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$5.99bn, up 10% year-over-year, with ROAE at 22.5% and total assets rising to R$600.4bn.

• Robust performance across investment banking, corporate lending, asset management, and wealth management, supported by business and geographic diversification, with net new money inflows of R$56bn and AuC reaching R$1.7tn, up 23% year-over-year.

• Funding base expanded by 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.

• The independent auditor issued an unqualified opinion, confirming fair presentation of financial statements.

Financial highlights

• 2Q 2024 total revenues reached R$6.0bn, up 10% year-over-year; adjusted net income was R$2.9bn, up 15% year-over-year; net income per share (basic and diluted) was BRL 0.49.

• For the first half of 2024, total revenues reached BRL 11.88 billion and net income grew 21% year-over-year to BRL 5.84 billion.

• Shareholders' equity increased to R$53.1bn, up 2.1% sequentially and 13.6% year-over-year.

• Cost-income ratio remained below historical average at 37.3% for the quarter; compensation ratio at 20.8%.

• Unsecured funding base grew 30% year-over-year to R$236bn; credit portfolio increased 27% to R$195bn.

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.