Santander Brasil Net Profit Up 10.3% in 3rd Quarter -- Update

By Rogerio Jelmayer

SAO PAULO--The Brazilian unit of Spain's Banco Santander SA (SAN.MC) posted a net profit gain of 10.3% in the third quarter, as the bank's increased financial-services revenue offset a rise in provision charges.

Banco Santander Brasil SA (SANB11.BR) on Wednesday said net profit totaled 1.88 billion reais ($607 million), up from BRL1.7 billion in the year-ago period.

Financial-services revenue, including tariffs, increased nearly 18% to BRL3.4 billion.

The bank's provisions to cover bad loans rose nearly 16% to BRL2.8 billion in the period. The increase came as Brazil's economic recession persisted and economists expected the country's labor market to deteriorate further.

After contracting 3.8% last year, Brazil's economy is expected to shrink 3.2% this year, according to economists.

Brazilians have showed little appetite for new loans during the downturn. Santander's loan portfolio dropped 6.3% to BRL310 billion at the end of the third quarter from the year-ago period.

The lender's nonperforming loan rate, covering loans that were more than 90 days overdue, ended the third quarter at 3.5%, up from 3.2% in the third quarter of 2015.

Write to Rogerio Jelmayer at [e-mail]

(END) Dow Jones Newswires

October 26, 2016 06:24 ET (10:24 GMT)

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