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S&P downgrades Argentina; Banrisul Q3 profit up 31.6%

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S&P downgrades Argentina; Banrisul Q3 profit up 31.6%

* S&P Global Ratings lowered Argentina's long-term foreign and local currency ratings to B from B+, with a stable outlook, and removed the ratings from CreditWatch with negative implications. The downgrade reflects an erosion of the country's economic growth trajectory, inflation dynamics, and debt profile following setbacks in the government's implementation of its challenging economic adjustment program. Argentina's debt burden has also risen due to the rapid depreciation of the peso against the dollar.

* Banco do Estado do Rio Grande do Sul SA, or Banrisul, booked third-quarter net income of 290.2 million Brazilian reais, up 31.6% from 220.5 million reais in the prior-year period. The bank's net interest income jumped to about 1.43 billion reais from 1.27 billion reais a year earlier, while loan-loss allowance expenses fell to 247.6 million reais from 375.8 million reais.

MEXICO AND CENTRAL AMERICA

* Grupo Financiero Banorte SAB de CV's shares fell more than 8% on Nov. 12 as uncertainty over a legislative proposal to slash certain bank commissions gripped the market, Reuters reported. Over the weekend, Mexican media reported that legislators from President-elect Andres Manuel Lopez Obrador's party are still supporting the proposal despite the alarm it generated in the local banking sector.

* Mexican bank profits will take a beating if Mexico's incoming government implements its proposal to ban certain banking fees, Moody's said, noting that the measure would be a credit negative. A provision in the proposal to eliminate penalties for loan delinquencies of up to five days "would likely reduce the incentive for borrowers to make timely payments and lead to increased delinquencies," Moody's said.

BRAZIL

* Former Brazilian finance minister and current World Bank Group CFO Joaquim Levy has been confirmed as the new president of development bank Banco Nacional de Desenvolvimento Econômico e Social. Levy will replace Dyogo Oliveira, who was an appointee of outgoing Brazilian President Michel Temer. The appointment was confirmed, following earlier media reports, by an officer at the state-run bank and by the press team of incoming finance minister Paulo Guedes.

* Brazilian President-elect Jair Bolsonaro said a key pension reform bill will probably not pass through Congress in 2018, Reuters reported. Brazil's real currency fell against the U.S. dollar in futures markets following Bolsonaro's comments.

* Caixa Econômica Federal has suspended financing for the 1.5 category of the Minha Casa Minha Vida low-cost housing program due to a lack of resources but the state-run lender aims to resume funding next year, Diário Comércio Indústria & Serviços reported. In the 1.5 program, funding is granted for a 30-year term, with 90% of the resources coming from the FGTS workers' severance fund administered by Caixa.

ANDEAN

* Peruvian company Bits2u has launched the country's first cryptocurrency called PeruCoin, El Comercio reported. The digital coin will be promoted as a new payment means in a country that has one of the lowest cryptocurrency adoption rates in the region at 0.7%.

SOUTHERN CONE

* Fitch Ratings revised its outlook on the long-term issuer default ratings of several Argentine financial institutions to negative from stable following a similar action on Argentina's sovereign rating. The financial institutions include Banco Santander Río SA, BBVA Banco Francés SA, Banco Macro SA and Banco Supervielle SA, among others.

* Argentina's central bank has started issuing 30-day notes to the country's banks to compensate them for the cost of handling excessive quantities of banknotes, but banks say the measure will not resolve the problem and want the issuer to resume collection of the cash, El Cronista reported. The central bank transferred management of banknotes to individual banks in 2017, but their vaults are being overwhelmed. The 30-day paper pays a fifth of the monetary policy rate.

* Principal Compañía de Seguros de Vida Chile SA General Manager Diego Silva Robert will leave the company Dec. 14. The Chilean life insurer named María Eugenia Norambuena Bucher to serve as interim general manager.

* A Chilean court has ruled against Banco Ripley SA, saying the bank engaged in anti-union practices, La Tercera reported. The Second Labor Court of Santiago said the bank refused to apply a collective bargaining agreement reached with the union to some non-affiliated workers, instead offering the non-unionized members a better deal.

IN OTHER PARTS OF THE WORLD

* Asia-Pacific: Anbang transfers Chinese bank shares; South Korean banks halt NY wire services

* Middle East & Africa: Diamond Bank, Access Bank deny merger rumors; Skye Bank's management in hot seat

* Europe: Rabobank mulls sale of US ops; Carige to get €320M aid; Credit Suisse probed

Helen Popper contributed to this article.

This article was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global. 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.

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