BBAS3: MEU ALERTA SINCERO PARA TODOS OS INVESTIDORES DE BANCO DO BRASIL

Summary

In this video, the host addresses the recent decline in Banco do Brasil's stock price, explaining its reasons, such as increasing delinquency rates, regulatory changes, and higher SELIC rates affecting the bank's financial performance. The video highlights the uncertainty surrounding the bank's dividends and offers insights into strategic investment decisions. Despite recent setbacks, analysts show mixed opinions on the bank's future potential, especially regarding dividends. The content also emphasizes the importance of strategic planning and how a well-structured investment approach can provide better returns over time.

Takeaways

• 😀 Banco do Brasil's stock has dropped over 20% in the past month, from R$30 to R$22, mainly due to a decline in profits.
• 😀 The decline in profit raised concerns about the future of Banco do Brasil's dividends, leading XP to remove the stock from its recommended portfolio.
• 😀 Despite the recent drop, Banco do Brasil's stock has tripled in value over the past decade, making it a long-term player in the market.
• 😀 The main factor behind the decline in profits was an increase in defaults, especially in the water sector, with the delinquency rate rising to 3.04%.
• 😀 Banco do Brasil had to increase provisions for potential defaults due to new regulations (resolution 4966), further impacting its financial margin.
• 😀 The rise in the SELIC interest rate also hurt Banco do Brasil, as it had lent money at fixed rates while paying higher rates on post-fixed liabilities.
• 😀 The stock's decline prompted debates about whether now is the time to buy or sell Banco do Brasil shares.
• 😀 Despite the setbacks, some analysts still see value in Banco do Brasil due to its high dividend yield, which is expected to remain between 7% and 11%.
• 😀 XP and Santander downgraded Banco do Brasil's rating, while Safra maintains a more optimistic outlook, expecting a potential 28% upside and a dividend yield over 11%.
• 😀 Banco do Brasil's dividend yield may decrease from its current 13.5% to around 8-11%, depending on how the bank manages its financial situation moving forward.

Q & A

Why did Banco do Brasil's stock drop by 20% in the last month?

The drop was primarily due to a significant decrease in the bank's profit, which led to concerns over its future dividends. This was attributed to an increase in defaults, particularly in the agricultural sector, and the bank’s need to reserve extra funds due to regulatory changes.

What happened to Banco do Brasil’s ROI recently?

Banco do Brasil's Return on Investment (ROI) dropped from over 21% last year to 16% in the first quarter of 2025, as its margin suffered due to increased provisions for potential defaults and other financial pressures.

How has the SELIC rate increase affected Banco do Brasil?

Although higher interest rates generally benefit banks, Banco do Brasil is facing pressure because it had previously loaned money at lower, pre-fixed rates. With the SELIC rate rising, the bank now pays more on its liabilities while earning less on past loans.

What is the main concern regarding Banco do Brasil’s dividends?

The primary concern is that, due to the recent drop in profits and increased uncertainty, Banco do Brasil may reduce its dividend payouts. Analysts expect a reduction in dividend yields for 2025, with a range of 7% to 11% compared to the previous payout of 13.5%.

Why are some analysts still recommending Banco do Brasil despite its current struggles?

Some analysts continue to recommend Banco do Brasil due to its strong dividend history and belief that the bank’s funding structure, particularly with high interest rates, will allow it to generate sufficient profit in the medium term despite the current challenges.

What was the impact of Banco do Brasil's first-quarter results on market sentiment?

The first-quarter results were disappointing, with a 20.7% drop in profit compared to the same period the previous year, leading to a negative sentiment in the market. As a result, XP downgraded its recommendation for the stock, and the stock price target was reduced.

How does the increase in defaults affect Banco do Brasil’s financial performance?

The increase in defaults, particularly in the agricultural sector, has led to higher non-performing loans (NPLs), which means the bank faces higher potential losses. This impacts its profitability and increases the need to set aside more funds as a precautionary measure.

What did the change in regulatory requirements mean for Banco do Brasil?

The regulatory change (Resolution 4966) required Banco do Brasil to set aside more funds as provisions for potential defaults, even for clients who are currently paying on time. This additional reserve, which amounted to nearly 1 billion, negatively impacted the bank’s financial margin.

What is the strategy being used to evaluate dividend-paying stocks like Banco do Brasil?

The strategy involves filtering stocks based on liquidity, payout ratios, and profitability, among other factors. The goal is to select the stocks with the highest dividend yields over the last three years, ensuring that the selected stocks are stable and offer good returns despite market fluctuations.

Should investors continue to buy Banco do Brasil despite the current challenges?

It depends on the investor's strategy. While some analysts have downgraded the stock, others still see value due to the bank’s dividend potential and its long-term stability. Investors focused on dividend income may still consider Banco do Brasil a viable option, especially with the stock offering one of the highest yields on the market.