In for the Long Haul
Richard Frank, CEO of Darby Overseas Investments, which has taken positions in more than a half-dozen Latin American banks, explains why the segment remains attractive for private equity.
How long has Darby been investing in Latin America's
financial sector?The very first investment that Darby made back
in 1994 was in Interbank in Peru. And that was when Carlos
Rodríguez Pastor, the father who was the minister of
finance, with a number of friends and some institutions like
ourselves, bought Interbank out of the then-nationalized
banking scheme. Since that period, we have invested quite
heavily in that sector in almost all the countries in the
region. What are the main drivers for Darby's interest? Is it
all the same basic reasons that everyone else sees: That
consumer credit can only grow, that purchasing power is on the
rise, these economies are expanding and they have young
demographics?Those would be a starting point, but two other
things come to mind. We see the financial services area in
Latin America as still underdeveloped and we see the
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