Brazilian Bank Profit Plummets 66.5%

The profit of the Bank of Brazil showed a decrease of 66.5% in the third quarter of 2026, compared to the same period of the previous year. The financial institution recorded an adjusted net income of R$ 1.27 billion, a result mainly impacted by the advance of default in credit operations, with emphasis on the agribusiness sector.

Given the scenario of increased arrears and loan-related expenses, the bank revised its projections for the remainder of the year. The annual profit estimate was halved, while the forecast for credit losses was significantly increased.

According to the institution, the deterioration of the indicators is related especially to the difficulties faced by rural producers and companies of certain economic segments.

"The increase mainly reflects the continuation of the rise in defaults in part of the agribusiness portfolio and point reinforcements in companies in the attacked segment," the bank said.

The failure of agribusiness pressures result

The increase in default was one of the main factors responsible for the reduction in the profitability of the Bank of Brazil.

During the third quarter, the cost of credit reached R$ 21.2 billion, representing growth of 18.4% compared to the same period in 2025.

This indicator considers the resources reserved to cover possible losses on unpaid loans, in addition to discounts granted on renegotiations and amounts recovered from previous debts.

In agribusiness, payment problems mainly affected medium and large producers linked to soybean and corn crops, in addition to livestock. The highest concentration of cases was identified in the Midwest region.

The overall default index, which considers operations with delays of more than 90 days, reached 6.08% in September 2026. In the same month of 2025, the percentage was 4.51%.

Among the segments analyzed, the indicators were:

Agribusiness: 6.92%, compared to 4.84% in September 2025;

Individual: 9.14%, compared to 6.01% registered a year earlier;

Legal entity: 3.44%.

Despite the advance of the delays, the expanded credit portfolio of the Banco do Brasil closed September at R$ 1.3 trillion. The volume represents growth of 2.2% in 12 months, but decrease of 0.5% compared to the previous quarter.

Banco do Brasil reduces profit forecast for 2026

With performance below expectations, the financial institution has decided to revise its main estimates for 2026.

The projection of adjusted net profit, previously situated between R$ 18 billion and R$ 22 billion, passed to a range of R$ 9 billion to R$ 11 billion.

At the same time, the forecast of the cost of credit has increased considerably. The previous estimate, from R$ 65 billion to R$ 70 billion, was replaced by a range between R$ 80 billion and R$ 83 billion.

The bank has also changed expectations for its credit portfolio. Before, the institution expected growth between 0.5% and 4.5%. Now, it works with a scenario that varies between stability and retraction of up to 2%.

Another indicator affected was the gross financial margin, which corresponds to the difference between the revenues obtained with interest and the costs of raising resources.

In the third quarter, this result stood at R$ 26 billion, a 1.5% decrease in the annual comparison.

Dividends will be reduced in 2026

The financial performance also triggered changes in shareholder remuneration policy.

The Bank of Brazil said it will allocate 25% of the profit to the distribution of dividends in 2026, a percentage corresponding to the mandatory minimum.

Interest on equity (JCP) for the third quarter totaled R$ 197 million, equivalent to approximately R$ 0.04 per share.

The amount represents a reduction of about 52% compared to the same period last year.

The company also announced changes to the schedule of payments to investors.

There will be no new interim income announcements on November 11 and 19, 2026. The supplement for this year’s fiscal year is expected to be announced on February 17, 2027, with payment scheduled for March 10.

By 2027, the bank said it does not intend to make any intermediate returns or distributions of dividends. The payment of the mandatory minimum will depend on the capital projections of the institution.

The Basel Index also shows a fall

In addition to the reduction in profit, other financial indicators pointed to a decrease in the ability of Banco do Brasil to generate results.

The Basel index, used to assess a financial institution’s ability to absorb losses and face risks, closed September at 13.45 percent.

The percentage was below the 14.81% recorded in the same period of 2025.

The main capital index, composed of the resources considered of the highest quality to bear any losses, fell from 11.16% to 10.80%.

The profitability on equity (ROE), an indicator that measures the return provided to shareholders, also showed an expressive contraction.

The percentage increased from 8.4% to 2.8% in the annual comparison.

The results reinforce the challenges faced by the Bank of Brazil in the face of increased defaults, pressure on credit operations and the need to preserve the financial capacity of the institution. (The information is from Agência Brasil)

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