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Financial Instruments and Risk Management (Tables) | 12 Months Ended
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Dec. 31, 2023
Financial Instruments And Risk Management |
Schedule of Financial Instruments and Fair Value | The financial instruments, classified in accordance with the accounting principles, are as follows:
|  |  |  |  |  | 2023 |  |  |  | 2022 |
|  |  | Level |  |  | Balance |  |  |  | Fair value |  |  |  | Balance |  |  |  | Fair value |
Financial assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Amortized cost (1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Marketable securities – Cash investments |  |  |  |  |  |  | 11 |  |  |  |  | 11 |  |  |  |  | 380 |  |  |  |  | 380 |
Accounts receivable from Customers and traders; Concession holders (transmission service) |  |  |  |  |  |  | 5,477 |  |  |  |  | 5,477 |  |  |  |  | 4,812 |  |  |  |  | 4,812 |
Restricted cash |  |  |  |  |  |  | 31 |  |  |  |  | 31 |  |  |  |  | 16 |  |  |  |  | 16 |
Accounts receivable from the State of Minas Gerais (AFAC) |  |  |  |  |  |  | 13 |  |  |  |  | 13 |  |  |  |  | 13 |  |  |  |  | 13 |
Concession financial assets – CVA (Parcel ‘A’ Costs Variation Compensation) Account and Other financial components |  |  |  |  |  |  | 806 |  |  |  |  | 806 |  |  |  |  | 944 |  |  |  |  | 944 |
Low-income subsidy |  |  |  |  |  |  |  |  |  |  | - |  |  |  |  | 1,207 |  |  |  |  | 1,207 |
Concession grant fee – Generation concessions |  |  |  |  |  |  | 3,031 |  |  |  |  | 3,031 |  |  |  |  | 2,950 |  |  |  |  | 2,950 |
Agreement between FIP Melbourne and AGPar |  |  |  |  |  |  |  |  |  |  | - |  |  |  |  | 161 |  |  |  |  | 161 |
|  |  |  |  |  |  | 9,369 |  |  |  |  | 9,369 |  |  |  |  | 10,483 |  |  |  |  | 10,483 |
Fair value through profit or loss |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash equivalents – Cash investments |  |  | 2 |  |  |  | 1,342 |  |  |  |  | 1,342 |  |  |  |  | 1,346 |  |  |  |  | 1,346 |
Marketable securities |  |  |  |  |  |  |  |  |  |  |  |  |  |  | - |  |  |  |  |
Bank certificates of deposit (CDBs) |  |  | 2 |  |  |  | 74 |  |  |  |  | 74 |  |  |  |  | 191 |  |  |  |  | 191 |
Financial Notes – Banks |  |  | 2 |  |  |  | 475 |  |  |  |  | 475 |  |  |  |  | 906 |  |  |  |  | 906 |
Treasury Financial Notes (LFTs) |  |  | 1 |  |  |  | 214 |  |  |  |  | 214 |  |  |  |  | 402 |  |  |  |  | 402 |
|  |  |  |  |  |  | 2,105 |  |  |  |  | 2,105 |  |  |  |  | 2,845 |  |  |  |  | 2,845 |
Derivative financial instruments (Swaps) |  |  | 3 |  |  |  | 368 |  |  |  |  | 368 |  |  |  |  | 703 |  |  |  |  | 703 |
Concession financial assets – Distribution infrastructure |  |  | 3 |  |  |  | 1,920 |  |  |  |  | 1,920 |  |  |  |  | 1,407 |  |  |  |  | 1,407 |
Indemnifiable receivable – Generation |  |  | 3 |  |  |  | 784 |  |  |  |  | 784 |  |  |  |  | 691 |  |  |  |  | 691 |
|  |  |  |  |  |  | 5,177 |  |  |  |  | 5,177 |  |  |  |  | 5,646 |  |  |  |  | 5,646 |
|  |  |  |  |  |  | 14,546 |  |  |  |  | 14,546 |  |  |  |  | 16,129 |  |  |  |  | 16,129 |
Financial liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Amortized cost (1) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Loans and debentures |  |  |  |  |  |  | (9,831 | ) |  |  |  | (9,831 | ) |  |  |  | (10,581 | ) |  |  |  | (10,581 | )
Debt with pension fund (Forluz) |  |  |  |  |  |  | (90 | ) |  |  |  | (90 | ) |  |  |  | (251 | ) |  |  |  | (251 | )
