Bancomer, Mexico's largest retail bank, plans to build an extensive branch network in the Southwestern United States, the bank's chief executive officer disclosed last week.

Bancomer would like to open as many as 50 branches in Southern California, Texas, Arizona, and New Mexico starting in 1994, said Ricardo Guajardo Touche, who also serves as general director.

Some $1.5 billion of Bancomer's $29.8 billion in assets are currently booked in the United States. It, owns the $350 million-asset Grossmont Bank in La Mesa, Calif., and has agencies in Los Angeles and New York.

"We could use five more branches in the Los Angeles area alone," Mr. Guajardo said in an interview.

His comments followed a presentation on investments in Mexico at the New York Society of Security Analysts.

Mr. Guajardo noted that Bancomer needs approval from the Federal Reserve before it can proceed with the expansion because of the bank's recent change in ownership.

Second-largest in Mexico

Last year the Mexican government sold Bancomer to investors as part of a broader program to privatize 18 state-owned banks.

Bancomer's plans are not contingent on the pending North American Free Trade Agreement, which would permit U.S. banks to open subsidiaries in Mexico. Mexican banks already have the right to do business in the United States.

Bancomer is the second-largest bank in Mexico, after Banco Nacional de Mexico - or Banamex - which had $30.5 billion in assets at yearend 1991. With $20 billion in deposits, or 25% of all Mexican bank deposits, Bancomer is a major force in retail banking in Mexico.

Tentative U.S. Moves

Bancomer sought unsuccessfully several years ago to acquire Executive National Bank, a small bank in San Antonio.

Bancomer, Banamex, and Banca Serfin - another large Mexican institution - are said to be keen to expand in the United States to exploit an anticipated boom in trade and cross-border banking services after the trade agreement takes effect.

All three have recently been the target of Mexican press reports about' possible bids to acquire U.S. banks.

Regulatory Restrictions

Mr. Guajardo ruled out any U.S. acquisition, however, either directly or through Grossmont. He said complex state and federal regulations in the United States make these acquisitions unattractive. He also cited reservations about the quality of assets Bancomer might acquire.

"The regulatory situation in California is too restrictive, and we're not interested in buying up loans or other assets," he said.

"What would we do with them?"

Peso-denominated Quest

Mr. Guajardo cautioned that his bank's U.S. expansion will be gradual. He said Bancomer was most interested in developing retail and peso-denominated services for Mexicans living in the U.S. and for U.S. and Mexican companies involved in cross-border business.

Mr. Guajardo said it would be relatively easy to link branches in the U.S. border states to Bancomer's own network at home.

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