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Scotiabank to buy 51% controlling stake in Banco Cencosud

Published 10 May 2018

Scotiabank’s Peruvian subsidiary Scotiabank Peru has agreed to acquire a 51% controlling stake in Banco Cencosud, which offers credit cards and consumer loans in Peru, for approximately C$130m ($101m).

Under the terms of the agreement, the two companies will also enter into a 15-year partnership to manage the credit card business and provide additional products and services to customers. Scotiabank and Cencosud already have similar partnership arrangements in Chile and Colombia.

Scotiabank will become the second-largest credit card issuer in Peru following the closing of the transaction.  The terms of the transaction are not financially material to Scotiabank.  This agreement is subject to regulatory approval.

Cencosud is the second largest supermarket and fourth largest department store chain in Peru. Cencosud has operated in the country since 2007 under the Supermercados Wong, Supermercados Metro and Tiendas Paris brands, as well as shopping centres. Today, Banco Cencosud has more than 315,000 active clients and approximately C$240m ($187.9m) in outstanding loans in Peru.

Scotiabank International Banking Group Head Ignacio (Nacho) Deschamps said: "Building on our existing partnership with Cencosud enables us to increase Scotiabank's market share and presence in Peru and provides us with a larger base of customers to offer our leading financial products and services.

"This transaction also aligns to Scotiabank's broader international strategy to increase scale in the Pacific Alliance economies of Mexico, Peru, Chile and Colombia."

Scotiabank in Peru, country head and CEO Miguel Uccelli said: "Working together with Cencosud, Scotiabank will look to strengthen and build our credit card and consumer loan portfolio.

"Scotiabank Peru will leverage this increased partnership to build new customer relationships and drive organic growth in the Bank's retail portfolio."

Scotiabank in Peru and Latin America

Scotiabank established a presence in Peru in 1997.

Scotiabank increased its presence with the acquisition of Banco Wiese Sudameris and Banco Sudamericano in 2006, Banco del Trabajo in 2008 and Citibank's Commercial and Retail portfolio in 2015.

In 2008, Scotiabank entered the Pension Funds business with the acquisition of Profuturo. Scotiabank increased its client base to 1.8 million with a 50% acquisition of AFP Horizonte.

Today, Scotiabank's banking division in Peru has close to 10,500 employees, 310 branches, 975 ABMs across the country and 3.5 million retail, corporate, commercial and institutional customers.

Scotiabank operates in 11 countries across Latin American, with a primary focus on Mexico, Peru, Chile, and Colombia.

Source: Company Press Release