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Bank of Nova Scotia BNS-T head of international banking Ignacio (Nacho) Deschamps is leaving the bank, as its new chief executive officer taps an external hire to lead its renewed focus on Latin America.

The bank said in a statement Monday that Mr. Deschamps is retiring at the end of April after seven years at the lender. He was considered a contender for Scotiabank’s top job before board member Scott Thomson was appointed as CEO, stepping into the role in early February.

To fill the executive seat, Mr. Thomson is bringing in a new hire, Francisco Aristeguieta, currently executive vice-president and CEO of Boston-based bank State Street Corp.’s institutional services unit.

The change comes as Mr. Thomson launches a new strategy to rejig Scotiabank, turning his focus toward the lender’s Latin America division. At the bank’s annual shareholder meeting last week, the CEO highlighted its Mexico business as part of a larger effort to grab market share in the trading bloc known as the Pacific Alliance – which also includes Peru, Colombia and Chile.

Since joining Scotiabank in 2016, Mr. Deschamps oversaw the bank’s personal, small business and commercial banking operations globally outside of Canada, and he led Scotiabank’s digital transformation.

Under his tenure, the bank restructured its international unit, selling off its operations in Antigua and Barbuda, and increasing its stake in its Chilean division. Before joining Scotiabank, Mr. Deschamps served as CEO of Mexico’s largest bank, Grupo Financiero BBVA Bancomer.

“Nacho is an outstanding global banker with a deep knowledge of Latin America,” Mr. Thomson said in a statement. “During his time with the bank, he reshaped our international footprint, led our international markets through a pandemic and built a highly competitive banking franchise in our key markets. Nacho also led the bank through an enterprisewide digital journey, inspiring the team to deliver and scale digital solutions across our footprint to enhance our employee and customer experiences.”

Mr. Deschamps was in the running for the top job, along with capital markets head Jake Lawrence and retail banking head Dan Rees. Scotiabank’s board recently topped up the paycheques of Mr. Lawrence and Mr. Rees with retention bonuses. The bank said in its proxy in March that it gave each of the two a one-time stock award because of the “importance of maintaining the overall strength of the leadership bench, and the future potential of Mr. Lawrence and Mr. Rees.”

Mr. Aristeguieta steps into the role on May 1 after more than three decades of international banking experience in markets that include Latin America, North America, Asia, Europe and the Middle East. In his most recent role, he managed more than 85 per cent of State Street’s revenue globally and oversaw the strategic repositioning of its asset servicing business.

Prior to joining State Street in 2019, Mr. Aristeguieta spent 25 years at New York-based Citigroup Inc., where he led the businesses in the Latin America and Asia Pacific regions. He worked in both consumer and institutional-focused divisions, and managed the digitization of the bank’s cards, retail and wealth management businesses in Asia and the Middle East.

“Francisco is a seasoned transformational leader with a proven track record of delivering results, leading multiple business segments for major financial services organizations across global markets, including Latin America,” Mr. Thomson said. “As we look to refresh our strategy this year, Francisco will be a strong complement to our leadership team and will play a central role in helping us deliver long-term profitable and sustainable growth for our shareholders.”

The recruitment decision marks a “changing of the guard” as one of previous CEO Brian Porter’s “chief lieutenants departs the bank,” according to Barclays analyst John Aiken. He added that Mr. Aristeguieta brings “impressive” experience to the role as the bank looks to shake up its presence in its core international markets.

“This move underscores our belief that new CEO Scott Thomson is reviewing the bank’s Latin American operations and that very little, aside from Mexico, is exempt from scrutiny,” Mr. Aiken said in a note to clients. “We would not be surprised to see additional changes as Mr. Thomson puts his stamp on the bank and we look forward to the public release of his strategic review, which we anticipate could come as soon as this fall.”

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