Empresas Hites SA (HITES) fell, with volume more than four times the three-month average, after Chile’s bank regulator said the government will proceed with a plan to increase supervision of department-store credit cards.
The retailer slid 1.9 percent to 343 pesos at 1:47 p.m. in Santiago and earlier fell 4.2 percent. Other department-store operators also fell, with Ripley Corp SA down 2.1 percent to 479.49 pesos.
“Hites’s loans portfolio is the riskiest in the market and that creates uncertainty on the stock,” Jeanne Marie Benoit, an analyst at Celfin Capital SA, said in a phone interview today from Santiago. “Also, there are fears that the economy is decelerating and the effect that may have on domestic demand.”
Chile’s banks regulator will disclose within a month new regulations for non-bank credit card issuers and will demand that they comply with the same standards as banks, Chief Regulator Raphael Bergoeing said in an interview with Santiago- based daily La Tercera published July 8. The regulator’s communications department confirmed Bergoeing’s comments.
Hites, which says its focus is to sell to middle- and lower-income segments in Chile, had total loans outstanding of 117 billion pesos ($237 million) as of the end of 2011 and provisions reached 11 percent of its total portfolio, according to data on the company’s website.
Separately, Chile’s government reached an agreement with lawmakers to reduce the maximum interest rate that can be charged on some consumer loans, Finance Minister Felipe Larrain told reporters in Santiago today.
To contact the reporter on this story: Eduardo Thomson in Santiago at firstname.lastname@example.org
To contact the editor responsible for this story: David Papadopoulos at email@example.com