Company: BBD
Filing Date: 2025-03-31
Form Type: 20-F
Source: 0001292814-25-001244
Chunk: 60

Company: BANK BRADESCO
Filing Date: 2025-03-31
Form: 20-F
Item: Item 3
Chunk 60
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 enacted in 1988, established an annual interest rate ceiling of 12.0% on bank loans (remunerative). However, this ceiling does not apply, as its implementation depends on regulation by the National Monetary Council (CMN), which has never been issued.
 On May 29, 2003, Constitutional Amendment No. 40 (EC 40/03) was promulgated and revoked all sub-items and paragraphs of Article 192 of the Brazilian Constitution, in particular paragraph 3 of Article 192, which specifically addressed this issue. The understanding that this ceiling was not yet in effect was confirmed in a binding precedent (Súmula Vinculante) No. 7, a final decision issued in 2008 by the STF, in accordance with such Court’s prior understanding on this matter. Since 1988, several attempts have been made to regulate the limitation on loan interest rates, particularly bank loan interest rates, but none of them were implemented or confirmed by the Congress and/or confirmed by the Brazilian courts.
 Most of our revenues, expenses, assets, and liabilities are directly linked to interest rates. Therefore, the imposition of a limitation or cap on loan interest rates could significantly and adversely affect our operating results and financial condition, our loan portfolios, our funding cost, and our loan operation revenues. However, there is currently no indication that the bills under consideration will actually be approved by Congress, as they lack technical justification.
 As for civil obligations, monetary corrections, and interest on obligations, on March 1, 2023, the STJ, the highest court in Brazil for matters relating to federal law, started to hear a case discussing the possibility of applying the SELIC rate to adjust debts of a civil nature (such as indemnity-related legal proceedings). On August 21, 2024, the STJ’s Special Court concluded the trial and decided that the SELIC rate should apply to adjust civil obligations. The decision remains subject to appeal.
  
24 – Form 20-F 2024 | Bradesco
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In addition to the STJ’s decision, on July 1, 2024, Law No. 14,905, of June 28, 2024 (“Law No. 14,905/24”) was published, which modified several key provisions of the Civil Code and provided that, in case there is no interest index agreed between the parties or provided for in a specific law, the following will apply: (i) monetary adjustment (inflation