| SAO PAULO, June 9
SAO PAULO, June 9 Brazilian financial companies
are likely to pursue acquisitions abroad in coming years to take
advantage of a retrenchment by European and U.S. rivals that are
propping up capital and disposing of non-core assets, analysts
Brazil's largest non-government bank Itaú Unibanco Holding
SA and investment-banking firm Grupo BTG Pactual SA
have already signaled potential interest in markets
outside Brazil. Analysts and industry leaders say rival Banco
Bradesco SA, bourse operator BM&FBovespa SA
and insurer Porto Seguro could seek to expand
For banks, tapping revenue sources in markets outside their
home turf could help offset slowing growth, rising inflation and
payroll costs, and growing state intervention in Brazil that is
weighing down markets. The economies and capital markets of
countries like Chile, Colombia and Peru are expanding faster
than Brazil's, opening room for Brazilian financial firms to tap
new business opportunities.
"We will see some more consolidation going forward," said
João Augusto Frota Salles, an economist at banking industry
Itaú, after the takeover of Chile's CorpBanca SA,
earns 15 percent of revenues from abroad. Chief Executive
Officer Roberto Setubal said earlier this year that the bank is
keen on acquisition opportunities in Mexico and Peru "to avoid
depending only on Brazil."
Flagging capital markets activity, especially share
offerings, in Brazil is driving BTG Pactual to look for takeover
targets outside Latin America.
The São Paulo-based lender bought 2 percent of Italy's Banca
Monte dei Paschi di Siena SpA and is currently in
exclusive talks to buy Swiss asset management BSI.
"BTG Pactual will focus on opportunistic acquisitions," said
Eduardo Nishio, analyst at investment bank Brasil Plural.
Taking on a more timid approach, Bradesco has been growing
capital markets activity by winning mandates to underwrite
fixed-income deals in the United States. The bank's asset
management unit plans to boost assets under management abroad
from $1 billion to $6 billion in coming years.
And BM&FBovespa lists growing abroad as "the next item on
our agenda," Chief Executive Edemir Pinto told Reuters in a
(Editing by Guillermo Parra-Bernal and Chizu Nomiyama)