institutional presentation 2nd quarter of 2020
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This presentation may contain certain forward-looking statements and
information pertaining to Banco Santander (Brasil) S.A. (“Santander
Brasil”) and its subsidiaries, which reflect the current views and / or
expectations of Santander Brasil and its management regarding its
business performance and future events.
Forward-looking statements include, without limitation, any statement
that may predict, forecast, indicate or imply future results, performance
or achievements, and may contain words such as “believe”, “anticipate”,
“expect”, “estimate”, “could”, “forecast”, “potential”, “will likely result”, or
other words or expressions of similar meaning.
Such statements are subject to several risks, uncertainties and
assumptions. We caution that a number of important factors may cause
actual results to differ substantially from the plans, objectives,
expectations, estimates and intentions expressed herein.
We do not undertake any obligation to update or revise any forward-
looking statements, whether as a result of new information, future events
or otherwise. In no event shall Santander Brasil, or any of its subsidiaries,
affiliates, shareholders, directors, officers, employees or agents be liable
to any third party (including investors) for any investment or business
decision or action taken in reliance on the information and statements
contained in this presentation or for any consequential, special or similar
damages.
In addition to factors identified elsewhere in this presentation, the
following factors, among others, may cause actual results to differ
materially from the forward-looking statements or historical
performance: changes in the preferences and financial condition of
our consumers and competitive conditions in the markets in which
we operate, changes in economic, political and business conditions
in Brazil; government interventions, resulting in changes in the
Brazilian economy, taxes, tariffs or regulatory environment; our
ability to compete successfully; changes in our business; our ability
to successfully implement marketing strategies; our identification of
business opportunities; our ability to develop and introduce new
products and services; changes in the cost of our products and
operating costs; our level of indebtedness and other financial
obligations; our ability to attract new customers; inflation in Brazil;
the devaluation of the Brazilian Real against the U.S. Dollar and
interest rate fluctuations; current or future changes in laws and
regulations; and our ability to maintain existing business
relationships and create new relationships.
DISCLAIMER
1
2
3
4
5
6
INDUSTRY OVERVIEW: MACROECONOMY AND FINANCIAL SYSTEM
SANTANDER BRASIL PROFILE
CORPORATE STRATEGY
OUR BUSINESSES
FINANCIAL HIGHLIGHTS
APPENDICES
-8.97
0.56
-12.04
-30
-20
-10
0
10
20
Industrial production Retail sales Volume of services
-3.55
0.90
3.905.20
10.67
2.31
K E Y A S P E C T S O F T H E BRAZILIAN MARKET
GDP (%)
SELIC RATE (%)
INFLATION (%)
FX (BRL/USD)
GRADUAL ECONOMIC RECOVERY WEIGHED DOWN BY THE COVID-19 GLOBAL CRISIS
LOWEST LEVEL IN HISTORY
ANCHORED EXPECTATIONS
FREE FLOATING EXCHANGE RATE
2015 2Q201 ECONOMIC ACTIVITY PERFORMANCE
SOCIAL INDICATORS
+210MM
2Q20 BRAZILIAN
POPULATION
ESTIMATE
13.3%
2Q20
UNEMPLOYMENT
RATE
14.25
2.00
+110 bps2Q20 vs. 1Q20
+130 bps2Q20 vs. 2Q19
4Sources: Brazilian Central Bank and IBGE. ¹ Latest available data
17.815.7
C H A R A C T E R I S T I C S O F T H E
BRAZILIAN MARKET
PUBLIC PENSION REFORM AT THE STATE AND
MUNICIPAL LEVEL;
DECOUPLE AND DE-INDEX PUBLIC SPENDING;
RESTRUCTURE SOCIAL WELFARE BY REFINING
THE “BOLSA FAMÍLIA” PROGRAM;
CURB MANDATORY SPENDING;
TAX REFORM;
CREATION OF INCENTIVES TO INCREASE
NATIONAL SAVINGS;
TEMPORARY MEASURES TO COUNTER THE
ECONOMIC IMPACT OF COVID-19;PRIMARY BALANCE AND GROSS DEBT (% of GDP)
L A Y I N G T H E G R O U N D W O R K F O R
T H E E C O N O M I C R E B O U N D
TOTAL INVESTMENT (% of GDP)
2006 2019
BRAZIL RISK (CDS 5 years, bps)
