Insurance - Mexico

XXI Banorte merger positive, but commissions unlikely to fall further in 2012 - Fitch

XXI Banorte merger positive, but commissions unlikely to fall further in 2012 - Fitch

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The merger of Mexican pension fund managers Afore XXI and Afore Banorte is positive due to the strong possibility of operational synergies in the newly formed Afore XXI Banorte, Fitch investment and pension funds division manager Mónica Ibarra García told BNamericas.

XXI Banorte will be able to take advantage of additional investment vehicles that Banorte manages, but which XXI previously did not, Ibarra García said.

As a result of the merger, XXI Banorte was able to reduce commission charges to 1.33% from 1.40% for XXI and 1.48% for Banorte as of November 2011, according to local regulator Consar's statistics.

But changes in commission charges do not occur very frequently, and it is unlikely that Afore XXI Banorte will further cut rates in 2012, the analyst said.

The merged funds began operations as Afore XXI Banorte on Monday.