Deficit of pension fund (Forluz) |  |  |  |  |  |  | (521 | ) |  |  |  | (521 | ) |  |  |  | (545 | ) |  |  |  | (545 | )
Concessions payable |  |  |  |  |  |  | (28 | ) |  |  |  | (28 | ) |  |  |  | (27 | ) |  |  |  | (27 | )
Suppliers |  |  |  |  |  |  | (3,017 | ) |  |  |  | (3,017 | ) |  |  |  | (2,832 | ) |  |  |  | (2,832 | )
Leasing |  |  |  |  |  |  | (433 | ) |  |  |  | (433 | ) |  |  |  | (354 | ) |  |  |  | (354 | )
|  |  |  |  |  |  | (13,920 | ) |  |  |  | (13,920 | ) |  |  |  | (14,590 | ) |  |  |  | (14,590 | )
Fair value through profit or loss |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivative financial instruments - Swaps |  |  | 3 |  |  |  | - |  |  |  |  | - |  |  |  |  | (91 | ) |  |  |  | (91 | )
Derivative financial instruments (PUT options) |  |  | 3 |  |  |  |  |  |  |  |  |  |  |  | (672 | ) |  |  |  | (672 | )
|  |  |  |  |  |  | - |  |  |  |  | - |  |  |  |  | (763 | ) |  |  |  | (763 | )
|  |  |  |  |  |  | (13,920 | ) |  |  |  | (13,920 | ) |  |  |  | (15,353 | ) |  |  |  | (15,353 | )
(1) The book value represents the approximate fair value amount.
Schedule of Changes in Value of Options | The changes in the value of the options are as follows:
Balance at December 31, 2020 |  |  |  | 536 |
Adjustment to fair value |  |  |  | 100 |
Balance at December 31, 2021 |  |  |  | 636 |
Adjustment to fair value |  |  |  | 36 |
Balance at December 31, 2022 |  |  |  | 672 |
Adjustment to fair value |  |  |  | 58 |
Related assets (1) |  |  |  | 50 |
Payment |  |  |  | (780 | )
Balance at December 31, 2023 |  |  |  | - |
(1) With the acquisition of the share units then held by the Funds in the Investment Structure, Cemig GT became the holder of the related assets, which have aggregate value of R$50. This amount is recognized in Other assets in the Statement of financial position.
Schedule of Derivative Instruments Contracted Realized Gain | The gains and losses realized in 2023 and 2022 are shown below:
|  |  |  |  |  | Maturity |  |  | Trade |  |  | Notional |  |  | Realized gain / loss |
Assets |  |  | Liability |  |  | period |  |  | market |  |  | amount |  |  | 2023 |  |  | 2022 |
US$ exchange variation + Rate (9.25% p.y.) |  |  | Local currency R$ + 152.01% of CDI |  |  | Interest: Half-yearly Principal: Dec. 2024 |  |  | Over the counter |  |  | US$120 |  |  |  | 97 |  |  |  | 185 |
US$ exchange variation + Rate (9.25% p.y.) |  |  | Local currency R$ + 125.52% of CDI |  |  | Interest: Half-yearly Principal: Dec. 2024 |  |  | Over the counter |  |  | US$261 |  |  |  | 87 |  |  |  | (54 | )
US$ exchange variation higher R$5.0984 |  |  | US$ exchange variation lower R$5.0954 |  |  | August 03, 2021 December 16, 2022 |  |  | Over the counter |  |  | 2022: US$280 |  |  |  | - |  |  |  | 32 |
US$ exchange variation higher than R$5.1110 |  |  | US$ exchange variation of less than R$5.1110 |  |  | October 13, 2023 December 05, 2023 |  |  | Over the counter |  |  | US$392 |  |  |  | (79 | ) |  |  | - |
US$ exchange variation higher than R$4.9675 |  |  | US$ exchange variation of less than R$4.9675 |  |  | December 05, 2023 December 19, 2023 |  |  | Over the counter |  |  | US$377 |  |  |  | (38 | ) |  |  | - |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 67 |  |  |  | 163 |
Schedule of Derivative Instruments Contracted | This table presents the derivative instruments as of December 31, 2023, and 2022:
|  |  |  |  |  |  |  |  |  |  |  |  |  |  | Unrealized gain / loss |  |  | Unrealized gain / loss |
