Banco do Estado do Rio Grande do Sul (BRSR6) Q1 2026 earnings summary

Executive summary

• Net income for Q1 2026 was BRL 221.6 million, down 8.2% year-over-year, mainly due to higher credit risk losses and moderate administrative expense growth, despite a stronger financial margin and lower provisions.

• Loan portfolio grew 1.3% year-over-year to BRL 64.3 billion, with commercial loans comprising 60.9% of the total.

• Funding increased 13% year-over-year to BRL 111.3 billion, supporting financial stability.

• Management resolved major funding mismatches, reducing the gap from BRL 20 billion to BRL 4 billion, and reduced labor lawsuit liabilities through agreements covering 40% of affected employees.

• The bank expanded its corporate segment, launched new digital solutions, and focused on operational efficiency and risk mitigation.

Financial highlights

• Net interest income rose 12.5% year-over-year to BRL 1.7 billion, driven by higher interest income and Selic rates.

• Administrative expenses increased 6.4% year-over-year, mainly due to higher personnel costs.

• Service fee income was BRL 525.2 million, up 0.7% year-over-year.

• Efficiency ratio improved to 57.1% from 64.8% a year earlier.

• Expected net losses related to credit risk increased 62.1% year-over-year to BRL 542.5 million.

Outlook and guidance

• Management expects asset quality indicators to stabilize, with delinquency rates likely peaking and a slight decrease anticipated.

• 2026 guidance maintained: loan portfolio growth of 3–8%, financial margin up 8–13%, credit cost at 1.2–2.2%, and administrative expenses up 5–9%.

• Guidance may be revised in the second half of the year, but capital and payout policies are expected to remain stable.