Scotiabank is looking to expand in the Latin America region, particularly Mexico. According to the Wall Street Journal, the expansion is seen amidst the decline of larger financial institutions in the region.

Scotiabank, Canada's third-largest bank, has taken the risk of opening their services in Mexico with several strategies in order to keep the business expanding. By offering various products to its customers, the possibility of gaining the people's trust will also increase.

 

Dieter Jentsch of Scotiabank said as quoted by the publication, "We know that if we're you're number one bank, we'll get paid back first."

This is not the first time Scotiabank will extend business in the Latin America region. Currently, Scotiabank's earnings are largely contributed by their international operations from the regions. Most of their income came from Mexico, Colombia, Peru and Chile.

CTVNews reports that Scotiabank's growing presence in Mexico will coincide with the projected increasing number of middle class in the region. The Pacific Alliance, which is also composed of the four countries mentioned, has a significant trade agreement with each other where Scotiabank revealed that only 40 percent of their population have bank accounts.

The low number is seen by the bank as a good sign of growth and expansion within the region. If the planned opening pushes through, Jentsch sees an increase on annual earnings by at least 9 to 11 percent within the next three years of opening.

As per Winnipeg Free Press, Scotiabank CEO Brian Porter admitted that while the company originally hails from the Caribbean and has since started their expansion in the same region, they see the Pacific Alliance as their major market.

He also added as quoted by the outlet, "The macro fundamentals and demographics are very compelling. For instance, young and rapidly growing underbanked populations in each of these countries have an increasing need for financial services."

Scotiabank has also started the process of extending their services in Mexico by shedding around $180 million for their technological advancement. This primary move by the bank will cover at least three more years of preparation prior to its operation.

Among the Pacific Alliance, Mexico puts Scotiabank on the seventh spot when it comes to loans and other financial services. That spot has brought the bank at least 5.5 percent of Mexico's market, something that they want to improve to eventually become the region's number one bank.

Brian Porter, Chief Executive of Scotiabank said, "Mexico is a great place to invest and we're happy that we're here," per the Wall Street Journal.