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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



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FORM 20-F



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(Box) REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF
THE SECURITIES EXCHANGE ACT OF 1934

OR

(X Box) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2001

OR

(Box) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to _______



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Commission File Number 1-11414

BANCO LATINOAMERICANO DE EXPORTACIONES, S.A.(Exact name of Registrant as specified in its charter)

|                                                                          |  |                                                                  
|------------------------------------------------------------------------- |  | -----------------------------------------------------------------
|LATIN AMERICAN EXPORT BANK(Translation of Registrants name into English) |  | REPUBLIC OF PANAMA(Jurisdiction of incorporation or organization)



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Calle 50 y Aquilino de la Guardia
Apartado 6-1497
El Dorado, Panama City
Republic of Panama
507-210-8500(Address and telephone number of Registrants principal executive offices)



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Securities registered or to be registered pursuant to Section 12(b) of the Act.

|                                         |  |                                                                  
|---------------------------------------- |  | -----------------------------------------------------------------
|Title of each class
Class E Common Stock |  | Name of each exchange on which registered
New York Stock Exchange

Securities registered or to be registered pursuant to Section 12(g) of the Act.
None

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.
None



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Indicate the number of outstanding shares of each of the issuers classes of
capital or common stock as of the close of the period covered by the annual
report:

| |  |  |            |  |  |                                |  | 
| |  |  | ---------- |  |  | ------------------------------ |  | 
| |  |  | 4,911,185  |  |  | Shares of Class A Common Stock
|
|
|
|
| |  |  | 4,247,213  |  |  | Shares of Class B Common Stock
|
|
|
|
| |  |  | 8,182,440  |  |  | Shares of Class E Common Stock
| |  |  |            |  |  |                                |  | 
| |  |  | 17,340,838 |  |  | Total Shares of Common Stock  

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

|        |  |     |  |       |  |   
|------- |  | --- |  | ----- |  | --
|(X Box) |  | Yes |  | (Box) |  | No

Indicate by check mark which financial statement item the Registrant has elected to follow.

|      |  |         |  |         |  |        
|----- |  | ------- |  | ------- |  | -------
|(Box) |  | Item 17 |  | (X Box) |  | Item 18



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TABLE OF CONTENTS



|                                                                  |                                                                                       |  |  |  |  |  |  | 
|----------------------------------------------------------------- | ------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|PART I                                                           
|                                                                  | Item 1. Identity of Directors, Senior Management and Advisers                        
|                                                                  | Item 2. Offer Statistics and Expected Timetable                                      
|                                                                  | Item 3. Key Information                                                              
|                                                                  | Item 4. Information on the Company                                                   
|                                                                  | Item 5. Operating and Financial Review and Prospects                                 
|                                                                  | Item 6. Directors, Senior Management and Employees                                   
|                                                                  | Item 7. Major Shareholders and Related Party Transactions                            
|                                                                  | Item 8. Financial Information                                                        
|                                                                  | Item 9. The Offer and Listing                                                        
|                                                                  | Item 10. Additional Information                                                      
|                                                                  | Item 11. Quantitative and Qualitative Disclosure About Market Risk                   
|                                                                  | Item 12. Description of Securities Other than Equity Securities                      
|PART II                                                          
|                                                                  | Item 13. Defaults, Dividend Arrearages and Delinquencies                             
|                                                                  | Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds
|                                                                  | Item 15. (Reserved)                                                                  
|                                                                  | Item 16. (Reserved)                                                                  
|PART III                                                         
|                                                                  | Item 17. Financial Statements                                                        
|                                                                  | Item 18. Financial Statements                                                        
|                                                                  | Item 19. Financial Statements and Exhibits                                           
|SIGNATURES                                                       
|INDEPENDENT AUDITORS REPORT                                     
|Consolidated Balance Sheets                                      
|Consolidated Statements of Income                                
|Consolidated Statements of Changes in Common Stockholders Equity
|Consolidated Statements of Other Comprehensive Income            
|Consolidated Statements of Cash Flows                            
|Notes to Consolidated Financial Statements                       



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##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S.A.

TABLE OF CONTENTS

|         |  |                                                                              |  |      |    | 
|-------- |  | ---------------------------------------------------------------------------- |  | ---- | -- | 
|         |  |                                                                              |  | Page
|         |  |                                                                              |  |     
|Item 1.  |  | Identity of Directors, Senior Management and Advisers                        |  |      | 4  | 
|        
|        
|        
|        
|Item 2.  |  | Offer Statistics and Expected Timetable                                      |  |      | 4  | 
|        
|        
|        
|        
|Item 3.  |  | Key Information                                                              |  |      | 4  | 
|        
|        
|        
|        
|Item 4.  |  | Information on the Company                                                   |  |      | 12 | 
|        
|        
|        
|        
|Item 5.  |  | Operating and Financial Review and Prospects                                 |  |      | 31 | 
|        
|        
|        
|        
|Item 6.  |  | Directors, Senior Management and Employees                                   |  |      | 46 | 
|        
|        
|        
|        
|Item 7.  |  | Major Shareholders and Related Party Transactions                            |  |      | 57 | 
|        
|        
|        
|        
|Item 8.  |  | Financial Information                                                        |  |      | 59 | 
|        
|        
|        
|        
|Item 9.  |  | The Offer and Listing                                                        |  |      | 60 | 
|        
|        
|        
|        
|Item 10. |  | Additional Information                                                       |  |      | 61 | 
|        
|        
|        
|        
|Item 11. |  | Quantitative and Qualitative Disclosure About Market Risk                    |  |      | 68 | 
|        
|        
|        
|        
|Item 12. |  | Description of Securities Other than Equity Securities                       |  |      | 73 | 
|        
|        
|        
|        
|Item 13. |  | Defaults, Dividend Arrearages and Delinquencies                              |  |      | 73 | 
|        
|        
|        
|        
|Item 14. |  | Material Modifications to the Rights of Security Holders and Use of Proceeds |  |      | 73 | 
|        
|        
|        
|        
|Item 15. |  | (Reserved)                                                                   |  |      | 74 | 
|        
|        
|        
|        
|Item 16. |  | (Reserved)                                                                   |  |      | 74 | 
|        
|        
|        
|        
|Item 17. |  | Financial Statements                                                         |  |      | 74 | 
|        
|        
|        
|        
|Item 18. |  | Financial Statements                                                         |  |      | 74 | 
|        
|        
|        
|        
|Item 19. |  | Financial Statements and Exhibits                                            |  |      | 74 | 



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In this Annual Report on Form 20-F (this Annual Report), all references
to the Bank or BLADEX are to Banco Latinoamericano de Exportaciones, S.A.,
a specialized multinational bank incorporated under the laws of Panama on
November 30, 1977, and its subsidiaries.

The Bank will provide without charge to each person to whom this Annual
Report is delivered, upon the written or oral request of such person, a copy of
any or all of the documents incorporated herein by reference (other than
exhibits, unless such exhibits are specifically incorporated by reference in
such documents). Written requests for such copies should be directed to the
attention of Carlos Yap, Vice President  Finance and Performance Management,
BLADEX, as follows: (i) if by regular mail, to Apartado 6-1497, El Dorado,
Panama City, Republic of Panama, and (ii) if by courier service, to Calle 50 y
Aquilino de la Guardia, Panama City, Republic of Panama. Telephone requests
may be directed to Mr. Yap at 011-507-210-8581. Written requests may also be
faxed to Mr. Yap at 011-507-269-6333 or sent via e-mail to cyap@blx.com.
Information is also available on the Banks website at: www.blx.com.

All references to dollars or $ are to United States dollars. The
numbers and percentages set out in this Annual Report have been rounded and,
accordingly, may not total exactly.

2



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##### Table of Contents



The Bank accepts deposits and raises funds principally in United States
dollars, grants loans mostly in United States dollars and publishes its
consolidated financial statements in United States dollars.

This Annual Report contains forward-looking statements of expected future
developments. The Bank wishes to ensure that such statements are accompanied
by meaningful cautionary statements pursuant to the safe harbor established in
the Private Securities Litigation Reform Act of 1995. The forward-looking
statements in this Annual Report refer to the possibility that the Bank will
need to renegotiate and restructure or write-off certain of its Argentine
loans, the adequacy of the Banks allowance for credit losses to address the
likely impact of the Argentine crisis on the Banks loan portfolio, the Banks
ability to execute a planned recapitalization, the availability of future
sources of funding for the Banks lending operations, the adequacy of the
Banks sources of liquidity to cover large deposit withdrawals and the impact
of the crisis in Argentina and developments in other countries in Latin America
on the Banks results of operations and financial condition. These
forward-looking statements reflect the expectations of the Banks management
and are based on currently available data; however, actual experience with
respect to these factors is subject to future events and uncertainties which
could materially impact the Banks expectations. Among the factors that can
cause actual performance and results to differ materially are as follows: a
decline in the willingness of international lenders and depositors to provide
funding to the Bank, adverse economic or political developments in the Region,
particularly in Argentina or Brazil, which could increase the level of impaired
loans in the Banks loan portfolio and, if sufficiently severe, result in the
Banks allowance for probable credit losses being insufficient to cover losses
in the portfolio, an unwillingness on the part of the Banks existing
shareholders or other investors to invest additional equity capital in the
Bank, unanticipated developments with respect to international banking
transactions, a change in the Banks credit ratings, events in Argentina,
Brazil or other countries in the Region unfolding in a manner that is
detrimental to the Bank or which result in adequate liquidity being unavailable
to the Bank.

3



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##### Table of Contents






PART I




Item 1. Identity of Directors, Senior Management and Advisers

Not required in this Annual Report.




Item 2. Offer Statistics and Expected Timetable

Not required in this Annual Report.




Item 3. Key Information

Selected Financial Data

The following table presents consolidated selected financial data for the
Bank. The financial data presented below are at December 31, 1997, 1998, 1999,
2000 and 2001 for the years then ended and are derived from the Banks
consolidated financial statements for the years indicated, which were audited
by KPMG Peat Marwick. The Consolidated Financial Statements (the Consolidated
Financial Statements) for the Bank for each of the years in the three-year
period ended December 31, 2001 are included in this Annual Report, together
with the report of KPMG Peat Marwick thereon. The information below is
qualified in its entirety by the detailed information, both financial and
otherwise, included elsewhere herein and should be read in conjunction with
Information on the Company, Operating and Financial Review and Prospects
and the Consolidated Financial Statements and Notes thereto included in this
Annual Report.

Consolidated Selected Financial Information

|                       |                                                                         |  |   |                                                     |   |      |   |         |   |      |   |         |   |  |   |         |   |  |   |         |   | 
|---------------------- | ----------------------------------------------------------------------- |  | - | --------------------------------------------------- | - | ---- | - | ------- | - | ---- | - | ------- | - |  | - | ------- | - |  | - | ------- | - | 
|                       |                                                                         |  |   | At and for the Year Ended December 31,             
|                       |                                                                         |  |   |                                                    
|                       |                                                                         |  |   | 1997                                                |   | 1998 |   | 1999    |   | 2000 |   | 2001   
|                       |                                                                         |  |   |                                                     |   |      |   |         |   |      |   |        
|                       |                                                                         |  |   | (in thousands, except per share amounts and ratios)
|                       |                                                                         |  |   |                                                     |   |      |   |         |   |      |   |         |   |  |   |         |   |  |   |        
|                      
|                      
|                      
|                      
|Income Statement Data: |                                                                         |  |   |                                                     |   |      |   |         |   |      |   |         |   |  |   |         |   |  |   |        
|                      
|                      
|                      
|                      
|                       | Net interest income                                                     |  | $ | 93,914                                              |   |      | $ | 92,210  |   |      | $ | 112,698 |   |  | $ | 112,670 |   |  | $ | 118,771 |  
|                      
|                      
|                      
|                      
|                       | Provision for loan losses (1)                                           |  |   | (15,600                                             | ) |      |   | (11,200 | ) |      |   | (14,700 | ) |  |   | (8,000  | ) |  |   | (77,144 | )
|                       |                                                                         |  |   |                                                     |   |      |   |         |   |      |   |         |   |  |   |         |   |  |   |        
|                       | Net interest income after provision for loan losses                     |  |   | 78,314                                              |   |      |   | 81,010  |   |      |   | 97,998  |   |  |   | 104,670 |   |  |   | 41,627  |  
|                      
|                      
|                      
|                      
|                       | Other income (expense):                                                 |  |   |                                                     |   |      |   |         |   |      |   |         |   |  |   |         |   |  |   |         |  
|                      
|                      
|                      
|                      
|                       | Net commission income                                                   |  |   | 19,727                                              |   |      |   | 20,038  |   |      |   | 25,480  |   |  |   | 24,742  |   |  |   | 13,691  |  
|                      
|                      
|                      
|                      
|                       | Provisions for losses on off balance sheet
credit risks                 |  |   |                                                    |   |      |   |        |   |      |   | (6,000  | ) |  |   | (11,200 | ) |  |   |        |  
|                      
|                      
|                      
|                      
|                       | Provisions for losses on guarantees                                     |  |   | (5,008                                              | ) |      |   | (15,534 | ) |      |   |        |   |  |   |        |   |  |   |        |  
|                      
|                      
|                      
|                      
|                       | Derivatives and hedging activities                                      |  |   |                                                    |   |      |   |        |   |      |   |        |   |  |   |        |   |  |   | 7,379   |  
|                      
|                      
|                      
|                      
|                       | Impairment loss on securities (2)                                       |  |   |                                                    |   |      |   |        |   |      |   |        |   |  |   |        |   |  |   | (40,356 | )
|                      
|                      
|                      
|                      
|                       | Gains on sale of securities available for sale                          |  |   |                                                    |   |      |   |        |   |      |   |        |   |  |   |        |   |  |   | 4,798   |  
|                      
|                      
|                      
|                      
|                       | Other income                                                            |  |   | 1,129                                               |   |      |   | 336     |   |      |   | 193     |   |  |   | 89      |   |  |   | 654     |  
|                       |                                                                         |  |   |                                                     |   |      |   |         |   |      |   |         |   |  |   |         |   |  |   |        
|                       | Net other income (expense)                                              |  |   | 15,848                                              |   |      |   | 4,840   |   |      |   | 19,673  |   |  |   | 13,631  |   |  |   | (13,834 | )
|                      
|                      
|                      
|                      
|                       | Total operating expense                                                 |  |   | 13,033                                              |   |      |   | 14,067  |   |      |   | 16,578  |   |  |   | 21,180  |   |  |   | 26,394  |  
|                       |                                                                         |  |   |                                                     |   |      |   |         |   |      |   |         |   |  |   |         |   |  |   |        
|                       | Net income before income tax and cumulative effect
of accounting change |  |   | 81,129                                              |   |      |   | 71,783  |   |      |   | 101,093 |   |  |   | 97,121  |   |  |   | 1,399   |  
|                      
|                      
|                      
|                      
|                       | Income Tax                                                              |  |   | 34                                                  |   |      |   |        |   |      |   | 36      |   |  |   | 65      |   |  |   | 35      |  
|                       |                                                                         |  |   |                                                     |   |      |   |         |   |      |   |         |   |  |   |         |   |  |   |        
|                       | Net income before cumulative effect of accounting
changes               |  |   | 81,095                                              |   |      |   | 71,783  |   |      |   | 101,057 |   |  |   | 97,056  |   |  |   | 1,364   |  
|                      
|                      
|                      
|                      
|                       | Cumulative effect of accounting changes                                 |  |   |                                                    |   |      |   |        |   |      |   |        |   |  |   |        |   |  |   | 1,129   |  
|                       |                                                                         |  |   |                                                     |   |      |   |         |   |      |   |         |   |  |   |         |   |  |   |        
|                       | Net income                                                              |  |   | 81,095                                              |   |      |   | 71,783  |   |      |   | 101,057 |   |  |   | 97,056  |   |  |   | 2,494   |  
|                      
|                      
|                      
|                      
|                       | Net income available to common stockholders                             |  |   | 79,697                                              |   |      |   | 70,386  |   |      |   | 99,687  |   |  |   | 95,770  |   |  |   | 1,137   |  

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##### Table of Contents



|                                     |                                                                                                                |                                   |        |                                                     |         |      |        |           |         |      |        |           |         |  |        |           |         |  |        |           |         | 
|------------------------------------ | -------------------------------------------------------------------------------------------------------------- | --------------------------------- | ------ | --------------------------------------------------- | ------- | ---- | ------ | --------- | ------- | ---- | ------ | --------- | ------- |  | ------ | --------- | ------- |  | ------ | --------- | ------- | 
|                                     |                                                                                                                |                                   |        | At and for the Year Ended December 31,             
|                                     |                                                                                                                |                                   |        |                                                    
|                                     |                                                                                                                |                                   |        | 1997                                                |         | 1998 |        | 1999      |         | 2000 |        | 2001     
|                                     |                                                                                                                |                                   |        |                                                     |         |      |        |           |         |      |        |          
|                                     |                                                                                                                |                                   |        | (in thousands, except per share amounts and ratios)
|                                    
|                                    
|                                    
|                                    
|Balance Sheet Data:                  |                                                                                                                |                                   |        |                                                     |         |      |        |           |         |      |        |           |         |  |        |           |         |  |        |          
|                                    
|                                    
|                                    
|                                    
|                                     | Investment securities                                                                                          |                                   |        | 199,165                                             |         |      |        | 163,935   |         |      |        | 178,816   |         |  |        | 395,459   |         |  |        | 362,098   |        
|                                    
|                                    
|                                    
|                                    
|                                     | Loans, net                                                                                                     |                                   |        | 5,122,477                                           |         |      |        | 4,984,397 |         |      |        | 4,457,266 |         |  |        | 4,806,392 |         |  |        | 4,536,105 |        
|                                    
|                                    
|                                    
|                                    
|                                     | Total assets                                                                                                   |                                   |        | 5,746,073                                           |         |      |        | 5,587,726 |         |      |        | 5,172,132 |         |  |        | 5,660,682 |         |  |        | 5,925,436 |        
|                                    
|                                    
|                                    
|                                    
|                                     | Total deposits                                                                                                 |                                   |        | 1,687,773                                           |         |      |        | 1,705,997 |         |      |        | 1,617,174 |         |  |        | 1,743,842 |         |  |        | 1,571,359 |        
|                                    
|                                    
|                                    
|                                    
|                                     | Short-term borrowings & placements                                                                             |                                   |        | 1,962,762                                           |         |      |        | 1,883,629 |         |      |        | 1,520,971 |         |  |        | 1,509,880 |         |  |        | 1,823,324 |        
|                                    
|                                    
|                                    
|                                    
|                                     | Medium & long-term borrowings & placements                                                                     |                                   |        | 1,423,033                                           |         |      |        | 1,269,598 |         |      |        | 1,212,566 |         |  |        | 1,582,479 |         |  |        | 1,787,161 |        
|                                    
|                                    
|                                    
|                                    
|                                     | Total liabilities                                                                                              |                                   |        | 5,170,574                                           |         |      |        | 4,963,999 |         |      |        | 4,474,809 |         |  |        | 4,945,666 |         |  |        | 5,311,786 |        
|                                    
|                                    
|                                    
|                                    
|                                     |                                                                                                                | Total common stockholders equity |        |                                                     | 558,254 |      |        |           | 606,506 |      |        |           | 680,429 |  |        |           | 699,205 |  |        |           | 598,418 | 
|                                    
|                                    
|                                    
|                                    
|Average number of shares outstanding |                                                                                                                |                                   | 20,307 |                                                     |         |      | 20,305 |           |         |      | 20,141 |           |         |  | 19,783 |           |         |  | 18,102 |          
|                                    
|                                    
|                                    
|                                    
|Per Common Share Data:               |                                                                                                                |                                   |        |                                                     |         |      |        |           |         |      |        |           |         |  |        |           |         |  |        |          
|                                    
|                                    
|                                    
|                                    
|                                     | Net income, after Preferred Stock dividend and
before cumulative effect of accounting change                   |                                   |        | 3.92                                                |         |      |        | 3.47      |         |      |        | 4.95      |         |  |        | 4.83      |         |  |        | 0.00      |        
|                                    
|                                    
|                                    
|                                    
|                                     | Diluted earnings per share before cumulative
effect of accounting change                                       |                                   |        | 3.92                                                |         |      |        | 3.46      |         |      |        | 4.93      |         |  |        | 4.81      |         |  |        | 0.00      |        
|                                    
|                                    
|                                    
|                                    
|                                     | Net income, after Preferred Stock dividend and
after cumulative effect of accounting change                    |                                   |        | 3.92                                                |         |      |        | 3.47      |         |      |        | 4.95      |         |  |        | 4.83      |         |  |        | 0.06      |        
|                                    
|                                    
|                                    
|                                    
|                                     | Diluted earnings per share after cumulative
effect of accounting change                                        |                                   |        | 3.92                                                |         |      |        | 3.46      |         |      |        | 4.93      |         |  |        | 4.81      |         |  |        | 0.06      |        
|                                    
|                                    
|                                    
|                                    
|                                     | Book value (period end)                                                                                        |                                   |        | 27.42                                               |         |      |        | 29.93     |         |      |        | 34.08     |         |  |        | 36.37     |         |  |        | 34.43     |        
|                                    
|                                    
|                                    
|                                    
|                                     | Cash dividends per share (3)                                                                                   |                                   |        | 0.96                                                |         |      |        | 0.96      |         |      |        | 0.96      |         |  |        | 2.50      |         |  |        | 1.88      |        
|                                    
|                                    
|                                    
|                                    
|Selected Financial Ratios:           |                                                                                                                |                                   |        |                                                     |         |      |        |           |         |      |        |           |         |  |        |           |         |  |        |          
|                                    
|                                    
|                                    
|                                    
|Performance Ratios:                  |                                                                                                                |                                   |        |                                                     |         |      |        |           |         |      |        |           |         |  |        |           |         |  |        |          
|                                    
|                                    
|                                    
|                                    
|                                     | Return on average assets before cumulative effect
of accounting change                                         |                                   |        | 1.47                                                | %       |      |        | 1.33      | %       |      |        | 1.93      | %       |  |        | 1.92      | %       |  |        | 0.02      | %      
|                                    
|                                    
|                                    
|                                    
|                                     | Return on average assets after cumulative effect
of accounting change                                          |                                   |        | 1.47                                                | %       |      |        | 1.33      | %       |      |        | 1.93      | %       |  |        | 1.92      | %       |  |        | 0.04      | %      
|                                    
|                                    
|                                    
|                                    
|                                     | Return on average common stockholders equity
before cumulative effect of accounting change                    |                                   |        | 15.36                                               | %       |      |        | 12.21     | %       |      |        | 15.68     | %       |  |        | 13.98     | %       |  |        | 0.32      | %      
|                                    
|                                    
|                                    
|                                    
|                                     | Return on average common stockholders equity
after cumulative effect of accounting change                     |                                   |        | 15.36                                               | %       |      |        | 12.21     | %       |      |        | 15.68     | %       |  |        | 13.98     | %       |  |        | 0.16      | %      
|                                    
|                                    
|                                    
|                                    
|                                     | Net interest margin (4)                                                                                        |                                   |        | 1.70                                                | %       |      |        | 1.71      | %       |      |        | 2.15      | %       |  |        | 2.24      | %       |  |        | 2.00      | %      
|                                    
|                                    
|                                    
|                                    
|                                     | Net interest spread (4)                                                                                        |                                   |        | 1.00                                                | %       |      |        | 0.90      | %       |      |        | 1.30      | %       |  |        | 1.14      | %       |  |        | 1.32      | %      
|                                    
|                                    
|                                    
|                                    
|                                     | Total operating expenses to total average assets                                                               |                                   |        | 0.24                                                | %       |      |        | 0.26      | %       |      |        | 0.32      | %       |  |        | 0.42      | %       |  |        | 0.44      | %      
|                                    
|                                    
|                                    
|                                    
|                                     | Cash dividend payout ratio                                                                                     |                                   |        | 24.49                                               | %       |      |        | 27.67     | %       |      |        | 19.39     | %       |  |        | 51.65     | %       |  |        | 3,133.3   | %      
|                                    
|                                    
|                                    
|                                    
|Asset Quality Ratios:                |                                                                                                                |                                   |        |                                                     |         |      |        |           |         |      |        |           |         |  |        |           |         |  |        |          
|                                    
|                                    
|                                    
|                                    
|                                     | Non-accruing loans to total loan portfolio (5)                                                                 |                                   |        | 0.00                                                | %       |      |        | 0.00      | %       |      |        | 0.50      | %       |  |        | 0.28      | %       |  |        | 1.63      | %      
|                                    
|                                    
|                                    
|                                    
|                                     | Net charge-offs to total loan portfolio                                                                        |                                   |        | 0.00                                                | %       |      |        | 0.36      | %       |      |        | 0.12      | %       |  |        | 0.29      | %       |  |        | 0.21      | %      
|                                    
|                                    
|                                    
|                                    
|                                     | Allowance for loan losses to total loan
portfolio, net of unearned income                                      |                                   |        | 2.22                                                | %       |      |        | 2.08      | %       |      |        | 2.49      | %       |  |        | 2.08      | %       |  |        | 3.78      | %      
|                                    
|                                    
|                                    
|                                    
|                                     | Allowance for loan losses to non-accruing loans                                                                |                                   |        | n.a                                                 |         |      |        | n.a       |         |      |        | 495       | %       |  |        | 750       | %       |  |        | 230       | %      
|                                    
|                                    
|                                    
|                                    
|                                     | Allowance for losses on offbalance sheet credit
risks to total contingencies net of mark to
market guarantees |                                   |        | n.a                                                 |         |      |        | n.a       |         |      |        | 0.50      | %       |  |        | 1.62      | %       |  |        | 1.89      | %      
|                                    
|                                    
|                                    
|                                    
|Capital Ratios:                      |                                                                                                                |                                   |        |                                                     |         |      |        |           |         |      |        |           |         |  |        |           |         |  |        |          
|                                    
|                                    
|                                    
|                                    
|                                     | Common stockholders equity to total assets                                                                    |                                   |        | 9.72                                                | %       |      |        | 10.85     | %       |      |        | 13.16     | %       |  |        | 12.35     | %       |  |        | 10.10     | %      
|                                    
|                                    
|                                    
|                                    
|                                     | Tier 1 capital to risk-weighted assets (6)                                                                     |                                   |        | 17.19                                               | %       |      |        | 20.06     | %       |      |        | 24.53     | %       |  |        | 18.27     | %       |  |        | 15.70     | %      
|                                    
|                                    
|                                    
|                                    
|                                     | Total capital to risk-weighted assets (6)                                                                      |                                   |        | 18.98                                               | %       |      |        | 21.90     | %       |      |        | 26.40     | %       |  |        | 19.94     | %       |  |        | 17.35     | %      



---

|(1) |  | For information regarding the provision for loan losses, see Operating
and Financial Review and Prospects  Operating Results.                                                                                                                                                                                                                                       
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|   
|   
|(2) |  | For information regarding the impairment loss on securities see
Information on the Company  Business Overview  Loan Portfolio 
Impaired Securities.                                                                                                                                                                                                               
|   
|   
|   
|   
|(3) |  | In each of 1997, 1998 and 1999, the Bank declared and paid an annual
dividend of $0.96 per common share to holders of common stock. In 2000,
the Bank declared and paid an annual dividend of $1.25 per common share
and a special dividend of $1.25 per common share to holders of common
stock. In 2001, the Bank declared and paid a quarterly dividend of $0.47
per

5



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##### Table of Contents



|    |  | common share to holders of common stock for the four quarters of 2001 for
a total annual dividend of $1.88 per share for the year 2001.                                                                                                                                                                                                                                                                                       
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|   
|   
|(4) |  | For information regarding the calculation of net interest margin and net
interest spread, see Operating and Financial Review and Prospects 
Operating Results  Net Interest Income.                                                                                                                                                                                                                                       
|   
|   
|   
|   
|(5) |  | The Bank did not have any repossessed assets or troubled debt
restructuring as defined in Statement of Financial Accounting Standards
No. 15 at any of the dates indicated above.                                                                                                                                                                                                                                             
|   
|   
|   
|   
|(6) |  | Calculated using the Federal Reserve Boards 1992 fully phased in
risk-weighted capital guidelines. The Bank is not subject to the
risk-based capital or leverage requirements of the Federal Reserve Board.
In managements opinion, if such requirements did apply to the Bank, the
capital ratios for the Bank would be as presented. See Operating and
Financial Review and Prospects  Liquidity and Capital Resources.

Common Stockholders Equity

At December 31, 2001, the Banks total common stockholders equity was
$598.4 million compared to $699.2 million at December 31, 2000 and $680.4
million at December 31, 1999, representing 10.1%, 12.4% and 13.2%,
respectively, of the Banks total assets.

The following table presents information concerning the Banks capital
position at the dates indicated below.

|                           |                                                                  |   |                 |         |      |   |         |         |  |   |         |         | 
|-------------------------- | ---------------------------------------------------------------- | - | --------------- | ------- | ---- | - | ------- | ------- |  | - | ------- | ------- | 
|                           |                                                                  |   | At December 31,
|                           |                                                                  |   |                
|                           |                                                                  |   | 1999            |         | 2000 |   | 2001   
|                           |                                                                  |   |                 |         |      |   |        
|                           |                                                                  |   | (in thousands) 
|                           |                                                                  |   |                 |         |      |   |         |         |  |   |         |        
|                          
|                          
|                          
|                          
|Redeemable Preferred Stock |                                                                  | $ | 16,894          |         |      | $ | 15,810  |         |  | $ | 15,232  |        
|                           |                                                                  |   |                 |         |      |   |         |         |  |   |         |        
|Common Stock               |                                                                  |   | 133,218         |         |      |   | 132,852 |         |  |   | 133,218 |        
|                          
|                          
|                          
|                          
|Treasury Stock             |                                                                  |   |                |         |      |   | (20,841 | )       |  |   | (85,634 | )      
|                          
|                          
|                          
|                          
|Capital Surplus            |                                                                  |   | 144,362         |         |      |   | 144,522 |         |  |   | 145,456 |        
|                          
|                          
|                          
|                          
|Capital Reserves           |                                                                  |   | 305,210         |         |      |   | 305,210 |         |  |   | 305,210 |        
|                          
|                          
|                          
|                          
|Other Comprehensive Income |                                                                  |   |                |         |      |   |        |         |  |   | (506    | )      
|                          
|                          
|                          
|                          
|Retained Earnings          |                                                                  |   | 98,009          |         |      |   | 137,462 |         |  |   | 100,674 |        
|                           |                                                                  |   |                 |         |      |   |         |         |  |   |         |        
|                           | Total Common Stockholders Equity                                |   | $               | 680,429 |      |   | $       | 699,205 |  |   | $       | 598,418 | 
|                           |                                                                  |   |                 |         |      |   |         |         |  |   |         |        
|                           | Total Common Stockholders
Equity and Redeemable Preferred
Stock |   | $               | 697,323 |      |   | $       | 715,015 |  |   | $       | 613,650 | 
|                           |                                                                  |   |                 |         |      |   |         |         |  |   |         |        

Capital reserves are established by the Bank from retained earnings and
are a form of retained earnings according to Panamanian banking regulations.
The objective of capital reserves is to strengthen the capital position of the
Bank, as reductions of these reserves require the approval of the Board of
Directors of the Bank (the Board of Directors) and Panamanian banking
authorities.

The increase in common stockholders equity in 2000 was due primarily to
an increase in retained earnings. The decrease in common stockholders equity
in 2001 was due primarily to the stock repurchase program and an increased
dividend payout ratio approved by the Board of Directors in December 2000. On
February 5, 2002, the Board of Directors suspended dividends on common shares
believing that it was in the best interest of the shareholders to conserve the
Banks capital resources until there was more clarity regarding the Banks
exposure in Argentina.

In July 1998, the Board of Directors approved a program under which the
Bank would offer to repurchase up to 200,000 of its Class B shares of common
stock at a price per share not to exceed 90% of the market value of the Banks
Class E shares of common stock (as quoted on the New York Stock Exchange on the
date of purchase). The first and second repurchase offers were completed for
100,000 shares each in December 1998 at a price of $14.50 per share for a total
amount of $1.5 million and in March 1999 at a price of $16.00 per share for a
total amount of $1.6 million, respectively. Upon repurchase, these Class B
shares were cancelled by the Bank.

In October 1999, the Board of Directors approved a program in which the
Bank would offer to repurchase up to 400,000 of its Class B shares at a price
per share not to exceed 90% of the market price of the Class E shares (as
quoted on the New York Stock Exchange on the date of purchase) or the average
per share book value of all

6



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##### Table of Contents



shares of the Banks common stock. The first and only repurchase offer
under this program was made for 200,000 shares on November 12, 1999 and was
completed at a price of $17.70 per Class B share for a total amount of $3.5
million. Upon repurchase, these Class B shares were cancelled by the Bank.

During the year 2000, the Board of Directors approved repurchases by the
Bank, at the discretion of management, of up to 2,000,000 Class B shares (at
the prevailing per share market price of the Class E shares on the date of
purchase) from shareholders that requested conversion of their Class B shares
into Class E shares. The Bank repurchased an aggregate of 568,010 Class B
shares for $15.7 million under this program prior to its cancellation in
December 2000. Upon repurchase, these Class B shares were not cancelled by the
Bank and were, accordingly, classified as treasury stock.

In December 2000, the Board of Directors approved a stock repurchase
program, an increased dividend payout ratio and a plan to declare and pay
dividends on a quarterly basis, rather than annually. Under the repurchase
program, the Bank may, from time to time, at the discretion of management,
purchase up to an aggregate of $75,000,000 of Class E shares on the open market
at the then prevailing market price. The Bank may also make one or more
repurchases of up to an aggregate of $25,000,000 of Class A shares of common
stock in privately negotiated transactions at the then prevailing market price
of the Class E shares. Any repurchases of Class A shares from a Class A
shareholder may not exceed 25% of the number of Class A shares owned by such
Class A shareholder. On November 8, 2001, the Board of Directors halted the
Banks share repurchase program, believing that it is in the best interests of
shareholders to conserve the Banks capital resources until the probable
outcome of the Banks exposure to Argentina is more clear (see
  Risk Factors  Regional Economic Conditions). During the years ended December 31, 2001 and
2000, the Bank repurchased the following shares under this program:

|        |  |              |           |        |  |        |            |        |  |  |         |  |  |   |           | 
|------- |  | ------------ | --------- | ------ |  | ------ | ---------- | ------ |  |  | ------- |  |  | - | --------- | 
|        |  | December 31,
|        |  |             
|        |  | 2001         |           | 2000  
|        |  |              |           |       
|        |  | Shares       |           | Amount |  | Shares |            | Amount
|        |  |              |           |        |  |        |            |       
|Class A |  |              | 269,843   |        |  | $      | 9,222,575  |        |  |  | 48,297  |  |  | $ | 1,485,144 | 
|       
|       
|       
|       
|Class E |  |              | 1,633,205 |        |  |        | 55,570,235 |        |  |  | 117,300 |  |  |   | 3,700,521 | 
|        |  |              |           |        |  |        |            |        |  |  |         |  |  |   |           | 
|        |  |              | 1,903,048 |        |  | $      | 64,792,811 |        |  |  | 165,597 |  |  | $ | 5,185,665 | 
|        |  |              |           |        |  |        |            |        |  |  |         |  |  |   |           | 

The Banks policy with respect to its capital position is to maintain a
minimum capital ratio of total common stockholders equity to total assets of
7%. At December 31, 2001, this ratio was 10%. In addition, the Bank has
established an internal policy of maintaining minimum Tier 1 and total capital
to risk weighted asset ratios of 10% and 12.5%, respectively, as defined by the
United States Board of Governors of the Federal Reserve System (the Federal
Reserve Board) and BIS capital adequacy requirements, although the Bank is not
subject to these risk weighted capital requirements. However, if the Federal
Reserve Boards fully phased in risk-based capital guidelines had been
applicable to the Bank, management believes that as of December 31, 2001 the
Bank would have exceeded all applicable capital adequacy requirements. At
December 31, 2001, the Banks Tier 1 and total capital ratios calculated
according to these guidelines were 15.7% and 17.4%, respectively. The Banking
Law (as defined under Information on the Company  Business Overview 
Regulation) in Panama, which became effective on June 12, 1998, requires the
Bank to maintain minimum total capital to risk weighted asset ratios of 8%
(each, as defined in the Banking Law). At December 31, 2001, the Banks total
capital to risk weighted asset ratio, calculated according to the guidelines of
the Banking Law, was 13.8%. See Information on the Company  Business
Overview  Regulation  Panamanian Law.

As described under Risk Factors  Regional Economic Conditions, the Bank
has determined to increase its allowance for credit losses (which includes
allowances for the Banks entire credit portfolio) and impairment losses on
securities as of June 30, 2002 to approximately $510 million, of which
approximately $420 million will relate to its Argentine portfolio. At June 21,
2002, the Banks total exposure to Argentina was $920 million (net of
impairment losses on securities of $40 million taken in 2001).

7



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##### Table of Contents



It is anticipated that the resulting charge against earnings and loss will
have the effect of reducing the Banks earnings for the second quarter of 2002
by approximately $295 million. At March 31, 2002, the Banks allowance for
credit losses amounted to $215 million. The exact amount of this increase, and
the corresponding charge against earnings, will be determined prior to and
announced in connection with the release of the Banks second quarter results
scheduled for late July or early August 2002. The Bank is formulating a
comprehensive strategy to address its ongoing capital and funding needs,
including a plan to recapitalize the Bank with additional equity capital.

Risk Factors

Regional Economic Conditions

All of the Banks lending activities are conducted with borrowers in Latin
America and the Caribbean (the Region). At various times in the past, and
particularly during the 1980s, many of the countries in the Region have
experienced severe economic difficulties, including periods of slow or negative
growth, large government budget deficits, high inflation, currency devaluation
and unavailability of foreign exchange, including dollars. As a result, many
governments and public and private institutions in the Region were unable to
make interest and principal payments on their external debt. Much of the
external debt of the Region was restructured to provide for extensions of
repayment schedules, grace periods during which payments of principal were
suspended and, in certain cases, reduced rates of interest.

These difficulties have arisen again, particularly in Argentina where an
economic crisis has resulted in a default on the countrys external debt. The
Argentine crisis has had a significant adverse effect on the Banks financial
condition and results of operations, and there is no assurance that future
developments in the political and economic situation of the countries in the
Region, over which the Bank has no control, will not further adversely affect
market conditions for the Banks funding or securities, or its business,
financial condition, results of operation or prospects.

During 2001, the U.S economy suffered a recession, and was further
adversely affected by the attack on New Yorks World Trade Center. This had a
significant adverse economic effect on the economies of the Latin American
countries in which the Bank conducts its lending activities.

Argentina. A prolonged deterioration in Argentinas economic and
political environment, financial condition and investor confidence, resulted in
late December 2001 in a profound crisis which forced the Argentine government
to adopt stringent measures, including foreign exchange and deposit controls,
bank holidays, and restrictions on the repayment of foreign debt. Given the
lack of a clearly defined and comprehensive fiscal, monetary and banking policy
framework and the continuing volatility of Argentinas political and financial
situation, there is great uncertainty as to how or when the situation will be
resolved.

The Banks exposure to Argentina amounted to $1.1 billion at December 31,
2001, including loans of $804 million, $80 million of securities (net of
impairment losses of $40.4 million) and $234 million of off-balance sheet
financial risk instruments. This exposure represents a reduction of 27% from
December 31, 2000, and is distributed among the countrys top tier local banks
(12%), local corporations (14%), state-owned banks (24%), multinational
corporations (23%), and international banks (27%, of which 70% represents
subsidiaries and 30% represents branches). In addition, the Bank at December
31, 2001 had $292 million of exposure under repurchase agreements with
counterparties in Argentina, which were fully secured with U.S. Treasury
securities. The Bank does not hold Argentine sovereign debt and 49% of the
Banks exposure in Argentina at December 31, 2001 was considered trade-related
transactions.

The deterioration of the Argentine economy, reflecting four years of
economic recession, and the current crises, have adversely affected the
financial condition of the Banks Argentine obligors, including banks and
corporations, and the quality of the Banks loans to those obligors. In
response, the Bank has put in place a pragmatic collection program to manage
its Argentine exposure. The Banks multilateral status, confirmed by the
Central Bank of Argentina at the end of February 2002, exempts the Bank from
limitations on the convertibility

8



---



##### Table of Contents



and transfer abroad of U.S. dollars for payment of external
obligations, thereby contributing to the on-going efforts of this program.

As a result, the Banks exposure to Argentina at June 21, 2002 amounted to
approximately $920 million, which represented a reduction of $198 million from
December 31, 2001 and a reduction of $40 million from March 31, 2002. All of
the Banks exposure in Argentina continues to be denominated in U.S. dollars
(with a small portion in Japanese yen) as none of the Banks loans in Argentina
have been converted to an Argentine peso basis. During the year 2002, the Bank collected interest from Argentine borrowers
of approximately $27 million while interest in the amount of $2.7 million on
non-accruing and accruing assets remained unpaid at June 21, 2002. The Bank intends to place all
loans and investments in Argentina on non-accrual status at June 30, 2002. Fees
generated by contingencies in Argentina will also be accounted for on a cash
basis.

Even with the benefit of the Banks confirmed multilateral status, given
the continued severity of the Argentine crises, the Bank believes that it will
have to renegotiate and restructure loans, and that it will also face
write-offs in its Argentine portfolio. In the absence of any clarity as to the
timing or nature of the ways in which the many issues facing the country will
be resolved, the Banks management and Board of Directors have determined to
take a conservative position relative to the Banks credit portfolio in
Argentina.

At December 31, 2001, the Bank had a total allowance for credit losses
(including loans and contingencies) of $195 million, reflecting additional provisions
taken in 2001 of $77 million. In addition, the Bank charged $40 million to
earnings in 2001 for impairment losses on securities from Argentina.

After careful consideration, and based upon rigorous analysis of all the
relevant factors, the Banks Board of Directors has determined to further
increase the allowance for credit losses and impairment losses on securities to
approximately $510 million, of which approximately $420 million will relate to
its Argentine portfolio. The exact amount of this increase, and the
corresponding charge against earnings, will be determined prior to and
announced in connection with the release of the Banks second quarter results
scheduled for late July or early August 2002.

As part of this decision, the Bank is formulating a comprehensive
strategy, with the assistance of financial advisors, designed to address the
Banks capital and funding needs following the contemplated increase of the
credit loss allowance for Argentina. This strategy will include a plan to
recapitalize the Bank with additional equity capital. The Bank has retained
BNP Paribas Securities Corp. and Deutsche Bank Securities Inc. as financial
advisors to assist with this process. The Bank and its advisors are
coordinating with the Banks credit rating agencies, multilateral organizations
and public sector shareholders in formulating this recapitalization plan.

The Bank believes that these steps will adequately address the likely
impact of the Argentine situation on the Banks loan portfolio and that the
Bank will remain in a strong financial position. There can be no assurance,
however, that the Bank will be successful in executing any recapitalization
plan or that the political and economic situation in Argentina or any other
major country, will not deteriorate further and require additional action.

The Bank will continue to monitor developments in Argentina closely and
take the appropriate additional steps as more information and clarity on the
Argentine governments actions regarding external debt and their effect on the
Bank become available.

Brazil. Investors have recently become increasingly uneasy about Brazil
due to, among other factors, a reduction in flows of direct foreign investments
and an increasingly uncertain political environment in light of the upcoming
2002 presidential elections. This has resulted in the rapid decline in the
value of Brazils currency compared to the U.S. dollar and speculation about
the ability of Brazil to service its approximately $290 billion of public debt,
much of which must be refinanced in the next several years.

The Bank is proactively managing its exposure in Brazil in line with its
conservative credit risk and portfolio management strategy. The Banks exposure
to Brazil amounted to $2,461 million at December 31, 2001

9



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##### Table of Contents



and at June 21, 2002 had decreased to approximately $1,671 million. At
the present time, all of the Banks loans to Brazilian borrowers are current
and there are no past due amounts of interest or principal.

Adequacy of Allowances for Credit Losses

As indicated above, the Bank has determined to increase its allowance for
credit losses and impairment losses on securities to approximately $510
million, of which approximately $420 million will relate to its Argentine portfolio. At June
21, 2002, the Banks total exposure to Argentina was $920 million (net of
impairment losses on securities of $40 million taken in 2001). Management will
continue to maintain the allowance for credit losses at a level, which reflects
the potential for political and economic instability in countries in the Region
and economic cycles. The determination of the appropriate level of allowances
for credit losses necessarily requires managements judgment, including
assumptions and estimates made in the context of rapidly changing political and
economic conditions in many of the countries in the Region. Accordingly, there
is no assurance that the Banks current level of reserves will prove to be
adequate in light of current and future events.

Funding Issues Resulting from the Argentine Situation

During the first quarter of 2002, the major rating agencies downgraded the
Banks credit ratings due to the crisis in Argentina and its potential impact
on the Banks credit exposure in that country. As of the date hereof, the Bank
has long-term debt ratings of Baa3 from Moodys Investors Services, Inc.
(Moodys), BBB- from Standard & Poors Ratings Services, a division of The
McGraw-Hill Companies, Inc. (Standard & Poors) and BBB- from Fitch IBCA,
Inc. (Fitch) and short-term debt ratings of Prime 3, A-3 and F-3 from
Moodys, Standard & Poors and Fitch, respectively. The Baa3 rating from
Moodys and the BBB- rating from Standard & Poors and Fitch are investment
grade ratings. The Bank follows a conservative liquidity management strategy
and in view of the volatility in the Region began gradually increasing its net cash
position in the second quarter of 2001, reaching a level of approximately $600
million in January 2002, which has been maintained since that time. At May 31,
2002, liquidity levels amounted to $592 million compared to $314 million at
December 31, 2000. At May 31, 2002, the Banks net cash position represented
almost 80% of total deposits. There is no assurance that a further
deterioration of the Argentine situation or difficulties in other countries in
the Region where the Bank has large exposures will not trigger further
downgrades in the Banks credit ratings below investment grade ratings, which
would adversely affect the Banks cost of funds, its deposit base and
accessibility to the debt capital markets.

Concentration of Lending and Funding Activities

At December 31, 2001, approximately 81% in principal amount of the Banks
total credits were outstanding to borrowers in five countries: Brazil (39%),
Argentina (18%), Mexico (17%), Venezuela (4%), and the Dominican Republic (3%).
In addition, at December 31, 2001, 24% of the Banks total loans were to seven
borrowers in Brazil and 9% of the Banks total loans were to three borrowers in
Mexico. A significant deterioration (or further deterioration) of economic
conditions in any of the countries listed above or of the financial condition
of any of these borrowers could adversely affect the financial condition and
results of operations of the Bank.

One of the Banks sources of funding for its short-term loans is interbank
deposits received principally from central banks in the Region. Historically,
these deposits have represented approximately 35% of total liabilities. If any
of these central banks were to withdraw a substantial portion of its deposits
with the Bank, the Banks liquidity could be adversely affected, although the
Bank believes that it has adequate sources of liquidity to cover any such
withdrawals. During the first five months of 2002, deposits declined by 52%
from $1,571 million at December 31, 2001 to $746 million at May 31, 2002.
Despite this decline in deposits, the Bank was able to maintain its net cash
position of around $600 million throughout 2002 owing to, among other things,
the repayment of loans funded with these deposits, reflecting the matched
nature of the Banks loans and deposits. As of May 31, 2002, deposits
represented 19% of total liabilities, with the balance composed of short-term
obligations primarily from international banks and medium term obligations
primarily from the debt capital

10



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##### Table of Contents



markets. Because Panama does not issue its own paper currency, the Banco
Nacional de Panama does not act as a central bank in the traditional sense and
is not a lender of last resort to the banking system in Panama. Accordingly,
if the Bank faced a liquidity crisis, it would have to rely on commercial
sources of liquidity and would not have access to a central bank lender of last
resort, as would a bank located in the United States or in certain other
countries.

Shares Eligible for Future Sale

Sales of substantial amounts of the Banks Class E shares in the public
market could adversely affect the market price of such Class E shares. At the
Banks annual shareholders meeting held on April 28, 2000 (the 2000 Annual
Meeting), shareholders approved all amendments proposed in the amended and
restated Articles of Incorporation of the Bank (the 2000 Amended and Restated
Articles of Incorporation). In adopting the 2000 Amended and Restated
Articles of Incorporation, the shareholders approved three significant changes
thereto, including a change in the capital structure of the Banks shares of
common stock. This change consolidated the Banks Class B and Class C shares
of common stock into a single class represented by new Class B shares of common
stock and made such new Class B shares of common stock convertible at the
option of the applicable shareholder, on a share-for-share basis, into the
existing Class E shares. The holders of the new Class B shares may at any
time, and with no limitation, exchange Class B shares for Class E shares, at a
rate of one (1) Class B share for one (1) Class E share.

As of May 31, 2002, the conversion of all of the currently outstanding
Class B shares would result in the issuance of approximately 3,842,479
additional Class E shares. As of the date of this Annual Report, a total of 55
Class B stockholders have converted 1,098,918 Class B shares for the same
number of Class E shares. The conversion of a substantial number of Class B
shares, or the availability of such shares for conversion and sale in the
market, may adversely affect the market and price for Class E shares.

Competition

The Bank faces strong competition in making loans, attracting deposits and
providing fee-generating services. The Banks competition in making loans
comes principally from regional and international commercial banks. The Bank
competes in its lending and deposit taking activities with other banks and
international financial institutions, many of which have greater financial and
other resources. See Information on the Company  Competition.

Market Risk

The Banks risk management policies 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. The Banks primary market
risks are comprised of liquidity risk and interest rate risk and, to a lesser
extent, currency exchange risk and price risk. See Quantitative and
Qualitative Disclosure About Market Risk and Operating and Financial Review
and Prospects  Liquidity and Capital Resources,  Asset/Liability Management,
and  Interest Rate Sensitivity.

Political Events in Panama

The government of Panama is a republican and presidential system with a
legislative body and an independent judiciary branch. In May 1999,
presidential elections took place in an orderly fashion. The new
democratically elected government was installed in September 1999. The country
has experienced a significant economic recovery since its return to democracy
in 1990. According to official Panamanian government figures, Panamas Gross
Domestic Product (GDP) grew in 1999 by an estimated 3.2%, in 2000 by an
estimated 2.7% and in 2001 by an estimated 0.3%; however, there can be no
assurance that such economic growth will be sustained. Panama has used the
U.S. dollar as legal tender currency since its independence in 1903 and is,
therefore, subject to fluctuations in the value of the U.S. dollar. Should any
significant political crisis occur in Panama in the future, the operations of
the Bank may be adversely affected.

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Item 4. Information on the Company

History and Development of the Company

The Bank, headquartered in Panama City, Panama, is a specialized
multinational bank established to finance trade in the Region. The Bank was
established pursuant to a May 1975 proposal of the XX 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 incorporated under the laws of the Republic of Panama (Panama)
on November 30, 1977 and continues to exist thereunder. Panama was selected as
the location of the Banks headquarters because of the importance of the
country as a banking center, the unrestricted circulation in Panama of the U.S.
dollar, the absence of exchange controls, the geographic location of Panama and
the quality of its communications facilities. Under special legislation
enacted in 1978, the Bank was granted certain privileges by the government of
Panama, including an exemption from the payment of income taxes in Panama. The
Bank is considered a regional risk rather than a Panamanian risk by the Federal
Reserve Board. Management believes that this classification is based upon the
Banks ownership structure and the absence of Panamanian concentration in the
Banks loan portfolio. The central banks of France, the United Kingdom and
Spain do not consider the Bank a Panamanian country risk. The Bank began
business operations on January 2, 1979. The Bank commenced operations with
common stockholders equity of $25 million paid by 186 stockholders. Since
then, the Banks common stockholders equity has increased to $598 million at
December 31, 2001.

Banco Latinoamericano de Exportaciones, S. A. (in its individual capacity,
BLADEX PANAMA) has three primary subsidiaries: Banco Latinoamericano de
Exportaciones, Limited (BLADEX) (BLADEX Cayman), BLADEX Representacao Ltda.
and BLADEX Holdings Inc. (BLADEX Holdings). BLADEX Cayman, which is a wholly
owned subsidiary, was incorporated under the laws of the Cayman Islands
(B.W.I.) (the Cayman Islands) on September 8, 1987 and continues to exist
thereunder. BLADEX Representacao Ltda., which was incorporated under the laws
of Brazil on January 7, 2000 and continues to exist thereunder, was established
to operate the Banks representative office in Brazil. BLADEX Representacao
Ltda. is 99.999% owned by BLADEX Panama and 0.001% owned by BLADEX Cayman.
BLADEX Holdings, which is a wholly owned subsidiary, was incorporated under the
laws of the state of Delaware on May 30, 2000 and continues to exist
thereunder. BLADEX Holdings has a wholly-owned subsidiary, BLADEX Financial
Services, LLC, incorporated under the laws of the state of New York on October
20, 2000 and continues to exist thereunder. BLADEX Financial Services, LLC has
a wholly owned subsidiary, BLADEX Securities, LLC, which was established under
the laws of the state of New York on October 20, 2000 and continues to exist
thereunder.

The Bank established an agency in the State of New York (the New York
Agency) which began business operations on March 27, 1989. The New York
Agency, which continues to exist in the State of New York, is principally
engaged in obtaining inter-bank deposits and short-term borrowings to finance
the Banks short-term investments and foreign trade loans. Prior to the tragic
events that occurred in the United States on September 11, 2001, the New York
Agency and BLADEX Securities, LLC, were located at One World Trade Center,
Suite No. 3227, in New York City. On October 1, 2001, as a result of the
incidents of September 11, 2001, the Bank began leasing facilities for the New
York Agency and BLADEX Securities, LLC, at 641 Lexington Avenue, 32nd Floor,
New York, N.Y. 10022. The Bank also has a representative office in Buenos
Aires, Argentina and on November 29, 2000 opened a representative office in
Mexico City, Mexico.

Central banks from 23 countries in the Region, or governmental financial
institutions designated by such countries, own all of the Banks Class A
shares, which currently comprise 28% of the Banks common stock. Currently,
159 commercial banks in the Region own the Banks Class B shares, which
comprise 24% of the Banks common stock. The Banks Class E shares, which
comprise 48% of its common stock, are listed on the New York Stock Exchange.

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The Bank is principally engaged in providing short-term and medium-term
financing to selected commercial banks in the Region, which in turn lend to
businesses primarily engaged in foreign trade and to state and private export
institutions. As of December 31, 2001, the Bank provided financing to
approximately 57 of its 182 stockholder banks and to 150 non-stockholder
institutions. The Bank also lends directly to non-bank private entities, most
of which are engaged in foreign trade in the Region, primarily through
co-financing and loan syndications with other banks. The majority of the
Banks short-term financing is extended in connection with specific foreign
trade transactions that have been identified by the Bank.

At the 2000 Annual Meeting, shareholders approved the 2000 Amended and
Restated Articles of Incorporation, an English translation of which was
attached to the Banks annual report on Form 20-F for the financial year ended
December 31, 1999, which made three significant changes. The first significant
change broadened the Banks powers to meet the evolving requirements of the
Latin American and international markets in which it operates by restating and
expanding the Banks primary purpose from promoting foreign trade to promoting
the economic development of Latin American countries, mainly through foreign
trade. This allowed the Bank to introduce new products and services while
preserving and building upon its original mission to support the growth of
trade finance in the Region. The intended result was that the Bank would be a
more competitive company and be better able to develop its market position.

The second significant change approved by the shareholders at the 2000
Annual Meeting was a change in the composition of the Banks Board of Directors
to allow for representation by members of the Board of Directors (each, a
Director) of various classes of shares to be proportionate to the
distribution of capital by class. Pursuant to the 2000 Amended and Restated
Articles of Incorporation, the number of Directors comprising the Board of
Directors was reduced from 11 Directors prior to the approval of the 2000
Amended and Restated Articles of Incorporation, to nine Directors, in order to
have a more efficient Board of Directors. In addition, the 2000 Amended and
Restated Articles of Incorporation mandate that one of the candidates nominated
as a Director by the Board of Directors be the Chief Executive Officer of the
Bank, thereby allowing greater participation of the Banks management in the
decision and policymaking process. See Directors, Senior Management and
Employees.

The third significant change was to consolidate the Banks Class B and
Class C shares into a single class represented by new Class B shares and to
make the new Class B shares convertible at the option of the shareholder, on a
share-for-share basis, into the existing Class E shares, which trade on the New
York Stock Exchange. The option to convert the new Class B shares provides
for greater liquidity for the holders of Class B shares, as well as for the
holders of Class E shares, by increasing the number of Class E shares trading
on the New York Stock Exchange. Class E shares issued in exchange for Class B
shares which have not been outstanding for at least two years, are not (unless
they are registered by the Bank under the U.S. Securities Act of 1933, as
amended) freely tradable on the New York Stock Exchange until the end of a
two-year period, which begins when the Class B shares for which the new Class E
shares are exchanged were originally issued.

On April 16, 2002 at the Banks annual shareholders meeting (the 2002
Annual Meeting), shareholders approved an amendment to the 2000 Amended and
Restated Articles of Incorporation (as so amended, the Articles of
Incorporation) to change the structure and composition of the Banks Board of
Directors. Pursuant to the Articles of Incorporation, the number of Directors
comprising the Board of Directors was increased from nine Directors prior to
the approval of the amendment to the 2000 Amended and Restated Articles of
Incorporation, to ten Directors, in order to have a more efficient Board of
Directors.

The composition of the Board of Directors is as follows: three (3)
Directors representing holders of the Class A common shares; two (2) Directors
representing holders of the Class B common shares; three (3) Directors
representing holders of the Class E common shares; and two (2) Directors
representing all classes of common shares.

The Banks lending activities are funded by inter-bank deposits, primarily
from central banks and financial institutions in the Region, by short-term and
medium-term borrowings and by floating and fixed rate

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placements made with financial institutions and investors in Japan, Europe
and North America. The Bank does not provide retail-banking services to the
general public such as retail savings accounts or checking accounts and does
not take retail deposits.

Business Overview

Credit Portfolio and Lending Policies

The Banks Articles of Incorporation state that the Bank may not lend to
an institution in a country in the Region unless the central bank or a
designated government entity of that country is a holder of Class A shares of
the Bank. It generally has been an operating policy of the Bank to extend
credit directly to banks and state-owned export organizations within the
Region. The Bank also lends to non-bank private entities, mostly through
co-financing and loan participations with other banks. At December 31, 2001,
total loans outstanding to non-bank private entities constituted 19.9% of the
Banks total loans. All credit requests from eligible borrowers are analyzed
in the light of commercial criteria, including economic and market conditions.

One of the most important components of the Banks strategy is to maximize
its core business. This involves strengthening the operational and
technological base of the Bank and a re-engineering of many of its work
processes in order to become more efficient in an increasingly competitive
marketplace. During 2001, the Bank implemented initiatives to improve the
capabilities of its loan desk, implement a portfolio management approach to
optimize the return on its credit portfolio, originate and sell more assets
with better management of the risks involved, and improve the quality of client
service. To improve its capabilities and become more marketing oriented, the
Bank hired more specialized staff members, an investment the Bank believes is
essential for it to remain competitive in the market. Most of these
investments increased the Banks operating cost base in 2001 but, management
believes, provided the foundation for revenue growth in future years.

In 2001, a structured trade unit was created in New York within BLADEX
Securities, LLC and on May 23, 2001, BLADEX Securities, LLC received a
broker-dealer license from the National Association of Securities Dealers, Inc.
to buy and sell securities in the United States. During the second quarter of
2002, the Bank discontinued the operations of this unit due to, among other
things, changing market conditions that were not favorable to the development
of this business.

The Bank has 36 officers responsible for marketing the Banks financial
products and services to existing and potential customers. This includes the
personnel in its representative offices in Argentina, Brazil and Mexico, and
the New York Agency.

The Bank finances export and import transactions for all types of goods
and products, with the exception of the export or import of armaments,
ammunition, military equipment, hallucinogenic drugs or narcotics that are not
utilized for medical purposes, and any article the trading of which is widely
prohibited due to its environmental hazards or due to trading limitations
established by international agreements. Exports financed by the Bank are
destined for buyers in countries both inside and outside the Region. In the
same manner, imports financed by the Bank originate from sellers in countries
both inside and outside the Region.

At regular intervals (usually at least once a year), the Bank conducts a
credit review of each of its borrowers and of each country in the Region. The
Banks credit review includes an analysis of the borrowers financial
condition, trends in the borrowers financial condition, peer group
comparisons, a review of credit references and a review of general economic
conditions in the borrowers home country, and may include discussions with
bank regulatory authorities in the borrowers home country. On the basis of
its credit review, the Bank establishes credit limits for each country in the
Region and for each of its borrowers. In order to prevent excessive
concentration, the outstanding credit portfolio in a given country cannot
exceed the lesser of (i) 40% of the total credit portfolio of the Bank, (ii)
four times the Banks total capital (defined according to the Basle capital
adequacy principles), and (iii) the country limit established by management and
approved by the Board of Directors.

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All country credit limits, along with targeted customers, business plans
and risk profiles as to tenor and type of risk to be undertaken in a particular
country, are approved by the Board of Directors. The Board of Directors
reviews and approves the credit limits for each country in the Region at least
once a year. The Board of Directors also reviews and monitors the credit
portfolio of the Bank, including all criticized credits, at least every
quarter.

The Bank generally establishes lines of credit for each of its borrowers;
however, the Bank is not obligated to lend under such lines of credit and must
approve each lending transaction on a case-by-case basis. The Bank does not,
as a general rule, publish or communicate its lending limits for countries in
which it lends or its borrowers, but uses such limits internally as a credit
risk management tool. Once a line of credit has been established, credit is
generally extended after receipt of a request from the borrower for financing
that is usually related to foreign trade. The pricing for such loans is
determined in accordance with prevailing market conditions and the
credit-worthiness of the borrower.

For existing borrowers, the Banks management has authority to approve
credit lines up to the lending limit prescribed by Panamanian law (see
 Regulation  Panamanian Law), provided that such
credit lines are within the country credit limit for the borrowers country of
domicile approved by the Board of Directors. As of December 31, 2001, the
lending limit prescribed by Panamanian law for any one borrower amounted to
approximately $182 million. For new borrowers, the Banks management has
authority to approve credit lines of up to $60 million. Any approval of credit
lines by the Banks management is subject to the concurrence of the Banks
Credit Committee, which is comprised of the Banks Chief Executive Officer, the
Chief Operating Officer, and the heads of Risk Administration and Credit and
Marketing or their designees. In addition, the Banks management may approve
credit lines consisting of criticized credits of up $25 million for existing
borrowers. Credit lines to new borrowers exceeding $60 million and credit
lines to existing borrowers consisting of criticized credits exceeding $25
million must be approved by the Credit Policy and Risk Assessment Committee of
the Board of Directors. At December 31, 2001, approximately 46 of the Banks
existing 246 lines of credit required approval of the Credit Policy and Risk
Assessment Committee of the Board of Directors, representing approximately 34%
of the available amount under the Banks existing lines of credit.

The Banks general lending guidelines limit the amount of total credit
that may be extended to any borrower to (i) an amount ranging from 10% to 50%
of that borrowers equity, depending on the type of borrower and its
credit-worthiness, and the term and nature of the transaction, (ii) up to 30%
of the Banks total capital and reserves, depending on the type of borrower and
its credit-worthiness, and (iii) up to 5% of the Banks total outstanding
credit portfolio. The Board of Directors has made exceptions to the foregoing
policies with respect to some of the Banks borrowers and, subject to the
limits imposed by applicable law may make further exceptions in the future. As
a result of the Banks decision to increase its allowance for credit losses and
impairment losses on securities as of June 30, 2002 and the corresponding
reduction in the Banks earnings, the Bank expects to exceed this 30% limit
with respect to several borrowers. The Panamanian Banking Law also contains
certain concentration limits, which are strictly adhered to by the Bank. See 
 Regulation  Panamanian Law.

The Banks loans are generally unsecured. However, in certain instances,
based upon its credit review of the borrower and the economic and political
situation and trends in the borrowers home country, the Bank has determined
that the level of risk involved requires that a loan be secured by pledged
deposits. The Bank has also in some instances either obtained an assignment of
the trade related transaction documents and proceeds of the export transaction,
such that the importer is obligated to make payments for the exported goods
directly to the Bank, or obtained other appropriate collateral.

The Bank is also engaged in lending transactions not related to trade
finance in order to service demand and to complement its overall credit
relationship with high quality borrowers. The Bank has developed credit
information on its borrowers over an extended period of time. Many of the
Banks borrowers have been customers and stockholders for periods of over ten
years. At December 31, 2001, total non-trade-related loans amounted to $1,555
million or 33% of the Banks total loans.

