Goldman Sachs Group Inc. (GS:US) will open a local broker-dealer in Mexico early next year as part of its expansion in Latin America, said Stephen Scherr, the firm’s chief for the region.
The move will allow Goldman Sachs to trade in peso-denominated securities, Scherr said today in a broadcast on the firm’s website. The New York-based investment bank won authorization for a Mexican brokerage unit last year.
“We have a very bullish view on Mexico,” said Scherr, 49, who is also global head of the company’s financing group. “We have a very strong presence in Mexico City, and in fact, by the early part of next year, we’ll have a local broker-dealer in the country.”
Goldman Sachs, the fifth-largest U.S. bank by assets, opened a local office in Santiago, Chile, earlier this year. Foreign companies with Mexican brokerages include Morgan Stanley (MS:US) and Credit Suisse Group AG, according to the Mexican Association of Brokerages. Citigroup Inc. (C:US)’s Banamex unit also owns a major brokerage.
Reforms planned by Mexican President Enrique Pena Nieto, who was elected last year, and efforts to develop the country’s capital markets will probably attract investors, Scherr said.
“Anytime a market can become larger, deeper, more liquid, like what the Mexicans are doing, it is inevitably to the benefit of the economy, because I think the market will demonstrate greater price rationality, and will attract more and more investors to that market,” he said. “It is why we’re going there in bigger size.”
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