Bradesco is the third largest bank in Brazil. Unlike most developed countries, where small banks and credit unions are always present, in Brazil the banking industry has a well-established oligopoly, in which the 4 main banks together concentrate around 70% of the market share. This oligopoly, along with the high switching costs in the banking industry, gives these 4 banks a good pricing advantage.
The banking industry in Brazil is also conservatively regulated and highly profitable, with spreads above 10%. These two factors considerably reduce the risk for small investors in these banks.
Bradesco has more than 800 billion dollars in assets and an ROE close to 20%. Its two main segments are banking and insurance, each contributing almost equally to the company’s bottom line.
With 4,600 branches across the country, Bradesco is the only one of the major banks that is present in every city in Brazil. This strong presence will allow Bradesco to benefit from Brazil’s growth in the coming decades.
Bradesco’s competitive advantage is based on its presence, brand, scale, high switching costs, and the oligopoly in the industry. These factors, together with exposure to a fast-growing market, give Bradesco the highest EBI rating: 5 stars.
Banco Bradesco S.A.
| ADR Ticker | BBD |
| Bovespa Ticker | BBDC3, BBDC4 |
| Latibex Ticker | XBBDC |
| Website | http://www.bradescori.com.br/site/conteudo/home/default.aspx?idiomaId=2 |
| Industry* | Banks, Insurance |
| EBI Rating |  |
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