Rule Change Seen Benefitting Mid-Size Banks

Rule Change Seen Benefitting Mid-Size Banks

Brazil Economy & Policy Bonds

Measures announced by Brazil’s Central Bank lowering banks’ reserve requirements should benefit the country’s mid-sized banks, Barclays says. “In our view, this decision was taken by BCB to primarily make sure liquidity conditions remain intact for smaller banks post the announcement of the liquidation of Cruzeiro do Sul,” the shop says. The Central Bank is incentivizing Brazil’s large-cap banks to use funds freed up under the changes to direct resources to either buy loan portfolios or Letras F

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