Mexican Banks Pull Out Of A Dive

Tough action and fiscal restraint head off a full-scale collapse

At Mexico City's glass-domed stock exchange, financial analysts packed a conference room recently for a briefing on Banca Serfin, Mexico's third-largest bank. The news certainly sounded bad: Serfin lost $50 million in the second quarter, and 45% of its loan portfolio was uncollectible. Yet Serfin's share price rallied 11.5%, to 4.35 pesos a share.

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