Itaú Unibanco's Q1 2025: Navigating Market Share, Economic Growth, and Credit Risk Contradictions

Market share and competition, economic growth and strategic focus, market share and competitive position, credit risk management and strategy are the key contradictions discussed in Itaú Unibanco Holdings' latest 2025Q1 earnings call.



Stronger Financial Performance:
- Itaú Unibanco reported a recurring managerial result of R$11.1 billion for Q1 2025, representing a 2.2% increase quarter-on-quarter and 14% year-over-year.
- This growth is attributed to a significant improvement in ROE, which reached 22.5% on a consolidated basis, driven by strategic business management and an increase in NII with clients.

Credit Portfolio and Risk Management:
- The credit portfolio grew by 8.6%, with notable increases in the individual and SME loan portfolios.
- This expansion is mainly due to strong growth in credit cards, personal loans, and residential finance, while payroll loans for INSS beneficiaries were impacted by interest rate caps.

Efficiency and Cost Management:
- Itaú Unibanco achieved a consolidated efficiency ratio of 38.1%, a significant reduction from the previous quarter and a clear year-over-year improvement.
- This improvement is a result of rigorous cost management, including reducing interest expenses and optimizing technology investments, leading to enhanced operational leverage.

Digital Transformation and Product Innovation:
- The bank has migrated 8 million clients to the One Itaú platform, with a net promoter score (NPS) of 85.
- This digital transformation has enhanced client engagement and service offerings, contributing to increased product penetration and digital banking adoption.