Foreign Banks Reduce Credit to Brazil, but Expand Global Loans

Lack of resources seen in the 2008/2009 crisis was not repeated in the pandemic, according to the Bank for International Settlements

São Paulo

Contrary to the 2008/2009 financial crisis, when world bank credit contracted, financial institutions have increased loans during the pandemic in 2020, including to foreign governments and companies from other countries.

For Brazil, however, the availability of external resources was reduced last year, reversing the positive results of 2018 and 2019.

The country recorded a reduction of US$22 billion in foreign bank credits in 2020, according to a report released on Tuesday (27) by the BIS (Bank for International Settlements).

Since the end of 2015, foreign credit to the country has shrunk by $38billion, to about $240 billion at the end of last year.

In the second quarter of last year alone, an outflow of US$ 29.9 billion was recorded, the highest value among the large emerging economies.

Translated by Kiratiana Freelon

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