UPDATE 1-HSBC, Brasil Brokers seal mortgage loan alliance

* Deal could help HSBC win mortgage holders in Brazil

* HSBC to pay 45 mln reais upfront in commissions
(Updates with analyst comment, shares in paragraphs 4-6)

SAO PAULO, Oct 15 (BestGrowthStock) – HSBC (HSBA.L: ), Europe’s
largest bank, signed a five-year partnership on Friday with
housing broker Brasil Brokers Participacoes (BBRK3.SA: ) to offer
mortgage loans in Latin America’s largest country.

The Sao Paulo-based company will collect a fee for each
loan contract signed during the partnership, which could be
renewed for another five years, according to a regulatory
filing.

The agreement calls for HSBC to pay 45 million reais ($27
million) in advance installments to Brasil Brokers.

The deal underscores a push by Brazil’s largest banks to
look for new business in the nation’s burgeoning mortgage
lending market. While home lending represents less than 5
percent of Brazil’s annual gross domestic product,
disbursements are growing at a pace of nearly 50 percent a
year.

The deal comes as “an alternative and higher-return way to
play the buoyant Brazilian housing market (similar sales growth
profile) without being exposed to some of the investment risks
inherent to the builders,” Credit Suisse analysts Marcello
Milman and Alexandre Queiroz wrote in a note to clients on
Friday.

Brasil Brokers, Latin America’s biggest real estate
brokerage, expects commissions to reach 156 million reais in
the first five years, the filing said. The company could reap
about 425 million reais if the partnership stretches for 10
years.

Rival broker Lopes and Itau Unibanco (ITUB4.SA: ) began a
similar partnership in 2007.

Brasil Brokers rose 1 percent to 9.40 reais on Friday.

($1=1.658 reais)

(Reporting by Guillermo Parra-Bernal and Alberto Alerigi
Jr; Editing by Lisa Von Ahn, Dave Zimmerman)

UPDATE 1-HSBC, Brasil Brokers seal mortgage loan alliance