Caixa Econômica Federal plans to start offering its fixed-rate mortgage product in March, earlier than a previously announced June target launch, Valor Econômico reported, citing CEO Pedro Guimarães.
The Brazilian state-owned bank previously said the mortgage loans will have a term of 30 years. The product will not be pegged to the country's TR referential rate nor the IPCA consumer price index, Guimarães said on Jan. 2.
While such products have been ubiquitous in developed credit markets, Brazil's unpredictable economy has prevented banks from committing to fixed rates for long periods without inflation adjustment.
The move is a "revolution," Guimarães said, noting that the product will allow a consumer "to borrow a mortgage and know how much you will pay for the next 35 years." "This is the best possible rate for people," the executive noted.
Caixa is also set to announce a record profit for 2019, according to Guimarães, who declined to disclose the amount. The bank was able to maintain profitability despite a reduction in the central bank's interest rates, Guimarães added.