Inter & Co. Inc. (NASDAQ:INTR) highlighted a year of client growth, higher engagement, and expanding profitability during its latest earnings call, while fielding investor questions on efficiency, provisioning dynamics, and competition in private payroll lending. Management also pointed to organizational changes, including a new leadership framework, and discussed progress in building out its U.S. platform following regulatory approval for a branch license.
Client growth and engagement metrics
Executives said Inter delivered “another outstanding year of growth and profitability,” describing the company as the fastest-growing financial institution in Brazil among those with more than 20 million clients. Management reported welcoming 7 million new clients during the year, its “best annual performance ever,” and said 4.4 million of those became active. That brought activation to 58% and total active clients to 25 million, according to the company.
Transaction growth, Pix share, and shifting mix
Inter said transaction volumes continued to rise alongside activation. For the fourth quarter, total payment volume (TPV) grew 27% to a BRL 1.8 trillion run rate. Transactions through Pix totaled around BRL 1.5 trillion for the year, and the company said its Pix market share reached 8.5%.
Management also noted an ongoing shift in payment mix, with credit card volume outpacing debit card transactions for multiple quarters, which it said supported higher interchange fee income. Executives added that newer client cohorts are transacting faster and more frequently than older cohorts, supporting broader monetization.
Credit portfolio growth, asset quality, and funding
The company emphasized credit expansion as a major theme of the year. Management reported the loan book grew 36% year-over-year, with fourth-quarter growth accelerating to 10% (or 40% annualized). By segment, mortgages grew 48% year-over-year, home equity loans rose 35%, and credit cards increased 29%.
Inter also highlighted rapid scaling in private payroll loans, reaching approximately BRL 2 billion in portfolio after starting the year near zero. Executives said the broader loan book remained balanced at roughly two-thirds secured and one-third unsecured.
On asset quality, management said the 15- to 90-day non-performing loan (NPL) ratio improved 10 basis points to 4.0% from 4.1%. It also said the 90-day past due metric increased to 4.7% from 4.45%, which management tied largely to seasoning in the private payroll portfolio as early cohorts passed the 90-day mark. Executives said they anticipated the dynamic and “up-fronted provisions,” increasing the coverage ratio from 136% to 146% in the first nine months of the year. Cost of risk closed the year at 5.3%, which management said reflected a 10 basis point improvement driven mainly by credit cards.
Funding growth was another focus. Inter reported deposits grew 32% year-over-year and 7% quarter-over-quarter to nearly BRL 73 billion, with an average balance of BRL 2.1 thousand per active client. The company said time deposits drove much of the growth due to a high Selic rate environment and adoption of its “My Piggy Bank” product. Transactional deposits rose 10% in the quarter, passing BRL 20 billion. Loans-to-deposits increased to 66% from 64% as the company put more liquidity to work.
Management reiterated its “industry-leading” funding costs, reporting cost of funding of 65.6% of CDI, improving from 68.2% in the prior quarter.
Revenue, margins, expenses, and profitability
Inter reported total gross revenues of BRL 15 billion for 2025, up 45% year-over-year. Net revenues grew 31% to BRL 8.4 billion. Management said net interest income rose 41% year-over-year, driven by payroll loans, credit cards, mortgages, and home equity.
Net fee revenues increased 9% in the year, which executives said was moderated by accounting changes and the shifting of some monetization (including the introduction of buy now, pay later in Inter Shop) into net interest income. During Q&A, management said fee income ratio finished at 25% versus 30% in 2024, which it attributed to stronger expansion in net interest income. Executives cited fourth-quarter net fee revenue of BRL 579 million, pointing to growth in cards TPV, strength in investments (including 27% growth in UC), and more than 10 million insurance contracts, while noting pressure in Inter Shop from “Chinese players” in Brazil.
On unit economics, Inter said net revenue per active client (RPAC) reached BRL 35.1, a record, and mature clients generated BRL 91 in net RPAC. With cost to serve at BRL 13.8, management said gross margin per active client reached BRL 21.2 in the quarter. Management also said net interest margin metrics continued to reach record levels, supported by private payroll loans and credit cards, though it cited headwinds from lower inflation affecting real estate portfolio income and a higher number of business days increasing funding expense.
Expenses rose 25% year-over-year. Administrative expenses increased 8% quarter-over-quarter and 19% year-over-year, which management attributed to higher transaction volumes, while personal expenses increased due to seasonal profit-sharing provisions, an annual collective agreement, and team “seniorization.” Headcount remained around 4,100 employees through 2025. Depreciation and amortization increased 33% quarter-over-quarter, driven by a one-off impairment related to POS terminals. The company said its efficiency ratio improved to 45.5% from 48.4% within the year.
Inter reported net income of BRL 1.3 billion for the year and said it surpassed 15% return on equity (ROE) in the fourth quarter.
Key Q&A themes: efficiency targets, dividends, provisioning, and expansion
Investors pressed management on efficiency and the company’s multi-year “60/30/30” plan. CEO João Vitor said the plan was introduced three years ago as a five-year roadmap and cited progress including ROE moving from 0% to 15%, clients rising from 25 million to 43 million, and efficiency improving from 73% to 45%. He said the company remains committed and expects to discuss the timing and path to targets at an Investor Day in New York on May 11.
On dividends, management said Inter has paid dividends at a 20% payout ratio for three consecutive years and expects that “should be the trend going forward,” provided it does not impair growth execution.
Provisioning and asset quality were another focus. Management said private payroll seasoning drove some movement in NPL and Stage 3 formation metrics. It also described a change in mortgage staging methodology: starting in the fourth quarter, a performing mortgage could be migrated to Stage 3 if the same client had more than 90 days overdue in other credit lines. Management said this “catch-up” added BRL 140 million to Stage 3 balances in real estate during the quarter. Looking ahead, management said it expects cost of risk in 2026 to be between 5.5% and 6% depending on industry conditions.
Executives also discussed private payroll loan dynamics, including a portfolio near BRL 2 billion and about 500,000 clients, with an average ticket around BRL 4,000. Management said average interest rates have been relatively stable around 3.7% since inception and that loans are typically repaid over 20 installments. It also described origination sources as roughly one-third from active clients, one-third from reactivated inactive clients, and one-third from new clients. Management said it is proceeding cautiously as the product matures and collection tools evolve, noting it expects delinquency to converge to above 10% but below the initial plan that assumed up to 15%.
Internationally, João said Inter received approval for a branch license from the U.S. Federal Reserve and the Florida banking regulator, enabling the company to stop relying on a bank-as-a-service model for offering U.S. checking and investment accounts. He said the company has been building a U.S. ecosystem for more than two years—including remittance, investments, checking, cards, commerce, loyalty, and real estate products—and expects “more volumes” and fees over time, initially targeting immigrants and Latin American clients while also being able to serve U.S.-based clients.
About Inter & Co. Inc. (NASDAQ:INTR)
Inter & Co, Inc Is a holding company, which engages in the provision of financial products and services. It operates through the following segments: Banking, Securities, Insurance Brokerage, Marketplace, Asset Management, Service, and Other. The Banking segment offers checking accounts cards, deposits, loans and advances, and other services through mobile application. The Securities segment is involved in the acquisition, sale and custody of securities, the structuring and distribution of securities in the capital market, and the provision of administration services to investment funds.
