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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