Scotiabank Seeks More Latin America Deals, With Focus on Mexico

bloomberg.com

By Doug Alexander Jan 15, 2015 9:54 AM MT

Bank of Nova Scotia, which has spent about C$8.5 billion ($7.1 billion) on takeovers in the past five years, is seeking more deals in Latin America as it focuses on Mexico, Chief Executive Officer Bian Porter said.

“We intend to continue to be acquisitive as a bank,” Porter, 56, said today at a mergers-and-acquisitions conference in Toronto.

Scotiabank is preparing for more consolidation among lenders in Mexico, one of four Latin American countries the Toronto-based lender has focused on for growth.

“We’re trying to run our bank as efficiently as we can in Mexico, we’re making the technology improvements and upgrading people, all those type of things, to get ready for what we view as the next round of consolidation,” Porter said. “I don’t know whether it’s going to happen in ’15, ’16 or ’17, but we want to be in the room for it.”

Porter said it’s also a good time to buy as Spanish lenders Banco Santander SA (SAN) and Banco Bilbao Vizcaya Argentaria SA (BBVA), and London-based HSBC Holdings Plc (HSBA) scale back in Latin America.

“We’re still seeing some of the global banks shedding assets in what they call non-core and we’re taking advantage of that,” Porter said, adding that the bank hasn’t faced much competition when bidding for assets in the region.

Scotiabank has three deals awaiting completion in Uruguay, Peru and Chile with a total purchase price of about C$600 million, Porter said. The bank, which operates in more than 55 countries in Latin America, the Caribbean and Asia, agreed last month to buy Citigroup Inc.’s retail- and commercial-banking businesses in Peru for an undisclosed price.
 

Mexico Auto Sales Climb to Highest in Six Years as Lending Grows

By Brendan Case January 08, 2014

 businessweek.com

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Annual auto sales in Mexico rose to the highest level since 2007 as car financing expanded and the economy grew for the fourth straight year.

Buyers in Mexico pushed purchases up 7.7 percent last year to 1.06 million vehicles, a trade group representing auto dealers said today in Mexico City. Last month’s 119,364 new-car purchases were the most for any month since December 2007.

The results were buoyed by the number of vehicles bought on credit, which jumped 13 percent during the first 11 months of the year, the latest period for which figures are available, according to the Mexican Auto Dealers Association.

“We’re seeing a rebound from purchases that were delayed during the crisis years,” Guillermo Rosales, executive director of institutional relations at the dealers group, told reporters in Mexico City. “Six years after the crisis, we’re just getting back to the sales level of 2008 and we’re still below 2007.”

Domestic sales may reach as many as 1.15 million vehicles this year, beating the 2006 record high of 1.14 million, Rosales said. The Mexican economy may expand 3.5 percent this year, more than twice as fast as the 1.3 percent growth rate seen for 2013, according to estimates compiled by Bloomberg.

Nissan Motor Co. led the market last year with a 25 percent share, followed by General Motors Co. (GM:US)’s 19 percent and Volkswagen AG (VOW) with 14 percent.

Used-Car Imports

 

Auto sales would be higher if Mexico imported fewer used cars from the U.S., Rosales said. Mexico’s used-car imports totaled 568,286 during the first 11 months of last year, 41 percent more than a year earlier, according to the dealers association, which supports stricter limits.

“The potential market is 50 percent bigger than what we have,” Rosales said. “Potential demand in Mexico is about 1.6 million vehicles a year.”

Auto output in Mexico climbed 1.7 percent last year to a record 2.93 million, the Mexican Auto Industry Association said today. Exports advanced 2.9 percent to 2.42 million, with the U.S. accounting for 68 percent of foreign shipments.