Under the Old Banking Law, banks could not grant loans or issue guarantees or any other obligation (“Credit Facilities”) to any one person or group of related persons in excess of twenty-five percent (25%) of the Bank’s total capital. The Banking Law has maintained this limitation with respect to banks, and also extended this limitation to Credit Facilities granted to parties related to the ultimate parent of the banking group. However, the Old Banking Law and the Banking Law establish that in the case of Credit Facilities granted by mixed-capital banks with headquarters in Panama whose principal business is the granting of loans to other banks, the limit will be thirty percent (30%) of the bank’s capital funds. As confirmed by the Superintendency of Banks, the Bank currently applies the limit of thirty percent (30%) of the Bank’s total capital with respect to the Bank’s credit facilities in favor of financial institutions and the limit of twenty-five percent (25%) of the Bank’s total capital with respect to the Bank’s credit facilities in favor of corporations and sovereign borrowers.

Under the Banking Law, a bank and the ultimate parent of the banking group may not grant loans or issue guarantees or any other obligation to “related parties” that exceed (1) 5% of its total capital, in the case of unsecured transactions, and (2) 10% of its total capital, in the case of collateralized transactions (other than loans secured by deposits in the bank). For these purposes, a “related party” is (a) any one or more of the bank’s directors, (b) any stockholder of the bank who directly or indirectly owns 5% or more of the issued and outstanding capital stock of the bank, (c) any company of which one or more of the bank’s directors is a director or officer or where one or more of the bank’s directors is a guarantor of the loan or credit facility, (d) any company or entity in which the bank or any one of its directors or officers can exercise a controlling influence, (e) any company or entity in which the bank or any one of its directors or officers owns 20% or more of the issue and outstanding capital stock of the company or entity and (f) managers, officers and employees of the bank, or their respective spouses (other than home mortgage loans or guaranteed personal loans under general programs approved by the bank for employees). The Superintendency of Banks currently limits the total amount of secured and unsecured Credit Facilities (other than Credit Facilities secured by deposits in the bank) granted by a bank or the ultimate parent of a banking group to related parties to 25% of the total capital of the bank.

The Superintendency of Banks may authorize the total or partial exclusion of loans or credits from the computation of these limitations in cases of unsecured loans and other credits granted by mixed-capital banks with headquarters in Panama whose principal business is the granting of loans to other banks, which is the case of the Bank. This authorization is ~~contingent on~~subject to the following conditions: (i) the ownership of shares in the debtor ~~bank –directly~~bank–directly or indirectly–by the shared director or shared officer, may not exceed five percent (5%) of the ~~bank's~~bank’s capital, or may not amount to any sum that would ensure his or her majority control over the decisions of the bank; (ii) the ownership of shares in the creditor bank–directly or indirectly–by the debtor bank represented in any manner by the shared director or shared officer, may not exceed five percent (5%) of the shares outstanding of the creditor bank, or may not amount to any sum that would ensure his or her majority control over the decisions of the bank; (iii) the shared director or shared officer must abstain from participating in the deliberations and in the voting sessions held by the creditor bank regarding the loan or credit request; and (iv) the loan or credit must strictly comply with customary standards of discretion set by the grantor ~~bank's~~bank’s credit policy. The Superintendency of Banks will determine the amount of the exclusion in the case of each loan or credit submitted for its consideration.

The Banking Law contains additional limitations and restrictions with respect to related party loans and credit facilities. For instance, under the Banking Law, banks may not grant Credit Facilities to any employee in an amount that exceeds the employee’s annual compensation package, and all Credit Facilities to managers, officers, employees or stockholders who are owners of 5% or more of the issued and outstanding capital stock of the lending bank or the ultimate parent of the banking group, will be made on terms and conditions similar to those given by the bank to its clients in arm’s-length transactions and which reflect market conditions for a similar type of operation. Shares of a bank cannot be pledged or offered as security for loans or ~~credit facilities~~Credit Facilities issued by the bank.

In addition to the foregoing requirements, there are certain other restrictions applicable to General License Banks, including (1) a requirement that a bank must notify the Superintendency of Banks before opening or closing a branch or office in Panama and obtain approval from the Superintendency of Banks before opening or closing a branch or subsidiary outside Panama, (2) a requirement that a bank obtain approval from the Superintendency of Banks before it liquidates its operations, merges or consolidates with another bank or sells all or substantially all of its assets, (3) a requirement that a bank must notify the Superintendency of Banks, within the first three months of each fiscal term, the name of the certified public accounting firm that it wishes to contract to carry out the duty of external auditing for the new fiscal term, and (4) a requirement that a bank obtain prior approval from the Superintendency of Banks of the risk rating entity it wishes to hire to perform the risk rating. The subsidiaries of Panamanian banks established in foreign jurisdictions must observe the legal and regulatory provisions applicable in Panama regarding the sufficiency of capital, as prescribed under the Banking Law.

2024

The Banking Law regulates banks and now the entire “banking group” to which each bank belongs. Banking groups are defined as the holding company and all direct and indirect subsidiaries of the holding company, including the bank in question. Banking groups must comply with audit standards and various limitations set forth in the Banking Law, in addition to all compliance required of the bank in question. The Banking Law provides that banks, and now banking groups, in Panama are subject to inspection by the Superintendency of Banks, which must take place at least once every two years. The Superintendency of Banks is empowered to request from any bank or any company that belongs to the economic group of which a bank in Panama is a member, the documents and reports pertaining to its operations and activities. Banks are required to file with the Superintendency of Banks monthly, quarterly and annual information, including financial statements, an analysis of their credit facilities and any other information requested by the Superintendency of Banks. In addition, banks are required to make available for inspection any reports or documents that are necessary for the Superintendency of Banks to ensure compliance with Panamanian banking laws and regulations. Banks subject to supervision may be fined by the Superintendency of Banks for violations of Panamanian banking laws and regulations. The Superintendency of Banks last inspected the Bank ~~during March of 2008,~~in February 2010, and the results of this inspection were fully satisfactory.

Panamanian Anti-Money Laundering laws and regulations.

In Panama, all banks and trust corporations must take necessary measures to prevent their operations and/or transactions from being used to commit the felony of money laundering, terrorism financing or any other illicit activity contemplated in the laws and regulations addressing this matter.

United States Law

Bladex operates a New York state-licensed agency in New York, New York and maintains a direct wholly-owned non-banking subsidiary in Delaware, Bladex Holdings Inc. (“Bladex Holdings”), ~~that~~which is not engaged in activities other than owning one wholly owned subsidiary incorporated under the laws of the State of Delaware: Bladex Asset Management ~~Inc.~~ incorporated on May 24, 2006. In February 2007, another wholly-owned subsidiary Clavex LLC,which was incorporated on June 15, 2006, became non-operative. On October 30, 2006, the Bank established an international administrative office in Miami, Florida (the “Florida International Administrative Office”). On April 16, 2008, Bladex incorporated a direct fifty percent (50%) owned subsidiary in Delaware with the name of BCG PA ~~Llc.,~~LLC, which is used as an investment vehicle to receive the performance allocation of Bladex Capital Growth Fund.

~~New York State Law~~. The New York Agency, established in 1989, is licensed by the Superintendent of Banks of the State of New York (the “Superintendent”) under the New York Banking Law. The New York Agency maintains an international banking facility that also is regulated by the Superintendent and the U.S. Federal Reserve Board. The New York Agency is examined by the New York State Banking Department and is subject to banking laws and regulations applicable to a foreign bank that operates a New York agency. New York agencies of foreign banks are regulated substantially the same as, and have similar powers to, New York state-chartered banks, except with respect to capital requirements and deposit-taking activities.

The Superintendent is empowered by law to require any branch or agency of a foreign bank to maintain in New York specified assets equal to a percentage of the branch’s or agency’s liabilities, as the Superintendent may designate. Under the current requirement, the New York Agency is required to maintain a pledge of a minimum of $2 million with respect to its total third-party liabilities and such pledge may be up to 1% of the agency’s third party liabilities, or upon meeting eligibility criteria, up to a maximum amount of $100 million. At December 31, 2008, the New York Agency maintained a pledge of $5.5 million, complying with the minimum required amount.

In addition, the Superintendent retains the authority to impose specific asset maintenance requirements upon individual agencies of foreign banks on a case-by-case basis. No special requirement has been prescribed for the New York Agency.

The New York Banking Law generally limits the amount of loans to any one person to 15 percent of the capital, surplus fund and undivided profits of a bank. For foreign bank agencies, the lending limits are based on the capital of the foreign bank and not that of the agency.

The Superintendent is authorized to take possession of the business and property of a New York agency of a foreign bank whenever an event occurs that would permit the Superintendent to take possession of the business and property of a state-chartered bank. These events include the violation of any law, unsafe business practices, an impairment of capital, and the suspension of payments of obligations. In liquidating or dealing with an agency’s business after taking possession of the agency, the New York Banking Law provides that the claims of creditors which arose out of transactions with the agency may be granted a priority with respect to the agency’s assets over other creditors of the foreign bank.

~~Florida Law~~. The Florida International Administrative Office, established in October 2006, is licensed and supervised by the Florida Office of Financial Regulation under the Florida Financial Institutions Codes. The activities of the Florida International Administrative Office are subject to the restrictions described below as well as to Florida banking laws and regulations that are applicable generally to foreign banks that operate offices in Florida. The Florida International Administrative Office is also subject to regulation by the U.S. Federal Reserve Board under the International Banking Act of 1978 (the “IBA”).

Pursuant to Florida law, the Florida International Administrative Office is authorized to conduct certain “back office” functions on behalf of the Bank, including administration of the Bank’s personnel and operations, data processing and record keeping activities, and negotiating and servicing loans or extensions of credit and investments. Under the provisions of the IBA and the regulations of the U.S. Federal Reserve Board, the Florida International Administrative Office is also permitted to function as a representative office of the Bank. In this capacity it may solicit new business for the Bank and conduct research. It may also act in a liaison capacity between the Bank and its customers.

Federal Law.

In addition to being subject to New York and Florida state laws and regulations, the New York Agency and the Florida International Administrative Office are subject to federal regulations, primarily under the IBA, and are subject to examination and supervision by the U.S. Federal Reserve Board. The IBA generally extends federal banking supervision and regulation to the U.S. offices of foreign banks and to the foreign bank itself. Under the IBA, the U.S. branches and agencies of foreign banks, including the New York Agency, are subject to reserve requirements on certain deposits. At present, the New York Agency has no deposits subject to such requirements. The New York Agency also is subject to reporting and examination requirements imposed by the U.S. Federal Reserve Board similar to those imposed on domestic banks that are members of the U.S. Federal Reserve System. The Foreign Bank Supervision Enhancement Act of 1991 (the “FBSEA”) amended the IBA to enhance the authority of the U.S. Federal Reserve Board to supervise the operations of foreign banks in the United States. In particular, the FBSEA expanded the U.S. Federal Reserve Board’s authority to regulate the entry of foreign banks into the United States, supervise their ongoing operations, conduct and coordinate examinations of their U.S. offices with state banking authorities, and terminate their activities in the United States for violations of law or for unsafe or unsound banking practices.

In addition, under the FBSEA, state-licensed branches and agencies of foreign banks may not engage in any activity that is not permissible for a “federal branch” (i.e., a branch of a foreign bank licensed by the federal government through the OCC, rather than by a state), unless the U.S. Federal Reserve Board has determined that such activity is consistent with sound banking practices.

The New York Agency does not engage in retail deposit-taking in the United States, and deposits with the New York Agency are not insured by the Federal Deposit Insurance Corporation (“FDIC”). Under the FBSEA, the New York Agency may not obtain FDIC insurance and generally may not accept deposits of less than $100,000, but may accept limited types of deposits over $100,000 to the extent authorized by the Superintendent of Banks of the State of New York.

The IBA also restricts the ability of a foreign bank with a branch or agency in the United States to engage in non-banking activities in the United States, to the same extent as a U.S. bank holding company. Bladex is subject to certain provisions of the Federal Bank Holding Company Act of 1956 (the “BHCA”) because it maintains an agency in the United States. Generally, any nonbanking activity engaged in by Bladex directly or through a subsidiary in the United States is subject to certain limitations under the BHCA. Under the Gramm-Leach-Bliley Financial Modernization Act of 1999 (the “GLB Act”), a foreign bank with a branch or agency in the United States may engage in a broader range of non-banking financial activities, provided it is qualified and has filed a declaration with the U.S. Federal Reserve Board to be a “financial holding company” (“FHC”). Bladex filed an application with the U.S. Federal Reserve Board to obtain financial holding company status on January 29, 2008. The U.S. Federal Reserve Board is in the process of evaluating Bladex’s application. At present, Bladex has two direct subsidiaries in the United States. The first direct subsidiary is Bladex Holdings, a company incorporated under Delaware law that is not engaged in any activity, other than owning Bladex Asset Management, Inc., and Clavex LLC, both Delaware companies. The other direct subsidiary is BCG PA LLC, a fifty percent (50%) owned subsidiary incorporated under the laws of Delaware.

In addition, pursuant to the Financial Services Regulatory Relief Act of 2006, the Securities and Exchange Commission (“~~SEC”~~Commission”) and the U.S. Federal Reserve Board finalized Regulation R. Regulation R defines the scope of exceptions provided for in the GLB Act for securities activities which banks may conduct without registering with the ~~SEC~~Commission as securities brokers or moving such activities to a broker-dealer affiliate. The “push out” rules exceptions contained in Regulation R enable banks, subject to certain conditions, to continue to conduct securities transactions for customers as part of the bank’s trust and fiduciary, custodial, and deposit “sweep” functions, and to refer customers to a securities broker-dealer pursuant to a networking arrangement with the broker-dealer. The New York Agency is subject to Regulation R with respect to its securities activities.

New York State Law

The New York Agency, established in 1989, is licensed by the Superintendent of Banks of the State of New York (the “Superintendent”) under the New York Banking Law. The New York Agency maintains an international banking facility that also is regulated by the Superintendent and the U.S. Federal Reserve Board. The New York Agency is examined by the New York State Banking Department and is subject to banking laws and regulations applicable to a foreign bank that operates a New York agency. New York agencies of foreign banks are regulated substantially the same as, and have similar powers to, New York state-chartered banks, except with respect to capital requirements and deposit-taking activities.

The Superintendent is empowered by law to require any branch or agency of a foreign bank to maintain in New York specified assets equal to a percentage of the branch’s or agency’s liabilities, as the Superintendent may designate. Under the current requirement, the New York Agency is required to maintain a pledge of a minimum of $2 million with respect to its total third-party liabilities and such pledge may be up to 1% of the agency’s third party liabilities, or upon meeting eligibility criteria, up to a maximum amount of $100 million. As of December 31, 2009, the New York Agency maintained a pledge of $5.5 million, complying with the minimum required amount.

Florida Law

The Florida International Administrative Office, established in October 2006, is licensed and supervised by the Florida Office of Financial Regulation under the Florida Financial Institutions Codes. The activities of the Florida International Administrative Office are subject to the restrictions described below as well as to Florida banking laws and regulations that are applicable generally to foreign banks that operate offices in Florida. The Florida International Administrative Office is also subject to regulation by the U.S. Federal Reserve Board under the International Banking Act of 1978 (the “IBA”).

Pursuant to Florida law, the Florida International Administrative Office is authorized to conduct certain “back office” functions on behalf of the Bank, including administration of the Bank’s personnel and operations, data processing and record keeping activities, and negotiating and servicing loans or extensions of credit and investments. Under the provisions the Florida Financial Institutions Codes, as well as the IBA and the regulations of the U.S. Federal Reserve Board, the Florida International Administrative Office is also permitted to function as a representative office of the Bank. In this capacity it may solicit new business for the Bank and conduct research. It may also act in a liaison capacity between the Bank and its customers.

Anti-Money Laundering ~~Laws.~~Laws

U.S. anti-money laundering laws, as amended by the USA PATRIOT Act of 2001, impose significant compliance and due diligence obligations, on financial institutions doing business in the United States. Both the New York Agency and the Florida International Administrative Office are “financial institutions” for these purposes. Failure of a financial institution to comply with the requirements of these laws and regulations could have serious legal and reputational consequences for an institution. The New York Agency and the Florida International Administrative Office have adopted comprehensive policies and procedures to address these requirements.

Cayman Islands Law

Bladex Offshore Feeder Fund and Bladex Capital Growth Fund are exempted companies that were incorporated in the Cayman Islands with limited liability on February 21, 2006 under the Companies Law of the Cayman Islands. The registered office of these companies is at PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands.

The Companies Law ~~(2007~~(2009 Revision) of the Cayman Islands (the "Companies Law") is derived, to a large extent, from the older Companies Acts of England, although there are significant differences between the Companies Law and the current Companies Act of England. Section ~~193~~174 of the Companies Law does not permit the Bladex Offshore Feeder Fund and the Bladex Capital Growth Fund to trade in the Cayman Islands with any person, firm or corporation except in furtherance of the business of these companies carried on outside the Cayman Islands. This does not prevent the Bladex Offshore Feeder Fund and the Bladex Capital Growth Fund from executing contracts in the Cayman Islands and exercising in the Cayman Islands all of their powers necessary for the carrying on of their business outside the Cayman Islands.

The Proceeds of Crime Law, 2008 of the Cayman Islands and the Terrorism Law ~~2003~~(2009 Revision) of the Cayman Islands impose reporting obligations on residents of the Cayman Islands who know or suspect, or have reasonable grounds for knowing or suspecting, the involvement of another person in ~~money laundering~~criminal conduct or with terrorism or terrorist ~~activities.~~property and the information for that knowledge or suspicion came to their attention in the course of business in the regulated sector.

The Bank is subject to banking regulations in each jurisdiction in which the Bank has a physical presence.

C.	Organizational Structure

For information regarding the Bank’s organizational structure, see Item 18, “Financial Statements,” note 1.


D.	Property, Plant and Equipment

The Bank owns its ~~main branch,~~headquarters office, with 6,161 square meters of office space, located at Calle 50 and Aquilino de la Guardia in Panama ~~City.~~City, Panama. The Bank leases 11.2 square meters of computer equipment hosting, located at Gavilan Street Balboa in Panama City, Panama and 21.2 square meters of office space and ~~Internet~~internet access in case of a contingency, located at 75E Street San Francisco, in Panama ~~City.~~City, Panama. In addition, the Bank leases office space for its representative offices in Mexico ~~Buenos Aires,~~and Argentina, Bladex Representação Ltda. in Brazil, its New York Agency and Bladex Asset Management in New York City, New York and the Florida International Administrative Office in ~~Miami.~~Miami, Florida. See Item 18, “Financial Statements,” notes ~~2(o)~~2(q) and ~~20.~~19.

Item 4A.

Unresolved Staff Comments

None.

Item 5.

Operating and Financial Review and Prospects

The following discussion should be read in conjunction with the Bank’s Consolidated Financial Statements and the notes thereto included elsewhere in this Annual Report. See Item 18, “Financial Statements.”

Nature of Earnings

The Bank derives income from net interest income, fees and commissions, derivative financial instruments and hedging, recoveries on assets, net of ~~impairments;~~impairments, net gain (loss) from investment fund trading, net gain (loss) from trading securities, net gain on sale of securities available-for-sale, and net gain (loss) on foreign currency exchange. Net interest income, or the difference between the interest income the Bank receives on its interest-earning assets and the interest it pays on interest-bearing liabilities, is generated principally by the Bank’s lending activities. The Bank generates fees and commissions mainly through the issuance, confirmation and negotiation of letters of credit and guarantees covering commercial and country risk, and through loan origination and sales.

Operating Results

The following table summarizes changes in components of the Bank’s net income and performance ~~at and~~ for the periods indicated:

	Year Ended December 31,
	2009			2008			2007
	(in $ thousand, except per share amounts and percentages)
Total interest income	$	141,964		$	244,243		$	264,869
Total interest expense		77,212			166,396			194,299
Net interest income		64,752			77,847			70,570
Reversal (provision) for loan losses		(18,293	)		18,540			(11,994	)
Net interest income after reversal (provision ) for loan losses		46,459			96,387			58,576
Other income (expense):
Reversal (provision) for losses on off-balance sheet credit risk		3,463			(16,997	)		13,468
Fees and commissions, net		6,733			7,252			5,555
Derivative financial instruments and hedging		(2,534	)		9,956			(989	)
Impairment of assets, net of recoveries		(120	)		(767	)		(500	)
Net gain from investment fund trading		24,997			21,357			23,878
Net gain (loss) from trading securities		13,113			(20,998	)		(12	)
Net gain on sale of securities available-for-sale		546			67			9,119
Gain (loss) on foreign currency exchange		613			(1,596	)		115
Other income (expense), net		912			656			(6	)
Net other income (expense)		47,723			(1,070	)		50,628
Total operating expenses		(38,202	)		(39,990	)		(37,027	)
Net income		55,980			55,327			72,177
Net income attributable to the redeemable noncontrolling interest		(1,118	)		(208	)		0
Net income attributable to Bladex	$	54,862		$	55,119		$	72,177
Basic earnings per share	$	1.50		$	1.51		$	1.99
Diluted earnings per share	$	1.50		$	1.51		$	1.98
Return on average assets		1.38	%		1.09	%		1.76	%
Return on average stockholders’ equity		8.60	%		8.99	%		11.91	%

At and For the Year Ended December 31,
2008 2007 2006
(in $ thousand, except per share amounts and percentages)
Total interest income $ 244,243 $ 264,869 $ 203,350
Total interest expense 166,396 194,299 144,513
Net interest income 77,847 70,570 58,837
Reversal (provision) for loan losses 18,540 (11,994 ) (11,846 )
Net interest income after reversal (provision ) for loan losses 96,387 58,576 46,991
Other income (expense):
Reversal (provision) for losses on off-balance sheet credit risk (16,997 ) 13,468 24,891
Fees and commissions, net 7,252 5,555 6,393
Derivative financial instruments and hedging 9,956 (989 ) (225 )
Recoveries of assets, net of impairments (767 ) (500 ) 5,551
Net gain (loss) from investment fund trading 21,357 23,878 1,091
Net gain (loss) from trading securities (20,998 ) (12 ) (212 )
Net gain on sale of securities available-for-sale 67 9,119 2,568
Gain (loss) on foreign currency exchange (1,596 ) 115 (253 )
Other income (expense), net 656 (6 ) 36
Net other income (1,070 ) 50,628 39,840
Total operating expenses (39,990 ) (37,027 ) (28,929 )
Income before participation of the minority interest in gains of the investment fund 55,327 72,177 57,902
Participation of the minority interest in gains of the investment fund (208 ) 0 0
Net income $ 55,119 $ 72,177 $ 57,902
Basic earnings per share 1.51 1.99 1.56
Diluted earnings per share 1.51 1.98 1.54
Return on average assets 1.09 % 1.76 % 1.70 %
Return on average stockholders’ equity 8.99 % 11.91 % 9.96 %

Business Segment Analysis

For further information on net income by business segment, see Item 18, “Financial Statements,” note 25.

The Commercial Division

The Commercial Division is responsible for the Bank’s core business of financial intermediation and fee generation activities. The division’s portfolio includes loan portfolio and contingencies and other assets. The Commercial Division’s net income, which includes net interest income from loans, fees and commissions, allocated operating expenses, the reversal (provision) for credit losses, and any impairment on assets, net of recoveries, amounted to $35 million for the year ended December 31, 2009, compared to $59 million for the year ended December 31, 2008. This $24 million decrease was due to a $1.1 billion, or a 30%, decrease in the average loan portfolio and a 188 bps decrease in this portfolio’s average LIBOR rate, partially offset by a 94 bps increase in average lending spreads. The lower average volumes in the commercial portfolio resulted from the Bank’s decision, in late 2008, to slow its lending activities in line with the adverse economic environment, collecting maturities in vulnerable sectors, building liquidity balances, and responding to a decrease in funding sources.

2429

The Commercial Division’s net income was $59 million in 2008, compared to a net income of $44 million in 2007. The $15 million increase during 2008 compared to 2007 was primarily due to higher average loan balances of $352 million, or 10% during the year, as well as higher weighted average lending spreads, which increased 59 bps, or 54%, during the year.

The Treasury Division

The Treasury Division recorded net income of $6 million for the year ended December 31, 2009, compared to a net loss of $16 million for the year ended December 31, 2008. This $22 million, or 137%, increase was mainly attributable to $13 million in gains from trading securities, compared to $21 million in losses from trading in 2008.

The Treasury Division reported a net loss of $16 million in 2008 and a net income of $10 million for 2007. The Treasury Division’s 2008 results were affected by the accounting treatment related to certain securities-based financing transactions (repos), which were recorded as sales based on the application of ASC Topic 860. Due to unfavorable market conditions affecting the terms of these repos, the Bank recognized these repo transactions as securities sales, rather than as secured borrowings (financing). This accounting treatment resulted in a non-cash charge to earnings of $25 million, partially offset by a $12 million gain related to the application of ASC Topic 820 to the Bank’s local funding cross currency swaps during the particularly volatile fourth quarter of 2008.

The Asset Management Division

The Asset Management Division is responsible for the Bank’s asset management activities. The Asset Management Division’s net income attributable to Bladex, which includes net interest income from the investment fund, gains from investment fund trading, related other income (loss), allocated operating expenses, net of net income attributable to the redeemable non-controlling interest totaled $14 million for the year ended December 31, 2009, compared to $12 million for the year ended December 31, 2008. This $2 million, or 15% increase in net income attributable to Bladex was mainly due to the combined effect of a $4 million increase in non-interest operating income attributed to increased gains from investment fund trading, partially offset by a $1 million increase in operating expenses, mainly related to an increase in performance-based expenses and by a $1 million increase in net income attributable to the redeemable noncontrolling interest.

The Asset Management Division’s net income attributable to Bladex amounted to $12 million in 2008, compared to $18 million in 2007. This $6 million decrease was attributable principally to lower net gains from investment fund trading and lower net interest income, resulting mainly from decreased market interest rates in 2008.

Net Income attributable to Bladex

For the year ended December 31, 2009, net income attributable to Bladex was $54.9 million, decreasing from $55.1 million for the year ended December 31, 2008. The 2009 results were driven by $35 million in net income in the Commercial Division, $14 million in net income attributable to Bladex in the Asset Management Division, and $6 million in net income in the Treasury Division. The 2009 results, when compared to 2008, reflect lower average credit volumes and lower average market interest rates during an extremely difficult global market environment, partially offset by higher lending spreads.

~~The Bank’s net~~

Net income attributable to Bladex for 2008 was ~~$55~~$55.1 million compared to ~~$72~~$72.2 million for 2007. The Bank’s 2008 results were mainly driven by the Commercial Division’s net income of $59 million and the Asset Management Division’s net income attributable to Bladex of $12 million, partially offset by the Treasury Division’s net loss of $16 million. The Bank’s 2008 results also include the impact of classifying certain securities financings (repos) as outright sales, mostly recorded by the Treasury Division, required by the application of ~~FASB Statement No. 140, “Accounting for~~Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (“ASC”) Topic 860 – Transfers and Servicing, ~~of Financial Assets and Extinguishments of Liabilities” (“FASB Statement No. 140”),~~ as well as the positive impact of ~~FASB Statement No. 157, “Fair~~ASC Topic 820 - Fair Value ~~Mensurements” (“FASB Statement No. 157”).~~Measurements and Disclosure. The application of these two ~~FASB Statements~~accounting standards amounted to a loss of $13 million during the ~~particulary volatile~~ second half of 2008.

The Commercial Division is responsible for the Bank’s financial intermediation and fee generation activities. The Commercial Division’s net income, which includes net interest income from loans, fees and commissions and other income derived from financial services and off-balance sheet credits (letters of credit, guarantees and credit commitments), allocated operating expenses, and reversals of (provisions for) credit losses, amounted to $59 million in 2008, compared to $44 million in 2007. The $15 million increase was primarily due to higher average loan balances of $352 million, or 10% during the year, as well as higher weighted average lending spreads, which increased 57 basis points, or 56%, during the year.

The Treasury Division is responsible for the Bank’s liquidity management and investment securities activities. The Treasury Division’s net income includes net interest income on treasury assets (interest-bearing deposits with banks, investment securities, and trading assets), related net other income (expense), such as net gain (loss) from trading, the sale of securities available-for-sale, foreign currency exchange, derivative financial instruments and hedging; and allocated operating expenses. The Treasury Division reported a net loss of $16 million for 2008, compared to net income of $10 million for 2007. The Treasury Division’s 2008 results were affected by the accounting treatment related to certain securities-based financing transactions (repos), which were recorded as sales. Based on the application of FASB Statement No. 140 and related guidance, the higher haircuts applied to the repos due to market conditions resulted in the Bank having to recognize these transactions as outright securities sales, rather than as secured borrowings (financing). This accounting treatment resulted in a non-cash charge to earnings of $25 million, partially offset by a $12 million gain related to the application of FASB Statement No. 157 to the Bank’s local funding cross currency swaps during the particularly volatile fourth quarter of 2008.

The Asset Management Division is responsible for the Bank’s asset management activities. The Asset Management Division’s net income, which includes net interest income on investment fund, gains (losses) from investment fund trading, related other income (loss), and allocated operating expenses, amounted to $12 million in 2008, compared to $18 million in 2007. The $6 million decrease was attributable principally to lower net gains from investment fund trading and lower net interest income, resulting mainly from decreased market interest rates.

The Bank’s net income for 2007 was $72 million, compared to $58 million for 2006, a $14 million, or 25%, increase. This increase was mainly attributable to a $12 million, or 20%, increase in net interest income (mostly from the Commercial Division), $23 million in higher gains from investment fund trading by the Asset Management Division, and a $7 million increase in net gain on sale of securities available-for-sale by the Treasury Division, partly offset by an $8 million increase in operating expenses, an $11 million decrease in reversal of provision for off-balance sheet credit risk and a $6 million decrease in recoveries on assets, net of impairments.

~~For further information on net income by business segment, see Item 18, “Financial Statements,” note 26.~~

Net Interest Income and Margins

The following table sets forth information regarding net interest income, the Bank’s net interest ~~income, net interest~~ margin ~~(the net~~(net interest income divided by the average balance of interest-earning assets), and the net interest spread (the average yield earned on interest-earning assets, less the average yield paid on interest-bearing liabilities) for the periods indicated:

	For the Year Ended December 31,									For the Year Ended December 31,
	2008			2007			2006			2009			2008			2007
	(in $ million, except percentages)									(in $ million, except percentages)
Net interest income
Commercial Division	$	78.1		$	64.5		$	50.7		$	66.2		$	78.1		$	64.5
Treasury Division		3.0			5.9			6.9			2.0			3.0			5.9
Asset Management Division		(3.2	)		0.1			1.2			(3.4	)		(3.2	)		0.1
Consolidated	$	77.9		$	70.5		$	58.8		$	64.8		$	77.9		$	70.5
Net interest margin		1.55	%		1.73	%		1.78	%		1.62	%		1.55	%		1.73	%
Net interest spread		0.98	%		0.78	%		0.69	%		1.12	%		0.98	%		0.78	%

The $7 million, or 10%, increase in net interest income in 2008 compared to 2007 mainly reflected increased lending spreads and higher average loan balances for the first three quarters of 2008 in the Commercial Division. The 18 basis points decrease in net interest margin in 2008 compared to 2007 was mainly due to lower interest rates, as well as the cost of carrying higher liquidity, particularly towards the end of the 2008. During 2008, there was less credit available, as well as higher risks and less competition in the Region. As a result the Bank was able to increase lending margins on new disbursements.

The $12 million, or 20%, increase in net interest income in 2007 compared to 2006 was the result of higher average balances in the loan portfolio (24%) and increased weighted average lending spreads over the cost of funds. The 5 basis points decrease in net interest margin in 2007 compared to 2006 was mainly due to higher leveraging of the balance sheet and by non-recurring interest income on non-accrual loans received on a cash basis during 2006, both of which offset higher lending spreads during 2007.

The 2008 and 2007 increase in loan portfolio average balances and lending spreads was attributable to the Bank’s strategy to improve client and geographic portfolio diversification, by increasing its exposure to the corporate client segment in several countries in the Region.

Distribution of Assets, Liabilities and Stockholders’ Equity; Interest Rates and Differentials

The following table presents the distribution of consolidated average assets, liabilities and stockholders’ equity, as well as the total dollar amounts of interest income from average interest-earning assets and the resulting yields, the dollar amounts of interest expense and average interest-bearing liabilities, and corresponding information regarding rates. Average balances have been computed on the basis of consolidated daily average ~~balance sheets:~~

balances:

Year ended December 31,

2008

2007

2006

Description

Average
balance

Interest

Average
yield/rate

Average
balance

Interest

Average
yield/rate

Average
balance

Interest

Average
yield/rate

(in $ million, except percentages)
Interest-Earning Assets
Interest-bearing deposits with banks $ 414 $ 8 1.80 % $ 248 $ 13 5.06 % $ 126 $ 6 4.73 %
Loans, net 3,718 200 5.29 % 3,366 222 6.49 % 2,715 166 6.02 %
Trading assets 0 1 n.m (*) 0 0 n.m. (*) 0 0 n.m. (*)
Investment securities 756 32 4.23 % 345 21 5.99 % 390 23 5.76 %
Investment fund 138 3 2.49 % 113 10 8.40 % 69 9 12.47 %
Total interest-earning assets $ 5,025 $ 244 4.78 % $ 4,072 $ 265 6.42 % $ 3,300 $ 203 6.08 %
Non-interest-earning assets 93 88 89
Allowance for loan losses (70 ) (62 ) (44 )
Other assets 15 11 16
Total Assets $ 5,064 $ 4,108 $ 3,361
Interest-Bearing Liabilities
Deposits $ 1,500 $ 44 2.91 % $ 1,321 $ 70 5.26 % $ 1,106 $ 57 5.05 %
Investment Fund 0 2 n.m (*) 0 4 n.m (*) 0 5 n.m. (*)
Securities sold under repurchase agreements 540 17 3.09 % 253 14 5.36 % 306 16 5.29 %
Short-term borrowings 1,089 46 4.18 % 1,019 57 5.47 % 736 39 5.17 %
Borrowings and long-term debt 1,182 56 4.70 % 809 49 6.02 % 500 28 5.57 %
Total interest-bearing liabilities $ 4,310 $ 166 3.80 % $ 3,402 $ 194 5.63 % $ 2,647 $ 145 5.38 %
Non-interest bearing liabilities and other liabilities 137 100 132
Total Liabilities $ 4,448 $ 3,502 $ 2,779
Minority interest in investment fund 3 0 0
Stockholders’ equity 613 606 581
Total Liabilities and Stockholders’ Equity $ 5,064 $ 4,108 $ 3,361
Net Interest Spread 0.98 % 0.78 % 0.69 %
Net Interest Income and Net Interest Margin $ 78 1.55 % $ 71 1.73 % $ 59 1.78 %

~~(*)~~ ~~“n.m.” means not meaningful~~

	Year ended December 31,
	2009								2008								2007
Description	Average balance			Interest		Average yield/rate			Average balance			Interest		Average yield/rate			Average balance			Interest		Average yield/rate
	(in $ million, except percentages)
Interest-Earning Assets
Interest-earning deposits with banks	$	592		$	1		0.21	%	$	414		$	8		1.80	%	$	248		$	13		5.06	%
Loans, net of unearned income & deferred loan fees		2,569			113		4.36	%		3,718			200		5.29	%		3,366			222		6.49	%
Non-accrual loans		17			1		4.92	%		0			0	n.m.		(*)		0			0	n.m.		(*)
Trading assets		102			7		6.95	%		0			1	n.m.		(*)		0			0	n.m.		(*)
Investment securities(1)		546			17		3.15	%		756			32		4.23	%		345			21		5.99	%
Investment fund		172			2		1.01	%		138			3		2.49	%		113			10		8.40	%
Total interest-earning assets	$	3,998		$	142		3.50	%	$	5,025		$	244		4.78	%	$	4,072		$	265		6.42	%
Non-interest-earning assets		46								93								88
Allowance for loan losses		(79	)							(70	)							(62	)
Other assets		9								15								11
Total Assets	$	3,975							$	5,064							$	4,108
Interest-Bearing Liabilities

2631

	Year ended December 31,
	2009							2008							2007
Description	Average balance		Interest		Average yield/rate			Average balance		Interest		Average yield/rate			Average balance		Interest		Average yield/rate
	(in $ million, except percentages)
Deposits	$	1,218	$	11		0.93	%	$	1,500	$	44		2.91	%	$	1,321	$	70		5.26	%
Trading liabilities		9		0	n.m.		(*)		0		0	n.m		(*)		0		0	n.m		(*)
Investment fund		0		2	n.m.		(*)		0		2	n.m		(*)		0		4	n.m		(*)
Securities sold under repurchase agreements		263		6		2.24	%		540		17		3.09	%		253		14		5.36	%
Short-term borrowings		501		18		3.50	%		1,089		46		4.18	%		1,019		57		5.47	%
Borrowings and long-term debt		1,208		40		3.24	%		1,182		56		4.70	%		809		49		6.02	%
Total interest-bearing liabilities	$	3,199	$	77		2.38	%	$	4,310	$	166		3.80	%	$	3,402	$	194		5.63	%
Non-interest bearing liabilities and other liabilities	$	122						$	137						$	100
Total Liabilities	$	3,321						$	4,448						$	3,502
Redeemable noncontrolling interest in the investment fund		16							3							0
Stockholders’ equity		638							613							606
Total Liabilities and Stockholders’ Equity	$	3,975						$	5,064						$	4,108
Net interest spread						1.12	%						0.98	%						0.78	%
Net interest income and net interest margin			$	65		1.62	%			$	78		1.55	%			$	71		1.73	%

(*)	“n.m.” means not meaningful

(1)	The average yield of the investment securities portfolio using cost-based average balances, would have been 3.46%, 4.55%, and 6.60% for 2009, 2008 and 2007, respectively.

Changes in Net Interest Income — Volume and Rate Analysis

Net interest income is affected by changes in volume and changes in interest rates. Volume changes are caused by differences in the level of interest-earning assets and interest-bearing liabilities. Rate changes result from differences in yields earned on interest-earning assets and rates paid on interest-bearing liabilities. The following table sets forth a summary of the changes in net interest income of the Bank resulting from changes in average interest-earning asset and interest-bearing liability ~~balances (volume)~~volume and changes in average interest rates for 2009 compared to 2008 and for 2008 compared to ~~2007 and for 2007 compared to 2006.~~2007. Volume and rate variances have been calculated based on movements in average balances over the period and changes in interest rates on average interest-earning assets and average interest-bearing liabilities. ~~Variances caused by changes in both volume and rates have been allocated equally to volume and rate.~~

	2009 vs. 2008									2008 vs. 2007
	Volume(*)			Rate(*)			Net Change			Volume(*)		Rate(*)			Net Change
	(in $ thousand)
Increase (decrease) in interest income
Interest-bearing deposits with banks	$	378		$	(6,691	)	$	(6,313	)	$	3,036	$	(8,192	)	$	(5,155	)
Loans, net		(50,719	)		(35,846	)		(86,565	)		19,135		(40,712	)		(21,576	)
Non-accrual loans		847			0			847			0		0			0
Trading assets		7,158			(648	)		6,510			0		648			648
Investment securities		(6,688	)		(8,346	)		(15,034	)		17,659		(6,101	)		11,559
Investment fund		356			(2,078	)		(1,723	)		637		(6,739	)		(6,102	)
Total increase (decrease)	$	(48,669	)	$	(53,609	)	$	(102,279	)	$	40,468	$	(61,094	)	$	(20,627	)
Increase (decrease) in interest expense
Deposits	$	(2,663	)	$	(30,208	)	$	(32,871	)	$	5,325	$	(31,403	)	$	(26,078	)
Trading liabilities		0			0			0			0		0			0
Investment fund		0			29			29			0		(1,900	)		(1,900	)
Securities sold under repurchase agreements		(6,294	)		(4,701	)		(10,995	)		9,019		(5,805	)		3,214
Short-term borrowings		(20,863	)		(7,652	)		(28,515	)		2,998		(13,269	)		(10,271	)
Borrowings and long-term debt		878			(17,710	)		(16,831	)		17,853		(10,720	)		7,133
Total increase (decrease)	$	(28,941	)	$	(60,243	)	$	(89,184	)	$	35,195	$	(63,098	)	$	(27,903	)
Increase (decrease) in net interest income	$	(19,728	)	$	6,633		$	(13,095	)	$	5,273	$	2,004		$	7,276

(*)	Volume variation effect in net interest income is calculated by multiplying the difference in average volumes by the current year’s average yield. Rate variation effect in net interest income is calculated by multiplying the difference in average yield by the prior year’s average volume.

2008 vs. 2007

2007 vs. 2006

Volume

Rate

Net Change

Volume

Rate

Net
Change

(in $ thousand)
Increase (decrease) in interest income
Interest-bearing deposits with banks $ 3,036 $ (8,192 ) $ (5,155 ) $ 6,282 $ 412 $ 6,694
Loans, net 19,135 (40,712 ) (21,576 ) 42,863 12,957 55,819
Trading assets 0 648 648 0 0 0
Investment securities 17,659 (6,101 ) 11,559 (2,728 ) 896 (1,832 )
Investment fund 637 (6,739 ) (6,102 ) 3,693 (2,854 ) 839
Total increase (decrease) $ 40,468 $ (61,094 ) $ (20,627 ) $ 50,109 $ 11,411 $ 61,519
Increase (decrease) in interest expense
Deposits $ 5,325 $ (31,403 ) $ (26,078 ) $ 11,502 $ 2,330 $ 13,832
Investment Fund 0 (1,900 ) (1,900 ) 0 (443 ) (443 )
Securities sold under repurchase agreements 9,019 (5,805 ) 3,214 (2,895 ) 204 (2,690 )
Short-term borrowings 2,998 (13,269 ) (10,271 ) 15,746 2,239 17,986
Borrowings and long term debt 17,853 (10,720 ) 7,133 18,844 2,257 21,101
Total increase (decrease) $ 35,195 $ (63,098 ) $ (27,903 ) $ 43,198 $ 6,588 $ 49,786
Increase (decrease) in net interest income $ 5,273 $ 2,004 $ 7,276 $ 6,911 $ 4,823 $ 11,734
Net Interest Income and Net Interest Margin Variation

2009 vs. 2008

The $13 million, or 17% decrease in net interest income for the year ended December 31, 2009 compared to the year ended December 31, 2008 primarily reflects:

Lower average volumes in the loan and investment securities portfolio, which decreased by $1.2 billion, or 28%, from $4.4 billion in 2008 to $3.2 billion in 2009, and resulted in a $49 million decrease in interest income, partly offset by a $29 million decrease in interest expense due to an overall decrease of $1.1 billion, or 37%, in average short-term liabilities (deposits, securities sold under repurchase agreements and short-term borrowings), from $3.1 billion in 2008 to $2.0 billion in 2009. The net effect of lower average volumes in interest-earning assets and interest-bearing liabilities was a $20 million decrease in net interest income, and was the result of the deteriorating global economic environment, which led the Bank to collect loans in vulnerable sectors, allowing it to build levels of liquidity and respond to tighter funding sources in anticipation of worsening economic conditions. Through this course of action, the Bank was able to largely offset the negative effect of decline in client deposits and decreases in interbank funding lines; and

ii.

Lower average interbank market rates for the Bank’s assets and liabilities, which resulted in a $7 million increase in net interest income due to rate variances, as the rates for liabilities decreased at a higher pace than the rates for assets. The average yield paid on interest-bearing liabilities decreased by 142 bps to 2.38% in 2009 (from 3.80% in 2008), mainly due to lower interbank market rates, while the average yield on interest-earning assets decreased by 128 bps, to 3.50% in 2009 (from 4.78% in 2008), also attributable to lower interbank market rates, the effects of which were partially offset by higher lending credit spreads in the Bank’s loan portfolio.