CONTINUED LIQUIDITY IN THE GLOBAL
ECONOMY
5
2006 2019
Sources: Brazilian Central Bank and Santander
50
55
60
65
70
75
80
-4
-2
0
2
4
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Primary balance Gross debt
102100
339 371 407 407 414309
19.2% 19.6% 19.4%17.2% 16.0%
9.5%
Dec-15 Dec-16 Dec-17 Dec-18 Dec-19 Jun-20
Reserve Requirement (R$ Billion)
Reserve Requirement/Total Deposit⁴
Deposits4;
37.5%
AuM
(Anbima);
53.4%
Other5;
9.2%
SOLID N A T I O N A L F I N A N C I A L S Y S T E M
BRAZILIANMARKET PROFILE
Concentrated
5 LARGEST BANKS
74% 72%
BIS RATIO²: 17.1%,
ABOVE THE 10.25%
REQUIRED BY THE
BRAZILIAN CENTRAL
BANK
COVERAGE RATIO³:
239.6%
TOTAL LOAN
+1.1%
R$ 3,625 bi
+7.8%
R$ 8,690 bi
TOTAL FUNDINGSolid
¹ As disclosed by each institution, as of June 2020. ² Brazilian Central Bank, as of December 2019. ³ Brazilian Central Bank, as of June 2020. 4 Total deposit considers demand, savings and time
deposits. 5 Including debentures, real estate credit notes (LCI), agricultural credit notes (LCA), financial bills, secured real estate notes (LIG) and structured transaction certificates (COE)6
Q o Q
Q o Q
J U N - 2 0
J U N - 2 0
TOTAL LOAN SHARE
Loans¹ Deposits¹
56%
47%44%
53%
Public banks Private banks
Dec-15 Jun-20
87.5
78.8
Jun
-16
Oct
-16
Feb
-17
Jun
-17
Oct
-17
Feb
-18
Jun
-18
Oct
-18
Feb
-19
Jun
-19
Oct
-19
Feb
-20
Jun
-20
Business Confidence Index Consumer Confidence Index
46.5
27.3
19.2
Jun
-16
Sep
-16
Dec-1
6
Mar-
17
Jun
-17
Sep
-17
Dec-1
7
Mar-
18
Jun
-18
Sep
-18
Dec-1
8
Mar-
19
Jun
-19
Sep
-19
Dec-1
9
Mar-
20
Jun
-20
Household debt ratio Without mortgage loans Mortgage loans
2.9%
3.6%
2.0%
1%
2%
3%
4%
5%
Jun
-16
Sep
-16
Dec-1
6
Mar-
17
Jun
-17
Sep
-17
Dec-1
7
Mar-
18
Jun
-18
Sep
-18
Dec-1
8
Mar-
19
Jun
-19
Sep
-19
Dec-1
9
Mar-
20
Jun
-20
Total Individuals Corporate
B R A Z I L I A N F I N A N C I A L S Y S T E M PROFILE
PROVISION FOR LOAN LOSSES RATE – BY SEGMENT | BY INSTITUTION
HOUSEHOLD DEBT (%)
CONFIDENCE INDICES (points)
7¹ Sources: Brazilian Central Bank and FGV/IBRE
2.9%2.6%
3.1%
1%
2%
3%
4%
5%
Jun
-16
Sep
-16
Dec-1
6
Mar-
17
Jun
-17
Sep
-17
Dec-1
7
Mar-
18
Jun
-18
Sep
-18
Dec-1
8
Mar-
19
Jun
-19
Sep
-19
Dec-1
9
Mar-
20
Jun
-20
Total Public Private
1
2
3
4
5
6
INDUSTRY OVERVIEW: MACROECONOMY AND FINANCIAL SYSTEM
SANTANDER BRASIL PROFILE
CORPORATE STRATEGY
OUR BUSINESSES
FINANCIAL HIGHLIGHTS
APPENDICES
SANTANDER BRASIL’S C O N S O L I D A T E D F O O T P R I N T I N T H E B R A Z I L I A N M A R K E T
SANTANDER GROUP STARTS OPERATING IN
BRAZIL¹ THROUGH A
REPRESENTATIVE OFFICE
ACQUISITION OF BANCO GERAL DO COMÉRCIO
ACQUISITION OF BANCO
REAL
ACQUISITION OF BANCO
NORDESTE S.A.
ACQUISITION OF THE MERIDIONAL CONGLOMERATE
ACQUISITION OF BANESPA
(PRIVATIZATION)89% ACQUISITION
OF GETNET
ACQUISITION OF BANCO
BONSUCESSO CONSIGNADO
70% ACQUISITION OF RETURN
51% ACQUISITION OF LOOP
100% ACQUISITION OF GETNET
100% ACQUISITION OF RETURN
ACQUISITION OF SUPERDIGITAL
1970 1997 1998 2000 2007 2014 2016 2017 2018 2019
ACQUISITION OF OLÉ
CONSIGNADO
2020
INITIAL PUBLIC OFFERING
(IPO)
2009
VOLUNTARY EXCHANGE TENDER OFFER (“OPA”)
COMMERCIAL TRANSFORMATION NPS
PROFITABILITY AMONG THE BEST IN THE INDUSTRY
A NEW WAY OF DOING BUSINESS
INTEGRATION OF PLATFORMS
CONSOLIDATION OF DIFFERENT
BRANDS
9¹ In 1982 opened its first branch
BANK W I T H STRONG PRESENCE I N B R A Z I L
10
¹ Considers disbursement in renewable energy, sustainable agribusiness, Prospera Santander Microfinance, Project Finance (renewable energy), other socio environmental businesses, student
financing (undergraduate medicine), ESG Linked-Loan; participation in structuring and advisory of Green Bonds/Transition Bonds; and advisory in Project Finance (renewable energy). 2 As of
December 2019. Source: 2016 GDP by Geographical Region – IBGE
Jun-20
26.8MM
Active customers
• 5.7MM loyal
customers (+5%)
• 14.5MM digital
customers (+14%) Loan Portfolio
R$ 383BI
• R$ 157Bi Individuals
• R$ 57Bi Consumer Finance
• R$ 47Bi SMEs
• R$ 123Bi Corporate
88.6%Loan portfolio/ Funding
from customers
~ 105BI
Market Capitalization
• Operating in all Brazilian
states
