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Grupo Indalo looks to sell Providencia Compañía Argentina

Banking Essentials Newsletter - November Edition

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University Essentials | COVID-19 Economic Outlook in Banking: Rates and Long-Term Expectations: Q&A with the Experts

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Grupo Indalo looks to sell Providencia Compañía Argentina

* GrupoIndalo has started searching for buyersfor indebted insurance firm Providencia Compañía Argentina de Seguros SA around sixmonths after it bought the company, LaNacion reported, citing anonymous market sources.

MEXICO AND CENTRALAMERICA

* The CentralAmerican Bank for Economic Integration plans to open a regionaloffice in Panama tosupport its public and private sector investment projects in the country,Panama's Finance Ministry said on its website. The bank has so far managed itsoperations in Panama from its headquarters in Honduras.

* Fitch Ratings affirmed Guatemala's long-term foreign and localcurrency issuer default ratings at BB, with a stable outlook. Fitch noted thatGuatemala maintained GDP growth of 4.1% in 2015, as real wage gains, stronggrowth in worker remittances and low oil prices supported private consumption.

* Mexico's budget deficitfell 38% year over year in the first quarter to about 61.56 billion Mexicanpesos, Reuters reported, citing the finance ministry.

* Mexico's GDP grew 2.7% in the first quarter compared to ayear earlier, The Wall Street Journalreported,citing the country's National Statistics Institute. According to the medianestimate of 36 economists recently polled by the central bank, Mexico's economyis expected to expand2.4% in 2016, the Journal reportedseparately.

* Mexico's Finance Ministry said it will cut down on debt issuancein the second quarter by 17.4 billion Mexican pesos, Reuters reported.

* Standard & Poor's Ratings Services raised its nationalscale long-term counterparty credit and financial strength ratings onQuálitas Compañía de Seguros SAde CV to mxAA+ from mxAA. S&P also raised its global scalelong-term counterparty credit rating on Quálitas Controladora SAB de CV to BB+ from BB.

* Mexican commercial banks increased lendingto the private sector by 11.1% in March compared to the same month a year ago, El Economista reported, citing centralbank data.

* Mexican banking and securities commission CNBV has designatedseven local banks as being systemically important, saying that these lendersshould be required to hold additional capital, El Economista reported. The banks are , ,Grupo Financiero Santander MexicoSAB de CV, GrupoFinanciero Banorte SAB de CV, Grupo Financiero HSBC SA de CV, andGrupo Financiero ScotiabankInverlat SA de CV.

* Grupo Financiero Banamex SA de CV posted first-quarter netincome of about 5.77 billion Mexican pesos, up 19% compared to the year-agoperiod, El Financiero reported.

BRAZIL

* Standard & Poor's Ratings Services ' long-term issuer credit rating to BB from BB+ and itsshort-term issuer credit rating to B from A-3. The downgrade follows theresults of a stress test that contemplated a Brazil default in foreign andlocal currency.

* Fitch Ratings changed its outlook on 's BBB+(bra) nationalinsurer financial strength rating to negative from stable. The revision followsBanco BTG PactualSA's recent agreement to sell its entire stake in the insurer toFrench firm CNP AssurancesSA.

* BancoSantander (Brasil) SA and unit Aymoré Crédito entered into an with Hyundai Motor BrasilMontadora de Automóveis Ltda. and Hyundai Capital Services Inc. to create a joint venture.Under the agreement, the companies will establish Banco Hyundai Capital BrasilSA and an insurance brokerage firm to provide auto finance and insurancebrokerage services to consumers and Hyundai dealerships in Brazil.

* The unemployment rate in Brazil roseto 10.9% in the first quarter from 10.2% in the prior period, Bloomberg Newsreported. The country's GDP is expected to shrink 3.88% in 2016, according to acentral bank survey.

* Brazil posted a primary budget deficit of about 10.64billion Brazilian reais in March, Reuters reported,citing data from Banco Central doBrasil.

* Brazilian President Dilma Rousseff could support calls forfresh presidential electionssince she believes she has a slim chance of surviving an upcoming Senateimpeachment vote, Bloomberg News reported, citing "three governmentofficials who were briefed on the discussions." According to a documentseen by Reuters, Vice President Michel Temer would look to reinforceanti-graft institutions and implement stricter oversight of state-run firms ifhe assumed the country's leadership.

* The Brazilian real declined1.9% to about 3.50 per U.S. dollar on May 2 after Banco Central do Brasilauctioned 40,000 reverse swaps in a move that is equivalent to purchasing $2billion in the futures market, Bloomberg News reported.

* Brazilian state-run banks , and are facing rising borrowingcosts in the bond market compared to private lenders, Bloomberg Newsreported.

* Brazil's Finance Ministry said it will increasethe so-called IOF financial tax, a levy on the purchase of foreign currenciesin cash, to 1.1% from 0.38%, Reuters reported. The ministry also raised the IOFtax on buyback operations made among financial institutions and their units to1% per day from zero previously.

* CieloSA posted first-quarter netincome of about 1.04 billion Brazilian reais, 15.5% higher compared to thefourth quarter of 2015, Reuters reported.

* If Brazil's Supreme Court agrees to changethe interest rate calculation on the debt that states owe to the federalgovernment, the benefit to the states would depend on their current respectivebudgetary situations, according to Fitch Ratings. The proposed cut would savethe states about 400 billion Brazilian reais over the entire term of the loans,which amounts to almost 90% of their outstanding debt.

* An increasing number of Brazilian brokerage firms areeither looking to mergeor implement new business models amid the country's deepening recession, Valor Econômico reported.

