What Happened
Panama’s Ministry of Economy and Finance announced a financing deal with Citibank, N.A. for up to 1,975 million Swiss francs, equal to about $2.519 billion. The agreement carries a fixed annual rate of 2.39% and a three-year term, with maturity set for March 2029.
Officials say the structure is expected to produce a 1.66% saving in interest costs compared with other financing options currently available in the U.S. dollar market. The move gives the government a new borrowing source outside the dollar-denominated instruments it typically uses.
Why the Government Chose Swiss Francs
The Ministry of Economy and Finance said the operation is designed to diversify funding sources and lower the sovereign’s borrowing costs. By borrowing in Swiss francs, Panama taps into a currency and rate environment that can be more favorable than dollar financing at a given moment.
That approach also reduces reliance on a single currency for public debt. For a country with a large debt load, spreading exposure across different financing structures can help manage costs and improve flexibility when markets shift.
How the Money Will Be Used
The proceeds will serve two main purposes. First, they will refinance the Treasury Note known as PANOTA 3.75%, which matures on April 17, 2026 and totals $1.325 billion. Second, the funds will cover operating needs in the 2026 General State Budget.
The government said the fixed rate provides predictability in cash flows over the next three years and helps shield public finances from possible increases in global interest rates. A set cost can make budget planning easier when refinancing older debt or meeting current fiscal obligations.
Debt Context
Panama’s total public debt stood at $60.059 billion at the end of February 2026. Against that backdrop, the new financing is part of a broader effort to manage obligations carefully while balancing refinancing needs and day-to-day budget pressures.
The Ministry described the operation as part of a prudent and responsible debt management strategy. For Panama, access to alternative financing structures can be important as the government works to contain borrowing costs and maintain liquidity.