By Jeffrey T. Lewis
SÃO PAULO--Banco Bradesco SA's net income rose in the first quarter from a year earlier as the lender set aside less money as provisions for bad loans.
Bradesco said book net income rose 81.9% in the three months through March from a year earlier to 6.2 billion Brazilian reais, equivalent to $1.1 billion. Recurring net income, which leaves out one-time items, rose 73.6% to 6.5 billion reais, the bank said Tuesday. Operating income increased 81% to 9.8 billion reais.
Bradesco and its peers in Brazil put aside billions of reais in provisions last year to prepare for a possible increase in bad loans due to the jump in unemployment and the shutting down of businesses arising from the coronavirus pandemic.
So far bad loan levels haven't risen sharply, partly because of debt renegotiations and the postponement of payments due to the pandemic. Bradesco reported a delinquency ratio of 2.5% in the first quarter, down from 3.7% in the first quarter of last year but up from 2.2% in the fourth quarter, and provisioned 3.9 billion reais for bad loans in the first quarter, down from the 6.7 billion reais it set aside in the same quarter a year earlier.
Bradesco and other Brazilian banks have been working to cut costs by closing branches and reducing staff. Bradesco said its operating costs fell 4.7% in the first quarter from a year earlier to 11.2 billion reais.
Write to Jeffrey T. Lewis at firstname.lastname@example.org
(END) Dow Jones Newswires