In the third quarter of 2023, Bradesco reported net recurring profits of R$4,621 billion, representing a decrease of 11.5% compared to the same period of the previous year. Net accounting profit also followed the same trend, with a decrease of 11.3%, reaching R$4.621 billion. These results coincide with the averages forecast by LSEG, which expected a profit of R$4.68 billion.
The total credit portfolio amounted to R$877.5 billion, remaining almost unchanged compared to the third quarter of 2022, with a minimum negative variance of 0.01%. This performance was lower than the bank’s estimates, which expected an increase of 1 to 5% in the total loans granted.
Defaults on the rise: Which sectors are most affected?
Data for the third quarter showed an increase in default cases (delays of more than 90 days), as their percentage increased from 5.6%, an increase of 1.7 percentage points in 12 months, despite a decrease of 0.1 point compared to the second quarter. Small and medium enterprises have the highest default rate, at 7.2%, while individuals have a default rate of 6.6%. Among larger companies, default rates rose from 0.1% to 0.6% in a one-year period.
In response to the increase in defaults, Bradesco incurred expenses of R$9.2 billion with provisions for doubtful debts (PDD) in the third quarter, an increase of 26.4% compared to the same period last year. In the year to September, PDD totaled R$29 billion, an increase of 66.6%. However, Bradesco’s results report highlights that, compared to the second quarter, there was a 10.9% reduction in these expenses, indicating that newer loans are of better quality.
Despite the challenges related to the quality of the credit portfolio, Bradesco has a positive point, which is the increase in revenues from the services provided. This total amounts to R$9.1 billion in this quarter, representing an increase of 2.9% compared to the same period last year. Moreover, revenue from card income amounted to R$3.7 billion, although those related to the current account decreased by 9.5%, to R$1.7 billion.
With a decrease of 2.5% in the year-on-year comparison, the bank’s financial margin reached R$15.859 billion. Return on average shareholders’ equity was 11.3%, representing a decrease of 1.7 percentage points compared to the third quarter of last year.
Charlotte Whitmore is a contributor at Mediarunsearch.co.uk, covering a broad range of topics including news, politics, business, technology, sport, entertainment, and lifestyle. She focuses on delivering clear, balanced reporting and practical information that helps readers stay informed about current events and emerging developments. Her work highlights stories that matter to everyday audiences, with an emphasis on accuracy, relevance, and accessible journalism that keeps readers connected to the issues shaping the UK and beyond.