Itau Unibanco Holding S.a. · BMFBOVESPA:ITUB3
Itau Unibanco — Q3 2017 Earnings Presentation
23 slides from Itau Unibanco's earnings presentation, Nov 3, 2017
Slide 1: Conference Call 3rd quarter 2017 – Earnings Review
Conference Call 3 rd quarter 2017 – Earnings Review Candido Botelho Bracher President and CEO Caio Ibrahim David Executive Vice-President, CFO and CRO Alexsandro Broedel Lopes Executive Finance Director and Investor Relations Officer Marcelo Kopel Executive Director
Slide 2: Pro Forma Information
Pro Forma Information The merger between Itaú Chile and CorpBanca was concluded on April, 1 st 2016. As from the second quarter of 2016, Itaú CorpBanca, the company resulting from this merger, was consolidated in our financial statements, as we are the controlling shareholder of the new bank. In ord
Slide 3: Main Challenges
Main Challenges Seeking excellence and value creation for all our stakeholders, we perceive as our main challenges: Focus on Clients Risk Management We must further increase the focus on clients, aligned with We must endeavor our efforts to fully comply with the Risk international best practices not
Slide 4: Profitability | Sustainable Performance
Profitability | Sustainable Performance Recurring Net Income (R$ billion) Stockholders’ Equity (R$ billion) Sep-12 57% Sep-17 9M12 9M17 79.0 123.6 76% 10.5 18.6 Dividends & Interest on Own Capital 1 net of taxes (R$ billion) 9M12 484% 9M17 Recurring ROE (%) 2.0 11.4 9M12 230 9M17 Value Creation (R$
Slide 5: Highlights
Highlights Recurring Net Income 3Q17/2Q17 9M17/9M16 Consolidated R$6.3 bn + 1.4% (3Q17/2Q17) Financial Margin with Clients: - 2.2% - 3.2% R$18.6 bn +13.9% (9M17/9M16) Brazil R$6.0 bn + 0.8% (3Q17/2Q17) Financial Margin with the Market: - 16.2% - 3.1% R$17.9 bn + 15.0% (9M17/9M16) Cost of Credit: - 1
Slide 6: Results
Results In R$ billions 3Q17 2Q17 9M17 9M16 Operating Revenues 27.0 27.2 -0.8% 81.5 82.5 -1.3% Managerial Financial Margin 16.8 17.4 -3.5% 51.6 53.3 -3.2% Financial Margin with Clients 15.4 15.8 -2.2% 46.7 48.3 -3.2% Financial Margin with the Market 1.4 1.6 -16.2% 4.8 5.0 -3.1% Commissions and Fees 8
Slide 7: Results – Brazil and Latin America
Results – Brazil and Latin America 9M17 9M16 Latin Latin Latin Consolidated Brazil 1 America Consolidated Brazil 1 America Consolidated Brazil 1 America In R$ billions (ex-Brazil) 2 (ex-Brazil) 2 (ex-Brazil) 2 Operating Revenues 81.5 74.8 6.6 82.5 75.4 7.1 -1.3% -0.8% -6.7% Managerial Financial Marg
Slide 8: Business Model
Business Model In R$ billions 9M17 9M16 Insurance Insurance Excess Insurance Excess Excess Consolidated Credit Trading Consolidated Credit Trading Consolidated Credit Trading and and Services Capital and Services Capital Capital Services Operating Revenues 81.5 42.1 1.4 35.9 2.1 82.5 44.0 1.9 35.0 1
Slide 9: Credit Portfolio
Credit Portfolio In R$ billions, end of period 3Q17 2Q17 3Q16 Individuals 179.9 179.4 0.3% 5 182. -1.4% Credit Card Loans 57.2 56.4 1.4% 55.7 2.6% Personal Loans 26.0 25.9 0.3% 27.9 -6.9% Payroll Loans 44.6 44.8 -0.5% 45.6 -2.3% Vehicle Loans 13.9 14.1 -1.5% 15.9 -12.7% Mortgage Loans 38.3 38.3 0.1%
Slide 10: Financial Margin with Clients
Financial Margin with Clients Annualized Average Rate 14.0% 14.1% 14.1% 14.1% 14.1% 13.8% 12.7% 11.1% 11.6% 11.0% 11.1% 10.9% 10.1% 10.5% 10.8% 10.3% 10.1% 10.3% 10.3% 7.4% 7.5% 9.2% 6.7% 6.1% 7.3% 7.4% 6.8% 6.6% 6.7% 6.1% 5.4% 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 Annualized average rate of
Slide 11: Financial Margin with the Market
Financial Margin with the Market In R$ billions 1.7 1.7 1.8 1.8 1.7 1.7 1.7 1.7 1.6 2.3 2.0 1.9 1.7 1.7 1.6 1.5 1.4 2.1 1.3 1.7 1.6 1.8 1.2 1.2 1.5 1.3 1.1 0.2 0.3 0.3 0.2 0.2 0.3 0.2 0.1 0.1 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 Financial Margin with the Market – Brazil1 Financial Margin wit
Slide 12: Credit Quality
