Tuesday, August 15, 2006

Scotiabank Plans to Expand Latin America Transfer Business

Bloomberg, 15 August 2006

Bank of Nova Scotia, Canada's third-largest bank, may expand its wire transfer business in Latin America to compete with lenders such as Wells Fargo & Co., a bank executive said.

The Toronto-based bank, known as Scotiabank, is targeting countries including Mexico, Peru and the Dominican Republic, said Peter Cardinal, executive vice president for Latin America.

``We will grow in the remittances business, probably by opening more branches,'' Cardinal said in a television interview from Toronto.

In 2005, Mexico, Peru, Dominican Republic and El Salvador received $28 billion in remittances, mainly from immigrants in the U.S., according to the Inter-American Development Bank.

Scotiabank will compete with money-transfer companies such as Western Union, a unit of First Data Corp., or MoneyGram International Inc. Banks including Wells Fargo and Spain's Banco Bilbao Vizcaya Argentaria SA are also offering transfer services between the U.S. and Latin America.

Scotiabank owns Grupo Scotiabank, the sixth-largest bank in Mexico. The lender also completed the purchase of two banks in Peru in March to create the third-biggest bank in that country. Scotiabank expects to generate about 27 percent of its 2006 net income from operations outside Canada, Cardinal said.