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Scotiabank agrees to purchase Corporación Interfin

Special to A.M. Costa Rica


Scotiabank said Tuesday that it has agreed to buy Corporación Interfin for $293.5 million. Corporación Interfin is the parent of Banco Interfin, Costa Rica’s largest private bank.

Scotia will merge its existing facilties here with Interfin, resulting in a 13 per cent loan market share, it said. Subject to regulatory approval, the transaction is expected to close in about two month’s time and will be undertaken through a public share offering.

“Scotiabank has deep roots and a long history in Latin America and we are proud to grow our operations in this region, where we have become a leading bank,” said Rick Waugh, Scotiabank president and chief executive officer. “Acquiring Interfin complements our strategy of investing in high growth markets where we anticipate increased demand for financial services."

"This region is an increasingly important part of Scotiabank’s international strategy, and we have built a strong franchise by delivering superior service and by providing financial stability.”

“Scotiabank’s focus on customer service and teamwork are absolutely consistent with the culture we have maintained at Corporación Interfin, which assures us that our customers and the members of the Interfin team will find themselves in a familiar environment,” said Luis Liberman, chief executive officer of Interfin.

Scotiabank has operated in Costa Rica since 1995. The bank’s subsidiary has about 300 employees, plus 39 automated banking machines and 17 branches, offering retail, commercial and cash management services.

Founded in 1979, Interfin has 24 branches, 36 automatic tellers and about 950 employees. Scotiabank’s combined Costa Rican operation will have 41 branches, 75 automatic tellers, with about $1.6 billion in assets and $1 billion in deposits, Scotia said in its announcement.
In Latin America, Scotiabank already operates in Mexico, Perú, El Salvador, the Dominican Republic, Puerto Rico, Panamá, Belize and Chile, with an affiliate in Venezuela and a representative office in Brazil.

“Scotiabank will be leveraging proven, bank-wide capabilities to expand our product and services offerings,” said Brian Brady, Scotiabank’s country head in Costa Rica.

Scotiabank, based in Toronto, has more than 55,000 employees, Scotiabank Group and its affiliates serve about 10 million customers in some 50 countries around the world. With $357 billion in assets, Scotiabank trades on the Toronto and New York stock exchanges.

The Interfin Corporation began in 1979 with the foundation of the International Finance Corp., a financial enterprise dedicated to financing and international commerce to industrial and commercial businesses. Interfin Bank was approved in 1982.

Interfin bank has branch offices in Alajuela, Barva, Cartago, Curridabat, Desamparados, Escazu, global Park, Guapiles, Heredia, Laureles, Las Flores, Los Suenos, Novacentro, Plaza America, Rohrmoser, Sabana, San Francisco, downtown San José, San Pedro, San Carlos and Tibas.

In addition to Banco Interfin S.A, the Corporación Interfin S.A. operates Transamerica Bank and Trust Company Ltd. in the Bahamas, Interfin Valores, Puesto de Bolsa S.A., a stock brokerage and investment service; Interfin Banex Pensiones S.A., a special unit to manage pension funds with 34,000 clients.

Also, Corporación Privada de Inversiones de Centroamérica, S.A. CPI. a firm speciaizing in commercial financing; Arrendadora Interfin S.A., a firm that leases heavy equipment; Arrendadora Interfin Guatemala S.A.; Arrendadora Interfin Nicaragua; Arrendadora Interfin Honduras S.A; Arrendadora Interfin Panamá S.A,; Arrendadora Interfin El Salvador S.A de CV, and Financiera Arrendadora Centroamericana S.A.

One other small point...Panama has many more banks to choose from (over 100), and stronger bank privacy laws than Costa Rica.

it trades on the NYSE as BNS.

apparently a powerhouse in Canadian banking

now about $40 a share with about $1.25 dividend annual.

up today (at present) on the news of the new bank purchase (apparently now the largest private bank in CR)

Is it possible you could post to a thread and not somehow mention Panama? We all, by this time, know you consider Panama superior in every respect to CR no reason to beat a dead horse.

is the Scotiabank in CR the same as in Canada and the U.S?

Costa Rica



Foreigners Control 92% Of Private Banks
This week the Bank of Nova Scotia, located in Toronto, Canada, announced its purchase of Costa Rica's largest private bank, Interfin, leaving only two private banks with Costa Rican capital.

During the last several years international financial groups have been acquiring private banks in Costa Rica, that 91.7% of assets are in the hands of foreigners, while only 8.3% in the hands of Costa Ricans.

In May of 2005, GE Consumer Finance (part of General Electric) acquired 49.9% of the Red Financiera BAC, owner of BAC San José bank and Credomatic. Prior to the GE purchase, BAC San José was known as Banco San José, owned by the Pella family of Nicaragua.

In April of 2005, the Banco Popular de Puerto Rico announced its interest and purchase of 20% of Corporación BUC internacional (Cuscatlan). The deal fell apart two months ago. Cuscatlan is owned by interests in El Salvador.

The general manager of the state bank Banco de Costa Rica (BCR), Carlos Fernández, said that Costa Rica is a nation that due to its size, productivity, income per capita, level of exports and imports, does not require so many banks.

Fernández warns that the arrival of so many banks in Central America and Costa Rica in particular strongly threatens state banks for many reasons. Fernández, compared the arrival of private banks as a "tiger" with strong financial muscles that the state banks cannot compete.

Former Hacienda (Revenue) minister, Thelmo Vargas, added that the state banks are facing an enormous competition in such things as banking products and with leaner operating costs.

For his part, former head of the Banco Central de Costa Rica (BCCR) - the central bank, Eduardo Lizano, the Scotiabank purchase of Interfin is of great prestige to the country, in that it will surely attract more foreign investment and that from the point of view of products and services, it will force state banks to "waken up".

Eight years ago there were 26 banks in Costa Rica. Today there are 17. Experts say that within several years there may be less, but stronger and more powerful.


Private Banks in the hands of foreigners
Banco Capital Assets
Interfin-Scotia Canada us$1.165.000.000
Banex Panama us$ 758.000.000
BAC San José United States us$ 733.000.000
Cuscatlan El Salavador us$ 444.000.000
Promérica Nicaragua us$ 205.000.000
Lafise Nicaragua us$ 174.000.000
Citibank Unites States us$ 87.000.000
Uno Panama us$ 76.000.000
Cathay China us$ 41.000.000
BCT Costa Rica us$ 103.000.000
Improsa Costa Rica us$ 234.000.000

Costa Rica is a fine place to live ...

Costa Ricans Speak Out on Immigration
Many Costa Ricans view immigration as a problem for their country, but have different views of Colombian versus Nicaraguan immigrants, according to a study released yesterday by Universidad Nacional (UNA) in Heredia, north of San José.
Of those surveyed, 16.2% said Colombians are “nice,” while only 2% described Nicaraguans that way; 27.2% said Nicaraguans are “antisocial.” However, the quality most often attributed to both groups was “hard-working,” with 35.5% describing Nicaraguans that way and 26.4% for Colombians.
Of those surveyed, 79% said Nicaraguans face a great deal of discrimination here.
The most recent national census, conducted in 2000, showed Nicaraguans made up 76% of Costa Rica's immigrant population, followed by Panamanians, U.S. citizens and Colombians.
-ACAN-EFE