Banks Seal R$12 Billion Loan Offer for Correios as Treasury Guarantee Decision Nears

Overview

• The consortium’s offer carries an effective cost near 115% of the CDI, below the Treasury’s 120% ceiling, and is expected to be sent for a federal guarantee early next week.
• Banco do Brasil, Caixa, Bradesco, Itaú and Santander will participate, with the operation structured over 15 years and three years of grace, according to the latest negotiations.
• The R$12 billion package is smaller than the R$20 billion initially sought, and Correios has acknowledged it may need additional funding rounds given earlier cost hurdles.
• The loan is contingent on a reorganization that includes a voluntary exit program for 15,000 employees, closure of roughly 1,000 units, and new revenue models to target a return to profit by 2027.
• Labor tensions are escalating as the collective agreement was extended to Feb. 28, unions convene a Dec. 16 strike vote over benefits and inflation indexing, and executives warn of insufficient funds for the 13th salary and December payroll after losses of about R$6.1 billion through September.