UBS AG, Switzerland’s biggest lender, obtained a license to operate as a bank in Brazil after seeking authorization for more than two years, a person with direct knowledge of the decision said.
Brazil President Dilma Rousseff’s approval could be published in the nation’s official newspaper, Diario Oficial, as soon as this week, said the person, who asked not to be identified because the decision isn’t public yet.
The decision allows Zurich-based UBS to conduct proprietary trading in Brazil as well as make real-denominated loans, raise money in Brazilian markets, and underwrite stocks and local bonds. UBS decided to establish a Brazilian unit after selling its Banco Pactual SA unit in 2009 for $2.5 billion to billionaire Andre Esteves and his partners, who created Banco BTG Pactual SA.
A bank license allows UBS to “offer broader products and services to its international and local clients,” including real-related loans and bonds issued in local markets, Ricardo Almeida, a finance professor at Insper business school in Sao Paulo, said yesterday in a phone interview. “The bank can say to investors and shareholders that it has a presence in Brazil, the biggest market in Latin America.”
In addition to the banking license, UBS also won approval from the central bank to buy Brazil brokerage Link Investimentos, an acquisition that’s been awaiting approval since the deal was reached in April 2010, the person said.
UBS declined to comment, said an official who asked not to be named in accordance with company policy. The government also declined to comment, according to a press official at Rousseff’s office.