Inter & Co(US:INTR)2024-04-30 21:26Financial Performance - Gross Loan Portfolio increased to R$31,020,837 thousand in 2023, up from R$24,543,993 thousand in 2022, representing a growth of 26.5%[25] - SG&A expenses totaled R$2,412,527 thousand in 2023, slightly up from R$2,392,061 thousand in 2022, indicating a marginal increase of 0.8%[26] - Efficiency Ratio improved to 54.5% in 2023 from 72.2% in 2022, reflecting enhanced operational efficiency[28] - Return On Average Equity (ROAE) was 4.8% in 2023, a significant recovery from a loss of (0.2)% in 2022[29] - Net Fee Revenue rose to R$1,544,488 thousand in 2023, up from R$1,227,268 thousand in 2022, marking an increase of 26%[33] - Total Gross Revenue reached R$8,079,000 thousand in 2023, compared to R$5,986,000 thousand in 2022, reflecting a growth of 35%[40] Risk Management - Cost of Risk increased to 5.5% in 2023 from 5.2% in 2022, indicating a rise in credit risk[31] - Liquidity risk management structure is designed to monitor and prevent breaches of liquidity ratio limits[744] - Market risk includes potential losses from fluctuations in stock prices, interest rates, exchange rates, and commodity prices[745] - Operational risk arises from failures in internal processes, people, systems, or external events, with processes in place to mitigate these risks[746] Funding and Costs - Funding increased to R$43,513,032 thousand in 2023 from R$32,516,818 thousand in 2022, a growth of 33.7%[36] - Cost of Funding rose to 7.6% in 2023 from 7.1% in 2022, indicating higher interest expenses relative to funding[38] Interest Income and Portfolio Growth - As of December 31, 2023, the net interest income and income from securities and derivatives increased to R$3,208,088 thousand, up from R$2,335,429 thousand in 2022, representing a growth of approximately 37.3%[46] - The net interest margin (NIM) improved to 7.4% in 2023, compared to 6.7% in 2022, indicating enhanced efficiency in generating interest income[46] - The average interest-earning portfolio rose to R$43,289,368 thousand in 2023, up from R$34,759,632 thousand in 2022, reflecting a growth of about 24.5%[46] - The NIM excluding the credit card transactor portfolio increased to 8.7% in 2023 from 7.8% in 2022, highlighting the company's ability to generate interest income from its asset portfolio[50] Loan and Securities Growth - The total loans and advances to customers, net of provisions for expected loss, reached R$27,900,543 thousand in 2023, compared to R$21,379,916 thousand in 2022, marking an increase of approximately 30.5%[43] - The amount due from financial institutions, net of provisions for expected loss, decreased to R$3,718,506 thousand in 2023 from R$4,258,856 thousand in 2022, a decline of about 12.7%[43] - The securities held by the company increased significantly to R$16,868,112 thousand in 2023, up from R$12,448,565 thousand in 2022, representing a growth of approximately 35.5%[43] - The credit card transactor portfolio also grew, reaching R$7,490,011 thousand in 2023, compared to R$5,411,798 thousand in 2022, an increase of about 38.5%[50] Strategic Initiatives - The company continues to focus on expanding its market presence, particularly through the acquisition of Inter&Co Payments in the United States, aiming to integrate operations and enhance growth opportunities[58] - The company emphasizes the importance of client acquisition cost (CAC) as a metric to monitor the efficiency of its growth strategies, reflecting its commitment to optimizing operational expenses[55]