Robert Pitfield, Scoatiabank executive in charge of international business, says the banking group is always looking for growth opportunities in 'high potential markets'. - File

Scotiabank, a top Canadian commercial banking group boasting C$412 billion in assets, has acquired new holdings in the region via a deal with a Chilean company that the parties said would be executed in a matter of days.

Scotiabank, under its agreement with Grup Cumbres (GAC), will acquire Banco de Antigua in Guatemala and select assets of Banco de Ahorro y Credit Cumbres in the Dominican Republic.

The terms of the deal were not disclosed but it includes an option to purchase Banco del Trabajo, another bank owned by GAC in Peru.

"We are always looking for the opportunity to grow strategically in high potential markets, particularly those where we have an existing footprint," said Robert Pitfield, Scotiabank's executive vice-president of international banking.

Pitfield is also chairman of Scotiabank Jamaica, the banking group's first holding in the Caribbean established more than 118 years ago.

Commitment reinforced

"Today's announcement reinforces our commitment to grow in Central America and the Caribbean," he said.

Scotiabank's hunt for assets and markets coincides with a new push by big rival Royal Bank of Canada to similarly take a bigger stake in the Caribbean. RBC is currently finalising a US$2.2 billion transaction for the RBTT Bank network, which it says will place it among the leading regional banks.

At the close of that deal, scheduled for mid-2008, RBC will have a network comparable to Scotiabank's and CIBC's whose regional business operates under the FirstCaribbean brand.

In addition, the deal would have solidified Canada's domination of regional banking assets, placing all major banks in the control of the North American country, even small National Commercial Bank (NCB), which is majority owned by Jamaican/Canadian Michael Lee Chin.

Regional assets

The value of Scotiabank's regional assets in 34 markets is approximately C$20 billion (US$19.8 billion) with the Jamaican operation valued on its 2007 balance sheet at US$3.66 billion.

FirstCaribbean commands US$11.8 billion of assets in 17 markets, with Jamaica worth $41.7 billion (US$580.4 million) while RBC has said its deal with RBTT Financial Holdings will build out a US$13.7 billion enterprise in 19 markets under the Royal Bank brand. RBTT's assets top US$8 billion, to which Jamaica contributes US$994 million.

NCB by comparison is a small $259 billion or (US$3.6 billion) outfit confined to one market.

Scotiabank already has a nominal presence in Guatemala, arriving there in 2006 when it acquired Costa Rican based Corporacion Interfin, which offered leasing products in that market, the bank said. A year later, Scotiabank opened Scotia Leasing Guatemala S.A.

But the 47-branch Banco de Antigua, which was established in 1997, adds US$82 million to its asset base, and grows its client base by 160,000.

Banco de Ahorro y Credit Cumbres is a younger and smaller operation, established in 2002 in the Dominican Republic, with assets of US$29 million and 39,000 clients.

The selected portion to be acquired by Scotiabank will be rebranded as Soluciones-Scotiabank.

business@gleanerjm.com