BRASILIA, July 21 Brazilian prosecutors on
Monday potentially reduced the liability of banks in a landmark
savings case, slashing its estimate for profits that lenders
made from economic plans that changed depositors' remuneration
more than two decades ago.
The attorney general's office reduced to 21.87 billion reais
($9.85 billion) from 441.7 billion reais its estimate for the
gross profits that banks made from the changes imposed by the
government at the time.
Millions of depositors claim they were incorrectly
remunerated when authorities changed the indexes to which
savings rates were pegged between 1989 and 1991.
The government argues that a ruling against the banks could
have devastating consequences on the economy. The case is under
the review of the country's Supreme Court, which has not yet set
a date to resume deliberations.
A study by consultancy firm LCA on behalf of Brazil's
central bank estimated a victory for depositors could cost banks
between 61 billion reais and 346 billion reais ($27 billion and
The attorney general's office said in a statement that it
sent its new calculations to the Supreme Court on Monday. The
central bank declined to comment on the new estimate.
Shares of state-run Banco do Brasil, which
analysts say would be the most affected in a decision against
banks, gained after the news of the new estimate and ended the
day trading up 2.30 percent.
Shares of private sector bank peers Itaú Unibanco Holding SA
rose 0.85 percent and Banco Bradesco SA
gained 0.80 percent.
($1 = 2.2219 Brazilian Reais)
(Reporting by Alonso Soto; Editing by Grant McCool)