January 8, 2018 / 10:05 AM / a year ago

Brazil's BNDES plans to repay $40 billion to the Treasury in 2018

SAO PAULO, Jan 8 (Reuters) - Brazil’s state development bank BNDES plans to repay 130 billion reais ($40 billion) in loans to the Treasury this year, Carlos Thadeu de Freitas, its chief financial officer, was quoted as saying in the Monday edition of newspaper Valor Econômico.

The money may be returned only in the second half of the year when the outlook will be clearer for disbursements from the bank, Brazil’s main source of long-term corporate lending, Freitas said.

The amount being repaid to the Treasury in 2018 may be affected if BNDES is also obliged to transfer cash belonging to FAT, a workers’ support fund, Valor wrote, citing Freitas.

Bank press representatives did not immediately reply to a request for comment.

Between 2008 and 2015, the Brazilian Treasury transferred more than 500 billion reais to the development bank, weakening public finances and squeezing commercial lenders out of capital markets.

Under the original term of the transactions, the loans would have to be paid back in up to 30 years, Valor reported. ($1 = 3.2288 reais) (Reporting by Ana Mano; Editing by Peter Graff)

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