Canadian bank Scotiabank announced this week that it will buy Corporación Interfin – the parent company of Banco Interfin, Costa Rica’s largest private bank – for $293.5 million. The combined operation will have 41 branches, 75 automatic-teller machines, $1.6 billion in assets and $1 billion in deposits, and account for 13% of the Costa Rican loan market, according to a statement from Scotiabank.
“Scotiabank has deep roots and a long history in Latin America and we are proud to grow our operations in this region,” Scotiabank CEO Rick Waugh said in the statement, adding that Latin America is “an increasingly important part of Scotiabank’s international strategy.”
According to the financial daily La República, the purchase means that 91.7% of private-bank assets in Costa Rica belong to foreign banks. Only two of the 11 private banks in the country, BCT and Improsa, are Costa Rican-owned.
Carlos Fernández, general manager of state-owned Banco de Costa Rica (BCR), told the daily the arrival of so many foreign-owned private banks in recent years is a threat to public banks, comparing the two to “a loose tiger versus a tied-up donkey.”
José Rafael Brenes, manager of the Costa Rican Stock Market, said that because larger banks benefit from economy of scale, clients tend to benefit from such mergers and purchases, which also introduce new technology to banks in the country.
Scotiabank already operates in Mexico, Peru, El Salvador, the Dominican Republic, Puerto Rico, Panama, Belize and Chile, has an affiliate in Venezuela and a representative office in Brazil, and calls itself “Canada’s most international bank,” according to the statement. It has operated in Costa Rica since 1995.
The purchase is expected to be finalized within the next two months; changes in the banks’ structure or names will not be decided until the end of that period, La República reported.
Interfin was founded in 1979 and has 24 branches throughout the country.