Net interest ~~income for 2008 increased $7 million~~margin stood at 1.62% in 2009 compared to ~~2007 due to: (1) increased~~1.55% in 2008. The 7 bps increase in net interest margin during 2009, compared to 2008, was mainly attributable to higher average ~~volumes, mainly~~lending spreads (net interest spread in the loan ~~and investment securities portfolios, mainly funded~~portfolio increased by ~~increased levels~~48 basis points), given the disproportionate decreases in interest rates for assets versus liabilities, partially offset by the cost of ~~borrowings, which resulted in~~maintaining a $5higher average liquidity balance throughout the year at a minimal yield.

2008 vs. 2007

The $7 million, ~~net~~or 10%, increase in net interest income ~~and (2) lower inter-bank~~in 2008 compared to 2007 primarily reflected:

Higher average volumes of interest-earning assets, particularly the loan and investment securities portfolio, which increased by $0.7 billion, or 21%, and the average interest-earning deposits with banks, which increased by $0.2 billion. The interest-earning assets’ average volume increase resulted in a $40 million increase in interest income for the year 2008. This increase in assets was mainly funded by a $0.9 billion increase in average interest-bearing liabilities, which resulted in a $35 million increase in interest expense. The net result of higher asset and liability average volumes was an increase of $5 million in net interest income. The increase in average loan and investment securities portfolio’s average balances was attributable to the Bank’s strategy to improve client and geographic portfolio diversification, by increasing its exposure to the corporate client segment in several countries in the Region. The increase in average interest-earning deposits with banks relates to the Bank’s focus on maintaining high liquidity levels towards the last months of the year, following the global financial crisis; and

ii.

Lower average interbank market rates in the Bank’s assets and liabilities, which resulted in a $2 million net increase in net interest income due to rate variances, as the liabilities’ rates decreased at a higher pace, thereby increasing the overall net interest spread. The average yield paid on interest-bearing liabilities decreased by 183 bps to 3.80% in 2008 (from 5.63% in 2007), mainly due to lower interbank market rates, while the average yield on interest-earning assets decreased by 164 bps, to 4.78% in 2008 (from 6.42% in 2007), also attributable to lower interbank market rates, the effects of which were partially offset by higher lending credit spreads in the Bank’s loan portfolio.

Net interest margin for the year 2008 was 1.55%, compared to 1.73% in 2007. The 18 bps decrease in net interest ~~income,~~margin in 2008 compared to 2007 was mainly due to a lower proportion of higher-yield loan portfolio as a percentage of total interest-earning assets, replaced by minimal-yielding interest-earning deposits with banks in a lowering interbank market rate scenario. Even though net interest spread in the ~~liabilities’ rate~~loan portfolio increased by 63 basis points, it could not compensate for the decrease ~~at a higher pace.~~

~~The $12 million increase~~ in net interest ~~income for 2007 compared to 2006 was due to increased interest rates, which resulted~~spread in a $5 million increase in net interest income, reflecting higher average lending spreads over the cost of funds for the Bank’s loan portfolio and higher average inter-bank market rates in the Bank’s assets and liabilities. The $7 million increase in net interest income derived from higher volumes during 2007 was mainly attributable to an increase in the average loan portfolio and higher average liquidity balances (interest-bearing deposits with ~~banks), partially offset by an increase in the Bank’s funding through higher average liability deposits and borrowings.~~banks.

Reversal (Provision) for Loan Losses

	For the year ended December 31,
	2009			2008		2007
	(in $ million)
Brazil Specific Reserve Reversals (Provisions)		(2.4	)		0.0		0.0
Mexico Specific Reserve Reversals (Provisions)		(12.0	)		0.0		0.0
Total Specific Reserve Reversals (Provisions)		(14.4	)		0.0		0.0
Generic Reserve Reversals (Provisions) - due to changes in credit portfolio composition and risk levels		(3.9	)		18.5		(12.0	)
Total Generic Reserve Reversals (Provisions)		(3.9	)		18.5		(12.0	)
Total Reversals (Provisions) of Allowance for Loan Losses	$	(18.3	)	$	18.5	$	(12.0	)

As of December 31, 2009, the Bank had $51 million in non-accruing loans. Based on analysis of these loans, the Bank has identified impaired loans of $36 million for which specific reserves of $14 million have been allocated. The remaining of the non-accrual portfolio, of $15 million, does not present impairment; therefore, no additional specific reserves have been recorded. During 2008 and 2007, the Bank did not have any impaired or non-accrual loans outstanding.

During 2009, 2008 and 2007, there were no reversals of specific provisions for loan losses related to the impaired and restructured ~~portfolio,~~portfolio.

The $18 million provision for loan losses in 2009 was the result of: (i) a $14 million specific reserves provision assigned to non-accruing loans, and (ii) a $4 million increase in generic provision for loan losses, as ~~the Bank reduced its impaired portfolio to zero at December 31, 2006. The impaired portfolio reversals amounted to $11 million in 2006.~~a reflection of higher loan balances.

The Bank’s $19 million reversal of provision for loan losses in 2008 was due to lower generic provisions as a result of decreased loan balances. Nevertheless, the Bank increased its loan loss reserve coverage from 1.9% at December 31, 2007 to 2.1% at December 31, 2008, reflecting the impact on the Bank’s reserve model of increasing risk levels in the Region.

The Bank’s $12 million provision for loan losses in 2007 was mainly due to ~~the net effect of:~~generic provision charge, resulting from increased loan exposure.

~~a $18 million generic provision charge, resulting from increased loan exposure; and~~

~~a $6 million recovery on previously charged-off loans.~~

The Bank’s ~~$12 million provision for~~ loan ~~losses in 2006~~loss reserve coverage was ~~mainly due to the net effect of:~~

~~a $23 million generic provision charge, resulting from increased loan exposure;~~

~~a $10 million reversal related to the collection~~2.7% as of December 31, 2009, an increase from 2.1% as of ~~Argentine restructured loans during the year; and~~

~~a $1 million reversal related to the collection of a Brazilian restructured loan during the year.~~

At December 31, 2008 ~~2007~~ and ~~2006,~~from 1.9% as of December 31, 2007. The increase in the ~~Bank had zero specific provisions for~~ loan ~~losses, as it had zero credits~~loss reserve coverage reflects the impact on the Bank’s reserve model of prudent portfolio management considering increased risk levels in ~~non-accruing status (impaired).~~the Region in 2009 given continuing adverse economic conditions affecting certain borrowers.

For more detailed information, see Item 5, “Operating and Financial Review and Prospects/Operating Results/Asset Quality and Allowance for Credit Losses,” and Item 18, “Financial Statements,” note 9.8.

For more detailed information about Non-Accrual Loans, see Item 18 “Financial Statements,” note 7.

Reversal (Provision) for Losses on Off-Balance Sheet Credit Risk

The $3 million reversal of provision for losses on off-balance sheet credit risk in 2009 was primarily due to lower off-balance sheet balances in the commercial portfolio (acceptances and contingencies), and the impact on the Bank’s reserve model of prudent off-balance sheet portfolio management considering risk levels in the Region.

The $17 million provision for losses on off-balance sheet credit risk in 2008 was due to the impact of increased risk levels in the Region on the Bank’s generic reserve model. ~~As a result, the off-balance sheet reserve coverage increased to 6.9% at December 31, 2008, compared to 2.5% at December 31, 2007.~~

The $13 million reversal of provision for losses on off-balance sheet credit risk in 2007 was mainly due to decreased ~~letter of credit exposure in higher risk countries, as well as improved risk profiles in certain countries.~~off-balance sheet portfolio exposure.

The ~~$25 million reversal of provision for losses on~~ off-balance sheet ~~credit risk~~reserve coverage increased to 8.2% as of December 31, 2009, compared to 6.9% as of December 31, 2008, and compared to 2.5% as of December 31, 2007. The off-balance sheet reserve coverage increase in ~~2006~~2009 was ~~mainly due~~attributable to a ~~$15 million reduction~~shift in ~~generic reserves driven by exposure reductions~~the risk composition of the off-balance sheet portfolio, despite an overall decrease in ~~certain countries and a $10 million reversal in specific reserves resulting from the maturity~~end of ~~Argentine impaired contingencies.~~period balances.

Fees and Commissions, ~~Net~~net

The Bank generates fee and commission income primarily from originating letters of credit confirmation, guarantees (including commercial and country risk coverage), loan origination and distribution, and service activities. The following table shows the components of the Bank’s fees and commissions, net, for the periods indicated:

	For the Year Ended December 31,						For the Year Ended December 31,
	2008		2007		2006		2009		2008			2007
			(in $ thousand)						(in $ thousand)
Letters of credit	$	4,725	$	2,842	$	4,121	$	4,973	$	4,725		$	2,842
Guarantees		1,108		1,088		1,419		1,017		1,108			1,088
Loans		584		836		556		224		584			836
Third party investors (Bladex Asset Management)								281		(8	)		0
Other (1)		835		789		297		239		844			789
Fees and commissions, net	$	7,252	$	5,555	$	6,393	$	6,733	$	7,252		$	5,555

(1) Net of commission expense.

The $0.5 million decrease in fees and commissions during 2009 compared to 2008 mostly reflects lower loan commissions from reduced average loan and letter of credit balances, reflecting credit risk and demand considerations in the first half of 2009.

The $2 million increase in net fees and commissions for 2008 compared to 2007 mainly reflected higher ~~margins~~letter of credit activity from the Commercial ~~Division’s letters of credit activity.~~Division.

For detailed information, see Item 18, “Financial Statements,” notes 2(p).

The decrease of $1 million in net fees and commissions for 2007 compared to 2006 was attributable to lower letter of credit and guarantee activity during the beginning of 2007, partially offset by increased loan fees and other service activities.

2835

Derivative Financial Instruments and Hedging

In 2009 and 2008, the Bank recorded a net loss of $3 million and a gain of $10 million, respectively, in derivative financial instruments and hedging. These results reflect the effect of recording the effectiveness (ineffectiveness) on hedging relationships and the discount of the Bank’s own credit risk when calculating the fair value of its cross currency swap portfolio that it contracts for hedging purposes, which had a liability balance at the measurement date. The fair value of these cross currency swaps improved during 2009 and, as a consequence, the credit risk discount decreased when valuing these derivative instruments.

The Bank recorded a gain of $10 million in derivative financial instruments and hedging activity in 2008. This gain mainly related to the application of FASB Statement No. 157 to the Bank’s cross currency swaps that had been contracted for hedging purposes.

~~The Bank recorded losses~~loss of $1 million ~~and $225 thousand~~ in 2007 ~~and 2006, respectively,~~ related to hedging derivative instruments. The 2007 ~~losses~~loss related mainly to the fair value at their inception of interest rate swaps contracted for fair value hedge relationships that classify under the short-cut method. The difference in price at inception of these derivatives is attributable solely to the bid-ask spread between the entry transaction and a hypothetical exit transaction.relationships. The Bank maintains a policy of recognizing these price differences at the inception of a hedge relationship.

For additional information, see Item 11, “Quantitative and Qualitative Disclosure about Market Risk,” and Item 18, “Financial Statements,” notes ~~2(r)~~2(t) and ~~21.~~20.

~~Recoveries (Impairment), on Assets~~

The Bank recorded $767 thousand in impairment on assets in 2008, compared to $500 thousand in 2007. The 2008 amount was related to an equity investment in a private investment fund with book value of $2 million at the end of 2008. The 2007 amount was related to an equity investment in a company specializing in digital solutions, which was written-off and charged to earnings as its impairment was considered other than temporary.

~~For additional information, see Item 18, “Financial Statements,” notes 2(i) and 11.~~

Net Gain (Loss) from Investment Fund Trading

The Bank recorded net gains of $25 million from investment fund trading in 2009, compared to net gains of $21 million in 2008 and $24 million in 2007. The $25 million gain in 2009 was due to the realization of gains on securities of $19 million and realized gain on derivatives of $6 million.

During 2008 the Bank achieved $21 million in net gain from investment fund trading, compared to $24 million in ~~2007 and $1 million in 2006.~~2007. The $21 million net gain in 2008 was due to the net effect of a net realized gain on investments and foreign currency transactions of $20.9 million and net change in unrealized appreciation ~~(depreciation)~~ on investments and foreign currency of $0.4 million. The $24 million net gain in 2007 was due to the net effect of a net realized gain on investments and foreign currency transactions of $32.8 million and net change in unrealized depreciation on investments and foreign currency of $8.9 million in 2007.

For additional information, see Item 18, “Financial Statements,” notes 76 and ~~23.~~22.

Net Gain (Loss) from Trading Securities

The Bank recorded a ~~$21~~$13 million ~~loss~~gain from trading securities in 2009, compared to a $21 million loss in 2008, and compared to $12 thousand loss in 2007. The $13 million gain in 2009 was due to the appreciation in mark-to-market of the trading securities portfolio in 2009, which is composed of all the securities that were sold in 2008 under repo agreements accounted for as sales. The $21 million loss in 2008 was mainly due to the ~~mark-to-market~~ effect of mark-to-market on such securities and ~~related to~~ the impact of classifying certain securities financings (repos) as outright sales in 2008, as required by ~~the application of FASB Statement No. 140~~U.S. GAAP, and ~~the~~ changes in the fair value of financial instruments ~~resulting from transfers of securities~~transferred under repurchase agreements.

For additional information, see Item 18, “Financial Statements,” notes 54 and ~~13.~~12.

Net Gain on Sale of Securities Available-for-Sale

The Bank purchases debt instruments as part of its Treasury activity with the intention of selling them prior to maturity. These debt instruments are classified as securities available-for-sale and are included as part of the Bank’s credit portfolio.

The Bank’s net gain on the sale of securities available-for-sale in 2009 was $0.5 million compared to $0.1 million in 2008 ~~was $67 thousand, which included a~~and $9.1 million in 2007. Detail of the net gain of $2 million related to the sale of securities for a nominal amount of $74 million, partially offset by a loss of $2 million resulting mainly from the sale of securities under repurchase agreements accounted forgains is as ~~sales at the transfer date of those securities, as required by FASB Statement No. 140.~~follows:

The Bank’s net gain on the sale of securities available-for-sale was $9 million and $3 million in 2007 and 2006, respectively, related to the sale of securities for a nominal amount of $509 million and $105 million, respectively.

	For the year ended December 31,
	2009			2008(1)			2007
	(in $ millions)
Nominal amount	$	137.0		$	249.2		$	509.0
Amortized cost	$	(146.5	)	$	(271.0	)	$	(568.1	)
Proceeds		150.6			229.9			578.7
Net effect of unwinding hedging derivatives of the available for-sale securities portfolio		(3.6	)		(2.4	)		(1.5	)
Forward repurchase agreements		0.0			43.6			0.0
Total net gain on sale of securities available-for-sale	$	0.5		$	0.1		$	9.1

(1)

The 2008 amount included a net gain of $2.1 million related to the sale of securities for a nominal amount of $74 million, partially offset by a loss of $2 million resulting mainly from the sale of securities under repurchase agreements (nominal amount of $175.2 million) accounted for as sales at the transfer of those securities.

For additional information, see Item 18, “Financial Statements,” notes 65 and ~~13.~~

12.

Operating Expenses

The following table shows a breakdown of the components of the Bank’s total operating expenses for the periods indicated:

	For the Year Ended December 31,						For the Year Ended December 31,
	2008		2007		2006		2009		2008		2007
	(in $ thousand)						(in $ thousand)
Salaries and other employee expenses	$	20,227	$	22,049	$	16,826	$	20,201	$	20,227	$	22,049
Depreciation, amortization and impairment of premises and equipment.		3,720		2,555		1,406
Depreciation, amortization and impairment of premises and equipment								2,671		3,720		2,555
Professional services		3,765		3,181		2,671		3,262		3,765		3,181
Maintenance and repairs		1,357		1,188		1,000		1,125		1,357		1,188
Expenses from the investment fund		2,065		381		0		3,520		2,065		381
Other operating expenses		8,856		7,673		7,026		7,423		8,856		7,673
Total Operating Expenses	$	39,990	$	37,027	$	28,929
Total operating expenses							$	38,202	$	39,990	$	37,027

The $2 million, or 4%, decrease in operating expenses for the year ended December 31, 2009 compared to the year ended December 31, 2008 was mainly due to:

the effect of cost-cutting measures that resulted in lower overall operating expenses as average business volumes declined during 2009; and

a $1 million write-off of an information technology application in 2008.

These reductions were offset by the $1 million increase in expenses attributable to general growth and better results in the Fund, mainly related to increased performance-based expenses.

The $3 million, or 8%, increase in operating expenses in 2008 compared to 2007 was mainly due to:

a $2 million cost of general growth and structure in the investment fund;

a $1 million cost for the write-off of an information technology application;

a $1 million increase in other operating expenses; and

a $1 million increase in professional services.

Offsetting these increases was a $2 million decrease in salaries and other employee expenses mainly related to a 33% decrease in employee variable compensation.

~~The $8 million, or 28%, increase in operating expenses in 2007 compared to 2006 was mainly due to:~~

a $5 million increase in salaries and other employee expenses, mainly driven by a $3 million increase in performance-based variable compensation for the Bank’s proprietary asset management team, and the remaining $2 million mainly related to the stock compensation plan for the Bank’s senior management, a one-time event accrual of employee vacation, and an increase in performance-based variable compensation provision for business lines other than proprietary asset management;

~~a $1 million increase in maintenance and depreciation expenses related to the Bank’s new technology platform;~~

~~a $1 million increase in professional services, mainly due to legal expenses related to the Bank’s business; and~~

~~a $1 million increase in expenses related to marketing and business travel.~~

3037

Changes in Financial Condition

The following table presents components of the Bank’s balance sheet at the dates indicated:

	As of December 31,
	2009			2008			2007
	(in $ thousand)
Assets
Cash and due from banks	$	2,961		$	11,474		$	596
Interest-bearing deposits in banks		421,595			889,119			400,932
Trading assets		50,277			44,939			0
Securities available-for-sale		456,984			607,918			468,360
Securities held-to-maturity		0			28,410			0
Investment fund		197,575			150,695			81,846
Loans		2,779,262			2,618,643			3,731,838
Less:
Allowance for loan losses		(73,789	)		(54,648	)		(69,643	)
Unearned income and deferred fees		(3,989	)		(4,689	)		(5,961	)
Loans, net		2,701,484			2,559,306			3,656,234
Customers’ liabilities under acceptances		1,551			1,375			9,104
Premises and equipment, net		7,749			7,970			10,176
Accrued interest receivable		25,561			46,319			62,375
Derivative financial instruments used for hedging - receivable		828			7,777			122
Other assets		12,206			7,376			8,826
Total Assets	$	3,878,771		$	4,362,678		$	4,698,571
Liabilities and Stockholders’ Equity
Deposits	$	1,256,246		$	1,169,048		$	1,462,371
Trading liabilities		3,152			14,157			13
Securities sold under repurchase agreements		71,332			474,174			283,210
Short-term borrowings		327,800			738,747			1,221,500
Borrowings and long-term debt		1,390,387			1,204,952			1,010,316
Acceptances outstanding		1,551			1,375			9,104
Accrued interest payable		11,291			32,956			38,627
Derivative financial instruments used for hedging - payable		65,137			91,897			16,899
Reserve for losses on off-balance sheet credit risk		27,261			30,724			13,727
Other liabilities		14,077			25,635			30,553
Total Liabilities		3,168,234			3,783,665			4,086,320
Redeemable noncontrolling interest in the investment fund		34,900			4,689			0

Stockholders’ Equity
Common stock, no par value		279,980			279,980			279,980
Additional paid-in capital in excess of assigned value of common stock		134,820			135,577			135,142
Capital reserves		95,210			95,210			95,210
Retained earnings		301,389			268,435			245,348
Accumulated other comprehensive loss		(6,160	)		(72,115	)		(9,641	)
Treasury stock		(129,602	)		(132,763	)		(133,788	)
Total Stockholders’ Equity		675,637			574,324			612,251
Total Liabilities and Stockholders’ Equity	$	3,878,771		$	4,362,678		$	4,698,571

2009 vs. 2008

During 2009, total assets decreased by $484 million, mainly as a result of a $476 million decrease in interest-bearing deposit in banks, as the Bank gradually returned to historical liquidity levels as funding markets improved during the year 2009, and a $151 million decrease in the securities available-for-sale portfolio, mainly resulting from the sale of securities for a nominal amount of $137 million (or $147 million in carrying value). These decreases were partially offset by a $161 million increase in the loan portfolio due to improving market conditions in the Region in the second half of 2009. As of December 31, 2009, the loan portfolio amounted to $2,779 million, with an average maturity term of ~~each year:~~389 days, with 66% of the portfolio scheduled to mature within one year. A majority, or 59%, of the loan portfolio was trade related in nature and 41% constituted non-trade loans mainly extended to banks, sovereigns or exporting corporations. The corporate segment, which includes state-owned exporting organizations and private corporations, represented 53% of the loan portfolio, and within this corporate segment, 62% was trade related.

2008

2007

2006

(in $ thousand)
Assets
Cash and due from banks $ 11,474 $ 596 $ 401
Interest-bearing deposits in banks 889,119 400,932 303,426
Trading assets 44,939 0 0
Investment securities 636,328 468,360 471,351
Investment fund 150,695 81,846 105,199
Loans 2,618,643 3,731,838 2,980,772
Less:
Allowance for loan losses (54,648 ) (69,643 ) (51,266 )
Unearned income and deferred loan fees (4,689 ) (5,961 ) (4,425 )
Loans, net $ 2,559,306 $ 3,656,234 $ 2,925,081
Customers’ liabilities under acceptances 1,375 9,104 46,006
Premises and equipment, net 7,970 10,176 11,136
Accrued interest receivable 46,319 62,375 52,488
Derivative instruments used for hedging - receivable 7,777 122 541
Other assets 7,376 8,826 6,743
Total Assets $ 4,362,678 $ 4,698,571 $ 3,922,373
Liabilities and Stockholders’ Equity
Deposits 1,169,048 1,462,371 1,056,277
Trading liabilities 14,157 13 0
Securities sold under repurchase agreements 474,174 283,210 438,356
Short-term borrowings 738,747 1,221,500 1,157,248
Borrowings and long-term debt 1,204,952 1,010,316 558,860
Acceptances outstanding 1,375 9,104 46,006
Accrued interest payable 32,956 38,627 27,295
Derivative instruments used for hedging - payable 91,897 16,899 2,634
Reserve for losses on off-balance sheet credit risk 30,724 13,727 27,195
Other liabilities 25,635 30,553 24,606
Total Liabilities $ 3,783,665 $ 4,086,320 $ 3,338,477
Minority interest 4,689 0 0
Stockholders’ Equity
Common stock, no par value 279,980 279,980 279,980
Capital surplus 135,577 135,142 134,945
Capital reserves 95,210 95,210 95,210
Retained earnings 268,435 245,348 205,200
Accumulated other comprehensive income (loss) (72,115 ) (9,641 ) 3,328
Treasury stock (132,763 ) (133,788 ) (134,768 )
Total Stockholders’ Equity $ 574,324 $ 612,251 $ 583,896
Total Liabilities and Stockholders’ Equity $ 4,362,678 $ 4,698,571 $ 3,922,373

As of December 31, 2009, the Bank’s liquidity amounted to $402 million, compared to $826 million as of December 31, 2008 and $396 million as of December 31, 2007.

The 2009 decrease in assets was accompanied by a $615 million decrease in liabilities, especially in securities sold under repurchase agreements and short-term borrowings, offset by an increase of $185 million in borrowings and long-term debt associated with two two-year loan syndications in the second half of 2009 for a total of $213 million.

2008 vs. 2007

During 2008, total assets decreased $336 million compared to 2007, principally driven by a $1$1.1 billion decrease in the loan portfolio, as the Bank built liquidity, reduced vulnerable exposures ~~and/or~~and concentrations, and preserved its capitalization in response to deteriorating global macroeconomic conditions in the last quarter of 2008. AtAs of December 31, 2008, the loan portfolio amounted to $2,619 million, with an average maturity term of 480 days, with 61% of the portfolio scheduled to mature within one year. 61% of the loan portfolio was trade related in nature and 39% constituted non-trade loans mainly extended to banks or sovereign or exporting corporations. The corporate segment, which includes state-owned exporting organizations and private corporations, represented 62% of the loan portfolio, and of this corporate segment, 60% was trade related. ~~At December 31, 2008, the Bank’s liquidity stood at $826 million compared to $396 million at December 31, 2007.~~

The decrease in assets during 2008 was accompanied by a $303 million decrease in liabilities, principally driven by a $293 million decrease in deposits and a $483 million decrease in short-term borrowings, as a result of the global financial crisis during the last quarter of 2008. These decreases were partly offset by a $191 million increase in long-term borrowings, as the Bank finalized a $200 million five-year bilateral term loan facility with the China Development Bank at the end of the first quarter 2008, and contracted a two-year syndicated term loan facility, jointly lead-arranged by Santander Investment Securities and Standard Chartered Bank. ~~The original $150 million facility was substantially oversubscribed, closing with $245 million in total commitments among thirteen international financial institutions.~~

The $776 million increase in total assets in 2007 was mainly due to a $751 million increase in the loan portfolio, resulting from the continued execution of the Bank’s strategy of diversifying its portfolio concentration specifically by increasing its loans within the corporate segment. At December 31, 2007, the average maturity of the loan portfolio was 429 days, and 68% of the portfolio was scheduled to mature within one year. 60% of the portfolio was trade related and 40% constitutes non-trade loans mainly extended to banks or sovereign or exporting corporations. The corporate segment, which includes state-owned exporting organizations and private corporations, represented 51% of the loan portfolio in 2007, compared to 48% in 2006, and of this corporate segment, 66% and 74% was trade related in 2007 and 2006, respectively.

The increase in assets in 2007 was mainly financed by (1) a $406 million increase in deposits from central and commercial banks in the Region, and (2) a $451 million increase in medium-and long-term borrowings and debt, including a bond issuance in Peruvian Nuevo Soles, interbank borrowings in Mexican Pesos, a five-year international loan syndication for an amount of $150 million, and a three-year borrowing for an additional $75 million, among other borrowings.

Asset Quality

The Bank believes that its asset quality is a function of its strong client base, the importance that governments and borrowers alike attribute to maintaining continued access to trade financing, its preferred creditor status, and its strict adherence to commercial criteria in its credit activities.

The Bank’s ~~management~~Management and the CPER review periodically a report of all loan delinquencies. The Bank’s collection policies include rapid internal notification of any delinquency and prompt initiation of collection efforts, usually involving senior ~~management.~~Management.

Impaired Assets and Contingencies

The Bank’s ~~impaired~~ assets that are subject to impairment consist mainly of ~~impaired~~ loans and ~~impaired~~ securities. For more information on impaired loans, see Item 18, “Financial ~~Statements,” notes 2(k)~~Statements”, Notes 2(l) and 8.7. For ~~more~~ information on impaired securities, see Item 18, “Financial Statements,” notes 2(i) and 6.5.

Loans and contingencies are identified as ~~impaired~~past-due and placed on ~~non-accrual status~~a cash basis (non-accrual) when any ~~payment of~~interest or principal ~~and fees or commissions relating thereto~~ is ~~over~~past due for 90 days ~~past due~~ or more, or before if the Bank’s ~~management determines that~~Management deems the ~~item may become payable by the Bank and its~~ ultimate collection of principal or ~~commission is doubtful.~~interest to be uncertain. For more information on contingencies, see Item 18, “Financial ~~Statements,” notes 2(k)~~Statements”, note 18, and ~~19.~~see Item 5, “Operating and Financial Review and Prospects/Operating Results/Reversal (Provision) for Loan Losses.”

The following table sets forth information regarding the Bank’s impaired assets and contingencies at ~~December 31 of each year:~~

the dates indicated:

																As of December 31,
	2008			2007			2006			2005			2004			2009			2008			2007			2006			2005
	(in $ million, except percentages)															(in $ million, except percentages)
Impaired loans	$	0		$	0		$	0		$	29		$	256		$	36		$	0		$	0		$	0		$	29
Allocation from the allowance for loan losses		0			0			0			11			82			14			0			0			0			11
Impaired loans as a percentage of total loans, net of unearned income and deferred commission		0.0	%		0.0	%		0.0	%		1.1	%		10.5	%		1.3	%		0.0	%		0.0	%		0.0	%		1.1	%
Impaired contingencies	$	0		$	0		$	0		$	13		$	32		$	0		$	0		$	0		$	0		$	13
Allocation from the reserve for losses on off balance-sheet credit risks		0			0			0			9			21			0			0			0			0			9
Impaired contingencies as a percentage of total contingencies		0.0	%		0.0	%		0.0	%		1.7	%		10.5	%		0.0	%		0.0	%		0.0	%		0.0	%		1.7	%
Impaired securities (par value)	$	0		$	0		$	0		$	0		$	5		$	0		$	0		$	0		$	0		$	0
Estimated fair value adjustments on options and impaired securities1		0			0			0			0			4
Estimated fair value adjustments on options and impaired securities(1)																	0			0			0			0			0
Estimated fair value of impaired securities	$	0		$	0		$	0		$	0		$	1		$	0		$	0		$	0		$	0		$	0
Impaired securities as a percentage of total securities2		0.0	%		0.0	%		0.0	%		0.0	%		0.5	%

Impaired assets and contingencies as a percentage of total credit portfolio3		0.0	%		0.0	%		0.0	%		1.2	%		9.8	%
Impaired securities as a percentage of total securities(2)																	0.0	%		0.0	%		0.0	%		0.0	%		0.0	%
Impaired assets and contingencies as a percentage of total credit portfolio(3)																	1.0	%		0.0	%		0.0	%		0.0	%		1.2	%

1 ~~Includes impairment losses on securities, estimated unrealized gain (loss) on impaired securities, premiums and discounts.~~

2 ~~Total securities consist of investment securities considered part of the Bank’s credit portfolio.~~

(1)	Includes impairment losses on securities, estimated unrealized gain (loss) on impaired securities, premiums and discounts.

3 ~~The total credit portfolio consists of loans net of unearned income, fair value of investment securities, securities purchased under agreements to resell and contingencies.~~

~~As of December 31, 2008, 2007 and 2006 the Bank did not have any impaired credits in its portfolio nor any credits with specific reserves.~~

(2)	Total securities consist of investment securities considered part of the Bank’s credit portfolio.

(3)	The total credit portfolio consists of loans net of unearned income, fair value of investment securities, securities purchased under agreements to resell and contingencies.

Allowance for Credit Losses

The allowance for credit losses, which includes the allowance for loan losses and the reserve for losses on off-balance sheet credit risk, covers the credit risk on loans and contingencies. The allowance for credit losses includes an asset-specific component and a formula-based ~~component satisfying the requirements of FASB Statement No. 5, “Accounting for Contingencies” (“FASB Statement No. 5”).~~component. The asset-specific component relates to a provision for losses on credits considered impaired and measured on a case-by-case ~~basis pursuant to FASB Statement No. 114, “Accounting by Creditors for Impairment of a Loan” (“FASB Statement No. 114”).~~basis. For additional information regarding allowance for credit losses, see Item 18, “Financial Statements,” notes ~~2(l)~~2(n) and 9.8.

The reserve balances for estimating generic allowances, for both onon- and off-balance sheet credit exposures, are calculated applying the following formula:

Reserves = S(E x PD x LGD)

~~Reserves =~~ S~~(E x PD x LGD)~~

where:

~~where:~~

Exposure (E) = the total accounting balance ~~(on~~(on- and off-balance sheet) at the end of the period under ~~review, segregated by country.~~review.

Probabilities of Default (PD) = one-year probability of default applied to the ~~portfolio in each country.~~portfolio. Default rates are based on the Bank’s historical portfolio performance per rating category, ~~during a ten-year period,~~ complemented by Standard & Poor’s (“S&P”) probabilities of default data ~~from international credit rating agencies~~ for high risk cases, in view of the greater robustness of ~~credit rating agencies~~S&P data for such cases.

Loss Given Default (LGD) ~~= a factor of 45%~~ is ~~utilized,~~based on historical information, which is based on best practices in the banking industry. ~~This factor~~Management applies ~~to all countries, except those classified as higher risk, in which case the Bank’s management applies~~judgment and historical loss ~~experience on a case-by-case basis.~~experience. The LGD factor is reviewed quarterly.

The following table sets forth information regarding the Bank’s allowance for credit losses with respect to the total ~~credits~~commercial portfolio outstanding atas of December 31 of each year:

2008

2007

2006

2005

2004

(in $ millions, except percentages)
Components of the allowance for credit losses
Allowance for loan losses
Balance at beginning of the year $ 70 $ 51 $ 39 $ 106 $ 224
Provision (reversal) (19 ) 12 12 (54 ) (111 )
Cumulative effect on prior years (2004) of a change in credit loss reserve methodology 0 0 0 (6 ) 0
Recoveries 4 6 0 3 6
Loans charged-off 0 0 0 (9 ) (13 )
Balance at the end of the year $ 55 $ 70 $ 51 $ 39 $ 106
Reserve for losses on off-balance sheet credit risk:
Balance at beginning of the year $ 14 $ 27 $ 52 $ 33 $ 34
Provision (reversal) 17 (13 ) (25 ) 16 (1 )
Cumulative effect on prior years (2004) of a change in credit loss reserve methodology 0 0 0 3 0
Balance at end of the year $ 31 $ 14 $ 27 $ 52 $ 33
Total allowance for credit losses $ 85 $ 83 $ 78 $ 92 $ 139
Allowance for credit losses to total commercial portfolio 2.8 % 1.9 % 2.2 % 2.7 % 5.1 %

3340

The allowance for credit losses amounted to $85 million at December 31, 2008. The ratio of the allowance for credit losses to the commercial portfolio as of December 31, 2008 was 2.8% compared to 1.9% as of December 31, 2007. The increase in the allowance for credit losses to the commercial portfolio reflects the impact of increasing risk levels in the Region on the Bank’s reserve model.

	As of December 31,
	2009			2008			2007			2006			2005
	(in $ million, except percentages)
Components of the allowance for credit losses
Allowance for loan losses
Balance at beginning of the year	$	55		$	70		$	51		$	39		$	106
Provision (reversal)		18			(19	)		12			12			(54	)
Cumulative effect on prior years (2004) of a change in credit loss reserve methodology		0			0			0			0			(6	)
Recoveries		1			4			6			0			3
Loans charged-off		(0	)		0			0			0			(9	)
Balance at the end of the year		74			55			70			51			39
Reserve for losses on off-balance sheet credit risk:
Balance at beginning of the year		31			14			27			52			33
Provision (reversal)		(3	)		17			(13	)		(25	)		16
Cumulative effect on prior years (2004) of a change in credit loss reserve methodology		0			0			0			0			3
Balance at end of the year		27			31			14			27			52
Total allowance for credit losses	$	101		$	85		$	83		$	78		$	92
Allowance for credit losses to total commercial portfolio		3.2	%		2.8	%		1.9	%		2.2	%		2.7	%
Net charge offs to average loans outstanding		0.0	%		0.0	%		0.0	%		0.0	%		0.4	%

The following table sets forth information regarding the Bank’s allowance for credit losses allocated by country of exposure atas of December 31 of each year:

	2008				2007				2006					As of December 31,
	Total		%		Total		%		Total		%			2009				2008				2007
	(in $ million, except percentages)													Total		%		Total		%		Total		%
														(in $ million, except percentages)
Allowance for loan losses													Allowance for loan losses
Argentina	$	25		29.7	$	32		38.4	$	25		32.4		$	14		18.4	$	25		46.3	$	32		45.3
Brazil		5		6.2		11		13.2		11		14.3			17		23.5		5		8.8		9		13.6
Chile															2		2.2		0		0.1		0		0.0
Colombia		2		2.7		2		2.7		2		2.2			3		4.0		2		4.2		2		3.2
Costa Rica															4		4.8		0		0.6		0		0.5
Dominican Republic		0		0.3		0		0.3		3		3.3			2		2.7		0		0.4		0		0.1
Ecuador		37		43.8		17		20.2		30		38.3			4		5.1		11		20.3		7		10.3
El Salvador															2		2.3		1		1.1		0		0.1
Guatemala															1		1.9		1		0.9		0		0.4
Honduras															1		2.0		3		5.3		0		0.3
Jamaica		1		1.1		4		5.0		2		3.1			2		2.6		1		1.7		4		5.1
Mexico		4		4.3		3		3.5		1		1.6			19		25.1		4		6.8		3		4.1
Nicaragua		1		0.8		1		1.7		0		0.6
Peru		0		0.1		2		2.9		1		0.8			2		2.5		0		0.2		2		3.4
Uruguay															1		1.7		0		0.9		0		0.0
Venezuela		4		4.2		7		8.3		0		0.1			0		0.0		0		0.0		6		8.9
Other1		6		6.8		3		3.7		3		3.4
Total Allowance for Credit Losses	$	85		100.0	$	83		100.0	$	78		100.0
Other															1		1.1		1		2.5		3		4.5
Total Allowance for loan losses														$	74		100.0	$	55		100.0	$	70		100.0

Reserve for losses on off-balance sheet credit risk													Reserve for losses on off-balance sheet credit risk
Brazil														$	0		0.3	$	1		1.8	$	2		11.0
Chile															0		0.0		0		0.1		0		0.0
Colombia															0		0.0		0		0.0		0		0.1
Costa Rica															1		3.8		0		0.3		0		1.6
Dominican Republic															0		0.3		0		0.2		0		1.4

	As of December 31,
	2009				2008				2007
	Total		%		Total		%		Total		%
	(in $ million, except percentages)
Ecuador		21		75.8		26		85.5		10		70.3
El Salvador		0		0.3		0		0.0		0		0.0
Guatemala		0		0.1		0		0.0		0		0.0
Honduras		0		0.1		0		0.1		0		0.0
Jamaica		0		0.0		0		0.0		1		4.7
Mexico		0		1.6		0		0.1		0		0.6
Uruguay		1		2.4		0		0.0		0		0.0
Venezuela		4		15.3		4		11.6		1		5.4
Other		0		0.0		0		0.4		0		1.4
Total Reserve for losses on off-balance sheet credit risk	$	27		100.0	$	31		100.0	$	14		100.0

Allowance for credit losses
Argentina	$	14		13.4	$	25		29.7	$	32		38.4
Brazil		17		17.3		5		6.2		11		13.2
Chile		2		1.6		0		0.1		0		0.0
Colombia		3		2.9		2		2.7		2		2.7
Costa Rica		5		4.5		0		0.5		1		0.7
Dominican Republic		2		2.1		0		0.3		0		0.3
Ecuador		24		24.2		37		43.8		17		20.2
El Salvador		2		1.8		1		0.7		0		0.1
Guatemala		1		1.4		1		0.6		0		0.4
Honduras		2		1.5		3		3.4		0		0.2
Jamaica		2		1.9		1		1.1		4		5.0
Mexico		19		18.8		4		4.3		3		3.5
Peru		2		1.8		0		0.1		2		2.9
Uruguay		2		1.9		0		0.5		0		0.0
Venezuela		4		4.1		4		4.2		7		8.3
Other (1)		1		0.8		1		1.7		3		4.0
Total Allowance for credit losses	$	101		100.0	$	85		100.0	$	83		100.0

1(1)	Other consists of allowance for credit losses allocated to countries in which allowance for credit losses outstanding did not exceed $1 million as of December 31, ~~2008.~~ 2009.

The following table sets forth information regarding the Bank’s allowance for credit losses by type of borrower atas of December 31 of each year:

	2008		2007		2006		As of December 31,
	(in $ million)						2009				2008				2007
Private sector commercial banks	$	11	$	22	$	15
							Total		%		Total		%		Total		%
							(in $ million, except percentages)
Private sector commercial banks and Financial Institutions							$	14		13.7	$	11		12.3	$	22		26.4
State-owned commercial banks		3		2		5		10		10.0		3		3.7		2		2.7
Central banks		27		9		21		20		20.3		27		32.0		9		10.4
Sovereign debt		1		1		1		1		1.1		1		0.8		1		1.1
State-owned exporting organization		1		10		2		5		5.0		1		1.0		10		12.3
Private corporations		43		39		35		50		49.9		43		50.1		39		47.2
Total	$	85	$	83	$	79	$	101		100.0	$	85		100.0	$	83		100.0

	As of December 31,
	2009			2008			2007
	(in $ thousand)
Common stock	$	279,980		$	279,980		$	279,980
Additional paid-in capital in excess of assigned value of common stock		134,820			135,577			135,142
Capital reserves		95,210			95,210			95,210
Retained earnings		301,389			268,435			245,348
Accumulated other comprehensive loss		(6,160	)		(72,115	)		(9,641	)
Treasury stock		(129,602	)		(132,763	)		(133,788	)
Total stockholders’ equity	$	675,637		$	574,324		$	612,251

At December 31,

2008

2007
��
2006

(in $ thousand)
Common stock $ 279,980 $ 279,980 $ 279,980
Capital surplus 135,577 135,142 134,945
Capital reserves 95,210 95,210 95,210
Retained earnings 268,435 245,348 205,200
Accumulated other comprehensive income (loss) (72,115 ) (9,641 ) 3,328
Treasury stock (132,763 ) (133,788 ) (134,768 )
Total stockholders’ equity $ 574,324 $ 612,251 $ 583,896

The $101 million increase in stockholders’ equity during 2009 was mainly the net result of:

Reduction of accumulated other comprehensive loss by $66 million, mostly related to net unrealized gains from the investment securities portfolio (available-for-sale) due to mark-to-market adjustments; and

Increased retained earnings due to net income attributable to Bladex of $55 million, partially offset by $22 million declared and paid in cash dividends.

The $38 million decrease in stockholder’s equity during 2008 was mainly the net result of:

Deterioration in accumulated other comprehensive ~~income~~loss by $62 million, mostly related to net unrealized losses from the investment securities portfolio due to ~~mark-to-market; and~~mark-to-market adjustments; offset by

Increased retained earnings due to ~~the Bank’s~~ net income attributable to Bladex of $55 million, partially offset by a total of $32 million in dividends ~~paid to common stockholders.~~declared and paid.

~~The $28 million increase in stockholders’ equity during 2007 was the net result of:~~

~~Increased retained earnings due to the Bank’s net income of $72 million, partially offset by a total of $32 million in dividends paid to common stockholders; and~~

Decreased accumulated other comprehensive income related to derivative hedging instruments, due to the lowering of interest rates by the U.S. Federal Reserve Board in response to the global financial crisis. This decrease was not offset by the investment securities portfolio, which is covered by interest rate swaps, due to an increase in credit spreads as a result of the liquidity shortgage in the market.

Capital reserves are established by the Bank from retained ~~earnings and are a form of retained earnings required by Panamanian banking regulations.~~earnings. Capital reserves are intended to strengthen the Bank’s capital position. Reductions of these reserves, ~~including~~ for purposes such as the payment of dividends, require the approval of the Board and Panamanian banking authorities. Panamanian banking regulations do not require the Bank to maintain any particular level of capital reserves.

AtAs of December 31, ~~2008,~~2009, the capital ratio of total stockholders’ equity to total assets was 13.16%. Although the Bank is not subject to the capital adequacy requirements of the U.S. Federal Reserve Board, if the U.S. Federal Reserve Board’s risk-based capital guidelines applied to the Bank, the Bank's ratios would have exceeded all applicable capital adequacy requirements. At December 31, 2008,17.4% and the Bank’s Tier 1 and total capital ratios calculated according to ~~these~~Basel I capital adequacy guidelines were ~~20.4%~~25.8% and ~~21.6%~~27.0%, respectively. The Banking Law (as defined under Item 4, “Information on the Company/Business Overview/Regulation”), which became effective on August 25, 2008, requires the Bank to maintain a minimum total capital to risk-weighted asset ratio of 8%. AtAs of December 31, ~~2008,~~2009, the Bank’s total capital to risk-weighted asset ratio, calculated according to the guidelines of the Banking Law, was ~~19%~~22.3%. See Item 4, “Information on the ~~Company/~~Company / Business ~~Overview/Regulation/Panamanian Law.~~Overview / Regulation.”

C.	Research and Development, Patents and Licenses, etc.

Not applicable.

