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Banco Patagonia IPO still in play; Brazil plans 42B reais spending freeze

* Banco do Brasil SA CEO Paulo Caffarelli said the bank is still planning an initial public offering for Banco Patagonia SA, despite interest from Argentine banks in acquiring the unit, Valor Econômico reported. The executive also maintained that the company does not plan to sell off any of its core businesses to boost capital adequacy, though noted that "there are some assets that are not part of the core business" which could be sold off to further strengthen capital.

* Brazilian Finance Minister Henrique Meirelles announced a 42.1 billion reais spending freeze, larger than the expected 30 billion reais cut, as the country looks to close a fiscal budget gap, Reuters reported. The government will also abolish tax breaks for certain business sectors, which should yield about 5 billion reais in revenues.

MEXICO AND CENTRAL AMERICA

* Mexico's National Confederation of Governors, Conago, met with Asian investors in China as the country seeks to find investments after U.S. companies shifted their expansion plans in the wake of Donald Trump's presidency, Reuters reported. "We're not going to sit here with our arms crossed. We're going to turn to Asia, like we've been doing. We want the Chinese to come invest in Hidalgo," said state Governor Omar Fayad. "We want the Japanese to invest here."

* Banco de México said it booked a total surplus of 535.31 billion pesos for 2016. The central bank sent most of the funds, some 321.65 billion pesos, to the federal government, while another 207.08 billion pesos went to reserves in the event the pesos appreciates against the U.S. dollar.

* CNBV, Mexico's banking regulator, cleared Investa Bank SA Institución de Banca Múltiple of money laundering charges after an audit of the lender, Reuters reported. Investa Bank will now resume the process of acquiring Deutsche Bank's Mexican operations.

* More than 1 million Mexicans entered the financial system between 2012 and 2016 thanks to a rural credit program operated by Banco del Ahorro Nacional y Servicios Financieros S.N.C., El Economista said. The program was financed by the World Bank.

* Mexico's BBVA Bancomer SA now has four mobile applications that will not eat into consumers' mobile data usage, El Economista reported. The benefit is currently limited to those with Telcel or Movistar mobile service, but the bank is "holding talks with other cellular companies" to expand it.

BRAZIL

* Following its merger with Cetip SA – Mercados Organizados, Brazilian exchange operator BM&FBOVESPA SA will change its corporate name to B3, or Bolsa Balcão Brasil, Valor Econômico reported citing an unidentified source. The company is expected to offer more details about its post-merger plans later today.

* Banco Bradesco SA CEO Luiz Carlos Trabuco said the debt problems of major Brazilian companies during the economic crisis drove the banking sector "to the shrink," Folha de São Paulo reported. Trabuco, speaking alongside Itaú Unibanco Holding SA chief Roberto Setubal and Banco do Brasil head Paulo Caffarelli at an event, also noted that signs of credit improvement are already emerging, with stronger evidence of recovery expected in the latter part of 2017.

* The Caixa Econômica Federal workers' pension fund, FI-FGTS, is looking to invest 7 billion reais directly into the Brazilian economy this year, the fund's investment committee head Marco Aurélio Queiroz said according to Diário Comércio Indústria & Serviços.

* Efforts to change Brazil's credit card lending and receivable prepayment practices have proven to be "more complex than ... initially thought," Reinaldo Le Grazie, Banco Central do Brasil's head of monetary policy, said in an interview with Valor Econômico. Le Grazie said changes to such practices will have to be implemented gradually as to maintain equilibrium in the industry.

* Banco Nacional de Desenvolvimento Econômico e Social agreed to partner with the B2W digital platform to allow its credit cards to be used for payment on corporate sales websites, Valor Econômico reported. The newspaper called the move BNDES' first step toward becoming a digital bank.

* Jorge Picciani, the speaker of the Rio de Janeiro state legislature, was arrested by Brazilian police on allegations of corruption, Reuters reported. According to arrest warrants, five members of the state audit court and legislators will also be investigated by the federal police.

* The balance of credit operations in Brazil's financial system reached 3.070 trillion reais in February, down 3.5% from a year ago, Banco Central do Brasil said. The default rate held steady for the third consecutive month at 3.7%.

ANDEAN

* Twenty members of the Organization of American States called on Venezuela to improve its democratic standards, the Financial Times reported. "The continent is telling the [Maduro] regime to release political prisoners. It is saying it wants democracy for the country," Luis Almagro, secretary general of the organization, reportedly said. Venezuela is under threat of being suspended from the organization in a vote set for June, though such a move requires the support of two-thirds of OAS' 34 active member countries.

* José Darío Uribe, the former head of Colombia's central bank, was elected to be the new president of Flar, the Latin American reserve fund, La República reported. Uribe had served as head of Banco de la República from 2005 until January this year.

* Peruvian banks have yet to pass on lower interest rates offered by the government for new mortgages to low income families, La República reported. Four months ago, the government loaned funds to banks at a 7.1% interest rate, down from 7.8% earlier, in the hope it would lead to lower mortgage rates.

* The winner of Ecuador's presidential runoff election this weekend will find it difficult to enact the fiscal adjustments needed to stabilize the government's debt burden, Fitch Ratings warned in a note.

* Peru's Banco Agropecuario will reschedule loans, grant extensions and refinancing options to victims of the widespread flooding in the north of the country, El Comercio reported.

* Meanwhile, La República reported insurance company association is offering free insurance to volunteers involved in the emergency work associated with the flooding.

SOUTHERN CONE

* Argentina's central bank approved the sale of Citigroup's retail banking business in the country to Banco Santander Río SA, El Cronista reported. The deal, which includes 70 Citi branches, should close soon.

* Banco de Chile, Banco de Credito e Inversiones SA, Banco BICE and Grupo Security SA have applied for licenses to run blind trusts for Chilean public sector employees with private wealth, Pulso reported.

* Argentina's government plans to offer home construction loans through a group of retail banks including Banco Credicoop Cooperativo Limitado, Banco de la Provincia de Córdoba SA, Banco Hipotecario SA, Banco de la Nación Argentina and Banco Provincia de Tierra del Fuego, Cronista reported.

PAN LATIN AMERICA

* Latin American governments and companies are expected to increase bond sales as a regional economic recovery has bolstered demand, Reuters reported citing investors and bankers. "We'll still see a lot of debt refinancing deals, but there are a few first-time issuers tapping the market," Felipe Wilberg, global head of fixed income for Itaú BBA, reportedly said.

IN OTHER PARTS OF THE WORLD

* Asia-Pacific: US official says heist state-backed; China Construction 2016 profit up 1.45%

* Middle East & Africa: BoG governor resigns; Abu Dhabi fund loses US arbitration

* Europe: Brexit reactions; FCA spares banks; Lloyd's of London FY'16 profit flat

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

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.