Banks agree US$ 940 million Brazilian transport loan

The Inter-American Development Bank (IDB), the Japanese Bank for International Cooperation (JBIC) and four commercial banks have agreed a US$ 940 million loan to finance part of the São Paulo ring road in Brazil.

The 32 km long western section of ring road has an estimated cost of US$ 1.5 billion, and forms part of the 182 km beltway project that will eventually surround the city of São Paulo.

Alongside the IDB and JBIC, Portuguese commercial banks Caixa Geral de Depositos and Banco Espirito Santo and French bank Calyon will contribute to the loan with US$ 200 million of funds over a 13 year term.

Brazil's Banco Bradesco will provide BRL 750 million (US$ 440 million) in subordinated unsecured debt.

IDB team leader for the project, Renato Mazzola said, "The IDB is working closely with development agencies and other multilateral institutions to mobilise resources for Latin America and the Caribbean. JBIC's participation was crucial for the transaction, since it attracted other lenders, helping secure long-term financing for the beltway project."

As part of the loan package, the IDB will provide a 15 year, US$ 100 million loan while the JBIC will lend US$ 200 million, also over 15 years.