Year: 2020

Winner: BTG Pactual

BTG Pactual continued to expand its footprint in the region and in different segments of the financial world, despite the huge upheaval caused by the pandemic. Its net profits increased by a stellar 62.1% and return on equity was 19.1%, a strong increase from the previous period. Loans and deposits were up strongly, while non-performing loans dropped to 3.5%.

In the following abbreviated interview, CEO Roberto Sallouti talks about the bank’s actions during the pandemic and the factors that contributed to its winning the Bank of the Year award.

LF: The bank has been diversifying its products in capital and credit markets. What are some new examples of this?

Sallouti: “In 2019, we developed a digital financial platform to provide supply chain credit financing products in the segment of small and medium-sized enterprises (SMEs), which leverages on technology and strategic partnerships with key large corporate clients. We believe that our activities in this segment should expand in the next years due to our investments in our technology-based retail platform and market development. This integrated digital platform offers solutions to SMEs by granting access to products and services offered by BTG Pactual in the segments of credit, guarantees, insurance, investments, foreign exchange and derivatives, as well as access to our partners that offer solutions that optimize the management and maximize the productivity of these companies.”

LF: How has BTG Pactual stepped up in the new world context?

Sallouti: “The COVID-19 pandemic has dramatically altered the global landscape and has created enormous challenges for every aspect of society – from health and safety, to the economy, to friends and families. For firms like BTG Pactual, it presented a sudden need to adjust our operating model to ensure the health and safety of our employees while maintaining a high level of client service that has been key to our success. We are able to maintain the bank’s operations, with all services, communication channels and functionalities available to our clients, even with the majority of our employees working from home.”

LF: The pandemic has accelerated the disruption process in a number of segments. Do you see any new opportunities emerging from the crisis?

Sallouti: “In light of the crisis, with challenging and volatile market conditions, we found it extremely important to keep robust capitalization and high levels of liquidity while seizing various new opportunities. In June, we issued a follow-on share offering, raising of R$2.65 billion ($490 million) to accelerate strategic initiatives and growth of BTG Pactual’s Digital Retail Unit to offer a full spectrum of financial products and services while keeping strong capital metrics. It is an opportunity to grow corporate lending and supply chain financing with high credit quality and yield, and leading client franchises in Latin America.”

LF: What are some of the “lessons learned” in the past 12 months?

Sallouti: “We reacted fast in the beginning of the COVID-related volatility, reducing market risk, keeping high capital ratios and liquidity. As a result, we were greatly benefited by flight to quality – we were positively surprised by a significant increase in our unsecured funding when market volatility picked up. We were able to support clients in a moment of high demand for liquidity.”

“We have faced many crises over the last decades: fiscal, political instability, currency volatility, etc. For the first time, we’ve gone through an operational crisis. Our partnership model and sense of ownership that derives from it proved key to allow a prompt shift to a remote working environment while keeping operations running smoothly, even facing unprecedented increase in number of transactions.”