trending Market Intelligence /marketintelligence/en/news-insights/trending/XoxGKbE9k_to8g4WHJCNIA2 content esgSubNav
In This List

Peru braces for insurance losses; Brazil delays budget edict


Insight Weekly: US inflation soars; real estate faces slowdown; megadeals drive tech M&A


Commercial Banking: June 22nd Edition


Insight Weekly: Path to net-zero; US manufacturing momentum; China's lithium M&A frenzy


Commercial Banking Newsletter June Edition - 2022

Peru braces for insurance losses; Brazil delays budget edict

* Brazil Finance Minister Henrique Meirelles postponed a budget announcement until March 29 amid pressure from lawmakers to re-evaluate its use of tax increases, Reuters reported. One presidential aide reportedly said officials are "trying to avoid tax hikes altogether or implement hikes that will not have a big impact on the economy and inflation." As result, Meirelles' economic team is now looking for revenues elsewhere to cover a 52 billion reais budget gap.

* Peru's insurance industry is set for a second year of losses as torrential rains continues to wreak havoc in the northern part of the country, El Comercio reported. One RIMAC Seguros y Reaseguros SA executive reportedly noted that claims for the first quarter alone have already surpassed the amount it normally pays out during an entire year.


* A 76% stake in Costa Rican insurer Aseguradora del Istmo (ADISA) SA is being offered as part of a liquidation process involving Panama-based Istmo Cia. de Reaseguros Inc., El Financiero reported. The remaining 24% stake in the insurer will remain with a Costa Rican cooperative.

* Mexico's banking industry faces a lot of uncertainty as it seeks to maintain current growth rates of between 10% and 13% a year, HR Ratings director Fernando Montes de Oca told El Economista. Still, the rating agency doesn't expect to lower banks' credit ratings, Montes de Oca noted, since the sector is well capitalized.

* CIBanco SA Institución de Banca Múltiple CEO Mario Maciel Castro maintained that continued growth in Mexico's economy is creating solid demand for the bank products, despite ongoing uncertainty in the country, according to El Economista.

* Mexico's Banco Nacional de Comercio Exterior S.N.C. Institución de Banca de Desarrollo loaned out more than 1 billion pesos to upgrade hotels throughout the country, El Financiero reported. The loans are part of a program aimed at improving Mexico's tourism infrastructure.


* Caixa Econômica Federal posted an 11.2% rise in fourth-quarter 2016 profit as the company saw stronger net interest income and boasted its best efficiency ratio in a decade. Net profit totaled 691 million Brazilian reais for the three-month period, up from 621 million reais a year ago. For the whole of 2016, however, the state-run bank's profit sank 41.8% year over year.

* Meanwhile, Caixa CEO Gilberto Occhi reportedly said that the bank has no plans to sell any assets this year to strengthen its capital levels. It also does not expect a contribution from the federal government, and will instead rely on efficiency and profitability to bolster its capital ratios.

* Qatar Investment Authority plans to sell up to 92 million units in Banco Santander (Brasil) SA through a global secondary offering, including a 12-million-unit overallotment option. The sovereign wealth fund said that the offering represents about 40% of its ownership stake in the Brazilian bank, which currently sits at 5.5%.

* Brazilian police raided brokerage firm Advalor Distribuidora de Titulos e Valores for its alleged involvement in the Lava Jato corruption probe, Reuters reported. Authorities reportedly suspect the firm of helping large construction firms transfer bribes to Petrobras executives.

* Banco Nacional de Desenvolvimento Econômico e Social has resumed talks with the Brazilian state of Rio de Janeiro to privatize water utility Cedae, Diário Comércio Indústria & Serviços reported. Rio had committed to privatize the utility under a federal fiscal recovery agreement earlier this year, but the state must engage a federal bank to coordinate the move.

* While the global economic environment has become more uncertain, Banco Central do Brasil chief Ilan Goldfajn said that Brazil is looking less vulnerable, Diário Comércio Indústria & Serviços reported. In a speech, Goldfajn maintained that the country is on a path to economic recovery through monetary policy and wider economic policy measures to tame inflation.

* International investors cut their positions in Brazilian public debt by 85 billion reais between December 2015 and February 2017, Valor Econômico reported, citing central bank data.


* BBVA Banco Francés SA, Banco Macro SA and Grupo Financiero Galicia SA are among those that could submit bids for Argentina's Banco Patagonia SA, O Estado de São Paulo reported. Banco do Brasil SA, which owns Banco Patagonia, expects to receive non-binding offers for the unit in the coming weeks.

* Chile's insurance sector in 2016 booked an 11.8% year-over-year rise in profits, hitting $736 million, insurance regulator Superintendencia de Valores y Seguros, said. The increase came on the back of increased sales and improved investments, among other factors.

* PayPal, the digital payments company, formally announced that it is launching in Argentina through a strategic alliance with Banco Comafi SA's Nubi SA business, La Nación reported. The new offering will initially focus on serving Argentine SMEs and entrepreneurs who sell products abroad.

* International investors are returning to Argentina and will help bolster the economy, Frédéric de Courtois, CEO for global business lines and international at Italian insurer Generali, said in an interview with La Nación. The executive also predicted that more Argentines could take out life insurance products if the country can reduce inflation over the long-term.

* The board of Chile's central bank opted to take all of the cash it is entitled to under a subordinated debt agreement with Banco de Chile. As result, Banco de Chile will pay the central bank 142 billion pesos in cash from its 2016 profits, according to Pulso.

* Economic activity in Argentina fell 0.5% in January from December 2016, though increased 1.1% from a year ago period, data from government statistics agency Indec showed.


* Asia-Pacific: Citi seeks Asian insurance partner; Kotak Mahindra may buy finance company

* Middle East & Africa: Citi seeks Saudi return; Barclays Zimbabwe on the block

* Europe: UK triggers Brexit; global insured disaster losses up; RBS proposes settlement

Matthew Craze contributed to this article.

The Daily Dose has an editorial deadline of 8 a.m. São Paulo time, and scans news sources published in English, Portuguese and Spanish. Some external links may require a subscription.