Stable returns is the main characteristic of real estate funds which in Costa Rica have shown annualized growth of 26% in their net assets.
An article in Nacion.com reports that "...Real estate funds spent $284.2 million on the acquisition of 32 buildings between April2016 and March 2017. As of March, net assets managed by the seven investment fund management companies (SAFI) amounted to¢754,255 million, after a year-on-year increase of 26%, according to the Superintendency of Securities (Sugeval)."
Atlantis Group is negotiating with Citigroup to acquire the insurer SISA and the consumer banking portfolio in El Salvador, where it will seek to operate a management and stock brokerage fund.
The group, from Honduras, has operated in El Salvador since it bought Citigroup's 75% stake in the pension fund manager AFP Confia. Now it aims to consolidate its participation in the Salvadoran financial market with a brokerage and investment fund management company.
The subsidiary of Grupo Financiero Ficohsa will focus on supplementary pension schemes administered using the investment fund model.
The pension funds offered by the Ficohsa Financial Group through its subsidiary are mainly aimed at professionals and companies in the private sector.
Eleconomista.net reports that "... Ficohsa Pensiones y Cesantías, is a supplementary pension fund for its members through means of an individual account, which grows with the contributions made plus the return or interest generated by the investments. "
With an initial capital of $5 million a company called Confianza-SA-FGR has started operating and will focus on the management of funds for the issuance of guarantees for loans.
Confianza-SA-FGR's main objective is the management of funds for the issuance of guarantees to back loans mainly for small and medium enterprises in agricultural, vocational technical education, and social housing projects.
Managers from investment funds and pension in Central America will be meeting in Panama City on August 19th.
Marielena García Maritano, president of the Panamanian Chamber of Managers of Mutual Funds and Pension Funds (Casip) told Capital.com.pa that the purpose of the event is "... to give participants information about the platforms and infrastructure for the fund business. "
Through a mutual fund, the World Bank and other multilateral institutions, will be awarding $50 million to finance small and medium enterprises in the region.
With a mix of capital and a long-term soft loan the III Caseif fund, managed by Lafise Panama, will have $50 million for small and medium businesses who require funds to finance their operations.
The government signed a trust agreement with Banco Atlantida to invest resources in the field of telecommunications and information technology.
With this trust an investment fund will be created for investments that will allow projects to be implemented in the area of telecommunications and information technologies.
"According to the contract, it is indicated that investments will be made in the area of telecommunications and their applications in information technology and communication, as well as facilitating access to the internet."
Investment Fund Managers in Costa Rica are looking to market their securities across Central America.
Some of these companies have many years experience in foreign markets and other started this year in 2013. For example the two funds belonging to Improsa SAFI have been authorized in Panama since 2009, while others such as Interbolsa, resumed this year the work of internationalization in all countries.
According to information supplied by Thompson Reuters confirmed by President Lobo, at this interest rate they received offers worth $2.5 billion, placing only $500 million.
(ARTICLE EDITED after publication)
According to information supplied by Thompson Reuters "On Tuesday Honduras released sovereign bonds worth $500 million, up to 2024 with a yield of 7.5 percent, or a difference of 547.9 base points compared to the equivalent certificates from the Treasury of the United States, published IFR, a financial information service by Thompson Reuters."
93% of the $58 million raised by the securitization of future revenues of the International Airport of El Salvador were provided by Pension Funds.
Editorial
The administrators of the pension funds are obliged to invest mainly in government bonds, and this significantly affects the low returns earned by contributors in those funds.
The case of the securitization by the Autonomous Executive Port Commission (CEPA) to obtain funds to finance the modernization of El Salvador International Airport, is a good example of how we can better invest capital from pension funds, while obtaining better financing for public works, and so that the financial profits stay within the country.
The Inter-American Development Bank will provide $153 million to a new capital investment platform for Latin America and the Caribbean, in partnership with the Export-Import Bank of China.
A statement from the Inter-American Development Bank (IDB) reads:
IDB approves $153 million in loans to establish an IDB and China Eximbank capital investment platform
CoreCo Central America Fund is a $54 million private investment fund, which aims to invest in SMEs in Central America that have potential for growth, stimulating the expansion of industry.
Although not limited by sector, investments are primarily aimed at companies in the following sectors: healthcare, financial services, computer / software, consumer goods, retail, logistics business and telecommunications.
Legally registered companies must also report to the tax authorities of the U.S.
This new measure will be taken to comply with the Foreign Account Tax Compliance Law (FATCA, for short), which requires information disclosure by companies where a U.S. citizen is involved.
In addition, banks who hold deposits belonging to North American clients must also report to the Internal Revenue Service (IRS), and entities that do not will be subject to a retention of 30% on the interest and dividends generated.
Financial companies must provide reports about their clients who are United States citizens under penalty of withholding 30% of the transfers that they make from that country.
The measure, which will apply from July 2013, is a consequence of the Law on Foreign Account Tax Compliance (FATCA), which requires foreign banks to sign an agreement with the Internal Revenue Service (IRS), and report this to their customers, U.S.
The small economies of Central America dictate that small or regional investments are attracting the most private equity interest.
Mark Bishop from The Provident Group explains that: "the problem with Central America was and remains, very fragmented economies, small markets and lack of experience with legal transparency –it makes putting capital in there just much more difficult– there is going to be a couple of selective opportunities but its still a difficult market to get your arms round...We thought there was going to be a lot more consolidation regionally".