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Brazil's state bank president to head troubled Petrobras

Xinhua, February 7, 2015 Adjust font size:

State-run Bank of Brazil President Aldemir Bendine has been named the new CEO of Brazil's troubled state oil giant Petrobras, the energy company's board of directors announced Friday.

Born in Sao Paulo, Bendine, 51, has been working for the state bank since 15 years old and moving up in rank to reach presidency in 2009.

The announcement came 48 hours after Petrobras CEO Maria das Gracas Foster and five of her top executives stepped down amid an ongoing investigation into corruption and kickbacks involving high-level management at Petrobras, as well as legislators from different political parties.

Bendine is known for his ability to handle such serious crises and has a solid relationship with Brazilian President Dilma Rousseff.

Company shares, however, dipped on the news, with analysts saying the market was hoping for a CEO more distanced from the government.

Bendine's immediate challenge will be to publish an audited version of the company's delayed third-quarter earnings report in 2014, which is expected to include an estimate of losses due to the kickback scheme. The delay was one of the factors that forced Foster's exit.

The oil giant has been mired in scandal since investigators revealed late last year that construction and supply firms had been paying high-level executives kickbacks in exchange for major contracts. The scheme is believed to have cost Petrobras some 2.1 billion reais (766.5 million U.S. dollars) between 2004 and 2012.

The scandal has hurt the company's finances, with rating agencies Moody's and Fitch downgrading Petrobras' credit rating.

The Workers' Party, which has been ruling Brazil since 2003, has been accused of receiving a share of all bribes paid in the scheme, amounting to 150-200 million U.S. dollars over a decade.

The party has denied all accusations and questioned the veracity of the statements made by the accuser, a former Petrobras director, as he has agreed to testify in the case in exchange for leniency to his own crimes. Endit