Nov 3 (Reuters) - XP Inc reported a jump in third-quarter adjusted profit on Wednesday, benefiting from the billions of reais the Brazilian brokerage attracted from investors seeking higher returns as the country’s economy falters.
Still, as Latin America’s largest economy undergoes a messy recovery from the pandemic’s impact, XP’s average daily trading volumes and assets under custody dropped from the previous quarter.
Inflation has shot up to more than 10%, the fastest since a political crisis five years ago, while unemployment remains close to record high levels. Last week, the country’s central bank raised interest rates by 150 basis points.
Chief Executive Officer Thiago Maffra said in a statement that despite a more challenging environment, XP is likely to post consistent growth in its key performance indicators due to a diversified product portfolio.
Founded in 2001 as an independent financial adviser, XP is the largest of a new breed of Brazilian digital brokers that has challenged the country’s top five banks, which hold a vast majority of assets in the sector.
The company’s assets under custody jumped 40% from a year earlier to 789 billion reais ($141.12 billion) in the third quarter.
Monthly average active client net additions rose to about 52,000 from 49,000 in the second quarter. Active client numbers rose 25% from a year earlier.
Net revenue jumped 51% to 3.171 billion reais.
Recurring net income surged 82% to 1.039 billion reais.
($1 = 5.5910 reais)
(Reporting by Noor Zainab Hussain in Bengaluru and Carolina Mandl in Sao Paulo; Editing by Devika Syamnath)
Source: Reuters