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Brazil’s Foreign Reserves Rise from June to July

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The Banco Central do Brasil increased foreign reserves in July from the previous month. Total foreign exchange reserves for Brazil amounted to US$ 376.2 billion an increase from US$ 373.9 billion in June.

Brazil has large foreign reserves to act as a cushion for certain economic scenarios. Emerging market economies with relatively large international reserves were better suited to handle the negative effects during the global financial crisis. The higher level of foreign reserves has enabled Brazil to intervene in the foreign exchange market to stabilize their currencies in times of need. In addition, the central bank was able to provide foreign exchange swap lines to local corporations during times of economic stress.

International Reserve Management
Banco Central do Brasil manages the international reserves. Most of the international reserves are in fixed income investments, most notably sovereign bonds, government agency bonds, supranational bonds, and fixed-term bank deposits.

December 2010 Asset Allocation of International Reserves

  • 80.2% – Sovereign Bonds
  • 10.2% – Central Bank and Supranational Deposits
  • 5.9% – Government Agency Bonds
  • 1.8% – Supranational Bonds
  • 1.2% – Commercial Bank
  • 0.7% – Other Assets including Gold

Brazil’s Official Reserve Assets in Billions (USD)

Dec 2009 Dec 2010 Dec 2011 June 2012
238.50 288.575 352.012 373.910

Note: Marked-to-market positions since November, 2000.
Source: Banco Central do Brasil

Mergermarket Gets Ready to be Sold

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Private equity firm BC Partners hired Goldman Sachs Group Inc. and JPMorgan Chase & Co. to advise on the sales of Acuris. Acuris is a collection of financial news and data sites, which includes Mergermarket, Dealreporter, and Debtwire. In 2017, BC Partners sold around a 30% stake in GIC Private Limited.

Before the rebranding to Acuris, Mergermarket was part of The Financial Times Group until 2013 when it was sold off to BC Partners.

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Why Japan Post Sees Promise in Aflac

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Aflac Inc. is an American insurance company founded in 1955. The company is the biggest provider of supplemental insurance in the United States. Aflac also has major operations in Japan.

In December 2018, Japan Post Holdings (JPHLF) signaled it was spending US$ 2.64 billion for a 7-8 % stake in Aflac. The goal is that, in four years time, Aflac will become an affiliate of Japan Post. Japan Post hopes to accomplish this by becoming the largest voting shareholder of the company. The world’s 13th largest company, with 400,000 employees, Japan Post needs to expand to chase further growth, mainly because Japan Post expects the postal business to decline. Diversification is seen as the optimal route to long term stability for the holding company. Japan’s economy is worrying. Japan’s aging population means that many insurance companies are facing a shrinking customer base, Japan Post settled on a plan to expand overseas.

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RDIF and Development Agency of Serbia Agree to Explore Joint Investments

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The Russian Direct Investment Fund (RDIF) and the Development Agency of Serbia, also known as Razvojna agencija Srbije, reached an agreement to work together to identify attractive investment projects to strengthen bilateral economic ties and increase investment flows between Russia and Serbia. Russian capital and businesses are keen on investing in Serbia.

In addition, the two countries signed an agreement to cooperate on civil nuclear energy, according to state-owned Russian reactor builder Rosatom (Rosatom State Nuclear Energy Corporation). Rosatom continues to expand it business of nuclear cooperation deals in a wide number of countries.

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