Brazil Stock Guide – Itaú Unibanco Holding S.A. (B3: ITUB4; NYSE: ITUB) reported a recurring net income of R$11.9 billion ($2.1 billion) for the third quarter of 2025, up 11.3% from a year earlier and 3.2% higher than in the previous quarter, keeping its return on equity (ROE) steady at 23.3%. The result reflects expanding credit volumes, rising client margins, and disciplined cost control, confirming the bank’s leadership as Latin America’s most profitable financial institution.
The managerial financial margin reached R$31.4 billion, a 10.1% year-on-year increase, driven by loan growth and stronger client spreads. The margin with clients advanced 11%, supported by higher profitability on funding and capital. The total credit portfolio stood at R$1.4 trillion, growing 0.9% from June and 6.4% over 12 months, with balanced performance across segments. In Brazil, the portfolio expanded 7.8%, fueled by mortgages (+15.2%), credit cards (+6.7%), and SME lending (+7.5%), while the Latin America book remained stable in nominal terms and increased 4.5% in constant currency.
Asset quality continued to show resilience, with the nonperforming loan ratio above 90 days holding at 1.9%, unchanged from the prior quarter and near historical lows. The cost of credit totaled R$9.1 billion, up just 0.6% sequentially and 10.9% year on year. Itaú noted a small uptick in short-term delinquencies linked to a single large corporate client that was already fully provisioned, with no systemic impact on asset risk.
Service and insurance revenues rose 7.1% year on year, supported by card issuance, payment services, and a 17.8% jump in insurance income on stronger premium growth. Non-interest expenses increased 7.6% from a year earlier to R$17.2 billion, reflecting technology investments and higher wage costs from Brazil’s collective bargaining agreement signed in September. Even so, the bank reached an efficiency ratio of 38.8% at the group level, and a record 37.7% in Brazil, the best third-quarter result in its history — a milestone that highlights productivity gains from digitalization and scale.
Capital remained robust. The CET1 ratio improved to 13.5%, up 0.4 percentage points from June, while the total Basel ratio stood at 16.4%. The bank’s assets reached R$3 trillion, an increase of 3.4% quarter on quarter, and market capitalization climbed to R$397 billion ($74.7 billion), up 20% year on year. Itaú also revised upward its 2025 guidance for market financial margin, now expecting a contribution between R$3.0 billion and R$3.5 billion, compared with the previous range of R$1.0–3.0 billion, citing stronger trading performance than initially projected.
For the first nine months of 2025, net income totaled R$33.7 billion, up 13.7% year on year, with an average ROE of 22.9%. The banking product, which combines net interest income, service fees, and insurance revenue, grew 9.6% to R$136.8 billion, while insurance and pension operations advanced 14.7%, reflecting solid demand for protection and wealth products.
CEO Milton Maluhy Filho said Itaú is “entering a phase of accelerated transformation, guided by solid governance, innovation, and proximity to our clients.” He noted that the bank’s focus on AI-driven personalization and digital ecosystems is allowing Itaú to deliver “financial experiences tailored to every customer segment.” CFO Gabriel Amado de Moura added that the quarter’s results “reinforce Itaú’s financial strength and ability to grow with discipline and efficiency,” citing record low delinquency, continued digital expansion via the SuperApp, and sustained capital generation.
The bank reaffirmed its full-year guidance, projecting client margin growth between 11% and 14%, credit costs between R$34.5 billion and R$38.5 billion, and operating expense growth between 5.5% and 8.5%. Management said these targets reflect confidence in maintaining profitability as Itaú deepens its technology investments and strengthens its universal banking model across Latin America.
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