Banco do Estado do Rio Grande do Sul SA reported net income of 516.4 million Brazilian reais for the fourth quarter of 2017, up from the 165.0 million reais reported for the year-ago period, as the bank's expenses slid.

Net interest income grew to 1.43 billion reais in the quarter, from 1.34 billion reais a year earlier. The bank's net interest margin stood at 9.21% in the quarter, slightly down from 9.22% in the fourth quarter of 2016. Income from services and fees was 467.0 million reais, up from 430.7 million reais a year ago.

For the same quarter, allowance for loan losses fell annually to 353.0 million reais, from 402.6 million reais a year earlier.

Recurring administrative expenses also fell slightly to 913.6 million reais, from 951.8 million reais a year ago. Meanwhile, other recurring operational expenses fell year on year to 156.9 million reais, from 189.2 million reais.

Return on average assets improved to 1.8% in the fourth quarter of 2017 from just 0.9% in the year-ago period. Return on average equity grew to 20.2% from 10.1%.

The quarterly results brought the bank's full-year 2017 net income to 1.05 billion reais, 59.6% higher annually from 659.7 million reais for full-year 2016.

The total credit portfolio held 31.37 billion reais in 2017, up from 30.34 billion reais in 2016. Past due loans over 90 days made up 3.56% of the total credit portfolio for the year, compared to 5.00% in the previous year.

The bank noted that it recognized in December 2017 certain IRPJ and CSLL tax credits amounting to 252.1 million reais, as monetary correction to its balance sheet arising from a legal proceeding. It also saw revenue from an agreement signed with Icatu Seguros S.A. for the establishment of a marketing firm.

As of Feb. 16, US$1 was equivalent to 3.22 Brazilian reais.