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Credit Portfolio by Country

The following table sets forth information regarding the credit portfolio
of the Bank by country at December 31 of each year set forth below.

|                   |       |   |                                   |       |   |  |      |       |   |   |       |       |   |  |      |       |   |   |       |       |   |  |      |       |  |   |       |       |  |  |      |       |  |   |       |       |  |  |      |       | 
|------------------ | ----- | - | --------------------------------- | ----- | - |  | ---- | ----- | - | - | ----- | ----- | - |  | ---- | ----- | - | - | ----- | ----- | - |  | ---- | ----- |  | - | ----- | ----- |  |  | ---- | ----- |  | - | ----- | ----- |  |  | ---- | ----- | 
|                   |       |   | At December 31,*                 
|                   |       |   |                                  
|                   |       |   | 1997                              |       | % |  | 1998 |       | % |   | 1999  |       | % |  | 2000 |       | % |   | 2001  |       | %
|                   |       |   |                                   |       |   |  |      |       |   |   |       |       |   |  |      |       |   |   |       |       |  
|                   |       |   | (in millions, except percentages)
|                   |       |   |                                   |       |   |  |      |       |   |   |       |       |   |  |      |       |   |   |       |       |   |  |      |       |  |   |       |       |  |  |      |       |  |   |       |       |  |  |      |      
|                  
|                  
|                  
|                  
|Argentina          |       | $ | 1,122                             |       |   |  | 15.9 |       |   | $ | 1,209 |       |   |  | 17.7 |       |   | $ | 1,198 |       |   |  | 19.6 |       |  | $ | 1,471 |       |  |  | 22.7 |       |  | $ | 1,114 |       |  |  | 17.4 |      
|                  
|                  
|                  
|                  
|Barbados           |       |   | 6                                 |       |   |  | 0.1  |       |   |   | 0     |       |   |  | 0.0  |       |   |   | 0     |       |   |  | 0.0  |       |  |   | 0     |       |  |  | 0.0  |       |  |   | 0     |       |  |  | 0.0  |      
|                  
|                  
|                  
|                  
|Bolivia            |       |   | 69                                |       |   |  | 1.0  |       |   |   | 50    |       |   |  | 0.7  |       |   |   | 66    |       |   |  | 1.1  |       |  |   | 21    |       |  |  | 0.3  |       |  |   | 26    |       |  |  | 0.4  |      
|                  
|                  
|                  
|                  
|Brasil             |       |   | 2,410                             |       |   |  | 34.2 |       |   |   | 2,346 |       |   |  | 34.4 |       |   |   | 2,159 |       |   |  | 35.3 |       |  |   | 2,351 |       |  |  | 36.2 |       |  |   | 2,461 |       |  |  | 38.5 |      
|                  
|                  
|                  
|                  
|Chile              |       |   | 157                               |       |   |  | 2.2  |       |   |   | 69    |       |   |  | 1.0  |       |   |   | 81    |       |   |  | 1.3  |       |  |   | 88    |       |  |  | 1.4  |       |  |   | 114   |       |  |  | 1.8  |      
|                  
|                  
|                  
|                  
|Colombia           |       |   | 367                               |       |   |  | 5.2  |       |   |   | 242   |       |   |  | 3.6  |       |   |   | 257   |       |   |  | 4.2  |       |  |   | 177   |       |  |  | 2.7  |       |  |   | 195   |       |  |  | 3.0  |      
|                  
|                  
|                  
|                  
|Costa Rica         |       |   | 23                                |       |   |  | 0.3  |       |   |   | 11    |       |   |  | 0.2  |       |   |   | 27    |       |   |  | 0.4  |       |  |   | 29    |       |  |  | 0.4  |       |  |   | 69    |       |  |  | 1.1  |      
|                  
|                  
|                  
|                  
|Dominican Republic |       |   | 122                               |       |   |  | 1.7  |       |   |   | 117   |       |   |  | 1.7  |       |   |   | 112   |       |   |  | 1.8  |       |  |   | 178   |       |  |  | 2.7  |       |  |   | 221   |       |  |  | 3.5  |      
|                  
|                  
|                  
|                  
|Ecuador            |       |   | 90                                |       |   |  | 1.3  |       |   |   | 69    |       |   |  | 1.0  |       |   |   | 94    |       |   |  | 1.5  |       |  |   | 113   |       |  |  | 1.7  |       |  |   | 95    |       |  |  | 1.5  |      
|                  
|                  
|                  
|                  
|El Salvador        |       |   | 55                                |       |   |  | 0.8  |       |   |   | 27    |       |   |  | 0.4  |       |   |   | 38    |       |   |  | 0.6  |       |  |   | 41    |       |  |  | 0.6  |       |  |   | 62    |       |  |  | 1.0  |      
|                  
|                  
|                  
|                  
|Guatemala          |       |   | 25                                |       |   |  | 0.4  |       |   |   | 23    |       |   |  | 0.3  |       |   |   | 19    |       |   |  | 0.3  |       |  |   | 42    |       |  |  | 0.7  |       |  |   | 28    |       |  |  | 0.4  |      
|                  
|                  
|                  
|                  
|Honduras           |       |   | 3                                 |       |   |  | 0.0  |       |   |   | 7     |       |   |  | 0.1  |       |   |   | 10    |       |   |  | 0.2  |       |  |   | 6     |       |  |  | 0.1  |       |  |   | 0     |       |  |  | 0.0  |      
|                  
|                  
|                  
|                  
|Jamaica            |       |   | 25                                |       |   |  | 0.4  |       |   |   | 13    |       |   |  | 0.2  |       |   |   | 18    |       |   |  | 0.3  |       |  |   | 18    |       |  |  | 0.3  |       |  |   | 19    |       |  |  | 0.3  |      
|                  
|                  
|                  
|                  
|Mexico             |       |   | 1,785                             |       |   |  | 25.4 |       |   |   | 1,784 |       |   |  | 26.2 |       |   |   | 1,494 |       |   |  | 24.5 |       |  |   | 1,380 |       |  |  | 21.3 |       |  |   | 1,062 |       |  |  | 16.6 |      
|                  
|                  
|                  
|                  
|Nicaragua          |       |   | 32                                |       |   |  | 0.5  |       |   |   | 23    |       |   |  | 0.3  |       |   |   | 46    |       |   |  | 0.8  |       |  |   | 38    |       |  |  | 0.6  |       |  |   | 43    |       |  |  | 0.7  |      
|                  
|                  
|                  
|                  
|Panama             |       |   | 51                                |       |   |  | 0.7  |       |   |   | 84    |       |   |  | 1.2  |       |   |   | 141   |       |   |  | 2.3  |       |  |   | 150   |       |  |  | 2.3  |       |  |   | 82    |       |  |  | 1.3  |      
|                  
|                  
|                  
|                  
|Paraguay           |       |   | 30                                |       |   |  | 0.4  |       |   |   | 16    |       |   |  | 0.2  |       |   |   | 1     |       |   |  | 0.0  |       |  |   | 2     |       |  |  | 0.0  |       |  |   | 1     |       |  |  | 0.0  |      
|                  
|                  
|                  
|                  
|Peru               |       |   | 482                               |       |   |  | 6.9  |       |   |   | 537   |       |   |  | 7.9  |       |   |   | 268   |       |   |  | 4.4  |       |  |   | 258   |       |  |  | 4.0  |       |  |   | 170   |       |  |  | 2.7  |      
|                  
|                  
|                  
|                  
|Trinidad & Tobago  |       |   | 26                                |       |   |  | 0.4  |       |   |   | 30    |       |   |  | 0.4  |       |   |   | 26    |       |   |  | 0.4  |       |  |   | 55    |       |  |  | 0.9  |       |  |   | 59    |       |  |  | 0.9  |      
|                  
|                  
|                  
|                  
|Uruguay            |       |   | 41                                |       |   |  | 0.6  |       |   |   | 73    |       |   |  | 1.1  |       |   |   | 23    |       |   |  | 0.4  |       |  |   | 7     |       |  |  | 0.1  |       |  |   | 0     |       |  |  | 0.0  |      
|                  
|                  
|                  
|                  
|Venezuela          |       |   | 32                                |       |   |  | 0.4  |       |   |   | 52    |       |   |  | 0.8  |       |   |   | 28    |       |   |  | 0.5  |       |  |   | 44    |       |  |  | 0.7  |       |  |   | 274   |       |  |  | 4.3  |      
|                  
|                  
|                  
|                  
|Other              |       |   | 85                                |       |   |  | 1.2  |       |   |   | 42    |       |   |  | 0.6  |       |   |   | 2     |       |   |  | 0.0  |       |  |   | 19    |       |  |  | 0.3  |       |  |   | 302   |       |  |  | 4.7  |      
|                   |       |   |                                   |       |   |  |      |       |   |   |       |       |   |  |      |       |   |   |       |       |   |  |      |       |  |   |       |       |  |  |      |       |  |   |       |       |  |  |      |      
|                   | Total |   | $                                 | 7,038 |   |  |      | 100.0 |   |   | $     | 6,824 |   |  |      | 100.0 |   |   | $     | 6,108 |   |  |      | 100.0 |  |   | $     | 6,488 |  |  |      | 100.0 |  |   | $     | 6,397 |  |  |      | 100.0 | 
|                   |       |   |                                   |       |   |  |      |       |   |   |       |       |   |  |      |       |   |   |       |       |   |  |      |       |  |   |       |       |  |  |      |       |  |   |       |       |  |  |      |      



---

|* |  | Includes loans, selected investment securities held to maturity, securities
purchased under agreements to resell, letters of credit, customers liabilities
under acceptances and guarantees. Amounts are net of impairment loss on
securities. See  Loan Portfolio  Asset Quality and  Impaired Assets.
|- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Loan Portfolio

At December 31, 2001, the Banks total loans net of unearned income
equaled $4,714 million or 80% of total assets. At December 31, 2001, net of
allowance for loan losses and unearned income, the Banks loans equaled $4,536
million, 65% of which matured within one year. The Bank services all loans in
its loan portfolio except syndicated loans, which are serviced through agent
banks that are generally appointed by the arrangers of the syndication.

Short-Term Loans

The majority of the Banks short-term financing is extended in connection
with specific foreign trade transactions that have been identified to the Bank.
At December 31, 2001, short-term loans defined as loans with a maturity of less
than one year, had an average term remaining to maturity of approximately 119
days. At that date, short-term loans amounted to $2,586 million or 54.6% of the
Banks total loans.

Medium-Term Loans

The Bank is engaged in medium-term lending in which maturities generally
range from one to five years. Medium-terms loans are extended primarily to
banks and to a lesser extent to state-owned and private export related
corporations in the Region. At December 31, 2001, the Banks medium-term loans
had an average term remaining to maturity of approximately two years and one
month. It is the Banks current policy to fund such medium-term lending
primarily with medium-term liabilities and to limit such lending to between 2%
(if the term to maturity is greater than five years) and 40% (if the term to
maturity is between twelve and eighteen months) of its total credit portfolio,
with additional percentage limitations (based on maturities) within that range.
At

16



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##### Table of Contents



December 31, 2001, medium-term loans amounted to $2,148 million or 45.4%
of the Banks total loans, of which $587 million had a remaining term to
maturity of less than 365 days.

Loans by Country

The following table sets forth the distribution of the Banks loans
(including short-term loans, medium-term loans and long-term loans) by country
at December 31 of each year set forth below:

|                   |       |   |                                   |       |   |  |      |       |   |   |       |       |   |  |      |       |   |   |       |       |   |  |      |       |  |   |       |       |  |  |      |       |  |   |       |       |  |  |      |       | 
|------------------ | ----- | - | --------------------------------- | ----- | - |  | ---- | ----- | - | - | ----- | ----- | - |  | ---- | ----- | - | - | ----- | ----- | - |  | ---- | ----- |  | - | ----- | ----- |  |  | ---- | ----- |  | - | ----- | ----- |  |  | ---- | ----- | 
|                   |       |   | At December 31,                  
|                   |       |   |                                  
|                   |       |   | 1997                              |       | % |  | 1998 |       | % |   | 1999  |       | % |  | 2000 |       | % |   | 2001  |       | %
|                   |       |   |                                   |       |   |  |      |       |   |   |       |       |   |  |      |       |   |   |       |       |  
|                   |       |   | (in millions, except percentages)
|                   |       |   |                                   |       |   |  |      |       |   |   |       |       |   |  |      |       |   |   |       |       |   |  |      |       |  |   |       |       |  |  |      |       |  |   |       |       |  |  |      |      
|                  
|                  
|                  
|                  
|Argentina          |       | $ | 968                               |       |   |  | 18.3 |       |   | $ | 957   |       |   |  | 18.7 |       |   | $ | 980   |       |   |  | 21.3 |       |  | $ | 1,128 |       |  |  | 22.9 |       |  | $ | 804   |       |  |  | 17.0 |      
|                  
|                  
|                  
|                  
|Barbados           |       |   | 6                                 |       |   |  | 0.1  |       |   |   | 0     |       |   |  | 0.0  |       |   |   | 0     |       |   |  | 0.0  |       |  |   | 0     |       |  |  | 0.0  |       |  |   | 0     |       |  |  | 0.0  |      
|                  
|                  
|                  
|                  
|Bolivia            |       |   | 59                                |       |   |  | 1.1  |       |   |   | 47    |       |   |  | 0.9  |       |   |   | 62    |       |   |  | 1.3  |       |  |   | 20    |       |  |  | 0.4  |       |  |   | 26    |       |  |  | 0.5  |      
|                  
|                  
|                  
|                  
|Brasil             |       |   | 1,927                             |       |   |  | 36.5 |       |   |   | 1,742 |       |   |  | 34.0 |       |   |   | 1,654 |       |   |  | 36.0 |       |  |   | 1,858 |       |  |  | 37.7 |       |  |   | 2,013 |       |  |  | 42.5 |      
|                  
|                  
|                  
|                  
|Chile              |       |   | 97                                |       |   |  | 1.8  |       |   |   | 64    |       |   |  | 1.3  |       |   |   | 76    |       |   |  | 1.7  |       |  |   | 83    |       |  |  | 1.7  |       |  |   | 112   |       |  |  | 2.4  |      
|                  
|                  
|                  
|                  
|Colombia           |       |   | 265                               |       |   |  | 5.0  |       |   |   | 161   |       |   |  | 3.2  |       |   |   | 207   |       |   |  | 4.5  |       |  |   | 119   |       |  |  | 2.4  |       |  |   | 138   |       |  |  | 2.9  |      
|                  
|                  
|                  
|                  
|Costa Rica         |       |   | 18                                |       |   |  | 0.3  |       |   |   | 10    |       |   |  | 0.2  |       |   |   | 23    |       |   |  | 0.5  |       |  |   | 24    |       |  |  | 0.5  |       |  |   | 67    |       |  |  | 1.4  |      
|                  
|                  
|                  
|                  
|Dominican Republic |       |   | 88                                |       |   |  | 1.7  |       |   |   | 88    |       |   |  | 1.7  |       |   |   | 57    |       |   |  | 1.2  |       |  |   | 103   |       |  |  | 2.1  |       |  |   | 175   |       |  |  | 3.7  |      
|                  
|                  
|                  
|                  
|Ecuador            |       |   | 62                                |       |   |  | 1.2  |       |   |   | 52    |       |   |  | 1.0  |       |   |   | 50    |       |   |  | 1.1  |       |  |   | 63    |       |  |  | 1.3  |       |  |   | 14    |       |  |  | 0.3  |      
|                  
|                  
|                  
|                  
|El Salvador        |       |   | 39                                |       |   |  | 0.7  |       |   |   | 13    |       |   |  | 0.3  |       |   |   | 24    |       |   |  | 0.5  |       |  |   | 25    |       |  |  | 0.5  |       |  |   | 19    |       |  |  | 0.4  |      
|                  
|                  
|                  
|                  
|Guatemala          |       |   | 18                                |       |   |  | 0.3  |       |   |   | 23    |       |   |  | 0.5  |       |   |   | 19    |       |   |  | 0.4  |       |  |   | 30    |       |  |  | 0.6  |       |  |   | 23    |       |  |  | 0.5  |      
|                  
|                  
|                  
|                  
|Honduras           |       |   | 0                                 |       |   |  | 0.0  |       |   |   | 1     |       |   |  | 0.0  |       |   |   | 0     |       |   |  | 0.0  |       |  |   | 0     |       |  |  | 0.0  |       |  |   | 0     |       |  |  | 0.0  |      
|                  
|                  
|                  
|                  
|Jamaica            |       |   | 17                                |       |   |  | 0.3  |       |   |   | 10    |       |   |  | 0.2  |       |   |   | 9     |       |   |  | 0.2  |       |  |   | 6     |       |  |  | 0.1  |       |  |   | 7     |       |  |  | 0.2  |      
|                  
|                  
|                  
|                  
|Mexico             |       |   | 1,169                             |       |   |  | 22.1 |       |   |   | 1,242 |       |   |  | 24.3 |       |   |   | 1,008 |       |   |  | 21.9 |       |  |   | 1,030 |       |  |  | 20.9 |       |  |   | 833   |       |  |  | 17.6 |      
|                  
|                  
|                  
|                  
|Nicaragua          |       |   | 26                                |       |   |  | 0.5  |       |   |   | 17    |       |   |  | 0.3  |       |   |   | 33    |       |   |  | 0.7  |       |  |   | 25    |       |  |  | 0.5  |       |  |   | 38    |       |  |  | 0.8  |      
|                  
|                  
|                  
|                  
|Panama             |       |   | 31                                |       |   |  | 0.6  |       |   |   | 66    |       |   |  | 1.3  |       |   |   | 120   |       |   |  | 2.6  |       |  |   | 118   |       |  |  | 2.4  |       |  |   | 43    |       |  |  | 0.9  |      
|                  
|                  
|                  
|                  
|Paraguay           |       |   | 30                                |       |   |  | 0.6  |       |   |   | 16    |       |   |  | 0.3  |       |   |   | 1     |       |   |  | 0.0  |       |  |   | 1     |       |  |  | 0.0  |       |  |   | 1     |       |  |  | 0.0  |      
|                  
|                  
|                  
|                  
|Peru               |       |   | 368                               |       |   |  | 7.0  |       |   |   | 427   |       |   |  | 8.3  |       |   |   | 199   |       |   |  | 4.3  |       |  |   | 192   |       |  |  | 3.9  |       |  |   | 120   |       |  |  | 2.5  |      
|                  
|                  
|                  
|                  
|Trinidad & Tobago  |       |   | 26                                |       |   |  | 0.5  |       |   |   | 33    |       |   |  | 0.6  |       |   |   | 26    |       |   |  | 0.6  |       |  |   | 55    |       |  |  | 1.1  |       |  |   | 59    |       |  |  | 1.2  |      
|                  
|                  
|                  
|                  
|Uruguay            |       |   | 40                                |       |   |  | 0.8  |       |   |   | 73    |       |   |  | 1.4  |       |   |   | 23    |       |   |  | 0.5  |       |  |   | 7     |       |  |  | 0.2  |       |  |   | 0     |       |  |  | 0.0  |      
|                  
|                  
|                  
|                  
|Venezuela          |       |   | 20                                |       |   |  | 0.4  |       |   |   | 52    |       |   |  | 1.0  |       |   |   | 25    |       |   |  | 0.5  |       |  |   | 40    |       |  |  | 0.8  |       |  |   | 242   |       |  |  | 5.1  |      
|                  
|                  
|                  
|                  
|Other              |       |   | 11                                |       |   |  | 0.2  |       |   |   | 26    |       |   |  | 0.5  |       |   |   | 0     |       |   |  | 0.0  |       |  |   | 0     |       |  |  | 0.0  |       |  |   | 0     |       |  |  | 0.0  |      
|                   |       |   |                                   |       |   |  |      |       |   |   |       |       |   |  |      |       |   |   |       |       |   |  |      |       |  |   |       |       |  |  |      |       |  |   |       |       |  |  |      |      
|                   | Total |   | $                                 | 5,285 |   |  |      | 100.0 |   |   | $     | 5,120 |   |  |      | 100.0 |   |   | $     | 4,594 |   |  |      | 100.0 |  |   | $     | 4,927 |  |  |      | 100.0 |  |   | $     | 4,734 |  |  |      | 100.0 | 
|                   |       |   |                                   |       |   |  |      |       |   |   |       |       |   |  |      |       |   |   |       |       |   |  |      |       |  |   |       |       |  |  |      |       |  |   |       |       |  |  |      |      

The above table does not include the Banks outstanding selected
investment securities net of impairment loss (which were purchased as part of
its credit portfolio activity), securities purchased under agreements to
resell, letter of credit confirmations, customer liabilities under bankers
acceptances and guarantees, each issued to, or issued by, borrowers in the
Region, which totaled $1,663 million at December 31, 2001, and were distributed
as of December 31, 2001 as follows: Argentina: $310 million; Brazil: $449
million; Chile: $1 million; Colombia: $56 million; Costa Rica: $2 million;
the Dominican Republic: $46 million; Ecuador: $81 million; El Salvador: $42
million; Guatemala: $6 million; Jamaica: $12 million; Mexico: $229 million;
Nicaragua: $6 million; Panama: $38 million; Peru: $51 million; Venezuela:
$31 million; and Other: $303 million.

At December 31, 2001, the outstanding balance of medium and long-term
loans (long-term loans being defined as having a term to maturity greater than
five years) was $2,148 million, which was distributed as follows: Argentina:
$480 million; Bolivia: $1 million; Brazil: $945 million; Chile: $18 million;
Colombia: $88 million; Costa Rica: $8 million; the Dominican Republic: $70
million; Mexico: $312 million; Nicaragua: $2 million; Panama: $20 million;
Peru: $47 million; and Venezuela: $157 million.

At December 31, 2001, approximately 86% of the aggregate outstanding
principal amount of the Banks loans was made to borrowers in five countries:
Brazil (approximately 43%), Mexico (approximately 18%), Argentina
(approximately 17%), Venezuela (approximately 5%), and the Dominican Republic
(approximately 4%). In addition, at December 31, 2001, 24% of the Banks total
loans were to seven borrowers in Brazil and 15% of the Banks total loans were
to seven borrowers in Mexico.

17



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##### Table of Contents



Loans by Type of Borrower

The following table sets forth the amounts of the Banks loans by type of
borrower in the Region at December 31 of each year set forth below:

|                                    |       |   |                 |       |      |   |       |       |      |   |       |       |  |   |       |       |  |   |       |       | 
|----------------------------------- | ----- | - | --------------- | ----- | ---- | - | ----- | ----- | ---- | - | ----- | ----- |  | - | ----- | ----- |  | - | ----- | ----- | 
|                                    |       |   | At December 31,
|                                    |       |   |                
|                                    |       |   | 1997            |       | 1998 |   | 1999  |       | 2000 |   | 2001 
|                                    |       |   |                 |       |      |   |       |       |      |   |      
|                                    |       |   | (in millions)  
|                                    |       |   |                 |       |      |   |       |       |      |   |       |       |  |   |       |       |  |   |       |      
|                                   
|                                   
|                                   
|                                   
|Private sector commercial banks     |       | $ | 3,360           |       |      | $ | 2,967 |       |      | $ | 2,604 |       |  | $ | 2,503 |       |  | $ | 2,337 |      
|                                   
|                                   
|                                   
|                                   
|State-owned commercial banks        |       |   | 470             |       |      |   | 806   |       |      |   | 833   |       |  |   | 850   |       |  |   | 693   |      
|                                   
|                                   
|                                   
|                                   
|Central banks                       |       |   | 344             |       |      |   | 445   |       |      |   | 328   |       |  |   | 249   |       |  |   | 216   |      
|                                   
|                                   
|                                   
|                                   
|State-owned exporting organizations |       |   | 417             |       |      |   | 360   |       |      |   | 379   |       |  |   | 378   |       |  |   | 424   |      
|                                   
|                                   
|                                   
|                                   
|Private corporations                |       |   | 694             |       |      |   | 542   |       |      |   | 450   |       |  |   | 947   |       |  |   | 1,064 |      
|                                    |       |   |                 |       |      |   |       |       |      |   |       |       |  |   |       |       |  |   |       |      
|                                    | Total |   | $               | 5,285 |      |   | $     | 5,120 |      |   | $     | 4,594 |  |   | $     | 4,927 |  |   | $     | 4,734 | 
|                                    |       |   |                 |       |      |   |       |       |      |   |       |       |  |   |       |       |  |   |       |      

Securities Purchased under Agreements to Resell

The Bank purchases securities under agreements to resell the same or
substantially identical securities. These agreements are considered secured
loans. The purchased securities generally consist of U.S. Treasury and other
debt securities. At December 31, 2001, securities purchased under agreements
to resell with counterparties in Argentina had a carrying value of $291.9
million, all of which were fully secured with U.S Treasury securities and, in
accordance with market practice, had the additional coverage of a margin call
in cash. At December 31, 2001, the term to maturity of these agreements did
not exceed 30 days and the interest payments were current. The outstanding
balance of these instruments at June 21, 2002 was $152.3 million.

Investments

The Banks investments primarily consist of securities held to maturity
and securities available for sale. The Banks treasury investment policy
contemplates the purchase of investment grade securities (carrying two of the
following ratings: A-1, P-1 or F-1 from Standard & Poors, Moodys or Fitch,
respectively) having maturities of up to three years.

The Bank has classified under investments certain securities which do not
adhere to the Banks treasury investment policy, such as bonds and floating
rate notes that were bought as part of its credit portfolio lending policy and
which are subject to the same credit approval criteria as the rest of the
credit portfolio. At December 31, 2001, these securities represented 98% of
total investments. The Bank has classified as securities available for sale
certain debt instruments, such as negotiable commercial paper, certificates of
deposit, bonds and floating rate notes. The Bank buys these securities with
the intention of selling them in the future.

The following table sets forth information regarding the carrying value of
the Banks investment portfolio at December 31 of each year set forth below:

|                            |                              |                                   |   |                 |         |      |   |         |         |  |   |         |         | 
|--------------------------- | ---------------------------- | --------------------------------- | - | --------------- | ------- | ---- | - | ------- | ------- |  | - | ------- | ------- | 
|                            |                              |                                   |   | At December 31,
|                            |                              |                                   |   |                
|                            |                              |                                   |   | 1999            |         | 2000 |   | 2001   
|                            |                              |                                   |   |                 |         |      |   |        
|                            |                              |                                   |   | (in thousands) 
|                            |                              |                                   |   |                 |         |      |   |         |         |  |   |        
|                           
|                           
|                           
|                           
|Securities Held to Maturity |                              |                                   |   |                 |         |      |   |         |         |  |   |        
|                           
|                           
|                           
|                           
|                            | Bonds                        |                                   | $ | 102,672         |         |      | $ | 234,271 |         |  | $ | 175,833 |        
|                           
|                           
|                           
|                           
|                            | Floating rate notes          |                                   |   | 57,328          |         |      |   | 37,074  |         |  |   | 104,935 |        
|                           
|                           
|                           
|                           
|                            | Commercial paper             |                                   |   | 14,816          |         |      |   | 46,672  |         |  |   |        |        
|                           
|                           
|                           
|                           
|                            | Certificates of deposits     |                                   |   | 4,000           |         |      |   | 36,215  |         |  |   | 19,331  |        
|                           
|                           
|                           
|                           
|                            | Treasury bills               |                                   |   |                |         |      |   | 19,514  |         |  |   | 29,713  |        
|                           
|                           
|                           
|                           
|                            | Euro medium-term notes       |                                   |   |                |         |      |   | 11,713  |         |  |   |        |        
|                           
|                           
|                           
|                           
|                            | Impaired floating rate notes |                                   |   |                |         |      |   |        |         |  |   | 8,089   |        
|                            |                              |                                   |   |                 |         |      |   |         |         |  |   |         |        
|                            |                              | Total Securities Held to Maturity |   | $               | 178,816 |      |   | $       | 385,459 |  |   | $       | 337,901 | 
|                            |                              |                                   |   |                 |         |      |   |         |         |  |   |         |        

18



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|                              |                         |                                     |  |                 |         |      |   |        |         |  |   |        |         | 
|----------------------------- | ----------------------- | ----------------------------------- |  | --------------- | ------- | ---- | - | ------ | ------- |  | - | ------ | ------- | 
|                              |                         |                                     |  | At December 31,
|                              |                         |                                     |  |                
|                              |                         |                                     |  | 1999            |         | 2000 |   | 2001  
|                              |                         |                                     |  |                 |         |      |   |       
|                              |                         |                                     |  | (in thousands) 
|Securities Available for Sale |                         |                                     |  |                 |         |      |   |        |         |  |   |       
|                             
|                             
|                             
|                             
|                              | Bonds                   |                                     |  |                |         |      | $ | 10,000 |         |  | $ | 21,433 |        
|                             
|                             
|                             
|                             
|                              | Certificate of deposits |                                     |  |                |         |      |   |       |         |  |   | 764    |        
|                             
|                             
|                             
|                             
|                              | Impaired bonds          |                                     |  |                |         |      |   |       |         |  |   | 2,000  |        
|                              |                         |                                     |  |                 |         |      |   |        |         |  |   |        |        
|                              |                         | Total Securities Available for Sale |  | $               | 0       |      |   | $      | 10,000  |  |   | $      | 24,197  | 
|                              |                         |                                     |  |                 |         |      |   |        |         |  |   |        |        
|                              |                         | Total Investment Securities         |  | $               | 178,816 |      |   | $      | 395,459 |  |   | $      | 362,098 | 
|                              |                         |                                     |  |                 |         |      |   |        |         |  |   |        |        

At December 31, 2001, the total carrying value of investment securities is
net of an impairment loss of $40.4 million, which was charged to operations,
resulting primarily from the impairment of Argentine securities that were
purchased under the Banks credit portfolio lending policy. See  Asset
Quality and  Impaired Assets.

At December 31, 1999 and 2000, the Banks New York Agency had pledged
certificates of deposit with the State of New York Banking Department, as
required by law, with a carrying value of $4.0 million and $3.5 million,
respectively. At December 31, 2001 the pledged certificates of deposit had an
outstanding balance of $6.0 million. At December 31, 2001, the Banks
investment portfolio had a weighted average maturity of approximately one year
and one month and a weighted average interest rate of 6.95% per annum.

Total Outstandings by Country

The following table sets forth the aggregate amount of the Banks
cross-border outstandings, including cash and due from banks, interest-bearing
deposits in other banks, investment securities net of impairment loss and loans
(collectively Cross-Border Outstandings) at December 31 of each year set
forth below:

|                   |  |   |                                   |  |              |  |            |  |              |   |        |  |              |  |      |  |  |   |            |  |  |  |      |  | 
|------------------ |  | - | --------------------------------- |  | ------------ |  | ---------- |  | ------------ | - | ------ |  | ------------ |  | ---- |  |  | - | ---------- |  |  |  | ---- |  | 
|                   |  |   | At December 31,                  
|                   |  |   |                                  
|                   |  |   | 1999                              |  | 2000         |  | 2001      
|                   |  |   |                                   |  |              |  |           
|                   |  |   |                                   |  |              |  | % of Total |  |              |   |        |  | % of Total   |  |      |  |  |   | % of Total
|                   |  |   | Amount                            |  | Outstandings |  | Amount     |  | Outstandings |   | Amount |  | Outstandings
|                   |  |   |                                   |  |              |  |            |  |              |   |        |  |             
|                   |  |   | (in millions, except percentages)
|                   |  |   |                                   |  |              |  |            |  |              |   |        |  |              |  |      |  |  |   |            |  |  |  |      | 
|                  
|                  
|                  
|                  
|Argentina          |  | $ | 1,012                             |  |              |  | 19.6       |  |              | $ | 1,225  |  |              |  | 21.7 |  |  | $ | 884        |  |  |  | 14.9 | 
|                  
|                  
|                  
|                  
|Austria            |  |   | 5                                 |  |              |  | 0.0        |  |              |   | 0      |  |              |  | 0.0  |  |  |   | 55         |  |  |  | 0.9  | 
|                  
|                  
|                  
|                  
|Bahrain            |  |   | 0                                 |  |              |  | 0.0        |  |              |   | 0      |  |              |  | 0.0  |  |  |   | 15         |  |  |  | 0.3  | 
|                  
|                  
|                  
|                  
|Belgium            |  |   | 40                                |  |              |  | 0.8        |  |              |   | 20     |  |              |  | 0.4  |  |  |   | 15         |  |  |  | 0.3  | 
|                  
|                  
|                  
|                  
|Bolivia            |  |   | 62                                |  |              |  | 1.2        |  |              |   | 20     |  |              |  | 0.4  |  |  |   | 26         |  |  |  | 0.4  | 
|                  
|                  
|                  
|                  
|Brasil             |  |   | 1,654                             |  |              |  | 32.1       |  |              |   | 1,981  |  |              |  | 35.1 |  |  |   | 2,096      |  |  |  | 35.3 | 
|                  
|                  
|                  
|                  
|Canada             |  |   | 27                                |  |              |  | 0.5        |  |              |   | 0      |  |              |  | 0.0  |  |  |   | 0          |  |  |  | 0.0  | 
|                  
|                  
|                  
|                  
|Chile              |  |   | 81                                |  |              |  | 1.6        |  |              |   | 88     |  |              |  | 1.6  |  |  |   | 112        |  |  |  | 1.9  | 
|                  
|                  
|                  
|                  
|Colombia           |  |   | 207                               |  |              |  | 4.0        |  |              |   | 142    |  |              |  | 2.5  |  |  |   | 163        |  |  |  | 2.7  | 
|                  
|                  
|                  
|                  
|Costa Rica         |  |   | 23                                |  |              |  | 0.4        |  |              |   | 24     |  |              |  | 0.4  |  |  |   | 67         |  |  |  | 1.1  | 
|                  
|                  
|                  
|                  
|Denmark            |  |   | 75                                |  |              |  | 1.5        |  |              |   | 10     |  |              |  | 0.2  |  |  |   | 15         |  |  |  | 0.3  | 
|                  
|                  
|                  
|                  
|Dominican Republic |  |   | 57                                |  |              |  | 1.1        |  |              |   | 103    |  |              |  | 1.8  |  |  |   | 176        |  |  |  | 3.0  | 
|                  
|                  
|                  
|                  
|Ecuador            |  |   | 54                                |  |              |  | 1.0        |  |              |   | 67     |  |              |  | 1.2  |  |  |   | 14         |  |  |  | 0.2  | 
|                  
|                  
|                  
|                  
|El Salvador        |  |   | 24                                |  |              |  | 0.5        |  |              |   | 40     |  |              |  | 0.7  |  |  |   | 34         |  |  |  | 0.6  | 
|                  
|                  
|                  
|                  
|Finland            |  |   | 0                                 |  |              |  | 0.0        |  |              |   | 0      |  |              |  | 0.0  |  |  |   | 25         |  |  |  | 0.4  | 
|                  
|                  
|                  
|                  
|France             |  |   | 55                                |  |              |  | 1.1        |  |              |   | 36     |  |              |  | 0.6  |  |  |   | 40         |  |  |  | 0.7  | 
|                  
|                  
|                  
|                  
|Germany            |  |   | 0                                 |  |              |  | 0.0        |  |              |   | 80     |  |              |  | 1.4  |  |  |   | 120        |  |  |  | 2.0  | 
|                  
|                  
|                  
|                  
|Guatemala          |  |   | 19                                |  |              |  | 0.4        |  |              |   | 38     |  |              |  | 0.7  |  |  |   | 28         |  |  |  | 0.5  | 
|                  
|                  
|                  
|                  
|Ireland            |  |   | 0                                 |  |              |  | 0.0        |  |              |   | 0      |  |              |  | 0.0  |  |  |   | 20         |  |  |  | 0.3  | 
|                  
|                  
|                  
|                  
|Italy              |  |   | 20                                |  |              |  | 0.4        |  |              |   | 10     |  |              |  | 0.2  |  |  |   | 35         |  |  |  | 0.6  | 
|                  
|                  
|                  
|                  
|Japan              |  |   | 0                                 |  |              |  | 0.0        |  |              |   | 20     |  |              |  | 0.4  |  |  |   | 30         |  |  |  | 0.5  | 
|                  
|                  
|                  
|                  
|Mexico             |  |   | 1,123                             |  |              |  | 21.8       |  |              |   | 1,142  |  |              |  | 20.3 |  |  |   | 934        |  |  |  | 15.7 | 

19



---



##### Table of Contents



|                  |       |  |                                   |       |              |  |            |       |              |  |        |       |              |  |     |       |  |  |            |       |  |  |     |       | 
|----------------- | ----- |  | --------------------------------- | ----- | ------------ |  | ---------- | ----- | ------------ |  | ------ | ----- | ------------ |  | --- | ----- |  |  | ---------- | ----- |  |  | --- | ----- | 
|                  |       |  | At December 31,                  
|                  |       |  |                                  
|                  |       |  | 1999                              |       | 2000         |  | 2001      
|                  |       |  |                                   |       |              |  |           
|                  |       |  |                                   |       |              |  | % of Total |       |              |  |        |       | % of Total   |  |     |       |  |  | % of Total
|                  |       |  | Amount                            |       | Outstandings |  | Amount     |       | Outstandings |  | Amount |       | Outstandings
|                  |       |  |                                   |       |              |  |            |       |              |  |        |       |             
|                  |       |  | (in millions, except percentages)
|                 
|                 
|                 
|                 
|                  |       |  |                                   |       |              |  |            |       |              |  |        |       |              |  |     |       |  |  |            |       |  |  |     |      
|                 
|                 
|                 
|                 
|Nicaragua         |       |  | 33                                |       |              |  | 0.6        |       |              |  | 25     |       |              |  | 0.4 |       |  |  | 38         |       |  |  | 0.6 |      
|                 
|                 
|                 
|                 
|Panama            |       |  | 120                               |       |              |  | 2.3        |       |              |  | 123    |       |              |  | 2.2 |       |  |  | 58         |       |  |  | 1.0 |      
|                 
|                 
|                 
|                 
|Peru              |       |  | 199                               |       |              |  | 3.9        |       |              |  | 192    |       |              |  | 3.4 |       |  |  | 120        |       |  |  | 2.0 |      
|                 
|                 
|                 
|                 
|Portugal          |       |  | 15                                |       |              |  | 0.3        |       |              |  | 25     |       |              |  | 0.4 |       |  |  | 40         |       |  |  | 0.7 |      
|                 
|                 
|                 
|                 
|Spain             |       |  | 40                                |       |              |  | 0.8        |       |              |  | 10     |       |              |  | 0.2 |       |  |  | 0          |       |  |  | 0.0 |      
|                 
|                 
|                 
|                 
|Sweden            |       |  | 20                                |       |              |  | 0.4        |       |              |  | 28     |       |              |  | 0.5 |       |  |  | 30         |       |  |  | 0.5 |      
|                 
|                 
|                 
|                 
|The Netherlands   |       |  | 8                                 |       |              |  | 0.2        |       |              |  | 0      |       |              |  | 0.0 |       |  |  | 30         |       |  |  | 0.5 |      
|                 
|                 
|                 
|                 
|Trinidad y Tobago |       |  | 26                                |       |              |  | 0.5        |       |              |  | 55     |       |              |  | 1.0 |       |  |  | 59         |       |  |  | 1.0 |      
|                 
|                 
|                 
|                 
|United Kingdom    |       |  | 40                                |       |              |  | 0.8        |       |              |  | 20     |       |              |  | 0.4 |       |  |  | 32         |       |  |  | 0.5 |      
|                 
|                 
|                 
|                 
|United States     |       |  | 61                                |       |              |  | 1.2        |       |              |  | 34     |       |              |  | 0.6 |       |  |  | 338        |       |  |  | 5.7 |      
|                 
|                 
|                 
|                 
|Uruguay           |       |  | 23                                |       |              |  | 0.5        |       |              |  | 7      |       |              |  | 0.1 |       |  |  | 0          |       |  |  | 0.0 |      
|                 
|                 
|                 
|                 
|Venezuela         |       |  | 27                                |       |              |  | 0.5        |       |              |  | 43     |       |              |  | 0.8 |       |  |  | 273        |       |  |  | 4.6 |      
|                 
|                 
|                 
|                 
|Other (1)         |       |  | 10                                |       |              |  | 0.3        |       |              |  | 28     |       |              |  | 0.4 |       |  |  | 18         |       |  |  | 0.3 |      
|                  |       |  |                                   |       |              |  |            |       |              |  |        |       |              |  |     |       |  |  |            |       |  |  |     |      
|                  | Total |  | $                                 | 5,160 |              |  |            | 100.0 |              |  | $      | 5,636 |              |  |     | 100.0 |  |  | $          | 5,940 |  |  |     | 100.0 | 
|                  |       |  |                                   |       |              |  |            |       |              |  |        |       |              |  |     |       |  |  |            |       |  |  |     |      



---

|(1) |  | Other consists of Cross-Border Outstandings to countries in which
Cross-Border Outstandings did not exceed $10 million for any of the
periods indicated above.
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------

The following table sets forth the amount of the Banks Cross-Border
Outstandings by type of institution at December 31 for each of the years set
forth below:

|                                    |       |   |                 |       |      |   |       |       |  |   |       |       | 
|----------------------------------- | ----- | - | --------------- | ----- | ---- | - | ----- | ----- |  | - | ----- | ----- | 
|                                    |       |   | At December 31,
|                                    |       |   |                
|                                    |       |   | 1999            |       | 2000 |   | 2001 
|                                    |       |   |                 |       |      |   |      
|                                    |       |   | (in millions)  
|                                    |       |   |                 |       |      |   |       |       |  |   |       |      
|                                   
|                                   
|                                   
|                                   
|Private sector commercial banks     |       | $ | 2,984           |       |      | $ | 2,914 |       |  | $ | 2,880 |      
|                                   
|                                   
|                                   
|                                   
|State-owned commercial banks        |       |   | 901             |       |      |   | 910   |       |  |   | 1,092 |      
|                                   
|                                   
|                                   
|                                   
|Central banks                       |       |   | 427             |       |      |   | 354   |       |  |   | 286   |      
|                                   
|                                   
|                                   
|                                   
|State-owned exporting organizations |       |   | 393             |       |      |   | 395   |       |  |   | 473   |      
|                                   
|                                   
|                                   
|                                   
|Private corporations                |       |   | 455             |       |      |   | 1,063 |       |  |   | 1,210 |      
|                                    |       |   |                 |       |      |   |       |       |  |   |       |      
|                                    | Total |   | $               | 5,161 |      |   | $     | 5,636 |  |   | $     | 5,940 | 
|                                    |       |   |                 |       |      |   |       |       |  |   |       |      

Letters of Credit, Guarantees and Customer Liabilities under Acceptances

Letters of credit, guarantees and customer liabilities under acceptances
are considered part of the credit portfolio because the Bank applies the same
credit standards used in its lending process in its evaluation of these
instruments. At December 31, 2001, total letters of credit, guarantees and
customer liabilities under acceptances amounted to $911 million, which
represented 14% of the Banks total credit portfolio.

The Bank advises and confirms letters of credit to facilitate internal and
external regional trade transactions. The Bank also issues stand-by letters of
credit and guarantees to provide coverage for country risk arising from the
risk of convertibility and transferability of local currency of countries in
the Region into hard currency. However, in a few cases, the Bank also issues
stand-by letters of credit and guarantees to provide coverage for country risk
arising from political risks, such as expropriation, nationalization, war
and/or civil disturbances. At December 31, 2001, total stand-by letters of
credit and guarantees representing country risk coverage amounted to $223
million, of which $31 million represented Argentine country risk exposure.

20



---



##### Table of Contents



Asset Quality

Since the commencement of the Banks operations in 1979 through December
31, 2001, the Bank has had charge-offs totaling $77 million. Impaired assets
constituted 0.45%, 0.28% and 1.4% of the total credit portfolio of the Bank at
December 31, 1999, 2000 and 2001, respectively. At May 31, 2002, impaired
assets comprised 3.1% of the total credit portfolio, almost all of which
constituted Argentine exposure.

Although the Bank is exposed to the types of problems that are currently
affecting Argentina, the Bank attributes its asset quality to the trade-related
nature of its loan portfolio (loans plus selected investments); the composition
of its client base, which consists primarily of commercial banks, central
banks, state-owned institutions and top tier private corporations; the
importance that governments and borrowers in the Region attach to maintaining
their continuing access to trade financing; and the Banks strict adherence to
commercial criteria in its credit activities. The Bank has developed an
in-depth knowledge of and relationship with its client base throughout its 23
years of operations in the Region, which allows it to continue to further
enhance its risk management process.

The management of the Bank reviews a report of all loan delinquencies on a
daily basis. The Banks collection policies include rapid internal
notification of any delinquency and prompt initiation of collection efforts,
usually with the involvement of senior management.

Impaired Assets

Loans are identified as impaired and placed on non-accrual status when any
payment of principal or interest is over 90 days past due or earlier if the
Banks management determines that the ultimate collection of principal or
interest is doubtful. In all cases, if a borrower has more than one loan
outstanding under its line of credit with the Bank and any of its individual
loans is placed on non-accrual status, the Bank places all outstanding loans to
that borrower on non-accrual status. In the same manner, if a single note of a
loan is placed on non-accrual status, the remaining notes under that loan are
placed on non-accrual status as well. Securities that experience a decline in
value, which is deemed other than temporary, are classified as impaired.

The following table sets forth information regarding the Banks impaired
assets at the dates indicated below.

|                                                       |  |                                    |   |      |  |      |   |      |  |      |        |   |  |   |        |   |  |   |        |  
|------------------------------------------------------ |  | ---------------------------------- | - | ---- |  | ---- | - | ---- |  | ---- | ------ | - |  | - | ------ | - |  | - | ------ | -
|                                                       |  | At December 31,                   
|                                                       |  |                                   
|                                                       |  | 1997                               |   | 1998 |  | 1999 |   | 2000 |  | 2001
|                                                       |  |                                    |   |      |  |      |   |      |  |     
|                                                       |  | (in thousands, except percentages)
|                                                       |  |                                    |   |      |  |      |   |      |  |      |        |   |  |   |        |   |  |   |        |  
|                                                      
|                                                      
|                                                      
|                                                      
|Impaired loans                                         |  |                                    |  |      |  |      |  |      |  | $    | 23,786 |   |  | $ | 14,724 |   |  | $ | 77,061 |  
|                                                      
|                                                      
|                                                      
|                                                      
|Allocation from the allowance for loan
losses:         |  |                                    |   |      |  |      |   |      |  |      | 23,786 |   |  |   | 9,326  |   |  |   | 22,895 |  
|                                                      
|                                                      
|                                                      
|                                                      
|Impaired loans as a percentage of
total loan portfolio |  |                                    |  |      |  |      |  |      |  |      | 0.53   | % |  |   | 0.30   | % |  |   | 1.69   | %
|                                                      
|                                                      
|                                                      
|                                                      
|Impaired securities                                    |  |                                    |  |      |  |      |  |      |  |      | 15,000 |   |  |   | 9,750  |   |  |   | 50,444 |  
|                                                      
|                                                      
|                                                      
|                                                      
|Impairment loss on securities                          |  |                                    |  |      |  |      |  |      |  |      | 11,325 |   |  |   | 6,075  |   |  |   | 40,356 |  
|                                                       |  |                                    |   |      |  |      |   |      |  |      |        |   |  |   |        |   |  |   |        |  
|Estimated fair value of impaired securities            |  |                                    |  |      |  |      |  |      |  | $    | 3,675  |   |  | $ | 3,675  |   |  | $ | 10,089 |  
|                                                      
|                                                      
|                                                      
|                                                      
|Impaired assets as a percentage of
total assets        |  |                                    |  |      |  |      |  |      |  |      | 0.53   | % |  |   | 0.33   | % |  |   | 1.47   | %

Impaired loans

Total impaired loans were $77.1 million at December 31, 2001 compared to
$14.7 and $23.8 million at December 31, 2000 and 1999, respectively.

21



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##### Table of Contents



On April 1, 1999, the Bank identified several impaired loans totaling $13
million to a Mexican corporation that had experienced liquidity problems. On
June 1, 1999, the Bank identified several impaired loans totaling $11 million
to an Argentine bank. During the second quarter of 1999, the Bank received a
payment of $1.6 million relating to an impaired loan. During the third quarter
of 1999, the Bank identified impaired loans for $6.3 million to a Canadian
company and then charged off its total exposure of $6.3 million to this
Canadian company during the fourth quarter of 1999. Also during the fourth
quarter of 1999, the Bank identified impaired loans totaling $2.0 million and
received a payment of $0.7 million relating to an impaired loan, bringing the
balance of impaired loans to $23.8 million at December 31, 1999.

During the first quarter of 2000, the Bank received a payment of $1.9
million relating to an impaired loan. During the second quarter of 2000, the
Bank identified impaired loans totaling $4.3 million to an Ecuadorian bank and
$4.1 million to an Argentine corporation. Also during this period, the Bank
received a payment of $0.3 million relating to an impaired loan. During the
third quarter of 2000, the Bank identified impaired loans totaling $1.6 million
to a Nicaraguan bank. During the fourth quarter of 2000 the Bank identified
impaired loans totaling $4.4 million to a Peruvian bank and then charged-off
its total exposure of $11.4 million and $4.1 million to a Mexican corporation
and an Argentine corporation, respectively, previously classified as impaired.
Also during the fourth quarter of 2000 the Bank received payments of $1.7
million relating to impaired loans, bringing the balance of impaired loans to
$14.7 million at December 31, 2000.

During 2001, the Bank charged-off an impaired loan of $10.3 million to an
Argentine bank and an additional $ 0.1 million was recovered on a bank loan
charged-off in 1998. At December 31, 2001, loans to an Argentine bank, a
Mexican corporation and an Argentine corporation were identified as impaired,
making a total of $77.1 million.

The Bank had no other material non-accruing loans and no other material
troubled debt restructuring at any of the dates indicated in the above table,
except for loans totaling $7.8 million to an Ecuadorian financial institution,
$1.5 million to a Mexican corporation, and $33.8 million to four institutions
in Argentina, all of which are classified as criticized loans. Management does
not believe that there is a material amount of loans not included in this
Annual Report with respect to which it has serious doubts as to the ability of
the borrowers to comply with the present loan repayment terms and which may
result in such loans becoming non-accruing loans, except for the Banks total
exposure in Argentina which, given current market conditions, the Bank expects
will have to be renegotiated and restructured. See Key Information  Risk
Factors  Regional Economic Conditions.

Impaired Securities

During the third quarter of 1997, the Bank entered into a series of put
option contracts providing for guarantees to a counterparty with respect to
certain assets with an aggregate face value of $221.4 million. At certain
specified exercise dates, or if an event of default occurs, the counterparty
has the right to sell an underlying asset to the Bank generally at par, if the
market yield on the underlying asset exceeds the strike yield under the
contract. The underlying assets consist of debt issued by several sovereign
borrowers in the Region. From 1998 through 2000, the counterparty exercised
put options in the amount of $96.4 million, under which the Bank purchased the
underlying assets (generally at par) and booked them as investments held to
maturity at their respective market values. At December 31, 1999, 2000 and
2001, the notional value of the remaining options was $150 million, $100
million and $100 million, respectively.

Of the options exercised in 1999, an underlying asset for $15 million
represented defaulted bonds. These defaulted bonds were booked at their market
value of $3.7 million, and the balance was charged-off against the Banks
allowance for guarantees. These defaulted bonds were sold in 2001. At
December 31, 2001, the Bank identified impaired securities of $50 million from
two Argentine banks and charged an impairment loss of $40.4 million to earnings
relating thereto. As of June 21, 2002, no losses have been charged to earnings
as a result of impaired securities in 2002.

22



---



##### Table of Contents



Allowance for Credit Losses

The allowance for credit losses covers the credit risk on loans and
contingencies. This allowance for credit losses is maintained at a level that
is adequate in managements judgment to provide for estimated probable credit
losses inherent in various on and off balance sheet financial instruments,
based upon the following factors: (i) the economic conditions in the countries
of the Region in which the Bank lends and the potential impact of these
economic conditions on foreign exchange availability and the trade related
economic sectors in these countries; (ii) the Regions volatility and
vulnerability to external factors; (iii) the nature and characteristics of the
Banks loan portfolio, which is primarily unsecured and contains some large
loans and significant country concentrations; and (iv) the size of the Banks
credit portfolio.

In estimating losses on impaired loans the Banks management considers a
number of variables including, as appropriate, the present value of expected
future cash flows discounted at the loans contractual effective rate, the
secondary market value of the loan and the fair value of the collateral.

In addition, the Bank maintains credit loss reserves for probable losses
on the entire credit portfolio of the Bank net of impaired credits. On a
quarterly basis, the Bank estimates probable credit losses using a provisioning
matrix model which differentiates risk into three categories: country risk,
borrower risk and transaction type risk, and aggregates the sum of these
factors. To determine the probability of loss due to country risk, the Bank
uses sovereign ratings of well-known independent rating agencies. For borrower
risk, the Bank uses the probability of default matrix of a well-known rating
agency. The Bank evaluates the transaction risk mainly by taking into account
whether the risk is a short-term trade transaction or otherwise. This model is
a tool to estimate and validate the levels of reserves required,since it does
not take into account all variables affecting asset quality. Therefore, the
Bank also reviews the adequacy of reserves, taking into account regional
political, financial and economic trends affecting the portfolio, delinquency
trends, volatility and significant concentrations that are not fully reflected
in the model, and then adjusts the level of required reserves accordingly as of
the end of each quarterly period.

During the fourth quarter of 1999, in accordance with current accounting
practices, the Bank changed the apportionment and presentation of the allowance
for credit losses by dividing such losses into three components:



| |                                                                                                  
| | -------------------------------------------------------------------------------------------------
| |                                                                                                  
| | (1) An allowance for loan losses (reported as a deduction from
loans);                           
| |                                                                                                  
| | (2) An allowance for losses on off-balance sheet credit risk (reported in other liabilities); and
| |                                                                                                  
| | (3) An allowance for losses on guarantees (reported in other
liabilities).                       

However, on January 1, 2001, as a result of the adoption of SFAS 133, the
allowance for losses on guarantees was eliminated. See Allowance for Losses
on Guarantees below.

The following table sets forth information regarding the Banks allowance
for possible credit losses with respect to total credits outstanding at the
dates indicated.

|                                                |                                  |  |                                    |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|----------------------------------------------- | -------------------------------- |  | ---------------------------------- | ------- | ---- |  | ---- | ------- | ---- |  | ---- | ------- | - |  | - | ------- | - |  | - | ------- | -
|                                                |                                  |  | At December 31,                   
|                                                |                                  |  |                                   
|                                                |                                  |  | 1997                               |         | 1998 |  | 1999 |         | 2000 |  | 2001
|                                                |                                  |  |                                    |         |      |  |      |         |      |  |     
|                                                |                                  |  | (in thousands, except percentages)
|                                                |                                  |  |                                    |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |        
|                                               
|                                               
|                                               
|                                               
|Components of the allowance for credit losses   |                                  |  |                                    |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |        
|                                               
|                                               
|                                               
|                                               
|Allowance for loan losses                       |                                  |  |                                    |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |        
|                                               
|                                               
|                                               
|                                               
|                                                | Balance at beginning of the year |  | $                                  | 100,836 |      |  | $    | 116,256 |      |  | $    | 108,753 |   |  | $ | 117,670 |   |  | $ | 110,388 |  
|                                               
|                                               
|                                               
|                                               
|                                                | Provision                        |  |                                    | 15,600  |      |  |      | 11,200  |      |  |      | 14,700  |   |  |   | 8,000   |   |  |   | 77,144  |  
|                                               
|                                               
|                                               
|                                               
|                                                | Recoveries                       |  |                                    |        |      |  |      | 428     |      |  |      | 531     |   |  |   | 307     |   |  |   | 286     |  
|                                               
|                                               
|                                               
|                                               
|                                                | Loans charged-off                |  |                                    | (180    | )    |  |      | (19,131 | )    |  |      | (6,314  | ) |  |   | (15,589 | ) |  |   | (10,334 | )
|                                                |                                  |  |                                    |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |         |  
|                                                | Balance at the end of the year   |  | $                                  | 116,256 |      |  | $    | 108,753 |      |  | $    | 117,670 |   |  | $ | 110,388 |   |  | $ | 177,484 |  
|                                               
|                                               
|                                               
|                                               
|Allowance for losses on off-balance sheet risk: |                                  |  |                                    |         |      |  |      |         |      |  |      |         |   |  |   |         |   |  |   |        

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|                                                                                   |                                           |  |                                    |       |      |  |      |        |      |  |      |         |   |  |     |        |   |  |     |        |  
|---------------------------------------------------------------------------------- | ----------------------------------------- |  | ---------------------------------- | ----- | ---- |  | ---- | ------ | ---- |  | ---- | ------- | - |  | --- | ------ | - |  | --- | ------ | -
|                                                                                   |                                           |  | At December 31,                   
|                                                                                   |                                           |  |                                   
|                                                                                   |                                           |  | 1997                               |       | 1998 |  | 1999 |        | 2000 |  | 2001
|                                                                                   |                                           |  |                                    |       |      |  |      |        |      |  |     
|                                                                                   |                                           |  | (in thousands, except percentages)
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                   | Balance at beginning of the year          |  |                                    |      |      |  |      |       |      |  | $    |        |   |  | $   | 6,000  |   |  | $   | 17,200 |  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                   | Provision                                 |  |                                    |      |      |  |      |       |      |  |      | 6,000   |   |  |     | 11,200 |   |  |     |       |  
|                                                                                   |                                           |  |                                    |       |      |  |      |        |      |  |      |         |   |  |     |        |   |  |     |        |  
|                                                                                   | Balance at end of the year                |  |                                    | 0     |      |  |      | 0      |      |  | $    | 6,000   |   |  | $   | 17,200 |   |  | $   | 17,200 |  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|Allowance for losses on guarantees (potential
credit and market losses on options) |                                           |  |                                    |       |      |  |      |        |      |  |      |         |   |  |     |        |   |  |     |       
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                   | Balance at beginning of the year          |  | $                                  |      |      |  | $    | 5,008  |      |  | $    | 18,416  |   |  | $   | 6,838  |   |  | $   | 5,025  |  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                   | Provision charged to expenses             |  |                                    | 5,008 |      |  |      | 15,534 |      |  |      |        |   |  |     |       |   |  |     |       |  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                   | Reclassification due to SFAS 133 adoption |  |                                    |      |      |  |      |       |      |  |      |        |   |  |     |       |   |  |     | (5,025 | )
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                   | Guarantees charged-off                    |  |                                    |      |      |  |      | (2,126 | )    |  |      | (11,578 | ) |  |     | (1,813 | ) |  |     |       |  
|                                                                                   |                                           |  |                                    |       |      |  |      |        |      |  |      |         |   |  |     |        |   |  |     |        |  
|                                                                                   | Balance at the end of the year            |  | $                                  | 5,008 |      |  | $    | 18,416 |      |  | $    | 6,838   |   |  | $   | 5,025  |   |  | $   | 0      |  
|                                                                                  
|                                                                                  
|                                                                                  
|                                                                                  
|Allowance for credit losses to total credit
portfolio                              |                                           |  | 1.7                                | %     |      |  | 1.6  | %      |      |  | 2.0  | %       |   |  | 2.0 | %      |   |  | 3.0 | %     

Management believes that the Banks reserve level should reflect the
potential for political and economic instability in countries in the Region and
economic cycles. The recent events in Argentina provide an example of the
potential for economic instability in the Region and the need to maintain
reserves at a conservative level. Given the Banks large exposure to borrowers
in a number of countries in the Region with the potential for economic and/or
political instability and their high dependency on external capital, the Bank
believes that its policy regarding the allowance for credit losses is
appropriate. See   Loans by Country. The determination of the appropriate
level of allowances for credit losses necessarily requires managements
judgment, including assumptions and estimates made in the context of rapidly
changing political and economic conditions in many of the countries in the
Region. Accordingly, there is no assurance that the Banks current level of
reserves will prove to be adequate in light of current and future events,
particularly in Argentina. As of December 31, 2001, the total allowance for
credit losses was $195 million, reflecting additional provisions taken in 2001
of $77.1 million, compared to $19.2 million in 2000. This allowance includes
$113.9 million corresponding to Argentina, of which $23.9 million represents
reserves for specific Argentine loans. The Banks Board of Directors has
determined to further increase the allowance for credit losses and impairment
losses on securities as of June 30, 2002 to approximately $510 million, of
which approximately $420 million will relate to its Argentine portfolio.

The Bank does not have a rigid charge-off policy, but instead charges-off
loans on a case-by-case basis as determined by management and as approved by
the Board of Directors. See Notes 6 and 7 of the Notes to the Consolidated
Financial Statements.

Allowance for Losses on Guarantees

During the third quarter of 1997, the Bank entered into a series of put
option contracts providing for guarantees to a counterparty with respect to
certain assets with an aggregate face value of $221.4 million. At certain
specified exercise dates, or in the event of default, the counterparty has the
right to sell an underlying asset to the Bank (generally at par), if the market
yield on the underlying asset exceeds the strike yield set forth in the
contract. The underlying assets consist of debt issued by several sovereign
borrowers in the Region.

During the fourth quarter of 1997, the Bank established a $5 million
allowance for potential credit and market value losses in connection with these
put option contracts. During 1998, the Bank charged-off $2.1 million for put
options exercised, which reflected the difference between the market price and
the par value of assets bought under these put option contracts. The Bank also
added $15.5 million to the allowance for losses on guarantees during 1998,
bringing the accumulated allowance for losses on guarantees to $18.4 million at
December 31, 1998. In 1999 and 2000, the Banks counterparty exercised options
in the amount of $45 million and $50 million, respectively, under which the
Bank purchased the underlying assets generally at par and booked them as
investments held to maturity at their respective market values. At December
31, 1999, 2000 and 2001,

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the notional value of the remaining options was $150, $100 and $100
million, respectively. At December 31, 2001, the underlying assets relating to
these options consisted of bonds issued by sovereign entities, of which 75%
were issued by Mexico and 25% by Colombia. As of December 31, 2001, the
average remaining exercise period of the options was approximately eight
months. At this time the Bank is unsure whether further losses on these option
contracts will be incurred as such losses would depend primarily on changes in
the market value of the underlying assets relating thereto.

The balance of the allowance for losses on guarantees at December 31, 2000
and 1999 was $5.0 million and $6.8 million, respectively. On January 1, 2001,
as a result of the adoption of SFAS 133, the allowance for losses on guarantees
was eliminated and the balance of $5.0 million was applied to cover the fair
market valuation of the remaining options at that date. See Note 7 (Allowance
for Credit Losses) of the Consolidated Financial Statements.

Revenues Per Country

The following table sets forth information regarding the Banks
approximate net revenues per country at the dates indicated below, with net
revenues calculated as the sum of net interest income, net commission income,
gains on sale of securities available for sale and other income.

|                   |       |   |                 |       |      |   |      |       |  |   |      |       | 
|------------------ | ----- | - | --------------- | ----- | ---- | - | ---- | ----- |  | - | ---- | ----- | 
|                   |       |   | At December 31,
|                   |       |   |                
|                   |       |   | 1999            |       | 2000 |   | 2001
|                   |       |   |                 |       |      |   |     
|                   |       |   | (in millions)  
|                   |       |   |                 |       |      |   |      |       |  |   |      |      
|                  
|                  
|                  
|                  
|Argentina          |       | $ | 21.5            |       |      | $ | 26.0 |       |  | $ | 32.8 |      
|                  
|                  
|                  
|                  
|Bolivia            |       |   | 1.4             |       |      |   | 1.1  |       |  |   | 0.6  |      
|                  
|                  
|                  
|                  
|Brasil             |       |   | 59.6            |       |      |   | 51.6 |       |  |   | 47.8 |      
|                  
|                  
|                  
|                  
|Chile              |       |   | 1.1             |       |      |   | 1.5  |       |  |   | 1.6  |      
|                  
|                  
|                  
|                  
|Colombia           |       |   | 3.1             |       |      |   | 3.2  |       |  |   | 3.6  |      
|                  
|                  
|                  
|                  
|Costa Rica         |       |   | 0.6             |       |      |   | 0.8  |       |  |   | 1.1  |      
|                  
|                  
|                  
|                  
|Dominican Republic |       |   | 2.7             |       |      |   | 3.8  |       |  |   | 5.3  |      
|                  
|                  
|                  
|                  
|Ecuador            |       |   | 3.4             |       |      |   | 3.2  |       |  |   | 3.3  |      
|                  
|                  
|                  
|                  
|El Salvador        |       |   | 0.7             |       |      |   | 2.0  |       |  |   | 1.2  |      
|                  
|                  
|                  
|                  
|Guatemala          |       |   | 0.4             |       |      |   | 0.9  |       |  |   | 1.3  |      
|                  
|                  
|                  
|                  
|Honduras           |       |   | 0.2             |       |      |   | 0.1  |       |  |   | 0.1  |      
|                  
|                  
|                  
|                  
|Jamaica            |       |   | 0.6             |       |      |   | 0.6  |       |  |   | 0.5  |      
|                  
|                  
|                  
|                  
|Mexico             |       |   | 24.7            |       |      |   | 28.4 |       |  |   | 22.3 |      
|                  
|                  
|                  
|                  
|Nicaragua          |       |   | 1.3             |       |      |   | 2.0  |       |  |   | 1.6  |      
|                  
|                  
|                  
|                  
|Panama             |       |   | 2.9             |       |      |   | 3.6  |       |  |   | 2.5  |      
|                  
|                  
|                  
|                  
|Paraguay           |       |   | 0.1             |       |      |   | 0.1  |       |  |   | 0.0  |      
|                  
|                  
|                  
|                  
|Peru               |       |   | 9.1             |       |      |   | 6.2  |       |  |   | 4.5  |      
|                  
|                  
|                  
|                  
|Trinidad & Tobago  |       |   | 0.8             |       |      |   | 1.0  |       |  |   | 1.5  |      
|                  
|                  
|                  
|                  
|Uruguay            |       |   | 0.9             |       |      |   | 0.2  |       |  |   | 0.1  |      
|                  
|                  
|                  
|                  
|Venezuela          |       |   | 1.3             |       |      |   | 0.8  |       |  |   | 3.2  |      
|                  
|                  
|                  
|                  
|Other              |       |   | 2.0             |       |      |   | 0.4  |       |  |   | 3.0  |      
|                   |       |   |                 |       |      |   |      |       |  |   |      |      
|                   | Total |   | $               | 138.4 |      |   | $    | 137.5 |  |   | $    | 137.9 | 
|                   |       |   |                 |       |      |   |      |       |  |   |      |      

Competition

The Bank operates in a highly competitive environment in most of its
markets. Management recognizes that the Bank needs to continue to invest and
adapt to remain competitive. The Bank faces strong competition in making
loans, in attracting deposits and in providing fee-generating services. The
Banks competition in making loans comes principally from regional and
international banks. Financial desintermediation by the securities market and
specialized finance companies is another factor that represents competition to
the Banks lending activity. Whenever economic conditions and risk perception
improve in the largest countries of the Region, the competition from commercial
banks, the securities markets and other new players increases accordingly.
This competition may have the effect of reducing the spreads of the Banks
lending rates over its cost of funds and

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constraining the Banks profitability in the future. The Bank competes in
its lending and deposit taking activities with other banks and international
financial institutions, many of which have greater financial resources and
offer sophisticated banking services.

