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Credito Real’s Missed Bond Payment Fuels Sector Risk, Moody’s Says

  • Failure to pay is negative for Mexican finance companies
  • Transparency, governance improvements necessary, Moody’s says

Mexico’s financial industry will need to embrace transparency and accounting disclosure to rebuild the confidence of investors rattled by Credito Real SAB’s missed bond payment, according to Moody’s Investors Service. 

The non-bank lender’s failure to repay holders of 170 million in Swiss franc ($184 million) bonds last week will be a drag for market peers -- especially those that have limited financial flexibility or bondholder protection, analysts Felipe Carvallo and Luis Fernando Baza said in a report.