Assets (1) |  |  | Liability |  |  | Maturity period |  |  | Trade market |  |  | Notional amount (2) |  |  | Carrying amount 2023 |  |  | Fair value 2023 |  |  | Carrying amount 2022 |  |  | Fair value 2022 |
US$ exchange variation + Rate (9.25% p.y.) |  |  | Local currency R$ + 152.01% of CDI |  |  | Interest: Half-yearly Principal: Dec. 2024 |  |  | Over the counter |  |  | US$250 |  |  |  | 191 |  |  |  | 161 |  |  |  | 428 |  |  |  | 273 |
US$ exchange variation + Rate (9.25% p.y.) |  |  | Local currency R$ + 125.52% of CDI |  |  | Interest: Half-yearly Principal: Dec. 2024 |  |  | Over the counter |  |  | US$500 |  |  |  | 254 |  |  |  | 207 |  |  |  | 568 |  |  |  | 339 |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 445 |  |  |  | 368 |  |  |  | 996 |  |  |  | 612 |
Current asset |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 368 |  |  |  |  |  |  | - |
Non-current asset |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | - |  |  |  |  |  |  | 703 |
Current liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | - |  |  |  |  |  |  | (91 | )
(1) For the US$1 billion Eurobond issued on December 2017: (i) for the principal, a call spread was contracted, with floor at R$3.25/US$ and ceiling at R$5.00/US$; and (ii) a swap was contracted for the total interest, for a coupon of 9.25% p.a. at an average rate equivalent to 150.49% of the CDI. For the additional US$500 issuance of the same Eurobond issued on July 2018 a call spread was contracted for the principal, with floor at R$3.85/US$ and ceiling at R$5.00/US$, and a swap was contracted for the interest, resulting in a coupon of 9.25% p.a., with an average rate equivalent to 125.52% of the CDI rate. The upper limit for the exchange rate in the hedge instrument contracted by the Company for the principal of the Eurobonds is R$5.00/US$. The instrument matures in December 2024. If the USD/BRL exchange rate is still over R$5.00 in December 2024, the company will disburse, on that date, the difference between the upper limit of the protection range and the spot dollar on that date. The Company is monitoring the possible risks and impacts associated with the dollar being valued above R$5.00 and assessing various strategies for mitigating the foreign exchange risk up to the maturity date of the transaction. The hedge instrument fully protects the payment of six-monthly interest, independently of the USD/BRL exchange rate. (2) In million of US$.
Schedule of Exchange Rate Risk | The net exposure to exchange rates is as follows:
Exposure to exchange rates |  |  | 2023 |  |  |  | 2022 |
|  |  | Foreign currency |  |  |  | R$ |  |  |  | Foreign currency |  |  |  | R$ |
US dollar |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Loans and financing (note 21) |  |  |  | (384 | ) |  |  |  | (1,857 | ) |  |  |  | (762 | ) |  |  |  | (3,975 | )
Suppliers (Itaipu Binacional) |  |  |  | (50 | ) |  |  |  | (240 | ) |  |  |  | (52 | ) |  |  |  | (274 | )
|  |  |  | (434 | ) |  |  |  | (2,097 | ) |  |  |  | (814 | ) |  |  |  | (4,249 | )
Net liabilities exposed |  |  |  |  |  |  |  | (2,097 | ) |  |  |  |  |  |  |  | (4,249 | )
Schedule of Fair Value of Derivative Hedge Instrument One | The Company has prepared a sensitivity analysis of the effects on the Company’s net income arising from depreciation of the Real exchange rate considering an adverse scenario in relation to the probable scenario.
