Itaú Unibanco (ITUB4) Q4 2023 earnings summary

Executive summary

• Q4 recurring managerial result was R$9.4bn, up 4.0% QoQ and 22.6% YoY; recurring managerial ROE reached 21.2%.

• FY2023 recurring managerial result was R$35.6bn versus R$30.8bn in 2022; recurring managerial ROE was 21.0%.

Financial highlights

• Q4 operating revenues were R$41.0bn, up 3.7% QoQ; FY2023 operating revenues were R$156.8bn, up 9.9% YoY.

• Q4 financial margin with clients was R$26.3bn, up 2.9% QoQ and 8.5% YoY; commissions and insurance totaled R$13.5bn, up 4.6% QoQ.

• Q4 cost of credit was R$9.2bn; FY2023 cost of credit totaled R$36.9bn.

Outlook and guidance

• FY2024 guidance: credit portfolio growth 6.5%–9.5%; client financial margin growth 4.5%–7.5%; market margin R$3.0bn–R$5.0bn; cost of credit R$33.5bn–R$36.5bn.

• FY2024 guidance: commissions and insurance growth 5.0%–8.0% on a comparable basis; non-interest expense growth 4.0%–7.0%, with core expenses below inflation; effective tax rate 29.5%–31.5%.

• Brazil 2024 outlook: GDP growth 1.8%, year-end Selic 9.00%, IPCA inflation 3.6%, formal job growth 8.0%, and year-end dollar at 4.90.