Brazil 'has stable banking system'

Brazil's banks are strong, stable and could be one of the winners to emerge from the global financial crisis, it has been stated.

The manager of F&C Latin American Equity Fund Urban Larson has said that the situation concerning the second and third largest private banks in the country - who are currently merging - shows how healthy the country's banking system is.

Banco Itau and Unibanco are joining forces after regulators approved the deal and Mr Larson commented that the country's banking system is "solid and profitable", even though the country is not immune to global problems.

Such considerations may interest investors seeking to buy property in the country, as a strong banking system may be better able to provide finance.

Mr Larson remarked that Brazilian banks had learned "the hard way" the need to retain strong balance sheets due to past domestic economic problems and suggested they "could now emerge among the winners in the troubled global financial sector".

This week Brazil's finance minister Guido Mantega pledged that the government will maintain a "serious fiscal policy" to keep public finances stable as the economy weathers the downturn.
 

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