Caixa Econômica Federal returned another 7.35 billion reais to Brazil's National Treasury as part of a repayment of loans obtained by the bank during past governments, Valor Econômico reported.
The bank had already paid 3 billion reais in June, bringing the total repayment made to about 10.3 billion reais. The amount already accounts for slightly more than half of the bank's 20 billion reais repayment target for this year.
The measure would result in savings of 4 billion reais annually for Caixa, according to Pedro Guimarães, the bank's president. "Payment generates cost savings and has a significant impact on increased profits," he added.
Caixa used the earnings it gained in the first quarter to pay off the debt, Guimarães said. Similarly, the bank's results will be the only source for the return of another estimated 10 billion reais by the end of the year, the executive said.
The loans being repaid by Caixa correspond to hybrid capital and debt instruments, funds that the government provided to the bank over the past decade. Caixa's government debt linked to those instruments totals 41 billion reais.
As of Aug. 15, US$1 was equivalent to 4.01 Brazilian reais.