By Brazil Stock Guide — Itaú Unibanco (B3: ITUB4; NYSE: ITUB), Brazil’s largest private-sector bank, reported recurring managerial net income of R$12.617 billion in the third quarter of 2026, up 6.2% from a year earlier and 1.7% from the previous quarter.
Earnings were supported by loan growth, higher net interest income and disciplined operating expenses. Reported net income under Brazilian accounting standards totaled R$12.164 billion.
Itaú’s expanded loan portfolio, including financial guarantees and private debt securities, reached R$1.544 trillion at the end of September, an increase of 10.2% year over year and 1.4% from June. In Brazil, lending grew 10.9% over 12 months, led by payroll-deductible loans, which rose 16.3%, mortgages, up 15.8%, and lending to micro, small and medium-sized enterprises, which expanded 15.1%. The growth reflects the bank’s emphasis on lending products backed by collateral or more predictable repayment mechanisms.
Managerial net interest income rose 7.8% year over year to R$34.611 billion. Net interest income from customer operations increased 6.6% to R$33.286 billion, while income from market-related activities climbed 46.9% to R$1.325 billion.
Fee and commission income was virtually unchanged at R$11.048 billion, while revenue from insurance, pension and capitalization products rose 2% to R$3.494 billion, before claims expenses.
Asset quality showed modest signs of deterioration. The consolidated ratio of loans more than 90 days past due increased to 2%, from 1.9% in the previous quarter, while the cost of credit rose 10.2% year over year to R$10.415 billion.
According to the bank, part of the increase in delinquencies reflected the normalization of overdue loans among micro, small and medium-sized businesses following the expiration of grace periods under government-backed lending programs. Despite the increase in absolute credit costs, the annualized cost-of-credit ratio remained stable at 2.7% of the average loan portfolio.
Non-interest expenses totaled R$17.129 billion, up 1.7% from a year earlier, well below the 5.5% increase in the bank’s managerial operating revenue, which reached R$49.152 billion. Itaú’s efficiency ratio improved to 37.5%, from 38.8% a year earlier, indicating that operating expenses absorbed a smaller share of revenue.
Recurring return on average equity (ROE) stood at 23.6%, compared with 23.3% in the third quarter of 2025, although it declined from 24.3% in the preceding quarter. The figure underscores Itaú’s ability to sustain profitability above 20% even as credit costs increase.
For full-year 2026, Itaú maintained its guidance for loan portfolio growth of 5.5% to 9.5% and total credit costs of R$38.5 billion to R$43.5 billion. The main revision concerned taxation: the bank lowered its expected effective income tax and social contribution rate to a range of 28% to 29%, from 29.5% to 32.5%, potentially providing additional support to earnings in the final quarter of the year.
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