September 28, 2015 / 1:56 PM / 4 years ago

Brazil corporate defaults hit three-year high as recession worsens

SAO PAULO, Sept 28 (Reuters) - Loan default and unpaid utility bills among Brazilian companies rose during the first eight months at the fastest pace in three years, reflecting the steepest economic recession in 25 years, soaring borrowing costs and a slump in the currency, credit research firm Serasa Experian said on Monday.

The so-called Serasa Experian Corporate Default Index rose 13.3 percent in the January-to-August period from a year earlier, the biggest jump since a 14.3 percent rise three years ago. On an annual basis, corporate delinquencies surged 16.1 percent in August from a year earlier, Serasa said.

On a monthly basis, corporate defaults fell 5.7 percent in August versus July, Serasa said.

Brazil’s economy, the largest in Latin America, shrank over the past couple of quarter and is slated to contract this year and next, the first back-to-back annual contraction since the 1930s.

Households across the country are grappling with accelerating inflation and large job losses, testing the ability of companies and consumers to stay current on their financial obligations, economists said. (Reporting by Guillermo Parra-Bernal Editing by W Simon)

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