UPDATE 1-Loan disbursements at Brazil's BNDES soar 35 pct in Jan-Feb

Thu Mar 27, 2014 8:02pm EDT

(Adds comment by bank official)

RIO DE JANEIRO, March 27 (Reuters) - Loan disbursements at Brazil's state development bank BNDES, the largest source of long-term corporate credit in the country, surged 35 percent in the first two months of this year, according to a statement on Thursday.

The bank, however, expects declining loan requests and commitments to allow it to slow the pace of disbursements this year.

BNDES lent 28.5 billion reais ($12.6 billion) in January and February, the statement said.

According to BNDES superintendent of planning, Claudio Leal, this increase in disbursements was due to a surge in requests at the end of 2013 after the government said terms for loans would become more costly.

"This 35 percent growth in disbursements does not point to the tendency for this year. It is too early to extrapolate conclusions based on two months with atypical movements and events that will not be repeated," he said.

Leal cited as examples loans for infrastructure projects such as the upgrade of Viracopos airport in Campinas and the Rio de Janeiro subway.

The BNDES has been criticized by some business sectors for overcrowding the local credit market with its enlarged presence in recent years, a process that began when private lending dried in the 2008-2009 global financial crisis. (Reporting by Rodrigo Viga Gaier; Writing by Guillermo Parra-Bernal, Editing by Franklin Paul and Richard Chang)

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