Gabriela de Ávila Machado
Lawyer at Marcos Martins Advogados
On June 23, the Central Bank announced a new package of measures to combat the effects of the COVID-19 pandemic on the economy. The new measures focus on “directing credit and liquidity to small and medium-sized companies”, while those published in April were important for mitigating the initial effects of Covid-19 on the economy.
The measures published are as follows:
(a) Reduction of capital requirements for smaller institutions;
(b) Working Capital for Business Preservation, which could allow banks to optimize their use of capital; (c) purchase of private bonds;
(c) a deduction in the compulsory collection of savings by financial institutions for up to three years;
(d) reduction of the Risk Weighting Factor (RWF) in Special Guaranteed Time Deposits (SGTD) from 50% to 35%;
(e) the possibility of giving the property as collateral for more than one loan.
