Apparently in an effort to consolidate its just acquired title of biggest Brazilian private bank, a title that for decades belonged to Bradesco, Brazil's Banco Itaú, which accounts for 11% of retail banking in the country, announced that starting September 1st it will reduce all service charges collected on its MaxiContas current account packages.
In addition, the bank vows to eliminate various charges altogether thus providing more free services to its millions of customers. Itaú has also decided to hold the remaining personal current account charges at existing levels.
This decision, says the bank in a press release, should benefit all personal current account customers with reductions of as much as 12%, as well as other advantages arising from the elimination of other service charges.
"We have made this important decision, focused once again on innovation and the unceasing search for excellence in serving our customers. We were pioneers in this area in October 1996 when we created the MaxiConta, a service charges package benefiting those customers enjoying closer relationships with us. And, today I am very pleased to be able to announce that we have the most competitive and attractive package of banking services in Brazil," declares Roberto Setúbal, Banco Itaú's CEO.
These measures, according to the bank, will enable Itaú to further improve its relations with existing current account holders as well as expanding the customer base in a market where the penetration of banking services is on the increase, set against a scenario of economic growth and stability.
According to Itaú's CEO, these initiatives have been made possible thanks to the good quality of Itaú's management, always focused on efficiency and productivity. This model, he says, has allowed the Bank to continually pass on the benefits to its customers and create greater shareholder value.
"It is of fundamental importance to remember that these benefits reflect the prospects for economic growth which we are witnessing in Brazil, unquestionably leading us to an eventual investment grade rating. This scenario has already had an important impact on our results, contributing to the expansion of credit and the customer base," Setúbal adds.
Banks in Brazil have been accused of imposing heavy fees, charging extorsive interest rates and reaping obscene profits. Earlier this month, Itaú announced that it had a record net profit of 4.016 billion reais (US$ 2.06 billion) in the first semester, up 35.7% from the first half of last year.
According to Economática, a Brazilian financial market researching firm, this is the highest net profit of a private bank in the country in the last 20 years.
Bradesco, also announced net profit of 4.007 billion reais (US$ 2.06 billion) in the first half of the year.
Itaú credits its stellar performance on the sale of assets and on an increase in the bank's loan portfolio. Loans reached 104.8 billion reais (US$ 53.65 billion), in the first semester, up 40.2% from 74.8 billion reais (US$ 38.29 billion) in the same period last year.
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