SAO PAULO (Reuters) - Brazil’s Banco Bradesco SA is studying the possible closure of up to 200 branches this year in an ongoing review of its network, the bank’s new chief executive officer, Octavio Lazari, said in an interview on Tuesday.
The bank now has a network of nearly 4,750 branches.
Following the $5.2 billion acquisition of HSBC Holdings Plc’s 800 Brazilian branches in 2016, Bradesco reviewed its footprint and closed around 565 branches last year.
After realizing major cost savings from that acquisition, Bradesco is focused on using the integrated operations to boost revenue, said Lazari. He spoke on his first day in charge following a shareholder assembly on Monday.
“A big part of the revenue increase will come from selling more products per client,” he told Reuters in an interview at Bradesco’s headquarters in the Sao Paulo suburb of Osasco.
Bradesco aims to raise the average number of products sold to each client to two by year end, from 1.6 currently, Lazari said. He added that the bank has been using advanced data analytics to identify which products should be offered to its 30 million clients.
The ascent of Lazari, 54, who was named in February to replace former CEO Luiz Carlos Trabuco Cappi, who has taken over as chairman, marks a generational sea change at Bradesco. Former Chairman Lázaro Brandão, 91, stepped down in October.
Lazari said Bradesco is focused on expanding digital services not only with its online bank Next, which it launched in late October in an appeal to younger clients, but also by working with financial technology startups, known as fintechs.
Lazari said Next has already reached 80,000 clients.
Although fintechs represent potential competition for Bradesco’s products and services, Lazari said partnering with them could help to retain clients of all ages.
He said the bank’s 2018 budget forecasts return on equity in line with last year’s performance of about 18 percent, which ranked lower than larger rival Itau Unibanco’s.
“We have made a strong bet in Brazil that has not yet paid off,” Lazari said. “But it will pay off, I’m sure.”
Lazari says Bradesco “will learn, along with other Brazilian banks” to be profitable with the country’s record-low interest rates, which he said are likely to remain low in the medium term. “We are not expecting rates to come back to high levels.”
Bradesco shares slipped 1.4 percent on Tuesday, in line with Brazilian peers.
Reporting by Carolina Mandl and Tatiana Bautzer; Additional reporting by Daniel Flynn; Editing by Brad Haynes and Matthew Lewis