Political appointee to lead Petrobras amid scandal

OREANDA-NEWS. February 09, 2015. Brazil's state-controlled Petrobras has named the politically connected head of state-controlled Banco do Brasil as its new chief executive in a bid to restore the firm?s integrity amid expanding allegations of widespread corruption.

Aldemir Bendine replaces Maria das Gracas Foster. Earlier this week, Foster and five senior company executives resigned after months of pressure for their removal.

In 2009, Bendine was appointed to head Banco do Brasil by then-President Luiz In?cio Lula da Silva.

Foster, who is close to current President Dilma Rousseff, was appointed in 2012 to replace then-chief executive Jos? Sergio Gabrielli, who is one of the high-level targets of ongoing corruption investigations.

The controversial choice to head Petrobras falls short of investor expectations for a technical appointee seen as having more independence. The company's stock price tanked today, after rebounding when Foster resigned on 4 February.

The new chief executive has a tough mandate to navigate Petrobras through a massive scandal in which some two dozen construction firms are accused of systematically overcharging for contracts with Petrobras so part of the money could be diverted to government-allied politicians.

The case has reverberated onto Rousseff, who chaired the company between 2003 and 2010 when much of the corruption allegedly took place. She has denied any knowledge of the scheme.

Bendine has strong ties with the ruling Workers party (PT) and is already linked with various scandals related to his tenure at Banco do Brasil. The bank has previously backed several of the companies that have been temporarily blocked from doing business with Petrobras because of their alleged involvement in the corruption scheme.

Supporters defend Bendine's record of tightening compliance and increasing efficiency at Banco do Brasil.

Bendine is joined by new chief financial officer Ivan Monteiro, Banco do Brasil's vice president of investors service; upstream director Solange da Silva Guedes, the current executive manager of exploration and production; downstream director Jorge Celestino Ramos, the current executive supply manager; gas and services director Hugo Repsold Jr, executive manager of gas and services; and engineering director Roberto Moro, who is currently executive engineering manager.