Economy, Currency and Banking
centesimos, paper currency, Grand Cayman, coinage, balboa
Panama’s financial sector has more than 100 banks, with combined assets of more than $30 billion. This sector arose after a 1970 law permitted secret bank accounts and advantageous tax terms. Over the years, the banks have been alleged to handle illegal cash operations, a practice called laundering, on behalf of narcotics organizations in South America. The United States has pressured Panama into tightening rules regulating bank accounts and transfers. Panama has not given full access, arguing that the money would simply be moved to other protected havens, such as The Bahamas and Grand Cayman.
Panama’s official monetary unit is the balboa, whose value is fixed at one U.S. dollar. Panama has no paper currency of its own; the only paper money is the dollar. Fractional coins, based on 100 centesimos per balboa, are almost identical in denomination to U.S. coinage.
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