Itaú Unibanco Holding S.A. - MATERIAL FACT - Payment of interest on capital

Rhea-AI Summary

ITAÚ UNIBANCO HOLDING S.A. approves payment of interest on capital to stockholders at a rate of R$ 0.2418 per share, with net interest of R$ 0.20553 per share. The payment will be made until August 31, 2024, based on the final stockholding position recorded on March 21, 2024.

Insights

Financial Analyst

The announcement by ITAÚ UNIBANCO HOLDING S.A. regarding the payment of interest on capital (IOC) to stockholders is a significant financial event that should be closely scrutinized by investors. The payment of R$ 0.2418 per share, with a 15% income tax withholding, reflects a direct return to shareholders and impacts the distributable earnings of the bank. The timing and size of such payments can influence investor sentiment and stock liquidity, as they often signal the company's cash flow stability and profitability.

It is crucial to consider the historical trends of IOC payments by Itaú Unibanco and compare them with industry benchmarks. A consistent track record of IOC payments could imply robust financial health, whereas deviations might indicate changes in the company's capital allocation strategy or underlying financial conditions. Investors should also factor in the potential tax implications and the net receivable amount, which is R$ 0.20553 per share after taxes.

Moreover, the declared IOC could affect the stock's ex-dividend price adjustment on March 22, 2024. Typically, a stock price might drop by an amount roughly equivalent to the dividend (or IOC in this case) payment on the ex-date, reflecting the reduction in the company's assets due to the payout. This is a key consideration for strategies involving dividend capture or for investors evaluating entry and exit points.

Market Research Analyst

The announcement from ITAÚ UNIBANCO HOLDING S.A. can be seen as an indicator of the bank's strategic priorities, particularly in terms of shareholder value distribution. The provision of IOC is a common practice in Brazilian markets, often preferred over dividends due to tax advantages for both the company and investors. It is essential to analyze the competitive landscape, where such payouts can influence the attractiveness of ITAÚ UNIBANCO's shares relative to its peers.

Investor relations strategies, such as the one employed by Itaú Unibanco, aim to maintain transparent communication with shareholders and can be instrumental in managing market expectations. The bank's approach to capital distribution should be evaluated within the broader context of its financial performance, including return on equity (ROE), earnings growth and risk management practices.

Understanding the sector-specific implications of such payments, including regulatory constraints and the macroeconomic environment, is also vital. For instance, the Central Bank of Brazil's monetary policy and regulatory requirements could influence the bank's capital adequacy and, consequently, its capacity for IOC payments.

Tax Advisor

The tax implications of the interest on capital payment announced by ITAÚ UNIBANCO HOLDING S.A. warrant careful consideration. The 15% withholding tax rate on IOC payments is a critical aspect for individual investors, as it affects the net income they receive. Corporate stockholders, who can prove immunity or exemption from such withholding, stand to benefit differently, highlighting the importance of tax planning in investment decisions.

Investors should be aware of the Brazilian tax code's nuances concerning IOC and how it interacts with other forms of investment income. The distinction between IOC and dividends, for example, is particularly relevant in Brazil, where dividends are typically exempt from income tax, whereas IOC is not. However, IOC can be deductible for the company, which may result in a lower overall tax burden and thus influence the company's preference for this form of shareholder remuneration.

It is essential to assess the after-tax return on investment, considering the IOC payment in conjunction with the investor's overall tax situation. This can affect the effective yield on the shares and should be factored into the investment analysis and portfolio strategy.

SÃO PAULO, March 4, 2024 /PRNewswire/ -- ITAÚ UNIBANCO HOLDING S.A. informs its stockholders that its Board of Directors has approved, at the meeting held on this date, the payment of interest on capital to stockholders, in the amount of R$ 0.2418 per share, with income tax withholding at a rate of 15%, resulting in net interest of R$ 0.20553 per share, except for the corporate stockholders able to prove that they are immune or exempt from such withholding, which will be made until August 31, 2024, as usually done by the Company, based on the final stockholding position recorded on March 21, 2024, with their shares traded ex-rights starting March 22, 2024. 

For further information, please visit on www.itau.com.br/investor-relations as follows: Contact IR > IR Service.

São Paulo (SP), March 4, 2024.

RENATO LULIA JACOB 
Group Head of Investor Relations and Market Intelligence

Note: The amounts paid per share as interest on capital are the same for common (ITUB3) and preferred (ITUB4) shares.

Contact:
Itaú Unibanco – Comunicação Corporativa
Phone: (11) 5019-8880 / 8881
E-mail: imprensa@itau-unibanco.com.br

View original content:https://www.prnewswire.com/news-releases/itau-unibanco-holding-sa---material-fact---payment-of-interest-on-capital-302079056.html

SOURCE Itaú Unibanco Holding S.A.

FAQ

What is the amount of interest on capital approved per share for ITUB stockholders?

ITAÚ UNIBANCO HOLDING S.A. has approved the payment of R$ 0.2418 per share as interest on capital.

When will the payment of interest on capital be made to ITUB stockholders?

The payment will be made until August 31, 2024, based on the final stockholding position recorded on March 21, 2024.

What is the net interest per share for ITUB stockholders after income tax withholding?

After income tax withholding at a rate of 15%, the net interest per share is R$ 0.20553.

Where can stockholders find further information about the payment of interest on capital by ITAÚ UNIBANCO HOLDING S.A.?

Stockholders can visit www.itau.com.br/investor-relations for more information or contact IR Service.

What is the contact information for Itaú Unibanco's Corporate Communication?

Itaú Unibanco's Corporate Communication can be reached at (11) 5019-8880 / 8881 or via email at imprensa@itau-unibanco.com.br.