The Bank believes that most of the competition it faces in the trade
financing area and within the markets served by the Bank is from over one
hundred international banks, mostly European and North American, which provide
similar financing services. Although these international banks compete with
the Bank, they are also providers of funding for the Bank and represent a
source of business for the Bank. The Bank participates in transactions
arranged by international banks, engages in co-financing with international and
local banks to lend to borrowers in the Region, and sells loans and risk
participations to international and local banks. Most of these international
banks provide credit facilities to the Bank to finance the Banks trade finance
activity. The Bank also lends to branches or subsidiaries of certain
international banks in the Region. At December 31, 2001, loans to
international banks represented approximately 19% of the Banks total loans.
Furthermore, the Bank provides country risk coverage to branches of certain
international banks that want to increase their activity in the Region, but
cannot increase cross-border risks.

The Bank believes that competition also comes from investment banks and
the securities markets, which provides liquidity to the financial systems in
certain countries in the Region as well as non-bank specialized financial
institutions. The Bank competes primarily on the basis of competitive pricing
in financing trade-related transactions. The Bank believes that it continues
to possess a competitive advantage in that it enables its customer banks to
meet their clients financing needs, but does not compete directly with these
banks for the business of their clients. Moreover, the Bank has developed
customer loyalty because it has been a consistent source of trade-related
financing. The Bank believes that it is an important source of trade finance
to many of its clients. The Bank also believes that its operating efficiencies
and business focus constitute important competitive advantages in certain
markets.

The trade financing business is also subject to changes. Increased open
account exports and new financing requirements from multinational corporations
are putting more pressure on the way banks traditionally intermediate foreign
trade financing. The Bank cannot predict with certainty the changes that may
occur and affect the competitiveness of its businesses. Although the Bank has
undertaken several initiatives to adapt to and benefit from these changes, it
is possible that competition with the Banks products will, in the future,
reduce demand for the Banks services. If this were to occur, the Bank may be
required to take steps to further adapt to the changing competitive
environment.

Consolidation in the banking systems of the markets in which the Bank
operates could potentially affect the competitive environment in these markets.
The consolidation process in most countries of the Region has reduced the
number of client banks that the Bank can work with. The acquisition of local
banks by large international banks in the local markets of the Region may also
change the competitive environment. The Bank cannot predict with certainty the
extent to which these changes in the banking industry may occur or the success
that they may achieve. Although the Bank currently has a strong position in
each of its market segments and is undertaking several initiatives to adapt,
these changes in the business and in the markets of this Region could
potentially place the Bank at a competitive disadvantage with respect to scale,
resources and its ability to develop and diversify its sources of income. See
Credit Portfolio and Lending Policies, Loan PortfolioInvestments and
Letters of Credit, Guarantees and Customer Liabilities under Acceptances.

Regulation

General

The Superintendence of Banks of Panama (the Superintendence of Banks)
regulates, supervises and examines BLADEX. In addition, BLADEX Cayman is
regulated, supervised and examined by government authorities in the Cayman
Islands, and the New York Agency is regulated, supervised and examined by the
New York Banking Department and the Federal Reserve Board. BLADEX Cayman and
the New York Agency held

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$371 million and $368 million in assets, respectively, at December 31, 2001.
The regulation of the Bank and BLADEX Cayman by relevant Panamanian and Cayman
Islands authorities differs from the regulation generally imposed on banks in
the United States by federal and state regulatory authorities.

Panamanian Law

On February 26, 1998, Panama adopted Decree-Law No. 9 (the Banking Law),
which is a comprehensive revision and restatement of the banking legislation in
Panama. The Banking Law took effect on June 12, 1998.

BLADEX operates in Panama under a General Banking License issued by the
National Banking Commission, predecessor of the Superintendence of Banks, and
is subject to supervision and examination by the Superintendence of Banks.
Banks operating under a General Banking License (General License Banks) are
entitled to engage in all aspects of the business of banking in Panama,
including accepting local and offshore deposits as well as entering into
banking transactions in Panama that may have an economic impact outside of
Panama.

General License Banks must have a paid-in capital of not less than $10
million. Additionally, General License Banks must maintain minimum capital of
8% of their total risk-weighted assets. Capital is defined to include primary
capital and secondary capital. Primary capital (Tier 1 capital) is comprised
of paid-in capital, declared reserves and retained earnings while secondary
capital (Tier 2 capital) includes undeclared reserves, reevaluations reserves,
general reserves for losses, certain hybrid debt capital instruments and
certain subordinated indebtedness. Secondary capital may not exceed primary
capital. The Superintendence of Banks is authorized to increase the minimum
capital requirement percentage in Panama in the event that generally accepted
international capitalization standards as set forth in the Basle Accord become
more stringent, in order to comply with such new international standards.

General License Banks are required to maintain 30% of their global
deposits in liquid assets (which include short-term loans to other banks and
other liquid assets) of the type prescribed by the Superintendence of Banks.
In addition, General License Banks are required to maintain local assets in
Panama in an amount not less than 85% of the deposits received from entities in
Panama.

Regulations regarding interest rate ceilings provided for in the prior
banking law have been abolished by the Banking Law. Currently, banks in Panama
can freely fix the amount of interest to be charged on their loans and with
respect to operations. Banks in Panama are required to indicate the effective
interest rates of loans and deposits in their statements to clients or at a
clients request. Under the Banking Law, deposits from central banks and other
similar financial institutions are immune from any attachment or seizure
proceedings.

Pursuant to the Banking Law, no bank in Panama may make loans or issue
guarantees or any other obligations, to any one person or a group of related
persons in excess of 25% of the Banks total capital; provided that, for
Panamanian banks (i) whose shares are owned by governmental institutions and
private institutions, (ii) whose principal office is located in Panama, and
(iii) whose main line of business is lending to other banks (Exempted Banks),
the foregoing lending limit is 30%. BLADEX is an Exempted Bank. Although
the Banks anticipated increase in the allowance for credit losses and
impairment losses on securities will cause the Bank to exceed this 30%
limitation in certain instances, based upon discussions with the
Superintendence of Banks, the Banks management expects to receive a waiver of
this requirement with respect to existing credits.

Under the Banking Law, a bank may not make loans or issue guarantees or
any other obligations that are in (i) excess of 5% of its total capital, in the
case of unsecured transactions, (ii) excess of 10% of its total capital, in the
case of collateralized transactions (other than loans secured by deposits in
the bank), and (iii) excess of 50% of its total capital, in the case of loans
secured by deposits in the bank to (a) any one or more of the Banks directors,
(b) to any shareholder of the bank who directly or indirectly owns 5% or more
of the outstanding and issued capital stock of the bank, (c) to 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) to any

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company or entity in which the bank or any one of its directors or
officers can exercise a controlling influence, (e) to any company or entity in
which the bank or any one of its directors or officers owns 20% or more of the
outstanding and issued capital stock of such company or entity or (f) to
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 Superintendence of Banks has
the power to allow Exempted Banks not to take into consideration loans granted
to other banks for purposes of determining compliance with the above lending
limits, provided that certain conditions of transparency and independence are
met, as prescribed under the Banking Law.

The Banking Law contains further limitations and restrictions with respect
to loans and credit facilities to parties related to the lending banks. For
instance, under the Banking Law, all loans made to managers, officers,
employees or shareholders who are owners of 5% or more of the lending Banks
outstanding and issued capital stock shall 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. In addition, shares of a bank cannot be
pledged or offered as security for loans or credit facilities issued by such
bank.

In addition to the foregoing requirements, there are certain other
restrictions applicable to General License Banks, including (i) a requirement
that a bank must notify the Superintendence of Banks before opening a branch or
office in Panama and obtain approval from the Superintendence of Banks before
opening a branch or subsidiary outside Panama and (ii) a requirement that a
bank obtain approval from the Superintendence of Banks before it liquidates its
operations, merges or consolidates with another bank or sells all or
substantially all of its assets.

The Banking Law provides that banks in Panama are subject to inspection by
the Superintendence of Banks, which must take place at least once every two
years. Such supervisory powers of the Superintendence of Banks also extend to
a banks subsidiaries and branches. BLADEX was last inspected in 2001 by the
Superintendence of Banks. The result of the inspection was fully satisfactory.
BLADEX is required to file monthly balance sheets and related financial
statements with the Superintendence of Banks. Additionally, banks are required
to file with the Superintendence of Banks quarterly and annual statements
indicating the performance of their credit facilities and other reports and
information, as prescribed by the Superintendence of Banks. In addition, banks
are required to make available for inspection their accounting records,
minutes, reports on cash on hand, securities, receipts, and any other reports
or documents that are necessary for the Superintendence of Banks to ensure
compliance with Panamanian banking laws and regulations. Banks subject to
supervision may be fined by the Superintendence of Banks for violations of
Panamanian banking laws and regulations. The Bank has advised the
Superintendence of Banks of its recent decision to increase its allowance for
credit losses in connection with its exposure to Argentina and to formulate a
recapitalization plan and will continue to keep the Superintendence of Banks
advised of further developments with respect to its Argentine credit portfolio
and the progress of its recapitalization plan.

Under the Banking Law, the Superintendence of Banks may order the
reorganization of a bank when it considers this course of action to be in the
best interests of the depositors, and to guarantee the solvency and continuity
of such bank. The Superintendence of Banks is given broad powers to reorganize
a bank. The Superintendence of Banks may request the shareholders of a bank to
pay in additional capital or authorize the issuance of new shares and the sale
of such shares to third parties at prices pre-determined by the Superintendence
of Banks. Furthermore, the Superintendence of Banks may recommend fundamental
restructuring schemes, including merger or consolidation with other banks,
negotiation of bridge loans, sale or partial liquidation of assets and granting
of security interests in connection with such reorganization plans.
Ultimately, if the reorganization of the applicable bank fails, the
Superintendence of Banks may begin the liquidation process.

The Banking Law has established an annual supervisory charge to be paid by
General License Banks equal to $30,000 plus $35.00 per $1 million in assets,
with the latter amount being limited to a maximum charge of $100,000. The
total amount due in this regard by BLADEX for the year 2001 was $130,000.

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Cayman Islands Law

BLADEX Cayman was registered on September 8, 1987, under The Companies Law
(1985 Revision) of the Cayman Islands. BLADEX Cayman is the holder of a
category B banking license issued under the Banks and Trust Companies Law
(2001 Second Revision) of the Cayman Islands (the Banks and Trust Companies
Law). As the holder of a category B banking license, BLADEX Cayman is
licensed to carry on all kinds of banking business in any part of the world
other than the Cayman Islands, subject to the restrictions set forth in Section
6 of the Banks and Trust Companies Law, which restricts the holder of a
category B banking license from taking deposits from persons resident in the
Cayman Islands or investing in any asset representing a claim on any person
resident in the Cayman Islands, subject to certain exceptions in respect of,
inter alia, exempted or ordinary non-resident companies and other licensees.

Banks and trust companies in the Cayman Islands must be licensed under the
Banks and Trust Companies Law. Such license applications are processed by the
Cayman Islands Monetary Authority. Currently, there are approximately 399
banks licensed in the Cayman Islands, of which approximately 88 have a physical
presence in the Cayman Islands. Licensed banks are regulated by the Cayman
Islands Monetary Authority. The Governor-in-Council and the Managing Director
of the Cayman Islands Monetary Authority have wide powers under the Banks and
Trust Companies Law to investigate the activities and review the banking
practices of licensees, and to protect the interests of depositors. The Cayman
Islands Monetary Authority examines the affairs and business of licensees
through examination of audited and unaudited financial statements and other
regular returns, or in any other manner, for the purpose of ensuring compliance
with the Banks and Trust Companies Law. The Governor-in-Council has power to
grant and revoke licenses, impose conditions upon a licensee, appoint advisers
to licensees and appoint a receiver or manager of a licensee, though these
functions are in the process of being transferred to the Cayman Islands
Monetary Authority.

The International Convergence of Capital Measurement and Capital Standards
established by the Basle Committee on Banking Regulations and Supervisory
Practices have been adopted by the Cayman Islands Monetary Authority. The
registered office of BLADEX Cayman is at the UBS House, P.O. Box 1989, Elgin
Avenue, George Town, Grand Cayman, Cayman Islands, British West Indies.

United States

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 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. In this regard,
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
deposit-taking activities.

The Superintendent is empowered by law to require any agency of a foreign
bank to maintain in New York specified assets equal to a percentage of the
agencys liabilities, as the Superintendent may designate. At present, the
Superintendent has set this percentage at the greater of 5% of the New York
Agencys total assets or 1% of the consolidated total assets of the New York
Agency and New York I.B.F. (International Banking Facility) or $1.0 million,
although specific asset maintenance requirements may be imposed upon individual
agencies of foreign banks on a case-by-case basis. No such special requirement
has been prescribed for the New York 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

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of creditors which arose out of transactions with the agency are granted a
priority with respect to the agencys assets over other creditors of the
foreign bank.

Federal Law. In addition to being subject to New York State laws and
regulations, the New York Agency is subject to federal regulations, primarily
under the International Banking Act of 1978 (the IBA). The IBA generally
extends federal banking supervision and regulation to the United States offices
of foreign banks. Under the IBA, the United States 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 is also subject to
reporting and examination requirements imposed by the Federal Reserve Board
similar to those imposed on domestic banks that are members of the Federal
Reserve System. In this regard, the Foreign Bank Supervision Enhancement Act
of 1991 (the FBSEA) has amended the IBA to enhance the authority of the
Federal Reserve Board to supervise the operations of foreign banks in the
United States. In particular, the FBSEA has expanded the 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 Office of the Comptroller of the Currency of the
Treasury Department (OCC), rather than by a state), unless the Federal
Reserve Board has determined that such activity is consistent with sound
banking practices. 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 United States bank holding company.
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 has
qualified and registered with the Federal Reserve Board to be a financial
holding company (FHC). As of the date hereof, BLADEX has not registered
with the Federal Reserve Board as an FHC.

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.

Organizational Structure

See  History and Development of the Company.

Property, Plant and Equipment

The Bank owns its principal offices located at Calle 50 y Aquilino de La
Guardia in Panama City, which were completed in 1983. The building, with
office space of 3,457 square meters, is used solely by the Bank and is located
on a 2,672 square meter site in the banking district of the city. During 1997,
the Bank expanded its principal office space to accommodate the Banks existing
growth. In early 1999, the Bank rented office space in a nearby building,
expanding its office space by 622 square meters. In addition, the Bank leases
the following office space: (i) 150 square meters for its Buenos Aires
Representative Office at Ave. Corrientes 617, 9 Piso, Buenos Aires, Argentina,
(ii) 149 square meters for BLADEX Representacao Ltda. at Rua Leopoldo Couto de
Magalhäes Junior 110, 9o Andar, Sao Paulo, SP, Brazil, and (iii) 130 square
meters for its Mexico City Representative Office at Ruben Dario 281, Oficina No
1203, Colonia Bosque de Chapultepec, Mexico City, Mexico. Prior to the attack
on New Yorks World Trade Center on September 11, 2001, the Bank leased 967
square meters of office space for its New York Agency and BLADEX Securities,
LLC at One World Trade Center, Suite No. 3227, New York City. On October 1,
2001, the Bank began leasing 678 square meters of office space for its New York
operations, including the New York Agency and BLADEX Securities, LLC, at 641

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##### Table of Contents



Lexington Avenue, 32nd Floor, New York, NY 10022. See also Note 8 of the
Notes to the Consolidated Financial Statements.




Item 5. Operating and Financial Review and Prospects

Operating Results

The Bank derives its income principally from net interest income and, to a
lesser extent, from fee income. Net interest income (the difference between
the interest income the Bank receives on interest-earning assets and the
interest it pays on interest-bearing liabilities) is generated mostly by the
Banks lending activities. Fee income is generated by the issuance,
confirmation and negotiation of letters of credit and guarantees covering
commercial and country risk, loan origination and sales and, to a lesser
extent, foreign exchange activities.

Although inflation rates in the Region remained in the single digits
during 1999, fears of inflation resulting from currency devaluation, among
other factors, lead to increases in interest rates, which caused recessionary
pressures in many of the countries in the Region. The economic slowdown in a
majority of the Banks target markets affected trade flows and the demand for
credit, which contributed to the decline in the Banks credit portfolio in
1999. However, the recessionary environment also negatively affected financial
markets risk perception of the Region and as a result the Bank benefited from
improved lending margins.

In 2000, economic recovery in several of the Banks target markets was
much slower than expected. Business opportunities for the Bank were adversely
affected by political and fiscal events, which diminished the economic
stability of some countries in its market. At the same time, improved
sentiment in financial markets towards the Region, particularly towards its
largest markets, contributed to an increase in the availability of credit,
which put pressure on lending margins.

The operating environment in the Latin American region deteriorated
throughout 2001. This increased the risk perception of the Region and
contributed directly to a less successful performance by the Bank than
expected. The events of September 11 and their aftermath worsened already
deteriorating economic conditions worldwide. The prolonged deterioration in
Argentinas economic and political environment, financial condition and
investor confidence therein resulted in a profound crisis which forced the
Argentine government to adopt stringent measures and had an impact on the
Banks Argentine portfolio at the end of the year. These factors resulted in
the Bank making an approximately $77 million provision for credit losses and
recognizing an approximately $40 million impairment loss on securities in 2001
which reduced net income dramatically compared to 2000. See also Key
Information  Risk Factors  Regional Economic Conditions.

The following table summarizes changes in components of the Banks net
income and performance at and for the periods indicated below.

|                                                      |  |                                        |          |      |  |      |          |   |  |   |          |  
|----------------------------------------------------- |  | -------------------------------------- | -------- | ---- |  | ---- | -------- | - |  | - | -------- | -
|                                                      |  | At and For the Year Ended December 31,
|                                                      |  |                                       
|                                                      |  | 1999                                   |          | 2000 |  | 2001
|                                                      |  |                                        |          |      |  |     
|                                                      |  | (in thousands, except per share       
|                                                      |  | amounts and percentages)              
|                                                      |  |                                       
|Total interest income                                 |  | $                                      | 368,934  |      |  | $    | 402,586  |   |  | $ | 378,454  |  
|                                                     
|                                                     
|                                                     
|                                                     
|Total interest expense                                |  |                                        | (256,236 | )    |  |      | (289,916 | ) |  |   | (259,683 | )
|                                                      |  |                                        |          |      |  |      |          |   |  |   |          |  
|Net interest income                                   |  |                                        | 112,698  |      |  |      | 112,670  |   |  |   | 118,771  |  
|                                                     
|                                                     
|                                                     
|                                                     
|Provision for loan losses                             |  |                                        | (14,700  | )    |  |      | (8,000   | ) |  |   | (77,144  | )
|                                                      |  |                                        |          |      |  |      |          |   |  |   |          |  
|Net interest income after provision for loan losses   |  |                                        | 97,998   |      |  |      | 104,670  |   |  |   | 41,627   |  
|                                                     
|                                                     
|                                                     
|                                                     
|Other income (expense):                               |  |                                        |          |      |  |      |          |   |  |   |          |  
|                                                     
|                                                     
|                                                     
|                                                     
|Net commission income                                 |  |                                        | 25,480   |      |  |      | 24,742   |   |  |   | 13,691   |  
|                                                     
|                                                     
|                                                     
|                                                     
|Provision for losses on off balance sheet credit risk |  |                                        | (6,000   | )    |  |      | (11,200  | ) |  |   |         |  
|                                                     
|                                                     
|                                                     
|                                                     
|Derivatives and hedging activities                    |  |                                        |         |      |  |      |         |   |  |   | 7,379    |  
|                                                     
|                                                     
|                                                     
|                                                     
|Impairment loss on securities                         |  |                                        |         |      |  |      |         |   |  |   | (40,356  | )

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|                                                                                                               |  |                                        |         |      |  |      |        |   |  |   |         |  
|-------------------------------------------------------------------------------------------------------------- |  | -------------------------------------- | ------- | ---- |  | ---- | ------ | - |  | - | ------- | -
|                                                                                                               |  | At and For the Year Ended December 31,
|                                                                                                               |  |                                       
|                                                                                                               |  | 1999                                   |         | 2000 |  | 2001
|                                                                                                               |  |                                        |         |      |  |     
|                                                                                                               |  | (in thousands, except per share       
|                                                                                                               |  | amounts and percentages)              
|                                                                                                               |  |                                       
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Gains on sale of securities available for sale                                                                 |  |                                        |        |      |  |      |       |   |  |   | 4,798   |  
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Other income                                                                                                   |  |                                        | 193     |      |  |      | 89     |   |  |   | 654     |  
|                                                                                                               |  |                                        |         |      |  |      |        |   |  |   |         |  
|Net other income (expense)                                                                                     |  |                                        | 19,673  |      |  |      | 13,631 |   |  |   | (13,834 | )
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Total operating expenses                                                                                       |  |                                        | 16,578  |      |  |      | 21,180 |   |  |   | 26,394  |  
|                                                                                                               |  |                                        |         |      |  |      |        |   |  |   |         |  
|Net income before income tax and cumulative effect
of accounting changes                                       |  |                                        | 101,093 |      |  |      | 97,121 |   |  |   | 1,399   |  
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Income tax                                                                                                     |  |                                        | 36      |      |  |      | 65     |   |  |   | 35      |  
|                                                                                                               |  |                                        |         |      |  |      |        |   |  |   |         |  
|Net Income before cumulative effect of accounting
changes                                                      |  |                                        | 101,057 |      |  |      | 97,056 |   |  |   | 1,364   |  
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Cumulative effect on accounting changes                                                                        |  |                                        |        |      |  |      |       |   |  |   | 1,129   |  
|                                                                                                               |  |                                        |         |      |  |      |        |   |  |   |         |  
|Net income                                                                                                     |  | $                                      | 101,057 |      |  | $    | 97,056 |   |  | $ | 2,494   |  
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Net income after preferred stock dividend per
common share and after cumulative effect of
accounting change    |  | $                                      | 4.95    |      |  | $    | 4.83   |   |  | $ | 0.06    |  
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Return on average assets after cumulative effect of
accounting change                                          |  |                                        | 1.93    | %    |  |      | 1.92   | % |  |   | 0.04    | %
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Return on average common stockholders equity after
cumulative effect of accounting change                     |  |                                        | 15.68   | %    |  |      | 13.98  | % |  |   | 0.16    | %
|                                                                                                              
|                                                                                                              
|                                                                                                              
|                                                                                                              
|Return on average common stockholders
equity and preferred stock after cumulative
effect of accounting change |  |                                        | 15.27   | %    |  |      | 13.65  | % |  |   | 0.16    | %

Net Interest Income

Net interest income, which constitutes the principal source of income for
the Bank, increased from $112.7 million in 1999 and 2000 to $118.8 million in
2001. Net interest income in 2000 was almost the same as 1999 because lower
interest earning assets and margins were offset by higher return on available
capital funds due to higher interest rates in 2000 as compared to 1999. The
increase in net interest income in 2001 was due primarily to the 17% growth of
the average loan portfolio (loans and investment securities) and the positive
effect of the interest rate gap. These factors were offset by lower average
lending margins and lower interest income on available capital funds generated
by a lower interest rate environment in 2001 as compared to 2000.

The Bank believes that the most important factors that affect net interest
income are operating net interest income, the effect of the interest rate gap,
interest income on available capital funds and one-time interest income and
adjustments. Operating net interest income consists of interest income
generated by the Banks lending activities, which is the difference between
average lending margins and the marginal cost of funds. Operating net interest
income increased from $58.7 million in 2000 to $67.0 million in 2001, due to
the 17% growth in the loan portfolio, which offset lower lending margins in
2001 as compared to 2000. The effect of the interest rate gap consists of
interest income generated by the mismatch between the maturities of assets and
the maturities of liabilities. The Banks short-term loan portfolio has an
average life of 242 days and is priced based on the London Interbank Offered
Rate (LIBOR) for periods corresponding to the individual loan maturities. A
portion of these loans is funded by deposits, which have an average life of 78
days. As a result, deposits reprice faster than loans. In a declining
interest rate environment, the Bank benefits from the effect of the interest
rate gap. The Bank estimates that the effect of the interest rate gap during
2001 was the generation of $18.6 million of interest income as interest rates
declined over 235 basis points in 2001. Interest income generated by available
capital funds is sensitive to market interest rates, as capital funds are used
to finance mostly short-term interest earning assets, which are priced based on
LIBOR. During 2001, interest rates declined over 235 basis points in relation
to 2000, resulting in $34.0 million of interest income generated on available
capital funds, compared to $51.2

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##### Table of Contents



million in 2000. One-time interest income and adjustments include
interest received on loans which have been classified as non-accruing and the
reversal of accrued interest when assets are classified as non-accruing. The
following table sets forth information regarding net interest income for the
periods indicated below.

|                                           |  |                    |       |      |  |      |       |  |  |   |       |  
|------------------------------------------ |  | ------------------ | ----- | ---- |  | ---- | ----- |  |  | - | ----- | -
|                                           |  | For the Year Ended
|                                           |  | December 31,      
|                                           |  |                   
|                                           |  | 1999               |       | 2000 |  | 2001
|                                           |  |                    |       |      |  |     
|                                           |  | (in millions)     
|                                           |  |                   
|Operating net interest income              |  | $                  | 72.8  |      |  | $    | 58.7  |  |  | $ | 67.0  |  
|                                          
|                                          
|                                          
|                                          
|Effect of interest rate gap                |  |                    | 1.0   |      |  |      | 0.5   |  |  |   | 18.6  |  
|                                          
|                                          
|                                          
|                                          
|Interest income on available capital funds |  |                    | 39.7  |      |  |      | 51.3  |  |  |   | 34.0  |  
|                                          
|                                          
|                                          
|                                          
|One-time interest income and adjustments   |  |                    | (0.8  | )    |  |      | 2.2   |  |  |   | (0.8  | )
|                                           |  |                    |       |      |  |      |       |  |  |   |       |  
|Net interest income                        |  | $                  | 112.7 |      |  | $    | 112.7 |  |  | $ | 118.8 |  

In 2001, the net interest spread increased to 1.32% from 1.14% in 2000 and
from 1.30% in 1999. The decrease in the net interest spread during 2000 in
relation to 1999 was mostly attributable to lower lending margins. The increase
in the net interest spread during 2001 in relation to 2000 was mostly
attributable to the positive effect of lower interest rates on the Banks
interest rate gap.

In 2001, the net interest margin decreased to 2.00% from 2.24% in 2000 and
2.15% in 1999. The decline of 24 basis points in the net interest margin for
2001 compared to 2000 was mainly due to: (i) lower interest rates which
generated a lower return on the Banks available capital funds, but at the same
time had a positive effect on the Banks interest rate gap, resulting in a
negative effect of 14 basis points on the net interest margin; (ii) lower net
lending margins, which had a negative effect of 4 basis points on the net
interest margin; and (iii) the reversal of accrued interest on certain loans
and investments classified as non-accruing loans and impaired investments net
of interest income received related to such loans and investments, which had a
negative effect of 6 basis points on the net interest margin.

During 2000, the net interest margin increased 9 basis points compared to
1999 (from 2.15% in 1999 to 2.24% in 2000). This increase was mainly due to:
(i) lower net lending margins resulting from lower demand and improved risk
perception of the largest countries in the Region, which had a negative effect
of 23 basis points on the net interest margin; (ii) a higher equity to debt
ratio combined with higher interest rates, which generated a higher return on
the Banks available capital funds, resulting in a positive effect of 25 basis
points on the net increase in the net interest margin; and (iii) one time
interest income and adjustments, which had a positive effect of 6 basis points
on the increase in the net interest margin. The one time interest income
constituted $1.7 million of interest income received during 2000 related to an
impaired/cash basis asset and an adjustment to interest income of $0.5 million
made during the first quarter of 2000 that corresponded to interest income from
the third and fourth quarters of 1999.

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

The following table presents for the periods indicated the distribution of
consolidated average assets, liabilities and common stockholders equity as
well as the total dollar amounts of interest income from average
interest-earning assets and the resulting yields, and the dollar amounts of
interest expense and average interest-bearing liabilities, and corresponding
information regarding rates. Non-accruing loans are included in the
calculation of the average balance of loans and interest not accrued is
excluded. Average balances have been computed on the basis of consolidated
daily average balance sheets.

33



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##### Table of Contents



Average Balance Sheet Assets, Liabilities and
Common Stockholders Equity and Interest Income and Expense

|                                                                              |              |                                    |                         |           |      |                   |         |                 |  |          |      |                    |   |                 |           |           |  |                    |         |         |  |  |      |      |   |   |           |           |  |   |         |        |  |  |      |      |  
|----------------------------------------------------------------------------- | ------------ | ---------------------------------- | ----------------------- | --------- | ---- | ----------------- | ------- | --------------- |  | -------- | ---- | ------------------ | - | --------------- | --------- | --------- |  | ------------------ | ------- | ------- |  |  | ---- | ---- | - | - | --------- | --------- |  | - | ------- | ------ |  |  | ---- | ---- | -
|                                                                              |              |                                    | Year Ended December 31,
|                                                                              |              |                                    |                        
|                                                                              |              |                                    | 1999                    |           | 2000 |                   | 2001   
|                                                                              |              |                                    |                         |           |      |                   |        
|Description                                                                   |              | AverageBalance                     |                         | Interest  |      | AverageYield/Rate |         | Average Balance |  | Interest |      | Average Yield/Rate |   | Average Balance |           | Interest  |  | Average Yield/Rate
|                                                                              |              |                                    |                         |           |      |                   |         |                 |  |          |      |                    |   |                 |           |           |  |                   
|INTEREST-EARNING ASSETS                                                       |              | (in thousands, except percentages)
|                                                                              |              |                                    |                         |           |      |                   |         |                 |  |          |      |                    |   |                 |           |           |  |                   
|Deposits & money market instruments                                           |              | $                                  | 281,673                 |           |      | $                 | 14,158  |                 |  |          | 4.96 | %                  |   | $               | 285,022   |           |  | $                  | 17,962  |         |  |  | 6.20 | %    |   | $ | 95,190    |           |  | $ | 14,259  |        |  |  | 3.56 | %   
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Loan portfolio, net                                                           |              |                                    | 4,772,837               |           |      |                   | 343,539 |                 |  |          | 7.10 |                    |   |                 | 4,437,714 |           |  |                    | 358,223 |         |  |  | 7.94 |      |   |   | 5,101,270 |           |  |   | 330,338 |        |  |  | 6.39 |     
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Non-accruing loans                                                            |              |                                    | 18,101                  |           |      |                   |         |                 |  |          |      |                    |   |                 | 25,534    |           |  |                    |         |         |  |  |      |      |   |   | 12,636    |           |  |   |         |        |  |  |      |     
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Investment securities                                                         |              |                                    | 162,953                 |           |      |                   | 11,237  |                 |  |          | 6.80 |                    |   |                 | 286,276   |           |  |                    | 26,401  |         |  |  | 9.07 |      |   |   | 434,166   |           |  |   | 33,857  |        |  |  | 7.69 |     
|                                                                              |              |                                    |                         |           |      |                   |         |                 |  |          |      |                    |   |                 |           |           |  |                    |         |         |  |  |      |      |   |   |           |           |  |   |         |        |  |  |      |     
|TOTAL INTEREST-EARNING
ASSETS                                                 |              | $                                  | 5,235,564               |           |      | $                 | 368,934 |                 |  |          | 6.95 | %                  |   | $               | 5,034,546 |           |  |                    | 402,586 |         |  |  | 7.87 | %    |   | $ | 5,943,262 |           |  |   | 378,454 |        |  |  | 6.28 | %   
|                                                                              |              |                                    |                         |           |      |                   |         |                 |  |          |      |                    |   |                 |           |           |  |                    |         |         |  |  |      |      |   |   |           |           |  |   |         |        |  |  |      |     
|Non-interest earning Assets                                                   |              | $                                  | 120,919                 |           |      |                   |         |                 |  |          |      |                    |   | $               | 130,117   |           |  |                    |         |         |  |  |      |      |   | $ | 146,149   |           |  |   |         |        |  |  |      |     
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Allowance for possible credit losses                                          |              |                                    | (118,569                | )         |      |                   |         |                 |  |          |      |                    |   |                 | (118,910  | )         |  |                    |         |         |  |  |      |      |   |   | (116,127  | )         |  |   |         |        |  |  |      |     
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Other assets                                                                  |              |                                    | 7,910                   |           |      |                   |         |                 |  |          |      |                    |   |                 | 12,313    |           |  |                    |         |         |  |  |      |      |   |   | 29,441    |           |  |   |         |        |  |  |      |     
|                                                                              |              |                                    |                         |           |      |                   |         |                 |  |          |      |                    |   |                 |           |           |  |                    |         |         |  |  |      |      |   |   |           |           |  |   |         |        |  |  |      |     
|                                                                              | TOTAL ASSETS |                                    | $                       | 5,245,824 |      |                   |         |                 |  |          |      |                    |   |                 | $         | 5,058,066 |  |                    |         |         |  |  |      |      |   |   | $         | 6,002,725 |  |   |         |        |  |  |      |      |  
|                                                                              |              |                                    |                         |           |      |                   |         |                 |  |          |      |                    |   |                 |           |           |  |                    |         |         |  |  |      |      |   |   |           |           |  |   |         |        |  |  |      |     
|INTEREST-BEARING LIABILITIES                                                  |              |                                    |                         |           |      |                   |         |                 |  |          |      |                    |   |                 |           |           |  |                    |         |         |  |  |      |      |   |   |           |           |  |   |         |        |  |  |      |     
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Deposits                                                                      |              |                                    |                         |           |      |                   |         |                 |  |          |      |                    |   |                 |           |           |  |                    |         |         |  |  |      |      |   |   |           |           |  |   |         |        |  |  |      |     
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|                                                                              | Demand       |                                    | $                       | 9,317     |      |                   | $       | 189             |  |          |      | 2.00               | % |                 | $         | 9,924     |  |                    | $       | 204     |  |  |      | 2.03 | % |   | $         | 5,815     |  |   | $       | 42     |  |  |      | 0.72 | %
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|                                                                              | Time         |                                    |                         | 1,488,893 |      |                   |         | 79,125          |  |          |      | 5.24               |   |                 |           | 1,675,413 |  |                    |         | 108,478 |  |  |      | 6.37 |   |   |           | 1,733,010 |  |   |         | 74,480 |  |  |      | 4.24 |  
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Short-term borrowings & placements                                            |              |                                    | 1,717,519               |           |      |                   | 100,462 |                 |  |          | 5.77 |                    |   |                 | 1,258,492 |           |  |                    | 87,238  |         |  |  | 6.82 |      |   |   | 1,705,731 |           |  |   | 89,357  |        |  |  | 5.17 |     
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Medium and long-term borrowings and
placements                                |              |                                    | 1,258,382               |           |      |                   | 76,460  |                 |  |          | 5.99 |                    |   |                 | 1,296,550 |           |  |                    | 93,996  |         |  |  | 7.13 |      |   |   | 1,714,333 |           |  |   | 95,803  |        |  |  | 5.51 |     
|                                                                              |              |                                    |                         |           |      |                   |         |                 |  |          |      |                    |   |                 |           |           |  |                    |         |         |  |  |      |      |   |   |           |           |  |   |         |        |  |  |      |     
|TOTAL INTEREST-BEARING LIABILITIES                                            |              | $                                  | 4,474,111               |           |      | $                 | 256,236 |                 |  |          | 5.65 | %                  |   | $               | 4,240,379 |           |  | $                  | 289,916 |         |  |  | 6.72 | %    |   | $ | 5,158,889 |           |  | $ | 259,682 |        |  |  | 4.96 | %   
|                                                                              |              |                                    |                         |           |      |                   |         |                 |  |          |      |                    |   |                 |           |           |  |                    |         |         |  |  |      |      |   |   |           |           |  |   |         |        |  |  |      |     
|Non-interest bearing Liabilities                                              |              | $                                  | 118,870                 |           |      |                   |         |                 |  |          |      |                    |   | $               | 115,883   |           |  |                    |         |         |  |  |      |      |   | $ | 128,638   |           |  |   |         |        |  |  |      |     
|                                                                              |              |                                    |                         |           |      |                   |         |                 |  |          |      |                    |   |                 |           |           |  |                    |         |         |  |  |      |      |   |   |           |           |  |   |         |        |  |  |      |     
|TOTAL LIABILITIES                                                             |              | $                                  | 4,592,981               |           |      |                   |         |                 |  |          |      |                    |   | $               | 4,356,262 |           |  |                    |         |         |  |  |      |      |   | $ | 5,287,527 |           |  |   |         |        |  |  |      |     
|                                                                              |              |                                    |                         |           |      |                   |         |                 |  |          |      |                    |   |                 |           |           |  |                    |         |         |  |  |      |      |   |   |           |           |  |   |         |        |  |  |      |     
|Redeemable Preferred Stock                                                    |              | $                                  | 17,160                  |           |      |                   |         |                 |  |          |      |                    |   | $               | 16,689    |           |  |                    |         |         |  |  |      |      |   | $ | 15,387    |           |  |   |         |        |  |  |      |     
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Common stockholders equity                                                   |              | $                                  | 635,683                 |           |      |                   |         |                 |  |          |      |                    |   | $               | 685,115   |           |  |                    |         |         |  |  |      |      |   | $ | 699,811   |           |  |   |         |        |  |  |      |     
|                                                                              |              |                                    |                         |           |      |                   |         |                 |  |          |      |                    |   |                 |           |           |  |                    |         |         |  |  |      |      |   |   |           |           |  |   |         |        |  |  |      |     
|TOTAL LIABILITIES, REDEEMABLE
PREFERRED STOCK AND COMMON
STOCKHOLDERS EQUITY |              | $                                  | 5,245,824               |           |      |                   |         |                 |  |          |      |                    |   | $               | 5,058,066 |           |  |                    |         |         |  |  |      |      |   | $ | 6,002,725 |           |  |   |         |        |  |  |      |     
|                                                                              |              |                                    |                         |           |      |                   |         |                 |  |          |      |                    |   |                 |           |           |  |                    |         |         |  |  |      |      |   |   |           |           |  |   |         |        |  |  |      |     
|NET INTEREST SPREAD(1)                                                        |              |                                    |                         |           |      |                   |         |                 |  |          | 1.30 | %                  |   |                 |           |           |  |                    |         |         |  |  | 1.14 | %    |   |   |           |           |  |   |         |        |  |  | 1.32 | %   
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|NET INTEREST INCOME AND NET
INTEREST MARGIN(2)                                |              |                                    |                         |           |      | $                 | 112,698 |                 |  |          | 2.15 | %                  |   |                 |           |           |  | $                  | 112,670 |         |  |  | 2.24 | %    |   |   |           |           |  | $ | 118,772 |        |  |  | 2.00 | %   
|                                                                              |              |                                    |                         |           |      |                   |         |                 |  |          |      |                    |   |                 |           |           |  |                    |         |         |  |  |      |      |   |   |           |           |  |   |         |        |  |  |      |     



---

|(1) |  | Net interest spread represents the average yield earned on
interest-earning assets less the average rate paid on interest-bearing
liabilities.                      
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|   
|   
|(2) |  | Net interest margin is computed by dividing net interest income (total
interest earned minus total interest paid) by the average balance of
interest-earning assets.

Changes in Net Interest Income  Volume and Rate Analysis

Net interest income is affected by changes in volume and changes in 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 analysis of changes in
net interest income of the Bank resulting from changes in average
interest-earning asset and interest-bearing liability balances (volume) and
changes in average interest rates for 1999 compared to 2000 and for 2000
compared to 2001. 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 rate have been allocated equally
to volume and rate.

|                                       |  |   |                |   |               |   |            |  |        |   |        |  |            |   |        |  |  |   |         |   |  |   |         |   | 
|-------------------------------------- |  | - | -------------- | - | ------------- | - | ---------- |  | ------ | - | ------ |  | ---------- | - | ------ |  |  | - | ------- | - |  | - | ------- | - | 
|                                       |  |   | 1999 vs. 2000  |   | 2000 vs. 2001
|                                       |  |   |                |   |              
|                                       |  |   | Volume         |   | Rate          |   | Net Change |  | Volume |   | Rate   |  | Net Change
|                                       |  |   |                |   |               |   |            |  |        |   |        |  |           
|                                       |  |   | (in thousands)
|INCREASE (DECREASE) IN
INTEREST INCOME |  |   |                |   |               |   |            |  |        |   |        |  |            |   |        |  |  |   |         |   |  |   |         |  
|                                      
|                                      
|                                      
|                                      
|Deposits & money market Instruments    |  | $ | 190            |   |               | $ | 3,614      |  |        | $ | 3,804  |  |            | $ | 5,459  |  |  | $ | (9,161  | ) |  | $ | (3,702  | )
|                                      
|                                      
|                                      
|                                      
|Loans, net                             |  |   | (25,587        | ) |               |   | 40,271     |  |        |   | 14,684 |  |            |   | 48,267 |  |  |   | (76,152 | ) |  |   | (27,885 | )
|                                      
|                                      
|                                      
|                                      

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##### Table of Contents



|                                             |        |   |                |        |               |   |            |        |        |   |         |        |            |   |        |       |   |   |         |         |   |   |         |         |  
|-------------------------------------------- | ------ | - | -------------- | ------ | ------------- | - | ---------- | ------ | ------ | - | ------- | ------ | ---------- | - | ------ | ----- | - | - | ------- | ------- | - | - | ------- | ------- | -
|                                             |        |   | 1999 vs. 2000  |        | 2000 vs. 2001
|                                             |        |   |                |        |              
|                                             |        |   | Volume         |        | Rate          |   | Net Change |        | Volume |   | Rate    |        | Net Change
|                                             |        |   |                |        |               |   |            |        |        |   |         |        |           
|                                             |        |   | (in thousands)
|Non-accruing loans                           |        |   |               |        |               |   |           |        |        |   |        |        |            |   |       |       |   |   |        |         |   |   |        |        
|                                            
|                                            
|                                            
|                                            
|Investment securities                        |        |   | 9,939          |        |               |   | 5,225      |        |        |   | 15,164  |        |            |   | 12,586 |       |   |   | (5,130  | )       |   |   | 7,456   |        
|                                             |        |   |                |        |               |   |            |        |        |   |         |        |            |   |        |       |   |   |         |         |   |   |         |        
|TOTAL INCREASE (DECREASE)                    |        | $ | (15,458        | )      |               | $ | 49,110     |        |        | $ | 33,652  |        |            | $ | 66,312 |       |   | $ | (90,443 | )       |   | $ | (24,131 | )      
|                                             |        |   |                |        |               |   |            |        |        |   |         |        |            |   |        |       |   |   |         |         |   |   |         |        
|INCREASE (DECREASE) IN INTEREST
EXPENSE      |        |   |                |        |               |   |            |        |        |   |         |        |            |   |        |       |   |   |         |         |   |   |         |        
|                                            
|                                            
|                                            
|                                            
|Deposits                                     |        |   |                |        |               |   |            |        |        |   |         |        |            |   |        |       |   |   |         |         |   |   |         |        
|                                            
|                                            
|                                            
|                                            
|                                             | Demand |   |                | 12     |               |   |            | 3      |        |   |         | 15     |            |   |        | (57   | ) |   |         | (105    | ) |   |         | (162    | )
|                                            
|                                            
|                                            
|                                            
|                                             | Time   |   |                | 10,994 |               |   |            | 18,358 |        |   |         | 29,352 |            |   |        | 3,102 |   |   |         | (37,100 | ) |   |         | (33,998 | )
|                                            
|                                            
|                                            
|                                            
|Short-term borrowings & placements           |        |   | (29,335        | )      |               |   | 16,110     |        |        |   | (13,225 | )      |            |   | 27,216 |       |   |   | (25,097 | )       |   |   | 2,120   |        
|                                            
|                                            
|                                            
|                                            
|Medium and long-term borrowings &
placements |        |   | 2,543          |        |               |   | 14,993     |        |        |   | 17,536  |        |            |   | 26,818 |       |   |   | (25,011 | )       |   |   | 1,807   |        
|                                             |        |   |                |        |               |   |            |        |        |   |         |        |            |   |        |       |   |   |         |         |   |   |         |        
|TOTAL INCREASE (DECREASE)                    |        | $ | (15,786        | )      |               | $ | 49,464     |        |        | $ | 33,678  |        |            | $ | 57,079 |       |   | $ | (87,313 | )       |   | $ | (30,234 | )      
|                                             |        |   |                |        |               |   |            |        |        |   |         |        |            |   |        |       |   |   |         |         |   |   |         |        
|INCREASE (DECREASE) IN NET
INTEREST INCOME   |        | $ | 328            |        |               | $ | (354       | )      |        | $ | (26     | )      |            | $ | 9,233  |       |   | $ | (3,130  | )       |   | $ | 6,102   |        
|                                             |        |   |                |        |               |   |            |        |        |   |         |        |            |   |        |       |   |   |         |         |   |   |         |        

Provision for Loan Losses

During 2001, the Bank provisioned $77.1 million to the allowance for loan
losses, compared to $8 million in 2000. The higher provision for loan losses
was mostly related to the Banks exposure in Argentina. The Bank has decided to
increase the allowance for loan losses substantially, as described under Key
Information  Risk Factors  Regional Conditions, also related to its exposure
in Argentina. The Bank makes an allowance for loan losses resulting from an
impaired loan by comparing the net present value of the expected cash flows
from the loan discounted at the effective interest rate of the loan and the
carrying value of the loan. The Bank also maintains a loan loss reserve which
is estimated using a provisioning matrix model and other factors. See
Information on the Company  Business Overview  Loan Portfolio  Allowance
for Credit Losses. Although the Bank believes that its allowance for credit
losses will be adequate to cover all known losses in its credit portfolio,
there can be no assurance that the provisions will be adequate to cover any
further increase in the amount of impaired loans or any further deterioration
in its impaired loan portfolio. During 2001, the Bank identified impaired
loans in Argentina in the amount of $97 million. See Key Information  Risk
Factors  Regional Economic Conditions.

Commission Income

The Banks commission income decreased by 2% from $26.5 million in 1999 to
$25.9 million in 2000 and by 42% to $14.9 million in 2001. The decline of
$10.9 million in commission income during 2001, as compared to 2000, resulted
from (i) the decreased volumes and margins in letter of credit confirmations
and guarantees issued (covering both commercial and sovereign risk), income
from which declined by $6.8 million or 32% compared to 2000; and (ii) the
adoption of SFAS 133 on January 1, 2001, pursuant to which the Bank stopped
amortizing the $1.9 million remaining unamortized premium received on certain
options sold in 1997 (which was transferred to the SFAS 133 transition
adjustment), which resulted in commission income being reduced by $1.5 million
in 2001 compared to 2000 (see Quantitative and Qualitative Disclosure About
Market Risk and Note 17 of the Notes to the Consolidated Financial
Statements). During 2001, the sale of assets was concentrated more in
securities available for sale rather than loans, and the income generated from
these sales is reported under gains on sale of securities available for sale.
The following table shows the components of commission income for the periods
set forth below:

35



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##### Table of Contents



|                        |                                |   |                    |        |      |   |        |       |  |   |        |       | 
|----------------------- | ------------------------------ | - | ------------------ | ------ | ---- | - | ------ | ----- |  | - | ------ | ----- | 
|                        |                                |   | For the Year Ended
|                        |                                |   | December 31,      
|                        |                                |   |                   
|                        |                                |   | 1999               |        | 2000 |   | 2001  
|                        |                                |   |                    |        |      |   |       
|                        |                                |   | (in thousands)    
|                        |                                |   |                   
|Letters of credit       |                                | $ | 5,962              |        |      | $ | 7,111  |       |  | $ | 5,794  |      
|                       
|                       
|                       
|                       
|Guarantees:             |                                |   |                    |        |      |   |        |       |  |   |        |      
|                       
|                       
|                       
|                       
|                        | Options                        |   |                    | 2,084  |      |   |        | 1,529 |  |   |        | 0     | 
|                       
|                       
|                       
|                       
|                        | Other guarantees               |   |                    | 5,244  |      |   |        | 7,487 |  |   |        | 5,546 | 
|                       
|                       
|                       
|                       
|                        | Country risk coverage business |   |                    | 10,388 |      |   |        | 6,595 |  |   |        | 3,061 | 
|                       
|                       
|                       
|                       
|Loans                   |                                |   | 1,615              |        |      |   | 2,035  |       |  |   | 428    |      
|                       
|                       
|                       
|                       
|Loan sales              |                                |   | 1,129              |        |      |   | 1,077  |       |  |   | 0      |      
|                       
|                       
|                       
|                       
|Other commission income |                                |   | 68                 |        |      |   | 44     |       |  |   | 105    |      
|                        |                                |   |                    |        |      |   |        |       |  |   |        |      
|TOTAL COMMISSION INCOME |                                | $ | 26,490             |        |      | $ | 25,878 |       |  | $ | 14,934 |      
|                        |                                |   |                    |        |      |   |        |       |  |   |        |      

Derivatives and Hedging Activities

Effective January 1, 2001, the Bank adopted SFAS 133 relating to
accounting for financial instruments that are considered to be derivatives.
Pursuant to SFAS 133, these financial instruments are booked on the balance
sheet at their fair value. The positive change in fair value of derivatives
and hedging activities from January 1, 2001 to December 31, 2001 was $7.4
million, of which options represented $4.4 million and interest rate swaps $2.9
million. The amount of options outstanding at December 31, 2001 was $100
million and the final maturity of these options is in August 2002. See Note 19
(Impact of SFAS 133 on the Banks Financial Statements) of the Consolidated
Financial Statements.

Impairment Loss on Securities

During 2001, the Bank classified $50 million of Argentine securities
(which are part of the Banks credit portfolio) as impaired. Any security that
declines in value, which is deemed other than a temporary decline, is
classified as impaired. These impaired Argentine securities were written down
to their estimated fair value resulting in a charge of $40.4 million to
earnings for 2001. See Note 5 (Investment Securities) of the Consolidated
Financial Statements.

Gains on Sale of Securities Available for Sale

From time to time, the Bank purchases debt instruments with the intention
of selling them as part of its credit portfolio lending activity and classifies
these debt instruments as securities available for sale. During 2001, the Bank
generated income in the amount of $4.8 million from the sale of these
securities available for sale.

Net Revenues

Net revenues (net interest income and commission income less commission
expense plus derivatives and hedging activities plus other income) for the year
ended December 31, 2001 grew 6% compared to the year ended December 31, 2000.
The following table shows the components of net revenues for the periods set
forth below:

|                                               |  |                    |       |      |  |               |       |  |  |   |       | 
|---------------------------------------------- |  | ------------------ | ----- | ---- |  | ------------- | ----- |  |  | - | ----- | 
|                                               |  | As of December 31,
|                                               |  |                   
|                                               |  | 1999               |       | 2000 |  | 2001         
|                                               |  |                    |       |      |  |              
|                                               |  |                    |       |      |  | (in millions) |       |  |  |  
|                                               |  |                   
|Net interest
income                            |  | $                  | 112.7 |      |  | $             | 112.7 |  |  | $ | 118.8 | 
|                                              
|                                              
|                                              
|                                              
|Net
commissions                                |  |                    | 25.5  |      |  |               | 24.7  |  |  |   | 13.7  | 
|                                              
|                                              
|                                              
|                                              
|Derivatives and hedging
activities             |  |                    | 0.0   |      |  |               | 0.0   |  |  |   | 7.4   | 
|                                              
|                                              
|                                              
|                                              
|Gains on sale of securities
available for sale |  |                    | 0.0   |      |  |               | 0.0   |  |  |   | 4.8   | 
|                                              
|                                              
|                                              
|                                              
|Other
income                                   |  |                    | 0.2   |      |  |               | 0.0   |  |  |   | 0.7   | 
|                                               |  |                    |       |      |  |               |       |  |  |   |       | 
|Net
revenues                                   |  | $                  | 138.4 |      |  | $             | 137.5 |  |  | $ | 145.4 | 
|                                               |  |                    |       |      |  |               |       |  |  |   |       | 

36



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##### Table of Contents



Operating Expenses

Operating expenses were $26.4 million in 2001 compared to $21.2 million in
2000 and $16.6 million in 1999. Total operating expenses increased as a
percentage of average total assets from 0.32% in 1999 to 0.42% in 2000 and to
0.44% in 2001. The increases in operating expenses in 1999 and 2000 were
primarily due to normal salary increases and the provision for
performance-based bonuses for employees. The increase in operating expenses
during 2001 was due to continuing investments in technology, strategic
additions to personnel, expenses
associated with our new representative offices, the structured transaction
unit in New York and consulting fees related to business initiatives. To
support the Banks growth initiatives and become more efficient and effective
in serving its customers during 2001, the Bank invested in technology including
the following: the renovation of its core banking computer application; the
creation of decision support applications for loan pricing and client
segmentation; the renovation of computer centers and the computer network, and
the acquisition of additional servers for information and decision support
systems. This investment strategy is designed to exploit Internet technologies
by creating a software and hardware web enabled infrastructure. The Bank
engaged in an internal reorganization of human resources to align personnel
with business processes, operations and technology in a more efficient manner.

Salaries and other employee expenses (including provision for
performance-based bonuses for employees) were the largest component of
operating expenses in 1999, 2000 and 2001, amounting to $9.6 million, $10.6
million and $11.8 million, respectively. The second largest component of
operating expenses was professional services, which amounted to $1.3 million,
$3.9 million and $3.1 million in 1999, 2000 and 2001, respectively. The third
largest component of operating expenses in 2000 and 2001 was pre-operating
cost, which amounted to $0.9 million and $3.0 million in 2000 and 2001,
respectively. The Banks remaining operating expenses consist of
communications, maintenance and repairs, rent of office space and equipment and
other miscellaneous expenses. In the past, the Banks ability to maintain its
low cost structure has been a significant factor in its profitability. For the
years ended December 31, 1999, 2000 and 2001, the Banks efficiency ratio
(total operating expenses divided by the sum of net interest income plus
commission income) was 11.9%, 15.3% and 19.7%, respectively.

Net Income

The Banks net income was $2.5 million in 2001 compared to $97.1 million
in 2000 and $101.1 million in 1999. In 2001, net income decreased by 97% from
2000. The Banks results were affected by a $77.1 million increase in the
Banks allowance for loan losses and the $40.4 million impairment loss on
certain securities with Argentine exposure in the fourth quarter of 2001. See
Risk Factors  Regional Economic Conditions and Information on the Company 
Business Overview  Loan Portfolio  Allowance for Credit Losses,  Impaired
Assets and  Allowance for Credit Losses.

Foreign Exchange Risk Management

The Bank accepts deposits and raises funds principally in United States
dollars, makes loans mostly in United States dollars and presents its
consolidated financial statements in United States dollars.

Whenever possible, foreign-currency-denominated assets are funded with
liability instruments denominated in the same currency. In cases where these
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.

Interest rate swaps less set-offs, with maturities from May 1, 2002 to
November 17, 2003, are matched to the maturity dates of related Euro
medium-term note issuances and to corresponding assets held to maturity as part
of the Banks credit portfolio.

The Bank also engages in some foreign exchange trades to serve customer
transaction needs, and all positions are hedged with an offsetting contract in
the same currency. The Bank manages the risks on these buy

37



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##### Table of Contents



and sell foreign
currency contracts under approved limits of amounts and terms for each
counterparty, and by having adopted policies that do not allow it to maintain
open positions. Interest rate swaps are made either in a single currency or
cross-currency for a prescribed period to exchange a series of interest rate
flows, either fixed for floating rate or vice versa. See the Notes to the
Consolidated Financial Statements, Quantitative and Qualitative Disclosures
About Market Risk and Information on the Company  Business Overview 
Regulation.

Critical Accounting Policies  Allowance for Loan Losses

Net income for 2001 declined $95 million compared to 2000, mostly due to
higher provisions to the allowance for loan losses. During 2001, the Bank
provisioned $77.1 million to the allowance for loan losses, which represented
an increase of $69 million compared to the allowance made for 2000. The
additional provision for loan losses was mostly related to the Banks exposure
in Argentina.

The Bank makes allowances for loan losses resulting from an impaired loan
by comparing the net present value of the expected cash flows from the loan
discounted at the effective interest rate of the loan and the carrying value of
the loan. The Bank also maintains a loan loss reserve which is estimated using
a provisioning matrix model and other factors. See Information on the Company
 Business Overview  Loan Portfolio  Allowance for Credit Losses. Although
the Bank believes that its allowance for loan losses (to be increased as
described under Risk Factors  Regional Economic Conditions) will be adequate
to cover all known losses in its credit portfolio and is in accordance with
U.S. generally accepted accounting principles, there can be no assurance that
the provisions made in 2001 and 2002 will be adequate to cover any further
increase in the amount of impaired loans or any further deterioration in its
impaired loan portfolio. The Bank stops accruing interest on a loan once it
has been identified as impaired. The Bank also reverses against earnings any
interest receivable accrued and unpaid on a loan at the time it is identified
as impaired.

Liquidity and Capital Resources

Liquidity

Liquidity refers to the Banks ability to maintain adequate cash flows to
fund operations and meet obligations and other commitments on a timely basis.
It is the opinion of the Banks management that the Banks working capital is
sufficient for the Banks present liquidity requirements. The Bank maintains
its liquid assets in demand deposits, overnight funds and time deposits with
well-known international banks. These liquid assets are adequate to cover
24-hour deposits from customers, which theoretically could be withdrawn on the
same day. The Banks 24-hour deposits from customers (overnight deposits,
demand deposit accounts and call deposits) generally total 3% of total
deposits. At December 31, 2001, 24-hour deposits amounted to $71.1 million.
Additionally, the Bank has approximately $76 million to $94 million of time
deposits maturing daily. The liquidity requirement resulting from these
maturities is met by the Banks liquid assets, which at December 31, 2001 were
$559 million, and by daily maturities of approximately $12 million to $26
million in the Banks loan portfolio.

At December 31, 2001, BLADEX had a total liquidity position of $559
million, which represented 9% of total assets. BLADEXs overall objective is
to have a minimum of 50% of its liquidity position represented by demand, call
accounts and time deposits with maturities of less than one week invested in
overnight deposits with the balance invested in (i) short-term time deposits
with maturities of up to six months, (ii) investment funds (see Information on
the Company  Business Overview  Investments) or (iii) negotiable money
market instruments, such as Euro certificates of deposit, commercial paper,
bankers acceptances and other liquid instruments with maturities of up to 180
days. These instruments must be of investment grade quality (carrying two of
the following ratings: A-1, P-1 or F-1 from Standard & Poors, Moodys or
Fitch, respectively) and must have a liquid secondary market. Interbank
deposits are with reputable international banks, considered by management to be
of high quality, located outside of the Region. These banks must have a
correspondent relationship with BLADEX and be approved by the Board of
Directors on an annual basis. The primary

38



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##### Table of Contents



objectives for the investment of
BLADEXs liquidity funds are security and convertibility and the secondary
objective is yield. In order to manage its liquidity needs and risks, BLADEXs
liquidity position is reviewed and monitored on a daily basis by management.

The average loan portfolio declined by $501 million in 1999 as compared to
1998, increased by $569 million in 2000 and decreased by $193 million in 2001.
The net decrease in cash flows due to deposits for the year ended December 31,
1999 was $88.8 million. The net increase in cash flows due to deposits for the
year
ended December 31, 2000 was $126.7 million. The net decrease in cash
flows due to deposits for the year ended December 31, 2001 was $172.5 million.
In 1999 and 2000, the Banks cash flow generated by short-term borrowings and
placements declined by $362.7 million and $11.1 million, respectively. In
2001, the Banks cash flow generated by short-term borrowings and placements
increased by $313.4 million. During 1999, the Banks cash flow generated by
medium and long-term borrowings and placements declined by $57.0 million, and
increased by $369.9 million and $204.7 million during 2000 and 2001,
respectively.

Deposits as a percentage of total liabilities decreased from 36% at
December 31, 1999 to 35% at December 31, 2000 and to 30% at December 31, 2001.
At December 31, 1999, 2000 and 2001, short-term and medium-term borrowings and
placements accounted for 61%, 63% and 68%, respectively, of total liabilities.
Short-term and medium-term borrowings and placements were important sources of
funding for the Banks loan portfolio because they permitted the Bank to
diversify its sources of funding outside of the Region, and because the Bank
utilized these borrowings and placements, which generally had longer maturities
than deposits, to help manage its asset and liability positions.

The Banks loan and investment portfolio is primarily short-term. At
December 31, 1999, 2000 and 2001, 80%, 63% and 61%, respectively, of the Banks
loan portfolio (loans plus selected investment securities held to maturity and
available for sale plus securities purchased under agreements to resell) had an
average term left to maturity of 365 days or less. While the Banks
liabilities generally mature over shorter periods than its assets, requiring
the Bank to renew or create new liabilities at current interest rates, the
associated risk is diminished by the short-term nature of the loan portfolio.
At December 31, 2001, $431 million of the loan portfolio (9% of the total)
matured within 30 days, $832 million (18% of total loan portfolio) matured
within 90 days, $987 million (21% of total loan portfolio) matured within 180
days and $737 million (16% of total loan portfolio) matured within one year.
At December 31, 2001, the average original term to maturity of the Banks
short-term loan portfolio was approximately 242 days.

Interest-Bearing Deposits in Other Banks

The following table shows short-term funds deposited with other banks by
principal geographic area at the dates indicated below.

|              |       |   |                 |       |      |   |       |       |  |   |       |       | 
|------------- | ----- | - | --------------- | ----- | ---- | - | ----- | ----- |  | - | ----- | ----- | 
|              |       |   | At December 31,
|              |       |   |                
|              |       |   | 1999            |       | 2000 |   | 2001 
|              |       |   |                 |       |      |   |      
|              |       |   | (in millions)  
|              |       |   |                
|Europe        |       | $ | 317.7           |       |      | $ | 249.2 |       |  | $ | 455.9 |      
|             
|             
|             
|             
|United States |       |   | 61.4            |       |      |   | 34.3  |       |  |   | 47.8  |      
|             
|             
|             
|             
|Other O.E.C.D |       |   | 27.3            |       |      |   | 30.0  |       |  |   | 550   |      
|              |       |   |                 |       |      |   |       |       |  |   |       |      
|              | TOTAL |   | $               | 406.4 |      |   | $     | 313.5 |  |   | $     | 558.7 | 
|              |       |   |                 |       |      |   |       |       |  |   |       |      

Funding Sources

The Banks principal sources of funds are deposits, borrowed funds and
floating and fixed rate placements. While these sources are expected to
continue to provide most of the funds needed by the Bank in the future, their
mix, as well as the possible use of other sources of funds, will depend upon
future economic and market conditions.

39



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##### Table of Contents



At December 31, 1999, 2000 and 2001, short-term and medium-term borrowings
and placements represented 61%, 63% and 68%, respectively, of total
liabilities. The Bank also relies mostly upon inter-bank deposits for funding,
which at December 31, 1999, 2000 and 2001 represented 36%, 35% and 30%,
respectively, of total liabilities.

Funds raised by the Bank are used primarily to provide trade-related loans
to its customers. In 1999, loans plus selected investments (which were bought
as part of the Banks credit portfolio activity) plus securities purchased
under agreements to resell decreased by $501 million. In 2000 and 2001, loans
plus selected investments held as part of the credit portfolio plus securities purchased
under agreements to resell increased by $569 million and $59 million,
respectively. A portion of the funds raised is used to maintain a certain
level of liquidity held in cash and due from banks and interest
bearing-deposits in other banks, which at December 31, 1999, 2000 and 2001
totaled $402 million, $314 million and $559 million, respectively.

The Bank obtains deposits principally from central and commercial banks in
the Region. Approximately 60% of the deposits held by the Bank are deposits
made by central banks of countries in the Region. Many of these banks deposit
a portion of their dollar reserves with the Bank. The average term remaining
to maturity of deposits from central banks of countries in the Region at
December 31, 2001 was 74 days as compared to 78 days at December 31, 2000. The
bulk of the Banks remaining deposits is obtained from commercial banks in the
Region. At December 31, 2001, deposits from the Banks five largest
depositors, all of which were central banks in the Region, constituted 40% of
the Banks total deposits.

