CEF head to step down, but not due to PanAmericano scandal, says govt source

- Thursday, March 24, 2011

CEF head to step down, but not due to PanAmericano scandal, says govt source

The president of Brazil's second largest public sector bank, Caixa Econômica Federal (CEF), will step down due to personal reasons, according to a government source quoted by local news service Agência Estado.

Maria Fernanda Ramos Coelho became head of CEF in March 2006 through an appointment by former President Luiz Inácio Lula da Silva and finance minister Guido Mantega.

Since November last year, she has had a tough job due to the huge scandal over Banco PanAmericano's faulty accounting on billions of reais worth of loan book sales. CEF bought a 49% voting and 36.6% overall stake in PanAmericano in December 2009 for 739mn reais (US$446mn).

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The scandal prompted rumors that CEF was going to sell its stake, but it did no. Last month, local investment bank BTG Pactual announced it would pay 450mn reais for 51% of PanAmericano's voting shares, or 37.6% of overall ownership from the Silvio Santos group.

BTG said it would partner with CEF on operational aspects of the new management arrangement and work together on distribution platforms.

CEF is Brazil's largest bank in the savings and housing segments.