TO THE BRAZILIAN SOCIETY, EMPLOYEES, CONTRACTORS, INVESTORS AND CLIENTS

We are the Bank for All Brazilians. We operate in more than 99% of the country’s municipalities. In 87 editions held by the CAIXA Mais Brasil program, we traveled over 210 thousand kilometers across the country to understand the reality of our customers, whom we serve even in the most challenging and remote locations, offering differentiated conditions and improving our products and services to respond to the needs of the population.

We are the Inclusion Bank. We accessed 38 million “invisible” individuals who have now been included in the banking system. We carried out the largest hiring program for People with Disabilities in recent years, we value meritocracy and, in 2020, we promoted the highest number of women to executive positions and we are the Federal Government’s largest partner for the payment of recurring and emergency social benefits.
We are the Social Bank. We reduced interest rates by unprecedented amounts, innovated in housing products, and we are the bank who thinks about Micro and Small Businesses, promoting the country’s largest microfinance program through CAIXA TEM and our products and programs foster the economy and sustainable development.

We are the Numbers Bank. We achieved the best results in CAIXA’s history, even with record reductions in interest rates. We sold non-strategic assets, launched public offerings of shares of companies within our conglomerate, and signed partnership agreements that brought in billions in receivables to CAIXA.

During the first month of the current administration, we launched the CAIXA Mais Brasil program to get a better and more in-depth understanding of the population’s actual needs and become closer to our employees and contractors. Our journey began on January 18, 2019, in Roraima, and during 2020 we achieved a milestone of 87 weekends in which we traveled and worked throughout Brazil. We covered over 210 thousand kilometers, getting to know the reality of the country’s municipalities, particularly in the North and Northeast regions and countryside locations, experiencing CAIXA’s strength and the important role it plays with the Brazilian society.

We left our headquarters, talked to more than 25 thousand employees and looked into the eyes of over 30 thousand customers, all of which allows us to gain an overview of Brazil and all its regional characteristics and particularities. All the changes we made and continue to make are a result of these travels, which help us increase our sensitivity to better understand and perceive, in the local reality, what needs to be done to help the Brazilian population. We developed new products, new interest rates, new sponsorships and new programs, all of which are more aligned with the experiences of our clients, the Brazilian people.

Even amidst the Coronavirus pandemic in 2020, the CAIXA Mais Brasil program did not stop. If our front-line branch employees were required to maintain services available during this delicate moment of our history, why would the Bank’s senior management do otherwise? Just like our employees, we also adopted new sanitary measures and continued our efforts because stepping away from our employees and contractors was never an option.
When we began this project, in 2019, we knew that CAIXA needed to change the way it operated in order for us to get closer to the Brazilian society, including those in the most remote locations of the country. We now offer more facilities, better services and new products, expanding our customer base and reinforcing our motto of being the Bank for All Brazilians.

THE INCLUSION BANK

With our 160 years of existence, we remained side by side with all Brazilians during the historic year of 2020. We delivered emergency social benefits to millions of Brazilians in a quick and efficient way. We were responsible for operating the largest social and income transfer payment program in the history of Brazil, in which 611.55 million payments were made, totaling R$367.6 billion to 102.8 million people.

We structured this operation in record time, identifying 38 million individuals who were never registered with the government. These Brazilians went from being “invisible” to having free bank accounts through the CAIXA Tem application, therefore entering the banking system. Not only did these individuals gain visibility, but they also gained dignity and participation in the country’s productive economy.

The highlight of 2020 was, without a doubt, the execution of what was considered impossible: delivering Emergency Aid to all corners of the country, at a pace that met the needs of everyone depending on it, and we, once again, achieved this. In the middle of the pandemic, just five days after the enactment of the law, CAIXA was already delivering payments to 2.5 million Brazilians. Over the course of 20 days, this number reached 50 million people. Throughout 2020, we made 536 million payments to the beneficiaries of the Emergency Aid. To achieve this, we chose the most innovative and democratic path, creating a legacy of more than 107 million new digital bank accounts, of which 38 million were for people who never had a bank account in their lives.

