SAO PAULO, Feb 4 (Reuters) - Banco Safra SA, a nonlisted Brazilian bank owned by billionaire financier Joseph Safra, said on Wednesday its net profit increased 14 percent last year as defaults hit a record low and expenses were kept in check.
The São Paulo-based bank said in a statement that net income totaled 1.55 billion reais ($562 million) in 2014, up from 1.36 billion reais in 2013. Return on equity rose to 19 percent.
The bank did not disclose data on interest and fee income, although it said noninterest expenses rose 6.8 percent, in line with annual inflation in Brazil. Banco Safra said its loan book rose 13 percent to 76.5 billion reais, of which 90 percent were loans with the least risky ratings.
The lender said its 90-day default ratio slid to the equivalent of 0.7 percent of outstanding loans, a 10-year low and the lowest among Brazil’s largest banks.
Banco Safra is Brazil’s largest nonlisted lender after state-controlled Caixa Ecopnômica Federal, and the No. 5 private-sector lender.
Banco Safra said its coverage ratio, a measure of a bank’s ability to absorb potential losses from a surge in nonperforming loans, rose to 481.4 percent at the end of December from 227 percent in 2013. The number signals it is keeping its loan-loss provisions elevated as Brazil’s economy flirts with recession.
Assets rose 8.5 percent last year to 142.9 billion reais, while assets under management reached 174.6 billion reais, the statement said.
$1=2.752 Brazilian reais Reporting by Guillermo Parra-Bernal and Aluísio Alves; Editing by Peter Galloway