• 9.85% free float
• 46.3k employees
+ 7.9BI
Socio-environmental
business made viable¹
Southeast
South
Northeast
Mid-West + North
9.1% of Santander
branches
70.1% of Santander
branches
7.1% of Santander branches
13.9% of GDP2
54.9% of GDP2
16.4% of GDP2
14.7% of GDP2
26 Agri branches
13.7% of Santander branches
9 Agri branches
3 Agri branches
8 Prospera branches
2 Prospera branches
12 Prospera branches
2 Agri branches
77 Prospera
branches
C O R P O R A T E GOVERNANCE
SHAREHOLDERS MEETING
BOARD OFDIRECTORS (BOD)
ADVISORY COMMITTEES TO THE BOARD
EXECUTIVE COMMITTEE
FISCAL COMMITTEE
STRUCTURE
• EXECUTIVE COMMITTEE: COMPOSED OF CEO AND EXECUTIVE VICE-PRESIDENTS
• EXECUTIVE OFFICERS
ABOUT THE BOARD OF DIRECTORS (“BOD”)
FIVE OF THE NINE MEMBERS OF THE BOARD OF DIRECTORS ARE INDEPENDENT
THE POSITIONS OF CHAIRMAN OF THE BOARD OF DIRECTORS AND CHIEF EXECUTIVEOFFICER MAY NOT BE HELD BY THE SAME PERSON
BALANCE OF KNOWLEDGE AND RELEVANT EXPERIENCE
33% WOMEN ON THE BOARD OF DIRECTORS
COMPOSITION OF THE BOARD OF DIRECTORS (“BOD”) AND COMMITTEES
BOD
Advisory Committees to the Board
AuditNomination and
GovernanceCompensation
Risks and
ComplianceSustainability
# Members 9 3 3 3 4 5
Independent
Directors 5 1 2 2 2 1
Non-independent
Directors4 - - - 1 -
Independent
Members- 2 1 1 1 1
Non-independent
Members- - - - - 3
11
TECHNOLOGY A N D DIGITAL TRANSFORMATION S U P P O R T I N G O U R F U T U R E
SIMPLIFICATION OF PROCESSES AND TOOLS
BROADER RANGE OF PRODUCTS AND SERVICES 86% of total transactions
+ LAUNCHES
+ FUNCTIONALITIES
+ BUSINESS
DIGITAL CHANNELS
SECURE AND EFFICIENT SALES PLATFORMSONGOING IMPROVEMENT IN CUSTOMER
SERVICE
BETTER SALES INDICATORS “GENTE” LAUNCH
35% OF BANK SALES TAKE PLACE IN THE
DIGITAL ENVIRONMENT
ONLINE PURCHASE CARD ACCOUNTS
FOR 36% OF ALL BANK CARD
TRANSACTIONS
OUR ARTIFICIAL INTELLIGENCE, AVAILABLE FOR
OUR CUSTOMERS
17% OF MOBILE USERS HAVE ALREADY
INTERACTED WITH “GENTE”
NPS IN MOBILE BANKING AMONG INDIVIDUALS
WHO HAVE USED “GENTE” REACHED 76POINTS
12
S O L I D RISK C U L T U R E
G R O U P
GLOBAL RISK
CONTROL
PLATFORMS
CREDITRISK
LIQUIDITY RISK
OPERATIONAL RISK
MONEY LAUNDRY
PREVENTION
MODEL RISK
COMPLIANCE LEGAL
REPUTATIONAL RISK
CONDUCT RISK
STRUCTURAL RISK
MARKET RISK
STRATEGIC RISK DATA
PROCESSESGOVERNANCE
METHODOLOGY
2nd
LINE OF DEFENSE
RISK CONTROL AND COMPLIANCE
ENSURING THAT THE RISKS ARE MANAGED IN ACCORDANCE WITH THE AGREED RISK APPETITE
3rd
LINE OF DEFENSE
INTERNAL AUDIT
REVIEW OF CONTROLS, PROCESSES AND MANAGEMENT
ALL BUSINESS UNITS AND SUPPORT AREAS
PART OF SANTANDER´S DAILY BUSINESS
GENERATED, OWNED AND MANAGED BY THE BUSINESS
1st
LINE OF DEFENSE
RISKS ARE CALIBRATED IN THE GROUP, ENABLING BUSINESS CONTINUITY AND PREDICTABILITY IN THE FACE OF DIVERSE HISTORY
MANAGEMENT AND CONTROL OF THE ACTUAL LOCAL RISK PROFILE ENSURE THE MODEL’S ROBUSTNESS
LOAN CONCENTRATION
RISKJUN-20
131%
7%11%
18%24%
LARGEST DEBTOR
10 LARGEST
20 LARGEST
50 LARGEST
100 LARGEST
W E A R E PA R T O F A LARGE GROUP
14
DIVERSIFIED PRESENCE ACROSS THREE
REGIONS ALLOWS FOR BETTER AND FASTER
EXECUTION
NORTH
AMERICA
U.S. AND
MEXICOSOUTH AMERICA
BRAZIL, ARGENTINA,
CHILE, URUGUAY
AND ANDEAN
REGION
EUROPE
SPAIN, PORTUGAL, POLAND,
UNITED KINGDOM AND
SANTANDER CONSUMER
FINANCE
UNDERLYING ATTRIBUTABLE PROFIT DISTRIBUTION ASSIGNED
BY GEOGRAPHIC REGION | 1H20
SUBSIDIARY MODEL WITH LIQUIDITY AND
CAPITAL AUTONOMY LIMITS THE POSSIBILITY
OF CONTAGION BETWEEN GROUP UNITS,
REDUCING SYSTEMIC RISK
Europe,
35%
South
America,
45%
North
America,
20%
BRAZIL CONTRIBUTED TO 32%OF GROUP’S 1H20 RESULTS
1H20
ASSETS 1,572, 881
CUSTOMERS LOAN(NET)
934,796
TOTAL EQUITY 91,859
UNDERLYING ATTRIBUTABLE PROFIT
1,908
BRANCHES 11,847
EMPLOYEES 194,284
LOYAL CUSTOMERS (MILLION) 21.5
EUR million
1
2
3
4
5
6
INDUSTRY OVERVIEW: MACROECONOMY AND FINANCIAL SYSTEM
SANTANDER BRASIL PROFILE
CORPORATE STRATEGY
OUR BUSINESSES
FINANCIAL HIGHLIGHTS
APPENDICES
O U R STRATEGIC PRIORITIES A R E B A S E D O N FOUR PILLARS
STRONG CORPORATE CULTURE |
ENGAGED PEOPLE
ABILITY TO ATTRACT,
DEVELOP AND RETAIN
TALENTS. ENGAGING
OUR PEOPLE TO
PROVIDE A STATE-OF-
