Brazil ‘could emerge as a winner in recession’
Brazil’s banking system is "solid and profitable" and could become one of the "winners" in struggling worldwide financial market, according to an expert.
Banco Itau and Unibanco, the county’s second and third largest private sector banks, respectively, have announced their first results since the Brazilian authorities approved their merger.
The newly-formed Itau-Unibanco reported that it has a capital adequacy ratio of 16.3 per cent, which it says is "far above" international standards.
Urban Larson, director of emerging equities at asset management company F and C, says: "The banking system remains solid and profitable."
Mr Larson asserts that financial institutions in the country have learned from past mistakes about the importance of maintaining strong balance sheets during previous economic turbulence.
"[They] could now emerge among the winners in the troubled global financial sector," he adds.
Earlier this week, a report by the Bank of America and Merrill Lynch predicted that Brazil’s gross domestic product will grow by 1.3 per cent this year, according to MercoPress.
