A month after Adolfo Lagos Espinosa was brought in as the new chief executive of Grupo Financiero Serfin, Mexico's third-largest and most troubled financial institution, he had a surprise call from the bank's chairman, Adrian Sada Gonzalez. Recalls Lagos: "He said somebody from HSBC had come to visit him and would I talk to them about a possible investment."
The highly regarded Mexican banker wasn't keen. Though only in his job for a few weeks, he had already put together the makings of an ambitious recapitalization by drawing on his associations with finance minister Guillermo Ortiz, a former college classmate, and JP Morgan's M&A chief, Roberto Mendoza. Mendoza knew him well from the 1992 privatization of Mexico's Grupo Financiero Bancomer, where Lagos's reputation was built.
Having convinced the government to take on an unprecedented $2.7 billion of Serfin's bad loans - one-third of its portfolio - and after persuading JP Morgan to make a $290 million bridge loan for immediate capital needs, Lagos decided to postpone finding a foreign partner until the bank's turnround was more assured.
As for HSBC Holdings, the London-based financial group whose major emerging market activity is in Asia, "I didn't even know who these guys were," he says.