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Report: Bradesco CEO rules out delisting of Brazilian card processor Cielo

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Report: Bradesco CEO rules out delisting of Brazilian card processor Cielo

Banco Bradesco SA CEO Octávio de Lazari has ruled out the delisting of card processor Cielo SA from the stock market, Reuters reported.

Brazil's leading electronic payment company has suffered from the rapid growth of competitors in the sector, with the company's shares dropping about 60% in 2018. The company reported a 20.1% decline in third-quarter profit as financial income shrank 38.8% while operating expenses increased 17.0%.

Despite these trends, Cielo remained a good investment, Lazari told reporters Dec. 14, noting that the company's current market pricing did not reflect its future value for the shareholders with the expected growth of the Brazilian economy in 2019.

In addition, the company, which Bradesco controls in partnership with state-owned Banco do Brasil SA, carried out a plan to sell payment terminals under the names of the two banks, selling some 370,000 terminals at the former bank alone, which boosted its position among competitors, according to de Lazari.

"In relation to the future of [Cielo], the acquiring market is 'core business' for the bank," Cielo Chairman Marcelo Noronha said, according to a separate report by Valor Econômico. "The company has scale, is competitive, but we have to rethink how to do business."