BNDES’s record profits in the first quarter of 2022 (up 32% over the first quarter of 2021 to R$12.9 billion) point to something transformational going on at the state-owned development bank. Led by president Gustavo Montezano since July 2019, BNDES also made R$34.1 billion ($6.68 billion) in 2021 – a record year and 65% above 2020.
However, this headline financial result hides the full picture of the real changes achieved so far by Montezano. This profitability is the consequence of a change in the bank’s strategy that will have much longer-lasting impact on the Brazilian economy than a short-term profit boost.
The bank has now exited speculative positions that it had built up in companies such as Petrobras, Vale, Klabin and JBS. Montezano describes such profits as simply “accounting gains”, adding that in the medium term he expects the bank’s financial returns to be more in line with the Brazilian financial system’s overnight interest rate – the CDI.