State-owned Bank of Brazil announced that it has regained market leadership, after posting a net profit of 4 billion reais (US$ 2.1 billion) in the first half of 2009, representing growth of 0.6% in comparison with the same period last year.
In the second quarter, the bank posted profit of 2.3 billion reais (US$ 1.2 billion), growth of 41% over the first quarter of 2009 and 42.8% higher than in the second quarter of 2008. The bank had lost its leadership to Itaú Unibanco, when Itaú and Unibanco consolidated their operations last year.
According to the chairman of the Bank of Brazil, Aldemir Bendini, the result is a consequence of credit expansion, given that total financial revenues reached 31.3 billion reais (US$ 17 billion) in the first half (41.7% higher than in the same period last year).
From that total, 19.1 billion reais (US$ 10.4 billion) resulted from credit operations, 32.5% more than in the first half of 2008.
The figures indicate that the supply of credit to natural persons increased by approximately 70% over the course of 12 months, having totaled 68.5 billion reais (US$ 37.3 billion). Lines of credit to consumers, the highlight being consigned credit, totaled 29.5 billion reais (US$ 16 billion), equivalent to a market share of 32.6%.
With regard to real estate credit, the Bank of Brazil financed 1.1 billion reais (US$ 600 million). Credit granted to companies totaled 103.3 billion, representing growth of 32% over the 12-month period. The portfolio of financing for agribusiness totaled 67.6 billion reais (US$ 36.8 billion), growth of 9.7% in 12 months. The figure is equivalent to 62.7% of total credit for agribusiness in the country.
To Bendini, the bank was right not being intimidated by the scarcity of credit on the market, and thus it collaborated to unlock credit in the country. Thus, the Bank of Brazil played an inducing role to the economy and development, and also induced the remaining banks, in the opinion of its chairman.
"The Bank of Brazil adopted a correct strategy by giving the country the benefit of doubt, by promoting the unlocking of credit with responsibility, in accordance with best banking practices." Bendini said that according to estimates, credit should grow from 13% to 17% in 2009.
According to him, the Bank of Brazil's insolvency rate, which is 3.3% for operations expired more than 90 days ago, is lower than the rate recorded by the National Financial System (SFN), which was 4.4% during the period.
"The trend is for insolvency to decrease. We believe that there will be a slight reduction in the third quarter, and a stronger one in the fourth, ending the year with a very expressive reduction," estimated Bendini.