Good morning! This week, we cover the new banking rules making it easier for foreign banks to set up shop in Brazil. Plus, the future of Operation Car Wash. Brazil’s suicide epidemics. What you need to know going forward this week—and the most important facts of the past few days. (This newsletter is for platinum and gold subscribers only. Become one now!)
Less bureaucracy for foreign banks entering Brazil
By way of a presidential decree issued on Friday, the government has authorized the Central Bank to arbitrate the opening of foreign financial institutions in Brazil, as well as approving increases of ownership interest of foreign individuals and companies in Brazilian financial institutions. Until now, any such move depended on presidential authorization.
Why it matters. The move reduces bureaucracy in Brazil’s banking sector, making decisions of whether or not a new player is allowed to enter the Brazilian market more technical and less political, given the powerful banking lobby in the capital city. The move could help reduce market concentration in the Brazilian banking system—often singled out as the main culprit for the prohibitive interest rates imposed on Brazilian consumers, even after years of record-low benchmark rates established by the...