THE-ART CUSTOMER
SERVICE
RECURRENCE AND CAPITAL DISCIPLINE |
CREATING SHAREHOLDER VALUE
BUILDING A SUSTAINABLE BUSINESS |
RESPONSIBLE BANKING
DOING BUSINESS WHILE
CONTRIBUTING TO THE
ECONOMIC AND
SOCIAL PROGRESS OF
COMMUNITIES
MAINTAIN LIQUIDITY
AND CAPITAL
DISCIPLINE TO
GENERATE
SUSTAINABLE AND
PROFITABLE RESULTS,
WITH SOLID RISK
MANAGEMENT AND
RIGOROUS COST
CONTROL
OUR PURPOSE IS TO HELP PEOPLE AND BUSINESSES PROSPER
PREFERENCE AND LOYALTY |
CUSTOMER-FOCUSED
PROVIDE SUITABLE
OFFERS TO MEET
CUSTOMERS’ NEEDS,
WHILE DELIVERING A
STATE-OF-THE-ART
CUSTOMER SERVICE
EXPERIENCE
OURCOMMUNITIES
OURSHAREHOLDERS
OURCUSTOMERS
OURPEOPLE
16
NEW WAY OF WORKING
ADAPTING TO PROTOCOLS
A CULTURE THAT SUPPORTS
OUR PEOPLE
17
25%BLACK EMPLOYEES
13TH SALARY PAID IN APRIL AND PROFIT-SHARING PAYMENT ADVANCE
33%WOMEN IN THE BOARD
OF DIRECTORS
WE VALUE DIVERSITY
FINANCIAL SUPPORT
WE ARE ONE OF THE BEST COMPANIES TO
WORK FOR
WOMANETHNIC-RACIAL
HIGHLIGHT FOR THE 2ND
CONSECUTIVE YEAR
ETHNIC-RACIALBEST COMPANY IN THE
FINANCIAL SECTOR
OURPEOPLE
CUSTOMER-FOCUSED B U S I N E S S M O D E L
CONTINUOUS BUSINESS
IMPROVEMENTSERVICE
CUSTOMER JOURNEYDIGITALIZATION
SATISFACTION
SERVICE SPECIALIZATION
SPECIALTY STORES
SIMPLIFYING PROCESSES AND SERVICES
-28% LEAD TIME TO ORIGINATE MORTGAGE LOANS (YoY)
APPROPRIATE OFFERS FOR CUSTOMER PROFILE
INNOVATION
PIONEERS IN PUBLICLY DISCLOSING THE NPS
61 POINTS (+3 POINTS YoY)
~2MM REQUESTS PER MONTH
LEADERS IN SATISFACTION,
ACCORDING TO IBOPE¹
RAPID ADAPTATION TO A NEW WAY OF WORKING
DIGITAL CHANNELS
PRODUCTIVITY CULTURE OF BRANCHESCLUSTERS
IMPLEMENTATION OF DISRUPTIVE TECHNOLOGIES
ONE PAY-FX BLOCKCHAIN
COMMERCIAL STRATEGY REALIGNMENT
+18% IN TOTAL LOAN AGREEMENTS IN THE QUARTER
NPS
PART OF THE ORGANIZATION’S KPIS
EXECUTIVE EXPERIENCE IN BUILDING HIGH SATISFACTION LEVELS
1INCREASE CUSTOMER SATISFACTION
SUSTAINABLE EXPANSION OF OUR CUSTOMER BASE
2
MARKET SHARE GROWTH IN STRATEGIC PRODUCTS AND SERVICES
3
¹ As of first half of 2020. Since 2014, IBOPE has carried out Santander’s Benchmark project, whose main objective is to gauge customers’ satisfaction and willingness to recommend
the bank and its direct competitors. The survey is based on a quantitative methodology, with interviews conducted through the “CATI” technique (computer assisted telephone
interviewing), using a list provided by IBOPE. Sample: 5,870 interviews/year
OURCUSTOMERS
18
C R E A T I N G SHAREHOLDER VALUE
ROBUST ECOSYSTEM AS A VALUE GENERATION TOOL
•CROSS-SELLECOSYSTEMS: (i) AUTO
(ii) PAYMENTS
•NEW INITIATIVES
•WHOLESALE ENHANCEMENT
(i) CAPITAL MARKETS(ii) ENERGY AND COMMODITIES
DESKS
SOLID BALANCE SHEET AND ASSET QUALITY
PREDICTIVE RISK MODELS THAT ENABLE FAST ADJUSTMENT TO DIFFERENT CIRCUMSTANCES
•FOCUS ON LOWER RISK PRODUCTS
• INDIVIDUALS COLLATERALIZED LOAN PORTFOLIO+ PAYROLL LOANS/ INDIVIDUALS LOAN
PORTFOLIO
% +437bps QoQ
OPERATIONAL EXCELLENCE BY INDUSTRIALIZING THE VALUE
CHAIN
•LOWER UNIT COST PER SERVICE
•DIGITAL TRANSFORMATION
%REWORK IN BUSINESS
ACCOUNT OPENINGS AT OUR BRANCHES
SUSTAINABLE RESULTS AND SOLID PROFITABIL IT Y19
OURSHAREHOLDERS
RESPONSIBLE BANKING A M I D A N E W B U S I N E S S E N V I R O N M E N T
CONTRIBUTING TO BUILD A SOCIETYWITH INCLUSIVE AND SUSTAINABLEGROWTH IS PART OF OUR DNA
R$ 7.9Bi Socio-
environmental business made
viable in the year2
R$1.2Bi credit for
microentrepreneurs (Prospera Santander
Microfinance)
30K Scholarships
granted3
68KParticipations
in financialeducation programs
Committed to TOMORROW
As of June 2020. 1Local Goal. 2Considers disbursement in renewable energy, sustainable agribusiness, Prospera Santander Microfinance, Project Finance (renewable energy), other
socio environmental businesses, student financing (undergraduate medicine), ESG Linked Loan; participation in structuring and advisory of Green/Bonds Transition Bonds; and
advisory in Project Finance (renewable energy). 3Since 2015
Green
and
Transition
Bonds
37%
Project Finance
34%
Microfinance
17%
Renewable energy
6%
Others 6%
20
GOAL
ACHIEVEMENT
OURCOMMUNITIES
100% of renewable energy
consumptionby 2025
