Itaú Unibanco expects delinquency levels to remain broadly stable in the coming quarters and has not altered its approach to credit risk, chief executive Milton Maluhy Filho said after the bank released first-quarter earnings.

“We do not foresee any disruption in the credit cycle in our portfolio, and our expectation for the coming quarters is for relative stability in the (default) indicators,” Maluhy Filho told reporters.

Loans overdue by more than 90 days stood at 1.9% in the quarter, unchanged from both the previous quarter and a year earlier. The ratio for loans between 15 and 90 days overdue was 1.7%, versus 1.6% in the fourth quarter and 1.8% a year before, Reuters reported.

The executive said micro, small and medium-sized business lending could face a rise of 10 to 20 basis points in delinquency levels after government programmes reduced grace periods. “But these are very protected portfolios... we don't see any significant increase in expected losses,” he said.

Maluhy Filho added that the bank continues to monitor large corporate borrowers, though provisions already reflect known market events. He said Itaú’s lending strategy remains focused on segments with expanding relationships and profitability.

During a call with analysts, he said the bank’s guidance points to return on equity above 20%. “We will continue to deliver significant profitability over the next few quarters,” he stated. Itaú’s consolidated ROE reached 24.8% in the first quarter.