On Wednesday, Santander Brasil reported a 75% increase in net profit for the fourth quarter, exceeding market expectations due to improved margins and higher fees. The bank's net profit reached 3.85 billion reais ($668.62 million), surpassing analysts' forecast of 3.72 billion reais.
Following the strong earnings report, shares of Santander Brasil in Sao Paulo surged over 4.5%, making it one of the top gainers on the local stock index Bovespa, which experienced a 0.3% decline.
Santander's Chief Executive Mario Leao emphasized that the fourth-quarter results reflected their strategy's success, showcasing positive revenue growth and steady expansion in client net interest income. Analysts at XP Investimentos viewed the results positively, noting the bank's ability to maintain consistent performance despite challenging macroeconomic conditions.
Santander, being the first major private bank in Brazil to release quarterly results, now sets the stage for its peers, like Itau Unibanco and Bradesco, whose reports are impending.
Additionally, the bank recently announced 10 billion euros ($10.42 billion) in share buybacks after achieving record profits, supported by its retail business in Brazil. Santander Brasil saw its net interest income rise by 16% in the fourth quarter, reaching 15.98 billion reais, while its return on average equity increased to 17.6%.
Looking ahead, Mario Leao expressed readiness to continue advancing the bank's profitability with prudent capital allocation. The bank's loan loss allowances decreased by 13.2% year-on-year to 5.93 billion reais, remaining within anticipated levels, as its loan portfolio expanded by 6.2% to 682.7 billion reais.