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Fitch revises outlook on 6 Argentine firms; country's banks bear brunt of crisis


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Fitch revises outlook on 6 Argentine firms; country's banks bear brunt of crisis

* Fitch Ratings revised the outlook on the long-term issuer default ratings of Banco Santander Río SA, BBVA Banco Francés SA, Banco Macro SA, Banco Supervielle SA, Tarjeta Naranja SA and Banco de la Ciudad de Buenos Aires to stable from positive, following the same action on Argentina's sovereign rating.

* The swiftness and severity of recent hikes to the Argentine central bank's benchmark rate— 1,275 basis points over the course of a week — will temporarily squeeze bank margins as they work through the mismatch of assets and liabilities, will also likely dampen loan growth, and could spur an uptick in delinquencies. Juan Manuel Vazquez, head of equity and credit research at Buenos Aires-based Puente, forecast that lending activity will decrease, followed by net interest margins compressing with the growth of funding costs. He added that earlier guidance for 20%-plus loan growth for 2018 is now "very difficult to reach."


* Lorenza Martinez, the head of the Mexican central bank's payment system, disclosed that multiple "unauthorized transfers" of an unknown amount occurred in at least five financial institutions in Mexico recently, Reuters reported. The transfers reportedly took place within a third-party provider "that connects the institutions to the payment system." The monetary authority did not explicitly label the event as a cyber attack.

* Chief trade negotiators from Mexico, Canada and the U.S. did not reach an agreement for the basis of an updated North American Free Trade Agreement during the previous week, Reuters reported.

* Banco Centroamericano de Integración Económica signed a loan agreement with Austria's Oesterreichische Entwicklungsbank AG for up to $30 million, with proceeds to finance projects related to energy efficiency, renewable energy, and efforts against climate change and pollution.

* Colonel Manuel Guevara, a spokesman for the Nicaraguan military, said the armed forces have no reason to crack down on anti-government protests in the country, Agence France-Presse reported. The death toll from the protests against President Daniel Ortega is now at least 51, the newswire added.


* Net debt for B3 SA – Brasil, Bolsa, Balcão as a ratio to EBITDA will fall to 1.1x by the middle of 2019, compared to 2x over the past 12 months, Reuters reported, citing Rogerio Santana, the head of investor relations for the bourse.

* A bill in Brazil is proposing to shorten the time it takes to complete bankruptcy process to three years from 10 as part of the government's efforts to improve the country's business environment, Valor Econômico reported. The bill also aims to facilitate the sale of assets and give more power to creditors of a company that files for bankruptcy.

* Amid low inflation, the financial market expects Brazil's central bank to announce the last interest rate cut of its current monetary policy cycle on May 16, Valor Econômico reported. Some economists cited by the publication expect a rate cut of 0.25 percentage point.

* Banestes SA - Banco do Estado do Espírito Santo has lowered interest rates on real estate loans to 8.80% per year from 9.30%, a level that was set at the start of April, Diário Comércio Indústria e Serviços reported.

* Large hydroelectric power plants in Brazil have asked the government to revise their loan contracts with state-run Banco Nacional de Desenvolvimento Econômico e Social as they look to mitigate the impact of higher costs due to rising interest rates, Folha de S.Paulo reported. The issue is of concern for the government because the higher costs could be passed on to consumers.


* Fitch Ratings revised the outlook of Banco Interamericano de Finanzas SA's BBB- long-term foreign and local currency issuer default ratings to negative from stable. The negative outlook reflects concerns on the continued deterioration of the bank's performance and asset quality, both of which are further pressuring its already tight capitalization levels and relatively limited loss absorbing capacity.

* Mortgage and credit card loans showed high growth rates in Peru's financial sector during the first quarter, Gestión reported, citing Michela Casassa, director of finance at Intercorp Financial Services Inc. Loans in the sector grew 6.6% annually in the period, with retail loans rising 7.5% and commercial credit growing 6.2%, the executive said.

* Credicorp Capital Peru SAA will launch a new stock fund in Peru by the end of May, aiming for it to be the largest equity fund in the country, SEMANAeconómica reported. The fund, called Renta Variable Latinoamérica, will be listed in Luxembourg and will offer exposure to Latin American equities.


* Argentina's central bank intervened in the local spot market on May 11, selling about $1 billion, Reuters reported. The peso ended the day down 2.74%, to 23.35 pesos to a U.S. dollar. Over-the-counter bonds were also down an average of 0.8%.

* The board of Argentine card issuer Tarjeta Naranja SA approved the issuance of up to $350.0 million in negotiable obligations, under a global program for the issuance of up to $1.00 billion or its equivalent in any other currency. The company has not yet disclosed the date of issuance.


* Colombian President Juan Manuel Santos said that some form of regime change may occur "very soon" in Venezuela after their May 20 presidential elections, Reuters reported. Meanwhile, Chilean Foreign Minister Roberto Ampuero said the Lima Group, composed of mostly Latin American countries, should put more pressure on Venezuelan President Nicolas Maduro. Ampuero added Chile has not named a new ambassador in Caracas to send a "clear" signal.


* Europe: Barclays CEO fined; ABN AMRO posts Q1 ; Deutsche Bank names CIB co-presidents

* Middle East & Africa: S&P upgrades Egypt; Fidelity Bank Ghana seeks M&A deals

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