The CAIXA Tem App promoted the largest social, digital, and financial inclusion movement in Brazil and is currently used to pay all social benefits. The App includes features for payment of bank slips, bills, a virtual debit card, and a QR Code to make purchases. Through millions of digital social savings accounts, CAIXA Tem has become the largest digital bank in the Western Hemisphere and will continue to offer its products and services to the population. From microfinancing to paying government benefits, the accounts that were opened will remain available and free of charge to our customers. These accounts are a legacy to the Brazilian people.

The FGTS Emergency Withdrawal was accessed by 60 million people, totaling R$37.7 billion in payments, of which R$36.5 billion were paid by the end of 2020. CAIXA also distributed R$16.4 billion in Emergency Benefit to Preserve Employment and Income (BEm).

In the People department, we hired over 3 thousand People with Disabilities, increasing by 150%2. This was the largest hiring of People with Disabilities made by us in recent years. We value meritocracy and created the Female Leadership program, promoting 14 women to the highest executive positions at the Bank – at the beginning of this administration, there were no women in vice president and director positions.

CAIXA’s Social and Environmental Responsibility Policy (PRSA) was revised and updated in 2020. It integrates the economic, social, and environmental dimensions into its business and relationships, incorporating socio-environmental responsibility in all its decisions. Since the creation of CAIXA’s Social and Environmental Fund (FSA), more than R$123 million have been invested in social and environmental projects and, in 2020 alone, over R$2.5 million were disbursed to 11 supported projects.

In October 2020, we launched measures to stimulate the economy and protect the environment. The CAIXA Refloresta program will promote, over the next 5 years, the planting of 10 million native trees across all Brazilian regions with the engagement of volunteer employees. We also reformulated our Selo Azul (Blue Seal), which aims to strengthen the CAIXA brand as a financial agent that fosters sustainable, innovative and socially-environmentally responsible production.

THE SOCIAL BANK

We accomplished several feats for the Brazilian population in 2020. This includes the reduction in interest rates and payments of social benefits to the possibility of making dreams come true by launching new housing credit lines. CAIXA offered the lowest rate for Mortgage Loans for Individuals in history, at a minimum rate of TR + 6.25% p.a. In addition to this modality, which was the only credit line available to meet demands of the Brazilian society until 2018, CAIXA launched a new IPCA mortgage line, with rates starting at 2.95% p.a. + IPCA and, in the fixed-rate modality, rates start at 8% p.a., in addition to allowing clients the possibility of hiring their mortgages through a digital platform on the Habitação CAIXA App. All this without mentioning that we are the Federal Government’s largest partner in the Casa Verde e Amarela Mortgage Program, where we play a fundamental role in improving people’s quality of life.

We also aimed at settling debts over 360 days overdue for a target audience of 3 million clients through the CAIXA Você no Azul Program, which granted discounts of up to 90% for settlements in cash. We settled overdue amounts for more than 300 thousand clients, totaling R$2.8 billion for individuals and companies. Still in this topic, we were pioneers in launching the temporary suspension of mortgage loan payments for individuals and commercial loans for companies. A total of 2.5 million contracts were put on hold, of which 99% of installments have been resumed.

In July 2020, we were pioneers in launching the Prepayment of the FGTS Birthday Withdrawal (Guarantee Fund for Time of Service), offering a credit line with reduced interest rates and without compromising the client’s monthly income, resulting in the hiring of R$4.8 billion in this new credit line for more than 859 thousand customers.
As part of our commitment to efficient resource management, we began donating more than 39,000 furniture items, materials and computers to thousands of philanthropic and welfare entities across the country, reinforcing our social role and fostering good practices.
We reached 25.9 million PIX keys registered, placing us in a relevant position in the PIX product, with a 19.34% market share of all PIX keys registered in the market3 – it is worth mentioning the strength of the CAIXA Tem channel, which originated 45% of these millions of PIX keys.