~~C. Research and Development, Patents and Licenses, etc.~~

~~Not applicable.~~

D.	Trend Information

The following are the most important trends, uncertainties and events that are likely to materially affect the Bank or that would cause the financial information disclosed herein to not to be indicative of the Bank’s future operating results or financial condition:

The effect of changes in global economic conditions, including prices of oil and other commodities, ~~prices,~~ the U.S. dollar exchange rate, interest rates, and slower economic growth in developed countries and trading partners, and the effect that these changes may have on the economic condition of countries in the Region, including the Region’s foreign trade growth, and, therefore, onthe growth of the Bank’s ~~capacity to grow its~~ trade financing ~~business.~~business;

The effect that an economic slowdown or political events in the Region may have on the Bank’s asset quality, results of operations and growth ~~prospects.~~prospects;

Risk perception in the ~~Bank’s~~ markets in which the Bank operates, increased competition, and U.S. dollar liquidity, which could affect spreads over the cost of funds on the Bank’s loan portfolio, and in turn impact the Bank’s net interest ~~spreads.~~spreads; and

A continued downturn in the capital markets, or a continued downturn in investor confidence, which could affect the Bank’s access to funding or increase its cost of funding.

Specific trends that affected the Bank’s performance during 2009 included the pronounced decrease in market rates such as 6M LIBOR which saw a decrease from an average 306 bps in 2008 to an average of 112 bps in 2009, leading to a compression of lending spreads. An increase in funding margins from an average of 35 bps in 2008 to an average of 70 bps in 2009 as liquidity and access to capital markets became limited due to the repercussions of the financial crisis, also affected the Bank´s lending spreads, particularly during the first half of 2009. During this period, the Bank maintained higher than normal levels of liquidity with adverse effect on margins. These effects were partially offset by an increase in lending margins from an average of 168 bps in 2008 to an average of 262 bps in 2009, as the Bank was able to pass on higher funding costs. The Bank also benefited from an improvement in market valuations in 2009 compared to the previous year which impacted favorably the results of the Bank’s Asset Management and Treasury Divisions. The Bank’s efficiency ratio improved from 42% in 2008 to 35% in 2009, mainly as the result of prudent cost management.

In addition, see Item 3, “Key Information/Risk Factors,” for a discussion of the risks the Bank faces, which could affect the Bank’s business, results of operations and/or financial condition.

E.	Off-Balance Sheet Arrangements

In the ordinary course of business, in order to meet the financing needs of its customers, the Bank enters into arrangements that are not recognized on its balance sheet. AtAs of December 31, ~~2008,~~2009, the Bank’s off-balance sheet arrangements included stand-by letters of credit, guarantees (commercial risk and country risk), credit derivatives and credit commitments (including unused commitments and other commitments). These arrangements are kept off-balance sheet as long as the Bank does not incur an obligation relating to them or itself become entitled to an asset. ASuch off-balance sheet arrangements are exposed to credit risk. Therefore, a reserve for losses on off-balance sheet credit risk is recognized on the balance sheet, with the resulting ~~loss~~provision recorded in the income statement. As of December 31, 2009, total reserves for losses on off-balance sheet amounted to $27 million, compared to $31 million as of December 31, 2008. See Item 18, “Financial Statements,” note ~~19.~~8 and 18.

~~Fees~~For the year ended December 31, 2009, fees and ~~commissions~~commission income from off-balance sheet arrangements amounted to $7 ~~million in 2008, compared to $6 million in 2007.~~million. For additional information, see ~~Item~~“Item 5, “Operating and Financial Review and Prospects/Operating Results/Fees and Commissions, ~~Net.~~net.” In 2008, the Bank was committed to invest $1.4 million in 2008, compared to $1.5 million in 2007, in a private investment fund with the main objective of generating long-term capital appreciation through the purchase of shares and convertible debt, mainly from Mexican manufacturing corporations or foreign corporations trying to establish or expand their operations in Mexico. See Item 18, “Financial Statements,” note 11.

No obligations have arisen from variable interest entities as defined in ~~Financial Interpretation (“FIN”) 46R, “Consolidation of Variable Interest Entities - Reviewed,”~~U.S. GAAP, including indemnification agreements with the Bank’s executive officers and directors. The Bank provides indemnity insurance pursuant to which directors and officers are indemnified or insured against liability or loss under certain circumstances, including liabilities or related losses arising under the Securities Act and the Exchange Act.

~~F. Contractual Obligations and Commercial Commitments~~

F.	Contractual Obligations and Commercial Commitments

The following tables set forth information regarding the Bank’s contractual obligations and commercial commitments as of December 31, ~~2008:~~2009.

	Payments Due by Period
Contractual Obligations	Total		Less than 1 year		1 – 3 years		3 – 5 years		More than 5 years
	(in $ million)
Deposits	$	1,256	$	1,256	$	0	$	0	$	0
Trading liabilities		3		0		3		0		0
Securities sold under repurchase agreement		71		71		0		0		0
Short-term borrowings		328		328		0		0		0
Borrowings and long-term debt (1)		1,390		529		819		43		0
Accrued interest payable		11		11		0		0		0
Lease obligations		2		1		1		0		0
Total contractual obligations	$	3,062	$	2,196	$	823	$	43	$	0

Payments Due by Period
Contractual Obligations
Total

Less than 1 year

1 – 3 years

3 – 5 years

More than 5 years

(in $ million)
Deposits $ 1,169 $ 1,169 $ 0 $ 0 $ 0
Trading liabilities 14 14 0 0 0
Securities sold under repurchase agreement 474 474 0 0 0
Short-term borrowings 739 739 0 0 0
Borrowings and long-term debt 1
1,205 210 498 458 39
Accrued interest payable 33 33 0 0 0
Commitment to repurchase securities sold under repurchase agreements 138 138 0 0 0
Lease obligations 3 1 1 1 0
Total contractual obligations $ 3,775 $ 2,778 $ 499 $ 458 $ 39

Amount of Commitment Expiration by Period
Other Commercial Commitments
Total

Less than 1 year

1 – 3 years

3 – 5 years

More than 5 years
(in $ million)
Letters of credit $ 137 $ 137 $ 0 $ 0 $ 0
Stand-by letters of credit 41 41 0 0 0
Guarantees 179 144 35 0 0
Credit derivative 3 0 3 0 0
Other commercial commitments 84 81 2 0 1
Total Commercial Commitments $ 444 $ 403 $ 39 $ 0 $ 1

	Amount of Commitment Expiration by Period
Other Commercial Commitments	Total		Less than 1 year		1 – 3 years		3 – 5 years		More than 5 years
	(in $ million)
Letters of credit	$	207	$	202	$	5	$	0	$	0
Stand-by letters of credit		36		36		0		0		0
Guarantees		15		15		0		0		0
Credit derivative		3		3		0		0		0
Other commercial commitments		70		68		1		0		1
Total Commercial Commitments	$	331	$	324	$	6	$	0	$	1

1(1) Certain debt obligations are subject to covenants that could accelerate the payment of these obligations.

Item 6. Directors, Executive Officers and Employees

A. Directors and Executive Officers

Directors

The following table sets forth certain information concerning the ~~directors~~Directors of the Bank as of the date of this ~~Annual Report:~~annual report.

Name

Position Held
with
The Bank

Country of
Citizenship

Year
Term Expires

Director
Since

Age
CLASS A
José Maria Rabelo
Brazil
Director Brazil 2010 2007 53
Guillermo Güémez García
Deputy Governor
Banco de Mexico, Mexico
Director Mexico 2011 1997 68
Roberto Feletti
Vice President
Banco de la Nación Argentina, Argentina
Director Argentina 2011 2008 50
CLASS E
Mario Covo
Chief Executive Officer
Finaccess International, Inc., U.S.A.
Director U.S.A 2011 1999 51
Maria da Graça França
Brazil
Director Brazil 2010 2004 60
Herminio Blanco
Chief Executive Officer
Soluciones Estratégicas Consultoría, Mexico
Director Mexico 2010 2004 58
William D. Hayes
President
Wellstone Global Finance, LLC, U.S.A.
Director U.S.A. 2010 2004 65
Will C. Wood
Principal
Kentwood Associates, U.S.A.
Director U.S.A. 2012 1999 69
ALL CLASSES OF COMMON STOCK
Gonzalo Menéndez Duque
Director
Banco de Chile, Chile
Chairman of the Board of Directors Chile 2012 1990 60
Jaime Rivera
Chief Executive Officer
Bladex, Panama
Director Guatemala 2012 2004 56

Name

Country of

Citizenship

Position Held with

The Bank

Year Term

Expires

Director

Since

Age

CLASS A

João Carlos Nobrega Pecego

Regional General Manager – Head of Latin America

Banco do Brasil, Argentina

Brazil

Director

2013

2010

Guillermo Güémez García

Deputy Governor

Banco de Mexico, Mexico

Mexico

Director

2011

1997

Esteban Alejandro Acerbo

Director

Banco de la Nación Argentina, Argentina

Argentina

Director

2011

2010

CLASS E

Mario Covo

Chief Executive Officer

Finaccess International, Inc., U.S.A.

U.S.A.

Director

2011

1999

Will C. Wood

Principal

Kentwood Associates, U.S.A.

U.S.A.

Director

2012

1999

Herminio Blanco

Chief Executive Officer

Soluciones Estratégicas Consultoría, Mexico

Mexico

Director

2013

2004

William D. Hayes

President

Wellstone Global Finance, LLC, U.S.A.

U.S.A.

Director

2013

2004

Maria da Graça França

Brazil

Director

2013

2004

ALL CLASSES OF COMMON STOCK

Gonzalo Menéndez Duque

Chairman of the

Director

Board of

Banco de Chile, Chile

Chile

Directors

2012

1990

Jaime Rivera

Chief Executive Officer

Bladex, Panama

Guatemala

Director

2012

2004

João Carlos Nobrega Pecego has served as Regional General Manager – Head of Latin America of Banco do Brasil based in Argentina since 2009. He has been employed by Banco do Brasil in various capacities since 1978, holding the positions of Executive Regional Manager of the South Region of Brazil (Rio Grande do Sul, Santa Catarina and Parana) from 2006 to 2009, Executive Manager responsible for Corporate and Project Finance from 2003 to 2006, Executive Manager of the Corporate Area of Banco do Brasil in Sao Paulo from 2000 to 2003, Regional Superintendent of the Sao Paulo Unit from 1995 to 2000, General Manager of the main agencies of Banco do Brasil in Sao Paulo from 1990 to 1995 and in various other positions at Banco do Brasil from 1978 to 1990.

Guillermo Güémez García has served as Deputy Governor of Banco de Mexico since 1995 and served as a Board Member of the National Insurance Commission and Casa de Moneda de Mexico since 1995. He served as President of the Executive Committee of Grupo Azucarero Mexico and Vice Chairman of Grupo de Embotelladoras Unidas, S.A. de C.V. from 1993 to 1994. Mr. Güémez served as Co-Chairman of the North American Committee, Board Member of Home Mart, S.A. de C.V. and Vice Chairman of the Board of Grupo Embotelladoras Unidas, S.A. de C.V. from 1986 to 1994. He served on the Mexican Business Coordinating Council for the North American Free Trade Agreement (“NAFTA”) in the capacity of Executive Director from 1991 to 1993. He was employed by Banco Nacional de Mexico (Banamex) in various capacities from 1974 to 1991, including Manager for Foreign Currency Funding and International Credits from 1974 to 1978, Representative in London from 1979 to 1981, Executive Vice President of International Treasury and Foreign Exchange, Exchange Controls and Ficorca from 1982 to 1986, and Executive Vice President for International Products from 1986 to 1990. Mr. Güémez founded and was President of Euromex Casa de Cambio and Euroamerican Capital Corporation from 1986 to 1990. He also has served as a Board Member of the Institute of International Finance and as a Board Member and Chairman of the Executive Committee of International Mexican Bank Ltd. Prior to that Mr. Güémez was employed by Bank of America Corporation in Mexico as Assistant Representative.

4657

~~José Maria Rabelo~~ served as Vice President of International and Wholesale Business of Banco do Brasil, from July 2005 to May 2009. He was employed by Banco do Brasil in various capacities since 1975, holding the positions of Director of Foreign Trade from 2004 to 2005, General Manager of the Operational Assets Restructuring Unit from 2003 to 2004, Executive Superintendent of the Credit Unit from 1999 to 2000, Executive Superintendent of the Sao Paulo Business Unit from 1998 to 1999, Executive Manager of the Credit Function Unit in 1997, Executive Manager of the Distribution Unit from 1996 to 1997, and Superintendent of the Rio Grande do Norte State Unit in 1996. Mr. Rabelo was Commercial Director of Aliança do Brasil Insurance Company from 2000 to 2002 and has been, since 2008, the President of the Deliberative Council of PREVI, the pension fund of the employees of Banco do Brasil S.A.

~~Roberto José Feletti~~Esteban Alejandro Acerbo has served as ~~Vice President~~Director of Banco de la Nación Argentina since 2006 and President of Nación ~~Fideicomisos~~Leasing since ~~March 2008, Member~~2006. Mr. Acerbo is President of the Administrative Council of Economic and Finance Center Foundation for Argentina’s Development since April 2007 and Technical Representative for the Third Meeting of the Strategic Commission of Reflection on South American Integration Process held in September and October 2006 and March 2007. He also served as Secretary of Infrastructure and Planning of the City of Buenos Aires, Argentina from 2003 to 2006, President from 2001 to 2003 and Director from 1998 to 2000, bothfollowing Commissions of Banco de la ~~Ciudad de Buenos Aires, Argentina, Chairman~~Nación Argentina: Commercial and Individual Banking since 2010 and from 2006 until 2008, Risk and Collection from 2008 to 2010 and Planning and Control from 2009 until 2010. He also has served as Vice President of the ~~Board from 2001 to 2002~~International Relations and ~~Director from 2002 to 2003, both for Red Link,~~Foreign Trade Commission of Banco de la Nación Argentina since 2008 and ~~Coordinator~~was Vice President of the ~~Economic Studies Area~~Finance and Credit Policy Commission from 2006 to 2008. Mr. Acerbo was an Associate of the ~~Institute~~Treasury Division of ~~Studies on State~~the Ministry of Economy of Argentina in 2005, Advisor and ~~Participation~~associate in accounting, taxes and finance to the Chamber of ~~State Workers’ Association in Argentina~~Commerce, Industry and Production from 1991 to 1997. Mr. Feletti also was employed in various capacities by Banco Central de la Republica Argentina from 1981 to 1991, and served as fiscal audit assistant of General Tax Administration from 1980 to 1981 and cost analyst from 1978 to 1979, both for La Vascongada in Argentina.

~~Mario Covo~~ is a founding partner of Finaccess International, Inc. and has been Managing Partner of Helios Advisors in New York since 2000. He also is one of the founders of Columbus Advisors, where he worked from 1995 to 1999. Mr. Covo was previously employed at Merrill Lynch, where he was Head of Emerging Markets-Capital Markets from 1989 to 1995. Prior to working at Merrill Lynch, he was employed by Bankers Trust Company of New York as Vice President in the Latin American Merchant Banking Group from 1985 to 1989, focusing on corporate finance and debt-for-equity swaps.2001. Prior to that, Mr. ~~Covo~~Acerbo was ~~employed as an International Economist~~Principal of Estudio Acerbo y Asociados from 1989 to 2005, Principal of the Development Commission of the Production Office of the Daireaux Municipality, Argentina from 2001 to 2004 and Associate in tax policy for ~~Chase Econometrics~~the creation of industrial parks in different districts of the Buenos Aires Province in Argentina from ~~1984~~1999 to ~~1985, focusing primarily on Venezuela and Colombia.~~2001.

Will C. Wood has served as the founding principal of Kentwood Associates of Menlo Park, California since 1993. He is a trustee of Dodge & Cox mutual funds. He was employed by Wells Fargo in the International Banking Group and served as an Executive Vice President from 1986 to 1989. While at Wells Fargo, Mr. Wood was also ~~was~~ a Director of the Bankers’ Association for Foreign Trade and PEFCO, a privately owned export finance company. He was employed by Crocker Bank and served as Executive Vice President in charge of the International Division and Manager of the Latin America Area from 1975 to 1986. Mr. Wood previously worked for Citibank in La Paz, Bolivia, Lima, Peru and Rio de Janeiro and Sao Paulo, Brazil, and began his career with Citibank’s Overseas Division in New York in 1964.

Mario Covo has served as a Director of Bladex Asset Management since 2008. Dr. Covo is the Managing Partner of Helios Advisors in New York. He was a founding partner of Finaccess International, Inc. in 2000 and of Columbus Advisors in 1995. Dr. Covo worked at Merrill Lynch from 1989 to 1995, where he was Head of Emerging Markets-Capital Markets. Prior to working for Merrill Lynch, Dr. Covo worked at Bankers Trust Company of New York from 1985 to 1989 as Vice President in the Latin American Merchant Banking Group, focusing on corporate finance and debt-for-equity swaps. Prior to that Dr. Covo was an International Economist for Chase Econometrics from 1984 to 1985, focusing primarily on Venezuela and Colombia.

Herminio A. Blanco is the founder and since 2002 has served as Chief Executive Officer of Soluciones Estratégicas Consultoría, Mexico City, and is a founding partner and since 2005 has served as Chairman of IQOM. He has been a member of the Advisory Board of SSA Mexico since 2008. Mr. Blanco has served as a board member of Banco Mercantil del Norte-Banorte and CYDSA since 2006, the United States Chamber of Commerce Foundation since 2005 and Arcelor Mittal Steel USU.S. since 2004. He has been a member of the International Advisory Committee of Mitsubishi Corporation and the Trilateral Commission since 2000. He was a senior member of the economic cabinet for President Ernesto Zedillo and the Secretary of Trade and Industry of Mexico from 1994 to 2000. He was Undersecretary for International Trade and Negotiations of the Ministry of Trade and Industry of Mexico from 1993 to 1994 and from 1988 to 1990, and was Mexico’s Chief Negotiator of ~~the North American Free Trade Agreement (NAFTA)~~NAFTA from 1990 to 1993. Mr. Blanco was one of the three members of the Council of Economic Advisors to the President of Mexico from 1985 to 1988. He was responsible for the negotiation of the Mexico-European Union free trade agreement and various other free trade agreements with Latin American countries and with Israel. Mr. Blanco also contributed to the launching of negotiations for a free trade agreement with Japan. He was Assistant Professor of Economics at Rice University, Houston, Texas from 1980 to 1985. Mr. Blanco was senior advisor to the Finance Minister of Mexico from 1978 to 1980.

William Dick Hayes has served as a Director of Bladex Asset Management since 2008. Mr. Hayes has served as President of Whaleco, Inc., New York, President of Wellstone Global Finance, LLC, San Francisco, California and Connecticut, and ~~Managing Director~~Chairman and charter member of the Board of Directors and the Investment Committee of ~~WestLB-Tricon~~Tricon Forfaiting Fund Limited, ~~Bermudas~~Bermuda since 1999. He served as Managing Director-Emerging Markets and in various other capacities for West Merchant Bank and Chartered WestLB from 1987 to 1999. Mr. Hayes served as Senior Vice President- Trading for Libra Bank Limited, New York Agency from 1986 to 1987, Principal of W.D. Hayes and Associates, California from 1984 to 1986, and in various capacities for Wells Fargo Bank, N.A., San Francisco, California from 1969 to 1984.

Maria da Graça França served as Director of Internal Control of Banco do Brasil from 2006 to 2007. She also ~~was employed by Banco do Brasil~~served in various other capacities ~~since~~during her tenure with Banco do Brasil, starting in 1971, including Head of North America and General Manager of Banco do Brasil, New York Branch from 2004 to 2005, Executive General Manager of the International Division in Brasilia, Brazil from 2002 to 2003, Regional Manager for the operations of the Bank in South America based in Argentina in 2002, General Manager of Banco do Brasil, Paris Branch from 1999 to 2002, Deputy General Manager of Banco do Brasil, Miami Branch from 1993 to 1999, General Manager of the department responsible for Banco do Brasil’s foreign network from 1992 to 1993, Deputy General Manager for foreign exchange from 1989 to 1992, Assistant Manager within the Risk Management Area from 1988 to 1989, Assistant Manager for foreign exchange internal controls from 1984 to 1987 and employee in the Foreign Exchange Department from 1971 to 1984.

Gonzalo Menéndez Duque is a senior director of the Luksic companies in Chile and serves as Director of the following Luksic group holding companies: Banco de Chile since 2001, Holdings Quiñenco since 1996, and Antofagasta PLC since 1985. In addition, he ~~serves~~has served as President of ~~the following Luksic group companies: Banchile Corredores de Bolsa, S.A. since 2007 and~~ Inversiones Vita since ~~2000.~~2000, a Luksic group company. He also ~~has served~~serves as Vice Chairman of Fundación Andrónico Luksic A. and Fundación Pascual Baburizza since 2005. Previously, Mr. Menéndez Duque served as Director and President of several companies related to Grupo Luksic since 1985, including the following: Banco de A. Edwards and related companies, Banco Santiago, Empresas Lucchetti, S.A., Banco O’Higgins, Antofagasta Group, and Banchile Administradora General de Fondos.

Jaime Rivera has served as a director of the Bank since 2004, when he was appointed Chief Executive Officer. He joined the Bank in 2002 as Chief Operating Officer. Previously, Mr. Rivera served in various capacities for Bank of America Corporation ~~beginning~~including positions in ~~1978, including~~the United States as Managing Director of the Latin America Financial Institutions Group ~~in Miami~~ and the Latin America Corporate Finance team ~~in New York,~~and on-site as General Manager in Brazil, Argentina, Uruguay and Guatemala, as Marketing Manager in Chile, and in Venezuela as Manager of Latin America Information ~~Systems in Venezuela.~~Systems. He has held ~~board~~Board positions with the Council of the Americas, the Florida International Bankers’ Association, and the Latin American Agribusiness Development Corporation. Mr. Rivera is a member of the International Advisory Committee (IAC) to the Board of Directors of the New York Stock Exchange ~~(the “NYSE”).~~Euronext. He has an MBA degree from Cornell University, a Master of Science degree from Northwestern University, and a Bachelor of Science degree from Northrop University.

Executive Officers

The following table and information sets forth the names of the executive officers of ~~the Bank and~~Bladex, their respective positions ~~as of~~at the date ~~of this Annual Report~~hereof and positions held by them with the Bank and other entities in prior years:

Name	Position Held with The Bank	Country of Citizenship	Age
Jaime Rivera	Chief Executive Officer	Guatemala	5657
Rubens V. Amaral Jr.	Executive Vice President - Chief Commercial Officer	Brazil	5051
Gregory D. Testerman	Executive Vice President - Senior Managing Director, Treasury & Capital Markets	U.S.A.	4647
Miguel Moreno	Executive Vice President, Chief Operating Officer	Colombia	5657
Miguel A. Kerbes	Senior Vice President, Chief Risk Officer	Uruguay	4950
~~Bismark E. Rodriguez~~	~~Senior Vice President, Controller~~	~~Venezuela~~	41
~~Jaime Celorio~~Christopher Schech	Senior Vice President, Chief Financial Officer	~~Mexico~~Germany	3745
~~Ana Maria de Arias~~Gustavo Díaz	Senior Vice President, ~~Organizational Performance and Development~~Controller	~~Panama~~Colombia	4547
Manuel Mejía-Aoun	~~Head of~~Chief Investment Officer Bladex Asset Management ~~(Bladex Asset Management)~~	Panama	5051

~~Jaime Rivera~~ ~~has served as~~

Presented below is a ~~director~~brief biographical description of the Bank since 2004, when he was appointed Chief Executive Officer. He joined the Bank in 2002 as Chief Operating Officer. Previously, Mr. Rivera served in various capacities for Bank of America Corporation beginning in 1978, including Managing Director of the Latin America Financial Institutions Group in Miami and the Latin America Corporate Finance team in New York, as General Manager in Brazil, Argentina, Uruguay and Guatemala, as Marketing Manager in Chile, and as Manager of Latin America Information Systems in Venezuela. He has held board positions with the Council of the Americas, the Florida International Bankers’ Association, and the Latin American Agribusiness Development Corporation. Mr. Riveraeach executive officer that is not a member of the ~~International Advisory Committee (IAC) to the~~Bank’s Board of ~~Directors of the NYSE. He has an MBA degree from Cornell University, a Master of Science degree from Northwestern University, and a Bachelor of Science degree from Northrop University.~~Directors:

Rubens V. Amaral Jr. has served as Executive Vice President, Chief Commercial Officer of the Bank since March 2004. He previously served as General Manager and Managing Director for North America of Banco do Brasil, New York Branch, since 2000. Mr. Amaral served in various capacities with Banco do Brasil since 1975, holding the positions of Managing Director of the International Division and alternate member of the board of directors in 1998, Executive General Manager of the International Division in Sao Paulo from 1998 to 2000, Deputy General Manager in the New York Branch in charge of the Trade Finance and Correspondent Banking Department from 1994 to 1998, Head of Staff of the International Division from 1993 to 1994 and Advisor, Head of Department and General Manager in the Trade Finance Area at the International Department Division – Head Office from 1989 to 1993. Mr. Amaral also served as a representative in banking supervision for the Central Bank of Brazil from 1982 to 1988.

Gregory D. Testerman has served as Executive Vice President, Senior Managing Director, Treasury & Capital Markets of the Bank since 2007. Mr. Testerman has served as a Director of Bladex Asset Management since 2006. Mr. Testerman previously served as Senior Vice President and Treasurer of the Bank from 2005 to 2006. Mr. Testerman served in various capacities with Banco Santander Central Hispano, S.A. from 1986 to 2003, including General Manager, Miami Agency, from 1999 to 2003, General Manager, Tokyo Branch and Country Manager in Japan from 1995 to 1999, Vice President, Head of Financial Control, Benelux and Asia Pacific, from 1991 to 1995, Second Vice President, Special Credit Valuation Assignment, London Branch, in 1991, Second Vice President, Treasury Operations Manager, Belgium, from 1989 to 1991, and Second Vice President, Management Reporting, Belgium, from 1986 to 1989. Mr. Testerman began his career with The Chase Manhattan Bank, N.A. as Assistant Treasurer in Belgium in 1986, and ~~previously~~ participated in the Corporate Controllers Development Program in New York from 1984 to 1986.

Miguel Moreno has served as Executive Vice President, Chief Operating Officer since July 2007. He previously served as Senior Vice President and Controller of the Bank since September 2001. He was a Management Consulting Partner for PricewaterhouseCoopers LLP, Bogotá, Colombia from 1988 to 2001, and served as Vice President of Information Technology and Operations for Banco de Crédito, Bogotá, Colombia from 1987 to 1988. Mr. Moreno served as Chief Executive Officer of TM Ingeniería, Bogotá, Colombia, from 1983 to 1987, and as Head of ~~the~~ Industrial Engineering Department, Los Andes University, Colombia, from 1982 to 1984. Mr. Moreno was employed by SENA, Colombia, as Chief of the Organization and Systems Office, from 1977 to 1981, and served as Advisor to the Minister for the Finance and Public Credit Ministry of Colombia from 1976 to 1977.

Miguel A. Kerbes has served as Senior Vice President, Chief Risk Officer for the Bank since July 2002. Mr. Kerbes previously served as Vice President, Risk Management from 2000 to 2002. He served as the Risk Officer, Southern Cone Area for Banco Santander, with domicile in Chile, from 1995 to 2000, overseeing the Country Risk Managers for the area. From 1992 to 1995 he served with Bank of Boston, Chile as the Risk Director for credit and treasury risks and as Senior Risk Officer. From 1989 to 1992, Mr. Kerbes participated in the start-up of ING Bank in Chile, continuing as its Risk Officer, with domicile in Chile. He had previously served with ING Bank in Uruguay and participated in the start-up of ING Bank in Argentina from 1982 to 1992.

~~Bismark E. Rodríguez~~ Christopher Schechhas served as ~~the Bank’s Controller since July 2007. Mr. Rodriguez previously served as Vice President of the Internal Audit Department~~Chief Financial Officer of the Bank since ~~2004.~~September 2009. Previously, Mr. ~~Rodriguez also~~Schech served as ~~Senior Manager~~Chief Financial Officer in the Region International division at ~~PricewaterhouseCoopers~~Volvo Financial Services, part of AB Volvo Group based in Gothenburg, Sweden, covering operations in Latin America, Eastern Europe, Asia and Australia. Prior to that, Mr. Schech served in various capacities in Audit, Finance, and ~~countries~~Business Development at General Electric Company (GE), from ~~1991~~1996 to ~~2003.~~2008, including an assignment as Regional Manager, Financial Planning and Analysis at BAC Credomatic Network, a GE Capital Services joint venture based in Costa Rica, from 2005 to 2008. Mr. ~~Rodriguez is a Certified Public Accountant (CPA), a Certified Internal Auditor (CIA), a Certified~~Schech’s background also includes serving in various positions in the Financial Services ~~Auditor (CFSA),~~Audit Division at Coopers & Lybrand Deutsche Revision in Frankfurt, Germany, from 1990 to 1996. Mr. Schech holds a masters degree in Economic Studies from the University of Konstanz, Germany.

Gustavo Díaz was appointed Controller of the Bank in September 2009. Mr. Díaz has over 15 years of auditing experience in the financial industry. Prior to joining the Bank, he served as Internal Auditing Manager for Central American Bank for Economic Integration (CABEI) in Tegucigalpa, Honduras, from 2000 to 2009. Prior to that, he served as Internal Auditing Director and Compliance Officer for Corporación Financiera del Valle (Corfivalle) in Cali, Colombia, from 1994 to 2000, and as External Auditing Manager for KPMG Peat Marwick in Colombia and Chile, from 1985 to 1994. Mr. Díaz holds a masters degree in Professional Management from the University of Miami, Florida, and a ~~Certified Control Self-Assessment Specialist (CCSA); all designations~~masters degree in Finance with Major in International Business from the Universidad ICESI, Cali, Colombia. Mr. Díaz also has CIA, CFSA, and CCSA certifications, granted by The Institute of Internal Auditors (IIA).

~~Jaime Celorio~~ was appointed Senior Vice President, Chief Financial Officer of the Bank, in February 2008. Mr. Celorio previously served as Chief Financial Officer and Chief Administrative Officer for Merrill Lynch Mexico S.A. de C.V., Casa de Bolsa, Mexico from 2002 to 2007. Mr. Celorio served as Controller Associate of Emerging Markets in New York from 1998 to 2001 and Controller Associate in Mexico from 1995 to 1998, both for the Goldman Sachs Group. Mr. Celorio also served as Senior Auditor in the Audit Division and Supervisor in Financial Advisory Services from 1991 to 1994, both for PricewaterhouseCoopers, Mexico.

~~Ana Maria de Arias~~ has served as Senior Vice President, Organizational Performance and Development of the Bank since September 2008. Ms. Arias previously served as Senior Vice President of Human Resources and Administration from 2007 to 2008 and Senior Vice President of Human Resources and Corporate Operations from 2004 to 2007, both for the Bank. Prior to her employment with the Bank she served as Vice President of Human Resources from 2000 to 2004 and Assistant Vice President of Human Resources from 1999 to 2000, both for Banco General, S.A., Panama. She served in various capacities with the Human Resources department of the Panama Canal Commission, Panama, from 1990 to 1999.

Manuel Mejía-Aoun has served as ~~Head~~Chief Investment Officer of Bladex Asset Management, Inc. since November 2005 and as a Director of Bladex Asset Management since ~~November 2005.~~2008. Mr. Mejía-Aoun has over 1924 years of investment experience in emerging markets. Prior to joining the Bank, he was Chief Executive Officer of Maxblue, Deutsche Bank’s first personal financial consultancy business, focusing on high net worth investors in Latin America. Prior to that, he headed the Latin American Foreign Exchange and Local Money Markets Sales and Trading Group at Deutsche Bank. In 1995, Mr. Mejía-Aoun served as Chief Emerging Markets Strategist at Merrill Lynch, covering fixed income securities in Latin America, Eastern Europe, Africa and Asia. From 1987 to 1995, he established and headed the Emerging Markets Trading Group at Merrill Lynch.

B.	Compensation

Cash and Stock-Based Compensation

Executive Officers Compensation

The aggregate amount of cash compensation paid by the Bank during the year ended December 31, 2008 to the executive officers employed in the Bank’s head office as a group for services in all capacities was $3,264,589. During the year ended December 31, 2008, the Bank accrued, and in February 10, 2009 paid, performance-based bonuses to the Bank’s executive officers in the aggregate amount of $817,560. At December 31, 2008, the total amount set aside or accrued by the Bank to provide pension, retirement or similar benefits for executive officers was approximately $863,801.

The aggregate amount of cash compensation paid by the Bank during the year ended December 31, ~~2008,~~2009, to the executive officers employed in the Bank’s Head Office as a group for services in all capacities was $2,082,054. During the fiscal year ended December 31, 2009, the Bank accrued, and paid on February 26, 2010, performance-based bonuses to the Bank’s executive officers in the aggregate amount of $685,000. As of December 31, 2009, the total amount set aside or accrued by the Bank in 2009 to provide pension, retirement or similar benefits for executive officers was approximately $354,524.

In addition, the aggregate amount of revenue sharing earned by the executive and non-executive employees of Bladex Asset Management ~~a wholly-owned subsidiary of Bladex Holdings, Inc., which is in turn a wholly-owned subsidiary of~~during the ~~Bank,~~year ended December 31, 2009, as a group, for services in all capacities, was $3,922,580. During the fiscal year ended December 31, 2008, the Bank accrued, and on January 30 and February 4, 2009 paid, performance-based allocations and bonuses to this group of executives in the aggregate amount of $1,754,110 and $442,000, respectively.$2,972,152.

In February 2008, the Board approved the 2008 Stock Incentive Plan (the “2008 Plan”), which allows the Bank to grant restricted shares, restricted stock units, stock options and/or other similar compensation instruments to the directors, executive officers and other non-executive employees of the Bank.

On February ~~12, 2008,~~10, 2009, the Bank ~~awarded an aggregate of 172,106 stock options and 39,239~~granted 86,482 restricted stock units ~~under the 2008 Plan~~and 394,318 stock options to executive officers of the Bank. The Bank granted an additional ~~aggregate~~ of ~~52,930 stock options and 12,065~~45,538 restricted stock units ~~under the 2008 Plan~~and 207,667 stock options to other non-executive employees of the Bank. AsThese stock options have an exercise price of ~~December 31, 2008, the compensation cost charged against 2008 income in connection with these~~$10.15 and an expiration date of February 10, 2016. The restricted stock units and stock options was $178,280 and $178,301, respectively. The remaining compensation cost for these restricted stock units and options to be charged against income is $1,255,210 over a period of the next 3.12 years. Under the 2008 Plan, the restricted stock units originally provided for a cliff vesting period of four years. The stock options awarded under the 2008 Plan expire seven years after the award date and are exercisable on the fourth anniversary of the award date.

In November 2008, the Board approved certain amendments to the outstanding restricted stock units and stock options awarded under the 2008 Plan, providing that they now vest at a rate of 25% per year on each anniversary of the award date. These amendments did not result in additional compensation costs. In November 2008, the Board approved amendments to the 2004 Indexed Option Plan (“the 2004 Plan”), as well as amendments to outstanding options under the plan, to extend the term of the options by an additional three years (to a term of ten years), and to update the index used to determine the exercise price of the options anually. The November 2008 amendments also included an adjustment to the standard vesting schedule for options granted under the 2004 Plan, and a related amendment to the vesting schedule of options already issued under the plan, so that these outstanding options will vest at a rate of 25% per year, measured from the award date, ~~(with~~with vesting occurring on each anniversary of the award ~~date). Finally, the Board also amended the exercise price of outstanding~~date. The options held by U.S. taxpayers under the 2004 Plan to provide for a minimum exercise price equal to the fair market value of the Bank’s class E shares on the date of award. As of December 31, 2008, the compensation cost charged against 2008 income in connection with options granted to executive officers under the 2004 Plan was $379,381, and the remaining compensation cost for the options of $236,162 will be charged against income over a period of the next 1.08 years.

~~In November 2008, the Board also approved amendments to the 2006 Stock Option Plan related to the exercise terms of the outstanding options granted under the plan, which now~~ vest at a rate of 25% per year, measured from the award date, with vesting occurring on each anniversary of the award date. ~~These amendments do not result in an additional compensation cost.~~ As of December 31, ~~2008,~~2009, the compensation cost charged against ~~2008~~the Bank’s 2009 income in connection with these restricted stock units and stock options was ~~$201,944,~~$247,570 and ~~the~~$247,589, respectively. The total remaining ~~$428,283~~ compensation cost ~~for the options~~of $1,736,112 will be charged ~~against income~~ over a period of ~~the next 2.12~~3.11 years.

The Bank sponsors a defined contribution plan for its expatriate officers. The Bank’s contributions are determined as a percentage of the eligible officer’s annual salary, with each officer contributing an additional amount withheld from his or her salary. All contributions are administered by a trust through an independent third party. During ~~2008,~~2009, the Bank charged to salaries expense ~~$240,594~~$116,008 with respect to the contribution plan. As of December 31, ~~2008,~~2009, the accumulated liability payable under the contribution plan amounted to ~~$420,370.~~

$385,567.

~~2008~~2009 Chief Executive Officer Compensation

The ~~2008~~2009 compensation of the Bank's Chief Executive Officer included a base salary of $300,000, a performance-based cash bonus of ~~$350,000,~~$200,000, a performance-based stock option and a restricted stock units grant ~~(under the 2008 Plan)~~ with a value of ~~$300,000,~~$400,000, a retirement plan that included a contribution from the Bank of ~~$22,407~~$23,504 during ~~2008,~~2009, and other benefits amounting to ~~$10,315.~~$10,310. In addition, the Chief Executive Officer has a contractual severance payment of $300,000 in ~~case~~the event of his termination without ~~cause of $300,000.~~cause.

Board of Directors Compensation

Each non-employee director of the Bank receives an annual cash retainer of $40,000 for his or her services as a director and the Chairman of the Board receives an annual cash retainer in the amount of $85,000. This annual retainer covers seven Board and/or ~~stockholders~~shareholders meetings. If the Board meets more than seven times, the Bank will pay each director an attendance fee of $1,500 for each additional Board and/or ~~stockholders~~shareholders meeting. The Chairman of the Board is eligible to receive an ~~additional 50%~~attendance fee of $2,250 for each such additional Board, ~~stockholders~~shareholders or committee meeting attended.

The Chairman of the Audit and Compliance Committee receives an annual retainer of $20,000 and the Chairmen of the Assets and Liabilities Committee, Nomination and Compensation Committee, Credit Policy and Risk Assessment Committee, and Business Committee each receive an annual retainer of $15,000. The non-Chairman members of the Audit Committee each receive an annual retainer of $10,000 and the non-Chairman members of the Assets and Liabilities Committee, Nomination and Compensation Committee, Credit Policy and Risk Assessment Committee, and Business Committee, each receive an annual retainer of $7,500. These annual retainers cover seven meetings of the Audit Committee and six meetings each of the Assets and Liabilities Committee, Nomination and Compensation Committee, Credit Policy and Risk Assessment Committee, and Business Committee. When the Audit Committee has met more than seven times and the Assets and Liabilities Committee, Nomination and Compensation Committee, Credit Policy and Risk Assessment Committee, and Business Committee have met more than six times, the Bank will pay non-Chairman members an attendance fee of $1,000 for each additional committee meeting. The Chairman of each committee of the Board is eligible to receive an ~~additional 50%~~attendance fee of $1,500 for each additional committee meeting attended.

The aggregate amount of cash compensation paid by the Bank during the year ended December 31, ~~2008,~~2009, to the directors of the Bank as a group for their services as directors was ~~$789,590.~~$791,216.

The aggregate number of shares of restricted stock awarded during the year ended December 31, ~~2008,~~2009, to non-employee directors of the Bank as a group under the 2008 Plan was ~~31,246~~37,934 class E shares, equal to $50,000 for each non-employee director of the Bank and $75,000 for the Chairman of the Board. As of December 31, ~~2008,~~2009, the ~~compensation cost charged against 2008 income in connection with the shares of restricted stock awarded under the 2008 Plan was $43,981, and the remaining compensation~~total cost for these shares of restricted stock amounted to $474,934, of ~~$430,959~~which $44,240 was charged against income in 2009, and the remaining compensation cost of $430,694 for these shares of restricted stock will be charged against income over a period of ~~the next 4.54 years.~~

In November 2008, the Board amended the terms of the restricted stocks granted under the 2003 Restricted Stock Plan. In connection with these amendments, awards of restricted stock that were outstanding under the 2003 Restricted Stock Plan were amended to provide for a vesting schedule of 36% in 2008, 20% in 2009, 17% in 2010, 15% in 2011, and 12% in 2012 (on each anniversary of the date of award). These amendments do not result in an additional compensation cost. As of December 31, 2008, the compensation cost charged against income in 2008 in connection with the restricted stock awards granted to non-employee directors was $216,628 as of December 31, 2008, and the remaining compensation cost for these restricted stock awards of $370,685 will be charged against income over a period of the next 3.26 years.

As noted in “Executive Officers Compensation” above, in November 2008, the Board approved certain amendments to the 2004 Plan, and the outstanding options granted under this plan. These amendments provided for a ten-year term for each option, an updated index to determine the exercise price of these options, and an adjusted vesting schedule under the plan. For outstanding options granted under the 2004 Plan, the vesting schedule was specifically amended to a rate of 25% per year, measured from the award date (with vesting occurring on each anniversary of the award date) and the exercise price for options held by U.S. taxpayers was adjusted to include a minimum exercise price equal to the fair market value of the Bank’s class E shares on the date of award. As of December 31, 2008, the compensation cost charged against 2008 income in connection with options granted to directors under the 2004 Plan was $60,449, and the remaining compensation cost for these options of $21,512 will be charged against income over a period of the next 1.084.53 years.

5262

In November 2008, the Board also approved certain amendments to the vesting schedule of options awarded under the 2006 Stock Option Plan, with 25% of these options vesting on each anniversary of the date of award. These amendments do not result in an additional compensation cost. As of December 31, 2008, the compensation cost charged against 2008 income in connection with the options granted under the 2006 Stock Option Plan was $34,391, and the remaining compensation cost for these options of $39,648 will be charged against income over a period of the next 2.12 years.

Beneficial Ownership

As of December 31, ~~2008,~~2009, the Bank’s executive officers and directors ~~and members of the Advisory Council,~~ as a group owned an aggregate of ~~151,666~~140,424 class E shares, which was approximately ~~0.6%~~0.51% of all issued and outstanding class E shares.

The following tables set forth information regarding the number of shares, stock options, deferred equity units, restricted stock units, and indexed stock options owned by the Bank’s executive officers as of December 31, ~~2008,~~2009, as well as the restricted stock units and stock options granted in February ~~2009~~2010 under the 2008 ~~Plan:~~Plan.

