By Lise Alves, Senior Contributing Reporter
SÃO PAULO, BRAZIL – Brazil’s second largest private bank, Bradesco, has announced it has purchased HSBC’s operations in Brazil for R$17.6 billion (US$5.186 billion). Although the purchase will include most of HSBC’s business in Brazil, the foreign financial institution has said that it plans to maintain a small presence in the country to serve corporate clients. With the purchase, Bradesco will narrow the difference between itself and Brazil’s largest private bank, Itau-Unibanco.
“Bradesco will take over all operations of HSBC in Brazil, including retail, insurance and asset management, as well as all the branches and clients,” said the statement issued on Sunday night, August 2nd, by the Brazilian institution. Financial analysts had predicted in July that the purchasing price for HSBC operations would be around R$12 billion.
According to HSBC it currently has over five million account holders in the country, 851 branches, 1,809 self service stations and 4,728 ATM machines in 529 municipalities. The bank, headquartered in Curitiba, had been in Brazil since 1997 and was the second largest foreign bank in the country.
At the end 2014 although registering a net worth of over R$10 billion in Brazil, it registered a net loss in the country of R$549 million. In June, HSBC announced it was promoting structural changes in its operations to reduce costs and focus more on the Asian market. The financial institution announced then it was seeking a buyer for its operation in the South American country.
Although the purchase still needs to be approved by Brazil’s anti-trust agency, CADE, before being finalized analysts say that no problems are expected.