(Reuters) – Bancolombia SA, Colombia’s largest lender by assets, agreed to purchase HSBC Bank SA Panama for $2.1 billion, the company told local regulators on Tuesday, the latest in an expansion wave by Colombian banks in Latin America.

The acquisition includes HSBC Panama’s brokerage, fiduciary services unit, banking business and its insurance company.

Even as Colombia’s economy begins to slow, its banking sector remains robust and has expanded internationally in the last few years, demonstrating the sector’s increased clout in the region after Colombia was awarded investment grade in 2011.

Last year, Banco GNB Sudameris agreed to buy HSBC’s units in Colombia, Peru, Paraguay and Uruguay for $400 million, while Banco Davivienda agreed to acquire HSBC assets in Costa Rica, El Salvador and Honduras for $801 million.

“The transaction is aligned with Bancolombia’s strategy to expand its international operations by investing in the growing, solid and profitable market of Panama, where it has been present for over 40 years,” Bancolombia said in a statement.

The Bancolombia agreement does not include HSBC Panama’s units in Colombia, which are being sold to another company in a different transaction, it said. The transaction is expected to close during the third quarter of 2013, subject to regulatory approvals, Bancolombia said in a statement.

Bancolombia Chief Executive Carlos Raul Yepes told Reuters last year he was on the lookout for acquisitions in the Latin American region, with a focus on fiduciary funds and brokerages.

“This doesn’t end. We have to keep seeing where there are growth opportunities,” Yepes told reporters on Tuesday. “We are always looking.”

He said the company is paying for the acquisition in cash and will not need to issue debt. “We have capital and we have liquidity, our levels of solvency are well above the requirements,” he said.

As Colombia slowly emerges from half a century of war, foreign investors are flooding its financial sector to tap into the new stability, growing numbers of banking clients and increasing consumer spending.

That confidence has brought a slew of new middle class customers to Colombian banks and helped spark record profits for the sector in recent years.

HSBC Panama had about $5.7 billion of loans outstanding and $5.8 billion of deposits at the end of September. Parent HSBC Holdings Plc is based in London.

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