* Brazil's Banco BMG SA said it is considering an initial public offering of preferred shares and is looking to hire banks to coordinate the potential offer, according to a filing. The offer would be subject to market conditions.
* Scotiabank Chile's consolidated net income for the first half of 2019 reached 160.34 billion Chilean pesos, up 110.6% from 76.14 billion pesos in the year-ago period. The bank's net interest income rose to 433.37 billion pesos from 248.22 billion pesos, while net fee income almost doubled to 102.46 billion pesos.
MEXICO AND CENTRAL AMERICA
* Mexican central bank deputy governor Jonathan Heath said inflation of about 3.0% – the central bank's target – creates the conditions for monetary policy easing, El Economista reported. He said he expected the INPC inflation index for the second half of August to come in at between 3.1% and 3.2%, but cautioned that the behavior of the underlying inflation index, and its causes, would need to be evaluated.
CARIBBEAN
* Bank of Jamaica decided to lower its policy interest rate by 25 basis points to 0.50%, saying that in the absence of a policy response, inflation would likely fall below its 4.0% to 6.0% target range at various points over the next eight quarters. The rate cut aims to "stimulate a faster expansion in private sector credit, which should lead to higher economic activity," the central bank said.
BRAZIL
* Brazilian central bank chief Roberto Campos Neto said the economy was either stagnant or grew only slightly in the second quarter, adding that low inflation provides the regulator with space for additional stimulus, Reuters reported. Meanwhile, the country's economy probably grew 0.2% in the second quarter, according to the median estimate of 28 economists polled by the newswire.
* Banco BTG Pactual SA's shares gained up to 11% on Aug. 27, partly reversing a 31% decline during the previous two trading days after police raided the bank's headquarters as part of a corruption investigation, Bloomberg News reported. Analysts at Banco Santander SA reiterated their buy rating on BTG and maintained their price target for the Brazilian company at 88 reais. "We understand the negative pressure on the stock," the analysts said, but added that BTG is "currently in a much more solid, liquid and solvent situation than it was in 2015."
* Brazil's central bank said it intends to sell as much as $1.5 billion in the spot market today with repurchase commitments, Reuters reported. The intervention would be on top of a planned $550 million spot market sale related to regular auctions of swap contracts.
* Borrowing costs in Brazil will take time to fall despite the decline in the country's Selic rate to 6.0% and an improvement in the credit market, Diário Comércio Indústria & Serviços reported. Analysts said any declines would happen first in loans with a guarantee that poses a lower risk to banks. The average annual interest rate of the Brazilian financial system stood at 25.2% in June, up 0.6 percentage points year over year.
* Brazilian central bank chief Roberto Campos Neto said the integration of the Financial Intelligence Unit with the monetary authority does not mean the anti-money laundering unit will become a department of the central bank, O Estado de S. Paulo reported. He said the reform would guarantee autonomy and allow the unit to improve its operations.
* Banco Bradesco SA and Itaú Unibanco Holding SA appear to have the biggest exposure among private Brazilian banks in Odebrecht SA's new list of creditors presented as part of the construction conglomerate's judicial recovery plan, O Estado de S. Paulo reported. The documents show Bradesco with 8.38 billion reais in unsecured credits and Itaú with 7.71 billion reais.
* Brazil's central bank is creating a new liquidity assistance system for financial institutions, reducing their need for such large reserve requirements, Reuters reported, citing central bank chief Roberto Campos Neto. He said the mechanism should be ready in about 18 months, adding that the central bank was simultaneously lowering reserve requirements to boost the lending capacity of banks.
* Banco do Estado de Sergipe SA said the state government of Sergipe, which controls the bank, is interested in selling part of its stake in the lender in a public share offering, according to a filing. It said the offer could be for 45% of the bank's common shares and 40% of preferred shares, maintaining the state government's control of the institution.
* Swiss investment bank Julius Bär Gruppe AG will unify its Brazilian wealth management operations – GPS Investimentos and the São Paulo-based Reliance Group under the Julius Baer Family Office brand, Valor Econômico reported.
ANDEAN
* Scotiabank Perú SAA posted second-quarter net income of 353.7 million Peruvian soles, up 17.7% from 300.4 million soles in the year-ago period. Total interest income came to 1.02 billion soles, rising from 898.1 million soles a year earlier, while income from financial services increased to 220.9 million soles from 198.4 million soles.
* Corporación Financiera Colombiana SA raised 500.00 billion Colombian pesos from the issuance of series A bonds carrying maturities of between three and 20 years. Demand for the notes reached about 823.87 billion pesos.
* Colombian senators gave preliminary approval for draft legislation that would allow borrowers with poor credit ratings a second chance to access a loan to start a new business, El Tiempo reported. Among the measures envisioned in the bill would be reducing the time people are listed on negative credit registries if they settle their overdue debts.
* Banco de las Microfinanzas - Bancamía SA CEO Miguel Ángel Charria told La República in an interview that the entity's credit portfolio is expected to outperform the sector and grow about 7% this year due to efforts to reach remote areas. He also said net profit should grow by 7% while saving by microentrepreneurs was growing by 20% annually.
SOUTHERN CONE
* Banco Santander Chile's shareholders approved the bank's purchase of a 51% stake in Santander Consumer Chile SA for about 62.14 billion Chilean pesos. Banco Santander Chile will acquire a 49% stake from Skberge SA and a 2% stake from Spain-based Banco Santander SA, subject to regulatory approvals.
* Argentina's central bank sold $302 million of reserves in the foreign exchange market on Aug. 27, Reuters reported, citing traders. The country's financing agreement with the International Monetary Fund limits daily reserves sales to $250 million, with the option of intervening further to "counteract episodes of excessive volatility."
IN OTHER PARTS OF THE WORLD
* Middle East & Africa: Global sukuk issuance set to rise; Bank Leumi names CEO; Hapoalim CFO to resign
* Europe: Deutsche Börse offices raided; RBS suffers another IT glitch; all eyes on Italy
* North America: 2 US banks to add Japan-focused staff; Wells Fargo fined; Nebraska CUs in deal
Helen Popper contributed to this article.
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.
