Macroeconomics

Mexico is the best place in...

As LatAm stares down a growing list of infrastructure needs, builders and governments hope private lenders return. The only certainty is multilateral and state lending.

With Petrobras’ $70 billion capitalization out of the way, other LatAm equity issuers are cleared for takeoff.

Brazil’s government-controlled lender is using a natural size advantage to pursue niches it does not already dominate. Careful international expansion is next for Banco do Brasil.

Mexican retail banks are known for making customers pay through their noses.

El Salvador’s Banco Agrícola, part of Colombia’s Bancolombia since 2007, is expected to end this year with results that compare favorably with those obtained at the end of 2009, says Fitch, which has an AA+ (stable) local rating on the bank.

State-controlled Banco de Costa Rica has gained market share through the financial crisis, growing the loan portfolio and expanding facilities.

Ecuador’s Banco Pichincha has been busy expanding within and beyond the country’s borders. At the same time, it has been able to keep its financial indicators in line with or better than that of the banking system as a whole.

Jamaica’s National Commercial Bank (NCB) has passed the test of a weak local economy and a sovereign debt restructuring relatively unscathed, as profitability and liquidity remain at acceptable levels.

Puerto Rico has been suffering a recession for more than four years. Several banks have collapsed, unemployment has soared and bankruptcies have increased.

Trinidad & Tobago’s (T&T) Republic Bank has been able to grow its assets despite a weak economy and reduction in its loan portfolio.

Crime and political rifts continue to block progress towards unity in Central America. Strides towards forging critical mass have been made, but full integration is lagging.

Mezzanine financing is not as widely available from private equity firms in LatAm as in other emerging markets. This could start to change soon as both sides learn of the benefits.