Petrobras Taps Bendine as New CEO

Posted by Joseph Keefe February 6, 2015

Brazil's Petrobras chose current Banco do Brasil SA Chief Executive Aldemir Bendine as its new CEO on Friday, government sources said, as the embattled state-run oil company tries to regroup following the sudden resignation of nearly all of its senior managers amid a corruption scandal.

The choice may disappoint investors who had hoped for a more market-friendly name to fill the post.

Bendine, who has led the state-run bank since 2009 and maintains close links to the ruling Workers' Party, will replace Maria das Graças Foster, according to three government sources who spoke on condition of anonymity.

Numerous local media also reported Bendine would be appointed.

Foster quit along with five key lieutenants on Wednesday amid a huge and still expanding corruption probe.

The scandal has helped send the company's shares tumbling about 60 percent since September and caused a major political crisis for President Dilma Rousseff.

Petrobras preferred shares dropped nearly 5 percent in early trading after reports Bendine would be named, while common shares were down about 4 percent.

Petroleo Brasileiro SA, as the Rio de Janeiro-based company is formally known, said Wednesday that its board would choose new leadership on Friday though it has not yet released an official announcement on a new chief executive being selected.

A press representative for Petrobras declined to comment.

Bendine faces a daunting task. He must restore confidence in a company undermined by price-fixing, bribery and political-kickback allegations and renew access to capital markets cut off by the scandal.

The government, Petrobras' principal shareholder, will also push to maintain more than $200 billion of investment over five years to bolster a sluggish economy.

Speculation about Foster's replacement had been rampant since November when more than three-dozen people, including former Petrobras executives, were caught in the scandal.

The new leadership team's first job will be to tally corruption-related losses and publish audited fourth-quarter results by the end of April as required by Brazilian law and bond contracts with international investors.