Itaú Unibanco Earnings: Decent Net Interest Income and Improving Credit Costs Drive Strong Results

No-moat-rated Itaú Unibanco reported solid first-quarter earnings that were largely in line with our expectations. The bank's operating revenue increased 7.8% from last year but fell 1.5% from last quarter to BRL 40.4 billion. Meanwhile, recurring managerial results increased 15.8% from last year to 9.8%, which translates to a return on equity of 21.9%. As we incorporate these results, we do plan to materially alter our $6.30 per ADR share fair value estimate, and we see the shares as roughly fairly valued.