Private Credit Lifts Brazil Lenders’ Investment-Banking Fortunes

Bloomberg11-12

(Bloomberg) -- A surge in private-credit funds and record local bond sales are helping Brazil’s biggest lenders snag investment-banking market share from US competitors. $Bank of America Corp(BAC-N)$....

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overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nPrivate Credit Lifts Brazil Lenders’ Investment-Banking Fortunes\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-11-12 19:30 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://finance.yahoo.com/news/private-credit-lifts-brazil-lenders-113000005.html><strong>Bloomberg</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>(Bloomberg) -- A surge in private-credit funds and record local bond sales are helping Brazil’s biggest lenders snag investment-banking market share from US competitors.\n$Bank of America Corp(BAC-N)$....</p>\n\n<a href=\"https://finance.yahoo.com/news/private-credit-lifts-brazil-lenders-113000005.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"LU0265266980.USD","symbol_name":"法巴巴西股票基金","start_time":0,"source_url":"https://finance.yahoo.com/news/private-credit-lifts-brazil-lenders-113000005.html","article_id":"2482994708","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/FWtN0Ln83KROYzozclrC5A--~B/aD03OTg7dz0xMjk2O2FwcGlkPXl0YWNoeW9u/https://media.zenfs.com/en/bloomberg_markets_842/ee695206e7902c1edaeb39a7752693b0"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2482994708","pubTimestamp":1731411000,"columns":[],"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":" -- A surge in private-credit funds and record local bond sales are helping Brazil’s biggest lenders snag investment-banking market share from US competitors.Bank of America Corp.’s ranking for the business slipped to third this year from second in 2023, as the bank ceded ground to local heavyweights Itau Unibanco Holding SA and Banco BTG Pactual SA, according to Dealogic data through Oct. 31. JPMorgan Chase & Co., the biggest US bank, also lost market share.Still, the total investment-banking fee pool fell to $591 million this year through Oct. 31, down 6.1% from the same period last year, according to Dealogic. A weaker year for equity issuance was to blame, as volume dropped 18% from the same period last year, to 30.8 billion reais, according to data compiled by Bloomberg.Local corporate bond issuance increased 88% to a record 378.7 billion reais  this year through Nov. 7, according to data compiled by Bloomberg.“On the other hand — like any market that is generating money — you att","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"LU0265266980.USD":"法巴巴西股票基金","ITUB":"艾涛巴西联合银行","LU0543330566.HKD":"TEMPLETON BRIC \"A\" (HKD) ACC","LU0532187761.SGD":"JPMorgan Funds - Brazil Equity A (acc) SGD","LU0128526570.USD":"TEMPLETON LATIN AMERICA \"A\" ACC","LU0229945570.USD":"TEMPLETON BRIC \"A\" (USD) ACC","LU0788109048.HKD":"BGF LATIN AMERICAN \"A2\" (HKDHGD) ACC","LU0449515922.USD":"HSBC GIF GLOBAL EMERGING MARKETS EQUITY \"PC\" (USD)ACC","IE00B1B80R65.USD":"柏瑞拉丁美洲股票A","BBD":"巴西布拉德斯科银行","LU0320763518.SGD":"FTIF - Templeton Latin America A Acc SGD","LU0029865408.USD":"TEMPLETON LATIN AMERICA \"A\" INC","LU0072463663.USD":"Blackrock Latin American A2 USD","BK4207":"综合性银行","LU0054450605.USD":"HSBC GIF GLOBAL EMERGING MARKTS EQ \"AD\" INC","BBDO":"布拉德斯科银行","LU0572108347.SGD":"Blackrock Latin American A2 SGD-H"},"translate_title":"私人信贷提升了巴西银行的投资银行业财富","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"BBDO":0.9,"BBD":0.9,"ITUB":0.9},"content_text":"(Bloomberg) -- A surge in private-credit funds and record local bond sales are helping Brazil’s biggest lenders snag investment-banking market share from US competitors.\n$Bank of America Corp(BAC-N)$.’s ranking for the business slipped to third this year from second in 2023, as the bank ceded ground to local heavyweights Itau Unibanco Holding SA and Banco BTG Pactual SA, according to Dealogic data through Oct. 31. JPMorgan Chase & Co., the biggest US bank, also lost market share.\nThe success of local banks stems partly from their relationships with the nation’s retail clients, who have been buying more local Brazilian bonds because of their higher interest rates and, in some cases, their tax-exempt status. US banks don’t have a retail presence in Brazil. \n“The Brazilian banks, which have a stronger local balance sheet, have more appetite to buy local bonds and keep them on their books if needed, selling them in the future,” said Felipe Thut, head of fixed income and structured products at Osasco-based Banco Bradesco BBI, whose market share rose to 7.1% this year from 5.6% in 2023. “So they can provide companies full underwriting, a practice that has been gaining importance in Brazil since 2018.”