In Costa Rica, GDP growth forecasts have risen to 3.9% this year, up on last year’s growth of 3.7%, while the second quarter of 2016 saw GDP expand 4.1% over the same period in 2015, according to FocusEconomics. 

Panama remains the darling of Central America, with its economy growing 5.2% year-on-year in the three months to June 2016, compared to 4.6% in the previous quarter. Its economy is projected to grow 6% this year, mainly due to expansion of the Panama Canal. 

“Central America as a region has benefited in recent months from low interest rates and low commodity prices,” says Federico Odio González, general manager of BAC San José. “If these tailwinds change, we still have some structural fiscal deficiencies that may affect growth in the region.” 

This year’s Bank of the Year Costa Rica and Bank of the Year Panama has leveraged the strengths of Central America’s two most robust economies, growing its loan portfolios and increasing the level of deposits in the last 12 months.

Banco BAC San José in Costa Rica recorded total income of 159.34 billion colones ($288.56 million) at the end of 2015, up from 149.81 billion colones recorded in 2014. That came as the Costa Rican lender’s loan portfolio amplified, reaching 140.1 billion colones at the end of last year, an increase of over 20 billion colones on 2014. 

The bank turned to the syndicated loan market to fund some of its new lending, raising $85 million from a three-year deal. “We were able to get this funding with exclusively new counterparties which is good, especially due to the participation of Asian and Latin American banks that we did not have as clients before,” says Odio. 

BAC Panamá, meanwhile, has also grown its loan portfolio and increased its deposits over the last year, outperforming its closest competitor Banco General. Loans reached $12.87 billion at the end of 2015, up from the 2014 figure of $11.36 billion, while total deposits hit $12.29 billion in 2015, compared to $11.37 billion at the end of 2014. 

A key source of BAC’s growth has come from its consumer banking brand Credomatic. With the support of its Colombian parent Banco de Bogotá, the regional bank has established a footprint in each Central American country except Belize. Such integration has enabled Credomatic’s customers to create accounts in multiple Central American jurisdictions and use electronic banking and credit card services almost anywhere in the region. 

Inorganic growth is also a possibility, adds Odio. “Our growth plan is organic, but if there is a good acquisition opportunity that makes sense we will be willing to explore it.”

Armed with a diverse portfolio of retail and corporate clients, this truly regional bank, a multiple-award winning lender with LatinFinance, is well-positioned financially and geographically to capitalize on Central America’s immediate economic growth. LF

WINNER: Banco BAC Credomatic