UPDATE 3-Itaú profit tops view, sees small rise in provisions; shares jump

martes 2 de agosto de 2016 10:47 GYT

(Recasts to add share performance, comments throughout)

Aug 2 (Reuters) - Itaú Unibanco Holding SA handily beat second-quarter profit estimates in a sign that efforts to curb expenses and reclassify problem loans will buffer profitability, sending shares higher on Tuesday.

Itaú, Latin America's largest bank by market value, kept a lid on defaults and cut loan disbursements as Brazil's worst recession in decades led to a doubling of bankruptcies over the past year.

Chief Executive Officer Roberto Setubal slightly raised loan-loss provision estimates, fanning hopes that credit losses may soon bottom out.

Recurring net income, or profit before one-off items, totaled 5.575 billion reais ($1.7 billion) last quarter, up 8 percent from the prior three months. Profit beat the analysts' consensus estimate of 5.025 billion reais as compiled by Thomson Reuters.

Easing political turmoil may help pull Brazil out of a lengthy crisis, analysts said. Brazil's top four listed banks, seeking to help their debt-laden corporate clients, probably reclassified about 90 billion reais in problem loans last quarter, a move that analysts said will facilitate a recovery.

"Itaú posted solid bottom-line numbers, further indicating that results for Brazilian banks have likely bottomed," said Tito Labarta, an analyst with Deutsche Bank Securities.

Preferred shares, Itaú's most widely traded class, gained as much as 2.7 percent. However, shares in rivals fell, in line with a 0.6 percent drop in Brazil's benchmark Bovespa index.

If a recovery materializes in the coming months, demand for credit could recover and credit-related losses will decline significantly, according to Marcelo Kopel, Itaú's head of investor relations. The bank has a sufficient capital buffer to ramp up operations if a recovery takes hold rapidly, he said.   Continuación...