Itau Steps up Payroll Loan Push

Brazil’s Banco Itau, which in the past months has acquired a number of payroll deduction loan portfolios in Brazil, appears to be eager to push further into the banking subsector. A senior Itau official has told local Brazilian press that the bank is eager to increase its activity in the space in the wake of several portfolio acquisitions in October. That could include outright acquisitions, say analysts covering the sector. Moody’s’ Ceres Lisboa notes there are several well run banks facing funding difficulties which would make for attractive targets. Considered to be the most secure form of consumer loans, payroll deductions were largely pioneered by mid sized banks and have taken off in Brazil in the past three years. Large banks like Bradesco and SocGen have in the past two years bought payroll loan specialists like BMC and Cacique, respectively.