Name and Position of
Executive Officer(1)

Number of
Shares
Beneficially
Owned as of
Dec. 31,
2008

Number of
Shares that
may be
acquired
within 60
days of Dec.
31, 2008

Stock
Options (2)
(1999 Stock
Option Plan
and 2006
Stock Option
Plan)
(pending to
vest)

Deferred
Equity
Units (3)

Indexed
Stock
Options (4)
(pending
to vest)

Restricted
Stock Units
(2008 Stock
Incentive
Plan) (5)

Stock
Options
(2008
Stock
Incentive
Plan) (5)
(pending
to vest)

Jaime Rivera
Chief Executive Officer
1,400 181,973 26,495 0 13,319 30,353 137,129
Rubens V. Amaral Jr.
Executive Vice President
Chief Commercial Officer
0 118,012 13,248 0 8,779 29,138 131,800
Gregory D. Testerman
Executive Vice President
Senior Managing Director,
Treasury & Capital Markets
0 38,996 10,599 0 5,250 30,110 136,064
Miguel Moreno
Executive Vice President,
Chief Operating Officer
5,724 44,216 5,299 0 3,819 13,113 59,115
Miguel A. Kerbes
Senior Vice President,
Chief Risk Officer
31,840 28,459 11,698 621 3,020 7,619 34,318
Bismark E. Rodriguez L.
Senior Vice President
Controller
0 1,745 0 0 0 3,278 14,778
Jaime Celorio
Senior Vice President,
Chief Financial Officer
0 588 0 0 0 904 4,067
Ana Maria de Arias
Senior Vice President,
Organizational Performance and Development
1,670 27,170 5,299 0 1,812 7,163 32,417
Total 40,634 441,159 72,638 621 35,999 121,678 549,688

Name and Position of Executive Officer	Number of Shares Beneficially Owned as of Dec. 31, 2009 (1)		Number of Shares that may be acquired within 60 days of Dec. 31, 2009 (2)		Stock Options (3)		Restricted Stock Units (2008 Stock Incentive Plan) (4)		Deferred Equity Units (5)
Jaime Rivera Chief Executive Officer		1,400		189,739		195,185		41,879		0
Rubens V. Amaral Jr. Executive Vice President Chief Commercial Officer		1,000		174,349		176,404		38,993		0
Gregory D. Testerman Executive Vice President Senior Managing Director Treasury and Capital Markets		2,349		91,900		177,923		39,641		0
Miguel Moreno Executive Vice President Chief Operating Officer		0		56,887		73,104		16,154		0
Miguel A. Kerbes Senior Vice President, Chief Risk Officer		0		49,967		44,315		9,248		621
Christopher Schech Senior Vice President, Chief Financial Officer		0		0		0		0		0
Gustavo Díaz Senior Vice President, Controller		0		0		0		0		0
Manuel Mejía-Aoun (6) Chief Investment Officer Bladex Asset Management		5,000		0		0		0		0
Total		9,749		562,842		666,931		145,915		621

(1)

Includes shares purchased by the executive or restricted stock units transferred to the executive.

(2)

Includes vested indexed and traditional stock options, as well as options and restricted stock units that will vest within 60 days of December 31, 2009.

(3)

Includes 271,081, 285,882, and 78,170 unvested stock options granted to executives officers on February 9, 2010, February 10, 2009, and February 12, 2008 respectively, under the 2008 Plan. Also includes 31,798 unvested stock options granted to executives of the Bank on February 13, 2007, under the 2006 Stock Option Plan. Also, an aggregate amount of 149,696; 154,062; and 30,230 stock options were granted to other non-executive employees under the 2008 Plan on February 9, 2010, February 10, 2009, and February 12, 2008 respectively; and an aggregate amount of 11,133 stock options were granted to other non-executive employees on February 13, 2007, under the 2006 Stock Option Plan. The exercise price and expiration date of these stock options are as follows: Grant of February 9, 2010, exercise price of $13.52 and expiration date of February 9, 2017; Grant of February 10, 2009, exercise price of $10.15 and expiration date of February 10, 2016; Grant of February 12, 2008, exercise price of $15.43 and expiration date of February 12, 2015; Grant of February 13, 2007, exercise price of $16.34 and expiration date of February 13, 2014.

(4)

Includes 65,390, 62,702, and 17,823 unvested restricted stock units granted to executive officers on February 9, 2010, February 10, 2009, and, February 12, 2008, respectively, under the 2008 Plan. Also, an aggregate amount of 36,106, 33,791, and 6,898 restricted stock units were granted to other non-executive officers under the 2008 Plan on February 9, 2010, February 10, 2009, and February 12, 2008 respectively.

(5)

Deferred Equity Units under the Bank's Deferred Compensation Plan.

(6)

The executive and ~~non-executive employees~~non-executives of Bladex Asset Management ~~Inc.,~~ are not ~~eligible~~elegible to receive grants under any of the equity compensation plans.

~~(2)~~

Only includes 68,888 stock options granted to executive officers on February 13, 2007, under the 2006 Stock Incentive Plan, and 3,750 stock options granted under the Bank’s 1999 Stock Option Plan. In addition, an aggregate number of 33,911 stock options were granted to other non-executive employees under the 2006 Stock Option Plan.

~~(3)~~

Deferred Equity Units granted under the Bank's Deferred Compensation Plan (“DC Plan”). In addition, as of the date hereof, there are 2,439 outstanding units that were granted to former executive officers of the Bank under the DC Plan.

~~(4)~~

~~An aggregate amount of 23,549 indexed stock options was granted to other non-executive employees.~~

~~(5)~~

Only includes 549,688 stock options and 121,678 restricted stock units granted to executive officers on February 12, 2008, and February 10, 2009. Additionally, an aggregate amount of 52,930 stock options and 12,065 restricted stock units were granted to other non-executive employees of the Bank on February 12, 2008, and an aggregate amount of 181,379 stock options and 39,773 restricted stock units were granted to other non-executive employees of the Bank on February 10, 2009.

The following table sets forth information regarding ownership of the Bank’s shares by members of its Board, including restricted shares, indexed stock options, and stock options, ~~held~~ as of December 31, ~~2008:~~2009:

Name of
Director

Number of
Shares
Beneficially
Owned as of
Dec. 31, 2008 (1)

Number of
Shares that may
be acquired
within 60 days
of Dec. 31, 2008

Stock Options
(2006 Stock
Option Plan)
(pending to vest)

Restricted
Shares (2)

Indexed Stock
Options
(pending to vest)

Guillermo Güémez García (3)
0 0 0 0 0
Roberto Feletti (4)
0 0 0 0 0
José Maria Rabelo (5)
0 0 0 0 0
Will C. Wood 10,480 6,482 1,061 5,895 536
Mario Covo 8,480 6,482 1,061 5,895 536
Herminio Blanco 28,005 6,482 1,061 5,895 536
William Hayes 20,275 6,482 1,061 5,895 536
Maria da Graça França 5,630 0 0 5,162 0
Gonzalo Menéndez Duque 12,722 9,727 1,591 8,844 803
Total 85,592 35,655 5,835 37,586 2,947

Name of Director	Number of Shares Beneficially Owned as of Dec. 31, 2009 (1)		Number of Shares that may be acquired within 60 days of Dec. 31, 2009 (2)		Stock Options (3)		Restricted Shares (4)
Guillermo Güémez García (5)		0		0		0		0
Carlos Weitz (6) (*)		0		0		0		0
José Maria Rabelo (*)		3,993		0		0		3,993
Will C. Wood		14,473		7,547		532		8,394
Mario Covo		12,473		7,547		532		8,394
Herminio Blanco		31,998		7,547		532		8,394
William Dick Hayes		11,168		7,547		532		8,394
Maria da Graça França		9,623		0		0		8,030
Gonzalo Menéndez Duque		18,712		11,324		797		12,592
Total		102,440		41,512		2,925		58,191

(1)

Includes class E shares held under the 2003 Restricted Stock Plan and the 2008 ~~Stock Incentive~~ Plan.

(2)

~~Under~~Includes vested indexed and traditional stock options that will vest within 60 days of December 31, 2009.

(3)

Includes unvested stock options granted to directors on February 13, 2007 under the 2006 Stock Option Plan.

(4)

Includes unvested restricted class E shares granted under the 2003 Restricted Stock Plan and the 2008 Stock Incentive Plan, directors receiving restricted shares will have the same rights as stockholders of the Bank, except that all such shares will be subject to restrictions on transferability, which will lapse on the fifth anniversary from the award date. In November 2008, the Board of Directors approved partial vestings of 20% each year on the anniversary date of the grant.Plan.

~~(3)~~

~~8,480~~(5)

12,473 class E shares corresponding to Mr. Gü~~emez's~~émez's entitlement under the 2003 Restricted Stock Plan and the 2008 ~~Stock Incentive~~ Plan have been issued to his employer, Banco de Mexico. In addition, an aggregate number of 2,119 stock options to which Mr. Gü~~emez~~émez was entitled under the 2006 Stock Option Plan have been granted to Banco de ~~Mexico; 1,058 of these options may be acquired within 60 days of December 31, 2008.~~ Mexico.

~~(4)~~

~~3,289~~(6)

3,993 class E shares corresponding to Mr. ~~Feletti's~~Weitz's entitlement under the 2008 ~~Stock Incentive~~ Plan have been issued to his employer, Banco de la Nación Argentina.

~~(5)~~

~~5,630 class E shares corresponding to Mr. Rabelo's entitlement under~~(*)

No longer part of the ~~2003 Restricted Stock Plan and the 2008 Stock Incentive Plan were issued to his employer, Banco do Brasil.~~Bank’s Board of Directors.

For additional information regarding stock options granted to executive officers and directors, see Item 18, “Financial Statements,” note ~~14.~~16.

C.	Board Practices

Non-Executive Officers of the Board (“Dignatarios”)

The following table sets forth the names, countries of citizenship, and ages of the Bank’s non-executive officers of the Board of Directors (“Dignatarios”), and their current office or position with other institutions. Dignatarios are elected annually by the members of the Board. Dignatarios attend meetings of the Board, participate in discussions and offer advice and counsel to the Board, but do not have the power to vote, unless they also are directors of the Bank.

Name	Country of Citizenship	Position held by Dignatario with the Bank	Age
Gonzalo Menéndez Duque Director Banco de Chile, Chile	Chile	Chairman of the Board	61

Maria da Graça França	Brazil	Treasurer	61

Ricardo Manuel Arango Partner Arias, Fábrega & Fábrega	Panama	Secretary	49

Committees of the Board

The Board conducts its business through meetings of the Board and through its committees. During the year ended December 31, 2009, the Board held fourteen meetings. Each director attended an average of 90% of the total number of Board meetings held during the year ended December 31, 2009. Each director also attended the prior year’s annual shareholders’ meeting.

The following table sets forth the five committees established by the Board, the current number of members of each committee and the total number of meetings held by each committee during the fiscal year ended December 31, 2009:

Committee	Number of members	Total number of meetings held
Audit and Compliance Committee	4	7
Credit Policy and Risk Assessment Committee	5	4
Assets and Liabilities Committee	5	6
Business Committee	5	4
Nomination and Compensation Committee	4	7

Corporate Governance Committee

The Board has decided not to establish a corporate governance committee. ~~Given~~Instead, given the importance ~~that~~of corporate governance ~~has for~~to the Bank, the Board ~~decided to address~~addresses all matters related to corporate governance at the Board ~~level and~~level. Further, the Audit and Compliance Committee is responsible for promoting continued improvement in the Bank’s corporate governance and verifying compliance with all applicable policies.

The Bank has included the information regarding its corporate governance practices necessary to comply with Section 303A of the NYSE’s Listed Company Manual/Corporate Governance Rules (the “NYSE Rules”) on its website at http://www.bladex.com. See Item 16G, “Corporate Governance.”

Stockholders, employees of the Bank, and other interested parties may communicate directly with the Board by corresponding to the address below:

Attn: Board of Directors of Banco Latinoamericano de Comercio Exterior, S.A.

c/o Mr. Gonzalo Menéndez Duque

Director & Chairman of the Board of Directors

Calle 50 and Aquilino de la Guardia

P.O. Box 0819-08730

Panama City, Republic of Panama

In addition, the Bank has selected EthicsPoint, an on-line reporting system, to provide stockholders, employees of the Bank, and other interested parties with an alternative channel to report anonymously actual or possible violations of the Bank’s Code of Ethics, as well as other work-related situations or irregular or suspicious transactions, accounting matters, internal audit or accounting controls. In order to file a report, a link is provided on the Bank’s website at http://www.bladex.com/Investors Center/Corporate Governance, under “Corporate Governance – Private Filing of Reports.”

~~Information as to Non-Executive Officers of the Board (“Dignatarios”)~~

The following table sets forth the names, countries of citizenship, and ages of the Bank’s non-executive officers (“Dignatarios”), and their current office or position with other institutions. Dignatarios are elected annually by the members of the Board. Dignatarios attend meetings of the Board, participate in discussions and offer advice and counsel to the Board, but do not have the power to vote, unless they also are directors of the Bank).

~~Name~~	~~Country of Citizenship~~	~~Position held by Dignatario~~ ~~with the Bank~~	~~Age~~
~~Gonzalo Menéndez Duque~~ 1 ~~Director~~ ~~Banco de Chile, Chile~~	~~Chile~~	~~Chairman of the Board~~	60
~~Maria da Graça França~~	~~Brazil~~	~~Treasurer~~	60
~~Ricardo Manuel Arango~~ ~~Partner~~ ~~Arias, Fábrega & Fábrega~~	~~Panama~~	~~Secretary~~	48

1 ~~Mr. Gonzalo Menéndez Duque was re-elected Chairman in April 2009 by the Board.~~

~~Committees of the Board~~

The Board conducts its business through meetings of the Board and through its committees. During the year ended December 31, 2008, the Board held ten meetings. Each director attended an average of 91% of the total number of Board meetings held during the year ended December 31, 2008. Each director also attended the prior year’s annual shareholder’s meeting.

Committee

Number of members

Total number of meetings held
Audit and Compliance Committee 4 8
Credit Policy and Risk Assessment Committee 5 5
Assets and Liabilities Committee 5 8
Business Committee 5 5
Nomination and Compensation Committee 4 11

Audit and Compliance Committee

The Audit and Compliance Committee is a standing committee of the Board. According to its Charter, the Audit and Compliance Committee must be comprised of at least three directors. The current members of the Audit and Compliance Committee are Will C. Wood (Chairman), Gonzalo Menéndez Duque, Maria da Graça França and ~~Roberto Feletti.~~

Esteban Alejandro Acerbo.

The Board has determined that all members of the Audit and Compliance Committee are independent directors ~~under the terms~~as defined by applicable laws and regulations, including rules promulgated by the ~~SEC~~Commission under the Sarbanes-Oxley Act, ~~of 2002 (the “Sarbanes-Oxley Act”),~~ Section 303A of the rules of the NYSE, ~~Rules,~~ and Agreement No. 04-2001 of the Superintendency of Banks. In addition, at least one of the members of the Audit and Compliance Committee is a “financial expert,” as defined in the rules enacted by the ~~SEC~~Commission under the Sarbanes-Oxley Act. The Audit and Compliance Committee’s financial expert is Gonzalo Menéndez Duque.

The purpose of the Audit and Compliance Committee is to provide assistance to the Board in fulfilling its oversight responsibilities regarding the processing of the Bank’s financial information, the integrity of the Bank’s financial statements, the Bank’s system of internal controls over financial reporting, the ~~process~~performance of both the internal audit and ~~external audit,~~the registered independent public accounting firm, the Bank’s corporate governance, compliance with legal and regulatory requirements and the Bank’s Code of Ethics. The Audit and Compliance Committee meets with each of the internal and independent auditors, and Bank’s Management to discuss the Bank’s audited consolidated financial statements and management’s discussion and analysis (“MD&A”).

The Audit and Compliance Committee meets at least six times a year, as required by the Superintendency of Banks, or more often if the circumstances so require. During the fiscal year ended December 31, ~~2008,~~2009, the committee met ~~eight~~seven times.

The Audit and Compliance Committee, in its capacity as a committee of the Board, is directly responsible for the appointment, compensation, and oversight of the Bank’s independent auditors, including the resolution of disagreements regarding financial reporting between the Bank’s management and the independent auditors. The Bank’s independent auditors are required to report directly to the committee.

~~The Charter of the Audit and Compliance Committee requires an annual self-evaluation of the committee’s performance.~~

~~The Audit and Compliance Committee’s Charter may be found on the Bank’s website at http://www.bladex.com.~~

See Item 16A, “Audit and Compliance Committee Financial Expert” and Item 16C, “Principal Accountant Fees and Services.”

The Audit and Compliance Committee Charter may be found on the Bank’s website.

Credit Policy and Risk Assessment Committee ~~(“CPER”)~~

The Credit Policy and Risk Assessment Committee is a standing committee of the Board. No member of the Credit Policy and Risk Assessment Committee ~~can~~may be an employee of the Bank. The Board has determined that, except for Guillermo Güémez García, all members of the Credit Policy and Risk Assessment Committee are ~~independent.~~independent as defined by applicable laws and regulations. The current members of the Credit Policy and Risk Assessment Committee are Guillermo Güémez García (Chairman), Gonzalo Menéndez Duque, ~~Will C. Wood,~~ Herminio Blanco, Mario Covo and ~~José Maria Rabelo.~~João Carlos Nobrega Pecego.

The Credit Policy and Risk Assessment Committee is in charge of reviewing and recommending to the Board all credit policies and procedures related to the management of the Bank’s risks. The committee also reviews the quality and profile of the Bank’s credit facilities and the risk levels that the Bank is willing to assume. The committee’s responsibilities also include, among other things, the review of operational and legal risks, the presentation for Board approval of country limits and limits exceeding delegated authority, and the approval of exemptions to credit policies.

The Credit Policy and Risk Assessment Committee performs its duties through the review of periodic reports from ~~the Bank’s~~ Risk Management, ~~Department,~~ and by way of its interaction with the Chief Risk Officer and other members of the Bank’s ~~management.~~Management. The committee meets at least four times per year. During the ~~year~~fiscal period ended December 31, ~~2008,~~2009, the committee held ~~five~~four meetings.

The Credit Policy and Risk Assessment Committee Charter may be found on the Bank’s ~~website at http://www.bladex.com.~~

website.

Assets and Liabilities Committee

The Assets and Liabilities Committee is a standing committee of the Board. No member of the Assets and Liabilities Committee ~~can~~may be an employee of the Bank. The Board has determined that except for Guillermo Güémez García, all members of the Assets and Liabilities Committee are independent ~~directors.~~directors as defined by applicable laws and regulations. The current members of the Assets and Liabilities Committee are Mario Covo (Chairman), Herminio Blanco, Guillermo Güémez García, William Dick Hayes and ~~José Maria Rabelo.~~João Carlos Nobrega Pecego.

The Assets and Liabilities Committee is responsible for reviewing and recommending to the Board all policies and procedures related to the Bank’s management of assets and liabilities to meet profitability, liquidity, and market risk control objectives. As part of its responsibilities, the committee reviews and recommends to the Board, among other things, policies related to the Bank’s funding, interest rate and liquidity gaps, liquidity investments, securities investments, derivative positions, funding strategies, and market risk.

The Assets and Liabilities Committee carries out its duties by reviewing periodic reports that it receives from the Bank’s ~~management,~~Management, and by way of its interaction with the Executive Vice President-Senior Managing Director, Treasury & Capital Markets and other members of the Bank’s ~~management.~~Management. The committee meets at least four times per year. During the fiscal year ended December 31, ~~2008,~~2009, the committee held ~~eight~~six meetings.

The Assets and Liabilities Committee Charter may be found on the Bank’s ~~website at http://www.bladex.com.~~website.

Business Committee

The Business Committee is a standing committee of the Board and was established in February 2008. The Board has determined that all members of the Business Committee are independent ~~directors.~~directors as defined by applicable laws and regulations. The current members of the Business Committee are William Dick Hayes (Chairman), Gonzalo Menéndez Duque, Mario Covo, Herminio Blanco and ~~José Maria Rabelo.~~João Carlos Nobrega Pecego.

The Business Committee’s primary responsibility is to support the Bank’s ~~management~~Management with business ideas and strategies and to provide follow-up on the business directives of the Board. The committee’s main objective ~~will always be~~is to improve the Bank’s efficiency in the management of the Bank’s various business units.

The Business Committee meets at least four times per year. During the fiscal year ended December 31, ~~2008,~~2009, the committee held ~~five~~four meetings.

Nomination and Compensation Committee

The Nomination and Compensation Committee is a standing committee of the Board. No member of the Nomination and Compensation Committee ~~can~~may be an employee of the Bank. The Board has determined that all members of the Nomination and Compensation Committee are independent ~~under the terms~~as defined by applicable laws and ~~regulations, including rules promulgated by the SEC under the Sarbanes-Oxley Act, Section 303A of the NYSE Rules, and Agreement No. 04-2001 of the Superintendency of Banks.~~regulations. The current members of the Nomination and Compensation Committee are Maria da Graça França (Chairman), ~~Mario Covo,~~ William Dick Hayes, Will C. Wood and ~~Roberto Feletti.~~Esteban Alejandro Acerbo.

The Nomination and Compensation Committee meets at least ~~four~~five times per year. During the fiscal year ended December 31, ~~2008,~~2009, the committee held ~~eleven~~seven meetings.

The Nomination and Compensation Committee’s primary responsibilities are to assist the Board by (1) identifying candidates to become Board members and recommending nominees for the annual meetings of ~~stockholders; by~~shareholders; (2) making recommendations to the Board concerning candidates for Chief Executive Officer and other executive officers and counseling on succession planning for executive officers; by(3) recommending compensation for Board members and committee members, including cash and equity compensation; by(4) recommending compensation for executive officers and employees of the Bank, including cash and equity compensation, policies for senior ~~management~~Management and employee benefit programs and plans; by(5) reviewing and recommending changes to the Bank’s Code of Ethics; and by(6) advising executive officers on issues related to the Bank’s personnel.

The Nomination and Compensation Committee will consider qualified director candidates recommended by ~~stockholders.~~shareholders. All director candidates will be evaluated in the same manner regardless of how they are recommended, including recommendations by ~~stockholders. For the current director nominees, the~~shareholders. The committee considers candidate qualifications and other factors, including, but not limited to, diversity in background and experience, industry knowledge, educational level and the needs of the Bank. ~~Stockholders~~Shareholders can mail any recommendations and an explanation of the qualifications of the candidates to the Secretary of the Bank at Calle 50 and Aquilino de la Guardia, P.O. Box 0819-08730, Panama City, Republic of Panama.

The Charter of the Nomination and Compensation Committee requires an annual self-evaluation of the committee’s performance.

The Nomination and Compensation Committee Charter may be found on the Bank’s ~~website at http://www.bladex.com.~~

website. Mr. Jaime Rivera is the only executive officer that serves as a member of the Board. None of the Bank’s executive officers serve as a director or a member of the Nomination and Compensation Committee, or any other committee serving an equivalent function ofor any other entity that has one or more of its executive officers serving as a member of ~~the~~such entity’s Board or ~~the~~ Nomination and Compensation Committee. None of the members of the Nomination and Compensation Committee has ever been an employee of the Bank.

Advisory Council

The Advisory Council was created by the Board in April 2000 pursuant to the powers granted to the Board under the Bank’s ~~Amended and Restated~~ Articles of Incorporation. The ~~duties~~primary duty of Advisory Council members ~~consist primarily of providing~~is to provide advice to the Board with respect to the business of the Bank in their areas of expertise. Each member of the Advisory Council receives $5,000 for each Advisory Council meeting attended. The aggregate amount of fees for services rendered by the Advisory Council during ~~2008~~2009 amounted to ~~$10,000.~~$15,000. During the fiscal year ended December 31, ~~2008,~~2009, the Advisory Council met once. The Advisory Council meets when convened by the Board.

The following table sets forth the names, positions, countries of citizenship and ages of the members of the Advisory Council of the Bank:

Name	Position	Country of Citizenship	Age

Roberto Feletti	Secretary of Economy Ministry of Economy and Public Finance	Argentina	51
Roberto Teixeira da Costa	Board Member Sul America, S.A.	Brazil	7475
Carlos Martabit	General Manager, Finance Division Banco del Estado de Chile	Chile	55
~~Alberto Motta, Jr~~	~~President~~ ~~Inversiones Bahía Ltd.~~	~~Panama~~	62
~~Enrique Cornejo~~	~~Minister of Transportation and Communications, Peru~~	~~Peru~~	5256
Santiago Perdomo	President Banco Colpatria – Red Multibanca Colpatria	Colombia	5152
Alberto Motta, Jr	President Inversiones Bahía Ltd.	Panama	63
Enrique Cornejo	Minister of Transportation and Communications, Peru	Peru	53

Employees

~~As of December 31, 2008,~~The following table presents the total number of permanent employees, ~~was 194, which were~~ geographically distributed, as follows: Head Office in Panama: 155; New York Agency: 7; Bladex Asset Management: 5; representative office in Argentina: 5; representative office in Brazil: 13; representative office in Mexico: 5; and Florida International Administrative Office: 4.at the dates indicated:

	As of December 31,
	2009		2008		2007
Bladex Head Office in Panama		127		155		157
New York Agency		7		7		8
Bladex Asset Management		5		5		3
Representative Office in Argentina		3		5		3
Representative Office in Brazil		12		13		10
Representative Office in Mexico		6		5		4
Florida International Administrative Office		4		4		3
Total Number of Permanent Employees		164		194		188

In February 2009, the Bank conducted a reduction in workforce mainly at its headquarters for the purpose of reducing headcount and associated personnel expenses.

E.	Share Ownership

See Item 6,6.B, “Directors, ~~Senior Management~~Executive Officers and Employees/Compensation/Beneficial Ownership.”

~~Item 7.~~

Item 7.

Major Stockholders and Related Party Transactions

A.	Major Stockholders

As of December 31, ~~2008,~~2009, the Bank was not directly or indirectly owned or controlled by another corporation or any foreign government, and no person was the registered owner of more than ~~9.7%~~6.7% of the total outstanding ~~shares~~ of voting capital stock of the Bank.

The following table sets forth information regarding the Bank’s stockholders that are the beneficial owners of 5% or more of any one class of the Bank’s voting stock atas of December 31, ~~2008:~~2009:

At December 31, 2008

Number of Shares

% of Class

% of Total

Class A
Banco de la Nación Argentina1
Bartolomé Mitre 326
1036 Buenos Aires, Argentina
1,045,348.00 16.5 2.9
Banco do Brasil2
SBS Quadra 1-Bloco A
CEP 70.0070-100
Brasilia, Brazil
974,551.00 15.4 2.7
Banco de Comercio Exterior de Colombia
Edif. Centro de Comercio Internacional
Calle 28 No. 13A-15
Bogotá, Colombia
488,547.00 7.7 1.3
Banco de la Nación (Perú)
Ave. Republica de Panamá 3664
San Isidro, Lima, Perú
446,556.00 7.0 1.2
Banco Central del Paraguay
Federación Rusa y Sargento Marecos
Asunción, Paraguay
434,658.00 6.9 1.2
Banco Central del Ecuador
Ave. Amazonas entre Juan Pablo Sanz y Atahualpa
Quito, Ecuador
431,217.00 6.8 1.2
Banco del Estado de Chile
Ave. Libertador Bernardo O’Higgins 1111
Santiago, Chile
323,412.75 5.1 0.9
Sub-total shares of Class A Common Stock 4,144,289.75 65.3 % 11.4 %
Total Shares of Class A Common Stock 6,342,189.16 100.0 % 17.4 %

Class B
Number of Shares

% of Class

% of Total

Banco de la Provincia de Buenos Aires.
San Martin 137
C1004AAC Buenos Aires, Argentina
884,460.98 33.8 2.4
Banco de la Nación Argentina
Bartolomé Mitre 326
1036 Buenos Aires, Argentina
295,944.50 11.3 0.8
The Korea Exchange Bank
181, Euljiro 2GA
Jungu, Seoul, Korea
147,172.50 5.6 0.4
Sub-total shares of Class B Common Stock 1,327,577.98 50.7 % 3.6 %
Total Shares of Class B Common Stock 2,617,783.63 100.0 % 7.2 %

Class E 3

Number of Shares

% of Class

% of Total

Arnhold and S. Bleichroeder Advisers, LLC
1345 Avenue of the Americas
New York, New York 10105-4300
3,541,212.00 12.9 9.7
Brandes Investment Partners, LP
11988 El Camino Real, Suite 500
San Diego, California 92130
2,173,513.00 7.9 6.0
Sub-total shares of Class E Common Stock 5,714,725.00 20.8 % 15.7 %
Total Shares of Class E Common Stock 27,453,115.00 100.0 % 75.4 %

Total Shares of Common Stock 36,413,087.79 100.0 % 100.0 %

	As of December 31, 2009
	Number of Shares		% of Class		% of Total
Class A
Banco de la Nación Argentina (1) Bartolomé Mitre 326 1036 Buenos Aires, Argentina		1,045,348.00		16.5		2.9
Banco do Brasil (2) SBS Quadra 1-Bloco A CEP 70.0070-100 Brasilia, Brazil		974,551.00		15.4		2.7
Banco de Comercio Exterior de Colombia Edif. Centro de Comercio Internacional Calle 28 No. 13A-15 Bogotá, Colombia		488,547.00		7.7		1.3
Banco de la Nación (Perú) Ave. Republica de Panamá 3664 San Isidro, Lima, Perú		446,556.00		7.0		1.2
Banco Central del Paraguay Federación Rusa y Sargento Marecos Asunción, Paraguay		434,658.00		6.9		1.2
Banco Central del Ecuador Ave. Amazonas entre Juan Pablo Sanz y Atahualpa Quito, Ecuador		431,217.00		6.8		1.2
Banco del Estado de Chile Ave. Libertador Bernardo O’Higgins 1111 Santiago, Chile		323,412.75		5.1		0.9
Sub-total shares of Class A Common Stock		4,144,289.75		65.3		11.3
Total Shares of Class A Common Stock		6,342,189.16		100.0		17.4

Class B	Number of Shares		% of Class		% of Total
Banco de la Provincia de Buenos Aires. San Martin 137 C1004AAC Buenos Aires, Argentina		884,460.98		34.2		2.4
Banco de la Nación Argentina Bartolomé Mitre 326 1036 Buenos Aires, Argentina		295,944.50		11.4		0.8
The Korea Exchange Bank 181, Euljiro 2GA Jungu, Seoul, Korea		147,172.50		5.7		0.4
Sub-total shares of Class B Common Stock		1,327,577.98		51.4		3.6
Total Shares of Class B Common Stock		2,584,881.93		100.0		7.1

Class E (3)	Number of Shares		% of Class		% of Total
Brandes Investment Partners, LP 11988 El Camino Real, Suite 500 San Diego, California 92130		2,462,034.00		8.9		6.7
First Eagle Investment Management, LLC 1345 Avenue of the Americas New York, New York 10105-4300		1,670,816.00		6.0		4.6
LSV Asset Management 1 N. Wacker Drive, Suite 4000 Chicago, Illinois 60606		1,511,347.00		5.5		4.1
Sub-total shares of Class E Common Stock		5,644,197.00		20.4		15.4
Total Shares of Class E Common Stock		27,618,545.00		100.0		75.6

Class F	Number of Shares		% of Class		% of Total
Total Shares of Class F Common Stock		0		0.0		0.0
Total Shares of Common Stock		36,545,616.09				100.0

1 (1)

Does not include an aggregate of ~~3,289~~7,282 class E shares corresponding to ~~Mr. Roberto Feletti’s entitlement~~former Director’s entitlements under the 2008 Stock Incentive Plan, that were issued to ~~his~~their employer, Banco de la Nación Argentina.

2 (2)

Does not include an aggregate of ~~5,630~~8,480 class E shares corresponding to ~~Mr. José Maria Rabelo’s entitlement~~former Directors’ entitlements under the 2003 Restricted Stock Plan and the 2008 Stock Incentive Plan that were issued to ~~his~~their employer, Banco do Brasil.

3 (3)

Source: Schedule ~~13G filing~~13Gs filed with the U.S. Securities and Exchange Commission dated December 31, ~~2008.~~2009.

All common shares have the same rights and privileges regardless of their class, except that:

The affirmative vote of three-quarters (3/4) of the issued and outstanding Class A shares is required (1) to dissolve and liquidate the Bank, (2) to amend certain material provisions of the Amended and Restated Articles of Incorporation, (3) to merge or consolidate the Bank with another entity and (4) to authorize the Bank to engage in activities other than those described in its Amended and Restated Articles of Incorporation;

The Class E shares are freely transferable without restriction to any person, while the Class A shares, Class B shares and Class BF shares can only be transferred to qualified ~~holders;~~holders of each class;

The Class B shares and Class F shares may be converted into Class E shares;

The holders of Class A shares, Class B shares and Class BF shares benefit from pre-emptive rights in respect of shares of the same class of shares owned by them that may be issued by virtue of a capital increase, in proportion to the shares of the class owned by them, but the holders of Class E shares do not; and

All classes vote separately for their respective directors. The holders of the class A common shares have the right to elect three (3) Directors; the holders of the class E common shares can elect five (5) Directors; and the holders of the class F common shares have the right to elect one (1) Director, so long as the number of issued and outstanding class F common shares is equal to or greater than fifteen per cent (15%) of the total number of issued and outstanding common shares of the corporation.

Set forth below are the number of shares of each class of the Bank’s stock issued and outstanding as of December 31, 2009:

Class of Shares	Number of Shares Outstanding as of December 31, 2009
Class A Common Shares		6,342,189.16
Class B Common Shares		2,584,881.93
Class E Common Shares		27,618,545.00
Class F Common Shares		0.00
Total Common Shares		36,545,616.09

The Bank had no preferred stock issued and outstanding as of December 31, 2009.

B.	Related Party Transactions

Certain directors of the Bank are executive officers of banks and/or other institutions located in Latin America, the Caribbean and elsewhere. Some of these banks and/or other institutions own shares of the Bank’s common stock and have entered into loan transactions with the Bank in the ordinary course of business. The terms and conditions of the loan transactions, including interest rates and collateral requirements, are substantially the same as the terms and conditions of comparable loan transactions entered into with other persons under similar market ~~conditions.~~conditions, and did not involve more than the normal risk of collectability or present other unfavorable features. As a matter of policy, directors of the Bank do not participate in the approval process for credit facilities extended to institutions of which they are executive officers or directors, nor do they participate with respect to decisions regarding country exposure limits in countries in which ~~the~~such institutions are domiciled.

AtAs of December 31, ~~2008,~~2009, the Bank did not have any outstanding credit facility with any related parties as defined by the Superintendency of Banks.

C.	Interests of Experts and Counsel

Not required in this Annual Report.

~~Item 8. Financial Information~~

Item 8.

Financial Information

A.	Consolidated Statements and Other Financial Information

The information included in Item 18 of this Annual Report is referred to and incorporated by reference into this Item 8.A.

Dividends

The Board’s policy is to declare and distribute quarterly cash dividends on the Bank’s common ~~stock,~~stock. During 2009, Bladex declared $21.9 million in quarterly dividends, compared to $32.0 million in 2008 and ~~the Board from time to time has declared special dividends to its stockholders.~~$32.0 million in 2007. Dividends are declared at the Board’s ~~discretion.~~

discretion and, from time to time, the Bank has declared special dividends. No special dividends were declared during 2009 and 2008.

The following table ~~shows~~presents information about common dividends paid on the dates indicated:

Payment date	Record date	Dividend per share
February 8, 2010	January 29, 2010	$	0.15
November 2, 2009	October 23, 2009	$	0.15
August 3, 2009	July 23, 2009	$	0.15
May 7, 2009	April 27, 2009	$	0.15
February 9, 2009	January 29, 2009	$	0.22
October 31, 2008	October 22, 2008	$	0.22
July 31, 2008	July 21, 2008	$	0.22
April 4, 2008	March 25, 2008	$	0.22
January 17, 2008	January 7, 2008	$	0.22

The following table presents information about preferred dividends paid on the dates indicated:

Payment date

Record date

Dividend per share

May 7, 2009 April 27, 2009 $ 0.15
February 9, 2009 January 29, 2009 $ 0.22
October 31, 2008 October 22, 2008 $ 0.22
July 31, 2008 July 21, 2008 $ 0.22
April 4, 2008 March 25, 2008 $ 0.22
January 17, 2008 January 7, 2008 $ 0.22

~~The following table shows information about preferred dividends paid on the dates indicated:~~

Payment date	Record date	Dividend per share
May 15, 2006	April 28, 2006	$	2.22
November 15, 2005	October 31, 2005	$	2.18
May 16, 2005	April 29, 2005	$	2.15
November 15, 2004	November 8, 2004	$	1.90
May 17, 2004	April 30, 2004	$	0.40

B.	Significant Changes

No significant change has occurred since the date of the annual financial statements (December 31, ~~2008) and /or since the most recent interim financial statements (March 31,~~ 2009).

~~Item 9.~~

Item 9.

The Offer and Listing

A.	Offer and Listing Details

The Bank’s Class E shares are listed on the NYSE under the symbol “BLX.” The following table shows the high and low sales prices of the Class E shares on the NYSE for the periods indicated:

	Price per Class E Share (in $)				Price per Class E Share (in $)
	High		Low		High		Low
2009						15.09		6.83
2008		20.74		8.17		20.74		8.17
2007		23.17		15.52		23.17		15.52
2006		18.70		14.59		18.70		14.59
2005		25.50		15.34		25.50		15.34
2004		20.00		14.00
2009:
2010:
May		13.89		11.92		14.78		12.80
April		12.94		9.26		16.48		14.16
March		11.48		6.83		15.14		14.11
February		11.38		8.61		14.57		13.33
January		14.99		8.78		15.08		13.67
2008:
2009:
December		14.89		11.09		14.68		13.47
November						15.00		13.72
2009:
First Quarter		14.99		6.83		14.99		6.83
Second Quarter						13.89		9.26
Third Quarter						15.09		11.80
Fourth Quarter						15.00		13.10
2008:
First Quarter		16.53		13.33		16.53		13.33
Second Quarter		19.46		15.50		19.46		15.50
Third Quarter		20.74		13.25		20.74		13.25
Fourth Quarter		14.89		8.17		14.89		8.17
2007:
First Quarter		17.12		15.52
Second Quarter		21.60		16.50
Third Quarter		23.17		16.53
Fourth Quarter		21.29		15.81

B.	Plan of Distribution

Not required in this Annual Report.

Markets

The Bank’s Class A shares and Class B shares were sold in private placements or sold in connection with the Bank’s 2003 rights offering, are not listed on any exchange and are not publicly traded. The Bank’s Class E shares, which constitute the only class of shares publicly traded (listed on the NYSE), represent approximately ~~75%~~75.6% of the total shares of the Bank’s common stock issued and outstanding atas of December 31, ~~2008.~~2009. The Bank’s Class B shares are convertible into Class E shares on a one-to-one basis.

D.	Selling Stockholders

Not required in this Annual Report.

Dilution

Not required in this Annual Report.

F.	Expenses of the Issue

Not required in this Annual Report.

Item 10.

Additional Information

A.	Share Capital

Not required in this Annual Report.

B. Memorandum and Articles of Association

Articles of Incorporation

Bladex is a bank organized under the laws of the Republic of Panama, and its articles of incorporation are recorded in the Public Registry Office of Panama, Republic of Panama, Section of Mercantile Persons, at microjacket 021666, roll 1050 and frame 0002.

Article 2 of Bladex’s Articles of Incorporation states that the purpose of the Bank is to promote the economic development and foreign trade of Latin American countries. To achieve this purpose, the Bank may engage in any banking or financial business, investment or other activity intended to promote the foreign trade and economic development of countries in Latin America. The Articles of Incorporation provide that Bladex may engage in activities beyond those described above provided that it has obtained stockholder approval in a resolution adopted upon the affirmative majority vote of the common shares, either present or represented, in a meeting of stockholders called to obtain such authorization, including the affirmative vote of the holders of three-fourths (3/4) of the Class A shares issued and outstanding.

Bladex’s Articles of Incorporation provide that the Board of Directors shall direct and control the business and assets of the Bank, except for those matters specifically reserved to stockholders by law or the Articles of Incorporation. The Board of Directors, however, may grant general and special powers of attorney authorizing directors, officers and employees of the Bank or other persons to transact such business and affairs within the competence of the Board of Directors, as the Board of Directors may deem convenient to entrust to such persons.

The Articles of Incorporation of Bladex do not contain a provision limiting the ability of the Board of Directors to approve a proposal, arrangement or contract in which a Director is materially interested, a provision limiting the ability of the Board of Directors to fix the compensation of its members, a provision requiring the mandatory retirement of a Director at any prescribed age, or a provision requiring a person to own a certain number of shares to qualify as a Director.

The Board of Directors consists of ten members: three Directors elected by the holders of the Class A common shares; five Directors elected by the holders of the Class E common shares; and two Directors elected by the holders of all common shares. For so long as the number of Class F common shares issued and outstanding is equal to or greater than fifteen percent (15%) of the total number of common shares issued and outstanding, the holders of the Class F common shares will have the right to elect one director and the Board of Directors will consist of eleven members. As of December 31, 2009, no Class F shares or preferred shares were issued and outstanding.

The number of Class F shares issued and outstanding is measured annually as provided in the Articles of Incorporation to determine whether the holders of Class F shares have a right to elect a Director or, if the holders of Class F shares have previously elected a Director whose term is not scheduled to expire, to determine whether to retain or replace such Director on the Board of Directors at the following annual ordinary shareholders’ meeting.

The Directors are elected by stockholders for periods of three (3) years and they may be re-elected. The holders of the Class A, Class E and Class F shares vote separately as a class in the election of Directors representing their respective class. In the election of Directors, each stockholder of each class electing a Director has a number of votes equal to the number of shares of such class held by such stockholder multiplied by the number of Directors to be elected by such class. The stockholder may cast all votes in favor of one candidate or distribute them among two or more of the Directors to be elected, as the shareholder may decide.

All common shares have the same rights and privileges regardless of their class, except that:

~~Dilution~~·

the affirmative vote of three-quarters (3/4) of the issued and outstanding Class A shares is required (A) to dissolve and liquidate the Bank, (B) to amend certain material provisions of the Articles of Incorporation, (C) to merge or consolidate the Bank with another entity and (D) to authorize the Bank to engage in activities other than those described as the purposes of the Bank in its Articles of Incorporation;

~~Not required in this Annual Report.~~

the Class E shares are freely transferable, but the Class A shares, Class B shares and Class F shares may only be transferred to qualified holders;

~~Expenses~~·

the Class B shares and Class F shares may be converted into Class E shares;

the holders of Class A shares, Class B shares and Class F shares benefit from pre-emptive rights, but the holders of Class E shares do not;

the classes vote separately for their representative directors; and

the rights, preferences, privileges and obligations of the ~~Issue~~preferred shares will be determined by the Board of Directors at the time of their issuance in a certificate of designation.

~~Not required~~Preferred shares have no voting rights, except in ~~this Annual Report.~~accordance with their certificate of designation mentioned above. Holders of preferred shares will have the right to elect one Director only upon a default in the terms of such preferred shares and only if contemplated in the certificate of designation. In the event the holders of the preferred shares are entitled to elect a Director, the total number of Directors in the Board of Directors will be increased by one. The rights of the holders of the common shares may be changed by an amendment to the Articles of Incorporation of the Bank.

Amendments to the Articles of Incorporation may be adopted by the affirmative majority vote of the common shares represented at the respective meeting, except for the following amendments which require, in addition, the affirmative vote of three-quarters (3/4) of all issued and outstanding Class A shares: (i) any amendment to the Bank’s purposes or powers, (ii) any amendment to the capital structure of the Bank and the qualifications to become a holder of any particular class of shares, (iii) any amendment to the provisions relating to the notice, quorum and voting at stockholders’ meetings, (iv) any amendment to the composition and election of the Board of Directors, as well as notices, quorum and voting at meetings of Directors, (v) any amendments to the powers of the Chief Executive Officer of the Bank and (vi) any amendments to the fundamental financial policies of the Bank.

The Articles of Incorporation of Bladex provide that there will be a general meeting of holders of the common shares every year, on such date and in such place as may be determined by resolution of the Board of Directors, to elect Directors and transact any other business duly submitted to the meeting by the Board of Directors. In addition, extraordinary meetings of holders of the common shares may be called by the Board of Directors, as it deems necessary. The Board of Directors or the Chairman of the Board must call an extraordinary meeting of holders of the common shares when requested in writing by one or more holders of common shares representing at least one-twentieth (1/20) of the issued and outstanding capital.

Notice of meetings of stockholders, whether ordinary or extraordinary, are personally delivered to each registered shareholder or sent by fax, telex, courier, air mail or any other means authorized by the Board of the Directors, at least 30 days before the date of the meeting, counted from the date that the notice is sent. The notice of the meeting must include the agenda of the meeting. At any meeting of stockholders, stockholders with a right to vote may be represented by a proxy, who need not be a shareholder and who may be appointed by public or private document, with or without power of substitution.

