Banco Santander (Brasil) (SANB4) Q4 2024 earnings summary

Executive summary

• Net profit reached R$3.9 billion in 4Q24, up 5.2% sequentially and 74.9% year-over-year, with ROE/ROAE at 17.6%, reflecting strong profitability and disciplined capital allocation.

• Full-year net income was BRL 13.9 billion, up 48% year-over-year, with ROE close to 17% and core capital at 11%.

• Customer base grew by 2.2 million active clients, an 8% increase to 69.5 million, with primacy customers up 15% YoY, driven by digital transformation and hyper-personalization.

• The year marked the consolidation of a transformation strategy, with advances in digitalization, client primacy, and portfolio diversification.

• Efficiency ratio improved to 38.0% in 4Q24, a 5.0 p.p. YoY reduction, reflecting effective cost management and productivity gains.

Financial highlights

• Net interest income (NII) rose to R$16.0 billion in 4Q24 (+4.9% QoQ, +16.0% YoY), with client NII up 13.7% YoY, driven by asset and liability management.

• Fee income reached R$5.5 billion (+3.4% QoQ, +10.1% YoY), led by cards, current accounts, and consórcios.

• Total revenues reached R$21.49 billion, up 4.5% sequentially and 14.4% year-over-year.

• Allowance for loan losses was R$5.9 billion, up 0.8% QoQ but down 13.2% YoY, with recurring cost of risk at 3.5%.

• Efficiency ratio improved by 5 percentage points for the year, with expenses growing below inflation.

Outlook and guidance

• Growth agenda remains, with selective, disciplined expansion focused on profitability, portfolio quality, and sustainable growth.

• Expect continued advances in digitalization, client experience, and technology, with the launch of OneApp in 2025.

• Management anticipates a more challenging macroeconomic environment in 2025, with ongoing adjustments to credit and risk policies.

• ROE/ROAE target remains at 20% in the medium term, with ongoing focus on efficiency and cost-to-serve reductions.

• Regulatory changes in 2025 (CMN Resolution No. 4,966/2021, IFRS 9 convergence) expected to increase provisions by ~R$4.4 billion and reduce equity by R$2.5 billion.