Banco Itau Trade Finance Facility

completed

The bank offers an array of financial services including retail, commercial, corporate, and private banking. The facility will be used by the bank to extend international trade finance to Brazilian exporters and importers. The project is in response to Brazil''s need for trade finance at a time of global risk aversion and severe market illiquidity in Brazil. In this environment, fast-moving multilateral initiatives like the proposed TFF have an important role to play not only in providing needed financing to the country, but in buttressing investor sentiment for Brazil. The B Loan will allow international banks that currently have trade-related exposure to Itaú to keep their lines outstanding to the bank, rather than withdrawing them due to short-term Brazil exposure concerns. Such a B Loan initiative would complement efforts on the part of Brazilian banks and the government to persuade international lenders to leave in place lines currently outstanding to Brazilian financial institutions. The project would also be complementary to policy initiatives, reportedly being mulled by other multilaterals such as the IMF, to address the current, severe pullback of bank lines to Brazil.