Banco do Estado do Rio Grande do Sul SA confirmed that it has decided to postpone a planned initial public offering of card payment unit Banrisul Cartões SA's preferred shares due to current market conditions.

Brazilian newspaper Valor Econômico recently reported the decision, noting that the IPO received a lukewarm response from investors who thought the subsidiary's shares were expensive compared to larger companies.

In its filing, the bank said it will still proceed with Banrisul Cartões' application for registration as a listed company with securities regulator CVM.

Banrisul Cartões filed for an IPO of its preferred shares in May. A subsequent report said the company had been valued at about 2.5 billion Brazilian reais during initial talks with investors, lower than its expectation for an initial valuation of at least 3 billion reais.

As of July 5, US$1 was equivalent to 3.92 Brazilian reais.