Share sale for Brazil's Banrisul postponed

The Rio Grande do Sul state government decided to postpone a plan to sell via a public offering an undisclosed portion of its shares in state bank Banrisul.

The postponement took place due to "current capital market conditions," the Brazilian bank said.

In recent months, various companies in Brazil have launched share sales through the stock market due to the improving economy. The high volume of public offerings, however, has reduced the current appetite among investors, according to analysts.

Despite the postponement, the Banrisul said that the state government's plan to sell shares stays intact.

The Rio Grande do Sul government owns 56.97% of the bank's shares and the intention is to remain as controlling shareholder after the sale of shares.

Many state governments across Brazil have embarked on a strategy to raise cash through privatizations, PPPs and the sale of assets in order to compensate for lower tax collection due to the deep recession in 2015-16.