BTG Pactual is a leading investment bank in Latin America with a focus in asset and wealth management. In 1983, Pactual was initially founded as a brokerage but has since developed extensively as a bank with a strong presence throughout Brazil since its acquisition of UBS Pactual, resulting in the formation of BTG Pactual. With the objective of adding and creating value for clients regionally and internationally, the bank has expanded into private equity, infrastructure, real estate and natural resources.
The European caught up with BTG Pactual Colombia’s CEO, Juan Rafael Pérez, to learn more about their contribution to Colombia’s economic climate.
Tell us how the current climate in the Colombian market influenced your strategy.
Juan Rafael Pérez: Colombia’s economy is one of the strongest in Latin America. It is characterised by sound macroeconomic indicators, high GDP per capita, significant infrastructure investment led by the national government, a growing middle class, important national and international companies operating in the country, amongst other factors that makes it attractive for investors. Although the economy has faced some recent challenges, it remains solid, boasting a positive economic performance.
As a regional investment bank, BTG Pactual has been determined to continue its presence in the strategic markets throughout Latin America. In this context and taking into consideration the positive outlook for Colombia’s economy, this strategy will enable us to keep growing our operation in the country.
How are you able to use your regional IBD experience within the local market?
JRP: We are a regional investment hub for our clients. In each country, we have a professional team with local knowledge and experience, local regulatory vehicles, plus the advantages of having a regional platform. This convergence allows us to offer tailored solutions to individual, corporate and institutional investors. Our networking capabilities and intimate knowledge of each jurisdiction increases the added value offered to clients who are looking to expand or invest in the region. A clear example of the benefits of this platform is the successful entry of Bovespa into the stock exchanges of Peru, Colombia, Chile and Mexico in 2016.
Other examples of our abilities to connect Latin American companies with international investors in M&A, is the acquisition of 50% of Viva Colombia by Irelandia Aviation or the acquisition of 100% of Digitex, one of the largest BPOs in Colombia, by The Carlyle Group.
Our regional experience in ECM has led us to close successful deals involving important international clients. For instance, the $429m IPO of Biotoscana, a leading Latin American specialty pharma company, is an example of when BTG Pactual acted as joint bookrunner. This was the largest healthcare IPO in Latin America since 2011 and the largest in the Americas in 2017.
What are you providing clients with that is new and innovative and will attract customers?
JRP: At BTG Pactual we are fully dedicated to our institutional, corporate and wealth management clients as well as their investment and financing needs. We have structured a competitive and sophisticated portfolio of products and services that fit the requirements of our clients in Colombia and within the region by using highly talented local teams and employing rigorous risk management.
We operate, in each market, as a fully-fledged investment bank, providing support to our clients in areas such as wealth management, asset management, investment banking and sales and trading.
In investment banking, this model has proven to be a defining advantage for important transactions including the Odinsa deal with Grupo Argos in Colombia. This transaction was innovative and different, in the sense that for the first time in over 20 years the buyer -Grupo Argos – acquired Odinsa by paying for more than 80% of the total amount, in shares. It required the involvement of different areas from the Bank of Colombia and the support of the regional platform, to deal with the complexities of the transaction in terms of distribution, structure and local regulatory approvals.
From the perspective of wealth management, we have bankers with strong technical and commercial skills that make our clients feel more like partners. We have a differentiated offer, based not only on a proper advisory, but also on a diversified portfolio, where alternative investments are one of its main components. We also offer highly specialised advice and banking services. Thus, we have developed a wealth planning area, a highly sought-after service that focuses, mainly, on patrimonial subjects, taxes and succession planning. Furthermore, our company provides a global service, leveraged from an offshore platform composed of wealth planning areas throughout Latin America and the world.
In asset management, we have created a trust service line that operates under the highest performance standards, to provide our clients with the vehicles that best suit their needs. Our local and international open architecture platform allows us to enhance our fund management offer with other available investment products.
In sales and trading, we have an equity desk and fixed income commodities and currencies desk that provides investors looking at asset classes within a regional context the possibility to trade through Latin America, using our platform.
Tell us about your investment values and how they are reflected in the services you provide.
JRP: At BTG Pactual, we invest in long-term relationships, and this is clearly reflected in our investment decisions. We leverage our local and international cross-functional teams with the preservation of capital as our consistent top priority, creating diverse long-term portfolios.
Our top priority is to fully understand our clients and their needs. This motivates us to identify their risk profile as the first step in any investment. Our philosophy has enabled us to reach a high level of assertiveness in dealing with each of our clients’ investment needs.
We have different specialised and multidisciplinary teams for each product, locally and regionally, providing competitive advantages and performances above market average, for example, our local fixed income funds have ranked first and second, consistently over the last 2 years.
With a strong team focused on Colombia, how have you faced competition in the industry?
JRP: BTG Pactual offers the best of both worlds: it is a locally reliable company with a strong team, formed by 300 professionals who are service-oriented and have outstanding technical knowledge; as well as a regional platform that provides the necessary support to boast global contacts and has the experience and tools to provide innovative solutions for our clients based on up-to-date market information.
At the core of this platform is our partnership model, designed to align long-term objectives and encourage the best talent to work with us. This results in innovation, creativity and long-term commitment to our clients and assets that differentiates us from the competition.
Do you have any plans for expansion in the near future?
JRP: BTG Pactual expects to continue its growth in Colombia. We are developing an organic growth strategy in core areas such as private banking, investment banking and sales and trading. We are currently focused on expanding our presence in Bogotá, while remaining true to our core business areas. Since the country represents a strategic market, we are always open to evaluate opportunities for inorganic growth in our areas of expertise.