* Bradesco raises caps on credit limits by 14 billion reais
* Bradesco default ratios are lowest among private peers
SAO PAULO, Jan 14 (Reuters) - Banco Bradesco SA, Brazil’s No. 2 private sector bank, is easing limits on consumer credit as it expects a decline in loan delinquencies to extend through the year, a senior executive told Reuters on Monday.
The bank decided on Monday to increase the supply of consumer credit for individuals exempt from preliminary approval by 14 billion reais ($6.9 billion), a jump of almost 20 percent, according to Octávio de Lazari Junior, Bradesco’s senior vice president for consumer lending. The move followed the assessment that the falling trend in delinquencies will prevail for the year.
“It’s a decision that will help customers to cope with some expenses in the start of the year, such as taxes on vehicles and school materials,” Lazari said in a telephone interview.
The decision comes as Chief Executive Luiz Carlos Trabuco, who spent last year fighting Brazil’s challenging environment for lenders with strict cost controls, seeks to grow more quickly in credit now that defaults are showing signs of abating. Bradesco has the lowest levels of loan delinquencies among Brazil’s largest private-sector lenders.
According to Lazari, the outlook is positive for the expansion of consumer credit as the job market remains robust and wages are resilient. The decision to open more than 1,000 branches in the second half of 2011 led the bank to ease lending limits, he added.
In 2012, private lenders grew their loan books at a pace well below that of state lenders - partly in order to stave off defaults among small- and mid-sized companies and individuals.