~~Item 10. Additional Information~~

A.	~~Share Capital~~

Upon request to the Board of Directors or the Chairman of the Board of Directors, stockholders representing at least one-twentieth (1/20) of the issued and outstanding shares of any given class may hold a meeting separately as a class for the purpose of considering any matter which, in accordance with the provisions of the Articles of Incorporation and the By-laws, is within their competence. In order to have a quorum at any meeting of stockholders, a majority of the common shares issued and outstanding must be represented at the meeting. Whenever a quorum is not obtained at a meeting of stockholders, the meeting shall be held on the second date set forth in the notice of the meeting. All resolutions of stockholders shall be adopted by the affirmative majority vote of the common shares represented at the meeting where the resolution was adopted, except where a super-majority vote of the Class A shareholders is required, as described above.

~~Not required~~Class A shares may be issued only as registered shares in ~~this Annual Report.~~the name of the following entities in Latin American countries: (i) central banks, (ii) banks in which the State is the majority shareholder or (iii) other government agencies. Class B shares may be issued only in the name of banks or financial institutions. Class E shares and preferred shares may be issued in the name of any person, whether a natural person or a legal entity. Class F shares may be issued only (i) in the name of state entities or agencies of countries that are not Latin American countries, including central banks and banks in which the State is the majority shareholder or (ii) in the name of multilateral financial institutions, whether international or regional.

B.	~~Memorandum and Articles of Association~~

Neither Bladex’s Articles of Incorporation nor its By-laws contain any provision requiring disclosure with respect to a shareholder’s ownership above a certain threshold. There are no conditions imposed by the Articles of Incorporation regarding changes in capital that are more stringent than conditions imposed by Panamanian law.

The Amended and Restated Articles of Incorporation were filed as an exhibit to the Form 20-F for the fiscal year ended December 31, ~~2002~~2008 filed with the ~~SEC on February 24, 2003 and Item 10.B of the Form 20-F for the fiscal year ended December 31, 2004 filed with the SEC~~Commission on June ~~23, 2005 are referred to and incorporated by reference into this Item 10.B.~~26, 2009.

C.	Material Contracts

The Bank has not entered into any material contract outside the ordinary course of business during the two-year period immediately preceding the date of this Annual Report. ~~See Item 18, “Financial Statements,” note 20.~~

D.	Exchange Controls

Currently, there are no restrictions or limitations under Panamanian law on the export or import of capital, including foreign exchange controls, the payment of dividends or interest, or the rights of foreign stockholders to hold or vote stock.

Taxation

The following is a summary of certain U.S. federal and Panamanian tax matters that may be relevant with respect to the acquisition, ownership and disposition of the Bank’s Class E shares. Prospective purchasers of Class E shares should consult their own tax advisors as to the United States, Panamanian or other tax consequences of the acquisition, ownership and disposition of Class E shares.

This summary does not address the consequences of the acquisition, ownership or disposition of the Bank’s Class A or Class B shares.

United States Taxes

This summary describes the ~~principal~~material U.S. federal income tax consequences of the ownership and disposition of the Class E shares, but does not purport to be a comprehensive description of all of the tax considerations that may be relevant to holders of Class E shares. This summary applies only to current holders that hold Class E shares as capital assets and does not address classes of holders that are subject to special treatment under the United States Internal Revenue Code of 1986, as amended (the “Code”), such as dealers in securities or currencies, financial institutions, tax-exempt entities, regulated investment companies, insurance companies, securities traders that elect mark-to-market tax accounting, persons subject to the alternative minimum tax, certain U.S. expatriates, persons holding Class E shares as part of a hedging, constructive ownership or conversion transaction or a straddle, holders whose functional currency is not the U.S. dollar, or a holder that owns 10% or more (directly, indirectly or constructively) of the voting shares of the Bank.

This summary is based upon the Code, existing, temporary and proposed regulations promulgated there under, judicial decisions and administrative pronouncements, as all in effect on the date of this Annual Report and which are subject to change (possibly on a retroactive basis) and to differing interpretations. Purchasers or holders of Class E shares should consult their own tax advisors as to the U.S. federal, state and local, and foreign tax consequences of the ownership and disposition of Class E shares in their particular circumstances.

As used herein, a “U.S. Holder” refers to a beneficial holder of Class E shares that is, for U.S. federal income tax purposes, (1) an individual citizen or resident of the United States, (2) a corporation, or an entity treated as a corporation, organized or created in or under the laws of the U.S. or any political subdivision thereof, (3) an estate the income of which is subject to U.S. federal income taxation without regard to the source of its income, (4) a trust, if both (A) a court within the United States is able to exercise primary supervision over the administration of the trust and (B) one or more U.S. persons (as defined in the Code) have the authority to control all substantial decisions of the trust, or a trust that has made a valid election under U.S. Treasury Regulations to be treated as a domestic trust, and (5) any holder otherwise subject to U.S. federal income taxation on a net income basis with respect to Class E shares (including a non-resident alien individual or foreign corporation that holds, or is deemed to hold, any Class E share in connection with the conduct of a U.S. trade or business). If a partnership (including for this purpose any entity treated as a partnership for U.S. federal income tax purposes) is a beneficial owner of Class E shares, the U.S. federal income tax consequences to a partner in the partnership will generally depend on the status of the partner and the activities of the partnership. A holder of Class E shares that is a partnership and the partners in such partnership should consult their own tax advisors regarding the U.S. federal income tax consequences of the ownership and disposition of Class E shares.

Taxation of Distributions

Subject to the “Passive Foreign Investment Company Status” discussion below, to the extent paid out of current or accumulated earnings and profits of the Bank as determined under U.S. federal income tax principles (“earnings and profits”), distributions made with respect to Class E shares (other than certain pro rata distributions of capital stock of the Bank or rights to subscribe for shares of capital stock of the Bank) will be includable in income of a U.S. Holder as ordinary dividend income in accordance with the U.S. Holder’s regular method of accounting for U.S. federal income tax purposes whether paid in cash or Class E shares. To the extent that a distribution exceeds the Bank’s earnings and profits, such distribution will be treated, first, as a nontaxable return of capital to the extent of the U.S. Holder’s tax basis in the Class E shares and will reduce the U.S. Holder’s tax basis in such shares, and thereafter as a capital gain from the sale or disposition of Class E shares. See Item 10, “Additional Information/Taxation/United States Taxes-Taxation of Capital Gains.” The amount of the distribution will equal the gross amount of the distribution received by the U.S. Holder, including any Panamanian taxes withheld from such distribution.

Distributions made with respect to Class E shares out of earnings and profits generally will be treated as dividend income from sources outside the United States. U.S. Holders that are corporations will not be entitled to the “dividends received deduction” under Section 243 of the Code with respect to such dividends. Dividends may be eligible for the special 15% rate applicable to “qualified dividend income” received by an individual, provided, that (1) the Bank is not a “passive foreign investment company” in the year in which the dividend is paid nor in the immediately preceding year, (2) the class of stock with respect to which the dividend is paid is readily tradable on an established securities market in the U.S., and (3) the U.S. Holder held his shares for more than 60 days during the 121-day period beginning 60 days prior to the ex-dividend date and meets other holding period requirements. Subject to certain conditions and limitations, Panamanian tax withheld from dividends will be treated as a foreign income tax eligible for deduction from taxable income or as a credit against a U.S. Holder’s U.S. federal income tax liability. Distributions of dividend income made with respect to Class E shares generally will be treated as “passive” income or, in the case of certain U.S. Holders, “general category income,” for purposes of computing a U.S. Holder’s U.S. foreign tax credit.

Less than 25 percent of the Bank’s gross income is effectively connected with the conduct of a trade or business in the United States, and the Bank expects this to remain true. If this remains the case, a holder of Class E shares that is not a U.S. Holder (a “non-U.S. Holder”) generally will not be subject to U.S. federal income tax or withholding tax on distributions received on Class E shares that are treated as dividend income for U.S. federal income tax purposes. Special rules may apply in the case of non-U.S. Holders (1) that are engaged in a U.S. trade or business, (2) that are former citizens or long-term residents of the United States, “controlled foreign corporations,” corporations that accumulate earnings to avoid U.S. federal income tax, and certain foreign charitable organizations, each within the meaning of the Code, or (3) certain non-resident alien individuals who are present in the United States for 183 days or more during a taxable year. Such persons should consult their own tax advisors as to the U.S. federal income or other tax consequences of the ownership and disposition of Class E shares.

Taxation of Capital Gains

Subject to the “Passive Foreign Investment Company Status” discussion below, gain or loss realized by a U.S. Holder on the sale or other disposition of Class E shares will generally be subject to U.S. federal income tax as capital gain or loss in an amount equal to the difference between the U.S. Holder’s tax basis in the Class E shares and the amount realized on the disposition. Such gain will be treated as long-term capital gain if the Class E shares are held by the U.S. Holder for more than one year at the time of the sale or other disposition. Otherwise, the gain will be treated as a short-term capital gain. Gain realized by a U.S. Holder on the sale or other disposition of Class E shares generally will be treated as U.S. source income for U.S. foreign tax credit purposes, unless the gain is attributable to an office or fixed place of business maintained by the U.S. Holder outside the United States or is recognized by an individual whose tax home is outside the United States, and certain other conditions are met. For U.S. federal income tax purposes, capital losses are subject to limitations on deductibility. As a general rule, U.S. Holders that are corporations can use capital losses for a taxable year only to offset capital gains in that year. A corporation may be entitled to carry back unused capital losses to the three preceding tax years and to carry over losses to the five following tax years. In the case of non-corporate U.S. Holders, capital losses in a taxable year are deductible to the extent of any capital gains plus ordinary income of up to $3,000. Unused capital losses of non-corporate U.S. Holders may be carried over indefinitely.

A non-U.S. Holder of Class E shares will generally not be subject to U.S. federal income tax or withholding tax on gain realized on the sale or other disposition of Class E shares. However, special rules may apply in the case of non-U.S. Holders (1) that are engaged in a U.S. trade or business, (2) that are former citizens or long-term residents of the United States, “controlled foreign corporations,” corporations which accumulate earnings to avoid U.S. federal income tax, and certain foreign charitable organizations, each within the meaning of the Code, or (3) certain non-resident alien individuals who are present in the United States for 183 days or more during a taxable year. Such persons should consult their own tax advisors as to the United States or other tax consequences of the purchase, ownership and disposition of the Class E shares.

Passive Foreign Investment Company Status

Under the Code, certain rules apply to an entity classified as a “passive foreign investment company” (“PFIC”). A PFIC is defined as any foreign (i.e., non-U.S.) corporation if either (1) 75% or more of its gross income for the taxable year is passive income (generally including, among other types of income, dividends, interest and gains from the sale of stock and securities) or (2) 50% or more of its assets (by value) produce, or are held for the production of, passive income. The Code provides an exception for foreign institutions in the active conduct of a banking business, provided the institution is licensed to do business in the United States. Under proposed regulations, the exception is extended to a foreign corporation that is not licensed to do business as a bank in the United States so long as such foreign corporation is an “active foreign bank.” Based on its current and intended method of operations as described herein, the Bank believes that it is not a PFIC under current U.S. federal income tax law because it is eligible for the exception available to active foreign banks in the Code and the proposed regulations. The Bank intends to continue to operate in a manner that will entitle the Bank to rely upon that exception to avoid classification as a PFIC.

If the Bank were to become a PFIC for purposes of the Code, unless a U.S. Holder makes the election described below, a U.S. Holder generally will be subject to a special tax charge with respect to (a) any gain realized on the sale or other disposition of Class E shares and (b) any “excess distribution” by the Bank to the U.S. Holder (generally, any distributions including return of capital distributions, received by the U.S. Holder on the Class E shares in a taxable year that are greater than 125 percent of the average annual distributions received by the U.S. Holder in the three preceding taxable years, or, if shorter, the U.S. Holder’s holding period). Under these rules (1) the gain or excess distribution would be allocated ratably over the U.S. Holder’s holding period for the Class E shares, (2) the amount allocated to the current taxable year would be treated as ordinary income, (3) the amount allocated to each prior year generally would be subject to tax at the highest rate in effect for that year; and (4) an interest charge at the rate generally applicable to underpayments of tax would be imposed with respect to the resulting tax attributable to each such prior year. For purposes of the foregoing rules, a U.S. Holder of Class E shares that uses such stock as security for a loan will be treated as having disposed of such stock.

If the Bank were a PFIC, U.S. Holders of interests in a holder of Class E shares may be treated as indirect holders of their proportionate share of the Class E shares and may be taxed on their proportionate share of any excess distributions or gain attributable to the Class E shares. An indirect holder also must treat an appropriate portion of its gain on the sale or disposition of its interest in the actual holder as gain on the sale of Class E shares.

If the Bank were to become a PFIC, a U.S. Holder could make an election, provided the Bank complies with certain reporting requirements, to have the Bank treated, with respect to such U.S. Holder, as a “qualified electing fund” (hereinafter referred to as a “QEF election”), in which case, the electing U.S. Holder would be required to include annually in gross income the U.S. Holder’s proportionate share of the Bank’s ordinary earnings and net capital gains, whether or not such amounts are actually distributed. If the Bank were to become a PFIC, the Bank intends to so notify each U.S. Holder and to comply with all reporting requirements necessary for a U.S. Holder to make a QEF election and will provide to record U.S. Holders of Class E shares such information as may be required to make such QEF election.

If the Bank is a PFIC in any year, a U.S. Holder that beneficially owns Class E shares during such year must make an annual return on Internal Revenue Service Form 8621, which describes the income received (or deemed to be received if a QEF election is in effect) from the Bank. The Bank will, if applicable, provide all information necessary for a U.S. Holder of record to make an annual return on Form 8621.

Additionally, recently enacted legislation creates an additional annual filing requirement for U.S. persons who are shareholders of a PFIC. The legislation does not describe what information will be required to be included in the additional annual filing, but rather grants the Secretary of the U.S. Treasury authority to decide what information must be included in such annual filing. If the Bank were a PFIC for a given taxable year, then U.S. Holders should consult their tax adviser concerning their annual filing requirements.

A U.S. Holder that owns certain “marketable stock” in a PFIC may elect to mark-to-market such stock and, subject to certain exceptions, include in income any gain (increases in market value) or loss (decreases in market value to the extent of prior gains recognized) realized as ordinary income or loss to avoid the adverse consequences described above. U.S. Holders of Class E shares are urged to consult their own tax advisors as to the consequences of owning stock in a PFIC and whether such U.S. Holder would be eligible to make either of the aforementioned elections to mitigate the adverse effects of such consequences.

Information Reporting and Backup Withholding

Each U.S. payor making payments in respect of Class E shares will generally be required to provide the Internal Revenue Service (the “IRS”) with certain information, including the name, address and taxpayer identification number of the beneficial owner of Class E shares, and the aggregate amount of dividends paid to such beneficial owner during the calendar year. Under the backup withholding rules, a holder may be subject to backup withholding at a current rate of 28% with respect to proceeds received on the sale or exchange of Class E shares within the United States by non-corporate U.S. Holders and to dividends paid, unless such holder (1) is a corporation or comes within certain other exempt categories (including securities broker-dealers, other financial institutions, tax-exempt organizations, qualified pension and profit sharing trusts and individual retirement accounts), and, when required, demonstrates this fact or (2) provides a taxpayer identification number, certifies as to no loss of exemption and otherwise complies with the applicable requirements of the backup withholding rules. However, U.S. Holders should be aware that under recently passed legislation, the information reporting requirement is extended to all holders, including corporations (other than tax-exempt corporations), for payments made after December 31, 2011. Non-U.S. Holders are generally exempt from information reporting and backup withholding, but may be required to provide a properly completed Form W-8BEN (or other similar form) or otherwise comply with applicable certification and identification procedures in order to prove their exemption. This backup withholding tax is not an additional tax and any amounts withheld from a payment to a holder of Class E shares will be refunded (or credited against such holder’s U.S. federal income tax liability, if any) provided that the required information is furnished to the IRS.

There is no income tax treaty between Panama and the United States.

Panamanian Taxes

The following is a summary of the principal Panamanian tax consequences arising in connection with the ownership and disposition of the Bank’s Class E shares. This summary is based upon the laws and regulations of Panama, as well as court precedents and interpretative rulings, in effect as of the date of this Annual Report, all of which are subject to prospective and retroactive change.

General Principle

The Bank is exempt from income tax in Panama under a special exemption granted to the Bank pursuant to Contract 103-78 of July 25, 1978 between the Nation and Bladex. In addition, under general rules of income tax in Panama, only income that is deemed to be Panamanian source income is subject to taxation in Panama. Accordingly, since the Bank’s income is derived primarily from sources outside of Panama and is not deemed to be ~~Panamaian~~Panamanian source income, even in the absence of the special exemption, the Bank would have limited income tax liability in Panama.

Taxation of Distributions

Dividends, whether cash or in kind, paid by the Bank in respect of its shares are also exempt from dividend tax or other withholding under the special exemption described above. In the absence of this special exemption, there would be a 10% withholding tax on dividends or distributions paid in respect of the Bank’s registered shares to the extent the dividends were paid from income derived by the Bank from Panamanian sources.

Taxation of Capital Gains

Since the Class E shares are listed on the NYSE, any capital gains realized by an individual or a corporation, regardless of its nationality or residency, on the sale or other disposition of such shares outside of Panama, would be exempted from capital gains taxes or any other taxes in Panama.

F.	Dividends and Paying Agents

Not required in this Annual Report.

G.	Statement by Experts

Not required in this Annual Report.

H.	Documents on Display

Upon written or oral request, the Bank will provide without charge to each person to whom this Annual Report is delivered, a copy of any or all of the documents listed as exhibits to this Annual Report (other than exhibits to those documents, unless the exhibits are specifically incorporated by reference in the documents). Written requests for copies should be directed to the attention of Mr. ~~Jaime Celorio,~~Christopher Schech, Chief Financial Officer, Bladex, as follows: (1) if by regular mail, to P.O. Box 0819-08730, Panama City, Republic of Panama, and (2) if by courier, to Calle 50 y Aquilino de la Guardia, Panama City, Republic of Panama. Telephone requests may be directed to Mr. ~~Celorio~~Schech at ~~country code~~ + (507) 210-8630. Written requests may also be faxed to Mr. ~~Celorio~~Schech at ~~country code~~ + (507) 269-6333 or sent via e-mail to ~~jcelorio@bladex.com.~~cschech@bladex.com. Information is also available on the Bank’s website at: http://www.bladex.com.

~~I. Subsidiary Information~~

~~Not applicable.~~

~~Item 11.~~I.

~~Quantitative and Qualitative Disclosure About Market Risk~~Subsidiary Information

Not applicable.

Item 11. Quantitative and Qualitative Disclosure About Market Risk

The Bank’s risk management policies, as approved by the Board from time to time, are designed to identify and control the Bank’s credit and market risks by establishing and monitoring appropriate limits on the Bank’s credit and market exposures. Certain members of the Board constitute the Assets and Liabilities Committee, which meets on a regular basis and monitors and controls the risks in each specific area. At the ~~management~~Management level, the Bank has a Risk Management Department that measures and controls the credit and market exposure of the Bank.

6681

The Bank’s businesses are subject to market risk. The components of this market risk are interest rate risk inherent in the Bank’s balance sheet, foreign exchange risk, and the price risk in the Bank’s ~~principal~~ investment portfolio and ~~market value risk~~ in the Bank’s trading portfolios.

For quantitative information relating to the Bank’s interest rate risk and information relating to the Bank’s management of interest rate risk, see Item 5, “Operating and Financial Review and Prospects/Liquidity and Capital ~~Resources,~~Resources.” ~~and Item 18, “Financial Statements,” notes 2(r) and 21.~~

For information regarding derivative financial instruments, see Item 18, “Financial Statements,” notes ~~2(r)~~2(t) and ~~21.~~ 20.

For information regarding investment securities, see Item 4, “Information on the Company/Business Overview/Investment Securities,” and Item 18, “Financial Statements,” note 6.5.

The table below lists for each of the years ~~2009~~from 2010 to ~~2013~~2014 the notional amounts and weighted interest rates, as of December 31, ~~2008,~~2009, for derivative financial instruments and other financial instruments that are sensitive to changes in interest rates, including the Bank’s investment securities, loans, borrowings and placements, interest rate swaps, cross currency swaps, forward currency exchange agreements, and trading assets and liabilities. Amounts presented below excludes the Bank’s participation in the Investment Fund. The Bank consolidates the Feeder retaining the specialized accounting for investment companies applied by the Feeder in the Fund, reporting it within the “Investment Fund” line in the consolidated balance sheet; see Item 18, “Financial Statements”, notes 2 (d) and 6.

Interest Rate Risk Management and Sensitivity

As of December 31, 2009

Expected maturity date
	2010			2011			2012			2013			2014			There-after			Without maturity		Total 2009			Fair value 2009
($ Equivalent in thousand)
NON-TRADING ASSETS
Investment Securities
Fixed rate
U.S. Dollars		30,000			21,175			5,000			90,000			73,000			135,000			-		354,175			408,127
Average fixed rate		7.46	%		8.79	%		10	%		9.83	%		9	%		7.69	%		-		8.58	%
Floating rate
U.S. Dollars		-			-			25,000			-			-			25,000			-		50,000			48,857
Average floating rate		-			-			0.86	%		-			-			2.08	%		-		1.47	%
Loans
Fixed rate
U.S. Dollars		1,195,586			39,545			6,988			1,479			-			-			-		1,243,598			1,243,022
Average fixed rate		2.97	%		5.19	%		6.07	%		6.83	%		-			-			-		3.06	%
Mexican Peso		41,944			19,037			3,606			1,980			590			-			-		67,157			71,294
Average fixed rate		10.50	%		10.20	%		11.59	%		12.15	%		12.50	%		-			-		10.54	%
Floating rate
U.S. Dollars (1)		595,873			369,933			297,207			112,341			59,782			28,335			-		1,463,471			1,426,741
Average floating rate		3.04	%		2.65	%		2.90	%		3.42	%		4.51	%		3.42	%		-		3.01	%
Mexican Peso		1,375			1,051			-			-			-			-			-		2,426			2,523
Average floating rate		11.17	%		11.17	%		-			-			-			-			-		11.17	%
Euro		1,623			807			180			-			-			-			-		2,610			2,595
Average floating rate		2.30	%		2.28	%		2.25	%		-			-			-			-		2.29	%
LIABILITIES
Borrowings and Placements(2)
Fixed rate
U.S. Dollars		404,051			24,852			-			-			-			-			-		428,903			428,841
Average fixed rate		1.67	%		2.35	%																1.71	%

Expected maturity date
2009 2010 2011 2012 2013
There-
after

Without
maturity
Total 2008
Fair value
2008

($ Equivalent in thousand)
NON-TRADING ASSETS
Investment Securities
Fixed rate
U.S. Dollars 87,975 30,000 29,222 50,000 90,000 233,000 - 520,197 555,481
Average fixed rate 5.19 % 7.46 % 8.90 % 9.69 % 9.83 % 8.21 % - 8.11 %
Floating rate
U.S. Dollars - 41,000 - 25,000 - 25,000 - 91,000 80,581
Average floating rate - 3.30 % - 2.82 % - 3.95 % - 3.34 %
Loans
Fixed rate
U.S. Dollars 823,126 6,888 24,643 3,777 1,479 - - 859,913 850,312
Average fixed rate 5.03 % 6.81 % 7.04 % 7.11 % 6.83 % - - 5.11 %
Mexican Peso 26,766 31,105 11,677 2,249 1,524 - - 73,321 76,706
Average fixed rate 10.29 % 10.27 % 9.72 % 11.69 % 12.07 % - - 10.27 %
Floating rate
U.S. Dollars 738,680 305,905 265,387 221,802 88,585 53,998 1,674,357 1,536,705
Average floating rate 4.79 % 4.53 % 4.12 % 3.52 % 4.43 % 5.01 % 4.46 %
Mexican Peso 7,304 - - - - - - 7,304 7,257
Average floating rate 11.78 % - - - - - - 11.78 %
Euro 1,216 1,574 783 175 - - - 3,748 3,626
Average floating rate 6.21 % 6.21 % 6.22 % 6.26 % - - - 6.21 %
LIABILITIES
Borrowings and Placements(1)

Fixed rate
U.S. Dollars 1,138,394 14,919 4,852 - - - 1,158,165 1,156,233
Average fixed rate 3.75 % 3.95 % 2.76 % - - - 3.75 %
Mexican Peso 27,726 27,726 10,710 1,846 1,087 - - 69,095 71,657
Average fixed rate 8.38 % 8.38 % 8.42 % 9.36 % 9.59 % - - 8.43 %
Euro 80,333 - - - - - - 80,333 80,453
Average fixed rate 5.70 % - - - - - - 5.70 %
Yen 44,114 - - - - - - 44,114 44,046
Average fixed rate 1.79 % - - - - - - 1.79 %
Peruvian Soles - - - - - 39,135 - 39,135 38,362
Average fixed rate - - - - - 6.50 % - 6.50 %
Floating rate
U.S. Dollars 132,634 428,135 11,405 150,000 200,00 - - 922,174 857,154
Average floating rate 3.37 % 3.78 % 3.53 % 1.88 % 4.73 % - - 3.61 %
Mexican Peso - - - - 104,857 - - 104,857 90,062
Average floating rate - - - - 9.63 % - - 9.63 %

Interest Rate Swaps
U.S. Dollars floating to fixed 15,000 30,000 28,400 70,000 90,000 233,000 - 466,400 (48,557 )

6782

Expected maturity date	Expected maturity date																											Expected maturity date
		2009			2010			2011			2012			2013			There- after			Without maturity		Total 2008			Fair value 2008				2010			2011			2012			2013			2014			There-after			Without maturity		Total 2009			Fair value 2009
($ Equivalent in thousand)	($ Equivalent in thousand)																											($ Equivalent in thousand)
Mexican Peso																														29,196			11,278			1,944			1,145			-			-			-		43,563			46,226
Average fixed rate																														8.38	%		8.42	%		9.36	%		9.59	%		-			-			-		8.46	%
Peruvian Soles																														-			-			-			-			42,575			-			-		42,575			48,966
Average fixed rate																														-			-			-			-			6.50	%		-			-		6.50	%
Floating rate
U.S. Dollars																														494,995			281,264			189,280			200,000			-			-			-		1,165,539			1,147,296
Average floating rate																														1.16	%		1.80	%		0.61	%		1.49	%		-			-			-		1.28	%
Mexican Peso																														-			-			-			108,939			-			-			-		108,939			108,902
Average floating rate																														-			-			-			5.95	%		-			-			-		5.95	%

Interest Rate Swaps
U.S. Dollars fixed to floating																														30,000			20,600			5,000			90,000			73,000			135,000					353,600			(30,756	)
Average pay rate			8.50	%		7.46	%		8.88	%		8.62	%		9.83	%		8.21	%		-		8.58	%						7.46	%		8.77	%		10.00	%		9.83	%		9.00	%		7.69	%				8.58	%
Average receive rate			7.24	%		5.52	%		8.10	%		6.83	%		7.66	%		6.46	%		-		6.81	%						2.87	%		5.39	%		6.94	%		5.51	%		4.66	%		3.57	%				4.39	%
U.S. Dollars floating to fixed																																				20,000														20,000			(1,956	)
Average pay rate																																				5.94	%													5.94	%
Average receive rate																																				0.63	%													0.63	%

Cross Currency Swaps
Receive US Dollars			871			1,126			560			125			-			-			-		2,682			(263	)
Receive U.S. Dollars																														6,126			1,154			656			564			497			-			-		8,997			(294	)
U.S. Dollars fixed rate			4.17	%		4.17	%		4.17	%		4.19	%		-			-			-		4.17	%						5.62	%		7.04	%		7.04	%		7.04	%		7.04	%		-			-		5.98	%
U.S. Dollars floating rate																														2.15	%		2.27	%		2.88	%		3.82	%					-			-		2.36	%
Pay US Dollars			102			116			131			148			146,744			41,020			-		188,261			(40,901	)			-			-			-			147,242			41,020			-			-		188,262			(32,131	)
U.S. Dollars fixed rate			5.94	%		5.94	%		5.94	%		5.94	%		6.38	%		-			-		6.38	%						-			-			-			-			5.35	%		-			-		5.35	%
U.S. Dollars fixed rate			-			-			-			-			-			5.35	%		-		5.35	%
Pay Euro			871			1,126			560			125			-			-			-		2,682
Euro fixed rate			7.96	%		7.82	%		7.83	%		7.36	%		-			-			-		7.84	%
U.S. Dollars floating rate																														-			-			-			2.57	%		-			-			-		2.57	%
Receive Mexican Peso			102			116			131			148			146,744			-			-		147,241							-			-			-			147,242			-			-			-		147,242
Mexican peso fixed rate			16.10	%		16.10	%		16.10	%		16.10	%		9.63	%		-			-		9.65	%
Mexican Peso floating rate																														-			-			-			5.94	%										5.94	%
Pay Mexican Peso																														4,694			438			494			564			497								6,687
Mexican Peso fixed rate																														11.15	%		12.50	%		12.50	%		12.50	%		12.50	%							11.55	%
Receive Peruvian Soles			-			-			-			-			-			41,020			-		41,020							-			-			-			-			41,020			-			-		41,020
Peruvian Soles fixed rate			-			-			-			-			-			6.50	%				6.50	%						-			-			-			-			6.50	%							6.50	%
Pay Euro																														1,432			716			162			-			-			-			-		2,310
Euro floating rate																														2.30	%		2.27	%		2.25	%		-			-			-			-		2.29	%

Forward Currency Exchange Agreements																												Forward Currency Exchange Agreements
Receive U.S. Dollars/Pay Mexican Pesos			11,723			4,820			1,236			436			350			-			-		18,565			3,580				4,820			1,237			436			350			-			-			-		6,843			829
Average exchange rate			11.25			11.83			11.96			12.51			13.13			-			-		11.52							11.83			11.96			12.51			13.13			-			-			-		11.96
Pay U.S. Dollars/Receive Mexican Pesos			180			11			-			-			-			-			-		191			(4	)			11			-			-			-			-			-			-		11			(1	)
Average exchange rate			11.18			11.75			-			-			-			-			-		11.21							11.75			-			-			-			-			-			-		11.75
Pay U.S. Dollars/Receive Euro			84,673			-			-			-			-			-			-		84,673			(2,176	)
Average exchange rate			1.43			-			-			-			-			-			-		1.43
Pay U.S. Dollars/Receive Yen			40,132			-			-			-			-			-			-		40,132			4,201
Average exchange rate			100.12			-			-			-			-			-			-		100.12

TRADING
Trading Assets
Debt securities:
Fixed rate
U.S. Dollars			-			-			11,000			-			-			10,000			-		21,000			21,965
Average fixed rate			-			-			9.62	%		-			-			7.25	%		-		8.49	%
Forward repurchase agreements
U.S. Dollars			16,043			-			-			-			-			-			-		16,043			16,087
Average fixed rate			3.97	%		-			-			-			-			-			-		3.97	%
Retained interest on repurchase agreements			6,886			-			-			-			-			-			-		6,886			6,886
U.S. Dollars			8.10	%		-			-			-			-			-			-		8.10	%
Trading Liabilities
Interest rate swaps:
U.S. Dollars floating to fixed			-			-			59,527			-			90,700			25,000			-		175,227			14,065
Average pay rate			-			-			9.00	%		-			7.73	%		6.07	%		-		7.92	%
Average receive rate			-			-			8.17	%		-			6.27	%		5.37	%		-		6.79	%
Credit derivative:
U.S. Dollars			-			3,000			-			-			-			-			-		3,000			91
Average fixed rate			-			0.5	%		-			-			-			-			-		0.5	%

Expected maturity date
	2010			2011			2012			2013			2014		There-after		Without maturity		Total 2009			Fair value 2009
($ Equivalent in thousand)
U.S. Dollars		-			10,000			-			36,800			-		-		-		46,800			50,275
Average fixed rate		-			10.25	%		-			5.73	%		-		-		-		6.69	%
Credit derivative:
U.S. Dollars		3,000			-			-			-			-		-		-		3,000			2
Average fixed rate		0.50	%		-			-			-			-		-		-		0.50	%

Trading Liabilities
Interest rate swaps:
U.S. Dollars fixed to floating		-			10,000			-			36,800			-		-		-		46,800			(2,514	)
Average pay rate		-			10.25	%		-			5.73	%		-		-		-		6.69	%
Average receive rate					7.52	%		-			2.11	%		-		-		-		3.27	%
Cross currency swap:
Receive US Dollars		7,317			7,296			883			-			-		-		-		15,496			(638	)
U.S. Dollars floating rate		4.77	%		4.77	%		4.77	%		-			-		-		-		4.77	%
Pay Mexican Peso		7,317	��		7,296			883			-			-		-		-		15,496
Mexican Peso fixed rate		11.00	%		11.00	%		11.00	%		-			-		-		-		11.00	%

(1) U.S. Dollars floating rate loans include $35,750 of impaired loans.

(2) Borrowings and placements include securities sold under repurchase agreements and short and long-term borrowings and debt.

Although certain assets and liabilities may have similar maturities or periods of re-pricing, they may be impacted in varying degrees to changes in market interest rates. The maturity of certain types of assets and liabilities may fluctuate in advance of changes in market rates, while the maturity of other types of assets and liabilities may lag behind changes in market rates. In the event of a change in interest rates, prepayment and early withdrawal levels could deviate significantly from the maturities assumed in calculating the table above.

For information regarding the fair value disclosure of financial instruments, see Item 18, “Financial Statements,” note ~~23.~~22. For information regarding the fair value of trading assets and liabilities of the Fund, See Item 18, “Financial Statements,” notes 2(d) and 7.6.

Foreign Exchange Risk Management and Sensitivity

The Bank accepts deposits and raises funds principally in U.S. dollars, and makes loans mostly in U.S. dollars. Currency exchange risk arises when the Bank accepts deposits or raises funds in one currency and lends or invests the proceeds in another. In general, foreign currency-denominated assets are funded with liability instruments denominated in the same currency. In those cases where assets are funded in different currencies, forward foreign exchange or cross-currency swap contracts are used to fully hedge the risk resulting from this cross currency funding. During ~~2008,~~2009, the Bank did not hold significant open foreign exchange positions. The Fund invests in securities denominated in foreign currency, as well as forward foreign currency exchange contracts and cross currency swap contracts, all for trading purposes. AtAs of December 31, ~~2008,~~2009, the Bank had an equivalent of ~~$338~~$72 million in non-U.S. dollar financial assets and $195 million of non-U.S. dollar financial liabilities which ~~matched funded asset transactions~~are fully hedged.

Price Risk Management and Sensitivity

Price risk corresponds to the risk that arises from the volatility in the ~~same currency.~~price of the financial instruments held by the Bank, which may result from observed transaction prices that fluctuate freely according to supply and demand or from changes in the risk factors used for determining prices (interest rates, exchange rates, credit risk spreads, etc.). The table below lists the carrying amount and fair value of the investment securities portfolio and the interest rate swaps associated with this portfolio as of December 31, 2009.

	Carrying Amount			Fair Value
NON-TRADING ASSETS
Investment Securities
Investment available for sale		456,984			456,984
LIABILITIES
Interest rate swaps		(30,756	)		(30,756	)

TRADING ASSETS
Trading Assets		50,275			50,275
TRADING LIABILITIES
Interest rate swaps		(2,514	)		(2,514	)

Item 12.

Description of Securities Other than Equity Securities

Not applicable.

PART II

Item 13.

Defaults, Dividend Arrearages and Delinquencies

None.

Item 14.

Material Modifications to the Rights of Security Holders and Use of Proceeds

None.

Item 15.

Controls and Procedures

a) Disclosure Controls and Procedures

The Bank maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports it files under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms. Such controls include those designed to ensure that information for disclosure is accumulated and communicated to the members of the Board and ~~management,~~Management, as appropriate to allow timely decisions regarding required disclosure.

The ~~CEO~~Chief Executive Officer (the “CEO”) and the Chief Financial Officer (the “CFO”), evaluated the effectiveness of the Bank’s disclosure controls and procedures as of December 31, ~~2008. Refer to Item 18, Section c.~~

2009, and concluded that they were effective as of December 31, 2009.

b) Management’s Annual Report on Internal Control Over Financial Reporting (“ICFR”)

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such ~~term~~as is defined in Exchange Act Rule 13a-15(f) or 15d-15(f). ~~With~~Mangement, with the participation and supervision of the Bank’s CEO and CFO, ~~its management~~ has ~~assessed~~evaluated the effectiveness of its internal control over financial reporting as of December 31, ~~2008.~~2009.

The ~~assessment includes~~evaluation included the documentation and understanding of the Bank’s internal control over financial reporting. Management evaluated the effectiveness of the design ~~effectiveness~~ and tested the ~~operational~~operating effectiveness of internal controls over financial reporting on which to ~~form~~base its conclusion.

Management’s evaluation was based on the criteria set forth by the Internal Control-Integrated Framework of the Committee of Sponsoring Organizations of the Treadway Commission (COSO) ~~in Internal Control-Integrated Framework.~~.

Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. The Bank’s internal control over financial reporting includes those policies and procedures that:

(1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the Bank’s transactions and dispositions of its assets;

(2) provide reasonable assurance that transactions are recorded as necessary to permit the preparation of financial statements in accordance with generally accepted accounting principles, and that the Bank’s receipts and expenditures are being made only in accordance with authorizations of the Bank’s ~~management~~Management and the Board; and

(3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Bank’s assets that could have a material effect on its financial statements.

Because of its inherent limitations, internal control over financial reporting determined to be effective can provide only reasonable assurance with respect to financial statement preparation and may not prevent or detect all misstatements. Also, projections of any evaluation of the effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Policies, procedures and controls established to assess the risks over financial information related to: a) recognition as sales of securities of certain repurchase agreements in accordance with FASB Statement No. 140, and b) the fair value measurement of financial liabilities that resulted from certain hedging derivative contracts (forward contracts) due to the adoption of FASB Statement No.157, did not identify effectively if (i) the escalating credit and liquidity crisis of international markets in late 2008 as it relates to the application of FASB Statement No. 140 and (ii) the implementation of the new accounting standard FASB Statement No. 157, impacted the effectiveness of existing policies, procedures and controls over financial information, or required changes in their design. As a result,Based on this assessment, the Bank’s ~~policies, procedures and financial controls related to the two items discussed above were not modified in response to the rapid deterioration~~Management concluded that, as of liquidity in the market regarding repurchase agreements with respect to FASB Statement No. 140 or designed appropriately with respect to the fair value of financial liabilities under certain hedging derivative contracts under FASB Statement No. 157, and thus were ineffective at December 31, 2008. This material weakness resulted in an audit adjustment to recognize a net charge to results in the fourth quarter of 2008 in the amount of $13 million. See Item 5, “Operating and Financial Review and Prospects/Operating Results/Net Income.”

~~As a result of the specified weakness regarding certain aspects related to FASB Statement No. 140 and FASB Statement No. 157, the CEO and CFO have concluded that the Bank’s~~2009, our internal control over financial reporting was ~~not~~ effective ~~as of December 31, 2008. No other material weaknesses, other than the aforementioned, that may expose the Bank to financial information risks at such date.~~

based on those criteria.

~~c) Attestation Report of the Registered Public Accounting Firm~~

The Company’s independent registered public accounting firm, Deloitte Inc, has issued an attestation report on the effectiveness of the Bank’s internal control over financial reporting.

c) Attestation Report of the Registered Public Accounting Firm

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

Banco Latinoamericano de Comercio Exterior, S.A. and Subsidiaries

We have audited the internal control over financial reporting ~~which~~of Banco Latinoamericano de Comercio Exterior, S.A. and Subsidiaries (the "Bank") as of December 31, 2009, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Bank's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in ~~Item 18, “Financial Statements”~~Management’s Annual Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Bank's internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company's internal control over financial reporting is a process designed by, or under the supervision of, the company's principal executive and principal financial officers, or persons performing similar functions, and effected by the company's board of directors, management, and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of the effectiveness of the internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the Bank maintained, in all material respects, effective internal control over financial reporting as of December 31, 2009, based on the criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated financial statements as of and for ~~reference.~~the year ended December 31, 2009 of Banco Latinoamericano de Comercio Exterior, S.A. and Subsidiaries and our report dated March 15, 2010 expressed an unqualified opinion on those financial statements.

/s/ Deloitte, Inc.

March 15, 2010

Panama, Republic of Panama

d) Changes in Internal Controls

There has been no change in the Bank’s internal control over financial reporting during the fiscal year ended December 31, ~~2008~~2009 that has materially affected, or is reasonably likely to materially affect, its internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange ~~Act. During~~Act, except for the ~~first quarter of 2009,~~situations identified as material weaknesses reported for the ~~Bank’s management has taken necessary actions in order to remediate the material weakness, through revisions improving its accounting policies and procedures related~~fiscal year 2008 relating to the ~~recognition~~accounting of certain repurchase agreements (repos) and the measurement of fair value for financial instruments, which were remedied through the ~~types~~implementation of ~~transactions involved, as well as providing training to reinforce~~ the monitoring of this types of transactions. In addition, the Bank’s management has performed self-assessments using checklists and has carried effectiveness tests to determine that the new controls implemented are being executed in an effective manner.following measures:

~~Item 16.~~

~~[Reserved]~~·

Approval of the policies and procedures to establish the necessary controls to properly record asset transfer transactions that qualify as sales or secured financing based on Financial Accounting Standards Board (“FASB”) Accounting Standard Codification (“ASC”) 860 – Transfer and Servicing, and the terms used by the Bank to value financial instruments based on ASC 820 – Fair Value Measurements and Disclosures.

Periodic testing was carried out to verify compliance with the controls established in the policies and procedures mentioned in the previous point.

A time period was established to timely analyze the effect of different accounting standards on the range of the Bank’s products and services.

Training was provided to the staff in charge of managing repos and valuation of financial instruments in order to timely detect if any transactions fall outside the established parameters.

~~Item 16A.~~

Item 16. [Reserved]

Item 16A. Audit and Compliance Committee Financial Expert

The Board has determined that at least one member of the Audit and Compliance Committee is a “financial expert,” as defined in the rules enacted by the ~~SEC~~Commission under the Sarbanes-Oxley Act. The Audit and Compliance Committee’s financial expert is Mr. Gonzalo Menéndez Duque. Mr. Gonzalo Menéndez Duque is independent as defined by NYSE rules.

~~Item 16B.~~

Item 16B. Code of Ethics

The Bank has adopted a ~~code~~Code of ~~ethics~~Ethics that applies to the Bank’s principal executive officers, ~~and~~ principal financial and principal accounting officers. The Bank’s Code of Ethics includes the information regarding its corporate governance practices necessary to comply with Section 303A of the NYSE Rules. A copy of the Bank’s Code of Ethics is filed as Exhibit 14.1 to this Annual Report on Form 20-F.~~Stockholders may request a hard copy of the Bank’s Code of Ethics, free of charge, from the following contact:~~

~~Mr. Jaime Celorio~~

~~Chief Financial Officer~~

~~Banco Latinoamericano de Comercio Exterior, S.A. (Bladex)~~

~~Tel.: (507) 210-8630~~

~~Fax: (507) 269-6333~~

~~e-mail:~~ ~~jcelorio@bladex.com~~Item 16C. Principal Accountant Fees and Services

~~Item 16C.~~

~~Principal Accountant Fees and Services~~

The following table summarizes the fees paid or accrued by the Bank for audit and other services provided by Deloitte, Inc., the Bank’s independent accounting firm, for each of the years ended December 31, ~~2007~~2009 and 2008:

	2008		2007
					2009		2008
Audit fees	$	482,000	$	426,495	$	565,000	$	482,000
Tax fees		0		0
Audit-Related fees					$	93,500		0
All other fees		71,000		39,509		0	$	71,000
Total	$	553,000	$	466,004	$	658,500	$	553,000

The following is a description of the type of services included within the categories listed above:

Audit fees include aggregate fees billed for professional services rendered by Deloitte, Inc. for the audit of the Bank’s annual financial statements and services that are normally provided in connection with statutory and regulatory filings or engagements.

Audit – related fees include, in 2009, aggregate fees billed for professional services rendered by Deloitte, Inc. related to the application of FASB ASC Topic 860. During 2008 ~~and 2007,~~ no audit-related fees were paid by the Bank.

