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Banco Santander (Brasil) S.A. BSBR

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You are paying about nine times earnings and roughly nine-tenths of book for the Brazilian arm of a Spanish parent that earns half the return its two largest local rivals do.

The whole setup turns on whether an 11% return on equity is a low point in the rate cycle or the ceiling of the franchise.

BSBR · price with moving averages

Daily · 6MWeekly · 3Y
$4$4$5$6$7 Sep '23Apr '24Nov '24Jun '25Jan '26Sep '26 BID
EMAs82140

Source: market data.

The business

The bank sells credit and payments to Brazilian households, small businesses and large corporates through branches, cards and a mobile app, and it funds that book with deposits. Two segments run the show: commercial banking, which is the retail and SME engine, and global wholesale banking, which does markets, advisory and structured lending for corporates. The money is made the ordinary way a bank makes it, borrowing short and lending long, then layering card fees, insurance and acquiring on top. Net interest income was R$57.6B in 2025 against gross interest income near R$162B, so most of the reported top line is funding cost that never belonged to shareholders. The moat is a distribution and deposit franchise built over four decades, real but not wide, and it competes against Itau and Banco do Brasil, who both earn far more on the same unit of equity.

Inside the complete Back of Napkin

  1. 01The business
  2. 02The numbers
  3. 03Management
  4. 04How it fails or surprises you
  5. 05The shape of the payoff
  6. 06Closing thoughts
  7. 07Methodology

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