Brazil's BNDES (Banco Nacional de Desenvolvimento Econômico e Social – National Bank for Economic and Social Development) posted net profit of 4.1 billion Brazilian reais (US$ 2.5 billion) in the first half of 2008. It was the second highest profit for a six-month period in the history of the bank.
The highest profit to date, of 4.4 billion reais (US$ 2.7 billion), was recorded in the first half last year. The figures were disclosed by the press office of the bank.
The head of the Accountancy Department at the BNDES, Vânia Borgerth, stated that the result in the first half of 2007 "was impacted by two extraordinary events." The bank had anticipated settlement of export financing contracts, which generated revenues of 650 million reais (US$ 401.1 billion), and also had a credit recovery, which led to a reversal of provision of 1.2 billion reais (US$ 740.5 million).
"This year, we also had a credit recovery, but it totaled to only 415 million reais (US$ 256.1 million)."
According to Vânia, accumulated profit in the first half this year was influenced by the result of the equity portfolio of subsidiary BNDES Shares (BNDESPar).
"The BNDES seized some good moments in the market, made some disposals, received dividends and interest on the capital of the companies it invests in. All of that, coupled with the equity pick-up result, led the partnership portfolio result to contribute significantly to the overall result that we achieved."
Equity contributions reached 4.8 billion reais (US$ 2.9 billion), representing growth of 111.7% over the first half last year. Due to the high quality of the financing portfolio, the insolvency rates of BNDES were quite modest.
"The bank never had such low insolvency rates. They answered to only 0.02% of the total financing portfolio, which totals 182 billion reais (US$ 112.3 billion). This is the lowest insolvency rate we have ever had," he said.
BNDES' net assets at the end of the first half this year stood at 28.8 billion reais (US$ 17.7 billion). Under the regulations of the Central Bank of Brazil, the result raises the bank's reference equity up to 47.8 billion reais (US$ 29.4 billion), as against 41.5 billion reais (US$ 25.6 billion) in 2007.
Total assets of the BNDES system reached 222.8 billion reais (US$ 137.4 billion) in June this year. The figure represents growth of 9.9% over the result recorded in December last year.