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Report: Brazil's troubled Banco Gerador seeking buyer amid poor performance

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Report: Brazil's troubled Banco Gerador seeking buyer amid poor performance

StrugglingBrazilian bank Banco Gerador SAis preparing to submit to Banco Centraldo Brasil in May a proposal for its sale to another financial institution,Valor Econômico reported, citing anonymoussources.

The proposalincludes a corporate and operational restructuring for Banco Gerador, which hashad an inadequate solvency ratio for the last two years, the report said, addingthe bank's 2015 results are currently being audited due to improper accounting practices.

BancoGerador, which was founded in 2009 with the aim of serving small and medium-sizedbusinesses in northeastern Brazil, began facing economic difficulties in 2014, andits solvency level has subsequently fallen well below the minimum 11% required bythe central bank, the report said.

As aresult, the four founding partners decided not to inject more equity while deleveragingthe bank through the sale of credit portfolios, the report said.

Askedabout a possible intervention in Banco Gerador, the central bank reportedly saidit does not comment on the specific situation of any financial institution.