Alaor and BMG currently standings

 

it has been revealed that twenty days after their risk grade (rating) downgraded by Fitch rating agency, the BMG bank, a leader in providing payroll loans from private financial institutions in the country, began a process of restructuring changes at the top of the institution. According to the Union of Bank of Belo Horizonte Area, 17 employees occupying executive positions and who worked at the bank’s headquarters were shut down last week.

Among them is the commercial director of BMG, Nelio Brant, who had the dismissal confirmed by the vice president of BMG, Márcio de Araújo Alaor. Despite the shutdown, Brant said it will continue to provide advice to the bank.

Sources close to the financial markets speculate that there may be layoffs in offices and representations in Brazil. These cuts would be linked to pressures on BMG’s capital base after completion of the acquisition of Schahin and GE banks. Fitch Ratings downgraded the bank note BMG BB- to B foreign currency and A- to BBB in local currency.

BMG announced the acquisition of Schahin in April last year by R $ 250 million. The Credit Guarantee Fund (FGC) brokered negotiations between the two banks because the Schahin was facing capital problems.

The analyst at Fitch Robert Stoll, said the purchase raised the amount of goodwill for $ 1.6 billion. “The amount of goodwill was primarily due to selective exclusion effected by BMG of assets weakened the Schahin, while the BMG has assumed all its liabilities. This selection process, monitored by Brazilian bank regulators, took the capital of Schahin to be $ 1.3 billion negative at the time of acquisition, “he says.

In the assessment of Fitch, the profitability of BMG should be below the average of its competitors in the short term, since the ability to internal capital generation of the bank will be limited due to the increase in administrative expenses and borrowing and competition.

The vice president of BMG, Márcio Alaor ensures that even with relegation, there was not even an investor’s redemption request. “BMG recorded a growth of 35.6% in the Bank’s portfolio of loans, closing 2011 with a balance of $11.092 billion. Already the total portfolio of loans and leases showed a balance at December 31, 2011 of $ 29.078 billion, representing an increase of 18.7% over the same period of 2010, “says Alaor

Also according to market sources, the layoffs are part of a restructuring process that has already sees a fierce war being waged by the payroll loan market. The Bank of Brazil and the Federal Savings Bank reduced interest rates on loans in order to strengthen the government’s policy to pressure the financial system to reduce bank interest.

Marcio Alaor is a Brazilian entrepreneur that is currently executive of Banco BMG. In addition to being connected to BMG, Alaor is known for revealing companies that have major progressions throughout the year. In a recent report he has identified 15 airlines that are able to stand apart from its competition. Either financially, technically, or innovatively.

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