Scotiabank Completes Purchases in Peru to Expand Latin American Presence

Scotiabank today announced that it has received regulatory approvals and completed the previously announced purchases of two Peruvian banks. Through these purchases, Scotiabank will invest Cdn$390 million (US$330 million) as announced December 5, 2005. Regulators in Canada and Peru have provided their approval.

“We are very pleased to have achieved this next step with the agreements that we have reached in Peru,” said Rick Waugh, Scotiabank President and CEO. “We are looking forward to moving ahead with the combination of the banks involved to establish ourselves firmly in the Peruvian market as the country’s third largest bank. This is another step forward in Scotiabank’s growth strategy in international, and particularly Latin American, markets.”

Through this investment, Scotiabank has purchased approximately 80 per cent of Banco Wiese Sudameris (BWS) from Italy’s Banca Intesa, and has also purchased 100 per cent of Banco Sudamericano (BSA), of which it is currently a 35 per cent shareholder. Over the next several months, these institutions will be combined to form the country’s third largest bank. Scotiabank will hold an approximate 80 per cent stake in the new bank with Banca Intesa retaining approximately 20 per cent.

Mr. Waugh reinforced the previously stated commitment to address the Aval, a government guarantee currently valued at about US$250 million established by the Government of Peru in favour of BWS, and Scotiabank’s intention that the new bank reach an agreement with the Peruvian government regarding all pending economic issues related to the 1999 restructuring of Banco Wiese.

“The transfer of BWS control to Scotiabank ahead of schedule is the result of the excellent dialogue and cooperation established by the Intesa and Scotiabank teams combined with the efficiency of the local authorities and regulators,” said Giovanni Boccolini, Head of International Subsidiary Banks, Banca Intesa. “BWS has been, and continues to be, a leading financial institution in the Peruvian market thanks to motivated and dedicated members of staff committed to high customer service standards. I am firmly convinced that this transaction is extremely beneficial for all stakeholders of BWS, clients, employees, the Peruvian economy and obviously the shareholders, including Banca Intesa, which maintains a 20 per cent interest in the Bank.”

This agreement continues a series of recent Latin American investments by Scotiabank, including Mexico, the Dominican Republic, Puerto Rico and El Salvador.

“BSA has always provided exceptional customer products and services to our customers,” said Roberto Calda, Chairman, Banco Sudamericano. “Not only can our customers look forward to benefiting from the best practices of both banks, but the new bank will have a reach right across the country.”

“Over the next several months, we will mark a new milestone in the history of our institution, which has roots and growth that are deeply intertwined with the economic development of Peru,” said Carlos Gonzalez Taboada, General Manager of Banco Wiese Sudameris. “Our lengthy experience and tradition of seeking to motivate Peruvians to be enterprising, and our intention of providing an exceptional work environment for our employees will be enhanced even more as the combination with BSA moves forward to form part of the Scotiabank Group. Scotiabank has an international scope that few banks can match, and its history and presence in Latin American markets will allow new specialized expertise to be incorporated into the ongoing operations of the new bank.”