LatinFinance - November/December 2013 - 44

most ambitious growth effort in Mexico to
date, Martínez says.
It increased branches by 6%, ATMs by
almost 7%, and added 740,000 new clients
in the year to June 2013.
Shrewd risk management and strict
procedures for tracking and evaluating
lending quality kept its credit portfolio
healthy over the same period, when it
achieved a non-performing loan ratio of
2.4%, and a capital adequacy ratio of 15.2%.
The bank made profits of 17 billion pesos
in 2012, a 31.4% increase over the previous
year, and had an ROAE of around 18.5% at
the end of the first half of 2013, while greatly
advancing its market share in areas like SME
loans.
Santander México has become
increasingly important to the global
Santander group: in 2012 it was the fourth
largest contributor to profits with 12% of the
total, by June 2013 it was third, with 13%.
An ambitious retail strategy enabled it
to bolster its offering in certain segments
that are also the most crucial to the Mexican
market while maintaining a healthy
portfolio and the best efficiency indicators
in the industry, Martínez says. LF

SANTANDER MÉXICO
HAS BECOME INCREASINGLY IMPORTANT
TO THE GLOBAL
SANTANDER GROUP:
IN 2012 IT WAS THE
FOURTH LARGEST
CONTRIBUTOR TO
PROFITS WITH 12% OF
THE TOTAL, BY JUNE
2013 IT WAS THIRD,
WITH 13%
44 LATINFINANCE.COM - November/December 2013

INVESTMENT BANK OF THE YEAR
MEXICO

BBVA Bancomer
BBVA Bancomer is playing a
prominent part in Mexico's
booming primary capital
markets
Mexico's economy may not have lived up
to the hype when Enrique Peña Nieto took
office a year ago. But its capital markets so
far have beaten expectations.
A steady run of mergers, acquisitions,
bond sales and equity issues have kept
investment banks busy. Among them, BBVA
Bancomer has stood out as the bank that
has demonstrated the most impressive
performance across all areas of capital
markets for Mexican clients.
In equity markets, its resumé is
impressive, including the country's
largest-ever IPO - Santander Mexico's
$4.1 billion deal in September 2012 - and
Infraestructura Energética Nova (IENova)'s
well-bid 7.4 billion peso transaction in
March.
It has worked on a number of innovative
bond transactions, including two that
have won accolades from LatinFinance
over the past year: it was bookrunner on
América Móvil's groundbreaking 15 billion
peso global bond in November 2012 and
on a europeso project bond for Red de
Carreteras de Occidente.
In infrastructure financing, the bank
came in on a $3.1 billion project financing
for petrochemicals plant Etileno XXI
and managed the sale of project bonds
for wind farms Oaxaca II and IV, which is
LatinFinance's 2013 Best Renewable Energy
Financing deal.
Opportunities remain
Many analysts have cut their expectations
for Mexico's economic growth this year.
Yet BBVA Bancomer still sees ample
opportunity for investment banking and
capital markets in a stable economy with
low inflation.
International investors see value in
Mexican corporate and quasi-sovereigns,
and there has been a "tremendous amount
of activity" in the international debt
capital markets, says Adrián Otero, head of
corporate & investment banking at BBVA

Bancomer. He points to corporate deals,
including FEMSA, which raised $1 billion in
its first international deal in 14 years, and
Office Depot de México, which debuted
in the international market with a $350
million 2020 non-call four-year bond.
Otero sees keen growth too in the equity
capital markets and expects a flurry of deals
before the end of the year.
"We are working hard on two or three
new names for IPOs in 2014," says Otero.
But whether these companies make it
to market will depend on the economic
situation at the time of the offering.
Private equity firms are interested in
opportunities in Mexico, as are foreign
companies looking to enter the market
through mergers and acquisitions,
especially of energy and consumer firms,
Otero says. Meanwhile, Mexican companies
are starting to look at European acquisition
targets. While América Móvil's bid for Dutch
telecom KPN was called off in October,
the initial bid nonetheless was indicative
of the global opportunities for Mexican
companies.
Still, the first half of 2013 was not good
for syndicated loans. Most companies
preferred to issue debt at the ultra-low
spreads on offer at the time than to borrow
from banks.
One of BBVA's main goals is to further
develop the local debt market. Otero
expects new names, specifically mediumsized enterprises, to emerge. "We can
expect three to four new issuers in 2014,"
he says.
He remains upbeat on the ambitious
economic reform agenda being pushed by
ADRIÁN OTERO, BBVA BANCOMER

"IMPLEMENTATION
OF REFORMS WILL
BE ONE OF THE BIG
THINGS THAT WILL
CHARACTERIZE
MEXICO'S PROSPECTS
- AND HOPEFULLY
TRANSLATE TO NEW
BUSINESS SPECIFICALLY IN THE ENERGY
AND INFRASTRUCTURE SPACE"
http://www.LATINFINANCE.COM
LatinFinance - November/December 2013

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