Good morning, ladies and gentlemen. Thank you for standing by, welcome to Itaúsa's conference call to discuss first half of 2020 results. At this time, all participants are in listen only mode. Later, we will conduct a Q&A session, and instructions to participate will be given at that time. Should you require assistance during this call, please press star key followed by zero. As a reminder, this conference is being recorded. The file will be available at the company's website at www.itausa.com.br/en at the Investor Relations section. This conference call and slide presentation are being transmitted via internet as well. You can access the webcast by logging on the company's website www.itausa.com.br/en. Before proceeding, let me mention that forward-looking statements are being made under the safe harbor of the Securities Litigation Reform Act of 1996.
Actual performance could differ materially from that anticipated in any forward-looking comments as a result of macroeconomic conditions, market risks and other factors. I inform that during the presentation, the questions can be sent by webcast, and it will be answered at the section of Q&A. With us here today, we have Mr. Alfredo Egydio Setubal, CEO and Investor Relations Officer at Itaúsa. Mr. Henri Penchas, Chairman of the Board of Directors at Itaúsa. Mr. Priscila Grecco Toledo, CFO at Itaúsa. Mr. Bruno Salém Brasil, Investor Relations Manager at Itaúsa. Mr. Renato Lulia Jacob, Head of IR and Market Intelligence at Itaú Unibanco. Mr. Carlos Biel, Investor Relations Manager at Alpargatas. Mr. Natasha Utescher, Investor Relations Coordinator at Duratex. It's now my pleasure to turn the conference over to Mr. Alfredo. Sir, you may begin now. Ladies and gentlemen, please hold.
Hello?
Mr. Alfredo, you may proceed now.
Yes. Okay, thank you. Hello? Everybody is listening? I will start.
Yes, you can proceed. Mr. Alfredo, you may proceed now.
Hello?
Yes, we can hear you. You may begin.
Hello?
Mr. Alfredo, you may proceed.
Okay, I'm restarting, please. Thank you. Sorry for the connection problem. We are starting from our conference call for the first semester results for Itaúsa. That's our agenda for today. We will pass through quickly from the slides, then we open for Q&A section. Going to the next slide, please. We are in slide number four about COVID reactions in our operations for our companies. Of course, all the companies suffered, especially at the beginning of the crisis, sanitary and socioeconomic here in Brazil. The bank had to make the central bank approve some measures to facilitate the banks for renegotiations of credits. We did millions of renegotiations for individuals and medium companies, especially small ones. We are passing this moment with many millions of renegotiations in credits for individuals and companies.
Let's see what will happen when these renegotiations stop, we have to go back to the normality of the situation. At the same time, we have increase in loans in the portfolio, especially at the beginning, especially for big companies that use their credit lines to increase cash to face the pandemic, and medium-sized companies also. The bank, in the first semester, made additional provisions for about BRL 9 billion in terms of credit above the minimum required for the central bank in the policy of the expected provisions policy that we have in terms of loan losses. Let's see how the economy and how the credit performs in the next quarters to see how much is more necessary to complement this level of provisions. As you know, the central bank imposed restrictions for the distribution of dividends and interest over capital.
We have a limitation in our statutory bylaws. The bank can only distribute this year 25% of the results as dividends or interest in capital. That, of course, will impact the inflow of Itaúsa in terms of dividends that we are going to receive. Alpargatas also had problems at the beginning. We had huge reduction in production. We adjust the production in the beginning. We have also a term extension for clients. We made a provision for losses from the company in terms of our clients, especially in terms of distributors. To face all these factors at the beginning, we raised BRL 2.1 billion in cash from the bank using the disposable lines that the company has in the banks. Today, the situation is much better. The company increased productions in May, in June, and also in July.
We are operating at full capacity now back due to the better conditions in the local market and also because of exports that are in a very good pace, especially for Havaianas. I think in the case of Alpargatas, most of the problems are gone and we are going back to normal activity in this third quarter. In the case of Duratex, also we had a huge impact at the beginning. We practically closed all the factories in the end of March, beginning of April. We also had to renegotiate each time for extension for the clients in our supply chains. We also made provisions around BRL 25 million for the possible losses. The company also increased liquidity at the beginning in BRL 1.6 billion to face the crisis. Also Duratex restarts the production back in the middle of April.
All the chain of distribution of Duratex products remained open during all the periods. All the material companies remain open. Someone is with the microphone open. Please shut down, please. Duratex increased their production in April and May, in June and July. We operate full in July, probably full for this quarter. The case of Duratex and Alpargatas, I think most of the problems are gone and we are back to normal activity for the moment. What is good news, probably both of the companies are reducing the loans that we raised to face the pandemic crisis. I think the situation today is much better than we were expecting during the first days, the first weeks of the economic situation, the economic crisis in the beginning.