Deposits

The principal components of the Banks customer deposits are demand and
time deposits. The following table analyzes the Banks deposits by country at
December 31 of each year set forth below:

|                   |  |   |                 |  |      |   |       |  |  |   |       |  | 
|------------------ |  | - | --------------- |  | ---- | - | ----- |  |  | - | ----- |  | 
|                   |  |   | At December 31,
|                   |  |   |                
|                   |  |   | 1999            |  | 2000 |   | 2001 
|                   |  |   |                 |  |      |   |      
|                   |  |   | (in millions)  
|                   |  |   |                
|Argentina          |  | $ | 91.5            |  |      | $ | 89.7  |  |  | $ | 112.0 | 
|                  
|                  
|                  
|                  
|Barbados           |  |   | 2.0             |  |      |   | 7.7   |  |  |   | 5.8   | 
|                  
|                  
|                  
|                  
|Bolivia            |  |   | 0.1             |  |      |   | 20.4  |  |  |   | 18.0  | 
|                  
|                  
|                  
|                  
|Brasil             |  |   | 217.8           |  |      |   | 281.2 |  |  |   | 317.7 | 
|                  
|                  
|                  
|                  
|Chile              |  |   | 0.4             |  |      |   | 0.4   |  |  |   | 0.0   | 
|                  
|                  
|                  
|                  
|Colombia           |  |   | 9.5             |  |      |   | 21.1  |  |  |   | 16.4  | 
|                  
|                  
|                  
|                  
|Costa Rica         |  |   | 117.9           |  |      |   | 55.1  |  |  |   | 51.8  | 
|                  
|                  
|                  
|                  
|Dominican Republic |  |   | 103.9           |  |      |   | 61.0  |  |  |   | 73.3  | 
|                  
|                  
|                  
|                  
|Ecuador            |  |   | 212.8           |  |      |   | 175.0 |  |  |   | 117.1 | 
|                  
|                  
|                  
|                  
|El Salvador        |  |   | 31.5            |  |      |   | 15.4  |  |  |   | 34.5  | 
|                  
|                  
|                  
|                  
|France             |  |   | 0.0             |  |      |   | 0.0   |  |  |   | 18.8  | 
|                  
|                  
|                  
|                  
|Germany            |  |   | 0.0             |  |      |   | 0.0   |  |  |   | 10.0  | 
|                  
|                  
|                  
|                  
|Guatemala          |  |   | 20.0            |  |      |   | 129.7 |  |  |   | 112.4 | 
|                  
|                  
|                  
|                  
|Haiti              |  |   | 1.0             |  |      |   | 1.5   |  |  |   | 2.0   | 
|                  
|                  
|                  
|                  
|Honduras           |  |   | 10.9            |  |      |   | 12.0  |  |  |   | 25.3  | 
|                  
|                  
|                  
|                  
|Japan              |  |   | 35.0            |  |      |   | 80.0  |  |  |   | 0.0   | 
|                  
|                  
|                  
|                  
|Jamaica            |  |   | 1.5             |  |      |   | 2.5   |  |  |   | 1.9   | 
|                  
|                  
|                  
|                  
|Mexico             |  |   | 195.0           |  |      |   | 198.5 |  |  |   | 246.3 | 
|                  
|                  
|                  
|                  
|The Netherlands    |  |   | 17.5            |  |      |   | 7.5   |  |  |   | 3.5   | 
|                  
|                  
|                  
|                  
|Nicaragua          |  |   | 25.9            |  |      |   | 0.2   |  |  |   | 0.4   | 
|                  
|                  
|                  
|                  
|Panama             |  |   | 216.7           |  |      |   | 287.3 |  |  |   | 146.2 | 
|                  
|                  
|                  
|                  
|Paraguay           |  |   | 0.0             |  |      |   | 0.0   |  |  |   | 2.3   | 
|                  
|                  
|                  
|                  
|Peru               |  |   | 205.0           |  |      |   | 167.9 |  |  |   | 6.3   | 

40



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##### Table of Contents



|                       |       |  |                 |         |      |  |      |         |  |  |       |         | 
|---------------------- | ----- |  | --------------- | ------- | ---- |  | ---- | ------- |  |  | ----- | ------- | 
|                       |       |  | At December 31,
|                       |       |  |                
|                       |       |  | 1999            |         | 2000 |  | 2001
|                       |       |  |                 |         |      |  |     
|                       |       |  | (in millions)  
|                       |       |  |                
|Spain                  |       |  | 38.0            |         |      |  | 40.0 |         |  |  | 30.0  |        
|                      
|                      
|                      
|                      
|Trinidad and Tobago    |       |  | 35.5            |         |      |  | 62.6 |         |  |  | 177.2 |        
|                      
|                      
|                      
|                      
|United States          |       |  | 0.0             |         |      |  | 0.0  |         |  |  | 0.7   |        
|                      
|                      
|                      
|                      
|Uruguay                |       |  | 0.0             |         |      |  | 0.0  |         |  |  | 15.0  |        
|                      
|                      
|                      
|                      
|Venezuela              |       |  | 24.5            |         |      |  | 23.9 |         |  |  | 23.3  |        
|                      
|                      
|                      
|                      
|Regional
Organizations |       |  | 3.2             |         |      |  | 3.2  |         |  |  | 3.2   |        
|                       |       |  |                 |         |      |  |      |         |  |  |       |        
|                       | TOTAL |  | $               | 1,617.1 |      |  | $    | 1,743.8 |  |  | $     | 1,571.4 | 
|                       |       |  |                 |         |      |  |      |         |  |  |       |        

Short-Term Borrowings & Placements

As of December 31, 2001, the Bank had short-term borrowings and placements
outstanding of $1,823 million. The Banks short-term borrowings consist of
borrowings from banks and borrowings through issuance of commercial paper and
certificates of deposit. The Banks short-terms borrowings from banks, which
totaled $1,735 million at December 31, 2001, have maturities of up to 365 days
and are made available to the Bank on an uncommitted basis for the financing of
trade-related loans. These short-term borrowings are provided by approximately
80 European and North and Latin American banks. Commercial paper and
certificate of deposit issuances, which totaled $73 million at December 31,
2001, are made under the Banks Euro-Commercial Paper and Certificate of
Deposit Program. The maximum amount of notes and certificates of deposit
authorized to be issued under this program is $750 million and the maximum term
of the notes and certificates of deposit issued thereunder is 365 days. Notes
issued at a discount and interest bearing certificates of deposit may both be
issued under this program in various hard currencies.

The short-term debt securities placements include floating and fixed rate
notes with maturities of up to 365 days issued under the Banks EMTN Program
(as defined below). The maximum amount of notes authorized to be issued under
this program is $2.25 billion. See   Medium and Long-Term Floating and Fixed
Rate Placements.

The average original term remaining to maturity of the short-term
borrowings and placements at December 31, 2001 was approximately 204 days. At
December 31, 2001, 34% of all short-term borrowings and placements were due
within 30 days, 25% were due within 31-90 days, 24% were due within 91-180 days
and the balance were due prior to the end of the year 2002. The Banks
short-term borrowings and placements provided matched funding for 34% of the
Banks total loan portfolio (loans plus selected investments plus securities
purchased under agreements to resell), and played an important role in
controlling the gap between assets and liabilities and in helping to minimize
the impact of short-term interest rate fluctuations. See   Liquidity. The
following table presents information regarding the amounts outstanding under,
and interest rates on, the Banks short-term borrowings and placements at the
dates and during the periods indicated.

|                                                                 |  |                                        |       |      |  |      |       |   |  |   |       |  
|---------------------------------------------------------------- |  | -------------------------------------- | ----- | ---- |  | ---- | ----- | - |  | - | ----- | -
|                                                                 |  | At and for the Year Ended December 31,
|                                                                 |  |                                       
|                                                                 |  | 1999                                   |       | 2000 |  | 2001
|                                                                 |  |                                        |       |      |  |     
|                                                                 |  | (in millions, except percentages)     
|                                                                 |  |                                       
|Maximum amount outstanding at any month end                      |  | $                                      | 1,878 |      |  | $    | 1,510 |   |  | $ | 1,880 |  
|                                                                
|                                                                
|                                                                
|                                                                
|Amount outstanding at year end                                   |  |                                        | 1,521 |      |  |      | 1,510 |   |  |   | 1,823 |  
|                                                                
|                                                                
|                                                                
|                                                                
|Average amount outstanding                                       |  |                                        | 1,718 |      |  |      | 1,258 |   |  |   | 1,704 |  
|                                                                
|                                                                
|                                                                
|                                                                
|Weighted average interest rate on average
amount outstanding     |  |                                        | 5.77  | %    |  |      | 6.82  | % |  |   | 5.17  | %
|                                                                
|                                                                
|                                                                
|                                                                
|Weighted average interest rate on amount
Outstanding at year end |  |                                        | 6.39  | %    |  |      | 6.95  | % |  |   | 3.25  | %

41



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##### Table of Contents



Medium and Long-Term Debt

The Bank, at December 31, 2001, had $1,108 million of syndicated and other
medium-term borrowings from various international banks. The interest rates on
most medium and long-term borrowings are adjusted semi-annually using the
six-month LIBOR plus a credit spread. The Bank uses these funds to finance its
medium-term loan portfolio. The average original term remaining to maturity of
the Banks medium and long-term debt is 2.5 years.

Medium and Long-Term Floating and Fixed Rate Placements

The Bank has a Euro Medium Term Note Program (the EMTN Program) which
has a maximum limit of $2.25 billion. Notes issued under the EMTN Program are
placed in Asia, Europe and North America, in either the Eurodollar or 144A
markets, and are general obligations of the Bank. The EMTN Program may be used
to issue notes with maturities ranging from 90 days up to a maximum of 30
years, at fixed or floating interest rates and in various hard currencies. The
sale of notes issued under the EMTN Program is generally made through one or
more authorized financial institutions. As of December 31, 2001, the total
amount outstanding under this program with medium-term maturities was $679
million, of which $396 million was at floating interest rates and $283 million
at fixed interest rates. As part of its interest rate and currency risk
management, the Bank enters into foreign exchange forward and cross currency
contracts and interest rate swaps to hedge the risk associated with a portion
of the notes issued under its EMTN Program. See Quantitative and Qualitative
Disclosure About Market Risk.

The interest rate on all currently outstanding floating rate notes issued
under the EMTN Program is adjusted quarterly or semi-annually using the
applicable LIBOR rate. The weighted average interest cost of these placements
at the end of 2001 was 3.16%, and the placements had final maturities in 2002
through 2006.

As of December 31, 2001, the Bank had fixed rate placements outstanding of
$283 million under the EMTN Program with maturities in 2002 through 2005. The
weighted average interest cost of these fixed rate placements at the end of
2001 was 5.73%.

Cost and Maturity Profile of Borrowed Funds and Floating and Fixed Rate
Placements

The following table sets forth certain information regarding the weighted
average cost and the remaining maturities of the Banks borrowed funds and
floating and fixed rate placements at December 31, 2001.

|                                         |                          |       |   |               |         |              |  |          |      |  
|---------------------------------------- | ------------------------ | ----- | - | ------------- | ------- | ------------ |  | -------- | ---- | -
|                                         |                          |       |   |               |         |              |  | Weighted
|                                         |                          |       |   | Amount        |         | Average Cost
|                                         |                          |       |   |               |         |             
|                                         |                          |       |   | (in millions) |         |              |  |         
|                                         |                          |       |   |               |         |              |  |         
|Short-Term Borrowings & Placements       |                          |       |   |               |         |              |  |         
|                                        
|                                        
|                                        
|                                        
|                                         | Due in 0 to 30 days      |       | $ | 617.1         |         |              |  | 3.10     | %   
|                                        
|                                        
|                                        
|                                        
|                                         | Due in 31 to 90 days     |       |   | 447.8         |         |              |  | 3.71     | %   
|                                        
|                                        
|                                        
|                                        
|                                         | Due in 91 to 180 days    |       |   | 446.3         |         |              |  | 2.99     | %   
|                                        
|                                        
|                                        
|                                        
|                                         | Due in 181 to 365 days   |       |   | 312.1         |         |              |  | 3.23     | %   
|                                         |                          |       |   |               |         |              |  |         
|                                         |                          | Total |   | $             | 1,823.3 |              |  |          | 3.25 | %
|                                        
|                                        
|                                        
|                                        
|Medium and Long-Term Borrowings          |                          |       |   |               |         |              |  |         
|                                        
|                                        
|                                        
|                                        
|                                         | Due in 0 to 30 days      |       | $ | 5.0           |         |              |  | 2.60     | %   
|                                        
|                                        
|                                        
|                                        
|                                         | Due in 31 to 90 days     |       |   | 51.0          |         |              |  | 3.90     | %   
|                                        
|                                        
|                                        
|                                        
|                                         | Due in 91 to 180 days    |       |   | 150.5         |         |              |  | 2.72     | %   
|                                        
|                                        
|                                        
|                                        
|                                         | Due in 181 to 365 days   |       |   | 162.7         |         |              |  | 3.36     | %   
|                                        
|                                        
|                                        
|                                        
|                                         | Due in 1 through 5 years |       |   | 739.0         |         |              |  | 3.51     | %   
|                                         |                          |       |   |               |         |              |  |         
|                                         |                          | Total |   | $             | 1,108.2 |              |  |          | 3.40 | %
|                                        
|                                        
|                                        
|                                        
|Medium & Long-Term Fixed Rate Placements |                          |       |   |               |         |              |  |         
|                                        
|                                        
|                                        
|                                        
|                                         | Due in 91 to 180 days    |       |   | 91.2          |         |              |  | 6.85     | %   
|                                        
|                                        
|                                        
|                                        
|                                         | Due in 181 to 365 days   |       |   | 91.0          |         |              |  | 6.43     | %   

42



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##### Table of Contents



|                                            |                          |       |  |               |       |              |  |          |      |  
|------------------------------------------- | ------------------------ | ----- |  | ------------- | ----- | ------------ |  | -------- | ---- | -
|                                            |                          |       |  |               |       |              |  | Weighted
|                                            |                          |       |  | Amount        |       | Average Cost
|                                            |                          |       |  |               |       |             
|                                            |                          |       |  | (in millions) |       |              |  |         
|                                            |                          |       |  |               |       |              |  |         
|                                            | Due in 1 through 5 years |       |  | 101.2         |       |              |  | 6.49     | %   
|                                            |                          |       |  |               |       |              |  |         
|                                            |                          | Total |  | $             | 283.0 |              |  |          | 6.63 | %
|                                           
|                                           
|                                           
|                                           
|Medium & Long-Term Floating Rate Placements |                          |       |  |               |       |              |  |         
|                                           
|                                           
|                                           
|                                           
|                                            | Due in 91 to 180 days    |       |  | 37.3          |       |              |  | 2.81     | %   
|                                           
|                                           
|                                           
|                                           
|                                            | Due in 181 to 365 days   |       |  | 110.8         |       |              |  | 2.89     | %   
|                                           
|                                           
|                                           
|                                           
|                                            | Due in 1 through 5 years |       |  | 247.4         |       |              |  | 3.07     | %   
|                                            |                          |       |  |               |       |              |  |         
|                                            |                          | Total |  | $             | 395.5 |              |  |          | 2.92 | %

At December 31, 2001, the Bank had no material commitments for capital
expenditures.

Contractual Obligations and Commercial Commitments

The following tables set forth information regarding the Banks
contractual obligations and commercial commitments as of December 31, 2001.

|                        |                                    |       |                        |                  |  |             |       |             |  |   |       |       |  |   |    |    | 
|----------------------- | ---------------------------------- | ----- | ---------------------- | ---------------- |  | ----------- | ----- | ----------- |  | - | ----- | ----- |  | - | -- | -- | 
|                        |                                    |       | Payments Due by Period
|                        |                                    |       |                       
|Contractual Obligations |                                    | Total |                        | Less than 1 year |  | 1  3 years |       | 4  5 years
|                        |                                    |       |                        |                  |  |             |       |            
|                        |                                    |       | (in millions)         
|                        |                                    |       |                       
|Long-term debt          |                                    | $     | 1,787                  |                  |  | $           | 671   |             |  | $ | 1,045 |       |  | $ | 71 |   
|                       
|                       
|                       
|                       
|Short-term debt         |                                    |       | 1,823                  |                  |  |             | 1,823 |             |  |   |      |       |  |   |   |   
|                        |                                    |       |                        |                  |  |             |       |             |  |   |       |       |  |   |    |   
|                        | Total contractual
cash obligations |       | $                      | 3,610            |  |             | $     | 2,494       |  |   | $     | 1,045 |  |   | $  | 71 | 
|                        |                                    |       |                        |                  |  |             |       |             |  |   |       |       |  |   |    |   

|                             |                              |               |                                            |                  |  |             |     |             |  |   |     |     |  |   |    |    | 
|---------------------------- | ---------------------------- | ------------- | ------------------------------------------ | ---------------- |  | ----------- | --- | ----------- |  | - | --- | --- |  | - | -- | -- | 
|                             |                              |               | Amount of Commitment Expiration Per Period
|                             |                              |               |                                           
|Other Commercial             |                              | Total Amounts |                                            |                  |  |             |     |             |  |   |     |     |  |  
|Commitments                  |                              | Committed     |                                            | Less than 1 year |  | 1  3 years |     | 4  5 years
|                             |                              |               |                                            |                  |  |             |     |            
|                             |                              |               | (in millions)                             
|                             |                              |               |                                           
|Lines of credit              |                              | $             | 85                                         |                  |  | $           | 85  |             |  | $ |    |     |  | $ |   |   
|                            
|                            
|                            
|                            
|Standby letters of credit    |                              |               | 194                                        |                  |  |             | 185 |             |  |   | 9   |     |  |   |   |   
|                            
|                            
|                            
|                            
|Guarantees                   |                              |               | 600                                        |                  |  |             | 352 |             |  |   | 248 |     |  |   |   |   
|                            
|                            
|                            
|                            
|Other commercial
commitments |                              |               | 31                                         |                  |  |             | 2   |             |  |   | 4   |     |  |   | 25 |   
|                             |                              |               |                                            |                  |  |             |     |             |  |   |     |     |  |   |    |   
|                             | Total Commercial
Commitments |               | $                                          | 910              |  |             | $   | 624         |  |   | $   | 261 |  |   | $  | 25 | 
|                             |                              |               |                                            |                  |  |             |     |             |  |   |     |     |  |   |    |   

Asset/Liability Management

The Bank seeks to manage its assets and liabilities to reduce the
potential adverse impact on net interest income that might result from changes
in interest rates. Risk control on interest rates is conducted through
systematic monitoring of maturity mis-matches. The Banks investment
decision-making takes into account not only the rates of return and their
underlying degree of risk, but also liquidity requirements, including minimum
cash reserves, withdrawal and maturity of deposits and additional demand for
funds. For any given period, a matched pricing structure exists when an equal
amount of assets and liabilities are repriced. An excess of assets or
liabilities over these matched items results in a gap or mis-match, as shown in
the table under Interest Rate Sensitivity below. A negative gap denotes
liability sensitivity and normally means that a decline in interest rates would
have a positive effect on net interest income, while an increase in interest
rates would have a negative effect on net interest income. Substantially all
of the Banks assets and liabilities are denominated in dollars and, therefore,
the Bank has no material foreign exchange risk.

43



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##### Table of Contents



In 1996, the Bank established an Asset  Liability Management Committee
(ALCO) with the purpose of monitoring and managing the interest rate gap of
the Bank and coordinating lending and funding activities to optimize profits
and reduce interest rate risk.

Interest Rate Sensitivity

The following table presents the projected maturities and interest rate
adjustment periods of the Banks assets, liabilities and common stockholders
equity based upon the contractual maturities and adjustment dates at December 31, 2001. The interest-earning assets and interest-bearing
liabilities of the Bank and the related interest rate sensitivity gap given in
the following table may not be reflective of positions in subsequent periods.

|                                                                              |  |                                   |         |           |  |            |         |             |  |      |         |          |  |           |         |   |  |         |       |           |  |              |       |   |  |   |        |  
|----------------------------------------------------------------------------- |  | --------------------------------- | ------- | --------- |  | ---------- | ------- | ----------- |  | ---- | ------- | -------- |  | --------- | ------- | - |  | ------- | ----- | --------- |  | ------------ | ----- | - |  | - | ------ | -
|                                                                              |  |                                   |         |           |  |            |         |             |  |      |         |          |  |           |         |   |  | 181-365 |       | More than |  | Non-Interest
|                                                                              |  | Total                             |         | 0-30 Days |  | 31-90 Days |         | 91-180 Days |  | Days |         | 365 Days |  | Sensitive
|                                                                              |  |                                   |         |           |  |            |         |             |  |      |         |          |  |          
|                                                                              |  | (in millions, except percentages)
|Interest-earning assets
Cash and due from banks                               |  | $                                 | 2.0     |           |  | $          | 2.0     |             |  | $    |        |          |  | $         |        |   |  | $       |      |           |  | $            |      |   |  | $ |       |  
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Interest-bearing deposits with
banks                                          |  |                                   | 556.7   |           |  |            | 526.7   |             |  |      | 30.0    |          |  |           |        |   |  |         |      |           |  |              |      |   |  |   |       |  
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Securities purchased under
agreement to resell                                |  |                                   | 291.9   |           |  |            | 291.9   |             |  |      |        |          |  |           |        |   |  |         |      |           |  |              |      |   |  |   |       |  
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Investment securities                                                         |  |                                   | 362.1   |           |  |            | 54.2    |             |  |      | 151.4   |          |  |           | 170.4   |   |  |         | 5.8   |           |  |              | 15.0  |   |  |   | (34.7  | )
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Loans, net                                                                    |  |                                   | 4,536.1 |           |  |            | 1,105.1 |             |  |      | 1,579.6 |          |  |           | 1,466.2 |   |  |         | 440.0 |           |  |              | 142.9 |   |  |   | (197.7 | )
|                                                                              |  |                                   |         |           |  |            |         |             |  |      |         |          |  |           |         |   |  |         |       |           |  |              |       |   |  |   |        |  
|Total Interest-earning assets                                                 |  |                                   | 5,748.8 |           |  |            | 1,979.9 |             |  |      | 1,761.0 |          |  |           | 1,636.6 |   |  |         | 445.8 |           |  |              | 157.9 |   |  |   | (232.4 | )
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Non-interest earning assets                                                   |  |                                   | 111.8   |           |  |            |        |             |  |      |        |          |  |           |        |   |  |         |      |           |  |              |      |   |  |   | 111.8  |  
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Other assets                                                                  |  |                                   | 64.8    |           |  |            |        |             |  |      |        |          |  |           |        |   |  |         |      |           |  |              |      |   |  |   | 64.8   |  
|                                                                              |  |                                   |         |           |  |            |         |             |  |      |         |          |  |           |         |   |  |         |       |           |  |              |       |   |  |   |        |  
|Total assets                                                                  |  | $                                 | 5,925.4 |           |  | $          | 1,979.9 |             |  | $    | 1,761.0 |          |  | $         | 1,636.6 |   |  | $       | 445.8 |           |  | $            | 157.9 |   |  | $ | (55.8  | )
|                                                                              |  |                                   |         |           |  |            |         |             |  |      |         |          |  |           |         |   |  |         |       |           |  |              |       |   |  |   |        |  
|Interest-bearing liabilitiesDepositsDemand                                    |  |                                   | 71.1    |           |  |            | 71.1    |             |  |      |        |          |  |           |        |   |  |         |      |           |  |              |      |   |  |   |       |  
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Time                                                                          |  |                                   | 1,500.3 |           |  |            | 1,057.5 |             |  |      | 372.4   |          |  |           | 62.8    |   |  |         | 7.5   |           |  |              |      |   |  |   |       |  
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Short-term borrowings & placements                                            |  |                                   | 1,823.3 |           |  |            | 632.3   |             |  |      | 447.8   |          |  |           | 431.1   |   |  |         | 312.1 |           |  |              |      |   |  |   |       |  
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Medium and long-term borrowings &
placements                                  |  |                                   | 1,787.2 |           |  |            | 337.0   |             |  |      | 666.3   |          |  |           | 771.3   |   |  |         | 12.6  |           |  |              |      |   |  |   |       |  
|                                                                              |  |                                   |         |           |  |            |         |             |  |      |         |          |  |           |         |   |  |         |       |           |  |              |       |   |  |   |        |  
|Total Interest-bearing liabilities                                            |  |                                   | 5,181.9 |           |  |            | 2,097.9 |             |  |      | 1,486.5 |          |  |           | 1,265.2 |   |  |         | 332.2 |           |  |              | 0     |   |  |   | 0      |  
|                                                                              |  |                                   |         |           |  |            |         |             |  |      |         |          |  |           |         |   |  |         |       |           |  |              |       |   |  |   |        |  
|Non-interest bearing liabilities                                              |  |                                   | 129.9   |           |  |            |        |             |  |      |        |          |  |           |        |   |  |         |      |           |  |              |      |   |  |   | 129.9  |  
|                                                                              |  |                                   |         |           |  |            |         |             |  |      |         |          |  |           |         |   |  |         |       |           |  |              |       |   |  |   |        |  
|Total Liabilities                                                             |  |                                   | 5,311.8 |           |  |            | 2,097.9 |             |  |      | 1,486.5 |          |  |           | 1,265.2 |   |  |         | 332.2 |           |  |              |      |   |  |   | 129.9  |  
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Redeemable Preferred Stock                                                    |  |                                   | 15.2    |           |  |            |        |             |  |      |        |          |  |           |        |   |  |         |      |           |  |              |      |   |  |   | 15.2   |  
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Common Stockholders Equity                                                   |  |                                   | 598.4   |           |  |            |        |             |  |      |        |          |  |           |        |   |  |         |      |           |  |              |      |   |  |   | 598.4  |  
|                                                                              |  |                                   |         |           |  |            |         |             |  |      |         |          |  |           |         |   |  |         |       |           |  |              |       |   |  |   |        |  
|Total Liabilities, Redeemable
Preferred Stock and Common
Stockholders Equity |  | $                                 | 5,925.4 |           |  | $          | 2,097.9 |             |  | $    | 1,486.5 |          |  | $         | 1,265.2 |   |  | $       | 332.2 |           |  | $            | 0     |   |  | $ | 743.5  |  
|                                                                              |  |                                   |         |           |  |            |         |             |  |      |         |          |  |           |         |   |  |         |       |           |  |              |       |   |  |   |        |  
|Interest rate sensitivity gap                                                 |  |                                   |        |           |  | $          | (118.0  | )           |  | $    | 274.5   |          |  | $         | 371.4   |   |  | $       | 113.6 |           |  | $            | 157.9 |   |  | $ | (799.4 | )
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Cumulative interest rate
sensitivity gap                                      |  |                                   |        |           |  | $          | (118.0  | )           |  | $    | 156.5   |          |  | $         | 527.9   |   |  | $       | 641.5 |           |  | $            | 799.4 |   |  |   |       |  
|                                                                             
|                                                                             
|                                                                             
|                                                                             
|Cumulative gap as a % of total
interest-earning assets                        |  |                                   |        |           |  |            | -2.05   | %           |  |      | 2.72    | %        |  |           | 9.18    | % |  |         | 11.2  | %         |  |              | 13.91 | % |  |   |       |  

The Banks interest rate risk arises from the Banks liability sensitive
position in the short-term, which means that the Banks interest-bearing
liabilities reprice more quickly than the Banks interest-earning assets.
Consequently, there is a potential adverse impact on the Banks net interest
income that might result from changes in interest rates. The Banks interest
rate risk is managed by attempting to match the term and repricing
characteristics of the Banks interest rate sensitive assets and liabilities.
The Banks policy with respect to interest rate gaps provides that the gap
between short-term interest-earning assets and interest-bearing liabilities on
a cumulative basis at 90 days cannot exceed 200% of the Banks total capital.
On a cumulative basis at 180 days, the gap cannot exceed 100% of the Banks
total capital. The Banks policy with respect to interest rate gaps also
provides that the Bank is to match fund interest-earning assets over 365 days,
as discussed above. The Bank also uses interest rate swaps on a limited basis
as part of its interest rate risk management. These interest rate swaps are
made either in a single currency or cross-currency for a prescribed period to
exchange a series of interest rate flows, which involve fixed for floating rate
interest payments.

44



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##### Table of Contents



Foreign Exchange Sensitivity

The Bank accepts deposits and raises funds principally in United States
dollars, and makes loans mostly in United States dollars. At December 31,
2001, the Banks total non-dollar financial liabilities constituted 1.95% of
total liabilities and consisted exclusively of hard currencies. The Banks
total non-dollar loans and investments constituted 2.9% of total assets and
consisted mostly of Yen-denominated loans. The Banks currency risk results
from the potential impact of changes in exchange rates on foreign currency
exposures. The Bank manages this
risk by not holding open foreign exchange positions. The Bank uses
foreign exchange forward contracts as part of its management of currency risks.
Most of the Banks forward exchange contracts are made by the Bank as end-user
to hedge foreign exchange risks arising from the issuance of non-dollar
denominated short-term Euro commercial paper and medium and long-term Euro
medium-term notes, and from making non-dollar denominated short and medium-term
loans. The Bank also engages in some foreign exchange trades to serve
customers trade transaction needs, and all positions are hedged with an
offsetting contract in the same currency. The Bank manages the risks on these
buy and sell foreign currency contracts by establishing limits relating to the
amounts and terms of these instruments for each counterparty, and by having
adopted policies that do not allow the Bank to maintain open positions. For
quantitative information on derivative financial instruments relating to the
Banks foreign exchange market risk, see Note 17 of the Notes to Consolidated
Financial Statements, and for further information on foreign exchange risk, see
Note 2(j) of the Notes to the Consolidated Financial Statements. Also, see
Quantitative and Qualitative Disclosure About Market Risk.

Trend Information

During the first five months of 2002, the Bank continued to operate under
difficult operating conditions in the Latin American region and a weak global
economy. The deterioration of the Argentine economy, reflecting four years of
economic recession, and the current crises, have adversely affected the
financial condition of the Banks Argentine obligors, including banks and
corporations, and the quality of the Banks loans to those obligors. In
response, the Bank has put in place a pragmatic collection program to manage
its Argentine exposure. The Banks multilateral status, confirmed by the
Central Bank of Argentina at the end of February 2002, exempts the Bank from
limitations on the convertibility and transfer abroad of U.S. dollars for
payment of external obligations, thereby contributing to the on-going efforts
of this program.

As a result, the Banks exposure to Argentina at June 21, 2002 amounted to
approximately $920 million, which represented a reduction of $198 million from
December 31, 2001 and a reduction of $40 million from March 31, 2002. All of
the Banks exposure in Argentina continues to be denominated in U.S. dollars
(with a small portion in Japanese yen) as none of the Banks loans in Argentina
have been converted to an Argentine peso basis. During the year 2002, the Bank collected interest from Argentine borrowers
of approximately $27 million while interest in the amount of $2.7 million on
non-accruing and accruing assets remained unpaid at June 21, 2002. The Bank intends to place all
loans and investments in Argentina on non-accrual status at June 30, 2002. Fees
generated by contingencies in Argentina will also be accounted for on a cash
basis.

Even with the benefit of the Banks confirmed multilateral status, given
the continued severity of the Argentine crises, the Bank believes that it will
have to renegotiate and restructure loans, and that it will also face
write-offs in its Argentine portfolio. In the absence of any clarity about the
timing or nature of resolving the many issues facing the country, the Banks
management and Board of Directors have determined to take a conservative
position relative to the Banks credit portfolio in Argentina.

At December 31, 2001, the Bank had a total allowance for credit losses
(including loans and contingencies) of $195 million, reflecting additional provisions
taken in 2001 of $77 million. In addition, the Bank charged $40 million to
earnings in 2001 for impairment losses on securities from Argentina.

After careful consideration, and based upon rigorous analysis of all the
relevant factors, the Banks Board of Directors has determined to further
increase the allowance for credit losses and impairment losses on securities

45



---



##### Table of Contents



to
approximately $510 million, of which approximately $420 million will relate to
its Argentine portfolio. The exact amount of this increase, and the
corresponding charge against earnings, will be determined prior to and
announced in connection with the release of the Banks second quarter results
scheduled for late July or early August 2002.

As part of this decision, the Bank is formulating a comprehensive
strategy, with the assistance of financial advisors, designed to address the
Banks capital and funding needs following the contemplated increase of the
credit loss allowance for Argentina. This strategy will include a plan to
recapitalize the Bank with additional equity capital. The Bank has retained BNP Paribas Securities Corp. and
Deutsche Bank Securities Inc. as financial advisors to assist with this
process. The Bank and its advisors are coordinating with the Banks credit
rating agencies, multilateral organizations and public sector shareholders, in
formulating this recapitalization plan.

The Bank believes that these steps will adequately address the likely
impact of the Argentine situation on the Banks loan portfolio and that the
Bank will remain in a strong financial position. There can be no assurance,
however, that the Bank will be successful in executing any recapitalization
plan or that the political and economic situation in Argentina will not
deteriorate further and require additional action.

The Bank will continue to monitor developments in Argentina closely and
take the appropriate additional steps as more information and clarity on the
Argentine governments actions regarding external debt and their effect on the
Bank become available.

The crisis in Argentina and downgrades by the rating agencies have
affected the Banks funding activity. Deposits declined 52% during the first
five months of 2002 and the international debt markets were closed for medium
term placements. This factor combined with weak loan demand resulted in a 30%
decline in the credit portfolio during this period. During the first quarter
of 2002, the major rating agencies downgraded the Banks credit rating due to
the crisis in Argentina and its potential impact on the Banks credit exposure
in that country.

The Bank follows a conservative liquidity management strategy and in view
of the volatility in the Region began gradually increasing its net cash position in
the second quarter of 2001, reaching a level of approximately $600 million in
January 2002, which has been maintained since that time. At May 31, 2002,
liquidity levels amounted to $592 million compared to $314 million at December
31, 2000. At May 31, 2002, the Banks net cash position represented almost 80%
of total deposits. There is no assurance that a further deterioration of the
Argentine situation or difficulties in other countries in the Region where the
Bank has large exposures will not trigger further downgrades in the Banks
credit ratings below investment grade ratings, which would adversely affect the
Banks cost of funds, its deposit base and accessibility to the debt capital
markets.

A lower interest rate environment during the first five months of 2002
generated a lower return on the Banks available capital funds invested in
liquid assets. Because returns on funds invested in liquid assets impact net
income (see   Operating Results  Net Interest Income), a continued trend of
lower interest rates in the markets in which the Bank invests its funds would
adversely affect the Banks net income in the future.




Item 6. Directors, Senior Management and Employees

Directors and Senior Management

Directors

The following table ses forth certain information concerning the Directors
of the Bank as of the date of this Annual Report, including information with
respect to each persons current position with the Bank and with other
institutions, country of citizenship and the year that each Directors term
expires.

46



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##### Table of Contents



|                                                                                         |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|---------------------------------------------------------------------------------------- |  | ----------- | ------- | -------- |  | ------------- | ------ | ----------------- | ---- |  | ---- |  | ---- |  |  | 
|                                                                                         |  |             |         |          |  | Position Held |        |                   |      |  |      |  |      | 
|                                                                                         |  | Country of  |         | With the |  | First Year as |        |                   |      | 
|Name                                                                                     |  | Citizenship |         | Bank     |  | Director      |        | Year Term Expires
|                                                                                         |  |             |         |          |  |               |        |                  
|                                                                                         |  |             |         |          |  |              
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|CLASS A                                                                                  |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                         |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|Rubens Amaral
Managing Director and General Manager,
Banco de Brasil, New York           |  | Brazil      |         | Director |  |               | 2000   |                   |      |  | 2004 | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                         |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|Guillermo Güémez García
Deputy Governor,
Banco de Mexico, Mexico                         |  | Mexico      |         | Director |  |               | 1997   |                   |      |  | 2005 | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                         |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|Miguel Gómez M
President
Banco de Comercio Exterior S.A                                  |  | Colombia    |         | Director |  |               | 2002   |                   |      |  | 2005 | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                         |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|CLASS B                                                                                  |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                         |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|Ernesto Bruggia
General Manager,
Banco de la Provincia de Buenos Aires,
Argentina        |  | Argentina   |         | Director |  |               | 1996   |                   |      |  | 2005 | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                         |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|Valentín E. Hernández
Financial Institutions Division
Executive
Citibank, N.A., New York |  | Venezuela   |         | Director |  |               | 1998   |                   |      |  | 2005 | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                         |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|CLASS E                                                                                  |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                         |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|Will C. Wood
Principal
Kentwood Associates, California                                   |  |             | U. S. A |          |  | Director      |        |                   | 1999 |  |      |  | 2003 | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                         |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|Sebastiao Toledo Cunha
Managing Director, International Area
Banco Santos S.A., New York |  | Brazil      |         | Director |  |               | 1995*  |                   |      |  | 2004 | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                         |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|Mario Covo
Chief Executive Officer,
Fin@ccess International, Inc., New York              |  | Mexico      |         | Director |  |               | 1999   |                   |      |  | 2005 | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                         |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|ALL CLASSES OF COMMON STOCK                                                              |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                         |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|José Castañeda
Chief Executive Officer,
BLADEX, Panama                                   |  | Peru        |         | Director |  |               | 2000   |                   |      |  | 2003 | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                         |  |             |         |          |  |               |        |                   |      |  |      |  |      |  |  | 
|                                                                                        
|                                                                                        
|                                                                                        
|                                                                                        
|Gonzalo Menéndez Duque
Director
Banco de Chile, Chile                                    |  | Chile       |         | Director |  |               | 1990** |                   |      |  | 2003 | 



|*  |  | Class B Director from 1995 to 2001; elected Class E Director in April of
2001.                                                                                                     
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|** |  | Class B Director from 1990 to 2000; elected as a Director to represent
all classes of common stock in April of 2000.
In April 2002, was elected Chairman of the Board of Directors.

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Rubens Amaral has served as Managing Director and General Manager for
North America of Banco do Brasil, New York Branch since 2000. Mr. Amaral has
been employed by Banco do Brasil in various capacities since 1975, holding the
positions of Managing Director, International Division and alternate member of
the board of directors in 1998, Executive General Manager of the International
Division in Sao Paulo from 1994 to 1998, Deputy General Manager in the New York
branch in charge of the Trade Finance & Correspondent Banking
Department, 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 Division  Head Office, from 1989 to 1993. Mr. Amaral
also served as a representative for the Central Bank of Brazil from 1982 to
1988 in banking supervision.

Guillermo Güémez García has served as Deputy Governor of Banco de Mexico
since 1995 and served as Vice Chairman and President of the Executive Committee
in Grupo Azucarero Mexico of Grupo de Embotelladoras Unidas, S. A. de C. V.
from 1993 to 1994. He served on the Mexican Business Coordinating Council for
Nafta in the capacity of Executive Director from 1991 to 1993. He was employed
by Banco Nacional de Mexico in various capacities from 1974 to 1990, including
holding the position of Executive Vice President for International Products
from 1986 to 1990. Mr. Güémez García was the founder and served as President
of Euromex Casa de Cambio and Euroamerican Capital Corporation from 1986 to
1990. He has held the positions of Executive Vice President of International
Treasury and Foreign Exchange, Exchange Controls and Ficorca from 1982 to 1986,
as well as International Operations from 1984 for Banco Nacional de Mexico. He
was a representative in London and set up the Banco Nacional de Mexicos branch
in London from 1979 to 1981 and was the Manager for Foreign Currency Funding
and International Credits from 1974 to 1978. Mr. Güémez García was employed by
the Bank of America in Mexico, as an Assistant Representative in 1973 and from
1964 to 1972 he worked in the construction and cement industry.

Miguel Gómez M., since 1998, has served as President of Banco de Comercio
Exterior de Colombia, S. A. Bancoldex. From 1997 to 1998, Mr. Gómez served as
Executive President of the Colombian Association of Flower Exporters 
Asocolflores and as President of Verdesarrollo S. A. (Economical Adviser) from
1996 to 1997. He was employed by Controloría General de la Republica as the
Vice-Comptroller of the Republic from 1994 to 1996. Mr. Gómez was Dean of the
Faculty of Economy at the Universidad del Rosariofrom 1993 to 1994 and was the
Economics Advisor of the Minister, General Director for the Development of the
Interchange and Secretary of the Superior Counsel of Foreign Commerce for the
Ministry of Foreign Commerce from 1992 to 1993. He has also served as
Economical Manager and International Manager of the Colombian Association of
Flower Exporters -Asocolflores-, Economical Manager and International Manager
from 1990 to 1992, General Secretary and Presidents Assistant of Computec S.
A., from 1988 to 1990 and as Director of the International Section and Editor
of Sintesis Economica from 1986 to 1987.

Ernesto Bruggia has served as General Manager of Banco de la Provincia de
Buenos Aires (BPBA) since 1999 and as General Manager of Grupo BAPRO (holding
company of BPBA), since November 1998. Mr. Bruggia has been employed by BPBA
in various capacities since 1976, including; as Assistant General Manager from
1993 to 1999, as Finance Manager and International Relations from 1992 to 1993,
as International Operations Manager from 1990 to 1992, as Deputy Manager in
charge of International Operations from 1989 to 1990, as Deputy Manager in
charge of the International Division in 1985 and as Chief of International
Audit in 1983. Mr. Bruggia began his career with Banco de la Provincia de
Buenos Aires in 1976 in its Stock Exchange Department.

Valentín Hernández, since 1992, has served as Financial Institutions
Division Executive for Latin America, Central and Eastern Europe, the Middle
East, Africa, and the Indian sub-continent at Citibank, N.A., New York. Mr.
Hernández has been employed by Citibank, N.A. in various capacities since 1976,
including serving as Department Head for marketing and operations for
Sub-Sahara Africa and the Middle East in New York, from 1984 to 1992. He
handled marketing responsibilities for India, Australia, and Sub-Sahara Africa
from 1982 to 1984 and served as Relationship Manager in the Mortgage and Real
Estate Group in Venezuela from 1976 to 1982 at Citibank, N.A. Thereafter, he
served as the Financial Institutions Country Head for Venezuela.

48



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Will Wood has served as the founding principal of Kentwood Associates of
Menlo Park, California since 1993. Mr. Wood 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, he was a Director of the Bankers Association
for Foreign Trade and PEFCO, a privately owned export finance company. Mr.
Wood 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. He worked for Citibank in La Paz,
Bolivia, Lima, Peru, Rio de Janeiro and Sao Paulo, Brazil and began his career
with Citibanks Overseas Division in 1964 in New York.

Sebastiao Toledo Cunha has served as Managing Director of the
International Area at Banco Santos S.A., New York, since March 2002. Mr. Cunha
served as Vice President and General Manager of Banque Sudameris, Miami,
Florida, from 2000 to 2001 and as Director Superintendente (CEO) for Banco
Sudameris Brasil, S. A., from 1998 to 2000. Mr. Cunha was employed by Banco
Real, in various capacities, including; as Executive Director responsible for
International and Foreign Exchange Operation, from 1990 to 1998, as Regional
Director for European Sector from 1988 to 1990 in London, as General Manager of
the International Department, in Sao Paulo from 1986 to 1987, as Deputy
Regional Director London Branch, in charge of the European and African Markets
from 1980 to 1986, as responsible for the opening of Banque Real de Cote
DIvore, Ivory Coast, as Managing Director from 1977 to 1980, and as Manager of
the International Division from 1975 to 1977.

Mario Covo was the founding partner and has served as the Chairman and
Chief Executive Officer of Fin@ccess International Inc. since 1999. He was the
founder of Columbus Advisors and Columbus Group and served in such capacity
from 1995 to 1999. Mr. Covo was employed by Merrill Lynch, as Managing
Director heading the Latin America Capital Markets Group from 1989 to 1995.
Previously, he was employed by Bankers Trust Company, as a Vice President in
the Latin American Merchant Banking Group, focusing on corporate finance and
debt-for-equity swaps from 1985 to 1989. He was employed as an International
Economist for Chase Econometrics, focusing primarily on Venezuela and Colombia,
from 1984 to 1985.

José Castañeda has served as Chief Executive Officer of the Bank since
November 1989. He was employed by Banco Río de la Plata, New York, as Manager
and Agent from July 1987 to September 1989. Mr. Castañeda was employed by
Citibank, N.A., Argentina, as Vice President/Head of the Financial Institutions
Group from 1984 to 1987 and by Banco de Crédito del Peru, New York as General
Manager from 1982 to 1984. He also served as Vice President for Crocker
National Bank, San Francisco, CA, from 1979 to 1982 and was employed by
Citibank, N.A., Lima, Peru, as Manager  Government and Financial Institutions
Group from 1968 to 1979.

Gonzalo Menéndez Duque has served as Director of Banco de Chile since
2001. He has also served as a Director of several companies related to Grupo
Luksic, including; Banedwards Compañía de Seguros de Vida, Banchile Corredores
de Bolsa, Cia. Nacional de Teléfonos, Telefónica del Sur and Telefónica de
Coyhaique since 2000, Grupo Minero Antofagasta Minerals since 1997, Holdings
Quiñenco, Minera Michilla, Fundaciones A. Luksic and P. Baburizza since 1996,
and Antofagasta Plc, England since 1985. Mr. Duque was a Director of Banco
Edwards from 1999 to 2001, Banco Santiago from 1993 to 1999 and Grupo
Financiero OHCH from 1996 to 1999. He was also the Chief Executive Officer of
the following companies: Empresas Lucchetti, S.A. from 1994 to 1998, Banco
OHiggins from 1985 to 1992 and Antofagasta Group from 1980 to 1985.

Senior Management

Executive Officers

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

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|                          |  |                                                           |  |            
|------------------------- |  | --------------------------------------------------------- |  | -----------
|                          |  |                                                           |  | Country of 
|Name                      |  | Position                                                  |  | Citizenship
|                          |  |                                                           |  |            
|José Castañeda            |  | Chief Executive Officer                                   |  | Peru       
|                         
|                         
|                         
|                         
|                          |  |                                                           |  |            
|                         
|                         
|                         
|                         
|Jaime Rivera              |  | Chief Operating Officer                                   |  | Guatemala  
|                         
|                         
|                         
|                         
|                          |  |                                                           |  |            
|                         
|                         
|                         
|                         
|Miguel Moreno             |  | Senior Vice President  Comptroller                       |  | Colombia   
|                         
|                         
|                         
|                         
|                          |  |                                                           |  |            
|Christopher E. D. Hesketh |  | Senior Vice President, Treasury                           |  | Barbados   
|                         
|                         
|                         
|                         
|                          |  |                                                           |  |            
|                         
|                         
|                         
|                         
|Haydeé A. de Cano         |  | Senior Vice President,
Administration and Human Resources |  | Panama     
|                         
|                         
|                         
|                         
|                          |  |                                                           |  |            
|                         
|                         
|                         
|                         
|Carlos Yap S              |  | Vice President, Finance and
Performance Management        |  | Panama     
|                         
|                         
|                         
|                         
|                          |  |                                                           |  |            
|                         
|                         
|                         
|                         
|Miguel A. Kerbes          |  | Vice President, Risk Management                           |  | Uruguay    
|                         
|                         
|                         
|                         
|                          |  |                                                           |  |            
|                         
|                         
|                         
|                         
|Joaquín Uribe             |  | Vice President, Processes,
Technology and Operations      |  | Colombia   

José Castañeda has served as Chief Executive Officer of the Bank since
November 1989. He was employed by Banco Río de la Plata, New York, as Manager
and Agent from July 1987 to September 1989. Mr. Castañeda was employed by
Citibank, N.A., Argentina, as Vice President/Head of the Financial Institutions
Group from 1984 to 1987 and employed by Banco de Crédito del Peru, New York as
General Manager from 1982 to 1984. He also served as Vice President for
Crocker National Bank, San Francisco, CA, from 1979 to 1982 and was employed by
Citibank, N.A., Lima, Peru, as Manager  Government and Financial Institutions
Group from 1968 to 1979.

Jaime Rivera has served as the Chief Operating Officer of the Bank since
March 2002. Previously, Mr. Rivera was employed by the Bank of America in
various capacities since 1978, including; as Managing Director, Latin America
Financial Institutions, Miami from 1998 to 2002, as Managing Director of the
Latin America Corporate Finance team, New York From 1995 to 1998, as Managing
Director/General Manager  Brazil, Sao Paulo, Brazil from 1990 to 1995, as
General Manager  Argentina & Uruguay, Buenos Aires, Argentina, from 1989 to
1990, as Marketing and Credit Manager  Chile, Santiago, Chile, from 1986 to
1989, as General Manger  Guatemala, Guatemala City, from 1982 to 1986, as
Information Systems Division Manger, Caracas, Venezuela, from 1980 to 1982, and
as an Account Officer  Central America & Caribbean, Guatemala City, Guatemala,
from 1978 to 1980.

Miguel Moreno has served as Senior Vice President, Comptroller of the Bank
since September 2001. He was a partner and Information Technology Consulting
Manager for PriceWaterhouse, Bogotá, Colombia from 1988 to 2001 and served as
Vice President of Information Technology and Operations for Banco de Credito,
Bogotá, Colombia from 1987 to 1988. Mr. Moreno served as Chief Executive
Officer, TM Ingeniería, Bogotá, Colombia, from 1983 to 1987 and as Chief
Executive Officer, ICDS Ltd., Bogotá, Colombia, from 1982 1987. He was the
Head of the Industrial Engineering Department, Los Andes University, Colombia
from 1982 to 1984. Mr. Moreno was employed by SENA, Organization and Systems
Office and Planning Consulting, Colombia from 1977 to 1981 and worked for the
Finance and Public Credit Ministry of Colombia, as Advisor to the Minister from
1976 to 1977.

Christopher E. D. Hesketh has served as Senior Vice President, Treasury
of the Bank since September 1989. He was employed by Yamaichi International
America, Inc. as Vice President, Corporate Finance Department, in New York from
1986 to 1989. Mr. Hesketh was previously employed by Manufacturers Hanover
Overseas Corporation, New York, in various capacities since 1980, including;
Regional Credit Manager, New

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York from 1985 to 1986, Credit Director, Madrid,
Spain from 1982 to 1985, and Assistant Credit Manager of Manufacturers Hanover
Leasing Corporation, New York from 1980 to 1982. He was employed by Barclays
Bank International, in various capacities from 1974 to 1980, in Spain and
London.

Haydeé A. de Cano has served as Senior Vice President, Administration and
Human Resources of the Bank since 2001. Ms. de Cano previously served as
Senior Vice President, Administration, of the Bank from
1992 to 2001 and as Vice President of Human Resources, Organization and
Methods from 1980 to 1992. Prior to her employment by the Bank, she held
industrial engineer positions at the Autoridad Portuaria Nacional, Reed
Management Consulting Group, Aseguradora Mundial and Cerveceria Nacional from
1974 to 1979.

Carlos Yap S. has served as Vice President, Finance and Performance
Management of the Bank since 1993. Prior to this position, Mr. Yap worked for
the Bank in the departments of Institutional Planning, Treasury, Correspondent
International Banking and Capital Markets from 1980 to 1993. Prior to his
employment by the Bank, Mr. Yap worked for Banco Nacional de Panama in its
Credit Department from 1979 to 1980, Azucarera Nacional, S.A. and the Panama
Canal Company from 1977 to 1979.

Miguel Kerbes has served as Vice President, Risk Management of the Bank
since September 2000. He was the Assistant Credit Director for the Southern
Cone Area of Banco Santander  Chile from 1995 to 2000. Mr. Kerbes also served
as the Head of Credit Division at Banco Boston Chile from 1992 to 1995 and was
employed by ING Bank in various capacities from 1982 to 1992.

Joaquín Uribe has served as Vice President, Processes, Technology and
Operations of the Bank since September 2001 and previously served as Vice
President of Operations and Technology, Consumer Banking Technology for
Citibank, Colombia from 1997 to 2001. Mr. Uribe held the positions of Senior
Analyst, Project Manager and Information Systems Manager for UNISYS
Corporation, Colombia, from 1987 to 1997. Mr. Uribe was a Professor, served as
the Director of the Data Processing Center and was a Senior Analyst for The
Colombian School of Engineering from 1981 to 1987.

Compensation

The aggregate amount of compensation paid by the Bank during the year
ended December 31, 2001 to the executive officers of the Bank as a group for
services in all capacities, including compensation paid pursuant to the Banks
bonus plan, was $1,950,180. The Banks bonus plan was established by the Board
of Directors, in accordance with a performance-based compensation scheme. On
an annual basis, the Board of Directors approves the bonus amount that will be
awarded to each of the Banks executive officers and employees based on the
achievement of goals established at the institutional level. All employees
participate in the bonus plan based on their performance at the departmental
and individual level. At December 31, 2001, the total amount set aside or
accrued by the Bank to provide pension, retirement or similar benefits for
employees was $1,988,832. During the year ended December 31, 2001, the Bank
granted a total number of 37,750 stock options under its stock option plans
(see Share Ownership below) to the executive officers of the Bank as a group.

On April 28, 2000, the Board of Directors approved a compensation plan for
non-employee Directors (the Compensation Plan) under which such non-employee
Directors are eligible to receive compensation both in the form of cash and in
the form of stock options to purchase Class E shares. With respect to the cash
component of compensation, each non-employee Director is eligible to receive an
annual amount of up to $20,000 for his services as a director and an additional
amount of $2,500 for each meeting of the Board of Directors attended. With
respect to the stock option component of compensation, each non-employee
Director is eligible to receive options to purchase Class E shares under a
stock option plan authorized by the Board of Directors on April 28, 2000 (the
Board Plan), as more fully described below. The Chairman of the Board of
Directors is eligible to receive an additional fifty- percent (50%) of the
compensation that other directors are eligible to receive under the
Compensation Plan with respect to the cash component and the stock option
component of compensation. The aggregate amount of compensation in cash paid by
the Bank during the year ended December 31, 2001 to the directors of the Bank
as a group for their services as Directors was approximately $377,500.

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Pursuant to the Board Plan, each year the Board of Directors may grant
options to each non-employee Director to purchase Class E shares of the Bank.
The aggregate number of Class E shares that may be issued upon exercise of
options under the Board Plan is 50,000. If options are granted under the Board
Plan in any calendar year, the Chairman of the Board of Directors will receive
options to purchase shares that have an aggregate value of $15,000 on the date
of grant and each other Director will receive options to purchase shares
that have an aggregate value of $10,000 on the date of grant. The
exercise price for all options under the Board Plan will be equal to the fair
market value of a Class E share on the date of grant. Directors will fully
vest in their options on the one-year anniversary of the date of grant and such
options may be exercised at any time thereafter, up to the fifth anniversary of
the date of grant. All Directors must pay the exercise price in cash, except
that the Board of Directors may determine, in its discretion, to allow payment
of the exercise price in Class E shares. Except in the case of death or
disability, all unvested options of a grantee will be forfeited upon the
termination of such grantees services as a Director of the Bank. As of May
31, 2002, stock options with respect to 2,584 Class E shares had been granted
by the Board of Directors under the Board Plan at an exercise price of $32.88
per Class E share. The Board of Directors granted all of these stock options
on February 6, 2001. As of the date hereof, none of the stock options granted
by the Board of Directors under the Board Plan have been exercised. In
accordance with the Board Plan, options on 304 Class E shares expired during
2001 (and may be reissued) as a result of the expiration of the term of a
Director.

Board Practices

The Board of Directors consists of ten members (each, a Director) in
accordance with the Banks Articles of Incorporation. Pursuant to an amendment
to the 2000 Amended and Restated Articles of Incorporation approved by the
holders of the Banks common stock at the Banks 2002 Annual Meeting, the total
number of members of the Board of Directors was increased on April 16, 2002
from nine (9) Directors to ten (10) Directors. Consequently, the Board of
Directors currently consists of three (3) Class A Directors, two (2) Class B
Directors, three (3) Class E Directors and two (2) Directors representing the
holders of all classes of shares of the Banks common stock. Members of the
Board of Directors are elected at annual meetings of stockholders of the Bank
and each Director serves a term of three years. The terms of office of the
Directors are staggered in order to provide for continuity on the Board of
Directors. In the elections of Directors representing a class of shares of the
Banks common stock, the votes of the holders of such class of shares are
counted separately as a class. The holders of each class of common stock have
cumulative voting rights with respect to the election of Directors representing
such class.

Pursuant to the Articles of Incorporation if on the first working day of
each year, starting from the year 2001, the number of Class B shares is lower
than 20%, but equal or higher than 10%, of the total of all issued and
outstanding shares as a result of their conversion into Class E shares, the
holders of Class B shares will lose the right to elect one (1) Director. If
this occurs, the holders of Class E shares will acquire the right to appoint an
additional Director. Furthermore, if on the first working day of each year
beginning with the year 2001, the amount of Class B shares outstanding is lower
than 10% of the total of all issued and outstanding shares, the holders of
Class B shares will lose the right to elect Directors and the holders of Class
E shares will acquire the right to appoint a second additional Director. At
May 31, 2002, the amount of Class B shares represented 22.16% of the total of
all issued and outstanding shares.

The following table sets forth the names and countries of citizenship of
the Banks dignatarios as of the date hereof, their current office or position
with other institutions, and their current office or position with the Bank.
Dignatarios are elected annually by the members of the Board of Directors.
Dignatarios attend meetings of the Board of Directors, participate in
discussions and offer advice and counsel to the Board of Directors, but do not
have the power to vote (unless they are also Directors of the Bank).

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|                                                         |  |                       |  |                                   
|-------------------------------------------------------- |  | --------------------- |  | ----------------------------------
|                                                         |  |                       |  | Position held by                  
|                                                         |  |                       |  | Dignatario with the               
|Name                                                     |  | County of Citizenship |  | Bank                              
|                                                         |  |                       |  |                                   
|Gonzalo Menéndez Duque
Director
Banco de Chile, Chile    |  | Chile                 |  | Chairman of the Board
of Directors
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |  |                       |  |                                   
|Ricardo M. Arango
Partner,
Arias, Fábrega & Fábrega      |  | Panama                |  | Secretary                         
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |  |                       |  |                                   
|                                                        
|                                                        
|                                                        
|                                                        
|Guillermo Güémez García
Deputy Governor,
Banco de Mexico |  | Mexico                |  | Treasurer                         
|                                                        
|                                                        
|                                                        
|                                                        
|                                                         |  |                       |  |                                   
|                                                        
|                                                        
|                                                        
|                                                        
|José Castañeda 
Chief Executive Officer
BLADEX           |  | Peru                  |  | Chief Executive Officer           

Audit Committee

The members of the Audit Committee (created pursuant to the powers granted
to the Board of Directors under the Banks Articles of Incorporation) are
Sebastiao Toledo Cunha, Valentín Hernandez, Mario Covo and Ernesto Bruggia (who
serves as Chairman). The Audit Committee met three times in the fiscal year
ended December 31, 2001. Included among the oversight functions of the Audit
Committee are: (i) the recommendation of the Banks independent auditors for
appointment by the stockholders of the Bank; (ii) review of the Banks external
audit plan and the results of the auditing engagement of the Banks independent
auditors; (iii) review of the internal audit plan and the results of the Banks
internal audits; and (iv) review of the adequacy of the Banks system of
internal controls.

Based on reviews and discussions, the Audit Committee recommended to the
Board of Directors that the audited financial statements for the fiscal year
ended December 31, 2001 be included in the Banks Annual Report.

The aggregate amount of fees paid by the Bank to its independent auditors
for professional services rendered in connection with the audit of the Bank for
the fiscal year ended December 31, 2001 was approximately $182,049.

Certain Directors also serve on the other committees established by the
Board of Directors, including the Credit Committee, the Technology Committee
and the Personnel Committee.

The Bank does not have any Directors service contracts providing for
benefits upon termination of their appointment.

The Banks Personnel Committee among other functions, performs the
functions of a remuneration committee. The members of the Personnel Committee
are Will Wood (who serves as Chairman), Ernesto Bruggia, Guillermo Güemez and
Miguel Gómez.

Advisory Council

The Advisory Council was created by the Board of Directors in April 2000
pursuant to the powers granted to the Board of Directors under the Banks
Articles of Incorporation. The duties of the members of the Advisory Council
consist primarily of providing advice to the Board of Directors and management
with respect to

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the business of the Bank in their areas of expertise. During
the fiscal year ended December 31, 2001, the Advisory Council met twice.

Each member of the Advisory Council receives $5,000 for each Advisory
Council meeting attended. The aggregate amount of fees paid by the Corporation
during the fiscal year ended December 31, 2001 for services rendered by the
Advisory Council during 2001 was approximately $55,000.

The following table sets forth the names of the members of the Advisory
Council of the Bank as of the date hereof and certain other information.

|                            |  |                                    |  |            
|--------------------------- |  | ---------------------------------- |  | -----------
|                            |  |                                    |  | Country of 
|Name                        |  | Position                           |  | Citizenship
|                            |  |                                    |  |            
|Luis Pagani                 |  | President                          |  | Argentina  
|                           
|                           
|                           
|                           
|                            |  | Arcor S. A. I. C                   |  |            
|                           
|                           
|                           
|                           
|Roberto Teixeira Da Costa   |  | Vice Chairman of the Board         |  | Brasil     
|                           
|                           
|                           
|                           
|                            |  | Banco Sul America                  |  |            
|                           
|                           
|                           
|                           
|Nicanor Restrepo Santamaría |  | President                          |  | Colombia   
|                           
|                           
|                           
|                           
|                            |  | Cía. Suramericana de Seguros, S. A |  |            
|                           
|                           
|                           
|                           
|Carlos Martabit             |  | General Manager, Finance Division  |  | Chile      
|                           
|                           
|                           
|                           
|                            |  | Banco del Estado de Chile          |  |            
|                           
|                           
|                           
|                           
|Eugenio Clariond            |  | Chief Executive Officer            |  | Mexico     
|                           
|                           
|                           
|                           
|                            |  | Grupo Imsa, S. A. de C. V          |  |            
|                           
|                           
|                           
|                           
|Alberto Motta, Jr.          |  | Vice President                     |  | Panama     
|                           
|                           
|                           
|                           
|                            |  | Inversiones Bahía Ltd.             |  |            
|                           
|                           
|                           
|                           
|Alfredo Riviere             |  | President                          |  | Venezuela  
|                           
|                           
|                           
|                           
|                            |  | Sural, C. A                        |  |            

Employees

As of December 31, 1999 and 2000, the total number of permanent employees
of the Bank was 187 and 197, respectively. As of December 31, 2001, the total
number of permanent employees was 215, which were geographically distributed as
follows: Head Office in Panama:189; New York Agency 8; BLADEX Securities, LLC
7; Representative Office in Argentina 3; Representative Office in Brazil 4; and
Representative Office in Mexico 4.

Share Ownership

On October 13, 1995, the Board of Directors adopted a stock option plan
(the 1995 Stock Option Plan) authorizing the Bank to grant to eligible
executive officers and employees stock options on up to 300,000 Class E shares.
The 1995 Stock Option Plan provides that options may be granted at an
exercise price equal to the fair market value of the Class E shares on the date
of the grant of the option. On October 1, 1999, the Board of Directors adopted
another stock option plan (the 1999 Stock Option Plan) authorizing the Bank
to grant to eligible executive officers and employees stock options on up to
350,000 Class E shares. The 1999 Stock Option Plan provides that options may
be granted at an exercise price equal to the fair market value of the Class E
shares on the date of the grant of the option. Participants in the 1999 Stock
Option Plan who remain employed will

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become fully vested in their options four
years from the date of grant. Options granted under both the 1995 Stock Option
Plan and the 1999 Stock Option Plan remain outstanding for a period of 10 years
unless sooner forfeited.

The following table sets forth information regarding the stock options
granted under the 1995 Stock Option Plan and the 1999 Stock Option Plan since
the inception of these plans. Each exercise price listed below
is equal to the fair market value of the Class E shares on the dates on
which the options related thereto were granted under the plans.

|                 |  |                  |        |                |  |   |       | 
|---------------- |  | ---------------- | ------ | -------------- |  | - | ----- | 
|Date of Grant    |  | Number of shares |        | Exercise Price
|                 |  |                  |        |               
|October 13, 1995 |  |                  | 90,000 |                |  | $ | 41.56 | 
|                
|                
|                
|                
|January 31, 1997 |  |                  | 70,000 |                |  |   | 51.19 | 
|                
|                
|                
|                
|February 6, 1998 |  |                  | 70,000 |                |  |   | 42.56 | 
|                
|                
|                
|                
|February 4, 1999 |  |                  | 70,000 |                |  |   | 23.03 | 
|                
|                
|                
|                
|February 4, 2000 |  |                  | 70,000 |                |  |   | 23.16 | 
|                
|                
|                
|                
|February 6, 2001 |  |                  | 70,000 |                |  |   | 32.88 | 

As of May 31, 2002, 62,766 Class E shares have been purchased through the
exercise of stock options granted under the 1995 Stock Option Plan and the 1999
Stock Option Plan.

