Itau Unibanco Holding S.a. · BMFBOVESPA:ITUB3
Itau Unibanco — Q2 2018 Earnings Presentation
25 slides from Itau Unibanco's earnings presentation, Aug 2, 2018
Slide 1: Conference Call 2nd quarter 2018 - Earnings Review
Conference Call 2nd quarter 2018 - Earnings Review Candido Botelho Bracher President and CEO Caio Ibrahim David Executive Vice-President, CFO and CRO Alexsandro Broedel Executive Finance Director and Head of Investor Relations Marcos Magalhães Merchant Acquirer Executive Director 1
Slide 2: Managerial Income Statement
Managerial Income Statement As from the first quarter of 2018, we have started to present Citibank’s retail operations in Brazil line by line in our managerial income statement. As from the second quarter of 2016, Itaú CorpBanca, the company resulting from the merger between Banco Itaú Chile and Cor
Slide 3: Highlights
Highlights Performance Indicators Capital Ratios – BIS III 1 Credit Quality Net Income Tier I Capital NPL90 R$6.4 billion - 0.6% (2Q18/1Q18) 14.2% - 30 bps (Jun-18 / Mar-18) 2.8% - 30 bps (Jun-18 / Mar-18) R$12.8 billion + 3.7% (1H18/1H17) + 70 bps (Jun-18 / Jun-17) - 40 bps (Jun-18 / Jun-17) ROE (p
Slide 4: Results
Results In R$billions 2Q18 1Q18 1H18 1H17 Operating Revenues 28.0 27.4 54.5 1.8% 2.2% 55.4 Managerial Financial Margin 17.3 17.0 1.7% 34.3 34.8 -1.5% Financial Margin with Clients 16.0 15.3 4.5% 31.2 31.3 -0.3% Financial Margin with the Market 1.3 1.7 -22.8% 3.1 3.5 -11.8% Commissions and Fees 8.7 8
Slide 5: Recurring Net Income and ROE
Recurring Net Income and ROE In R$billions 22.0% 21.5% 21.6% 21.9% 22.2% 21.6% 20.7% 16.0% 15.5% 14.5% 14.0% 14.0% 13.5% 13.5% 5.8 6.2 6.2 6.3 6.3 6.4 6.4 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 Recurring Net Income Annualized Recurring Return on Average Equity (quarterly) - Consolidated Cost of Equity I
Slide 6: Business Model
Business Model In R$billions 1H18 1H17 Insurance Excess Insurance Excess Insurance Excess Consolidated Credit Trading and Consolidated Credit Trading and Consolidated Credit Trading and Capital Capital Capital Services Services Services Operating Revenues 55.4 28.4 0.9 25.2 1.0 54.5 28.3 1.0 23.7 1.
Slide 7: Credit Portfolio
Credit Portfolio In R$billions, end of period 2Q18 1Q18 2Q17 191.4 1.9% 179.4 8.7% Individuals 195.0 Credit Card Loans 66.1 65.0 1.7% 56.4 17.2% Personal Loans 28.3 27.4 3.5% 25.9 9.6% Payroll Loans 45.4 44.7 1.6% 44.8 1.4% Vehicle Loans 14.7 14.3 2.4% 14.1 3.9% Mortgage Loans 40.5 40.0 1.3% 38.3 5.
Slide 8: Credit Origination and Private Securities Issuance | Brazil
Credit1 Origination and Private Securities Issuance | Brazil Base 100 = 2Q14 Total Credit2 – Brazil Credit2 - Individuals YoY (%) YoY (%) -4% -24% 21% 24% -9% -22% 13% 14% 100 91 80 91 111 71 100 96 89 73 2Q14 2Q15 2Q16 2Q17 2Q18 2Q14 2Q15 2Q16 2Q17 2Q18 Credit2 – Very Small, Small Credit2 – Corpora
Slide 9: Net Interest Margin and Financial Margin with Clients
Net Interest Margin and Financial Margin with Clients Annualized Average Rate Consolidated Brazil 6% 12.3% 12.0% 12.0% 12.2% 10.5% 10.8% 10.3% 10.3% 10.1% 9.9% 9.9% 9.9% 9.2% 8.9% 9.0% 9.5% 6.8% 6.7% 7.3% 7.4% 7.1% 7.4% 7.6% 6.6% 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q17 4Q17 1Q18 2Q18 Annualized
Slide 10: Financial Margin with the Market
Financial Margin with the Market In R$billions 1.7 1.7 1.7 1.8 1.8 1.7 1.6 1.6 1.5 1.4 1.7 1.5 1.7 2.0 1.9 1.6 1.7 1.4 1.4 0.1 1.3 1.5 1.8 1.7 1.6 1.2 1.3 1.1 1.2 1.3 0.9 0.3 0.3 0.3 0.2 0.3 0.5 0.1 0.2 0.2 0.2 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 Sale of B3 Shares Financial Margin with
Slide 11: Credit Quality
Credit Quality 90-day NPL Ratio - Consolidated -% 15 to 90-day NPL Ratio - Consolidated -% 6 3.3 2 3.2 2.9 3.0 2.9 3.1 2.8 2.7 2.8 2.8 2.7 2.7 2.7 1 2.7 2.7 2.7 2.6 2.5 16 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Brazil1 Latin America2 90-day NPL Ratio - Brazil 1 -% 15 to 90-day NPL Ratio - Brazil
Slide 12: NPL Creation
NPL Creation 6.8 In R$billions 5.3 5.3 4.9 5.0* 4.4 4.4 4.4 3.8 4.2 4.1 3.8 3.8 3.6 3.5 2.3 3.5 3.3 3.2 1.1 0.8 1.0 0.5 0.5 1.1* 0.4 0.8 0.7 0.5 0.1 0.4 0.5 0.2 0.2 0.5 -0.3 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 Total Retail Banking - Brazil Wholesale Banking - Brazil Latin America ex-Brazil
