Energy: pool of banks to finance auction
The CEO of Banco do Brasil said that alongside other banking institutions, the bank will finance bids by hydroelectric plants. The bidding is slated to begin in early November.
Rio de Janeiro – The CEO of the Brazilian bank Banco do Brasil, Alexandre Corrêa Abreu, said this Monday (26th) at a public event in Rio de Janeiro that alongside other banks, his institution will finance bids by hydroelectric plants in the energy auction set to take place in the first week of November. “The amount required is too large. It would be too much of a burden for a single bank to take on. When we join forces, we can achieve the best conditions. The format is yet to be defined, but it will certainly be a pool of banks,” he said.
The federal government is expecting to collect BRL 17 billion. Concessions will be auctioned for 29 hydroelectric plants, divided into five lots. Investors will also be allowed to make individual bid for some of the plants or groups thereof under sub-lots. For Abreu, the financing is a good opportunity for the banking sector. “We are talking about 30-year contracts, amortized assets, no construction-related risks, with 70% of the energy sold to the government beforehand and 30% on the free market, and that really improves efficiency,” he added.
*Translated by Gabriel Pomerancblum