Banco Santander (Brasil) (SANB4) Q2 2025 earnings summary

Executive summary

• Net profit for Q2 2025 was R$3.7 billion, up 9.8%-10% year-over-year but down 5.2% sequentially, with ROAE at 16.4% (+0.8 p.p. YoY, -1.1 p.p. QoQ), reflecting a challenging macroeconomic environment and strong digital transformation.

• Customer base expanded 7% YoY to 71.7 million, with active customers at 34 million and primacy customers up 20%, alongside rising NPS scores, especially in digital channels.

• Strategic focus on efficiency, digital transformation, and customer-centric strategies, with technology and AI as key enablers for productivity and unified digital journeys.

• Business evolution centered on profitability, portfolio management, and disciplined capital allocation, with emphasis on high-income, consumer finance, and SME segments.

Financial highlights

• Net interest income was R$15.4 billion, down 3.3% QoQ but up 4.4% YoY; client NII grew 1.9% QoQ and 11.3% YoY, while market NII turned negative due to high Selic.

• Fee income rose 1.3% QoQ and 0.4% YoY, led by cards and asset management; total revenues reached R$20.6 billion, up 3.3% YoY.

• Expenses declined 2.5% QoQ but rose 1.5% YoY, with the efficiency ratio at 36.8%, the best in three years.

• Allowance for loan losses increased 7.4% QoQ and 16.4% YoY, reflecting higher cost of risk and regulatory changes.

• Expanded loan portfolio reached R$675.5 billion, down 1.0% QoQ but up 1.5% YoY, with disciplined growth in profitable lines.

Outlook and guidance

• Profitability target remains at 20%-21% ROE in coming years, with efficiency, technology, and digital transformation as main levers.

• Management expects continued growth in high-income, consumer finance, and SME segments, with selective risk-taking and active portfolio management.

• Fee income expected to grow at double-digit rates, supported by cards, insurance, and capital markets.

• Market NII expected to remain under pressure as long as Selic stays at 15%, with improvement anticipated if rates decline in 2026.