Brazil Diversified Banks: 18th Citi Brazil Equity Conference: Banks Takeaways - A Cautious Tone

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Brazil Diversified Banks: 18th Citi Brazil Equity Conference: Banks Takeaways - A Cautious Tone

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18 Jun 2026 22:24:29 ET │ 12 pages

Brazil Diversified Banks

18th Citi Brazil Equity Conference: Banks Takeaways - A Cautious Tone

CITI'S TAKE

Gustavo Schroden AC

We see a clear shift towards caution in the Brazilian banking sector as +55-11-4009-5858

institutions confront a more challenging macroeconomic backdrop and gustavo.schroden@citi.com

higher interest rates. Banks are broadly prioritizing risk-adjusted returns

and asset quality, resulting in more selective origination and moderate Brian Flores, CFA

growth outlooks. This defensive posture benefits conservative players like +55-11-4009-2842

Itau, which expects stable NPLs, while creating uncertainty for others like luis.brian.flores@citi.com

Banco do Brasil due to potential government programs for rural loans.

Nevertheless, diversified platforms such as BTG Pactual and BR Partners Arnon Shirazi, CFA

project resilient ROE above 25% and 20%. This contrasts with the more +55-11-4009-7906

lukewarm with expected mixed trends from traditional players like arnon.shirazi@citi.com

Santander and Bradesco.

Incumbent Banks Prioritize Caution — Itau Unibanco's conservative approach is

paying off with stable NPLs expected. Bradesco's revenues should advance

gradually, prioritizing risk-adjusted returns. Santander Brasil also maintains a

cautious stance, targeting mid-single-digit portfolio growth. Conversely, Banco do

Brasil faces limited visibility on asset quality, awaiting a government program that

has created a 'moral hazard' effect among producers.

Investment Banks Navigate Headwinds — BTG Pactual remains confident in its

diversified model, projecting a ROE above 25% despite macro headwinds. BR