BB (Banco do Brasil) reported adjusted net income of R$ 6.6 billion in the first quarter of 2022, which is equivalent to a growth of 34.6% compared to the same period last year and 11.5% compared to the immediately previous quarter, according to a balance sheet released this Wednesday (11).
It was the highest profit ever presented by the bank in a quarter, without considering the adjustment for inflation.
“The record profit for the fifth consecutive quarter demonstrates our commitment to the origination of robust businesses, cost control, proximity to our customers, acceleration of our digital transformation and generation of positive social and environmental impacts for the whole society”, said Fausto Ribeiro, president from BB, in note.
According to the bank, the result is explained by the growth in credit, with a positive performance in all segments, by the growth in the gross financial margin (interest charged less interest paid to customers) and by the good performance of service fees.
“We are confident to deliver adjusted net income at the high end of the guidance [estimativa]”, said Ribeiro. The bank projects a profit between R$ 23 billion and R$ 26 billion for 2022.
The public bank’s loan portfolio reached R$ 883.5 billion at the end of March, an increase of 16.4% year-on-year and a 1% increase in the margin.
The delinquency rate over 90 days rose to 1.89% in the first quarter, against 1.95% in March 2021 and 1.75% in December. The increase was within expectations, according to BB.
Ribeiro said that the increase observed in the quarter is part of the strategy of advancing in lines of better returns and, consequently, greater risk, in the portfolio of individuals.
“This risk, however, is absolutely under control, and the upward trajectory of default in 2022 will continue gradually, reaching a comfortable level at the end of the year, at a level lower than that observed in the pre-pandemic period.”
The PCLD (Provision for Doubtful Accounts) totaled BRL 2.75 billion and increased 9.3% compared to the first quarter of last year, but with a decrease of 27.3% compared to the last quarter of 2021.
Expanding credit portfolios
The Individuals portfolio grew 14.9% compared to March 2021, to R$ 268.8 billion, with emphasis on the positive performance of payroll loans (up 12.1%), credit cards (54.1% ) and personal loans (33.0%). In the quarter, the portfolio grew 1.2%.
The corporate loan portfolio ended March with a balance of R$ 267.9 billion, an annual growth of 17%. In this case, the growth of private securities and guarantees (7.2%), receivables (7.7%) and MSME —micro, small and medium-sized companies— (14%) stands out. In the quarter, the evolution was 1%, driven by the growth in the loan portfolio for large companies (4.5%).
The bank’s agribusiness loan portfolio reached R$255 billion, up 28.2% compared to March 2021, driven by items such as agricultural funding (47.8%) and agricultural investment lines, (68.7%). In the quarter, the portfolio grew 2.6%.
“Our credit portfolio will continue to deliver sustainable growth throughout the year, with a more profitable mix balance, which will influence the gross interest margin performance, together with a strong treasury result, and a slower pace of growth in funding expenses” , said the president of the bank.
BB’s gross financial margin totaled R$ 15.3 billion from January to March, an increase of 5.6% in the annual comparison and 3.6% in the quarterly comparison.
Revenues from services rendered, in turn, totaled R$7.5 billion in the first quarter, up 9.4% year-on-year, but down 3.8% at the margin. The decline was due to seasonal effects and the performance of income from credit operations (-13.3%) and capital markets (-40.4%).
As a result of the numbers presented, BB’s RSPL (Return on Shareholders’ Equity), an indicator that measures the profitability of the financial institution’s operation, increased to 17.6% in March, against 15.1% in March 2021 and 16, 6% at the end of last year.
“The delivery of robust results over the last few quarters has allowed us to get closer to the profitability of private peers,” said Ribeiro.
Among the large private banks, Santander Brasil leads in terms of operating profitability, with 20.7%, followed by Itaú (20.4%) and Bradesco (18%).
X-RAY | BANK OF BRAZIL
Foundation 1808
Net profit in the 1st quarter of 2022 BRL 6.6 billion
agencies 3,985
Employees 86,466
Mainly competitors Itaú Unibanco, Bradesco, Santander and Caixa Econômica Federal
I have over 8 years of experience in the news industry. I have worked for various news websites and have also written for a few news agencies. I mostly cover healthcare news, but I am also interested in other topics such as politics, business, and entertainment. In my free time, I enjoy writing fiction and spending time with my family and friends.
