US$2.3 trillion to be transferred from Panama to China via Panama-based bank

The US has pledged to transfer $2.1 trillion to Panama to avoid a banking crisis, and US$1.9 trillion to a Chinese bank that controls Panama’s financial sector, to help ease pressure on the nation, according to a report. 

The Panamanian National Bank and Panama’s Central Bank have agreed to transfer the funds in two phases, with the first expected to be completed in 2020, according the report from the Committee to Protect Journalists.

The US and Panama agreed to step up cooperation in response to the financial crisis in 2010, and have signed a $100 billion aid package to ease the banking crisis.

The Panamax and Panama-owned Panaman International Bank were initially sanctioned by the US in November 2015 after US Treasury Secretary Steven Mnuchin said the bank could become the “primary conduit” for money laundering for drug cartels.