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February 19, 2013 5:45 pm
Bancolombia, Colombia’s largest bank by assets, agreed on Tuesday to buy HSBC’s operations in Panama for $2.1bn, in another example of local banks swooping on their European rivals’ operations in Latin America.
The deal is part of HSBC’s strategy of withdrawing from non-essential areas where it would struggle to lead the market, but it also highlights how Latin American banks are flexing their financial muscles.
“This is the 46th sale/closure globally since the start of 2011, and it demonstrates our commitment...to concentrate on our core markets of Brazil, Mexico and Argentina,” Antonio Losada, CEO of HSBC Latin America, said in a statement.
According to the UK-based bank, as of the end of September 2012, HSBC Panama had about $7.6bn of assets, $5.7bn of loans, and $5.8bn of deposits. One Bancolombia’s board member described HSBC’s assets in Panama to the Financial Times as “the crown jewels” of those available in the region.
In December last year, one of Bancolombia’s main competitors, Davivienda, went on an acquisition spree and paid $800m for HSBC’s assets in Costa Rica, El Salvador and Honduras.
Bancolombia has $11bn of foreign subsidiary assets in Latin America, including the recent acquisitions of El Salvador’s Banco Agrícola, and a 40 per cent stake in Guatemala’s Grupo Financiero Agromercantil, or GFA.
Part of the powerful Medellín-based holding Grupo Empresarial Antioqueño, or GEA, Bancolombia is Colombia’s biggest bank in terms of deposits, with about $50bn in assets under management, and more than a fifth of the Andean country’s local loan market.
In 2011, the financial arm of the GEA, Grupo Sura, paid $3.6bn for the regional assets of Dutch bancassurer ING Groep.
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