Brazilian Bank Consolidation to Continue

Deal activity in the mid-sized bank sector is expected to continue this year, following Bradesco’s January acquisition of Banco BMC for BRL800m and Société Generale’s February purchase of Cacique, for BRL900m, according to panel members at the 6th annual Securitization in Latin America Summit (Silas), a LatinFinance/Euromoney conference in Miami. “It’s pretty much the easiest way for these [big] banks to gain access to middle market [credit portfolios],” Eduardo Lisbôa Rocha, an executive at Boa Eseperança Recebíveis, a São Paulo-based asset securitization shop, tells LatinFinance. “We’ll see more acquisitions throughout the year,” said Rocha, who works with a range of credit providers. On Tuesday, Bradesco’s president Marcio Cypriano told attendees at an investor conference in London that his bank is hunting for assets in the sector. The race for high-yielding credit portfolios is being spurred on by the fact many mid-sized banks are lined up for IPOs. “Big banks are racing to buy up these banks before they go public and get more expensive,” says a São Paulo-based banker.