Inter & Co(INTR) - 2022 Q2 - Quarterly Report

Financial Performance - The total revenue for the six-month period ended June 30, 2022, reached R$2,574.8 million, an increase of R$1,450.0 million compared to the same period in 2021, with a notable profit on securities growing by 287.7% to R$754.9 million[17]. - The company recorded a negative net income of R$13.3 million for the six-month period, an improvement from a negative net income of R$33.2 million in the same period of 2021[15]. - The company achieved revenues of R$2,638,601 for the six-month period ended June 30, 2022, compared to R$1,226,356 for the same period in 2021, reflecting a growth of approximately 115.5$334,777 for the six-month period ended June 30, 2022, compared to a loss of R$212,195 in the same period of 2021, indicating a deterioration in performance[73]. Assets and Liabilities - Total assets reached R$40.9 billion, representing an 11.7% growth compared to December 2021[19]. - Total liabilities rose to BRL 33,818,398 as of June 30, 2022, compared to BRL 28,176,554 at the end of 2021, marking a 20% increase[33]. - Cash and cash equivalents increased to BRL 1,549,158 as of June 30, 2022, compared to BRL 500,446 at the end of 2021, reflecting improved liquidity[33]. - The loan portfolio balance reached R$19.5 billion, reflecting a positive change of 13.4$5.4 billion, a growth of 9.8%[13]. Shareholder Equity - Shareholders' equity totaled R$7.1 billion, showing a reduction of 18.4$1,161.3 million, an increase of R$724.7 million from the same period in 2021, attributed to the expansion of services and client base growth[18]. Corporate Actions - The company completed the acquisition of 100$758,979, which includes R$631,901 in cash and R$37,644 in capital increase[76]. Financial Services Expansion - The acquisition of USEND allows Inter to expand its financial services in the U.S. market, integrating its solutions with the existing platform and targeting both U.S. residents and Brazilian customers[76]. - The company aims to operate as a multi-service digital bank, offering services such as real estate credit, payroll loans, corporate credit, and insurance[54]. Accounting and Financial Reporting - The company’s financial statements are prepared in accordance with IAS 34, with all amounts presented in thousands of Brazilian reais (BRL)[55]. - The new accounting standards effective from January 1, 2022, did not have a significant impact on the Group's financial statements[62]. - The Group recognizes revenue using a five-step model, with significant revenues derived from interchange fees and asset management activities[180]. Acquisitions and Goodwill - The fair value of identifiable assets acquired from USEND was R$236,087, with total liabilities of R$156,642, resulting in net identifiable assets of R$79,445 and goodwill of R$679,534[79]. - Goodwill from acquisitions represents the excess of transferred consideration over the fair value of identifiable net assets acquired, and is not amortized[151]. Risk Management - The expected credit loss is assessed using probability of default (PD), loss given default (LGD), and exposure at default (EAD) metrics[122]. - The Group recognizes expected credit losses on financial assets measured at amortized cost or fair value through other comprehensive income[119].