By Marcela Ayres
BRASILIA, July 1 (Reuters) - Delinquency rates on Brazilian loans not tied to a specific purpose rose to 6.2% in May from 6.1% in April, reaching the highest level since the central bank's data series began in March 2011.
The increase for so-called non-earmarked loans came despite the government's launch in early May of a new phase of its consumer debt renegotiation program, which offers Treasury-backed guarantees to lower borrowing costs for eligible consumers earning more than five
times the minimum wage.
In its monetary policy report last week, the central bank cited rising defaults in vehicle lending, unsecured personal credit and payroll-deducted loans to private-sector workers as the main drivers of deteriorating asset quality in non-earmarked credit.
Default rates in all three segments increased in May, reaching 6.5% for vehicle loans, 14.2% for unsecured personal credit and 7.9% for payroll loans to private-sector workers.
"Recent measures to promote household debt renegotiation tend to reduce delinquency rates in eligible credit lines in the coming months," the central bank said in the report.
Last year, President Luiz Inacio Lula da Silva's government introduced new rules to expand payroll lending to private-sector workers, aiming to boost a segment whose outstanding balance jumped 140.3% from a year earlier to 109.2 billion reais ($21.03 billion) in May.
At the time, the government said many borrowers would use the new framework to refinance more expensive debt with cheaper payroll loans, whose instalments are deducted directly from wages.
Central bank data show interest rates on payroll loans for private-sector workers stood at 54.1% a year in May, compared with 142.7% for unsecured personal credit.
Brazil's benchmark interest rate stands at 14.25%, with policymakers signaling that, despite an easing cycle that began in March, borrowing costs will need to remain in restrictive territory to bring inflation, running at 4.8% over 12 months, back to the 3% target.
Against that backdrop, the country's total credit stock rose 0.6% month-on-month to 7.3 trillion reais in May, up 9.5% from a year earlier, easing slightly from annual growth of 9.6% in April.
($1 = 5.1914 reais)
(Reporting by Marcela Ayres. Editing by Mark Potter)
