May 21, 2020 / 12:28 PM / 6 days ago

Brazilian state lender Caixa reports 22% fall in Q1 net income

SAO PAULO, May 21 (Reuters) - Brazilian state-owned lender Caixa Economica Federal posted a 22.2% drop in first-quarter net income to 3.049 billion reais ($535.62 million) as gains with loans and trading income fell.

Net interest income, a measure of earnings on loans minus deposit costs, fell 13.9% from a year earlier, the bank said.

The bank’s loan book rose 0.9% from December and 2% from a year earlier, to 699.6 billion reais, mainly on mortgages.

Loan loss provision expenses fell 28.8% as the bank said its loan book had moved towards less risky assets.

Brazil’s biggest lenders, such as Itau Unibanco Holding SA and Banco Bradesco SA, have increased provisions, bracing for the crisis stemming from the coronavirus pandemic.

Fee income was down 0.7% due to drops in checking account and mutual funds fees.

Caixa’s tier 1 capital rose to 12.9%, up 0.42 percentage points from the previous quarter.

$1 = 5.6925 reais Reporting by Carolina Mandl

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