I - Financial system credit operations
The balance of financial system credit operations reached R$3,095 billion in October, consequent upon decreases of 0.5% in the month and 2% over twelve months (respective variations of -0.2% and -1.7% in the previous month). The balance of the corporate segment reached R$1,556 billion, falling by 0.8% in the month and 6.7% over twelve months, while the balance of the household segment reached R$1,539 billion, falling by 0.2% in the month and growing by 3.3% over twelve months. The credit/GDP ratio reached 50.3%, compared with 50.8% in September and 53.8% in October 2015.
The credit portfolio with nonearmarked resources totaled R$1,544 billion, reflecting decreases of 0.2% in the month and 3.7% over twelve months. Credit granted to households increased by 0.2% to R$802 billion in the month, with emphasis on credit card transactions with immediate payment. By contrast, the corporate portfolio fell by 0.6%, totaling R$741 billion, highlighting decreases under export financing, external transfers and other credit modalities.
Financing with earmarked resources reached R$1,552 billion (-0.7% in the month and -0.2% over twelve months). Corporate earmarked credits dropped by 0.9% to R$815 billion in the month, highlighting the decline under investment financing with BNDES resources, due to exchange rate variation and settlement of contracts. Operations with households totaled R$737 billion (-0.6% in the month), reflecting a decrease of 0.6% in the house financing portfolio.
Among borrowers' economic activity segments, credit balances to the industry reached R$759 billion (-1.1% in the month), with emphasis on declines of 1.3% in the manufacturing sector and 8% in the mining segment. The balance of credit channeled to the public administration fell by 0.4% to R$741 billion, as a result of decreases in the trade (-0.7%) and transport (-0.6%) segments.
Considering operations above R$1,000, the credit portfolio dropped in all Brazilian regions: Southeast (R$1,660 billion, -0.7%), South (R$544 billion, -0.4%), Northeast (R$396 billion, -0.3%), Central-West (R$324 billion, -0.2%) and North (R$116 billion, -0.4%).
I1 - Interest and default rates
The average interest rate of financial system credit operations, including credit operations with nonearmarked and earmarked resources, reached 33.3% p.y. in October, following increases of 0.3 p.p. in the month and 2.8 p.p. over 12 months. In the nonearmarked segment, the average cost reached 54% p.y. (+0.6 p.p. in the month and + 6.1 p.p. over 12 months). In the earmarked segment, the average cost closed at 11% p.y., falling by 0.1 p.p. in the month and increasing by 0.5 p.p. over twelve months.
The average interest rate for household credit rose by 0.2 p.p. in the month and 4.0 p.p. over 12 months, reaching 42.7% p.y. With regard to operations with nonearmarked resources, the indicator reached 73.7% p.y. (+0.5 p.p. in the month), highlighting overdraft accounts (+4 p.p.) and non-payroll-deducted personal loans (+1.5 p.p.). In the earmarked credit segment, the average household cost fell by 0.2 p.p. in the month to 10.2% p.y., influenced by a reduction of 0.4 p.p. under house financing.
As for corporate loans, the average interest rate closed at 21.7% p.y. (+0.3 p.p. in the month and 0.2 p.p. over 12 months). As for operations with nonearmarked resources, the rate increased by 0.6 p.p. in the month to 30.4% p.y. (guaranteed accounts: +2.7 p.p., discount of trade bills: +2.0 p.p.). In the earmarked credit segment, the average cost remained stable at 12% p.y. in October.
The bank spread of operations with nonearmarked and earmarked resources increased by 0.5 p.p. in the month and 4.4 p.p. over 12 months to 23.9 p.p. in October. Indicators related to the household and corporate segments increased 0.5 p.p. in the month to 33.3 p.p. and 12.4 p.p., respectively. In the nonearmarked segment, the spread increased by 1.0 p.p. to 42.2 p.p., while, in the earmarked segment, the spread remained stable at 4.3 p.p.
The default rate of financial system credit operations related to credit balances overdue for more than 90 days reached 3.9% (+0.2 p.p. in the month and +0.7 p.p. over 12 months). In operations with households, the level of overdue debts remained at 4.2%, while, in corporate operations, the level reached 3.6%, as a result of an increase of 0.3 p.p. in the month. In October, no variation was observed in the default rate for the nonearmarked segment (5.9%), while an increase of 0.3 p.p. was observed in the earmarked segment (1.9%).
II - Evolution of monetary aggregates
The average daily balance of the monetary base reached R$244.1 billion in October, growing by 0.4% in the month and 2.8% over twelve months. The monthly variation reflected a growth of 0.4% under currency issued and a decrease of 0.2% under bank reserves.
Among the monthly flows of factors conditioning the monetary base, items worth highlighting were operations with the National Treasury, with a contractionary impact of R$34.2 billion, and operations with federal government securities, with an expansionary impact of R$35.2 billion, based on net redemptions of R$36.9 billion in the primary market and net sales of R$1.7 billion in the secondary market.
The average daily balance of the restricted means of payment (M1) reached R$311.4 billion in October, reflecting a monthly increase of 1.2%, due to an expansion of 3.1% in demand deposits and a reduction of 0.2% in currency outside banks. M1 grew by 2.9% over twelve months.
The balance of the means of payment in the M2 concept, corresponding to M1 plus savings deposits and private securities, increased by 0.6% in October to R$2.3 trillion. This result reflected the growth of 1% in the balance of private securities to R$1.3 trillion, despite net redemptions of R$3.5 billion of time deposits. The balance of savings deposits remained stable at R$645.6 billion when compared with the previous month, with net redemptions of R$2.7 billion offset by earnings on deposits.
M3, which comprises M2, quotas of fixed-income funds and government securities backing repurchase operations between the public and the financial sector, grew by 1.1% in the month, totaling R$5.1 trillion, reflecting the growth of 1.8% in fund quotas, whose balance totaled R$2.6 trillion. M4, which comprises M3 and government securities held by the nonfinancial public, grew by 0.5% in the month, despite the reduction of 3.3% in the balance of federal securities, R$831.2 billion. M4 grew by 11% to R$6 trillion over twelve months.