Trabuco Says That HSBC Brazil Acquisition Was Worth “6 years Of Organic Growth”

Bradesco, one of the largest banks in Brazil, has had a productive last few years. Under the leadership of its famous CEO, Luiz Carlos Trabuco, the company has made an incredible turnaround. Much of this is attributable to the acquisition of HSBC Brazil, the largest acquisition in the history of Brazil. The deal has placed Bradesco in the dominant market position, and things are looking better than ever for the bank’s future.

Not willing to use the M-word

When taking a close look at Luiz Carlos Trabuco’s career in banking, what stands out is his tactic of creating absolute dominance in whatever market it is that he is competing in. Although Trabuco himself is loath to say it, he, like all good businessmen, actively seeks to create monopolies in the markets in which he is participating.

While the term monopoly has a negative ring to the ears of many North Americans, throughout Latin America, the history of monopolistic businesses is a bit more nuanced. Companies such as the United Fruit Company, International Telephone and Telegraph and Telmex have all been ruthless in their dealings and have left many losers in their wake. However, these companies have also brought civilization and jobs to areas that were little more than Hobbesian jungles, with citizens living in crushing poverty and most primitive conditions imaginable.

It is for this reason that when people throughout Brazil hear the term monopoly, it doesn’t have all negative connotations. Even so, Trabuco himself is careful not to state outright that it is his strategic goal to turn Bradesco into the undisputed private banking monopoly of Brazil. But Trabuco’s record largely speaks for itself.

Read more: Trabuco: Despite the uncertainties, investors believe in the country

A record of no-nonsense success

As a young executive with the bank, in 1992, Trabuco was assigned as the president of the firm’s financial planning division. The division had been struggling for years to turn a profit and represented only a tiny fraction of the bank’s total revenues. Trabuco had the reputation of being an efficient and capable manager. He was tapped in a last-ditch effort to reform the department, hopefully bringing it to a state of profitability before the bank would be forced to shut it down.

One of the first moves Trabuco made was to go to a completely non-egalitarian banking model on Throughout the history of Bradesco, the bank had clung to a model whereby all of the clients, no matter their value to the bank, were treated roughly equally. Someone with $1,000,000 on deposit stood in the same lines and talked to the same tellers as someone with only a few dollars in their checking account.

Luiz Carlos Trabuco, who was an enthusiastic student of the great banks of North America, immediately recognized the error of this system. He moved to create a tiered banking system, with the top-value clients receiving the bulk of the bank’s customer service resources. The new banking service, called Bradesco Prime, offered high-net-worth clients access to 24/7 personal banking, preventing them from having to stand in lines or deal with tellers who may be overburdened with other clients.

The top-end banking product also gave the best clients complementary items, such as free stays at five-star resorts or first-class airfare. The model proved to be a major success. By the time Trabuco left the position, Bradesco had cornered the high-net-worth banking market, adding tens of millions of dollars to Bradesco’s balance sheets and facilitating the creation of hundreds of millions in new loans according to

This is just one example of Trabuco’s sharp eye for eliminating inefficiencies and cornering markets in the process. All told, the many mini-monopolies he has created for the bank have been a boon to its bottom line.

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