Brazil may be the poster child for the down and out, politically speaking, but Brazilian banks are laughing all the way to the “bank.” The two giant private banks, Bradesco and Itaú consistently earn returns on equity even when the government is falling apart, and when it has its political “fingers in the cookie jar” Banks turn up the financial heat in bad times. The two private banks manage to return 20 percent of each dollar invested every year. Big banks in the United States only realize 10 percent from each dollar invested.
Even when exports are down, and manufacturing is at a standstill, Brazilian banks are tearing it up, economically speaking. The four biggest banks in Brazil have revenue of more than $20 billion. Twelve years ago, revenue was only $2.1 billion. The funny thing is, 12 years ago Bradesco’s CEO, Luiz Carlos Trabuco, was turning in incredible profits figures as president of Seguros, Bradesco’s insurance division.
The 66-year-old Luiz Carlos Trabuco is not an ordinary banker in terms of education. He’s more thinker than numbers geek. And he has a long history of successes. Other Brazilian banks went into hibernation mode during the recession, Trabuco and his Bradesco team did all they could to build solid social programs within the bank. Mr. Trabuco knows receiving starts with giving, so he went to work and got employees in all 5,000 branches to care about giving back to the community. On the national level, Trabuco is happy to report the bank’s support for national programs. The Brazilian Green House Emissions Program, Companies for Climate Change, and Global Compact, as well as the Carbon Disclosure Program, are all part of Bradesco’s giving back program.
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Banco Bradesco is also turning heads on Wall Street. In the first quarter of 2017, the bank was on fire in terms of profits. More than R$9.3 billion went to Bradesco’s bottom line, and it looks like the second half will be another record breaker. Bradesco’s stock is trading at a little over $10 a share, and Wall Street analysts are pushing investors to buy more now. The economy may be in slow motion, but banks are reaping the rewards of insurance, government programs, bonds and a drop in interest rates. Even though the government is still in turmoil, the unemployment rate is dropping and so are inflation and interest rates.
It’s unfair to say Luíz Carlos Trabuco put the 43-year-old bank in this abundant position on his own, but it is fair to say Trabuco was the current maestro for the success of Bradesco. Bradesco’s Board of Directors had faith in Trabuco early in his banking career because Luiz is a banker with a solid psychology and philosophy background. He has a degree from the University of São Paulo, and a post-graduate’s degree in psychology. His banking career got off the ground in 1969, and after almost 40 years, he can say he knows how to manage banks. Trabuco is a team player. His list of duties would put much younger bankers under the table, but Trabuco still has the energy and knowledge to make a difference.
Mr. Trabuco is Vice-Chairman of the Board of Directors of Banco Bradesco, and he is the current President-Director of the Bradesco’s organization companies. Trabuco is Board Chairman of Directors of Elo Participações, and he is a member of the Board of Directors of Brazilian Federation of Banks. Plus, Mr. Trabuco serves on the Strategic Committee of Vale. But he also on the Executive Board of the National Confederation of Financial Institutions. Trabuco also was instrumental in Bradesco’s acquisition of HSBC in 2015.
Learn more about Luiza Carlos Trabuco: http://istoe.com.br/5442_NOVO+COMANDO/