“The vast majority of our customers continue to honor their commitments…”
Gilson Bittencourt is vice president of agribusiness and family farming at Banco do Brasil, former secretary of family farming at the Ministry of Agrarian Development, and holds a degree in agronomy from UFPR.
Bittencourt is a specialist in Public Policy Analysis from the University of Texas and holds a master’s degree in Economic Development from Unicamp.
AgriBrasilis – Has default become systemic in agriculture?
Gilson Bittencourt – No. Although we have seen an increase in defaults in some production chains and regions, it is important to note, as disclosed in the latest quarterly balance sheet, that 96.5% of our agricultural portfolio remains in good standing.
The vast majority of our customers continue to honor their commitments. What we have are isolated cases of crops in certain regions.
Agriculture is cyclical, and we are currently undergoing a period of adjustment; however, with concrete actions to support farmers and preserve the sustainability of BB’s agricultural portfolio.
AgriBrasilis – What is the magnitude, and what are the reasons for the credit crisis?
Gilson Bittencourt – We have observed a mismatch between production costs and farmers’ income, which has reduced margins and increased indebtedness. Climatic factors, such as El Niño, have also impacted productivity in certain regions. In some cases, there was leverage above productive and financial capacity, especially between 2022 and 2024.
In addition, we have seen a sharp increase in requests for judicial reorganization. The indiscriminate use of this resource negatively impacts the entire agricultural chain, compromising farmers’ future margins. Therefore, farmers must seek amicable solutions to maintain their operations and productive capacity. Customers undergoing judicial reorganization are not eligible for new bank credit at BB.
AgriBrasilis – Did the risk models underestimate the chances of default? Why?
Gilson Bittencourt – Our models are robust and constantly evolving, but agriculture is a sector that is highly sensitive to external variables, such as climate and international prices. The current cycle has brought an atypical combination of factors that has put more pressure on farmers than expected.
We are already improving our models with intensive use of artificial intelligence, reviewing collection processes, guarantees, and risk mitigators. CMN Resolution No. 4,966 has also required faster provisions, which have directly impacted the cost of credit and led to further adjustments to the models.
“Risk management is being reinforced with technology, customer proximity, and customized solutions…”
AgriBrasilis – Could this default snowball over the coming years?
Gilson Bittencourt – We are working hard to prevent that from happening. We have stepped up our presence in the most affected regions, with teams from various areas of BB offering customized solutions, including for maturing operations.
We are also promoting debt extensions, restructuring, and business alternatives, following the precepts of the Rural Credit Manual, to adjust commitments to the actual payment capacity of affected farmers. Our goal is to ensure the sustainability of the portfolio and support farmers in regaining profitability.
AgriBrasilis – What are the ways to overcome this crisis? How can risk management be strengthened?
Gilson Bittencourt – We have been working on three main fronts: sustainable business growth, improvement of the credit journey, and structural investments. We are reviewing processes and collection procedures, strengthening guarantees, adjusting risk models, and expanding the specialization of our customer service.
Risk management is being reinforced with technology, customer proximity, and customized solutions. Agriculture is strategic for BB, and we will continue to support the sector with responsibility and a long-term vision.
AgriBrasilis – How much has this crisis impacted Banco do Brasil’s results, and what measures are being taken?
Gilson Bittencourt – Yes, there have been impacts, especially in the short term, with increased provisions and reclassification of operations. But our agricultural portfolio is spread out and diversified, with a low level of concentration and more than 200 crops financed in all regions of the country. This ensures resilience.
We have already taken measures to mitigate risks and remain focused on farmers with a solid track record. The long-term strategy remains unchanged, and agriculture continues to be an important driver of growth not only for Banco do Brasil but for the entire country.
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