Mexico

The collapse of a Mexican lender is spurring concern about risks for the banking system just as the country sinks into its deepest recession in almost a century under the watch of a financial regulator that’s been hobbled by austerity, Bloomberg News reported. Banco Famsa will need a bailout of almost $1 billion to make depositors whole. Its failure is fueling worries among former officials that the watchdog known as the CNBV could miss warning signs at other lenders after a wave of resignations followed President Andres Manuel Lopez Obrador’s drive to cut costs.

Mexican airline Aeromexico, which is in a Chapter 11 restructuring process, said on Tuesday it posted a $1.2 billion net loss for the second quarter and laid off about 2,000 workers as the coronavirus pandemic roils the airline industry, Reuters reported. “The commercial aviation industry faces unprecedented challenges stemming from a significant reduction in passenger demand worldwide,” the firm said in a statement.

Latin America is at the centre of the coronavirus pandemic, suffering some of the worst infection rates and highest death tolls in the world, the Financial Times reported. Now economists warn that the region faces more bad news: its sickly economies risk falling into a new debt crisis even worse than the last big bust of the 1980s. The continent was struggling with multiple “pre-existing conditions” before the virus took hold: anaemic growth, weak health systems, low tax revenues, high levels of borrowing and an over-reliance on commodity exports.

Mexico’s Interjet said on Monday it received a $150 million capital injection to help the company through a major restructuring in a bid to offset the crisis in the airline sector as the coronavirus pandemic choked global travel, Reuters reported. Interjet, one of Mexico’s three biggest airlines with a portfolio of more than 50 routes, announced restructure plans last month as local media speculated about the carrier’s financial health.

Mexico’s government on Thursday ruled out a financial rescue of the country’s airlines, which have been hammered by a sharp drop in global demand for travel and restrictions imposed due to the coronavirus pandemic, Reuters reported. Aeroméxico announced in late June the start of a restructuring process under Chapter 11 bankruptcy proceedings in the United States, while rival Interjet has also been struggling under the burden of coronavirus-imposed restrictions.

Mexico’s government yesterday ruled out a financial rescue of the country’s airlines, which have been hammered by a sharp drop in global demand for travel and restrictions imposed due to the coronavirus pandemic, Reuters reported.

Petroleos Mexicanos’s nearly $105 billion in debt already makes it the biggest borrower of any oil company in the world. And it’s accruing more, Bloomberg News reported. Pemex, as the Mexican state oil company is known, is asking some of its contractors if they can wait until next year to be paid money that is owed to them now. Three contractors that are being asked to defer payment are waiting on $115 million in payouts, but the amount owed to companies across Pemex’s supply chain could easily total billions of dollars.

Mexico’s Aeromexico yesterday scheduled meetings with investors to discuss debt restructuring after becoming the third large Latin American carrier to file for chapter 11 bankruptcy protection last week, Reuters reported. Management of the airline part-owned by Delta Air Lines Inc. proposed focusing on the modification of payment terms for stocks and other certificates in the meetings now planned for July 20, according to a statement sent to the Mexican stock exchange.

Mexican airline Aeromexico, which is in the process of analyzing its options for restructuring its short- and medium-term financial commitments, was thrown a $50 million financial lifeline on Monday by investment holding company Aimia Inc, Reuters reported. Aeromexico’s shares tanked earlier in June after a newspaper column said it was considering filing for bankruptcy, though the airline later clarified it had not decided whether to seek Chapter 11 protections in the United States.

Aeromexico is analyzing its options for an orderly restructuring of its short- and medium-term financial commitments, the Mexican airline said on Friday, adding that it had not decided whether to seek Chapter 11 protections in the United States, Reuters reported. Aeromexico shares fell more than 5% in early trading after a newspaper column said the Mexican airline was considering filing for bankruptcy.