Panama - Financial Sector Assessment Program Technical Note - Climate-Related and Environmental Risks and Opportunities (CERO)

Jul 19, 2026

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Technical Note developed within the IMF-World Bank Financial Sector Assessment Program mission in Panama (June 2023) to support FSAP findings and recommendations on climate-related and environmental risks. It analyzes physical and transition vulnerabilities, reviews government initiatives for mitigation, adaptation, and nature protection, and assesses how supervisors respond through governance, awareness, risk identification, guidance, and supervisory tools. It also examines approaches to deepen green finance markets and disaster risk finance, including barriers, data, instruments, and insurance penetration.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages60

Reading Time2 h 31 min

Executive Summary

Climate and environmental risk analysis

Supervisory response to climate and environmental risks

Developing and deepening green finance markets

Disaster Risk Finance

I. Introduction

II. Climate Change and Macro-Financial Context

III. Climate-Related and Environmental Risks and the Financial Sector

IV. Assessment of the Supervisory Response to Address Climate-related and Environmental Risks

V. Deepening Green Finance Markets

VI. Assessment of the Supervisory Response to Deepen Green Finance Markets in Panama

VII. Disaster risk finance in Panama

November 2023 Public Disc losure Authorized THE WORLD BANK GROUP PANAMA FINANCIAL SECTOR ASSESSMENT PROGRAM TECHNICAL NOTE CLIMATE-RELATED AND ENVIRONMENTAL RISKS AND OPPORTUNITIES (CERO) Pub lic Disc losure Authorized Prepared By Finance, Competitiveness, and Innovation Global Practice, WBG This Technical Note was prepared in the context of a joint IMF-World Bank Financial Sector Assessment Program (FSAP) mission in Panama during June 2023 led by Richard Stobo, IMF and Emile van der Does de Willebois, World Bank, and overseen by the Monetary and Capital Markets Department. IMF, and the Finance, Competitiveness, and Innovation Global Practice, World Bank Group. The note contains the technical analysis and detailed information underpinning the FSAP assessment’s findings and recommendations. Further information on the FSAP program can be found [at ](at www.worldbank.org/fsap)[www.worldbank.org/fsap](at www.worldbank.org/fsap). CONTENTS Executive Summary...................................................................................................................................................................3 Climate and environmental risk analysis.....................................................................................................................3 Supervisory response to climate and environmental risks ..................................................................................4 Developing and deepening green finance markets ...............................................................................................5 Disaster Risk Finance ..........................................................................................................................................................6 I. Introduction .............................................................................................................................................................................8 II. Climate Change and Macro-Financial Context .........................................................................................................9 Vulnerabilities to climate physical risks .......................................................................................................................9 Vulnerabilities to climate transition risks ................................................................................................................. 12 Government Initiatives for Climate Mitigation, Adaptation and Nature Protection ............................... 16 III. Climate-Related and Environmental Risks and the Financial Sector ............................................................ 18 Climate and Environmental Physical Risks .............................................................................................................. 19 Climate and Environmental Transition Risks .......................................................................................................... 26 IV. Assessment of the Supervisory Response to Address Climate-related and Environmental Risks.... 30 Governance and Strategy .............................................................................................................................................. 30 Raising awareness and capacity building ................................................................................................................ 30 Risk identification, assessment and monitoring.................................................................................................... 31 Supervisory guidance ...................................................................................................................................................... 33 Supervisory actions and tools ...................................................................................................................................... 34 V. Deepening Green Finance Markets .......

FAQs

What is the purpose of this Technical Note in Panama’s FSAP process?

It provides technical analysis and detailed information that underpin the FSAP assessment findings and recommendations on climate-related and environmental risks and opportunities.

Which types of climate risks are analyzed in the document?

The note addresses climate physical risks and climate transition risks, identifying vulnerabilities and their implications for the financial sector.

How does the document approach improving green finance and disaster risk finance?

It evaluates how to deepen green finance markets through market objectives, instruments, barriers, transparency, data availability, and supervisory responses, and it reviews Panama’s disaster risk financing and insurance approach, including market penetration and insurance capacity.

Jul 19, 2026

Upload by Patrick