Elimination of single-use plastic of our
operations by 2020
30% of Womenin executive
leadership roles by 20211(1st stage: administrative
centers; 2nd stage: branches)
34% 27%100%
1st stage: administrative
centers
1ST CBIOS DEAL
SUSTAINABLE BUSINESS INITIATIVES
1ST GREEN BOND ISSUANCE
IN THE TRANSPORTATION AND LOGISTICS INDUSTRY
LAUNCH OF THE “SANTANDER GO”
FUND
21
OURCOMMUNITIES
1ST ESG-LINKED LOAN
PIONEERS IN
STRUCTURING THE
ISSUANCE OF
DESCARBONIZATION CREDITS
(“CBIOs”) – A BIOFUEL-
INDUSTRY FINANCIAL
PRODUCT TRADED ON THE
EXCHANGE
1ST LOAN IN THE
BRAZILIAN MARKET
WITH INTEREST RATES
PEGGED TO
SUSTAINABLE GOALS
LEADERSHIP AS GLOBAL
COORDINATOR AND
SUSTAINABILITY
ADVISOR FOR THE
ISSUANCE OF GREEN BONDS
ESG-FOCUSED FUND IN
PARTNERSHIP WITH THE
ASSET MANAGER ROBECO,
FOCUSING ON COMPANIES
THAT HAVE SOLID
SUSTAINABILITY CRITERIA
“PLANO AMAZÔNIA “10 MEASURES AIMED AT SUSTAINABLE
DEVELOPMENT OF THE AMAZON
REGION
PLAN TO PROMOTE SUSTAINABLE
DEVELOPMENT OF THE AMAZON BY THE THREE
LARGEST PRIVATE BANKS IN THE COUNTRY
1
2
3
4
5
6
INDUSTRY OVERVIEW: MACROECONOMY AND FINANCIAL SYSTEM
SANTANDER BRASIL PROFILE
CORPORATE STRATEGY
OUR BUSINESSES
FINANCIAL HIGHLIGHTS
APPENDICES
SCALABLE A N D D I V E R S I F I E D BUSINESS MODEL A C R O S S A L L O P E R A T I N G U N I T S
COMMERCIAL BANKING WHOLESALE BANKING
INDIVIDUALS“SANTANDER
FINANCIAMENTOS”SMEs CORPORATE SCIB
CONSUMER FINANCE
CORPORATE
SMEs
CONSUMER FINANCE
INDIVIDUALS
TOTAL CREDIT PORTFOLIO
B R O A D P O R T F O L I O O F P R O D U C T S A N D S E R V I C E S | S A N T A N D E R E C O S Y S T E M
PRODUCT AND SEGMENT BREAKDOWN (share in total loans)
INDIVIDUALS CONSUMER FINANCE
CORPORATE
23
JUN-20R$ billion
Leasing/Vehicles; 2%
Credit Card;
19%
Payroll Loans;
29%Mortgage loans;
24%
Agricultural
loans; 4%
Personal Loans
and Others; 22%
Vehicles; 91%
Others; 9%Leasing/Vehicles; 2% Agricultural Loans; 4%
Foreign Trade;
25%
Onlending; 6%
Mortgage Loans;
1%
Working
Capital and
Others; 62%
45% 41%
17% 15%
12% 12%
27% 32%
317.6 382.9
Jun-19 Jun-20
M O R E T H A N 26.8 M M A C T I V E CUSTOMERS S E R V E D B Y O U R B U S I N E S S
5.7MMLoyal
customers
14.5MMDigital
customers
///
REMOTE
PHYSICALDIGITAL
COMPLETE SERVICE INFRASTRUCTURE
24
+40% E-COMMERCE
SALES YoY²
3.5MM CALLS
MADE TO THE CALL
CENTER / MONTH
7% CHANNEL
SALES
35% CHANNEL SALES
56% CHANNEL
SALES
1.3MM CURRENT
ACCOUNT HOLDERS
AT OUR STORES
DURING PEAK DAY1
As of June 2020. ¹Average number of account holders per hour who enter our stores in Brazil and perform banking transactions through an ATM or Teller. Peak Day: 5th business day.
² 1H20 vs. 1H19
CREDIT AND DEBIT CARDSOLÉ CONSIGNADO (PAYROLL LOANS)
CONSUMER FINANCE PAYROLL AND SAVINGS
ACCOUNTS LENDING PRODUCTS
INVESTMENT“CONSÓRCIO”
CAPITALIZATIONINSURANCE
GETNET AND SUPERDIGITAL CUSTOMIZED PRODUCTS
CAPITAL MARKETS ADVISORY
PRODUCT PORTFOLIO
+5% YoY
+14% YoY
S E G M E N TA T I O N TA I L O R E D T O T H E R E A L I T Y O F
O U R CUSTOMERS
Santander | Private Banking
Santander | Select
Santander | Van Gogh
Santander
Investments above R$ 5MM
Monthly income above R$ 10,000¹ or R$ 300,000 in investments
Monthly income from R$ 4,000 to R$ 10,000 or R$ 40,000 in investments
Monthly income below R$ 4,000
RELATIONSHIP | SEGMENT-ORIENTED VALUE PROPOSITIONS FOR INDIVIDUALS
RELATIONSHIP | SEGMENT-ORIENTED VALUE PROPOSITIONS FOR BUSINESSES
SCIB(Santander Corporate &
Investment Banking)
Negócios Agência
Empresas PoloEmpresas Núcleos
Corporate
Negócios MEI
WHOLESALE
SMEs
(up to R$ 81k in revenue)
(up to R$ 3MM in revenue)
(up to R$ 30MM in revenue)
(up to R$ 200MM in revenue)
25¹ It includes R$ 30,000 in investments
26
MARKET SHARE¹
F U N D I N G
11.1%
L O A N
10.6%
PROJECT FINANCE³
WHOLESALELEADERSHIP POSITION
1ST
FOREIGN EXCHANGE41ST
DERIVATIVES52ND
FINANCIAL ADVISOR
2020: Latam7
M&A LATAM62ND
SPEED TO INNOVATE AND REINVENT
AUTO ECOSYSTEM
“TROCA + TROCO” CAR DELIVERY
CUSTOMER SELLS THE
CURRENT FINANCED VEHICLE,
FINANCES THE PURCHASE OF
A CHEAPER ONE, AND
POCKETS THE DIFFERENCE
CUSTOMER PURCHASES
THE VEHICLE AT A
PARTNER STORE, AND IT
GETS DELIVERED TO
HIS/HER HOME
6.99% p.a.
