The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.

Banking: Central America moves out of financial backwater

As HSBC buys Banistmo for $1.8bln, analysts predict that the region is ripe for consolidation.

HSBC’s $1.77 billion purchase of Banistmo, central America’s leading banking group, has cast a bright light on a region that for decades was considered a financial backwater. A free-trade agreement with the US, almost $10 billion in annual remittance flows and a move away from coffee towards more sophisticated exports means central America is now one of the richest pickings in Latin America for banking acquisitions.

That has also been underscored by Scotiabank’s move into El Salvador and Costa Rica this year. “We believe acquisitions in central America are first on Scotiabank’s radar screen,” says Andre-Philippe Hardy of Merrill Lynch.

HSBC’s acquisition of Banistmo will give it a presence in five central American nations, as well as Colombia. Its portfolio will include El Salvador’s financial conglomerate, IFB; Costa Rica’s Corporación Banex; and Honduras’s top bank, Banco Grupo el Ahorro (BGA), as well as insurance businesses in several countries. The deal clearly strengthens HSBC’s position in Latin America but leaves it without a presence in Guatemala, central America’s largest economy, which has a banking system that is wide open to consolidation. Guatemala has 24 banks, down from more than 30 in 2000, in a poor country of 12 million people.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.


Unlimited access to and

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually


Unlimited access to and, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors


Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree