BNDES may return $ 100bn to government in 2019, says councilor – 06/21/2019 – Market



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The National Bank for Economic and Social Development (BNDES) could return to the National Treasury about $ 100 billion this year to help with government accounts, according to bank adviser Carlos Thadeu de Freitas.

The bank has already returned this year about R $ 30 billion and, according to the adviser, the remaining R $ 70 billion should be paid by the end of the year. Thadeu, who previously served as director of the institution, said the bank has the space and the wind to return the amount to the Treasury to help with the public accounts.

"The public accounts can not get any worse. Everyone's in the same boat, and if it gets worse, everybody sinks together," he said.

During the last decade, the Treasury has irrigated the BNDES with almost R $ 500 billion, used for loans to companies, often cheaper than the cost of funding from the Union. These resources have started to be returned in recent years.

From 2015 to 2018, the bank returned to the government R $ 309 billion. Last year, BNDES made an agreement with the Union, anticipating from 2060 to 2040 the deadline for returns.

Inside the bank, Joaquim Levy, who resigned from the bank's command last weekend after being publicly charged by President Jair Bolsonaro, said he would be resisting a more meaningful return.

"Levy is a great economist, but maybe it took him a while to figure out the new size of the bank," Freitas said.

There are fears in the bank that discards could compromise the institution's ability to finance. But as the economy has not yet moved, there are currents in the government that understand that the devolution would not have major consequences for the BNDES.

The opinion of the pension reform provides for the end of onlendings of the Workers' Assistance Fund (FAT), one of the bank's main sources of financing.

"If this is approved, it would only be for 2020. Then you have to see how the remaining resources will be returned. A total of R $ 200 billion is missing," said Thadeu.

The executive said that one should no longer expect the bank to lend more than R $ 70 billion annually. BNDES has already lent more than R $ 140 billion per year. The focus from now on should be financing for infrastructure works and for medium, micro and small businesses, he said.

"There is no alternative for the bank to be bigger, the private ones can lend, they are very liquid and it does not make sense to have a huge BNDES, if it has to be focused on small and infrastructure," says Thadeu.

The executive forecast is that BNDES will lend in 2019 about R $ 65 billion, below the R $ 69.3 billion in 2018.

With this, Freitas said it is time to think about wiping out the workforce through a Voluntary Dismissal Program (PDV). This could take the total number of BNDES, currently around 2,500 people, to a maximum of 1,800 employees.

The BNDES employees' association said that for the time being is not aware of a POS and that it would not manifest itself.

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