Pacific pioneers: Asian financial institutions enter Mexico
Mexico's banking sector, newly open to foreign entities, draws Asia-based financial institutions for multiple reasons.
For most of Mexico's history, foreign state-owned entities were not permitted to participate in the capital ownership of a Mexican bank. This meant that Mexico's heavily regulated financial services industry was effectively closed to all banks whose owners or investors included foreign sovereign entities.
This changed in 2014, when Mexican legislative reforms began allowing these banks to establish subsidiary operations in Mexico in limited circumstances.
Almost immediately, Asian banks began crossing the Pacific as some of the primary pathfinders in Mexico's newly open financial services markets.
The trends that initially drew Chinese, South Korean and other Asian financial institutions to set up their own banking institutions in Mexico continue in the current investment climate. These include opportunities to provide financing support for Asia-based multinational manufacturers and other Asia-based corporations in Mexico.
Depending on political and trade developments over the next few years, the growth potential for Asian financial institutions in Mexico could continue to increase even further.
Asian banks were among the first to take advantage of new opportunities for foreign financial institutions in Mexico.
Obtaining the authorization to establish or acquire a bank in Mexico requires creativity, a deep understanding of Mexican regulatory authorities' procedures and a patient investment approach.