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Mercosur to 'indefinitely' suspend Venezuela; Sul América income drops

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Mercosur to 'indefinitely' suspend Venezuela; Sul América income drops

* South American trade bloc Mercosur will meet Aug. 5 to suspend Venezuela indefinitely and disallow it from rejoining until it restores democracy, Reuters reported, citing a Brazilian government source "with knowledge of the negotiations." Foreign ministers of Argentina, Paraguay, Uruguay and Brazil will meet in São Paulo, the official said.

* Sul América SA booked a net income of 81.5 million reais in the second quarter, down from 127.1 million reais in the year-ago period. Net income per unit came to 21 centavos, declining 44.9% from 38 centavos a year ago.

MEXICO AND CENTRAL AMERICA

* The intergovernmental organization Financial Action Task Force, or FATF, has recognized and approved Mexico's fight against money laundering, Sandro García-Rojas Castillo, director at banking regulator CNBV, told reporters in a conference on Latin American financial crimes, according to an El Economista report.

* Fitch Ratings raised the outlook on Mexico's long-term foreign and local currency issuer default ratings to stable from negative, while affirming its BBB+ rating, citing reduced downside risks to the country's growth and expected stabilization of its public debt burden. The rating agency said Mexico's economy would grow 2% in 2017 and post an average 2.4% growth from 2018 to 2019.

* Mexico's seasonally adjusted consumer confidence index edged up to 86.6 in July from 85.1 in June, Reuters reported, citing the national statistics agency.

* The Bank of Nova Scotia (Costa Rica) SA has appointed Juan Carlos Vega Vega as general manager and Juan Bautista Monge Corrales as deputy general manager.

* Guatemalan lawmakers clashed during a fiery debate in the lower house over proposals to reform the country's banking law, with some saying the bill will benefit the banking industry at the expense of taxpayers, Prensa Libre reported. Among other reforms, the draft legislation outlines the mechanism for rescuing troubled lenders using public funds.

* Mexican banks accumulated a net profit of 67.7 billion Mexican pesos in the first half of 2017, up 25% year-on-year, El Economista reported, citing the CNBV banking and securities regulator. Higher interest income and commissions have helped the sector's profits.

CARIBBEAN

* Banco Central de la República Dominicana's order for banks to allocate 20.4 billion Dominican pesos of their legal reserves to lending to specific sectors is a credit negative for the banks, noted Moody's. The rating agency said the move will require banks "to increase exposure to riskier lending to consumers, agribusiness, manufacturing, lower-end housing and small and midsize enterprises (SMEs) at below-market rates, thereby reducing profitability and raising asset risks."

* The Dominican Republic's banking regulator hosted a two-day meeting with bank executives and other financial professionals to discuss the impact of a new law to tackle money laundering, Listin Diario reported. SIB President Luis Armando Asunción said the meeting was aimed at ensuring the country complies with new international standards on combating money laundering and terrorism financing.

BRAZIL

* IRB-Brasil Resseguros SA plans to move fiscal council member Antonio Rugero Guibo to its board as an alternate director. In conjunction with the shift, the company has tapped Nara de Deus Vieira to replace Guibo on the fiscal council.

* Banco Central do Brasil's President Ilan Goldfajn said the country's economy is still weak, but is expected to grow 2% in 2018, Reuters reported, citing a radio interview.

ANDEAN

* Ecuadorian Vice President Jorge Glas was stripped of his powers for questioning the credibility of the government's economic figures, Reuters reported. President Lenin Moreno dismissed his VP for not being a team player.

* Venezuela's state prosecutor has asked a court to halt the inauguration of the country's newly elected 545-member constitutional body, citing allegations of electoral fraud, Reuters reported.

* Financial institutions in Peru are granting more credit to borrowers who only have one credit card, El Comercio reported, citing research by credit bureau Sentinel. It found that the average debt of customers with one card rose 7.1% at the end of June to 4,820 Peruvian soles, while average debt for those with more than one card rose just 1.1% to 7,306 soles. Sentinel added that lenders were also paying attention to potential borrowers' social media activity, especially in cases of limited credit history, the newspaper reported separately.

SOUTHERN CONE

* Banco Central de la República Argentina sold $42.3 million in forex markets after the country's peso slipped 0.45% to 17.67 per dollar, Reuters reported.

* Mortgage credit in Argentina is rising, with 36% more loans granted in July compared with the previous month, Clarin reported, citing officials and central bank data. Of the 5.085 billion pesos in mortgages granted in July, 77% were inflation-indexed loans.

* Juan Pablo D'Antiochia, Latin America general manager at card payment administrator Worldpay Group plc, said the company plans to start operations in Argentina before the end of the year, La Nacion reported.

* Debit card payments in Uruguay jumped 75% in the first half of 2017, El Pais reported, citing a report from the Banco Central del Uruguay. The number of debit cards in circulation in Uruguay rose 12% in the same period year-on-year to reach 2.6 million.

* The number of complaints against Uruguayan financial entities is rising steadily, increasing 6.8% in 2016 from a year earlier, El País reported, citing Banco Central del Uruguay figures. Banks accounted for 68% of the total 249 complaints registered by the central bank.

* Banco del Estado de Chile has reached an agreement on the basis of collective bargaining with trade unions in line with the country's new labor law, and will take effect on Oct. 1, Pulso reported.

PAN LATIN AMERICA

* The Basel Committee on Banking Supervision is expected to defer its next meeting to early October, so it has more time to come up with universally acceptable global capital rules, "people familiar with the talks" told Reuters. Meanwhile, a director at Fitch Ratings also told the newswire in a separate report that leading Brazilian banks are well-equipped to meet Basel III capital rules, which will come into full force in the country in 2019.

* The Latin American and the Caribbean economy will rebound to a 1.1% average growth in 2017 after two years of contraction, according to United Nations' regional organization ECLAC. Among subregions, Central America and Mexico are seen growing 2.5% on average due to improved prospects in the U.S. Meanwhile, South America's GDP will expand 0.6% while that of the Caribbean will advance 1.2% after a 0.8% contraction in 2016.

IN OTHER PARTS OF THE WORLD

* Middle East & Africa: Standard Bank eyes new biz; Angola's Recredit to buy $2B of bad loans

Helen Popper contributed to this article.

The Daily Dose has an editorial deadline of 8 a.m. São Paulo time, and scans news sources published in English, Portuguese and Spanish. Some external links may require a subscription.