Brazil: Selected Issues Paper
Author: International Monetary Fund. Western Hemisphere Dept.
Publication Date:
12 May 2015
eISBN:
9781475521320
Language:
English
Keywords:
ISCR; CR; minimum wage; Brazil; wage; bond yield; FX debt; S&P Capital IQ; debt issuance; debt stock; NFC debt; Loans; Stocks; Nonperforming loans; Global
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This Selected Issues paper examines infrastructure investment in Brazil. Brazil has inferior overall infrastructure quality relative to almost all its export competitors. Brazil’s infrastructure endowment ranks low by international standards, and its low quality affects productivity, market efficiency, and competitiveness. Areas in which Brazil’s competitiveness has lagged include, but are not limited to, education, innovation, governance, and justice. Brazil’s infrastructure gap has become a major obstacle to growth and filling this gap will entail increasing investment and also stepping up other reforms.

Abstract

This Selected Issues paper examines infrastructure investment in Brazil. Brazil has inferior overall infrastructure quality relative to almost all its export competitors. Brazil’s infrastructure endowment ranks low by international standards, and its low quality affects productivity, market efficiency, and competitiveness. Areas in which Brazil’s competitiveness has lagged include, but are not limited to, education, innovation, governance, and justice. Brazil’s infrastructure gap has become a major obstacle to growth and filling this gap will entail increasing investment and also stepping up other reforms.

Non-Financial Corporate Sector Vulnerabilities1

Non-financial corporate (NFC) firms in Brazil have taken advantage of the favorable global financial environment since 2009 by issuing debt at low cost and long maturities. Leverage—already high by international standards—has edged up without translating into higher capital outlays as Brazilian firms built cash cushions instead of augmenting their capital stock. Costly liquidity holdings have contributed to depressing profitability and weakened interest service capacity. The share of external debt has increased, although it remains below the levels attained in the early 2000s and is largely hedged. While corporate non-performing loans (NPLs) remain low at about 2 percent, weak economic activity has already led to an uptick in overdue loans as well as higher expected default probabilities. Furthermore, the recent Petrobras scandal has left related large construction companies vulnerable which can result in adverse spillovers. Sensitivity analysis suggests that Brazilian corporates are particularly vulnerable to a worsening growth outlook, especially when paired with tighter financial conditions. Vulnerabilities are mitigated by strong financial supervision and a well capitalized banking system.

A. Global Environment

1. The search for yield in global financial markets boosted emerging market debt issuance. The global financial environment of unconventional monetary policies in advanced economies (AMEs) has given NFCs in emerging market economies (EMEs) access to bond finance at unprecedented magnitudes and low rates. Bond issuance has tripled in GDP terms since 2008 amid ample liquidity in financial markets. At the same time, equity issuance remained broadly flat in nominal terms.

A06ufig1

EMEs: NFC’s Bond and Equity Issuance

(In billions of U.S. dollar)

Citation: IMF Staff Country Reports 2015, 122; 10.5089/9781475521320.002.A006

Sources: Dealogic and Fund staff calculations.

2. The share of bond finance in total outstanding debt increased notably. The share of bond finance in total NFC debt stocks increased from about 7 percent in 2007 to 11 percent in 2013 as cross-border bank loans dropped following the retrenchment of bank flows from European countries since the global financial crisis. In fact, the marked rise in NFC bond issuance has more than offset the retrenchment in foreign bank financing.

3. As a result, corporate debt as a share of GDP increased in most emerging market economies (EMEs) since 2007, and by 5 percent or more in about half of the larger EMEs since 2010 alone. A significant share of this increase is explained by foreign exchange denominated debt, often contracted through offshore issuance of foreign incorporated subsidiaries. Since equity issuance did not keep pace, leverage increased substantially in a number of larger EMEs despite strong valuations (Figure 1).

Figure 1.
Figure 1.

