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S&P places Argentina on CreditWatch negative; Chile revises cybersecurity rules

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S&P places Argentina on CreditWatch negative; Chile revises cybersecurity rules

* S&P Global Ratings placed Argentina's sovereign credit ratings on CreditWatch with negative implications, saying the recent pressure on the peso threatens the government's efforts to stabilize the economy. S&P also warned that the peso could face further downward pressure due to developments that weaken policy credibility and negatively affect inflation expectations, while noting that further raising Argentina's already-high interest rates could hurt the economy and the government's budget.

* Argentine Treasury Minister Nicolas Dujovne said the country would unveil new cost-cutting measures Sept. 3 that aim to reduce its fiscal deficit and stem the recent sharp devaluation of the peso, Reuters reported. The International Monetary Fund also said it will meet with Argentine officials Sept. 4 to discuss an early release of funds allocated under a $50 billion standby arrangement, after the country's central bank raised interest rates in an Aug. 30 emergency meeting. The central bank also auctioned $250 million in reserves Aug. 31 to help strengthen the peso. Following the auction and the statement of support from the IMF, the peso was up 6.08% to end Aug. 31 at 37 pesos to a dollar.

* Chile's bank supervisor, the SBIF, announced changes in its cybersecurity regulations wherein financial institutions will have to improve their incident reporting system. Changes include the creation of a specific platform together with the SBIF for the reporting of any cybersecurity incident within a 30-minute deadline, starting Oct. 1.

MEXICO AND CENTRAL AMERICA

* Fitch Ratings revised Banco Centroamericano de Integración Económica's outlook to positive from stable while affirming its ratings. The outlook revision considers the significant rise in its expected capital due to the consolidation of its concessional window with its ordinary capital and the expected approval of its eighth capital increase.

* The U.S. will work to sign a trade pact with Mexico, as ongoing talks with Canada have not yet yielded results, Reuters reported. "Anything other than a trilateral agreement won't win congressional approval and would lose business support," Thomas Donohue of the U.S. Chamber of Commerce reportedly said.

* Guatemala's Grupo Financiero G&T Continental launched its mobile banking app, called GTCAPP, as part of its digital transformation strategy through 2022, Prensa Libre reported.

BRAZIL

* Fitch Ratings believes the implementation of IFRS 9 accounting standards in 2020 will have a limited negative impact on capital and profits for Brazilian banks, and as such, will not have negative ratings implications. Specifically, Fitch does not expect Brazil's five largest banks to incur material capital reductions from loan loss provisions or reserve changes.

* Brazil's economy narrowly expanded by 0.2% in the second quarter compared with the linked quarter, according to national statistics agency IBGE. On an annual basis, the country's GDP expanded by 1.0% in the second quarter.

* Caixa Econômica Federal will strengthen its capital structure and increase its capacity to provide credit after the agreement with French insurer CNP Assurances SA. "We can increase credit, even if prudently, in the lines that require less capital allocation," the president of the Brazilian state-owned bank, Nelson Antonio de Souza, told Reuters.

* Numerous cryptocurrency companies had their accounts closed by Brazilian financial institutions to avoid possible sanctions from the Cade antitrust watchdog, O Estado de S. Paulo reported, citing the ABCB cryptocurrency industry group. The banks say it is impossible to identify the source of funds in cryptocurrency transactions, which may be linked with money laundering.

ANDEAN

* Ecuador will borrow $500 million in a repurchase agreement with Goldman Sachs Group Inc., paying 4.25% above the three-month Libor rate, the Financial Times reported. It will also tap $487 million from the Inter-American Development Bank at a 3.28% rate over 25 years. Another $105 million will be borrowed from Banco De Desarrollo De América Latina for 4.28%, payable over 12 years.

* The general manager of Peru's bank association Asbanc, Adrián Revilla Vergara, has left for personal reasons, Gestión reported. Miguel Vargas Ascenzo replaced Revilla.

SOUTHERN CONE

* Argentine President Mauricio Macri is considering reducing the number of government ministries to cope with a budget deficit, Reuters reported, citing local news outlets. The current ministries of science, culture, energy, agriculture and tourism will either be shut down or rolled into other ministries, La Nación and Clarín reported separately.

* Chilean broker Dupol SA Corredores de Bolsa aims to enter the Santiago stock exchange market, Diario Financiero reported. The board of the main Chilean stock market, the Bolsa de Comercio de Santiago Bolsa de Valores, has approved Dupol's application.

* After the merger between Banco Bilbao Vizcaya Argentaria Chile SA and Scotiabank Chile on Sept. 1, the chief economist of BBVA Research, Jorge Selaive, will now assume the same role at Scotiabank Chile, La Tercera reported.

IN OTHER PARTS OF THE WORLD

* Asia-Pacific: Fubon Life/Hyundai Life deal gets nod; Macquarie said to exit Yellow Brick Road

* Middle East & Africa: Old Mutual to enter South Africa's banking market; Oman Arab Bank names new CEO

* Europe: Funding Circle plans £300M IPO; Wonga victims may not get paid

Pablo Jiménez Arandia contributed to this article.

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.