Banco Bradesco (NYSE:BBD) reported recurring net income of BRL 6.5 billion for the fourth quarter of 2025, up 20.6% year over year, and BRL 24.7 billion for the full year, a 26.1% increase, according to executives on the bank’s earnings call held February 6. Management highlighted that return on average equity (ROAE) reached 15.2% in the quarter, which the bank said exceeded its cost of capital “for the first time” in that period.
CEO Marcelo Noronha framed the results as “cause and effect” of a transformation plan released in February 2024 with a five-year horizon. He said the bank intends to keep expanding ROAE in coming quarters and years while continuing to invest in technology and other initiatives to boost competitiveness.
Transformation plan: digital retail, affluent, and SME execution
On digital retail, management said the bank ended 2025 with 19 million “fully digital” clients supported through digital channels using BIA GenAI. Executives said BIA retains 90% of calls that come through digital retail and that the direct cost to serve clients on the digital platform was reduced “by 40x.” For 2026, management outlined an ambition to expand from 19 million to around 40 million digital clients, including account holders and non-account holders, while continuing to lower the cost to serve.
In affluent banking, management discussed two segments: Prime and Principal. The bank said it upgraded more than 3.1 million clients with a new value proposition and ended the year with 2.3 million Prime clients. Executives also cited 93% accuracy for BIA in that client base and said 3,500 managers were trained.
Principal, launched in November 2024, expanded to 62 offices in 36 municipalities by the end of 2025, serving about 320,000 clients. For 2026, management said it plans another upgrade of more than 1.5 million clients across the affluent segments, reaching 4.7 million clients, and intends to open nearly 50 additional Principal offices in São Paulo, expanding to 70 municipalities with nearly 800,000 clients by year-end.
In SMEs, Noronha said Bradesco’s market share rose to 16.6% by September 2025 from roughly 14.3%, crediting a more digital and remote service model, a revised management model, and new tools such as updated internet banking and a new corporate app. The bank disclosed a jump in Net Promoter Score (NPS) to 74 from 56. Management said the segment includes more than 5,000 managers and 2,100 service points, and it plans to increase penetration further as SMEs’ share of Brazil’s financial system grows over time.
Credit, risk, and loan growth
Management emphasized changes to credit governance, including the creation of a credit business unit, portfolio management and pricing functions, and the hiring of 250 professionals supported by technology. Executives said these efforts were aimed at improving risk-adjusted returns and enabling growth “with quality,” particularly in secured products.
The bank reported a loan portfolio of nearly BRL 1.1 trillion as of December 2025 and said portfolio growth accelerated to 11% versus 9.6% in the prior quarter. Executives highlighted micro, small, and medium-sized companies as a key driver, citing 21.3% growth.
Management said asset quality indicators were “flat,” with non-performing loans over 90 days and over 15 days described as stable. The bank cited BRL 10.5 billion in restructured portfolio in 2025 versus BRL 20.5 billion previously, describing this as a reduction in problematic assets. Executives also said Stage 3 exposures have been declining quarter after quarter, while Stage 1 has been increasing due to the evolution of a more secured portfolio.
Revenue trends: NII, fees, and insurance
Executives said total revenue was growing across lines, pointing to net interest income (NII) and fee and commission income. Management noted that excluding the Cielo tender offer, fee and commission income growth was 5.5%.
Net interest income was BRL 14.9 billion for the quarter, according to the presentation discussion, with client NII up 17.4%. Management also referenced client NII in the range of BRL 4.8 billion to BRL 10.3 billion, up 22.6%, while saying cost of risk was “under control and flat.”
On fees, executives highlighted:
- Credit income up 14.4%
- Consórcio up 17.3%, described as gaining traction
- Capital markets up 29.2% in full-year 2025 versus 2024, which management attributed to investments in teams and structure, including agribusiness and broader investment banking capabilities
Management also noted headwinds in checking accounts and collections as areas that “normally…pull the results down,” despite stronger performance elsewhere.
The insurance business was again described as a key strength. Executives cited ROE of 24.3% for the segment (nearly 22% for the full year) and said insurance and pension plans grew 16.1%, exceeding guidance. Management emphasized that growth was driven by operating results rather than financial results, and cited technical provisions coverage of 446% and more than 10% year-over-year growth.
Expenses, restructuring, and technology investment
Operating expenses increased 8.5% in 2025. Noronha said the biggest contributor was technology, with technology investments up 22% in 2025 versus 2024, and he reiterated that the bank will continue investing, describing an “AI first” culture. He also pointed to higher profit-sharing payments due to higher profitability.
When breaking down costs, management said personnel and administrative expenses grew 5%, in line with inflation (IPCA). Executives added that without profit-sharing, the increase would have been 2.5%. The bank also referenced ongoing footprint reductions, citing 2,800 points over the period discussed, and said that excluding Elopar and Cielo, operating expense growth would have been 7.2%.
In response to analyst questions about restructuring provisions and the 2026 expense outlook, management pointed to continued footprint review, planned openings of about 50 new Principal offices, and refurbishments in private banking locations. Noronha said some administrative cost lines declined (including third-party services and maintenance-related items), while technology spending remained a major focus. He also cited an efficiency ratio improvement of 2.2 percentage points to 50% and reiterated an ambition to reach 40% by 2028.
Capital, guidance, and management’s 2026 stance
On capital, executives said Tier 1 rose year over year (citing 12.4% to 13.2%), while common equity Tier 1 (CET1) was around 11.2% in the quarter. Management said it expects CET1 to remain around 11% through 2026, with potential fluctuations, noting expected regulatory impacts in the first quarter, including operating risk and “49.66.”
Management said the bank delivered at the top of its 2025 guidance in most lines, highlighting the expanded loan portfolio ending the year at 11% growth and insurance operations growth of 16.1% above guidance. Executives acknowledged that while they heard positive feedback on 2025 results, some investors expected higher 2026 guidance. Noronha said the bank would not “lose sight of our horizon” due to short-term share price adjustments.
During Q&A, management reiterated its focus on secured products as a lever for NII and emphasized growth opportunities in payroll lending, especially private payroll loans where it said Bradesco has lower market share and more room to expand. Executives also addressed Cielo’s integration, saying the payments unit has been transforming with improvements such as tap on phone, new pricing systems, and integration into Bradesco’s corporate app, while noting the bank chose to give up some large accounts rather than accept lower profitability.
On taxes, management said it is working with an expected tax rate of 16% to 21% (citing 18.5% to 19% for net income calculations) and discussed higher expected interest on equity payments in 2026 compared to 2025, as well as the impact of the earnings mix across subsidiaries with different tax rates.
Noronha closed by describing the quarter as the eighth consecutive period of improved delivery under the transformation plan, citing higher engagement across the organization and reiterating a step-by-step approach to execution.
About Banco Bradesco (NYSE:BBD)
Banco Bradesco SA is a major Brazilian financial institution headquartered in Osasco, São Paulo. Founded in 1943 by Amador Aguiar, the bank has grown into one of Brazil’s largest private-sector banks, offering a full range of financial services to retail, small and medium-sized enterprises, corporate and institutional clients. It operates across the banking value chain, including deposit-taking, lending, payments, trade finance and treasury services, and it participates actively in Brazil’s retail and corporate credit markets.
The company’s product and service mix extends beyond traditional banking to include insurance, pension plans, asset management, leasing and credit card services, delivered through a combination of branches, automated teller machines and digital channels.
