I - Financial system credit operations
The balance of financial system credit operations reached R$3,074 billion in January, falling by 1% in the month and 3.9% over twelve months. The monthly variation reflected the seasonality of credit granted to enterprises that fell by 2.4% to R$1,508 billion, as opposed to the increase in the household portfolio by 0.3% to R$1,565 billion. The credit/GDP ratio dropped to 48.7%, compared with 53.2% in January 2016.
The credit portfolio with nonearmarked resources, after for two consecutive monthly expansions, fell by 1.5% in January and 5.1% over twelve months to R$1,532 billion. The balance of the corporate segment fell by 3.2% in the month to R$723 billion, highlighting the decreases under discounts of trade bills, other credits and working capital. The balance of the nonearmarked household portfolio remained stable at R$809 billion, with declines in credit card operations with immediate payment and expansion in payroll-deducted loans.
The earmarked credit portfolio totaled R$1,541 billion (-0.5% in the month and -2.7% over twelve months), with emphasis on the monthly decline of 1.6% in the corporate portfolio to R$785 billion, mainly reflecting the settlement of credit operations with BNDES resources. In the household segment, the credit portfolio grew by 0.6% in the month to R$757 billion, with expansions under rural credit and real estate financing.
Among borrowers' economic activity segments, credit balances dropped in all sectors, with the sharpest declines observed in trade (-5%, to R$261 billion), manufacturing (-2.4%, to R$400 billion), construction (-1.8%, to R$99 billion) and transport (-1.4%, to R$139 billion).
Considering operations above R$1,000, the credit portfolio declined in all regions in January: Southeast (-1.2%, balance of R$1,630 billion), North (-0.9%, R$115 billion), South (-0.7%, R$549 billion), Northeast (-0.3%, R$397 billion) and Central-West (-0.1%, R$329 billion).
I1 - Interest and default rates
The average interest rate of financial system credit operations, including credit operations with nonearmarked and earmarked resources, reached 32.8% p.y. in January, increasing by 0.8 p.p. in the month and 1.5 p.p. over 12 months. In the nonearmarked and earmarked segments, the average cost closed at 52.8% p.y. (+1.2 p.p. in the month) and 11.3% p.y. (+0.7 p.p. in the month), respectively.
The average rate closed at 41.9% p.y. in the household segment, rising by 0.3 p.p. in the month and 2.5 p.p. over 12 months. The monthly trajectory was due to an increase of 1 p.p. to 72.7% under interest rates for operations with nonearmarked resources, highlighting highs under non-payroll deducted loans (+1.1 p.p.) and payroll-deducted loans (+0.2 p.p.). In the earmarked household segment, the average interest rate remained at 10.4% p.y.
In the corporate segment, the average rate reached 21.1% p.y., rising by 1.2 p.p. in the month (-1.4 p.p. over twelve months). The rate increased by 1 p.p. to 28.8% p.y. in the nonearmarked segment, highlighting increases under discount of trade bills (+3.4 p.p.), working capital (+0.7 p.p.) and export financing (+2.8 p.p.). The average rate in the earmarked segment increased by 1.6 p.p. to 12.5% p.y., mainly reflecting highs in operations with BNDES resources.
The bank spread of operations with nonearmarked and earmarked resources closed at 23.8 p.p. in January (+1.3 p.p. in the month and +3.8 p.p. over 12 months), reaching 41.7 p.p. in operations with nonearmarked resources (+2 p.p. in the month) and 4.6 p.p. in operations with earmarked resources (+0.9 p.p.). The indicator reached 32.8 p.p. in the household segment and 12.3 p.p. in the corporate segment, up by 0.8 p.p. and 1.7 p.p. in the month, respectively.
The default rate of financial system credit operations related to credit balances overdue for more than 90 days corresponded to 3.7% in January, remaining stable in the month and growing by 0.2 p.p. over 12 months. The default indicator reached 4.0% in the household segment (+0.1 p.p. in the month) and remained stable at 3.5% in the corporate segment. The default rate remained stable at 5.7% in the nonearmarked portfolio and at 1.8% in the earmarked portfolio.
II - Evolution of monetary aggregates
The average daily balance of the monetary base totaled R$260.4 billion in January, decreasing by 1.9% in the month and increasing by 3.5% over twelve months. The monthly variation resulted from a reduction of 3.6% in the balance of currency issued and an expansion of 8.4% in bank reserves, still reflecting the seasonal increased demand for currency observed in December.
Among the monthly flows of factors conditioning the monetary base, the items worth highlighting were the contractionary impacts from operations with federal government securities (R$6.4 billion), financial institutions' deposits, including variations in the balances of reserve requirements (R$5.8 billion), and adjustments in operations with derivatives (R$5.1 billion). By contrast, National Treasury operations posted an expansionary impact of R$8.1 billion.
The average daily balance of the restricted means of payment (M1) reached R$325.3 billion in January, a monthly decline of 4.6%, corresponding to decreases of 6% in demand deposits and 3.5% in currency held outside banks. M1 grew by 2.1% over twelve months.
The balance of the means of payment in the M2 concept, which corresponds to M1 plus savings deposits and private securities, decreased by 2.3% in January to R$2.3 trillion. This trajectory reflected decreases of 10.4% in M1, 1% in savings deposits (balance of R$665 billion) and 0.8% in securities issued by financial institutions (balance of R$1.3 trillion). In the month, net redemptions of R$10.7 billion and R$9.4 billion were observed in savings deposits and time deposits, respectively.
M3, which comprises M2, quotas of fixed-income funds and government securities backing repurchase operations between the public and the financial sector grew by 0.7% in the month to R$5.3 trillion, reflecting increases of 3% in the balance of quotas of fixed-income funds to R$2.8 trillion and 6% in the balance of repo operations to R$185.4 billion. M4, comprising M3 and government securities held by the nonfinancial public rose by 0.2% in the month and 10.4% over the last 12 months, totaling R$6.2 trillion.