Banco do Brasil expects $968 mln contribution to FGC fund

About this update from Banco Do Brasil Sa

Brazilian lender Banco do Brasil (BBSA3.SA) estimates it will need to make a 5 billion reais ($967.79 million) contribution to Brazil's private credit guarantee fund (FGC), CFO Marco Geovanne Tobias said on Thursday. New rules approved to replenish the fund's cash following Banco Master's liquidation included a five‑year advance of banks' contributions this year."Each year, based on the average of our funding, the bank contributes about 1 billion reais… rounding up, I will advance 5 billion reais," Tobias said, noting the measure will have a cash impact.Another rule approved by the FGC introduced an extraordinary levy equal to 50% of the traditional rate.According to Tobias, this will likely add some 450 million to 500 million reais to Banco do Brasil's annual financial expenses.($1 = 5.1664 reais)

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