Friday, 13 February 2009

Andima's Moraes Says About Petrobras-BNDES Loans: 'One Thing is to Pledge, Another is to Do'

The president of Andima, Brazilian banker Alfredo Moraes (photo, right) is reasonably skeptical over the recent BNDES pledges that it will extend 22 billion reais in loans to state-controlled oil company Petrobras. He told the association's Web site in an interview that ''one thing is to pledge, another is to actually do so.´´ He is right. While some readers have commented in this blog about Petrobras funding needs -- some of these readers actually say that Petrobras may require less than that (something I disagree with) -- I have my doubts that the company will take on so much debt without hearing first from rating agencies. Fitch has already said that the financing required is likely to put credit metrics under pressure (which may trigger a reassessment of credit ratings.)

Moraes is hopeful that credit will soon return to pre-crisis levels. He echoed recent remarks made by central bank President Henrique Meirelles. We all hope so. Funnily, in the same interview, Moraes avoided mentioning the awful surge in the cost of borrowing experienced by companies and individuals in recent months.

Click here on this link to read the story posted on the Andima Web site (it's in Portuguese. I am sorry but I refuse to translate the entire story ... it´s too long and I have to rest .. it's been a long and busy week.)

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