Scotiabank Says ‘Opportune’ Time to Buy in Asia, Latin America
Bank of Nova Scotia (BNS), which has made investments in more than 20 banks outside its native Canada over the past six years, wants to continue acquiring in Asia and Latin America as other lenders retreat.
“We view it as a very opportune time for banks such as ourselves to be acquisitive,” said Brian Porter, group head of international banking. “There are other banks out there globally that are under pressure, and we’ll be opportunistic when it makes sense for us.”
Scotiabank, which has operations in more than 50 countries, has spent at least C$2.5 billion ($2.45 billion) on international acquisitions including Brazil, Peru, the Caribbean and Chile. Over the last two months, the Toronto-based lender announced agreements to spend another $1.7 billion in China and Colombia, including yesterday’s deal to buy a controlling stake in a Colombian consumer lender.
Porter, 53, said the bank sees consolidation opportunities in Asia and Latin America, without saying which is more likely to yield agreements.
“I wouldn’t weigh one against the other,” said Porter, a former chief risk officer who became head of international banking last year. “M&A is messy; you can never control what comes your way.”
Scotiabank, established in Halifax, Nova Scotia in 1832, has expanded its global operations, which typically account for 20 percent to 30 percent of profit. The bank operated in Kingston, Jamaica before it had a branch in Toronto, according to its website.
Canada’s third-biggest bank agreed yesterday to buy a 51 percent stake in Colombia’s Banco Colpatria Red Multibanca Colpatria SA for about $1 billion, in its largest international takeover. Porter said the bank will expand where clients such as mining companies and property developers are doing business.
“We’re following our customers to Colombia and we’re very excited about it,” Porter said in a phone interview yesterday. “It’s a natural extension of our footprint and our strategy.”
Scotiabank executives told investors on a conference call yesterday that the company may expand further in Colombia as consolidation continues. Porter declined to name specific targets.
The lender is also hosting a board of directors meeting next week in Bangkok. Scotiabank and partner Thanachart Bank paid C$2.2 billion last year to buy Thailand’s Siam City Bank Pcl.
“It’s part of our evolving Asia-Pacific strategy,” said Porter, who has been with Scotiabank since 1981. “We felt it was important to take the board to Thailand and really expose them to the potential that we see for Thanachart Bank, and the potential for economic growth within Thailand and where we’re going.”
The lender is also waiting on regulatory approval to increase its stake in China’s Bank of Xi’an to more than 18 percent from 14.8 percent. Foreign banks can own two 20 percent stakes in Chinese banks.
To contact the reporter on this story: Sean B. Pasternak in Toronto at email@example.com.