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Non-interest expenses rose 3.1% y/y, while the cost of credit increased 7.4%.
Itau Unibanco Holding S.A. (ITUB - Free Report) reported recurring managerial results of R$12.4 billion ($2.42 billion) for the second quarter of 2026, which increased 7.8% year over year.
Results were driven by higher operating revenues and an increase in the managerial financial margin. However, higher non-interest expenses and cost of credit remained headwinds.
ITUB’s Revenues & Expenses Increase
Operating revenues were R$47.9 billion ($9.37 billion) in the reported quarter, up 4.7% year over year.
The managerial financial margin increased 5.2% year over year to R$33.5 billion ($6.54 billion). Also, commissions and fees rose 2.3% year over year to R$11 billion ($2.15 billion).
Non-interest expenses totaled R$16.7 billion ($3.27 billion), up 3.1% year over year. This increase was primarily driven by higher personnel, transactional, technology, marketing, event and third-party service expenses.
In the second quarter, the efficiency ratio was 37.4% compared with 38% in the year-ago quarter. A decrease in this ratio indicates improved profitability.
The cost of credit charges rose 7.4% on a year-over-year basis to R$10.1 billion ($1.98 billion).
Itau Unibanco’s Balance Sheet Position Improves
As of June 30, 2026, ITUB’s total assets rose nearly 1% sequentially to R$3.23 trillion ($629.9 billion). Liabilities, including deposits, debentures, securities, borrowings and on-lending, totaled R$3 trillion ($587.4 billion), which rose nearly 1% on a sequential basis.
As of the same date, Itau Unibanco’s credit portfolio, including private securities and financial guarantees provided, rose 2.7% sequentially to R$1.52 trillion ($297.2 billion).
ITUB’s Capital & Profitability Ratios Mixed
As of June 30, 2026, the Common Equity Tier 1 ratio was 12.3%, down from 13.1% as of June 30, 2025.
Annualized recurring managerial return on average equity was 24.3%, up from 23.3% in the year-earlier quarter.
Our View on Itau Unibanco
ITUB’s second-quarter results were driven by growth in operating revenues and the managerial financial margin. The lower efficiency ratio suggests improved profitability. Growth in commissions and fees, along with a sequential increase in the credit portfolio, remains encouraging. However, higher non-interest expenses and cost of credit remain concerns.
Itau Unibanco Holding S.A. Price, Consensus and EPS Surprise
Deutsche Bank (DB - Free Report) reported second-quarter 2026 earnings attributable to its shareholders of €1.64 billion ($1.87 billion), up 10.5% year over year.
DB’s increased revenues across all four business segments aided results. However, higher non-interest expenses and provisions for credit losses were headwinds.
UBS Group AG (UBS - Free Report) reported a second-quarter 2026 net profit attributable to shareholders of $2.80 billion compared with $2.39 billion in the prior-year quarter.
UBS’ results were driven by strong performances in the Global Wealth Management, Personal & Corporate Banking, Asset Management and Investment Bank divisions. An increase in total assets and invested assets was also encouraging. However, higher operating expenses acted as a headwind.
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Itau Unibanco Q2 Earnings & Revenues Rise Y/Y Despite Higher Expenses
Key Takeaways
Itau Unibanco Holding S.A. (ITUB - Free Report) reported recurring managerial results of R$12.4 billion ($2.42 billion) for the second quarter of 2026, which increased 7.8% year over year.
Results were driven by higher operating revenues and an increase in the managerial financial margin. However, higher non-interest expenses and cost of credit remained headwinds.
ITUB’s Revenues & Expenses Increase
Operating revenues were R$47.9 billion ($9.37 billion) in the reported quarter, up 4.7% year over year.
The managerial financial margin increased 5.2% year over year to R$33.5 billion ($6.54 billion). Also, commissions and fees rose 2.3% year over year to R$11 billion ($2.15 billion).
Non-interest expenses totaled R$16.7 billion ($3.27 billion), up 3.1% year over year. This increase was primarily driven by higher personnel, transactional, technology, marketing, event and third-party service expenses.
In the second quarter, the efficiency ratio was 37.4% compared with 38% in the year-ago quarter. A decrease in this ratio indicates improved profitability.
The cost of credit charges rose 7.4% on a year-over-year basis to R$10.1 billion ($1.98 billion).
Itau Unibanco’s Balance Sheet Position Improves
As of June 30, 2026, ITUB’s total assets rose nearly 1% sequentially to R$3.23 trillion ($629.9 billion). Liabilities, including deposits, debentures, securities, borrowings and on-lending, totaled R$3 trillion ($587.4 billion), which rose nearly 1% on a sequential basis.
As of the same date, Itau Unibanco’s credit portfolio, including private securities and financial guarantees provided, rose 2.7% sequentially to R$1.52 trillion ($297.2 billion).
ITUB’s Capital & Profitability Ratios Mixed
As of June 30, 2026, the Common Equity Tier 1 ratio was 12.3%, down from 13.1% as of June 30, 2025.
Annualized recurring managerial return on average equity was 24.3%, up from 23.3% in the year-earlier quarter.
Our View on Itau Unibanco
ITUB’s second-quarter results were driven by growth in operating revenues and the managerial financial margin. The lower efficiency ratio suggests improved profitability. Growth in commissions and fees, along with a sequential increase in the credit portfolio, remains encouraging. However, higher non-interest expenses and cost of credit remain concerns.
Itau Unibanco Holding S.A. Price, Consensus and EPS Surprise
Itau Unibanco Holding S.A. price-consensus-eps-surprise-chart | Itau Unibanco Holding S.A. Quote
Itau Unibanco currently carries a Zacks Rank #3 (Hold). You can seethe complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Foreign Banks
Deutsche Bank (DB - Free Report) reported second-quarter 2026 earnings attributable to its shareholders of €1.64 billion ($1.87 billion), up 10.5% year over year.
DB’s increased revenues across all four business segments aided results. However, higher non-interest expenses and provisions for credit losses were headwinds.
UBS Group AG (UBS - Free Report) reported a second-quarter 2026 net profit attributable to shareholders of $2.80 billion compared with $2.39 billion in the prior-year quarter.
UBS’ results were driven by strong performances in the Global Wealth Management, Personal & Corporate Banking, Asset Management and Investment Bank divisions. An increase in total assets and invested assets was also encouraging. However, higher operating expenses acted as a headwind.