Banco BTG Pactual (BPAC11) Q2 2024 earnings summary

Executive summary

• Achieved record adjusted net income of R$2.95bn in 2Q24, up 15% year-over-year, and total revenues of R$6.0bn, up 10% year-over-year, with adjusted ROAE at 22.5%.

• Robust performance across investment banking, corporate lending, asset management, and wealth management, supported by business and geographic diversification.

• Net new money inflows were R$56bn in 2Q24, with AuC/AuM/WuM surpassing R$1.7tn, up 23% year-over-year.

• Unsecured funding base expanded 30% year-over-year to R$236bn, maintaining strong capital and liquidity metrics.

• Recognized with multiple industry awards and advanced ESG initiatives, including structuring US$1.7bn in sustainable bonds.

Financial highlights

• 2Q 2024 total revenues reached R$6.0bn, up 10% year-over-year; adjusted net income was R$2.95bn, up 15% year-over-year.

• For 1H 2024, total revenues were R$11.88bn and net income grew 21% year-over-year to R$5.84bn.

• LTM 2Q24 revenues were R$23.2bn, with LTM adjusted net income of R$11.4bn and LTM ROAE at 22.9%.

• Shareholders' equity reached R$53.1bn, up 2.1% sequentially and 13.6% year-over-year; Basel Ratio at 16.2%.

• Adjusted cost-to-income ratio improved to 37.3%; compensation ratio at 20.8%.

Outlook and guidance

• Expectation of a stronger second half in sales and trading, with both client activity and risk allocation likely to improve.

• Anticipate continued ROE expansion, driven by strong business line performance and ramp-up in Banco Pan.

• Corporate lending growth expected to exceed 20% for the year.

• Retail funding as a percentage of total funding base expected to surpass 30% in the coming quarters.

• Management expects continued market share gains, robust credit portfolio growth, and further international expansion, supported by recent acquisitions.