Banco Real Case Analysis

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----------------------- Banco real: case analysis MAJOR CASE REPORT: BANCO REAL Prepared for: Fiona Hare – Department of Marketing Strategic Marketing Background – General Business Environment After suffering through years of economic downturns, Brazil is now finally beginning to achieve economic stability in 2004-2005. Inflation is now controlled, real GDP growth is now evident, and a positive political direction taken by President Lula is now prevailing. The two initial goals by President Lula were to decrease the amount of foreign debt and total government spending. These goals were achieved when Brazil recorded an increase in GDP in 2005 growing 5.2%. However, even though Brazil is now achieving positive rates of growth in economic terms, the Brazilian economy has been plagued with economic deficiencies for the past 20 years. As a result, social problems have become abound. Background – Company Situation Banco Real was founded in 1925 as a cooperative to farmers. During the late 1990’s the Brazilian financial sector faced an unprecedented number of mergers and acquisitions. One of those, was the Acquiring of Banco Real by ABN AMRO S.A. The bank acquired Banco Real in 1998 and as a result the company history began initiating. After acquisition, the merged bank now named ‘ABN AMRO REAL, had over two million retail customers and employed over 17,000 employees in 1998. The bank now became one of Brazil’s most regarded and successful privately owned banks. It is also among the leading financial institutions to have chosen a unique pathway by placing corporate social responsibility at the forefront of their business operations. Several other acquisitions were also being conducted during that time and as a result, competition was intense in the financial sector. Many of the larger competitors such as
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