I - Financial system credit operations
Total financial system credit operations, including operations with nonearmarked and earmarked resources, reached R$3,081 billion in May, up 0.7% in the month and 10.1% over twelve months. In the month, corporate credit operations rose by 0.8% to R$1,627 billion, whereas the balance of household credit operations increased by 0.6% to R$1,454 billion. The credit/GDP ratio reached 54.4%, as compared to 54.3% in April and 52.5% in May 2014.
The portfolio of operations with nonearmarked resources added up to R$1,583 billion in May, up 0.6% in the month and 4.7% over twelve months., The balance of credit operations in the corporate segment grew by 0.7% in the month to R$794 billion, highlighting expansions under advances on foreign exchange contracts (ACC) and foreign on-lending. Nonearmarked household credit operations reached R$789 billion (+0.5 in the month), with emphasis on payroll-deducted loans and credit card operations with immediate payment.
Earmarked credit operations reached R$1,498 billion, up 0.8% in the month and 16.5% over twelve months. Corporate loans increased by 0.9% to R$833 billion, emphasizing investment financing with BNDES resources. Household credit operations rose by 0.6% to R$665 billion, led by house financing operations.
Considering the monthly evolution of credit operations classified according to the borrowers' economic activity sector, including companies of private and public sectors, it should be highlighted expansions in the segments of manufacturing industry (especially metallurgy), public administration, public utility industrial services (with emphasis on gas and energy), and transportation (notably water and air transportation), with respective balances of R$451 billion (+0.7%), R$107 billion (+2.7%), R$147 billion (+1.7%), and R$160 billion (+1.5%). Conversely, the credit portfolio with the trade sector dropped by 0.5% to R$296 billion, reflecting the decline under the segments of wholesale trade and automotive vehicles. Credit operations with the private sector rose by 0.6% in the month to R$2,854 billion, whereas credit to the government increased by 2.3% to R$227 billion, as a result of respective variations of 1.6% and 2.9% under operations with entities connected with the federal government and states and municipalities, respectively.
As for the distribution of the credit portfolio by geographic regions, considering operations above R$1 thousand, it should be emphasized expansions to the Southeast (55% of Brazil's total) and Northeast (13% of the total) regions, with respective balances of R$1,646 billion (+0.8% in the month and +10.5% over twelve months) and R$ 392 billion (+0.6% and 10.9% in the same periods). In the Central-West region, the credit balance rose by 0.5% in the month to R$316 billion, up 13.8% over twelve months, whereas, in the South, the credit balance expanded by 0.2% in the month to R$544 billion, up 8.9% over twelve months. The lowest growth rates were observed in the North region, 0.1% in the month and 7.5% over twelve months, reaching R$114 billion.
I.1 - Interest and default rates
The average interest rate of financial system credit operations, including contracts with nonearmarked and earmarked resources, reached 27.1% p.a. in May, up 0.6 p.p. in the month and 3 p.p. over twelve months. With regard to nonearmarked credit operations, the average cost reached 42.5% p.a., up 0.7 p.p. in the month and 5.9 p.p. over twelve months. As for earmarked credit operations, the rate reached 9.3% p.a., up 0.4 p.p. and 1 p.p. in the same comparison basis.
In the household segment, the rate grew by 0.8% p.p. in the month and 5 p.p. over twelve months, closing at 34.8% p.a. As for contracts with nonearmarked resources, the rate reached 57.3% p.a., up 1.2 p.p. in the month, with increases of 0.3 p.p. under payroll-deducted loans, 13.1 p.p. under revolving credit card, and 6 p.p. under overdraft accounts. With regard to household credit operations with earmarked resources, the average cost rose by 0.3 p.p. in the month to 9% p.a., growing by 0.4 p.p. under house financing operations.
The average interest rate of corporate operations reached 18.9% p.a., up 0.4 p.p. in the month and 2 p.p. over twelve months. As for operations with nonearmarked resources, the average cost grew by 0.3 p.p. in the month to 26.9% p.a., especially under working capital above 365 days (+0.4 p.p.) and foreign on-lending (+1.3 p.p.). With regard to contracts with earmarked resources, the rate grew by 0.6 p.p. to 9.6% p.a., mainly reflecting an increase of 0.5 p.p. in the cost associated with investment financing with BNDES resources.
The bank spread of credit operations with nonearmarked and earmarked resources increased by 0.3 p.p. in the month and 1.9 p.p. over twelve months, reaching 17.4 p.p. Indicators regarding the household and corporate segments closed at 24.9 p.p. and 9.5 p.p., respectively. Spread increased by 0.5 p.p. to 29.8 p.p. in operations with nonearmarked resources and and by 0.1 p.p. to 3.2 p.p. in operations with earmarked resources.
The default rate of financial system credit operations, which measures the percentage of credit balances overdue for more than ninety days, reached 3%, remaining stable in both monthly and year-to-year comparisons. As for household credit operations, the default rate closed at 3.8% (+0.1 p.p. in the month), and remained stable at 2.3% in the corporate segment. As for credit operations with nonearmarked resources, the default rate reached 4.7% (+0.1 p.p. in the month), and closed at 1.2% in the earmarked segment.
II - Evolution of monetary aggregates
The average daily balance of the monetary base reached R$232.1 billion in May, a 2.6% decline in the month, reflecting reductions of 9.3% under bank reserves and 1.3% under currency issued. Over twelve months, the monetary base expanded by 4.1%.
Among the monthly flows of factors conditioning the monetary base, it should be highlighted expansionary effects from adjustments in operations with derivatives, R$22.1 billion, and net currency purchase by banks, R$9.7 billion. On the other hand, operations with federal securities were responsible for a contractionary impact of R$22.8 billion, as a result of net placements on the primary market and net sales on the secondary market, both worth R$11.4 billion.
The average daily balance of restricted means of payment (M1) posted an average daily balance of R$306.3 billion in May, dropping by 1.6% in the month, consequent upon declines of 2.3% under demand deposits and 1% under currency outside banks. Over twelve months, the indicator remained stable.
M2, which corresponds to M1 plus savings deposits and private securities, reached R$2.1 trillion, remaining stable in the month. Private securities rose by 0.2% to R$1.2 trillion, in spite of net redemptions of R$7.5 billion in time deposits. The balance of savings deposits remained stable at R$650 billion, with net redemptions of R$3.2 billion.
M3, which comprises M2 plus quotas of fixed-income funds and government securities backing repurchase operations between the public and the financial sector, rose by 1.3% in May to R$4.5 trillion. The balance of quotas of fixed-income funds rose by 2.3% to R$2.1 trillion, consequent upon net inflows of R$17.6 billion. M4, encompassing M3 and public securities held by the non-financial public, grew by 1.4% in the month and 13.3% over twelve months to R$5.2 trillion.