Brazil Banks Don't Expect Bad-Loan Surge But Provision Billions
- Bradesco, Itau squirrel away $17 billion as recession deepens
- Both banks say bad-loan rates won't return to 2009 peak
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As top executives at Banco Bradesco SA and Itau Unibanco Holding SA say Brazil’s crisis won’t lead to skyrocketing delinquencies, they’re squirreling away billions of dollars in provisions for bad loans just in case.
Brazil’s two biggest banks by market value boosted allowances for loan losses, which include extraordinary provisions, by 30 percent to 62.9 billion reais ($17 billion) at the end of the third quarter, setting aside enough money to cover a doubling of bad loans, financial statements show. Banco do Brasil SA, the biggest bank by assets, will release results this week.