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Banrisul Q4'17 earnings spike; Rio under army control


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Banrisul Q4'17 earnings spike; Rio under army control

* Banco do Estado do Rio Grande do Sul SA reported net income of 516.4 million Brazilian reais for the fourth quarter of 2017 compared to the 165.0 million reais reported for the year-ago period. For the quarter, allowance for loan losses fell to 353.0 million reais, from 402.6 million reais a year earlier. Other recurring operational expenses also decreased to 156.9 million reais year on year.

* Brazilian President Michel Temer ordered army troops to assume control over Rio de Janeiro, aiming to control heightened violence in the state stemming from drug gangs, Reuters reported. Under law, federal intervention in states will automatically block any constitutional changes, but Temer said the intervention will not affect efforts for pension reform, which would involve constitutional amendments. Meanwhile, House Speaker Rodrigo Maia said debate on the measure would continue regardless of the intervention, Valor Econômico reported.


* A magnitude 7.2 earthquake hit Mexico on Feb. 16, damaging at least 1,000 homes in the Oaxaca state and resulting in tremors as far south as Guatemala, Reuters reported. A helicopter that surveyed the damage crashed later that evening, resulting in at least 13 deaths. The Oaxaca state later asked for federal emergency funds to supply relief services in over 30 municipalities that were affected by the quake.

* Mexican popular financial societies, or sofipos, could be at increased risk of money laundering and terrorism financing as banks reduce their exposure to certain high risk entities, El Economista reported, citing a recent report by the Financial Action Task Force. It said banks had reduced contacts with money wire providers and foreign exchange houses, leading them to use institutions with weaker controls such as sofipos as an alternative.

* Deputy Mexican central bank Governor Javier Guzmán said additional hikes to the benchmark interest rate remained possible in the coming months, citing exchange rate pressures linked to the NAFTA renegotiation and U.S. fiscal stimulus and uncertainty over this year's presidential election, according to a Notimex report carried by El Economista.

* Costa Rica's troubled Banco Crédito Agrícola de Cartago is headed towards closure, El Financiero reported, citing comments by Marco Hernández, who is leading an intervention in the state-run lender by regulators. He said the bank was suffering from a lack of liquidity and its operations were being moved to other entities.


* Fitch Ratings revised the outlook on National Commercial Bank Jamaica Ltd.'s ratings outlook to positive from stable, mirroring "the government's reduced refinancing risks due to improved market access, continued fiscal discipline, positive public debt dynamics, stronger business confidence and improved employment trends, notwithstanding a rate of real GDP growth rate well below the regional average."


* Credit recovery in Brazil rose 0.3% in January from the previous month on a seasonally adjusted basis, and increased 4.2% from a year earlier, according to data from credit research firm Boa Vista SCPC. Meanwhile, Boa Vista's credit recovery index fell 1.1% in the accumulated 12 months through January, but the firm noted that despite the drop, "some regions are already starting to show a trend reversal, indicating a gradual increase in economic activity and improvement of the labor market."

* Apollo Global Management LLC reached a deal to buy 20% in Brazil's Starboard Restructuring Partners for an undisclosed amount, Reuters reported. "Our access to capital is significantly strengthened with the agreement," Starboard founder and managing partner Fabio Vassel reportedly said, adding that the firm is looking to acquire up to six distressed medium-sized companies.


* Bolsa de Valores de Lima SAA has developed the first green bond market in Peru in partnership with the U.K., and will provide a guide for investing in these bonds in March, Gestión reported. Although investors can currently issue the bonds, the guide will have the basic principles which should be met by the bond issuers.

* Fitch Ratings believes that continued deterioration in Banco Agropecuario's loan quality and its impact on the bank's capital adequacy metrics will not likely affect its support-driven ratings. Fitch adds the Peruvian government has affirmed its support to Agrobanco as it is exploring options to increase the bank's capacity. The government has also been in direct discussions with the bank's creditors and is planning to recapitalize the bank with 450.0 million Peruvian soles this year.

* Corporación Financiera de Desarrollo SA will provide 1.00 billion Peruvian soles in guarantees on loans to micro, small and medium-sized companies affected by El Niño-linked floods last year, Gestión reported, quoting Cofide business manager José Vergara. The guarantees will also be available to borrowers who need to refinance existing debts.

* Venezuela's Popular Will opposition party will boycott presidential elections scheduled for April, describing it a "fraud," Reuters reported. The party has also called on other opposition parties to not put forward any candidates in the elections, saying that registering as a candidate would be "doing the dictatorship a favor."


* Banco Patagonia SA said it will propose to its shareholders a dividend payment worth 1.77 million Argentine pesos, based on its 2017 results. The dividend is subject to prior authorization of the central bank.

* Minutes from the Chilean central bank's January meeting showed the regulator considered a cut of 25 basis points for its benchmark rate, Reuters reported. The central bank ultimately decided to maintain it at 2.5%. The final decision reflected improvements in the country's blue chip stock market, plus appreciation in the local currency and more optimistic business expectations.

* The president of Argentina's ABA banking industry association, Claudio Cesario, said wage talks with the country's largest banking trade union are deadlocked, Clarín reported. He spoke ahead of another 48-hour strike by La Bancaria union for Feb. 19 and 20.

* The city of Buenos Aires placed 6.20 billion Argentine pesos in a reopened bond at the equivalent of the Badlar rate plus 3.75% as part of the local government's drive to improve its debt profile, El Cronista reported.

* Walter Figueroa, president of a federation grouping Banco Santander Chile's trade unions, has criticized the Labor Code's requirement for companies and unions to agree on the level of minimum services to be maintained during strikes, calling it "a stupidity" of the labor reform, Diario Financiero reported.


* The Latin America director at Lloyd's, Daniel Revilla, said that the two earthquakes in Mexico last year had highlighted low levels of insurance penetration in the region, according to a report by Spanish newswire EFE carried by Prensa Libre. He said low rates of insurance coverage hurt the victims of natural disasters as well as taxpayers.


* Middle East & Africa: Israel sets rules for credit card firm buyers; Barclays Africa wins case

* Europe: Euronext FY'17 profit up 22.5%; Saga names new chairman; Fitch upgrades Greece

Helen Popper contributed to this article.

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