Canadian lender Scotiabank has made a $2.2bn offer to acuire a 68.19% stake in BBVA Chile.

BBVA Chile has 127 branches, around CAD29bn in assets, and 4,000 staff.

“This transaction is in line with Scotiabank’s strategy to increase scale within the Chilean banking sector and the Pacific Alliance countries,” Scotiabank said in a statement.

Scotiabank also said that BBVA would accept the offer if its minority partner, which owns 31.62% of the Chilean unit, does not exercise its right of first refusal. The family also has the right to sell its shares of BBVA Chile to Scotiabank on the same terms.

The deal, if materializes, will make Scotiabank the third largest non-state owned bank in Chile and double its market share in Chile to around 14%.

Scotiabank also expects the deal to boost its common equity tier 1 capital ratio by around 100 basis points.

The news comes as Scotiabank posted net income of CAD2.07bn ($1.6bn) for the fourth quarter of fiscal year 2017, a rise of 3% compared to CAD2.01bn ($1.5bn) in the same period last year.

The banking group’s total revenue for the quarter ended 31 October 2017 stood at CAD6.81bn, up 1% from CAD6.75bn in the corresponding quarter of 2016.

Net interest income increased 5% to CAD3.83bn from CAD3.65bn last year, while non-interest income dropped 4% year-on-year to CAD2.98bn.

Provision for credit losses during the quarter was CAD536m, down 2% from CAD550m in the previous year. The group’s return on equity at the end of October 2017 was 14.6%.

Scotiabank president and CEO Brian Porter said: “During 2017, we delivered strong results in all three of our businesses. As well, the Bank is making good progress on its digital strategy, with our Digital Factory Network fully operational across our five key markets of Canada, Mexico, Peru, Chile and Colombia to collaborate, innovate and strengthen our customer experience and efficiency levels.”