The Brazilian Development Bank
BNDES
Brazil-Germany Conference on Infrastructure
and Logistic Investments
Demian Fiocca
Vice President – BNDES - Frankfurt – January 2006
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Highlights of BNDES
ƒ
Created June 20, 1952
ƒ
100% owned by the Federal Government
ƒ
Key instrument for implementation of Federal
Government industrial and infrastructure policies
ƒ
Main provider of long-term financing in Brazil
ƒ
Brazilian Export Bank
ƒ
Equity investor through BNDESPAR
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Financial and Economic Indicators
US$ million
Key Financial Data
Net Assets
Shareholders’ Equity
Net Income
Disbursements
Capitalization
ROA
ROE
Non performing Loans
World
Bank
BNDES
IDB
(31/12/04)
(31/12/04)
(31/12/04)
67,346
18,511
1,176
3,768
229,213
35,463
(2,404)
10,024
24.56%
3.57%
15.33%
0.47%
15.47%
-1.04%
3.36%
0.59%
52,653
4,450
337
13,748
8,45%
0.71%
8.23%
3.00%*
* 5 years average:0,6%
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BNDES - Organizational Chart
Board of Directors
Basic Industry
President
Vice-President
Guido Mantega
Demian Fiocca
Controlling
Infrastructure
Director 1
Antônio B. Castro
Director 2
Armando Mariante
Planning
Industrial
Foreign Trade
Director 3
Maurício Lemos
Social Inclusion
Indirect
Operations
Director 4
José Fiorêncio
Director 5
Carlos Kawall
Credit
Financial
Capital Markets
Administration
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BNDES Funding
FAT - Workers Assistance Fund
ƒ Government-established fund composed of compulsory
contributions deduced from net operating revenues
ƒ Permanent financing (quasi-equity)
ƒ Independent of Federal Budget
ƒ Remunerated at TJLP (Long Term Interest Rate)
ƒ At least 40% of annual revenues of FAT are transferred
to the BNDES (Constitutional FAT)
Foreign Funding
ƒ Government Agencies and Multilateral Institutions: IDB,
JBIC, World Bank, KfW etc.
ƒ Bonds, Loans, Structured Notes (ABS)
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Disbursements
19,618
US$ MILLION
13,748
12,813
11,721
10,892
2001
2002
2003
2004
2005
Converted to US$ on disbursement dates
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BNDES Disbursements by Company Size
US$ million
Year: 2005
8,1%
1,594
8,4%
1,654
1,556
7,9%
14,770
75,5%
Converted to US$ on disbursement dates
Individuals
Micro and Small
Medium
Large
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BNDES Disbursements by Company Size
Number of Operations:
Year:
US$2005
million
Year: 2005
7,1%
8,391
8,4%
9,938
29,312
70,966
24,7%
59,8%
Individuals
Micro and Sm all
Medium
Large
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BNDES Disbursements According to Sectors of Activity
30%
35%
11%
12%
7%
7%
30%
38%
14%
8%
36%
9%
17%
5%
5%
52%
2001
Industry
50%
46%
48%
40%
2002
2003
2004
Trade and Services
Agriculture
2005
Infrastructure
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B N D ES: Infrastructure Disburse m ents
3,921
US$ million
3,509
616
85
142
2,822
303
632
211
2,214
2,032
544
338
194
115
70
150
1.279
411
1.186
445
2.768
1.673
424
1.252
1.149
129
382
2001
2002
Electric Energy
2003
Oil and gas
Logistics
2004
Telecommunications
2005
Equities
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B N D ES Infrastructure Area
CREDIT LINES:
Power Generation (Hydro and Thermo)
Transmission Lines
Distribution Utilities
Oil and Natural Gas (upstream and downstream)
Renewable Energy Sources
Railways
Roads
Ports
Acquisition of Airplanes, Locomotives, Wagons
Telecommunications
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B N D ES Credit Policy and Modus Operandi
™ Credit and Eligibility Co m mittee
™ No foreign capital discrimination
™ Allloans require collateral and repayment
capacity
™ Lending directly or through financial
intermediaries (totalling 84 banks in 2005),
which bearthe final creditrisk.
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B N D ES Interest Rate
Final rate
Financial cost
+ Basic spread
+
Risk spread
BNDES Financial Cost: TJLP ( Long-Term Interest Rate)
Basic spread: from 0% to 3% per year
Risk spread: from 0.8% to 1.8% per year (direct operations)
or 0.5% financial institutions spread (on lending operations)
Amortization Schedule:
Schedule 5 to 15 years;
Collaterals:
Collaterals
ƒ
Pledge on company´s shares; Concession Rights Pledge;
Company receivables; Corporate or Banking Guarantees;
Mortgage.
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B N D ES Interest Rate
Funding to projects with revenues on
foreign currency:
•85% TJLP
•15% Currency Basket (Average Cost of
funding on Foreign Currency)
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Flow of Direct Operations
Consultation
Letter
(all eligible
companies according
to public operational
policies)
Eligibility
analysis
Project
Analysis
Approval
(Senior Technical
Committee)
(Technical
Staff)
(Board of Directors)
Contracting
Disbursements
The consultation-letter is the first step to obtain a financing with
BNDES.
It specifies the basic characteristics of the company and project,
necessary for the framing of the operations with the Operational
Policies of BNDES.
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B N D ES Credit Policy: Autom atic Operations
Financing of projects up to US$ 4,3 million
A GENT
Evaluates project feasibility
B N DES
Approval
A GENT
Contracts
B N DES
Disburse ment
Financing sub mitted to
the financial agent
CLIENT
Implem ents project
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BNDES and the Credit Market
BNDES disbursements have an anti-cyclical component.
22%
22%
20%
18%
Source: Brazilian Central Bank
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Long Term Interest Rate (TJLP)
Long Term Interest Rate in real terms
40
TJLP, COUNTRY RISK AND INFLATION (IPCA)
35
30
25
20
15
10
5
EMBI+IPCA
2,7
TJLP
TJLP/IPCA
0
1995 1996 1996 1997 1998 1998 1999 2000 2000 2001 2002 2002 2003 2004 2004 2005
07
03
11
07
03
11
07
03
11
07
03
11
07
03
11
07
Source: Brazilian Central Bank
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The Brazilian Development Bank
www.bndes.gov.br/english
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