MercoPress. South Atlantic News Agency

Brazilian government banks suspended payment of states and municipalities debts

CEO Montezano said this could save states hit by the pandemic up to 3.9 billion reais (US$ 790 million)

Brazilian development bank BNDES has suspended the payment of interest and principal on debt owed by municipalities and states through the end of the year, Chief Executive Gustavo Montezano said, citing the coronavirus pandemic.

Speaking in Rio de Janeiro, Montezano said this could save states hit by the pandemic up to 3.9 billion reais (US$ 790 million), and added that the bank may also make emergency transfers of 456 million reais to 13 states.

The CEO added that BNDES, responsible for the bailouts for the largest companies affected by the crisis, has created a 2 billion-Real credit line for healthcare companies.

A bailout for the airlines will probably be disbursed only in July, Montezano said. He added the bank is discussing potential credit for subsidiaries of international carmakers, and that talks on bailouts to power companies are underway.

The CEO said the bank has decided the country’s largest retailers do not need emergency aid from state banks.