EX-99.1 2 itub-ex991_7.htm EX-99.1

Exhibit 99.1

Announcement to the Market

Disclosure of results for the first quarter of 2020, according to International Financial

Reporting Standards – IFRS

We present below the differences between our financial statements in BRGAAP and in International

Financial Reporting Standards – IFRS.

As from January 1st, 2018, IFRS 9 came into effect, the accounting standard that replaces IAS 39 in the

treatment of Financial Instruments. The new standard is structured to encompass the pillars of

classification, measurement of financial assets and impairment and was applied retrospectively by Itaú

Unibanco Holding.

The complete consolidated financial statements under IFRS for the first quarter of 2020 are available at

our website: www.itau.com.br/investor-relations.

Comparison between BRGAAP1 and IFRS

R$ million

BRGAAPAdjustments and

Reclassifications

2IFRSBRGAAPAdjustments and

Reclassifications

2IFRSMar/31/2020Dec/31/2019Total Assets1,982,498 (134,396) 1,848,102 1,738,713 (101,232) 1,637,481

Cash, Compulsory Deposits and Financial Assets At Amortized Cost 3 4 61,350,019 (42,131) 1,307,888 1,164,753 3,535 1,168,288

(-) Provision for Expected Loss at Amortized Cost 5(46,240) 3,493 (42,747) (38,888) 2,859 (36,029)

Financial Assets at Fair Value Through Other Comprehensive Income 4165,603 (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 4389,955 (19,047) 370,908 345,677 (22,748) 322,929

Tax Assets 773,096 (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 Liabilities1,847,233 (142,648) 1,704,585 1,595,865 (107,849) 1,488,016

Financial Assets at Amortized Cost 3 61,476,139 (140,568) 1,335,571 1,265,471 (105,641) 1,159,830

Financial Assets at Fair Value Through Profit or Loss 488,079 220 88,299 48,008 21 48,029

Provision for Expected Loss (Loan Commitments and Financial Guarantees) 5944 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

Provisions20,217 - 20,217 21,454 - 21,454

Tax Liabilities 710,248 (4,347) 5,901 13,870 (5,979) 7,891

Other Liabilities40,493 (2,818) 37,675 28,887 (549) 28,338

Total Stockholders' Equity135,265 8,252 143,517 142,848 6,617 149,465

Non-controlling Interests11,641 2,068 13,709 10,861 1,679 12,540

Total Controlling Stockholders' Equity 8123,624 6,184 129,808 131,987 4,938 136,925

Balance Sheet

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

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

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

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

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

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

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

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

Below is the reconciliation of Results to Stockholders’ Equity, with the conceptual description of major adjustments.

R$ million

Stockholders

Equity *

Mar/31/20201st Q/204th Q/191st Q/19BRGAAP - Values Attributable to Controlling Stockholders123,624 3,401 7,482 6,710

(a) Expected Loss - Loan and Lease Operations and Other Financial Assets1,580 (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 Operations156 (37) (61) (36)

(f) Other adjustments2,758 379 (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

ReconciliationResult *

Differences between IFRS and BRGAAP Financial Statements9 More details in the Complete Financial Statements for the first quarter of 2020.

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

(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 30th,

2015, the consideration of these transactions are now recorded in result, in accordance with CMN Resolution No. 3,617/08.

For comparison purposes, we present on the table below the Result and Recurring Result in IFRS and BRGAAP.

R$ million

Recurring ResultBRGAAPIFRSVariationBRGAAPIFRSVariationResult - 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) - (167)

Mark to Market of Collateralized Securities (307) (307) - - - -

Others (18) (18) - - - -

Recurring Result - Attributable to Controlling Stockholders3,912 3,784 (128) 6,877 6,747 (130)

1st Q/191st Q/20

The tables in this report show the figures in million. Variations and summations, however, were calculated in units.

São Paulo, May 4th, 2020.

Alexsandro Broedel

Group Executive Finance Director and Head of Investor Relations