Bank prepares for share issue on expected investment in Brazil
Date added: 30th June, 2010 at 10:32
(view all articles from June, 2010)
Categories: Economy
A bank is preparing for one of the largest share issues of the year, expecting to see R$10.9 billion (£4 billion) worth of investment in Brazil.
Banco do Brasil will be selling 286 million new shares, the pricing of which will be revealed today (June 30th).
The offering may be the biggest seen in the country since Santander's subsidiary in the nation raised R$14.1 billion in 2009, according to Reuters.
Cezar Mezomo, a partner in investment fund Victoire Brasil Investimentos, told the Financial Times that the sale "will definitely be oversubscribed, I think 1.5 or two times".
Strong returns are expected from the country's banking sector of around 20 per cent, the newspaper stated, as the industry is seeing growth.
Credit in the financial institutions is increasing by a rate of two per cent per month, while consumer lending is predicted to continue expanding, the information source noted.
The Financial Times reported that Banco do Brasil's issue will be the third largest in the world so far this year, while state-owned oil firm Petrobras is hoping to gain around $25 billion (£16.62 billion) in its offering in September.
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