Itau Unibanco Of Brazil To Shut Down 400 Branches
Zacks Investment Research | May 14, 2019 07:42AM ET
As a large number of financial transactions shift to digital platforms, Brazil-based Itau Unibanco Holding S.A. (NYSE:ITUB) plans to close 400 branches in the country over the next two years, reported Reuters.
According to the source, the transition is likely to take place in two phases. In the first phase, the bank may close 200 branches over the next 12 months. In the second phase the remaining branches will be closed in the following year. Though the bank has not commented on the target number, it stated "the reduction of brick-and-mortar branches is a trend to adapt to the needs of clients and demand for digital services."
Some employees of these branches could be absorbed by 195 existing digital branches of the bank as of Mar 31, 2019.
Notably, Itau Unibanco recently announced that it will launch a digital wallet with no fee called Iti and all banking transactions will be made online.
Our Viewpoint
The digital-based financial services platforms, supported by the Central Bank, have developed in recent years, providing growth opportunities to large banks in areas such as consumer loans and payment facilities. Therefore, Itau Unibanco’s restructuring efforts will likely support its long-term growth. Nevertheless, heightening competition, flaring up expenses and stressed conditions in the Brazilian economy pose significant risks.
Shares of Itau Unibanco have lost 18.7% over the past three months compared with 1.9% decline registered by the Zacks Investment Research
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.