FleetBoston 2003 lending to Brazil declines 11 percent

FleetBoston Financial Corp., the
fifth-largest international bank in Brazil, cut lending to the
country by 11 percent last year as utilities and other companies
defaulted on credit.

FleetBoston’s commercial and consumer loans in Brazil fell
to $4.7 billion at the end of the fourth quarter from $5.3
billion at the end of 2002 and $4.8 billion in the third quarter,
the Boston-based bank said in an earnings statement. Non-
performing assets in Brazil rose to $172 million from $63 million
at the end of 2002, as write-offs increased to $80 million from
$9 million.

Cross-border business, including trade lines and other
commitments, fell to $1.7 billion in the fourth quarter from $1.9
billion in the third and $2.2 billion at the end of 2002, the
bank said.

Foreign banks cut credit lines to Brazil in 2002 on concern
President Luiz Inacio Lula da Silva would fail to keep up
payments on the country’s debt. The nation’s economy contracted
in the second and third quarters last year and only began to recover in the fourth, the government has said.

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