Itau Unibanco Holding SA ADR ITUB

Itaú Unibanco Is in a Strong Position as Inflation Moderates

Itaú Unibanco has positioned itself as a regional money center in Latin America, with operations across Chile, Uruguay, Paraguay, Colombia, and Argentina. We have mixed feelings about this approach as the bank's home market Brazilian operation consistently provides better returns than its international business. That said, the strategy does allow it to diversify its asset growth and simultaneously reduce its exposure to the notoriously volatile Brazilian real, so there are tangible benefits to the approach. Itaú has faced a more hostile approach from regulators in recent years, with the central bank working to increase competition through the successful Pix payment system and support for the open banking movement. That said, these shifts have had more impact on Itaú's rivals, with the bank's profitability remaining strong despite new competitive forces in the Brazilian market.