TEGUCIGALPA, Honduras--(BUSINESS WIRE)--Banco Ficohsa announced it has completed the purchase of Banco Citibank de Honduras, S.A and Cititarjetas de Honduras, S.A., after receiving the required regulatory approvals. The transaction does not include Banco de Honduras, S.A., which conducts Citi’s corporate banking business in Honduras.
The acquisition is the largest transaction of its kind undertaken by a Honduran bank. Ficohsa now becomes the largest bank in Honduras and one of the top 10 banks in Central America.
The deal included an US$ 80-million capital contribution, which brings Ficohsa’s total net worth to approximately US$ 350 million, which represents 21% of Honduras’ total financial system’s net worth. The contribution is comprised of tier 1 and tier 2 capital.
“We are pleased with the regulators’ decision and thank them for their vote of confidence. This is a very important step in our expansion and growth strategy,” said Camilo Atala, president of Grupo Financiero Ficohsa. Atala added, “This transaction, and the associated capital contribution, reaffirm our continued commitment to the development of the country.”
The combined entity will have a loan portfolio of US$2 billion, a deposit base of over US$1.6 billion and US$ 2.7 billion in assets, which represent 20% of the total assets of the Honduran financial system (using pro forma figures of the companies combined as of March 31, 2014.)
The acquisition strengthens Ficohsa’s service offering, which will become the most robust consumer banking portfolio in the country, while complementing its primary focus on the corporate segment. It will also strengthen its footprint, reaching 450 ATMs (the largest in Honduras) and 150 service points.
As a next step, Banco Ficohsa must submit a merger plan to the regulator, whose primary objective is to ensure a smooth transition for customers and employees of both institutions. The merger plan requires regulatory approval prior to its implementation.
The two entities will be fully merged once all assets are transferred. This is expected to take place during the first quarter of 2015. In the meantime, both entities will continue to operate independently with no change in current operations.
“Citi has been present in Honduras for almost 50 years and we are committed to the country,” said Reina Irene Mejía, Citi’s Country Officer in Honduras. “We are not leaving Honduras. Our strategy is to focus our operations on our Corporate Banking business to strengthen our position and continue offering top quality services in those areas where we can add the most value, backed by Citi’s unique global network.”
About Banco Ficohsa
Banco Ficohsa has over 20 years of active participation in the Honduran financial system. It is the largest bank in the country by assets and book value. Ficohsa’s partners include the World Bank, the International Finance Corporation, and the development funds of Holland (FMO) and Germany (DEG), which are minority shareholders. The bank has a large retail banking footprint across the national territory of Honduras. Ficohsa is also the first bank in Central America to receive a banking license to establish a representation office in Miami, and the first Honduran bank to establish a presence in Panama and Guatemala. For further reference, please visit www.ficohsa.hn
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