Bradesco Buys Credit Card Issuer

Brazil’s Banco Bradesco has agreed to acquire 100% of the capital stock of branded credit-card issuer Banco IBI and its subsidiaries IBI Corretora de Seguros, IBI Promotora de Vendas and IBI Participacoes for about BRL1.4bn in shares. The seller is retailer C&A and IBI is C&A’s financial unit. Banco Bradesco BBI, Bradesco’s investment banking arm, acted as the buyer’s advisor. Its legal advisor was Xavier Bernardes Braganca. S&P put the B+/B counterpart credit rating of Banco IBI on positive credit watch, which it expects to resolve when the transaction is concluded, expected in H2 2009. It says the shares issued by Bradesco represent approximately 1.6% of the bank’s capital and will not materially affect its financial profile. “Banco IBI’s core banking franchise of branded credit cards will add significant market share to Bradesco’s operations in this segment,” says S&P. Moody’s put IBI on review for upgrade, including the global long term local currency deposit rating of B1 and foreign currency deposit rating of B1.