Banco da Lavoura de Minas Gerais
Encyclopedia
Banco da Lavoura de Minas Gerais was a Brazilian bank, founded in 1925. On March 1, 1971 the bank moved its head office from Belo Horizonte
to São Paulo
and assumed its current name Banco Real
S.A.
, Minas Gerais
state, on 16 June 1925. At that time, Brazil
was going through a period of economic readjustment that held back economic development and particularly, industrial production, which had been expanding strongly since 1922. It was in the middle of this scenario of economic uncertainty that the lawyer Clemente de Faria - then 34 years old and quite popular as a result of a one-term mandate as state congressman - started a co-operative. The co-operative's objective was to offer credit to farmers in Minas Gerais, thus allowing them access to financial resources that would, in turn, give them the opportunity to develop their activities.
Business at the co-operative grew quickly, despite the general economic uncertainty. In only two years, it transformed itself into a financial institution - the Banco da Lavoura de Minas Gerais (Farmer's Bank of MG) - all the while remaining faithful to its initial goal: providing small farmers with access to farm loans and opportunities to invest their money.
Working with this constituency and adopting innovative solutions for the banking market of its time, "Lavoura", as it was called in Minas Gerais, began to distinguish itself. It attracted the attention of other bankers, who, laughingly, called the bank, "Clemente's little bank", thus was the reputation of its success in the market. However, this sense of humour did not keep them from adopting solutions and products pioneered by "Banco de Lavoura" for their own institutions, such as: personal credit, the economic account (very similar to today's savings account) and the idea of a "piggy bank".
The process of continuous growth at Banco da Lavoura led to its transformation into a limited liability corporation in 1928. Already in the following year, resting on solid foundations, Banco da Lavoura was able to survive the difficulties engendered by the international financial crisis (the crash of '29), which in turn brought economic instability to Brazil and culminated in the revolution of 1930. Despite all that, Banco da Lavoura continued its expansion, opening its first branch in the city of Queluz
, later renamed Conselheiro Lafayette.
From then on, the bank grew by opening new branches and acquiring other institutions. In 1934, under the first Getulio Vargas government, the Lavoura bought Banco Comercial de Bom Sucesso. Two years later, while the economy signalled the shrinking importance of coffee exports for the Brazilian trade balance, Banco da Lavoura crossed the borders of Minas Gerais and opened its first branch outside the state, in the city of Rio de Janeiro
. In 1937, already with 25 branches and 14 offices, Banco da Lavoura became the 25th largest financial institution in Brazil.
The policy of expansion through the acquisition of other banks consolidated itself in 1937 with the purchase of Banco J. O. Resende and received a strong impulse in 1938. That year, Banco de Lavoura also acquired Banco Comercial de Alfenas, Banco de Pouso Alegre, Banco de Campanha and Banco Santaritense.
Banco da Lavoura continued to consolidate its position as an active participant on the Brazilian financial market, counting on significant capital increases and the opening of new branches and offices in important locations, in addition to continuing its policy of acquiring other institutions.
The bank arrived in São Paulo
, Brazil's financial centre, in 1945, when it opened its first branches in the capital of São Paulo state. At that time, Brazil was going through considerable political turmoil, which led to the removal of Getulio Vargas and the end of the Estado Novo, established by Vargas in 1937.
In 1948, the bank came to the north-east of Brazil, opening branches in the cities of Recife
, Pernambuco
state and Salvador
in Bahia
. At the same time, Banco da Lavoura set up business in Amapá
, thus helping with the integration of the then federal territory through the provision of credit for a company created to extract manganese, the mineral wealth of that region.
In the same year, Dr. Aloyisio de Andrade Faria succeeded his father, who had died in October 1948 at the age of 57. Aloyisio Faria managed the bank by closely following his father's project and policies. Only 28 years at the time, he accomplished the goal of transforming Banco da Lavoura into a financial institution present all over Brazil.
From 1948 until 1955, Banco da Lavouras expanded its network of branches in São Paulo state and in the north-east of the country. It installed a branch in Porto Alegre
, Rio Grande do Sul
and acquired Banco do Norte do Brasil S.A., Alagoas
, adding a network of 180 branches to the organisation. At that time, Banco da Lavoura became the largest private bank in Brazil.
With its position in Brazil consolidated, the bank began its operations abroad. In 1957, it was the first Brazilian bank to open a representative office - which was to become a full agency in 1964 - in New York
. Also in 1957, it was the first bank to set up business in Brasilia
, even before the inauguration of the future federal capital, thus receiving the "operating license No. 1". During the period from 1958 to 1966, Banco da Lavoura purchased Banco Vera Cruz, with a total of 346 branches, and created Banco Real de Investimentos S.A.
The year 1969 was marked by important events, such as the creation of two additional financial businesses: Companhia Real de Investimentos (The Real Investment Company) and Companhia Real de Crédito Imobiliário (The Real Property Loans Company), in addition to the purchase of Banco Mercantil de Niterói.