~~Tax fees include aggregate fees billed for professional services for tax compliance, tax advice and tax planning.~~

All other fees include aggregate fees billed for ~~products and~~ services provided by Deloitte, Inc. to the Bank, other than the services described in the two preceding paragraphs. Other fees in 2008 included fees billed in connection with the application of the AICPA Investment Guide and reimbursements of travel expenses to Deloitte, Inc.

Audit and Compliance Committee Pre-Approval Policies and Procedures

The Audit and Compliance Committee pre-approves all audit and non-audit services to be provided to the Bank by the Bank’s independent accounting firm. All of the services related to the audit fees, audit-related fees, tax fees and all other fees described above were approved by the Audit and Compliance ~~Comitte.~~Committee.

Item 16D.

Exemptions from the Listing Standards for Audit Committees

Not applicable.

Item 16E.

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

Not applicable.

Item 16F.

Change in Registrant’s Certifying Accountant

Not applicable.

Item 16G.

Corporate Governance

There are two significant differences between the corporate governance practices of the Bank and those required by the NYSE for domestic companies in the United States.

First, under Section 303A.04 of the NYSE Rules, a listed company must have a nomination/corporate governance committee comprised entirely of independent directors. However, it is common practice among public companies in Panama not to have a corporate governance committee. The Bank addresses all corporate governance matters in plenary meetings of the Board, and the Audit and Compliance Committee has been given the responsibility of improving the Bank’s corporate governance practices and monitoring compliance with such practices.

Second, under Section 303A.08 of the NYSE Rules, stockholders must approve all equity compensation plans and material revisions to such plans, subject to limited exceptions. However, under Panamanian law, any contracts, agreements and transactions between the Bank and one or more of its directors or officers, or companies in which they have an interest, only need to be approved by the Board, including equity compensation plans. The Board ~~though~~ must inform stockholders of the equity compensation plans and/or material revisions to such plans at the next stockholders’ meeting. In addition, stockholders may revoke the Board’s approval of the equity compensation plans and/or material revisions to such plans at a meeting, if there is adequate justification and whenever convenient, by invoking the fiduciary duty of the directors that approved such plans and/or revisions.

PART III

Item 17.

Financial Statements

The Bank is providing the financial statements and related information specified in Item 18.

Item 18.

Financial Statements

List of Consolidated Financial Statements

~~Reports~~Report of Independent Registered Public Accounting ~~Firms~~Firm	F-3
Consolidated Balance Sheets atas of December 31, ~~2008~~2009 and ~~2007~~2008	~~F-6~~F-4
Consolidated Statements of Income for the Years Ended December 31, 2009, 2008 ~~2007~~ and ~~2006~~2007	~~F-7~~F-5
Consolidated Statements of Changes in Stockholders’ Equity and Redeemable Noncontrolling Interest in the Investment Fund for the Years Ended December 31, 2009, 2008 ~~2007~~ and ~~2006~~2007	~~F-8~~F-6
Consolidated Statements of Comprehensive Income (Loss) for the Years Ended December 31, 2009, 2008 ~~2007~~ and ~~2006~~2007	~~F-9~~F-7
Consolidated Statements of Cash Flows for the Years Ended December 31, 2009, 2008 ~~2007~~ and ~~2006~~2007	~~F-10~~F-8
Notes to Consolidated Financial Statements	~~F-11~~F-9

~~Item 19.~~

~~Exhibits~~

~~List of Exhibits~~

~~Exhibit 1.1.~~

~~Amended and Restated Articles of Incorporation~~

~~Exhibit 1.2.~~

By-Laws*

~~Exhibit 12.1.~~

~~Rule 13a-14(a) Certification of Principal Executive Officer~~

~~Exhibit 12.2.~~

~~Rule 13a-14(a) Certification of Principal Financial Officer~~

~~Exhibit 13.1.~~

~~Rule 13a-14(b) Certification of Principal Executive Officer~~

~~Exhibit 13.2.~~

~~Rule 13a-14(b) Certification of Principal Financial Officer~~

~~Exhibit 14.1.~~

Code of Ethics**

*	~~Filed as an exhibit to the Form 20-F for the fiscal year ended December 31, 2002 filed with the SEC on February 24, 2003.~~

**	~~Filed as an exhibit to the Form 20-F for the fiscal year ended December 31, 2007 filed with the SEC on June 20, 2008.~~

~~SIGNATURES~~

~~The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.~~

~~BANCO LATINOAMERICANO DE COMERCIO EXTERIOR, S.A.~~

~~/s/ JAIME RIVERA~~

~~Jaime Rivera~~

~~Chief Executive Officer~~

~~June 26, 2009~~

7489

Banco Latinoamericano

de ~~Exportaciones,~~Comercio Exterior, S. A.

and Subsidiaries

With Reports of Independent Registered

Public Accounting Firm

Consolidated Balance Sheets as of December 31, 2009 and 2008, ~~and 2007,~~

and Related Consolidated Statements of Income, Stockholders’

Equity, Comprehensive Income (Loss) and Cash Flows for Each of the

Three Years in the Period Ended December 31, ~~2008~~2009

~~Deloitte-Panamá~~

F-1

Banco Latinoamericano de ~~Exportaciones,~~Comercio Exterior, S. A.

and Subsidiaries

~~Independent Auditors’ Report and~~

Consolidated Financial Statements 2009, 2008 ~~2007~~ and ~~2006~~2007

Contents	Pages

Report of Independent Registered Public Accounting Firm -– Consolidated Financial Statements		F-3

Consolidated balance sheets		~~F-6~~F-4

Consolidated statements of income		~~F-7~~F-5

Consolidated statements of changes in stockholders’ equity and redeemable noncontrolling interest in the investment fund		~~F-8~~F-6

Consolidated statements of comprehensive income (loss)		~~F-9~~F-7

Consolidated statements of cash flows		~~F-10~~F-8

Notes to consolidated financial statements		~~F-11~~

~~Report of Independent Registered Public Accounting Firm~~F-9 – ~~Internal Control Over Financial Reporting~~		~~F-62~~F-57

F-2

	Deloitte, Inc.
	Contadores Públicos Autorizados
	Apartado 0816-01558
~~Panam~~á	Panamá, Rep. de Panamá

	Teléfono: (507) 303-4100
	Facsimile : (507) 269-2386
	infopanama@deloitte.com
	www.deloitte.com/pa

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

Banco Latinoamericano de ~~Exportaciones,~~Comercio Exterior, S.A. and Subsidiaries

We have audited the accompanying consolidated balance sheets of Banco Latinoamericano de ~~Exportaciones,~~Comercio Exterior, S.A. and ~~subsidiaries~~Subsidiaries (the “~~Bank~~”“Bank”) as of December 31, ~~2008~~2009 and ~~2007,~~2008, and the related consolidated statements of income, changes in ~~stockholders~~’stockholders’ equity and redeemable noncontrolling interest in the investment fund, comprehensive income (loss) and cash flows for each of the three years ~~then ended.~~in the period ended December 31, 2009. These financial statements are the responsibility of the Bank’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Banco Latinoamericano de ~~Exportaciones,~~Comercio Exterior, S.A. and ~~subsidiaries~~Subsidiaries as of December 31, 2009 and 2008, and ~~2007, and~~ the consolidated results of their operations and their cash flows for each of the three years ~~then~~in the period ended December 31, 2009, in conformity with accounting principles generally accepted in the United States of America.

As discussed in Note 3 to the consolidated financial statements, in 2008 the Bank’s subsidiary, Bladex Offshore Feeder Fund, began to account for its investment in the Bladex Capital Growth Fund using the specialized accounting for investment companies in the American Institute of Certified Public Accountants Audit and Accounting Guide for Investment Companies. The Bank maintained this specialized accounting in its consolidated financial statements. This change was accounted for as a change in reporting entity on a retrospective basis.

~~Auditoría~~ . ~~Impuestos~~ . ~~Consultoría~~ . ~~Asesoría Financiera.~~

~~A member firm of~~

~~Deloitte Touche Tohmatsu~~

~~F-3~~

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the Bank’s internal control over financial reporting as of December 31, ~~2008,~~2009, based on the criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March ~~16, 2009~~15, 2010 expressed an ~~adverse~~unqualified opinion on the Bank’s internal control over financial ~~reporting because of a material weakness.~~reporting.

The accompanying consolidated financial statements have been translated into English for the convenience of readers outside of Panama.

~~(Signed by Deloitte)~~/s/ Deloitte

March ~~16, 2009~~15, 2010

~~Panama, Republic~~

Auditoria. Impuestos. Consultoria. Asesoria Financiera.

A member firm of

Deloitte Touche Tohmatsu

F-3

Banco Latinoamericano de Comercio Exterior, S. A. and Subsidiaries

Consolidated balance sheets

December 31, 2009 and 2008

(in US$ thousand, except share amounts)

	Notes	2009			2008
Assets
Cash and due from banks	3,22		2,961			11,474
Interest-bearing deposits in banks (including pledged deposits of $22,582 in 2009 and $75,004 in 2008)	3,22		421,595			889,119
Trading assets (including pledged securities of $10,250 in 2008)	4,22		50,277			44,939
Securities available-for-sale (including pledged securities of $78,512 in 2009 and $479,724 in 2008)	5,22		456,984			607,918
Securities held-to-maturity (fully pledged, market value of $28,144 in 2008)	5,22		-			28,410
Investment fund	6,22		197,575			150,695
Loans	7,22		2,779,262			2,618,643
Less:
Allowance for loan losses	8,22		73,789			54,648
Unearned income and deferred fees			3,989			4,689
Loans, net			2,701,484			2,559,306

Customers' liabilities under acceptances	22		1,551			1,375
Premises and equipment (net of accumulated depreciation and amortization of $14,290 in 2009 and $11,594 in 2008)	9		7,749			7,970
Accrued interest receivable	22		25,561			46,319
Derivative financial instruments used for hedging - receivable	20,22		828			7,777
Other assets	10		12,206			7,376
Total assets			3,878,771			4,362,678

Liabilities and stockholders' equity
Deposits:	11,22
Noninterest-bearing - Demand			788			718
Interest-bearing - Demand			50,587			112,304
Time			1,204,871			1,056,026
Total deposits			1,256,246			1,169,048

Trading liabilities	4,22		3,152			14,157
Securities sold under repurchase agreement	3,4,5,12,22		71,332			474,174
Short-term borrowings	13,22		327,800			738,747
Borrowings and long-term debt (including $529,110 in 2009 and $210,280 in 2008 with remaining maturity within a year)	14,22		1,390,387			1,204,952
Acceptances outstanding	22		1,551			1,375
Accrued interest payable	22		11,291			32,956
Derivative financial instruments used for hedging - payable	20,22		65,137			91,897
Reserve for losses on off-balance sheet credit risk	8		27,261			30,724
Other liabilities			14,077			25,635
Total liabilities			3,168,234			3,783,665

Commitments and contingencies	18,19,20,23

Redeemable noncontrolling interest in the investment fund			34,900			4,689

Stockholders' equity:	15,16,17,21,24
"Class A" common stock, no par value, assigned value of $6.67 (Authorized 40,000,000; outstanding 6,342,189)			44,407			44,407
"Class B" common stock, no par value, assigned value of $6.67 (Authorized 40,000,000; outstanding 2,584,882 in 2009 and 2,617,784 in 2008)			21,099			21,241
"Class E" common stock, no par value, assigned value of $6.67 (Authorized 100,000,000; outstanding 27,618,545 in 2009 and 27,453,115 in 2008)			214,474			214,332
Additional paid-in capital in excess of assigned value of common stock			134,820			135,577
Capital reserves			95,210			95,210
Retained earnings			301,389			268,435
Accumulated other comprehensive loss	5,20,21		(6,160	)		(72,115	)
Treasury stock	15		(129,602	)		(132,763	)
Total stockholders' equity			675,637			574,324

Total liabilities and stockholders' equity			3,878,771			4,362,678

The accompanying notes are part of ~~Panama~~these consolidated financial statements.

F-4

	~~KPMG~~	~~Tel~~é~~fono: (507) 208-0700~~Banco Latinoamericano de Comercio Exterior, S. A. and Subsidiaries
~~Apartado Postal 816-1089~~	~~Fax: (507) 263-9852~~
~~Panam~~á ~~5, Rep~~ú~~blica de Panam~~á Consolidated statements of income
~~Internet: www.kpmg.com~~Years ended December 31, 2009, 2008 and 2007
(in US$ thousand, except per share amounts)

~~Report of Independent Registered Public Accounting Firm~~

~~The Board of Directors and Stockholders~~
~~Banco Latinoamericano de Exportaciones, S. A.:~~

We have audited the accompanying consolidated statements of income, changes in stockholders’ equity, comprehensive income, and cash flows of Banco Latinoamericano de Exportaciones, S. A. and subsidiaries for the year ended December 31, 2006. These consolidated financial statements are the responsibility of the Bank’~~s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit.~~

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the results of operations and the cash flows of Banco Latinoamericano de Exportaciones, S. A. and subsidiaries for the year ended December 31, 2006, in conformity with U.S. generally accepted accounting principles.

~~February 28, 2007~~

~~Panama, Republic of Panama~~

	Notes	2009			2008			2007
Interest income:	20
Deposits with banks			1,260			7,574			12,729
Trading assets			7,158			648			-
Investment securities:
Available-for-sale			17,267			31,745			19,595
Held-to-maturity			190			746			1,337
Investment fund			1,763			3,485			9,587
Loans			114,326			200,045			221,621
Total interest income			141,964			244,243			264,869
Interest expense:	20
Deposits			11,493			44,364			70,443
Investment fund			2,325			2,296			4,197
Short-term borrowings			23,729			63,239			70,244
Borrowings and long-term debt			39,665			56,497			49,415
Total interest expense			77,212			166,396			194,299
Net interest income			64,752			77,847			70,570

Reversal (provision) for loan losses	8		(18,293	)		18,540			(11,994	)

Net interest income, after reversal (provision) for loan losses			46,459			96,387			58,576

Other income (expense):
Reversal (provision) for losses on off-balance sheet credit risk	8		3,463			(16,997	)		13,468
Fees and commissions, net			6,733			7,252			5,555
Derivative financial instruments and hedging	20		(2,534	)		9,956			(989	)
Impairment of assets, net of recoveries			(120	)		(767	)		(500	)
Net gain from investment fund trading			24,997			21,357			23,878
Net gain (loss) from trading securities	12		13,113			(20,998	)		(12	)
Net gain on sale of securities available-for-sale	5		546			67			9,119
Gain (loss) on foreign currency exchange			613			(1,596	)		115
Other income (expense), net			912			656			(6	)
Net other income (expense)			47,723			(1,070	)		50,628

Operating expenses:
Salaries and other employee expenses			20,201			20,227			22,049
Depreciation, amortization and impairment of premises and equipment			2,671			3,720			2,555
Professional services			3,262			3,765			3,181
Maintenance and repairs			1,125			1,357			1,188
Expenses from the investment fund			3,520			2,065			381
Other operating expenses			7,423			8,856			7,673
Total operating expenses			38,202			39,990			37,027

Net income			55,980			55,327			72,177

Net income attributable to the redeemable noncontrolling interest			1,118			208			-
						��
Net income attributable to Bladex			54,862			55,119			72,177

Basic earnings per share	17		1.50			1.51			1.99

Diluted earnings per share	17		1.50			1.51			1.98

Weighted average basic shares	17		36,493			36,388			36,349

Weighted average diluted shares	17		36,571			36,440			36,414

The accompanying notes are part of these consolidated financial statements.

F-5

~~Banco Latinoamericano de Exportaciones, S. A.~~

Banco Latinoamericano de Comercio Exterior, S. A. and Subsidiaries

Consolidated statements of changes in stockholders' equity and redeemable noncontrolling interest in the investment fund

Years ended December 31, 2009, 2008 and 2007

(in US$ thousand)

~~Consolidated balance sheets~~

~~December 31, 2008 and 2007~~

~~(in US$ thousand, except share amounts)~~

Notes 2008 2007
Assets
Cash and due from banks 4,23 11,474 596
Interest-bearing deposits in banks (including pledged deposits of $75,004 in 2008 and $5,500 in 2007) 4,23 889,119 400,932
Trading assets (including pledged assets of $21,965 in 2008) 5,23 44,939 -
Securities available-for-sale (including pledged securities of $479,724 in 2008 and $322,926 in 2007) 6,23 607,918 468,360
Securities held-to-maturity (market value of $28,144 in 2008) (including pledged securities of $28,410 in 2008) 6,23 28,410 -
Investment fund 7,23 150,695 81,846
Loans 8,23 2,618,643 3,731,838
Less:
Allowance for loan losses 9,23 54,648 69,643
Unearned income and deferred fees 4,689 5,961
Loans, net 2,559,306 3,656,234

Customers' liabilities under acceptances 23 1,375 9,104
Premises and equipment (net of accumulated depreciation and amortization of $11,594 in 2008 and $9,704 in 2007) 10 7,970 10,176
Accrued interest receivable 23 46,319 62,375
Derivative financial instruments used for hedging - receivable 21,23 7,777 122
Other assets 11 7,376 8,826
Total assets 3 4,362,678 4,698,571

Liabilities and stockholders' equity

Deposits: 12,23
Noninterest-bearing - Demand 718 890
Interest-bearing - Demand 112,304 110,606
Time 1,056,026 1,350,875
Total deposits 1,169,048 1,462,371

Trading liabilities 5,23 14,157 13
Securities sold under repurchase agreements 4,5,6,13,23 474,174 283,210
Short-term borrowings 14,23 738,747 1,221,500
Borrowings and long-term debt 15,23 1,204,952 1,010,316
Acceptances outstanding 23 1,375 9,104
Accrued interest payable 23 32,956 38,627
Derivative financial instruments used for hedging - payable 21,23 91,897 16,899
Reserve for losses on off-balance sheet credit risk 9 30,724 13,727
Other liabilities 25,635 30,553
Total liabilities 3 3,783,665 4,086,320

Commitments and contingent liabilities 11,19,20,21,24

Minority interest in the investment fund 4,689 -

Stockholders' equity: 16,17,18,22,25
Class "A" common stock, no par value, assigned value of $6.67 (Authorized 40,000,000; outstanding 6,342,189) 44,407 44,407
Class "B" common stock, no par value, assigned value of $6.67 (Authorized 40,000,000; outstanding 2,617,784 in 2008 and 2,660,847 in 2007) 21,241 21,528
Class "E" common stock, no par value, assigned value of $6.67 (Authorized 100,000,000; outstanding 27,453,115 in 2008 and 27,367,113 in 2007) 214,332 214,045
Additional paid-in capital in excess of assigned value of common stock 135,577 135,142
Capital reserves 95,210 95,210
Retained earnings 268,435 245,348
Accumulated other comprehensive loss 6,22 (72,115 ) (9,641 )
Treasury stock 16 (132,763 ) (133,788 )
Total stockholders' equity 574,324 612,251

Total liabilities and stockholders' equity 4,362,678 4,698,571

	Stockholders' equity
			Additional
			paid-in capital
			in excess of								Accumulated									Redeemable
			assigned value								other						Total			noncontrolling
	Common		of common			Capital		Retained			comprehensive			Treasury			stockholders'			interest in the
	stock		stock			reserves		earnings			income (loss)			stock			equity			investment fund

Balances at January 1, 2007		279,980		134,945			95,210		205,200			3,328			(134,768	)		583,895			-
Net income		-		-			-		72,177			-			-			72,177			-
Other comprehensive loss		-		-			-		-			(12,969	)		-			(12,969	)		-
Compensation cost - stock options plans		-		1,130			-		-			-			-			1,130			-
Issuance of restricted stock		-		(644	)		-		-			-			531			(113	)		-
Exercised options		-		(289	)		-		-			-			449			160			-
Dividends declared		-		-			-		(32,029	)		-			-			(32,029	)		-
Balances at December 31, 2007		279,980		135,142			95,210		245,348			(9,641	)		(133,788	)		612,251			-
Net income		-		-			-		55,119			-			-			55,119			208
Redeemable noncontrolling interest - subscriptions		-		-			-		-			-			-			-			6,000
Redeemable noncontrolling interest - redemptions		-		-			-		-			-			-			-			(1,519	)
Other comprehensive loss		-		-			-		-			(62,474	)		-			(62,474	)		-
Compensation cost - stock options and stock units plans		-		1,033			-		-			-			-			1,033			-
Issuance of restricted stock		-		(484	)		-		-			-			745			261			-
Exercised options		-		(114	)		-		-			-			280			166			-
Dividends declared		-		-			-		(32,032	)		-			-			(32,032	)		-
Balances at December 31, 2008		279,980		135,577			95,210		268,435			(72,115	)		(132,763	)		574,324			4,689
Net income		-		-			-		54,862			-			-			54,862			1,118
Redeemable noncontrolling interest - subscriptions		-		-			-		-			-			-			-			32,090
Redeemable noncontrolling interest - redemptions		-		-			-		-			-			-			-			(2,997	)
Other comprehensive income		-		-			-		-			65,955			-			65,955			-
Compensation cost - stock options and stock units plans		-		1,596			-		-			-			-			1,596			-
Issuance of restricted stock		-		(905	)		-		-			-			905			-			-
Exercised options and stock units vested		-		(1,448	)		-		-			-			2,256			808			-
Dividends declared		-		-			-		(21,908	)		-			-			(21,908	)		-
Balances at December 31, 2009		279,980		134,820			95,210		301,389			(6,160	)		(129,602	)		675,637			34,900

The accompanying notes are part of these consolidated financial statements.

F-6

~~Banco Latinoamericano de Exportaciones,~~

Banco Latinoamericano de Comercio Exterior, S. A. and Subsidiaries

Consolidated statements of comprehensive income (loss)

Years ended December 31, 2009, 2008 and 2007

(in US$ thousand)

~~and Subsidiaries~~

~~Consolidated statements of income~~

~~Years ended December 31, 2008, 2007 and 2006~~

~~(in US$ thousand, except per share amounts)~~

Notes 2008 2007 2006
Interest income:
Deposits with banks 7,574 12,729 6,035
Trading assets 648 - -
Investment securities:
Available-for-sale 31,745 19,595 16,780
Held-to-maturity 746 1,337 5,985
Investment fund 3,485 9,587 8,748
Loans 200,045 221,621 165,802
Total interest income 244,243 264,869 203,350
Interest expense:
Deposits 44,364 70,443 56,611
Investment fund 2,296 4,197 4,639
Short-term borrowings 63,239 70,244 55,000
Borrowings and long-term debt 56,497 49,415 28,263
Total interest expense 166,396 194,299 144,513
Net interest income 77,847 70,570 58,837

Reversal (provision) for loan losses 9 18,540 (11,994 ) (11,846 )
Net interest income, after reversal (provision) for loan losses 96,387 58,576 46,991

Other income (expense):
Reversal (provision) for losses on off-balance sheet credit risk 9 (16,997 ) 13,468 24,891
Fees and commissions, net 7,252 5,555 6,393
Derivative financial instruments and hedging 21 9,956 (989 ) (225 )
Recoveries on assets, net of impairments 6,11 (767 ) (500 ) 5,551
Net gain (loss) from investment fund trading 21,357 23,878 1,091
Net gain (loss) from trading securities 13 (20,998 ) (12 ) (212 )
Net gain on sale of securities available-for-sale 6 67 9,119 2,568
Gain (loss) on foreign currency exchange (1,596 ) 115 (253 )
Other income (expense), net 656 (6 ) 36
Net other income (expense) (1,070 ) 50,628 39,840

Operating expenses:
Salaries and other employee expenses 20,227 22,049 16,826
Depreciation, amortization and impairment of premises and equipment 10 3,720 2,555 1,406
Professional services 3,765 3,181 2,671
Maintenance and repairs 1,357 1,188 1,000
Expenses from the investment fund 2,065 381 -
Other operating expenses 8,856 7,673 7,026
Total operating expenses 39,990 37,027 28,929

Income before participation of the minority interest in gains of the investment fund 55,327 72,177 57,902

Participation of the minority interest in gains of the investment fund (208 ) - -

Net income 55,119 72,177 57,902

Basic earnings per share 1.51 1.99 1.56

Diluted earnings per share 1.51 1.98 1.54

Average basic shares 18 36,388 36,349 37,065

Average diluted shares 18 36,440 36,414 37,572

	Notes	2009			2008			2007

Net income			55,980			55,327			72,177

Other comprehensive income (loss)

Unrealized gains (losses) on securities available-for-sale:
Unrealized gains (losses) arising from the year	21		63,556			(58,453	)		(1,912	)
Less: reclassification adjustments for net gains included in net income	21		(649	)		(67	)		(9,119	)

Net change in unrealized gains (losses) on securities available-for-sale			62,907			(58,520	)		(11,031	)

Unrealized gains (losses) on derivative financial instruments:
Unrealized gains (losses) arising from the year	21		1,971			(2,433	)		(2,081	)
Less: reclassification adjustments for net (gains) losses included in net income	21		1,077			(1,521	)		143
Net change in unrealized gains (losses) on derivative financial instruments			3,048			(3,954	)		(1,938	)

Other comprehensive income (loss)			65,955			(62,474	)		(12,969	)

Comprehensive income (loss)			121,935			(7,147	)		59,208

Comprehensive income (loss) attributable to the redeemable noncontrolling interest			1,118			208			-

Comprehensive income (loss) attributable to Bladex			120,817			(7,355	)		59,208

The accompanying notes are part of these consolidated financial statements.

F-7

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Consolidated statements of changes in stockholders' equity~~

~~Years ended December 31, 2008, 2007 and 2006~~

~~(in US$ thousand)~~

Banco Latinoamericano de Comercio Exterior, S. A. and Subsidiaries

Consolidated statements of cash flows

Years ended December 31, 2009, 2008 and 2007

(in US$ thousand)

Accumulated
Additional other Total
Common paid-in Capital Retained comprehensive Treasury stockholders’
stock capital reserves earnings income (loss) stock equity

Balances at January 1, 2006 279,979 134,340 95,210 212,916 619 (106,282 ) 616,782
Net income - - - 57,902 - - 57,902
Other comprehensive income - - - - 2,709 - 2,709
Compensation cost - indexed stock option plan - 606 - - - - 606
Issuance of restricted stock - - - (49 ) - 144 95
Exercised stock options pursuant to compensation plan - - - (14 ) - 27 13
Repurchase of Class "E" common stock - - - - - (28,657 ) (28,657 )
Difference in fractional shares in conversion of common stocks 1 (1 ) - - - - -
Dividends declared - - - (65,555 ) - - (65,555 )
Balances at December 31, 2006 279,980 134,945 95,210 205,200 3,328 (134,768 ) 583,895
Net income - - - 72,177 - - 72,177
Other comprehensive loss - - - - (12,969 ) - (12,969 )
Compensation cost - indexed stock option plan - 1,130 - - - - 1,130
Issuance of restricted stock - (644 ) - - - 531 (113 )
Exercised stock options pursuant to compensation plan - (289 ) - - - 449 160
Dividends declared - - - (32,029 ) - - (32,029 )
Balances at December 31, 2007 279,980 135,142 95,210 245,348 (9,641 ) (133,788 ) 612,251
Net income - - - 55,119 - - 55,119
Other comprehensive loss - - - - (62,474 ) - (62,474 )
Compensation cost - stock option and restricted stock unit plans - 1,033 - - - - 1,033
Issuance of restricted stock - (484 ) - - - 745 261
Exercised stock options pursuant to compensation plan - (114 ) - - - 280 166
Dividends declared - - - (32,032 ) - - (32,032 )
Balances at December 31, 2008 279,980 135,577 95,210 268,435 (72,115 ) (132,763 ) 574,324

	2009			2008			2007
Cash flows from operating activities:
Net income		55,980			55,327			72,177
Adjustments to reconcile net income to net cash provided by operating activities:
Activities of derivative financial instruments and hedging		1,391			30,198			1,258
Depreciation, amortization and impairment of premises and equipment		2,671			3,720			2,555
Provision (reversal) for loan losses		18,293			(18,540	)		11,994
Provision (reversal) for losses on off-balance sheet credit risk		(3,463	)		16,997			(13,468	)
Impairment loss on assets		120			767			500
Net gain on sale of securities available-for-sale		(546	)		(67	)		(9,119	)
Compensation cost - compensation plans		1,596			1,033			1,130
Issuance of restricted stock		-			261			(113	)
Exercised deferred compensation units		-			15			-
Amortization of premium and discounts on investments		9,382			12,115			6,268
Net decrease (increase) in operating assets:
Trading assets		(5,338	)		(1,355	)		-
Investment fund		(46,880	)		(68,849	)		23,353
Accrued interest receivable		20,758			16,056			(9,887	)
Other assets		(5,126	)		683			(2,583	)
Net increase (decrease) in operating liabilities:
Trading liabilities		(11,005	)		14,144			13
Accrued interest payable		(21,665	)		(5,671	)		11,332
Other liabilities		1,303			(6,088	)		3,631
Net cash provided by operating activities		17,471			50,746			99,041

Cash flows from investing activities:
Net decrease (increase) in pledged deposits		52,422			(69,504	)		-
Net decrease (increase) in loans		(160,471	)		1,089,851			(864,971	)
Proceeds from the sale of loans		-			25,617			121,824
Acquisition of premises and equipment		(2,450	)		(1,514	)		(1,595	)
Proceeds from the redemption of securities available-for-sale		-			58,074			19,074
Proceeds from the maturity of securities held-to-maturity		28,275			-			125,000
Proceeds from the sale of securities available-for-sale		196,980			229,877			578,697
Purchases of investment securities		(9,994	)		(536,880	)		(716,472	)
Net cash provided by (used in) investing activities		104,762			795,521			(738,443	)

Cash flows from financing activities:
Net increase (decrease) in due to depositors		87,198			(293,323	)		406,094
Net decrease in short-term borrowings and securities sold under repurchase agreements		(813,789	)		(291,789	)		(90,894	)
Proceeds from borrowings and long-term debt		335,598			631,099			613,126
Repayments of borrowings and long-term debt		(150,163	)		(436,463	)		(161,670	)
Dividends paid		(34,593	)		(30,862	)		(29,713	)
Subscriptions of redeemable noncontrolling interest in the investment fund		32,090			6,000			-
Redemptions of redeemable noncontrolling interest in the investment fund		(2,997	)		(1,519	)		-
Exercised stock options		808			151			160
Net cash (used in) provided by financing activities		(545,848	)		(416,706	)		737,103

Net increase (decrease) in cash and cash equivalents		(423,615	)		429,561			97,701
Cash and cash equivalents at beginning of the year		825,589			396,028			298,327
Cash and cash equivalents at end of the year		401,974			825,589			396,028

Supplemental disclosures of cash flow information:
Cash paid during the year for interest		98,877			172,067			183,521

The accompanying notes are part of these consolidated financial statements.

F-8

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Consolidated statements of comprehensive income (loss)~~

~~Years ended December 31, 2008, 2007 and 2006~~

~~(in US$ thousand)~~

Notes 2008 2007 2006

Net income: 55,119 72,177 57,902

Other comprehensive income (loss):

Unrealized gains (losses) on securities available-for-sale:
Unrealized gains (losses) arising from the year 22 (58,453 ) (1,912 ) 5,349
Less: Reclassification adjustments for gains included in net income 6,22 (67 ) (9,119 ) (2,568 )
Net change in unrealized gains (losses) on securities available-for-sale (58,520 ) (11,031 ) 2,781

Unrealized losses on derivative financial instruments:
Unrealized losses arising from the year 22 (2,433 ) (2,081 ) (72 )
Less: Reclassification adjustments for net (gains) losses included in net income 22 (1,521 ) 143 -

Net change in unrealized losses on derivative financial instruments (3,954 ) (1,938 ) (72 )

Other comprehensive income (loss) (62,474 ) (12,969 ) 2,709

Comprehensive income (loss) (7,355 ) 59,208 60,611

~~The accompanying notes are part of these consolidated financial statements.~~

~~F-9~~

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Consolidated statements of cash flows~~

~~Years ended December 31, 2008, 2007 and 2006~~

~~(in US$ thousand)~~

2008 2007 2006
Cash flows from operating activities:
Net income 55,119 72,177 57,902
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Activities of derivative financial instruments and hedging 30,198 1,258 312
Depreciation and amortization of premises and equipment 3,720 2,555 1,406
Provision (reversal) for loan losses (18,540 ) 11,994 11,846
Provision (reversal) for losses on off-balance sheet credit risk 16,997 (13,468 ) (24,891 )
Impairment loss on assets 767 500 -
Net gain on sale of securities available-for-sale (67 ) (9,119 ) (2,568 )
Compensation cost - stock options plans 1,033 1,130 606
Issuance of restricted stock 261 (113 ) 95
Deferred compensation awards - - 13
Exercised stock options pursuant to compensation plan 15 - -
Amortization of premiums and discounts on investments 12,115 6,268 4,748
Net decrease (increase) in operating assets:
Trading assets (1,355 ) - -
Investment fund (68,849 ) 23,353 (105,199 )
Accrued interest receivable 16,056 (9,887 ) (22,234 )
Other assets 683 (2,583 ) 4,552
Net increase (decrease) in operating liabilities:
Trading liabilities 14,144 13 -
Accrued interest payable (5,671 ) 11,332 12,559
Other liabilities (6,088 ) 3,631 2,100
Net cash provided by (used in) operating activities 50,538 99,041 (58,753 )

Cash flows from investing activities:
Net increase in pledged interest bearing deposits (69,504 ) - (500 )
Net decrease (increase) in loans 1,089,851 (864,971 ) (384,433 )
Proceeds from the sale of loans 25,617 121,824 12,500
Net acquisition of premises and equipment (1,514 ) (1,595 ) (9,289 )
Proceeds from the redemption of securities available-for-sale 58,074 19,074 20,000
Proceeds from the maturity of securities held-to-maturity - 125,000 9,000
Proceeds from the sale of securities available-for-sale 229,877 578,697 129,731
Purchases of investment securities (536,880 ) (716,472 ) (419,143 )
Net cash provided by (used in) investing activities 795,521 (738,443 ) (642,134 )

Cash flows from financing activities:
Net increase (decrease) in due to depositors (293,323 ) 406,094 9,659
Net (decrease) increase in short-term borrowings and securities sold under repurchase agreements (291,789 ) (90,894 ) 834,905
Proceeds from borrowings and long-term debt 631,099 613,126 133,680
Repayments of borrowings and long-term debt (436,463 ) (161,670 ) (108,680 )
Dividends paid (30,862 ) (29,713 ) (63,364 )
Proceeds from the minority interest in the investment fund 4,689 - -
Redemption of redeemable preferred stock - - (3,216 )
Exercised stock options 151 160 -
Repurchase of common stock - - (28,657 )
Net cash (used in) provided by financing activities (416,498 ) 737,103 774,327

Net increase in cash and cash equivalents 429,561 97,701 73,440
Cash and cash equivalents at beginning of the year 396,028 298,327 224,887
Cash and cash equivalents at end of the year 825,589 396,028 298,327

Supplemental disclosures of cash flow information:
Cash paid during the year for interest 172,067 183,521 130,829

~~The accompanying notes are part of these consolidated financial statements.~~

~~F-10~~

Banco Latinoamericano de ~~Exportaciones,~~Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

1.	Organization

~~Banco Latinoamericano de Exportaciones,~~

Banco Latinoamericano de Comercio Exterior, S. A. (“Bladex Head Office” and together with its subsidiaries “Bladex” or the “Bank”), headquartered in Panama City, Republic of Panama, is a specialized supranational bank established to finance trade in Latin America and the Caribbean (the “Region”). The Bank was established pursuant to a May 1975 proposal presented to the Assembly of Governors of Central Banks in the Region, which recommended the creation of a multinational organization to increase the foreign trade financing capacity of the Region. The Bank was organized in 1977, incorporated in 1978 as a corporation pursuant to the laws of the Republic of Panama, and officially initiated operations on January 2, 1979. Under a contract signed in 1978 between the Republic of Panama and Bladex, the Bank was granted certain privileges by the government of Panama, including an exemption from payment of income taxes in Panama.

On April 15, 2009, the Bank’s shareholders approved at its Annual Shareholders’ Meeting some amendments to the Bank’s Articles of Incorporation. The amendments, that were effective on June 17, 2009, include, among others:

A change in the legal name of the Bank from Banco Latinoamericano de Exportaciones, S. A. to Banco Latinoamericano de Comercio Exterior, S. A.

An extension of the scope of the Bank’s activities to encompass all types of banking, investment, and financial or other businesses that support foreign trade and the development of Latin American countries.

Authorization of: (1) an increase in the total share capital of the Bank to two hundred ninety million (290,000,000) shares, including up to ten million of new preferred stock, with a par value US$10 each, to be issued in one or more series from time to time at the discretion of the Bank’s Board of Directors; and (2) the establishment of a new class of common shares (Class F) that will only be issued to (a) state entities and agencies of non-Latin American countries, including, among others, central banks and majority state-owned banks in those countries, and (b) multilateral financial institutions either international or regional institutions. When the number of issued and outstanding Class F common shares is equal to or greater than 15% of the total number of issued and outstanding common shares, the Class F shareholders shall have the right to elect one director of the Bank.

The Bank operates under a general banking license issued by the National Banking Commission of Panama, predecessor of the Superintendency of Banks of Panama (the “SBP”).

In the Republic of Panama, banks are regulated by the SBP through Law Decree No. 9 of February 1998, modified by Law Decree No. 2 of February 22, 2008. Banks are also regulated by the resolutions and agreements issued by this entity. The main aspects of this law and its regulations include: the authorization of banking licenses, minimum capital and liquidity requirements, consolidated supervision, procedures for management of credit and market risks, measures to prevent money laundering, the financing of terrorism and related illicit activities, and procedures for banking intervention and liquidation, among others.

F-9

Banco Latinoamericano de Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

Bladex Head Office’s ~~consolidated~~ subsidiaries are the following:

Bladex Holdings Inc., is a wholly owned subsidiary, incorporated under the laws of the State of Delaware, United States of America (USA), on May 30, 2000. Bladex Holdings Inc. exercises control over the following subsidiary companies:

Bladex Asset Management Inc., incorporated on May 24, 2006, under the laws of the State of Delaware, USA, serves as investment manager for Bladex Offshore Feeder Fund (the “Feeder”) and Bladex Capital Growth Fund (the “Fund”). On September 8, 2009, Bladex Asset Management Inc. was registered as a foreign entity in the Republic of Panama, to establish a branch in Panama, which will be mainly engaged in providing administrative and operating services to Bladex Asset Management Inc. in USA.

Clavex, LLC incorporated on June 15, 2006, under the laws of the State of Delaware, USA, ceased operations in February 2007.

The Feeder is an entity in which Bladex Head office ~~owned~~owns 82.34% at December 31, 2009, and 96.89% at December 31, ~~2008, and 100% at December 31, 2007.~~2008. The Feeder was incorporated on February 21, 2006 under the laws of the Cayman Islands, and invests substantially all its assets in the Fund, which ~~was~~is also incorporated under the laws of the Cayman Islands. The objective of the Fund is to achieve capital appreciation by investing in Latin American debt securities, stock ~~securities,~~indexes, currencies, and trading derivative instruments.

In April 2008, the Feeder was registered with the Cayman Island Monetary Authority (CIMA), under the Mutual Funds Law of the Cayman Islands. Until April 30, 2008, the Feeder was a wholly owned subsidiary of Bladex Head Office. On May 1, 2008, the Feeder began receiving third party investments.

In April 2009, the Fund was registered with CIMA, under the Mutual Funds Law of the Cayman Islands and began receiving third party investments.

Bladex Representacao Ltda., incorporated under the laws of Brazil on January 7, 2000, acts as the Bank’s representative office in Brazil. Bladex Representacao Ltda. is 99.999% owned by Bladex Head Office and 0.001% owned by Bladex Holdings Inc.

~~F-11~~

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Notes to consolidated financial statements~~

Clavex, ~~S.A.~~S. A., is a wholly owned subsidiary, incorporated on May 18, 2006, under the laws of the Republic of Panama, to mainly provide specialized training.

Bladex Head Office has an agency in New York City, USA (the ~~"New~~“New York ~~Agency"~~Agency”), which began operations on March 27, 1989. The New York Agency is principally engaged in financing transactions related to international trade, ~~primarily~~mostly the confirmation and financing of letters of credit for customers of the Region. The New York Agency is also licensed by the State of New York Banking Department, USA, to operate an International Banking Facility (“IBF”). The Bank also has representative offices in Buenos Aires, Argentina, and in Mexico City, D.F., Mexico, and an international administrative office in Miami, Florida, USA.

F-10

Banco Latinoamericano de Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

Bladex Head Office owns 50% of the equity shares of BCG PA LLC, a company incorporated under the laws of the State of Delaware, USA. This company owns “Class C” shares of the Fund that entitle it to receive a performance allocation on third-party investments in the ~~Feeder.~~Feeder and in the Fund.

2.	Summary of significant accounting policies

Basis of presentation

These consolidated financial statements have been prepared under accounting principles generally accepted in the United States of America (“U.S. GAAP”). All amounts presented in the consolidated financial statements and notes are expressed in ~~thousands of~~ dollars of the United Stated of America (“US$”), which is the Bank’s functional currency. The accompanying consolidated financial statements have been translated from Spanish to English for users outside of the Republic of Panama.

Effective July 1, 2009, the Financial Accounting Standards Board (the “FASB”) issued the FASB Accounting Standards Codification (the “ASC”) under ASC Topic 105-10, under which the historical GAAP hierarchy was eliminated and the ASC became the single official source of authoritative, non-governmental GAAP, other than guidance issued by the Securities and Exchange Commission (“SEC”). All other literature became non-authoritative. ASC Topic 105-10 became effective for financial statements issued for interim and annual periods ending after September 15, 2009.

Principles of consolidation

The consolidated financial statements include the accounts of Bladex Head Office and its subsidiaries. Bladex Head Office consolidates its subsidiaries in which it holds a controlling financial interest. All intercompany balances and transactions have been eliminated for consolidation purposes.

When Bladex holds an interest in investment companies under the Feeder-Master structure where the Feeder’s shareholding has not been diluted and it has not been registered as a mutual fund with any regulatory body, the Feeder, and thereby Bladex indirectly, fully consolidates the Master. In cases where the participation in the Feeder is diluted and such entity is registered as a mutual fund with a regulatory body, it is considered an investment company and the Feeder, and thereby Bladex indirectly, consolidates its participation in the Master utilizing the specialized accounting in the American Institute of Certified Public Accountants (“AICPA”) Audit and Accounting Guide for Investment Companies (the “Guide”).

~~F-12~~

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Notes to consolidated financial statements~~

When Bladex holds an interest in investment companies under the Feeder-Master structure where the Feeder’s shareholding has not been diluted and it has not been registered as a mutual fund with any regulatory body, the Feeder, and thereby Bladex indirectly, fully consolidates the Master on line-by-line basis. In other cases where the participation in the Feeder is diluted and such entity is registered as a mutual fund with a regulatory body, it is considered an investment company. In those cases, the Feeder, and thereby Bladex indirectly, consolidates its participation in the Master in one line item in the balance sheet, as required by the specialized accounting in the ASC Topic 946 - Financial Services – Investment Companies.

Equity method

Investments in companies in which Bladex Head Office exercises significant influence, but not control over its financial and operating policies, and holds an equity participation of at least 20%, but not more than 50%, are initially accounted for at cost, which is subsequently adjusted to record the participation of the investment in gains (losses) of the investee after the acquisition date.

F-11

Banco Latinoamericano de Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

~~Adoption of the specialized~~Specialized accounting for investment companies

Until April 30, 2008, the Feeder was a 100% subsidiary of Bladex Head Office and was a 100% owner of the Fund. Accordingly, amounts from the consolidated assets, liabilities, revenues and expenses of the Fund were reported in the respective line items of the consolidated balance sheet and statement of income of the Feeder, and ultimately of the Bank.

