UPDATE 1-Santander Brasil taps Rial as CEO in bid to boost profits
(Changes dateline, adds background throughout)
SAO PAULO, Sept 9 (Reuters) - Banco Santander Brasil SA named on Wednesday Chairman Sérgio Rial as chief executive officer, as the nation's third-largest private-sector lender moves toward regaining ground lost to homegrown competitors in recent years.
As part of a succession plan that had been already put in place, Rial will replace Jesús Zabalza at the helm of Santander Brasil, the local subsidiary of Spain's Banco Santander SA , according to a securities filing. Zabalza will in turn preside over Santander Brasil's board, the filing said.
Rial, a former dealmaker at Bear Stearns Cos and ABN Amro Bank NV, joined Santander Brasil as chairman in February to help spearhead a turnaround at a firm that had long underperformed rivals. Rial left meatpacker Marfrig SA, where he helped cut debt and sell assets, at the start of the year.
His appointment comes at a time when Brazilian banks are facing the most challenging business outlook in recent history: the economy is contracting at the fastest pace in at least 25 years, and rising inflation, borrowing costs and unemployment rates are weighing down the ability of households and companies alike to service their debts.
Financial companies are also braced for a wave of tax hikes as the government seeks to narrow a swelling budget deficit.
Santander Brasil has the lowest profitability indicators and smallest loan book among Brazil's top-four listed commercial banks.
Zabalza's efforts to help Santander Brasil expand faster in card processing, financial services and lending to mid-sized companies indeed helped bolster profits, although at a slower pace than required, analysts said.
Units of Santander Brasil, a blend of the bank's common and preferred shares, are up 8.3 percent this year, the result of a partial buyout plan executed by parent company Banco Santander.
Rial's appointment was first reported by newspaper O Estado de S. Paulo's online edition late on Tuesday. (Reporting by Guillermo Parra-Bernal; Additional reporting by Stephen Eisenhammer in Rio de Janeiro; Editing by W Simon)
© Thomson Reuters 2016 All rights reserved.