By Jeffrey T. Lewis
SAO PAULO--Brazilian lender Itau Unibanco Holding SA reported that its profit increased in the second quarter from a year earlier after the bank set aside less for provisions for bad loans.
The company's net income more than doubled to 7.6 billion reais, the equivalent of $1.5 billion, from 3.4 billion reais a year earlier, while its recurring managerial result rose 55.6% to 6.5 billion reais, Itau said Monday. Operating revenue increased 9.3% to 30.6 billion reais.
The bank said it reduced its allowance for loan losses by 39.6% to 4.7 billion reais in the second quarter of this year from the same period a year earlier.
Itau and its Brazilian rivals began to set aside large provisions starting in the first quarter of last year to prepare for an expected increase in bad loans due to the coronavirus pandemic, which shut down many businesses for weeks or months and cost millions their jobs.
As the country's vaccine programs advance, and social distancing measures are eased, Brazil's economy is showing signs of recovery and Itau's default rate declined in the second quarter from a year earlier to 2.3% from 2.7%.
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(END) Dow Jones Newswires
August 02, 2021 18:37 ET (22:37 GMT)Copyright (c) 2021 Dow Jones & Company, Inc.