In 1999, the Board of Directors approved the adoption of two employee
stock programs. These programs were implemented in the year 2001 and have the
following terms:



|(1) |  | Deferred Equity Unit Plan (the DEU Plan): Employees who participate in
the Banks stock purchase plan and make elections thereunder to receive up
to 25% of their annual bonuses in Class E shares of the Bank (the Bonus
Shares) automatically participate in the DEU Plan. Under the DEU Plan,
the Bank grants to the employee one deferred equity unit for every two
Bonus Shares purchased under the stock purchase plan. Each deferred
equity unit represents the right to receive one Class E share of the Bank
(or the economic equivalent thereof.) A participating employee will vest
in the deferred equity units credited to him or her if the participant (i)
remains employed by the Bank through the applicable vesting period and
(ii) allows the Bonus Shares to be held in the Banks custody (or under
alternative arrangements) through the vesting period. The vesting period
is generally three years from the date of purchase as to 50% of the
deferred equity units and five years from the date of purchase as to the
remaining 50% of the deferred equity units. In certain circumstances,
participants will have the opportunity to continue to vest in deferred
equity units after termination of employment. Payments in respect of
deferred equity units are made after vesting. Participating employees
will receive dividend equivalents with respect to their vested deferred
equity units and will receive additional deferred payments (which will
vary depending on the performance of the Class E shares) if and after the
underlying deferred equity units vest.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(2) |  | Deferred Compensation Plan (the DC Plan): The DC Plan has two separate
features. Under the first component of the DC Plan, the Bank may grant to
each eligible employee a number of deferred equity units equal to the
product of (x) an amount equal to a percentage, not to exceed 3%, of the
employees compensation, divided by (y) the fair market value of a Class E
share of stock of the Bank. Each deferred equity unit represents the
right to receive a Class E share (or the economic equivalent thereof).
Employees will vest in the deferred equity units after three years of
service (which includes past service with the Corporation). Subject to
certain acceleration events, distributions will be made in respect of
deferred equity units on the later of (i) the date the vested deferred
equity units are credited to an employees account and (ii) 10 years after
the employee is first credited with deferred equity units under the DC
Plan. Participating employees will receive dividend equivalents with
respect to their vested deferred equity units and will receive additional
deferred payments (which will vary depending on the performance of Class E
shares) if and after the underlying deferred equity units vest. The
second component of the DC Plan allows employees who are not citizens or
residents of the United States to defer a percentage of their
compensation, and receive a discretionary, matching cash contribution. In
no event shall the value of (i) the discretionary, matching cash                                                      

55



---



##### Table of Contents





| |  | contribution. In
no event shall the value of (i) the discretionary, matching cash
contribution made on behalf of an employee and (ii) the grant of deferred
equity units made to such employee exceed 6% of the employees annual
compensation.
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

As of the date hereof, an aggregate number of 122 and 4,308 deferred
equity units, representing the right to acquire the same number of Class E
shares or the economic equivalent thereof, have been granted to eligible
employees of the Bank under the DEU Plan and the DC Plan, respectively.
As of the date hereof, no deferred equity units granted under the DEU Plan or
the DEC Plan have vested.

As of March 31, 2002, the Banks executive officers, Directors and
advisory council members, as a group, owned an aggregate of 49,826 Class E
shares, which was less than 0.7% of all issued and outstanding Class E shares.

The following tables set forth information regarding the number of shares
owned by the Banks executive officers and Directors and options and rights
held under each of the DEU Plan, the DC Plan, the 1995 Stock Option Plan, the
1999 Stock Option Plan and the Board Plan as of May 31, 2002.

|                                                                                |  |                    |        |                    |  |                    |        |                    |  |                  |        |                      |  |  |        |  |  |  |   |  |  |  |     | 
|------------------------------------------------------------------------------- |  | ------------------ | ------ | ------------------ |  | ------------------ | ------ | ------------------ |  | ---------------- | ------ | -------------------- |  |  | ------ |  |  |  | - |  |  |  | --- | 
|                                                                                |  |                    |        |                    |  | Number of Shares   |        |                    |  |                  |        |                      |  |  |        |  |  |  |   |  |  | 
|                                                                                |  |                    |        |                    |  | that may be        |        |                    |  |                  |        |                      |  |  |        |  |  |  |   |  |  | 
|                                                                                |  | Number of Shares   |        | Acquired within 60 |  |                    |        |                    |  |                  |        |                      |  |  |        |  |  |  |   | 
|Name and Position of                                                            |  | Beneficially Owned |        | Days of May 31,    |  | Options under 1995 |        | Options under 1999 |  | Rights under DEU |        |                      |  | 
|Executive Officer                                                               |  | as of May 31, 2002 |        | 2002               |  | Stock Option Plan  |        | Stock Option Plan  |  | Plan             |        | Rights under DC Plan
|                                                                                |  |                    |        |                    |  |                    |        |                    |  |                  |        |                     
|José Castañeda(1)
Chief Executive Officer                                       |  |                    | 25,726 |                    |  |                    | 55,333 |                    |  |                  | 55,648 |                      |  |  | 20,526 |  |  |  | 0 |  |  |  | 350 | 
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Jaime Rivera
Chief Operating Officer                                            |  |                    | 0      |                    |  |                    | 0      |                    |  |                  | 0      |                      |  |  | 0      |  |  |  | 0 |  |  |  | 0   | 
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Miguel Moreno
Senior Vice President 
Controller                                |  |                    | 0      |                    |  |                    | 0      |                    |  |                  | 0      |                      |  |  | 0      |  |  |  | 0 |  |  |  | 0   | 
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Christopher E. D
Hesketh(2)
Senior Vice President 
Treasury                    |  |                    | 3,000  |                    |  |                    | 25,701 |                    |  |                  | 25,433 |                      |  |  | 11,150 |  |  |  | 0 |  |  |  | 228 | 
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Haydeé A. de Cano(3)
Senior Vice President 
Administration and
Human Resources |  |                    | 300    |                    |  |                    | 29,207 |                    |  |                  | 29,720 |                      |  |  | 8,730  |  |  |  | 0 |  |  |  | 174 | 
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Carlos Yap S.(4)
Vice President 
Finance and
Performance Management            |  |                    | 0      |                    |  |                    | 21,900 |                    |  |                  | 21,905 |                      |  |  | 10,492 |  |  |  | 0 |  |  |  | 146 | 
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Miguel A. Kerbes
Vice President 
Risk Management                               |  |                    | 0      |                    |  |                    | 0      |                    |  |                  | 0      |                      |  |  | 3,750  |  |  |  | 0 |  |  |  | 0   | 
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Joaquín Uribe
Vice President 
Processes, Technology
and Operations             |  |                    | 0      |                    |  |                    | 0      |                    |  |                  | 0      |                      |  |  | 0      |  |  |  | 0 |  |  |  | 0   | 



---

|(1) |  | Mr. Castañedas stock options under the 1995 Stock Option Plan were
granted in the following allocations: 18,000 on October 13, 1995, 14,000
on January 31, 1997, 14,000 on February, 1998, 4,666 on February 4, 1999
and 4,982 on February 4, 2000; and under the 1999 Stock Option Plan in the
following allocations: 6,526 on February 4, 2000, and 14,000 on February
6, 2001.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

56



---



##### Table of Contents



|   
|---
|   
|   
|   
|(2)
|   
|   
|   
|   
|(3)
|(4)

The exercise prices of the options granted to the executive officers
listed above under the 1995 Stock Option Plan and the 1999 Stock Option Plan
are set forth below.

|                 |  |                |       | 
|---------------- |  | -------------- | ----- | 
|Date of Grant    |  | Exercise Price
|                 |  |               
|October 13, 1995 |  | $              | 41.56 | 
|                
|                
|                
|                
|January 31, 1997 |  |                | 51.19 | 
|                
|                
|                
|                
|February 6, 1998 |  |                | 42.56 | 
|                
|                
|                
|                
|February 4, 1999 |  |                | 23.03 | 
|                
|                
|                
|                
|February 4, 2000 |  |                | 23.16 | 
|                
|                
|                
|                
|February 6, 2001 |  |                | 32.88 | 

|                        |  |                    |     |                              |  |                   |     |  |  |  |     | 
|----------------------- |  | ------------------ | --- | ---------------------------- |  | ----------------- | --- |  |  |  | --- | 
|                        |  | Number of Shares   |     | Number of Shares that may be |  |                   |     | 
|                        |  | Beneficially Owned |     | Acquired within 60 Days of   |  | Options under the
|Name of Director        |  | as of May 31, 2002 |     | May 31, 2002                 |  | Board Plan       
|                        |  |                    |     |                              |  |                  
|Rubens Amaral           |  |                    | 0   |                              |  |                   | 304 |  |  |  | 304 | 
|                       
|                       
|                       
|                       
|Guillermo Güémez García |  |                    | 0   |                              |  |                   | 0   |  |  |  | 0   | 
|                       
|                       
|                       
|                       
|Miguel Gómez M          |  |                    | 0   |                              |  |                   | 0   |  |  |  | 0   | 
|                       
|                       
|                       
|                       
|Ernesto Bruggia         |  |                    | 0   |                              |  |                   | 304 |  |  |  | 304 | 
|                       
|                       
|                       
|                       
|Valentín Hernández      |  |                    | 0   |                              |  |                   | 304 |  |  |  | 304 | 
|                       
|                       
|                       
|                       
|Will C. Wood            |  |                    | 800 |                              |  |                   | 304 |  |  |  | 304 | 
|                       
|                       
|                       
|                       
|Sebastiao Toledo Cunha  |  |                    | 0   |                              |  |                   | 456 |  |  |  | 456 | 
|                       
|                       
|                       
|                       
|Mario Covo              |  |                    | 0   |                              |  |                   | 304 |  |  |  | 304 | 
|                       
|                       
|                       
|                       
|Jose Castenada          |  |                    | 0   |                              |  |                   | 0   |  |  |  | 0   | 
|                       
|                       
|                       
|                       
|Gonzalo Menéndez Duque  |  |                    | 0   |                              |  |                   | 304 |  |  |  | 304 | 

For additional information regarding stock options granted to executive
officers and Directors, see Note 14 of the Notes to the Consolidated Financial
Statements.




Item 7. Major Shareholders and Related Party Transactions

Major Shareholders

As of the date hereof, the Bank is not directly or indirectly owned or
controlled by another corporation or any foreign government, and no person is
the registered owner of more than 7% of the total outstanding shares of voting
capital stock of the Bank.

57



---



##### Table of Contents



The following table sets forth information regarding the Banks
shareholders that are the beneficial owners of 5% or more of any one class of
the total outstanding shares of voting capital stock of the Bank, at May 31,
2002:

|                                        |  |                  |  |            |  |            |           |  |  |  |       |   |  |  |      |   |  |  |  | 
|--------------------------------------- |  | ---------------- |  | ---------- |  | ---------- | --------- |  |  |  | ----- | - |  |  | ---- | - |  |  |  | 
|                                        |  | At May 31, 2002 
|                                        |  |                 
|Class A                                 |  | Number of Shares |  | % of Class |  | % of Total
|                                        |  |                  |  |            |  |           
|Banco de la Nación Argentina            |  |                  |  |            |  |            | 462,543   |  |  |  | 9.4   | % |  |  | 2.7  | % | 
|                                       
|                                       
|                                       
|                                       
|Banco de la Nación Peru                 |  |                  |  |            |  |            | 446,556   |  |  |  | 9.0   | % |  |  | 2.6  | %
|                                       
|                                       
|                                       
|                                       
|Banco Central del Paraguay              |  |                  |  |            |  |            | 434,658   |  |  |  | 8.8   | % |  |  | 2.5  | % | 
|                                       
|                                       
|                                       
|                                       
|Banco do Brasil                         |  |                  |  |            |  |            | 431,217   |  |  |  | 8.8   | % |  |  | 2.5  | %
|                                       
|                                       
|                                       
|                                       
|Banco Central del Ecuador               |  |                  |  |            |  |            | 431,217   |  |  |  | 8.8   | % |  |  | 2.5  | % | 
|                                       
|                                       
|                                       
|                                       
|Banco del Estado de Chile               |  |                  |  |            |  |            | 323,413   |  |  |  | 6.6   | % |  |  | 1.9  | %
|                                       
|                                       
|                                       
|                                       
|Banco de Comercio Exterior de Venezuela |  |                  |  |            |  |            | 288,253   |  |  |  | 5.9   | % |  |  | 1.7  | % | 
|                                       
|                                       
|                                       
|                                       
|Total Shares of Class A Common Stock    |  |                  |  |            |  |            | 4,911,185 |  |  |  | 100.0 | % |  |  | 28.3 | %
|                                        |  |                  |  |            |  |            |           |  |  |  |       |   |  |  |      |  

|                                      |  |                  |           |            |  |            |       |   |  |  |      |  
|------------------------------------- |  | ---------------- | --------- | ---------- |  | ---------- | ----- | - |  |  | ---- | -
|Class B                               |  | Number of Shares |           | % of Class |  | % of Total
|                                      |  |                  |           |            |  |           
|Banco de la Provincia de Buenos Aires |  |                  | 435,360   |            |  |            | 11.3  | % |  |  | 2.5  | %
|                                     
|                                     
|                                     
|                                     
|The Bank of Tokyo  Mitsubishi Ltd.   |  |                  | 294,345   |            |  |            | 7.6   | % |  |  | 1.7  | %
|                                     
|                                     
|                                     
|                                     
|Banco de la Nación Peru               |  |                  | 288,807   |            |  |            | 7.5   | % |  |  | 1.6  | %
|                                     
|                                     
|                                     
|                                     
|Total Shares of Class B Common Stock  |  |                  | 3,842,479 |            |  |            | 100.0 | % |  |  | 22.1 | %
|                                      |  |                  |           |            |  |            |       |   |  |  |      |  

|                                     |  |                  |            |            |  |            |       |   |  |  |       |  
|------------------------------------ |  | ---------------- | ---------- | ---------- |  | ---------- | ----- | - |  |  | ----- | -
|Class E*                             |  | Number of Shares |            | % of Class |  | % of Total
|                                     |  |                  |            |            |  |           
|Genesis Inv. Management              |  |                  | 1,047,000  |            |  |            | 12.2  | % |  |  | 6.0   | %
|                                    
|                                    
|                                    
|                                    
|Harris Associate                     |  |                  | 1,038,000  |            |  |            | 12.1  | % |  |  | 5.9   | %
|                                    
|                                    
|                                    
|                                    
|Farallon Capital Management          |  |                  | 981,700    |            |  |            | 11.4  | % |  |  | 5.6   | %
|                                    
|                                    
|                                    
|                                    
|Fidelity Management                  |  |                  | 897,400    |            |  |            | 10.4  | % |  |  | 5.1   | %
|                                    
|                                    
|                                    
|                                    
|Wellington Management                |  |                  | 602,760    |            |  |            | 7.0   | % |  |  | 3.5   | %
|                                    
|                                    
|                                    
|                                    
|Brandes Investment                   |  |                  | 518,155    |            |  |            | 6.0   | % |  |  | 3.0   | %
|                                    
|                                    
|                                    
|                                    
|Total Shares of Class E Common Stock |  |                  | 8,588,994  |            |  |            | 100.0 | % |  |  | 49.5  | %
|                                     |  |                  |            |            |  |            |       |   |  |  |       |  
|Total Shares of Common Stock         |  |                  | 17,342,658 |            |  |            |       |   |  |  | 100.0 | %
|                                     |  |                  |            |            |  |            |       |   |  |  |       |  



---

|* |  | Source: Bloombergs Report dated June 25, 2002
|- |  | ----------------------------------------------

All common shares have the same rights and privileges regardless of their
class, except that: (i) 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 Amended and Restated
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 Amended and Restated Articles of
Incorporation; (ii) the Class E shares and the preferred shares are freely
transferable, while the Class A shares and Class B shares can only be
transferred to qualified holders; (iii) the Class B shares may be converted
into Class E shares; (iv) the holders of Class A shares and Class B shares
benefit from pre-emptive rights, but the holders of Class E common shares do
not; and (v) the classes vote separately for their respective Directors.

Prior to the approval of the Amended and Restated Articles of
Incorporation at the 2000 Annual Meeting, the holders of the Class C shares and
the Class D shares had the right to convert up to 100% of their Class C shares
or Class D shares into Class E shares at a conversion rate of ten (10) Class C
shares or ten (10) Class D shares for nine (9) Class E shares. From 1998
through 2000, a total of 300,420 Class C shares were converted into 270,377
Class E share. During 1998 and 1999, two holders of Class C shares representing
6.3% and 6.7%, respectively, of the total amount of all Class C shares
outstanding converted their holdings into Class E shares. During 2000, a total
of 417,133 Class B shares were converted into 417,128 Class E shares.

As of May 31, 2002, there were no Class A shares held by institutions
located in the United States. At May 31, 2002, 3.9% of the total Class B
shares outstanding were held by institutions located in the United States,
representing 0.9% of the Banks total common shares. Because a majority of
Class E shares are held by or in the

58



---



##### Table of Contents



name of the Depository Trust Company, the Bank does not have precise
information regarding Class E shareholders in this regard.

Related Party Transactions

Certain directors of the Bank are executive officers of banks and/or other
financial institutions located in Latin America, the Caribbean and elsewhere.
Some of these banks and/or other financial 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 such 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.

The consolidated balance sheets and consolidated statements of income
included in the Consolidated Financial Statements include information
pertaining to transactions with related parties (shareholder banks and their
affiliates), including the amounts of such transactions. See Note 3 to the
Notes of the Consolidated Financial Statements.




Item 8. Financial Information

Consolidated Statements and Other Financial Information

See Item 19.

Dividends

Prior to December 2000, the Board of Directors declared and paid dividends
to holders of both common stock and preferred stock on an annual basis. The
Board of Directors, at a meeting held on February 4, 2000, declared an annual
dividend of $1.25 per common share, an increase of 30% compared to $0.96 paid
in 1999. This dividend was payable on March 3, 2000 to shareholders of record
as of February 18, 2000. The aggregate amount of the common stock dividend
declared was approximately 26% of BLADEXs reported net income for 1999, after
payment of preferred stock dividends. On April 28, 2000, the Board of Directors
approved a one time special dividend of $1.25 per common share payable on May
29, 2000 to shareholders of record as of May 11, 2000. The Board of Directors
also declared a special cash dividend of $2.26 per preferred share, payable in
two equal installments on May 15, 2000 and November 15, 2000 to preferred
stockholders of record as of April 28, 2000 and October 31, 2000, respectively.

On December 6, 2000, the Board of Directors approved an increased dividend
payout ratio and a plan to declare and pay dividends on a quarterly basis,
rather than annually. The Bank intended through these actions to improve
shareholder value while continuing to invest in the Banks growth. The Board of
Directors approved a target dividend payout ratio of 40% of net income. The
Banks cash dividend payout ratio has generally been close to 25% of the prior
years net income. The application of the new target dividend payout ratio of
40% of net income and the quarterly declaration and payment of dividends began
in the first quarter of 2001.

The Board of Directors, at a meeting held on February 5, 2001, declared a
quarterly dividend of $0.47 per common share. This dividend was payable on
March 5, 2001 to stockholders of record as of February 22, 2001. At the same
meeting, the Board of Directors also declared a quarterly cash dividend of
$0.84 per preferred share, payable in two equal installments on May 15, 2001
and November 15, 2001 to preferred stockholders of record as of February 22,
2001 and October 31, 2001, respectively.

The Board of Directors, at a meeting held on April 26, 2001, declared a
regular quarterly cash dividend of $0.47 per common share. This dividend was
payable on May 29, 2001 to stockholders of record as of May 18, 2001. At the
same meeting, the Board of Directors also declared a regular quarterly cash
dividend of $0.84 per preferred share, payable on May 15, 2001 to preferred
stockholders of record as of April 30, 2001.

59



---



##### Table of Contents



The Board of Directors, at a meeting held on July 23, 2001, declared a
regular quarterly cash dividend of $0.47 per common share. This dividend was
payable on August 30, 2001 to stockholders of record as of August 20, 2001. At
the same meeting, the Board of Directors also declared a regular quarterly cash
dividend of $0.84 per preferred share, payable on August 14, 2001 to preferred
stockholders of record as of July 31, 2001.

The Board of Directors, at a meeting held on November 9, 2001, declared a
regular quarterly cash dividend of $0.47 per common share. This dividend was
payable on December 6, 2001 to stockholders of record as of November 23, 2001.
At the same meeting, the Board of Directors also declared a regular quarterly
cash dividend of $0.84 per preferred share, payable on December 20, 2001 to
preferred stockholders of record as of December 6, 2001.

On February 5, 2002, the Board of Directors suspended dividends on common
shares, believing that it is in the best interests of shareholders to conserve
the Banks capital resources until the probable outcome of the Banks exposure
to Argentina is more clear.

Significant Changes

There has not been any significant change since December 31, 2001. The
impact of the future adoption of the SFAS 141, 142, 143 and 144 is not expected
to have a material effect on the Banks financial statements.




Item 9. The Offer and Listing

Offer and Listing Details

On October 1, 1992, the Bank concluded a public offering in the United
States of 4,000,000 Class E shares with no par value. On December 22, 1994,
the Bank concluded another offering of 3,200,000 Class E shares. The Class E
shares are listed on the New York Stock Exchange under the symbol BLX. The
following table shows the high and low sales prices of the Class E shares on
the New York Stock Exchange for the periods indicated.

|     |  |                                |       |     |  |  |       | 
|---- |  | ------------------------------ | ----- | --- |  |  | ----- | 
|     |  | Price per Class E Share (in $)
|     |  |                               
|     |  | High                           |       | Low
|     |  |                                |       |    
|1997 |  |                                | 55.50 |     |  |  | 38.00 | 
|    
|    
|    
|    
|1998 |  |                                | 44.00 |     |  |  | 12.94 | 
|    
|    
|    
|    
|1999 |  |                                | 34.13 |     |  |  | 16.19 | 
|    
|    
|    
|    
|2000 |  |                                | 34.88 |     |  |  | 21.25 | 
|    
|    
|    
|    
|2001 |  |                                | 37.70 |     |  |  | 25.30 | 

|      |                |  |                                |       |     |  |  |       | 
|----- | -------------- |  | ------------------------------ | ----- | --- |  |  | ----- | 
|      |                |  | Price per Class E Share (in $)
|      |                |  |                               
|      |                |  | High                           |       | Low
|      |                |  |                                |       |    
|2000: |                |  |                                |       |     |  |  |      
|     
|     
|     
|     
|      | First Quarter  |  |                                | 28.63 |     |  |  | 21.81 | 
|     
|     
|     
|     
|      | Second Quarter |  |                                | 28.00 |     |  |  | 21.25 | 
|     
|     
|     
|     
|      | Third Quarter  |  |                                | 28.50 |     |  |  | 25.50 | 
|     
|     
|     
|     
|      | Fourth Quarter |  |                                | 34.88 |     |  |  | 24.44 | 
|     
|     
|     
|     
|2001: |                |  |                                |       |     |  |  |      
|     
|     
|     
|     
|      | First Quarter  |  |                                | 34.75 |     |  |  | 30.60 | 
|     
|     
|     
|     
|      | Second Quarter |  |                                | 37.70 |     |  |  | 30.80 | 
|     
|     
|     
|     
|      | Third Quarter  |  |                                | 37.34 |     |  |  | 27.43 | 
|     
|     
|     
|     
|      | Fourth Quarter |  |                                | 34.60 |     |  |  | 25.30 | 

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|      |          |  |                                    |       |     |  |  |       | 
|----- | -------- |  | ---------------------------------- | ----- | --- |  |  | ----- | 
|      |          |  | Closing Price Class E Share (in $)
|      |          |  |                                   
|      |          |  | High                               |       | Low
|      |          |  |                                    |       |    
|2001: |          |  |                                    |       |     |  |  |      
|     
|     
|     
|     
|      | December |  |                                    | 31.35 |     |  |  | 25.30 | 
|     
|     
|     
|     
|2002: |          |  |                                    |       |     |  |  |      
|     
|     
|     
|     
|      | January  |  |                                    | 29.70 |     |  |  | 21.50 | 
|     
|     
|     
|     
|      | February |  |                                    | 23.14 |     |  |  | 15.50 | 
|     
|     
|     
|     
|      | March    |  |                                    | 23.16 |     |  |  | 20.00 | 
|     
|     
|     
|     
|      | April    |  |                                    | 22.25 |     |  |  | 18.02 | 
|     
|     
|     
|     
|      | May      |  |                                    | 19.00 |     |  |  | 18.01 | 

Markets

The Banks Class A shares and Class B shares were sold in private
placements, 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, represent approximately 47% of the total shares of the Banks common
stock issued and outstanding at December 31, 2001.




Item 10. Additional Information

Memorandum and Articles of Association

BLADEX is a Bank organized under the laws of the Republic of Panama,
registered in the Mercantile Section (Persons) of the Public Registry of the
Republic of Panama at file card 021666, roll 1050, image 0002. Article 2 of
BLADEXs Articles of Incorporation states that the purpose of the Bank is to
promote the economic development of Latin American countries, mainly by
promoting foreign trade. For the attainment of this purpose, the Bank may:
(1) establish a Latin American credit system for the export of goods and
services, which shall include granting direct export loans, including financing
the stages prior to and after export; (2) foster a market for bank acceptances
extended as a result of operations pertaining to the export of goods of Latin
American origin; (3) promote the establishment of a Latin American system of
export credit insurance and mechanisms that may supplement existing national
systems; (4) collaborate with Latin American countries in conducting market
research, with a view to promoting their exports of goods and services; and (5)
generally engage in any kind of banking or financial business intended to
promote the development of Latin American countries. The Articles of
Incorporation provide that BLADEX may also engage in activities other than
those described above, provided that it has obtained the approval of the
shareholders in a resolution adopted by the affirmative vote of one-half (1/2)
plus one of the common shares, either present or represented, in a meeting of
shareholders called to obtain such authorization, which affirmative vote shall
necessarily include the vote of three-fourths (3/4) of 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 shareholders by law or the Articles of
Incorporation. The Board of Directors may, however, 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 each of them. The Articles of Incorporation of BLADEX do not contain
provisions limiting the ability of the Board of Directors to approve a
proposal, arrangement or contract in which a Director is materially interested,
or a provision which limits the ability of the Board of Directors to fix the
compensation of its members, a provision which requires the mandatory
retirement of a Director at any prescribed age or a provision which requires
that a certain number of shares be owned by a person to qualify as a Director.

The Board of Directors consists of ten (10) members, as follows: three (3)
Directors are elected by the holders of the Class A shares; two (2) Directors
are elected by the holders of the Class B shares; three (3)

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Directors are
elected by the holders of the Class E shares; and two (2) Directors are elected
by the holders of all of the common shares. Notwithstanding the foregoing, if
due to the conversion of Class B shares, the number of outstanding shares of
this class falls below certain percentages prescribed in the Articles of
Incorporation, holders of Class B shares may lose the right to elect any
member of the Board of Directors.

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

All common shares have the same rights and privileges regardless of their
class, except that: (i) 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; (ii) the Class E shares
and the preferred shares are freely transferable, while the Class A shares
and Class B shares can only be transferred to qualified holders; (iii) the
Class B shares may be converted into Class E shares; and (iv) the holders of
Class A shares and Class B shares benefit from pre-emptive rights, but the
holders of Class E shares do not; and (v) the classes vote separately for
their representative directors.

Preferred shares receive a minimum annual preferred dividend of 8% per
annum to be declared by the Board of Directors and to be paid, as any other
dividend, in semiannual or quarterly installments, as prescribed by the Board
of Directors. The Bank may not pay any dividend in cash for common shares in
any fiscal year until it has paid the minimum preferred dividend corresponding
to preferred shareholders in that year or in any other previous year in which
the aggregate total dividend corresponding to preferred shares has not been
paid. In the event that the Bank fails to pay the aggregate total amount of
the minimum preferred dividend corresponding to preferred shares in a given
fiscal year, and during the following two years fails to pay the aggregate
total amount of the minimum preferred dividend corresponding to preferred
shares in those two following years, as well as the amount which it had failed
to pay in respect of such first year, or if the Bank fails to make any payment
to the sinking fund or fails to redeem any preferred shares, and provided
always that at the time of the occurrence of any of the above such preferred
shares represent at least ten percent (10%) of the total paid in capital of the
Bank, the holders of preferred shares shall be entitled to elect a member of
the Board of Directors, who shall continue in office until the circumstances
from which his appointment has arisen cease to exist. Preferred shares have no
voting rights, except for the election of a Director in the event mentioned
above. Preferred shares have no preemptive rights under Article 6 of the
Articles of Incorporation.

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 vote of one-half
plus one 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 shareholders 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, holders of
the common shares shall hold extraordinary meetings when called by the Board

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of
Directors, as it may deem necessary. The Board of Directors or the President
of the Bank 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 shareholders, 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 shareholders, shareholders 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. Whenever the holders of the
preferred shares are entitled to vote pursuant to the Articles of
Incorporation, a meeting of the holders of the preferred shares shall be called
by the President of the Bank as soon as possible. Upon request to the Board of
Directors or the President of the Bank, shareholders 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 shareholders, it is required that one-half plus one of
the common shares issued and outstanding be represented at the meeting.
Whenever a quorum is not obtained at a meeting of shareholders, the meeting
shall be held on the second meeting date set forth in the notice of the meeting
with the common shares represented on such second meeting date. All
resolutions of shareholders shall be adopted by the affirmative vote of
one-half plus one of the common shares represented at the meeting where the
resolution was adopted, except for those cases mentioned above that require a
super-majority vote.

Class A shares may only be issued as registered shares in the name of any
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 only be issued 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.

Article 11 of the Articles of Incorporation of BLADEX establishes that the
adoption of resolutions approving the merger or consolidation of BLADEX with
another entity requires the affirmative vote of one-half plus one of the common
shares represented at the meeting plus three-quarters (3/4) of all issued and
outstanding class A common shares.

Neither BLADEXs Articles of Incorporation nor its By-laws contains any
provision requiring that any disclosure be made with respect to the ownership
of any shareholder above an ownership threshold.

There are no conditions imposed by the Articles of Incorporation governing
changes in capital which are more stringent than required by Panamanian law.

Material Contracts

The Bank has not entered into contracts outside the ordinary course of
business during the two-year period immediately preceding the date of this
Annual Report.

Exchange Controls

There are currently no Panamanian restrictions on the export or import of
capital, including foreign exchange controls, and no restrictions on the
payment of dividends or interest, nor are there limitations on 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 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.

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

United States Taxes

This summary describes the principal United States federal income tax
consequences of the acquisition, ownership and disposition of the Class E
shares sold in the 1992 and 1994 offerings, 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 and
subsequent holders that hold or will hold, respectively, 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, financial institutions,
tax-exempt entities, life insurance companies, 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 dollar, or a holder that
owns 10% or more of the voting shares of the Bank.

This summary is based upon the Code existing, temporary and proposed
regulations promulgated thereunder, judicial decisions and administrative
procurements, 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 United States federal, state and local, and foreign
tax consequences of the purchase, ownership and disposition of Class E shares
in their particular circumstances.

As used herein, a U.S. Holder refers to a holder of Class E shares that
is, for United States federal income tax purposes, (i) an individual citizen or
resident of the United States, (ii) a corporation organized or created in or
under the laws of the United States or any political subdivision thereof, (iii)
an estate the income of which is subject to United States federal income
taxation without regard to the source of its income, (iv) 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 United States persons 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 (v) any holder otherwise subject to United States 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). In the case of a holder of Class E shares that is a partnership for
United States tax purposes, each partner will take into account its allocable
share of income, gain or loss from the Class E shares, and will take such
income, gain or loss into account under the rules of taxation applicable to
such partner, taking into account the activities of the partnership and the
partner.

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 United States 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 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  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

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the
dividends received deduction under Section 243 of the Code with respect to
such dividends. 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, financial services 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 United States 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
(i) that are engaged in a U.S. trade or business, (ii) that are former citizens
or long-term residents of the United States, controlled foreign corporations,
foreign personal holding companies, corporations which accumulate earnings to
avoid U.S. federal income tax, and certain foreign charitable organizations,
each within the meaning of the Code, or (iii) 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 Class E shares.

Taxation of Capital Gains

Gain or loss realized by a U.S. Holder on the sale or other disposition of
Class E shares will be subject to United States 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 noncorporate 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
noncorporate U.S. Holders may be carried over indefinitely.

A non-U.S. Holder of Class E shares will generally not be subject to
United States federal income tax or withholding tax on gain realized on the
sale or other disposition of Class E shares. Special rules may apply in the
case of non-U.S. Holders (i) that are engaged in a U.S. trade or business, (ii)
that are former citizens or long-term residents of the United States,
controlled foreign corporations, foreign personal holding companies,
corporations which accumulate earnings to avoid U.S. federal income tax, and
certain foreign charitable organizations, each within the meaning of the Code,
or (iii) 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 (i) 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 (ii) 50% or more of its assets (by value) produce, or are

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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 for active banks licensed by federal or state
regulatory authorities to do business as a bank in the United States, provided
the foreign bank is not prohibited from taking deposits or making loans.
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 U.S. licensed 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 (i) the
gain or excess distribution would be allocated ratably over the U.S. Holders
holding period for the Class E shares, (ii) the amount allocated to the current
taxable year would be treated as ordinary income, (iii) the amount allocated to
each prior year would be subject to tax at the highest rate in effect for that
year; and (iv) the interest charge 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 who 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 who 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.

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

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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 30% 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 (i) 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 (ii) provides a taxpayer identification number, certifies as to no
loss of exemption and otherwise complies with the applicable requirements of
the backup withholding rules. 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 summary of certain Panamanian tax matters is based upon the
tax laws of Panama and regulations thereunder in effect as of the date of this
Annual Report and is subject to any subsequent change in Panamanian laws and
regulations that may come into effect after such date. The principal
Panamanian tax consequences of ownership of Class E shares are as follows:

Generally

Panamas income tax is exclusively territorial. Only income actually
derived from sources within Panama is subject to taxation. Income derived by
Panamanian or foreign corporations or individuals from offshore operations is
not taxable. The territorial principle of taxation has been in force
throughout the history of the country and is supported by legislation,
administrative regulations and court decisions.

The Bank is not subject to income taxes in Panama pursuant to a special
exemption granted by the government of Panama under Law 38 enacted on July 25,
1978. In addition, even in the absence of such special legislation, under
Panamanian law banks are not subject to income tax on their offshore income.
Since the Banks loans are primarily made outside Panama, the Bank would have
limited tax liability even in the absence of special legislation.

Taxation of Distributions

Dividends and distributions paid by the Bank in respect of its shares are
also exempt from withholding tax under the aforementioned special legislation.
If such special legislation did not exist, Panama would impose a 10%
withholding tax on dividends or distributions paid in respect of the Banks
registered shares (20% in respect of the Banks bearer shares), to the extent
such dividends are paid from income derived by the Bank from Panamanian
sources.

Taxation of Capital Gains

Inasmuch as almost all of the Banks income derives from non-Panamanian
sources, capital gains realized by an individual or corporation, regardless of
its nationality or residency, on the sale or other disposition outside of
Panama of Class E shares should not be subject to taxes in Panama. However,
there are no rules of allocation with respect to derivation of income currently
in effect in Panama and it cannot be determined with certainty
when the tax authorities would consider that a significant amount of the
Banks income derives from Panamanian sources, thus resulting in the taxation
of capital gains realized on the sale or disposition of the Banks Class E
shares. Recently enacted legislation would help to settle uncertainties on
this topic as it makes clear that capital gains realized on the sale or
disposition of securities registered with the National Securities Commission of

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Panama would not be subject to taxes in Panama, provided that the sale or
disposition is made through a stock exchange or any other organized market.
The Banks Class E shares are not currently registered with the National
Securities Commission of Panama.




Item 11. Quantitative and Qualitative Disclosure About Market Risk

The information set forth in Note 17 and Note 2(j) of the Notes to the
Consolidated Financial Statements and in Operating and Financial Review and
Prospects  Liquidity,  Asset/Liability Management, and  Interest Rate
Sensitivity are incorporated herein by reference.

The Banks risk management policies, as approved by the Banks Board of
Directors 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 Banks Board of
Directors constitute the Banks Credit Policy and Risk Assessment Committee,
which meets on a regular basis and monitors and controls the risks in each
specific area. At the management level, the Bank has a Risk Management
Department that measures and controls the credit and market exposure of the
Bank. Additionally, the Bank established ALCO (as defined in Information on
the Company  Asset/Liability Management) with the purpose of monitoring and
managing the interest rate gap of the Bank and also to coordinate lending and
funding activities in order to optimize profits and reduce interest rate and
liquidity risks. ALCO consists of participants from the Credit and Marketing
Department, the Treasury Department, the Risk Management Department and the
Finance and Performance Management Department as well as the Chief Operating
Officer.

The Banks primary market risks are comprised of liquidity risk and
interest rate risk and, to a lesser extent, currency exchange risk and price
risk.

The Banks liquidity risk is the risk of not being able to maintain an
adequate cash flow to fund operations and meet obligations and other
commitments on a timely basis. The Bank manages short-term liquidity risk by
investing a minimum of 50% of the liquidity funds generated by demand, call
accounts and time deposits in overnight deposits with maturities of less than
one week and by investing the remaining balance in short-term time deposits
with maturities of up to six months and investment funds or negotiable money
market instruments, such as Euro certificates of deposits, commercial paper,
bankers acceptances and other liquid instruments, with maturities of up to 180
days. See Information on the Company  Investments. These instruments must
be of investment grade (carrying two of the following ratings: A-1, P-1 or F-1
from Standard & Poors, Moodys Investors or Fitch IBCA, respectively) and must
have a liquid secondary market. Interbank deposits are with reputable
international banks located outside of the Region that usually carry ratings of
A-1, P-1 or F-1 by two of the above rating agencies. These banks must have a
correspondent relationship with BLADEX and be approved by the Board of
Directors on an annual basis. The primary objectives for these investments are
security and liquidity. In order to manage its liquidity needs, the Banks
liquidity position is reviewed and monitored on a daily basis by management.

The Banks interest rate risk arises from the Banks liability sensitive
position in the short-term, which means that the Banks interest-bearing
liabilities reprice more quickly than the Banks interest-earning assets.
Consequently, there is a potential adverse impact on the Banks net interest
income that might result from changes in interest rates. The Banks interest
rate risk is managed by attempting to match the term and repricing
characteristics of the Banks interest rate sensitive assets and liabilities.
The Banks policy with respect to interest rate gaps provides that the gap
between short-term interest-earning assets and interest-bearing liabilities on
a cumulative basis at 90 days cannot exceed 200% of the Banks total capital.
For the period on a cumulative basis at 180 days, the gap cannot exceed 100% of
the Banks total capital. The Banks policy with respect to interest
rate gaps also provides that the Bank is to match fund interest-earning
assets over 365 days, as discussed above. The Bank also uses interest rate
swaps on a limited basis as part of its interest rate risk management. These
interest rate swaps are made either in a single currency or cross-currency for
a prescribed period to exchange a series of interest rate flows, which involve
fixed for floating rate interest payments. For quantitative information

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relating to the Banks interest rate risk and information
relating to the
Banks management of interest rate risk, see Note 17 and Note 2(j) of the Notes
to the Consolidated Financial Statements.

Derivative Financial Instruments

Effective January 1, 2001, the Bank adopted SFAS 133 relating to
accounting for financial instruments that are considered to be derivatives.
Pursuant to SFAS 133, these financial instruments are booked on the balance
sheet at their fair value. For control purposes, these financial instruments
are recorded at their nominal amount or notional amount on the memorandum
accounts.

In the normal course of business, the Bank had outstanding derivative
financial instruments in the following notional amounts at the dates indicated
below:

|                                                  |  |               |     |      |  |   |     | 
|------------------------------------------------- |  | ------------- | --- | ---- |  | - | --- | 
|                                                  |  | December 31, 
|                                                  |  |              
|                                                  |  | 2001          |     | 2000
|                                                  |  |               |     |     
|                                                  |  | (in millions)
|Options                                           |  | $             | 100 |      |  | $ | 100 | 
|                                                 
|                                                 
|                                                 
|                                                 
|Interest rate swaps, less set-offs                |  |               | 156 |      |  |   | 190 | 
|                                                 
|                                                 
|                                                 
|                                                 
|Foreign exchange forward contracts, less set-offs |  |               | 450 |      |  |   | 346 | 
|                                                  |  |               |     |      |  |   |     | 
|                                                  |  | $             | 706 |      |  | $ | 636 | 
|                                                  |  |               |     |      |  |   |     | 

Options

During the third quarter of 1997, the Bank entered into a series of put
option contracts providing for guarantees to a counterparty with respect to
certain assets with an aggregate face value of $221.4 million. At certain
specified exercise dates, or in the event of default, the counterparty has the
right to sell an underlying asset to the Bank (generally at par), if the market
yield on the underlying asset exceeds the strike yield set forth in the
contract. The underlying assets consist of debt issued by several sovereign
borrowers in the Region for a notional value of $221.4 million. At December
31, 2001, the notional value of these outstanding options was $100 million.
Provisions for possible losses on these guarantees were established in 1997 and
1998 to cover the mark-to-market valuation of the underlying assets of the
options. On January 1, 2001 as a result of the adoption of SFAS 133, the
allowance for losses on guarantees was eliminated and the balance of $5.0
million, together with the remaining unamortized premium received of $1.9
million, were compared to $5.6 million generated by the market valuation of
options at that date, resulting in a SFAS 133 transition adjustment of
approximately $1.4 million. See Note 19 to the Consolidated Financial
Statements.

Derivative Financial Instruments

The Bank utilizes derivatives and foreign exchange financial instruments
for its asset/liability activities. All of the forward exchange contracts
entered into during 2001 and 2000 were made by the Bank as end-user to hedge
foreign exchange risks arising from the Banks lending activity and the
issuance of non-dollar short-term Euro commercial paper and Euro medium-term
notes. The Bank also engages in some foreign exchange trades to serve
customers transaction needs and all positions are hedged with an off-setting
contract in the same currency. The Bank manages and controls the risks on
these buy and sell foreign currency contracts by establishing limits on amounts
of such contracts and terms by clients, and by having adopted policies that do
not allow it to maintain open positions. Interest rate swaps are made either
in a single currency or cross-currency for a prescribed period to exchange a
series of interest rate flows, which involve fixed for floating interest
payments or vice versa.

Types of Derivative and Foreign Exchange Instruments

Derivative and foreign exchange instruments negotiated by the Bank are
mainly executed over-the-counter (OTC). These contracts are executed between
two counterparts that negotiate specific agreement terms,

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including notional
amount, exercise price and maturity. The following instruments are used by the
Bank for purposes of asset/liability activities:

Interest rate swapsare contracts in which a series of interest rate flows
in a single currency are exchanged over a prescribed period.

Cross-currency swapsare contracts that generally involve the exchange of
both interest and principal amounts in two different currencies.

Forward foreign exchange contractsrepresent agreements to transact on a
future date at agreed-upon terms.

Foreign Exchange Risk Management

Whenever possible, foreign-currency-denominated assets are funded with
liability instruments denominated in the same currency. In cases where these
assets are funded in different currencies, forward foreign exchange or
cross-currency swap contracts are used to fully hedge the risk due to this
cross-currency funding.

Quantitative information on derivative financial instruments outstanding
at December 31, 2001 and 2000 are set forth below:

|                                   |  |                 |         |                               |  |                |         |              |  |   |        |   |  |   |         |  
|---------------------------------- |  | --------------- | ------- | ----------------------------- |  | -------------- | ------- | ------------ |  | - | ------ | - |  | - | ------- | -
|                                   |  | Notional amount |         | Balance sheet credit exposure
|                                   |  |                 |         |                              
|                                   |  | December 31,    |         | December 31,                  |  | December 31,   |         | December 31,
|                                   |  | 2001            |         | 2000                          |  | 2001           |         | 2000        
|                                   |  |                 |         |                               |  |                |         |             
|                                   |  |                 |         |                               |  | (in thousands) |         |              |  |  
|Interest rate swap agreements      |  | $               | 196,000 |                               |  | $              | 270,000 |              |  | $ | 2,182  |   |  | $ | 18      |  
|                                  
|                                  
|                                  
|                                  
|Less
set-offs                      |  |                 | 40,000  |                               |  |                | 80,000  |              |  |   | 2,420  |   |  |   | 133     |  
|                                   |  |                 |         |                               |  |                |         |              |  |   |        |   |  |   |         |  
|                                   |  | $               | 156,000 |                               |  | $              | 190,000 |              |  | $ | (238   | ) |  | $ | (115    | )
|                                   |  |                 |         |                               |  |                |         |              |  |   |        |   |  |   |         |  
|Foreign exchange forward contracts |  | $               | 511,565 |                               |  | $              | 441,389 |              |  | $ | 36,779 |   |  | $ | (23,423 | )
|                                  
|                                  
|                                  
|                                  
|Less set-offs                      |  |                 | 61,142  |                               |  |                | 95,461  |              |  |   | (5,593 | ) |  |   | (1,949  | )
|                                   |  |                 |         |                               |  |                |         |              |  |   |        |   |  |   |         |  
|                                   |  | $               | 450,423 |                               |  | $              | 345,928 |              |  | $ | 42,372 |   |  | $ | (21,474 | )
|                                   |  |                 |         |                               |  |                |         |              |  |   |        |   |  |   |         |  

Remaining contracts outstanding at December 31, 2001 with notional
principal amounts less set-offs are as follow:

|                                   |  |              |         |      |  |                |         |      |  |   |         |  |  |   |        | 
|---------------------------------- |  | ------------ | ------- | ---- |  | -------------- | ------- | ---- |  | - | ------- |  |  | - | ------ | 
|                                   |  | December 31,
|                                   |  |             
|                                   |  | 2001         |         | 2002 |  | 2003           |         | 2004
|                                   |  |              |         |      |  |                |         |     
|                                   |  |              |         |      |  | (in thousands) |         |      |  |  
|Interest rate swaps less
set-offs  |  | $            | 156,000 |      |  | $              | 36,000  |      |  | $ | 0       |  |  | $ | 0      | 
|                                   |  |              |         |      |  |                |         |      |  |   |         |  |  |   |        | 
|Foreign exchange forward
contracts |  | $            | 450,423 |      |  | $              | 204,584 |      |  | $ | 126,634 |  |  | $ | 14,098 | 
|                                   |  |              |         |      |  |                |         |      |  |   |         |  |  |   |        | 
|Options                            |  | $            | 100,000 |      |  | $              | 0       |      |  | $ | 0       |  |  | $ | 0      | 
|                                   |  |              |         |      |  |                |         |      |  |   |         |  |  |   |        | 

Interest rate swaps less set-offs, with maturities from May 15, 2002 to
November 17, 2003, are matched to the maturity dates of related Euro
medium-term note issuances and to corresponding assets held to maturity as part
of the Banks credit portfolio.

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Fair Value Disclosure of Financial Instruments

For information regarding fair value disclosure of financial instruments,
see Note 18 of the Notes to the Consolidated Financial Statements.

Accounting and Reporting Development

Impact of SFAS 133 on the Banks Financial Statements

On January 1, 2001, the Bank adopted SFAS 133 and 138 dealing with the
fair market value of all derivative instruments on the balance sheet. As of
January 1, 2001, the fair market valuation of certain options and interest rate
swaps increased earnings by $1 million. As of December 31, 2001, the fair
market valuation of derivatives used in the Banks hedging activities added
$7.4 million to earnings. The Banks capital accounts were negatively impacted
by $0.5 million, relating to the mark-to-market of the cash flow hedges. The
Banks policy is not to engage in hedging activities or maintain derivative
positions other than routine swaps to hedge existing normal currency and
interest rate positions.

The adoption of SFAS 133 affected the cumulative effect of accounting
changes account and the other income account, both of which impacted the
statement of income included in the Consolidated Financial Statements as
follows:

|                                            |                          |       |   |                   |       |                   |   |                     |    |       |   |       |       |  |   |       |       | 
|------------------------------------------- | ------------------------ | ----- | - | ----------------- | ----- | ----------------- | - | ------------------- | -- | ----- | - | ----- | ----- |  | - | ----- | ----- | 
|                                            |                          |       |   | December 31, 2001
|                                            |                          |       |   |                  
|                                            |                          |       |   | Options           |       | Forward Contracts |   | Interest Rate Swaps |    | Total
|                                            |                          |       |   |                   |       |                   |   |                     |    |      
|                                            |                          |       |   |                   |       |                   |   | (in thousands)      |    |       |   |      
|Cumulative effect of accounting changes:    |                          |       |   |                   |       |                   |   |                     |    |       |   |       |       |  |   |      
|                                           
|                                           
|                                           
|                                           
|Transition adjustment (one time Adjustments |                          |       |   |                   |       |                   |   |                     |    |       |   |       |       |  |   |      
|                                           
|                                           
|                                           
|                                           
|                                            | made on January 1, 2001) |       | $ | 1,359             |       |                   | $ | 0                   |    |       | $ | (229  | )     |  | $ | 1,129 |      
|                                           
|                                           
|                                           
|                                           
|Other Income:                               |                          |       |   |                   |       |                   |   |                     |    |       |   |       |       |  |   |      
|                                           
|                                           
|                                           
|                                           
|                                            | Change in fair value of  |       |   |                   |       |                   |   |                     |    |       |   |       |       |  |   |       |      
|                                           
|                                           
|                                           
|                                           
|                                            | derivatives and hedging  |       |   |                   |       |                   |   |                     |    |       |   |       |       |  |   |       |      
|                                           
|                                           
|                                           
|                                           
|                                            | activities               |       | $ | 4,409             |       |                   | $ | 19                  |    |       | $ | 2,952 |       |  | $ | 7,379 |      
|                                            |                          |       |   |                   |       |                   |   |                     |    |       |   |       |       |  |   |      
|                                            |                          | Total |   | $                 | 5,768 |                   |   | $                   | 19 |       |   | $     | 2,723 |  |   | $     | 8,508 | 
|                                            |                          |       |   |                   |       |                   |   |                     |    |       |   |       |       |  |   |      

Also, the adoption of SFAS 133 affected the other comprehensive income
account on the Banks consolidated balance sheet as follows:

|                                                      |                                                   |   |                |      |  
|----------------------------------------------------- | ------------------------------------------------- | - | -------------- | ---- | -
|                                                      |                                                   |   | December 31,  
|                                                      |                                                   |   | 2001          
|                                                      |                                                   |   |               
|                                                      |                                                   |   | (in thousands)
|Other comprehensive income:                           |                                                   |   |                |     
|                                                     
|                                                     
|                                                     
|                                                     
|Transition adjustment related to the transfer of held |                                                   |   |                |     
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | to maturity to available for sale securities upon |   |                |      |  
|                                                     
|                                                     
|                                                     
|                                                     
|                                                      | adoption of SFAS 133                              |   | $              | 421  |  
|                                                     
|                                                     
|                                                     
|                                                     
|Net change in unrealized losses on derivatives        |                                                   | $ | (541           | )   
|                                                      |                                                   |   |                |     
|                                                      | Other comprehensive
loss                          |   | $              | (119 | )
|                                                      |                                                   |   |                |     

The table below lists for each of the years 2001 to 2005 the notional
amounts and weighted interest rates, as of December 31, 2001, for the Banks
investments, borrowings and placements, cross currency swaps and interest rate
swaps.

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|                          |     |                             |                   |        |            |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        |            |       |            |        |           |  | 
|------------------------- | --- | --------------------------- | ----------------- | ------ | ---------- | ----- | ----- | - | --------- | ----- | ----- | - | -------------- | ---- | ----- | - | --------- | ---- | ---- | - | ------ |  | ----- | ------ | ---------- | ----- | ---------- | ------ | --------- |  | 
|                          |     |                             |                   |        | Maturities
|                          |     |                             |                   |        |           
|                          |     |                             |                   |        |            |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        | Total      |       | Fair Value
|                          |     |                             |                   |        | 2001       |       | 2002  |   | 2003      |       | 2004  |   | 2005           |      | 2001  |   | 2001     
|                          |     |                             |                   |        |            |       |       |   |           |       |       |   |                |      |       |   |          
|                          |     |                             |                   |        |            |       |       |   |           |       |       |   | (in thousands) |      |       |   |           |      |      |   |        |  |       |        |           
|Investments               |     |                             |                   |        |            |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        |            |       |            |       
|                         
|                         
|                         
|                         
|Fixed Rate                |     |                             |                   |        |            |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        |            |       |            |       
|                         
|                         
|                         
|                         
|                          |     | US Dollars                  |                   | $      | 158,740    |       |       | $ | 65,643    |       |       | $ | 6,000          |      |       | $ | 13,000    |      |      |   |        |  |       | $      | 243,383    |       |            | $      | 208,662   | 
|                         
|                         
|                         
|                         
|                          |     |                             | 7.03              | %      |            |       | 8.10  | % |           |       | 10.00 | % |                |      | 12.00 | % |           |      |      |   |        |  | 7.66  | %      |            |       | 7.66       | %     
|                         
|                         
|                         
|                         
|                          |     | EUR                         |                   |        |            |       |       |   | 11,719    |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        | 11,719     |       |            |        | 11,719    | 
|                         
|                         
|                         
|                         
|                          |     |                             |                   |        |            |       | 14.25 | % |           |       |       |   |                |      |       |   |           |      |      |   |        |  | 14.25 | %      |            |       | 14.25      | %     
|                         
|                         
|                         
|                         
|                          |     | JPY                         |                   |        |            |       |       |   | 327,470   |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        | 327,470    |       |            |        | 327,470   | 
|                         
|                         
|                         
|                         
|                          |     |                             |                   |        |            |       | 8.20  | % |           |       |       |   |                |      |       |   |           |      |      |   |        |  | 8.20  | %      |            |       | 8.20       | %     
|                         
|                         
|                         
|                         
|Borrowings and Placements |     |                             |                   |        |            |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        |            |       |            |       
|                         
|                         
|                         
|                         
|Fixed Rate                |     |                             |                   |        |            |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        |            |       |            |       
|                         
|                         
|                         
|                         
|                          |     | US Dollars                  |                   |        | 1,990,359  |       |       |   | 78,000    |       |       |   | 15,202         |      |       |   | 21,000    |      |      |   |        |  |       |        | 2,104,561  |       |            |        | 2,104,561 | 
|                         
|                         
|                         
|                         
|                          |     |                             | 3.58              | %      |            |       | 5.93  | % |           |       | 4.16  | % |                |      | 8.05  | % |           |      |      |   |        |  | 3.72  | %      |            |       | 3.72       | %     
|                         
|                         
|                         
|                         
|                          |     | EUR                         |                   |        | 7,000      |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        | 7,000      |       |            |        | 7,000     | 
|                         
|                         
|                         
|                         
|                          |     |                             | 4.80              | %      |            |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  | 4.80  | %      |            |       | 4.80       | %     
|                         
|                         
|                         
|                         
|                          |     | JPY                         |                   |        | 1,000,000  |       |       |   |           |       |       |   | 2,000,000      |      |       |   |           |      |      |   |        |  |       |        | 3,000,000  |       |            |        | 3,000,000 | 
|                         
|                         
|                         
|                         
|                          |     |                             | 1.80              | %      |            |       |       |   |           |       | 4.20  | % |                |      |       |   |           |      |      |   |        |  | 2.52  | %      |            |       | 2.52       | %     
|                         
|                         
|                         
|                         
|                          | CHF |                             |                   | 30,000 |            |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       | 30,000 |            |       |            | 30,000 |          
|                         
|                         
|                         
|                         
|                          |     |                             | 2.52              | %      |            |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  | 2.52  | %      |            |       | 2.52       | %     
|                         
|                         
|                         
|                         
|Variable Rate             |     |                             |                   |        |            |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        |            |       |            |       
|                         
|                         
|                         
|                         
|                          |     | US Dollars                  |                   |        | 532,496    |       |       |   | 696,370   |       |       |   | 226,657        |      |       |   | 31,402    |      |      |   | 19,000 |  |       |        | 1,505,924  |       |            |        | 1,505,924 | 
|                         
|                         
|                         
|                         
|                          |     |                             | 2.99              | %      |            |       | 3.43  | % |           |       | 3.43  | % |                |      | 3.05  | % |           |      | 3.14 | % |        |  | 3.26  | %      |            |       | 3.26       | %     
|                         
|                         
|                         
|                         
|                          |     | JPY                         |                   |        | 3,000,000  |       |       |   | 2,000,000 |       |       |   |                |      |       |   | 1,500,000 |      |      |   |        |  |       |        | 6,500,000  |       |            |        | 6,500,000 | 
|                         
|                         
|                         
|                         
|                          |     |                             | 0.33              | %      |            |       | 0.73  | % |           |       |       |   |                |      | 0.84  | % |           |      |      |   |        |  | 0.57  | %      |            |       | 0.57       | %     
|                         
|                         
|                         
|                         
|                          |     | GBP                         |                   |        | 5,000      |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        | 5,000      |       |            |        | 5,000     | 
|                         
|                         
|                         
|                         
|                          |     |                             | 10.60             | %      |            |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  | 10.60 | %      |            |       | 10.60      | %     
|                         
|                         
|                         
|                         
|Cross Currency Swaps      |     |                             |                   |        |            |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        |            |       |            |       
|                         
|                         
|                         
|                         
|                          |     | Pay EUR fixed/              |                   |        |            |       |       |   | 6,197     |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        | 6,197      |       |            |        |           | 
|                         
|                         
|                         
|                         
|                          |     | Receive US Dollars variable |                   |        |            |       |       |   | 5,765     |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        | 5,765      |       |            |        | 5,639     | 
|                         
|                         
|                         
|                         
|                          |     |                             | EUR fixed rate    |        |            |       |       |   |           | 7.13  | %     |   |                |      |       |   |           |      |      |   |        |  |       |        |            | 7.13  | %          |        |           |  | 
|                         
|                         
|                         
|                         
|                          |     |                             | US variable rate  |        |            |       |       |   |           | 3.53  | %     |   |                |      |       |   |           |      |      |   |        |  |       |        |            | 3.53  | %          |        |           |  | 
|                         
|                         
|                         
|                         
|                          |     | Pay JPY fixed/              |                   |        |            |       |       |   | 325,000   |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        | 325,000    |       |            |        |           | 
|                         
|                         
|                         
|                         
|                          |     | Receive US Dollars fixed    |                   |        |            |       |       |   | 2,993     |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        | 2,993      |       |            |        | 3,730     | 
|                         
|                         
|                         
|                         
|                          |     |                             | JPY fixed rate    |        |            |       |       |   |           | 4.10  | %     |   |                |      |       |   |           |      |      |   |        |  |       |        |            | 4.10  | %          |        |           |  | 
|                         
|                         
|                         
|                         
|                          |     |                             | US fixed rate     |        |            |       |       |   |           | 10.05 | %     |   |                |      |       |   |           |      |      |   |        |  |       |        |            | 10.05 | %          |        |           |  | 
|                         
|                         
|                         
|                         
|                          |     | Pay JPY variable/           |                   |        | 1,609,500  |       |       |   | 7,809,646 |       |       |   | 11,481,400     |      |       |   |           |      |      |   |        |  |       |        | 20,900,546 |       |            |        |           | 
|                         
|                         
|                         
|                         
|                          |     | Receive US Dollars variable |                   |        | 15,000     |       |       |   | 69,192    |       |       |   | 94,936         |      |       |   |           |      |      |   |        |  |       |        | 179,128    |       |            |        | 202,277   | 
|                         
|                         
|                         
|                         
|                          |     |                             | JPY variable rate |        |            | 1.94  | %     |   |           | 2.04  | %     |   |                | 2.26 | %     |   |           |      |      |   |        |  |       |        |            | 2.16  | %          |        |           |  | 
|                         
|                         
|                         
|                         
|                          |     |                             | US variable rate  |        |            | 3.86  | %     |   |           | 4.03  | %     |   |                | 5.55 | %     |   |           |      |      |   |        |  |       |        |            | 4.82  | %          |        |           |  | 
|                         
|                         
|                         
|                         
|                          |     | Pay US Dollars variable/    |                   |        | 6,142      |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        | 6,142      |       |            |        | 5,856     | 
|                         
|                         
|                         
|                         
|                          |     | Receive EUR fixed           |                   |        | 7,000      |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        | 7,000      |       |            |        |           | 
|                         
|                         
|                         
|                         
|                          |     |                             | US variable rate  |        |            | 2.55  | %     |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        |            | 2.55  | %          |        |           |  | 
|                         
|                         
|                         
|                         
|                          |     |                             | EUR fixed rate    |        |            | 0.00  | %     |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        |            | 0.00  | %          |        |           |  | 
|                         
|                         
|                         
|                         
|                          |     | Pay US Dollars variable/    |                   |        | 8,330      |       |       |   |           |       |       |   | 17,600         |      |       |   |           |      |      |   |        |  |       |        | 25,930     |       |            |        | 24,823    | 
|                         
|                         
|                         
|                         
|                          |     | Receive JPY fixed           |                   |        | 1,000,000  |       |       |   |           |       |       |   | 2,000,000      |      |       |   |           |      |      |   |        |  |       |        | 3,000,000  |       |            |        |           | 
|                         
|                         
|                         
|                         
|                          |     |                             | US variable rate  |        |            | 2.82  | %     |   |           |       |       |   |                | 4.16 | %     |   |           |      |      |   |        |  |       |        |            | 3.73  | %          |        |           |  | 
|                         
|                         
|                         
|                         
|                          |     |                             | JPY fixed rate    |        |            | 1.80  | %     |   |           |       |       |   |                | 4.20 | %     |   |           |      |      |   |        |  |       |        |            | 3.40  | %          |        |           |  | 
|                         
|                         
|                         
|                         
|                          |     | Pay US Dollars variable/    |                   |        | 8,165      |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        | 8,165      |       |            |        | 7,106     | 
|                         
|                         
|                         
|                         
|                          |     | Receive GBP variable        |                   |        | 5,000      |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        | 5,000      |       |            |        |           | 
|                         
|                         
|                         
|                         
|                          |     |                             | US variable rate  |        |            | 3.39  | %     |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        |            | 3.39  | %          |        |           |  | 
|                         
|                         
|                         
|                         
|                          |     |                             | GBP variable rate |        |            | 10.60 | %     |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        |            | 10.60 | %          |        |           |  | 
|                         
|                         
|                         
|                         
|                          |     | Pay US Dollars variable/    |                   |        | 24,013     |       |       |   | 19,000    |       |       |   |                |      |       |   | 14,098    |      |      |   |        |  |       |        | 57,111     |       |            |        | 48,865    | 
|                         
|                         
|                         
|                         
|                          |     | Receive JPY variable        |                   |        | 3,000,000  |       |       |   | 2,000,000 |       |       |   |                |      |       |   | 1,500,000 |      |      |   |        |  |       |        | 6,500,000  |       |            |        |           | 
|                         
|                         
|                         
|                         
|                          |     |                             | US variable rate  |        |            | 2.62  | %     |   |           | 3.46  | %     |   |                |      |       |   |           | 3.03 | %    |   |        |  |       |        |            | 3.00  | %          |        |           |  | 
|                         
|                         
|                         
|                         
|                          |     |                             | JPY variable rate |        |            | 0.33  | %     |   |           | 0.73  | %     |   |                |      |       |   |           | 0.84 | %    |   |        |  |       |        |            | 0.57  | %          |        |           |  | 
|                         
|                         
|                         
|                         
|                          |     | Pay                         |                   |        | 0          |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        | 0          |       |            |        |           | 
|                         
|                         
|                         
|                         
|                          |     | Receive US Dollars variable |                   |        | 2,552      |       |       |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        | 2,552      |       |            |        | 2,700     | 
|                         
|                         
|                         
|                         
|                          |     |                             | FIM               |        |            | 0.00  | %     |   |           |       |       |   |                |      |       |   |           |      |      |   |        |  |       |        |            | 0     |            |        |           |  | 

72



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|                     |  |  |                  |   |            |      |        |   |      |  |      |  |                |  |      |  |      |  |  |  |  |  |         |   |       |      |            |  |  |  | 
|-------------------- |  |  | ---------------- | - | ---------- | ---- | ------ | - | ---- |  | ---- |  | -------------- |  | ---- |  | ---- |  |  |  |  |  | ------- | - | ----- | ---- | ---------- |  |  |  | 
|                     |  |  |                  |   | Maturities
|                     |  |  |                  |   |           
|                     |  |  |                  |   |            |      |        |   |      |  |      |  |                |  |      |  |      |  |  |  |  |  |         |   | Total |      | Fair Value
|                     |  |  |                  |   | 2001       |      | 2002   |   | 2003 |  | 2004 |  | 2005           |  | 2001 |  | 2001
|                     |  |  |                  |   |            |      |        |   |      |  |      |  |                |  |      |  |     
|                     |  |  |                  |   |            |      |        |   |      |  |      |  | (in thousands) |  |      |  |      |  |  |  |  |  |         |   |      
|                    
|                    
|                    
|                    
|                     |  |  | US variable rate |   |            | 5.72 | %      |   |      |  |      |  |                |  |      |  |      |  |  |  |  |  |         |   |       | 5.72 | %          |  |  |  | 
|                    
|                    
|                    
|                    
|Interest Rate Swaps  |  |  |                  |   |            |      |        |   |      |  |      |  |                |  |      |  |      |  |  |  |  |  |         |   |       |      |            | 
|                    
|                    
|                    
|                    
|US
Dollars           |  |  |                  |   |            |      |        |   |      |  |      |  |                |  |      |  |      |  |  |  |  |  |         |   |       |      |            | 
|                    
|                    
|                    
|                    
|Variable to fixed    |  |  | 80,000           |   |            |      | 40,000 |   |      |  |      |  |                |  |      |  |      |  |  |  |  |  | 120,000 |   |       |      | 124,980    | 
|                    
|                    
|                    
|                    
|Average pay rate     |  |  | 2.72             | % |            |      | 5.43   | % |      |  |      |  |                |  |      |  |      |  |  |  |  |  | 3.62    | % |       |      |            | 
|                    
|                    
|                    
|                    
|Average receive rate |  |  | 1.52             | % |            |      | 3.04   | % |      |  |      |  |                |  |      |  |      |  |  |  |  |  | 2.03    | % |       |      |            | 
|                    
|                    
|                    
|                    
|Fixed to variable    |  |  | 45,000           |   |            |      | 31,000 |   |      |  |      |  |                |  |      |  |      |  |  |  |  |  | 76,000  |   |       |      | 73,201     | 
|                    
|                    
|                    
|                    
|Average pay rate     |  |  | 7.92             | % |            |      | 5.97   | % |      |  |      |  |                |  |      |  |      |  |  |  |  |  | 7.12    | % |       |      |            | 
|                    
|                    
|                    
|                    
|Average receive rate |  |  | 3.74             | % |            |      | 4.50   | % |      |  |      |  |                |  |      |  |      |  |  |  |  |  | 4.05    | % |       |      |            | 




Item 12. Description of Securities Other than Equity Securities

Not required in this Annual Report.




