Explanatory notes
11. Operations with Participants
The portfolio of Operations with Participants as of December 31st 2007 was composed as follows:
a) Simple Loans
This portfolio had and increase of R$147,935 thousand in relation to the previous year. Its provision for doubtful receivables represents 0.6 % of the total of this sub-group.
The revision of Simple Loans established better conditions for borrowers, inclusive with a reduction in the Liquidity Fund fee from 0, 5 % to 0, 1 % p.a. for the participants of Plano 1. For the participants of Plano PREVI Futuro, in addition to that benefit, there was also a reduction in the Death Quittance Fund (FQM), from 1,00 % to 0,1 % p.a.
b) Real Estate Financing
In 2007, Real Estate Financing for the participants of benefit plan Plano 1 was reinstated. PREVI, authorized by Caixa Econômica Federal (Federal Savings Bank) - CEF, was appointed as the financing agent to release the funds of Fundo de Garantia por Tempo de Serviço - FGTS (Guarantee Fund for Length of Service), allowing the participants to use those funds to complement the price of the house or apartment under consideration. 616 real estate financings, amounting to R$ 83,087 thousand were granted.
During this year 12,704 real estate financing contracts were renegotiated and 1,151 liquidations were anticipated, of which 157 participants used funds from the FGTS, amounting to R$9,467 thousand. Liquidations with means owned by borrowers reached R$45,949 thousand.
The provision for doubtful receivables of the Real Estate Financing Portfolio reached R$1,055,811 thousand (R$970,956 thousand in 2006). The non performance rate came to 41, 4 % of the total invested. The largest portion of defaulted contracts date back to 1995 (PDV - Programa de Demissão Voluntária - Voluntary Severance Program, offered by the sponsor Banco do Brasil). The accounts receivable are updated according to contractual rates.