Risk: foreign exchange rate exposure |  |  |  |  |  |  | Probable' scenario |  |  |  | Adverse scenario |
|  |  | Base scenario |  |  |  | Dollar R$4.98 |  |  |  | Dollar R$6.00 |
US dollar |  |  |  |  |  |  |  |  |  |  |  |
Loans and financings (note 21) |  |  |  | (1,857 | ) |  |  |  | (1,910 | ) |  |  |  | (2,301 | )
Suppliers (Itaipu Binacional) (note 19) |  |  |  | (240 | ) |  |  |  | (247 | ) |  |  |  | (297 | )
|  |  |  | (2,097 | ) |  |  |  | (2,157 | ) |  |  |  | (2,598 | )
Net liabilities exposed |  |  |  | (2,097 | ) |  |  |  | (2,157 | ) |  |  |  | (2,598 | )
Net effect of exchange rate fluctuation |  |  |  |  |  |  |  | (60 | ) |  |  |  | (501 | )
Schedule of Net Assets Exposure to Exchange Rates | This exposure occurs as a result of net assets indexed to variation in interest rates, as follows:
Risk: Exposure to domestic interest rate changes |  |  | 2023 |  |  |  | 2022 |
Assets |  |  |  |  |  |  |  |
Cash equivalents – Cash investments (Note 6) – CDI |  |  |  | 1,342 |  |  |  |  | 1,345 |
Marketable securities (Note 7) – CDI / SELIC |  |  |  | 774 |  |  |  |  | 1,878 |
Generation indemnity revenue |  |  |  | 784 |  |  |  |  | 691 |
Restricted cash – CDI |  |  |  | 31 |  |  |  |  | 16 |
CVA and in tariffs (Note 14) – SELIC |  |  |  | 806 |  |  |  |  | 944 |
|  |  |  | 3,737 |  |  |  |  | 4,874 |
Liabilities |  |  |  |  |  |  |  |
Loans, financing and debentures (Note 22) – CDI |  |  |  | (3,508 | ) |  |  |  | (2,041 | )
Loans, financing and debentures (Note 22) – TJLP |  |  |  |  |  |  |  | - |
Sector financial liabilities (note 14) |  |  |  |  |  |  |  | - |
|  |  |  | (3,508 | ) |  |  |  | (2,041 | )
Net assets exposed |  |  |  | 229 |  |  |  |  | 2,833 |
Schedule of Exposure to Exchange Rates | The Company made a sensitivity analysis of the effects on results considering an adverse scenario in relation to the probable scenario, as shown in the table below. The CDI rate follows the Selic rate.
