MercoPress. South Atlantic News Agency

Santander sells Colombia’s affiliate to a Chilean bank

The Spanish group needs the funds to counter European operations

Banco Santander SA said late Tuesday it has agreed to sell all of its units in Colombia, including Banco Santander Colombia, to Chilean CorpBanca as part of its efforts to collect fund to comply with European regulators.

In a filing to the Spanish stock market regulator, Santander said the sale values its operations in Colombia, which is not seen as a core market, at 1.225 billion dollars; Santander will fetch Euro 615 million in capital gains.

The operation will be subject to the approval of regulatory authorities in Chile and Colombia and the completion of the transaction is expected to take place in the first half of 2012.

In a separate press release, CorpBanca said it will hold a 95% interest of Banco Santander Colombia and its total investment will be funded with own resources and a new capital increase of about 450 million dollars.

Banco Santander Colombia has a 2.7% market share in loans and 4.7% in deposits as of Sept. 30.

CorpBanca is Chile fourth largest private bank in Chile, in terms of loans and deposits, with market shares of 7.5% and 7.2%, respectively.