A year and nine months after the merger of two of Brazil’s largest private banks, Itaú and Unibanco, the government’s anti-trust division (Conselho Administrativo de Defesa Econômica – Cade) has approved it.
The decision was unanimous and the members of Cade all emphasized that the merger did not threaten free competition although the unification did create a concentration superior to 20% in some market segments.
Fernando Furlan, one of the Cade consuls, declared that there is sharp competition in the Brazilian financial sector often the result of the presence of huge state-run banks.
The merger, as is usual in these cases in Brazil, had been under examination at Cade for eight months following analysis by other regulatory entities -(Economic Activities “Seae,” Consumer Defense “SDE” and the Central Bank).
The Itaú – Unibanco merger created the largest financial institution in Brazil at that time (2008) – a giant with assets of 651 billion reais and 57 million clients.
However, less than a year later the state-run Banco do Brasil bought out the Banco Votorantim and Nossa Caixa (the latter the state-run bank of the state of São Paulo) and once again became Brazil’s biggest financial institution.
The latest data from the Central Bank of Brazil shows Banco do Brasil with total assets of US$ 397 billion and deposits of US$ 192 billion. Itaú has US$ 343 billion in assets and $106 billion in deposits.
Show Comments (1)