|  |  | 2023 |  |  |  | 2024 |
|  |  |  |  |  |  | Probable' scenario |  |  |  | Adverse scenario |
Risk: Increase in Brazilian interest rates |  |  | Book value |  |  |  | Selic 9.25% |  |  |  | Selic 13.25% |
|  |  |  |  |  |  | TJLP 6.27% |  |  |  | TJLP 7.27% |
Assets |  |  |  |  |  |  |  |  |  |  |  |
Cash equivalents (Note 6) |  |  |  | 1,342 |  |  |  |  | 1,466 |  |  |  |  | 1,520 |
Marketable securities (Note 7) |  |  |  | 774 |  |  |  |  | 846 |  |  |  |  | 877 |
Restricted cash |  |  |  | 31 |  |  |  |  | 33 |  |  |  |  | 35 |
CVA and Other financial components – SELIC (Note 14) |  |  |  | 806 |  |  |  |  | 880 |  |  |  |  | 912 |
|  |  |  | 2,953 |  |  |  |  | 3,225 |  |  |  |  | 3,344 |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |
Loans and financing (Note 21) – CDI |  |  |  | (3,508 | ) |  |  |  | (3,833 | ) |  |  |  | (3,973 | )
|  |  |  | (3,508 | ) |  |  |  | (3,833 | ) |  |  |  | (3,973 | )
Net assets exposed |  |  |  | (555 | ) |  |  |  | (608 | ) |  |  |  | (629 | )
Net effect of fluctuation in interest rates |  |  |  |  |  |  |  | (53 | ) |  |  |  | (74 | )
Schedule of Risk of Increase in Inflation | This table presents the Company’s net exposure to inflation index:
Exposure to increase in inflation |  |  | 2023 |  |  |  | 2022 |
Assets |  |  |  |  |  |  |  |
Concession financial assets related to Distribution infrastructure - IPCA (1) |  |  |  | 1,920 |  |  |  |  | 1,407 |
Concession Grant Fee – IPCA (Note 14) |  |  |  | 3,031 |  |  |  |  | 2,950 |
|  |  |  | 4,951 |  |  |  |  | 4,357 |
Liabilities |  |  |  |  |  |  |  |
Loans, financing and debentures – IPCA and IGP-DI (Note 22) |  |  |  | (4,522 | ) |  |  |  | (4,630 | )
Debt with pension fund (Forluz) – IPCA (Note 24) |  |  |  | (90 | ) |  |  |  | (251 | )
Deficit of pension plan (Forluz) – IPCA (Note 24) |  |  |  | (521 | ) |  |  |  | (545 | )
Leasing liabilities |  |  |  | (433 | ) |  |  |  | (354 | )
|  |  |  | (5,566 | ) |  |  |  | (5,780 | )
Net liabilities exposed |  |  |  | (615 | ) |  |  |  | (1,423 | )
(1) Portion of the concession financial assets relating to the Regulatory Remuneration Base of Assets ratified by the grantor (ANEEL) after the 4 th tariff review cycle.
Schedule of Exposure to Exchange Rates Risk | The Company has prepared a sensitivity analysis of the effects on its net income arising from reductions in rates in an adverse scenario.
|  |  | 2023 |  |  |  | 2024 |
|  |  |  |  |  |  | Probable' scenario |  |  |  | Adverse scenario |
Risk: increase in inflation index |  |  | Book value |  |  |  | IPCA 4.23% |  |  |  | IPCA 6.86% |
|  |  |  |  |  |  | IGPM 3.81% |  |  |  | IGPM 5.09% |
Assets |  |  |  |  |  |  |  |  |  |  |  |
Concession financial assets related to Distribution infrastructure – IPCA (1) |  |  |  | 1,882 |  |  |  |  | 1,961 |  |  |  |  | 2,010 |
Concession financial assets related to gas distribution infrastructure – IGPM |  |  |  | 39 |  |  |  |  | 40 |  |  |  |  | 41 |
Concession Grant Fee – IPCA (Note 14) |  |  |  | 3,031 |  |  |  |  | 3,159 |  |  |  |  | 3,238 |
|  |  |  | 4,952 |  |  |  |  | 5,160 |  |  |  |  | 5,289 |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |
Loans, financing and debentures – IPCA and IGP-DI (Note 22) |  |  |  | (4,522 | ) |  |  |  | (4,713 | ) |  |  |  | (4,831 | )
Debt agreed with pension fund (Forluz) – IPCA (Note 24) |  |  |  | (90 | ) |  |  |  | (94 | ) |  |  |  | (96 | )
Deficit of pension plan (Forluz) (Note 24) |  |  |  | (521 | ) |  |  |  | (543 | ) |  |  |  | (557 | )
Leasing liabilities |  |  |  | (433 | ) |  |  |  | (451 | ) |  |  |  | (463 | )
|  |  |  | (5,566 | ) |  |  |  | (5,801 | ) |  |  |  | (5,947 | )
Net liability exposed |  |  |  | (614 | ) |  |  |  | (641 | ) |  |  |  | (658 | )
Net effect of fluctuation in IPCA and IGP–M indexes |  |  |  |  |  |  |  | (27 | ) |  |  |  | (44 | )
(1) Portion of the Concession financial assets relating to the Regulatory Remuneration Base of Assets ratified by the grantor (ANEEL) after the 4th tariff review cycle.
