Brazil's sovereign fund to purchase central bank shares

Brazil's Sovereign Fund (FSB), which has raised some 9.5 billion U.S. dollars since its inception two years ago, will purchase shares of Bank of Brazil for the first time.

The official Agencia Brasil news agency reported Friday that the Fiscal Fund for Investment and Stabilization, a subordinate body of the FSB, has been authorized to purchase up to 21.85 percent of the new shares to be offered by the central bank early next month.

Taking into account of the market price of these shares, the investment can reach 1 billion dollars, about 10 percent of the FSB's total financial resource available, according to the report.

The Bank of Brazil will use proceeds of the deal to expand the supply of credit and finance acquisitions, such as the purchase of Banco Nossa Caixa in Sao Paulo, and Banco Patagonia, an Argentine commercial bank headquartered in Buenos Aires.

Source:Xinhua