Scotiabank, the third largest bank in Canada by deposits and market capitalization announced today that an agreement has been reached to acquire Citigroup Inc (NYSE:C) retail and commercial banking businesses in Panama and Costa Rica, subject to regulatory approval. Scotiabank’s common equity tier one capital ratio will be impacted by approximately 15 basis points.
This acquisition is in line with the Bank of Nova Scotia (NYSE:BNS) strategy to increase scale within its footprint and complements its operations in Panama and Costa Rica. This transaction will provide a significant lift to the Bank’s market share in credit cards to approximately 18% in Panama and 15% in Costa Rica, ranking Scotiabank number two in both countries in this segment.
Citibank’s operations in Costa Rica and Panama include 27 branches which serve more than 250,000 retail and commercial banking customers. Citibank has been operating in Costa Rica since 1968 and in Panama since 1904 and will continue to operate in these countries with a focus on its Corporate and Institutional Banking Business, and International Wealth Management Services, capitalizing on its global presence and competitive leadership position in these segments.
The agreement also includes the assumption of Citigroup employees from the retail and commercial banking businesses in Panama and Costa Rica by Scotiabank Panama and Costa Rica, respectively. Until the transaction receives the necessary regulatory approvals, all operations, branches, products and benefits programs will continue to operate as usual. Scotiabank and Citibank will work together to ensure a smooth transition for customers and employees.
About Scotiabank in Panama
– Scotiabank entered Panama in 1974 and has since grown to an operation with USD$2,700 million in assets, 16 branches and 22 ABMs.
– Scotiabank serves approximately 27,000 customers in Panama.
About Scotiabank in Costa Rica
– Scotiabank entered Costa Rica in 1995 and has since grown to an operation with USD$2,650 million in assets, 35 branches and 153 ABMs.
– Scotiabank serves approximately 110,000 customers in Costa Rica.
Scotiabank is a leading Canadian provider of foreign exchange services and research on the FX market. The latest foray into Panama and Costa Rica increases the bank’s footprint in the important LATAM market which already included Brazil, Chile, Colombia, Mexico, Peru, and Uruguay. Each day Eduardo Suarez, Senior Currency Strategist at Scotia publishes a LATAM Daily FX Update, the latest of which can be read here.
To view the official announcement on this deal, click here.