* Brazilian investment fund Faros Investimentos has agreedto takeover the clients of AX Capital in a deal that will boost its assets under managementby 150 million Brazilian reais, ValorEconômico reported.

* Banco PanSA reported a net loss of 96.1million Brazilian reais for the first quarter, 31% higher than the 73.5 millionreais net loss posted in the year-ago period.

* ItaúUnibanco Holding SA posted recurring netincome of about 5.18 billion Brazilian reais in the first quarter, Reutersreported.

* Banco Santander (Brasil) SA said its board Alexandre SilvaD´Ambrosio as executive vice president.

ANDEAN

* DBRS confirmed Colombia's long-term foreign currency issuerrating at BBB and long-term local currency issuer rating at BBB(high).Colombia's ratings are supported by its sound macroeconomic management andsolid medium-term growth prospects.

* Colombia's central bank, , raised itsbenchmark interestrate by 50 basis points to 7.0% as part of ongoing efforts to curbinflation. The move represents the eighth consecutive monthly increase afterthe central bank raised the rate by 25 basis points in March.

* Banco deBogotá SA is planning for a benchmark-size subordinated issuance, Reuters reported,citing "a source with knowledge of the situation." The prospectiveissue will be denominated in U.S. dollars and will be qualified for a Tier 2tranche under Colombian regulations.

* BancoCentral de Reserva del Perú President Julio Velarde said a recentcourt ruling that applies a merit-based labor regime at the central bank is"an outrage" and weakensthe bank's independence, Reuters reported.

* Fitch Ratings said it expects attractive growthrates for almost all business lines in Peru's insurance industry throughout2016 despite the tighter economic growth expected for the country.

SOUTHERN CONE

* The Chilean banking sector's net profit 2.57% year over year in thefirst quarter to 475.78 billion Chilean pesos, local banking regulator SBIFsaid. Higher spending on loan provisions was the main reason for the decline,as the ratio of provisions to total loans rose to 2.51% in March from 2.39% ayear ago.

* Chile's Liberty Compania de Seguros Generales SA said it electeda new board that includes two newdirectors, Lara Sojka and Jeffrey Feintech.

* BancoBICE said its board accepted the resignation of director Eliodoro Matte Capdevila, andnamed Rodrigo Donoso Munita as his replacement.

* Gabriel Martino, who was forced out of his position aspresident of HSBC Bank ArgentinaSA by Argentina's central bank in September 2015, is back at thebank's helm and has been elected chairman of the board, the bank said. Gonzalo FernándezCovaro, who served as president during Martino's absence, has now been electedas vice president. Meanwhile, Antonio Losada resigned as a director of the bankdue strictly to personal reasons.

* Moody's assigneda Baa2 global scale local currency and Aaa.uy national scale insurancefinancial strength ratings to Banco de Seguros del Estado, with a stable outlook.

* Moody's assigneda Ba3 global scale local currency and A1.uy national scale insurance financialstrength ratings to CompaniaCooperativa de Seguros Surco, with a stable outlook.

* Moody's assignedBa3/Not Prime long- and short-term global scale deposit ratings, as well as aA2.uy national scale deposit rating, to Banco Patagonia (Uruguay) SAIFE, with a negative outlook.

* Moody's assignedBaa2/Prime-2 long- and short-term global scale deposit ratings, as well as anAaa.uy national scale deposit rating, to Hapoalim (Latin America) SA, with a stable outlook.

* Paraguay's Agencia Financiera de Desarrollo (AFD) plans to reduce interestrates on loans to the agricultural and industrial sectors in May, La Nacion reported.

PAN LATIN AMERICA

* Credit conditions for Latin American corporates willremain pressureduntil 2017 amid headwinds shored up by stunted global economic growth, Moody'ssaid. Stronger economic performance will cushion companies in Mexico, Chile andPeru, but those in Brazil will suffer from the country's poor economy andpolitical woes. Argentina, meanwhile, is regaining business and investorconfidence due to prospects of a more market-friendly environment even thoughcredit conditions are still difficult.

IN OTHER PARTS OF THEWORLD

* According to South Korea's Financial SupervisoryService, state-owned banks' nonperforming loans increasedby 5.7 trillion won in 2015 year on year, as the total NPL balance totaled 29.9trillion won as of December 31, 2015, the Hankyorehreported.

* Australian entrepreneur Craig Wright said that he inventedcontroversial digital currency bitcoin and gave technical proof, Reutersreported. The claim has been met with some skepticism.

* The European Commission requestedBelgium, Latvia, the Netherlands and Slovakia to fully implement the newCapital Requirements Directive or CRD IV, which sets out rules on riskmanagement and capital buffers, among others. The EC also asked Belgium andSlovenia to fully implement the Bank Recovery and Resolution Directive, whichprovide for a "bail-in" mechanism where shareholders and creditors ofbanks on the verge of insolvency pay their share of the costs. The commissiongave these countries a deadline of two months, or they may be referred to the EUCourt of Justice.

* Australia& New Zealand Banking Group Ltd.'s statutory profit decreased22% year over year to A$2.7 billion for the six months ended March 31, whilecash profit stood at A$2.8 billion, down 24% from the prior-year period. Thebank declared a dividend of 80 Australian cents per share.

S&P Ratings andGlobal Market Intelligence are owned by S&P Global Inc.

Matthew Crazecontributed to this article.

The Daily Dose has aneditorial deadline of 8:00 a.m. São Paulo time, and scans news sourcespublished in English, Portuguese and Spanish. Some external links may require asubscription.