Fitch Publishes Brazilian Lending Trends Report

RIO DE JANEIRO--(BUSINESS WIRE)-- Fitch Ratings has published its special report '2016 Brazilian Lending Trends: Bleak Environment for Loan Recovery'.

The Brazilian government's policy to boost economic growth through lending showed signs of wearing out in 2015. Following a decade of 20% annual loan growth, in 2015 there was a marked slowdown in both financial institutions' appetites to originate new loans and in companies and consumers' demand for borrowing. As a result, outstanding loans in the financial system grew by a meager 6.6%, which was well below annual inflation of 10.67%.

The significant slowdown in economic activity, a fall in disposable income, increasing unemployment and inflation, local currency devaluation, as well as the implications of investigations in progress, especially the Lava Jato operation, contributed to the increase in non-performing loans (NPLs: delinquency over 90 days) in 2015. NPLs in the Brazilian financial system rose in a meaningful way in 2015, increasing from 2.7% of total loans in December 2014 to 3.5% in December 2015. In Fitch's opinion, NPLs will continue to increase in 2016.

Given their countercyclical policy roles - in addition to the possibility of political interference - it is expected that public banks will continue to present loan growth above that of the private banks. More conservative in comparison with public banks, large private banks have worked more with distressed loans' recovery and have presented better provisioning standards compared with public banks.

Fitch expects loan growth to remain low, between 4%-7%, due to the challenging economic conditions, modest loan demand, and low risk appetite from banks.

The complete report is available at 'www.fitchratings.com' and 'www.fitchratings.com.br' or by clicking on the link.

Additional information is available at 'www.fitchratings.com'.

2016 Brazilian Lending Trends (Bleak Environment for Loan Recovery)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=878130

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

View source version on businesswire.com: http://www.businesswire.com/news/home/20160314005891/en/

Fitch Ratings
Pedro Carvalho
Analyst
+55 21 4503-2602
Fitch Ratings Brasil Ltda
Praca XV de Novembro 20, 401B - Rio de Janeiro - RJ CEP 20010-010
or
Esin Celasun
Director
+55 21 4503-2626
or
Claudio Gallina
Senior Director
+55 11 4504-2216
or
Media Relations:
Elizabeth Fogerty, +1 212-908-0526
[email protected]

Source: Fitch Ratings

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• Robo.ai Announces Core Executive Appointments, Forming a Local UAE Leadership Team at Neurovia AI
• Grupo Aeroportuario Del Pacifico Announces Results for the Second Quarter of 2026
• Best Crypto to Buy Today: A Look at Solana, Chainlink, Sui, and BlockDAG’s Momentum