BBVA signals retreat from Latin American pensions businesses
ONE of Spain’s largest lenders, BBVA, has announced plans to offload its South American pensions business in the latest sign of European banks’ retreat from foreign markets.
BBVA said it “has decided to initiate strategic review” of two businesses, one that operates in Chile, Peru and Colombia and another targeting just Mexico.
The bank said that it will be seeking buyers and if it does not find any, will simply close the businesses.
“Despite this being a highly attractive business, its limited relationship with BBVA’s core business, the universal banking activity, advises the initiation of this process,” the bank said.
It said the process would take “several quarters” and will not be completed by the end of this year.
BBVA also said that it will otherwise continue to expand in insurance and banking in Latin America.
The move highlights how western European lenders are being forced to ditch profitable enterprises as they overhaul their business models.
Rather than pursuing the unbridled expansion seen before the 2008 crisis, banks are shutting down and selling dozens of operations outside their home markets often because new regulations make them non-viable but also because they can make the overall group too unwieldy and unfocused.