LatinFinance - January/February 2018 - 38

FINTECH
INTERVIEW

Banco do Brasil plans to start using blockchain technology for interoperability with
other banks in the first half of 2018, but it wants to test everything before it uses for
financial transactions, the bank's IT director, Gustavo Fosse, tells Mick Bowen

Building
blockchains

lockchain technology, which allows banks to share clients'
financial information, is coming to Brazil. Banco do Brasil, the largest
commercial bank in the country, is conducting a series of tests, both
by itself and with other financial institutions through the local banking
association Febraban, and it plans to start rolling out products with the
new technology in the second half of the year or the first half of 2019.
With blockchain comes the promise to transform Brazil's banking
market, but its influence does not stop there, says Gustavo Fosse, IT director at Banco do Brasil. The question is which sectors will adapt most
quickly to the new technology.
"There is space for everything. It is a revolutionary technology,"
Fosse says.
In the banking sector, blockchain not only has to the potential to
make life easier for retail customers, it can also improve access to financing for corporate clients, including large borrowers looking to get
syndicated loans, Fosse says.
LatinFinance spoke with Fosse about the development of blockchain
technology and its possible applications in Brazil's banking sector.
LatinFinance: What impact will blockchain technology have on Brazil's banking
industry?
Gustavo Fosse: Blockchain technology is still... I wouldn't say it's just beginning, but
it's still evolving, still maturing. Everything that we see with blockchain technology in the
financial system comes from tests that the banks have done internally or through Febraban, which has a group that is studying blockchain technology and how to apply it to the

38 L ATINFINA NCE.COM - January/February 2018

banking business.
I think the biggest impact will be improving our clients' use of financial services
because blockchain technology will permeate various sectors, not just the financial
sector. If you take a good look, you'll see
people using bitcoin based on blockchain
technology. Maybe it's the one business that
most uses blockchain technology.
The technology is also going to make it
easier to register transactions and assets in
trade repositories. It is going to change how
clearing houses and custodial banks work,
so it will also change how banks work.
There are some people who say it will be
the end of the clearing houses, but I don't
think so.
LF: How is Banco do Brasil beginning
to use blockchain technology?
GF: Banco do Brasil has been testing various types of blockchain technology. There
seem to be close to 90 different types in the
world today, with three or four emerging
as the major ones. The one technology that
everyone will use still doesn't exist. There
are technologies that are more tailored for
the financial sector and others for clearing
houses.
Here at Banco do Brasil, for close to
the past year or year and a half, we have
analysts who are studying the technology
and running tests. We are participating in
a group that we formed with Febraban and
we've already run two tests with two dif-

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