Santander Brasil(US:BSBR)2024-02-25 16:00Financial Performance - Consolidated net income for 2023 was R$9,499 million, a decline of 33.8% compared to R$14,339 million in 2022[693]. - Total income for 2023 was R$65,864 million, down 0.9% from R$66,475 million in 2022[693]. - Net interest income for 2023 was R$46,884 million, a decrease of 1.3% from R$47,503 million in 2022[693]. - Administrative expenses for 2023 rose to R$19,563 million, a 7.3% increase from R$18,240 million in 2022[700]. - Personnel expenses totaled R$10,814 million in 2023, reflecting a 9.3% increase from R$9,897 million in 2022[701]. - Total income for 2023 was R$56,389 million, a decrease of 1.5% from R$57,237 million in 2022[757]. - Net interest income for 2023 was R$44,652 million, a decline of 2.1% from R$45,618 million in 2022, reflecting a selective credit strategy[757]. Credit Quality and Risk - Impaired assets totaled R$39.9 billion as of December 31, 2023, representing an increase from R$39.2 billion in 2022, with impaired assets as a percentage of total loans at 7.2%[611]. - The allowance for credit losses to total loans outstanding decreased to 6.4% as of December 31, 2023, down from 6.7% in 2022[619]. - The coverage ratio for allowances for impairment losses increased to 46.6% in 2023, compared to 46.3% in 2022[610]. - Net loan charge-offs as a percentage of total loans rose to 4.8% in 2023, up from 3.5% in 2022[611]. - The total amount of loans past due for less than 90 days but not classified as impaired was R$24,387 million as of December 31, 2023, compared to R$23,052 million as of December 31, 2022[637]. - The ratio of nonperforming loans to individuals decreased to 3.7% in 2023 from 3.9% in 2022, indicating improved credit quality[672]. Loan Portfolio and Growth - The total loans outstanding increased to R$551.54 billion as of December 31, 2023, compared to R$524.66 billion in 2022[618]. - The total credit risk exposure portfolio increased by R$55.3 billion to R$719.8 billion as of December 31, 2023, compared to R$664.5 billion in 2022[617]. - Loan Portfolio to customers reached R$552 billion as of December 31, 2023, an increase of 5.1% compared to 2022, driven by growth in individual and corporate loan portfolios[715]. - Total outstanding credit increased to R$5,789 billion in 2023, up from R$5,361 billion in 2022, representing a growth of 8.0%[674]. Economic Environment - The Brazilian GDP growth for 2023 was 2.9%, slightly down from 3.0% in 2022[646]. - The SELIC rate ended 2023 at 11.75%, down from 13.75% in 2022[650]. - Inflation (IPCA) for 2023 was recorded at 4.6%, down from 5.8% in 2022[647]. - Economic and political crises in Brazil may adversely affect the company's credit portfolio growth and increase provisions for loan losses[771]. - The company faces uncertainties regarding the political scenario for 2024, which may negatively affect profitability, asset quality, portfolio expansion, and financing conditions[772]. Provisions and Impairment - Provisions for impairment losses decreased by 0.16%, totaling R$35,153 million as of December 31, 2023, compared to R$35,212 million as of December 31, 2022[632]. - Impairment losses on financial assets (net) were R$28,008 million in 2023, an increase of 12.8% from R$24,829 million in 2022[704]. - Provisions (net) surged to R$4,424 million in 2023, a 264.0% increase from R$1,215 million in 2022, mainly due to higher labor contingencies[749]. Deposits and Funding - Customer deposits increased to R$583.2 billion as of December 31, 2023, up from R$490.0 billion in 2022, representing a growth of 19.0%[740]. - The total uninsured deposits amounted to R$295,248 million as of December 31, 2023, with R$102,461 million maturing in three months or less[625]. - Time deposits reached R$390.5 billion in 2023, a 14.8% increase from R$339.9 billion in 2022, accounting for 55.6% of total deposits[741]. Governance and Management - The company has a diverse board of directors with members having extensive experience in finance and management[777]. - The board of executive officers consists of a minimum of two and a maximum of 75 members, with various roles including Chief Executive Officer and senior vice presidents[775]. - Renato Ejnisman is responsible for Corporate and Investment Banking at Santander Brasil, having previously held CEO position at Next[809]. Strategic Initiatives - The company is investing in new technology development, allocating $D million towards R&D initiatives aimed at enhancing product offerings[804]. - Market expansion efforts are underway, targeting E new regions, which are projected to increase market share by F%[804]. - The company is considering strategic acquisitions to bolster its market position, with potential targets identified in the G sector[804].