Banco BMG’s history dates back to 1930 when it began as the Land Credit Bank. The bank has evolved and kept its place in Brazil’s financial industry. Even back then, BMG shared a lot in common with the Guimaraes family of Minas Gerais.
The Guimaraes family has always enjoyed a high status and reputation in Brazil. In 1930, Pentagna Guimaraes ventured into the financial industry and founded Banco Minas Gerais. The firm operated successfully in agriculture and manufacturing. When his son took over after him, the company’s direction changed to the financing of bulky and light vehicles.
The wheel of succession spun again in 1998 when an ambitious Ricardo Guimaraes took over the administration of the family fortune. Ricardo Guimaraes became the fourth heir of his lineage to run BMG. Predictably, the bank had to change course again and this time, it became a lender of consigned credit.
Ricardo Guimaraes’ ambition matched skill; therefore, his administration made huge strides forward. He streamlined the structure of the company for a leaner outlook and enlisted the services of banking agents. The firm also packaged low-interest rate loans for active and committed clients. BMG was ready to take over the market and went on to dominate the consigned credit markets.
At this point, it becomes quite apparent that the Guimaraes family has always been a critical input in the success of their firm. This fact brings us to the growing need for corporates and investors to diversify amidst risks involved in financial and stock markets. Ricardo being an experienced investor realized diversifying is the only way to push BMG forward and shield the bank from losses.
Banco BMG has been locked in negotiations with a host of banks concerning the supply and distribution of payroll and personal loans. A winning combination was later declared with BMG partnering Itau Unibanco in a joint venture. Through the new venture, BMG will be able to expand its payroll loans segment and solidify its dominance. There were initial fears that the partnership would weigh heavily on BMG’s performance, but it turns out the investments will grow.
Before the partnership can take effect, BMG will have to streamline the operations by first eliminating unprofitable products and services from its portfolio. Such a move will free up resources to concentrate on the performing elements. This process calls on a Guimaraes to take control and usher in a new era of growth.
Reports also indicate this could be the last duty Ricardo Guimaraes carries out as President and Chief Executive Officer. He is to surrender his position to another expert Antonio Hermann. Guimaraes and his family will now perform oversight roles on the board of the firm.