Brazilian Development Bank
|Industry||Finance and Development|
|Headquarters||Rio de Janeiro, Brazil|
|Key people||Luciano Coutinho, (Chairman)|
|Net income||US$ 5.0 billion (2011)|
|Total assets||US$ 334.7 billion (2011)|
The Brazilian Development Bank, also known as National Bank for Economic and Social Development (Portuguese: Banco Nacional de Desenvolvimento Econômico e Social, abbreviated: BNDES) is a federal public company associated with the Ministry of Development, Industry, and Trade. Its goal is to provide long-term financing for endeavors that contribute to the country's development. BNDES is one of the largest development banks in the world (after the Chinese Development Bank, which boasts assets of around RMB 7.52 trillion, or around $1.2 tn). Its non-performing loan ratio is also less favorable (2.2%) compared to the CDB's that stands below 1%.
The results of the endeavors financed by BNDES can be seen in the improved competitiveness of the Brazilian economy as well as in the higher quality of life of its population. BNDES also seeks to strengthen the capital structure of private companies, the development of capital markets, the trading of machines and equipment and the financing of exports.
Since its establishment, on June 20, 1952, BNDES has financed large-scale industrial and infrastructure endeavors, and has played a significant role in the support of investments in agriculture, commerce and the service industry, as well as in small and medium-sized private businesses, even though its focus lies on larger firms. The bank has supported social investments aimed at education and health, family agriculture, basic sanitation and mass transportation.
BNDES considers it fundamentally important, in the execution of its credit policy, to take into account ethical and environmental principles. As such, BNDES is firmly committed to the principles of sustainable development.
The bank offers financial support lines and programs to companies of any size and sector that have been set up in the country. The partnership with financial institutions with agencies established around the country facilitates the dissemination of credit, enabling greater access to BNDES's resources.
The BNDES has three integral subsidiaries: FINAME, BNDESPAR and BNDES Limited. Together, the three companies comprise the BNDES System.
Recently there have been some debates about the bank's plan to finance a dam project that causes dislocation of local communitites. It was also criticised for supporting the international expansion of some private firms.
Criticism and Controversies
Even operating with statutes of "ethical and environmental principles", in 2012, the BNDES approved a 22.5 billion reais loan for the construction of the Belo Monte Dam, a project which has been strongly criticized by environmental groups and indigenous populations.
In 2013 ~90% of BNDESPAR investments concentrates in five industruies. In the recent history of the BNDES investments, lobby irregularities and conflict of interest arrives with JBS S.A. OGX/EBX Group, GPA (company), and others.
Economists around the world recognize that Brazil has its own development bank, and BNDES being a key financial organization, bigger than the World Bank. As the Nobel Prize economist J. Stiglitz opinion, "... the BNDES is a huge development bank (...) People don’t realize this, but Brazil has actually shown how a single country can create a very effective development bank (...) that actually promotes real development without all the conditionality and all the trappings around the old institutions". Despite this recognition of financial volume, effective infra-structure and organization, it is used only by few industruies. The concentration of financial volume in few (and questionable) industruies is a glaring contradiction with their development and diffusion goals.
- Brazilian Development Bank (BNDES) official webpage
- Introduction to Banco Nacional de Desenvolvimento Econômico e Social in English
- Fernando J. Cardim de Carvalho (January 2013). "Relative insulation". D+C Development and Cooperation/ dandc.eu.
- "BNDESPAR CONCENTRATES 89% OF ITS INVESTMENTS IN FIVE INDUSTRIES"
- "BNDES $7.5 billion bet on Friboi", O Estado de S. Paulo, February 15, 2010, www.estadao.com.br/noticias
- www.bloomberg.com/news/2013-07-03 about Eike Batista's fortune gained with help from BNDES, and BNDES loss.
- "Brazil's BNDES approves $10.8 bln loan for Amazon Belo Monte dam". Reuters. November 26, 2012. Retrieved 17 July 2014.
- ISTOÉ about "BNDES feeding JBS": http://www.istoedinheiro.com.br/noticias/57871_BNDES+ALIMENTA+A+JBS
- infomoney.com.br of 2013 July, about BNDES operations with group EBX and CCX, OGX, MMX and MPX.
- Veja (magazine) about "new GPA", a business in which the BNDES should not be
- Goodman, Amy; González, Juan. "Nobel Economist Joseph Stiglitz Hails New BRICS Bank Challenging U.S.-Dominated World Bank & IMF". http://www.democracynow.org/2014/7/17/nobel_economist_joseph_stiglitz_hails_new. Retrieved 26 July 2014.