April 29, 2020 / 1:28 PM / a month ago

Stress test shows Brazil's banks may need up to $13 bln additional capital to face coronavirus crisis

BRASÍLIA, April 29 (Reuters) - Stress tests conducted by Brazil’s central bank show in the COVID pandemic worst case scenario, Brazilian banks would need around 70 billion reais ($13 billion) in additional capital to face higher provisions for losses, according to a Financial Stability report released on Wednesday.

This amounts to 7.2% of Brazilian banks’ capital. The report also says Brazilian banks could take three years to get back to their previous profitability and capital levels and that one additional risk factor are court and legislative decisions suspending credit payments. ($1 = 5.4957 reais) (Reporting by Isabel Versiani Writing by Ana Mano)

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