BBVA wealth unit eyes LatAm, Asia growth

By Judy MacInnes

GENEVA (Reuters) - Spanish bank BBVA (BBVA.MC: Quote, Profile, Research, Stock Buzz) sees more growth in the future from its wealth management business in Latin America than from its home base in Spain, the bank's chief investment officer in charge of private banking said on Tuesday.

BBVA has a strong Latin America retail banking franchise, particularly in Brazil, Chile and in Mexico, where it owns the country's biggest bank Bancomer.

It markets its wealth management products through its network worldwide.

"Latin America has more growth potential for BBVA in high net worth individuals than Spain, as the economies in the region are growing," said Enrique Marazuela at Reuters Wealth Management Summit.

Since the second quarter of this year the Spanish economy has suffered a sharp slowdown in growth, in great part due to the steep downturn in the domestic real estate sector, which had driven a 10-year long economic bonanza.

Marazuela flagged the negative inflow of funds at BBVA's Spanish private banking division "due to the fact that property sales are not as high as they were over the last ten years. And we are not transferring any money to the property sector.

"What we have seen in Spain, however, is a flight to quality in terms of which banks Spanish clients choose to manage their money," Marazuela said, noting that clients are keen to avoid third party risks as well as investment risks.

BBVA, Spain's second largest bank, had 10.5 billion euros under management at its private banking division at end-June, compared to 11.4 billion at end-December.

ASIAN ATTRACTION

Marazuela said Asia is also another emerging market which could provide expansion opportunities for BBVA's private banking arm, offsetting slower growth in Spain.

BBVA is already present in China through its stake in Chinese banking group CITIC.

"The opportunities are not only in China but in Asia in general. There will be at least double-digit growth in private banking in the region in the coming years," said Marazuela.

But for the time being, BBVA is not involved in any project to set up a private banking venture in Asia.

While acknowledging that the shake-up in the global financial sector will provide land-grab opportunities in the private banking business, Marazuela said BBVA is not on the acquisition trail.

"I don't think BBVA is going to acquire new private banking assets," said Marazuela.  Continued...