Scotiabank de Puerto Rico, a wholly owned subsidiary of Canada-based Scotiabank, has acquired R-G Premier Bank Puerto Rico operations, including the customer deposits. The transaction was facilitated by Federal Deposit Insurance Corporation (FDIC) and it is effective immediately.

Under the terms of the transaction, Scotiabank will acquire $5.6bn in assets including $5.3bn in loans covered under a loss-sharing agreement with the FDIC. Through this agreement, the FDIC guarantees 80% of loan losses. The acquisition also includes $2.2bn in deposits.

The FDIC is providing additional funding to balance the acquired assets. The transaction will result in an immediate positive contribution to earnings for Scotiabank Group but is not material to current earnings or capital.

R-G Premier Bank of Puerto Rico has 29 branches and 61 ATMs and Scotiabank de Puerto Rico has 17 branches and 60 ATMs. The consolidation will begin immediately.

However, the deposits of R-G Premier Bank customers will continue to be insured by the FDIC up to the insurance limit. Customers can continue to bank at these locations and will be served by the same teams.

Rick Waugh, president and CEO Of Scotiabank, said: “The announcement will increase our market share to approximately nine per cent and is consistent with Scotiabank’s international strategy to grow incrementally to scale in target markets. Scotiabank has an international scope that few banks match, and we look forward to leveraging our strengths and expertise to benefit the ongoing operations of the new bank.”

Troy Wright, CEO of Scotiabank de Puerto Rico, said: “We are committed to leveraging our significant experience in international acquisitions to provide a smooth transition for all of our new and existing customers and employees and as we move through the transition phase, we will look at the best practices of each of the banks to bring our customers exceptional products, lending, services and expertise.”