On 1 March 1971 the bank moved its head office from Belo Horizonte to São Paulo and the bank assumed its current name Banco Real
S.A.
Belo Horizonte
Belo Horizonte is the capital of and largest city in the state of Minas Gerais, located in the southeastern region of Brazil. It is the third largest metropolitan area in the country...
to São Paulo
São Paulo
São Paulo is the largest city in Brazil, the largest city in the southern hemisphere and South America, and the world's seventh largest city by population. The metropolis is anchor to the São Paulo metropolitan area, ranked as the second-most populous metropolitan area in the Americas and among...
and assumed its current name Banco Real
Banco Real
Banco Real was a Brazilian bank, owned by Spain's Banco Santander. ABN AMRO had owned the bank but in October 2007, a consortium led by Royal Bank of Scotland that also included Banco Santander and Belgium's Fortis, acquired ABN AMRO and proceeded to dismember it...
S.A.
History
Clemente de Faria founded Banco da Lavoura de Minas Gerais in Belo HorizonteBelo Horizonte
Belo Horizonte is the capital of and largest city in the state of Minas Gerais, located in the southeastern region of Brazil. It is the third largest metropolitan area in the country...
, Minas Gerais
Minas Gerais
Minas Gerais is one of the 26 states of Brazil, of which it is the second most populous, the third richest, and the fourth largest in area. Minas Gerais is the Brazilian state with the largest number of Presidents of Brazil, the current one, Dilma Rousseff, being one of them. The capital is the...
state, on 16 June 1925. At that time, Brazil
Brazil
Brazil , officially the Federative Republic of Brazil , is the largest country in South America. It is the world's fifth largest country, both by geographical area and by population with over 192 million people...
was going through a period of economic readjustment that held back economic development and particularly, industrial production, which had been expanding strongly since 1922. It was in the middle of this scenario of economic uncertainty that the lawyer Clemente de Faria - then 34 years old and quite popular as a result of a one-term mandate as state congressman - started a co-operative. The co-operative's objective was to offer credit to farmers in Minas Gerais, thus allowing them access to financial resources that would, in turn, give them the opportunity to develop their activities.
Business at the co-operative grew quickly, despite the general economic uncertainty. In only two years, it transformed itself into a financial institution - the Banco da Lavoura de Minas Gerais (Farmer's Bank of MG) - all the while remaining faithful to its initial goal: providing small farmers with access to farm loans and opportunities to invest their money.
Working with this constituency and adopting innovative solutions for the banking market of its time, "Lavoura", as it was called in Minas Gerais, began to distinguish itself. It attracted the attention of other bankers, who, laughingly, called the bank, "Clemente's little bank", thus was the reputation of its success in the market. However, this sense of humour did not keep them from adopting solutions and products pioneered by "Banco de Lavoura" for their own institutions, such as: personal credit, the economic account (very similar to today's savings account) and the idea of a "piggy bank".
The process of continuous growth at Banco da Lavoura led to its transformation into a limited liability corporation in 1928. Already in the following year, resting on solid foundations, Banco da Lavoura was able to survive the difficulties engendered by the international financial crisis (the crash of '29), which in turn brought economic instability to Brazil and culminated in the revolution of 1930. Despite all that, Banco da Lavoura continued its expansion, opening its first branch in the city of Queluz
Queluz
Queluz may refer to:*Queluz, Portugal, a city in the municipality of Sintra, Portugal**The Queluz National Palace, located in the city*Queluz , a civil parish in the municipality of Sintra, Portugal...
, later renamed Conselheiro Lafayette.
From then on, the bank grew by opening new branches and acquiring other institutions. In 1934, under the first Getulio Vargas government, the Lavoura bought Banco Comercial de Bom Sucesso. Two years later, while the economy signalled the shrinking importance of coffee exports for the Brazilian trade balance, Banco da Lavoura crossed the borders of Minas Gerais and opened its first branch outside the state, in the city of Rio de Janeiro
Rio de Janeiro
Rio de Janeiro , commonly referred to simply as Rio, is the capital city of the State of Rio de Janeiro, the second largest city of Brazil, and the third largest metropolitan area and agglomeration in South America, boasting approximately 6.3 million people within the city proper, making it the 6th...
. In 1937, already with 25 branches and 14 offices, Banco da Lavoura became the 25th largest financial institution in Brazil.
The policy of expansion through the acquisition of other banks consolidated itself in 1937 with the purchase of Banco J. O. Resende and received a strong impulse in 1938. That year, Banco de Lavoura also acquired Banco Comercial de Alfenas, Banco de Pouso Alegre, Banco de Campanha and Banco Santaritense.
Banco da Lavoura continued to consolidate its position as an active participant on the Brazilian financial market, counting on significant capital increases and the opening of new branches and offices in important locations, in addition to continuing its policy of acquiring other institutions.
