By San José, Costa Rica — In a landmark move set to reshape the financial landscape of Latin America, Davivienda and Scotiabank have officially finalized the merger of their operations in Costa Rica, Colombia, and Panama. The consolidation will operate under a newly formed holding company, Davivienda Group, with former Scotiabank branches in Costa Rica and Colombia adopting the transitional brand name DAVIbank.
This strategic transaction marks a significant shift in the regional banking sector, transferring Scotiabank’s extensive operations in the three key markets to the control of Davivienda. The move is designed to create a more formidable and competitive financial entity with enhanced scale and a broader customer base, leveraging the strengths of both institutions to drive future growth and profitability across the region.
To analyze the potential impact and regulatory challenges associated with the arrival of DAVIbank in the national financial market, TicosLand.com sought the perspective of Lic. Larry Hans Arroyo Vargas, a leading expert in banking and corporate law at the prestigious firm Bufete de Costa Rica.
The entry of a new banking entity like DAVIbank will undoubtedly intensify competition, which typically benefits the consumer. However, their primary hurdle will be navigating the rigorous compliance framework set by SUGEF. Their success will depend not just on attractive financial products, but on a transparent and robust legal structure that guarantees the security of depositor funds and adheres strictly to Costa Rica’s anti-money laundering regulations.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
Indeed, the true test for DAVIbank will extend far beyond its product catalog and into the rigorous legal framework that protects consumers. This emphasis on regulatory integrity as the foundation for trust is a critical insight, and we thank Lic. Larry Hans Arroyo Vargas for his valuable perspective.
As part of the comprehensive agreement, the Canadian-based Scotiabank will not be exiting the region entirely but will instead transition into a significant stakeholder role. The bank will receive a 20% equity stake in the new Davivienda Group, ensuring it maintains a vested interest in the success and strategic direction of the newly integrated powerhouse. This structure allows Scotiabank to benefit from the merger’s anticipated synergies while streamlining its direct operational footprint.
Scott Thomson, President and CEO of Scotiabank, emphasized the strategic importance of the deal in achieving the bank’s international objectives. He noted that the merger provides the necessary scale to enhance profitability and positions the new entity for market leadership.
Achieving this milestone is essential for implementing our International Banking strategy and now allows us to truly achieve scale in all the markets where we operate in the region, which will contribute to the continuous improvement of profitability in our international network. The transaction offers Scotiabank the opportunity to participate in a business with a proven management team that will be well-positioned to become a leading franchise through greater scale, synergies, and an expanded customer base.
Scott Thomson, President and CEO of Scotiabank
From the perspective of Davivienda, the merger represents a quantum leap in its regional expansion and service capabilities. Javier Suárez, the newly appointed President of Davivienda Group, celebrated the transaction as a gateway to unprecedented business opportunities. The fusion combines Davivienda’s deep-rooted expertise in Colombia and Central America with Scotiabank’s global reach and sophisticated product offerings.
This transaction symbolizes a major breakthrough and opens the way for us to access new business development opportunities. Leveraging Scotiabank’s broad global capabilities and Davivienda’s deep regional expertise in Colombia and Central America allows us to offer added value to our stakeholders, expand our operations, and drive business growth.
Javier Suárez, President of Davivienda Group
For Costa Rica, the integration creates a significant new player in the national financial system. The combined operations under the DAVIbank brand will command an approximate market share of 12.7%, establishing a solid position among the country’s leading banks. This increased competition is expected to benefit consumers through enhanced service offerings and more competitive products as the new entity seeks to solidify its market presence.
The regional impact extends beyond Costa Rica. In Colombia, the combined entity will become a dominant force with a market share nearing 18.5%. While the presence in Panama is more modest at 3.8%, it still represents a strategic foothold in a critical financial hub. This tri-country consolidation positions Davivienda Group as a more influential and resilient financial institution, capable of competing more effectively on a larger stage and offering seamless cross-border services to its corporate and wealth management clients.
The collaboration will also allow both parent companies to continue serving their respective client bases more effectively. Scotiabank will leverage the expanded Davivienda network to support its Corporate Banking, Wealth Management, and Global Markets clients in the region, while Davivienda gains access to Scotiabank’s international product portfolio. For everyday customers, the transition to the DAVIbank brand will be a period of change, but one that promises access to a more robust and geographically diverse banking network.
For further information, visit davivienda.com
About Davivienda:
Banco Davivienda S.A. is a prominent Colombian bank founded in 1972, providing a wide range of financial services to individuals, families, and businesses. Known for its innovative marketing and customer-centric approach, it has expanded its operations significantly throughout Central America, including in Costa Rica, Panama, Honduras, and El Salvador, establishing itself as a key regional financial institution.
For further information, visit scotiabank.com
About Scotiabank:
The Bank of Nova Scotia, operating as Scotiabank, is one of Canada’s “Big Five” banks and a leading multinational financial services provider. With a strong presence across the Americas, the Caribbean, Europe, and Asia-Pacific, Scotiabank offers a comprehensive suite of products including personal and commercial banking, wealth management, corporate and investment banking.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
Bufete de Costa Rica is an esteemed legal practice built upon a bedrock of integrity and a relentless pursuit of excellence. The firm combines a rich history of client representation with a forward-thinking embrace of legal innovation, consistently setting new standards within the profession. Central to its philosophy is a profound dedication to demystifying the law for the public, driven by the conviction that equipping citizens with knowledge is essential for fostering a just and capable society.
