Roundup: First BanCorp narrows Q2 losses, Standard Bank unit, BCI affirmed

- Monday, August 8, 2011

Roundup: First BanCorp narrows Q2 losses, Standard Bank unit, BCI affirmed

Puerto Rico's First BanCorp (NYSE: FBP) reported a US$14.9mn loss in 2Q11, 84% less than in the same period in 2010, on lower provisions, mainly a result of lower charges to specific reserves for impaired loans, as well as lower charges to general reserves, the company said in an earnings release.

"While this quarter results reflected improvements in credit quality, [the] economy and market conditions continue to pose challenges to our industry," First BanCorp president and CEO Aurelio Alemán said.

In 2Q11, First BanCorp signed agreements with private equity firm Thomas H Lee Partners (THL), two funds managed by Oaktree Capital Management and two other investors, for a total of US$525mn.

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Through the investment, THL and the Oaktree funds will each own 24.4% of First BanCorp upon completing the capital increase and after taking into account the conversion of the TARP money that First Bancorp received from the US government.

The transaction is expected to close during the third quarter of 2011.

To read First BanCorp's earnings release, go to this link

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Moody's has placed Standard Bank Argentina's ratings on review for possible downgrade following the announcement of Chinese bank ICBC's acquisition of an 80% stake in the company, and uncertainties regarding the new owner's strategy and growth plans, as well as the level and probability of financial support from ICBC.

The transaction also entails execution and implementation risks in light of ICBC's relative lack of experience in the Argentine market, the report reads.

The ratings under review include the bank's D bank financial strength rating, Ba1 local currency deposit and unsecured debt ratings, and Aaa national scale local currency deposit and debt ratings, Moody's said in a report.

To read the full report, go to this link

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Chilean ratings agency Feller Rate has affirmed local bank BCI's AA+ rating, as well as its stable outlook, due to the bank's good financial profile, growing returns and improvements in its operating efficiency and risk management.

The agency also took into consideration BCI's strengthened capital base, its solid competitive position, leading market shares in demand deposits and cash management, and its management's know-how.

BCI is Chile's fourth largest bank and is 64% owned by the local Yarur family.

To read the full report, in Spanish, go to this link