Peru moved closer to restoring a bicameral system of government after a Congressional committee approved legislative reform that could lead to the creation of an upper house, or Senate, by 2011. Peru has had a single chamber system since 1992 when then-president Alberto Fujimori dissolved Congress and established a single-Chamber system under the new 1993 Constitution. The proposed upper house will contain 50 members, compared with the 120 legislators, and will have a national constituency. The reform has yet to be approved by Congress as its unlikely to be popular with the public, say analysts.
Category: Regions
Posted inDaily Brief
Ecuador Central Bank CEO Resigns
The chief executive of Ecuador’s Central Bank, Mauricio Pareja, has resigned. His decision to step down follows pressure from the Bank’s board of directors, according to local media. However, the Central Bank denied any meeting between the board and Pareja had taken place. The banking industry has been the latest target of President Rafael Correa, who is seeking to lower banking costs in the country. The name of María de Lourdes Andrade, an advisor to the president, has been suggested as a likely replacement.
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IMF Praises Peru Economic Management
The International Monetary Fund has praised Peru’s economic performance and offered a vote of confidence in President Alan García’s second attempt to run the Andean nation after disastrous consequences the first time around. “The authorities’ program is yielding significant dividends,” said the Fund. The comments came after a mission to the country to carry out the first review under its 25-month Standby Arrangement. Meanwhile, figures released Tuesday by the national statistics bureau INEI show that GDP expanded by 5.9% in March, compared with the same month in 2006, while growth for the first quarter reached 7.46%, year on year. The government is looking for growth of around 8% this year.
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Credito y Casa Pricing MXP1.4bn Issue
Mexico’s Hipotecaria Credito y Casa, the mortgage provider, is pricing this week a MXP1.4bn 2-tranche issue of certificados bursatiles. The deal includes a MXP1.2bn triple A tranche with a 7.2-year tenor, talked at 90bp-100bp over 28-day TIIE and a MXP177m A+ piece with a 7.7-year tenor talked at 190bp-200bp. The first is aimed at Afores and mutual funds and the latter at private banks. The average life is around 5 years. Barclays and Santander are joint leads. The deal comes from a MXP3bn program, of which MXP1.2bn was recently issued. It will price Thursday and settle Monday.
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Xignux Returns to Peso Market
Mexico’s Xignux, the Mexican electrical apparatus provider, is back in the market with a deal through Banamex. The double A issue from a MXP2.2bn revolving program has a partial guarantee from the underwriter. It will price over 28-day TIIE and mature in May 2014.
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Ecuador To Place $280m Domestic Debt
Ecuador will place $280m in domestic debt this week, says a report in Dow Jones, citing deputy finance minister Fausto Ortiz. The paper will have a term of between seven and 10 years and carry a coupon of 7.5%. Government debt holder the Ecuadorian Institute for Social Security (IESS) is expected to buy the paper.
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Asur Chairman Taking Control
Fernando Chico Pardo, the chairman of Mexican airport operator Aeroportuario del Sureste (Asur), launched an unsolicited tender offer Monday for a majority share of the company’s outstanding stock. The offer to buy 42.6% of the company at a price of 56 pesos ($5.19) for each ordinary share expires on 12 June. Earlier in the day, the board of Asur – in a filing with the stock exchange – said it considered the offer a fair one for investors. Chico Pardo is the founder and president of Mexican private equity firm Promecap, which bought a 24.5% stake in ITA, Asur’s strategic partner, in 2004. Asur is publicly traded on the New York Stock Exchange as well as in Mexico and was the first Mexican airport group to be privatized.
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Deutsche Poaches from Merrill in Mexico
Deutsche Bank has made five senior hires for its global markets division in Mexico City. Francois Jaubert Luengas joined as head of equity sales, Marco Antonio Rojo is appointed equities sales trader, while Monica Cardenas is on board as an equities sales advisor. They report to Rupert Hope, head of EM equity sales in the Americas and were previously with Merrill Lynch Mexico. In addition, Rodolfo Jose Rastellino has been appointed head of sales for financial institutions in the capital markets and client coverage group, reporting to Raúl Martínez-Ostos, head of capital markets and client coverage for Deutsche Bank Mexico. Carlos Hernandez also joined the team as a Mexican debt structurer, reporting to Gonzalo Barbon and Federico Infantino, co-heads of EM structuring for Latin America. Rastellino was previously head of financial institutions & public sector at ABN, while Hernandez joins from Banamex, where he was responsible for structuring and derivatives.
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Mexican Railroad Operator Raises $165m
Kansas City Southern de Mexico, the Mexican subsidiary of the US railroad company Kansas City Southern Railway, priced Monday $165m in 7 non-call 4 bonds at par to yield 7.375%. The notes, rated B2 by Moody’s following a Monday upgrade, priced at the tight end of 7.375%-7.500% guidance. Proceeds were used to call 12% of 2012 bonds. Goldman Sachs led.
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Guatemala Remittances To Reach $4.2bn
Remittances to Guatemala for the first quarter of this year reached $886.7m, an increase of 11.8% compared with the same period last year, according to the central bank. Economists predict that remittances by families living abroad – most in the US – will total $4.2bn by the end of the year.