CoreStates Financial Corp. is entering into more diversified and longer-term transactions in Latin America and the Caribbean.

Carlos Perez, senior vice president in charge of CoreStates' operations in Latin America and the Caribbean, said the Philadelphia-based regional bank has been gradually extending working capital loans and medium-term credits to Latin American banks.

"We're going beyond short-term trade finance and diversifying a small percentage of our portfolio into nontrade transactions," Mr. Perez said.

He added that CoreStates is proceeding cautiously, but is convinced that economic conditions in Latin America have improved considerably over the last few years.

"It represents an evolution but it reflects the fact that the region has gotten much better." Mr. Perez said.

Higher spreads on longer-term loans, combined with the need to keep pace with other institutions, propelled CoreStates into extending maturities of its loans, he said.

"Other banks are offering broader types of credit, and we need to defend our market position," Mr. Perez said.

Latin America and the Caribbean have become two of the fastest-growing areas of business for CoreStates, which is heavily involved in trade finance, structured trade, foreign exchange, and operating services such as letter-of-credit processing.

Mr. Perez declined to disclose exact figures, but estimated that CoreStates' revenues from transactions with banks in the region are growing around 50% annually.

"This is definitely a promising region for CoreStates," Mr. Perez said. He added that although demand for credit from Mexico still remains "in the doldrums," the volume of business with Brazil, Chile, Colombia, and Caribbean countries is very strong.

CoreStates works with some 250 banks in Latin America and the Caribbean and last summer opened an Edge Act branch in Miami. As an Edge Act office, the branch can do business with banks or other entities outside the United States but cannot take deposits or solicit business in the United States.

CoreStates' first unit to handle overseas banking transactions opened in New York in 1967.

Its two other such offices are in Houston and Los Angeles. In Latin America, CoreStates also maintains representative offices in Bogota, Colombia; Buenos Aires; Mexico City; Panama City; Santiago, Chile; and Sao Paulo, Brazil.

Mr. Perez noted that the surge in CoreStates' Latin America business comes after a decade-long retreat from the area in the wake of the 1980s debt crisis.

"We're rebuilding, reentering, and reasserting ourselves in old markets," the banker said.

The bank prefers using representative offices in Latin America because it does not compete for corporate banking business with local banks, he said.

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