Itaú Unibanco Holding S.A. Announcement to the Market

R$ million

BRGAAP

Adjustments and Reclassifications ²

BRGAAP

Adjustments and Reclassifications ²

IFRS

Dec/31/2020

Dec/31/2019

Total Assets

2,112,586

(93,334)

2,019,252

1,738,713

(101,232)

1,637,481

Cash, Compulsory Deposits and Financial Assets At Amortized Cost ^{3 4 6}

1,381,449

(12,375)

1,369,074

1,164,753

3,535

1,168,288

(-) Provision for Expected Loss at Amortized Cost ⁵

(51,404)

4,353

(47,051)

(38,888)

2,859

(36,029)

Financial Assets at Fair Value Through Other Comprehensive Income ⁴

209,636

(99,601)

110,035

166,676

(89,930)

76,746

(-) Expected Loss at Fair Value Through Other Comprehensive Income ⁵

(4,149)

4,056

(93)

(3,162)

3,076

(86)

Financial Assets at Fair Value Through Profit or Loss ⁴

457,739

7,842

465,581

345,677

(22,748)

322,929

Tax Assets ⁷

73,792

(7,148)

66,644

56,835

(7,875)

48,960

Investments in Associates and Joint Ventures, Goodwill, Fixed Assets, Intangible Assets, Assets Held for Sale and Other Assets

45,521

9,541

55,062

46,822

9,851

56,673

Total Liabilities

1,964,880

(100,153)

1,864,727

1,595,865

(107,849)

1,488,016

Financial Assets at Amortized Cost ^{3 6}

1,595,816

(100,175)

1,495,641

1,265,471

(105,641)

1,159,830

Financial Assets at Fair Value Through Profit or Loss ⁴

79,742

(89)

79,653

48,008

21

48,029

Provision for Expected Loss (Loan Commitments and Financial Guarantees) ⁵

840

3,552

4,392

959

3,181

4,140

Provision for Insurance and Pension Plan

220,004

996

221,000

217,216

1,118

218,334

Provisions

19,819

-

19,819

21,454

-

21,454

Tax Liabilities ⁷

9,633

(3,922)

5,711

13,870

(5,979)

7,891

Other Liabilities

39,025

(514)

38,511

28,887

(549)

28,338

Total Stockholders' Equity

147,706

6,819

154,525

142,848

6,617

149,465

Non-controlling Interests

11,113

419

11,532

10,861

1,679

12,540

Total Controlling Stockholders' Equity ⁸

136,593

6,400

142,993

131,987

4,938

136,925

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.

R$ million

Stockholders Equity *

Dec/31/2020

4th Q/20

3rd Q/20

4th Q/19

 jan-dec/20

 jan-dec/19

 BRGAAP - Values Attributable to Controlling Stockholders

136,593

7,592

4,492

7,482

18,909

26,583

(a) Expected Loss - Loan and Lease Operations and Other Financial Assets

2,466

612

25

1,569

750

(b) Adjustment to Fair Value of Financial Assets

669

(8)

(250)

278

(239)

(c) Acquisition of Interest in Porto Seguro Itaú Unibanco Participações S.A.

435

(1)

(1)

(1)

(4)

(4)

(d) Criteria  for Write-Off of Financial Assets

1,935

13

(49)

(36)

8

(289)

(e) Financial Lease Operations

87

(12)

(25)

(61)

(106)

(172)

(f) Other adjustments

2,541

109

298

(29)

(939)

56

IFRS - Values Attributable to Controlling Stockholders

142,993

8,982

4,732

8,674

18,896

27,113

IFRS - Values Attributable to Minority Stockholders

11,532

(792)

367

41

(3,832)

700

IFRS - Values Attributable to Controlling Stockholders and Minority Stockholders

8,190

5,099

8,715

15,064

27,813

* Events net of tax effects

Differences between IFRS and BRGAAP Financial Statements  

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

(f) Other Adjustments is mainly due to the impairment of goodwill and intangible assets of Itaú Corpbanca in the 2nd Q/20 and reversal of the Amortization of Goodwill under BRGAAP.

⁹ More details in the Complete Financial Statements for January to December, 2020.

4th Q/20

4th Q/19

BRGAAP

IFRS

Variação

BRGAAP

IFRS

Variação

Result - Attributable to Controlling Stockholders

7,592

8,982

1,390

7,482

8,674

1,192

2,204

2,592

389

186

2,240

2,054

Gain on the the partial sale of  XP Inc shares

3,193

3,263

70

-

-

-

Provision for restructuring

(220)

(220)

-

-

-

-

Mark to market of collateralized securities

(379)

(379)

-

-

-

-

Goodwill amortization

(179)

-

179

(155)

6

161

Liability adequacy test

10

150

140

9

66

57

Gain due to the primary issuance of XP Investimentos shares

-

-

-

1,974

1,974

-

Impairment, mainly related to technology

(92)

(92)

-

(37)

(37)

-

Revaluation of the tax credit balance

-

-

-

2,303

2,024

(279)

Civil, fiscal and labor contingencies

-

-

-

(1,307)

(1,307)

-

Constitution of provision for loan losses

-

-

-

(2,453)

(338)

2,115

Other

(128)

(128)

-

(148)

(148)

-

Recurring Result - Attributable to Controlling Stockholders

6,390

7,296

6,434