Santander has bought back the 24.9% stake
that it does not already own in its Mexican unit, Banco Santander
Mexico from Bank of America, reinforcing its expansion
ambitions.
The eurozone’s biggest bank said it paid
$2.5bn for the stake, boosting its share in the Mexican unit to
99.9% and giving it full ownership.
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The bank added that the acquisition has a high
growth potential due to the low level of use of banking services in
the country and will raise the contribution to group profit by 2
percentage points to 7%.
“This acquisition reinforces Santander’s
commitment to Mexico, a country with a very positive outlook for
growth, and furthers the geographic diversification of our Group,”
said Emilio Botín, the bank’s chairman in a note to investors.
The agreement is subject to regulatory
approval and is expected to be completed in the third quarter of
2010.
Banco Santander Mexico, which has been part of
the Santander group since 1997, was initially sold the 24.9% stake
to BofA in 2003 for $1.6bn.
It is the third largest financial institution
in Mexico with a market share of 14.8% in deposits, 13% in loans
and a 1,095-branch network.
