BNDES wants to pay less dividends, says Mercadante – 02/14/2023 – Market

The president of the BNDES (National Bank for Economic and Social Development), Aloizio Mercadante, defended this Tuesday (14th) in a meeting with the Minister of Finance, Fernando Haddad (PT), that the institution pay less dividends to the Union, as other public banks.

“We want equality in the payment of BNDES dividends with Banco do Brasil so that we, without needing Treasury resources [Nacional], have more own resources to apply. There is a strong demand for credit, especially cheaper credit for, for example, micro and small companies, clean energy and technological innovation,” he said.

According to the BNDES statute and internal rules, the dividend policy provides for the payment of up to 60% of profit to shareholders. The percentage, according to Mercadante, should be reduced. Today, Banco do Brasil pays 40% to its shareholders – including the Union as the majority shareholder.

“Historically, companies distribute 25%, the BNDES paid 25%. In the period when the BNDES had the TJLP [Taxa de Juros de Longo Prazo], received a lot of subsidies, they increased to 60%. But today the BNDES no longer receives subsidies from the Treasury, on the contrary, it has paid R$678 billion since 2015. We are ending this cycle. We are going for a balanced relationship between BNDES and the Treasury,” he said.

The TJLP was replaced by the TLP (Long-Term Rate) as the main benchmark for BNDES loans in financing agreements signed as of January 1, 2018.

At the meeting at the Ministry of Finance, changes in the TLP were also discussed. According to Mercadante, it is a “very volatile” rate, as it works with the month’s inflation. “It fluctuates a lot, it damages the predictability of companies a lot, especially for micro and small businessmen”, he said.

According to the PT, for the rate to be more stable, the calculation should replace monthly inflation with the “moving average of inflation”.

Another demand passed on to Haddad was the flexibility of the TLP by the CMN (National Monetary Council) for a “more favorable” rate. “When [se] is financing a micro and small company, a credit union, it is different from financing an investment in infrastructure for 30, 35 years”, he said.

“We went to discuss alternatives to improve the financing and conditions of the BNDES to provide credit for Brazil to grow and generate jobs,” he added.