Bradesco(BBDO) - 2019 Q4 - Annual Report

Risk Management - The banking portfolio's economic value is monitored through ∆EVE (Economic Value of Equity) and ∆NII (Net Interest Income) due to interest rate variations[96]. - Liquidity risk is managed on a group-wide basis with daily monitoring of available funds and compliance with liquidity levels according to the risk appetite established by the Board of Directors[98]. - The Short-Term Liquidity Ratio (LCR) has been used as a standard for internal management since October 2017, with structural long-term liquidity risk monitored through the NSFR since Q3 2018[99]. - Operational risk management includes identifying, evaluating, and monitoring operational risks, with a focus on new products and services to ensure compliance with regulations[101]. - The Integrated Risk Control Department is responsible for the independent validation of risk management and measurement models, ensuring adherence to regulatory requirements[102]. - Liquidity risk is evaluated and reported daily, with oversight from the Treasury Executive Committee and the Board of Directors[99]. - The company has established a contingency and recovery plan for potential high-stress situations related to liquidity risk[98]. - The Treasury Department aims to maximize results with available resources while managing risks, adhering to limits set by Senior Management[115]. Cybersecurity and Information Security - Continuous investments are made in cybersecurity measures, including server updates, intrusion detection systems, and employee training programs[104]. - The Corporate Security Department implements security solutions aligned with business objectives, focusing on information security and fraud prevention[106]. - The Security Operations Center (SOC) monitors the IT environment 24/7 and develops prevention measures against security incidents[111]. - The company has a state-of-the-art IT environment supported by a Data Center designed to ensure uninterrupted service availability[110]. - The company complies with the General Data Protection Law (LGPD), which establishes rules for the use and protection of personal data in Brazil[105]. Financial Performance - Total revenues from insurance premiums, pension plan contributions, and capitalization bond income reached R$77.7 billion in 2019[119]. - The banking segment reported revenue from financial intermediation of R$113.4 billion, an increase from R$110.6 billion in 2018[122]. - Net income for 2019 was R$15.2 billion, up from R$12.5 billion in 2018, representing a growth of 21.5$1.26 trillion, compared to R$1.25 trillion in 2018[122]. - The company had 72.0 million clients at the end of 2019, with a focus on financial inclusion and access to banking services[123]. - Loans increased to R$457.4 billion in 2019, up from R$411.5 billion in 2018, marking a growth of 11.1$366.2 billion, compared to R$340.7 billion in 2018, reflecting a growth of 7.5$400 million aimed at investing in startups with technology and innovative business models[117]. - The company launched a sales portal in November 2019 to enhance digital product offerings to non-account holders[129]. - The "Home Broker" service facilitated R$19 billion in trading in 2019, showcasing the company's digital trading capabilities[178]. - Digital loans authorized for individuals reached R$ 25.5 billion in 2019, up from R$17.4 billion in 2018, while loans for companies increased to R$ 30.1 billion from R$ 21.5 billion[208]. Corporate Governance and Compliance - The Integrity Program includes mechanisms to prevent and combat corruption, supported by the Board of Directors and the Integrity and Ethical Conduct Committee[114]. - Financial institutions must maintain internal compliance procedures to control their activities and ensure adherence to regulations[266]. - The company is required to publish annual consolidated financial statements prepared in accordance with IFRS, accompanied by independent auditors' reports, starting from January 1, 2022[278]. - The company is subject to independent audits every six months in accordance with BR GAAP, and quarterly financial information is also reviewed by independent auditors[278]. Social Responsibility and Sustainability - The company finished 2019 with significant advancements in ESG performance, recognized by stock exchange indices and specialized rating agencies, being included in the Dow Jones Sustainability Indices for the 14th time[275]. - The company made donations during the COVID-19 pandemic, including 5 million rapid tests, 15 million masks, and 30 CT scanners, while also supporting the construction of a campaign hospital in Rio de Janeiro with a capacity of 200 beds[275]. - The company is committed to sustainability through various initiatives, including the Global Compact Initiatives and the Principles for Responsible Banking, and became a signatory in 2019[275]. - The company has established a Sustainability and Diversity Committee that meets quarterly to oversee the sustainability strategy, which includes six operational pillars[275].