EX-99.1 2 v451716_ex99-1.htm EXHIBIT 99.1

 

Exhibit 99.1

 

 

 

Announcement to the Market

 

Disclosure of results for the third quarter of 2016 and from January to September of
2016, according to International Financial Reporting Standards – IFRS

 

We present below the differences between our financial statements in BRGAAP1 and in International Financial Reporting Standards - IFRS. We emphasize that the main difference in the result and equity relates to the allowance for loan losses, that uses the concept of incurred loss in IFRS and of expected loss in BRGAAP.

 

The complete consolidated financial statements under IFRS for the third quarter and from January to September of 2016 are available at our website: www.itau.com.br/investor-relations

 

Comparison between BRGAAP1 and IFRS                      R$ million 
       Adjustments and           Adjustments and     
Balance Sheet  BRGAAP   Reclassifications 2   IFRS   BRGAAP   Reclassifications 2   IFRS 
       Set/30/2016           Dec/31/2015     
Total Assets   1,399,099    (74,977)   1,324,122    1,359,172    (82,758)   1,276,415 
Cash and Cash Equivalents, Reserve Requirements, Interbank Deposits, Securities Under Repurchase Agreements, Financial Assets and Derivatives 3   732,831    (11,426)   721,405    704,487    (14,520)   689,967 
Loan Operations   495,327    353    495,680    473,829    419    474,248 
(-) Allowance for Loan Losses 4   (39,103)   8,773    (30,330)   (34,078)   7,234    (26,844)
Other Financial Assets 5   105,644    (54,763)   50,881    122,637    (69,132)   53,506 
Tax Assets 6   61,409    (17,276)   44,133    61,707    (9,557)   52,149 
Investments in associates and jointly controlled entities, Goodwill, Fixed and Intangible Assets, Assets Held for Sale and Other Assets   42,991    (639)   42,353    30,590    2,798    33,389 
                               
Current Liabilities and Long Term Liabilities   1,271,111    (82,553)   1,188,558    1,250,955    (88,600)   1,162,356 
Deposits   308,599    -    308,599    292,610    -    292,610 
Deposits Received Under Securities Repurchase Agreements 3   360,337    (12,547)   347,790    350,954    (14,311)   336,643 
Financial Liabilities Held for Trading, Derivatives, Interbank and Institutional funding   261,041    299    261,340    282,575    (288)   282,287 
Other Financial Liabilities 5   118,468    (54,529)   63,939    137,212    (68,498)   68,715 
Reserves for Insurance, Private Pension and Capitalization   150,134    620    150,754    132,053    295    132,349 
Provisions and Other Liabilities   55,508    (4,107)   51,401    44,943    (161)   44,781 
Tax Liabilities 6   17,024    (12,289)   4,735    10,608    (5,637)   4,971 
                               
Total Stockholders' Equity   127,988    7,576    135,564    108,217    5,842    114,059 
Non-controlling interests   13,273    349    13,622    1,755    52    1,807 
Controlling Stockholders' Equity 7   114,715    7,227    121,942    106,462    5,790    112,252 

1BRGAAP represents the accounting practices adopted in Brazil for financial institutions, according to regulation of the Brazilian Central Bank;

2Resulted from reclassifications between assets and liabilities and other effects from IFRS adoption;

3Resulted from the elimination of transactions between the parent company and exclusive funds (mainly PGBL and VGBL fund quotas), which are consolidated under IFRS;

4Implementation of the criteria for calculating the Allowance for Loan Losses as defined in IFRS;

5Difference in accounting, mainly for Foreign Exchange Portfolio, which started to be considered as net effect of Assets and Liabilities;

6Difference in accounting, mainly for deferred taxes, which are now treated as a net effect of Assets and Liabilities in each of the consolidated companies;

7Conciliation of Controlling Stockholders' Equity is presented in the following table.

 

Itaú Unibanco Holding S.A.

 

 

 

 

Below, the conciliation of the Result and Equity, and the conceptual description of the major adjustments.

