Banco Bradesco 4Q16 Results

SAO PAULO, Feb. 2, 2017 /PRNewswire/ -- The main figures reported by Bradesco(BBDC4) in 2016, with emphasis on the consolidation, from July 1, 2016, of HSBC Bank Brasil S.A. and its subsidiaries (HSBC Brasil):

1. Adjusted Net Income(1) for 2016 stood at R$17.121 billion (a 4.2% decrease compared to the Adjusted Net Income of R$17.873 billion recorded in 2015), corresponding to earnings per share of R$3.09 and Return on Average Adjusted Shareholders' Equity(2) of 17.6%(2).

2. As for the source, the Adjusted Net Income is composed of R$11.570 billion from financial activities, representing 67.6% of the total, and of R$5.551 billion from insurance, pension plans and capitalization bond operations, which together account for 32.4%.

3. In December 2016, Bradesco's market capitalization stood at R$160.813 billion(3), showing a growth of 60.7% over December 2015.

4. Total Assets, in December 2016, stood at R$1.294 trillion, an increase of 19.8% over the December 2015 balance. The return on Average Assets was 1.5%.

5. In December 2016, the Expanded Loan Portfolio(4) reached R$514.990 billion, an increase of 8.6% over December 2015. Operations with individuals totaled R$172.045 billion (an increase of 16.4% over December 2015), while operations with companies totaled R$342.945 billion (a 5.1% increase over December 2015).

6. Assets under Management stood at R$1.905 trillion, a 26.1% increase over December 2015.

7. Shareholders' Equity totaled R$100.442 billion in December 2016, 13.0% higher than in December 2015. The Basel III Ratio, based on the Prudential Conglomerate stood at 15.4% in December 2016, 12.0% of which is Tier I Capital.

8. A total of R$6.976 billion was paid and provisioned to shareholders as Interest on Shareholders' Equity for the profit generated in 2016, of which R$2.168 billion was paid monthly and in interim periods, and R$4.808 billion was provisioned as extraordinary and complementary, to be paid on March 8, 2017.

9. The Interest-earning portion of the NII stood at R$63.059 billion, an increase of 15.1% compared with 2015.

10. The 90-day Delinquency Ratio was 5.5% in December 2016 (4.1% in December 2015).

11. The Operating Efficiency Ratio (ER)(5) in December 2016 was 39.5% (37.5% in December 2015), while the "risk-adjusted" efficiency ratio stood at 52.2% (46.5% in December 2015).

12. Insurance Written Premiums, Pension Plan Contributions and Capitalization Bond Incomes totaled R$71.419 billion in 2016, up 10.5% when compared with 2015. Technical provisions stood at R$223.342 billion, an increase of 25.6% compared with the balance in December 2015.

13. Investments in infrastructure, information technology and telecommunications amounted to R$6.595 billion in 2016, up 15.3% over 2015.

14. Taxes and contributions paid or provisioned, including social security, totaled R$32.202 billion in 2016, of which R$13.782 billion was related to taxes withheld and collected from third parties, and R$18.420 billion, was calculated based on activities developed by the Bradesco Organization, equivalent to 107.6% of the Adjusted Net Income(1).

15. Bradesco has an extensive Customer Service Network in Brazil, with 5,314 Branches and 3,821 Customer Service Points (PAs). Customers of Bradesco can also count on 1,013 ATMs located on company premises (PAEs), 38,430 Bradesco Expresso customer service points, 36,119 Bradesco ATMs, and 19,991 Banco24Horas Network ATMs.

16. Payroll, plus charges and benefits totaled R$15.540 billion in 2016. Social benefits provided to all 108,793 employees of the Bradesco Organization and their dependents amounted to R$3.792 billion, while investments in education, training and development programs totaled R$175.583 million.

