Investment Banking in Brazil

Updated on February 13, 2024
Article byWallstreetmojo Team
Edited bySusmita Pathak
Reviewed byDheeraj Vaidya, CFA, FRM

Investment Banking in Brazil Overview

Investment Banking in Brazil is one of the dominant sectors in the nation with bank which not only act the intermediary between companies and investors helping the latter invest in stock s or bonds whenever the former issues them, but also offers a boost to the employment rate by keeping employment opportunities for individuals in the country.

Investment Banking in Brazil - Services Offered

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Investment banking in Brazil is only second to the United States with respect to the revenue it is expected to generate in 2024. As the investment banking industry has strong emphasis on sustainability of a nation, Brazil seems to have a positive impact of the growth that has been witnessed in the investment banking sector so far and also expected to be seen in the coming years.

Investment Banking in Brazil Explained

Investment Banking in Brazil is a service offered through investment banks, which guide clients or investors towards cracking best investment deals offered by companies in addition to being the best employment opportunity providers. Brazilians have been into making savings into savings account or investing into the fixed-income schemes. However, with time, they started looking for better yields and this is where investment banking entered the scenario.

Investment banks offers investment plans to clients based on when and how much they can invest in a deal. These entities allow investors to maintain a diversified portfolio to keep their risk-reward ratio balanced. Connecting with investment banking units help investors be prepared for fluctuations in the market and be adaptive of the dynamic market scenarios.

Investment Banking in Brazil

Source: gulf-times.com

The investment entities in Brazil have been seen holding 10% of clients’ assets, which is now expected to reach up to 25% in 2024. This expansion will thereby allow these investment banking players to perform in the adjacent markets as well, including insurance, payments and credit niches, developing their client base and making it stronger than ever before.

The investment banking market in Brazil is likely to reach a revenue figure worth $29.28 billion in 2024 with an expected annual growth rate of 1.69%, amounting to $31.31 billion by 2028.

Characteristics

Brazil is one of the most popular emerging markets in investment bankingInvestment BankingInvestment banking is a specialized banking stream that facilitates the business entities, government and other organizations in generating capital through debts and equity, reorganization, mergers and acquisition, etc.read more. A few things about Brazil make it a unique place for investment bankers. Let us look at the features below to understand every aspect of the investment banking sector and explore how it works.

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Services

As already mentioned, investment banks in Brazil mainly deal with two kinds of deals – restructuringRestructuringRestructuring is defined as actions an organization takes when facing difficulties due to wrong management decisions or changes in demographic conditions. Therefore, tries to align its business with the current profitable trend by a) restructuring its finances by debt issuance/closures, issuance of new equities, selling assets, or b) organizational restructuring, which includes shifting locations, layoffs, etc.read more and M&A deals. But other than that, they also execute deals that revolve around the capital and debt market.

Let’s have a look at the services offered by the Brazilian investment banks –

Now, let’s look at the list of top banks in Brazil.

List of Top Investment Banks in Brazil

We have two data points to look at the top investment banks in Brazil. First, we will look at the data of 2012 as per Global Banking & Finance Review, and then according to the Leaders’ League, we will glance through the best investment banks in M&A deals for the year 2016.

#1 – Global Banking & Finance Review

According to Global Banking & Finance Review, here’s a list of investment banks that stand out in the crowd in the year 2012 –

  • ABC Brasil
  • Banco Bradesco
  • Banco Cruzeiro do Sul
  • Banco de Brasilia
  • Banco do Brasil
  • Banco do Nordeste
  • Banco Safra
  • Banco Votorantim
  • Banestes
  • Banrisul
  • BicBanco
  • Brazilian Development Bank
  • BTG Pactual
  • Caixa Economica Federal
  • Central Bank of Brazil
  • Daycoval
  • HSBC Bank
  • Itau Unibanco
  • PanAmericano
  • Parana Banco
  • Santander Brasil

#2 – Leader’s League

We will now look at the 2016 rankings in M&A deals given by the Leaders’ League. They divided the top investment banks again into four labels – leading, excellent, highly recommended, and recommended –

Leading: Under “leading”, here are the top investment banks in Brazil –

Excellent: Under “excellent,” the top investment banks are –

  • Bank of America Merrill Lynch
  • Goldman Sachs
  • JP Morgan
  • Rotschild & CIE
  • Santander

