Spanish Bank Buying 75 Percent Stake in Bankrupt Mexican Bank
Oct. 24, 1996
MEXICO CITY (AP) _ Spain's Banco Santander said Thursday it is raising $425 million to pour into Banco Mexicano, one of several banks driven into insolvency by the Mexican economic collapse of 1995.
The deal will give Banco Santander a 75 percent stake in Banco Mexicano, the country's fourth-largest bank with assets of $11 billion. It is the latest in a string of foreign purchases of Mexican banks as the country recovers from its financial crisis.
Mexico's government had picked up $2.3 billion of Banco Mexicano's past-due loans.
Banco Santander will take formal control of Banco Mexicano by the beginning of next year. Stock in Invermexico, Banco Mexicano's holding company, dropped in Mexico after news of the deal.
Banco Santander is Spain's largest financial group with $145 billion in assets and 4,200 international branches. The bank, which opened its first overseas office in Mexico in 1950, said the purchase is part of its attempts to become Mexico's most important foreign bank.