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News through July 8


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News through July 8

S&P Global Market Intelligence presents theweek's latest news and trends in Latin American banking.

Deal buzz

* Chilean bankingregulator SBIF could give its approvalin the coming weeks for Mexican department store operator El Puerto de LiverpoolSAB de CV to acquire over 10% of BancoRipley's shares. The bank's owner, department store operator RipleyCorp. SA, earlier signed an agreement with Liverpool, which will launch a publicoffering for all of the company's shares.

* its acquisition of andHSBC Serviços e Participações Ltda. Bradesco acquired HSBC Holdings Plc's operationsin Brazil for 16.0 billion Brazilian reais, which is subject to post-closing adjustmentsbased on HSBC Brazil's IFRS financial statements as of July 1.

* Followingthe completion of the HSBC acquisitions, Bradesco will have an of more than 20% in its managementteam.

* Chairwoman AnaBotín said the bank is looking at the possibilityof buying Citigroup Inc.'soperations in Brazil, but it will only happen if it makes strategic and financialsense. "We cannot comment on specific issues, but I'll affirm that we havethe obligation to analyze every opportunity," Botín was quoted as saying.

* is expected to in the coming days the saleof its Mexican banking license and brokerage unit, Deutsche Securities SA de CVCasa de Bolsa, to Mexico's InvestaBank SA Institución de Banca Múltiple, according to a report. DeutscheBank, which operates in Mexico through DeutscheBank México SA Institución de Banca Múltiple, said last year that itplans to close operations in 10 countries, including Mexico.

* said that it acquiredan additional 19% stake in RepublicBank (Grenada) Ltd., increasing its total holdings in the bank to 70%.

From the legal desk

* Brazil's federalpolice have arrested JoãoCarlos Figueiredo Neto, an advisor from tax appeals board CARF, after filed acomplaint saying that they had received a bribery offer in exchange for a favorablejudgment in tax proceedings.

* Brazil's ongoing"Lava Jato" inquiry has discoveredthat Panama-based FPB Bank Inc.was operating in the country without permission from the Banco Central do Brasil. The investigation found that thebank was allegedly offering unauthorized financial services to 44 offshore companiesregistered by Mossack Fonseca, the law firm involved in the Panama Papers data leak.

* is denying accusationsof fraud in its payroll incentive program, after a video surfaced on social mediaalleging that the institution is involved in corrupt practices.


* Itaú Unibancoplans to keep its Hipercardbrand in operation due to customer loyalty despite its plans to create a new creditcard brand in a joint venture with MasterCard. The Hipercard brand will operatesimultaneously with the new card venture, the bank's director for cards segmentMarcos Magalhães said.

* Chile's bankingregulator SBIF is currently considering an applicationby Bank of China open a branch in the country. The bank's Mexican unit will focus on meeting thefinancial need of Chinese firms in Mexico and their suppliers, as well as Mexicanfirms doing business in China.

Capital moves

* The launcheda 12-year bond offeringin the Swiss market worth 145 million Swiss francs.

* launched an offer for 10-year subordinated bondsworth up to $300 million on the domestic and international markets.

* 's shareholdersapproved the groupingof 100 common shares to 1 share. In total, 29,645,967 book-entry common shares withoutnominal value will be regrouped.

* closed a three-year, $73.5 million senior secured syndicated for UNIFIN Financiera SAB de CV SOFOM ENR that is comprised ofa U.S. dollar tranche and a Mexican peso tranche.

* issued subordinatedbonds on the Bolivianstock exchange worth 32.5 million Bolivian bolivianos.

* is issuing 36-month negotiable bondsworth $18.25 million.

* 's shareholders have approved the issuance of subordinated up to $18 million for a periodof up to 10 years.

* commenceda cash tender offer to purchase any and all of its outstanding aggregate principalamount of its 8.875% senior notesdue 2017.


* The stricterguidelines set for the recovery plans for Brazil's systemically important banksare credit positive, Moody'ssaid. "The new requirement is credit positive because it will improve transparencyand regulatory oversight, and will create a roadmap to help systemically importantbanks manage periods of heightened financial stress, helping reduce moral hazardand contain systemic risks," the rating agency noted.

* Latin Americais approaching a "new normal"as dampened global trade, China's deceleration, lower commodity prices and weakerinvestments push the region into a period of contained growth, Fitch Ratings said.

* The U.K.'svote in favor of Brexit could indirectlyimpact the performance of Latin American banks and insurance companies by increasingtheir funding costs and contributing to the continued depreciation of local currencies,S&P Global Ratings said. Although it is still too early to judge how Brexitwill impact Latin American financial institutions, higher funding costs will likelyput pressure on their profitability and net interest margins, especially since itwill be difficult to transfer these costs to borrowers amid sluggish economic growth,S&P analyst Cynthia Cohen Freue said.

* The profitabilityof Mexican banks may benefitfrom the recent increase in the interest rate target of the country's central bank,Banco de México, Fitchsaid. The rating agency sees the higher interest rate translating into wider netinterest margins for the country's banks and greater incentives to grow credit activity.

In other news

* Germany'sCommerzbank AG and Citigrouphave ended their correspondentbanking relationships, or CBRs, with the Central Bank of Belize in recent monthsamid global de-risking strategies that have affected various banks in Belize.

* Argentina'scentral bank, Banco Central de laRepública Argentina, decided to cutits 35-day benchmark interest rate by another 50 basis points to 30.25%.

* State-runbank Caixa Econômica Federalmay require a capital injectionof at least 5 billion reais from the national Treasury this year in order to maintainits growth pace. According to calculations, the financial institution will needto deposit 4 billion reais to plug an 8.8 billion reais shortfall from 2015 in itsemployee pension fund Funcef.

* Uruguay'spublic banks will no longer offer extended opening hours as collective bargainingnegotiations with thenational banking union, AEBU, have stalled over salary demands. The measure willextend at least until July 12.

Featured this week on S&PGlobal Market Intelligence            

* : Despite a crippling recession in Brazilthat has resulted in nonperforming loans reaching a record high, a number of thecountry's lenders were among the best-performing bank stocks in Latin America andthe Caribbean.

* : Argentina wipesout the tracks of Kirchnerism; budget-deficient Dilma Rousseff goes crowd funding;and a Mexican bank takes a step toward gender inclusion.

* : A weekly rundownof executive management, board and other personnel moves at Latin American financialinstitutions.

* : A summary of variousratings actions on Latin American financial institutions and economies.

S&P Global Ratings and S&P Global MarketIntelligence are owned by S&P Global Inc.