2023-08-03 23:58:07
Bradesco’s second quarter result brought few signs of relief and many of concern.
The main points of attention remain centered on the loan portfolio. To try to hold back defaults, the bank lent less, which reduced the margin with customers by 1.8% compared to the first quarter and by 1.7% compared to the same period of 2022.
At the same time, expenses with provisions increased, and defaults – although it stabilized between May and June – grew in comparison with the first quarter.
This happened in all portfolios, even excluding the impact of the Americanas episode.
The slightly more positive data was the ‘NPL creation’ (the emergence of new loans with problems), which remained stable at around R$ 12 billion.
“But it stabilized at a very high level, and that makes it difficult to get back on track,” said one analyst. In the same period last year, NPL creation had been R$ 9.2 billion.
The numbers sparked another warning sign: how the bank will grow again and deliver a ROE close to the 18% promised by management (in the second quarter, ROE stood at 11.1%, slightly above the 10.6% of the previous quarter ).
“The recovery tends to be very slow,” said another analyst. “Bradesco is starting to have the same problem as Santander, a difficulty in growing. It is a forward-looking concern.”
Net income of BRL 4.5 billion – 5.6% higher than in the first quarter and 35.8% lower than the same period in 2022 – was within consensus, but part of this result is explained by the incidence of a tax rate smaller, due to the depressed result.
Profit before taxes was around BRL 5 billion, 10% below consensus.
The great relief came from the insurance operation, which is very relevant for Bradesco: the result reached BRL 4.8 billion, an increase of 32% compared to the first quarter and almost 31% compared to the same period of 2022.
The margin with the market also improved and should continue in this trend with the fall in interest rates, according to analysts.
The bank also changed some lines of the guidance for 2024. The projection for the growth of the loan portfolio changed from a range of 6.5% to 9.5% to between 1% and 5%.
And this is reflected in the financial margin: the estimate went from a range of 7% to 11% to a range of 2% to 6%.
On the other hand, Bradesco reduced the forecast for operating expenses and increased the insurance company’s profit growth expectation to 21% to 25% (the previous estimate was 6% to 10%).
Making the changes, the projection for profit in 2023 does not change much (around BRL 20 billion), “but the profit for 2024 is compromised,” said one analyst.
The bank will make its call with the market tomorrow at 10:30 am.
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