Brazilian broker XP’s profit gains from higher assets under custody
2022.08.09 23:30
FILE PHOTO: General view of XP Inc. headquarters in Sao Paulo, Brazil December 11, 2019. REUTERS/Amanda Perobelli
(Reuters) – XP (NASDAQ:XP) Inc posted a marginal jump in second-quarter adjusted profit as the Brazilian broker gained from a surge in assets under custody that offset a slowdown in inflows due to higher interest rates.
Last week, Brazil’s central bank raised its key interest rate by half a percentage point to battle the impacts of fuel and food shocks that have kept consumer prices rising above 10% a year even as growth remains subdued.
The country’s largest brokerage said its net inflows of 43 billion reais ($8.36 billion) were 43% lower from a year ago, while the total purchase value on XP’s credit card rose 161% to 5.5 billion reais.
Assets under custody rose 4% to 846 billion reais as people poured money into its diverse range of products such as bonds, derivatives and pension funds, while active client numbers rose 16%.
The company’s adjusted net income rose 1% to 1.05 billion reais in the second quarter and net revenue jumped 14%.
Retail gross revenue rose 14% to 2.79 billion reais, while institutional revenue saw a 16% jump to 436 million reais.
($1 = 5.1454 reais)