Selected Countries: Debt-to-Equity Ratio and Change in NFC Debt 1/

Citation: IMF Staff Country Reports 2015, 122; 10.5089/9781475521320.002.A006

Sources: S&P Capital IQ; Dealogic; BIS; IFS; authorities’ data; and Fund staff calculations.1/ Debt to equity (DTE) ratio is defined as total debt divided by total equity.
A06ufig2

EMEs: Average NFC Debt Composition

(In percent of total NFC debt)

Citation: IMF Staff Country Reports 2015, 122; 10.5089/9781475521320.002.A006

Sources: Dealogic; BIS; IFS; authorities’ data; and Fund staff calculations.

Data Sources

The paper uses several data sources to take advantage of complementarities. These include Dealogic Analytics, S&P Capital IQ, Worldscope, Economática, Moody’s KMV Credit Edge, and data from the Brazilian authorities:

  • Dealogic Analytics: the database covers transaction level bond, syndicated loan and equity issuance, including information on maturity dates, currency of issuance and issuer nationality. Information is aggregated at country and sectoral level in the IMF’s Vulnerability Exercise Securities Database (VESD).

  • S&P Capital IQ: The database contains firm-level balance sheet and income statement information for 693 Brazilian listed companies. It does not include information on foreign currency debt;

  • Worldscope: The IMF’s Corporate Vulnerability Utility (CVU) provides a template to analyze financial conditions of publicly traded firms listed in Worldscope. The number of Brazilian firms reflected in the data is significantly smaller than those in S&P Capital IQ (225 versus 693 as of 2013). Worldscope data is therefore used only to compare to and complement S&P Capital IQ data;

  • Economática and authorities’ data: Complementing S&P Capital IQ, data from Economática and country authorities are used to assess Brazilian firms’ exposure to foreign exchange risk.

  • Moody’s KMV Credit Edge: Moody’s KMV comprises expected default frequencies (EDFs) for publicly listed companies, where EDF measures the probability that a company will default within a given period;

  • In Section 1, to allow for a cross-country comparison, total corporate debt is defined as the sum of outstanding bonds (Dealogic), domestic bank loans (IFS and country authorities), and foreign bank loans (BIS—foreign bank loans to domestic non-banks). In Section 2, the paper uses data on Brazil’s corporate debt stock provided by the country authorities

B. Balance Sheet Developments

4. NFC bond issuance has boomed in Brazil amid easy global financial conditions, mirroring developments seen in other EMEs (Figure 2). Total bond issuance more than doubled since 2008 as equity and syndicated loan issuance declined in nominal terms.2 The bond market boom also increased access to a more diversified variety of borrowers.

Figure 2.
Figure 2.

Brazil: Issuance of Bond and Equity

Citation: IMF Staff Country Reports 2015, 122; 10.5089/9781475521320.002.A006

Sources: Dealogic and Fund staff calculations.

5. Bond issuance contributed to a substantial rise in the stock of NFC debt. Corporate debt has grown by some 15 percentage points of GDP since 2007 and 7 percentage points since 2010. As of end-2013 and June 2014, it stands at a historical high of 47 and 49.2 percent of GDP respectively. This leaves the debt stock, close to the median among selected EME peers (Figure 3). Domestic bank loans remain the most important component of corporate debt, accounting for about 60 percent. However, the composition of debt has increasingly shifted towards domestic bond markets in recent years. External debt declined as a share of total corporate debt since the early 2000s, but has increased since 2010 alongside other EMEs, in part due to offshore issuance by foreign incorporated subsidiaries (see External Sector Assessment) and depreciation of the real.3 In recent years, the composition of bank loans to NFCs has shifted, with earmarked loans from public banks, in particular BNDES, accounting for a higher share of the total, which tends to be associated with lower rates and longer maturities.

Figure 3.
Figure 3.

