CADE requests more information about Itaú's purchase of XP.

SAO PAULO (Reuters) - Brazil's Administrative Council for Economic Defense (Cade) deemed Itaú Unibanco's acquisition of brokerage firm XP Investimentos complex and requested additional information, according to a decision published in the Official Gazette of the Union this Monday.

The General Superintendence of CADE (Brazil's antitrust authority) assessed that the transaction will generate horizontal overlap in the activities of securities brokerage, administration and management of third-party resources, and distribution of investment products to clients, among other aspects that may affect competition in the sector.

"Therefore, in order to better analyze the competitive dynamics of the market and the conditions of rivalry in the markets affected by the operation, it is necessary to carry out further investigations in order to deepen the analysis of the case and give the parties the opportunity to present the efficiencies resulting from the operation, which could counterbalance such concentration," the superintendency said in a statement.

In May, Itaú announced an agreement to acquire a 49,9 percent stake in XP Investimentos for 6,3 billion reais. The agreement also stipulated that the bank could increase its stake in the brokerage firm to 74,9 percent by 2022.

At 10:44 AM, Itaú Unibanco shares were showing a positive fluctuation of 0,09 percent, while the Ibovespa was up 0,3 percent.