Banco Pan’s unlikely transformation into a force in digital retail banking in Brazil began in 2010 with a $1.4 billion accounting fraud. The owner, Silvio Santos, a well-known media figure in Brazil, was forced to offload the bank (then called Banco Panamericano and specializing in car financing) to a partnership of state-owned Caixa Economica and investment bank BTG Pactual.
It seemed an odd move by BTG Pactual at the time, pre-dating by many years the bank’s decision to enter retail banking through a digital platform.
The bank was stabilized by the two new owners, but it wasn’t until the power of digital banking became evident that it was re-launched as Banco Pan – a full service digital bank targeting the lower socio-economic income groups.
Caixa has now divested and BTG Pactual runs the show, with 71.7% of Pan’s equity; the remainder is listed on the B3 exchange.
The combination of Pan and BTG Pactual Digital means that BTG now has a digital banking offering for all segments of Brazil’s retail banking market, in addition to its traditional corporate and investment banking and asset management businesses.
And Pan’s recent growth is impressive. In May this year it was reported to have had 2.3 million downloads of its app and now has 11.1 million active monthly users – one of the highest levels of engagement in the country. Led by chief executive Carlos Eduardo Guimarães, the bank isn’t just growing very rapidly (in the first quarter of 2021 it reported 378% growth in banking clients) it is doing so profitably. Pan’s adjusted return on equity in the first quarter was 20.3% – shedding just 3.2 percentage points during the Covid pandemic.