In April 2008, the Feeder was registered with CIMA under the Mutual Funds Law of Cayman Islands. Since May 1, 2008, the Feeder began receiving third party investments. Since that date, the Feeder began accounting for its investments in the Fund as an investment company, in accordance with the Guide. The Feeder and the Fund are organized under a “Feeder-Master” structure. Under this structure, the Feeder invests all its assets in the Fund which in turn invests in various assets on behalf of its investor. Specialized accounting for investment companies ~~within the Guide~~ requires the Feeder to reflect its investment in the Fund in a single line item equal to its proportionate share of the net assets of the Fund, regardless of the level of Feeder’s interest in the Fund. The Feeder records the Fund’s results by accounting for its participation in the net interest income and expenses of the Fund, as well as its participation in the realized and unrealized gains or losses of the Fund.

As permitted by ~~Emerging Issues Task Force (“EITF”) 85-12, “Retention of Specialized Accounting for Investments in Consolidation”,~~ASC Topic 810-10-25-15 – Consolidation, when Bladex consolidates its investment in the Feeder, it retains the specialized accounting for investment companies applied by the Feeder in the Fund, reporting it within the “Investment fund” line item in the consolidated balance sheet, and presenting the third party investments in the Feeder in the ~~“Minority~~“Redeemable noncontrolling interest in the investment fund” line item between liabilities and stockholders’ equity. The Bank reports interest income and expense from the Fund in the Investment fund line item within interest income and expense, ~~and~~ realized and unrealized gains and losses in the “Net gain ~~(loss)~~ from investment fund trading” line ~~item. Expenses~~item, and expenses from the Fund are reported in “Expenses from the investment fund” line item in the consolidated statements of income. ~~As this treatment, adopted~~

Use of estimates

The preparation of the consolidated financial statements requires management to make estimates and use assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. Material estimates that are particularly susceptible to significant changes relate to the determination of the allowances for credit losses, impairment of securities available-for-sale and held-to-maturity, and the fair value of financial instruments. Actual results could differ from those estimates. Management believes these estimates are adequate.

Cash equivalents

Cash equivalents consist of demand deposits in ~~2008, is considered a change~~banks and interest-bearing deposits in ~~reporting entity, for comparative purposes,~~banks with original maturities of three months or less, excluding pledged deposits.

Repurchase agreements

Repurchase agreements represent collateralized financing transactions used to increase liquidity. When the ~~financial statements as of and~~criteria set forth in the following paragraph are met to account for the ~~years ended December 31, 2007~~transaction as secured financing, the transaction is recorded at the amounts at which the securities will be subsequently reacquired including accrued interest, as specified in the respective agreements. The market value of securities to be repurchased is continuously monitored, and ~~2006~~additional collateral is obtained or provided where appropriate, to protect against credit exposure.

F-12

Banco Latinoamericano de Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

The Bank’s policy is to relinquish possession of the securities sold under agreements to repurchase. Despite such relinquishment of possession, repurchase agreements qualify as secured financings if and only if all of the following conditions are met: the assets to be repurchased are the same or substantially the same as those transferred; the transferor is able to repurchase them with the collateral received, keeping substantially the agreed terms, even in the event of default of the transferee; the agreement is to repurchase or redeem them before maturity, at a fixed and determinable price; and the agreement is entered into concurrently at the transfer date. In order to be able to repurchase assets on substantially the agreed terms, even in the case of default from the counterparty, the transferor must at all times, during the contract term, have ~~been adjusted~~obtained cash or other collateral sufficient to ~~apply~~fund substantially all the ~~treatment retrospectively.~~cost of purchasing the transferred assets from the counterparties.

When repurchase agreements do not meet the above-noted conditions, they qualify as sales of securities, for which the related security is removed from the balance sheet and a forward purchase agreement is recognized for the obligation to repurchase the security. Changes in fair value of the forward purchase agreement as well as any gain or loss resulting from the sale of securities under repurchase agreements are reported in earnings of the period within net gain (loss) from trading securities.

At the date of the repurchase agreement, the Bank recognizes as income the retained interest in the repurchase agreements accounted for as sales. The fair value of the retained interest is based upon quoted market prices when available, or if the quoted market prices are not available, on the present value of future expected cash flows using the information related to credit losses, prepayment speeds, forward yield curves, and discount rates commensurate with the risks involved.

Trading assets and liabilities

Trading assets and liabilities include bonds acquired for trading purposes, and receivables (unrealized gains) and payables (unrealized losses) related to derivative financial instruments which are not designated as hedges or which do not qualify for hedge accounting. These amounts include the derivative assets and liabilities net of cash received or paid, respectively, under legally enforceable master netting agreements. Trading assets and liabilities are carried at fair value, which is based upon quoted prices when available, or if quoted market prices are not available, on discounted expected cash flows using market rates commensurate with the credit quality and maturity of the security.

Unrealized and realized gains and losses on trading assets and liabilities are recorded in earnings as net gain (loss) from trading securities.

Investment securities

Securities are classified at the date of purchase based on the ability and intent to sell or hold them as investments. These securities consist of debt securities such as: negotiable commercial paper, bonds and floating rate notes.

F-13

Banco Latinoamericano de Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

Securities available-for-sale

These securities consist of debt instruments that the Bank buys with the intention of selling them prior to maturity and are subject to the same approval criteria as the rest of the credit portfolio. These securities are carried at fair value, based on quoted market prices when available, or if quoted market prices are not available, based on discounted expected cash flows using market rates commensurate with the credit quality and maturity of the security. Unrealized gains and losses are reported as net increases or decreases to other comprehensive income (loss) (OCI) in stockholders’ equity until they are realized. Realized gains and losses from the sale of securities which are included in net gain on sale of securities are determined using the specific identification method.

Securities held-to-maturity

Securities classified as held-to-maturity represent securities that the Bank has the ability and the intent to hold until maturity. These securities are carried at amortized cost and are subject to the same approval criteria as the rest of the credit portfolio.

Interest on securities is recognized based on the interest method. Amortization of premiums and discounts are included in interest income as an adjustment to the yield.

Impairment

The Bank conducts periodic reviews of all securities with unrealized losses to evaluate whether the impairment is other-than-temporary. Impairment of securities is evaluated considering numerous factors, and their relative significance varies case by case. Factors considered in determining whether unrealized losses are temporary include: the length of time and extent to which the market value has been less than cost, the severity of the impairment, the cause of the impairment and the financial condition of the issuer, activity in the market of the issuer which may indicate adverse credit conditions, the intent and ability of the Bank to retain the security for a sufficient period of time to allow of an anticipated recovery in the market value (with respect to equity securities) and the intent and probability of the Bank to sell the security before the recovery of its amortized cost (with respect to debt securities). If, based on the analysis, it is determined that the impairment is other-than-temporary, the security is written down to its fair value, and a loss is recognized through earnings as impairment loss on assets.

In cases where the Bank does not intend to sell a debt security and estimates that it will not be required to sell the security before the recovery of its amortized cost basis, the Bank periodically estimates if it will recover the amortized cost of the security through the present value of expected cash flows. If the present value of expected cash flows is less than the amortized cost of the security, it is determined that an other-than-temporary impairment has occurred. The amount of this impairment representing credit loss is recognized through earnings and the residual of the other-than-temporary impairment related to non-credit factors is recognized in other comprehensive income (loss).

In periods subsequent to the recognition of the other-than-temporary impairment, the difference between the new amortized cost and the expected cash flows to be collected is accreted as interest income. The present value of the expected cash flows is estimated over the life of the debt security. The other-than-temporary impairment of securities held-to maturity that has been recognized in other comprehensive income is accreted to the amortized cost of the debt security prospectively over its remaining life.

F-14

Banco Latinoamericano de Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

Interest accrual is suspended on securities that are in default, or on which it is likely that future interest payments will not be received as scheduled.

Investment Fund

The Feeder records its investment in the Fund at fair value, which is the Feeder’s proportionate interest in the net assets of the Fund.

The Fund invests in trading assets and liabilities that are carried at fair value, which is based upon quoted market prices when available. For financial instruments for which quoted prices are not available, the Fund uses independent valuations from pricing providers that use their own proprietary valuation models that take into consideration discounted expected cash flows, using market rates commensurate with the credit quality and maturity of the security. These prices are compared to independent valuations from counterparties. The Fund reports trading gains and losses from negotiation of these instruments as realized and unrealized gains and losses on investments.

~~F-13~~

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Notes to consolidated financial statements~~

~~Use of estimates~~

The preparation of the consolidated financial statements requires management to make estimates and use assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Material estimates that are particularly susceptible to significant changes relate to the determination of the allowances for credit losses, impairment losses on assets, impairment of securities available-for-sale and held-to-maturity, and the fair value of financial instruments. Actual results could differ from those estimates. Management believes these estimates are adequate.

~~Cash equivalents~~

~~Cash equivalents consist of demand deposits in banks and interest-bearing deposits in banks with original maturities of three months or less, less deposits pledged.~~

~~Repurchase agreements~~

Repurchase agreements represent collateralized financing transactions used to increase liquidity and are recorded at the amounts at which the securities will be subsequently reacquired including accrued interest, as specified in the respective agreements. The Bank’s policy is to relinquish possession of the securities sold under agreements to repurchase. The market value of securities to be repurchased is permanently monitored, and additional collateral is obtained or provided where appropriate, to protect against credit exposure.

Transactions similar to secured financing that do not meet certain criteria of Statement of Financial Accounting Standards (“SFAS”) 140, “Accounting for Transfers and Servicing of Financial Assets and Extinguishment of Liabilities”, to be accounted for as secured financing, are recorded as a sale of the transferred security with a forward obligation to repurchase the financial instrument. The forward repurchase obligation is accounted for as a financial derivative instrument and is recorded at fair value in the consolidated balance sheet with changes in the fair value recorded in gains (losses) from trading securities. At the date of the repurchase agreement, the Bank recognizes as income the retained interest in the repurchase agreements accounted for as sales. The fair value of the retained interest is based upon quoted market prices when available, or on the present value of future expected cash flows using the information related to credit losses, prepayment speeds, forward yield curves, and discount rates commensurate with the risks involved.

~~Trading assets and liabilities~~

Trading assets and liabilities include bonds acquired for trading purposes, and receivables (unrealized gains) and payables (unrealized losses) related to derivative financial instruments. These amounts include the derivative assets and liabilities net of cash received or paid, respectively, under legally enforceable master netting agreements. Trading assets and liabilities are carried at fair value, which is based upon quoted prices when available, or if quoted market prices are not available, on discounted expected cash flows using market rates commensurate with the credit quality and maturity of the security.

~~Unrealized and realized gains and losses on trading assets and liabilities are recorded in earnings as net gain (loss) from trading securities.~~

~~F-14~~

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Notes to consolidated financial statements~~

~~Investment securities~~

~~Securities available-for-sale~~

These securities consist of debt instruments that the Bank buys with the intention of selling them prior to maturity and are subject to the same approval criteria as the rest of the credit portfolio. These securities are carried at fair value, based on quoted market prices when available, or based on discounted expected cash flows using market rates commensurate with the credit quality and maturity of the security. Unrealized gains and losses are reported as net increases or decreases to the accumulated other comprehensive income (loss) in the stockholders’ equity until they are realized. Realized gains and losses from the sales of securities which are included in net gain on sale of securities are determined using the specific identification method.

~~Securities held-to-maturity~~

~~Interest on securities is recognized based on the interest method. Amortization of premiums and accretion of discounts are included in interest income as an adjustment to the yield.~~

~~Impairment~~

The Bank conducts periodic reviews of all securities with unrealized losses to evaluate whether the impairment is other-than-temporary. Impairment of securities is evaluated considering numerous factors, and their relative significance varies case by case. Factors considered in determining whether a loss is temporary include: the length of time and extent to which the market value has been less than cost, the severity of the impairment, the cause of the impairment and the financial condition of the issuer, activity in the market of the issuer which may indicate adverse credit conditions, and the intent and ability of the Bank to retain the security for a sufficient period of time to allow for an anticipated recovery in market value. If, based on the analysis, it is determined that the impairment is other-than-temporary, the security is written down to its fair value, and a loss is recognized through earnings as impairment loss on assets. Interest accrual is suspended on securities that are in default, or on which it is likely that future interest payments will not be received as scheduled.

~~F-15~~

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Notes to consolidated financial statements~~

j)k)

Other investments

Other investments that mainly consist of unlisted stock are recorded at cost and are included in other assets. The Bank determined that it is not practicable to obtain the market value of these investments, as these shares are not traded in a secondary market. ~~Impairment~~Performance of these investments is evaluated periodically and declines that are determined to be other-than-temporary are charged to earnings as impairment on assets.

k)l)

Loans

~~Loans are reported at their principal outstanding amounts net of unearned income, deferred fees and allowance for loan losses. Interest income is recognized as accrued.~~

Loans are reported at their principal outstanding amounts net of unearned income, deferred fees and allowance for loan losses. Interest income is recognized using the interest method. The amortization of net unearned income and deferred fees are recognized as an adjustment to the related loan yield using the effective interest method.

Purchased loans are recorded at acquisition cost. The difference between the principal and the acquisition cost of loans, the premiums and discounts, is amortized over the life of the loan as an adjustment to the yield. All other costs related to acquisition of loans are expensed when incurred.

Loans are identified as impaired and placed on a cash (non-accrual) basis when interest or principal is past due for 90 days or more, or before if the Bank’s management determines that the ultimate collection of principal or interest is doubtful. Factors considered by the Bank’s management in determining impairment include collection status, collateral value, the probability of collecting scheduled principal and interest payments when due, and economic conditions in the borrower’s country of residence. Any interest receivable is reversed and charged-off against current year’s earnings. Interest on non-accruing loans is only recorded as earned when collected. Non-accruing loans are returned to an accrual status when (1) all contractual principal and interest amounts are current (2) there is a sustained period of repayment performance in accordance with the contractual terms of at least six months; and (3) if in the Bank management’s opinion the loan is fully collectible. When current events or available information confirm that specific impaired loans or portions thereof are uncollectible, such impaired loans are charged-off against the allowance for loan losses.

A loan is classified as a troubled debt restructuring if a significant concession in amount, maturity or interest rate is granted to the borrower due to the deterioration in its financial condition. Marketable securities received in exchange for loans under debt restructurings are initially recorded at fair value, with any gain or loss recorded as recovery or charge to the allowance, and are subsequently accounted for as securities available-for-sale.

~~F-16~~F-15

Banco Latinoamericano de ~~Exportaciones,~~Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

Loans are identified as past-due and placed on a cash basis (non-accrual) when interest or principal is past due for 90 days or more, or before if the Bank’s management believes there is an uncertainty with respect to the ultimate collection of principal or interest. Factors considered by the Bank’s management in determining impairment include collection status, collateral value, the probability of collecting scheduled principal and interest payments when due, and economic conditions in the borrower’s country of residence. Any interest receivable on non-accruing loans is reversed and charged-off against earnings. Interest on these loans is only recorded as earned when collected. Non-accruing loans are returned to an accrual status when (1) all contractual principal and interest amounts are current; (2) there is a sustained period of repayment performance in accordance with the contractual terms of at least six months; and (3) if in the Bank management’s opinion the loan is fully collectible. When current events or available information confirm that specific impaired loans or portions thereof are uncollectible, such impaired loans are charged-off against the allowance for loan losses.

A loan is classified as a troubled debt restructuring if a significant concession is granted to the borrower due to the deterioration in its financial condition. Marketable securities received in exchange for loans under debt restructurings are initially recorded at fair value, with any gain or loss recorded as a recovery or charge to the allowance, and are subsequently accounted for as securities available-for-sale.

Transfer of financial assets

Transfers of financial assets, primarily loans, are accounted for as sales when control over the assets has been surrendered. Control over transferred assets is deemed to be surrendered when: (1) the assets have been isolated from the Bank even in bankruptcy or other receivership; (2) the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets; and (3) the Bank does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity or does not have the right to cause the assets to be returned. Upon completion of a transfer of assets that satisfies the conditions described above to be accounted for as a sale, the Bank recognizes the assets as sold and records in earnings any gain or loss on the sale. The Bank may retain interest in loans sold in the form of servicing rights. Gains or losses on sale of loans depend in part on the carrying amount of the financial assets involved in the transfer, and its fair value at the date of transfer. The fair value of instruments is determined based upon quoted market prices when available, or are based on the present value of future expected cash flows using information related to credit losses, prepayment speeds, forward yield curves, and discounted rates commensurate with the risk involved.

l)n)

Allowance for credit losses

The allowance for credit losses is provided for losses derived from the credit extension process, inherent in the loan portfolio and off-balance sheet financial instruments, using the reserve method of providing for credit losses. Additions to the allowance for credit losses are made by ~~charges to~~accreting earnings. Credit losses are deducted from the allowance, and subsequent recoveries are added. The allowance is also decreased by reversals of the allowance back to earnings. The allowance attributable to loans is reported as a deduction of loans and the allowance for off-balance sheet credit risk, such as, letters of credit and guarantees, is reported as a liability.

F-16

Banco Latinoamericano de Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

The allowance for possible credit losses includes an asset-specific component and a formula-based component. The asset-specific component relates to provision for losses on credits considered impaired and measured on a case-by-case basis. An allowance is established when the discounted cash flows (or ~~collateral value of~~ observable market ~~price)~~price of collateral) of the credit is lower than the carrying value of that credit. The formula-based component covers the Bank’s performing credit portfolio and is established based in a process that estimates the probable loss inherent in the portfolio, based on statistical analysis and management’s qualitative judgment. The statistical calculation is a product of internal risk classifications, probabilities of default and loss given default. The probability of default is supported by Bladex’s historical portfolio performance complemented by probabilities of default provided by external sources for higher risk cases, in view of the greater robustness of this external data for such cases. The loss given default is based on Bladex’s historical losses experience and best practices. The reserve balances, for both on and off-balance sheet credit exposures, are calculated applying the following formula:

Reserves = ∑(E x PD x LGD); where:

Exposure (E) = the total accounting balance (on and off-balance sheet) at the end of the period under review.

~~F-17~~

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Notes to consolidated financial statements~~

Probabilities of Default (PD) = one-year probability of default applied to the portfolio. Default rates are based on Bladex’s historical portfolio performance per rating category, ~~during an eight-year period,~~ complemented by Standard~~&Poor’s~~ & Poor’s (“S&P”) probabilities of default for high risk cases, in view of the greater robustness of S&P data for such cases.

Loss Given Default (LGD) = a factor is utilized, based on historical information, ~~sames~~same as based on best practices in the banking industry. Management applies ~~judgement~~judgment and historical loss ~~experience on a case-by-case basis.~~experience.

m)o)

Fair value of guarantees including indirect indebtedness of others

The Bank recognizes at inception a liability for the fair value of obligations undertaken such as stand-by letters of credit and guarantees. Fair value is calculated based on the present value of the premium to be received or a specific allowance for off-balance sheet credit contingencies, whichever is greater.

n)p)

Fees and commissions

Loan origination fees, net of direct loan origination costs, are deferred, and the net amount is recognized as revenue over the contractual term of the loans as an adjustment to the yield. These net fees are not recognized as revenue during periods in which interest income on loans is suspended because of concerns about the realization of loan principal or interest. Underwriting fees are recognized as revenue when the Bank has rendered all services to the issuer and is entitled to collect the fee from the issuer, when there are no contingencies related to the fee. Underwriting fees are recognized net of syndicate expenses. In addition, the Bank recognizes credit arrangement and syndication fees as revenue after satisfying certain retention, timing and yield criteria. Fees received in connection with a modification of terms of a troubled debt restructuring are applied as a reduction of the recorded investment in the loan. Fees earned on letters of credit, guarantees and other commitments are amortized using the straight-line method over the life of such instruments.

F-17

Banco Latinoamericano de Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

o)q)

Premises and equipment

Premises and equipment, including the electronic data processing equipment, are carried at cost less accumulated depreciation and amortization, except land, which is carried at cost. Depreciation and amortization are charged to operations using the straight-line method, over the estimated useful life of the related asset. The estimated original useful life for building is 40 years and for furniture and equipment is three to five years.

The Bank defers the cost of internal-use software that has a useful life in excess of one year in accordance with Statement of Position (“SOP”) 98-1, “Accounting for the Costs of Computer Software Developed or Obtained for Internal Use”. These costs consist of payments made to third parties related to the use of licenses and installation of both, software and hardware. Subsequent additions, modifications or upgrades to internal-use software are capitalized only to the extent that they allow the software to perform a task it previously did not perform. Software maintenance and training costs are expensed in the period in which they are incurred. Capitalized internal use software costs are amortized using the straight-line method over their estimated useful lives, generally consisting of five years.

~~F-18~~

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Notes to consolidated financial statements~~

The Bank defers the cost of internal-use software that has a useful life in excess of one year in accordance with ASC Topic 350-40 - Intangibles – Goodwill and Other – Internal-Use Software. These costs consist of payments made to third parties related to the use of licenses and installation of both, software and hardware. Subsequent additions, modifications or upgrades to internal-use software are capitalized only to the extent that they allow the software to perform a task it previously did not perform. Software maintenance and training costs are expensed in the period in which they are incurred. Capitalized internal use software costs are amortized using the straight-line method over their estimated useful lives, generally consisting of five years.

p)r)

Capital reserves

Capital reserves are established as a segregation of retained earnings and are, as such, a form of retained earnings. Even though the constitution of capital reserves is not required by the SBP, their reductions require the approval of the Bank’s Board of Directors and the SBP.

q)s)

~~Cash~~Stock-based compensation and ~~stock-based compensation plan~~stock options plans

The Bank applies ~~SFAS 123 (R) “Share-Based Payment”~~ASC Topic 718 – Compensation - Stock Compensation to account for compensation costs on restricted stock and stock option plans. Compensation cost is based on the grant date fair value of both ~~stocks~~stock and options and is recognized over the requisite service period of the employee. The fair value of each option is estimated at the grant date using the Black-Scholes option-pricing model. When options and ~~stocks~~stock are exercised, the Bank’s policy is to reissue shares from treasury stock.

r)t)

Derivative financial instruments and hedge accounting

The Bank uses derivative financial instruments for its management of interest rate and foreign exchange risks, which represent the majority of the Bank’s derivatives, as well as for trading purposes.

The Bank uses derivative financial instruments for its management of interest rate and foreign exchange risks. Interest rate swap contracts and cross-currency swap contracts have been used to manage interest rate and foreign exchange risks associated with debt securities and borrowings with fixed rates, and loans and borrowings in foreign currency. The accounting for changes in value of a derivative depends on whether the contract is for trading purposes or has been designated and qualifies for hedge accounting.

Derivatives held for trading purposes include interest rate swap, credit default ~~swaps~~swap and cross-currency swap contracts used for risk management purposes that do not qualify for hedge accounting. The fair value of trading derivatives is reported as trading assets ~~and~~or trading liabilities, as applicable. Changes in realized and unrealized gains and losses and interest ~~flows~~ from these trading instruments are included in net gain (loss) from trading securities.

F-18

Banco Latinoamericano de Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

Derivatives for hedging purposes primarily include forward foreign exchange contracts and interest rate swap contracts in U.S. dollars and ~~cross currency~~cross-currency swaps. Derivative contracts designated and qualifying ~~as fair value~~for hedge accounting are reported in the balance sheet as ~~other assets~~derivative financial instruments used for hedging - receivable and ~~other liabilities~~payable and hedge accounting is applied. In order to qualify for hedge accounting, a derivative must be considered highly effective at reducing the risk associated with the exposure being hedged. Each derivative must be designated as a hedge, with documentation of the risk management objective and strategy, including identification of the hedging instrument, the hedged item and the risk exposure, as well as how effectiveness will be assessed prospectively and retrospectively. The extent to which a hedging instrument is effective at achieving offsetting changes in fair value or cash flows must be assessed at least quarterly. Any ineffectiveness must be reported in current-period earnings. The Bank discontinues hedge accounting prospectively in the following situations:

It is determined that the derivative is no longer effective in offsetting changes in the fair value or cash flows of a hedged item.

The derivative expires or is sold, terminated or exercised.

The Bank otherwise determines that designation of the derivative as a hedging instrument is no longer appropriate.

~~F-19~~

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Notes to consolidated financial statements~~

The Bank carries all ~~derivatives~~derivative financial instruments in the consolidated balance sheet at fair value. For qualifying fair value hedges, all changes in the fair value of the derivative and the fair value of the item for the risk being hedged are recognized in earnings. If the hedge relationship is terminated, then the fair value adjustment to the hedge item continues to be reported as part of the basis of the item and is amortized to earnings as a yield adjustment. For qualifying cash flow hedges, the effective portion of the change in the fair value of the derivative is recorded in ~~other comprehensive income~~OCI and recognized in the income statement when the hedged cash flows affect earnings. The ineffective portion is recognized in the income statement as activities of derivative ~~financial~~ instruments and hedging. If the cash flow hedge relationship is terminated, related amounts in ~~other comprehensive income~~OCI are reclassified into earnings when hedged cash flows occur.

s)u)

Foreign currency transactions

Assets and liabilities denominated in foreign currencies are translated into U.S. dollar equivalents using period-end spot foreign exchange rates. The effects of ~~translating~~translation of monetary assets and liabilities into the U.S. dollar are included in earnings.

t)v)

Income taxes

Bladex Head Office is ~~exempt~~exempted from payment of income taxes in Panama in accordance with ~~its Constitutive Law that grants special benefits, including~~ the ~~total exemption~~contract signed between the Republic of ~~income tax payment.~~Panama and Bladex.

The Feeder and the Fund are not subject to income taxes in accordance with the laws of the Cayman Islands. The Feeder and the Fund received an undertaking exempting them from taxation of all future profits until March 7, 2026.

Clavex, ~~S.A.~~S. A. is subject to income taxes in Panama on profits from local operations.

Bladex Representacao ~~Ltd.~~Ltda. is subject to income taxes in Brazil.

The New York Agency and Bladex’s subsidiaries incorporated in ~~the~~ USA are subject to ~~USA~~ federal and local taxation in USA based on the portion of income that is effectively connected with its operations in that country.

~~Such amounts of income taxes have been immaterial to date.~~

~~Minority interest in the investment fund~~

The Bank reports the noncontrolling interest in the Feeder between liabilities and stockholders’ equity. The minority interest in the Feeder represents the participation of other investors in the net assets of the Feeder.

~~F-20~~F-19

Banco Latinoamericano de ~~Exportaciones,~~Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

Such amounts of income taxes have been immaterial to date.

v)w)

Redeemable noncontrolling interest in the investment fund

The redeemable noncontrolling interest in the Feeder represents the participation of other investors in the net assets of the Feeder.

Effective January 1, 2009, the Bank adopted ASC 810, Noncontrolling Interest in Consolidated Financial Statements. This new accounting guidance requires that a noncontrolling interest, previously referred to as a minority interest, in a consolidated subsidiary be reported as a separate component of equity and the amount of consolidated net income specifically attributable to the noncontrolling interest be presented separately, below net income in the consolidated statement of income.

Furthermore, in accordance with ASC 480-10-S99, equity securities that are redeemable at the option of the holder and not solely within the control of the issuer must be classified outside of equity. The terms of third party investments in the Feeder contain a redemption clause which allows the holders the option to redeem their investment at fair value. Accordingly, the Bank retains its presentation of the noncontrolling interest in the investment fund between liabilities and stockholders’ equity in the consolidated balance sheets. Additionally, net assets of the Feeder are measured and presented at fair value, given the nature of its net assets (i.e. represented mainly by cash and investments in securities). Therefore, when calculating the value of the redeemable noncontrolling interest under ASC Topic 810, such amount is already recorded at its fair value and no further adjustments under ASC 480-10-S99 are necessary. Therefore, adoption of this new guidance did not have a material effect on the Bank’s consolidated financial position, results of operations, or on financial statement presentation.

Earnings per share

Basic earnings per share is computed by dividing the net income ~~available~~attributable to ~~common stockholders~~Bladex Head Office (the numerator) by the weighted average number of common shares outstanding (the denominator) during the year. Diluted earnings per share ~~measures~~measure performance incorporating the effect that potential common shares, such as stock options and restricted stock units outstanding during the same period, would have on net earnings per share. The computation of diluted earnings per share is similar to the computation of basic earnings per share, except for the denominator, which is increased to include the number of additional common shares that would have been issued if the beneficiaries of stock purchase options and other stock plans could exercise their options. The number of potential common shares that would be issued is determined using the treasury stock method.

w)y)

Recently issued accounting standards

~~At the end of 2007 and during 2008, the following~~During 2009, new accounting standards, modifications and interpretations to standards, applicable to the Bank, have been issued ~~that~~and are not in effect as of the date of the consolidated balance sheet, and thus have not been applied in the preparation of these consolidated financial ~~statements:~~statements. These standards establish the following:

F-20

~~SFAS 141 (R) – Business Combinations~~Banco Latinoamericano de Comercio Exterior, S. A.

and Subsidiaries

~~SFAS 141 (R) modifies~~

Notes to consolidated financial statements

ASC 860-10 (FAS 166 – Accounting for Transfers of Financial Assets – an amendment of FASB 140)

The objective of this statement is to improve the ~~accounting for business combinations~~relevance, representational faithfulness and ~~requires, with limited exceptions,~~comparability of the ~~acquirer~~information that a reporting entity provides in its financial statements about a ~~business combination to recognize all~~transfer of financial assets, ~~acquired, liabilities assumed,~~the effects of a transfer on its financial position, financial performance, and cash flows, and a transferor’s continuing involvement, if any, ~~noncontrolling interest~~ in ~~the acquiree at the acquisition date fair value.~~ transferred financial assets.

This statement is effective for financial statements issued for fiscal years beginning after November 15, 2009 and for interim periods beginning on or after December 15, 2008. With respect to the effect of income taxes, for business combinations in which the acquisition date was before the effective date of this statement, the acquirer shall apply the requirements of SFAS 109, “Accounting for Income Taxes”, as amended by this statement, except for (i) changes in the valuation allowance for acquired deferred taxes by the acquiror and (ii) changes in acquired income tax positions in accordance with FASB Interpretation No. 48.within that first annual reporting period. Early ~~adoption~~application is prohibited. The Bank is currently evaluating the potential impact on its consolidated financial statements of adopting this standard.

~~SFAS 160~~ASC 810-10 (FAS 167 – ~~Noncontrolling Interests in Consolidated Financial Statements~~Amendments to FIN 46 (R))

~~SFAS 160~~This statement amends ~~Accounting Research Bulletin (“ARB”) 51, “Consolidated Financial Statements”,~~guidance related to ~~establish accounting and reporting standards for the noncontrolling~~variable interest ~~in a subsidiary and for the deconsolidation of a subsidiary.~~entities. The objective of this statement is to ~~improve the relevance, comparability, and transparency of the financial information that~~require enterprises to carefully reconsider its previous conclusions including (1) whether an entity ~~provides in its consolidated~~is a variable interest entity (“VIE”), (2) whether the enterprise is the VIE’s primary beneficiary, and (3) what type of financial ~~statements. It clarifies that a noncontrolling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as stockholders’ equity.~~ statement disclosures are required.

This statement is effective for financial statements issued for fiscal years ~~and interim periods~~ beginning ~~on or after December 15, 2008. Its early adoption is prohibited; however, the~~ ~~presentation and disclosure requirements shall be applied retrospectively for all periods presented. The Bank is currently evaluating the potential impact on its consolidated financial statements of adopting this standard.~~

~~F-21~~

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Notes to consolidated financial statements~~

~~SFAS 161 – Disclosures about Derivative Instruments and Hedging Activities~~

SFAS 161 amends and expands the disclosure requirements of SFAS 133, “Accounting for Derivative Instruments and Hedging Activities”, with the intention to provide users of financial statements a better understanding of derivative instruments and how those instruments affect the financial position, performance and cash flows of the Bank. In order to meet those objectives, SFAS 161 requires qualitative disclosures about objectives and strategies for using derivatives instruments; quantitative disclosures about fair value of and gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features related to derivative agreements. This statement is effective for financial statements issued for fiscal years and interim periods beginning on or after November 15, ~~2008.~~2009 and for interim periods within that first annual reporting period, and for interim and annual reporting periods thereafter. Early application is prohibited. The Bank is currently evaluating the potential impact on its consolidated financial statements of adopting this standard.

~~FASB Staff Position (“FSP”) FAS 157-2 – Effective Date of FASB Statement No. 157~~

3.	Cash and cash equivalents

~~This FSP delays the effective date of SFAS 157, “Fair Value Measurements”, for nonfinancial assets~~

Cash and liabilities. The delay is intended to allow the Board and constituents additional time to consider the effect of various implementation issues that have arisen, or that may arise, from the application of SFAS 157. This FSP defers the effective date of SFAS 157 to fiscal years beginning after November 15, 2008. The Bank is currently evaluating the potential impact on its consolidated financial statements of adopting this standard.cash equivalents are as follows:

~~FSP FAS 140-3 – Accounting for Transfers of Financial Assets and Repurchase Financing Transactions~~

	December 31,
	2009		2008
(In thousands of US$)

Cash and due from banks		2,961		11,474
Interest-bearing deposits in banks		421,595		889,119
Total		424,556		900,593
Less:
Pledged deposits		22,582		75,004
		401,974		825,589

~~The objective~~On December 31, 2009 and 2008, the Agency of ~~this FSP is~~New York had a pledged deposit with a carrying value of $5.5 million, with the New York State Banking Department, as required by law since March 1994. As of December 31, 2009, the Bank has pledged deposits of $17.1 million to ~~provide guidance on accounting for a transfer of a~~secure derivative financial asset and a repurchase financing. This FSP presumes that an initial transfer of a financial asset and a repurchase financing are considered part of the same arrangement (linked transaction) under SFAS 140. However, if certain criteria are met, the initial transfer and repurchase financing shall not be evaluated as a linked transaction and shall be evaluated separately under SFAS 140. This FSP is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. Earlier application is not permitted. The Bank is currently evaluating the potential impact on its consolidated financial statements of adopting this standard.instruments.

~~FSP FAS 142-3 – Determination~~As of December 31, 2008 the ~~Useful Life~~Bank had pledged deposits of ~~Intangible Assets~~

~~This FSP applies~~$69.5 million to ~~all assets accounted for in accordance with SFAS 142, “Goodwill~~secure securities sold under repurchase agreements and Other Intangible Assets”. The objective of this FSP is to improve the consistency between the useful life of a recognized intangible asset under SFAS 142 and the period of expected cash flows used to measure the fair value of the asset under SFAS 141, “Business Combinations”, ~~and other generally accepted accounting principles. This FSP is effective for~~derivative financial ~~statements issued for fiscal years beginning after December 15, 2008. The Bank is currently evaluating the potential impact on its consolidated financial statements of adopting this standard.~~instruments.

~~F-22~~F-21

Banco Latinoamericano de ~~Exportaciones,~~Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

~~FSP APB 14-1 – Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement)~~

This FSP clarifies that convertible debt instruments that may be settled in cash upon conversion, including partial cash settlement, are not addressed by paragraph 12 of Accounting Principles Board Opinion (“APB”) 14, “Accounting for Convertible Debt and Debt Issued with Stock Purchase Warrants”. Additionally, this FSP specifies that issuers of such instruments should separately account for the liability and equity components in a manner that will reflect the entity’s non-convertible debt borrowing rate when interest cost is recognized in subsequent periods. This FSP is effective for financial statements issued for fiscal years beginning after December 15, 2008. The Bank is currently evaluating the potential impact on its consolidated financial statements of adopting this standard.

~~FSP EITF 03-6-1 – Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities~~

The guidance in this FSP applies to the calculation of earnings per share under SFAS 128, “Earnings per Share”, for share-based payment awards with rights to dividends or dividend equivalents. This guidance addresses whether instruments granted in share-based payment transactions are participating securities prior to vesting and, therefore, need to be included in the earnings allocation in computing earnings per share. Unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents shall be included in the computation of EPS. This FSP is effective for financial statements issued for fiscal years beginning after December 15, 2008. Early application is not permitted; however, all prior-period EPS data presented shall be adjusted retrospectively to conform with the provisions of this FSP. The Bank is currently evaluating the potential impact on its consolidated financial statements of adopting this standard.

3.	~~Change in the reporting entity~~

As discussed in Note 2d, beginning May 1, 2008, the Feeder is classified as an investment company, for which it accounts for its investment in the Fund using the specialized accounting as required by the Guide, which resulted in a change in reporting entity. Amounts reported in the consolidated balance sheet as of December 31, 2007, and income and expense amounts in the consolidated statements of income, and consolidated cash flows statements for the years ended December 31, 2007 and 2006 have been adjusted to include the effects of applying the Guide retrospectively, in accordance with SFAS 154, “Accounting Changes and Error Corrections”. The Bank believes that the adoption of this accounting change with respect to the manner the Feeder presents its consolidation of the Fund is consistent with industry practice, resulting in a more appropriate presentation for investors. This presentation results in financial statements focused on the net assets of investment companies, which present the fair value of underlying investment instruments. This change improves the relevance, comparability and transparency of the financial information provided in the consolidated financial statements related to the Bank and Feeder business operations.

~~F-23~~

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Notes to consolidated financial statements~~

In the years 2007 and 2006, the Feeder consolidated, line by line, all assets and liabilities of the Fund. The change, effective May 2008, results in the Feeder accounting for its investment in the Fund in a single line item in the balance sheet, which corresponds to its share in the net assets of the Fund, regardless of the level of the Feeder’s interest in the Fund.

The adjustments had no impact in the net income or earnings per share reported in the years 2007 and 2006, although the presentation of income and expenses related to the Fund have been reclassified to conform to the presentation of 2008. Following totals of assets and liabilities in the consolidated balance sheet and totals in the consolidated statements of cash flows for the years 2007 and 2006 have been adjusted to apply the Guide retrospectively:

Balance Sheet – 2007

As Originally
Reported

As Adjusted

Effect of
Change

(In thousands of US$)

Total assets 4,790,532 4,698,571 (91,961 )
Total liabilities 4,178,281 4,086,320 (91,961 )

Statement of Cash Flows – Year 2007
As Originally
Reported
As Adjusted
Effect of
Change

(In thousands of US$)
Net cash provided by operating activities 146,754 99,041 (47,713 )
Net cash used in investing activities (764,281 ) (738,443 ) 25,838

Net increase in cash and cash equivalents 119,576 97,701 (21,875 )
Cash and cash equivalents at beginning of the year 298,695 298,327 (368 )
Cash and cash equivalents at end of the year 418,271 396,028 (22,243 )

Statement of Cash Flows – Year 2006
As Originally
Reported
As Adjusted
Effect of
Change

(In thousands of US$)
Net cash provided by (used in) operating activities (30,415 ) (58,753 ) (28,338 )
Net cash used in investing activities (670,104 ) (642,134 ) 27,970

Net increase in cash and cash equivalents 73,808 73,440 (368 )
Cash and cash equivalents at beginning of the year 224,887 224,887 -
Cash and cash equivalents at end of the year 298,695 298,327 (368 )

~~F-24~~

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Notes to consolidated financial statements~~

4.	~~Cash and cash equivalents~~

~~Cash and cash equivalents are as follows:~~

December 31,
2008 2007
(In thousands of US$)

Cash and due from banks 11,474 596
Interest bearing deposits in banks 889,119 400,932
Total 900,593 401,528
Less:
Pledged deposits 75,004 5,500
825,589 396,028

On December 31, 2008 and 2007, the Agency of New York had a pledged deposit with a carrying value of $5.5 million, with the State of New York Banking Department, as required by law since March 1994. As of December 31, 2008 the Bank has pledged deposits of $69.5 million to secure securities sold under repurchase agreements and derivative financial instruments.

5.	Trading assets and liabilities

The fair value of trading assets and liabilities is as follows:

	December 31,
	2009		2008
(In thousands of US$)

Trading assets:
Sovereign bonds		11,150		21,965
Corporate bonds		39,125		-
Credit default swap		2		-
Forward repurchase agreements		-		16,088
Retained interest on repurchase agreements		-		6,886
Total		50,277		44,939

Trading liabilities:
Interest rate swaps		2,514		14,066
Cross-currency interest rate swaps		638		-
Credit default swap		-		91
Total		3,152		14,157

Sovereign and corporate bonds outstanding as of December 31, 2009, have generated gains of $3.3 million during period 2009, which have been recorded in earnings.

During 2009, the Bank recognized the following gains and losses related to trading derivative financial instruments:

December 31,
2008 2007
(In thousands of US$)

Trading assets:
Sovereign bonds 21,965 -
Forward repurchase agreements 16,088 -
Retained interest on repurchase agreements 6,886 -
Total 44,939 -

Trading liabilities:
Interest rate swaps 14,066 -
Credit default swap 91 13
Total 14,157 13

(In thousands of US$)	2009
Trading derivatives	Gain (loss) recognized in the income statement(1)
Forward repurchase agreements		2,570
Interest rate swaps		(551	)
Cross-currency interest rate swaps		(638	)
Credit default swap		110
Total		1,491

~~Forward~~(1) Gains (losses) are reported within the net gain (loss) from trading securities line in the consolidated statements of income.

In addition to the trading derivative financial instruments, the Bank has hedging derivative financial instruments that are disclosed in Note 20.

At December 31, 2009 and 2008, trading derivative liabilities include interest rate swap and cross-currency interest rate swap contracts that were previously designated as fair value hedges of securities available-for-sale and foreign-currency loans, respectively, that no longer qualify for hedge accounting.

F-22

Banco Latinoamericano de Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

At December 31, 2009 and 2008, information on the nominal amounts of derivative financial instruments held for trading purposes is as follows:

	2009						2008
(In thousands of US$)	Nominal		Fair Value				Nominal		Fair Value
	Amount		Asset		Liability		Amount		Asset		Liability

Interest rate swaps		46,800		-		2,514		175,227		-		14,066
Cross-currency interest rate swaps		15,496		-		638		-		-		-
Credit default swap		3,000		2		-		3,000		-		91

Total		65,296		2		3,152		178,227		-		14,157

As of December 31, 2008, forward repurchase agreements ~~correspond~~corresponded to derivative financial instruments from transactions of securities sold under repurchase agreements accounted for as sales based on ~~SFAS 140~~ASC Topic 860 – Transfer and Servicing (see Notes 2(g) and ~~13)~~12).

During 2008, the Bank transferred sovereign and corporate bonds through repurchase agreements accounted for as sales. The Bank reacquired those bonds at the maturity date of those agreements and included them in the trading assets portfolio. As of December 31, 2008, sovereign bonds with a fair value of $10.3 million secured securities under repurchase agreements that qualify as secured ~~financing.~~

~~F-25~~

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Notes to consolidated financial statements~~

Trading liabilities include interest rate swaps in U.S. dollars that hedged securities available-for-sale that were subsequently transferred under repurchase agreements. The Bank discontinued hedge accounting prospectively at the transfer date of these investments, and reports these interest rate swaps as trading derivatives (see Note 13).financings.

