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MEXICO CITY - Bank of Montreal has been excluded from the board of Mexico's Grupo BBVA-Bancomer, signaling that the Canadian institution is preparing to divest its minority stake in Mexico's top financial services company.

Spain's Banco Bilbao Vizcaya Argentaria SA said Friday that the bank's co-chairmen, Emilio Ybarra and Francisco Gonzalez, will be board members of BBVA-Bancomer. No representatives from the Canadian bank were included in the board of the new company.

BBVA's local unit, Grupo Financiero BBV-Probursa, is merging with Grupo Financiero Bancomer SA, a pairing that will create Latin America's largest bank, with close to $40 billion of assets.

Bank of Montreal, one of Canada's top six banks, owns a 16% equity stake in Bancomer and a 20% voting interest. Three Bank of Montreal representatives on Bancomer's 15-member board voted in June in favor of a Bancomer merger with the Spanish bank.

The merger will dilute Bank of Montreal's stake to about 10%, but the Canadian bank decided not to increase its investment to offset the dilution, because of competing strategic priorities.

Bank of Montreal has said it will seek to redirect its investment out of Bancomer into other opportunities, including a joint venture between BBVA-Bancomer and Bank of Montreal's Chicago-based unit Harris Bank for the booming U.S. Hispanic market.

Bank of Montreal officials did not return calls seeking comment. People familiar with the situation said the Canadian bank is waiting for an improvement in Bancomer's share prices or negotiating a sale price with BBVA.

Bank of Montreal acquired its minority stake in Bancomer in 1996 for about $450 million.

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