Business Context and Reporting Period
This Form 6-K filing covers Banco Bradesco S.A.'s financial performance for the third quarter of 2025 (ended September 30, 2025). The bank reports continued positive performance driven by a strategic transformation, commercial traction, and controlled delinquency. Management emphasizes a focus on risk-adjusted returns and long-term competitiveness.
Key Financial Metrics
| Metric | 3Q25 Value | Q/Q Change | Y/Y Change |
|---|---|---|---|
| Recurring Net Income | R$6.2 billion | +2.3% | +18.8% |
| Return on Average Equity (ROAE) | 14.7% | +0.1 p.p. | +2.3 p.p. |
| Total Revenue | R$35.0 billion | +3.0% | +13.1% |
| Net Interest Income (NII) | R$18.7 billion | +3.7% | +16.9% |
| Client NII | R$18.6 billion | +4.8% | +19.0% |
| Fee and Commission Income | R$10.6 billion | +2.8% | +6.9% |
| Operating Expenses | R$16.5 billion | +3.7% | +9.6% |
| Efficiency Ratio | ~50.0% | Stable | Stable |
| Expanded Loan Portfolio | R$1,034 billion | +1.6% | +9.6% |
| Delinquency Ratio (>90 days) | 4.1% | Stable | -0.1 p.p. |
| Cost of Risk | 3.3% | +0.1 p.p. | +0.1 p.p. |
| Tier 1 Capital Ratio | 13.4% | +0.4 p.p. | +0.7 p.p. |
| Common Equity Ratio | 11.4% | N/A | N/A |
Material Changes vs. Prior Period
- Profitability Growth: Recurring net income rose 18.8% year-over-year, driven by a 19.0% increase in Client NII and a 13.0% increase in insurance income. The average spread improved from 8.8% in 2Q25 to 9.0% in 3Q25.
- Portfolio Expansion: The expanded loan portfolio grew 9.6% annually, led by the MSME segment (+24.8% y/y) and Individuals (+13.8% y/y). The share of secured credit lines increased to 59.5%.
- Asset Quality: While the total delinquency ratio remained stable at 4.1%, the MSME segment improved by 0.6 percentage points. The increase in the Individuals segment was primarily due to the consolidation of John Deere Bank operations. The restructured portfolio decreased by R$1.8 billion quarter-over-quarter.
- Expense Management: Operating expenses grew 9.6% y/y, largely reflecting strategic investments and the consolidation of John Deere Bank. Excluding profit-sharing, personnel and administrative expenses grew 2.5% y/y, below the 5.2% inflation rate.
- Insurance Performance: The insurance group reported net income of R$2.5 billion (+6.5% y/y) with an ROAE of 22.4%. The claims ratio improved by 5.9 percentage points year-over-year.
Guidance, Outlook, and Risks
2025 Guidance: Management maintains the following full-year 2025 estimates:
- Expanded Loan Portfolio: 4% to 8% growth (Actual 9M25: 9.6%).
- NII Net of Provisions: R$37 billion to R$41 billion (Actual 9M25: R$29.6 billion).
- Fee and Commission Income: 5% to 9% growth (Actual 9M25: 9.2%).
- Operating Expenses: 5% to 9% growth (Actual 9M25: 10.5%).
- Insurance Income: 9% to 13% growth (Actual 9M25: 21.7%).
Strategic Initiatives: The bank is accelerating footprint adjustments, opening new offices in the Principal segment, and enhancing digital platforms. It has achieved 100% of its target to allocate R$350 billion to socio-environmental activities by year-end.
Risks and Contingencies:
- John Deere Bank Consolidation: Impacted delinquency metrics in the Individuals segment and increased loan loss provisions, though these assets are collateralized.
- Wholesale Provisions: Increased cost of risk was driven by specific wholesale cases.
- Forward-Looking Statements: Results are subject to economic conditions, industry trends, and regulatory changes (e.g., CMN Resolution No. 4,966/21).
Investor Verification Checklist
- John Deere Bank Impact: Verify the specific exposure and recovery timeline for the John Deere Bank portfolio included in the Individuals segment.
- Cost of Risk Trajectory: Monitor the cost of risk (currently 3.3%) to ensure the increase in wholesale provisions is not a recurring trend.
- Expense Run-Rate: Confirm if the 10.5% year-to-date expense growth aligns with the full-year guidance of 5-9% given the seasonal nature of the remaining quarter.
- Secured Portfolio Mix: Validate the sustainability of the 59.5% secured credit line ratio as a risk mitigation strategy.
- Insurance Claims Ratio: Assess the durability of the 5.9 p.p. improvement in the claims ratio across all insurance segments.