Johannesburg-based Standard Bank Group is downsizing its banking operations in Brazil as it scraps expansion plans of setting up a local banking business in the country as well as other emerging markets.
In a statement, Standard Bank spokesman Ross Linstrom was quoted by Bloomberg as saying that the lender is planning to outsource Brazilian banking operations to Africa and China.
Banco Standard de Investimentos, its Brazilian operation that opened its first office in Sao Paulo in 1998, manages $1.46bn in assets in the country, as per the central bank data.
"We have reduced the cost base in this entity and have simplified the business model in Brazil," Linstrom told the news agency.
"This simplified model should consume less capital and reducing our capital utilization over time will remain a key focus."
In order to cut costs and rationalize its operations amid "challenging" economic conditions, the lender decided to eliminate nearly 135 positions in its corporate and investment bank in London, in November last year.
In a bid to consolidate its operations globally and to invest in Africa, the bank started closing of its expansion strategy in emerging markets in 2011, and announced asset sales in Russia, Turkey and Argentina.
In December 2012, the lender disposed of 80% of its Argentine division for approximately $400m to Industrial & Commercial Bank of China.