 

Conciliation                      R$ million 
Adjustments  Equity   Result 
   Set/30/16   3tdQ/16   2ndQ/16   3tdQ/15   jan-sep/16   jan-sep/15 
BRGAAP - Values Attributable to Controlling Stockholders   114,715    5,394    5,518    5,945    16,097    17,662 
(a) Allowance for Loan Losses   5,387    24    470    2,682    1,085    2,375 
(b) Adjustment to market value of shares and quotas   240    -    -    -    -    - 
(c) Acquisition of interest in Porto Seguro Itaú Unibanco Participações S.A.   460    (4)   (3)   (4)   (11)   (11)
(d) Effective interest rate   (71)   5    8    10    25    28 
(e) Financial Leasing Operation   715    37    38    520    123    520 
(f)  Other adjustments   497    105    (32)   50    (47)   147 
IFRS - Values Attributable to Controlling Stockholders   121,942    5,561    5,999    9,202    17,271    20,720 
IFRS - Values Attributable to Minority Stockholders   13,622    61    323    96    371    295 
IFRS - Values Attributable to Controlling Stockholders and Minority Stockholders   135,564    5,622    6,322    9,298    17,642    21,015 
Differences between IFRS and BRGAAP Financial Statements

(a) On IFRS (IAS 39), loan losses allowances must be made when there is objective evidence that loan operations have suffered a reduction in its value (Incurred Loss). On BRGAAP, the expected loss model is used 8 .

(b) On IFRS (IAS 39 and 32), stocks and quotas classified as permanent investments were measured at fair value and its gains and losses were recorded directly on Equity, with no impact on the income statement of the period.

(c) On IFRS, the effect of accounting at fair value the acquisition of the participation in Porto Seguro Itaú Unibanco Participações S.A. was recognized.

(d) On the IFRS (IAS 39), the assets and financial liabilities measured at amortized cost are recognized according to the methodology of effective interest rate, which appropriates the revenues and costs directly attributed to the acquisition, issue or disposal for the period of operation. On BRGAAP, the recognition of expenses and revenues from fees occurs at the time of contracting these operations.

(e) Under IFRS (IAS 17) the financial leasing operations are recorded as Fixed Assets on the other hand of Other Financial Liabilities. On BRGAAP, as of September 30, 2015, the consideration of these transactions are now recorded in income in accordance with CMN Resolution No. 3,617/08.

(f) Other Adjustments mainly comprise the difference in the eligibility of operations of the Cash Flow Hedge for purposes of IFRS and the reversal of the Goodwill Amortizations pursuant the BRGAAP.

 

8For more details see our Complete Financial Statements for the period from january to september of 2016.

 

For comparison purposes, we present on the table below the Result and the Recurring Result according to the IFRS and the BRGAAP.

 

                                           R$ million 
Recurring Result  3tdQ/16   2ndQ/16   jan-sep/16   jan-sep/15 
   BRGAAP   IFRS   Variation   BRGAAP   IFRS   Variation   BRGAAP   IFRS   Variation   BRGAAP   IFRS   Variation 
Result - Attributale to Controlling Stockholders   5,394    5,561    167    5,518    5,999    481    16,097    17,271    1,174    17,662    20,720    3,058 
Exclusion of the Non-Recurring Events   200    80    (120)   56    40    (16)   308    140    (168)   397    (2,969)   (3,366)
Goodwill Amortization   120    -    (120)   156    -    (156)   308    -    (308)   130    37    (93)
Liability Adequacy Test - LAT   -    -    -    (140)   -    140    (140)   -    140    -    -    - 
Increase of the Social Contribution Rate   -    -    -    -    -    -    -    -    -    (3,988)   (3,948)   40 
Complementary provision for loan losses   -    -    -    -    -    -    -    -    -    2,793    -    (2,793)
Provision for Contingencies   80    80    -    31    31    -    143    143    -    668    668    - 
Civil Lawsuits - Economic Plans   80    80    -    31    31    -    136    136    -    108    108    - 
Tax and Social Security   -    -    -    -    -    -    6    6    -    560    560    - 
Changing the accounting treatment of financial leasing   -    -    -    -    -    -    -    -    -    520    -    (520)
Pension Fund   -    -    -    -    -    -    -    -    -    130    130    - 
Impairment   -    -    -    9    9    -    9    9    -    43    43    - 
Program for the Settlement or Installment Payment of Taxes   -    -    -    -    -    -    (12)   (12)   -    (40)   (40)   - 
Others   -    -    -    -    -    -    -    -    -    143    143    - 
Recurring Result - Attributable to Controlling Stockholders   5,595    5,641    46    5,574    6,039    465    16,405    17,410    1,006    18,059    17,752    (307)

 

The tables in this report show the figures in millions. Variations and summations, however, are calculated in units.

 

São Paulo, October 31, 2016.

 

Marcelo Kopel

Investor Relations Officer

 

Itaú Unibanco Holding S.A.