Slide 13: Provision for Loan Losses and Cost of Credit
Provision for Loan Losses and Cost of Credit Provision for Loan Losses by Segment In R$billions .6% 3.7% 3.3% 3.4% 4.3 4.5 4.1 4.3 0.5 0.7 0.6 0.6 0.5 0.2 0.4 0.2 3.2 3.5 3.2 3.5 3Q17 4Q17 1Q18 2Q18 Losses / Loan portfolio (*) – Annualized (*) Average balance of the loan portfolio, considering the l
Slide 14: Coverage Ratio (90-day NPL)
Coverage Ratio (90-day NPL) Coverage Ratio and Expanded Coverage Ratio Coverage Ratio 952% 715% 2 618% 245% 220% 204% 166% 169% 169% ¹ Expanded Coverage Ratio is calculated from the division of the total allowance balance* by the sum of 90 days overdue operations and of renegotiated loan portfolio e
Slide 15: Commissions & Fees and Result from Insurance
Commissions & Fees and Result from Insurance In R$billions 2Q18 1Q18 1H18 1H17 Credit Cards 3.0 3.1 -2.8% 6.2 6.0 3.7% Current Account Services 1.8 1.8 0.1% 3.6 3.3 9.2% Asset Management¹ 1.1 1.0 9.1% 2.1 1.7 26.4% Credit Operations and Guarantees Provided 0.8 0.8 0.2% 1.7 1.7 1.7% Collection Servic
Slide 16: Non-Interest Expenses
Non-Interest Expenses In R$billions 2Q18 1Q18 1H18 1H17 Personnel Expenses (5.1) (4.9) 3.3% (10.0) (9.8) 2.5% Administrative Expenses (4.0) (3.7) 6.7% (7.7) (7.8) -1.3% Personnel and Administrative Expenses (9.0) (8.6) 4.8% (17.7) (17.5) 0.8% Operating Expenses (1.2) (1.1) 6.0% (2.3) (2.3) -2.1% Oth
Slide 17: Capital Ratios
Capital Ratios Full application of Basel III rules │June 30, 2018 (1) 0.4% 14.2% 1.0% 13.2% (3) AT1 issued Tier I Capital (2) Mar-18 (4) Jun-18 Common Equity Tier I (CET I) Additional Tier I (AT1) (1) The impact of 0.6% represents AT1 issued. (2) Includes deductions of Goodwill, Intangible Assets (g
Slide 18: Digital Transformation
Digital Transformation Use of Digital Channels Individuals 10.3 Companies number of current account holders number of current account holders (in millions) (in millions) 9.1 0.9 1.0 8.1 jun-16 jun-17 jun-18 jun-16 jun-17 Note: Number of retail current account holders that use Internet, mobile or SMS
Slide 19: Distribution of Added Value in the 2Q18
Distribution of Added Value in the 2Q18 RENTAL PAYMENTS R$0.4 billion 2% 18% TAXES, 33% R$18.3 FEES AND CONTRIBUTIONS billion R$6.0 billion 29% EMPLOYEES R$5.2 billion REINVESTMENTS R$3.3 billion SHAREHOLDERS R$3.4 billion 18% 3% 14% Controllers Free Float 1% approximately Non- 130 thousand Controll
Slide 20: 2018 Forecast
2018 Forecast We kept unchanged the ranges of our 2018 forecast. 2018 forecast considers Citibank’s retail operations. Therefore, 2017 income statement basis for 2018 forecast must consider Citibank’s figures in all lines of the income statement and also in the credit portfolio.* Consolidated Brazil
Slide 21: 2018 APIMEC Meeting in São Paulo
2018 APIMEC Meeting in São Paulo Wednesday, September 12th at 2:00 p.m. Hotel Unique – Espaço de Eventos Av. Brigadeiro Luiz Antônio, 4700. Jardim Paulista – São Paulo – SP The presentation will be transmitted via website www.itau.com.br/investor-relations, including simultaneous translation into En
Slide 22: Appendix
Appendix 22
Slide 23: Results – Brazil and Latin America 2Q18
Results – Brazil and Latin America 2Q18 Latin In R$billions Consolidated Brazil 1 America (ex-Brazil) 2 Operating Revenues 28.0 25.1 3.0 Managerial Financial Margin 17.3 15.1 2.2 Financial Margin with Clients 16.0 14.2 1.7 Financial Margin with the Market 1.3 0.9 0.5 Commissions and Fees 8.7 8.0 0.7
Slide 24: Total Allowance by Type of Risk – Consolidated
Total Allowance by Type of Risk – Consolidated Allocation of Total Allowance(*) by Type of Risk - Consolidated In R$billions Regulatory Breakdown 36.1 37.4 36.7 36.1 Expected and/or Complementary Allowance Potential Loss Related to expected Retail - Brazil1 6.0 7.6 9.4 17.2 16.1 16.1 loss in Retail
Slide 25: Conference Call 2nd quarter 2018 - Earnings Review
Conference Call 2nd quarter 2018 - Earnings Review Candido Botelho Bracher President and CEO Caio Ibrahim David Executive Vice-President, CFO and CRO Alexsandro Broedel Executive Finance Director and Head of Investor Relations Marcos Magalhães Merchant Acquirer Executive Director
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