Highly recommended: Under “highly recommended,” the top banks are –

  • Banco Votorantim
  • Barclays Capital
  • Citibank International
  • Credit Suisse
  • Deutsche Bank
  • IGC Partners
  • Lazard
  • UBS Investment Bank

Recommended: Under “recommended,” these are the banks that made their mark –

  • Albatros
  • Banco Safra
  • BNP Paribas
  • BR Partners
  • Brasilpar
  • Credit Agricole CIB
  • EP Capital
  • G5 Evercore
  • Greenhill & Co
  • Lincoln International
  • Pangea Partners
  • Xingu Capital

Recruitment Process

Even if it seems that Brazil could be easy to get into investment banking, the truth is something else. It’s quite tough to get into investment banking in Brazil. If one likes to build a career in the investment bankingCareer In The Investment BankingAn investment banking personnel is a motivated professional who aims to help their clients reach their financial goals and objectives. The top four investment banking careers are - Analyst, Associate, Vice president, Managing director. read more in Brazil, the following pointers will help them leap –

Culture

As the team is smaller in small investment banks in Brazil, deals per person are also bigger. Every analyst/associate normally handles 5-6 deals at a time which is too much. As a result, no one could focus on one big deal properly.

In large investment banks in Brazil, things are much more difficult to handle. During a certain period, every analyst/associate handles 8-9 deals simultaneously.

So, you may think that the work hours would be huge. But in small investment banks, as an associate/analyst, you need to work around 55-60 hours per week. And in larger firms, as an associate/analyst, you would be working around 70 hours per week.

The work culture is quite hectic, and you would always be running for deals, reports, sourcing, presentations, and LOIs. And as the team is smaller, work pressure is much more. That means you can go to anyone (MDs, EDs, VPs), asking for anything. And at the same time, you need to take personal responsibility to close the deals. There’s almost no social life due to work pressure.

Also, have a look at Investment Banking LifestyleInvestment Banking LifestyleLong working hours, weekend work, a lot of hard work, and little sleep are all part of an investment banker's life. Life as an investment banker is described as hectic, but for those who want to live a life of dedication, competition, and risk while also performing well, investment banking is the appropriate choice.read more

Salaries

The investment banking salaries in Brazil are not exciting. If you consider the exchange rate of Brazilian Real with United States Dollars, you would see that 1 Real means only 0.30 USD.

Now, let’s look at Brazil’s average investment banking salaries first, and then we will discuss further.

Investment Banking in Brazil - Salary

source: glassdoor.co.in

You can now see the average salary of investment banking professionals. Let’s take the salary of the investment banking analystInvestment Banking AnalystInvestment Banking Analyst works with investment banking team and expertise in the area of Accounting, Financial Modeling, Project financing, Project Valuation, and Financial statement Analysis. These analyst has deep knowledge in Excel and they are good at VBA to analyze the market data and financial modeling. The analytic work consists of building a financial model for different projects like Infrastructure projects (i.e. Power projects, real estate, etc.).read more at Citi. The average salary for this individual is around R$175,000 per annum, which means in USD, it is less than US$60,000 per annum.

When investment bankers worldwide earn at least six figures, salaries in Investment Banking in Brazil look dim. However, for local candidates, maybe this is a great compensation.

Exit Opportunities

People in Brazil don’t look for exit opportunities most of the time. Because it’s hard to get into investment banking and private equity, there are fewer chances of career growth.

In private equity in Brazil, people get hired directly out of college and get paid pretty little. So, you can understand why investment bankers don’t like to go into private equity.

But suppose you would like to quit investment banking and go for private equity. In that case, you can go for international funds because these international funds hire investment bankers with 2-3 years of experience.

This has been a guide to Investment Banking in Brazil and its overview. We explain its characteristics, services, and list of top investment banks in Brazil. You may also look at the following article to learn more about Investment Banking.

Reader Interactions

Comments

  1. Jason Porter says

    Fantastic Blog!! This article has helped me to understand the detailed overview of investment banking in Brazil and i even want to know the same for investment banking in Australia, have you discussed about this anywhere, then please let me know. Thanks in advance.. Have a great day ahead.