PART II




Item 13. Defaults, Dividend Arrearages and Delinquencies

None.




Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds

At the 2000 Annual Meeting, shareholders approved the Articles of
Incorporation. In adopting the Amended and Restated Articles of Incorporation,
the shareholders approved three significant changes thereto, including a change
in the capital structure of the Banks shares of common stock. This change
consolidated the Banks Class B and Class C shares into a single class
represented by new Class B shares and made such new Class B shares convertible
at the option of the shareholder, on a share-for-share basis, into the existing
Class E shares, which trade on the New York Stock Exchange. The holders of
Class B shares may at any time, and with no limitation, exchange Class B shares
for Class E shares, at a rate of one (1) Class B share for one (1) Class E
share. When the right of conversion is exercised, the Class B shares being
exchanged will be converted into Class E shares, and the certificates
representing the Class B shares will be cancelled, and in their stead new
certificates representing Class E shares will be issued. The principal
advantage to holders of the Banks Class B shares of converting from Class B
shares to Class E shares is that the holder will own securities for which there
is a more liquid trading market. Class E shares issued in exchange for Class B
shares that have not been outstanding for at least two years will not (unless
they are registered by the Bank under the U.S. Securities Act of 1933, as
amended) be freely tradable on the New York Stock Exchange until the end of a
two-year holding period, which will include the holding period of the Class B
shares for which the new Class E shares are exchanged.

Prior to the approval of the Amended and Restated Articles of
Incorporation at the 2000 Annual Meeting, the holders of the Class C shares and
the Class D shares had the right to convert up to 100% of their Class C shares
or Class D shares into Class E shares at a conversion rate of ten (10) Class C
shares or ten (10) Class D shares to nine (9) Class E shares. While this
conversion program was effective, a total of fourteen holders of Class C shares
converted 1,329,852 Class C shares into 1,149,979 Class E shares. During July
1996, the sole owner of the Banks Class D shares converted 919,833 Class D
shares, equal to all outstanding Class D shares, into 827,847 Class E shares.

In December, 2000, the Board of Directors approved a stock repurchase
program, an increased dividend payout ratio and a plan to declare and pay
dividends on a quarterly basis, rather than annually. Under the repurchase
program, BLADEX may, from time to time, at the discretion of management,
purchase up to an

73



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##### Table of Contents



aggregate of $75,000,000 of Class E shares on the open market at the then
prevailing market price. BLADEX may also make one or more repurchases of up to
an aggregate of $25,000,000 of Class shares in privately negotiated
transactions at the then prevailing market price of the Class E shares. Any
repurchases of Class A shares from a Class A shareholder may not exceed 25% of
the number of shares owned by such Class A shareholder. This program was
halted at the end of 2001.

Under the share repurchase program, the Bank has repurchased through
December 31, 2001 1,750,505 Class E shares and 318,140 Class A shares (which
are not publicly traded) for a total of $70.0 million. During 2001, the Bank
paid cash dividends in the amount of $39.2 million and repurchased common
shares for an aggregate amount of $64.8 million, including the repurchase of
Class A shares for $9.2 million and Class E shares for $55.6 million. As of
the date hereof, no shares of common stock have been repurchased by the Bank in
2002 and no dividends have been declared or paid as the Board of Directors
believes that it is in the best interests of shareholders to conserve the
Banks capital resources (see Risk Factors).




Item 15. (Reserved)




Item 16. (Reserved)




PART III




Item 17. Financial Statements

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




Item 18. Financial Statements

See Item 19.




Item 19. Financial Statements and Exhibits

(a) List of Consolidated Financial Statements

|                                                                                                                                              |  |    
|--------------------------------------------------------------------------------------------------------------------------------------------- |  | ---
|Independent Auditors Report                                                                                                                  |  | F-1
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|Consolidated Balance Sheets at December 31, 2001 and 2000.                                                                                    |  | F-2
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|Consolidated Statements of
Income for each of the Years in the      Three-Year Period Ended
December 31, 2001                                 |  | F-3
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|Consolidated Statements of
Changes in Common Stockholders Equity for
each      of the Years
in the Three-Year Period Ended December 31, 2001 |  | F-4
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|Consolidated Statements of
Other Comprehensive Income
for each of the      Years in the Three-Year Period Ended December 31, 2001             |  | F-5
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|Consolidated Statements of Cash Flows for each of the Years in the      Three-Year Period Ended
December 31, 2001                             |  | F-6
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|Notes to Consolidated Financial Statements                                                                                                    |  | F-7

74



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##### Table of Contents






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 EXPORTACIONES, S.A. | 
|-------------------------------------------- | 



|/s/José Castañeda
José Castañeda | 
|-------------------------------- | 



|Chief Executive Officer | 
|----------------------- | 



|June 30, 2002 | 
|------------- | 

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##### Table of Contents



BANCO LATINOAMERICANO DEEXPORTACIONES,
S. A.AND SUBSIDIARIES

Consolidated Financial Statements

December 31, 2001 and 2000

(With Independent Auditors' Report Thereon)



---



##### Table of Contents



BANCO LATINOAMERICANO DEEXPORTACIONES,
S. A.AND SUBSIDIARIES

TABLE OF CONTENTS



|                                                                                                                                              | 
|--------------------------------------------------------------------------------------------------------------------------------------------- | 
|Independent Auditors Report                                                                                                                  | 
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|                                                                                                                                             
|Consolidated Balance Sheets at
December 31, 2001 and 2000                                                                                     | 
|Consolidated Statements of Income for Each of the Years in the
Three-Year Period
     Ended December 31, 2001                                 | 
|Consolidated Statements of Changes in Common Stockholders'
Equity for Each of the
     Years in the Three-Year Period Ended December 31, 2001 | 
|Consolidated Statements of Other
Comprehensive Income for Each of the Years in the
     Three-Year Period Ended December 31, 2001             | 
|Consolidated Statements of Cash Flows for
Each of the Years in the Three-Year
     Period Ended December 31, 2001                             | 
|Notes to Consolidated Financial
Statements                                                                                                    | 

---



---



##### Table of Contents






INDEPENDENT AUDITORS
REPORT

To the Board of Directors and StockholdersBanco Latinoamericano de Exportaciones, S. A.

We have audited the accompanying consolidated balance sheets of Banco
Latinoamericano de Exportaciones, S. A. and subsidiaries at December 31, 2001
and 2000, and the related consolidated statements of income, changes in common
stockholders equity and cash flows, and other comprehensive income for each of
the years in the three-year period ended December 31, 2001. 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 audits.

We conducted our audits in accordance with generally accepted auditing
standards in the United States of America. 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, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of Banco
Latinoamericano de Exportaciones, S. A. and subsidiaries at December 31, 2001
and 2000, and the results of their operations and their cash flows for each of
the years in the three-year period ended December 31, 2001, in conformity with
generally accepted accounting principles in the United States of America.

As further disclosed in Note 6, the Bank has significant outstanding credit
exposure with Argentine debtors totaling approximately US$1.1 billion at
December 31, 2001. In addition, the Bank has Argentine exposure for US$292
million in securities purchased under agreements to resell, which are secured
with U.S. Treasury securities. Considering the Argentine economic crisis and
political situation, and the great uncertainty as to how or when these
situations will be resolved, repayment problems with the Banks Argentine loans
could have a material adverse effect on the Banks financial condition and
results of operations. The Bank believes it has provided an appropriate level
of allowance for credit losses given the information currently known regarding
this matter, however, the situation of Argentina, over which the Bank has no
control, is changing rapidly. The Bank will continue to monitor developments
in Argentina closely and intends to take appropriate steps as more information
and clarity on the Argentine governments actions, and their resultant impact
on the Banks credit exposure, become available.

As further disclosed in Notes 2(j) and 19, the Bank changed its method of
accounting for derivative instruments and hedging activities effective January
1, 2001.

February 5, 2002
Panama, Republic of Panama

---

F-1



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES




Consolidated Balance Sheets

December 31, 2001 and 2000

---

|                                                |                                        |                                                                                                                 |          |  |      |     |     |  |               |            |               |               |               |            |               |               |             |  | 
|----------------------------------------------- | -------------------------------------- | --------------------------------------------------------------------------------------------------------------- | -------- |  | ---- | --- | --- |  | ------------- | ---------- | ------------- | ------------- | ------------- | ---------- | ------------- | ------------- | ----------- |  | 
|                                                |                                        |                                                                                                                 |          |  | Note |     |     |  |               |            | 2001          |               | 2000         
|                                                |                                        |                                                                                                                 |          |  |      |     |     |  |               |            |               |               |              
|Assets                                          |                                        |                                                                                                                 |          |  |      |     |     |  |               |            |               |               |               |            |               |              
|                                               
|                                               
|                                               
|                                               
|Cash and due from banks                         |                                        |                                                                                                                 | 3        |  |      | US$ |     |  | 1,988,568     |            |               |               | 1,434,547     |           
|                                               
|                                               
|                                               
|                                               
|Interest-bearing deposits with banks            |                                        |                                                                                                                 | 3        |  |      |     |     |  |               |            | 556,682,169   |               |               |            | 312,128,062   |              
|                                               
|                                               
|                                               
|                                               
|Securities purchased under agreements to resell |                                        |                                                                                                                 | 4        |  |      |     |     |  |               |            | 291,871,322   |               |               |            | 0             |              
|                                               
|                                               
|                                               
|                                               
|Investment securities                           |                                        |                                                                                                                 | 5        |  |      |     |     |  |               |            | 362,098,271   |               |               |            | 395,458,879   |              
|                                               
|                                               
|                                               
|                                               
|Loans                                           |                                        |                                                                                                                 | 3,6      |  |      |     |     |  |               |            | 4,733,709,698 |               |               |            | 4,927,465,068 |              
|                                               
|                                               
|                                               
|                                               
|                                                | Less:                                  |                                                                                                                 |          |  |      |     |     |  |               |            |               |               |               |            |               |               |            
|                                               
|                                               
|                                               
|                                               
|                                                |                                        | Allowance for loan losses                                                                                       |          |  | 7    |     |     |  |               |            |               |               | 177,483,648   |            |               |               | 110,387,682 | 
|                                               
|                                               
|                                               
|                                               
|                                                |                                        | Unearned income                                                                                                 |          |  |      |     |     |  |               |            |               |               | 20,120,613    |            |               |               | 10,685,511  | 
|                                                |                                        |                                                                                                                 |          |  |      |     |     |  |               |            |               |               |               |            |               |              
|Loans, net                                      |                                        |                                                                                                                 |          |  |      |     |     |  |               |            | 4,536,105,437 |               |               |            | 4,806,391,875 |              
|                                                |                                        |                                                                                                                 |          |  |      |     |     |  |               |            |               |               |               |            |               |              
|Customers liabilities under acceptances        |                                        |                                                                                                                 | 3        |  |      |     |     |  |               |            | 31,888,487    |               |               |            | 7,420,027     |              
|                                               
|                                               
|                                               
|                                               
|Premises and equipment                          |                                        |                                                                                                                 | 8        |  |      |     |     |  |               |            | 5,477,781     |               |               |            | 4,501,458     |              
|                                               
|                                               
|                                               
|                                               
|Accrued interest receivable                     |                                        |                                                                                                                 | 3        |  |      |     |     |  |               |            | 74,400,106    |               |               |            | 102,151,506   |              
|                                               
|                                               
|                                               
|                                               
|Other assets                                    |                                        |                                                                                                                 |          |  |      |     |     |  |               |            | 64,923,605    |               |               |            | 31,195,190    |              
|                                                |                                        |                                                                                                                 |          |  |      |     |     |  |               |            |               |               |               |            |               |              
|Total assets                                    |                                        |                                                                                                                 |          |  |      | US$ |     |  | 5,925,435,746 |            |               |               | 5,660,681,544 |           
|                                                |                                        |                                                                                                                 |          |  |      |     |     |  |               |            |               |               |               |            |               |              
|Liabilities and Stockholders Equity            |                                        |                                                                                                                 |          |  |      |     |     |  |               |            |               |               |               |            |               |              
|                                               
|                                               
|                                               
|                                               
|Deposits:                                       |                                        |                                                                                                                 | 3,9      |  |      |     |     |  |               |            |               |               |               |            |               |              
|                                               
|                                               
|                                               
|                                               
|                                                | Demand                                 |                                                                                                                 |          |  |      |     | US$ |  |               | 71,096,235 |               |               |               | 44,824,273 |              
|                                               
|                                               
|                                               
|                                               
|                                                | Time                                   |                                                                                                                 |          |  |      |     |     |  |               |            |               | 1,500,263,004 |               |            |               | 1,699,017,473 |            
|                                                |                                        |                                                                                                                 |          |  |      |     |     |  |               |            |               |               |               |            |               |              
|Total deposits                                  |                                        |                                                                                                                 |          |  |      |     |     |  |               |            | 1,571,359,239 |               |               |            | 1,743,841,746 |              
|                                                |                                        |                                                                                                                 |          |  |      |     |     |  |               |            |               |               |               |            |               |              
|Short-term borrowings and placements            |                                        |                                                                                                                 | 3,10     |  |      |     |     |  |               |            | 1,823,323,628 |               |               |            | 1,509,880,207 |              
|                                               
|                                               
|                                               
|                                               
|Medium and long-term borrowings and placements  |                                        |                                                                                                                 | 3,11     |  |      |     |     |  |               |            | 1,787,161,319 |               |               |            | 1,582,479,486 |              
|                                               
|                                               
|                                               
|                                               
|Acceptances outstanding                         |                                        |                                                                                                                 | 3        |  |      |     |     |  |               |            | 31,888,487    |               |               |            | 7,420,027     |              
|                                               
|                                               
|                                               
|                                               
|Accrued interest payable                        |                                        |                                                                                                                 | 3        |  |      |     |     |  |               |            | 39,893,537    |               |               |            | 60,467,093    |              
|                                               
|                                               
|                                               
|                                               
|Other liabilities                               |                                        |                                                                                                                 | 7        |  |      |     |     |  |               |            | 58,159,298    |               |               |            | 41,577,802    |              
|                                                |                                        |                                                                                                                 |          |  |      |     |     |  |               |            |               |               |               |            |               |              
|Total liabilities                               |                                        |                                                                                                                 |          |  |      |     |     |  |               |            | 5,311,785,508 |               |               |            | 4,945,666,361 |              
|                                                |                                        |                                                                                                                 |          |  |      |     |     |  |               |            |               |               |               |            |               |              
|Redeemable preferred stock                      |                                        |                                                                                                                 | 12       |  |      |     |     |  |               |            | 15,231,960    |               |               |            | 15,810,380    |              
|                                               
|                                               
|                                               
|                                               
|Common stockholders equity:                    |                                        |                                                                                                                 | 3,13,14  |  |      |     |     |  |               |            |               |               |               |            |               |              
|                                               
|                                               
|                                               
|                                               
|                                                | Class A, common stock, no par value  |                                                                                                                 |          |  |      |     |     |  |               |            |               | 34,862,304    |               |            |               | 34,862,304    |            
|                                                |                                        | (Authorized 20,000,000 class A common shares; issued and
outstanding 4,911,185 in 2001 and 5,181,028 in 2000) |          |  |      |     |     |  |               |            |               |               |               |            |               |               |             | 
|                                               
|                                               
|                                               
|                                               
|                                                | Class B, common stock, no par value  |                                                                                                                 |          |  |      |     |     |  |               |            |               | 32,102,371    |               |            |               | 33,910,342    |            
|                                                |                                        | (Authorized 20,000,000 class B common shares; issued and
outstanding 4,247,213 in 2001 and 4,518,410 in 2000) |          |  |      |     |     |  |               |            |               |               |               |            |               |               |             | 
|                                               
|                                               
|                                               
|                                               
|                                                | Class E , common stock, no par value |                                                                                                                 |          |  |      |     |     |  |               |            |               | 66,252,743    |               |            |               | 64,078,522    |            
|                                                |                                        | (Authorized 30,000,000 class E common shares; issued and
outstanding 8,182,440 in 2001 and 9,489,680 in 2000) |          |  |      |     |     |  |               |            |               |               |               |            |               |               |             | 
|                                               
|                                               
|                                               
|                                               
|                                                | Treasury stock                         |                                                                                                                 |          |  |      |     |     |  |               |            |               | (85,633,707   | )             |            |               | (20,840,896   | )          
|                                               
|                                               
|                                               
|                                               
|                                                | Capital surplus                        |                                                                                                                 |          |  |      |     |     |  |               |            |               | 145,456,320   |               |            |               | 144,522,184   |            
|                                               
|                                               
|                                               
|                                               
|                                                | Capital reserves                       |                                                                                                                 |          |  |      |     |     |  |               |            |               | 305,210,154   |               |            |               | 305,210,154   |            
|                                               
|                                               
|                                               
|                                               
|                                                | Other comprehensive income             |                                                                                                                 |          |  |      |     |     |  |               |            |               | (506,280      | )             |            |               | 0             |            
|                                               
|                                               
|                                               
|                                               
|                                                | Retained earnings                      |                                                                                                                 |          |  |      |     |     |  |               |            |               | 100,674,373   |               |            |               | 137,462,193   |            
|                                                |                                        |                                                                                                                 |          |  |      |     |     |  |               |            |               |               |               |            |               |              
|Total common stockholders equity               |                                        |                                                                                                                 |          |  |      |     |     |  |               |            | 598,418,278   |               |               |            | 699,204,803   |              
|                                                |                                        |                                                                                                                 |          |  |      |     |     |  |               |            |               |               |               |            |               |              
|Commitments and contingent liabilities          |                                        |                                                                                                                 | 16,17,21 |  |      |     |     |  |               |            |               |               |               |            |               |              
|                                               
|                                               
|                                               
|                                               
|Total liabilities and stockholders equity      |                                        |                                                                                                                 |          |  |      | US$ |     |  | 5,925,435,746 |            |               |               | 5,660,681,544 |           
|                                                |                                        |                                                                                                                 |          |  |      |     |     |  |               |            |               |               |               |            |               |              

See accompanying notes to consolidated financial
statements.

---

F-2



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES




Consolidated Statements of Income

For Each of the Years in the Three-Year Period Ended December 31, 2001

---

|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |             |  
|--------------------------------------------------------------------------------------------------------- | ------------------------------------------------------ |  | ---- | ---- |  | --- | --- |  | --------- | ---------- | ----------- | ----------- | ---------- | ---------- | ----------- | ----------- | ----------- | ---------- | ----------- | ----------- | -
|                                                                                                          |                                                        |  | Note |      |  |     |     |  | 2001      |            | 2000        |             | 1999      
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |           
|Interest income:                                                                                          |                                                        |  | 3    |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                          | Deposits with banks                                    |  |      |      |  |     | US$ |  |           | 14,259,442 |             |             |            | 17,961,773 |             |             |             | 14,158,460 |            
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                          | Investment securities                                  |  |      |      |  |     |     |  |           |            |             | 33,856,732  |            |            |             | 26,401,056  |             |            |             | 11,236,548  |  
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                          | Loans                                                  |  |      |      |  |     |     |  |           |            |             | 330,337,606 |            |            |             | 358,222,947 |             |            |             | 343,538,468 |  
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|Total interest income                                                                                     |                                                        |  |      |      |  |     |     |  |           |            | 378,453,780 |             |            |            | 402,585,776 |             |             |            | 368,933,476 |            
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|Interest expense:                                                                                         |                                                        |  | 3,9  |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                          | Deposits                                               |  |      |      |  |     |     |  |           |            |             | 74,522,455  |            |            |             | 108,682,349 |             |            |             | 79,313,363  |  
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                          | Short-term borrowings and placements                   |  |      |      |  |     |     |  |           |            |             | 89,357,367  |            |            |             | 87,237,790  |             |            |             | 100,462,153 |  
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                          | Medium and long-term borrowings and placements         |  |      |      |  |     |     |  |           |            |             | 95,802,927  |            |            |             | 93,995,752  |             |            |             | 76,460,163  |  
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|Total interest expense                                                                                    |                                                        |  |      |      |  |     |     |  |           |            | 259,682,749 |             |            |            | 289,915,891 |             |             |            | 256,235,679 |            
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|Net interest income                                                                                       |                                                        |  |      |      |  |     |     |  |           |            | 118,771,031 |             |            |            | 112,669,885 |             |             |            | 112,697,797 |            
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|Provision for loan losses                                                                                 |                                                        |  | 7    |      |  |     |     |  |           |            | 77,144,445  |             |            |            | 8,000,000   |             |             |            | 14,700,000  |            
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|Net interest income after provision
for loan losses                                                       |                                                        |  |      |      |  |     |     |  |           |            | 41,626,586  |             |            |            | 104,669,885 |             |             |            | 97,997,797  |            
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|Other income (expense):                                                                                   |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                          | Commission income                                      |  |      |      |  |     |     |  |           |            |             | 14,934,134  |            |            |             | 25,878,111  |             |            |             | 26,489,422  |  
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                          | Commission expense and other charges                   |  |      |      |  |     |     |  |           |            |             | (1,243,171  | )          |            |             | (1,136,430  | )           |            |             | (1,009,368  | )
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                          | Provision for losses on off balance sheet
credit risks |  |      | 7    |  |     |     |  |           |            |             | 0           |            |            |             | (11,200,000 | )           |            |             | (6,000,000  | )
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                          | Derivates and hedging activities                       |  |      | 19   |  |     |     |  |           |            |             | 7,378,770   |            |            |             | 0           |             |            |             | 0           |  
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                          | Impairment loss on securities                          |  |      | 4    |  |     |     |  |           |            |             | (40,355,555 | )          |            |             | 0           |             |            |             | 0           |  
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                          | Gain on sale of securities available for sale          |  |      |      |  |     |     |  |           |            |             | 4,798,368   |            |            |             | 0           |             |            |             | 0           |  
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                          | Other income                                           |  |      | 6    |  |     |     |  |           |            |             | 653,844     |            |            |             | 88,774      |             |            |             | 193,529     |  
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|Net other income (expense)                                                                                |                                                        |  |      |      |  |     |     |  |           |            | (13,833,610 | )           |            |            | 13,630,455  |             |             |            | 19,673,583  |            
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|Operating expenses:                                                                                       |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                          | Salaries and other employee expenses                   |  |      | 14   |  |     |     |  |           |            |             | 11,806,915  |            |            |             | 10,641,962  |             |            |             | 9,607,665   |  
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                          | Pre-operating costs                                    |  |      |      |  |     |     |  |           |            |             | 2,966,955   |            |            |             | 925,108     |             |            |             | 0           |  
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                          | Other operating expenses                               |  |      | 8,21 |  |     |     |  |           |            |             | 11,619,822  |            |            |             | 9,612,716   |             |            |             | 6,970,318   |  
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|Total operating expenses                                                                                  |                                                        |  |      |      |  |     |     |  |           |            | 26,393,692  |             |            |            | 21,179,786  |             |             |            | 16,577,983  |            
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|Net income before income tax and
cumulative effect of accounting change                                   |                                                        |  |      |      |  |     |     |  |           |            | 1,399,284   |             |            |            | 97,120,554  |             |             |            | 101,093,397 |            
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|Income tax                                                                                                |                                                        |  | 2    |      |  |     |     |  |           |            | 35,000      |             |            |            | 65,000      |             |             |            | 36,000      |            
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|Net income before cumulative effect of
accounting change                                                  |                                                        |  |      |      |  |     |     |  |           |            | 1,364,284   |             |            |            | 97,055,554  |             |             |            | 101,057,397 |            
|                                                                                                         
|                                                                                                         
|                                                                                                         
|                                                                                                         
|Cumulative effect of accounting change                                                                    |                                                        |  | 19   |      |  |     |     |  |           |            | 1,129,413   |             |            |            | 0           |             |             |            | 0           |            
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|Net income                                                                                                |                                                        |  | 15   |      |  | US$ |     |  | 2,493,697 |            |             |             | 97,055,554 |            |             |             | 101,057,397 |           
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|Earnings per share (after dividends on
preferred stock and before cumulative
effect of accounting change) |                                                        |  | 15   |      |  | US$ |     |  | 0.00      |            |             |             | 4.83       |            |             |             | 4.95        |           
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|Diluted earnings per share (before
cumulative effect of accounting change)                                |                                                        |  | 15   |      |  | US$ |     |  | 0.00      |            |             |             | 4.81       |            |             |             | 4.93        |           
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|Earnings per share (after dividends on
preferred stock and after cumulative
effect of accounting change)  |                                                        |  | 15   |      |  | US$ |     |  | 0.06      |            |             |             | 4.83       |            |             |             | 4.95        |           
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            
|Diluted earnings per share (after
cumulative effect of accounting change)                                 |                                                        |  | 15   |      |  | US$ |     |  | 0.06      |            |             |             | 4.81       |            |             |             | 4.93        |           
|                                                                                                          |                                                        |  |      |      |  |     |     |  |           |            |             |             |            |            |             |             |             |            |             |            

See accompanying notes to consolidated financial
statements.

---

F-3



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES




Consolidated Statements of Changes in Common Stockholders Equity

For Each of the Years in the Three -Year Period Ended December 31, 2001

---

|                                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |             |             |  
|--------------------------------------- | ---------------------------------------------------------------- | ---------------- | --- |  |  | ----------- | - | ----------- | ----------- | ----------- | - | ----------- | ----------- | ----------- |  | ----------- | ----------- | -
|                                        |                                                                  |                  |     |  |  |             |   | 2001        |             | 2000        |   | 1999       
|                                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |            
|Common stock:                           |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|                                       
|                                       
|                                       
|                                       
|                                        | Balance at beginning of the year                                 |                  | US$ |  |  | 132,851,168 |   |             |             | 132,848,420 |   |             |             | 134,803,109 | 
|                                       
|                                       
|                                       
|                                       
|                                        | Issuance of common shares                                        |                  |     |  |  |             |   | 26,882      |             |             |   | 60,898      |             |             |  | 177,316     |            
|                                       
|                                       
|                                       
|                                       
|                                        | Difference in conversion of common shares                        |                  |     |  |  |             |   | 931         |             |             |   | 0           |             |             |  | (97,675     | )          
|                                       
|                                       
|                                       
|                                       
|                                        | Retirement of Class B common shares                            |                  |     |  |  |             |   | 0           |             |             |   | (58,150     | )           |             |  | (2,034,330  | )          
|                                       
|                                       
|                                       
|                                       
|                                        | Stock option plan                                                |                  |     |  |  |             |   | 338,437     |             |             |   | 0           |             |             |  | 0           |            
|                                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|                                        | Balance at end of the year                                       |                  | US$ |  |  | 133,217,418 |   |             |             | 132,851,168 |   |             |             | 132,848,420 | 
|                                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|Treasury stock:                         |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|                                       
|                                       
|                                       
|                                       
|                                        | Balance at beginning of the year                                 |                  | US$ |  |  | (20,840,896 | ) |             |             | 0           |   |             |             | 0           | 
|                                       
|                                       
|                                       
|                                       
|                                        | Purchase of Class A common shares                              |                  |     |  |  |             |   | (9,222,576  | )           |             |   | (1,485,144  | )           |             |  | 0           |            
|                                       
|                                       
|                                       
|                                       
|                                        | Purchase of Class B common shares                              |                  |     |  |  |             |   | 0           |             |             |   | (15,655,231 | )           |             |  | 0           |            
|                                       
|                                       
|                                       
|                                       
|                                        | Purchase of Class E common shares                              |                  |     |  |  |             |   | (55,570,235 | )           |             |   | (3,700,521  | )           |             |  | 0           |            
|                                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|                                        | Balance at end of the year                                       |                  | US$ |  |  | (85,633,707 | ) |             |             | (20,840,896 | ) |             |             | 0           | 
|                                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|Capital surplus:                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|                                       
|                                       
|                                       
|                                       
|                                        | Balance at beginning of the year                                 |                  | US$ |  |  | 144,522,184 |   |             |             | 144,361,894 |   |             |             | 144,040,400 | 
|                                       
|                                       
|                                       
|                                       
|                                        | Issuance of common shares                                        |                  |     |  |  |             |   | 103,482     |             |             |   | 170,890     |             |             |  | 326,784     |            
|                                       
|                                       
|                                       
|                                       
|                                        | Difference in conversion of common shares                        |                  |     |  |  |             |   | (784        | )           |             |   | 0           |             |             |  | 97,668      |            
|                                       
|                                       
|                                       
|                                       
|                                        | Retirement of Class B common shares                            |                  |     |  |  |             |   | 0           |             |             |   | (10,600     | )           |             |  | (102,958    | )          
|                                       
|                                       
|                                       
|                                       
|                                        | Stock option plan                                                |                  |     |  |  |             |   | 831,438     |             |             |   | 0           |             |             |  | 0           |            
|                                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|                                        | Balance at end of the year                                       |                  | US$ |  |  | 145,456,320 |   |             |             | 144,522,184 |   |             |             | 144,361,894 | 
|                                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|Capital reserves:                       |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|                                       
|                                       
|                                       
|                                       
|                                        | Balance at beginning of the year                                 |                  | US$ |  |  | 305,210,154 |   |             |             | 305,210,154 |   |             |             | 256,516,711 | 
|                                       
|                                       
|                                       
|                                       
|                                        | Transfer from retained earnings                                  |                  |     |  |  |             |   | 0           |             |             |   | 0           |             |             |  | 48,693,443  |            
|                                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|                                        | Balance at end of the year                                       |                  | US$ |  |  | 305,210,154 |   |             |             | 305,210,154 |   |             |             | 305,210,154 | 
|                                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|Accumulated other comprehensive income: |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|                                       
|                                       
|                                       
|                                       
|                                        | Balance at beginning of the year                                 |                  | US$ |  |  | 0           |   |             |             | 0           |   |             |             | 0           | 
|                                       
|                                       
|                                       
|                                       
|                                        | Transition adjustment for the adoption of SFAS 133               |                  |     |  |  |             |   | 421,421     |             |             |   | 0           |             |             |  | 0           |            
|                                       
|                                       
|                                       
|                                       
|                                        | Net change in unrealized losses on securities
available for sale |                  |     |  |  |             |   | (387,005    | )           |             |   | 0           |             |             |  | 0           |            
|                                       
|                                       
|                                       
|                                       
|                                        | Net change in unrealized losses on derivatives                   |                  |     |  |  |             |   | (540,696    | )           |             |   | 0           |             |             |  | 0           |            
|                                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|                                        | Balance at end of the year                                       |                  | US$ |  |  | (506,280    | ) |             |             | 0           |   |             |             | 0           | 
|                                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|Retained earnings:                      |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|                                       
|                                       
|                                       
|                                       
|                                        | Balance at beginning of the year                                 |                  | US$ |  |  | 137,462,193 |   |             |             | 98,008,570  |   |             |             | 71,146,252  | 
|                                       
|                                       
|                                       
|                                       
|                                        | Net income                                                       |                  |     |  |  |             |   | 2,493,697   |             |             |   | 97,055,554  |             |             |  | 101,057,397 |            
|                                       
|                                       
|                                       
|                                       
|                                        | Cash dividends paid on:                                          |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |             |            
|                                       
|                                       
|                                       
|                                       
|                                        |                                                                  | Preferred shares |     |  |  |             |   |             | (5,150,693  | )           |   |             | (7,533,303  | )           |  |             | (3,045,133  | )
|                                       
|                                       
|                                       
|                                       
|                                        |                                                                  | Common shares    |     |  |  |             |   |             | (34,010,105 | )           |   |             | (49,775,765 | )           |  |             | (19,407,676 | )
|                                       
|                                       
|                                       
|                                       
|                                        | Retirement of Class B common shares                            |                  |     |  |  |             |   | 0           |             |             |   | (97,852     | )           |             |  | (3,048,827  | )          
|                                       
|                                       
|                                       
|                                       
|                                        | Purchase of preferred shares                                     |                  |     |  |  |             |   | (120,453    | )           |             |   | (195,012    | )           |             |  | 0           |            
|                                       
|                                       
|                                       
|                                       
|                                        | Earnings transferred to capital reserves                         |                  |     |  |  |             |   | 0           |             |             |   | 0           |             |             |  | (48,693,443 | )          
|                                       
|                                       
|                                       
|                                       
|                                        | Difference in conversion of common shares                        |                  |     |  |  |             |   | (266        | )           |             |   | 0           |             |             |  | 0           |            
|                                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|                                        | Balance at end of the year                                       |                  | US$ |  |  | 100,674,373 |   |             |             | 137,462,193 |   |             |             | 98,008,570  | 
|                                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|                                        | Balance at beginning of the year                                 |                  | US$ |  |  | 699,204,803 |   |             |             | 680,429,038 |   |             |             | 606,506,472 | 
|                                       
|                                       
|                                       
|                                       
|                                        | Changes during the year, net                                     |                  |     |  |  |             |   | 100,786,525 | )           |             |   | 18,775,765  |             |             |  | 73,922,566  |            
|                                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            
|                                        | Balance at end of the year                                       |                  | US$ |  |  | 598,418,278 |   |             |             | 699,204,803 |   |             |             | 680,429,038 | 
|                                        |                                                                  |                  |     |  |  |             |   |             |             |             |   |             |             |             |  |            

See accompanying notes to consolidated financial
statements.

---

F-4



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES




Consolidated Statements of Other Comprehensive Income

For Each of the Years in the Three-Year Period Ended December 31, 2001

---

|                                                                                       |  |     |  |  |           |      |          |      |            |      |   |  |             |  |   | 
|-------------------------------------------------------------------------------------- |  | --- |  |  | --------- | ---- | -------- | ---- | ---------- | ---- | - |  | ----------- |  | - | 
|                                                                                       |  |     |  |  |           | 2001 |          | 2000 |            | 1999
|                                                                                       |  |     |  |  |           |      |          |      |            |     
|Net income                                                                             |  | US$ |  |  | 2,493,697 |      |          |      | 97,055,554 |      |   |  | 101,057,397 | 
|                                                                                      
|                                                                                      
|                                                                                      
|                                                                                      
|Other comprehensive income:                                                            |  |     |  |  |           |      |          |      |            |      |   |  |             |  |   | 
|                                                                                      
|                                                                                      
|                                                                                      
|                                                                                      
|Adjustments related to transfer from securities held
to maturity to available for sale |  |     |  |  |           |      | 421,421  |      |            |      | 0 |  |             |  | 0 | 
|                                                                                      
|                                                                                      
|                                                                                      
|                                                                                      
|Net change in unrealized losses on securities
available for sale                       |  |     |  |  |           |      | (387,005 | )    |            |      | 0 |  |             |  | 0 | 
|                                                                                      
|                                                                                      
|                                                                                      
|                                                                                      
|Net change in unrealized losses on derivatives                                         |  |     |  |  |           |      | (540,696 | )    |            |      | 0 |  |             |  | 0 | 
|                                                                                       |  |     |  |  |           |      |          |      |            |      |   |  |             |  |   | 
|Other comprehensive loss                                                               |  |     |  |  |           |      | (506,280 | )    |            |      | 0 |  |             |  | 0 | 
|                                                                                       |  |     |  |  |           |      |          |      |            |      |   |  |             |  |   | 
|Comprehensive income                                                                   |  | US$ |  |  | 1,987,417 |      |          |      | 97,055,554 |      |   |  | 101,057,397 | 
|                                                                                       |  |     |  |  |           |      |          |      |            |      |   |  |             |  |   | 

See accompanying notes to consolidated financial
statements.

---

F-5



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES




Consolidated Statements of Cash Flows

For Each of the Years in the Three-Year Period Ended December 31, 2001

---

|                                                   |                                                                                                             |                                                        |                                                     |  |             |             |             |                |             |             |             |                |             |              |             |                |             |              |  
|-------------------------------------------------- | ----------------------------------------------------------------------------------------------------------- | ------------------------------------------------------ | --------------------------------------------------- |  | ----------- | ----------- | ----------- | -------------- | ----------- | ----------- | ----------- | -------------- | ----------- | ------------ | ----------- | -------------- | ----------- | ------------ | -
|                                                   |                                                                                                             |                                                        |                                                     |  |             |             |             |                | 2001        |             | 2000        |                | 1999       
|                                                   |                                                                                                             |                                                        |                                                     |  |             |             |             |                |             |             |             |                |            
|Cash flows from operating activities:              |                                                                                                             |                                                        |                                                     |  |             |             |             |                |             |             |             |                |             |              |             |               
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Net income                                                                                                  |                                                        | US$                                                 |  |             | 2,493,697   |             |                |             | 97,055,554  |             |                |             | 101,057,397  |            
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Adjustments to reconcile net income to net
cash provided by operating activities:                           |                                                        |                                                     |  |             |             |             |                |             |             |             |                |             |              |             |                |            
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   |                                                                                                             | Derivatives and hedging activities                     |                                                     |  |             |             |             |                | (8,508,183  | )           |             |                | 0           |              |             |                | 0           |             
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   |                                                                                                             | Depreciation of premises and equipment                 |                                                     |  |             |             |             |                | 1,194,768   |             |             |                | 1,141,924   |              |             |                | 1,084,720   |             
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   |                                                                                                             | Provision for loan losses                              |                                                     |  |             |             |             |                | 77,144,445  |             |             |                | 8,000,000   |              |             |                | 14,700,000  |             
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   |                                                                                                             | Impairment loss on securities                          |                                                     |  |             |             |             |                | 40,355,555  |             |             |                | 0           |              |             |                | 0           |             
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   |                                                                                                             | Provision for losses on off balance sheet
credit risks |                                                     |  |             |             |             |                | 0           |             |             |                | 11,200,000  |              |             |                | 6,000,000   |             
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   |                                                                                                             | Gain on sale of securities available for sale          |                                                     |  |             |             |             |                | (4,798,368  | )           |             |                | 0           |              |             |                | 0           |             
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   |                                                                                                             | Net decrease (increase) in accrued interest
receivable |                                                     |  |             |             |             |                | 27,751,400  |             |             |                | 1,724,560   |              |             |                | (16,044,607 | )           
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   |                                                                                                             | Net (increase) decrease in other assets                |                                                     |  |             |             |             |                | (33,728,415 | )           |             |                | (22,595,264 | )            |             |                | (2,004,349  | )           
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   |                                                                                                             | Net (decrease) increase in accrued interest
payable    |                                                     |  |             |             |             |                | (20,573,556 | )           |             |                | 11,958,776  |              |             |                | 1,610,935   |             
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   |                                                                                                             | Net increase (decrease) in other liabilities           |                                                     |  |             |             |             |                | 24,548,983  |             |             |                | (14,117,815 | )            |             |                | (16,527,902 | )           
|                                                   |                                                                                                             |                                                        |                                                     |  |             |             |             |                |             |             |             |                |             |              |             |               
|                                                   |                                                                                                             |                                                        | Net cash provided by operating activities           |  |             |             |             |                |             | 105,880,326 |             |                |             | 94,367,735   |             |                |             | 89,876,194   |  
|                                                   |                                                                                                             |                                                        |                                                     |  |             |             |             |                |             |             |             |                |             |              |             |               
|Cash flows from investing activities:              |                                                                                                             |                                                        |                                                     |  |             |             |             |                |             |             |             |                |             |              |             |               
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Net decrease (increase) in loans                                                                            |                                                        |                                                     |  |             |             |             | 193,141,993    |             |             |             | (357,125,939   | )           |              |             | 512,431,055    |            
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Net acquisition of premises and equipment                                                                   |                                                        |                                                     |  |             |             |             | (2,171,091     | )           |             |             | (736,278       | )           |              |             | (1,191,275     | )          
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Proceeds from the redemption of securities                                                                  |                                                        |                                                     |  |             |             |             | 106,033,989    |             |             |             | 85,166,890     |             |              |             | 36,468,260     |            
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Proceeds from the sell of securities                                                                        |                                                        |                                                     |  |             |             |             | 84,634,197     |             |             |             | 0              |             |              |             | 0              |            
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Acquisition of securities                                                                                   |                                                        |                                                     |  |             |             |             | (226,465,025   | )           |             |             | (174,098,615   | )           |              |             | (52,887,500    | )          
|                                                   |                                                                                                             |                                                        |                                                     |  |             |             |             |                |             |             |             |                |             |              |             |               
|                                                   |                                                                                                             |                                                        | Net cash provided by (used in) investing
activities |  |             |             |             |                |             | 155,174,063 |             |                |             | (446,793,942 | )           |                |             | 494,820,540  |  
|                                                   |                                                                                                             |                                                        |                                                     |  |             |             |             |                |             |             |             |                |             |              |             |               
|Cash flows from financing activities:              |                                                                                                             |                                                        |                                                     |  |             |             |             |                |             |             |             |                |             |              |             |               
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Net (decrease) increase in due to depositors                                                                |                                                        |                                                     |  |             |             |             | (172,482,507   | )           |             |             | 126,667,557    |             |              |             | (88,822,717    | )          
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Net increase (decrease) in short-term borrowings
and placements with original maturity of less than 90 days |                                                        |                                                     |  |             |             |             | 243,434,696    |             |             |             | 71,401,629     |             |              |             | (135,600,000   | )          
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Proceeds from short-term borrowings and placements
with original maturity greater than 90 days              |                                                        |                                                     |  |             |             |             | 2,115,902,432  |             |             |             | 2,490,454,764  |             |              |             | 2,961,819,368  |            
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Repayments of short-term borrowings and placements
with original maturity greater than 90 days              |                                                        |                                                     |  |             |             |             | (2,045,893,707 | )           |             |             | (2,572,946,969 | )           |              |             | (3,188,877,114 | )          
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Proceeds from medium and long-term borrowings and
placements with original maturity greater than 90 days    |                                                        |                                                     |  |             |             |             | 433,828,316    |             |             |             | 826,333,958    |             |              |             | 365,348,489    |            
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Repayments of medium and long-term borrowings and
placements with original maturity greater than 90 days    |                                                        |                                                     |  |             |             |             | (229,146,483   | )           |             |             | (456,421,020   | )           |              |             | (422,379,595   | )          
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Cash dividends paid                                                                                         |                                                        |                                                     |  |             |             |             | (39,160,798    | )           |             |             | (57,309,068    | )           |              |             | (22,452,809    | )          
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Proceeds from issuance of common stock                                                                      |                                                        |                                                     |  |             |             |             | 366,250        |             |             |             | 62,215         |             |              |             | 177,316        |            
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Repurchase of preferred stock                                                                               |                                                        |                                                     |  |             |             |             | (699,139       | )           |             |             | (1,083,420     | )           |              |             | (326,750       | )          
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Repurchase of common shares                                                                                 |                                                        |                                                     |  |             |             |             | (64,792,811    | )           |             |             | (21,203,827    | )           |              |             | (5,186,122     | )          
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Capital surplus paid in excess of stated value of
common stock issued                                       |                                                        |                                                     |  |             |             |             | 934,136        |             |             |             | 170,891        |             |              |             | 326,784        |            
|                                                   |                                                                                                             |                                                        |                                                     |  |             |             |             |                |             |             |             |                |             |              |             |               
|                                                   |                                                                                                             |                                                        | Net cash (used in) provided by financing
activities |  |             |             |             |                |             | 242,290,385 |             |                |             | 406,126,710  |             |                |             | (535,973,150 | )
|                                                   |                                                                                                             |                                                        |                                                     |  |             |             |             |                |             |             |             |                |             |              |             |               
|Net increase in cash and cash equivalents          |                                                                                                             |                                                        |                                                     |  |             |             | 503,344,774 |                |             |             | 53,700,503  |                |             |              | 48,723,584  |               
|                                                  
|                                                  
|                                                  
|                                                  
|Cash and cash equivalents at beginning of the year |                                                                                                             |                                                        |                                                     |  |             |             | 460,089,294 |                |             |             | 406,388,791 |                |             |              | 357,665,207 |               
|                                                   |                                                                                                             |                                                        |                                                     |  |             |             |             |                |             |             |             |                |             |              |             |               
|Cash and cash equivalents at end of the year       |                                                                                                             | US$                                                    |                                                     |  | 963,434,068 |             |             |                | 460,089,294 |             |             |                | 406,388,791 |             
|                                                   |                                                                                                             |                                                        |                                                     |  |             |             |             |                |             |             |             |                |             |              |             |               
|Supplemental disclosures of cash flow information: |                                                                                                             |                                                        |                                                     |  |             |             |             |                |             |             |             |                |             |              |             |               
|                                                  
|                                                  
|                                                  
|                                                  
|                                                   | Cash paid during the year for interest                                                                      |                                                        | US$                                                 |  |             | 280,256,305 |             |                |             | 277,957,115 |             |                |             | 254,624,744  |            
|                                                   |                                                                                                             |                                                        |                                                     |  |             |             |             |                |             |             |             |                |             |              |             |               
|                                                   | Transfer from securities held to maturity to available for sale                                             |                                                        | US$                                                 |  |             | 81,171,421  |             |                |             | 0           |             |                |             | 0            |            
|                                                   |                                                                                                             |                                                        |                                                     |  |             |             |             |                |             |             |             |                |             |              |             |               

See accompanying notes to consolidated financial
statements.

---

F-6



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES




Notes to Consolidated Financial Statements

December 31, 2001 and 2000

---

(1)       Organization



| |  | Banco Latinoamericano de Exportaciones, S. A. (BLADEX Panama and, together
with its subsidiaries BLADEX or the Bank), headquartered in Panama
City, Panama, is a specialized multinational bank established to finance
trade in Latin America and the Caribbean (the Region). The Bank was
established pursuant to a May 1975 proposal of the XX 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. BLADEX Panama was incorporated under the laws of the
Republic of Panama (Panama) on November 30, 1977 and continues to exist
thereunder. BLADEX Panama began business operations on
January 2, 1979.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | BLADEX Panamas three primary subsidiaries are Banco Latinoamericano de
Exportaciones Limited (BLADEX), (BLADEX Cayman), BLADEX Representacao
Ltda. and BLADEX Holdings Inc. BLADEX Cayman, which is a wholly owned
subsidiary, was incorporated under the laws of the Cayman Islands (B.W.I.)
on September 8, 1987 and continues to exist thereunder. BLADEX
Representacao Ltda., which was incorporated under the laws of Brazil on
January 7, 2000 and continues to exist thereunder, was established to act
as the Banks representative office in Brazil. BLADEX Representacao Ltda.
is 99.999% owned by BLADEX Panama and 0.001% owned by BLADEX Cayman.
BLADEX Holdings, which is a wholly owned subsidiary, was incorporated under
the laws of the state of Delaware on May 30, 2000 and continues to exist
thereunder. Bladex Holdings has a wholly owned subsidiary, BLADEX
Financial Services, LLC, incorporated under the laws of the state of New
York on October 20, 2000 and continues to exist thereunder. BLADEX
Financial Services, LLC has a wholly owned subsidiary, BLADEX Securities,
LLC, incorporated under the laws of the state of New York on October 20,
2000 and continues to exist thereunder. BLADEX Financial Services, LLC,
granted a launching pad business to BLADEX Securities, LLC, until a broker
dealer license was granted on May 23, 2001, by the National Association of
Securities Dealers (NASD) to buy and sell securities in the
United States.
|
| |  | The Bank established an agency in the state of New York (the New York
Agency) which began business on March 27, 1989. The New York Agency,
which continues to exist in the state of New York, is principally engaged
in obtaining inter-bank deposits and short-term borrowings to finance the
Banks short-term investments and foreign trade loans. Prior to the tragic
events that occurred in the United States on September 11, 2001, the New
York Agency and BLADEX Securities, LLC, were located at One World Trade
Center, Suite No. 3227, in New York City. On October 1, 2001, as a result
of September 11, 2001 incidents in New York City, the Bank leased
facilities for its New York operations, including the New York Agency and
BLADEX Securities, LLC, at 641 Lexington Avenue, 32nd Floor, New York, N.Y.
10022. The Bank also has a representative office in Buenos Aires,
Argentina and on November 29, 2000 opened a representative office in Mexico
City, Mexico.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

---

F-7



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | The consolidated financial statements have been prepared under generally
accepted accounting principles in the United States of America (U.S.
GAAP). All amounts presented in the consolidated financial statements and
notes are expressed in U.S. dollars.
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(2)      Summary of Significant Accounting Policies

(a)  Principle of Consolidation



| |  | The consolidated financial statements include the accounts of the
Bank, its New York Agency and its subsidiaries, BLADEX Cayman, BLADEX
Holdings in the United States of America and BLADEX Representacao
Ltda, in Brazil. All significant intercompany balances and
transactions have been eliminated for consolidation purposes.
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(b)  Investment Securities



| |  | Securities are classified at the date of purchase based on the ability
and intent to sell or hold them as investments.
| |  | ----------------------------------------------------------------------------------------------------------------------



| | 1) |  | Securities Available for Sale
| | -- |  | -----------------------------

| |  |  | Securities classified as available for sale are carried at fair
value and interest earned recognized as income. Changes in fair
values are recorded on the other comprehensive income caption in
Stockholders Equity.
| |  |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Realized gains and losses on sales of securities are computed on a
specific identified cost basis and are reported within other income
in the statement of income.
| |  |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 2) |  | Securities Held to Maturity
| | -- |  | ---------------------------

| |  |  | Securities held to maturity are securities that the Bank has the
positive intent and ability to hold to maturity. These securities
consist of debt instruments such as, negotiable commercial paper,
bankers acceptances, bonds and floating rate notes, which are
carried at amortized cost.
| |  |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Any security that experiences a decline in value, which is deemed
other than temporary, is written down to its estimated fair value
through a charge to current period income.
| |  |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(c)  Repurchase and Resale Agreements



| |  | Repurchase and resale agreements are treated as collateralized
financing transactions and are carried at the amounts at which the
securities will be subsequently reacquired or resold, including
accrued interest, as specified in the respective agreements. The
Banks policy is to take possession of securities purchased under
agreements to resell. The market value of securities to be
repurchased and resold is monitored, and additional collateral is
obtained where appropriate to protect against credit exposure.
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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F-8



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---

(d)  Loans



| |  | Loans are reported at their principal amounts outstanding net of
unearned income, reduced by the allowance for loan losses. Unearned
income is generally accreted to interest income using the effective
yield method. Interest on loans is recognized to income on the
accrual basis. Loans are identified as impaired and placed on
non-accrual (cash) basis when any payment of principal or interest is
over 90 days due, or earlier if Banks management determines that the
ultimate collection of principal or interest is doubtful. Any
interest receivable that was accrued during the current period is
reversed and any interest accrued in prior periods is charged-off.
Interest on non-accrual loans is only recorded as earned when
collected. Loans are returned to an accrual status when both
principal and interest are current and the loan is determined to be
performing in accordance with the applicable loan terms. When current
events or available information confirms that specific impaired loans
or portions thereof are uncollectible, these amounts are charged-off
against the allowance for loan losses. When loans are sold without
recourse, they are derecognized from the balance sheet.
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(e)  Allowance for Credit Losses



| |  | The allowance for credit losses is provided for risk on losses,
derived from the credit extension process, inherent in various on and
off balance sheet financial instruments, using the reserve method of
providing for credit losses. The allowance is increased by provisions
charged to operations and recoveries, and decreased by charge-offs.
The allowance for credit losses is based on the evaluation of risks in
the credit portfolio, and additionally, Banks management takes into
consideration the growth, nature and composition of the credit
portfolio, including concentration, prior credit loan losses
experience, and the conditions and general tendencies of the economy
in each borrowing country.
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | The allowance attributable to non-loan credit losses, such as letters
of credit and guarantees, is reported in other liabilities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

(f)  Premises and Equipment



| |  | Premises and equipment are carried at cost less accumulated
depreciation, excepting land, which is carried at cost. Depreciation
is charged to operations using the straight-line method and is
provided over the estimated original useful life of the related
assets.
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(g)  Capital Reserves



| |                                                                                                                                                                                                                                                                                                                                                                                                                                  
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Capital reserves are established by the Bank from retained earnings
and are a form of retained earnings according to Panamanian banking
regulations. The difference between capital reserves and retained
earnings is that the objective of capital reserves is to strengthen
the capital position of the Bank as reductions of these reserves
require the approval of the Board of Directors and Panamanian banking
authorities.

---

F-9



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---

(h)  Earnings Per Share



| |  | Earnings per share (EPS) measure the performance of an entity over
the reporting period. EPS is computed by dividing income available to
common stockholders (the numerator) by the average number of common
shares outstanding (the denominator) during the period.                                                                                                                                              
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | Diluted EPS measures the performance considering the effect that
potential common shares, such as stock options outstanding during the
same period, would have on EPS. The computation is similar to the
computation of the EPS, except that the denominator is increased to
include the number of additional common shares that would have been
outstanding if the diluted potential common shares had been
issued.

(i)  Pre-operating Expenses



| |  | Costs of start-up activities and organization costs, related to new
business initiatives, have been expensed as incurred, in accordance
with SOP 98-5, Reporting on the Costs of Start-Up
Activities.
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(j)  Derivative Financial Instruments



| |  | Effective on January 1, 2001, the Bank adopted Statement of Financial
Accounting Standards No. 133, Accounting for Derivative Instruments
and Hedging Activities (SFAS 133) as amended by SFAS 137 and SFAS 138.
SFAS 133 standardizes the accounting for derivative instruments,
including certain derivative instruments embedded in other contracts.
Under SFAS 133, entities are required to carry all derivatives in the
consolidated balance sheet at fair value. The accounting for changes
in fair value (i.e. gains or losses) of a derivative depends on
whether it has been designated and qualifies as part of a hedging
relationship and, if so, the type of hedge. That is, the derivative
is designated by the Bank as (a) a hedge of the fair value of a
recognized asset or liability or of an unrecognized firm commitment
(fair value hedge); or (b) a hedge of the variability of cash flows
of a forecasted transaction to be received or paid related to a
recognized asset or liability (cash flow hedge); or (c) as a trading
position.
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | Changes in the fair value of a derivative that has been designated and
qualifies as a fair value hedge along with the changes in the fair
value of the hedged asset or liability that is attributable to the
hedged risk, are recorded in current period income. Changes in the
fair value of a derivative that has been designated and qualifies as a
cash flow hedge are recorded in other comprehensive income to the
extent of its effectiveness, until earnings are impacted by the
variability of cash flows from the hedged item. Changes in the fair
value of derivatives held for trading purposes or that do not qualify
as hedges are reported in current period earnings.                                                                                                                                                                                                                                                                                                                                                                              

---

F-10



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | The Bank is an end user of derivative financial instruments, primarily
foreign exchange forward contracts and interest rate swaps, as part of
an overall foreign exchange and interest rate risk management.                                                                                                                    
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | Foreign exchange forward contracts are commitments to purchase non-US
dollar currencies at a specified price on an agreed-upon future date
and used principally to hedge non-US dollar interest paying
liabilities.                                                                                                             
|
| |  | Interest rate swaps are contracts that represent an exchange of
interest payment streams based on an agreed-upon notional principal
amount with one stream based on a specified floating-rate or fixed
rate. The underlying principal balances are not affected. Net
settlement amounts are reported as adjustments to interest.
|
| |  | The Bank also sold a series of options on sovereign risk assets under
which the Bank subsequently purchased underlying assets at par and
booked them as investments at their respective market values.                                                                                                                          
|
| |  | Prior to adoption of SFAS 133 derivate financial instruments were
carried as off balance sheet items.                                                                                                                                                                                                                           

(k)  Commission Income



| |  | Loan origination fees net of direct loan origination costs are
deferred and recognized over the contract life of the loans as an
adjustment of yield. Also, fees earned on commercial and stand-by
letters-of-credit guarantees and commitments are amortized until
expired.
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(l)  Income Taxes



| |  | BLADEX Panama and BLADEX Cayman are exempt from the payment of income
taxes. BLADEX Representacao Ltda., in Brazil, is subject to income
taxes. The New York Agency of the Bank and BLADEX subsidiaries
incorporated in the United States of America are subject to United
States of America federal and local taxation based on the portion of
income, which is effectively connected with its operations in that
country. However, such amounts have been immaterial to date.
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(m)  Foreign Currency Translation



| |  | The accounts of the Banks foreign operations are measured using the
local currency as the functional currency. Assets and liabilities are
translated into United States dollars at the period end exchange
rates.
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(n)  Cash Equivalents



| |  | For purposes of the consolidated statements of cash flows, cash
equivalents consist of due from banks, interest-bearing deposits with
banks, and securities with original maturities of six months or less,
except certificates of deposit and bankers acceptances pledged (see
note 5).
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

F-11



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---

(o)  Use of Estimates



| |  | The preparation of the consolidated financial statements in conformity
with generally accepted accounting principles in the United States of
America requires the Bank to make estimates and 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. Actual results could differ from those
estimates. Material estimates that are particularly susceptible to
significant change relate to the determination of the allowances for
credit losses.
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(p)  Cash and Stock Compensation



| |  | In accordance with SFAS No. 123, Accounting for Stock-Based
Compensation, the Bank has elected to continue using the intrinsic
value based method of accounting for the employee stock option plan
prescribed by APB Opinion No. 25, Accounting for Stock Issued to
Employees. Under the intrinsic value based method, compensation cost
is the excess, if any, of the quoted market price of the stock at
grant date or other measurement date over the amount an employee must
pay to acquire the stock. Since the purchase price at grant date was
equal to the market price, no compensation cost is recognized.
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(q)  Uniformity in the Presentation of the Financial Statements



| |  | Certain amounts for the years 2000 and 1999 have been reclassified to
make them uniform to the presentation of the 2001 consolidated
financial statements.
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------

---

F-12



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---

(3)      Balances and Transactions with Related Parties



| |  | The consolidated balance sheets and consolidated statements of income
include the following balances and transactions with related parties
(shareholder banks and their affiliates):
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                |  |     |  |  |             |      |               |              |             |  |               | 
|----------------------------------------------- |  | --- |  |  | ----------- | ---- | ------------- | ------------ | ----------- |  | ------------- | 
|                                                |  |     |  |  |             |      |               | December 31, |             | 
|                                                |  |     |  |  |             |     
|                                                |  |     |  |  |             | 2001 |               | 2000        
|                                                |  |     |  |  |             |      |               |             
|Assets                                          |  |     |  |  |             |      |               |              |             |  |               | 
|                                               
|                                               
|                                               
|                                               
|Cash and due from banks                         |  | US$ |  |  | 582,749     |      |               |              | 667,069     | 
|                                               
|                                               
|                                               
|                                               
|Interest-bearing deposits with banks            |  |     |  |  |             |      | 85,400,000    |              |             |  | 88,930,288    | 
|                                               
|                                               
|                                               
|                                               
|Securities purchased under agreements to
resell |  |     |  |  |             |      | 291,871,322   |              |             |  | 0             | 
|                                               
|                                               
|                                               
|                                               
|Investment securities                           |  |     |  |  |             |      | 118,965,782   |              |             |  | 29,200,000    | 
|                                               
|                                               
|                                               
|                                               
|Loans                                           |  |     |  |  |             |      | 2,595,551,974 |              |             |  | 2,779,479,089 | 
|                                               
|                                               
|                                               
|                                               
|Customers liabilities under acceptances        |  |     |  |  |             |      | 27,269,823    |              |             |  | 5,397,326     | 
|                                               
|                                               
|                                               
|                                               
|Accrued interest receivable                     |  |     |  |  |             |      | 67,930,565    |              |             |  | 80,027,834    | 
|                                               
|                                               
|                                               
|                                               
|Other assets                                    |  |     |  |  |             |      | 3,204,113     |              |             |  | 0             | 
|                                               
|                                               
|                                               
|                                               
|Liabilities                                     |  |     |  |  |             |      |               |              |             |  |               | 
|                                               
|                                               
|                                               
|                                               
|Demand deposits                                 |  |     |  |  |             |      | 51,515,360    |              |             |  | 4,138,112     | 
|                                               
|                                               
|                                               
|                                               
|Time deposits                                   |  |     |  |  |             |      | 1,120,202,252 |              |             |  | 1,227,155,590 | 
|                                               
|                                               
|                                               
|                                               
|Short-term borrowings and placements            |  |     |  |  |             |      | 381,209,779   |              |             |  | 295,628,048   | 
|                                               
|                                               
|                                               
|                                               
|Medium and long-term borrowings and placements  |  |     |  |  |             |      | 260,778,975   |              |             |  | 348,642,622   | 
|                                               
|                                               
|                                               
|                                               
|Acceptances outstanding                         |  |     |  |  |             |      | 25,896,791    |              |             |  | 1,723,435     | 
|                                               
|                                               
|                                               
|                                               
|Accrued interest payable                        |  |     |  |  |             |      | 26,106,677    |              |             |  | 27,302,484    | 
|                                               
|                                               
|                                               
|                                               
|Commitments and contingent liabilities          |  |     |  |  |             |      |               |              |             |  |               | 
|                                               
|                                               
|                                               
|                                               
|Letters of credit and guarantees                |  |     |  |  |             |      | 393,381,681   |              |             |  | 407,133,854   | 
|                                               
|                                               
|                                               
|                                               
|Foreign exchange contracts                      |  |     |  |  |             |      | 46,000,000    |              |             |  | 166,490,789   | 
|                                               
|                                               
|                                               
|                                               
|Interest rate swaps                             |  | US$ |  |  | 156,535,875 |      |               |              | 263,548,553 | 

|                    |  |     |  |  |             |      |             |      |             |              |             |  |             |  |             | 
|------------------- |  | --- |  |  | ----------- | ---- | ----------- | ---- | ----------- | ------------ | ----------- |  | ----------- |  | ----------- | 
|                    |  |     |  |  |             |      |             |      |             | December 31, |             |  |             | 
|                    |  |     |  |  |             |     
|                    |  |     |  |  |             | 2001 |             | 2000 |             | 1999        
|                    |  |     |  |  |             |      |             |      |             |             
|Income
and expenses |  |     |  |  |             |      |             |      |             |              |             |  |             | 
|Interest
income     |  | US$ |  |  | 265,331,201 |      |             |      | 300,614,492 |              |             |  | 287,385,401 | 
|                   
|                   
|                   
|                   
|Interest expense    |  |     |  |  |             |      | 146,563,010 |      |             |              | 187,807,054 |  |             |  | 152,783,516 | 



| |  | In the normal course of business, the Bank has operations with a great
number of Class A, B and E stockholders (see note 13). All the
operations are made at arms-length terms subject to prevailing commercial
criteria and market rates. None of the Class A, and B stockholders
have a shareholding participation in excess of 3% of total shares, within
each class of shares.
| |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

F-13



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---

(4)      Securities Purchased under Agreements to Resell



| |  | The Bank enters into purchases of securities under agreements to resell the
same or substantially identical securities. These agreements are
considered secured loans. These securities generally consist of U.S.
Treasury securities and other debt securities. At December 31, 2001,
securities purchased under agreements to resell had a carrying value of
US$291,871,322 and consisted entirely on U.S. Treasury securities. At
December 31, 2001, the maturity of these agreements does not exceed 30
days, and are current.
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(5)      Investment Securities

(a)  Securities Available for Sale



| |  | These securities consist of debt instruments that the Bank buys with
the intention of selling them in the future, as part of its credit
portfolio lending activity.
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | The securities available for sale are summarized as follows:                                                                                                       

|                        |  |     |  |  |            |           |            |            |        |                   |        |             |        |  |        |  |            |  |            | 
|----------------------- |  | --- |  |  | ---------- | --------- | ---------- | ---------- | ------ | ----------------- | ------ | ----------- | ------ |  | ------ |  | ---------- |  | ---------- | 
|                        |  |     |  |  |            |           |            |            |        | December 31, 2001 |        |             |        | 
|                        |  |     |  |  |            |          
|                        |  |     |  |  |            |           |            |            |        | Estimated         |        | Estimated   |        |  |        | 
|                        |  |     |  |  |            | Amortized |            | Unrealized |        | Unrealized        |        | Estimated  
|                        |  |     |  |  |            | Cost      |            | Gross Gain |        | Gross Loss        |        | Fair Values
|                        |  |     |  |  |            |           |            |            |        |                   |        |            
|Bonds                   |  | US$ |  |  | 21,398,313 |           |            |            | 98,313 |                   |        |             | 63,841 |  |        |  | 21,432,785 | 
|                       
|                       
|                       
|                       
|Certificates of deposit |  |     |  |  |            |           | 764,184    |            |        |                   | 0      |             |        |  | 56     |  |            |  | 764,128    | 
|                        |  |     |  |  |            |           |            |            |        |                   |        |             |        |  |        |  |            |  |            | 
|                        |  |     |  |  |            |           | 22,162,497 |            |        |                   | 98,313 |             |        |  | 63,897 |  |            |  | 22,196,913 | 
|                       
|                       
|                       
|                       
|Impaired bonds          |  |     |  |  |            |           | 2,000,000  |            |        |                   | 0      |             |        |  | 0      |  |            |  | 2,000,000  | 
|                        |  |     |  |  |            |           |            |            |        |                   |        |             |        |  |        |  |            |  |            | 
|                        |  | US$ |  |  | 24,162,497 |           |            |            | 98,313 |                   |        |             | 63,897 |  |        |  | 24,196,913 | 
|                        |  |     |  |  |            |           |            |            |        |                   |        |             |        |  |        |  |            |  |            | 



| |  | As of December 31, 2001 the amortized cost is net of an impairment
loss of US$8,000,000 charged to operations, which is related to
Argentine available for sale securities.
| |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|      |  |     |  |  |            |           |  |            |   |                   |  |             |   |  |  |  |            |  |  | 
|----- |  | --- |  |  | ---------- | --------- |  | ---------- | - | ----------------- |  | ----------- | - |  |  |  | ---------- |  |  | 
|      |  |     |  |  |            |           |  |            |   | December 31, 2000 |  |             |   | 
|      |  |     |  |  |            |          
|      |  |     |  |  |            |           |  |            |   | Estimated         |  | Estimated   |   |  |  | 
|      |  |     |  |  |            | Amortized |  | Unrealized |   | Unrealized        |  | Estimated  
|      |  |     |  |  |            | Cost      |  | Gross Gain |   | Gross Loss        |  | Fair Values
|      |  |     |  |  |            |           |  |            |   |                   |  |            
|Bonds |  | US$ |  |  | 10,000,000 |           |  |            | 0 |                   |  |             | 0 |  |  |  | 10,000,000 | 
|      |  |     |  |  |            |           |  |            |   |                   |  |             |   |  |  |  |            |  |  | 



| |  | The following table represents the realized components of investment
securities transactions attributable to securities available for
sale:
| |  | -------------------------------------------------------------------------------------------------------------------------------------------

|      |  |     |  |  |           |       |  |          |   |              |  |          |   |  |  |  |   |  |  | 
|----- |  | --- |  |  | --------- | ----- |  | -------- | - | ------------ |  | -------- | - |  |  |  | - |  |  | 
|      |  |     |  |  |           |       |  |          |   | December 31, |  |          |   | 
|      |  |     |  |  |           |      
|      |  |     |  |  |           | 2001  |  | 2000    
|      |  |     |  |  |           |       |  |         
|      |  |     |  |  |           | Gains |  | (Losses) |   | Gains        |  | (Losses)
|      |  |     |  |  |           |       |  |          |   |              |  |         
|Bonds |  | US$ |  |  | 4,798,368 |       |  |          | 0 |              |  |          | 0 |  |  |  | 0 | 
|      |  |     |  |  |           |       |  |          |   |              |  |          |   |  |  |  |   |  |  | 