Major Awards and Acknowledgments in the period:

• Brazil's largest private-sector business group (Anuário Grandes Grupos/ Valor Economico newspaper);

• It was the Latin American bank that increased the most in assets in 12 months (in US dollars) – from October 2015 to September 2016, a 38.09% increase (Economatica);

• It was the leader in "Market Capitalization" growth among all financial institutions listed on the Stock Exchange (Economatica / Exame);

• It was the winner of the 18th Abrasca award with the "Best Annual Report", in the "Public Company" category – companies with net revenues equal to or greater than R$3 billion";

• It was the leader of the "Folha Top of Mind' survey, in the "Top Finances" category, as one of the most remembered brands in savings, health insurance, insurance, and credit cards (Datafolha);

• It featured in the "The Best in Personnel Management" survey (Valor Economico newspaper with technical support from Aon);

• It was the leader of the financial sector list in the "The Best Companies for the Consumer" award, in the categories "Banks, Banks and Financial Services – Cards and Insurance" (Epoca magazine);

• Bradesco Corretora led the ranking with the "Top 10" recommended portfolio, which ensured greater profitability to investors, from January to September 2016, and also achieved best return in 2016, in the "Value Portfolio" category (Valor Economico newspaper);

• BRAM was recognized in 23 investment funds managed as excellent in the "Best Funds for Institutional Investors" ranking (Luz Engenharia Financeira); and

• BRAM achieved first place in the "Leadership in ALAS 20's Responsible Investments" category, it was second place in the "Leadership in Corporate Governance" category, and won third place in "Leadership in Research and Sustainability".

Bradesco Organization is fully committed to the socio-economic development of the country. We set our business guidelines and strategies with a view of incorporating the best corporate sustainability practices, considering the context and the potential of each region, thus contributing to the generation of shared value in the long term. To reinforce this positioning, we highlight the adherence to corporate initiatives recognized worldwide, such as the Global Compact, the Equator Principles, Carbon Disclosure Project (CDP), Principles for Responsible Investment (PRI), GHG Protocol Program (Brazilian Greenhouse Gas Emission Program) and Empresas pelo Clima (EPC - Businesses for the Climate Platform). Our governance structure includes the Sustainability Committee, responsible for advising the Board of Directors on establishing guidelines and corporate actions for this area, and with the multi-departmental Committee responsible for coordinating the strategy's implementation. Excellence in business management is recognized by the main indexes of Sustainability, such as the Dow Jones Sustainability Index (DJSI) – "Emerging Markets", of the New York Stock Exchange, the Corporate Sustainability Index (ISE), and the Carbon Efficient Index (ICO2), both from BM&FBOVESPA.

With a broad social and educational program put in place 60 years ago, Fundacao Bradesco operates 40 schools across Brazil. In 2016, a budget of R$595.6 million benefited 108,533 students enrolled in its schools at the following levels: Basic Education (from Kindergarten to High School and Higher Secondary Technical-Professional Education), youth and adult education; and preliminary and continued vocational training, focused on creating jobs and income. In addition to the guarantee of free, quality education, the students enrolled in the Basic Education system, numbering over 41 thousand, also receive uniforms, school supplies, meals, and medical and dental assistance. With regard to the distance learning system (EaD), more than 657 thousand students benefited from it through its e-learning portal "Escola Virtual" (Virtual School). These students concluded at least one of the various courses offered in its schedule, and another 31,756 students will benefit from projects and initiatives carried out in partnership with Centers for Digital Inclusion (CDIs), the Educa+Acao Program, and from Technology courses.

The Financial Statements can be found on Bradesco's Investor Relations website at bradesco.com.br/ir.

According to the non-recurring events described on page 8 of this Economic and Financial Analysis Report; (2) As of the first quarter of 2016, the annualized profitability has been calculated on a linear basis, and also, it excludes mark-to-market effect of Available-for-Sale Securities recorded under Shareholders' Equity; (3) Number of shares (excluding treasury shares) multiplied by the closing price for common and preferred shares on the last trading day of the period; (4) Includes sureties and guarantees, letters of credit, advances on credit card receivables, co-obligations in loan assignments (receivables-backed investment funds and mortgage-backed receivables), co-obligations in rural loan assignments and operations bearing credit risk – commercial portfolio, which includes debentures and promissory notes; and (5) In the last 12 months.

CONTACT: Ivani Benazzi de Andrade +011-55-11-2194-0924, ivani.andrade@bradesco.com.br or Carlos Tsuyoshi Yamashita, +011-55-11-2194-0920, carlos.yamashita@bradesco.com.br, both from Banco Bradesco.