August 9, 2010 / 12:45 PM / 9 years ago

Caixa to enter Bradesco-BB credit card venture

* Caixa to join Elo card holding, filing says

* Bradesco, Banco do Brasil formed Elo venture in April

* Credit card market thrives, fueled by consumer boom

SAO PAULO, Brazil, Aug 9 (Reuters) - Caixa Economica Federal, Brazil’s largest mortgage lender, will merge its credit and debit card business into a single brand with rivals Banco do Brasil (BBAS3.SA) and Banco Bradesco (BBDC4.SA).

Caixa, which has been expanding from mortgage lending into consumer and corporate loans as demand for new credit thrives in Latin America’s largest economy, could also increase its stake in card processor Cielo (CIEL3.SA), Bradesco said in a securities filing on Monday.

By joining the credit and debit card brand known as Elo Participacoes, Brasilia-based Caixa could tap growth in the card processing industry, which has grown at 20-plus percent rates annually since 2007.

Bradesco, the country’s second-largest non-government bank, and Banco do Brasil announced in April their plan to combine their card business into Elo. State-controlled BB is the largest lender in Latin America.

Elo manages Banco do Brasil’s and Bradesco’s stakes in Cielo, Brazil’s largest credit card processor, and clearinghouse company CBSS.

Card transactions are forecast to reach nearly $300 billion in 2010, about 20 percent more than 2009, according to the ABECS industry trade group.

Reporting by Guillermo Parra-Bernal and Elzio Barreto, editing by Dave Zimmerman

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