With this proposal, the government will offer guarantees for up to R $ 5. 000 million (about U.S. $ 2. 200 million) on certificates of deposits for banks, thus stimulating the generation of credit. This measure also improves the competitive position of small and medium-sized entities more effort forcing big banks to fight their market space. One of the factors hindering the growth of credit to the private sector is the high rate differential exists, which has risen in 2008 to strong result of the international financial crisis. Although during the month of February, bank spreads, ie the relationship between funding costs and the fees charged to customers, fell to 29.7 percentage points from 30.5 percentage points in January, them are at a level too high causing a great deal of potential loan applicants are automatically excluded. The current situation makes profitable investment projects but with low risk (and of course, with low profitability), can not carry out their investments as the high financial cost makes it not profitable.
The Central Bank of Brazil is looking for this differential shrink rates and according to it, announced that he will present today in a series of proposals to the National Monetary Council. These measures include a Positive Cadastre, which will allow clientesa take your credit history of a banking institution to another and get better conditions credit (increasing competition and reducing the cost of credit rating). a From the Brazilian business community has requested the government to reduce the tax burden affecting the banking spread. With these initiatives for the Brazilian banking sector, increase the prospects for growth. This year, the Brazilian Central Bank predicts a growth of volume of credit of 14%, a level acceptable considering the external environment of instability, its impact on the Brazilian economy and the fact that growth rates and expected inflation mean that the produce the same credit growth in terms of GDP. For private banks in Brazil (and especially for larger entities), the initiatives carried out by the Brazilian government increased the challenges of 2009. The struggle to gain share in the banking market will be very tough in a context where the effects of external shock will act as an obstacle to the dynamic credit.
Public banks holding 50% of the stock lending system Brazilian banking. This coupled with the low level of credit to existing and potential GDP impact of government measures to reduce the cost of credit that private banks do have a potential for expansion rather than attractive. And while in developed economies the banking sector struggles to survive new episodes of crisis in Brazil is time of growth and consolidation of the Brazilian banks Will take this opportunity? Latinforme. com is the main source of financial information and independent opinion on American and global markets from a Latin American perspective. From our offices in Buenos Aires, Argentina, I approached the latest news and alerts to help you make gains regardless of the direction taken by the market.