Banco do Brasil (BBAS3) Q3 2024 earnings summary

Executive summary

• Adjusted net income reached R$28.3 billion in 9M24, up 8.4% year-over-year, with Q3 2024 at R$9.5 billion, up 8.3% from Q3 2023, and ROE at 21.5%.

• Loan portfolio expanded 13% year-over-year to over R$1.2 trillion, with strong growth across payroll, corporate, and agribusiness segments.

• Value added to society totaled R$63.4 billion in 9M24.

• Focus on hyper-personalization, digital transformation, and ESG initiatives, including R$36 billion in sustainable funding over three years.

• Total assets reached R$2.47 trillion, up 13.7% year-over-year.

Financial highlights

• Net interest income rose 13.9% year-over-year to R$77.2 billion in 9M24; fee income increased 4.8% to R$26.3 billion.

• Administrative expenses grew 4.9% to R$27.5 billion in 9M24; cost-to-income ratio at a historic low of 25.4%.

• Payroll loans grew 11.2% year-over-year, with INSS payroll loans up 21% and private payroll loans up 23%.

• Corporate loan portfolio expanded 13.5% to over R$421 billion; agribusiness portfolio reached R$386 billion, up 13.7% year-over-year.

• R$163 billion in credit disbursement in Q3 2024; sustainable loan portfolio reached R$369.6 billion, 31% of total loans.

Outlook and guidance

• 2024 guidance: adjusted net income R$37–40 billion, loan portfolio growth 8–12%, NII growth 10–13%, fee income growth 4–8%.

• NPLs in agribusiness expected to normalize to around 1.7% in 2025 as provisions stabilize.

• Guidance maintained for net income and financial margin despite increased provisions; focus on expense control and revenue diversification.

• Sustainable ROE targeted around 20% or high teens.

• Management confirmed ability to continue as a going concern, with no material uncertainties identified.