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BTG Pactual's Q2 profit jumps 13.6%; Argentina holds key rate

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BTG Pactual's Q2 profit jumps 13.6%; Argentina holds key rate

* BTG Pactual Group booked adjusted net income of 685 million Brazilian reais for the second quarter, up 13.6% from 603 million reais in the year-ago period. The result came as total revenues jumped to about 1.24 billion reais from 851 million reais a year earlier.

* Argentina's central bank maintained the monetary policy rate at 40%, and has now tied the benchmark rate to the seven-day Leliq notes, exclusively for the country's banks, instead of Lebacs. The regulator also created a new, four-person monetary policy committee to determine the central bank's reference rate, consisting of the central bank's president, vice president and one board-selected director, along with the deputy head of economic investigations.

MEXICO AND CENTRAL AMERICA

* Cofemer, Mexico's federal commission that is studying the country's draft financial technology law, has proposed higher capital requirements for fintech firms compared to initial versions of the draft, El Economista reported. Cofemer wants capital requirements for fintechs to be based on the type and number of operations they are allowed to perform.

* Moody's said development banks in Mexico have strong asset quality and capital levels, and are in a good position to boost loan disbursements once President-elect Andrés Manuel López Obrador takes office in December, El Economista reported.

* Costa Rican Finance Minister Rocio Aguilar acknowledged in a legislative hearing that his ministry has been paying off sovereign debt since June without prior authorization from Congress, El Financiero reported.

* Former El Salvador President Antonio Saca, who led the country from 2004 to 2009, pleaded guilty to embezzlement and money laundering charges in exchange for a reduced prison sentence, Reuters reported.

CARIBBEAN

* S&P Global Ratings downgraded Barbados' long-term and short-term local currency sovereign issuer credit ratings to SD, or selective default, from CC and C, respectively. S&P said Barbados on Aug. 2 made an "automatic" principal rollover on its principal payments on short-term local currency treasury bills, which S&P considers as paramount to default, and that they "do not expect the government to make these payments in the near term."

* Republic Financial Holdings Ltd., based in Trinidad and Tobago, has entered talks to potentially acquire, through its subsidiary Republic Bank Trinidad and Tobago (Bardados) Ltd., a stake of at least 51% and up to 74.99% in Cayman National Corp. Ltd. The potential acquisition would be carried out through a tender offer to Cayman National shareholders, with Republic Financial eyeing an indicative price between US$6.00 and US$6.75 per Cayman National share.

* Greenlight Capital Re Ltd. on Aug. 7 issued $100.0 million in aggregate principal amount of its 4.00% convertible senior notes due 2023. The company said it used about $13.8 million of the net proceeds from the sale to finance a repurchase of 1 million of its class A ordinary shares, with the remainder to be used to make contributions to the capital and surplus of its reinsurance unit, and for general corporate purposes.

BRAZIL

* Banco Daycoval SA booked net income of 126.3 million reais for the second quarter, only up 0.6% from 125.6 million reais earned a year ago. Daycoval's gross profit from financial intermediation was down 12.4% to 363.2 million reais from 414.3 million reais in the prior-year period, due to a 58.1% rise in financial intermediation expenses. Also, loan-loss provisions soared 40.6% annually to around 253.1 million reais in the second quarter.

* Brazil's central bank did not provide an outlook on monetary policy in the minutes of its most recent interest rate meeting, at which it left the benchmark Selic rate at a record low of 6.50%, Reuters reported. "Increased uncertainty around the current conjuncture creates a need for higher flexibility for monetary policy, which warrants refraining from providing indications over the next steps for monetary policy," the bank said.

* Brazilian banking association Fenaban has proposed a wage hike of 3.90% for bank employees in the country, in line with domestic inflation, Valor Econômico reported. However, Brazil's main banking unions have indicated that they will reject the proposal at an upcoming meeting, as they reportedly seek a 5% salary increase.

* Banco Pan SA will start distributing its payroll-deductible credit cards through Caixa Econômica Federal's branch network in September, Valor Econômico reported. Caixa is a shareholder of Banco Pan.

ANDEAN

* Company delinquencies in Peru rose to 5.1% at the end of the first half of 2018, El Comercio reported, citing data from financial regulator SBS. While some business sectors in Peru are showing signs of economic recovery, with an increase in loans granted, SMEs and other companies are still feeling the effects of natural disasters in 2017 and the decline in the construction sector following various corruption scandals, including those involving Brazil's Odebrecht.

* Ivan Duque was sworn into office as Colombia's president on Aug. 7, saying he would introduce measures to boost the country's sluggish economy, Reuters reported. He replaces Juan Manuel Santos.

SOUTHERN CONE

* Argentina's Merval index on the Buenos Aires stock exchange sank 3.85% on Aug. 7 as of 5:30 pm local time, with Banco Macro SA's shares falling 7.09% in trading in Buenos Aires and 7.94% in New York, following news of the so-called notebook scandal in the country with alleged ties between corporations and politicians during the former Kirchner administration, El Cronista reported. Former Argentine Vice President Amado Boudou was also sentenced to 5 years and 10 months in prison for his involvement with illicit transactions with printing company Ciccone Calcográfica.

* Baruc Saez, the head of Itaú Unibanco Holding SA's international fixed-income unit, said Argentine firms will issue at least $5 billion of overseas bonds by March 2019, Bloomberg News reported. "Argentine issuers will start selling international debt in September," he said. "The market will be able to easily digest $5 billion of bonds."

* Fitch Ratings affirmed Chile's long-term foreign currency issuer default rating at A, with a stable outlook. The rating is supported by a credible policy framework centered on an inflation-targeting regime, flexible exchange rate and relatively strong sovereign balance sheet, the rating agency said.

* Banco de Chile invested close to $16 million to improve cybersecurity during 2017, Diario Financiero reported, citing bank executives who spoke to analysts in a conference call. The bank is creating a new division to address cybersecurity concerns following a string of recent data breaches.

* Chile's TDLC competition tribunal rejected a bid by the country's blockchain association to join cryptocurrency trader Orionx's lawsuit against Banco del Estado de Chile over the closure of Orionx's account at the bank, Diario Financiero reported. The association wanted to become part of the lawsuit for "the purpose of protecting and promoting the rights of companies that work on the basis of blockchain technology."

* Banco Macro SA said it repurchased about 73.6 million Argentine pesos worth of class B bonds that mature in 2022.

IN OTHER PARTS OF THE WORLD

* Asia-Pacific: CBA full-year profit drops; former Malaysian PM to face money laundering charges

* Middle East & Africa: Nedbank H1 headline earnings up YOY; Nigerian central banker hints at rate hike

* Europe: UniCredit de-friends Facebook; Munich Re, ABN Amro report Q2 earnings

This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings, a separately managed division of S&P Global. Descriptions in this news article were not prepared by S&P Global Ratings.

The Daily Dose has an editorial deadline of 8:00 a.m. São Paulo time, and scans news sources published in English, Portuguese and Spanish. Some external links may require a subscription. Links are current as of publication time, and we are not responsible if those links are unavailable later.