Banco Bradesco, Brazil’s second-biggest bank by market value, is partnering with the Miami-based fintech BCP Global to offer digital investments to upper-middle-class and rich Brazilians.
Under the agreement, Bradesco’s customers gain access to global portfolios designed and managed in partnership with BlackRock, according to Leandro Miranda, an executive director at Bradesco. Those with at least $10,000 can open an investment account in the U.S. in about 15 minutes, Miranda said in an interview.
“Bradesco has about 2 million affluent clients with more than 100,000 reais [$18,000] invested with us, so we see huge potential for the new service,” said Ricardo Lanfranchi, chief executive and president of Bradesco Global Advisors, the bank’s registered investment advisor arm in the U.S. “Our unique tax benefits will also bring more clients to the bank in search of the product.”
The appetite for dollar assets from mom and pop investors in Brazil is growing. Brazilian stocks have tumbled 17% this year in dollar terms as volatility stemming from next year’s presidential election, as well as concern about fiscal policy, persuades many Brazilians to try to diversify risk, including through international investments.
Bradesco, which has 545 billion reais in assets under management, cut a $500 million deal in 2019 to purchase Coral Gables, Florida-based BAC Florida Bank, which serves high-income clients mostly from Latin America.
Other companies are taking similar steps to capitalize on the trend. Miami-based Avenue Securities, which offers brokerage services to Brazilians wanting to invest in U.S. assets, in August received a $30 million second round of investments led by
BCP Global, which offers digital solutions for financial institutions in Latin America, uses a strategy that reinvests dividends and other distributions to help avoid the potential need for daily tax payments for non-U.S. residents. Portfolios are built using UCITS ETFs, which are exchange-traded funds registered in Europe.
“We are starting with digital portfolio advice in order to help Brazilian clients cross the barrier of foreign investment, and then will offer U.S. digital brokerage services to them,” Miranda said in an interview.
