Brazil Wants Banks to Pare Fees on Investment Funds, Folha Says

President Dilma Rousseff’s administration wants Brazilian banks to lower fees charged on investment funds, Folha de S.Paulo reported, without saying where it obtained the information.

Such a move would allow borrowing costs in Brazil to fall further without affecting the country’s savings-account rules, Folha said. Policy makers this week lowered the benchmark lending rate to 9 percent from 9.75 percent.

Since Brazilian law requires minimum returns on savings accounts, the government’s concern is that further cuts in borrowing costs can drive investors out of investment funds that track the Selic rate and into bank deposits. Lower fees in those funds would postpone the need for the government to change savings-account rules, according to Folha.

To contact the reporter on this story: Ney Hayashi in Sao Paulo at ncruz4@bloomberg.net.

To contact the editor responsible for this story: David Papadopoulos in New York at papadopoulos@bloomberg.net.