|
 Brazilian monetary authorities eased rules on reserve requirements that banks must keep at the Central Bank in a push to inject liquidity and preserve Brazil from the impacts of the United States financial crisis.
The Central Bank delayed the introduction of higher rates for mandatory deposits from leasing companies by two months and raised the threshold on exemptions for cash, time and savings deposits, according to a Wednesday e-mailed statement.
The measures will add 13.2 billion reais (US$ 7.16 billion) to the financial system, the Central Bank said. The measures are geared to "preserve the financial system from the effects of liquidity restriction which has been observed in the international financial system," said the bank's release.
The measure reverses part of the Central bank's efforts to slow lending growth that's fueling domestic demand and stoking inflation. Policy makers began phasing in reserve requirements on cash deposits from lease underwriters for the first time in May, a move that would remove as much as 40 billion reais from credit markets. In Brazil, leases are commonly used as consumer loans.
Under the rules announced Wednesday, a reserve requirement of 20% of cash deposits from lease underwriters will take effect January 16, two months after the original schedule. The reserve requirement will increase to 25% in March, according to the Central bank.
Banks will only have to keep part of their cash, time and savings deposits at the Central bank if the reserve requirement exceeds 300 million reais, the Central bank said. Previously, this threshold was 100 million reais.
"This is positive for the banks because they will have more money available to lend in a moment when there's credit restrictions abroad," said Aloisio Lemos, an analyst at Agora Corretora in Rio de Janeiro. The higher thresholds will mainly benefit small and medium-sized banks, Lemos said.
Bank lending climbed 33% in the 12 months ended in July after a 27% expansion in 2007, the fastest in more than a decade. The Central bank is scheduled to release August figures on September 29.
This is not the first reaction to the US financial crisis. Last week the Brazilian government decided to "fortify" the country's Economic and Social Development, BNDES bank with the purpose of supporting Brazilian corporations that have loans from international banks and could not be able to renew them because of the current credit drought.
The first transfer of funds to BNDES totaled US$ 2.8 billion but the option remains open if Brazilian corporations "need to renew credits."
"Brazilian corporations are having problems to renew their credits with international financial institutions because of the crisis", admitted Mário Cypriano, CEO from Bradesco, the country's largest private bank.
Mercopress
 |
Subscribe to this comment's feed
The Largest Swindle in Global Economic History – September 24, 2008
SouthAmerica: It is underway in the United States the largest Swindle in global economic history.
The United States economy is becoming a case study for the largest economic swindle in world history.
It is laughable to watch a Republican administration that dismantled many of the regulations that helped create this massive mess in the US financial markets and refused to regulate a derivatives market that went from $ 900 billion dollars to $ 62 trillion dollars a market completely unregulated and that has been flying on automatic-pilot under their watch – a Republican administration that changed the rules on Federal Insured Pension Plans to supply more casino chips to the high rollers in Wall Street to gamble also with the pension money – it is fun to watch the Republican Party setting up the Democratic Party to be the politicians that are going to be blamed for the passage of the Mother Of All Bailouts in World History.
The Democrats are too stupid to realize that they are being set up to be the fall guy in the future. The Democrats were in control of Congress when this historic Pathetic bailout was passed on a Hurry, a real Hurry – the sky is falling type of environment - and no time to study what was really going on behind the scenes….
These scoundrels did show their hand when they published the first draft of this $ 700 billion dollars bailout as shown in a front page article published by The New York Times yesterday the article said: “The passage is stunning. “Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or administrative agency,” the original draft of the proposal bill says.
These scoundrels want to assign unlimited authority to a system that has fail badly and they don’t want any checks and balances attached to this bailout in the name of restoring confidence into the US financial system.
If Americans are so Dumb as to fall one more time to these scare tactics that the Bush administration has been using all along then Americans and the rest of the global financial system deserves to taken for another ride – only fools would fall for these empty scare tactics
I understand that common sense has been gone out of the window of the US financial system a long time ago – but it is getting to the point that is becoming laughable and Pathetic how these guys think that a $ 700 billion dollar bailout is going to fix the system when in reality is just going to supply more casino chips for the scoundrels to destroy the entire system even further.
The scoundrels don’t want to unload only their bad bets on the real estate market into the lap of the US taxpayers – they are lobbying very hard to dump all kinds of toxic waste into the US government garbage dump – the Federal Reserve and US Treasury.
The scoundrels want to unload a massive amount of losses related to the derivatives market that no one has any idea of how many trillions we are talking about since this market it is unregulated and nobody has a clue how much losses are already in the pipeline related to these off balance sheet financial weapon of mass destruction.
Americans are not smart enough to connect the dots and realize that by assuming these massive losses today in the trillions of US dollars indirectly they are helping to dismantle in the coming years all the unfunded social programs that we have here in the United States including Social Security, Medicare, Medicaid, the pension system of federal employees, and so on….
.