Banco do Brasil (BB) broke record profits in the first nine months of the year. From January to September, the financial institution had an adjusted net profit of R$26.1 billion, growth of 14% compared to the same period last year.
In a note, BB reported that the improvement in profits was due to the growth in gross financial margin (+30.1%), resulting from the good performance of the credit portfolio and investments in securities. The bank also cites the diversification of revenues (mainly from services) and control of expenses.
In the third quarter alone, adjusted net profit reached R$8.8 billion, a result 4.5% above the same quarter in 2022 and 12.8% above the previous quarter. The return on equity (RSPL) reached 21.3%, which, according to BB, represents a similar rate to that of private banks.
According to BB, part of the improvement comes from credit growth. The expanded credit portfolio ended September at R$1.07 trillion, 10% above that recorded in September 2022 and 2% above that observed at the end of the second quarter.
The default rate, which takes into account delays of more than 90 days, rose from 2.73% in June to 2.81% in September, reflecting the rise in interest rates, but, according to BB, it is below the average of 3.5 % registered in the national financial system.
In the distribution by credit segments, the expanded individual portfolio grew 7.9% compared to September last year and 0.7% compared to June this year. The highlight was payroll loans (+2% in the quarter and +8.9% in 12 months).
In relation to credit for companies, the expanded legal entity portfolio expanded 4.7% in 12 months. The best performance was recorded in the portfolio for micro, small and medium-sized companies (+4.2% in the quarter and +14.2% in 12 months).
Credit for agribusiness ended September with an increase of 5.7% in the quarter and 18.2% compared to September last year. In the current 2023/2024 harvest alone, R$68.8 billion were lent, an increase of 8.2% compared to the previous harvest. The highlights in credit for agribusiness were funding operations (+14.2% in the quarter and +18.9% in 12 months), investment (+4.8% in the quarter and +37.1% in 12 months) and commercialization (+8.7% in the quarter and +64.9% in 12 months).
Sustainable credit operations, which respect social and environmental parameters, reached R$338.8 billion at the end of the third quarter, an increase of 5.5% in 12 months. Sustainable credit corresponds to 32% of the bank’s expanded credit portfolio.
Income and expenses
Service revenues in the first nine months of the year grew 5% in 12 months. Administrative expenses rose 8% in the same comparison, according to BB due to investments in technology.
Banco do Brasil maintained its projections for 2023. The adjusted profit estimate for the year is between R$33 billion and R$37 billion. The forecast for growth in credit volume this year is between 9% and 13%. Service revenues will grow by 4% to 8%. The forecast for administrative expenses was maintained, with an increase of 7% to 11% this year.