Bank of Brazil (BBAS3): Profit drops by more than 60% in 3Q25, to R$ 3.8 billion, but stays within expectations

Bank of Brazil (BBAS3) concluded the third quarter of 2025 with an adjusted net profit of R$ 3.8 billion, a 60% decrease from the same period a year ago, as shown in a document sent to the market this Wednesday (12). The figure was within the expected range projected by analysts, who were anticipating a net profit of R$ 3.2 billion. This marks the first decline in numbers after 16 consecutive quarters of annual profit growth. Furthermore, it was the only one among the major banks to show a decrease.
The tightening of regulations, such as the new CMN resolution No. 4,966/2021, which increased provisions for bad debts, contributed to the decline in profits of Bank of Brazil (BBAS3). This, coupled with the worsening of agribusiness delinquency, caused the bank to shift from a market favorite to a significant concern. Most analysts were already prepared for weak numbers. The Central Bank reported a profit of R$ 825 million for BB in August (compared to R$ 780 million in July), indicating an expected profit of R$ 2.4 billion for the quarter, considering non-recurrent items of R$ 700 million, usually linked to economic plans.
Since the third quarter of last year, Bank of Brazil has been feeling the effects of the agribusiness payment delays, with a considerable increase in judicial recoveries in the sector. The agricultural producer’s delinquency index in Brazil rose to 8.1% in the second quarter, a 0.3 percentage point increase from January to March, and a 1.1 percentage point increase compared to the previous year. Additionally, according to the survey, the majority of delinquencies are related to the financial sector. The Return on Equity (ROE) plummeted 6 percentage points, ending the quarter at 8%. Despite this, the profitability remained stable compared to the second quarter, with an average of five analysts consulted by Money Times expecting an 8% ROE.
Bank of Brazil not only fell below the 20% profitability benchmark, a key figure monitored by the market, but it also ended up lower than Itaú (ITUB4) with a 23% ROE, Santander (SANB11) at 17%, and Bradesco (BBDC4) at 14.8%. More information to follow.