trending Market Intelligence /marketintelligence/en/news-insights/trending/Rviq8VS0hwDE0ljG03fTiA2 content esgSubNav
In This List

Brazil mulls 20B reais fiscal boost; Dominican Republic maintains key rate


Street Talk | Episode 94: Recessionary fears in ’22 overblown, Fed could overtighten


Insight Weekly: Ukraine war impact on mining; US bank growth slowdown; cloud computing headwinds


Investment Banking Essentials Newsletter April Edition - 2022


Banking Essentials Newsletter April Edition - 2022

Brazil mulls 20B reais fiscal boost; Dominican Republic maintains key rate

* The Brazilian government is thinking of putting together a fiscal stimulus package of about 20 billion reais, possibly sourced from the FGTS workers' guarantee funds, Reuters reported, citing sources speaking anonymously. Economy Minister Paulo Guedes said late in May the government plans on freeing up FGTS accounts, but only after the pension reform is enacted.

* Banco Central de la República Dominicana kept its benchmark interest rate at 5.50% per annum. Accumulated inflation for the first four months of 2019 stood at 1.39%. The central bank also forecast inflation to remain within the 3.0%-5.0% range by the end of the year.


* Banco Aliado SA approved a deal to indirectly acquire the shares of Banco Panamá SA. Aliado's subsidiary Allied Pacific subscribed to a merger agreement with Banco Panamá's parent company, Grupo Centenario. Shareholders of Grupo Centenario will receive $210 million in return.

* The Mexican peso dipped as much as 3.62% on May 31 after U.S. President Donald Trump announced tariffs on all Mexican goods, Reuters reported. Meanwhile, Mexican Economy Minister Graciela Marquez will meet with U.S. Commerce Secretary Wilbur Ross in Washington on June 3 to try to resolve the issue.

* Gabriela Ramos, director of the Organisation for Economic Co-operation and Development, said that the loss of confidence and the paralysis of investments are the main risks of the trade war between Mexico and the U.S., El Financiero reported.


* Banco Nacional de Desenvolvimento Econômico e Social repaid some 30 billion reais to the Brazilian treasury, having returned some 340 billion reais in debt owed to the state since it began the effort in 2015. BNDES said it plans to pay down another 23 billion reais before the end of the year.

* Porto Seguro SA's shareholders approved the appointment of Bruno Garfinkel as the Brazilian insurer's chairman, and elected Ana Luiza Garfinkel as board director. Bruno Garfinkel replaces his father, Jayme Garfinkel, as chairman.

* B3 SA - Brasil Bolsa Balcão's announcement that it would begin settling cash equities trades in two days instead of three is credit positive for the stock exchange operator, Moody's said. By lessening the time frame for settlement by a day, the default risk that B3 is exposed to from market participants will lower, as the total number of unsettled trades and their market value at a given time will be reduced.

* Moody's believes that Banco BTG Pactual SA's planned secondary public offering and its transfer of a majority of its held stake in Switzerland's EFG International AG to BTG Pactual Holding S.A. is credit positive as it will support the company's business. "Shrinking the EFGI stake will reduce the volatility in BTG's capitalization ratios caused by share price fluctuation," the rating agency said.

* Brazil's central bank reported a primary fiscal surplus of 6.64 billion reais, or about $1.68 billion, for the month of April, Reuters reported. The primary deficit for the year through April represented 1.37% of GDP.

* Banco Santander (Brasil) SA reached a deal with a São Paulo city council committee investigating tax fraud, and has pledged to pay 195.57 million reais in unpaid taxes, Valor Econômico reported. This would mean the council will withdraw its complaint, and the bank's officials will no longer have to appear before the council over the alleged tax deficiencies in Santander Brasil's leasing business, O Estado de S.Paulo reported separately.

* The new law that regulates the relationship between the Brazilian public treasury and the central bank will involve the cancellation of 70 billion reais in securities transferred to the monetary authority, Valor Econômico reported. The cancellation will generate an annual saving of 4.5 billion reais in interest expenses to the public treasury.

* The Brazilian government could obtain more than 3.7 billion reais from the sale of its common shares in IRB-Brasil Resseguros S.A., in which it holds 36,458,237 common shares, or 11.7% of the shares, Folha de S.Paulo reported, citing the privatization decree. The final sale value will depend on "market conditions."


* Colombia's central bank has elected to stop accumulating foreign reserves so it can analyze how buying dollars affects the peso exchange rate, Reuters reported. The country started to accumulate foreign reserves in September 2018 to prepare for a possible cut in its credit line with the International Monetary Fund. Foreign reserves at Banco de la República stand at $51.63 billion as of mid-May.


* Chilean President Sebastián Piñera said 2019 "will undoubtedly be more difficult" for the country's economy due to the weakening of the global and Latin American economies, and the "deterioration" in the terms of commodity exchange, Diario Financiero reported. Piñera predicted a growth of between 3% and 3.5% for this year.


* Asia-Pacific: China explains Baoshang Bank takeover; Mitsubishi UFJ cuts London workforce

* Middle East & Africa: Zimbabwe clinches IMF deal; Ghana kicks off microfinance sector cleanup

* Europe: Danske selling Estonian unit; Covéa sues Credit Suisse; crypto vigilance sought

Pablo Jiménez Arandia contributed to this article.

The Daily Dose has an editorial deadline of 8:00 a.m. São Paulo time, and scans news sources published in English, Portuguese and Spanish. Some external links may require a subscription. Links are current as of publication time, and we are not responsible if those links are unavailable later.