Monday, November 21, 2011

EconomicsBrazil: China Construction Bank: Buys up a little bank in Brazil

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Financial Times (November21,2k)
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November 20, 2011 10:03 pm

Chinese lender aims to secure 


Brazil foothold


China Construction Bank is in talks to buy a bank in Brazil
amid plans to open a subsidiary in Latin America’s
biggest economy, according to officials and people
familiar with the matter.
The move comes as the leading Chinese banks are
moving into Latin America to service rising trade 
with the region and to encourage South American
exporters to begin trading in China’s currency, the
renminbi, rather than the dollar.

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John Weinshank,
senior vice-president
at CCB’s New York
branch, told a
banking conference
in Miami that the
executive board of
the world’s second-
largest lender by
market value had
approved a proposal
to open a subsidiary
in Brazil.
“We are following
our customers,” Mr
Weinshank told the
annual conference of
Felaban, the Latin American banking federation,
adding that the proposal still needed the approval
of regulators in both countries.
Separately, a person in São Paulo familiar with the
matter said CCB had opened talks with the owners
of a small Brazilian bank over a potential acquisition
of the institution.
The person declined to name the target, but said
entry into Brazil through an acquisition would
provide CCB with the necessary licences and
permits more easily than starting from scratch.
China overtook the US to become Brazil’s largest
trading partner in 2009 and its biggest foreign
investor last year as companies ranging from car
manufacturers to engineering firms are looking to
set up in the Latin American economy.
Chen Jin, head of international financial
institutions for Industrial and Commercial
Bank of China in Beijing, told the Felaban
conference that the group is establishing
branches in Brazil and Peru as it seeks to
help its clients with their businesses in
Latin America.
ICBC has also bought 80 per cent of
Standard Bank in Argentina, a deal that
is awaiting shareholder approval, she
said.

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