\nStill, the total investment-banking fee pool fell to $591 million this year through Oct. 31, down 6.1% from the same period last year, according to Dealogic. A weaker year for equity issuance was to blame, as volume dropped 18% from the same period last year, to 30.8 billion reais, according to data compiled by Bloomberg.\nItau’s revenue from brokerage fees and financial and economic advisory work surged 51% in the first nine months of 2024, according to its earning statements, while BTG said its investment-banking revenue more than doubled in the first half.\nDemand for private credit has been growing as Brazil’s monetary policy diverges from much of the rest of the world, with benchmark interest rates rising in the nation as they fall in many other major economies. Tax changes and the poor performance of hedge and equity funds also encouraged investors to shift into fixed-income alternatives. \nLocal corporate bond issuance increased 88% to a record 378.7 billion reais ($66.7 billion) this year through Nov. 7, according to data compiled by Bloomberg.\nCompanies are taking the opportunity to sell debt with credit spreads at record lows, according to Cristiano Guimaraes, head of corporate and investment banking at Itau, the No. 1 local bond underwriter, the data show. The lender’s share of Brazil’s total investment-banking pool rose to 14.7% from 12.4%, according to Dealogic, putting it at the top of the ranking.\nThe local market has been maturing, with more transactions such as structured deals sold to retail customers, which generate higher investment-banking fees than plain-vanilla bonds offered to institutional investors, Guimaraes said.\n“On the other hand — like any market that is generating money — you attract new competitors, and for them to enter the market they charge less,” he said.\nBank of America acknowledged that it has only a limited presence in Brazil’s local bond market. But the bank’s franchise has an “outstanding position in strategic products such as mergers and acquisition advisory, equity and global bonds underwriting,” said Hans Lin, co-head of Brazil investment banking. \nDeal volume in M&A is running at a much higher pace than last year as many international strategic investors with a longer-term view are seizing the opportunity to buy companies given the weaker real, Lin said.\nDeals in which Brazilian firms were the target climbed 62% to $35.9 billion this year through Oct. 18, compared with the same period last year, Dealogic said.\nBruno Saraiva, co-head of investment banking in Brazil for Bank of America, added that “there are a number of M&A transactions that are being closed now that we expect will generate significant revenue next year.”\nBofA has been trading places with Itau at the top of the revenue rankings in recent years, and BTG has always had a strong presence in the market. The US banks performed better in 2018 and 2021, when many Brazilian companies went public on US stock markets and completed additional offerings paying fees as high as 6.5% of the total deal value. \nBanco Bradesco SA’s revenue from capital markets and financial advisory jumped 27% in the first nine months of the year, according to its financial statements, and the bank rose to No. 5 from No. 7 on Dealogic’s ranking.\nInvestment-banking revenue reached 1.2 billion reais at BTG in the first half of the year, according to its financial statements, while Bradesco’s revenue from financial advisory and capital markets was 1.16 billion reais in the three first quarters of the year.\nBond issuance has been so strong that Bradesco hired 12 investment bankers this year to originate deals and six people to distribute it, Bradesco’s Thut said, forming a team of 55 people. The bank also decided for the first time to name a director specifically in charge of fixed income, with Thut given the role. The M&A advisory and equity-underwriting business is now being led by Andre Moor. \n“The local bond market tripled since 2018 and all the big local banks are focusing more and more on it,” Thut said, adding that he expects growth to continue next year as rates in Brazil continue to rise. “But the pace of the market’s increase in 2025 should be smaller.”\n©2024 Bloomberg L.P.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2482994708"}