As the great and the good of Latin America’s financial community gather this month in Cancún for this year’s Inter-American Development Bank meeting, they could be forgiven for engaging in a bit of mutual back-slapping.
Along with Asia, Latin America is the region that has emerged in the best shape from the financial crisis, with Brazil the star performer.
The region’s development is reflected in the fierce battle among investment banks to win business there not just in the public markets but also in other areas, such as credit, commodities, infrastructure finance and foreign exchange.
It’s a sign of how far Latin America has come that investment banks now seek the same kind of business mix in the region as they do in the US and Europe. Revenues from international deals in the public markets account for only a quarter of what banks make in Latin America. Instead the vast majority of the top line comes from sales, trading and local market deals. Investment in technology as much as people will determine which banks stay ahead of the pack.
Many of the region’s bankers believe that the biggest opportunity lies in local credit markets.