Banco do Brasil, Mapfre form insurance JV

Sao Paulo, May 6 (EFE).- Insurer BB Seguros, a subsidiary of state-owned Banco do Brasil, said it is entering into a 20-year strategic alliance with Spanish insurance giant Mapfre SA in the individual, property and casualty and auto insurance segments.

The terms of the deal will be defined in a period of 60 days and leave BB Seguros with a minority voting stake in two new private holding companies, the firm's president, Aldemir Bendine, told a press conference.

Mapfre's CEO, Jose Manuel Martinez, said Banco do Brasil is the "ideal partner" for the company's expansion plans in the giant Latin American nation, while Bendine noted that the joint venture with Mapfre in Brazil could serve as a model for other alliances elsewhere in Latin America, as well as in Africa, the United States and Japan.

The restructuring is part of Banco do Brasil's plans to internationalize its operations, Bendine said, adding that the idea is for the institution to become a "global bank."

Banco do Brasil says the companies emerging from the tie-up with Mapfre will have a leadership position in Brazil in the segments of personal insurance, with 20 percent of the market; diverse risk, 13.9 percent; and auto insurance, 15.1 percent.

"We want a market share that corresponds to Banco do Brasil's size," Bendine said.

Banco do Brasil is the country's largest financial institution, booking net income of 10.15 billion reais ($5.57 billion) last year, up 15.2 percent from 2008.

Mapfre, Spain's largest insurance company, expects its foreign units, especially those in the Americas, to serve as engines for growth, generating 60 percent of revenues and 40 percent of profits by the first half of 2011, the insurer's general manager, Esteban Tejera, told Efe earlier this year. EFE

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