Santander Brasil Profit Rises Slightly, As Provisions Charges Increase
April 27 2016 - 7:33AM
Dow Jones News
By Rogerio Jelmayer
SAO PAULO--The Brazilian unit of Spanish bank Banco Santander
posted a net profit increase of just 1.7% in the first quarter, as
the bank was obligated to assume more provisions to cover bad
loans.
Banco Santander Brasil SA's net profit totaled 1.66 billion
reais ($476 million) in the first quarter, up from BRL1.63 billion
in the year-ago period.
Meanwhile, bank's provision expenses for bad loans increased
nearly 18% to BRL3.03 billion in the period.
The increase in provisions came as Brazil's economic recession
deepened and economists expect the country's labor market to
deteriorate. After contracting 3.8% last year, economists expect
Brazil's economy to shrink at the same level this year.
With a poor economy, Brazilians shows little appetite for new
loans. Santander's loan portfolio dropped 3.8% to BRL312 billion at
the end of the first quarter, versus the year-ago period.
The lender's nonperforming loan rate covering loans that were
more than 90 days overdue ended the first quarter at 3.3%, up from
3% in the first quarter of 2015.
The banks figures were published using Brazil's generally
accepted accounting principles.
Write to Rogerio Jelmayer at rogerio.jelmayer@wsj.com
(END) Dow Jones Newswires
April 27, 2016 07:18 ET (11:18 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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