Colombian banks eye central America

Jason Mitchell
Published on:

With a high concentration of ownership in the Andean region, consolidation is difficult. Colombian banks’ response has been to direct their focus north.

Colombian banks are more likely to remain focused on expanding into central America than on creating regional banking groups in the Andes, according to experts.

During the past few years, Colombia’s main banks have expanded aggressively into central America. In July 2010, Grupo Aval, the country’s biggest bank holding group, which owns Banco de Bogotá, purchased 100% of BAC-Credomatic, a central American financial group, from GE Capital Global Banking for $1.9 billion.

In July this year, Grupo Aval acquired the Panama subsidiary of Spanish bank Banco Bilbao Vizcaya Argentaria for $490 million.

In February, HSBC agreed to sell its Panama subsidiary to Bancolombia for $2.1 billion. Last year, the London-headquartered bank sold its subsidiaries in Costa Rica, El Salvador and Honduras to Davivienda, another big Colombian bank, for $300 million.

All these deals helped the Colombian banks to become one of the main...