Costa Rica 2017 | FINANCE | INTERVIEW

TBY talks to Silvio Lacayo, General Manager of Desyfin, on building a family business into a bank, services that are in demand, and expectations for the future.

Silvio Lacayo
Silvio Lacayo has a degree in business administration from the Universidad Internacional de las Américas and a licentiate from the Universidad Interamericana de Costa Rica. Between 1994 and 1997, he studied at Texas A&M International University in the US, where he obtained an MA. Lacayo is also a licensed insurance broker authorized by the National Insurance Institute (INS). In 1991, he became General Manager of Inversiones Telefónicas del Oeste, S.A., a company involved in personal loans, secured loans, and consumer banking. In March 1993, he took on his current position as General Manager of Desyfin.

What have been your main achievements and milestones on your 25th anniversary in Costa Rica?

Desyfin started as a family entrepreneurship company in 1991, a dream of my father, who is the president of the company. After two or three years, my brothers, Mauricio and Manfred Lacayo, and my mother, Hortensia, joined the company; In the early years, our products and services were mainly focused on factoring; eventually we developed our portfolio providing additional solutions to our customers. We started off as a boutique financial institution targetting SMEs with good quality service and a strong customer focus. In 1997-1998, we became a regulated financial institution by SUGEF, Costa Rica's financial system regulator. Subsequently, we were able to issue bonds, offer certificate of deposits (CDs), savings accounts, and so on.

Which of your services and products show the most potential in Costa Rica?

SMEs are growing rapidly in Costa Rica, particularly those that do business with big suppliers and multinational companies in free zones. Once your financial products and services fulfil your customers' requirements, new business and growth opportunities open up and you are headed for success. Desyfin offers savings accounts, CDs, commercial, automobile, and housing loans, provides credit cards, and manages forex currencies, among other services. We have become a complete financial institution for these customers.

Desyfin has seven branches in the area and recently invested USD100,000 in a new office in Grecia. Are you planning further expansion?

We are always looking at locations with a high development rate in Costa Rica, where we can potentially expand to. We recently opened a branch in Limón (Guápiles). There was a large and significant project developing in that province, a USD4 billion hydroelectric project, and we decided to open a branch there to serve all the SMEs involved in that specific initiative. We currently have seven branches nationwide.

The company is already in the process of becoming a bank. When do you expect this to be completed and what will this bring to Desyfin?

For shareholders, becoming a bank definitely adds value to the company. As a bank it will also have lower cost of funds, access to cheaper and more credit, institutional lines of credit around the world, and greater reputation, all those benefits can be transferred to our customers. We expect to become a bank in the next two years, but there is no specific date yet. This is an important process and we are working with Costa Rica's authorities to complete all the requirements.

Desyfin has a diversified source of financial resources from banks from all over the world. What opportunities does this bring to the company?

About 60% of our funding is external. Our main source of financial resources are coming from different banks and government institutions, such as DEG from Germany, FMO Entrepreneurial Development Bank from the Netherlands, Overseas Private Investment Corporation (OPIC) from the US, Norfund from Norway, and MicroVest from the US. In 2008, during the financial crisis, many commercial banks, for instance Citibank and Bank of America, were strongly impacted during this crisis, and we would have been in trouble if we had relied only on them. This diversified credit structure that we pursue has been an effective strategy in terms of diversifying our risk. At the moment, we have access to credit lines from Europe and the US, as well as banks in Panama and other countries and regions around the world.

What is your outlook for the sector in the mid term?

We are pursuing the license to become a bank; our next step would be to expand our business to Central America. We hope to accomplish this goal in the next five years. Our plan is to start operations in one of those countries, then move to a new country every year; however, that decision has not been taken yet.