Itaú Unibanco (ITUB) Q2 2025 Earnings Call August 06, 2025 09:00 AM ET Company ParticipantsGustavo Rodrigues - IR Director & Investor Relations OfficerMilton Maluhy Filho - President & CEOTito Labarta - Vice PresidentGabriel Amado de Moura - CFO & Member of Executive CommitteeNicolas Riva - DirectorCarlos Gomez-Lopez - Head - LatAm Financial InstitutionsGustavo RodriguesHello. Good morning everyone. My name is Gustavo and it's a pleasure to have you with us for our 2025 earnings video conference. As always ...

Financial Data and Key Metrics Changes - The company reported a net income of R11.5 billion, representing a 3.4% increase quarter over quarter and a 14.3% increase year over year [5] - The consolidated Return on Equity (ROE) reached 23.3%, expanding both quarter over quarter and year over year, with Brazil's ROE at 24.4% [6] - Net Interest Income (NII) with clients increased by 3.1% over the previous quarter and 15.4% year over year, while the Net Interest Margin (NIM) expanded to 9.2% on a consolidated basis [7][20] Business Line Data and Key Metrics Changes - The individual loan book grew by 8.0% year over year and 0.7% in the quarter, with credit card loans increasing by 1.6% quarterly [9] - The mortgage loan book grew by 2.1% in the quarter and 17.2% year over year, while the SME loan portfolio grew by 0.8% in the quarter [13] - The finance credit card portfolio grew by 5.4% in the quarter and 6.1% year over year, with 100% of annual growth coming from the Uniclass and Personality segments [15] Market Data and Key Metrics Changes - The total credit portfolio grew by 0.4% in the quarter, and excluding foreign exchange impacts, it would have grown by 1.3% [14] - The loan book in Brazil grew by 1%, while in Latin America, the portfolio declined by 2.3% due to the appreciation of the Brazilian real against other currencies [13] Company Strategy and Development Direction - The company is focused on digital acceleration and the One Itau initiative, with over 10 million clients migrated to the platform and a Net Promoter Score (NPS) of 80 points [44] - The strategy emphasizes a holistic view of client relationships rather than merely increasing market share, focusing on delivering value through personalized offerings [60] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the bank's ability to generate capital organically and maintain strong credit quality despite potential increases in non-performing loans (NPL) [32] - The company reaffirmed its guidance for credit portfolio growth and updated expectations for NII with clients' growth to between 11% and 14% [41][42] Other Important Information - The company reported an 8.7% increase in non-interest expenses in Brazil compared to the previous year, with personnel and transactional expenses well controlled [37] - The efficiency ratio improved to 36.4% in Brazil for the first half of 2025, down from 37% in 2024, indicating better operational efficiency [39] Q&A Session Summary Question: Discussion on market share and strategy - Management emphasized that market share is a consequence of focusing on the right clients and providing a holistic view of relationships rather than a primary objective [60] Question: Initiatives for finance credit portfolio growth - Management highlighted the importance of product offerings and client journey improvements, noting that the finance credit card portfolio is expanding due to personalized offerings [66] Question: Extraordinary expenses and efficiency targets - Management clarified that the extraordinary expenses were non-recurring and part of a broader strategy to improve efficiency and digital transformation [75] Question: Stabilization of checking account revenue - Management acknowledged the decline in checking account revenue but emphasized strong transactionality in retail and the need to re-signify service packages [86] Question: Profitability of wholesale vs retail segments - Management noted that retail profitability is improving due to better credit management and digital initiatives, while wholesale profitability remains strong [99]