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Balboa Bank, BCT Bank close merger; Brazil credit bureau probes hacking attack

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Balboa Bank, BCT Bank close merger; Brazil credit bureau probes hacking attack

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

Coming together

* Grupo Financiero BCT completed the operations merger of Panama-based Balboa Bank & Trust Corp. and BCT Bank International SA. The merger of the banks' technology platforms wrapped up Sept. 2, with the products of Balboa Bank & Trust migrated to BCT Bank International.

* The Costa Rican parliament gave preliminary approval for the proposed merger between Banco Crédito Agrícola de Cartago, also known as Bancrédito, and Banco de Costa Rica. The deal will see Banco de Costa Rica absorb businesses valued at US$4 million, as well as about 32.0 billion Costa Rican colones in equity and about 134.0 billion colones in debt, according to the report.

* A recent proposal by Mexico's President-elect Andrés Manuel López Obrador to merge state-run Banco Nacional de Comercio Exterior SNC Institución de Banca de Desarrollo and Nacional Financiera SNC Institución de Banca de Desarrollo could spur a growth in loan disbursements in the country, Moody's said. The proposal is a part of a strategy to fortify Mexico's development banking sector in a bid to lower credit costs for small and medium-sized companies.

Cyber check

* Brazilian credit bureau Boa Vista SCPC reportedly opened an investigation into a possible hacker intrusion in its system on Sept. 2. Although the company did not confirm the attack, hacking group Fatal Error published a message on a site addressed by cybersecurity experts claiming they had gained access to Boa Vista's database.

* Chilean banking regulator SBIF reported a new hacking attack against the local banking sector, forcing card issuers to block around 426 payment cards, Diario Financiero reported. Banco Falabella acknowledged being one of the affected banks and said it immediately blocked 48 cards that were compromised.

* New contingency protocols for high-value payment systems in Chile are credit positive for local banks because they will improve security and help restore customer confidence following a series of highly publicized cyberattacks targeting the country's financial sector, Moody's said.

Building bridges

* Itaú Unibanco Holding SA entered into a strategic partnership with Edenred Brasil Participações S/A, the parent company of Ticket Serviços SA, in the employee benefits market. Under the deal, Itaú will make a minority investment of 11% in Ticket through a capital increase paid in cash and with the contribution of distribution exclusivity rights regarding Ticket products to Itaú's corporate clients.

* Itaú's e-commerce partnership with PayPal Holdings Inc.'s Brazilian subsidiary is credit positive for the bank, Moody's said. The partnership, in which Itaú will offer digital wallet services to its clients, will increase payment volumes generated by the bank in e-commerce transactions, a fast-growing segment in Brazil, Moody's said.

Rules of the game

* The Chilean Senate will revive a bill first introduced in 2015 in an attempt to strengthen transparency and accountability in the national financial industry. The draft law seeks to improve corporate governance and eliminate pyramid schemes and fraud in the securities markets.

* Venezuelan banks will now be asked to deposit 100% of their legal reserve requirements to the Banco Central De Venezuela instead of 30%, as previously required. The initiative will apply to all deposits that enter after Sept. 1.

* Jorge Castaño, the head of Colombia's financial regulator Superfinanciera, revealed plans to facilitate financial result disclosures for companies listed on the local stock exchange and lower overall costs in an effort to attract more companies to the capital market.

In other news

* Banco do Brasil SA completed a transaction that increased its stake in Argentina's Banco Patagonia SA to 80.39% from 58.97%. In June, three minority shareholders in Patagonia exercised the option to sell their stake to the Brazilian bank in an operation valued at about $202.4 million.

* Chile's national consumer service agency Sernac launched a class-action lawsuit against Itaú CorpBanca, with a group of consumers claiming they were victims of fraud.

Featured this week on S&P Global Market Intelligence

* Cyberattacks on Latin American banks highlight emerging-market vulnerabilities: When Banco de Chile suffered a massive, malware-driven system failure earlier this year, the bank was caught off guard.

* Hires and Fires: A weekly rundown of executive management, board and other personnel moves at Latin American financial institutions.

* Ratings Roundup: A summary of various ratings actions on Latin American financial institutions and economies.