The new administration of Brazilian President Jair Bolsonaro will end “distortions” in the nation’s credit system by reducing the weight of public banks, redirecting credit to consumers and fostering more capital market financing of economic development, Economy Minister Paulo Guedes said Monday. Guedes spoke at the inauguration of new presidents of three major government-run financial institutions—the Banco do Brasil (BB), the Brazilian Development Bank (BNDES) and the Federal Mortgage Bank (CEF). He said, “Under previous administrations, the role of the public banks was distorted. The CEF’s resources were assaulted and looted. Lending by public banks depended on political alliances and personal connections.” Guedes said the new administration intends to shift lending priorities toward consumers, creating more room for capital markets to finance business development and even infrastructure projects.
Link to government news agency report