Schedule of Financial Instruments at Interest Rates | The flow of payments of the Company’s obligation to suppliers, debts with the pension fund, Loans and debentures, at floating and fixed rates, including future interest up to contractual maturity dates, is as follows:
|  |  | Up to 1 month |  |  |  | 1 to 3 months |  |  |  | 3 months to 1 year |  |  | 1 to 5 years |  |  | Over 5 years |  |  | Total |
Consolidated |  |  | Principal |  |  |  | Interest |  |  |  | Principal |  |  |  | Interest |  |  |  | Principal |  |  | Interest |  |  | Principal |  |  | Interest |  |  | Principal |  |  | Interest |  |  |  |
Financial instruments at interest rates: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
- Floating rates |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Loans, financing and debentures |  |  |  | 45 |  |  |  |  | 2 |  |  |  |  | 398 |  |  |  |  | 62 |  |  |  |  | 2,152 |  |  |  | 768 |  |  |  | 6,314 |  |  |  | 1,091 |  |  |  | 1,140 |  |  |  | 96 |  |  |  | 12,068 |
Onerous concessions |  |  |  | - |  |  |  |  | - |  |  |  |  | 1 |  |  |  |  | - |  |  |  |  | 3 |  |  |  | - |  |  |  | 13 |  |  |  | - |  |  |  | 16 |  |  |  | - |  |  |  | 33 |
Debt with pension plan (Forluz) (Note 23) |  |  |  | 15 |  |  |  |  | - |  |  |  |  | 30 |  |  |  |  | 1 |  |  |  |  | 46 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 92 |
Deficit of the pension plan (Forluz) (Note 23) |  |  |  | 4 |  |  |  |  | 3 |  |  |  |  | 9 |  |  |  |  | 5 |  |  |  |  | 41 |  |  |  | 22 |  |  |  | 271 |  |  |  | 92 |  |  |  | 287 |  |  |  | 29 |  |  |  | 763 |
|  |  |  | 64 |  |  |  |  | 5 |  |  |  |  | 438 |  |  |  |  | 68 |  |  |  |  | 2,242 |  |  |  | 790 |  |  |  | 6,598 |  |  |  | 1,183 |  |  |  | 1,443 |  |  |  | 125 |  |  |  | 12,956 |
- Fixed rate |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Suppliers |  |  |  | 2,854 |  |  |  |  | - |  |  |  |  | 163 |  |  |  |  | - |  |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 3,017 |
Total |  |  |  | 2,918 |  |  |  |  | 5 |  |  |  |  | 601 |  |  |  |  | 68 |  |  |  |  | 2,242 |  |  |  | 790 |  |  |  | 6,598 |  |  |  | 1,183 |  |  |  | 1,443 |  |  |  | 125 |  |  |  | 15,973 |
Schedule of Credit Exposure | Banks that exceed these thresholds are classified in three groups, in accordance with their equity value, plus a specific segment comprising those whose credit risk is associated only with federal government, and within this classification, limits of concentration by group and by institution are set:
|  |  | Limit per bank (% of equity) (1) (2)
Group | Equity |  | AAA |  | AA |  | A |  | BBB
Federal Risk | - |  | 10% |  | 10% |  | 10% |  | 10%
A1 | Equal or over R$10 billion |  | 9% |  | 8% |  | 7% |  | 6%
A2 | Between R$5 billion and R$10 billion |  | 8% |  | 7% |  | 6% |  | 5%
A3 | Between R$2 billion and R$5 billion |  | 7% |  | 6% |  | 5% |  | 4%
A4 | Between R$800 million and R$2 billion |  | 6% |  | 5% |  | 4% |  | -
1. The percentage assigned to each bank depends on individual assessment of indicators, e.g. liquidity, and quality of the credit portfolio. 2. When the institution has different ratings from different risk rating agencies, the rating that is most favorable for the institution is taken into account.

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