---

F-14



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | The amortized cost and fair values of securities available for sale at
December 31, 2001 and 2000 by contractual maturity are shown in the
following table. Expected maturities may differ from contractual
maturities because borrowers have the right to prepay obligations
without prepayment penalties in certain cases.
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                |  |     |  |  |            |           |            |       |            |              |            |       |            |  |   |  |            |  |   | 
|------------------------------- |  | --- |  |  | ---------- | --------- | ---------- | ----- | ---------- | ------------ | ---------- | ----- | ---------- |  | - |  | ---------- |  | - | 
|                                |  |     |  |  |            |           |            |       |            | December 31, |            |       |            | 
|                                |  |     |  |  |            |          
|                                |  |     |  |  |            | 2001      |            | 2000 
|                                |  |     |  |  |            |           |            |      
|                                |  |     |  |  |            | Amortized |            | Fair  |            | Amortized    |            | Fair 
|                                |  |     |  |  |            | Cost      |            | Value |            | Cost         |            | Value
|                                |  |     |  |  |            |           |            |       |            |              |            |      
|Within one year                 |  | US$ |  |  | 5,822,593  |           |            |       | 5,851,013  |              |            |       | 10,000,000 |  |   |  | 10,000,000 | 
|                               
|                               
|                               
|                               
|After one but
within five years |  |     |  |  |            |           | 18,339,904 |       |            |              | 18,345,900 |       |            |  | 0 |  |            |  | 0 | 
|                                |  |     |  |  |            |           |            |       |            |              |            |       |            |  |   |  |            |  |   | 
|                                |  | US$ |  |  | 24,162,497 |           |            |       | 24,196,913 |              |            |       | 10,000,000 |  |   |  | 10,000,000 | 
|                                |  |     |  |  |            |           |            |       |            |              |            |       |            |  |   |  |            |  |   | 



| |  | Securities held to maturity were transferred to available for sale as
of January 2001, in connection with the adoption of SFAS 133, with an
amortized cost of US$80,750,000, a fair value of US$81,171,421, and an
estimated unrealized holding gain presented in other comprehensive
income of US$421,421.
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(b)  Securities Held to Maturity



| |  | The Banks treasury investment policy is to acquire securities with
maturities up to 3 years, as long as they have a short-term rating of
A1/P1 or long-term rating of A or better, issued by at least two
of the following agencies: Standard & Poors, Moodys Investors, and
Fitch IBCA, and be negotiable in secondary markets.                                                                         
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | The Bank has classified under these captions, securities which do not
adhere to the Banks treasury investment policy, such as bonds and
floating rates notes, which were bought as part of its credit
portfolio lending activity. As of December 31, 2001 and 2000, the
outstanding balances of securities held to maturity belonging to
credit portfolio were US$331,901,358 and US$381,958,879,
respectively.
|
| |  | The carrying value, approximate market value, and related gross
unrealized gain (loss) of these securities are as follows:                                                                                                                                                                                                                                                                                      

|                             |  |     |  |  |             |           |             |            |            |                   |            |             |       |  |       |  |             |  |             | 
|---------------------------- |  | --- |  |  | ----------- | --------- | ----------- | ---------- | ---------- | ----------------- | ---------- | ----------- | ----- |  | ----- |  | ----------- |  | ----------- | 
|                             |  |     |  |  |             |           |             |            |            | December 31, 2001 |            |             |       | 
|                             |  |     |  |  |             |          
|                             |  |     |  |  |             |           |             |            |            | Estimated         |            | Estimated   |       |  |       | 
|                             |  |     |  |  |             | Amortized |             | Unrealized |            | Unrealized        |            | Estimated  
|                             |  |     |  |  |             | Cost      |             | Gross Gain |            | Gross Loss        |            | Fair Values
|                             |  |     |  |  |             |           |             |            |            |                   |            |            
|Bonds                        |  | US$ |  |  | 175,832,903 |           |             |            | 7,383,686  |                   |            |             | 0     |  |       |  | 183,216,589 | 
|                            
|                            
|                            
|                            
|Floating rate notes          |  |     |  |  |             |           | 104,935,294 |            |            |                   | 5,653,595  |             |       |  | 0     |  |             |  | 110,588,889 | 
|                            
|                            
|                            
|                            
|Certificates of deposit      |  |     |  |  |             |           | 19,330,779  |            |            |                   | 30,534     |             |       |  | 0     |  |             |  | 19,361,313  | 
|                            
|                            
|                            
|                            
|Treasury bills               |  |     |  |  |             |           | 29,713,493  |            |            |                   | 0          |             |       |  | 1,938 |  |             |  | 29,711,555  | 
|                             |  |     |  |  |             |           |             |            |            |                   |            |             |       |  |       |  |             |  |             | 
|                             |  |     |  |  |             |           | 329,812,469 |            |            |                   | 13,067,815 |             |       |  | 1,938 |  |             |  | 342,878,346 | 
|                            
|                            
|                            
|                            
|Impaired floating rate
notes |  |     |  |  |             |           | 8,088,889   |            |            |                   | 0          |             |       |  | 0     |  |             |  | 8,088,889   | 
|                             |  |     |  |  |             |           |             |            |            |                   |            |             |       |  |       |  |             |  |             | 
|                             |  | US$ |  |  | 337,901,358 |           |             |            | 13,067,815 |                   |            |             | 1,938 |  |       |  | 350,967,235 | 
|                             |  |     |  |  |             |           |             |            |            |                   |            |             |       |  |       |  |             |  |             | 

---

F-15



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | As of December 31, 2001 the amortized cost of these securities is net
of an impairment loss of US$32,355,555 charged to operations, which is
related to Argentine held to maturity securities.
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                        |  |     |  |  |             |           |            |            |           |                   |        |                |         |  |         |  |             |  |            | 
|----------------------- |  | --- |  |  | ----------- | --------- | ---------- | ---------- | --------- | ----------------- | ------ | -------------- | ------- |  | ------- |  | ----------- |  | ---------- | 
|                        |  |     |  |  |             |           |            |            |           | December 31, 2000 |        |                |         | 
|                        |  |     |  |  |             |          
|                        |  |     |  |  |             |           |            |            |           | Estimated         |        | Estimated      |         |  |         | 
|                        |  |     |  |  |             | Amortized |            | Unrealized |           | Unrealized        |        | Estimated Fair
|                        |  |     |  |  |             | Cost      |            | Gross Gain |           | Gross Loss        |        | Values        
|                        |  |     |  |  |             |           |            |            |           |                   |        |               
|Bonds                   |  | US$ |  |  | 234,271,012 |           |            |            | 4,798,239 |                   |        |                | 0       |  |         |  | 239,069,251 | 
|                       
|                       
|                       
|                       
|Floating rate notes     |  |     |  |  |             |           | 37,073,862 |            |           |                   | 0      |                |         |  | 136,862 |  |             |  | 36,937,000 | 
|                       
|                       
|                       
|                       
|Commercial paper        |  |     |  |  |             |           | 46,671,660 |            |           |                   | 38,128 |                |         |  | 0       |  |             |  | 46,709,788 | 
|                       
|                       
|                       
|                       
|Certificates of deposit |  |     |  |  |             |           | 36,214,778 |            |           |                   | 0      |                |         |  | 1,209   |  |             |  | 36,213,569 | 
|                       
|                       
|                       
|                       
|Treasury bills          |  |     |  |  |             |           | 19,513,983 |            |           |                   | 0      |                |         |  | 750     |  |             |  | 19,513,233 | 
|                        |  |     |  |  |             |           |            |            |           |                   |        |                |         |  |         |  |             |  |            | 
|Euro medium-term notes  |  |     |  |  |             |           | 11,713,584 |            |           |                   | 0      |                |         |  | 0       |  |             |  | 11,713,584 | 
|                        |  |     |  |  |             |           |            |            |           |                   |        |                |         |  |         |  |             |  |            | 
|                        |  | US$ |  |  | 385,458,879 |           |            |            | 4,836,367 |                   |        |                | 138,821 |  |         |  | 390,156,425 | 
|                        |  |     |  |  |             |           |            |            |           |                   |        |                |         |  |         |  |             |  |            | 



| |  | The distribution of these securities by maturity is as follows:
| |  | ---------------------------------------------------------------

|                         |                           |     |     |  |             |            |              |            |             |            |             |             | 
|------------------------ | ------------------------- | --- | --- |  | ----------- | ---------- | ------------ | ---------- | ----------- | ---------- | ----------- | ----------- | 
|                         |                           |     |     |  |             |            | December 31,
|                         |                           |     |     |  |             |            |             
|                         |                           |     |     |  |             |            | 2001         |            | 2000       
|                         |                           |     |     |  |             |            |              |            |            
|Bonds:                   |                           |     |     |  |             |            |              |            |             |            |             |            
|                        
|                        
|                        
|                        
|                         | From 2 months to 3 months |     | US$ |  |             | 22,780,026 |              |            |             | 39,775,000 |            
|                        
|                        
|                        
|                        
|                         | From 3 months to 6 months |     |     |  |             |            |              | 25,113,798 |             |            |             | 13,850,000  | 
|                        
|                        
|                        
|                        
|                         | From 6 months to 1 year   |     |     |  |             |            |              | 52,924,816 |             |            |             | 50,745,131  | 
|                        
|                        
|                        
|                        
|                         | Over 1 year               |     |     |  |             |            |              | 75,014,263 |             |            |             | 129,900,881 | 
|                         |                           |     |     |  |             |            |              |            |             |            |             |            
|                         |                           |     |     |  |             |            | 175,832,903  |            |             |            | 234,271,012 |            
|                         |                           |     |     |  |             |            |              |            |             |            |             |            
|Floating rate notes:     |                           |     |     |  |             |            |              |            |             |            |             |            
|                        
|                        
|                        
|                        
|                         | From 3 months to 6 months |     |     |  |             |            |              | 15,000,000 |             |            |             | 2,200,000   | 
|                        
|                        
|                        
|                        
|                         | From 6 months to 1 year   |     |     |  |             |            |              | 9,533,334  |             |            |             | 0           | 
|                        
|                        
|                        
|                        
|                         | Over 1 year               |     |     |  |             |            |              | 88,490,849 |             |            |             | 34,873,862  | 
|                         |                           |     |     |  |             |            |              |            |             |            |             |            
|                         |                           |     |     |  |             |            | 113,024,183  |            |             |            | 37,073,862  |            
|                         |                           |     |     |  |             |            |              |            |             |            |             |            
|Commercial paper:        |                           |     |     |  |             |            |              |            |             |            |             |            
|                        
|                        
|                        
|                        
|                         | From 3 months to 6 months |     |     |  |             |            |              | 0          |             |            |             | 23,259,340  | 
|                        
|                        
|                        
|                        
|                         | From 6 months to 1 year   |     |     |  |             |            |              | 0          |             |            |             | 23,412,320  | 
|                         |                           |     |     |  |             |            |              |            |             |            |             |            
|                         |                           |     |     |  |             |            | 0            |            |             |            | 46,671,660  |            
|                         |                           |     |     |  |             |            |              |            |             |            |             |            
|Certificates of deposit: |                           |     |     |  |             |            |              |            |             |            |             |            
|                        
|                        
|                        
|                        
|                         | Up to 1 month             |     |     |  |             |            |              | 6,000,000  |             |            |             | 0           | 
|                        
|                        
|                        
|                        
|                         | From 2 months to 3 months |     |     |  |             |            |              | 9,414,233  |             |            |             | 36,214,778  | 
|                        
|                        
|                        
|                        
|                         | From 3 months to 6 months |     |     |  |             |            |              | 3,916,546  |             |            |             | 0           | 
|                         |                           |     |     |  |             |            |              |            |             |            |             |            
|                         |                           |     |     |  |             |            | 19,330,779   |            |             |            | 36,214,778  |            
|                         |                           |     |     |  |             |            |              |            |             |            |             |            
|Treasury bills:          |                           |     |     |  |             |            |              |            |             |            |             |            
|                        
|                        
|                        
|                        
|                         | From 2 months to 3 months |     |     |  |             |            |              | 24,816,393 |             |            |             | 4,909,819   | 
|                        
|                        
|                        
|                        
|                         | From 3 months to 6 months |     |     |  |             |            |              | 0          |             |            |             | 14,604,164  | 
|                        
|                        
|                        
|                        
|                         | From 6 months to 1 year   |     |     |  |             |            |              | 4,897,100  |             |            |             | 0           | 
|                         |                           |     |     |  |             |            |              |            |             |            |             |            
|                         |                           |     |     |  |             |            | 29,713,493   |            |             |            | 19,513,983  |            
|                         |                           |     |     |  |             |            |              |            |             |            |             |            
|Euro medium-term notes:  |                           |     |     |  |             |            |              |            |             |            |             |            
|                        
|                        
|                        
|                        
|                         | From 3 months to 6 months |     |     |  |             |            |              | 0          |             |            |             | 11,713,584  | 
|                         |                           |     |     |  |             |            |              |            |             |            |             |            
|                         |                           | US$ |     |  | 337,901,358 |            |              |            | 385,458,879 |           
|                         |                           |     |     |  |             |            |              |            |             |            |             |            

---

F-16



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | At December 31, 2001 and 2000, the New York Agency had pledged certificates
of deposit with carrying value of US$6,000,000 and US$3,500,000,
respectively, with the State of New York Banking Department, as required by
law since March 1994.
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | As of December 31, 2001 and 2000 securities considered cash equivalents
amounted to US$115,892,009 and US$147,526,685, respectively.                                                                                                          

(6)       Loans



| |  | The composition of the loan portfolio based on original terms is as
follows:
| |  | ----------------------------------------------------------------------------

|                     |  |     |  |  |               |              |               |      |               |  |               | 
|-------------------- |  | --- |  |  | ------------- | ------------ | ------------- | ---- | ------------- |  | ------------- | 
|                     |  |     |  |  |               | December 31,
|                     |  |     |  |  |               |             
|                     |  |     |  |  |               | 2001         |               | 2000
|                     |  |     |  |  |               |              |               |     
|Short-term:          |  |     |  |  |               |              |               |      |               |  |               | 
|                    
|                    
|                    
|                    
|Advances             |  | US$ |  |  | 2,378,463,253 |              |               |      | 2,650,509,955 | 
|                    
|                    
|                    
|                    
|Discounted loans     |  |     |  |  |               |              | 206,908,430   |      |               |  | 130,914,057   | 
|                    
|                    
|                    
|                    
|Acceptance financing |  |     |  |  |               |              | 14,675        |      |               |  | 23,863,345    | 
|                     |  |     |  |  |               |              |               |      |               |  |               | 
|                     |  |     |  |  |               |              | 2,585,386,358 |      |               |  | 2,805,287,357 | 
|                     |  |     |  |  |               |              |               |      |               |  |               | 
|Medium-term          |  |     |  |  |               |              | 2,145,123,898 |      |               |  | 2,118,978,269 | 
|                    
|                    
|                    
|                    
|Long-term            |  |     |  |  |               |              | 3,199,442     |      |               |  | 3,199,442     | 
|                     |  |     |  |  |               |              |               |      |               |  |               | 
|                     |  | US$ |  |  | 4,733,709,698 |              |               |      | 4,927,465,068 | 
|                     |  |     |  |  |               |              |               |      |               |  |               | 



| |  | The distribution of the loan portfolio by fixed and floating interest
rates is as follows:
| |  | ------------------------------------------------------------------------------------------

|                        |  |     |  |  |               |              |               |      |               |  |               | 
|----------------------- |  | --- |  |  | ------------- | ------------ | ------------- | ---- | ------------- |  | ------------- | 
|                        |  |     |  |  |               | December 31,
|                        |  |     |  |  |               |             
|                        |  |     |  |  |               | 2001         |               | 2000
|                        |  |     |  |  |               |              |               |     
|Fixed interest rates    |  | US$ |  |  | 2,520,665,903 |              |               |      | 3,194,200,430 | 
|                       
|                       
|                       
|                       
|Floating interest rates |  |     |  |  |               |              | 2,213,043,795 |      |               |  | 1,733,264,638 | 
|                        |  |     |  |  |               |              |               |      |               |  |               | 
|                        |  | US$ |  |  | 4,733,709,698 |              |               |      | 4,927,465,068 | 
|                        |  |     |  |  |               |              |               |      |               |  |               | 

---

F-17



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---

A summary of loans by country risk is as follows:

|                    |  |     |  |  |               |              |               |      |               |  |               | 
|------------------- |  | --- |  |  | ------------- | ------------ | ------------- | ---- | ------------- |  | ------------- | 
|                    |  |     |  |  |               | December 31,
|                    |  |     |  |  |               |             
|Country             |  |     |  |  |               | 2001         |               | 2000
|                    |  |     |  |  |               |              |               |     
|Argentina           |  | US$ |  |  | 804,201,840   |              |               |      | 1,128,334,470 | 
|                   
|                   
|                   
|                   
|Bolivia             |  |     |  |  |               |              | 25,960,731    |      |               |  | 19,737,406    | 
|                   
|                   
|                   
|                   
|Brazil              |  |     |  |  |               |              | 2,012,557,644 |      |               |  | 1,857,974,417 | 
|                   
|                   
|                   
|                   
|Chile               |  |     |  |  |               |              | 112,428,710   |      |               |  | 82,717,239    | 
|                   
|                   
|                   
|                   
|Colombia            |  |     |  |  |               |              | 138,372,173   |      |               |  | 118,839,475   | 
|                   
|                   
|                   
|                   
|Costa Rica          |  |     |  |  |               |              | 67,345,677    |      |               |  | 24,220,598    | 
|                   
|                   
|                   
|                   
|Dominican Republic  |  |     |  |  |               |              | 174,932,878   |      |               |  | 102,809,232   | 
|                   
|                   
|                   
|                   
|Ecuador             |  |     |  |  |               |              | 13,880,241    |      |               |  | 63,205,639    | 
|                   
|                   
|                   
|                   
|El Salvador         |  |     |  |  |               |              | 19,344,856    |      |               |  | 24,800,000    | 
|                   
|                   
|                   
|                   
|Guatemala           |  |     |  |  |               |              | 22,656,284    |      |               |  | 29,629,320    | 
|                   
|                   
|                   
|                   
|Jamaica             |  |     |  |  |               |              | 7,107,871     |      |               |  | 6,315,404     | 
|                   
|                   
|                   
|                   
|Mexico              |  |     |  |  |               |              | 832,747,320   |      |               |  | 1,029,595,228 | 
|                   
|                   
|                   
|                   
|Nicaragua           |  |     |  |  |               |              | 37,712,241    |      |               |  | 25,026,388    | 
|                   
|                   
|                   
|                   
|Panama              |  |     |  |  |               |              | 43,152,616    |      |               |  | 118,404,257   | 
|                   
|                   
|                   
|                   
|Paraguay            |  |     |  |  |               |              | 618,000       |      |               |  | 1,559,745     | 
|                   
|                   
|                   
|                   
|Peru                |  |     |  |  |               |              | 119,501,160   |      |               |  | 192,307,615   | 
|                   
|                   
|                   
|                   
|Trinidad and Tobago |  |     |  |  |               |              | 58,789,456    |      |               |  | 55,371,088    | 
|                   
|                   
|                   
|                   
|Uruguay             |  |     |  |  |               |              | 0             |      |               |  | 6,780,000     | 
|                   
|                   
|                   
|                   
|Venezuela           |  |     |  |  |               |              | 242,400,000   |      |               |  | 39,837,547    | 
|                    |  |     |  |  |               |              |               |      |               |  |               | 
|                    |  | US$ |  |  | 4,733,709,698 |              |               |      | 4,927,465,068 | 
|                    |  |     |  |  |               |              |               |      |               |  |               | 



| |  | The Banks past due loans, including cash basis loans, and the related
foregone interest revenue on such loans were as follows:
| |  | -------------------------------------------------------------------------------------------------------------------------------

|                                     |                      |     |     |  |            |             |              |  |            |            |           |  |            |            |   |  | 
|------------------------------------ | -------------------- | --- | --- |  | ---------- | ----------- | ------------ |  | ---------- | ---------- | --------- |  | ---------- | ---------- | - |  | 
|                                     |                      |     |     |  |            |             | December 31,
|                                     |                      |     |     |  |            |             |             
|                                     |                      |     |     |  |            |             | 2001         |  | 2000       |            | 1999     
|                                     |                      |     |     |  |            |             |              |  |            |            |          
|On non-accrual basis                 |                      | US$ |     |  | 77,060,927 |             |              |  | 14,723,989 |            |           |  | 23,785,753 |           
|                                    
|                                    
|                                    
|                                    
|On accrual basis (less than
90 days) |                      |     |     |  |            |             | 49,625,222   |  |            |            | 1,917,886 |  |            |            | 0 | 
|                                     |                      |     |     |  |            |             |              |  |            |            |           |  |            |            |   | 
|                                     | Total past due loans |     | US$ |  |            | 126,686,149 |              |  |            | 16,641,875 |           |  |            | 23,785,753 |  
|                                     |                      |     |     |  |            |             |              |  |            |            |           |  |            |            |   | 
|Foregone interest revenue            |                      | US$ |     |  | 584,049    |             |              |  | 1,322,214  |            |           |  | 929,147    |           
|                                     |                      |     |     |  |            |             |              |  |            |            |           |  |            |            |   | 



| |  | The Bank identified impaired loans totaling US$77,060,927 at December 31,
2001, which had an allocation from the allowance for loan losses of
US$22,894,918. The Bank identified impaired loans totaling US$14,723,989
at December 31, 2000, which had an allocation from the allowance for loan
losses of US$9,235,652. The average recorded investment in such impaired
loans was US$6,877,713 and US$19,629,800 in 2001 and 2000,
respectively.
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

F-18



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | The maturities of loans are summarized as follows:
| |  | --------------------------------------------------

|         |                           |     |     |  |               |             |              |               |               |             |            |               | 
|-------- | ------------------------- | --- | --- |  | ------------- | ----------- | ------------ | ------------- | ------------- | ----------- | ---------- | ------------- | 
|         |                           |     |     |  |               |             | December 31,
|         |                           |     |     |  |               |             |             
|         |                           |     |     |  |               |             | 2001         |               | 2000         
|         |                           |     |     |  |               |             |              |               |              
|Current: |                           |     |     |  |               |             |              |               |               |             |            |              
|        
|        
|        
|        
|         | Up to 1 month             |     | US$ |  |               | 481,084,303 |              |               |               | 307,881,649 |           
|        
|        
|        
|        
|         | From 1 month to 3 months  |     |     |  |               |             |              | 831,838,565   |               |             |            | 737,707,700   | 
|        
|        
|        
|        
|         | From 3 months to 6 months |     |     |  |               |             |              | 986,618,992   |               |             |            | 1,127,048,670 | 
|        
|        
|        
|        
|         | From 6 months to 1 year   |     |     |  |               |             |              | 736,802,886   |               |             |            | 947,334,865   | 
|        
|        
|        
|        
|         | Over 1 year               |     |     |  |               |             |              | 1,570,678,803 |               |             |            | 1,790,850,309 | 
|        
|        
|        
|        
|Past due |                           |     |     |  |               |             | 126,686,149  |               |               |             | 16,641,875 |              
|         |                           |     |     |  |               |             |              |               |               |             |            |              
|         |                           | US$ |     |  | 4,733,709,698 |             |              |               | 4,927,465,068 |            
|         |                           |     |     |  |               |             |              |               |               |             |            |              



| |  | The prolonged deterioration in Argentinas economic and political
environment, financial condition and investor confidence, has resulted in a
profound crisis which has forced the Argentine government to adopt, in
December 2001, stringent measures including foreign exchange and deposit
controls, bank holidays, and restrictions on the repayment of foreign debt.
Given the lack of a clearly defined and comprehensive monetary and banking
policy framework and the continuing volatility of Argentinas political and
financial situation, there is great uncertainty as to how or when the
situation will be resolved.                                                                                                                                                                                                                                                            
| |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | The Banks exposure to Argentina amounted to US$1.1 billion at December 31,
2001, including loans for US$804 millions, securities for US$50 millions,
and off balance sheet financial risk instruments for US$234 millions. This
exposure represents a reduction of 27% from a year ago, and is distributed
among the countrys top tier local banks (12%), local corporations (14%),
state-owned banks (24%), multinational corporations (23%), and
international banks (27% of which, 70% represent subsidiaries and 30%
represents branches). In addition, the Bank maintains exposure of US$292
millions in securities purchased under agreements to resell with
counterparties in Argentina, which are fully secured with U.S. Treasury
securities. The Bank does not hold Argentine sovereign debt and 49% of the
Banks exposure in Argentina is considered trade-related
transactions.
|
| |  | Due to the absence of a clear policy from the Argentine authorities
regarding loans repayments, BLADEX began extending the maturity dates on a
short-term basis of certain Argentine loans that matured during December
2001 and early January 2002. Because of the continued absence of a policy
regarding loan repayments (even after the re-opening of the foreign
exchange market in Argentina after a period of closure of approximately
three weeks) and uncertainty regarding the transferability of funds abroad
to service debt payments, in mid-January 2002 BLADEX decided to stop
extending the maturity dates of Argentine loans and to classify Argentine
loans that remain unpaid at maturity as past due loans. At February 5,
2002, the Bank had past due credit exposure from Argentine borrowers for
approximately US$130 million.                                         

---

F-19



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



|    |  | Repayment problems with the Banks Argentine loans could result from the
deterioration of economic conditions and from government-imposed payment
restrictions. The quality of the Banks private sector loans including
loans to banks and corporations in Argentina, could be adversely affected
after four years of economic recession and the current crisis. It is
unclear how payment behavior will evolve, given that the authorities are
controlling the transfer of dollars outside of Argentina. In this
environment, the Bank may have to renegotiate and restructure loans. At
December 31, 2001, the Bank had total allowance for credit losses (loans
and contingencies) of US$195 million, which it believed to be adequate to
absorb probable losses inherent in the loan and commitment portfolio based
upon known and available information, and stockholders equity of US$598
million.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|    |  | The political and economic situation of Argentina, over which the Bank has
no control, could have a material adverse effect on the Banks business,
financial condition, results of operations and prospects. The Bank will
continue to monitor developments in Argentina closely and intends to take
the appropriate steps as more information and clarity on the governments
actions regarding external debt and their effect on the Bank, become
available.                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   
|(7) |  | Allowance for Credit Losses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   
|    |  | The Bank divides the allowance for credit losses into three components, as
follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   
|    |  | Allowance for Loan Losses:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

|                                 |  |     |  |  |             |              |             |      |             |      |             |   |             |  |            |  
|-------------------------------- |  | --- |  |  | ----------- | ------------ | ----------- | ---- | ----------- | ---- | ----------- | - | ----------- |  | ---------- | -
|                                 |  |     |  |  |             | December 31,
|                                 |  |     |  |  |             |             
|                                 |  |     |  |  |             | 2001         |             | 2000 |             | 1999
|                                 |  |     |  |  |             |              |             |      |             |     
|Balance at beginning of the year |  | US$ |  |  | 110,387,682 |              |             |      | 117,669,683 |      |             |   | 108,753,401 | 
|                                
|                                
|                                
|                                
|Provision                        |  |     |  |  |             |              | 77,144,445  |      |             |      | 8,000,000   |   |             |  | 14,700,000 |  
|                                
|                                
|                                
|                                
|Recoveries                       |  |     |  |  |             |              | 285,914     |      |             |      | 307,134     |   |             |  | 531,013    |  
|                                
|                                
|                                
|                                
|Loans charged-off                |  |     |  |  |             |              | (10,334,393 | )    |             |      | (15,589,135 | ) |             |  | (6,314,731 | )
|                                 |  |     |  |  |             |              |             |      |             |      |             |   |             |  |            |  
|Balance at end of the year       |  | US$ |  |  | 177,483,648 |              |             |      | 110,387,682 |      |             |   | 117,669,683 | 
|                                 |  |     |  |  |             |              |             |      |             |      |             |   |             |  |            |  



| |  | Allowance for Losses on Off Balance Sheet Risk:
| |  | -----------------------------------------------

|                                 |  |     |  |  |            |              |   |      |            |      |            |  |           |  |           | 
|-------------------------------- |  | --- |  |  | ---------- | ------------ | - | ---- | ---------- | ---- | ---------- |  | --------- |  | --------- | 
|                                 |  |     |  |  |            | December 31,
|                                 |  |     |  |  |            |             
|                                 |  |     |  |  |            | 2001         |   | 2000 |            | 1999
|                                 |  |     |  |  |            |              |   |      |            |     
|Balance at beginning of the year |  | US$ |  |  | 17,200,000 |              |   |      | 6,000,000  |      |            |  | 0         | 
|                                
|                                
|                                
|                                
|Provision                        |  |     |  |  |            |              | 0 |      |            |      | 11,200,000 |  |           |  | 6,000,000 | 
|                                 |  |     |  |  |            |              |   |      |            |      |            |  |           |  |           | 
|Balance at end of the year       |  | US$ |  |  | 17,200,000 |              |   |      | 17,200,000 |      |            |  | 6,000,000 | 
|                                 |  |     |  |  |            |              |   |      |            |      |            |  |           |  |           | 

---

F-20



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##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | Allowance for losses on guarantees (potential credit and market losses on
options) (see note 17):
| |  | -------------------------------------------------------------------------------------------------

|                                          |  |     |  |  |           |              |            |      |           |      |            |   |            |  |             |  
|----------------------------------------- |  | --- |  |  | --------- | ------------ | ---------- | ---- | --------- | ---- | ---------- | - | ---------- |  | ----------- | -
|                                          |  |     |  |  |           | December 31,
|                                          |  |     |  |  |           |             
|                                          |  |     |  |  |           | 2001         |            | 2000 |           | 1999
|                                          |  |     |  |  |           |              |            |      |           |     
|Balance at beginning of the year          |  | US$ |  |  | 5,025,223 |              |            |      | 6,837,723 |      |            |   | 18,416,111 | 
|                                         
|                                         
|                                         
|                                         
|Reclassification due to SFAS
133 adoption |  |     |  |  |           |              | (5,025,223 | )    |           |      | 0          |   |            |  | 0           |  
|                                         
|                                         
|                                         
|                                         
|Guarantees charged-off                    |  |     |  |  |           |              | 0          |      |           |      | (1,812,500 | ) |            |  | (11,578,388 | )
|                                          |  |     |  |  |           |              |            |      |           |      |            |   |            |  |             |  
|Balance at end of the year                |  | US$ |  |  | 0         |              |            |      | 5,025,223 |      |            |   | 6,837,723  | 
|                                          |  |     |  |  |           |              |            |      |           |      |            |   |            |  |             |  



| |  | The allowance for loan losses is presented in the balance sheets as a
reduction from loans and the allowance for losses on off balance sheet
credit risk and for losses on guarantees are both presented in the balance
sheet within other liabilities.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | The allowance for credit losses reflects managements judgment of the level
of allowance to provide for losses inherent in the credit portfolio, based
upon the political and macroeconomic conditions in the countries of the
Region to which the Bank lends, the nature and characteristics of the
Banks credit portfolio which is mostly unsecured and contains some large
individual loans, as well as significant country concentrations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
| |  | The Banks estimate of losses on impaired loans considered all available
evidence including, as appropriate, the present value of expected future
cash flows discounted at the loans contractual effective rate, the
secondary market value of the loan, the fair value of the collateral, and
environmental factors.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|
| |  | In addition, the Bank maintains additional credit loss reserves for
probable losses on the entire credit portfolio of the Bank net of
criticized and impaired credits. On a quarterly basis, the Bank estimates
probable credit losses using a provisioning matrix model which
differentiates the risk into three categories and aggregates the sum of the
following three factors: country risk, borrower risk and transaction type
risk. To determine the probability of loss due to country risk, the Bank
uses sovereign ratings of well-known independent rating agencies. For
borrower risk, the Bank uses the probability of default matrix of a
well-known rating agency. The Bank evaluates the transaction risk mainly
by taking into account whether the risk is a trade transaction or
otherwise. This model is a tool to estimate and validate the levels of
reserves required, since it does not take into account all variables
affecting asset quality. Therefore, the Bank also reviews the adequacy of
reserves, taking into account regional political, financial and economic
trends affecting the portfolio, delinquency trends, volatility and
significant concentrations that are not fully reflected in the model, and
then adjust the level of required reserves accordingly as of the end of
each quarterly period.

---

F-21



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



|(8) |  | Premises and Equipment                             
|--- |  | ---------------------------------------------------
|   
|    |  | The detail of premises and equipment is as follows:

|                              |  |     |  |  |           |              |            |      |           |  |            | 
|----------------------------- |  | --- |  |  | --------- | ------------ | ---------- | ---- | --------- |  | ---------- | 
|                              |  |     |  |  |           | December 31,
|                              |  |     |  |  |           |             
|                              |  |     |  |  |           | 2001         |            | 2000
|                              |  |     |  |  |           |              |            |     
|Land                          |  | US$ |  |  | 462,176   |              |            |      | 462,176   | 
|                             
|                             
|                             
|                             
|Building and improvements     |  |     |  |  |           |              | 4,092,202  |      |           |  | 4,062,573  | 
|                             
|                             
|                             
|                             
|Furniture and equipment       |  |     |  |  |           |              | 7,637,085  |      |           |  | 7,599,683  | 
|                              |  |     |  |  |           |              |            |      |           |  |            | 
|                              |  |     |  |  |           |              | 12,191,463 |      |           |  | 12,124,432 | 
|                             
|                             
|                             
|                             
|Less accumulated depreciation |  |     |  |  |           |              | 6,713,682  |      |           |  | 7,622,974  | 
|                              |  |     |  |  |           |              |            |      |           |  |            | 
|                              |  | US$ |  |  | 5,477,781 |              |            |      | 4,501,458 | 
|                              |  |     |  |  |           |              |            |      |           |  |            | 



|    |  | Other operating expenses in the consolidated statements of income include
depreciation of US$1,194,768 in 2001, US$1,141,924 in 2000 and US$1,084,720
in 1999. The estimated original useful life is 40 years for building and 3
to 5 years for furniture and equipment.
|--- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(9) |  | Deposits                                                                                                                                                                                                                                                                
|   
|    |  | The maturities of deposits are summarized as follows:                                                                                                                                                                                                                   

|                                       |                              |     |     |  |               |               |              |             |               |               |  |             | 
|-------------------------------------- | ---------------------------- | --- | --- |  | ------------- | ------------- | ------------ | ----------- | ------------- | ------------- |  | ----------- | 
|                                       |                              |     |     |  |               |               | December 31,
|                                       |                              |     |     |  |               |               |             
|                                       |                              |     |     |  |               |               | 2001         |             | 2000         
|                                       |                              |     |     |  |               |               |              |             |              
|                                       | Up to 1 month                |     | US$ |  |               | 1,128,658,255 |              |             |               | 1,202,878,891 | 
|                                      
|                                      
|                                      
|                                      
|                                       | From 1 month to 3 months     |     |     |  |               |               |              | 372,450,984 |               |               |  | 466,922,855 | 
|                                      
|                                      
|                                      
|                                      
|                                       | From 3 months to 6 months    |     |     |  |               |               |              | 44,000,000  |               |               |  | 74,000,000  | 
|                                      
|                                      
|                                      
|                                      
|                                       | From 6 months to 1 year      |     |     |  |               |               |              | 7,500,000   |               |               |  | 40,000      | 
|                                      
|                                      
|                                      
|                                      
|                                       | Over 1 year                  |     |     |  |               |               |              | 18,750,000  |               |               |  | 0           | 
|                                       |                              |     |     |  |               |               |              |             |               |               |  |            
|                                       |                              | US$ |     |  | 1,571,359,239 |               |              |             | 1,743,841,746 |              
|                                       |                              |     |     |  |               |               |              |             |               |               |  |            
|Deposits of US$100,000 or more:        |                              |     |     |  |               |               |              |             |               |               |  |            
|                                      
|                                      
|                                      
|                                      
|                                       | Aggregate amount of deposits |     | US$ |  |               | 1,569,367,264 |              |             |               | 1,738,071,800 | 
|                                      
|                                      
|                                      
|                                      
|Deposits in offices outside of Panama: |                              |     |     |  |               |               |              |             |               |               |  |            
|                                      
|                                      
|                                      
|                                      
|                                       | Aggregate amount of deposits |     | US$ |  |               | 475,477,282   |              |             |               | 468,581,149   | 
|                                      
|                                      
|                                      
|                                      
|                                       | Interest expense             |     | US$ |  |               | 26,200,966    |              |             |               | 28,986,534    | 

---

F-22





---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



|(10) |  | Short-term Borrowings and Placements                                                               
|---- |  | ---------------------------------------------------------------------------------------------------
|    
|     |  | The breakdown of short-term borrowings and placements from banks and other
investors is as follows:

|                                     |                                             |                                                                               |     |     |               |   |               |               |               |            |               |               |               | 
|------------------------------------ | ------------------------------------------- | ----------------------------------------------------------------------------- | --- | --- | ------------- | - | ------------- | ------------- | ------------- | ---------- | ------------- | ------------- | ------------- | 
|                                     |                                             |                                                                               |     |     |               |   |               | December 31, 
|                                     |                                             |                                                                               |     |     |               |   |               |              
|                                     |                                             |                                                                               |     |     |               |   |               | 2001          |               | 2000      
|                                     |                                             |                                                                               |     |     |               |   |               |               |               |           
|Borrowings:                          |                                             |                                                                               |     |     |               |   |               |               |               |            |               |              
|                                    
|                                    
|                                    
|                                    
|At floating interest rates:          |                                             |                                                                               |     |     |               |   |               |               |               |            |               |              
|                                    
|                                    
|                                    
|                                    
|                                     | Advances from banks                         |                                                                               | US$ |     |               | 0 |               |               |               | 15,000,000 |              
|                                    
|                                    
|                                    
|                                    
|                                     | Syndicated borrowings                       |                                                                               |     |     |               |   |               | 0             |               |            |               | 72,500,000    |              
|                                     |                                             |                                                                               |     |     |               |   |               |               |               |            |               |              
|                                     |                                             | Total floating interest
rate borrowings                                       |     |     |               |   |               |               | 0             |            |               |               | 87,500,000    | 
|                                     |                                             |                                                                               |     |     |               |   |               |               |               |            |               |              
|At fixed interest rates:             |                                             |                                                                               |     |     |               |   |               |               |               |            |               |              
|                                    
|                                    
|                                    
|                                    
|                                     | Advances from banks                         |                                                                               |     |     |               |   |               | 1,277,310,000 |               |            |               | 1,127,580,749 |              
|                                    
|                                    
|                                    
|                                    
|                                     | Discounted acceptances                      |                                                                               |     |     |               |   |               | 50,000,000    |               |            |               | 31,800,000    |              
|                                    
|                                    
|                                    
|                                    
|                                     | Securities sold under repurchase
agreements |                                                                               |     |     |               |   |               | 407,728,256   |               |            |               | 158,597,830   |              
|                                     |                                             |                                                                               |     |     |               |   |               |               |               |            |               |              
|                                     |                                             | Total fixed interest rate
borrowings                                          |     |     |               |   |               |               | 1,735,038,256 |            |               |               | 1,317,978,579 | 
|                                     |                                             |                                                                               |     |     |               |   |               |               |               |            |               |              
|                                     |                                             | Total borrowings                                                              |     |     |               |   |               |               | 1,735,038,256 |            |               |               | 1,405,478,579 | 
|                                     |                                             |                                                                               |     |     |               |   |               |               |               |            |               |              
|Placements:                          |                                             |                                                                               |     |     |               |   |               |               |               |            |               |              
|                                    
|                                    
|                                    
|                                    
|At floating interest rates:          |                                             |                                                                               |     |     |               |   |               |               |               |            |               |              
|                                    
|                                    
|                                    
|                                    
|                                     | Short-term euro notes                       |                                                                               |     |     |               |   |               | 15,202,189    |               |            |               | 28,000,000    |              
|                                    
|                                    
|                                    
|                                    
|At fixed interest rates:             |                                             |                                                                               |     |     |               |   |               |               |               |            |               |              
|                                    
|                                    
|                                    
|                                    
|                                     | Euro commercial paper                       |                                                                               |     |     |               |   |               | 73,083,183    |               |            |               | 76,401,628    |              
|                                     |                                             |                                                                               |     |     |               |   |               |               |               |            |               |              
|                                     |                                             | Total placements                                                              |     |     |               |   |               |               | 88,285,372    |            |               |               | 104,401,628   | 
|                                     |                                             |                                                                               |     |     |               |   |               |               |               |            |               |              
|                                     |                                             | Total short-term borrowings
and placements outstanding
at the end of the year |     | US$ |               |   | 1,823,323,628 |               |               |            | 1,509,880,207 |              
|                                     |                                             |                                                                               |     |     |               |   |               |               |               |            |               |              
|Average outstanding during the year  |                                             | US$                                                                           |     |     | 1,704,251,945 |   |               |               | 1,258,491,427 |           
|                                    
|                                    
|                                    
|                                    
|Maximum outstanding at any month end |                                             | US$                                                                           |     |     | 1,880,007,077 |   |               |               | 1,510,216,412 |           

---

F-23





---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



|     |  | The Banks activities to obtain funds include a program for issuance of
Euro Commercial Paper and Euro Certificates of Deposit, which in 1995 was
increased up to a maximum of US$750 million. This program may be used by
the Bank or its subsidiary in Grand Cayman to issue commercial paper or
certificates of deposit with a maturity between 7 and 365 days, bearing
interest or at a discount, for a minimum of US$10,000 on each issue and in
various currencies. The sales are carried generally through one or various
financial institutions authorized to that effect. The program has a global
distribution through bearer notes issued by the issuing and paying agent.
With respect to issuance of Certificates of Deposit, these may only be
issued by the Banks subsidiary in Grand Cayman.
|---- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    
|     |  | In 2001 and 2000, short-term Euro Medium-Term Notes were also issued (see
note 11).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    
|(11) |  | Medium and Long-term Borrowings and Placements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    
|     |  | The breakdown of medium and long-term borrowings and placements (original
maturity of more than one year) is as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

|                                     |                                                                                                                                    |                                                                                         |                  |                  |               |               |               |               |               |              |               |             |  |  |             | 
|------------------------------------ | ---------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------- | ---------------- | ---------------- | ------------- | ------------- | ------------- | ------------- | ------------- | ------------ | ------------- | ----------- |  |  | ----------- | 
|                                     |                                                                                                                                    |                                                                                         |                  |                  |               |               |               |               |               | December 31,
|                                     |                                                                                                                                    |                                                                                         |                  |                  |               |               |               |               |               |             
|                                     |                                                                                                                                    |                                                                                         |                  |                  |               |               |               |               |               | 2001         |               | 2000       
|                                     |                                                                                                                                    |                                                                                         |                  |                  |               |               |               |               |               |              |               |            
|Borrowings:                          |                                                                                                                                    |                                                                                         |                  |                  |               |               |               |               |               |              |               |            
|                                    
|                                    
|                                    
|                                    
|At floating interest rates:          |                                                                                                                                    |                                                                                         |                  |                  |               |               |               |               |               |              |               |            
|                                    
|                                    
|                                    
|                                    
|                                     | Syndicated and other medium-term borrowings
from various international banks, with due
dates from January 2002 until December 2004 |                                                                                         | US$              |                  |               | 1,108,201,543 |               |               |               | 600,600,000  |              
|                                     |                                                                                                                                    |                                                                                         |                  |                  |               |               |               |               |               |              |               |            
|                                     |                                                                                                                                    |                                                                                         | Total borrowings |                  | US$           |               |               | 1,108,201,543 |               |              |               | 600,600,000 | 
|                                     |                                                                                                                                    |                                                                                         |                  |                  |               |               |               |               |               |              |               |            
|Placements:                          |                                                                                                                                    |                                                                                         |                  |                  |               |               |               |               |               |              |               |            
|                                    
|                                    
|                                    
|                                    
|At floating interest rates:          |                                                                                                                                    |                                                                                         |                  |                  |               |               |               |               |               |              |               |            
|                                    
|                                    
|                                    
|                                    
|                                     | Euro medium-term notes with various
maturities, with due dates from April 2002
until May 2006                                      |                                                                                         | US$              |                  |               | 395,520,192   |               |               |               | 645,549,486  |              
|                                    
|                                    
|                                    
|                                    
|At fixed interest rates:             |                                                                                                                                    |                                                                                         |                  |                  |               |               |               |               |               |              |               |            
|                                    
|                                    
|                                    
|                                    
|                                     | Euro medium-term notes with various
maturities, with due dates from May 2002 until
September 2005                                  |                                                                                         |                  |                  |               |               |               | 283,439,584   |               |              |               | 336,330,000 | 
|                                     |                                                                                                                                    |                                                                                         |                  |                  |               |               |               |               |               |              |               |            
|                                     |                                                                                                                                    |                                                                                         |                  | Total placements |               |               |               |               |               |              | 678,959,776   |             |  |  | 981,879,486 | 
|                                     |                                                                                                                                    |                                                                                         |                  |                  |               |               |               |               |               |              |               |            
|                                     |                                                                                                                                    | Total medium and long-term
borrowings and placements
outstanding at the end of the year |                  | US$              |               |               | 1,787,161,319 |               |               |              | 1,582,479,486 |            
|                                     |                                                                                                                                    |                                                                                         |                  |                  |               |               |               |               |               |              |               |            
|Average outstanding during the year  |                                                                                                                                    | US$                                                                                     |                  |                  | 1,714,441,267 |               |               |               | 1,296,549,431 |             
|                                    
|                                    
|                                    
|                                    
|Maximum outstanding at any month end |                                                                                                                                    | US$                                                                                     |                  |                  | 1,837,870,892 |               |               |               | 1,582,479,486 |             

---

F-24





---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---

|                            |                                                       |  |              |      |      |  |  |      |  
|--------------------------- | ----------------------------------------------------- |  | ------------ | ---- | ---- |  |  | ---- | -
|                            |                                                       |  | December 31,
|                            |                                                       |  |             
|                            |                                                       |  | 2001         |      | 2000
|                            |                                                       |  |              |      |     
|At floating interest rates: |                                                       |  |              |      |      |  |  |     
|                           
|                           
|                           
|                           
|                            | Weighted average interest rate at the end of the year |  |              | 3.16 | %    |  |  | 7.50 | %
|                           
|                           
|                           
|                           
|                            | Weighted average interest rate during the year        |  |              | 5.18 | %    |  |  | 7.32 | %
|                           
|                           
|                           
|                           
|At fixed interest rates:    |                                                       |  |              |      |      |  |  |     
|                           
|                           
|                           
|                           
|                            | Weighted average interest rate at the end of the year |  |              | 5.73 | %    |  |  | 7.35 | %
|                           
|                           
|                           
|                           
|                            | Weighted average interest rate during the year        |  |              | 5.79 | %    |  |  | 6.74 | %



| |  | The future maturities of medium and long-term borrowings and placements are
as follows:
| |  | ---------------------------------------------------------------------------------------

|     |  |     |  |  |               |              |             |      |               |  |             | 
|---- |  | --- |  |  | ------------- | ------------ | ----------- | ---- | ------------- |  | ----------- | 
|     |  |     |  |  |               | December 31,
|     |  |     |  |  |               |             
|     |  |     |  |  |               | 2001         |             | 2000
|     |  |     |  |  |               |              |             |     
|2001 |  | US$ |  |  | 0             |              |             |      | 561,875,000   | 
|    
|    
|    
|    
|2002 |  |     |  |  |               |              | 671,230,989 |      |               |  | 603,630,000 | 
|    
|    
|    
|    
|2003 |  |     |  |  |               |              | 782,669,732 |      |               |  | 332,000,000 | 
|    
|    
|    
|    
|2004 |  |     |  |  |               |              | 261,858,956 |      |               |  | 29,876,486  | 
|    
|    
|    
|    
|2005 |  |     |  |  |               |              | 52,401,642  |      |               |  | 55,098,000  | 
|    
|    
|    
|    
|2006 |  |     |  |  |               |              | 19,000,000  |      |               |  | 0           | 
|     |  |     |  |  |               |              |             |      |               |  |             | 
|     |  | US$ |  |  | 1,787,161,319 |              |             |      | 1,582,479,486 | 
|     |  |     |  |  |               |              |             |      |               |  |             | 

The Banks funding activities include a placement program of Euro
Medium-Term Notes, which in June of 1999 was increased by US$750 million to
a maximum of US$2,250 million. The program may be used to issue notes from
90 days up to a maximum of 30 years, at fixed, floating or discount
interest and in various currencies. The sales of the issues are carried
generally through one or more financial institutions authorized to that
effect. The program has a global distribution through bearer or registered
notes or a combination thereof, issued by the issuing and paying agent.

---

F-25





---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



|(12) |  | Redeemable Preferred Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|---- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    
|     |  | The authorized redeemable preferred stock consists of 5,000,000 shares of
US$10 par value per share, totaling US$50,000,000. The minimum 8%
cumulative participating preferred stock issue was authorized on April 30,
1986. At December 31, 2001 and 2000, the issued and outstanding shares
were 1,523,196 and 1,581,038, respectively. In 2001 and 2000, 57,842 and
108,342 shares were repurchased, and a surplus of US$120,453 and US$195,012
was paid in 2001 and 2000, respectively. Normally, the preferred stock is
non-voting, except when the minimum dividends are not paid and certain
other conditions are not complied with, in which case, the preferred
stockholders have the right to elect a Director, and receive a minimum
preferred dividend of 8%, which payment is subject to the approval of the
Board of Directors, and in case of a liquidation receive first preference
at U$10.00 per share, plus accrued and unpaid dividends. The preferred
shares will be redeemed at their par value by means of a sinking fund
designed to retire twenty percent of the aggregate par value of the
preferred shares outstanding as of March 15, 2002, and on May 15 in each of
the subsequent years up to 2006. The preferred shares to be redeemed will
be chosen by the Transfer Agent by lot or by an alternative method deemed
fair by the Transfer Agent.
|    
|     |  | The retained earnings at the end of each of the years in the three-year
period ended December 31, 2001, include the minimum dividend of 8%
corresponding to the preferred shares in each period, which is subject to
approval in order to be appropriated and paid to the preferred stockholders
in the following year (see note 15).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    
|(13) |  | Common Stock                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    
|     |  | In April of 2000, the shareholders authorized the modification of the
Banks authorized capital to 75,000,000 shares comprised of 70,000,000
shares of Class A, B and E no par value common stock and 5,000,000
redeemable preferred shares (see note 12).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    
|     |  | The common stock of the Bank is divided into three classes:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     



| | 1) |  | Class Ashares may only be issued to Latin American Central
Banks or banks in which the state or other government agencies is the
majority shareholder.
| | -- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | 2) |  | Class Bshares may only be issued in the name of banks or
financial institutions.                                                                      
|
| | 3) |  | Class Eshares may be issued in the name of any person whether
a natural person or a legal entity.                                                     



| |  | Pursuant to the amendment of the Articles of Incorporation approved on
April 28, 2000, the then current Class Bshares and Class Cshares were
consolidated into a new class of common stock, the new Class B shares,
with the purpose of simplifying the structure of the Bank.
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

F-26





---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | Before the amendment of Class Cshares, the holders were entitled to
convert their shares into Class Eshares with a ten percent (10%)
discount. The amendment to Article 5 of the Articles of Incorporation gave
the holders of the new Class Bshares the right to convert or exchange
their Class Bshares, at any time and without restriction, for Class E
shares, at a rate of one (1) new Class B share for one (1) Class E
share, without a discount. Class Eshares issued in exchange for
existing Class B and Class Cshares which have not been outstanding for
at least two years (including newly issued Class Bshares) will not
(unless they are registered by the Corporation under the U.S. Securities
Act of 1933, as amended) be freely tradable in the New York Stock Exchange
until the end of a two-year holding period, which will include the holding
period of the Class B or Class Cshares for which the Class Eshares
are exchanged.
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | The detail of common stock is as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

|                                                                            |  |       |              |   |  |   |              |       |  |  |              |  |  |  |               | 
|--------------------------------------------------------------------------- |  | ----- | ------------ | - |  | - | ------------ | ----- |  |  | ------------ |  |  |  | ------------- | 
|                                                                            |  | Class |              |   |  |  
|                                                                            |  |       |              |   |  |  
|                                                                            |  | A     |              | B |  | E |              | Total
|                                                                            |  |       |              |   |  |   |              |      
|Capital                                                                     |  |       |              |   |  |   |              |       |  |  |              |  |  |  |               | 
|                                                                           
|                                                                           
|                                                                           
|                                                                           
|Authorized number of common
shares, without par value,
at December 31, 2001 |  |       | 20,000,000   |   |  |   | 20,000,000   |       |  |  | 30,000,000   |  |  |  | 70,000,000    | 
|                                                                            |  |       |              |   |  |   |              |       |  |  |              |  |  |  |               | 
|Number of outstanding
shares at December 31, 2001                           |  |       | 4,911,185.16 |   |  |   | 4,247,212.55 |       |  |  | 8,182,440.00 |  |  |  | 17,340,837.71 | 
|                                                                            |  |       |              |   |  |   |              |       |  |  |              |  |  |  |               | 

|               |                                                                |  |           |               |   |  |     |  |          |             |         |             |   |             |  |             |  
|-------------- | -------------------------------------------------------------- |  | --------- | ------------- | - |  | --- |  | -------- | ----------- | ------- | ----------- | - | ----------- |  | ----------- | -
|               |                                                                |  | Number    |               |   |  |     |  | Assigned |             | Capital
|               |                                                                |  | of Shares |               |   |  |     |  | Value    |             | Surplus
|               |                                                                |  |           |               |   |  |     |  |          |             |        
|Issued capital |                                                                |  |           |               |   |  |     |  |          |             |         |             |   |             |  |            
|              
|              
|              
|              
|               | Balance at December 31, 1998                                   |  |           | 20,215,804.37 |   |  | US$ |  |          | 134,803,109 |         |             |   | 144,040,400 | 
|              
|              
|              
|              
|               | Issuance of no par value shares at
assigned value during 1999  |  |           | 26,584.10     |   |  |     |  |          |             |         | 177,316     |   |             |  | 326,784     |  
|              
|              
|              
|              
|               | Difference in conversion of Class
Cshares to Class Eshares |  |           | (14,717.50    | ) |  |     |  |          |             |         | (97,675     | ) |             |  | 97,668      |  
|              
|              
|              
|              
|               | Retirement of Class Bshares                                  |  |           | (305,149.00   | ) |  |     |  |          |             |         | (2,034,330  | ) |             |  | (102,958    | )
|               |                                                                |  |           |               |   |  |     |  |          |             |         |             |   |             |  |            
|               | Balance at December 31, 1999                                   |  |           | 19,922,521.97 |   |  |     |  |          |             |         | 132,848,420 |   |             |  | 144,361,894 |  
|              
|              
|              
|              
|               | Issuance of no par value shares at
assigned value during 2000  |  |           | 9,130.21      |   |  |     |  |          |             |         | 60,898      |   |             |  | 170,890     |  
|              
|              
|              
|              
|               | Retirement of Class Bshares                                  |  |           | (8,926.39     | ) |  |     |  |          |             |         | (58,150     | ) |             |  | (10,600     | )
|              
|              
|              
|              
|               | Treasury stock                                                 |  |           | (733,607.46   | ) |  |     |  |          |             |         | (4,891,306  | ) |             |  | (15,949,590 | )
|               |                                                                |  |           |               |   |  |     |  |          |             |         |             |   |             |  |            
|               | Balance at December 31, 2000                                   |  |           | 19,189,118.33 |   |  |     |  |          |             |         | 127,959,862 |   |             |  | 128,572,594 |  
|              
|              
|              
|              
|               | Issuance of no par value shares at
assigned value during 2001  |  |           | 4,030.40      |   |  |     |  |          |             |         | 26,882      |   |             |  | 103,482     |  
|              
|              
|              
|              
|               | Treasury stock                                                 |  |           | (1,903,047.88 | ) |  |     |  |          |             |         | (12,692,430 | ) |             |  | (52,100,381 | )
|              
|              
|              
|              
|               | Conversion of Class Bshares                                  |  |           | (3.14         | ) |  |     |  |          |             |         | 931         |   |             |  | (784        | )
|              
|              
|              
|              
|               | Stock option plan                                              |  |           | 50,740.00     |   |  |     |  |          |             |         | 338,437     |   |             |  | 831,438     |  
|               |                                                                |  |           |               |   |  |     |  |          |             |         |             |   |             |  |            
|               | Balance at December 31, 2001                                   |  |           | 17,340,837.71 |   |  | US$ |  |          | 115,633,682 |         |             |   | 77,406,349  | 
|               |                                                                |  |           |               |   |  |     |  |          |             |         |             |   |             |  |            



| |  | All common shares have an assigned value of US$6.67 per share, while the
treasury stock weighted average purchase price during the years ended
December 31, 2001 and 2000 is US$34.05 and US$28.41, respectively.
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

F-27



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | As further discuss, in July 1998 and October 1999, the Banks Board of
Directors approved two Class Bshares repurchase programs for a total of
600,000 Class B common shares. During the years ended December 31, 1999
and 2000, the Bank repurchased under these programs, Class B common
shares with an assigned value of US$2,034,330 and US$58,150, respectively,
and decided to retire such Class B common shares. In addition, during
the year ended December 31, 2000, the Bank repurchased Class B common
shares with an assigned value of US$15,655,231 with the intention to resell
them in the future. These later Class B common shares were classified as
Treasury Stock.
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | In July 1998, the Board of Directors approved a program in which the Bank
would offer to repurchase up to 200,000 of its Class B common shares at a
price that should not exceed 90% of the market value of the Banks Class
E common shares (as quoted on the New York Stock Exchange) or the book
value of all shares of BLADEXs common stock. The first and second
offerings were made for 100,000 shares each, in December 1998 and in March
1999, respectively.                                                                                                                                                                                                                         
|
| |  | The Banks Board of Directors, at a meeting held on October 1, 1999,
approved a program whereby BLADEX could repurchase up to 400,000 of its
Class Bshares, at a price not to exceed 90% of the market price of the
Class Eshares or the book value of all shares of BLADEXs common stock.
The Bank completed one offering on November 12, 1999, for 200,000 Class B
shares issued and outstanding as of October 19, 1999 at a price of US$17.70
per share. The program was cancelled on December 2000 and the remaining
200,000 shares were not offered.                                                                                                                                  

|      |   |                   |               |              |  |             |       |             |   |      |              |              |        |  |              |           |             |  |               |              | 
|----- | - | ----------------- | ------------- | ------------ |  | ----------- | ----- | ----------- | - | ---- | ------------ | ------------ | ------ |  | ------------ | --------- | ----------- |  | ------------- | ------------ | 
|      |   |                   |               |              |  |             |       |             |   |      |              |              |        |  | Issuance     |           | Outstanding
|      |   |                   | Outstanding   |              |  |             |       |             |   |      |              |              | of New |  | December 31,
|Class |   | December 31, 2000 |               | Conversions  |  | Repurchases |       | Shares      |   | 2001
|      |   |                   |               |              |  |             |       |             |   |     
|      | A |                   |               | 5,181,028.04 |  |             |       | 0           |   |      |              | 269,842.88   |        |  |              | 0         |             |  |               | 4,911,185.16 | 
|     
|     
|     
|     
|      | B |                   |               | 4,518,410.29 |  |             |       | (275,228.14 | ) |      |              | 0            |        |  |              | 4,030.40  |             |  |               | 4,247,212.55 | 
|     
|     
|     
|     
|      | E |                   |               | 9,489,680.00 |  |             |       | 275,225.00  |   |      |              | 1,633,205.00 |        |  |              | 50,740.00 |             |  |               | 8,182,440.00 | 
|      |   |                   |               |              |  |             |       |             |   |      |              |              |        |  |              |           |             |  |               |             
|TOTAL |   |                   | 19,189,118.33 |              |  |             | (3.14 | )           |   |      | 1,903,047.88 |              |        |  | 54,770.40    |           |             |  | 17,340,837.71 |             
|      |   |                   |               |              |  |             |       |             |   |      |              |              |        |  |              |           |             |  |               |             



| |  | On December 6, 2000, the Board of Directors approved a stock repurchase
program, an increased dividend payout ratio and a plan to declare and pay
dividends on a quarterly basis, rather than annually. Under the repurchase
program, BLADEX may, from time to time, at the discretion of management,
purchase up to an aggregate of US$75,000,000 Class Eshares on the open
market at the then prevailing market price. BLADEX, may also make one or
more repurchases of up to an aggregate of US$25,000,000 Class A common
shares in privately negotiated transactions at the then prevailing market
price. Repurchase of Class Ashares may not exceed 25% of the number of
shares owned by each Class A shareholder.
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

---

F-28





---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | During the years ended December 31, 2001, and 2000, the Bank repurchased
under this program the following shares:
| |  | -----------------------------------------------------------------------------------------------------------------

|          |  |              |           |        |  |        |  |  |            |  |            |        |         |  |         |     |  |  |           |  |  |  |           | 
|--------- |  | ------------ | --------- | ------ |  | ------ |  |  | ---------- |  | ---------- | ------ | ------- |  | ------- | --- |  |  | --------- |  |  |  | --------- | 
|          |  | December 31,
|          |  |             
|          |  | 2001         |           | 2000  
|          |  |              |           |       
|          |  | Shares       |           | Amount |  | Shares |  |  |            |  |            | Amount
|          |  |              |           |        |  |        |  |  |            |  |            |       
|Class A |  |              | 269,843   |        |  | US$    |  |  | 9,222,575  |  |            |        | 48,297  |  |         | US$ |  |  | 1,485,144 | 
|         
|         
|         
|         
|Class E |  |              | 1,633,205 |        |  |        |  |  |            |  | 55,570,235 |        |         |  | 117,300 |     |  |  |           |  |  |  | 3,700,521 | 
|          |  |              |           |        |  |        |  |  |            |  |            |        |         |  |         |     |  |  |           |  |  |  |           | 
|          |  |              | 1,903,048 |        |  | US$    |  |  | 64,792,811 |  |            |        | 165,597 |  |         | US$ |  |  | 5,185,665 | 
|          |  |              |           |        |  |        |  |  |            |  |            |        |         |  |         |     |  |  |           |  |  |  |           | 



|(14) |  | Cash and Stock Compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|---- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    
|     |  | Directors                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    
|     |  | On April 28, 2000, the Board of Directors approved a compensation plan that
assigned cash and stock options to Directors. This plan is applicable only
to Directors who do not maintain a labor relationship with BLADEX. In
accordance with the stock option plans for Directors, each year, the Board
of Directors may authorize an option to purchase Class Eshares for each
Director for an equivalent amount of US$10,000 and for the Chairman of the
Board, an equivalent amount of US$15,000.
|    
|     |  | The stocks granted would be at a purchase price equal to 100% of the fair
market value of the common stock covered by such option at the date that
the option is granted. The options granted may be 100% exercised one year
after the date granted and expire on the fifth year after the date
granted.                                                                                                                                                                                              
|    
|     |  | Under this plan, 50,000 Class E common shares were reserved and as of
December 31, 2001, the amount of 2,280 Class E common shares have been
granted under this plan.                                                                                                                                                                                                                                                                                                                             
|    
|     |  | A summary of options granted under this plan, and their exercise rights, is
as follows:                                                                                                                                                                                                                                                                                                                                                                                                               

|                |  |                               |       |  |  |     |  |                 |       |        |  |      |       |                 |  |          |          |  |  |  |          |  |  | 
|--------------- |  | ----------------------------- | ----- |  |  | --- |  | --------------- | ----- | ------ |  | ---- | ----- | --------------- |  | -------- | -------- |  |  |  | -------- |  |  | 
|Options Granted |  | First Tranche Exercise Rights
|                |  |                              
|                |  | No. of                        |       |  |  |     |  |                 |       |        |  |      |       |                 |  | Starting |          |  |  | 
|Date            |  | Shares                        |       |  |  |     |  | Price per Share |       | Amount |  | Date |       | Expiration Date
|                |  |                               |       |  |  |     |  |                 |       |        |  |      |       |                
|02/06/01        |  |                               | 2,584 |  |  | US$ |  |                 | 32.88 |        |  |      | 2,584 |                 |  |          | 02/06/02 |  |  |  | 02/06/06 | 



| |  | In accordance with the guidelines of this plan, a Director, whose term as
director expired without exercising the options, reintegrated 304 shares
during 2001.
| |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------

