Santander Brasil(US:BSBR)2023-10-25 15:00Financial Data and Key Metrics Changes - The company reported a total net interest income (NII) growth of 2.1% for the nine months to date, with a solid growth in asset volumes during the quarter [22][31] - The return on equity (ROE) increased by 18%, reaching BRL 2.7 billion compared to the previous quarter, with ROE rising from 11% to 13% [31][32] - The company achieved a 6.5% growth in fees during the quarter, with significant performance in various fees and commissions lines [47] Business Line Data and Key Metrics Changes - In auto financing for individuals, the company grew 2.6% quarter-on-quarter, marking the best performance since December 2020 [23] - The SME loan portfolio resumed growth with a 3.1% increase, the highest since the third quarter of the previous year [23] - The consumer finance segment showed a production increase of almost 20% in the third quarter [41] Market Data and Key Metrics Changes - Total funding increased by 16% year-on-year and 4.5% in the quarter, with a continuous improvement in the loan-to-deposit ratio [47][70] - The company reported a drop in non-performing loans (NPL) over 90 days by 30 basis points, indicating positive trends in asset quality [48][71] Company Strategy and Development Direction - The company is focusing on diversifying its portfolio and enhancing customer loyalty, aiming to become the principal bank for its customers [8][32] - A strategic shift is underway to change the funding mix from wholesale to retail, particularly in individual and corporate segments [12][35] - The company aims to double its business in the midterm, with a strong emphasis on customer satisfaction and technology integration [18][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in resuming growth in a conscious manner, focusing on quality clients and credit costs [7][19] - The company is committed to improving its customer relationship management (CRM) strategy to provide more customized offerings [32] - Management acknowledged the challenges in the low-income segment and plans to simplify offerings and improve efficiency [96][100] Other Important Information - The company is set to launch Select Global for international transactions, enhancing customer loyalty and service [11] - The company has seen a year-on-year evolution of 32% in Net Promoter Score (NPS) across all channels, indicating improved customer satisfaction [9] Q&A Session Summary Question: Portfolio quality and growth strategy - Management highlighted the positive trend in portfolio management and indicated a focus on secured businesses for growth, particularly in SMEs and large corporate [76][77] Question: Profitability concerns in the card industry - Management reassured that they are actively participating in regulatory discussions and believe that upcoming regulations will be positive for the industry [82][84] Question: Growth in Payroll and efficiency improvements - Management discussed the redesign of stores to better serve pension fund clients, leading to increased efficiency and productivity [87] Question: Strategy for low and mid-income segments - Management acknowledged the challenges in the low-income segment and emphasized the need for digitalization and simplification of offerings to improve profitability [96][100]