The sale of Banamex by the American Citigroup, announced on Tuesday, would change the map of the Mexican financial system, if any of the institutions that make up the so-called group of the seven largest (G7), were to stay with this franchise.
Although the process, as has been said, would take months to materialize, specialists have already considered some names, including financial groups such as Banorte, Santander, HSBC, Inbursa and Scotiabank.
None of these has made a statement in this regard, however, economic study areas of institutions such as BofA Securities and Credit Suisse have pointed to these as potential buyers. In the case of BBVA, although its directors have said on other occasions that they would be interested in continuing its growth in the country, specialists see it as more difficult due to a concentration issue.
“Although (Citibanamex) has been losing market share in recent years, we believe that the franchise could attract the interest of many potential interested parties with operations in Mexico, including Banorte, Santander, Scotiabank and Inbursa, who could see this as an opportunity. unique to cement its position among the market leaders”, mentions an analysis by BofA Securities.
This institution estimates that the Citibanamex franchise could have a value of between 12,500 and 15,500 million dollars.
Credit Suisse agrees that given the current market structure, most of the G7 banks would be potential contenders for Banamex’s assets.
Both institutions see it as more complicated that BBVA could buy Banamex, given that today it already has a quarter of the market.
“The concentration would appear more moderate with a possible acquisition of Banorte or Santander, with higher market shares after the transaction, but still below or largely in line with BBVA’s independent market shares,” says Credit Suisse.
“The concentration would seem even less worrisome in the case of an acquisition by HSBC or Inbursa.”
so it would be
Today, according to the most recent information from the National Banking and Securities Commission (CNBV), as of September 2021, Grupo Financiero BBVA leads the market with 2.8 trillion pesos in assets, representing 24.5% of the total.
This is followed by Grupo Financiero Banorte with 1.8 billion pesos and 15.8% of the total; Santander with 1.6 billion and 14.6%; Banamex with 1.5 billion and 13.5%; HSBC with 741,360 million and 6.5%; Scotiabank with 643,494 million and 5.6%, and Inbursa with 563,723 million pesos and represent 4.9% of the total.
The financial groups Banorte and Santander are the ones that would fight the hardest in the Top 10 of the system if they took over Banamex’s assets.
If Banorte bought Banamex, its assets would add up to 3.3 billion pesos, almost 30% of the system’s total. In this case, BBVA would be in second place.
If it were Santander that acquired the Citi franchise, it would add 3.2 billion pesos in assets, 28% of the total. Here too BBVA would be in second place.
And in the event that HSBC were the buyer, its assets would add up to 2.2 billion pesos, 20% of the total; with Scotiabank it would reach 2.1 billion and 19%; and with Inbursa the 2.1 billion, 18.4% of the total.
Banco Azteca raises its hand
The person who has already expressed interest in buying Banamex is businessman Ricardo Salinas Pliego, owner of Banco Azteca, who asked that the possibility be analyzed.
This bank was in ninth place in the multiple banking sector, with assets of 255.5 billion pesos, 2.18% of the total. In case of acquiring the Citibanamex franchise, it would be around 1.8 billion in assets and 15.6% of the total.
They also see interest from other global entities
The Bank of America report estimates that there may also be interest from other international banks, which could see the sale of Banamex as a unique opportunity to enter the attractive Mexican market with considerable scale.
“Although we expect the appetite of Brazilian banks to be lukewarm, given their relatively limited international experience and lack of cross-border synergies in retail banking,” the document reads.
While Credit Suisse says that given the importance of the asset and the opportunity to potentially take control of one of Mexico’s largest retail operations, it would not be surprising to see Brazil’s Itaú Unibanco as a potential competitor, and perhaps even Bradesco. .
“However, we believe that banks already operating in Mexico have a much better chance considering the significant opportunities for cost synergies, not to mention the higher income tax regime of Brazilian banks,” he says.