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Banrisul's Q3 profit rises 31.6% as loan-loss allowances, NPLs decline

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Banrisul's Q3 profit rises 31.6% as loan-loss allowances, NPLs decline

Banco do Estado do Rio Grande do Sul SA's third-quarter net income rose 31.6% year over year amid a decline in loan-loss allowances and nonperforming loans.

The Brazil-based state bank recorded net income of 290.2 million reais in the three months ending Sept. 30, up from 220.5 million reais in the third quarter of 2017. Earnings per share reached 71 centavos in the quarter, up from 55 centavos in the previous year.

Net interest income came to 1.43 billion reais, up 6.8% from 1.34 billion reais in the linked quarter and rising 12.2% from the year ago's 1.27 billion reais. Income from services and fees also rose to 465.2 million reais from 440.1 million reais a year ago.

Third-quarter net interest margin on profitable assets was at 8.73%, compared to 8.31% in the previous year.

Recurring administrative expenses grew to 960.0 million reais from 900.8 million reais in the earlier year. On the other hand, allowance for loan losses expenses slid to 247.6 million reais from 375.8 million reais a year ago.

Banrisul's total credit portfolio hit 31.74 billion reais at the close of the third quarter, up 4.1% from 30.49 billion reais in the year-ago period.

The bank's 90-day past-due loans declined to 924.0 million reais at the end of September from 1.08 billion reais in the previous quarter and 1.31 billion reais a year ago. Meanwhile, the 90-day default ratio fell to 2.91% from 3.37% in the linked quarter and 4.30% in the third quarter of 2017.

Annual return on average assets rose to 1.5% in the third quarter from 1.2% a year ago. Annual return on average equity also improved to 17.3% from 13.9%.

As of Nov. 12, US$1 was equivalent to 3.76 Brazilian reais.