Apr 15, 2013

• The result was boosted by capital goods and indicates a recovery in investment
• Releases for micro, small and medium-sized companies broke records

Disbursements from the Brazilian Development Bank (BNDES) totaled R$ 37.2 billion in the first quarter of 2013, an upsurge of 52% if compared to the same period in 2012.

The level of disbursements is the highest in the BNDES’ history for the first quarter and indicates a significant recovery in investments, with an emphasis on the releases earmarked for machinery and equipment, as well as the industrial sector. The pace of the BNDES’ approvals is in keeping with the recovery in business activity, with a total of R$ 40.7 billion and up 51%. Disbursements to micro, small and medium-sized companies were another high point in the period, which have collectively set a record
of R$ 15.1 billion, up 50% for the first three months of 2012.

Industry accounted for 36% (R$ 13.5 billion) of total disbursements, with a significant increase of 109%. All industrial segments had positive results between January and March this year, especially machinery and equipment. The BNDES' automatic releases through Finame reached R$ 16.3 billion, with up 70%.

Of this total, R$ 4.8 billion was earmarked for "non-transport equipment", that is, industrial machinery directly connected to investment aimed at expanding the production capacity and modernizing.

This category of capital goods showed a 90% increase in disbursements if compared to January-March 2012. In this increase, there are segments that are fundamental to the industrial expansion, which boosted investments in boiler machinery (596%), machine tools (135%) and cargo handling machinery (115%). For transportation equipment, where buses and trucks are included, the BNDES released R$ 8 billion in the first quarter of 2013, an upsurge of 44%.

Disbursements for farming equipment (tractors, tools and harvesters, among others), which were boosted by a record grain harves, grew 129%, totaling R$ 3.6 billion.

The significant disbursements for capital goods show the scope and importance of PSI (Investment Maintenance Program), which offers lower rates to purchase machinery and equipment. PSI disbursements totaled R$20.2 billion in the first quarter, contributing to the increased competitiveness of the domestic industry. Eligibility and consultations ended the quarter with a drop of 12% and 11% respectively. The figures, however, do not suggest the business community is less willing to invest, because they (the figures) were strongly influenced by a single operation: a credit limit of R$ 9.4 billion to Petrobras, which was placed under consultation and eligibility at the BNDES in the first quarter of 2012.

The sectorial performance analysis carried out by the BNDES reveals that, in January-March 2012, the releases for infrastructure reached R$ 9.3 billion. The figure shows a drop of 7% in relation to 2012, but the trend in the sector is to grow, as approvals soared R$ 15 billion, up 73%. The rail and road transport segments made important contributions to this result.

For trade and services, the BNDES released R$ 9.7 billion (up 65%) and approved R$ 10.8 billion (up 34%). For agriculture, releases were R$ 4.7 billion, growth of 113%, in relation to January-March 2012. Industry approvals were R$ 3.6 billion (an expansion of 63%).