Category: Regions

Shareholders of Mexico’s fourth-largest financial institution, Banorte, have approved a capital increase for the bank. The increase of P$5.3 billion ($490 million) will be financed via a new issuance of ordinary shares to be distributed to shareholders at a ratio of three new shares to one existing share. Shareholders also approved an annual dividend of P$1.25 per share.

Infonavit, Mexico’s largest home financing company, has issued 20-year domestic debt worth P$1.058 billion ($98 million) with a fixed annual rate of 5.90%. The mortgage-backed debt is the fourth tranche of an offering that was launched last year. The non-profit lender said it placed most of the offering with pension funds, insurers, investment companies, and also – for the first time – with foreign investors. Infonavit said it is preparing another issue for December.

Mexico’s rate of inflation in September rose by only 0.40%, below analyst forecasts. The annual rate fell to a record low of 3.51%. Economists expect the Central Bank to continue to cut interest rates to boost growth in light of the low inflation figures. Since August 26, the Bank has cut the overnight lending rate by 50 basis points to 9.25%.

Mexican América Móvil’s Ps5 billion ($462 million) senior notes due 2016 have been rated BBB by Standard & Poor’s. Although issued in Mexican pesos, the notes will pay principal and interest in US dollars, unless investors elect to be paid in pesos. América Móvil, owned by business magnate Carlos Slim, in one of the most important telecommunication companies in Latin America, based both on the number of wireless subscribers and investments realized, which are made in high growth markets, currently with relatively low wireless penetration.