The bank arrived in São Paulo
São Paulo
São Paulo is the largest city in Brazil, the largest city in the southern hemisphere and South America, and the world's seventh largest city by population. The metropolis is anchor to the São Paulo metropolitan area, ranked as the second-most populous metropolitan area in the Americas and among...
, Brazil's financial centre, in 1945, when it opened its first branches in the capital of São Paulo state. At that time, Brazil was going through considerable political turmoil, which led to the removal of Getulio Vargas and the end of the Estado Novo, established by Vargas in 1937.
In 1948, the bank came to the north-east of Brazil, opening branches in the cities of Recife
Recife
Recife is the fifth-largest metropolitan area in Brazil with 4,136,506 inhabitants, the largest metropolitan area of the North/Northeast Regions, the 5th-largest metropolitan influence area in Brazil, and the capital and largest city of the state of Pernambuco. The population of the city proper...
, Pernambuco
Pernambuco
Pernambuco is a state of Brazil, located in the Northeast region of the country. To the north are the states of Paraíba and Ceará, to the west is Piauí, to the south are Alagoas and Bahia, and to the east is the Atlantic Ocean. There are about of beaches, some of the most beautiful in the...
state and Salvador
Salvador, Bahia
Salvador is the largest city on the northeast coast of Brazil and the capital of the Northeastern Brazilian state of Bahia. Salvador is also known as Brazil's capital of happiness due to its easygoing population and countless popular outdoor parties, including its street carnival. The first...
in Bahia
Bahia
Bahia is one of the 26 states of Brazil, and is located in the northeastern part of the country on the Atlantic coast. It is the fourth most populous Brazilian state after São Paulo, Minas Gerais and Rio de Janeiro, and the fifth-largest in size...
. At the same time, Banco da Lavoura set up business in Amapá
Amapá
Amapá is one of the states of Brazil, located in the extreme north, bordering French Guiana and Suriname to the north. To the east is the Atlantic Ocean, and to the south and west is the Brazilian state of Pará. Perhaps one of the main features of the state is the River Oiapoque, as it was once...
, thus helping with the integration of the then federal territory through the provision of credit for a company created to extract manganese, the mineral wealth of that region.
In the same year, Dr. Aloyisio de Andrade Faria succeeded his father, who had died in October 1948 at the age of 57. Aloyisio Faria managed the bank by closely following his father's project and policies. Only 28 years at the time, he accomplished the goal of transforming Banco da Lavoura into a financial institution present all over Brazil.
From 1948 until 1955, Banco da Lavouras expanded its network of branches in São Paulo state and in the north-east of the country. It installed a branch in Porto Alegre
Porto Alegre
Porto Alegre is the tenth most populous municipality in Brazil, with 1,409,939 inhabitants, and the centre of Brazil's fourth largest metropolitan area . It is also the capital city of the southernmost Brazilian state of Rio Grande do Sul. The city is the southernmost capital city of a Brazilian...
, Rio Grande do Sul
Rio Grande do Sul
Rio Grande do Sul is the southernmost state in Brazil, and the state with the fifth highest Human Development Index in the country. In this state is located the southernmost city in the country, Chuí, on the border with Uruguay. In the region of Bento Gonçalves and Caxias do Sul, the largest wine...
and acquired Banco do Norte do Brasil S.A., Alagoas
Alagoas
Alagoas is one of the 27 federative units of Brazil and is situated in the eastern part of the Northeast Region. It borders: Pernambuco ; Sergipe ; Bahia ; and the Atlantic Ocean . It occupies an area of 27,767 km², being slightly larger than Haiti...
, adding a network of 180 branches to the organisation. At that time, Banco da Lavoura became the largest private bank in Brazil.
With its position in Brazil consolidated, the bank began its operations abroad. In 1957, it was the first Brazilian bank to open a representative office - which was to become a full agency in 1964 - in New York
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...
. Also in 1957, it was the first bank to set up business in Brasilia
Brasília
Brasília is the capital city of Brazil. The name is commonly spelled Brasilia in English. The city and its District are located in the Central-West region of the country, along a plateau known as Planalto Central. It has a population of about 2,557,000 as of the 2008 IBGE estimate, making it the...
, even before the inauguration of the future federal capital, thus receiving the "operating license No. 1". During the period from 1958 to 1966, Banco da Lavoura purchased Banco Vera Cruz, with a total of 346 branches, and created Banco Real de Investimentos S.A.
The year 1969 was marked by important events, such as the creation of two additional financial businesses: Companhia Real de Investimentos (The Real Investment Company) and Companhia Real de Crédito Imobiliário (The Real Property Loans Company), in addition to the purchase of Banco Mercantil de Niterói.
On 1 March 1971 the bank moved its head office from Belo Horizonte to São Paulo and the bank assumed its current name Banco Real
Banco Real
Banco Real was a Brazilian bank, owned by Spain's Banco Santander. ABN AMRO had owned the bank but in October 2007, a consortium led by Royal Bank of Scotland that also included Banco Santander and Belgium's Fortis, acquired ABN AMRO and proceeded to dismember it...
S.A.