For their reputation for outstanding performances during the crisis, the Brazilian banks have earned the trust. With the resilience to financial crises because of capitalization level which are higher than the international average with strict controls and prudent regulations with the implementations of Basel guidelines. The characteristics seem to have developed since the late 1990s when the process of banking consolidation strongly decreased the number of financial institutions, modernized customer service and diversified products, services and approaches of payment with the severe use of technology as well as the merging of a nationally integrated payments system. The professionalization of bank administration has been complemented by the official improvement of the sector, which presently seeks to adjust its business models to the guidelines for shielding and sharing customer data and for environmental, social and corporate governance (ESG).
During the course of 2019, a new strategic placement for BRB was accepted by its regulatory shareholders, and a drive for the transformation and innovation arose to improve the bank´s ability to compete and carry superior service, providing a unique experience to both individual and corporate customers, and clearly impacting the economic and social development of the Federal District. This new strategy plan was custom made to make advances in the expansion of the business and to diversify the customer base. Also to expand digital relationships with customers, recommence the institution’s capacity to donate to the economic and social development of the region in accumulation of improving the governance and internal controls, snowballing operational efficiency, training staff and mostly changing the organizational structure.
The impact of Covid, necessitated many social isolation and banned economic activities while spreading fear significantly impacted BRB’s agendas. An effort to re organize the internal processes to enable the remote working teams with automated assistance. BRB also implemented government policies in Federal districts. A special credit program called Overcome Supera-DF in Portuguese was launched. This aimed at debt restructuring and offered the capital mainly to SMEs. 1, 50,000 families were served by the Federal District Government income transfer programs, which was also executed by the BRB. The registrations of eligible families were handled through mobile applications and electronic transfers of resources to debit cards that could be used in registered establishments digitally.
BRB’s presentation during the pandemic is echoed in figures presenting the expansion of its customer base by 25 percent and progress in its credit portfolio’s balance of 47.4 per cent. In return the share prices have increased, and the market capitalization of BRB has surpassed R$13.46 billion, a growth of 1,098 percent paralleled to the value of R$1.1 billion witnessed at the end of 2018.
On the future approach, The Brazilian Federation of Banks (FEBRABAN) pointed out that, since 2018, mobile banking (banking access via smartphone) has exceeded internet banking in account payments and transfers. On the other hand competition is also increasing in digital finances and its services provisions. The need for providing the financial products and services by the non-banking companies from the tech sector, lately called as fintechs has raised recently, especially after the pandemic struck and lockdown restrictions were high at stake.
In addition, Brazil’s regulatory environment has pursued to strengthen the competition between traditional financial institutions and fintechs with the depiction of Open Banking’s rules for data sharing.