Banco do Brasil, UBS launch new investment banking joint venture

UBS joins forces with Banco do Brasil to launch new investment banking JV.  Banco do Brasil (BB) said that a proposed investment banking joint venture (JV) in South America between its subsidiary BB-Banco de Investimento (BB-BI) and UBS is ready to begin operations.

The Brazilian bank said that definitive documents have been settled for the partnership to operate in investment banking and securities brokerage activities in the institutional segment across Brazil, Argentina, Paraguay, Chile, Uruguay, and Peru.

The transaction was closed after satisfying all the preceding conditions, which included receipt of regulatory approvals.

In September 2019, the parties had announced their intentions to form the joint venture by signing a non-binding memorandum of understanding (MOU). It was followed by an agreement last November.

The joint venture combines the relationship network of Banco do Brasil in Brazil and its distribution capacity to individuals, with the global distribution platform and expertise of Swiss investment bank UBS.

Through its subsidiary, Banco do Brasil is contributing corporate clients to the joint venture, while UBS has brought its investment bank operating platform in the region and institutional securities brokerage.
How the new investment banking JV is expected to help clients

Banco do Brasil stated: “With the launch of the partnership, BB’s corporate clients, in addition to the service and complete offering of corporate banking solutions, through the network of branches and specialized offices, now have UBS’s global reach platform, providing differentiated access to products and investment banking solutions and expansion of the offer of integrated solutions in these markets.”

UBS will have a stake of 50.01% in the new investment bank, while BB-Banco de Investimento will hold the remaining stake of 49.99%.

Both the parties will have three members to the board of directors of the new investment banking joint venture. The chairman of the new investment bank will be appointed by Banco do Brasil, while the Swiss banking group will appoint its vice chairman.