Reuters: Bankruptcy News: UPDATE 1-Worried banks put brakes on Brazil lending in September

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UPDATE 1-Worried banks put brakes on Brazil lending in September Oct 26th 2012, 13:33 Fri Oct 26, 2012 9:33am EDT * Lending growth slows to 15.9 pct on annual basis * Private banks put brakes on Sept. disbursements * At current pace, lending growth may miss target By Guillermo Parra-Bernal and Tiago Pariz SAO PAULO/BRASILIA, Oct 26 (Reuters) - Bank lending in Brazil rose in September at the slowest annual pace in almost three years, as private sector banks put the brakes on disbursements as a result of record-high loan delinquencies. Outstanding loans in Brazil's banking system rose 15.9 percent in September to 2.237 trillion reais ($1.1 trillion) from the same month of 2011, the central bank said in a report on Friday. The pace of growth was the slowest since December 2009, when credit expanded 15.2 percent on an annual basis. Should the nation's banks maintain the same pace of loan disbursements through the end of the year, lending could grow below the 15 percent estimate set by the central bank. This year, demand for credit has lagged as one-sixth of households became overleveraged and banks turned more rigorous when awarding loans after delinquencies hit a record. Lending rose 1.1 percent in September from August, the central bank said. Private banks disbursed 0.2 percent more in loans in September, down from 0.9 percent the prior month - a main factor behind the slowdown in overall lending, data from the central bank showed. State-run banks continued to fuel credit growth in Brazil in September, after ramping up loans by 2 percent on a sequential basis. Loans in arrears for 90 days or more were the equivalent of 5.9 percent of outstanding loans last month, a record high, unchanged for a third month, according to the report. Link this Share this Digg this Email Reprints

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