Going Big, Going Wide
Banorte, Mexico's leading regional bank, has bought Bancrecer, a bank with a strong branch network in an attempt to create a powerhouse operation that serves the enitre country.
Decisions about acquisitions of under-performing assets are rarely clear cut. So it's no surprise that Grupo Financiero Banorte's September purchase of Bancrecer, the last of the Mexican government-rescued banks to be sold, involved a careful evaluation of the pros and cons of the deal. But in the end, a bear market helped make Bancrecer's branch network attractively priced for Banorte.
By spending $174 million for Bancrecer's assets, Banorte will more than double its number of branches to 1,207 and increase its assets by some 70% to $17.5 billion, creating the third-largest bank in the country behind the Spanish and US-owned competitors. Monterrey-based Banorte has long aspired to become more than a regional bank, and bringing Bancrecer into its fold will give it a substantial presence in Mexico City and southeast and northwest regions of the country. Ultimately, Banorte is likely to...
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