| | |  Business News | October 2008 
Mexican Lawmakers May Seek More Disclosure on Derivatives
 Jens Erik Gould - Bloomberg
go to original
Mexican lawmakers are drafting an initiative that would require public companies to report purchases of financial derivatives and calculate the potential risk after firms disclosed losses tied to such operations.
Lawmakers met with Central Bank Governor Guillermo Ortiz to discuss the proposal, which aims to make it easier for authorities, ratings agencies and investors to monitor companies' derivatives positions, said Gustavo Madero, the Senate leader for President Felipe Calderon's National Action Party. Companies would be sanctioned for not disclosing purchases, he said.
``We want this to be transparent,'' Madero said today in an interview with Mexico City-based Radio Formula. Companies ``will have to calculate the implicit risk of what is being acquired and reveal it in their quarterly reports so there are no surprises.''
Mexico's National Banking and Securities Commission is reviewing whether banks that sold financial derivatives, and companies that bought them, violated regulations on disclosure or other rules. Losses on such contracts helped lead to the bankruptcy of retailer Controladora Comercial Mexicana SAB.
Mexican companies including Grupo Posadas SAB, Alfa SAB and Vitro SAB this month have disclosed losses tied to financial derivatives. Gruma SAB, the world's largest maker of corn flour, said it will take a third-quarter non-cash charge of $291.4 million related to currency derivatives.
Guillermo Babatz, president of the banking commission, said Oct. 14 that Mexican companies should have reported positions in financial contracts linked to the currency.
Lawmakers may debate the initiative before the end of the year, and it won't be put to a vote until next year, Madero said.
To contact the reporter on this story: Jens Erik Gould in Mexico City at jgould9(at)bloomberg.net |
|
| |
Vallarta Weddings
Tell a Friend
Site Map
Print this Page
Email Us