JUL-20
ORIGINATION
MoM
+46%
MORTGAGE “USECASA”
(HOME EQUITY)
R$ 2.0BiLOAN BOOK
(JUN-20)
VEHICLES ORIGINATION²
JUL-20 MoM+16%INTEREST RATE
JUN-20
MORTGAGEVEHICLES
INDIVIDUALSSMEsPAYROLL LOANS
5.8%
+11bps YoY
25.3%
+7bps YoY
11.4%
+79bps YoY
9.4%
+101bps YoY
¹ Source: Brazilian Central Bank, as of June 2020. It refers to portfolio book. ² It includes Individuals and Corporate. ³ According to Dealogic as Global Financial Advisor for deals announced
in Brazil and in the international market, and according to ANBIMA as Financing Advisor for transaction amounts and number of deals. 4 Brazilian Central Bank, as of 5M20. 5 B3, as of
5M20. 6 Deal announced. 7 LatinFinance
WELL POSITIONED TO CAPTURE NEW OPPORTUNITIES
W I T H I N T E G R A T E D
S O L U T I O N S F O R
O U R C U S T O M E R S E-COMMERCE
1.6MM POS DEVICES
18% YoY
TURNOVER
22% YoY
PRE-PAYMENT
13% YoY
ACTIVE BASE
GETNET A S A B U S I N E S S P L A T F O R M
+45% YoY
PHYSICAL
PRICING TECHNOLOGY BANKING ADDED VALUE LOWER COST PER
TRANSACTION
27
ONLINE STORE
QR CODE FOR EMERGENCY AID
ADDITIONAL POS DEVICES FOR DELIVERY SALES
15%MARKET SHAREAMBITION TO ACHIEVE A TURNOVER OF UP TO IN 2020
Consulting
Conciliation
Bank Slip
Debit/Credit
Recurrence
Safe
Antifraud
Checkout
MarketplaceSolution
Digital Platform for SMEs
LEVERAGING O U R E C O S Y S T E M T H R O U G H
NEW BUSINESSES
DEBT RENEGOTIATION PLATFORM
AUTO INSURANCE CORPORATE BENEFITS
MARKETPLACE OFFERING VOUCHERS AND
FORGING PARTNERSHIPS
CREDIT PLATFORM WITH CUSTOMIZED OFFERS
FOR INDIVIDUALS
LAUNCH: 2019
CUSTOMERS: +2MM
LOAN PORTFOLIO
VOLUME: R$ 400MM
LAUNCH: 2019 LAUNCH: 2019 LAUNCH: 2020
CUSTOMERS: 2MM PARTNER ESTABLISHMENTS: 300K
FULLY DIGITAL BUSINESSES | BREAKEVEN IN 2020
VOLUME: R$ 187MM
CONSUMER FINANCE PENETRATION: 15.3%
CARDS ISSUED: 140kRENEGOTIATIONS
28As of June 2020
1
2
3
4
5
6
INDUSTRY OVERVIEW: MACROECONOMY AND FINANCIAL SYSTEM
SANTANDER BRASIL PROFILE
CORPORATE STRATEGY
OUR BUSINESSES
OUR HIGHLIGHTS
APPENDICES
(R$ million) 6M20 6M19 % 12M 2Q20 1Q20 % 3M
Net Interest Income 26,275 23,300 12.8% 13,620 12,655 7.6%
Fees 8,584 9,152 -6.2% 4,102 4,482 -8.5%
Total Revenues 34,859 32,451 7.4% 17,722 17,138 3.4%
Allowance for Loan Losses -6,758 -5,964 13.3% -3,334 -3,424 -2.6%
General Expenses -10,483 -10,303 1.7% -5,191 -5,293 -1.9%
Others -5,997 -5,838 2.7% -3,142 -2,856 10.0%
Profit Before Taxes 11,621 10,346 12.3% 6,055 5,566 8.8%
Taxes and Minority Interest -3,872 -3,226 20.0% -2,159 -1,713 26.1%
Net Income w/o extraordinary provision 7,749 7,120 8.8% 3,896 3,853 1.1%
Extraordinary Allowance for Loan Losses -3,200 - - -3,200 - -
Taxes 1,440 - - 1,440 - -
Net Income 5,989 7,120 -15.9% 2,136 3,853 -44.6%
30
2Q20 RESULTS HIGHLIGHTS
RESULT
(R$ million) 6M20 % 12M % 3M
Customers 21,862 3.1% 1.8%
Product NII 20,909 5.4% 4.4%
Volume 377,755 20.4% 7.8%
Spread 11.1% -1.7 p.p -0.4 p.p
Working Capital 953 -29.5% -41.7%
Market activities 4,413 109.8% 42.1%
Net Interest Income 26,275 12.8% 7.6%
21,196 21,862
2,104 4,413
23,300
26,275
1H19 1H20
NIIGROWING IN CUSTOMERS AND MARKET ACTIVITIES
13%8%
CUSTOMERS NII
2Q20 RESULTS HIGHLIGHTS
13%
10,868 10,833 11,029
1,147 1,823 2,591
12,015 12,655
13,620
2Q19 1Q20 2Q20
NET INTEREST INCOME (R$ million)
MARKET NII
31
(R$ million) Jun/20 % 12M % 3M
Individuals 157,002 11.0% -0.2%
Consumer finance 56,732 6.7% -4.1%
SMEs 46,556 27.3% 5.6%
Corporate 122,587 41.8% 3.9%
Total 382,877 20.5% 1.2%
Other transactions1 83,872 9.6% -1.2%
