and seized $22 million in bank accounts. According to evidence obtained from bank transactions, prosecutors suspect that the money was paid on orders from Odebrecht in bribes for infrastructure works awarded to the company by the State In the case of the oil company Petrobras, Fitch reports that a Panama bank has been involved: “After the accusations in 2016 by the Brazilian authorities, that It received funds from the corruption of contractors and directors of Petrobras, FPB Bank was under the administrative control of the Panamanian regulator” Brazilian prosecutors have detected alleged assets in which a company incorporated in Panama, Constructora Internacional del Sur was a recipient of more than $47 million, into an account at Credicorp Bank. The financial architecture designed to avoid the tracking of money had as its primary source funds from Petrobras, to then go through companies controlled by Odebrecht. The rating agency indicated that banks directly involved in recent corruption and money laundering have resulted in small franchises, without significant participation in local market deposits. “This has allowed a relatively efficient damage control by the regulator. A potential risk event in a medium or large bank would possibly have systemic implications” although Fitch believes that this is less likely to happen, as large banks often have corporate governance controls http://www.newsroompanama.com/business/panama-4/corruption-scandals-earn-fitch-negative-bank-report Quote Link to comment Share on other sites More sharing options...
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