Canadian international financial institution Bank of Nova Scotia has decided to expand its role in Chile, purchasing a 79 percent stake in Banco del Desarrollo, the seventh largest Chilean Bank, for USD 810 million. Scotiabank is buying the majority stake from three shareholders and said it expects to acquire up to 100 percent of Banco del Desarrollo through a public offering for the remaining shares. Its Chilean unit, Scotiabank Sud Americano, currently has total assets of USD 3.5 billion and 57 branches, and is active in retail banking.
Banco del Desarrollo, established in 1983, has assets of more than USD 5.1 billion and a network of 74 branches, specializing in providing financial services to the low income population. With the acquisition, Scotiabank would become the sixth-largest player in the Chilean banking market, with USD 8.6 billion in combined assets and more than 130 branches, plus Desarrollo’s 24 small business and micro-lending centers.
The bank is buying 39 percent of Banco del Desarrollo from Chilean investment firm Sociedad de Inversiones Norte Sur SA, 24 percent from Credit Agricole SA, Europe’s largest mutual-fund manager, and 16 percent from Intesa Sanpaolo SpA. The transaction is expected to close in November.
–Monica Sharma, Research Assistant
Additional Resources:
NovaScotia Bank: www.scotiabank.com.
Reuters: Scotiabank to buy Chile’s Banco del Desarrollo.
Bloomberg.com: Scotiabank Agrees to Buy Chilean Bank for $1 Billion.
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