MercoPress. South Atlantic News Agency

Bank of America expands in Brazil with new commercial license

Bank of America Corp. is expanding in Brazil with a new commercial banking license that will allow it to take deposits and offer cash-management services to corporate clients in the country.

The license will give the largest US bank a competitive edge in one of the world's fastest-growing economies and financial markets. Brazilian issuers sold a record 290.7 billion Real (180 billion USD) in stocks and fixed-income instruments in 2010, compared with 107.2 billion Real the previous year, according to investment-banking association Anbima.

The license will also permit the Charlotte, North Carolina-based bank to manage customers' day-to-day cash needs.

Brazil's economy, which has experienced boom-and-bust cycles of inflation, currency devaluations and interest-rate swings since the end of military government in 1985 is back on track and growing sustainedly.

Latin America’s largest economy GDP expanded 7.5% last year, the most in two decades, compared with 2.8% in the U.S. and 1.3% in the U.K., according to the IMF. Unemployment is at record lows and credit at all- time highs.

“If we need to do a short-term bridge in Real to help one of our clients acquire another client, we will now be able to do that,” said Mauricio Tancredi, Bank of America head of corporate banking for Brazil.

In the past, Bank of America could only do that “through off-shore funding now we will have both alternatives. We will definitely be more competitive”.