Itau Raises $408 Million for Renewable Energy Projects

(Bloomberg) — The Brazilian bank Itau Unibanco Holding SA

raised 1.05 billion reais ($408 million) to finance renewable-energy and water-treatment projects.

That’s the most ever raised for renewable energy in Latin

America by a Brazilian bank, the Sao Paulo-based lender said in

an e-mailed statement Tuesday. The funding includes a five-year,

262 million-real loan from International Finance Corp. and a

three-year, 787 million-real loan from Bank of America Corp.,

Mizuho Bank Ltd. and Commerzbank AG.

“There is a big demand for financing renewable energy

projects in Brazil,” Carolina Amaral Camargo, head of

international financial institutions at the bank’s Itau BBA

unit, said in a telephone interview. “We already have a big

pipeline of operations being analyzed by the bank and we are

going to diversify the financing line for many companies.”

Banks in Brazil may increase their financing for clean

power as President Dilma Rousseff pursues policies to reduce

debt and control inflation and the national development bank

BNDES pulls back, according to Marcelo Girao, head of energy for

project finance at Itau BBA.

“BNDES is slowing down in some types of loans, so the

development bank has to find alternatives with other banks,”

Girao said in an interview in Sao Paulo this month. “Commercial

banks will have more exposure to renewable projects, such as

wind parks.”

Bank of America, for example, has set a goal of $50 billion

for green initiatives in the next 10 years, according to the

statement.

Brazil’s monetary council, which includes the finance

minister and central bank president, raised the benchmark

interest rate for loans provided by BNDES to 5.5 percent

starting Jan. 1, from 5 percent.

Girao estimated that as much as 30 percent of long-term

loans approved in the next few years by the development bank,

Banco Nacional de Desenvolvimento Economico & Social, will come

through private banks, a strategy aimed at “risk

diversification.”

To contact the reporter on this story:

Vanessa Dezem in Sao Paulo at

vdezem@bloomberg.net

To contact the editors responsible for this story:

Reed Landberg at

landberg@bloomberg.net

Jim Efstathiou Jr., Carlos Caminada

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