Brazil and Selected Countries: Corporate Debt

Citation: IMF Staff Country Reports 2015, 122; 10.5089/9781475521320.002.A006

Sources: Central Bank of Brazil; IMF April 2014 GFSR; and Fund staff calculations.

6. Rising debt, paired with stagnant equity issuance, has led to increasing leverage despite strong valuations (Figure 4). Brazil’s debt to equity (DTE) ratio has increased to about 0.8 according to firm-level data from S&P Capital IQ. While leverage has increased, it is not high when compared to the early 2000s. When compared to EME peers, leverage is—and has historically been – high, not only at the median but also at both the lower and the upper quartile of the distribution. Worldscope, an alternative database for firm-level balance sheet information, similarly documents a considerable increase in the DTE ratio, although 2013 levels here are closer to 0.7.4 Breaking the sample of companies down into different industries, we find that leverage is particularly high, and has increased most, among firms that belong to “industrials” (e.g. transportation, infrastructure business, and heavy equipment productions) and produce consumer staples. When focusing only on the largest companies, leverage is about as high as for the sample as a whole, although recent dynamics differ somewhat.

Figure 4.
Figure 4.

Brazil and Regional Peers: Corporate Leverage 1/, 2/

Citation: IMF Staff Country Reports 2015, 122; 10.5089/9781475521320.002.A006

Sources: S&P Capital IQ; Worldscope; and Fund staff calculations.1/ Debt to equity (DTE) ratios are defined as total debt divided by total equity.2/ LA4 includes Chile, Colombia, Mexico, and Peru.

7. Higher leverage has weakened interest servicing capacity since 2010 although it looks much improved compared to earlier years (Figure 5). The IMF’s global financial stability report (GFSR) suggests that corporates are at solvency risk if they operate with an interest coverage ratio (ICR) smaller than 1, and corporates that operate with the ICR smaller than 2 are seen as potentially subject to liquidity risk, given currency global financial conditions. Brazilian firms on average operate with ICRs comfortably above both thresholds, although average ICRs have fallen and remain low compared to peers.5 The share of firms with interest coverage below 1 was about a quarter in 2013, while the share below the threshold of 2 amounted to about 37 percent. When measured by the share of total debt held by firms below the respective threshold, the picture looks improved, yet still unfavorable compared to regional peers: 10 percent of total NFC debt is held by corporates with ICR below 1, and 22 percent is held by corporates with ICR below 2. At the same time, debt servicing capacity has benefited from an improving maturity structure including due to a favorable shift in firms’ liabilities away from short-term debt.

Figure 5.
Figure 5.

Brazil and Regional Peers: Interest Servicing Capacity 1/

Citation: IMF Staff Country Reports 2015, 122; 10.5089/9781475521320.002.A006

Sources: S&P Capital IQ; Worldscope; and Fund staff calculations.1/ The interest coverage ratio (ICR) is defined as EBITDA divided by interest expenditure.
A06ufig3

Interest Rates and Maturity of Bank Loans

(In percent and month)

Citation: IMF Staff Country Reports 2015, 122; 10.5089/9781475521320.002.A006

Sources: Central Bank of Brazil and Fund staff calculations.

8. An interesting finding in the macroeconomic data is that investment failed to recover despite the boom in debt issuance (Figure 6). Using micro data, this finding is confirmed. The data show that Brazilian firms boosted debt issuance but did not increase capital outlays at the same pace.6 Since 2007, the ratio of capital expenditure to total debt has fallen from 26 percent to 10 percent. While a similar development was visible in other countries in the region up until 2009, the bond market boom has boosted investment in these economies since then. Interestingly, capital expenditure to total debt is lowest in industries that are among those in which leverage has increased most, namely industrials and those involved in the production of consumer goods.

Figure 6.
Figure 6.

Brazil and Selected Countries: Capital Expenditure and Profitability

Citation: IMF Staff Country Reports 2015, 122; 10.5089/9781475521320.002.A006

Sources: S&P Capital IQ; WEO; Dealogic; BIS; IFS; authorities’ data; and Fund staff calculations.

