July 25, 2019 / 9:59 AM / 2 months ago

UPDATE 1-Brazil's Banco Bradesco tops Q2 recurring profit estimates

(Adds details on Q2 results and share performance so far in 2019)

By Gabriela Mello

SAO PAULO, July 25 (Reuters) - Brazil’s Banco Bradesco SA beat analysts’ second-quarter profit estimates on Thursday, helped by strength in consumer lending and fees, as well as a decline in loan loss provisions.

Recurring net income, which excludes one-off items, totaled 6.462 billion reais ($1.71 billion) at the country’s second largest private sector lender, and surpassed the 6.059 billion reais expected by analysts, Refinitiv Eikon data.

The bank’s profitability, measured by its return on equity, rose to 20.6% from 20.5% in the first quarter and 18.4% a year ago.

Bradesco’s loan book grew in the second quarter at a faster pace, expanding 8.7% year-on-year due largely to consumer loans, compared to a 3.1% rise in the prior quarter.

Chief Executive Octavio de Lazari had suggested asset quality would improve in the second quarter, as the bank works to lift clients’ credit limits using new tools to estimate income from sources like freelance jobs and rental properties.

Bradesco’s second-quarter loan loss provisions fell by 0.1% from a year earlier to 3.487 billion reais. Its 90-day delinquency rate came at 3.2% in the quarter, 0.1 percentage point below the first quarter.

Bradesco preferred shares have risen more than 20% so far this year, outpacing rival Itaú Unibanco, which have climbed less than 11% since the beginning of 2019.

$1 = 3.7726 reais Reporting by Gabriela Mello; Editing by Jason Neely and Edmund Blair

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