Brazil's investment banks are engaged in their own distribution build-up a mini-version of the Morgan Stanley Dean Witter and Salomon Smith Barney megamergers in the US. Banco Bozano Simonsen has purchased the retail bank Meridional in a privatization auction and Banco Pactual has bought Sistema, a Sao Paulo commercial bank which ran into trouble. Both banks say they are looking to make further purchases.
"The origin of our strategy is that the investment banks were losing ground. What the mergers in the US show is that the banks with the clients will be the winners," says Luiz Cezar Fernandes, president of the Pactual partnership. In a comparison with Goldman Sachs, Fernandes says the focus of discussions at the US investment-banking partnership is whether to go into retail or to sell out. "At Pactual we have already decided on our strategy to go into retail," he says.
But the...
