UBS dithers as Brazil booms
The Swiss bank needs to make a real commitment to the key Latin market, or give up the ghost.
UBS has had a bad year. The bank’s financial situation deteriorated to such an extent that it had to undertake a shotgun sale of its profitable Brazilian unit, Banco Pactual. The sale to Andre Esteves, a former Pactual partner, was priced at $2.4 billion in April. Market experts suggest the business is now worth more than $5 billion.
Now UBS is tentatively investing in the region once again. That’s not a surprise given the potential flow of business there. By the end of the year more than $20 billion will have been raised in Brazil’s equity markets, for example, and judging by its past performance UBS Pactual would have gained the lion’s share of the fee pool.
UBS is sending out clear messages that the region is still very much on its agenda through a series of hires and new appointments. Mark Tuttle, the JPMorgan veteran, was hired last month to head debt capital markets for Latin America at UBS. He replaces Marcelo Delmar, who left for BNP Paribas over the summer.
UBS also named Gerard Cremoux and Jorge Silberstein as the co-heads of Latin America investment banking. Both will be based in Mexico.