Category: Brazil

Brazil’s largest private bank, Banco Bradesco, has announced a year-on-year profits increase of 68% in the third quarter, as net income rose to $647 million. The rise is being attributed in large part to high interest rates and a growing demand for consumer credit.

Brazil’s currency, the real, closed on Friday at 2.212 to the US dollar, its highest rate in four-and-a-half years. Analysts expect the real to maintain its strength for the time being because of the high amount of dollars in the market. A further influx is expected with further bond issues in the pipeline.

Brazil’s largest fixed-line telecoms company, Telemar, is to issue $150 million bonds abroad. The bonds, which mature in 2011, are being issued in dollars but the offering includes an exchange rate mechanism which will be applied at maturity. The issue has been rated Ba1 by Moody’s Investors Service. The offering is being led by Citigroup.

Brazilian steel producer Grupo Gerdau has said it will invest $50 million over the next three years in its steel plants in Colombia to increase annual production there by 50% to 600,000 tonnes. Gerdau also has plants in Brazil, Argentina, Canada, Chile, US, and Uruguay.

Brazil’s largest bank, São Paulo-based Banco Itau, has announced a rise of 47% in profits in the third quarter. Net income rose to $601 million driven by increased consumer demand for credit and higher fees.

Brazil’s foreign trade surplus reached $36.35 billion as at end-October, surpassing last year’s record total of $33.70 billion. The total surplus for 2005 has now been projected to reach $38 billion.

Brazil’s debt as a percentage of GDP fell to 51.4% in September, down from 51.8% in August. The debt to GDP ratio is seen as an indicator of Brazil’s ability to pay its debt obligations. The strengthening local currency has allowed the country to reduce its foreign currency-denominated liabilities. The real has gained 17% so far this year.

Brazilian iron ore producer Companhia Vale do Rio Doce (CVRD) has sold $300 million of 30-year notes due in 2034. The notes were priced with a yield to maturity of 7.65% per year. The issue was twice oversubscribed. The offering is part of a series of notes that were issued in January 2004.

Spanish electricity group Endesa says it will invest $4 billion in Latin America. Endesa has interests in Chile, Argentina, Brazil, Peru and Colombia. A large part of the money invested will go towards expanding power plants in Chile.

Brazil’s IBGE statistics institute cut its forecast for the 2005 grain harvest by 5.4%. It said grain production this year will likely fall to 112.9 million tons. Brazil is the world’s second-largest soybean producer, but the IBGE expects soy production to drop 3.17% this year.