SAO PAULO, Aug 29 (Reuters) - Brazil’s Itaú Unibanco Holding SA is considering launching online-only bank accounts in Argentina, an executive told Reuters, as it looks for ways to grow in a country where distrust of banks is high and many do not own accounts.
Eduardo Vassimon, Chief Executive Officer at Itaú BBA SA, which looks after business outside Brazil, confirmed this week that the bank was considering offering the accounts in a bid to ramp up customer growth without spending on building a large branch network or acquiring rivals.
Itaú has been in Argentina for over two decades, but ranks just 17th in assets, with 800,000 accounts and 76 branches.
“In Argentina, Itaú is clearly behind the size we could have in retail banking,” Vassimon said.
Itaú’s plan to enter Argentina’s online banking arena underscores how the bank is shifting its strategy to grow in the region from bricks and mortar to asset-light, while it digests its largest acquisition outside Brazil, the Chilean bank CorpBanca in 2014.
After a number of economic and foreign exchange crises in recent decades, few citizens in Argentina use banking services. Half of the population does not have an account, according to the World Bank.
While widely applauded by foreign investors, Argentine President Mauricio Macri’s administration has had to slash once-rosy economic growth forecasts after a run on the peso forced the Argentine Central Bank to hike its benchmark interest rate to 45 percent.
“Argentina still poses some relevant macroeconomic challenges, but it offers great potential, particularly considering the country’s low banking penetration,” Vassimon said.
An online-only strategy would put Itaú, the dominant player in its home market, in the unusual position of upstart, jousting with startups like Uala, a mobile bank backed by billionaire George Soros and other investors.
It would also be taking on Banco Santander Río, Argentina’s second-largest bank by assets, which in June also unveiled plans to launch next year a digital bank aimed at those who do not use banking services.
Both Uala and another Argentine online bank, Wanap, have said they will offer below market fees and interest rates. Vassimon said Itaú has yet to decide what kind of fees it would charge in digital-only accounts.
Currently, the bank has retail operations in Argentina, Chile, Paraguay, Uruguay, Colombia and Panama. (Reporting by Carolina Mandl; Additional reporting by Luc Cohen in Buenos Aires, Editing by Rosalba O’Brien)