GUANGZHOU and TORONTO, Sept. 9, 2011 /CNW/ - Scotiabank today announced that it has been selected as the winning bidder to purchase a 19.99% stake in the Bank of Guangzhou (BGZ) for approximately CDN$719 million (CNY4.65 billion). The investment, which remains subject to regulatory approval, will be accretive to earnings in 2012.

BGZ is not publicly listed and is primarily government owned. With assets of CDN $24 billion and customer deposits of CDN$16 billion at the end of June 2011, BGZ is the 29^th largest bank in mainland China. The bank has a network of 84 branches and offices centered in Guangzhou, serving a significant retail deposit account base and also focusing on providing corporate and treasury services to companies in China.

"The Bank of Guangzhou is a strong, prosperous and well managed financial institution.  With this investment we can build on Scotiabank's international presence and experience in China and combine our core strengths in wealth management, personal and commercial operations with our new partners," said Rick Waugh, President and CEO of Scotiabank. "Asia is a region of strategic importance for Scotiabank and enhancing our investment in China supports our long term growth strategy."

"Scotiabank has the largest presence in China of any Canadian bank -- we have been doing business in the country for 29 years," said Brian Porter, Scotiabank Group Head of International Banking. "China has a strong emerging middle class and growing purchasing power and this investment puts Scotiabank in a solid position to expand on our existing platform and help develop the retail banking and wealth management sector."

The Bank anticipates the close of this transaction in December of 2011.

Guangzhou, China

• The city of Guangzhou is an important gateway to China and is the economic, technological, educational and cultural centre for the South China region.
• Guangzhou's GDP, which reached CNY1.06 trillion (CDN$156 billion) in 2010, has consistently been the 3^rd largest among all Chinese cities after Shanghai and Beijing.
• Guangzhou, with a population of more than 11 million, is the provincial capital of Guangdong, one of the most populous provinces in China, with about 100 million residents.

Scotiabank in the Greater China Area:

• Scotiabank has the largest presence in mainland China among Canadian banks.
• Representative office opened in 1982 and the Bank has branches located in Guangzhou, Chongqing, Shanghai, Hong Kong and Taipei
• Scotiabank holds a 14.8 per cent stake in Bank of Xi'an which will increase to 18.1 per cent pending regulatory approval.
• The Bank provides corporate and commercial banking, correspondent banking, foreign currency, foreign exchange and trade finance services
• ScotiaMocatta, a global leader in precious metals trading and finance, was accepted in 2008 as one of the first Foreign Financial Members of the Shanghai Gold Exchange (SGE), China's leading precious metals exchange.

Scotiabank in Asia/Pacific:

• Scotiabank operates in nine other countries across Asia/Pacific, including Australia, Egypt, India, Korea, Japan, Malaysia, Singapore, Thailand and Vietnam.

About Scotiabank
Scotiabank is one of North America's premier financial institutions and Canada's most international bank. With more than 70,000 employees, Scotiabank Group and its affiliates serve some 18.6 million customers in more than 50 countries around the world. Scotiabank offers a broad range of products and services including personal, commercial, corporate and investment banking. With assets above $567 billion (as at July 31, 2011), Scotiabank trades on the Toronto (BNS) and New York Exchanges (BNS). For more information please visit www.scotiabank.com.