Latin America's Best Banks

Global Finance magazine published the “Best Emerging Market Banks in Latin America” for 2009 in its May issue. This is the sixteenth year the magazine has ranked the top banks in emerging markets.

These top-performing banks were selected based on the following factors:

• Growth in assets
• Profitability
• Strategic relationships
• Customer service
• Competitive pricing
• Innovative products

Releasing the list, Joseph Giarraputo, publisher of Global Finance said, “We are in a unusually challenging environment for banks and their customers. More than ever, customers are demanding superior competence from their banking partners. These are the banks best providing that competence.”

The following table shows the top banks for 22 countries in Latin America. If the bank is listed on the US markets, the ticker is included.

Country	Bank	Ticker
Argentina	Banco Macro	BMA
Barbados	FirstCaribbean International
Belize	Belize Bank
Bolivia	Banco de Credito de Bolivia
Brazil	Itau Unibanco	ITUB
Chile	Banco Santander Chile	SAN
Colombia	Bancolombia	CIB
Costa Rica	Scotiabank Costa Rica
Dominican Republic	Banco Popular Dominicano
Ecuador	Banco del Pichincha
El Salvador	Banco Agricola
Guatemala	Banco Agromercantil
Honduras	Banco Atlantida
Jamaica	Scotiabank Jamaica
Mexico	Banamex
Panama	Banco General
Paraguay	Interbanco
Peru	BBVA Banco Continental
Puerto Rico	Banco Santander Puerto Rico
Trinidad & Tobago	Republic Bank
Uruguay	Banco Santander Uruguay
Venezuela	BBVA Banco Provincial

Source: Global Finance Magazine

Banco Macro of Argentina (BMA) has more than tripled since the March lows. Currently it has a yield of 5.21%. Brazil-based Itau Unibanco (ITUB) was formed by the merger of Banco Itau Holding Financeira SA and Unibanco. Itau Unibanco is one of the largest private-sector banks in Brazil. Itau Unibanco is one of the few foreign banks that pay a small monthly dividend. ITUB competes with the other large private-sector bank, Banco Bradesco (BBD).

Banco Santander-Chile (SAN) operates a network of 477 branches countrywide. The current yield is 4.74%. Bancolombia SA’s (CIB) dividend yield is 3.13%. In addition to 717 branches in Colombia, the bank has operations in El Salvador, the United States, the Cayman Islands, the British Virgin Islands, Panama, Peru and Puerto Rico. Bancolombia is part of Grupo Bancolombia which has many entities in the financial sector in Colombia.

Scotiabank Jamaica and Scotiabank Costa Rica are subsidiaries of the Canadian bank Bank of Nova Scotia (BNS). BBVA Banco Continental & BBVA Banco Provincial are group companies of the Spanish banking giant Banco Bilbao Vizcaya Argentaria, S.A. (BBV) and Banco Santander Uruguay and Banco Santander Puerto Rico are subsidiaries of Spain-based Banco Santander group (STD). Banamex, a subsidiary of Citibank (C), is Mexico’s second largest bank with 1,233 branches.

Comments

[YoYoMama:]

From a dividend investing viewpoint, STD and BBV would be superior choices, as unlike many ADRs they pay quarterly (instead of 1x or 2x per year), and the yields are 12% and 7%, respectively.

Jun 12 08:45 AM

[GRAFFOL:]

You are missing Bnaco de Credito del Peru, Peru´s biggest, private and most important bank.

Jun 12 09:17 AM

[YoYoMama:]

Probably not a miss because it's privately held, and therefore not of use in an article regarding investing.


On Jun 12 09:17 AM GRAFFOL wrote:

> You are missing Bnaco de Credito del Peru, Peru´s biggest, private
> and most important bank.

Jun 12 10:16 AM

[Alan Young:]

Panama's BLX is also a contender in this class. The whole list is rather arbitrary in that it only names one bank from each country; Brazil's top 4-5 banks should probably be compared to the best of the rest.

But a more fundamental question: who needs to invest in banks at all, with the world's financial system still clouded by recent shocks (and possible aftershocks), pockets (at least) of excess leverage, and who-knows-what off-book risk exposure? I can see owning preferred shares— with less risk and 10-15% yield— but why common?

Jun 12 04:10 PM

[Investor La...:]

Yes, you are wrong not considering Banco de Crédito del Perú. It is a parent company of Banco de Crédito de Bolivia (already selected as Bolivia´s top). Both of them are owned by CREDICORP LTD (NYSE:BAP). BAP stock has managed a formidable recovery since the crack. Going down from $86 to $30, it now stands above $61.

Jun 14 01:40 PM

[NWA10000:]

What about FirstBank of Puerto Rico?

Jul 07 08:57 PM