Brazil's Itau may pay extra dividend this year, says CEO
SAO PAULO, May 7 (Reuters) -Brazilian lender Itau Unibanco ITUB4.SA has been working with some excess of capital and will "calibrate" it towards the end of the year to potentially pay extra dividends, Chief Executive Milton Maluhy Filho said on Tuesday.
Brazil's largest private sector lender on Monday reported a 15.8% growth in its first-quarter profit, accompanied by improving profitability and lower default rates.
"Our policy will be to work with adequate capital to face the challenges, grow the bank, invest in the business - this is our main goal," Maluhy Filho told reporters in a press conference.
"If we have a (capital) surplus, the idea is to distribute it and pay a new extraordinary dividend," he added.
Itau remains attentive to opportunities for inorganic growth with the same "discipline" in capital allocation, the CEO said, although pondering that the bank is quite comfortable with its size and capacity for organic growth at the moment.
Preferred shares in Itau were up more than 1.6% in morning trading in Sao Paulo, while Brazil's benchmark stock index Bovespa .BVSP rose 0.9%.
Goldman Sachs analysts led by Tito Labarta said in a note to clients that Itau's latest results should be well-received by market participants and reinforce the outlook for earnings growth and dividend distribution.
"While Itau's adjustment in risk appetite likely limits growth, we think this has proven to create value on a risk-adjusted basis," they added.
Reporting by Paula Arend Laier; Writing by Peter Frontini; Editing by Gabriel Araujo and Franklin Paul
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