9. Rather than investing, firms have used proceeds from debt issuance to build up cash cushions. This behavior is reflected in a markedly higher ratio of cash holdings to gross interest expenditures. Strengthened liquidity positions have enhanced companies’ resilience to financial shocks and can be rationalized as an opportunistic build-up in cash positions as pre-financing for expected future (capital) outlays at a time when funding is unusually cheap. However, the higher liquidity also reduces profitability as can be seen by the marked fall in the median return on equity since 2009. Nevertheless, profitability remains strong with a return on equity of about 8 percent and in line with firms in Brazil’s peer countries.

10. While liquidity holdings may reflect pre-financing of future capital outlays, higher leverage and higher numbers of vulnerable firms could further dampen investment. Table 1 presents findings from firm-level regressions of the ratio of capital expenditure to total debt. While liquidity holdings tend to be associated with future investment, higher leverage and higher numbers of vulnerable firms would depress capital outlays. Interest servicing capacity appears to matter in a non-linear fashion as a drop below the vulnerability thresholds of 1 and 2 has a more significant bearing on investment than a marginal decrease in interest coverage above these thresholds.

Table 1.

Explaining Capital Expenditure

Dependent variable: Share of capital expenditure in total debt Panel regression on Brazilian firms; with fixed effects

article image
Robust standard errors in parentheses * p<0.1, ** p<0.05, *** p<0.01

11. A further implication of the recent bond market boom is the increase in NFC external debt. The share of external debt in total NFC debt has increased from 20 percent in 2010 to 26 percent in 2013, but remains relatively low compared with that in other EMEs (Figure 7).7 An important question is the extent to which the growing offshore issuance of foreign incorporated subsidiaries of Brazilian parent companies is reflected in these statistics. In the case of NFCs, offshore issuance is included in aggregate residency based external debt statistics as long as the proceeds return to Brazil as intercompany loans through the balance of payments. As illustrated in the External Sector Assessment, this indeed appears to be the case for the vast majority of such issuance.8 Using micro level data from Economática for listed firms only, the share of foreign exchange denominated debt (FX debt) amounts to about 31 percent, including FX debt raised locally.

Figure 7.
Figure 7.

Brazil and Selected Countries: Corporate External Debt

Citation: IMF Staff Country Reports 2015, 122; 10.5089/9781475521320.002.A006

12. FX exposure is largely covered through both natural and financial hedges in Brazil’s large foreign exchange derivatives market. Looking at both listed and unlisted firms with foreign exchange exposure individually (Figure 8),

  • Petrobras accounts for some 13.5 percent of total NFC FX debt. It hedged 70 percent of its FX exposure through both domestic and global derivative markets despite ample FX income.9

  • Other exporting companies account for 36 percent of FX debt.

  • Non-exporting companies with at least 80 percent of their FX debt hedged in domestic derivatives markets account for 17 percent of FX debt.

  • Non-exporting companies (both foreign-owned and domestic firms) with hedge for less than 80 percent of their exposures account for 33.5 percent of NFC FX debt,10 or about 10 percent of total debt (Financial Stability Report, September 2014).11

Figure 8.
Figure 8.

Brazil: Share of FX Debt by Borrowers with or without Hedging Mechanisms

(In percent of total FX debt)

Citation: IMF Staff Country Reports 2015, 122; 10.5089/9781475521320.002.A006

Sources: Central Bank of Brazil and Petrobras.

13. Importantly, the Central Bank of Brazil (BCB) has taken the role of key counterpart to long dollar positions in the domestic FX derivatives market. As shown in the SIP on the foreign exchange intervention program, the BCB alone has provided hedge for exposures to the tune of US$ 110 billion as of December 2014. Either directly or indirectly, the BCB is thus the main counterpart of corporate FX hedge in domestic financial markets.