Credit Quality 90-day NPL Ratio - Consolidated - % 15 to 90-day NPL Ratio - Consolidated - % 4.8 4.3 4.2 4.2 4.0 3.9 3.9 3.8 * 3.6 3.8 3.3 3.4 3.2 3.2 2.9 3.0 3.2 3.2 3.2 3.9 2.8 2.8 2.8 3.5 3.4 3.4 2.7 2.6 2.6 3.3 3.2 3.2 3.2 3.0 2.9 3.0 3.0 3.0 3.0 2.9 2.6 2.5 2.6 2.7 2.7 2.7 1.3 1.4 2.5 1.1 1.2 1
Slide 13: NPL Creation
NPL Creation In R$ billions 6.8 6.3 6.0 5.7 5.3 5.3 4.9 4.5 4.4 4.4 4.3 4.3 4.2 4.1 3.8 3.5 3.8 3.6 2.3 1.3 1.5 1.0 1.1 1.0 0.8 0.4 0.5 0.6 0.8 0.3 0.4 0.5 0.2 0.1 0.2 0.2 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 Total Retail Banking - Brazil Wholesale Banking - Brazil Latin America ex-Brazil It
Slide 14: 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 5.8% 4.3% 4.4% 4.6% 5.0% 5.0% 4.7% 4.5% 4.0% 4.0% 3.9% 4.3% 4.1% 3.6% 7.8 5.8 6.0 6.4 0.8 6.3 6.2 5.8 5.7 5.4 4.9 4.6 4.9 4.8 0.4 2.7 0.4 0.4 4.3 1 0.3 0.4 0.4 0.4 1.4 1.5 0.8 0.4 0.2 0.3 1.9 1.6 1.3 1.8
Slide 15: Total Allowance by Type of Risk – Consolidated
Total Allowance by Type of Risk – Consolidated In R$ Allocation of Total Allowance (*) by Type of Risk - Consolidated Regulatory Breakdown 39.1 36.6 37.4 36.6 Complementary Expected and/or Allowance Potential Loss Retail – Brazil1 5.8 8.7 Related to expected loss in Retail segment Wholesale –Brazil1
Slide 16: Coverage Ratio (90-day NPL)
Coverage Ratio (90-day NPL) Coverage Ratio and Expanded Coverage Ratio Coverage Ratio 932% 715% 246% 345% 243% 231% 245% 241% 222% 212% 210% 215% 228% 206% 204% 159% 166% 164% Without CorpBanca With Itaú CorpBanca 100% 102% 104% 104% 104% 104% 101% 100% 97% Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16
Slide 17: Commissions & Fees and Result from Insurance
Commissions & Fees and Result from Insurance In R$ billions 3Q17 2Q17 9M17 9M16 Credit Cards 3.1 3.0 2.8% 9.1 9.0 0.5% Current Account Services 1.7 1.7 1.2% 5.0 4.7 6.3% Asset Management¹ 0.9 0.8 14.2% 2.6 2.2 19.0% Credit Operations and Guarantees Provided 0.8 0.8 0.4% 2.5 2.4 5.2% Collection Servi
Slide 18: Non-Interest Expenses
Non-Interest Expenses In R$ billions 3Q17 2Q17 9M17 9M16 Personnel Expenses (5.0) (5.0) 0.6% (14.8) (14.8) -0.3% Administrative Expenses (4.0) (4.0) -0.2% (11.7) (11.6) 1.4% Personnel and Administrative Expenses (9.0) (9.0) 0.3% (26.5) (26.4) 0.4% Operating Expenses (1.4) (1.3) 9.9% (3.7) (3.8) -3.5
Slide 19: Core Capital Ratio (Common Equity Tier I)
Core Capital Ratio (Common Equity Tier I) Changes in the Core Capital Ratio 15.7% 0.8% -0.2% 0.1% 0.2% 0.1% 16.7% Common Equity 3Q17 Dividends and Interest on Other changes in Tax Credits Risk-Weighted Assets Common Equity Tier I Jun-17 Net Income Own Capital stockholder's equity Tier 1 Sep-17 Full
Slide 20: Capital Management
Capital Management In order to manage capital efficiently, aiming at creating value to our shareholders, we announced through a Material Fact disclosed on September 26, 2017, that we intend to: · Maintain the practice of paying dividends and interest on own capital at 35% of net income, however we e
Slide 21: 2017 Forecast
2017 Forecast We kept unchanged the ranges of our 2017 forecast. Consolidated 1 Brazil 1, 2 Total Credit Portfolio 3 From 0.0% to 4.0% From -2.0% to 2.0% Financial Margin with Clients 4 From -4.2% to -0.8% From -5.2% to -1.8% (ex-Impairment and Discounts Granted) Cost of Credit 5 Between R$15.5 bn a
Slide 22: Acquisition of Citibank’s Retail Business in Brazil
Acquisition of Citibank’s Retail Business in Brazil On October 26, we announced that we obtained the final regulatory authorization required for the acquisition of Citibank’s retail business (for individuals) in Brazil. This transaction includes loans, deposits, credit cards, branches, asset managem
Slide 23: Conference Call 3rd quarter 2017 – Earnings Review
Conference Call 3 rd quarter 2017 – Earnings Review Candido Botelho Bracher President and CEO Caio Ibrahim David Executive Vice-President, CFO and CRO Alexsandro Broedel Lopes Executive Finance Director and Investor Relations Officer Marcelo Kopel Executive Director
Itau Unibanco Holding — Q3 2017 Earnings Presentation on 6ix