Tax reform is supported by CEOs of Itaú and Bradesco – 06/27/2023 – Market

Bank presidents defended this Tuesday (27) the tax reform, classified by them as a “unique opportunity” for Brazil.

President of Bradesco, Octavio de Lazari Junior stated that the country has the conditions to enter the radar of global financial capital, if it manages to advance with important measures such as tax reform, the fiscal framework and the reduction of interest rates.

“The tax reform is in the oven and perhaps it is the best opportunity of the last 20, 30 years that we have to carry out a tax reform that adjusts the cost of Brazilian companies to manage this tax, which is extremely high and which is in the cost of Brazil” , he said during the FebrabanTech event, organized by the federation of banks, in São Paulo.

Lazari Junior added that there is a large volume of capital available in global markets, and that the country needs to adjust some things that “are not yet well adjusted” to compete for these resources.

“Tax reform, fiscal framework, interest rate reduction, all this will be essential for us to be definitively on this investment map”, said the executive.

“We have a great opportunity to attract foreign investment, the world is looking at investment opportunities, because it has a lot of capital to allocate,” he added. “And Brazil stands out as one of the main destinations, but still needs to adjust things. It is an opportunity that may take another 20 years to appear again.”

Itaú President Milton Maluhy Filho endorsed the competitor’s speech and also defended the approval of the tax reform in Congress. “The country is experiencing a unique opportunity and we have to take advantage of this opportunity. These windows do not appear every day,” he said.

The executive qualified the tax reform as “super important” and pointed out that the country is on the eve of a vote on the subject in the Chamber. “We have to have a collective vision of the country, and not of each sector”, he defended when dealing with the tax reform.

In a video recorded for the event, vice president Geraldo Alckmin (PSB) stated that the financial sector has helped the government in discussions of important agendas in the economic field, referring to the new fiscal framework and tax reform.

“The financial sector has been a great partner for us to disseminate in Brazilian society the importance of the new fiscal regime and of a tax reform that stimulates production and completely exempts investment and also completely exempts our country’s exports”, stated Alckmin.

The vice-president also recalled that the BNDES recently joined Febraban, an approach that, according to him, will allow the government and the private sector to design a credit policy that is balanced and consistent with consumption and investment needs in Brazil.

Also during the opening of the event, the president of Febraban, Isaac Sidney, defended the role of banks in the Brazilian economy and their importance in the social area. And he quickly dealt with the level of interest in the country.

“Interest rates are a consequence of economic problems,” he said, in a speech that has been adopted by Febraban when dealing with fees charged from families and companies. “Investments do not dialogue with uncertainties”, she added.

According to Isaac, the country urgently needs to lower the cost of credit. “We need to tackle the root causes of financial intermediation costs,” he said.

In his speech, Lazari also quickly dealt with interest. According to him, the country is “almost” in the reduction of interest rates.

Currently, the basic Selic rate is at 13.75% per year and, in the financial market, the majority expectation is that the Central Bank promotes a first cut of 0.25 percentage points at the August meeting.

Febraban president criticizes fintechs

Sidney also criticized fintechs, which have gained space in the market in recent years.

“We are sometimes qualified by the newly arrived competition as traditional institutions, the banks, usually accompanied by a tone of demerit, almost accusatory. Here is a reflection, the jocular tone of the competition reveals something that those who criticize us do not: they have no history. We have a beautiful history”, stated the president of Febraban.

“It is not derogatory to have history, a physical presence in all states of the country and to be involved in the daily lives of millions of companies and people”, said the leader.

He added that some financial industry entrants in the country come “out of nowhere” and call themselves modern, cheap and innovative. “We, banks, were not born now and we do not work with marketing and publicity”, said Sidney.

According to him, innovations such as Real Digital and Open Finance are in the full evolution phase and it will be the banks that will consolidate this process.

“Pix, created by the Central Bank and proudly incorporated into our banking routine, is a national success and an international example. It is no wonder that DOC, with 37 years of use, succumbed to this modernity and will be discontinued in 2024” , said Sidney.

Banks will be protagonists in the front of best sustainability practices and green policies, defends the sector

The president of Febraban also stated that banks will continue to be protagonists in terms of better sustainability practices and green policies.

“A few weeks ago, after more than a year of conversations with the entire banking industry, with the meat sector, NGOs and various government agencies, we announced self-regulation for the meat chain in the Legal Amazon region and Maranhão”, said Sidney .

President of Itaú, Milton Maluhy Filho stated that the bank’s intention is to contribute to the transition of clients towards the adoption of more sustainable practices in their operations. “We want to be the transition bank, supporting our customers in this process”, said the executive.

He added that last year Itaú approved a project that provides for the granting of credits in the order of R$ 400 billion in client projects that promote sustainable practices until 2025. So far, R$ 300 billion has already been released. The expected amount is revised as the targets are achieved, said Maluhy Filho.

President of BTG Pactual, Robertou Sallouti stated that the bank is preparing to structure a fund aimed at reforestation in the amount of US$ 1 billion. About half of the amount is already reserved by large international investors and governments, including the United States.

The project provides for the reforestation of 280,000 hectares of deforested pasture, with the recovered area used to sell carbon credits.

“If we use our ability to originate, distribute and distribute ideas, to efficiently allocate resources, we manage to combine good returns for investors with an activity that really helps the environment, Brazil and the world”, stated Sallouti.

Caixa president Maria Rita Serrano said that sustainability occupies a prominent role within the bank’s strategic plan for the coming years.

“There is no dichotomy between sustainability, investment in the bioeconomy and the commitments to decarbonization that are so present today in our country and so urgent in the world”, said the president of Caixa.

With Reuters