C. Corporate Defaults

14. The worsening economic environment has so far only had a limited bearing on corporate defaults. The overall corporate NPL ratio has remained at a low level of around 2 percent, over the past four years. After peaking at 2.4 percent in mid-2012, the default cycle moved downward (Figure 9). The NPL ratio for earmarked corporate loans—such as rural credits, real estate loans, and BNDES funded loans—has been stable at around 0.5 percent over the same period, irrespective of the economic cycle.

Figure 9.
Figure 9.

Brazil: Corporate NPL Ratio

(In percent)

Citation: IMF Staff Country Reports 2015, 122; 10.5089/9781475521320.002.A006

Source: Central Bank of Brazil.

15. Weak economic activity and tighter financing conditions have, however, led to an uptick in defaults for SME loans and other corporate loan classes. The prolonged economic slowdown limits corporate profits and increases financial constraints. In response to inflationary pressures, the policy rate was hiked by 375 bps to 11 percent between April 2013 and April 2014 which resumed with a further increase of 125 bps since October 2014, and an interest rate on long-term subsidized loans (known as “TJLP”) was raised by 50 bps in December 2014, increasing refinancing costs for corporate borrowing from banks. NPLs for non-earmarked NFC loans rose from 3.1 to 3.6 percent over the past several months in 2014. The increase in certain loan classes, such as overdraft, credit card loans, and revolving credits, already amounts to 2–20 percentage points (Figure 10). Default rates of SME loans rapidly increased from 2.7 to 4.2 percent since August 2013. NPL ratios increased most among firms that produce industrial goods (machinery and equipments) and consumer staples-sectors that are highly leveraged (Figure 11).

Figure 10.
Figure 10.

Brazil: Corporate NPL Rate of Selected Non-Earmarked Loans

Citation: IMF Staff Country Reports 2015, 122; 10.5089/9781475521320.002.A006

Source: Central Bank of Brazil.
Figure 11.
Figure 11.

Brazil: Corporate NPL Rate by Size of Companies and Sectors

Citation: IMF Staff Country Reports 2015, 122; 10.5089/9781475521320.002.A006

Source: Central Bank of Brazil.

16. At the same time, companies affected by the Petrobras corruption probe warrant close monitoring. Prospects of a sustained period of lower oil prices and the ongoing corruption investigation are casting a shadow over Petrobras (see Box 3 in the staff report). Investment plans may need to be revisited, and access to low cost financing represents an important risk. Furthermore, adverse spillovers from the probe to other firms could be significant. Implied default risks among firms in the construction and infrastructure business have already started to increase, in part because the probe could hinder their participation in the infrastructure concessions program. At present, 23 companies have been banned from new contracts with Petrobras. The default of OAS S.A., a major construction firm, highlights the risk that the probe could reduce access to finance both for companies directly involved in the scandal and their suppliers, creditors, and possibly the financial system as a whole (although risks to the banking system appear moderate at this point).

17. The monthly delinquency index compiled by Serasa bottomed out in November 2013, suggesting that some pickup in corporate defaults is expected in 2015 (Figure 12). The delinquency index appears to lead the corporate NPL ratio by about a year. In other words, a new corporate default cycle might be expected from late 2014. The current uptick in the Serasa index seems to be less steep than was the case in previous occasions, reflecting the fact that the share of low risk earmarked loans and long-term loans increased in recent years. Ample corporate liquidity may help mitigate the impacts of slow economic growth and tight financing conditions for some time. The rise of corporate defaults may thus be expected to take place gradually but last for a longer period of time, ceteris paribus. However, if the Petrobras event exacerbates, the pickup of corporate defaults can be more rapid than what is expected otherwise.

Figure 12.
Figure 12.

