A joint venture between UBS Group AG and Banco do Brazil SA predicts that trading volume for local corporate bonds in Brazil will increase by approximately 30% next year, and it is taking efforts to gain a larger share of that market. According to business insiders, UBS BB Investment Bank, which was formed a year ago by the two banks to focus on South America, is changing its internal processes to prepare for the projected surge. In an interview, Daniel Mendonca de Barros, head of UBS global markets for Latin America, stated that the business is now focusing on secondary-market trading as a potential growth sector. “Our partnership with BB brought visibility and relevance to our local debt capital-markets business,”.
According to Anbima, the country's capital-markets group, a 30% rise in debt trading volume would follow an 84 percent growth this year through Tuesday, reaching 229.9 billion reais ($49 billion). When UBS formed the joint venture with state-owned Banco do Brasil, Latin America's second-largest bank by assets, it was already the second-largest equities trader in the country. Since then, it has acquired market dominance in a variety of industries, including local corporate debt underwriting, a sector dominated by large local banks with the ability to store the bonds on their books.
By: Lucas Scala and Carolina Paixão
Edited by: Anna Kissajikian