The primary advantages of banking in Panama is its strong asset protection laws and the lack of income tax on foreign derived income.  Panama is home to many multi-millionaires because it attracts savvy business people and investors who understand how powerful it can be to let your money grow in a tax free environment. 

Panama IBC Privacy -- Companies in Panama are typically setup in one of two ways:

1. Panama Bearer Share Corporation -- A Panama bearer share company is owned by the person or company that physically holds the shares.  There is no public record of ownership.  Ownership can be transferred without any record by simply handing the shares over to the new owner.  The Panama bearer share company (IBC) can own one or more bank accounts in Panama or in other offshore tax havens.
2. Panama Foundation owning a Panama Corporation --  Many people don't understand a foundation and its purpose.  The most common questions run along the lines of  "If I have a Panama foundation why do I need a Panama company?"  or "Why bother with a foundation when a bearer share company is so anonymous by nature?"  The answer to the first question in quite simple.  A foundation cannot engage in business activity.  So there are many limitations on what you can do with it.  It can, however, own a Panama corporation which can engage in any business activity.  The answer to the second question is more complex and less obvious.  Outside of Panama, some banks and other entities do not respect a bearer share corporation making it hard for a bearer share company to open a bank account.  Often the bank will ask for extra information on the directors of the company, defeating the privacy rationale for setting up such a secure company.  Also in asset protection situations, if a court learns the money being sought after is being held by a bearer share company, there is immediate suspicion that can arise.  If, however, the judge learns that the owner of the corporation is a foundation, he will think two things.  1)  This is a legitimate legal structure that will not be easily pierced.  2)  If the judge understands corporate structures, he will know that a foundation isn't owned by anyone!  It's a dead end.  This is a legal form of "Check-Mate" because the person being sued cannot recover the money even if he wanted to.  The judge cannot go on to say, "Do you own the foundation?" because a foundation cannot be "owned".  That makes a foundation a strong a key piece of a strong lawsuit protection structure.