Delinquency Index by Serasa Experian and Corporate NPL Rate

Citation: IMF Staff Country Reports 2015, 122; 10.5089/9781475521320.002.A006

18. High-frequency data also confirm that default risk is increasing. Moody’s KMV computes the one-year-ahead probability of default at the firm level. The 25th and 50th percentile of expected default probability of Brazilian firms in the dataset remain low at less than 1 percent, but the probability for 50th, 75th and 90th percentiles started to rise from September 2014, led by sectors related to the Petrobras probe (Figure 13) (e.g. oil, gas, coal production/exploration sector and construction sector). Moreover, the probability for the 75th and 90th percentiles exceeds the level in peer countries, pointing to significant stress at the tail of the corporate default distribution.

Figure 13.
Figure 13.

Expected Default Probability

Citation: IMF Staff Country Reports 2015, 122; 10.5089/9781475521320.002.A006

Source: Moody’s KMV.

D. Sensitivity Analysis

19. We explore the sensitivity of interest servicing capacity to a set of macroeconomic shocks. We model three shocks, namely a profit shock, an interest rate shock and an exchange rate depreciation shock. We define all three shocks on the basis of balance sheet information from Capital IQ at end-2013.

20. The baseline interest coverage ratio is defined as EBITDA divided by interest expenditure. Depending on the nature of the shock, we calculate its effect on both EBITDA and interest expenditure separately before recalculating the ‘shocked’ ratio. The profit shock is defined as a percentage shock to EBITDA; the interest rate shock is defined as the impact on short-term (one year) refinancing costs, and is calculated as the percentage point change in interest rates multiplied by the stock of short-term (less than one year) debt outstanding at the end of the previous year.12 In addition, rising interest rates are assumed to boost the return on financial assets by the same increase in percentage points. Finally, the exchange rate shock is defined as an increase in interest expenditure on the share of firms’ assets denominated in foreign currency.13 To account for hedging, we assume earnings to increase by the change in interest expenditure multiplied by the share of foreign currency debt that is hedged.14

21. The sensitivity analysis suggests that Brazilian corporates are particularly vulnerable to a worsening growth outlook. A 10 percent shock to profits would lower the median ICR to 2.8 while a 50 percent shock would push it below the liquidity risk threshold defined in the GFSR (Table 2). A plausible interest rate shock would have a somewhat less critical impact. The reason is that the share of short-term debt in total debt is relatively small, and the impact is further mitigated by sizable holdings of financial assets on firms’ balance sheets. A 30 percent depreciation of the real, in turn, would see the median ICR drop to about 2.4. Finally, a combined shock of significantly tighter financial conditions and lower profits could have a sizable impact on firms’ balance sheets. For example, the combination of a 50 percent shock to profits and a 500 bps increase in interest rates would see the median ICR drop to a critical level of 1.3. These would be clearly severe conditions.

Table 2.

Stress Test Results

article image
Sources: S&P Capital IQ and Fund staff estimates.

E. Discussion

22. Rising corporate leverage, including through overseas borrowing, should be carefully monitored. Non-financial corporate (NFC) firms have taken advantage of the favorable global financial environment since 2009 by issuing debt at low cost and long maturities, mirroring developments seen in other EMEs. Leverage—already high by international standards—has edged up without translating into higher investments as firms built liquidity buffers instead of augmenting their capital stock. Costly liquidity holdings have contributed to depressing profitability and weakened interest service capacity. The share of external debt has increased, although it remains below the levels attained in the early 2000s. While the sector appears to be largely hedged, FX exposures should be monitored carefully, in particular if the BCB should decide to reduce its supply of FX swaps going forward.

23. Brazil’s well capitalized banking system and strong financial supervision will help mitigate risks in a context characterized by a weak growth outlook and concerns related to repercussions from the Petrobras probe. While corporate NPL ratios remain low, weak economic activity has already led to an uptick in overdue loans, especially SME loans, as well as higher expected default probabilities. Sensitivity analysis suggests that Brazilian corporates are particularly vulnerable to a worsening growth outlook, especially when paired with tighter financial conditions. Furthermore, the recent Petrobras scandal has put pressure on the balance sheets of some large construction companies involved in the scandal. Adverse spillovers would impact both suppliers and creditors. Vulnerabilities would be mitigated by strong financial supervision and a well capitalized and provisioned banking system, but careful scrutiny should be in place to assess the economic and financial fallout from the scandal.

