UPDATE 2-Bradesco CEO retiring; insurance unit exec named

(Recasts, adds Bradesco acquisitions, share performance)

By Elzio Barreto and Aluisio Alves

SAO PAULO, Jan 12 (Reuters) - Brazil's Bradesco named a new chief executive on Monday as its CEO retires and the country's largest private-sector bank faces stiffer competition amid growing consolidation in the sector.

Bradesco (BBDC4.SA)(BBD.N) said CEO Marcio Cypriano will retire in March and be replaced by the company's insurance chief Luiz Carlos Trabuco Cappi.

The bank said in a securities filing that Cypriano's term could not be renewed after reaching the mandatory retirement age of 65. He has been CEO for 10 years.

Under Cypriano, Bradesco went on a buying spree, spending nearly 10 billion reais ($4.34 billion) to expand its consumer finance, insurance and retail banking businesses.

Speculation had been rife about Cypriano's replacement in recent weeks, with likely candidates including Trabuco Cappi, Jose Luiz Acar Pedro, the head of Bradesco's investment bank, and even Roger Agnelli, the CEO of Vale (VALE5.SA)RIO.N who had worked at the bank for 20 years before joining the mining giant.

Trabuco Cappi, currently Bradesco's vice president in charge of insurance, will have to cope with slowing domestic demand for credit and mounting competition from local rival Itau ITU.N and major global players with a presence in Brazil, such as Spain's Santander (SAN.MC) and Britain's HSBC Plc (HSBA.L).

"Bradesco should start venturing in the international arena," said Carlos Daniel Coradi, head of consulting firm Engenheiros Financeiros & Consultores. "Trabuco has a more aggressive style, more similar to Agnelli, who also came from Bradesco."

Consolidation in the banking sector has accelerated since Itau (ITAU4.SA), the country's second-largest private-sector bank, agreed to take over smaller rival Unibanco UBBR11.SA last year.

The combination of the two banks will create a behemoth with assets surpassing Bradesco's and state-owned Banco do Brasil (BBAS3.SA). Banco do Brasil agreed on Friday to pay 4.2 billion reais for a 50 percent stake in privately held Banco Votorantim, less than two months after it bought Sao Paulo state bank Nossa Caixa for 5.39 billion reais.

Local banks like Itau, Unibanco and Bradesco are also taking advantage of looser central bank regulations to snap up loan portfolios from smaller companies squeezed by the global credit crunch. ($1 = 2.302 reais) (Editing by Jeffrey Benkoe)