Ney Hayashi – Bloomberg News, 7/16/2012
Banco do Brasil SA is poised to pay the highest dividend yield in the Western Hemisphere as a lending surge sustains profit and shares plunge on investor bets that slowing economic growth may lead to more defaults.
The state-owned bank’s payouts to investors this year will equal 8.1 percent of its current share price, according to the median forecast of 11 analysts surveyed by Bloomberg, the highest ratio among the 80 largest companies by revenue in the Americas. That compares with a 6.7 percent yield for runner-up Vale SA, the world’s largest iron-ore producer. Automaker General Motors Co.’s forecast yield of 0.1 percent is the lowest among the ranked companies.
Banco do Brasil has declined in Sao Paulo trading this year on concern the quality of its loan portfolio is deteriorating as Brazil’s government pressures state-run banks to expand credit to shore up slowing economic growth. Outstanding credit in Brazil rose 18 percent in May from a year earlier to 2.14 trillion reais ($1.05 trillion) after the government cut interest rates and lowered banks’ reserve requirements.