Expanded portfolio 466,749 18.4% 0.7%
CREDIT PORTFOLIO (R$ billion)
¹ Includes debentures, FIDC, CRI, international distribution promissory notes, promissory notes, acquiring activity-related assets, as well as sureties and guarantees
PORTFOLIOHIGHLIGHTED BY CORPORATE AND SME LOANS
INDIVIDUALS COLLATERALIZED LOAN PORTFOLIO+
PAYROLL LOANS/ INDIVIDUALS LOAN PORTFOLIO
YoY QoQ+437bps+636bps
2Q20 RESULTS HIGHLIGHTS
21%1%
44.5% 41.6% 41.0%
16.7%15.6% 14.8%
27.2% 31.2% 32.0%
11.5% 11.7% 12.2%
317.6 378.5 382.9
Jun/19 Mar/20 Jun/20
Individuals Consumer finance
Corporate SMEs
DESTINATION OF
GOVERNMENT PROGRAMS
FOR SMEsBi
%
32
LOAN PAYMENT DEFERRAL
13% OF OUR TOTAL LOAN
PORTFOLIO
R$ 49.8PORTFOLIO
ACCOUNTS FOR
DEFERRAL PORTFOLIO PROFILE
83%OF CUSTOMERS WHO HAVE
JOINED THE PROGRAM EXTENDED
THEIR LOANS BY ONLY 60 DAYS
91%RATED AA-C
52% COLLATERALIZED
A D D R E S S I N G T H E NEEDS OF OUR CUSTOMERS
77%
23%
Individuals
Corporate & SMEs
33
57%
42%
1%
Mortgage
Consumer Finance/Vehicles
Others
(R$ million) Jun/20 % 12M % 3M
Demand deposits 39,497 92.5% 16.1%
Savings deposits 55,756 19.7% 11.1%
Time deposits 256,866 30.2% 19.6%
Financial Bills 22,443 -33.2% -20.7%
Others¹ 57,734 7.9% -0.7%
Funding from customers 432,294 23.0% 12.2%
- Reserve requirement -57,132 -23.7% 18.6%
Others 90,184 17.0% -1.5%
Total Funding - balance 465,347 31.6% 8.5%
Assets under management
(AuM)363,862 15.5% 4.7%
Total Funding + AuM 829,209 24.0% 6.8%
FUNDINGSTRONG INVESTMENT MOVEMENT
FUNDING FROM CUSTOMERS (R$ billion)
23% 12%
2Q20 RESULTS HIGHLIGHTS
351.5
385.4
432.3
Jun/19 Mar/20 Jun/20
1 Including debentures, real estate credit notes (LCI), agricultural credit notes (LCA), secured real estate notes (LIG) and structured transaction certificates (COE)34
(R$ million) 6M20 % 12M % 3M
Cards 2,632 -16.5% -12.1%
Current account 1,886 1.4% -0.2%
Insurance 1,464 -3.3% -4.6%
Asset management 478 -7.4% -10.0%
Lending operations 670 0.7% -15.5%
Collection services 718 -4.6% -8.7%
Securities brokerage and
placement 477 0.0% -15.8%
Others 258 20.8% -14.5%
Total 8,584 -6.2% -8.5%
FEESIMPACTED BY TRANSACTIONALITY IN THE PERIOD
FEES (R$ million)
2Q20 RESULTS HIGHLIGHTS
-11% -8% -6%
4,623 4,482
4,102
2Q19 1Q20 2Q20
9,152 8,584
1H19 1H20
35
FROM 15 TO 90 DAYS
5.8% 5.7%5.2%
6.0%
4.2%4.2% 4.1% 3.9% 4.1%
2.7%
1.9% 1.7% 1.9% 1.6% 1.1%
Jun/19 Sep/19 Dec/19 Mar/20 Jun/20
191% 194%
272%
Jun/19 Mar/20 Jun/20
LOAN PORTFOLIO QUALITY
NPL INDICATORS COVERAGE RATIO
OVER 90 DAYS OVER 90 DAYS
2Q20 RESULTS HIGHLIGHTS
CONTINUOUS FINE-TUNING OF OUR RISK MODELS
Individuals Total Corporate & SMEs
1.8% 1.5% 1.3%1.6%
1.2%
3.9% 4.1% 4.0% 4.0%3.5%
3.0% 3.0% 2.9% 3.0%2.4%
Jun/19 Sep/19 Dec/19 Mar/20 Jun/20
36
3.4% 3.2% 3.1%
6.0%
INDICATORS UNDER CONTROL TO FACE THE PRESENT SCENARIO2Q20 RESULTS
HIGHLIGHTS
3.3%3.2%4.7%
LOAN PORTFOLIO QUALITY
(590) (513) (711)
3,682 3,936 4,045
3,092 3,424
2Q19 1Q20 2Q20
(1,036) (1,223)
6,9997,981
5,964
1H19 1H20
3,200
3,200
9,958
6,534
Provisions for loan losses Recovery of written-off loans Cost of credit
ALLOWANCE FOR LOAN LOSSES (R$ million) | COST OF CREDIT
Cost of credit w/o extraordinary provision
37
38.1%37.2%
35.7%
2Q19 1Q20 2Q20
GENERAL EXPENSES (R$ million)
ADMINISTRATIVES AND PERSONNEL EXPENSES COMPOSITION (R$ million)
EFFICIENCY RATIO EVOLUTION
2Q20 RESULTS HIGHLIGHTS
0%-2%
2%
DILIGENT COST MANAGEMENT LEADS TO THE BEST EFFICIENCY RATIO IN OUR HISTORY
4,607 4,667 4,540
594 626 651
5,201 5,293 5,191
2Q19 1Q20 2Q20
9,130 9,207
