BTG Pactual reports all-time high net income supported by another quarter of record revenues and 22.7% ROAE

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Aug 09, 2023, 06:44 ET

Strong net new money of R$61 billion, totaling R$1.4 trillion AuM/WuM

SÃO PAULO, Aug. 9, 2023 /PRNewswire/ -- BTG Pactual (BPAC11) posted another quarter of record revenue and net income. Revenue closed Q2 at R$5.4bn, up 21% y/y, while adjusted net income was R$2.6bn, up 18% y/y. ROAE totaled 22.7%, the highest since 2015. Without the accounting impact of the Banco PAN credit portfolio acquisition, ROAE would have been 25.2%.

"We closed the quarter with record revenue and net income in a challenging macroeconomic scenario, demonstrating the resilience and diversification of our business. Net new money of R$61bn proved once again the quality of our franchises and of our network, totaling R$1.4tn in AuM/AuA. We are immensely proud of our recognition via the awards bestowed on us in Q2, which only increases our desire and efforts to generate value for clients and stockholders whilst always preserving our commitment to society", said CEO Roberto Sallouti.

BTG Pactual raised R$61bn in Net New Money (NNM), with R$35.4bn in Wealth Management and R$25.4bn in Asset Management. Total AuM/WuM were R$1.4tn, up 31% y/y.

Investment Banking posted R$306mn revenue, up 17% q/q due to better contributions from ECM and DCM. In Q2, the Bank kept its leadership in the industry rankings - ECM and M&A in Brazil and Latin America.

Corporate & SME Lending posted record revenue of R$1.3bn, up 46% y/y, with strong growth in the credit portfolio focused on top-notch counterparties at attractive spreads. The loan portfolio ended Q2 at R$153.8bn, up 31% y/y.

Sales & Trading posted outstanding results due to higher client activity and efficient risk allocation, with record revenue of R$1.9bn, up 44% y/y, and 27% q/q.

In Asset Management, AuM/ AuA were R$768bn, up 27% y/y, with net new money (NNM) of R$25.4bn and R$431mn revenue. NNM in 1H23 was R$38bn, while the AM industry recorded outflows of R$205bn.

Wealth Management & Consumer Banking reported record revenue for the 18th consecutive quarter of R$727mn, up 17% y/y. Wealth under Management (WuM) was R$630bn, up 36% y/y. Despite challenging macroeconomic scenario, WM reported strong NNM of R$35.4bn, proving the quality of our network and its distribution capacity.

The BIS ratio remains stable and ended the quarter at 15.4%, while the liquidity coverage ratio (LCR) was 157%.

Strategic partnerships

In Q2, BTG announced the acquisition of a minority stake in Systemica, a Brazilian company that structures, develops and sells carbon projects and other environmental assets, aimed at contributing to a transition economy whilst joining forces to boost the carbon market. The Bank also structured and distributed US$1.1bn in green and sustainable bonds.

In July, the Bank signed a JV with Senior Sistemas, whereby BTG Empresas will offer financial services and products to companies directly from Senior Sistemas' ERP, which will contribute with its expertise in management systems while BTG will add its expertise in developing digital financial products, risk management, and funding. The transition is subject to the usual precedent conditions, such as CADE and Brazilian Central Bank approvals.

Awards

For the third consecutive year, BTG Pactual was voted the best team in Research Latin America; Corporate Access Latin America, Trading Latin America, Sales Latin America, Research Brazil, and Sales Brazil by Institutional Investor. The Research team won awards in all categories, ranking 1st in 18 of 25 categories.

In the area of ESG and Impactful Investment, the Bank was also voted:

Global Finance – The Innovators Awards 2023: Top Financial Innovations: Sustainability/ESG" – for being lead coordinator of the first blue bond issuance in Brazil in Nov/22
Global Finance – "The Sustainable Finance Awards" – "Outstanding Leadership in Sustainable Finance, in Sustainable Bonds and in Sustainability Transparency in LatAm" ; "Outstanding Sustainable Financing in Emerging Markets" and "Sustainable Finance Leadership in Brazil"
Institutional Investor – Best ESG Research Team in Latin America and in Brazil
World Finance Banking Awards – Brazil´s Most Sustainable Bank

1H23 results

BTG Pactual ended 1H23 with revenue of R$10.2bn, up 16% y/y. Adjusted net income grew 14% to R$4.8bn. These are both record results, with strong growth mainly in client franchises. Total assets under custody (AuC) hit R$1.4tn, up 31% y/y. Net New Money (NNM) came in at R$104bn and ROAE was 21.7% (vs. 21.5% in 1H22).