Banco BTG Pactual SA (BPAC11.SA): Multiple engines sustaining ROE - 2Q26 Results

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11 Aug 2026 06:25:53 ET │ 12 pages

Banco BTG Pactual SA (BPAC11.SA)

Multiple engines sustaining ROE - 2Q26 Results

CITI'S TAKE

Buy

Price (10 Aug 26 18:00)

R$53.86

Target price

R$70.00

Expected share price return

30.0%

Expected dividend yield

3.0%

Expected total return

32.9%

Market Cap

R$209,517M

US$41,002M

BTG Pactual reported adjusted earnings of R$5.1bn, +5% and +6% vs. Citi

and Bloomberg consensus, for an ROE of 26.7% (vs. 26.6% in 1Q26).

Revenues reached a record R$10.4bn (+4%QoQ, +13%YoY), driven by

Corporate Lending, Consumer Finance and recurring fee businesses, more

than offsetting weaker IB activity. Corporate Lending revenues reached a

record R$2.5bn, supported by a loan portfolio of R$288bn (+21%YoY),

while Consumer Finance revenues increased 37%QoQ on better spreads,

portfolio growth and the contribution from MeuTudo, which started being

incorporated in 2Q26. IB remained soft amid weaker DCM activity. Asset

and Wealth Management posted combined NNM of R$59bn, taking

AuM/WuM to R$2.7tn. Basel ratio improved slightly to 16.0%. Notably,

daily VaR declined further to 0.22% from 0.32% QoQ. Of note, asset

quality deteriorated with Stage 2 and Stage 3 exposures representing

6.8% vs. 6.5% in 1Q26.

Gustavo SchrodenAC

Implications — Another quarter reinforcing BTG’s ability to compound earnings

through scale rather than market tailwinds. The key takeaway, in our view, is not the

earnings beat itself but the changing profit mix: IB continues to normalize from peak

levels, yet credit, funding and recurring fees are increasingly filling the gap, making

profitability structurally less dependent on capital markets cycles. Corporate

Lending again delivered record revenues while maintaining healthy spreads,

underscoring ongoing market-share gains. Meanwhile, the sharp acceleration in

Consumer Finance partly reflects the first-time recognition of BTG’s 48% stake in

MeuTudo, but also highlights management’s strategic push into higher-growth

lending verticals. Looking ahead, improving DCM activity, the HSBC Uruguay

integration and continued monetization of recent acquisitions could provide

incremental earnings drivers into 2H26.…