Citigroup has sold its Brazilian consumer finance units to local bank Itaú-Unibanco for R$2.77bn, as the US lender looks to withdraw from part of the country’s fiercely competitive retail banking market. Continue reading »
Brazil credit boom: the end is NOT near
If there is one thing that investors are worried about when it comes to Brazil, it is how far the country’s consumer credit boom of the past decade still has to run.
Not too much further, say critics, who point to a rise in average household expenditure on servicing debt. And indeed, private sector credit has doubled over the past decade.
But Data Popular, a research firm, has come up with a startling finding that could give hope that Brazil’s credit binge can continue – without degenerating into a bubble. Apparently, 55m Brazilians – or 40 per cent of the country’s population – don’t have a bank account. Continue reading »
Spain’s two leading lenders, Banco Santander and Banco Bilbao Vizcaya Argentaria, have long looked to Latin America for growth – and more recently to repair troubled balance sheets at home.
But while Santander has hitched its fortunes on Brazil — now its biggest market, accounting for 26 per cent of group profits last year — BBVA has focused on building up its operations in Mexico. Just last month it announced plans to funnel $3.5bn into its Mexico business over the next three years, and the country last year accounted for more than one-third of its global profits. Continue reading »
BNDES, Caixa unfazed by rating downgrade
If anyone was worried by Moody’s downgrade of BNDES and Caixa Econômica, the banks themselves seemed unruffled. Continue reading »
BNDES, Caixa: robbing Peter to pay Paul
Is the Brazilian government robbing Peter to pay Paul?
That may sound a bit harsh but it is what Moody’s seems to suggest with its downgrade of BNDES and Caixa Econômica on Thursday. Continue reading »
Citi to sign out of Brazil card business
Another foreign bank is looking to exit at least part of its business in Latin America – this time Citi with its Brazil credit card division.
Brazilian newspaper Valor Econômico reports that the local branch of Santander and domestic institution Bradesco are interested in the division, called Credicard. The group is said to be looking to sell the card unit and its consumer finance division, Credicard Financiamentos, for R$1bn and R$1.5bn in time to clock the sale in its first quarter results. Continue reading »
Banco do Brasil: borrower’s delight
On the homepage of Banco do Brasil, Brazil’s largest bank, you can take out a loan to buy a car, renovate your house or buy electronics and home appliances. Indeed, never before in Brazil has it been so easy to borrow money from a bank. Record-low interest rates are expected to make things even more attractive for borrowers.
Tipping things even further in favour of borrowers is a push by President Dilma Rousseff to encourage banks, all of them but especially those controlled by the government like Banco do Brasil, to reduce borrowing costs to further fuel lending and get the economy moving. Continue reading »
Brazil’s BNDES: crowding out, not crowding in
The BNDES, Brazil’s government-owned development bank, lent more than it set out to last year, as loan requests and loans approved reached “levels without precedent in the history of Brazil”, as the bank itself put it.
Its triumphal tone will grate with those who believe the BNDES should be shrinking, not expanding. This applies even to Luciano Coutinho, the bank’s president, who told the FT two years ago the BNDES should be “crowding in” the private sector – rather than, as it is often accused of doing, crowding it out. Continue reading »
Back with a bang: BTG in $1bn issue
By Joe Leahy and Vivianne Rodrigues
After it saved the day last year for Brazil’s mournful initial public offering market by holding one of the country’s few successful listings, BTG Pactual is back with a bang in 2013 with the first major Latin American corporate bond issue. Continue reading »
Brazil’s troubled banks get “technical adjustment”
According to Brazil’s central bank, it was just a technical adjustment. However, after a series of small bank collapses in the country recently it’s easy to understand why not everyone was convinced. Continue reading »
ABN Amro’s Brazilian come-back
Acquiring a small bank in Brazil may seem like a rather brave thing to do right now. Over the past two years, seven small or mid-sized lenders have either been closed down or changed ownership as a result of financial difficulties. Several of those cases have allegedly involved fraud.
However, if you’re a big foreign bank looking to get into Brazil and you’re savvy enough to know which bank to choose, an acquisition in the sector could be a very smart move. Not only are shareholders now willing to sell for a low price, but it can also be one of the simplest ways to get a banking licence in the country.
For this reason, ABN Amro’s acquisition of Rio de Janeiro-based Banco CR2 last week seems to make sense. Continue reading »
Brazil: saving the small banks
Brazil’s banks got another shot in the arm late on Friday night when the central bank announced changes to the country’s reserve requirements that are expected to inject R$30bn into the system.
The measure was apparently a reaction to the liquidation of small and mid-sized banks Banco Cruzeiro do Sul and another bank on Friday. Continue reading »
Banco Cruzeiro: good riddance
It may be one of the sturdiest in the world, but Brazil’s banking system can still be a rather unpleasant place for investors.
After three months of looking for a buyer for the mid-sized bankrupt lender, Banco Cruzeiro do Sul, the central bank gave up on Friday and announced it would liquidate the bank. It also shut down Banco Prosper, which Cruzeiro do Sul had been in the process of buying. Continue reading »
Brazil’s Caixa: lend, lend, lend
Brazil bulls. They do exist. Beyondbrics has found one in the form of Caixa Economico, the Brazilian bank wholly owned by the government.
The country’s largest mortgage lender on Thursday said it planned to increase its loan book by a whopping 42 per cent this year as it looks to take advantage of its private sector rivals’ retrenchment. Continue reading »
Brazil: payroll lending back in vogue
When payroll lending first came to Brazil in 1990, no one paid that much attention. The loans, which are deducted directly from borrowers’ monthly salaries, were only available to public servants at the time.
Even after a new law in 2003 opened up payroll lending to private-sector employees, only the smallest banks were interested in offering the product.
How times have changed… Continue reading »
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