Lending in Brazil likely to expand in 2018

The volume of loans in Brazil's financial system is expected to expand next year driven by the country's improved economic performance.

The volume of loans is expected to expand 3% in 2018, according to central bank, ending two consecutive years of contraction. Loans contracted 3.5% in 2015 and are projected to shrink 1% this year.

Expansion expected for the next year will be fueled by demand for consumer loans, while companies are expected to arrange financing via capital markets, through shares and overseas bond issues.

Loans for personal loans are projected to expand 7% in 2018, while corporate loans are seen contracting 2%, the central bank said.

The volume of loans in Brazil's financial system contracted in November, when it totaled 3.063tn reais (US$919bn), down 1.3% from a year earlier.

Corporate loans were down 8.4% while lending to consumers expanded 5.8%.