There’s a new wind blowing through Itaú, and long-time watchers of the bank are noticing a renewed confidence. The firm is rediscovering its mojo.
For many years Brazil’s biggest private bank has been a little defensive in its posture. It still enjoys a position of market leadership, but has certainly never faced the level of competition that the emergence of digital players has brought in recently.
However, Itaú is under new management. Its chief executive, Milton Maluhy, and its CFO, Alexsandro Broedel, both took their seats at the beginning of 2021. Their strategy is already paying off, as is evident in the bank’s third-quarter results: profits are up by 38% to R$6.8 billion ($1.22 billion), return on equity is back above 20% in Brazil, and the bank is clearly delivering on its new strategy, picking up 5.7 million new digital clients in the quarter alone.
That strategy is called 'phygital': an amalgam of ‘physical’ and ‘digital’.
But whereas the physical element was often seen as a legacy weight, a cost burden dragging on Itaú’s ability to compete with digital platforms, the new management has strong ambitions for its branch network.
