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BNDES to repay Brazil's debt with cash and securities

Staff Writer |
brazil's state development bank BNDES plans to repay up to 100 billion reais ($29 billion) in loans owed to the federal government using a mix of cash and securities, CEO Maria Sílvia Bastos Marques said.

BNDES will not use the 70 billion reais worth of equity holdings that it owns through investment arm BNDES Participações SA for the repayment, Bastos said in a Tuesday interview at the bank's Rio de Janeiro headquarters.

The repayment is eagerly awaited by government officials racing to stem a budget deficit that may hit a record for a second year.

Bastos voiced agreement with Finance Minister Henrique Meirelles that the repayment should be used to cut Brazil's national debt, and not to help debt-laden states, as proposed by some ministers, Reuters reported.

"Brazil's first, second and third priority is fixing public finances," Bastos, 59, said. "We're doing our part."

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