SAO PAULO, Feb 5 (Reuters) - Brazil's largest private lender, Itau Unibanco, on Monday said it expects to accelerate lending this year, while net interest income growth should slow down amid a backdrop of falling interest rates.
The lender expects its credit portfolio to grow by between 6.5% and 9.5% in 2024, picking up from the 3.1% yearly growth it reported in 2023. Its loan book ended the fourth quarter with 1.18 trillion reais ($236.69 billion).
Brazil's central bank cut its benchmark interest rate for the fifth time in a row last week, after keeping it at a 6-year high for nearly a year, signaling that there are more cuts to come.
Net interest income from clients, a measure of loans minus deposit costs, should grow between 4.5% and 7.5% in 2024, slowing down from the 12.5% growth of 2023.
Its cost of credit, mainly comprised of provisions for loans likely to default, should total between 33.5 billion reais and 36.5 billion reais.
In the fourth quarter, the bank had to set aside nearly 9.3 billion reais for bad loans, just slightly above the previous quarter.
Delinquency, measured by its 90-day loan-default ratio, improved by 0.2 percentage points from the previous quarter, landing at 2.8%.
Itau reported a 22.6% increase in fourth-quarter recurring net profit compared with the previous year to 9.40 billion reais. Analysts polled by LSEG had expected 9.38 billion reais.
Return on equity, a gauge of profitability, grew slightly to 21.2% compared with the previous three months.
($1 = 4.9854 reais) (Reporting by Peter Frontini; Editing by Anthony Esposito and Stephen Coates)
