Brazilian state-owned development bank Banco Nacional de Desenvolvimento Econômico e Social is facing losses of up to 14.6 billion reais from loans to the construction and engineering conglomerate Odebrecht SA between 2003 and 2018, Reuters reported, citing a press release from the bank.
According to the state-owned lender, this amount includes losses on export financing credits of 3.7 billion reais related to the federal government and loans amounting to 8.7 billion reais granted to companies under judicial recovery of the Odebrecht Group.
Banco Nacional de Desenvolvimento Econômico e Social, or BNDES, lent 32.9 billion reais in nominal terms to the construction company, which equates to 51.3 billion reais in inflation-adjusted terms.
In June, the corruption-embroiled construction company filed for bankruptcy protection, aiming to restructure 51 billion reais of debt. The company intended to block its seven biggest creditors, which includes BNDES, from taking control of or selling its controlling stake in petrochemical company Braskem SA.
However, despite the significant debt exposure to the construction company, BNDES was already well provisioned to absorb most of the losses.
As of Sept. 27, US$1 was equivalent to 4.15 Brazilian reais.
