Nov 13, 2015

• A 0.02% default rate is the lowest in the National Financial System, which demonstrates the high quality of the Bank’s credit portfolio

The Brazilian Development Bank (BNDES) recorded a net profit of R$ 6.639 billion in the first nine months of 2015. The main positive factor was the increase in financial intermediation, reaching R$ 14.515 billion, some 52.9% above that recorded in the same period in 2014. Another positive indicator was the BNDES’ low default rate, 0.02%, in the period. This is considerably below the 3.1% average in the National Financial System (SFN), which demonstrates the high quality of the Bank’s credit portfolio.

The significant increase in the results from financial intermediation reflects not only growth in the credit portfolio, but also the revision of spreads in the last few years. The management skills of the Bank’s treasury also had a positive impact on the performance, which ensured enough profitability to keep rates consistent. This allowed long-term financing operations and also offset any oscillations in variable income.

In the third quarter of the year, the BNDES profit amounted to R$ 3.124 billion, some 62% higher than the same period in 2014, which was R$ 1.928 billion. This also reflected better financial intermediation results. Results between January and September were 10.3% lower than the R$ 7.399 billion recorded in the same period in 2014. The reduction was affected by results in corporate stakes, which registered a drop of R$ 5.4 billion when comparing both periods, mostly due to the strong depreciation in the capital market.

Profitability on equity was 15.45% on September 30, and the Basel index reached 14.7%, a conformable situation against the 11.0% that the Central Bank requires.

For the BNDES, it is highly important to ensure the quality of its credit portfolio, considering that, more than just a public bank, the returns on its operations represent the main source of funding to provide financing to new investment projects. In the first nine months of 2014, such returns represented 95.8% of the resources disbursed in the period. The percentage of renegotiated credits was only 1.88% of the total portfolios on September 30 2015.

Falling results from corporate takes, at R$ 5.450 billion, were caused by factors beyond the scope of the BNDES’ management, basically due to two events: an expressive reduction in the volume of dividends paid by companies in the share portfolio, totaling R$ 2.347 billion; and an increase in provisions for losses (impairment) totaling R$ 2.794 billion, following the drop in the Stock Exchange index.

Financial position –The BNDES System’ net worth totaled R$ 33.8 billion in September 2015, exceeding the R$ 30.7 billion in December 2014. This increase was influenced by the result in the period of R$ 6.6 billion, offset by the loss of value in the share market and in non-colligated companies (R$ 5.4 billion, net after tax). Reference equity (a regulatory basis that determines a company’s financing capacity) reached R$ 98.8 billion in September, exceeding the R$ 97.9 billion from last year.

BNDESPAR – In the third quarter of 2015, BNDESPAR’s profit reached R$ 1.314 billion, exceeding the R$ 467.986 million in the same period of 2014. In the first nine months of the year, the result was down some R$ 96 million, showing signs of recovery from the loss of R$ 1.410 billion in the first half of the year. In 2014, between January and September, BNDESPAR recorded profit of R$ 2.616 billion.

The BNDES’ detailed financial statements and BNDESPAR’s Quarterly Information are available here.