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Banxico director quits after cyberattack; Bancolombia's Q1 income slides

* Lorenza Martínez has resigned as director of payment systems and corporate services at Banco de México, the country's central bank, Reforma reported. The resignation follows what the newspaper called "the most serious cyberattack in Mexico's financial history."

* Banxico will set up a cyber security division in the aftermath of a recent hack that affected multiple Mexican banks via their electronic payment systems, Reuters reported. Banxico head Alejandro Díaz de León reportedly said "all information we have points towards a cyberattack," Reforma reported, marking Banxico's first acknowledgement of the event.

* Bancolombia SA reported net income of about 521.76 billion Colombian pesos for the quarter that ended on March 31, down from 608.75 billion pesos in the year-ago period. Net interest income declined 4.15% from a year earlier to 2.513 trillion pesos for the first quarter. Net provisions also rose 12.98% from the prior-year period to reach 875.02 billion pesos in the first quarter.

MEXICO AND CENTRAL AMERICA

* Mexican banking and securities commission CNBV will sign a cybersecurity protocol in the coming days with the aim of responding more efficiently to events such as the recent cyberattacks targeting a number of Mexican financial institutions, El Economista reported, citing CNBV President Bernardo González Rosas. The protocol will include financial technology firms, he said.

* Grupo Financiero Banorte SAB de CV said it does not foresee any economic impact on its financial results from recent cyberattacks that targeted a number of Mexican banks, El Financiero reported. The bank said customer deposits are "completely safe."

* Mexican Economy Minister Ildefonso Guajardo, the country's chief trade negotiator, told the Televisa network that completing the necessary negotiations on a new North American Free Trade Agreement framework "isn't easy" and was unlikely to happen before a May 17 deadline, which U.S. House Speaker Paul Ryan said that the U.S. Congress needs to meet to be able to vote on a new treaty before the end of 2018.

* Fitch Ratings upgraded Banca Mifel SA Institución de Banca Múltiple Grupo Financiero Mifel's long-term foreign and local currency issuer default ratings to BB+ from BB, its viability rating to bb+ from bb, and its long-term national rating to A+(mex) from A(mex). The upgrades reflect the bank's sound financial performance and proven business model.

BRAZIL

* The number of Brazilians in default reached a record 61.2 million in April, up 0.4% from the previous month and up 1.9% from a year earlier, Diário Comércio Indústria e Serviços reported, citing credit research firm Serasa Experian.

* Economists surveyed by Reuters expect Brazil's central bank to lower its benchmark rate to 6.25% in a meeting later in the day, Reuters reported. Inflation in Brazil is currently below 4.5%, which is at the lower end of the regulator's target range.

* Fitch Ratings upgraded Banco Sofisa SA's long-term national rating to A+(bra) from A(bra), and revised the outlook to positive from stable.

* Brokerage firm Gradual has informed clients that it is ending stock exchange activities but will continue participating in investment fund and fixed income activities, Valor Econômico reported. The firm's owner is being investigated on suspicions of fraud.

* Federal police in Brazil have requested another 60 days to complete a bribery investigation involving President Michel Temer and some of his ministers, Valor Econômico reported. Temer and some of his political associates are suspected of having received bribes from construction form Odebrecht in return for favors.

ANDEAN

* Peru's Supreme Court has ruled against Scotiabank Perú SAA in an appeal case involving a tax payment of 482 million soles, SEMANAeconómica reported. The case involves unpaid tax payments from 1997 and 1998 when Banco Wiese, which Scotiabank acquired in 2005, traded gold.

* This month's upcoming presidential elections in Colombia has captured the attention of investors due to policies that could affect taxes, trade, growth and other critical issues for the business environment, such as reducing business tax or potential state intervention, according to Fitch Ratings. A senior director at the rating agency, Natalia O'Byrne, also cited low economic growth, higher debt, tax and pension reform, and the need to implement a peace agreement with former rebel group FARC as several challenges for a new Colombian administration.

SOUTHERN CONE

* Banco Macro SA posted total net income of 3.56 billion Argentine pesos for the first quarter of the year, soaring 76% from 2.02 billion pesos in the year-ago period. Net financial income grew 56% yearly to 7.30 billion pesos and net fee income was up 20% yearly to 1.94 billion pesos, helping offset a 25% increase in administrative expenses to 3.58 billion pesos.

* Index provider MSCI Inc. said its upcoming decision on whether to reclassify Argentina to emerging market status from frontier market status "will be more difficult" given the country's current market slump, Reuters reported. According to Sebastien Lieblich, MSCI's managing director, they will wrap up an investor consultation within a few weeks on the topic. MSCI will hold its annual classification review in June.

* Turbulence in Argentina's financial markets is unlikely to spread to other parts of Latin America, with the possible exception of Uruguay, El Cronista reported, citing Mauro Leos, Moody's head of sovereign risk for Latin America and the Caribbean. Meanwhile, Uruguay central bank head Mario Bergara said the upward trend of the U.S. currency in the local scene "does not bother us," adding that about 80% of the dollar's rise is due to global issues, with the remaining from Argentina.

* Premiums issued in Uruguay's insurance sector grew 2.5% year over year in the first quarter in real terms, El Pais reported. Mauricio Castellanos, the executive director of local insurance company association Audea, said this growth rate is much lower compared to what the sector has seen in recent quarters.

* Paraguay's Banco Regional SAECA cancelled a tender offer to repurchase up to all of its 8.125% senior notes due 2019, which was announced in April. All notes that have been validly tendered so far will be returned to their respective holders.

PAN LATIN AMERICA

* Fitch Ratings' covered corporates have seen a mildly positive trend of rating actions, and the rating agency's net leverage forecasts for Latin American corporates grew to 2.8x at the end of the first quarter of the year, from 2.6x a year earlier. Among Fitch-rated Latin American corporates, 5% have a positive outlook, 73% have a stable outlook, and 13% have a negative outlook.

* Guatemala opened its new embassy in Jerusalem, Israel earlier in the day, following the United States' decision to move its embassy, Reuters reported. Paraguay is also set to move its embassy to Jerusalem at the end of the month.

IN OTHER PARTS OF THE WORLD

* Asia-Pacific: Société Générale eyes China securities JV; Indian bank removes CEO amid scandal

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