Banco Hyundai Capital Brasil has been launched with initial capital of 300 million Brazilian reais ($76.8 million) to support customers and dealers of carmaker Hyundai Motor with financial services, Hyundai Capital said.

The consumer financing service provider unit stemmed from a joint effort by Hyundai Capital, the financial arm of Hyundai Motor Group, and Santander Brasil, a listed subsidiary of Spanish commercial banking group Santander.

Hyundai Capital and Santander Brasil equally hold 50%  stakes of the Sao Paulo-based joint venture, according to Hyundai Capital. The capital was raised in two rounds in May 2018 and February this year.

This marks the first time for a Seoul-based captive financing company dedicated to automotive financing and leasing to gain a license to operate an offshore lender in a South American market.

Hyundai Motor has about 9% market share, the fifth-largest in the Brazilian automotive market as of end-2018. Hyundai Capital said it sees great potential in the Brazilian automotive industry on the back of rising demand for new cars in Brazil.

«Hyundai Capital is supporting Hyundai Motor’s sales with a localization strategy based on the expertise that the company has accumulated in the market for many years.» Yoono Hwang, global president of Hyundai Capital, said in a statement.

The announcement came two months after Hyundai and Santander received authorization to operate a joint lender by the Brazil Central Bank in February.

Prior to the launch of the lender, Hyundai Motor’s Brazilian unit has been offering captive financial support by Hyundai Financiamentos, operated by Santander Brasil. Hyundai Capital said the contracts with Financiamentos customers will be gradually updated to Banco Hyundai Capital Brasil.

Original Story: The Investor | Son Ji-hyoung
Photo: Hyundai Motors Brasil site
Edition: Prime Yield