Banco do Brasil (BB) had a record adjusted net income of R$ 21 billion in 2021, with a growth of 51.4% compared to 2020. profit totaled R$ 5.9 billion, up 60.5% over the same period of the previous year.
According to BB, the growth in profit can be explained by the drop in expenses with credit provisions (bank reserve to cover possible defaults). This item, which is computed as an expense in financial accounting, fell by 40.2% in 2021. At the beginning of the covid-19 pandemic, in 2020, banks had raised provisions to face a possible increase in default.
Other factors that helped increase the bank’s profit last year were the growth in the loan portfolio, the increase in service fees and the improvement in the gross financial margin. Administrative expenses remained stable.
In a note, the president of Banco do Brasil, Fausto Ribeiro, celebrated the growth in profit. “Our record profit has brought our profitability closer to that of private peers. The result we deliver reconciles return and solidity. It is a demonstration of our commitment to all shareholders,” he declared.
credit portfolio
Banco do Brasil’s expanded loan portfolio ended 2021 at R$874.9 billion, up 17.8% from 2020. The highlights were operations with individuals, agribusiness and private securities.
Regarding agribusiness, the expanded portfolio totaled R$ 248 billion last year, beating the record recorded in 2020. In the fourth quarter alone, growth totaled 9.9% compared to the previous quarter. Credit to individuals increased 4.5% in the same comparison.
The delinquency rate for more than 90 days of the bank’s credit operations was 1.75%, lower than the average for the National Financial System. The sustainable business portfolio, which includes loans to projects with a positive social and environmental impact, exceeded R$291 billion last year and corresponded to around one third of the bank’s total credit.
income and expenses
Revenues from services rendered totaled BRL 29.3 billion in 2021, up 2.2% when compared to 2020. The highlights were the fund management segments (+8.8%), insurance (+10.7 %), and consortia (+29.2%).
Administrative expenses increased by 1.4% last year, staying within the range of the 2021 corporate projections.
BB also released projections for 2022. For this year, the institution forecasts adjusted net income between R$ 23 billion and R$ 26 billion, expansion of 8% to 12% in the loan portfolio and growth of 4% to 8% both revenue from services rendered as well as administrative expenses.
Last year, the financial institution held a contest. Approved candidates have been called since November.
