MICROCAPITAL BRIEF: Brazilian Development Bank (BNDES) Loans $100m to Banco do Nordeste do Brasil to Expand Microcredit

Banco Nacional de Desenvolvimento Econômico e Social (BNDES), the Brazilian government’s development bank, reportedly has announced that it will loan USD 100 million to Banco do Nordeste do Brasil (BNB), a public bank operating in Brazil’s Northeastern Region. The investment will be made from the microcredit program of BNDES, and BNB will commit an additional BRL 42.8 million (USD 16.6 million) to the effort. The proceeds will be used to fund individual entrepreneurs as well as micro- and small enterprises (MSEs). The interest rate of the wholesale loan will be set according to the country’s Long-term Interest Rate (known as TJLP in Portuguese), which currently stands at 5.5 percent, plus 1.1 percent [1].

As of December 31, 2013, Banco do Nordeste do Brasil (BNB) served 11 states through a network of 301 branches and a staff of 7,150. BNB offers microfinance services through a subsidiary microfinance institution (MFI), CrediAmigo, which was founded in 1998. As of 2013, CrediAmigo, which is affiliated with US-based Accion, reported a gross loan portfolio of USD 935 million and 1.7 million active borrowers [2].

By Julia Marín, Research Associate

About Brazilian Development Bank (BNDES)

Banco Nacional de Desenvolvimento Econômico e Social (BNDES), the Brazilian government’s development bank, was founded in 1952 to provide long-term financing aimed at enhancing Brazil’s development. BNDES finances large-scale industrial and infrastructure operations as well as small and medium-sized private businesses. BNDES also invests in education, health, sanitation and microfinance. The bank started investing in microfinance in 1996 and seeks to support Brazilian microfinance institutions (MFIs) through the BNDES Microcredit Program. As of the December 31, 2013, the Microcredit Program had a portfolio of BRL 1 billion (USD 488 million) and was divided into BNDES Financial Agent Microcredit and BNDES Intermediary Agent Microcredit.

About Banco do Nordeste do Brasil (BNB)

Banco do Nordeste do Brasil (BNB) is a Brazilian public bank. Founded in 1954, BNB operates as a development, investment and commercial bank serving Brazil’s northeastern region. BNB is the government’s primary financing agent in the region, allocating funds to finance individuals and small and medium-sized enterprises as well as to fund social and financial programs. As of December 31, 2013, the bank served 11 states through a network of 301 branches and a staff of 7,150. BNB offers microfinance services through a subsidiary microfinance institution (MFI), CrediAmigo, which was founded in 1998. As of 2013, CrediAmigo which is affiliated with US-based Accion, reported a gross loan portfolio of USD 935 million and 1.7 million active borrowers.

Sources and Resources:

[1] Customas Today, Brazilian Development Bank approves loan of $100 million for Northeast Bank 

[2] Accion website, “Our Impact: CrediAmigo” 

MicroCapital, June 21, 2011, Lauro González of Getulio Vargas Foundation’s Microfinance Studies Centre, Marcelo Azevedo Teixeira of Banco do Nordeste do Brasil (BNB) Praise Brazil’s National Productive Microcredit Programme, Argue More is Needed 

MicroCapital Universe: Brazilian Development Bank (BNDES)

MicroCapital Universe: Banco do Nordeste do Brasil (BNB) 

Do you know that MicroCapital publishes the MicroCapital Monitor newspaper each month? Find out more at https://www.microcapital.org/products-page

Similar Posts: