Banco do Brasil announces "pool" of banks to finance hydroelectric auctions

Banco do Brasil CEO Alexandre Corrêa Abreu announced Monday (Oct. 26) that the institution will help finance, together with other banks, companies bidding for hydroelectric concessions at an auction scheduled for the first week of November. According to him, the amount of funds is very large.

"For just one bank, it is a great burden. With joint forces, we work under better conditions. We still need to agree to the conditions, but it will certainly be a pool of banks," he asserted.

In Abreu's view, financing is a good deal for the banking industry because there are favorable conditions. "For concessions running 30 years, there are no construction risks and 70 percent of the energy will be contracted by the government, leaving 30 percent to the free market, which greatly improves efficiency," explained Alexandre Abreu.

Abreu also reported that due to the reduction of funds available at the Brazilian Social Development Bank (BNDES), Banco do Brasil may become more active in investing in the country.

"We will not assume the BNDES' role, but we will seek, with creativity and together with the market, other alternatives to finance investment in Brazil."

29 hydroelectric concessions will be auctioned, divided into five lots, and the government expects to raise about $ 4.4 billion.

Translated by Amarílis Anchieta

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