Banco Votorantim SA doubled its first-quarter profit from the year-ago as operating income rose significantly while loan losses and impairments dropped.

The Brazilian lender posted net income of 255 million reais for the first quarter, up from 127 million reais in the year-ago period.

Votorantim's net interest income rose 11.8% to about 1.35 billion reais in the first quarter from about 1.21 billion reais a year earlier. The lender's net interest margin expanded to 6.6% from 6.3% in the linked quarter and 5.3% a year ago.

The bank's operating income soared to 561 million reais, a 76.2% increase from the 318 million reais in the prior-year period. Income from services and banking fees rose 12.1% to 325 million reais from 290 million reais.

Loan loss and impairment costs slid 22.4% to 326 million reais from 420 million reais in the prior-year period. The ratio of loans 90 days past due to the bank's loan portfolio was 3.9% in the period, down from 4.0% in the linked quarter and 4.5% in the year-ago period.

Personnel and administrative expenses, however, rose 20.9% to 653 million reais from 540 million reais year over year.

Return on average equity stood at 11.8% in the quarter, up from 6.2% a year earlier, while return on average assets rose by 60 basis points to 1.1%. The bank's on-balance loan portfolio held about 48.19 billion reais as of March 2018, inching 2.7% higher than the 46.93 billion reais last year.

The company's Tier 1 capital ratio stood at 13.1% at March 31, compared to 11.4% three months earlier and 10.1% a year ago.

Banco Votorantim said that it will also continue in its strategy to diversify business and bank on its digital transformation especially with the launch of its innovation lab, and with its partnership with Neon Pagamentos, the former partner of troubled lender Banco Neon SA

As of May 9, US$1 was equivalent to 3.60 Brazilian reais.