In 2013, Corredores Asociados, one of Colombia’s leading brokerage and investment houses was acquired by Banco Davivienda, the third-largest bank in the country. As a result, and after a brief consolidation process, Davivienda Corredores was created in 2014. This transaction posed a huge challenge for the newly named company; not only was the brokerage industry in Colombia undergoing some of its most testing times, but the task of unifying, under a the umbrella of a large commercial bank, the expertise and know-how of a traditional investment bank seemed daunting. Today, four years later, this transformation has proved to be successful – Davivienda Corredores has maintained its status as one of Colombia’s leading brokerage and investment banking firms, while also delivering attractive and profitable investment opportunities to its clients and strong performance for its shareholders.
An unlikely couple
The history of the Corredores Asociados brand spans over 70-years of excellence within the financial services. Over this period, the company has changed and adapted to various market conditions in Latin America.
Now, as Davivienda Corredores, it reaches its over 129,000 customers through five branches in Colombia, plus a fully-owned brokerage house in Panama. It also holds over $7.5bn in managed assets and is considered a pioneer in the investment management industry in Colombia. The bank’s commercial network allows permanent contact with the main investors in the Colombian market, resulting in effective marketing and distribution. It also has a strong track record in Colombia’s capital market, acting as lead advisor in some of the most representative transactions in both the primary and secondary markets.
Banco Davivienda began operations in 1972 as a savings and loan corporation and is currently a leading full-service bank with particular strengths in retail and corporate banking. Davivienda is the third-largest financial institution in Colombia by assets with an 12.9% market share, the second-largest bank in Colombia in terms of total loan portfolio with a 11.9% market share and the third largest bank in terms of shareholders’ equity with a 5.5% market share (as of 31 December 2016). Davivienda has 8.2 million clients, 598 branches and 1,833 ATMs. It is the largest bank in mortgage loans, second-largest in consumer loans and the third-largest in commercial loans in Colombia. The Davivienda brand and its logo, ‘La Casita Roja’, are among the most widely recognised and respected brands in the country.
A clear strategy
With both players ready, the stage was set for a process that could draw upon the strengths of each institution, while unifying the differences that characterised each firm. Also, the sheer difference in size made the matter harder: How does a nimble, agile player like Corredores Asociados join forces with a more rigid, larger player such as Banco Daviviend without losing its spirit? How does the large commercial bank harness the know-how and character of an independent partnership without breaking them in the process? The answer has been a combination of three key drivers: respect for each player’s core strengths, focus on client needs and adoption of best practices from each other. This combination, pillared upon shared principles and ethics, laid out the ground-work for the design and execution of its strategy. As a result, Corredores Asociados put together a plan that built upon its knowledge of the financial markets, experienced management and highly skilled professionals, together with Banco Davivienda’s knowledge of network management, organisational and operational strengths.
The firm today
Davivienda Corredores has embraced the advantage of the economic and organisational gravitas brought by Banco Davivienda, enabling the firm to offer a comprehensive portfolio of investment products and an enhanced number of services and business opportunities to its clients. For example, in 2016 the firm participated in Colombia’s largest ever capital markets transaction in which it advised Brookfield in the four-stage process through which the acquisition of 99.9% of ISAGEN was achieved, for a record-breaking sum of $3.5bn. The process included an initial auction in which 57.1% stake was acquired, two mandatory and one voluntary tender. Additionally, the firm has accomplished outstanding results in its existing mutual funds during 2017, with a growth of 36% in AUM in the first nine months of the year, and being within the top three ranking in profitability in 75% of its mutual funds. Moreover, it recently launched an innovative Real Estate Investment Fund which offers a new asset class to its wider client base.
Davivienda Corredores remains fully committed to its customers and is constantly searching for the most suitable investment opportunities to offer them, traits that have certainly been essential to be awarded the ‘Investment Management and Capital Markets Company of The Year’ by The European.