Micro, small and medium-sized companies were also supported by CAIXA during this period. We granted over R$41 billion in loans to more than 340,000 companies as of December 31, 2020, promoting employment and income during the pandemic. A total of R$15.6 billion was granted through 154,500 contracts for the National Program to Support Microenterprises and Small Businesses (PRONAMPE) in the period. We also granted over R$2.5 billion in loans for the Guarantee Fund for Micro and Small Enterprises (FAMPE), being the main financial institution operating in this modality.

We also supported companies in the health care sector, which have been fundamental during this period and needed special attention in 2020, by offering the CAIXA Hospitais credit line, aimed at philanthropic hospitals, in which we reduced interest rates by 71% in 2020 in relation to the previous rate, yet another example of our leading role during the pandemic scenario.

THE NUMBERS BANK

We are the largest bank in Latin America in number of customers (nearly 146 million4) and in loan balance (with a portfolio of R$787.4 billion), and we also have the third most valuable brand in the country5 (US$4.8 billion, 14.3% higher than in 2019), in a survey that analyzes business performance, equity, investments in marketing and is considered the most respected brand evaluation survey in the world. We are proud to say that our presence reaches over 99% of Brazilian municipalities, with over 26 thousand physical service points: 4.2 thousand branches and banking service points, 8.8 thousand exclusive banking correspondents, 13 thousand lottery units, 8 truck branches, and two floating branches.

We also strengthened CAIXA’s governance, meritocracy and efficiency. We immediately substituted 105 of the Bank’s 120 main executives and worked diligently to remove, still in 2019, the qualified audit opinions that were still pending for the balance sheet since 2016. In 2020, amidst all the challenges of the pandemic, CAIXA recorded a net income of R$13.2 billion, the second highest in its history, only lower than the R$21 billion reported in 2019.

As a reflection of the Bank’s efforts in strengthening its governance practices, in the first year of the current administration we achieved, for the first time, a score of 10 in the 3 parameters assessed by the Governance Indicator of the Coordination and Governance Secretary for State-owned Companies (IGSEST). With this result, we maintained our Level 1 Governance, consolidating the level of maturity already achieved in terms of corporate governance practices. We ended this biennium delivering even more safety and reliability. Our Basel ratio was 17.62%, 7.37 percentage points higher than the minimum requirement of 10.25% established by the National Monetary Council.

Focused on selling non-strategic assets and the public offering of shares of companies within our conglomerate, we carried out transactions that totaled R$85 billion from 2019 to 2020.

In addition to the sale of assets, we signed life insurance, pension plan and lender of last resort partnerships, resulting in receivables of R$7 billion to CAIXA.
We made decisions that would change the Bank’s course and directly impact society: we reduced the overdraft fee, from 13.55% to 1.89% per month and expanded our leadership in granting housing loans with funds from savings accounts, reaching a record of R$116 billion in loans granted and a loan portfolio of over R$510 billion in 2020.

From 2019 to 2020, our space optimization process returned 69 administrative spaces and another 110 spaces will be returned in 2021, representing, in the last biennium, savings of R$88.9 million in rent and administrative expenses. In line with this optimization and, aiming to bring tactical guidelines closer to operational execution, we allocated all Regional Superintendencies to buildings occupied by branches, including them in the daily lives of our clients in the region.

The CAIXA Lotteries, in turn, collected R$17.1 billion in 2020, the best result in its history, and we also paid the largest single lottery prize for the Mega da Virada (R$325.2 million). From the amounts collected in the period, nearly R$8.1 billion, or 47% of the total, was transferred to federal government social programs related to social security, sports, culture, public security, education and health.

Over the last two years, we guided CAIXA to where it should really be: side by side all Brazilians, as this is our mission. Headquarter units and managers went to the branch network to assist in services, see the reality and identify improvements that could be made. We managed to create a balance between making profit while serving the poorer population. We played a leading role in the financial and social transformation that had never been witnessed before and we are grateful to have been part of this since that is what makes CAIXA, before being a large Brazilian bank, the Bank for All Brazilians.

Pedro Duarte Guimarães
CEO of Caixa Econômica Federal
Brasília, December 31, 2020