BofA-Merrill Brazil Takes a Hit

BofA-Merrill Lynch’s Brazil office has suffered its first voluntary senior investment banking exit of the year, following a slew of high profile departures from the US bank elsewhere in the region. Adriano Borges, an MD who headed banking for real estate, among other sectors, will join the ranks of Itau BBA’s senior coverage bankers that include Andre Kok and Fernando Iunes, say local executives familiar with the move. Borges, who is on gardening leave, will report to Jean-Marc Etlin, head of Itau’s investment banking unit. His precise sector responsibilities have yet to be worked out, says a local banker familiar with the move. The departure makes a significant dent in the foundations of BofA-Merrill’s Brazil franchise, which – unlike New York, Mexico City and Buenos Aires – has thus far been unscathed by the ongoing senior talent drain. Borges’ move suggests turmoil related to TARP and Bank of America’s apparent void when it comes to LatAm strategy have inhibited the Brazil business. Bankers say that BofA-Merrill is struggling to win mandates across the board. This is particularly apparent in the highly competitive Brazilian equity market, which is starting to revive. Several large IPOs have been awarded already and more will likely be mandated, say local bankers. But BofA-Merrill has yet to make an appearance as a lead on any, despite a highly paid roster of seasoned ECM officials. Merrill hired Borges from Credit Suisse – where he led the Brazil real estate investment banking business – in April 2008. Merrill was the most aggressive hirer in Brazil investment banking last year, betting heavily on sustained strength in the Brazilian fee pool, which was drained by a plunge in equity volume. Sao Paulo-based recruiters expect more staff exits in the short term.