May 19, 2020 / 1:47 PM / 3 months ago

Brazil banks baffled as Sao Paulo moves up holidays to fight pandemic

SAO PAULO, May 19 (Reuters) - Brazil's financial institutions expressed dismay and confusion about plans for early celebrations of three public holidays in the business hub of Sao Paulo, an effort to close businesses for more days this week to fight one of the world's worst outbreaks of the novel coronavirus.

On Monday, Sao Paulo Governor Joao Doria and Mayor Bruno Covas said they were working to turn this Wednesday, Thursday and Monday into holidays, with a Friday day off at the discretion of employers.

The holidays they are moving are: the Roman Catholic feast of Corpus Christi (the Body of Christ), normally on June 11; Consciência Negra, a Black Awarenss holiday normally celebrated on Nov. 20; and the Constitutional Revolution Day that is normally celebrated July 9.

Stock exchange operator B3 SA told market participants in a letter on its website that it was discussing the idea with officials, seeking to reduce impacts on markets.

Eleven financial industry associations, including Brazilian banking lobby Febraban, also wrote a joint letter to Doria expressing concern about advancing the holidays, according to a copy of the document seen by Reuters.

Asked about the concerns, the governor's office said it had not received the letter. Febraban and the mayor's office did not immediately respond to a request for comment.

In the Monday briefing, Doria and Covas said they were taking the emergency measure to increase social isolation, pointing to data that showed more people stayed at home on recent weekends and holidays.

Brazil's coronavirus outbreak has exploded in recent weeks, with more than 250,000 confirmed cases, third-highest in the world, and nearly 17,000 fatalities. The city and state of Sao Paulo are at the epicenter of the Brazilian outbreak, with about a quarter of the country's deaths and diagnoses.

The associations expressed concerns said the holidays may cause issues such as closing bank branches that are working to pay out emergency stipends to nearly 50 million people during the pandemic.

The associations also cited issues with bills coming due and pre-scheduled fund redemptions. They requested an exemption from the holidays to continue with regularly scheduled operations.

$1 = 5.72 reais Reporting by Paula Laier Writing and additional reporting Carolina Mandl Editing by Brad Haynes and David Gregorio

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