(Adds executive’s comment on center’s impact on earnings)
By Guillermo Parra-Bernal
MOGI MIRIM, Brazil, March 13 (Reuters) - Itaú Unibanco Holding SA, Brazil’s largest bank by market value, said on Friday it expected a new $1 billion data center to help curb its expenses and process transactions more rapidly by June of 2016.
The data center, which cost Itaú about 3.3 billion reais and is located in the southeastern city of Mogi Mirim, was inaugurated on Friday. The facility forms part of an 11.1-billion-real push to improve operational efficiency through technology investments.
The program is key for Chief Executive Roberto Setubal’s bet that strict cost controls and the offering of more products and services will counter the drag of a slowing economy and a potential increase in defaults this year.
The facility, measuring 151,000 square meters (180,500 square yards), will allow Itaú to cope with growing demand for financial transactions through 2050, Setubal said at a news conference.
Last year, Itaú processed 31 billion transactions. The new data center will allow that number to rise to 35 billion this year.
“This is a step towards preparing us for the future,” Setubal said.
Setubal’s efforts to focus on profitability and efficiency at the expense of market share has allowed the São Paulo-based lender to out-perform rivals every quarter for the past two years.
The data center is key to Itaú’s effort to continue growing its sales while keeping general and administrative expenses below annual inflation in the coming years, Setubal and other executives have repeatedly said. (Editing by Reese Ewing, Chizu Nomiyama and Paul Simao)