Brazilian Financial Institutions: 2Q26 sentiment tracker: Asset quality is the key concern

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Brazilian Financial Institutions: 2Q26 sentiment tracker: Asset quality is the key concern

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Brazilian Financial Institutions

2Q26 sentiment tracker: Asset quality is

the key concern

Industry Overview

Investors neutral on banks and under on nonbanks 24 July 2026

Our survey indicates that investors have become more bearish on the Ibovespa for 2026, Equity

reflecting expectations of a higher-for-longer interest rate environment. Investors we Brazil

surveyed remained underweight on nonbanks but increased positioning on banks to Financial Institutions

neutral from underweight. We surveyed 30 investors between July 20 and 23.

Mario Pierry

BPAC is most owned, followed by NU and ITUB ResearchBofAS Analyst

BPAC has become the preferred stock among investors we surveyed, up from second +1mario.pierry@bofa.com646 743 0047

place last quarter. On the other hand, allocation on NU and ITUB declined, although they Antonio Ruette >>

are the second most owned names. XP had one of the sharpest increases in positioning Research Analyst

Merrill Lynch (Brazil)

from last quarter, despite the more risk-averse scenario – likely reflecting discounted +55 11 2188 4225

valuation following the underperformance YTD – it is now the fourth most owned stock. antonio.ruette@bofa.com

Finally, allocation on BBDC and B3 declined. Exhibit 4. Augusto Uehara >>

Research Analyst

BBAS and BBSE remain least preferred Merrill+55 11Lynch2188 (Brazil)4651

BBAS and BBSE continue to be the most underweight names among investors, although augusto.uehara@bofa.com

investors became less bearish on the names. On the other hand, SANB, B3 and PSSA Ernesto Gabilondo >> Research Analyst

saw the sharpest QoQ increases in underweight positions. Exhibit 5. Merrill Lynch (Mexico)

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