1

Prepared by Heedon Kang and Christian Saborowski.

2

Equity issuance spiked in 2010 due to the Petrobras IPO. In September 2010, Petrobras raised about US$70 billion from a public IPO, selling 2.4 billion common shares for 29.65 reais and 1.87 billion preferred shares at 26.30 reais per share.

3

External debt is also subject to relatively low and largely fixed interest rates.

4

S&P’s Capita IQ comprises about 693 Brazilian companies compared to 225 in Worldscope.

5

The yellow line in the first chart in Figure 5 illustrates that ICRs are substantially higher in Brazil—closer to 6—when defining the ICR as EBITDA over net interest expenditure. The reason is high liquidity holdings on Brazilian corporates’ balance sheets.

6

A similar picture arises when plotting capital expenditure relative to total assets and the size of a company’s balance sheet.

7

Less than 1 percent of companies have foreign currency debt, and they account for more than 60 percent of total debt.

8

A so far unpublished analysis by the Central Bank of Brazil suggests that about 90 percent of the proceeds of offshore issuance by foreign incorporated subsidiaries of Brazilian firms returns to Brazil.

9

Note that this analysis takes into account financial hedges in foreign markets only in the case of Petrobras.

10

In aggregate level, they hedge only about 10 percent of their FX debt.

11

When excluding foreign-owned companies that may receive intra-group financial support, the share of non-exporting companies without hedge declines to 16.8 percent of total FX debt and 5.8 percent of total NFC debt.

12

An important caveat of the analysis is the fact that not all corporate debt is linked to market interest rate developments. Refinancing costs for the share of debt linked to the TJLP would not necessarily change with market interest rates.

13

Note that this shock definition does not encapsulate the impact of exchange rate movements on the amortization of debt principal. Considering debt amortization would require defining the ICR based on EBIT rather than EBITDA. We decided to stick to EBITDA in order to stay with the definition used in the Global Financial Stability Report.

14

In the absence of firm-level data on currency composition and hedging contracts, we assume that the share of foreign currency debt is equal to the average of around 30 percent, where 70 percent of the foreign currency debt is hedged (see analysis in previous sections).

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Cover IMF Staff Country Reports
Brazil: Selected Issues Paper
Author: International Monetary Fund. Western Hemisphere Dept.
Volume/Issue:
Volume 2015: Issue 122
Publisher:
International Monetary Fund
ISBN:
9781475521320
ISSN:
1934-7685
Pages:
102
DOI:
https://doi.org/10.5089/9781475521320.002

EMEs: NFC’s Bond and Equity Issuance

(In billions of U.S. dollar)

Selected Countries: Debt-to-Equity Ratio and Change in NFC Debt 1/

EMEs: Average NFC Debt Composition

(In percent of total NFC debt)

Brazil: Issuance of Bond and Equity

Brazil and Selected Countries: Corporate Debt

Brazil and Regional Peers: Corporate Leverage 1/, 2/

Brazil and Regional Peers: Interest Servicing Capacity 1/

Interest Rates and Maturity of Bank Loans

(In percent and month)

Brazil and Selected Countries: Capital Expenditure and Profitability

Brazil and Selected Countries: Corporate External Debt

Brazil: Share of FX Debt by Borrowers with or without Hedging Mechanisms

(In percent of total FX debt)

Brazil: Corporate NPL Ratio

(In percent)

Brazil: Corporate NPL Rate of Selected Non-Earmarked Loans

Brazil: Corporate NPL Rate by Size of Companies and Sectors

Delinquency Index by Serasa Experian and Corporate NPL Rate

Expected Default Probability