---

F-29





---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | Officers                                                                                                                                                                                                                                                                                                                                                                                                    
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | On October 13, 1995, the Board of Directors approved the 1995 Stock Option
Plan (the 1995 Plan) for a total of 300,000 Class E common stocks. The
purpose of this Plan is to encourage and enable key employees to acquire a
proprietary interest in the Bank to stimulate their efforts in raising the
corporate performance to higher levels and strengthen their desire to
remain in the Institution.
|
| |  | In accordance with the 1995 Plan, options were granted from time to time at
a purchase price equal to the average fair market value of the common stock
covered by such option on the date that the option was granted. One third
of the options may be exercised on each successive year after the granting
and expire on the tenth year after the granting.                                               
|
| |  | A summary of options granted under the 1995 Plan, and their exercise
rights, is as follows:                                                                                                                                                                                                                                                                                                                 

|                |  |                               |        |           |  |          |  |      |        |          |  |            |          |  |  |  |          |  |  | 
|--------------- |  | ----------------------------- | ------ | --------- |  | -------- |  | ---- | ------ | -------- |  | ---------- | -------- |  |  |  | -------- |  |  | 
|Options Granted |  | First Tranche Exercise Rights
|                |  |                              
|                |  | No. of                        |        | Price per |  |          |  |      |        | Starting |  | Expiration
|Date            |  | Shares                        |        | Share     |  | Amount   |  | Date |        | Date    
|                |  |                               |        |           |  |          |  |      |        |         
|10/13/95        |  |                               | 90,000 |           |  | US$41.56 |  |      | 30,000 |          |  |            | 10/13/96 |  |  |  | 10/12/05 | 
|               
|               
|               
|               
|01/31/97        |  |                               | 70,000 |           |  | US$51.19 |  |      | 23,333 |          |  |            | 01/31/98 |  |  |  | 01/30/07 | 
|               
|               
|               
|               
|02/06/98        |  |                               | 70,000 |           |  | US$42.56 |  |      | 23,333 |          |  |            | 02/06/99 |  |  |  | 02/05/08 | 
|               
|               
|               
|               
|02/04/99        |  |                               | 70,000 |           |  | US$23.03 |  |      | 23,333 |          |  |            | 02/04/00 |  |  |  | 02/03/09 | 
|               
|               
|               
|               
|02/04/00        |  |                               | 37,367 | *         |  | US$23.16 |  |      | 12,456 |          |  |            | 02/04/01 |  |  |  | 02/03/10 | 



| |  |                                                                      
| |  | ---------------------------------------------------------------------
|
| |  | *Options reintegrated and granted                                    
|
| |  | A summary of the status (shares) of the 1995 Plan is presented below:

|                                                               |  |              |         |       |  |          |  |       |         |            |  |          |  |  |         |            |  |          |  |  |  |  |  | 
|-------------------------------------------------------------- |  | ------------ | ------- | ----- |  | -------- |  | ----- | ------- | ---------- |  | -------- |  |  | ------- | ---------- |  | -------- |  |  |  |  |  | 
|                                                               |  | December 31,
|                                                               |  |             
|                                                               |  | 2001         |         | 2000  |  | 1999    
|                                                               |  |              |         |       |  |         
|                                                               |  |              |         |       |  | Weighted |  |       |         |            |  | Weighted |  |  |         |            |  | Weighted
|                                                               |  |              |         |       |  | Average  |  |       |         |            |  | Average  |  |  |         |            |  | Average 
|                                                               |  |              |         |       |  | Exercise |  |       |         |            |  | Exercise |  |  |         |            |  | Exercise
|                                                               |  | Shares       |         | Price |  | Shares   |  | Price |         | Shares     |  | Price   
|                                                               |  |              |         |       |  |          |  |       |         |            |  |         
|Outstanding at beginning
of the year                           |  |              | 280,773 |       |  | US$36.90 |  |       | 250,607 |            |  | US$38.85 |  |  | 184,524 |            |  | US$44.89
|                                                              
|                                                              
|                                                              
|                                                              
|Granted                                                        |  |              | 0       |       |  | 0        |  |       | 37,367  |            |  | US$23.16 |  |  | 70,000  |            |  | US$23.03
|                                                              
|                                                              
|                                                              
|                                                              
|Exercised                                                      |  |              | (50,740 | )     |  | US$23.06 |  |       | 0       |            |  | 0        |  |  | 0       |            |  | 0        | 
|                                                              
|                                                              
|                                                              
|                                                              
|Forfeited                                                      |  |              | (31,400 | )     |  | US$40.80 |  |       | (7,201  | )          |  | US$33.44 |  |  | (3,917  | )          |  | US$40.52
|                                                               |  |              |         |       |  |          |  |       |         |            |  |          |  |  |         |            |  |         
|Outstanding at end of the
year                                 |  |              | 198,633 |       |  | US$39.82 |  |       | 280,773 |            |  | US$36.90 |  |  | 250,607 |            |  | US$38.85
|                                                               |  |              |         |       |  |          |  |       |         |            |  |          |  |  |         |            |  |         
|Options exercisable at
end of the year                         |  |              | 157,721 |       |  | US$44.16 |  |       | 179,523 |            |  | US$42.50 |  |  | 121,557 |            |  | US$44.70
|                                                               |  |              |         |       |  |          |  |       |         |            |  |          |  |  |         |            |  |         
|Weighted average fair
value of options granted
during the year |  |              |         |       |  |          |  |       |         | US$712,215 |  |          |  |  |         | US$744,100 |  |          |  | 
|                                                               |  |              |         |       |  |          |  |       |         |            |  |          |  |  |         |            |  |          |  |  |  |  |  | 

---

F-30



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##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | Information pertaining to options outstanding for the 1995 Stock Option
Plan at December 31, 2001 is as follows:
| |  | ----------------------------------------------------------------------------------------------------------------

|                    |  |             |         |             |  |           |  |             |  |           |         |         |  |          |  |  |  |  |  | 
|------------------- |  | ----------- | ------- | ----------- |  | --------- |  | ----------- |  | --------- | ------- | ------- |  | -------- |  |  |  |  |  | 
|                    |  |             |         |             |  | Weighted  |  |             |  |           |         |         |  |          |  |  |  | 
|                    |  |             |         |             |  | Average   |  | Weighted    |  |           |         |         |  | Weighted
|                    |  |             |         |             |  | Remaining |  | Average     |  | Number of |         | Average
|Range of Exercise   |  | Number      |         | Contractual |  | Exercise  |  | Shares      |  | Exercise 
|Prices              |  | Outstanding |         | Life        |  | Price     |  | Exercisable |  | Prices   
|                    |  |             |         |             |  |           |  |             |  |          
|US$23.03 - US$51.19 |  |             | 198,633 |             |  | 6 years   |  | US$39.82    |  |           | 157,721 |         |  | US$44.16



| |  | On October 1999, a new Class E Stock Option Plan (the 1999 Plan) for
key employees was approved with 350,000 Class E shares reserved for the
implementation of this Plan. The guidelines are the same as the 1995 Plan
with the exception that the right to exercise one third of the option has
been extended to two years, exercisable in full after the fourth year and
expiration date on the tenth year after the granting.
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | A summary of options granted under the 1999 Plan and their exercise rights,
is as follows:                                                                                                                                                                                                                                                                                                                                            

|                |  |                               |        |           |  |          |  |      |        |          |  |            |          |  |  |  |          |  |  | 
|--------------- |  | ----------------------------- | ------ | --------- |  | -------- |  | ---- | ------ | -------- |  | ---------- | -------- |  |  |  | -------- |  |  | 
|Options Granted |  | First Tranche Exercise Rights
|                |  |                              
|                |  | No. of                        |        | Price per |  |          |  |      |        | Starting |  | Expiration
|Date            |  | Shares                        |        | Share     |  | Amount   |  | Date |        | Date    
|                |  |                               |        |           |  |          |  |      |        |         
|02/04/00        |  |                               | 32,633 |           |  | US$23.16 |  |      | 10,878 |          |  |            | 02/04/02 |  |  |  | 02/03/10 | 
|               
|               
|               
|               
|02/06/01        |  |                               | 70,000 |           |  | US$32.88 |  |      | 23,333 |          |  |            | 02/06/03 |  |  |  | 02/06/11 | 



| |  | A summary of the status (shares) of the Banks 1999 Plan is presented
below:
| |  | ----------------------------------------------------------------------------

|                                                               |  |              |            |       |  |          |  |       |        |  |            |          |  |  |  | 
|-------------------------------------------------------------- |  | ------------ | ---------- | ----- |  | -------- |  | ----- | ------ |  | ---------- | -------- |  |  |  | 
|                                                               |  | December 31,
|                                                               |  |             
|                                                               |  | 2001         |            | 2000 
|                                                               |  |              |            |      
|                                                               |  |              |            |       |  | Weighted |  |       |        |  |            | Weighted
|                                                               |  |              |            |       |  | Average  |  |       |        |  |            | Average 
|                                                               |  |              |            |       |  | Exercise |  |       |        |  |            | Exercise
|                                                               |  | Shares       |            | Price |  | Shares   |  | Price
|                                                               |  |              |            |       |  |          |  |      
|Outstanding at beginning of the year                           |  |              | 32,633     |       |  | US$23.16 |  |       | 0      |  |            | 0       
|                                                              
|                                                              
|                                                              
|                                                              
|Granted                                                        |  |              | 70,000     |       |  | US$32.88 |  |       | 32,633 |  |            | US$23.16
|                                                              
|                                                              
|                                                              
|                                                              
|Exercised                                                      |  |              | 0          |       |  | 0        |  |       | 0      |  |            | 0       
|                                                              
|                                                              
|                                                              
|                                                              
|Forfeited                                                      |  |              | (11,950    | )     |  | US$29.67 |  |       | 0      |  |            | 0       
|                                                               |  |              |            |       |  |          |  |       |        |  |            |         
|Outstanding at end of the year                                 |  |              | 90,683     |       |  | US$29.81 |  |       | 32,633 |  |            | US$23.16
|                                                               |  |              |            |       |  |          |  |       |        |  |            |         
|Options exercisable at end of the year                         |  |              | 0          |       |  |          |  |       |        |  | 0          |          |  |  |  | 
|                                                               |  |              |            |       |  |          |  |       |        |  |            |          |  |  |  | 
|Weighted
average fair value of options granted during the year |  |              | US$630,700 |       |  |          |  |       |        |  | US$426,840 |          |  |  |  | 
|                                                               |  |              |            |       |  |          |  |       |        |  |            |          |  |  |  | 

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---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | Information pertaining to options outstanding for the 1999 Plan at December
31, 2001 is as follows:
| |  | ---------------------------------------------------------------------------------------------------

|                    |  |             |        |             |  |           |  |             |  |           |   |         |  |          |   |  |  |  |  | 
|------------------- |  | ----------- | ------ | ----------- |  | --------- |  | ----------- |  | --------- | - | ------- |  | -------- | - |  |  |  |  | 
|                    |  |             |        |             |  | Weighted  |  |             |  |           |   |         |  |          |   |  |  | 
|                    |  |             |        |             |  | Average   |  | Weighted    |  |           |   |         |  | Weighted
|                    |  |             |        |             |  | Remaining |  | Average     |  | Number of |   | Average
|Range of Exercise   |  | Number      |        | Contractual |  | Exercise  |  | Shares      |  | Exercise 
|Prices              |  | Outstanding |        | Life        |  | Price     |  | Exercisable |  | Prices   
|                    |  |             |        |             |  |           |  |             |  |          
|US$23.16 - US$32.88 |  |             | 90,683 |             |  | 9.7 years |  | US$29.81    |  |           | 0 |         |  |          | 0 | 



| |  | In accordance with SFAS No. 123, Accounting for Stock-Based Compensation,
the Bank has elected to continue using the intrinsic value based method of
accounting for the employee stock option plan prescribed by APB Opinion No.
25, Accounting for Stock Issued to Employees. Under the intrinsic value
based method, compensation cost is the excess, if any, of the quoted market
price of the stock at grant date or other measurement date over the amount
an employee must pay to acquire the stock. Since the purchase price at
grant date was equal to the market price, no compensation cost is
recognized. If the Bank had elected to use the fair value based method, it
would have recognized a compensation expense US$468,637 for 2001,
US$881,289 for 2000 and US$322,658 for 1999. The decrease in the diluted
earnings per share would have been approximately US$0.03 in 2001, US$0.05
in 2000 and US$0.02 in 1999.
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | The Bank sponsors a defined contribution plan authorized by the Board of
Directors for certain of its expatriate officers, which as of December 31,
2001 and 2000 cover six (6) and four (4), respectively. The Bank accrues
its contribution to the plan with an amount which is generally determined
as a percentage of the covered officers annual salary and such officers
also contribute with an amount which is withheld from their salary and
deposited in a savings account with the Bank and earns interest at market
rates.                                                                                                                                                                                                                                                                                                                                                                                                  
|
| |  | During the years 2001, 2000 and 1999 the Bank charged to employee expense
the amounts of US$50,764, US$60,000 and US$50,155, respectively. As of
December 31, 2001 and 2000 the accumulated liability payable under this
defined contribution plan amounted to US$312,921 and US$340,323,
respectively.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

---

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##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | In 1999, the Board of Directors approved the adoption of two new employee
stock programs. Currently, the structure for these programs contemplates
the following terms:
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------
|

| | 1) |  | Deferred Equity Unit Plan (the DEU Plan):                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |    |  | The DEU Plan allows eligible employees to elect to invest up to 25% of
their annual profit sharing in Class E shares (the Participation
Shares). If participating employees agree to allow the Bank to
maintain custody over the certificates of the Participating Shares,
the employee receives a grant of one deferred equity unit for every
two Participating Shares. Each deferred equity unit represents the
right to receive a Class E share (or the economic equivalent
thereof). In general terms, the employee will vest in 50% of the
deferred equity units on each of the third and fifth anniversaries of
the date of grant of the deferred equity units if, throughout the
vesting period, the Participating Shares have not been transferred and
the employee remains employed by the Bank. Participating employees
receive dividends with respect to their vested deferred equity units
and receive additional deferred equity units in lieu of a dividend
with respect to their unvested deferred equity units. Distributions
are made in respect of deferred equity units as they vest.                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|
| |    |  | Under the DEU Plan and the Stock Purchase Plan, 30,000 and 60,000
Class E common shares were reserved, respectively. In February
2001, six (6) employees participated under this plan with an
investment equivalent to 246 shares. To this amount correspond 122
deferred equity units (DEU) with the right to be exercised in February
2006, according to the guidelines of this plan. Under this Plan,
US$3,591 was provisioned in 2001.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|
| | 2) |  | Deferred Compensation Plan (the DC Plan):                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|
| |    |  | The DC Plan has two separate features. Under the first component of
the DC Plan, the Bank may grant to each eligible employee a number of
deferred equity units equal to the product of (x) an amount equal to a
percentage, not to exceed 3%, of the employees compensation, divided
by (y) the fair market value of a Class E share of stock of the
Bank. Each deferred equity unit represents the right to receive a
Class E share (or the economic equivalent thereof). Employees will
vest in the deferred equity units after three years of service (which
may be either before or after the deferred equity unit award).
Distributions are made in respect of deferred equity units on the
later of (i) the date the vested deferred equity units are credited to
an employees account and (ii) ten years after the employee is first
credited with deferred equity units under the DC Plan. Participating
employees receive dividends with respect to their vested deferred
equity units, and receive additional deferred equity units in lieu of
a dividend with respect to their unvested deferred equity units. The
second component allows employees who are not citizens or residents of
the United States to defer a percentage of their compensation, and
receive discretionary matching cash contribution. In no event shall
the value of (i) the discretionary matching cash contribution made on
behalf of an employee and (ii) the grant of deferred equity units made
to such employees exceed 6% of the employees annual base
compensation.

---

F-33



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



|     |  | Under the DC Plan, 30,000 Class E common shares were reserved.                                                                                                                                                   
|---- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    
|     |  | During 2001, 4,308 deferred units (DEU) were granted, which can be
exercised beginning February 2011 in accordance with guidelines of
this Plan. The expense provisioned for 2001, under this Plan, was
US$175,798.
|    
|(15) |  | Earnings Per Share                                                                                                                                                                                                 
|    
|     |  | Earnings per share disclosures for each period (after surplus paid and
dividends on preferred stock) are detailed as follows:                                                                                      

|                                                        |                            |     |     |  |           |      |              |   |            |      |            |   |             |      |            |   | 
|------------------------------------------------------- | -------------------------- | --- | --- |  | --------- | ---- | ------------ | - | ---------- | ---- | ---------- | - | ----------- | ---- | ---------- | - | 
|                                                        |                            |     |     |  |           |      | December 31,
|                                                        |                            |     |     |  |           |      |             
|                                                        |                            |     |     |  |           |      | 2001         |   | 2000       |      | 1999      
|                                                        |                            |     |     |  |           |      |              |   |            |      |           
|Earnings per share computation:                         |                            |     |     |  |           |      |              |   |            |      |            |   |             |      |            |  
|                                                       
|                                                       
|                                                       
|                                                       
|Consolidated net income                                 |                            | US$ |     |  | 2,493,697 |      |              |   | 97,055,554 |      |            |   | 101,057,397 |     
|                                                       
|                                                       
|                                                       
|                                                       
|Less surplus paid on preferred
shares purchased         |                            |     |     |  |           |      | (120,453     | ) |            |      | (195,012   | ) |             |      | 0          |  
|                                                       
|                                                       
|                                                       
|                                                       
|Less preferred stock dividend
(minimum dividend of 8%)  |                            |     |     |  |           |      | (1,235,481   | ) |            |      | (1,285,911 | ) |             |      | (1,370,275 | )
|                                                        |                            |     |     |  |           |      |              |   |            |      |            |   |             |      |            |  
|Net income available to common
stockholders (numerator) |                            | US$ |     |  | 1,137,763 |      |              |   | 95,574,631 |      |            |   | 99,687,122  |     
|                                                        |                            |     |     |  |           |      |              |   |            |      |            |   |             |      |            |  
|Weighted average common shares
(denominator)            |                            |     |     |  |           |      | 18,101,751   |   |            |      | 19,782,871 |   |             |      | 20,140,840 |  
|                                                        |                            |     |     |  |           |      |              |   |            |      |            |   |             |      |            |  
|                                                        | Earnings per share         |     | US$ |  |           | 0.06 |              |   |            | 4.83 |            |   |             | 4.95 |           
|                                                        |                            |     |     |  |           |      |              |   |            |      |            |   |             |      |            |  
|Diluted earnings per share
computation:                 |                            |     |     |  |           |      |              |   |            |      |            |   |             |      |            |  
|                                                       
|                                                       
|                                                       
|                                                       
|Net income available to common
stockholders (numerator) |                            | US$ |     |  | 1,137,763 |      |              |   | 95,574,631 |      |            |   | 99,687,122  |     
|                                                        |                            |     |     |  |           |      |              |   |            |      |            |   |             |      |            |  
|Weighted average common shares                          |                            |     |     |  |           |      | 18,101,751   |   |            |      | 19,782,871 |   |             |      | 20,140,840 |  
|                                                       
|                                                       
|                                                       
|                                                       
|Stock-based compensation arrangements                   |                            |     |     |  |           |      | 60,454       |   |            |      | 81,811     |   |             |      | 62,006     |  
|                                                        |                            |     |     |  |           |      |              |   |            |      |            |   |             |      |            |  
|Dilutive potential common shares
(denominator)          |                            |     |     |  |           |      | 18,162,205   |   |            |      | 19,864,682 |   |             |      | 20,202,846 |  
|                                                        |                            |     |     |  |           |      |              |   |            |      |            |   |             |      |            |  
|                                                        | Diluted earnings per share |     | US$ |  |           | 0.06 |              |   |            | 4.81 |            |   |             | 4.93 |           
|                                                        |                            |     |     |  |           |      |              |   |            |      |            |   |             |      |            |  

---

F-34



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | Earnings per share disclosures for each period (after surplus paid and
dividends on preferred stock but before cumulative effect of accounting
change) are detailed, as follows:
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                                                                 |                            |     |     |  |           |      |              |   |            |      |            |  |            |      |            |  | 
|-------------------------------------------------------------------------------- | -------------------------- | --- | --- |  | --------- | ---- | ------------ | - | ---------- | ---- | ---------- |  | ---------- | ---- | ---------- |  | 
|                                                                                 |                            |     |     |  |           |      | December 31,
|                                                                                 |                            |     |     |  |           |      |             
|                                                                                 |                            |     |     |  |           |      | 2001         |   | 2000       |      | 1999      
|                                                                                 |                            |     |     |  |           |      |              |   |            |      |           
|Earnings per share computation:                                                  |                            |     |     |  |           |      |              |   |            |      |            |  |            |      |            | 
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Net income after surplus paid
and dividends on preferred
shares                  |                            | US$ |     |  | 1,137,763 |      |              |   | 95,574,631 |      |            |  | 99,687,122 |     
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Less cumulative effect of
accounting change                                      |                            |     |     |  |           |      | (1,129,413   | ) |            |      | 0          |  |            |      | 0          | 
|                                                                                 |                            |     |     |  |           |      |              |   |            |      |            |  |            |      |            | 
|Net income before cumulative
effect available to common
stockholders (numerator) |                            | US$ |     |  | 8,350     |      |              |   | 95,574,631 |      |            |  | 99,687,122 |     
|                                                                                 |                            |     |     |  |           |      |              |   |            |      |            |  |            |      |            | 
|Weighted average common shares
(denominator)                                     |                            |     |     |  |           |      | 18,101,751   |   |            |      | 19,782,871 |  |            |      | 20,140,840 | 
|                                                                                 |                            |     |     |  |           |      |              |   |            |      |            |  |            |      |            | 
|                                                                                 | Earnings per share         |     | US$ |  |           | 0.00 |              |   |            | 4.83 |            |  |            | 4.95 |           
|                                                                                 |                            |     |     |  |           |      |              |   |            |      |            |  |            |      |            | 
|Diluted earnings per share
computation:                                          |                            |     |     |  |           |      |              |   |            |      |            |  |            |      |            | 
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Net income before cumulative
effect available to common
stockholders (numerator) |                            | US$ |     |  | 8,350     |      |              |   | 95,574,631 |      |            |  | 99,687,122 |     
|                                                                                 |                            |     |     |  |           |      |              |   |            |      |            |  |            |      |            | 
|Weighted average common shares                                                   |                            |     |     |  |           |      | 18,101,751   |   |            |      | 19,782,871 |  |            |      | 20,140,840 | 
|                                                                                
|                                                                                
|                                                                                
|                                                                                
|Stock-based compensation arrangements                                            |                            |     |     |  |           |      | 60,454       |   |            |      | 81,811     |  |            |      | 62,006     | 
|                                                                                 |                            |     |     |  |           |      |              |   |            |      |            |  |            |      |            | 
|Dilutive potential common shares
(denominator)                                   |                            |     |     |  |           |      | 18,162,205   |   |            |      | 19,864,682 |  |            |      | 20,205,846 | 
|                                                                                 |                            |     |     |  |           |      |              |   |            |      |            |  |            |      |            | 
|                                                                                 | Diluted earnings per share |     | US$ |  |           | 0.00 |              |   |            | 4.81 |            |  |            | 4.93 |           
|                                                                                 |                            |     |     |  |           |      |              |   |            |      |            |  |            |      |            | 

---

F-35



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



|(16) |  | Financial Instruments with Off Balance Sheet Financial Risk                                                                                                                                                                                                                                                                                                                                                                                                 
|---- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    
|     |  | The Bank is party to financial instruments with off balance sheet risk in
the normal course of business to meet the financing needs of its customers.
These financial instruments involve, to varying degrees, elements of
credit and market risk in excess of the amount recognized in the balance
sheet. Credit risk represents the possibility of loss resulting from the
failure of another party to perform in accordance with the terms of a
contract.
|    
|     |  | In the normal course of business, the Bank had outstanding financial
instruments with off balance sheet financial risk, as follows:                                                                                                                                                                                                                                                                                                                         

|                                           |                  |     |  |  |             |  |              |             |               |  |             |             | 
|------------------------------------------ | ---------------- | --- |  |  | ----------- |  | ------------ | ----------- | ------------- |  | ----------- | ----------- | 
|                                           |                  |     |  |  |             |  | December 31,
|                                           |                  |     |  |  |             |  |             
|                                           |                  |     |  |  |             |  | 2001         |             | 2000         
|                                           |                  |     |  |  |             |  |              |             |              
|Confirmed letters of credit                |                  | US$ |  |  | 84,711,389  |  |              |             | 80,526,713    | 
|                                          
|                                          
|                                          
|                                          
|Stand-by letters of credit and guarantees: |                  |     |  |  |             |  |              |             |               |  |             |            
|                                          
|                                          
|                                          
|                                          
|                                           | Country risks    |     |  |  |             |  |              | 223,423,964 |               |  |             | 262,793,675 | 
|                                          
|                                          
|                                          
|                                          
|                                           | Commercial risks |     |  |  |             |  |              | 571,362,514 |               |  |             | 796,197,945 | 
|                                          
|                                          
|                                          
|                                          
|Credit commitments                         |                  |     |  |  |             |  | 30,527,034   |             |               |  | 113,529,722 |            
|                                           |                  |     |  |  |             |  |              |             |               |  |             |            
|                                           |                  | US$ |  |  | 910,024,901 |  |              |             | 1,253,048,055 | 
|                                           |                  |     |  |  |             |  |              |             |               |  |             |            



| |  | As of December 31, 2001 the Bank had US$22,142,690 in letters of credit,
US$181,422,244 in issued guarantees, and US$30,687,327 in country risk
coverage, which correspond to the exposure of off balance sheet financial
risk with Argentina.                                                                                                                                                                                                                                                                                                                                                                                             
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | Letters of Credit and Guarantees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|
| |  | The Bank, on behalf of its institutional client base, confirms and advises
letters of credit to facilitate foreign trade transactions. When
confirming letters of credit, the Bank adds its own unqualified assurance
that the issuing bank will pay and that if the letter does not honor drafts
drawn on the credit, the Bank will. These transactions are subject to the
same credit standards used in the lending process.                                                                                                                                                                                                             
|
| |  | The Bank provides stand-by letters of credit and guarantees (including
country risk coverage), which are issued on behalf of institutional
customers in connection with financing between the customers and third
parties. The Bank applies the same credit standards used in the lending
process, and, once issued, the commitment is irrevocable and remains valid
until its expiration. Credit risk arises from the Banks obligation to
make payment in the event of the third partys contractual default. Risks
associated with such stand-by letters of credit and guarantees are included
in the evaluation of overall credit risk.

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##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



|     |  | The Bank issues stand-by letters of credit and guarantees to provide
coverage for country risk arising from the risk of convertibility and
transferability of local currency of countries in the Region into hard
currency. However, in a few cases, the Bank also issues stand-by letters
of credit and guarantees to provide coverage for country risk arising from
political risks, such as appropriation, nationalization, war and/or civil
disturbances.
|---- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    
|     |  | Credit Commitments                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    
|     |  | Commitments to extend credit are a combination of either non-binding or
legal agreements to lend to a customer. Commitments generally have fixed
expiration dates or other termination clauses and may require payment of a
fee to the Bank. As some commitments expire without being drawn down, the
total commitment amounts do not necessarily represent future cash
requirements.                                                                        
|    
|(17) |  | Derivative Financial Instruments                                                                                                                                                                                                                                                                                                                                                                                                                             
|    
|     |  | Effective January 1, 2001, the Bank adopted SFAS No.133 related to the
accounting of financial instruments that are considered to be derivatives
and subsequently these financial instruments are also booked on the balance
sheet at their fair value. For control purposes, these financial
instruments are recorded at their nominal amount (notional amount) on the
memorandum accounts.                                                               
|    
|     |  | In the normal course of business, the Bank had outstanding derivative
financial instruments (notional amounts), as follows:                                                                                                                                                                                                                                                                                                                                  

|                                                  |  |     |  |  |             |              |             |      |             |  |             | 
|------------------------------------------------- |  | --- |  |  | ----------- | ------------ | ----------- | ---- | ----------- |  | ----------- | 
|                                                  |  |     |  |  |             | December 31,
|                                                  |  |     |  |  |             |             
|                                                  |  |     |  |  |             | 2001         |             | 2000
|                                                  |  |     |  |  |             |              |             |     
|Options                                           |  | US$ |  |  | 100,000,000 |              |             |      | 100,000,000 | 
|                                                 
|                                                 
|                                                 
|                                                 
|Interest rate swaps, less set-offs                |  |     |  |  |             |              | 156,000,000 |      |             |  | 190,000,000 | 
|                                                 
|                                                 
|                                                 
|                                                 
|Foreign exchange forward contracts,
less set-offs |  |     |  |  |             |              | 450,422,990 |      |             |  | 345,927,610 | 
|                                                  |  |     |  |  |             |              |             |      |             |  |             | 
|                                                  |  | US$ |  |  | 706,422,990 |              |             |      | 635,927,610 | 
|                                                  |  |     |  |  |             |              |             |      |             |  |             | 



| |  | Options                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | During 1997, the Bank sold a series of options on sovereign risk assets for
a notional value of US$221,391,335. At December 31, 2001, the notional
value of the outstanding options was US$100,000,000. Provisions for
possible losses on these guarantees were established in 1997 and 1998 to
cover the mark-to-market valuation of the underlying assets of the options.
On January 1, 2001 and as a result of the adoption of SFAS 133, the
allowance for losses on guarantees was eliminated and the balance of
US$5,025,223, together with the remaining un-amortized premium received of
US$1,915,833 were transferred to the SFAS 133 transition adjustment of
US$5,582,298 generated by the market valuation of options at that date (see
note 19).

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##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | Derivative Financial Instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | The Bank utilizes derivatives and foreign exchange financial instruments
for its asset/liability activities. All of the forward exchange contracts
entered during 2001 and 2000 were made by the Bank as an end user to hedge
foreign exchange risks arising from the Banks lending activity and the
issuance of non-US dollar short-term Euro Commercial Paper and Euro
Medium-Term Notes. The Bank also engages in some foreign exchange trades
to serve customers transaction needs and all positions are hedged with an
offsetting contract for the same currency. The Bank manages and controls
the risks on these buy and sell foreign currency contracts under approved
limits of amounts and terms by clients, and by having adopted policies that
do not allow it to maintain open positions. Interest rate swaps are made
either in a single currency or cross-currency for a prescribed period to
exchange a series of interest rate flows, which involve fixed for floating
interest payment or vice-versa.
|
| |  | Types of Derivative and Foreign Exchange Instruments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|
| |  | Derivative and foreign exchange instruments negotiated by the Bank are
mainly executed over-the-counter (OTC). These contracts are executed
between two counterparts that negotiate specific agreement terms, including
notional amount, exercise price and maturity.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|
| |  | The following instruments are used by the Bank for purposes of
asset/liability activities:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|
| |  | Interest rate swapsare contracts in which a series of interest rate flows
in a single currency are exchanged over a prescribed period.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
| |  | Cross-currency swapsare contracts that generally involve the exchange of
both interest and principal amounts in two different currencies.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|
| |  | Forward foreign exchangerepresents an agreement to transact on a future
date at agreed-upon terms.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|
| |  | Foreign Exchange Risk Management                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|
| |  | Whenever possible, foreign-currency-denominated assets are funded with
liability instruments denominated in the same currency. In cases where
these assets are funded in different currencies, forward foreign exchange
or cross-currency swap contracts are used to fully hedge the risk due to
this cross-currency funding.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

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##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | Quantitative information on derivative financial instruments outstanding at
December 31, 2001 and 2000 is as follow:
| |  | --------------------------------------------------------------------------------------------------------------------

|                                   |  |     |  |  |             |                 |            |                 |             |      |            |      |            |               |           |  |             |   |            |  
|---------------------------------- |  | --- |  |  | ----------- | --------------- | ---------- | --------------- | ----------- | ---- | ---------- | ---- | ---------- | ------------- | --------- |  | ----------- | - | ---------- | -
|                                   |  |     |  |  |             |                 |            |                 |             |      |            |      |            | Balance Sheet
|                                   |  |     |  |  |             | Notional Amount |            | Credit Exposure
|                                   |  |     |  |  |             |                 |            |                
|                                   |  |     |  |  |             | 2001            |            | 2000            |             | 2001 |            | 2000
|                                   |  |     |  |  |             |                 |            |                 |             |      |            |     
|Interest rate swap
agreements      |  | US$ |  |  | 196,000,000 |                 |            |                 | 270,000,000 |      |            |      | 2,181,606  |               |           |  | 18,038      |  
|                                  
|                                  
|                                  
|                                  
|Less set-offs                      |  |     |  |  |             |                 | 40,000,000 |                 |             |      | 80,000,000 |      |            |               | 2,420,158 |  |             |   | 133,214    |  
|                                   |  |     |  |  |             |                 |            |                 |             |      |            |      |            |               |           |  |             |   |            |  
|                                   |  | US$ |  |  | 156,000,000 |                 |            |                 | 190,000,000 |      |            |      | (238,552   | )             |           |  | (115,176    | )
|                                   |  |     |  |  |             |                 |            |                 |             |      |            |      |            |               |           |  |             |   |            |  
|Foreign exchange
forward contracts |  | US$ |  |  | 511,564,764 |                 |            |                 | 441,388,860 |      |            |      | 36,779,100 |               |           |  | (23,423,303 | )
|                                  
|                                  
|                                  
|                                  
|Less set-offs                      |  |     |  |  |             |                 | 61,141,774 |                 |             |      | 95,461,250 |      |            |               | 5,593,302 |  |             |   | (1,949,127 | )
|                                   |  |     |  |  |             |                 |            |                 |             |      |            |      |            |               |           |  |             |   |            |  
|                                   |  | US$ |  |  | 450,422,990 |                 |            |                 | 345,927,610 |      |            |      | 42,372,402 |               |           |  | (21,474,176 | )
|                                   |  |     |  |  |             |                 |            |                 |             |      |            |      |            |               |           |  |             |   |            |  



| |  | Remaining contracts outstanding at December 31, 2001 with notional
principal amounts less set-offs, are as follow:
| |  | ------------------------------------------------------------------------------------------------------------------

|                                   |  |     |  |  |             |              |  |      |             |      |  |      |             |  |  |  |            |  |  | 
|---------------------------------- |  | --- |  |  | ----------- | ------------ |  | ---- | ----------- | ---- |  | ---- | ----------- |  |  |  | ---------- |  |  | 
|                                   |  |     |  |  |             | December 31,
|                                   |  |     |  |  |             |             
|                                   |  |     |  |  |             | 2001         |  | 2002 |             | 2003 |  | 2004
|                                   |  |     |  |  |             |              |  |      |             |      |  |     
|Interest rate swaps
less set-offs  |  | US$ |  |  | 156,000,000 |              |  |      | 36,000,000  |      |  |      | 0           |  |  |  | 0          | 
|                                   |  |     |  |  |             |              |  |      |             |      |  |      |             |  |  |  |            |  |  | 
|Foreign exchange
forward contracts |  | US$ |  |  | 450,422,990 |              |  |      | 204,583,998 |      |  |      | 126,633,960 |  |  |  | 14,098,000 | 
|                                   |  |     |  |  |             |              |  |      |             |      |  |      |             |  |  |  |            |  |  | 
|Options                            |  | US$ |  |  | 100,000,000 |              |  |      | 0           |      |  |      | 0           |  |  |  | 0          | 
|                                   |  |     |  |  |             |              |  |      |             |      |  |      |             |  |  |  |            |  |  | 



| |  | The interest rate swaps less set-offs, with maturities at different dates
from May 15, 2002 to November 17, 2003, are matched to the maturity dates
of the related Euro Medium-Term Notes issues and to the corresponding
assets held to maturity as part of the Banks credit
portfolio.
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



|(18) |  | Fair Value Disclosure of Financial Instruments                                                                                                                                                                                                                                            
|---- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    
|     |  | The following disclosures represent the Banks best estimate of the fair
value of on and off balance financial instruments. The following
assumptions have been used by management to estimate the fair value of each
class of financial instruments for which it is practicable to do
so:



| | (a) |  | Financial instruments with carrying value equal to fair value                                                                                                                                                                                                                                                                                                                                                                                                                 
| | --- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |     |  | The carrying value of certain financial assets including cash and due
from banks, interest-bearing deposits with banks, securities purchased
under agreements to resell, accrued interest receivable, derivatives
and hedge items, customers liabilities under acceptances and certain
financial liabilities including, interest, taxes and other liabilities
and acceptances outstanding, as a result of their short-term nature,
is considered to be equal to fair value.  
|
| | (b) |  | Investment securities                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|
| |     |  | Fair value has been based upon current market quotations, where
available. If quoted market prices are not available, fair value has
been estimated based upon the quoted price of similar
instruments.                                                                                                                                                                                                                                                                       
|
| | (c) |  | Loans                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|
| |     |  | The fair value of the performing loan portfolio has been determined
principally based upon a discounted analysis of anticipated cash flows
adjusted for expected credit losses. The loans have been grouped to
the extent possible, into homogeneous pools, segregated by maturity
and the weighted average maturity of the loans within each pool.
Depending upon the type of loan involved, maturity assumptions have
been based on either contractual or expected maturity.
|
| |     |  | Credit risk has been factored into the present value analysis of cash
flows associated with each loan type, by allocating the allowance for
credit losses. The allocated portion of the allowance, adjusted by a
present value factor based upon the timing of expected losses, has
been deducted from the gross cash flows prior to calculating the
present value.                                                                                                           
|
| | (d) |  | Deposits                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|
| |     |  | The fair value of demand, savings and time deposits is equal to the
amount payable on demand at the reporting date. For deposits with
fixed maturities, fair value has been estimated based upon interest
rates currently being offered on deposits with similar characteristics
and maturities.                                                                                                                                                                              
|
| | (e) |  | Short-term borrowings and placements                                                                                                                                                                                                                                                                                                                                                                                                                                          
|
| |     |  | Fair values of short-term borrowings and placements, are estimated
using discounted cash flow analysis based on the current incremental
borrowing rates for similar types of borrowing arrangements.                                                                                                                                                                                                                                                                          

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##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| | (f) |  | Medium and long-term borrowings and placements                                                                                                                                                                                                                                                                     
| | --- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |     |  | The fair value of medium and long-term borrowings is estimated using
discounted cash flow analysis based on the current incremental
borrowing rates for similar types of borrowing arrangements.                                                                                                                   
|
| | (g) |  | Derivative financial instruments                                                                                                                                                                                                                                                                                   
|
| |     |  | Fair values for derivatives financial instruments and options, are
based upon quoted market prices.                                                                                                                                                                                                                
|
| |     |  | The following, which is provided for disclosure purposes only,
provides comparison of the carrying value and fair value of the Banks
financial instruments. Fair values have been determined based on
applicable requirements and do not necessarily represent the amount
that would be realized upon liquidation.

|                                                    |  |     |  |  |             |              |               |       |             |          |               |       |             |  |               |  |             |  |               | 
|--------------------------------------------------- |  | --- |  |  | ----------- | ------------ | ------------- | ----- | ----------- | -------- | ------------- | ----- | ----------- |  | ------------- |  | ----------- |  | ------------- | 
|                                                    |  |     |  |  |             | December 31,
|                                                    |  |     |  |  |             |             
|                                                    |  |     |  |  |             | 2001         |               | 2000 
|                                                    |  |     |  |  |             |              |               |      
|                                                    |  |     |  |  |             | Carrying     |               | Fair  |             | Carrying |               | Fair 
|                                                    |  |     |  |  |             | Value        |               | Value |             | Value    |               | Value
|                                                    |  |     |  |  |             |              |               |       |             |          |               |      
|Financial assets:                                   |  |     |  |  |             |              |               |       |             |          |               |       |             |  |               |  |             |  |               | 
|                                                   
|                                                   
|                                                   
|                                                   
|Instruments with carrying
value equal to fair value |  | US$ |  |  | 956,830,652 |              |               |       | 956,830,652 |          |               |       | 423,134,142 |  |               |  | 423,134,142 | 
|                                                   
|                                                   
|                                                   
|                                                   
|Securities available for sale                       |  |     |  |  |             |              | 24,196,913    |       |             |          | 24,196,913    |       |             |  | 10,000,000    |  |             |  | 10,000,000    | 
|                                                   
|                                                   
|                                                   
|                                                   
|Securities held to maturity                         |  |     |  |  |             |              | 337,901,358   |       |             |          | 375,233,901   |       |             |  | 385,458,879   |  |             |  | 390,156,425   | 
|                                                   
|                                                   
|                                                   
|                                                   
|Loans, net of allowance                             |  |     |  |  |             |              | 4,536,105,437 |       |             |          | 4,553,429,579 |       |             |  | 4,806,391,875 |  |             |  | 4,869,794,275 | 
|                                                   
|                                                   
|                                                   
|                                                   
|Financial liabilities:                              |  |     |  |  |             |              |               |       |             |          |               |       |             |  |               |  |             |  |               | 
|                                                   
|                                                   
|                                                   
|                                                   
|Deposits:                                           |  |     |  |  |             |              |               |       |             |          |               |       |             |  |               |  |             |  |               | 
|                                                   
|                                                   
|                                                   
|                                                   
|Without fixed maturities                            |  | US$ |  |  | 71,096,235  |              |               |       | 71,099,650  |          |               |       | 44,824,273  |  |               |  | 44,824,551  | 
|                                                   
|                                                   
|                                                   
|                                                   
|Fixed maturities                                    |  |     |  |  |             |              | 1,500,263,004 |       |             |          | 1,503,389,706 |       |             |  | 1,699,017,473 |  |             |  | 1,713,415,481 | 
|                                                   
|                                                   
|                                                   
|                                                   
|Short-term borrowings and
placements                |  |     |  |  |             |              | 1,823,323,628 |       |             |          | 1,848,122,271 |       |             |  | 1,509,880,207 |  |             |  | 1,541,187,385 | 
|                                                   
|                                                   
|                                                   
|                                                   
|Medium and long-term
borrowings and placements      |  |     |  |  |             |              | 1,787,161,319 |       |             |          | 1,796,498,916 |       |             |  | 1,582,479,486 |  |             |  | 1,602,349,885 | 

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##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



|(19) |  | Impact of SFAS 133 on the Banks Financial Statements                                                                                                                                                                                                                                      
|---- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    
|     |  | SFAS 133, as amended, which deals with the accounting for derivatives, was
adopted on January 1, 2001. The adoption of SFAS 133 affected the
cumulative effect of accounting change account, and the other income
account, both of which, impacted the Statement of Income, as
follows:

|                                                           |                                                                     |       |     |     |           |           |           |                   |        |           |        |         |           |          |           |          |           |           |           |  |  | 
|---------------------------------------------------------- | ------------------------------------------------------------------- | ----- | --- | --- | --------- | --------- | --------- | ----------------- | ------ | --------- | ------ | ------- | --------- | -------- | --------- | -------- | --------- | --------- | --------- |  |  | 
|                                                           |                                                                     |       |     |     |           |           |           | December 31, 2001
|                                                           |                                                                     |       |     |     |           |           |           |                  
|                                                           |                                                                     |       |     |     |           |           |           |                   |        |           |        |         |           |          |           | Interest |           |           |           | 
|                                                           |                                                                     |       |     |     |           |           |           |                   |        |           |        | Forward |           | Rate     |           |          |           |          
|                                                           |                                                                     |       |     |     |           |           |           | Options           |        | Contracts |        | Swaps   |           | Total   
|                                                           |                                                                     |       |     |     |           |           |           |                   |        |           |        |         |           |         
|Cumulative effect of accounting change:                    |                                                                     |       |     |     |           |           |           |                   |        |           |        |         |           |          |           |          |           |           |           | 
|                                                          
|                                                          
|                                                          
|                                                          
|                                                           | Transition adjustment (one time
adjustment made on January 1, 2001) |       | US$ |     |           | 1,358,760 |           |                   |        | 0         |        |         |           | (229,347 | )         |          |           | 1,129,413 |          
|                                                          
|                                                          
|                                                          
|                                                          
|Other income:                                              |                                                                     |       |     |     |           |           |           |                   |        |           |        |         |           |          |           |          |           |           |           | 
|                                                          
|                                                          
|                                                          
|                                                          
|Change in fair value of derivatives
and hedging activities |                                                                     | US$   |     |     | 4,408,581 |           |           |                   | 18,540 |           |        |         | 2,951,649 |          |           |          | 7,378,770 |          
|                                                           |                                                                     |       |     |     |           |           |           |                   |        |           |        |         |           |          |           |          |           |           |           | 
|                                                           |                                                                     | Total |     | US$ |           |           | 5,767,341 |                   |        |           | 18,540 |         |           |          | 2,722,302 |          |           |           | 8,508,183 | 
|                                                           |                                                                     |       |     |     |           |           |           |                   |        |           |        |         |           |          |           |          |           |           |           | 



| |  | Also, the adoption of SFAS 133 affected the other comprehensive income
account in the Banks Consolidated Balance Sheet as
follows:
| |  | -------------------------------------------------------------------------------------------------------------------------------------

|                            |                                                                                                                                 |     |     |  |          |         |                   |          |  
|--------------------------- | ------------------------------------------------------------------------------------------------------------------------------- | --- | --- |  | -------- | ------- | ----------------- | -------- | -
|                            |                                                                                                                                 |     |     |  |          |         | December 31, 2001
|                            |                                                                                                                                 |     |     |  |          |         |                  
|Other comprehensive income: |                                                                                                                                 |     |     |  |          |         |                   |         
|                           
|                           
|                           
|                           
|                            | Transition adjustment related to the
transfer from securities held to maturity to
available for sale, upon adoption of SFAS
133 |     | US$ |  |          | 421,421 |                  
|                           
|                           
|                           
|                           
|                            | Net change in unrealized losses on
derivatives                                                                                  |     |     |  |          |         |                   | (540,696 | )
|                            |                                                                                                                                 |     |     |  |          |         |                   |         
|Other comprehensive loss    |                                                                                                                                 | US$ |     |  | (119,275 | )      
|                            |                                                                                                                                 |     |     |  |          |         |                   |         



|(20) |  | Business Segment Information                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|---- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    
|     |  | The Bank has three segments that it utilizes for management reporting and
analysis purposes: short-term loans, medium-term loans and the
contingencies (letters of credit, guarantees and other fee generating
businesses). These segments are based upon products and services offered
and are identified in a manner consistent with the requirements outlined on
Statement of Financial Accounting Standard No. 131, Disclosures about
Segments of a Enterprise and Related Information. The segment results
show the financial performance of the major business units. These results
are determined based on the Banks management accounting process, which
assigns balance sheet, revenue and expense items to each reportable
business unit on a systematic basis.

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##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



| |  | The short-term loans (original term of up to 365 days) represent the
principal activity of the Bank, and constitute mostly short-term trade
related financing to its stockholders banks and other selected commercial
banks in the Region which then on-lend to businesses engaged in foreign
trade, to state owned export institutions, and to a lesser extent to
private entities.
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  | The medium-term loans (original term of over one to five years, and
exceptionally more than five years) are mainly granted to the Banks
stockholder banks, other selected commercial banks in the Region, and other
state owned and private entities, to support the medium-term financing
needs of the Banks clients.                                                            
|
| |  | The contingencies constitute mainly guarantees issued and stand-by or
commercial letters of credit covering commercial and country risk. This
business is the primary component of fee income generation. Additional
components of other income are commissions earned on loan origination and
the sale of loans derived from the management of the loan
portfolio.                 

|                                 |             |        |       |        |              |        |           |        |       |          |             |           |           |  |       |      |  |  |       |       |     |  |       |      | 
|-------------------------------- | ----------- | ------ | ----- | ------ | ------------ | ------ | --------- | ------ | ----- | -------- | ----------- | --------- | --------- |  | ----- | ---- |  |  | ----- | ----- | --- |  | ----- | ---- | 
|Business Segment Analysis (1)   
|(In US$ millions)               
|                                
|                                 |             |        |       |        |              |        |           |        |       |          | Commissions |           |           |  |       |      |  |  |       |       | Net
|                                 |             |        | Avg.  |        | Net Interest |        | and Other |        | Total |          | Operating   |           | Operating
|2001                             |             | Assets |       | Income |              | Income |           | Income |       | Expenses |             | Income(2)
|                                
|Loans and selected
securities: * |             |        |       |        |              |        |           |        |       |          |             |           |           |  |       |      |  |  |       |       |     |  |       |     
|                                
|                                
|                                
|                                
|                                 | Short-term  |        |       | 3,013  |              |        |           | 63.7   |       |          |             | 0.0       |           |  |       | 63.7 |  |  |       | (12.2 | )   |  |       | 51.5 | 
|                                
|                                
|                                
|                                
|                                 | Medium-term |        |       | 2,530  |              |        |           | 55.1   |       |          |             | (0.8      | )         |  |       | 54.3 |  |  |       | (10.2 | )   |  |       | 44.1 | 
|                                 |             |       
|Loan portfolio                   |             |        | 5,543 |        |              |        | 118.8     |        |       |          | (0.8        | )         |           |  | 118.0 |      |  |  | (22.4 | )     |     |  | 95.6  |     
|                                
|                                
|                                
|                                
|L/C & guarantees                 |             |        | 1,178 |        |              |        | 0.0       |        |       |          | 20.0        |           |           |  | 20.0  |      |  |  | ( 4.0 | )     |     |  | 15.9  |     
|                                 |             |       
|Credit portfolio                 |             |        | 6,721 |        |              |        | 118.8     |        |       |          | 19.1        |           |           |  | 137.9 |      |  |  | (26.4 | )     |     |  | 111.5 |     
|                                



| | *   |  | Includes securities purchased under agreements to resell                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | --- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (1) |  | The numbers set out in these tables have been rounded and
accordingly may not total exactly.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|
| | (2) |  | The net operating income, reported on the preceding tables, does
not include, the following items: (a) the provisions for credit losses
of US$77.1 million, US$19.2 million and US$20.7 million for the years
ended December 31, 2001, 2000 and 1999, respectively; (b) the
impairment loss on securities of US$40.3 million for the year ended
December 31, 2001; (c) cumulative effect of accounting change (SFAS
133) for US$1.1 million for the year ended December 31, 2001; and (d)
derivatives and hedging activities from fair market valuation for
US$7.4 million for the year ended December 31, 2001.

|                               |             |        |       |        |              |        |           |        |       |          |             |           |           |  |       |      |  |  |       |       |     |  |       |      | 
|------------------------------ | ----------- | ------ | ----- | ------ | ------------ | ------ | --------- | ------ | ----- | -------- | ----------- | --------- | --------- |  | ----- | ---- |  |  | ----- | ----- | --- |  | ----- | ---- | 
|                              
|                               |             |        |       |        |              |        |           |        |       |          | Commissions |           |           |  |       |      |  |  |       |       | Net
|                               |             |        | Avg.  |        | Net Interest |        | and Other |        | Total |          | Operating   |           | Operating
|2000                           |             | Assets |       | Income |              | Income |           | Income |       | Expenses |             | Income(2)
|                              
|Loans and selected
securities: |             |        |       |        |              |        |           |        |       |          |             |           |           |  |       |      |  |  |       |       |     |  |       |     
|                              
|                              
|                              
|                              
|                               | Short-term  |        |       | 3,038  |              |        |           | 72.4   |       |          |             | 0.0       |           |  |       | 72.4 |  |  |       | (11.3 | )   |  |       | 61.1 | 
|                              
|                              
|                              
|                              
|                               | Medium-term |        |       | 1,694  |              |        |           | 40.3   |       |          |             | 0.9       |           |  |       | 41.2 |  |  |       | ( 6.3 | )   |  |       | 34.9 | 
|                               |             |       
|Loan portfolio                 |             |        | 4,732 |        |              |        | 112.7     |        |       |          | 0.9         |           |           |  | 113.6 |      |  |  | (17.6 | )     |     |  | 96.0  |     
|                              
|                              
|                              
|                              
|L/C & guarantees               |             |        | 1,306 |        |              |        | 0.0       |        |       |          | 23.9        |           |           |  | 23.9  |      |  |  | ( 3.7 | )     |     |  | 20.3  |     
|                               |             |       
|Credit portfolio               |             |        | 6,037 |        |              |        | 112.7     |        |       |          | 24.8        |           |           |  | 137.5 |      |  |  | (21.2 | )     |     |  | 116.3 |     
|                              

---

F-43



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---

|                               |             |        |       |        |              |        |           |        |       |          |             |           |           |  |       |      |  |  |       |      |     |  |       |      | 
|------------------------------ | ----------- | ------ | ----- | ------ | ------------ | ------ | --------- | ------ | ----- | -------- | ----------- | --------- | --------- |  | ----- | ---- |  |  | ----- | ---- | --- |  | ----- | ---- | 
|                              
|                               |             |        |       |        |              |        |           |        |       |          | Commissions |           |           |  |       |      |  |  |       |      | Net
|                               |             |        | Avg.  |        | Net Interest |        | and Other |        | Total |          | Operating   |           | Operating
|1999                           |             | Assets |       | Income |              | Income |           | Income |       | Expenses |             | Income(2)
|                              
|Loans and selected
securities: |             |        |       |        |              |        |           |        |       |          |             |           |           |  |       |      |  |  |       |      |     |  |       |     
|                              
|                              
|                              
|                              
|                               | Short-term  |        |       | 3,424  |              |        |           | 82.6   |       |          |             | 0.0       |           |  |       | 82.6 |  |  |       | (9.7 | )   |  |       | 72.9 | 
|                              
|                              
|                              
|                              
|                               | Medium-term |        |       | 1,504  |              |        |           | 30.1   |       |          |             | 0.6       |           |  |       | 30.7 |  |  |       | (4.3 | )   |  |       | 26.4 | 
|                               |             |       
|Loan portfolio                 |             |        | 4,928 |        |              |        | 112.7     |        |       |          | 0.6         |           |           |  | 113.3 |      |  |  | (14.0 | )    |     |  | 99.3  |     
|                              
|                              
|                              
|                              
|L/C & guarantees               |             |        | 1,265 |        |              |        | 0.0       |        |       |          | 24.9        |           |           |  | 24.9  |      |  |  | (2.6  | )    |     |  | 22.3  |     
|                               |             |       
|Credit portfolio               |             |        | 6,193 |        |              |        | 112.7     |        |       |          | 25.5        |           |           |  | 138.2 |      |  |  | (16.6 | )    |     |  | 121.6 |     
|                              



| | (21) |  | Leasehold Commitments                                                  
| | ---- |  | -----------------------------------------------------------------------
|
| |      |  | At December 31, 2001, a summary of leasehold commitments is as follows:

|               |      |     |     |  |         |            |               |         | 
|-------------- | ---- | --- | --- |  | ------- | ---------- | ------------- | ------- | 
|               |      |     |     |  |         |            | Future Rental
|December 31,   |      |     |     |  |         | Commitment
|               |      |     |     |  |         |           
|               | 2002 |     | US$ |  |         | 532,301    |              
|              
|              
|              
|              
|               | 2003 |     |     |  |         |            |               | 188,117 | 
|              
|              
|              
|              
|               | 2004 |     |     |  |         |            |               | 51,870  | 
|              
|              
|              
|              
|2005 and later |      |     |     |  |         |            | 51,870        |        
|               |      |     |     |  |         |            |               |        
|               |      | US$ |     |  | 824,158 |           
|               |      |     |     |  |         |            |               |        



|     |  | Occupancy expense for the years ended December 31, 2001, 2000 and 1999,
amounted to US$681,412, US$408,582 and US$170,309, respectively.                                                                                                                                                                                                                                                                                                
|---- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    
|(22) |  | Litigation                                                                                                                                                                                                                                                                                                                                                                                                                              
|    
|     |  | The Bank is not engaged in litigation that is material to the Banks
business, and to the best knowledge of management of the Bank, which is
likely to have a material adverse effect on its business, financial
condition or results of operations.                                                                                                                                                                                    
|    
|(23) |  | Effects of the WTC Events of September 11, 2001                                                                                                                                                                                                                                                                                                                                                                                         
|    
|     |  | The premises of the New York Agency were located at the World Trade
Centers. Due to the events on the September 11, 2001, the offices of the
Agency were permanently destroyed.                                                                                                                                                                                                                                                         
|    
|     |  | All of the fixed assets owned by the Agency with a book value of US$686,170
were transferred to a receivable account. The Agency is in a process of
filing a claim with the insurance company and it is probable that it will
recover at least the book value of fixed assets lost. As of December 31,
2001, the Agency has set up a receivable for losses amounting to US$589,580
and has already received US$100,000 as reimbursement.
|    
|     |  | The Agency had a lease agreement with the Port Authority of New York and
New Jersey under which they were committed to pay US$3,911,398 for the next
9 years. Due to the events of September 11, the lease was effectively
cancelled and the Agency has no commitment under this agreement.                                                                                                                                             

---

F-44



---



##### Table of Contents



BANCO LATINOAMERICANO DE EXPORTACIONES, S. A.
AND SUBSIDIARIES

Notes to Consolidated Financial Statements

---



|(24) |  | Summary of Unaudited Quarterly Financial Information
|---- |  | ----------------------------------------------------

|                                                                                |  |     |  |  |         |        |         |       |        |        |         |       |         |  |         |   |         |  |         |  
|------------------------------------------------------------------------------- |  | --- |  |  | ------- | ------ | ------- | ----- | ------ | ------ | ------- | ----- | ------- |  | ------- | - | ------- |  | ------- | -
|                                                                                |  |     |  |  |         | 2001  
|                                                                                |  |     |  |  |         |       
|(In US$ thousands, except per share data)                                       |  |     |  |  |         | Fourth |         | Third |        | Second |         | First
|                                                                               
|Interest income                                                                 |  | US$ |  |  | 76,702  |        |         |       | 89,996 |        |         |       | 100,631 |  |         |   | 111,125 | 
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Interest expense                                                                |  |     |  |  |         |        | (48,683 | )     |        |        | (61,353 | )     |         |  | (69,165 | ) |         |  | (80,482 | )
|                                                                               
|Net interest income                                                             |  |     |  |  |         |        | 28,019  |       |        |        | 28,643  |       |         |  | 31,466  |   |         |  | 30,643  |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Provision for loan losses                                                       |  |     |  |  |         |        | (65,644 | )     |        |        | (4,000  | )     |         |  | (3,750  | ) |         |  | (3,750  | )
|                                                                               
|Net interest income (expense) after provision for loan losses                   |  |     |  |  |         |        | (37,625 | )     |        |        | 24,643  |       |         |  | 27,716  |   |         |  | 26,893  |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Commission income                                                               |  |     |  |  |         |        | 3,873   |       |        |        | 3,867   |       |         |  | 3,615   |   |         |  | 3,579   |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Commission expense and other charges                                            |  |     |  |  |         |        | (272    | )     |        |        | (306    | )     |         |  | (350    | ) |         |  | (315    | )
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Derivatives and hedging activities                                              |  |     |  |  |         |        | 5,521   |       |        |        | (3,696  | )     |         |  | 4,932   |   |         |  | 622     |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Impairment loss on securities                                                   |  |     |  |  |         |        | (40,356 | )     |        |        | 0       |       |         |  | 0       |   |         |  | 0       |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Gain on sale of securities available for sale                                   |  |     |  |  |         |        | 0       |       |        |        | 1,318   |       |         |  | 2,824   |   |         |  | 656     |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Other income                                                                    |  |     |  |  |         |        | 52      |       |        |        | 103     |       |         |  | 257     |   |         |  | 242     |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Operating expenses                                                              |  |     |  |  |         |        | (7,902  | )     |        |        | (7,022  | )     |         |  | (5,818  | ) |         |  | (5,651  | )
|                                                                               
|Net income (loss) before income tax and
cummulative effect of accounting change |  |     |  |  |         |        | (76,709 | )     |        |        | 18,907  |       |         |  | 33,176  |   |         |  | 26,026  |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Income tax                                                                      |  |     |  |  |         |        | 0       |       |        |        | (5      | )     |         |  | (15     | ) |         |  | (15     | )
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Net income (loss) after income tax                                              |  |     |  |  |         |        | (76,709 | )     |        |        | 18,902  |       |         |  | 33,161  |   |         |  | 26,011  |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Cumulative effect of accounting change (SFAS 133)                               |  |     |  |  |         |        | 0       |       |        |        | 0       |       |         |  | 0       |   |         |  | 1,129   |  
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Net income (loss)                                                               |  | US$ |  |  | (76,709 | )      |         |       | 18,902 |        |         |       | 33,161  |  |         |   | 27,140  | 
|                                                                               
|Net income (loss) available to common stockholders                              |  | US$ |  |  | (77,026 | )      |         |       | 18,588 |        |         |       | 32,850  |  |         |   | 26,833  | 
|                                                                               
|Earnings per share (after dividends on preferred stock)                         |  | US$ |  |  | (4.43   | )      |         |       | 1.05   |        |         |       | 1.78    |  |         |   | 1.42    | 
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Diluted earnings per share                                                      |  | US$ |  |  | (4.43   | )      |         |       | 1.04   |        |         |       | 1.76    |  |         |   | 1.41    | 
|                                                                               
|                                                                               
|                                                                               
|                                                                               
|Average number of common shares outstanding                                     |  |     |  |  |         |        | 17,372  |       |        |        | 17,705  |       |         |  | 18,453  |   |         |  | 18,898  |  

|                                                        |  |     |  |  |         |        |         |       |         |        |         |       |        |  |         |   |        |  |         |  
|------------------------------------------------------- |  | --- |  |  | ------- | ------ | ------- | ----- | ------- | ------ | ------- | ----- | ------ |  | ------- | - | ------ |  | ------- | -
|                                                        |  |     |  |  |         | 2000  
|                                                        |  |     |  |  |         |       
|(In US$ thousands, except per share data)               |  |     |  |  |         | Fourth |         | Third |         | Second |         | First
|                                                       
|Interest income                                         |  | US$ |  |  | 110,492 |        |         |       | 103,658 |        |         |       | 93,738 |  |         |   | 94,698 | 
|                                                       
|                                                       
|                                                       
|                                                       
|Interest expense                                        |  |     |  |  |         |        | (82,061 | )     |         |        | (75,027 | )     |        |  | (66,721 | ) |        |  | (66,107 | )
|                                                       
|Net interest income                                     |  |     |  |  |         |        | 28,431  |       |         |        | 28,631  |       |        |  | 27,017  |   |        |  | 28,591  |  
|                                                       
|                                                       
|                                                       
|                                                       
|Provision for loan losses                               |  |     |  |  |         |        | (4,800  | )     |         |        | (3,200  | )     |        |  | 0       |   |        |  | 0       |  
|                                                       
|Net interest income after provision for loan losses     |  |     |  |  |         |        | 23,631  |       |         |        | 25,431  |       |        |  | 27,017  |   |        |  | 28,591  |  
|                                                       
|                                                       
|                                                       
|                                                       
|Commission income                                       |  |     |  |  |         |        | 5,635   |       |         |        | 6,270   |       |        |  | 6,484   |   |        |  | 7,488   |  
|                                                       
|                                                       
|                                                       
|                                                       
|Commission expense and other charges                    |  |     |  |  |         |        | (284    | )     |         |        | (247    | )     |        |  | (283    | ) |        |  | (322    | )
|                                                       
|                                                       
|                                                       
|                                                       
|Provision for losses on off balance sheet credit risks  |  |     |  |  |         |        | 0       |       |         |        | (1,600  | )     |        |  | (4,800  | ) |        |  | (4,800  | )
|                                                       
|                                                       
|                                                       
|                                                       
|Other income                                            |  |     |  |  |         |        | 2       |       |         |        | 35      |       |        |  | 8       |   |        |  | 44      |  
|                                                       
|                                                       
|                                                       
|                                                       
|Operating expenses                                      |  |     |  |  |         |        | (6,123  | )     |         |        | (5,058  | )     |        |  | (5,131  | ) |        |  | (4,868  | )
|                                                       
|Net income before income tax                            |  |     |  |  |         |        | 22,861  |       |         |        | 24,831  |       |        |  | 23,295  |   |        |  | 26,133  |  
|                                                       
|                                                       
|                                                       
|                                                       
|Income tax                                              |  |     |  |  |         |        | 0       |       |         |        | (59     | )     |        |  | (3      | ) |        |  | (3      | )
|                                                       
|                                                       
|                                                       
|                                                       
|Net income                                              |  | US$ |  |  | 22,861  |        |         |       | 24,772  |        |         |       | 23,292 |  |         |   | 26,130 | 
|                                                       
|Net income available to common stockholders             |  | US$ |  |  | 22,538  |        |         |       | 24,433  |        |         |       | 22,951 |  |         |   | 25,789 | 
|                                                       
|Earnings per share (after dividends on preferred stock) |  | US$ |  |  | 1.16    |        |         |       | 1.23    |        |         |       | 1.15   |  |         |   | 1.29   | 
|                                                       
|                                                       
|                                                       
|                                                       
|Diluted earnings per share                              |  | US$ |  |  | 1.16    |        |         |       | 1.22    |        |         |       | 1.14   |  |         |   | 1.28   | 
|                                                       
|                                                       
|                                                       
|                                                       
|Average number of common shares outstanding             |  |     |  |  |         |        | 19,429  |       |         |        | 19,874  |       |        |  | 19,916  |   |        |  | 19,915  |  
|                                                       

---

F-45