UPDATE 1-Brazil cut limits on BNDES development bank lending program

viernes 13 de noviembre de 2015 07:37 GYT

(Adds information on credit lines)

SAO PAULO Nov 13 (Reuters) - Brazil's national monetary council cut the limits to a subsidized lending program administered by state-run development bank BNDES, according to a statement released on Friday.

The country's main economic policymaking body said it set the limit to a program known as Inovação-Grandes Empresas to 445 million reais ($118 million), down from 452 million reais. It slightly raised the limit to a capital goods purchase program for small companies to 30 million reais from 25 million reais.

The council also revived a credit line for the purchase of machines and equipment worth 2 million reais.

The three subsidized credit lines are part of massive capital investment program known as PSI, which has a limit of 19.5 billion reais.

Last month, the council more than halved funding for the PSI in an effort to reduce costly public subsidies.

Business leaders and even some government officials complained that the steep cut would squeeze exporters at a time when the economy sinks into its worst recession in 25 years.

Finance Minister Joaquim Levy has defended measures to cut subsidies as part of an austerity drive to rebalance the overdrawn public accounts.

($1 = 3.7709 Brazilian reais) (Reporting by Alonso Soto; Editing by John Stonestreet and W Simon)