By Tatiana Bautzer and Carolina Mandl
SAO PAULO (Reuters) - Andre Laloni, a veteran of investment banks from Goldman Sachs & Co to UBS Group AG, seemed like an unlikely pick to become chief financial officer of Brazilian state bank Caixa Economica Federal, long a sleepy mortgage underwriter.
Yet in just a few months the 46-year-old banker has made Caixa the talk of Faria Lima Avenue, the epicenter of Sao Paulo's dealmaking scene.
The sudden prominence of the Caixa investment banking unit that Laloni started from scratch highlights how dramatically President Jair Bolsonaro is shaking up Brazil's vast state-run banking apparatus.
Caixa has taken the lead among state-controlled banks under pressure to sell assets and return funds to the government, doing deals at a faster pace than both larger listed peer Banco do Brasil SA and development bank BNDES.
Laloni is juggling a dozen deals, including share offerings of stakes the bank owns or manages in other companies, as well as potential M&A or IPOs for its own subsidiaries.
What convinced the banker to take his first-ever public sector job was the mission of scaling back Brazil's bloated bureaucracy, he said.
"We know we're all here for a limited period of time, but what attracted us to this job is the idea of a legacy," Laloni said in a recent interview at a Sao Paulo steakhouse.
To handle the deals plus his CFO tasks, Laloni works up to 16 hours a day and most of his weekends. Some Caixa workers unaccustomed to the long hours asked to leave the investment banking division, he said, while downplaying the idea of a culture clash.
So far this year, Laloni has managed 10 billion reais ($2.6 billion) in offerings of the bank's stakes in reinsurer IRB Brasil Resseguros SA and oil firm Petroleo Brasileiro SA. That equals 37% of all share offerings in Brazil, Latin America's largest stock market, this year through June 26, according to Refinitiv data.
Laloni expects the total to reach 15 billion reais by the end of July, with planned sales of Caixa's stakes in Banco do Brasil and power holding company Alupar Investimento SA.
In the second half of the year, Laloni, who has an MBA from the University of Virginia, expects to focus on deals involving the bank's divisions such as insurer Caixa Seguridade, aiming to strike partnerships ahead of an IPO. The deals could double the amount raised to 30 billion reais by year-end, he estimates.
Caixa's proceeds from the asset sales will go to repaying loans owed to the Brazilian Treasury.
RISING IN RANKING
Caixa's divestitures may for the first time give the bank a toehold in Brazil's investment banking league table, a ranking of advisers on M&A and equity deals. It has already risen to fifth place in the equities ranking.
Laloni's newly assembled team has 30 members, with five from other banks including Barclays, where he spent six years as a director. The rest were recruited internally, as Caixa has restrictions on hires that do not go through a mandatory state workers' exam.
After starting his career in UBS's New York office, Laloni jumped to Brazil's Itau Unibanco, then to Goldman Sachs and Barclays in Sao Paulo. UBS then hired him as head of Brazil and Southern Cone investment banking, but he left to take a sabbatical in late 2016 in what the bank called a "mutual decision."
In February, Caixa Chief Executive Pedro Guimaraes, another veteran banker who had worked with Laloni on deals, recruited him to bring private-sector dealmaking skills to the bank.
Although there is no plan to list Caixa itself, it began reporting earnings this year as if it were publicly traded.
"I want Caixa to be transparent, we'll have listed subsidiaries," Laloni explained.
In the near future, Caixa is also mulling sales of its stakes in lender Banco Pan SA and potential IPOs of companies part-owned by a fund the state bank manages, such as sanitation firm Brookfield Ambiental and logistics firm VLI SA.
Laloni also hopes to grab some mandates advising the economy ministry on other state firms' privatizations in coming years.
To further expand the investment banking unit, he aims to start offering domestic mid-sized companies an opportunity to sell bonds in Brazil's growing fixed income market.
"Changing a country's culture is never easy," he told institutional investors during a recent visit to New York. "But we are very focused and moving on."
($1 = 3.8468 reais)
(Reporting by Tatiana Bautzer and Carolina Mandl; Editing by Christian Plumb and Tom Brown)