Key Highlights

  • Earnings per share of 0.0717 trailed the consensus estimate of 0.1764, with recurring net income near BRL 2.9 billion.
  • Revenue of 3.79 billion fell short of the consensus estimate of 4.23 billion, while client net interest income declined.
  • Return on equity was 11.9% and the efficiency ratio stood at 38.8%, with expenses growing well below inflation.
  • Mortgage loans grew 10.3% and transactional deposits 10% over twelve months, while the client base reached 76.9 million.

Santander Brasil (NYSE:BSBR) reported third quarter 2026 earnings per share of 0.0717, well below the consensus estimate of 0.1764, and revenue of 3.79 billion against a consensus estimate of 4.23 billion. The company figures below are in Brazilian reais. Recurring net income was close to BRL 2.9 billion with a return on equity of 11.9%, which Chief Executive Officer Gilson Finkelsztain described as still below the profitability levels the bank is aiming for.

The quarter was the first of a new management cycle under Finkelsztain. He pointed to high interest rates and rising household debt as pressures on revenue and cost of risk, and to one-off cases in the wholesale segment. The bank ended the quarter with 76.9 million clients, up 6% over twelve months.

Net Interest Income and Credit Mix

Client net interest income declined in the quarter, which the chief financial officer attributed to four factors: lower funding income from a lower average CDI rate, a larger impact from the deferral of banking correspondent expenses, the sale of a consumer finance portfolio, and selective loan origination. These effects more than offset extra days in the quarter. Management also said a shift toward companies and high net worth clients, which carry structurally lower spreads, adds downward pressure on the metric. Management put the quarterly spread drop at 33 basis points, mostly from the consumer finance receivables fund effect.

Over twelve months, mortgage loans rose 10.3%, loans to small and medium enterprises rose 8.5% and consumer finance rose 9.1% even after the portfolio sale. The share of hybrid and electric vehicles in financed vehicles climbed from 5% to 20%. The Santander Rewards platform has reached about 700,000 clients, whose spending rose more than 10% relative to other clients.

Asset Quality, Costs and 2027 Comments

Specific wholesale cases totaled approximately BRL 500 million, and excluding one-off effects in the last two quarters, provisions were described as stable. Management cited continued pressure in agribusiness, among low income individuals and more recently middle income cardholders, and said a stricter stance on renegotiations, including added collateral or upfront cash, may weigh on asset quality indicators while improving the quality of renegotiated loans. Short term delinquency improved for a second consecutive quarter.

Expenses grew well below inflation despite a 4.6% collective bargaining agreement, and the bank cut its product lineup by more than 100 items in 2026. For 2027, the chief financial officer said the outlook is more positive, with market net interest income still negative but better than in 2026, and Finkelsztain said the bank is reducing its sensitivity to interest rates through hedging.

Data Points Behind the Next Report

Several items can be tracked. Recurring net income of close to BRL 2.9 billion and the 11.9% return on equity are the reference for the recovery the bank describes as gradual. The wholesale one-offs of approximately BRL 500 million bear on whether provisions stay stable in the fourth quarter, a point management said it could not guarantee. The 38.8% efficiency ratio, over 90 day delinquency in individuals and agribusiness, and the pace of SME lending, which grew 8.5%, round out the watch list.