SAO PAULO, June 17 (Reuters) - Brazil’s state development bank BNDES will set a cap on potential purchases of corporate notes aimed at financing part of about 200 billion reais ($65 billion) worth of infrastructure projects expected for coming years, a senior official said on Wednesday.
Rio de Janeiro-based BNDES, which is the country’s largest source of long-term corporate credit, will probably buy between 20 percent and 30 percent of the amount offered in so-called debêntures de infraestrutura, as the notes are known in Portuguese, by projects or companies in those projects, said Cleverson Aroeira, the bank’s head of transport and logistics.
Aroeira said at an event in São Paulo that BNDESPar , as the bank’s investment holding company is known, has no mandate to guarantee buying the majority of issuances of those notes, which are seen as a key instrument to fund the infrastructure investment plan that President Dilma Rousseff announced last week.
Rousseff’s first infrastructure program, which was announced in 2012, failed to spur investment. Investment in fixed capital assets fell to the equivalent of 19.6 percent of gross domestic product in March from about 21 percent in December 2011.
Rousseff is offering investors better terms for investing in infrastructure than during her first term, though low-cost financing from BNDES has been reduced as the government seeks to balance its budget. Bidders will be expected to partially fund projects with private financing raised through infrastructure notes.
$1 = 3.0874 Brazilian reais Reporting by Aluísio Alves; Editing by Guillermo Parra-Bernal and W Simon