Banco Bradesco (BBDC4) Q3 2024 earnings summary

Executive summary

• Recurring net income reached R$5.2 billion in 3Q24, up 10.8% quarter-over-quarter and 13.1% year-over-year, with ROAE at 12.4% and solid profitability driven by higher net interest income, reduced loan loss provisions, and productivity gains.

• Transformation strategy is underway, focusing on operational improvements, digital channels, client-centric decisions, and the launch of new high net worth and digital segments.

• Balanced credit portfolio growth and improving delinquency ratios supported operational performance.

• Strategic partnerships and acquisitions included a 50% stake in John Deere Bank and increased control of Cielo S.A.

Financial highlights

• Total revenue for 3Q24 was R$31.5 billion, up 4.2% quarter-over-quarter and 11.7% year-over-year; net interest income reached R$16.0 billion, up 2.7% quarter-over-quarter.

• Fee and commission income was R$9.9 billion, up 2.8% quarter-over-quarter and 5.1% year-over-year; asset management fee income grew 11% in the quarter.

• Loan portfolio reached R$943.9 billion, up 3.5% quarter-over-quarter and 17.6% year-over-year, with strong growth in individuals and MSMEs.

• Insurance group net income was R$2.4 billion, up 8.1% quarter-over-quarter, with ROAE at 23.7%.

• Operating expenses were R$15.1 billion, up 4.0% quarter-over-quarter; loan loss provisions were R$7.1 billion, down 2.2% sequentially.

Outlook and guidance

• 2024 guidance: expanded loan portfolio growth of 7% to 11%, net interest income growth of 3% to 7%, and fee income growth of 2% to 6%.

• Operating expenses expected to rise 5% to 9%; loan loss provisions projected at R$35 to R$39 billion for the year.

• Continued focus on digital transformation, efficiency improvements, and risk-adjusted returns, with efficiency ratio targeted at 40% by 2026.

• Positive outlook for insurance operations and further investment in technology and digital channels.