6.5.	Investment securities

Securities available-for-sale

The amortized cost, related unrealized gross gain (loss) and fair value of securities available-for-sale, are as follows:

	December 31, 2009
(In thousands of US$)	Amortized Cost		Unrealized Gross Gain		Unrealized Gross Loss		Fair Value

Corporate debt:
Brazil		26,428		1,044		-		27,472
Chile		26,763		1,308		-		28,071
Panama		20,008		912		-		20,920
Venezuela		14,979		830		-		15,809
		88,178		4,094		-		92,272
Sovereign debt:
Brazil		86,583		6,817		-		93,400
Colombia		131,852		8,210		892		139,170
Dominican Republic		6,347		93		-		6,440
El Salvador		15,755		174		-		15,929
Mexico		56,194		1,236		550		56,880
Panama		21,057		1,649		-		22,706
Peru		28,441		1,746		-		30,187
		346,229		19,925		1,442		364,712

Total		434,407		24,019		1,442		456,984

December 31, 2008

(In thousands of US$)

Amortized
Cost

Unrealized
Gross Gain

Unrealized
Gross Loss

Fair
Value

Corporate debt:
Brazil 27,245 - 4,644 22,601
Chile 42,140 64 1,397 40,807
Panama 20,015 885 - 20,900
United States of America 9,725 - 17 9,708
Venezuela 14,973 252 - 15,225
114,098 1,201 6,058 109,241
Government debt:
Brazil 105,735 2,620 - 108,355
Colombia 169,026 401 6,690 162,737
Costa Rica 10,905 - 790 10,115
Dominican Republic 9,677 - 2,299 7,378
El Salvador 16,158 - 1,571 14,587
Mexico 97,839 - 5,883 91,956
Panama 43,281 - 1,681 41,600
Peru 28,881 - 1,943 26,938
Sweden 10,041 - 30 10,011
United States of America 24,999 1 - 25,000
516,542 3,022 20,887 498,677

Total 630,640 4,223 26,945 607,918

December 31, 2007

(In thousands of US$)

Amortized
Cost

Unrealized
Gross Gain

Unrealized
Gross Loss

Fair
Value

Corporate debt:
   Brazil 67,971 78 660 67,389
   Chile 42,849 - 549 42,300
   Panama 20,019 669 - 20,688
130,839 747 1,209 130,377
Government debt:
   Argentina 19,546 22 28 19,540
   Brazil 59,464 1,897 18 61,343
   Colombia 123,084 2,797 206 125,675
   Dominican Republic 13,093 - 182 12,911
   El Salvador 10,984 - 84 10,900
   Mexico 27,045 - 89 26,956
   Panama 50,008 1,462 112 51,358
   Peru 29,291 24 15 29,300
332,515 6,202 734 337,983

Total 463,354 6,949 1,943 468,360

~~F-26~~F-23

Banco Latinoamericano de ~~Exportaciones,~~Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

	December 31, 2008
(In thousands of US$)	Amortized Cost		Unrealized Gross Gain		Unrealized Gross Loss		Fair Value

Corporate debt:
Brazil		27,245		-		4,644		22,601
Chile		42,140		64		1,397		40,807
Panama		20,015		885		-		20,900
United States of America		9,725		-		17		9,708
Venezuela		14,973		252		-		15,225
		114,098		1,201		6,058		109,241
Sovereign debt:
Brazil		105,735		2,620		-		108,355
Colombia		169,026		401		6,690		162,737
Costa Rica		10,905		-		790		10,115
Dominican Republic		9,677		-		2,299		7,378
El Salvador		16,158		-		1,571		14,587
Mexico		97,839		-		5,883		91,956
Panama		43,281		-		1,681		41,600
Peru		28,881		-		1,943		26,938
Sweden		10,041		-		30		10,011
United States of America		24,999		1		-		25,000
		516,542		3,022		20,887		498,677

Total		630,640		4,223		26,945		607,918

At December 31, ~~2008~~2009 and ~~2007,~~2008, securities available-for-sale with a carrying value of ~~$480~~$79 million and ~~$323~~$480 million, respectively, were pledged to secure repurchase transactions accounted for as secured financings.

The following table discloses those securities that have had unrealized losses for less than 12 months and for 12 months or longer:

December 31, 2008
(In thousands of US$) Less than 12 months 12 months or longer Total

Fair
Value

Unrealized
Gross
Losses

Fair
Value

Unrealized
Gross
Losses

Fair
Value

Unrealized
Gross
Losses

Corporate debt 52,905 5,767 5,024 291 57,929 6,058
Government debt 270,757 18,588 7,377 2,299 278,134 20,887
323,662 24,355 12,401 2,590 336,063 26,945

	December 31, 2009
(In thousands of US$)	Less than 12 months				12 months or longer				Total
	Fair Value		Unrealized Gross Losses		Fair Value		Unrealized Gross Losses		Fair Value		Unrealized Gross Losses

Sovereign debt		24,138		550		24,720		892		48,858		1,442
		24,138		550		24,720		892		48,858		1,442

	December 31, 2007												December 31, 2008
(In thousands of US$)	Less than 12 months				12 months or longer				Total				Less than 12 months				12 months or longer				Total
	Fair Value		Unrealized Gross Losses		Fair Value		Unrealized Gross Losses		Fair Value		Unrealized Gross Losses		Fair Value		Unrealized Gross Losses		Fair Value		Unrealized Gross Losses		Fair Value		Unrealized Gross Losses

Corporate debt		68,244		1,107		30,495		102		98,739		1,209		52,905		5,767		5,024		291		57,929		6,058
Government debt		113,093		706		15,962		28		129,055		734
Sovereign debt														270,757		18,588		7,377		2,299		278,134		20,887
		181,337		1,813		46,457		130		227,794		1,943		323,662		24,355		12,401		2,590		336,063		26,945

F-24

Banco Latinoamericano de Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

Gross unrealized losses are related mainly to an overall increase in market interest rates and other market ~~credit spreads~~factors and not due to underlying credit concerns by the Bank about the issuers. The Bank has the intent, capacity and ability to hold these securities for a period of time sufficient to allow recovery of their market value. In order to do so, Bladex has built a liquidity and capital position strong enough to comply with its future disbursement requirements without having to dispose of its portfolio of investments available-for-sale. At December 31, 2008, the Bank believes that none of the securities in its investment portfolio are other-than-temporarily impaired. A g~~overnment~~sovereign debt that ~~has shown price declines~~shows an unrealized gross loss for ~~over~~more than twelve months relates to a counterparty whose payment performance is and continues to be ~~sound. The Government has engaged in debt restructurings in the past on its external debt, but on terms that were voluntarily agreed with its creditors.~~strong. The price of the bonds in question has seen a significant recovery ~~after~~during 2009. Historically, this counterparty has not failed to perform on its obligation. As of December 31, ~~2008.~~2009 the Bank does not intend to sell and will not be required to sell the security before its recovery of the amortized cost of the instrument. As a result, the Bank does not consider this exposure to be ~~other-than-temporarily~~other-than temporary impaired.

~~During 2006 the Bank collected impaired securities for $5.6 million which had been charged to earnings in prior years. These recoveries were recorded in earnings as recoveries on assets.~~

~~F-27~~

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Notes to consolidated financial statements~~

The following table presents the realized gains and losses on securities available-for-sale:

(In thousands of US$)	Year ended December 31,								Year ended December 31,
	2008			2007			2006		2009			2008			2007

Gains		2,173			9,550			2,568		1,276			2,173			9,550
Losses		(2,106	)		(431	)		-		(730	)		(2,106	)		(431	)
Net		67			9,119			2,568		546			67			9,119

Losses on securities available-for-sale during 2008 ~~are~~were mainly the result of transactions of securities sold under repurchase agreements accounted for as sales at the transfer date of those securities (see Note ~~13)~~12).

An analysis of realized losses is described below:

	Year ended December 31,								Year ended December 31,
(In thousands of US$)	2008			2007			2006		2009			2008			2007

Realized losses on sale of securities available-for-sale		(79	)		(431	)		-		(730	)		(79	)		(431	)
Realized losses for transfers of securities under repurchase agreements accounted for as sales (see Note 13)		(2,027	)		-			-
Realized losses for transfers of securities under repurchase agreements accounted for as sales (see Note 12)										-			(2,027	)		-
Total realized loss		(2,106	)		(431	)		-		(730	)		(2,106	)		(431	)

The amortized cost and fair value of securities available-for-sale by contractual maturity at December 31, ~~2008,~~2009, are shown in the following table:

(In thousands of US$)	Amortized Cost		Fair Value		Amortized Cost		Fair Value

Due within 1 year		59,889		59,906		30,302		31,463
After 1 year but within 5 years		285,855		276,023		231,775		243,983
After 5 years but within 10 years		284,896		271,989		172,330		181,538
		630,640		607,918		434,407		456,984

~~F-28~~F-25

Banco Latinoamericano de ~~Exportaciones,~~Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

Securities held-to-maturity

The amortized cost, related unrealized gross gain (loss) and fair value of securities held-to-maturity are as follows:

	December 31, 2008
(In thousands of US$)	Amortized Cost		Unrealized Gross Gain		Unrealized Gross Loss		Fair Value

Corporate debt:
United States of America		28,410		-		266		28,144
Total		28,410		-		266		28,144

At December 31, 2008, the contractual maturity of the securities held-to-maturity was within one year and none of the securities in this portfolio was considered other-than-temporarily impaired since such securities did not maintain significant gross unrealized losses for more than 12 months. At December 31, 2008, securities held-to-maturity with a carrying value of $28.4 million secured repurchase agreements accounted for as secured borrowings. All securities held-to-maturity were redeemed during the first quarter of 2009.

7.6.	Investment fund

The balance in the investment fund offor $197.6 million in 2009, and $150.7 million in 2008 ~~and $81.8 million in 2007~~ represents the participation of the Feeder in the net asset value (NAV) of the Fund.

At December 31, 2009, the Feeder owns 98.42% of the Fund with a total of 164,925.2 shares issued, divided in 30,725.5 “Class A” shares, 133,491.6 “Class B” shares and 708.1 “Class E” shares.

At December 31, 2008 the Feeder ~~owns~~owned 98.83% of the Fund with a total of 137,811.6 shares issued, divided in ~~4,320~~4,320.0 “Class A” shares and 133,491.6 “Class B” shares. ~~At December 31, 2007, the Feeder was the only investor of the Fund.~~

The Fund has issued “Class A”, “Class B”, “Class C”, “Class D” and “Class D”E” shares and administrative shares. “Class A” and “Class B” shares are participating shares in the net gains (losses) of the Fund, and only differ in relation to certain administrative fees. “Class C” and “Class D” shares do not participate in the net gains (losses) of the Fund; they are only entitled to the performance allocation. The “Class E” shares are not subject to either administrative fees or performance allocation. The Bank owns the Fund’s administrative shares.

~~F-29~~F-26

Banco Latinoamericano de ~~Exportaciones,~~Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

~~The statement of assets and liabilities of the Fund as of December 31, 2008 and 2007 is as follows:~~

(In thousands of US$) December 31,
2008 2007
Assets:
Cash (including pledged deposits of $7,994 in 2008 and $53,808 in 2007) 148,501 76,051
Deposits with related parties - 50,273
Bonds 21,705 16,097
Shares in indexed funds 1,745 36,315
Derivative financial instruments 3,481 185
Other assets (including interest receivable for $83 with related parties in 2007) 2,200 45,242
Total assets 177,632 224,163

Liabilities:
Bonds sold short 11,990 31,734
Shares in indexed funds sold short 2,420 57,863
Derivative financial instruments 696 1,155
Fees payable to related parties - 3,225
Other liabilities (including $495 with related parties in 2007) 11,831 1,704
Total liabilities 26,937 95,681

150,695 128,482
Less: net assets with related parties - (46,636 )

Net assets 150,695 81,846

~~The analysis of net assets is as follows:~~

(In thousands of US$, except per share amounts) December 31,
2008 2007
Net capital paid-in on shares of capital stock 137,992 100,000
Distributable earnings 12,703 28,482
Net assets (equivalent to $1,085 for “Class A” shares based on 4,320 shares, and $1,094 for “Class B” shares based on 133,492 shares in 2008; and $1.285 based on 100,000,000 ordinary shares in 2007) 150,695 128,482

~~F-30~~

~~Banco Latinoamericano de Exportaciones, S. A.~~

~~and Subsidiaries~~

~~Notes to consolidated financial statements~~

~~The statement of changes in net assets for 2008, 2007 and 2006 is as follows:~~

Year ended December 31,
(In thousands of US$) 2008 2007 2006

Increase (decrease) in net assets from operations:
Net investment income (loss) (3,629 ) 438 3,075
Net realized gain (loss) on investments 20,964 32,803 (4,235 )
Net change in unrealized gain (loss) on investments 393 (8,925 ) 5,326
Net increase in net assets resulting from operations 17,728 24,316 4,166
Capital contributions 6,000 - 100,000
Capital redemptions (1,515 ) - -
Total increase 22,213 24,316 104,166
Net assets
Beginning of year 128,482 104,166 -
End of year 150,695 128,482 104,166

8.7.

Loans

The following table set forth details of the Bank’s loan portfolio:

(In thousands of US$)	December 31,				December 31,
	2008		2007		2009		2008

Corporate		1,627,721		1,886,580		1,475,031		1,627,721
Banks:
Private		571,665		1,485,313		870,554		571,665
State-owned		347,403		241,322		333,574		347,403
Other		71,854		118,623

Others						100,103		71,854

Total		2,618,643		3,731,838		2,779,262		2,618,643

The composition of the loan portfolio by industry is as follows:

(In thousands of US$)	December 31,				December 31,
	2008		2007		2009		2008

Industrial		1,020,015		1,333,426		1,031,781		1,020,015
Banking and financing		924,286		1,731,961		1,208,458		924,286
Agricultural		332,582		271,931		230,674		332,582
Services		111,531		96,795		70,968		111,531
Other		230,229		297,725
Others						237,381		230,229

Total		2,618,643		3,731,838		2,779,262		2,618,643

The remaining loan maturities are summarized as follows:

(In thousands of US$)	December 31,
	2009		2008
Current:
Up to 1 month		253,077		236,679
From 1 month to 3 months		490,950		488,471
From 3 months to 6 months		559,934		315,200
From 6 months to 1 year		526,990		556,744
From 1 year to 2 years		424,073		345,471
From 2 years to 5 years		460,153		622,080
More than 5 years		28,335		53,998
		2,743,512		2,618,643
Impaired		35,750		-
Total		2,779,262		2,618,643

~~F-31~~F-27

Banco Latinoamericano de ~~Exportaciones,~~Comercio Exterior, S. A.

and Subsidiaries

Notes to consolidated financial statements

~~Loan maturities are summarized as follows:~~

(In thousands of US$) December 31,
2008 2007
Maturities:
Up to 1 month 236,679 667,612
From 1 month to 3 months 488,471 667,393
From 3 months to 6 months 315,200 572,597
From 6 months to 1 year 556,744 617,482
From 1 year to 2 years 345,471 399,655
From 2 years to 5 years 622,080 729,786
More than 5 years 53,998 77,313
2,618,643 3,731,838

The following table provides a breakdown of loans by country risk:

(In thousands of US$)	December 31,				December 31,
	2008		2007		2009		2008
Country:
Argentina		150,988		263,814		72,746		150,988
Bolivia		-		5,000
Brazil		1,289,424		1,379,394		1,334,905		1,289,424
Chile		8,333		10,000		258,257		8,333
Colombia		284,901		400,458		200,490		284,901
Costa Rica		54,855		76,506		82,906		54,855
Dominican Republic		48,025		28,770		31,364		48,025
Ecuador		36,364		60,529		23,097		36,364
El Salvador		75,857		46,563		40,650		75,857
Guatemala		60,784		95,902		73,809		60,784
Honduras		44,925		48,631		22,984		44,925
Jamaica		14,678		77,401		31,297		14,678
Mexico		380,209		410,164		301,929		380,209
Nicaragua		3,993		12,616		700		3,993
Panama		47,495		139,720		41,492		47,495
Peru		49,812		454,226		161,047		49,812
Trinidad and Tobago		23,000		87,565		71,589		23,000
Uruguay		45,000		-		30,000		45,000
Venezuela		-		134,579
		2,618,643		3,731,838		2,779,262		2,618,643

FOREIGN TRADE BANK OF LATIN AMERICA, INC.	~~REPUBLIC OF PANAMA~~
~~(Translation~~ (Translation of Registrant’s name into English)	~~(Jurisdiction~~ REPUBLIC OF PANAMA (Jurisdiction of incorporation or organization)

Title of each class Class E Common Stock	Name of each exchange on which registered
~~Class E Common Stock~~	New York Stock Exchange

	At and for the Year Ended December 31,
	2008			2007			2006			2005			2004
	(in $ thousands, except per share amounts and ratios)
Securities sold under repurchase agreements and Short-term borrowings		1,212,921			1,504,710			1,595,604			760,699			704,718
Borrowings and long-term debt		1,204,952			1,010,316			558,860			533,860			403,621
Total liabilities		3,783,665			4,086,320			3,338,477			2,542,449			2,076,810
Total stockholders’ equity		574,324			612,251			583,896			616,782			656,130
Average number of shares outstanding		36,388			36,349			37,065			38,550			39,232
Average number of diluted shares outstanding		36,440			36,414			37,572			38,860			39,372
Per Common Share Data:
Basic earnings per share		1.51			1.99			1.56			2.01			3.61
Diluted earnings per share		1.51			1.98			1.54			1.99			3.60
Book value per share (period end)		15.77			16.83			16.07			16.19			16.87
Regular cash dividends per share		0.88			0.88			0.75			0.60			0.50
Special cash dividends per share		0.00			0.00			1.00			2.00			1.00
Selected Financial Ratios:
Performance Ratios:
Return on average assets		1.09	%		1.76	%		1.70	%		3.00	%		5.83	%
Return on average stockholders’ equity		8.99	%		11.91	%		9.96	%		12.85	%		22.75	%
Net interest margin 2		1.55	%		1.73	%		1.78	%		1.70	%		1.65	%
Net interest spread 2		0.98	%		0.78	%		0.69	%		0.67	%		0.98	%
Total operating expenses to total average assets		0.79	%		0.90	%		0.85	%		0.93	%		0.88	%
Regular cash dividend payout ratio		58.09	%		44.32	%		48.01	%		29.84	%		13.84	%
Special cash dividend payout ratio		0.00	%		0.00	%		64.01	%		99.46	%		27.68	%
Asset Quality Ratios:
Impaired loans to total loans 3		0.00	%		0.00	%		0.00	%		1.11	%		10.50	%
Charged-off loans to total loans		0.00	%		0.00	%		0.00	%		0.36	%		0.53	%
Allowance for loan losses to total loans, net of unearned income and deferred commission		2.09	%		1.87	%		1.72	%		1.51	%		4.37	%
Allowance for credit losses to non-accruing credits		0	%		0	%		0	%		217	%		48	%
Capital Ratios:
Stockholders’ equity to total assets		13.16	%		13.03	%		14.89	%		19.52	%		24.01	%
Tier 1 capital to risk-weighted assets 4		20.4	%		21.2	%		23.8	%		33.7	%		42.5	%
Total capital to risk-weighted assets 5		21.6	%		22.5	%		25.1	%		35.0	%		43.8	%

	At and for the Year Ended December 31,									As of and for the Year Ended December 31,
	2008			2007			2006			2009			2008			2007
	(in $ million, except percentages)									(in $ million, except percentages)
Short-term borrowings and securities sold under repurchase agreements
Advances from banks	$	739		$	1,222		$	1,147		$	328		$	739		$	1,222
Discounted acceptances		0			0			10
Securities sold under repurchase agreements		474			283			438			71			474			283
Total short-term borrowings and securities sold under repurchase agreements	$	1,213		$	1,505		$	1,596		$	399		$	1,213		$	1,505

Maximum amount outstanding at any month-end	$	1,783		$	1,505		$	1,634		$	1,094		$	1,783		$	1,505
Amount outstanding at year-end	$	1,213		$	1,505		$	1,596		$	399		$	1,213		$	1,505
Average amount outstanding	$	1,629		$	1,272		$	1,042		$	764		$	1,629		$	1,272
Weighted average interest rate on average amount outstanding		3.82	%		5.45	%		5.21	%		2.77	%		3.82	%		5.45	%
Weighted average interest rate on amount outstanding at year end		5.13	%		5.34	%		5.51	%		1.61	%		3.77	%		5.34	%

	Amount		Weighted Average Cost
	(in $ million)
Short-term borrowings and Securities sold under repurchase agreements at fixed interest rate
Due in 0 to 30 days	$	145		2.15	%
Due in 31 to 90 days		37		1.45	%
Due in 91 to 180 days		188		1.14	%
Due in 181 to 365 days		20		1.80	%
Total	$	389		1.58	%
Short-term borrowings at floating interest rate
Due in 31 to 90 days		10		2.66	%
Total	$	10		2.66	%
Medium and long-term borrowings at fixed interest rate
Due in 0 to 30 days		2		8.34	%
Due in 31 to 90 days		10		5.60	%
Due in 91 to 180 days		7		8.38	%
Due in 181 to 365 days		25		6.80	%
Due in 1 through 6 years		39		4.65	%
Total	$	83		5.83	%
Medium and long-term borrowings at floating interest rate
Due in 31 to 90 days		20		0.92	%
Due in 91 to 180 days		48		1.07	%
Due in 181 to 365 days		412		1.15	%
Due in 1 through 6 years		779		2.01	%
Total	$	1,259		1.68	%
Medium and long-term fixed-rate placements
Due in 1 through 6 years		43		6.50	%
Total	$	43		6.50	%
Medium and long-term floating-rate placements
Due in 181 to 365 days		5		1.17	%
Total	$	5		1.17	%

6,342,189		Shares of Class A Common Stock
~~2,617,784~~2,584,882		Shares of Class B Common Stock
~~27,453,115~~27,618,545		Shares of Class E Common Stock
~~36,413,088~~ 0		Shares of Class F Common Stock
36,545,616		Total Shares of Common Stock

		Page
	~~Page~~
PART I

Item 1.	Identity of Directors, Senior Management and Advisers	5

Item 2.	Offer Statistics and Expected Timetable	5

Item 3.	Key Information	5
A.		Selected Financial Data	5
B.		Capitalization and Indebtedness	6
C.		Reasons for the Offer and Use of Proceeds	6
D.		Risk Factors	67

Item 4.	Information on the Company	910
A.		History and Development of the Company	910
B.		Business Overview	1011
C.		Organizational Structure	2328
D.		Property, Plant and Equipment	2328

Item 4A.	Unresolved Staff Comments	2428

Item 5.	Operating and Financial Review and Prospects	2428
A.		Operating Results	2429
B.		Liquidity and Capital Resources	3948
C.		Research and Development, Patents and Licenses, etc.	4454
D.		Trend Information	4455
E.		Off-Balance Sheet Arrangements	4555
F.		Contractual Obligations and Commercial Commitments	4556

Item 6.	Directors, Executive Officers and Employees	4656
A.		Directors and Executive Officers	4656
B.		Compensation	5061
C.		Board Practices	5464
D.		Employees	5869
E.		Share Ownership	5969

Item 7.	Major Stockholders and Related Party Transactions	5969
A.		Major Stockholders	5969
B.		Related Party Transactions	6071
C.		Interests of Experts and Counsel	6071

Item 8.	Financial Information	6072
A.		Consolidated Statements and Other Financial Information	6072
B.		Significant Changes	6172

Item 9.	The Offer and Listing	6172
A.		Offer and Listing Details	6172
B.		Plan of Distribution	6173
C.		Markets	6173
D.		Selling Stockholders	6273
E.		Dilution	6273

	At December 31,																				As of December 31,
	2008		%		2007		%		2006		%		2005		%		2004		%		2009(1)		%		2008		%		2007		%		2006		%		2005(2)		%
	(in $ million, except percentages)																				(in $ million, except percentages)
Loans	$	2,619		85.5	$	3,732		87.2	$	2,981		82.0	$	2,581		76.7	$	2,186		88.7	$	2,779		89.4	$	2,619		85.5	$	3,732		87.2	$	2,981		82.0	$	2,610		76.6
Contingencies and other assets		444		14.5		550		12.8		654		18.0		784		23.3		277		11.3		331		10.6		444		14.5		550		12.8		654		18.0		797		23.4
Total	$	3,062		100.0	$	4,281		100.0	$	3,634		100.0	$	3,365		100.0	$	2,463		100.0	$	3,110		100.0	$	3,062		100.0	$	4,281		100.0	$	3,634		100.0	$	3,407		100.0

	At December 31, 2008
	(in $ million)
	Due in one year or less		Due after one year through five years		Due after five years		Total
FIXED RATE
Private sector commercial banks	$	177	$	0	$	0	$	177
State-owned commercial banks		185		20		0		205
Sovereign debt		25		39		0		64
State-owned exporting organizations		8		0		0		8
Private corporations		455		24		0		479
Sub-total	$	850	$	83	$	0	$	933
FLOATING RATE
Private sector commercial banks	$	162	$	218	$	19	$	399
State-owned commercial banks		80		38		0		118
Sovereign debt		1		2		0		2
Central banks		25		0		0		25
State-owned exporting organizations		41		1	0			43
Private corporations		438		625		35		1,098
Sub-total	$	747	$	884	$	54	$	1,685
Total	$	1,597	$	968	$	54	$	2,619

	As of December 31, 2009
	(in $ million)
	Due in one year or less		Due after one year through five years		Due after five years through ten years (1)		Total
FIXED RATE
Private sector commercial banks and financial institutions	$	518	$	0	$	0	$	518
State-owned commercial banks		276		20		0		296
Sovereign debt		43		24		0		68
State-owned exporting organizations		102		0		0		102
Private corporations		299		29		0		328
Sub-total	$	1,238	$	73	$	0	$	1,311
FLOATING RATE
Private sector commercial banks and financial institutions	$	144	$	214	$	0	$	357
State-owned commercial banks		29		9		0		38
Sovereign debt		10		18		0		28
State-owned exporting organizations		91		0		0		91
Private corporations		325		606		23		954
Sub-total		599		847		23		1,469
Total	$	1,836	$	920	$	23	$	2,779

	2008 vs. 2007								2007 vs. 2006
	Volume		Rate			Net Change			Volume			Rate			Net Change
	(in $ thousand)
Increase (decrease) in interest income
Interest-bearing deposits with banks	$	3,036	$	(8,192	)	$	(5,155	)	$	6,282		$	412		$	6,694
Loans, net		19,135		(40,712	)		(21,576	)		42,863			12,957			55,819
Trading assets		0		648			648			0			0			0
Investment securities		17,659		(6,101	)		11,559			(2,728	)		896			(1,832	)
Investment fund		637		(6,739	)		(6,102	)		3,693			(2,854	)		839
Total increase (decrease)	$	40,468	$	(61,094	)	$	(20,627	)	$	50,109		$	11,411		$	61,519
Increase (decrease) in interest expense
Deposits	$	5,325	$	(31,403	)	$	(26,078	)	$	11,502		$	2,330		$	13,832
Investment Fund		0		(1,900	)		(1,900	)		0			(443	)		(443	)
Securities sold under repurchase agreements		9,019		(5,805	)		3,214			(2,895	)		204			(2,690	)
Short-term borrowings		2,998		(13,269	)		(10,271	)		15,746			2,239			17,986
Borrowings and long term debt		17,853		(10,720	)		7,133			18,844			2,257			21,101
Total increase (decrease)	$	35,195	$	(63,098	)	$	(27,903	)	$	43,198		$	6,588		$	49,786
Increase (decrease) in net interest income	$	5,273	$	2,004		$	7,276		$	6,911		$	4,823		$	11,734

	Total		0-30 Days			31-90 Days			91-180 Days			181-365 Days			More than 365 Days			Non-Interest Sensitive			Total		0-30 Days			31-90 Days			91-180 Days			181-365 Days			More than 365 Days			Non- Interest Sensitive
	(in $ million, except percentages)																				(in $ million, except percentages)
Interest-earning assets
Cash and due from banks	$	536		536			0			0			0			0			0
Interest-bearing deposits with banks		365		365			0			0			0			0			0
Cash, due from banks & interest-bearing deposits with banks																					$	425	$	425		$	0		$	0		$	0		$	0		$	0
Trading assets		45		0			0			0			0			45			0			50		0			0			0			0			50			0
Securities available-for-sale		608		35			91			15			0			467			0			457		0			49			0			31			377			0
Securities held-to-maturity		28		0			28			0			0			0			0
Investment fund		151		0			0			0			0			0			151			198		0			0			0			0			0			198
Loans, net	$	2,559		540			1,189			558			197			135			(59	)		2,701		477			1,158			700			265			180			(78	)
Total interest-earning assets		4,292		1,475			1,308			573			197			647			91			3,831		902			1,206			700			296			606			120
Non-interest earning assets		63		0			0			0			0			0			63			36		0			0			0			0			0			36
Other assets		7		0			0			0			0			0			7			12		0			0			0			0			0			12
Total assets	$	4,363	$	1,475		$	1,308		$	573		$	197		$	647		$	162		$	3,879	$	902		$	1,206		$	700		$	296		$	606		$	168
Interest-bearing liabilities
Deposits
Demand		113		113			0			0			0			0			0		$	51	$	51		$	0		$	0		$	0		$	0		$	0
Time		1,056		766			262			27			0			0			0			1,205		587			325			273			20			0			0
Trading liabilities		14		0			0			0			0			14			0			3		0			0			0			0			3			0
Securities sold under repurchase agreements		474		84			292			99			0			0			0			71		61			10			0			0			0			0
Short-term borrowings		739		187			342			125			85			0			0			328		84			37			188			20			0			0
Borrowings and long-term debt		1,205		190			775			65			32			143			0			1,390		175			958			120			22			116			0
Total interest-bearing liabilities		3,601		1,340			1,671			316			117			157			0			3,049		958			1,329			581			62			119			0
Non-interest-bearing liabilities		183		0			0			0			0			0			183			119		0			0			0			0			0			119
Total liabilities		3,784		1,340			1,671			316			117			157			183			3,168		958			1,329			581			62			119			119
Minority interest		5		0			0			0			0			0			5
Redeemable noncontrolling interest in the investment fund																						35		0			0			0			0			0			35
Stockholders’ equity		574		0			0			0			0			0			574			676		0			0			0			0			0			676
Total liabilities and stockholders’ equity	$	4,363	$	1,340		$	1,671		$	316		$	117		$	157			762		$	3,879	$	958		$	1,329		$	581		$	62		$	119		$	830
Interest rate sensitivity gap				135			(363	)		257			81			490			(600	)				(56	)		(123	)		119			234			487			(662	)
Cumulative interest rate sensitivity gap				135			(229	)		29			109			599								(56	)		(179	)		(60	)		175			662
Cumulative gap as a % of total interest-earning assets				3	%		-5	%		1	%		3	%		14	%							(1	)%		(5	)%		(2	)%		5	%		17	%

Name	Position Held with The Bank	Country of Citizenship	Year Term Expires	Director Since	Age
CLASS A
José Maria Rabelo Brazil	Director	Brazil	2010	2007	53
Guillermo Güémez García Deputy Governor Banco de Mexico, Mexico	Director	Mexico	2011	1997	68
Roberto Feletti Vice President Banco de la Nación Argentina, Argentina	Director	Argentina	2011	2008	50
CLASS E
Mario Covo Chief Executive Officer Finaccess International, Inc., U.S.A.	Director	U.S.A	2011	1999	51
Maria da Graça França Brazil	Director	Brazil	2010	2004	60
Herminio Blanco Chief Executive Officer Soluciones Estratégicas Consultoría, Mexico	Director	Mexico	2010	2004	58
William D. Hayes President Wellstone Global Finance, LLC, U.S.A.	Director	U.S.A.	2010	2004	65
Will C. Wood Principal Kentwood Associates, U.S.A.	Director	U.S.A.	2012	1999	69
ALL CLASSES OF COMMON STOCK
Gonzalo Menéndez Duque Director Banco de Chile, Chile	Chairman of the Board of Directors	Chile	2012	1990	60
Jaime Rivera Chief Executive Officer Bladex, Panama	Director	Guatemala	2012	2004	56

Name of Director	Number of Shares Beneficially Owned as of Dec. 31, 2008 (1)		Number of Shares that may be acquired within 60 days of Dec. 31, 2008		Stock Options (2006 Stock Option Plan) (pending to vest)		Restricted Shares (2)		Indexed Stock Options (pending to vest)
Guillermo Güémez García (3)		0		0		0		0		0
Roberto Feletti (4)		0		0		0		0		0
José Maria Rabelo (5)		0		0		0		0		0
Will C. Wood		10,480		6,482		1,061		5,895		536
Mario Covo		8,480		6,482		1,061		5,895		536
Herminio Blanco		28,005		6,482		1,061		5,895		536
William Hayes		20,275		6,482		1,061		5,895		536
Maria da Graça França		5,630		0		0		5,162		0
Gonzalo Menéndez Duque		12,722		9,727		1,591		8,844		803
Total		85,592		35,655		5,835		37,586		2,947

Balance Sheet – 2007	As Originally Reported		As Adjusted		Effect of Change
	(In thousands of US$)

Total assets		4,790,532		4,698,571		(91,961	)
Total liabilities		4,178,281		4,086,320		(91,961	)

Statement of Cash Flows – Year 2007	As Originally Reported			As Adjusted			Effect of Change
	(In thousands of US$)
Net cash provided by operating activities		146,754			99,041			(47,713	)
Net cash used in investing activities		(764,281	)		(738,443	)		25,838

Net increase in cash and cash equivalents		119,576			97,701			(21,875	)
Cash and cash equivalents at beginning of the year		298,695			298,327			(368	)
Cash and cash equivalents at end of the year		418,271			396,028			(22,243	)

Statement of Cash Flows – Year 2006	As Originally Reported			As Adjusted			Effect of Change
	(In thousands of US$)
Net cash provided by (used in) operating activities		(30,415	)		(58,753	)		(28,338	)
Net cash used in investing activities		(670,104	)		(642,134	)		27,970

Net increase in cash and cash equivalents		73,808			73,440			(368	)
Cash and cash equivalents at beginning of the year		224,887			224,887			-
Cash and cash equivalents at end of the year		298,695			298,327			(368	)

(In thousands of US$)	2008

Cash received from counterparties		147,301
Amortized cost of securities at the transfer dates		(192,907	)
Fair value of forward repurchase agreements		36,451
Retained interest on securities transferred under repurchase agreements		7,128

Recognized loss in transfers of securities under repurchase agreements accounted for as sales		(2,027	)

(In thousands of US$)	2008

Changes in fair value of forward repurchase agreements		(8,133	)
Changes in fair value of sovereign bonds		(1,583	)
Changes in fair value of interest rate swaps that hedged transferred securities		(11,219	)
Total changes in fair value of financial instruments resulting from transfers of securities under repurchase agreements		(20,935	)

(In thousands of US$)	2008

Loss in sale transactions under repurchase agreements		(2,027	)
Changes in fair value of financial instruments resulting from transfers of securities under repurchase agreements		(20,935	)
Total loss in transfers of securities under repurchase agreements		(22,962	)

(In thousands of US$)
Due in:	Outstanding		Outstanding

2009		210,280
2010		470,781		529,110
2011		26,966		317,394
2012		151,846		191,224
2013		305,944		310,084
2014		39,135		42,575
		1,204,952		1,390,387

(Share units)	Class “A”		Class “B”			Class “E”			Total			Class “A”		Class “B”			Class “E”		Class “F”		Total

Authorized		40,000,000		40,000,000			100,000,000			180,000,000			40,000,000		40,000,000			100,000,000		100,000,000		280,000,000

Outstanding at January 1, 2006		6,342,189		3,214,344			28,540,242			38,096,775
Conversions		-		(488,954	)		488,954			-
Restricted stock issued		-		-			5,967			5,967
Repurchased stock		-		-			(1,774,818	)		(1,774,818	)
Exercised stock options - compensation plans		-		-			1,150			1,150
Outstanding at December 31, 2006		6,342,189		2,725,390			27,261,495			36,329,074
Outstanding at January 1, 2007													6,342,189		2,725,390			27,261,495		-		36,329,074
Conversions		-		(64,540	)		64,540			-			-		(64,540	)		64,540		-		-
Accumulated difference in fractional shares in conversion of common stock		-		(3	)		-			(3	)		-		(3	)		-		-		(3	)
Restricted stock issued		-		-			22,240			22,240			-		-			22,240		-		22,240
Exercised stock options - compensation plans		-		-			18,838			18,838			-		-			18,838		-		18,838
Outstanding at December 31, 2007		6,342,189		2,660,847			27,367,113			36,370,149			6,342,189		2,660,847			27,367,113		-		36,370,149
Conversions		-		(43,063	)		43,063			-			-		(43,063	)		43,063		-		-
Restricted stock issued		-		-			31,246			31,246			-		-			31,246		-		31,246
Exercised stock options - compensation plans		-		-			11,693			11,693			-		-			11,693		-		11,693
Outstanding at December 31, 2008		6,342,189		2,617,784			27,453,115			36,413,088			6,342,189		2,617,784			27,453,115		-		36,413,088
Conversions													-		(32,902	)		32,901		-		-(1	)
Restricted stock issued													-		-			37,934		-		37,934
Exercised stock options - compensation plans													-		-			82,180		-		82,180
Restricted stock units - vested													-		-			12,415		-		12,415
Outstanding at December 31, 2009													6,342,189		2,584,882			27,618,545		-		36,545,616

(In thousands, except for share data)	Class “A”				Class “B”				Class “E”						Total						Class “A”				Class “B”				Class “E”						Total
																					Shares		Amount		Shares		Amount		Shares			Amount			Shares			Amount
	Shares		Amount		Shares		Amount		Shares			Amount			Shares			Amount

Outstanding at January 1, 2006		318,140		10,708		568,010		15,655		2,996,920			79,919			3,883,070			106,282
Repurchased during 2006		-		-		-		-		1,774,818			28,657			1,774,818			28,657
Restricted stock issued		-		-		-		-		(5,967	)		(144	)		(5,967	)		(144	)
Exercised stock options – compensation plans		-		-		-		-		(1,150	)		(27	)		(1,150	)		(27	)
Outstanding at December 31, 2006		318,140		10,708		568,010		15,655		4,764,621			108,405			5,650,771			134,768
Outstanding at January 1, 2007																						318,140		10,708		568,010		15,655		4,764,621			108,405			5,650,771			134,768
Restricted stock issued		-		-		-		-		(22,240	)		(531	)		(22,240	)		(531	)		-		-		-		-		(22,240	)		(531	)		(22,240	)		(531	)
Exercised stock options – compensation plans		-		-		-		-		(18,838	)		(449	)		(18,838	)		(449	)		-		-		-		-		(18,838	)		(449	)		(18,838	)		(449	)
Outstanding at December 31, 2007		318,140		10,708		568,010		15,655		4,723,543			107,425			5,609,693			133,788			318,140		10,708		568,010		15,655		4,723,543			107,425			5,609,693			133,788
Restricted stock issued		-		-		-		-		(31,246	)		(745	)		(31,246	)		(745	)		-		-		-		-		(31,246	)		(745	)		(31,246	)		(745	)
Exercised stock options – compensation plans		-		-		-		-		(11,693	)		(280	)		(11,693	)		(280	)		-		-		-		-		(11,693	)		(280	)		(11,693	)		(280	)
Outstanding at December 31, 2008		318,140		10,708		568,010		15,655		4,680,604			106,400			5,566,754			132,763			318,140		10,708		568,010		15,655		4,680,604			106,400			5,566,754			132,763
Restricted stock issued																						-		-		-		-		(37,934	)		(905	)		(37,934	)		(905	)
Exercised stock options – compensation plans																						-		-		-		-		(82,180	)		(1,960	)		(82,180	)		(1,960	)
Restricted stock units - vested																						-		-		-		-		(12,415	)		(296	)		(12,415	)		(296	)
Outstanding at December 31, 2009																						318,140		10,708		568,010		15,655		4,548,075			103,239			5,434,225			129,602

	2008
	Shares		Weighted Average Grant Date Fair Value
Outstanding at January 1, 2008		-		-
Granted		31,246	$	15.20
Vested		-		-
Outstanding at December 31, 2008		31,246	$	15.20
Expected to vest		31,246	$	15.20

	Shares			Weighted average grant date fair value
Outstanding at January 1, 2008		-			-
Granted		31,246		$	15.20
Vested		-			-
Outstanding at December 31, 2008		31,246			15.20
Granted		37,934			12.52
Vested		(6,242	)		15.20
Outstanding at December 31, 2009		62,938		$	13.58
Expected to vest		62,938		$	13.58

	Stock Units			Weighted Average Grant Date Fair Value		Weighted Average Remaining Contractual Term	Stock units			Weighted average grant date fair value		Weighted average remaining contractual term	Aggregate intrinsic value (thousands)
Outstanding at January 1, 2008		-			-			-			-
Granted		52,982		$	15.43			52,982		$	15.43
Forfeited		(756	)		15.43			(756	)		15.43
Outstanding at December 31, 2008								52,226			15.43
Granted								132,020			8.67
Forfeited								(5,713	)		11.44
Vested		-			-			(12,415	)		15.43	2.89 years	$	-
Outstanding at December 31, 2008		52,226		$	15.43	3.12 years
Outstanding at December 31, 2009								166,118		$	10.20		$	-
Expected to vest		51,304		$	15.43	3.12 years		166,118		$	10.20		$	-

	Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value (Thousands)		Options			Weighted average exercise price		Weighted average remaining contractual term	Aggregate intrinsic value (thousands)
Outstanding at January 1, 2008		-			-					-			-
Granted		232,403		$	15.43					232,403		$	15.43
Forfeited		(3,318	)		15.43					(3,318	)		15.43
Outstanding at December 31, 2008		229,085		$	15.43	6.12 years	$	-		229,085			15.43
Granted										601,985			10.15
Forfeited										(27,076	)		12.43
Outstanding at December 31, 2009										803,994		$	11.58	5.85 years	$	2,200
Exercisable										54,829		$	15.43	5.12 years	$	-
Expected to vest		225,036		$	15.43	6.12 years	$	-		749,165		$	11.30	5.90 years	$	2,200

	Shares			Weighted average grant date fair value
Non vested at January 1, 2007		27,076		$	14.02
Granted		22,240			21.35
Vested		(4,860	)		12.34
Non vested at December 31, 2007		44,456			17.87
Granted		-			-
Vested		(23,037	)		15.83
Non vested at December 31, 2008		21,419			20.07
Granted		-			-
Vested		(6,746	)	$	19.25
Non vested at December 31, 2009		14,673		$	20.45
Expected to vest		14,673		$	20.45

	Shares			Weighted Average Grant Date Fair Value
Non vested at January 1, 2006		21,109		$	13.49
Granted		5,967			15.90
Vested		-			-
Non vested at December 31, 2006		27,076			14.02
Granted		22,240			21.35
Vested		(4,860	)		12.34
Non vested at December 31, 2007		44,456			17.87
Granted		-			-
Vested		(23,037	)		15.83
Non vested at December 31, 2008		21,419		$	20.07
Expected to vest		21,419		$	20.07

	2007			2007

Weighted average fair value option	$	4.72		$	4.72
Weighted average expected terms, in years		5.50
Weighted average expected term, in years					5.50
Expected volatility		36	%		36	%
Risk-free rate		4.81	%		4.81	%
Expected dividend		3.54	%		3.54	%

	Options			Weighted average exercise price		Weighted average remaining contractual term	Aggregate intrinsic value (thousands)
Outstanding at January 1, 2007		-			-
Granted		208,765		$	16.34
Forfeited		-			-
Outstanding at December 31, 2007		208,765			16.34
Forfeited		(1,059	)		16.34
Outstanding at December 31, 2008		207,706			16.34
Forfeited		-			-
Outstanding at December 31, 2009		207,706		$	16.34	4.12 years	$	-
Exercisable at December 31, 2009		93,768		$	16.34	4.12 years	$	-
Expected to vest		113,938		$	16.34	4.12 years	$	-

	2006

Weighted average fair value option	$	4.67
Weighted average expected term, in years		7.00
Expected volatility		51.4	%
Risk-free rate		3	%
Expected dividend		6.7	%

(In thousands of US$)
Maturities	Amount

Within 1 year		~~403,203~~323,980
From 1 to 2 years		~~38,041~~4,769
From 2 to 5 years		~~1,188~~1,185
After 5 years		~~1,363~~851
		~~443,795~~330,785

	(In thousands of US$)
(In thousands of US$)			(In thousands of US$)
Year	Future Rental Commitments			Future Rental Commitments

2009		552
2010		563			577
2011		515			526
2012		261			261
2013		243			243
2014					243
Thereafter		446			203
		2,580			2,053

(In thousands of US$)
Derivatives - fair value hedge	Classification in statements of income	Gain (loss) on derivatives
Interest rate swaps	Interest income – Investment securities available-for-sale		(11,959	)
Cross-currency interest rate swaps	Gain (loss) on foreign currency exchange		591
Cross-currency interest rate swaps	Interest income – Loans		(62	)
Cross-currency interest rate swaps	Interest expense - Borrowings		3,480
Cross-currency interest rate swaps	Derivative financial instruments and hedging		(2,531	)
Total			(10,481	)