August 10, 2017 / 2:24 PM / a year ago

Banco do Brasil sees return on equity converging on cost of capital

SAO PAULO, Aug 10 (Reuters) - Banco do Brasil SA’s operations could soon be profitable again in the coming quarters, executives said on Thursday, underscoring efforts to cut costs and boost efficiency as interest rates decline.

In an event to discuss second-quarter results, Chief Executive Officer Paul Rogêrio Caffarelli and other executives said return-on-equity could soon equalize the bank’s cost of capital, without elaborating.

The indicator of profitability commonly known as ROE ended last quarter at 10.7 percent, with analysts calculating Banco do Brasil’s cost of capital at about 13 percent. (Reporting by Aluísio Alves; Writing and additional reporting by Guillermo Parra-Bernal)

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