Announcement to the Market - Disclosure of results for the first quarter of 2020, according to International Financial Reporting Standards - IFRS

BRGAAP

Adjustments and Reclassifications

²

BRGAAP

Adjustments and Reclassifications

 ²

Mar/31/2020

Dec/31/2019

Total Assets

1,982,498

(134,396)

1,848,102

1,738,713

(101,232)

1,637,481

Cash, Compulsory Deposits and Financial Assets At Amortized Cost ^{3 4 6}

1,350,019

(42,131)

1,307,888

1,164,753

3,535

1,168,288

(-) Provision for Expected Loss at Amortized Cost⁵

(46,240)

3,493

(42,747)

(38,888)

2,859

(36,029)

Financial Assets at Fair Value Through Other Comprehensive Income ⁴

165,603

(81,534)

84,069

166,676

(89,930)

76,746

(-) Expected Loss at Fair Value Through Other Comprehensive Income ⁵

(2,942)

2,809

(133)

(3,162)

3,076

(86)

Financial Assets at Fair Value Through Profit or Loss ⁴

389,955

(19,047)

370,908

345,677

(22,748)

322,929

Tax Assets⁷

73,096

(7,119)

65,977

56,835

(7,875)

48,960

Investments in Associates and Joint Ventures, Goodwill, Fixed Assets, Intangible Assets, Assets Held for Sale and Other Assets 

53,007

9,133

62,140

46,822

9,851

56,673

Total Liabilities

1,847,233

(142,648)

1,704,585

1,595,865

(107,849)

1,488,016

Financial Assets at Amortized Cost ^{3 6}

1,476,139

(140,568)

1,335,571

1,265,471

(105,641)

1,159,830

Financial Assets at Fair Value Through Profit or Loss ⁴

88,079

220

88,299

48,008

21

48,029

Provision for Expected Loss (Loan Commitments and Financial Guarantees) ⁵

944

3,747

4,691

959

3,181

4,140

Provision for Insurance and Pension Plan 

211,113

1,118

212,231

217,216

1,118

218,334

Provisions

20,217

-

20,217

21,454

-

21,454

Tax Liabilities ⁷

10,248

(4,347)

5,901

13,870

(5,979)

7,891

Other Liabilities

40,493

(2,818)

37,675

28,887

(549)

28,338

Total Stockholders' Equity

135,265

8,252

143,517

142,848

6,617

149,465

Non-controlling Interests

11,641

2,068

13,709

10,861

1,679

12,540

123,624

6,184

129,808

131,987

4,938

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

²Resulted from reclassification of assets and liabilities and other effects from the adoption of IFRS;

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

⁴Refer to reclassification of financial assets between measurement categories at fair value and amortized cost;

⁵Application of criterion for calculation of Expected Loss as set forth by IFRS;

⁶Difference in accounting, particularly from Foreign Exchange Portfolio, which are now be presented as net effect between Assets and Liabilities;

⁷Difference in accounting, particularly deffered taxes, which are now accounted for as net effect between Assets and Liabilities in each one of the consolidated companies;

⁸Reconciliation of Controlling Stockholders' Equity is presented in the following table. 

Stockholders

Equity *

 1st Q/20 

 4th Q/19 

 1st Q/19 

 BRGAAP - Values Attributable to Controlling Stockholders 

123,624

3,401

7,482

6,710

(a)Expected Loss - Loan and Lease Operations and Other Financial Assets

1,580

(136)

1,569

(74)

(b)Adjustment to Fair Value of Financial Assets

(654)

(126)

(250)

125

(c)Acquisition of Interest in Porto Seguro Itaú Unibanco Participações S.A.

438

(1)

(1)

(1)

(d)Criteria  for Write-Off of Financial Assets 

1,906

(21)

(36)

(39)

(e)Financial Lease Operations

156

(37)

(61)

(36)

(f) Other adjustments

2,758

379

(29)

62

IFRS - Values Attributable to Controlling Stockholders 

129,808

3,459

8,674

6,747

IFRS - Values Attributable to Minority Stockholders 

13,709

219

41

156

IFRS - Values Attributable to Controlling Stockholders and Minority Stockholders 

143,517

3,678

8,715

6,903

* Events net of tax effects

Differences between IFRS and BRGAAP Financial Statements

(a)In the adoption of IFRS 9, there was a change in the calculation model of incurred loss (IAS 39) to expected loss, considering forward-looking information. On BRGAAP, the concept of Expected Loss is used, pursuant to BACEN Resolution No. 2,682/99.⁹

(b) Under IFRS, stocks and quotas classified as permanent investments were measured at fair value and its gains and losses were recorded directly in Result. Additionally, there was a change in the model of classification and measurement of financial assets due to the new categories introduced by IFRS 9.

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

(d) Criterion for write-off of financial assets on IFRS considers the recovery expectative. 

(e) Under IFRS (IAS 17) the financial lease operations are recorded as Fixed Assets,  as a contra-entry of Other Financial Liabilities. Under BRGAAP, as from September 30^th,  2015, the consideration of these transactions are now recorded in result, in accordance with CMN Resolution No. 3,617/08.

(f) Other Adjustments is mainly composed of reversal of Amortizations of Goodwill under  BRGAAP.

⁹More details in the Complete Financial Statements for the first quarter of 2020.

IFRS

Variation

BRGAAP

IFRS

Result - Attributable to Controlling Stockholders

3,401

3,459

58

6,710

6,747

37

Exclusion of the Non-Recurring Events

(510)

(324)

(186)

(167)

-

(167)

Goodwill Amortization

(186)

-

(186)

-

(167)

Mark to Market of Collateralized Securities 

(307)

(307)

-

-

-

-

Others

(18)

(18)

-

-

-

-

Recurring Result - Attributable to Controlling Stockholders

3,912

3,784

(128)

6,877

6,747

(130)