1,1741,277
10,303 10,483
1H19 1H20
Personnel Expenses Administratives Expenses
4,467 4,621
4,663 4,585
9,130 9,207
1H19 1H20
2,314 2,308
2,353 2,232
4,667 4,540
1Q20 2Q20
Depreciation and amortization
Administratives and Personnel Expenses
1%-3%
38
90.4%98.2%
88.6%
Jun/19 Mar/20 Jun/20
LOAN PORTFOLIO/ FUNDING FROM CUSTOMERS
2Q20 RESULTS HIGHLIGHTS
BIS RATIO
BALANCE SHEET STRENGTH
16.2%
13.8%14.4%
14.0%
11.4%11.9%
Jun/19 Mar/20 Jun/20
BIS ratio CET1
39
INDICATORSEFFICIENCY RATIO
2Q20 RESULTS HIGHLIGHTS
RECURRENCE RATIO
38.1%37.2%
35.7%
2Q19 1Q20 2Q20
-2.4 pp
YoY
-9.9 pp
YoY
w/o extraordinary provision
1.8% 1.7% 1.6%
2Q19 1Q20 2Q20
-0.9 pp
YoY
ROAA ROAE
21.3% 22.3% 21.9%
2Q19 1Q20 2Q20
-9.3 pp
YoY12.0%0.9%
88.9% 84.7%79.0%
2Q19 1Q20 2Q20
40
1
2
3
4
5
6
INDUSTRY OVERVIEW: MACROECONOMY AND FINANCIAL SYSTEM
SANTANDER BRASIL PROFILE
CORPORATE STRATEGY
OUR BUSINESSES
FINANCIAL HIGHLIGHTS
APPENDICES
10.8%11.3% 11.5%
12.5%
Market Share in Turnover¹
CARDSTURNOVERR$ billion
GETNET
TRANSACTIONSmillion
MORTGAGES
LOAN TO VALUE
ORIGINATION BY DISTRIBUTION CHANNEL
TURNOVERR$ billion
TRANSACTIONSmillion
39.7 40.1 44.3 38.231.7
17.5 18.322.3
19.2
15.6
57.3 58.466.6
57.4
47.3
2Q19 3Q19 4Q19 1Q20 2Q20
Debit Credit
361.9 377.3 385.7 325.3 274.4
319.3 323.5 322.7292.1
266.7
681.2 700.8 708.4617.4
541.1
2Q19 3Q19 4Q19 1Q20 2Q20
Debit Credit
29.0 32.0 36.5 36.7 34.1
17.9 19.9
24.6 22.5 18.4
46.951.9
61.1 59.252.5
2Q19 3Q19 4Q19 1Q20 2Q20
Debit Credit
247.6 279.0 311.8 308.0 249.4
322.8353.7
418.2 375.4289.1
570.4632.7
730.0683.4
538.4
2Q19 3Q19 4Q19 1Q20 2Q20
Debit Credit
¹ Source: ABECS – Monitor Bandeiras
49% 49% 49% 50% 51%
62% 63% 63% 63% 68%
Jun-19 Sep-19 Dec-19 Mar-20 Jun-20
Origination (quartely average)
Loan Portfolio
60% 60% 61% 58% 51%
20% 13% 11% 8%10%
12%14% 17% 20% 28%
8% 13% 12% 14% 12%
2Q19 3Q19 4Q19 1Q20 2Q20
Digital Brokers Transfers to Homebuilders Branches
42
R E S E R V E R E Q U I R E M E N T
Type of DepositsAllocation
RateMandatory Allocation Remuneration
(maximum rates)Before 2008
Financial Crisis
During
the CrisisCurrent
Demand Deposit
Reserve Requirement 45% 42% 21% Cash deposit in Bacen -
Reserve Requirement - Additional 8% 5% 0% - -
Rural Loan 25% 30% 27.5% Allocate 27.5% for Rural Loan 8% p.a.
Microcredit 2% 2% 2% Allocate 2% for microcredit 4% p.m.
Free Funding 20% 21% 49.5%
Savings Deposit
Real Estate Financing 65% 65% 65% Allocate 65% for real estate financing TR +12%¹ p.a.
Reserve Requirement 20% 20% 20% Cash deposit in Bacen TR + 6.17% p.a. or 70%² of Selic
Reserve Requirement - Additional 10% 10% - Mandatory allocation was extinguished -
Free Funding 5% 5% 15%
Time Deposit
Reserve Requirement 15% 14% 17% Cash deposit in Bacen Selic
Reserve Requirement – Additional 8% 4% - Mandatory allocation was extinguished -
Free Funding 77% 82% 83%
1 Referring to the maximum effective cost regulated in Severance Indemnity Fund for Employees (FGTS) operations. 2 If the Selic rate target is equal or less than 8.5%, remuneration will be
TR (Brazilian Reference Rate) +70% of the current Selic Rate43
Our purpose is to help people and
businesses prosper
Investor Relations (Brazil)
Av. Presidente Juscelino Kubitschek, 2,235,
26th floor
São Paulo | SP | Brasil | 04543-011
Phone: 55 11 3553 3300
E-mails: ri@santander.com.br
acionistas@santander.com.br
Our culture is based on the belief that everything we do should be:
Simple | Personal | Fair
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