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BNDES H1 profit jumps 253.9% as income from financial intermediation soars

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BNDES H1 profit jumps 253.9% as income from financial intermediation soars

Banco Nacional de Desenvolvimento Econômico e Social on Aug. 13 posted 4.76 billion reais in profits for the first half of 2018, up 253.9% from 1.34 billion reais earned a year earlier as the Brazilian state-run bank's income from gross financial intermediation jumped and credit risk provisions sank 98.3%.

Based on its reported first-quarter profit of 2.06 billion reais, the results imply that net income came to about 2.70 billion reais for the second quarter alone.

Gross income from financial intermediation rose to 6.5 billion reais in the half-year period, as the development bank, known as BNDES, booked 1.06 billion reais in provisions, down from 4.73 billion in the first half of the year prior.

Results for the half also saw income from equity interests rise 189.3% year over year to 4.10 billion reais. The bank said its consolidated equity interests, which includes the results of BNDES Participações SA, increased by 312.6% to 2.28 billion reais due to income from sale of investments, especially the sale of shares of Petrobras and Eletropaulo.

BNDES' net loan portfolio declined 5.3% in the period. The company's ratio of nonperforming loans more than 90 days past due fell to 1.45% from 2.08% in the linked quarter, BNDES said.

Total consolidated assets, meanwhile, declined by 3.8%, mainly due to the repayment of 60.14 billion reais to Brazil's national treasury.

Previously the development bank had said the amount of loans granted to the public in the first half of the year totaled 27.8 billion reais, down 17% from 33.5 billion reais for the same period of 2017.

Disbursements to small and medium-sized enterprises amounted to 13.5 billion reais, up slightly from 13.3 billion reais in the same period in 2017.

However, while disbursements to SMEs remained stable in the semester, its share in total credit rose from 39.7% to 48.6%.

As of Aug. 10, US$1 was equivalent to 3.85 Brazilian reais.

David Feliba contributed to this article.