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Banrisul's Q2 income slips 6.8% YOY

Banco do Estado do Rio Grande do Sul SA, or Banrisul, on Aug. 14 posted net income of 187.7 million Brazilian reais for the second quarter of 2017, about 6.8% lower than the 201.5 million reais earned in the second quarter of 2016.

The income translated to earnings per share of 45 centavos, compared to 49 centavos in the year-ago period.

Recurring net income for the quarter slipped to 184.1 million reais from 201.5 million reais a year earlier. The variations between accounting and recurring net income reflected a positive impact of 6.5 million reais from a voluntary retirement plan implemented in February, which negatively impacted first-quarter earnings by 99.7 million reais.

Net interest income grew slightly to about 1.28 billion reais for the quarter, compared to 1.27 billion reais a year earlier. Banrisul's net interest margin was 8.51% for the same quarter, down from 8.78% a year earlier. Meanwhile, income from services and fees fell slightly to 423.9 million reais from 426.6 million reais.

Recurring administrative expenses totaled 930.5 million reais, up 8.2% year over year from 860.2 million reais. Allowance for loan losses were up 10% annually to 339.9 million reais, from 309.0 million reais.

Past due loans over 90 days as a ratio of the total portfolio stood at 4.72% in the quarter, down from 4.81% a year earlier.

Recurring return on average assets was 1.1% for the quarter, compared to 1.2% a year earlier. Recurring return on average equity was 11.7% for the same period, compared to 13.2% in the prior-year period.

Banrisul's total credit portfolio held about 30.91 billion reais at the end of June 2017, up from 29.80 billion reais at the end of June 2016.

As of Aug. 11, US$1 was equivalent to 3.18 Brazilian reais.