CAIXA Reports Net Income of R$3.9 Billion in 1Q19, 23% Higher Than 1Q18

BRASILIA, Brazil, June 24, 2019 /PRNewswire/ -- CAIXA ECONOMICA FEDERAL ("CAIXA" or "Bank"), the largest Brazilian bank in terms of number of clients, announces its consolidated results for the first quarter of 2019 (1Q19).

In the first quarter of 2019, under a new management, CAIXA started a process of redirecting its strategy to becoming a more profitable bank and more focused on valuing the Brazilian society. Thus, the Company defined 7 pillars for the coming years, including: Meritocracy, Cost Control, Lending, Governance, Monetization of Assets, More Brazil Program and Legacy.

Financial and Operational Highlights:

• The 1Q19 net income growth was mainly due to higher revenue from services, a 24.4% reduction in expenses with allowance for loan losses (PDD), and the stable financial margin in relation to 1Q18.
      
• Revenue from services increased by 2.3% in the last 12 months, reaching R$6.5 billion until March 2019, influenced by the 19.8% increase in services from investment funds and an 8.5% increase in revenue from agreements and banking fees.
      
• Gross financial intermediation reached R$9.6 billion in 1Q19, up by 10.6% in the last 12 months and mainly influenced by the 24.4% reduction in expenses with provisions for possible loan losses.
      
• Return on Average Equity (ROAE) was 15.8% in March 2019, stable compared to March 2018. The return on average assets (ROAA) reached 1.0%, increasing by 0.2 p.p. in 12 months.
        
• The Operating Efficiency Index reached 48% in 12 months, a slight growth of 0.4 p.p. The coverage ratio of administrative expenses increased by 2.5 p.p. and reached 79.4% and the coverage ratio for personnel expenses totaled 123%, improving by 3.4 p.p. in 12 months.
       
• Payment of social benefits increased 6% compared to 1Q18, reaching R$7.6 billion in 1Q19.

1Q19 Earnings Call and webcast: June 24, 2019, 11:00 a.m. (US EDT), Phone: +1 (412) 317-6346, Code: CAIXA and/or webcast on https://webcastlite.mziq.com/cover.html?webcastId=f4049ddd-c8a2-46d2-98fa-d1ce669b02da

1Q19 disclosure documents: 1Q19 earnings release, presentation and full financials already available: www.caixa.gov.br/sobre-a-caixa/relacoes-com-investidores/

Contact: Investor Relations, [email protected]

About Caixa Economica Federal (www.caixa.gov.br): CAIXA is the largest Brazilian bank in terms of number of clients totaling 93 million, with 96 million debit cards, accounting for 37% of national savings and 69% of housing loans.

SOURCE CAIXA ECONOMICA FEDERAL