The president of the Central Bank, Gabriel Galípolo, criticized this Thursday (13) the pressure from non-bank institutions to use the Credit Guarantee Fund (FGC) in retail funding.
Galípolo explained that many small or medium-sized companies seek authorization to act similar to banks, using FGC guarantees, but do not have sufficient assets for such an operation.
"This is a type of behavior that is not desirable, which must be curbed and inhibited by regulators and by us, which is why we have been working hard with the FGC, in a succession of measures", he added.
The main problem, according to the BC president, is that intermediation companies, when they seek to play a role similar to that of banks, compete with each other and with large institutions, but with more lenient rules for funding, longer terms and less need for guarantees.
"The bank is in a business that involves borrowing money cheaper than it lends and having to pay back what it borrowed later than it intends to receive. Even if it manages to make this successful marriage between liabilities and assets, banks are fallible, because the level of default may increase for those who lent money to you, the business may not go well or you may have to transform your assets into liquidity at a speed that is not possible. In these conditions, for you to try to contain this type of run, the guarantee fund plays an essential role", he said. Galípolo, highlighting the importance of the fund as an element of stabilization of the financial system.
The BC president participated in the celebration of the 30th anniversary of the FGC, created on November 16, 1995 to protect small investors and provide stability to the financial system with the arrival of the Plano Real. The fund is maintained with contributions from associated financial institutions.
The fund played an important role during the Real Plan and the 2008 global crisis, providing security to account holders.
Recently, the fund has reimbursed investors and account holders of institutions harmed by Banco Master's fraud, in an amount of approximately R$40.6 billion to cover the guarantees of around 1.6 million creditors. After the impact caused by the Master, the FGC approved an emergency plan to restore cash, with an increase of up to 60% in additional contributions from associated institutions.
When a bank fails, the FGC reimburses deposits and certain investments up to a limit of R$250,000 per Individual Taxpayer Registry (CPF) or National Legal Entity Registry (CNPJ), per institution or financial conglomerate. There is also a global ceiling of R$1 million in compensation per CPF or CNPJ over a period of four years. The objective is to increase investor security and preserve confidence in the financial system.
The event also inaugurated the exhibition "The FGC and the National Financial System Protection Network", which will be on display until September 30th at the Prédio das Moedas, headquarters of B3, in the center of the capital of São Paulo. The exhibition explains the origins and changes the fund has undergone over 30 years, as well as its operation and impacts on the national economy.