Yes, we had also to grant a temporary deferral for Petrobras that is returning to normal pace now, and we also postponed some investment that we were doing during this period. We can move to the next slide, where we can see how the companies that we participate and how Itaú itself made support for the crisis. Itaú opened a line through our Foundation for culture and social benefits for the Brazilian society in BRL 1 billion in a new line, in a donation for the Foundation. We also received more than BRL 250 million from donations from other companies, individuals, and especially from the Moreira Salles family, that is, the family that with Itaúsa controls the bank. It is only through the bank, BRL 1.35 billion in donation for support, especially hospitals, public hospitals, in the combat of the COVID-19.
Duratex also made donations, also for the Fundação Itaú Social and products from our line of products, especially for the new hospitals that were made to support the public service during this period. Alpargatas also made donations of BRL 16.5 million, including also a donation for the Fundação Itaú Social of BRL 5 million, and many products and masks and uniforms for hospital attendants and serological tests, respirators, shoes for medical, plastic shoes. We adapt our fabrics to support the support that we gave for the public hospitals. NTS also BRL 4.1 million in donations and equipment for the hospitals. Itaúsa itself donates BRL 550 million for the project Todos pela Saúde. That is the initiative of the foundation of the bank. Also these two families, Setúbal and Villela, also made donations of BRL 50 million for the foundation of Itaú Unibanco.
I think all the companies and all the families are helping the country and the public health system to support the pandemic that in Brazil is taking a long time, in terms of decline of this, consider the phase 1. Going to the next slide, we are going to see now more things related to our governance, ESG practices. We all know that Itaú and all the companies that we participate are very concerned about the ESG practices. In this quarter, Itaúsa released again the 2019 integrated report, where you can find detail of our strategy, the way we take decisions, how we analyze M&As, how we do everything from the companies, all the commissions and committees that support the administration of the company. It's a very complete and very transparent report that we release this year for the second time. Itaú joined now the FTSE4Good.
That is an index from the Financial Times for companies that demonstrate outstanding ESG practice. For us, we are very proud to be part of this index also, among others that we have participated, like the Dow Jones Sustainability Index, the ESG here at B3. I think this also confirms the good practice that we have related to ESG and our shareholders and our actuation also in all the fields that we are involved in Brazil. We have created a commission for corporate governance. Of course, we did many things through these last years, but we decided to have a special focus and a special commission to work know the policies and practices that we have and approves our Board of Directors.
We now have a formal commission to analyze all the governance and proposals for the company, and to keep it updates to the best practices that we see in Brazil and outside Brazil also. We're going now to the next slide, where we have passed through one slide per company to all the companies showed already their results and made their own conference call. Here is just a glance, a quick glance in the results. In the case of the bank, we put in this highlight the loan portfolio that grew 20% in the period, also related to medium and small-sized companies. As I said in the beginning of the crisis, with large companies requiring huge amount of lines that were pre-approved for them to face the pandemic. We have been very strictly, continue to be with the expenses of the bank.
We have a decrease in normal terms, and we increased the expected losses in 120%, as I said at the beginning of the explanation. We have been very cautious, in terms of new loans. Of course, we are providing new loans for millions of clients. We want to see how really the economy will perform in the coming quarters. We have been very concerned and very conservative in terms of providing new loans to the clients, because there are a lot of uncertainties related to the economy and employment, how the economy will really perform after the support that the government are giving for the families. Many uncertainties relate to the economy. We have been cautious in this period to see how things will go in terms of the economy. Continue to operate the bank.
We took advantage of this new scenario for the economy. We increased our digital operation. We increased 1 million new accounts for the banks opening through our app in the first half of 2020. It's a good performance. We had 22.9 million of digital customers now. We had an increase of 17% when we compare one year ago. Clients are using more the digital channels that we provide for them. We are happy to see that to be a possibility to continue to reduce costs and increase the digital transformation of the company. We continue to provide credit. We open new lines, as I said, with a more conservative approach. We provide credit from the new lines also that the government provide for the banks, for payroll, and et cetera. Anyway, the results reduced.
Here we have seen the numbers little different from the numbers that the bank showed in their announcement because here we are seeing the numbers in IAS. We have a difference when we compare to the bank numbers released the last week because the bank continued to use the central bank regulations for accountants. We have a reduction in the recurrent net income of 41.7% in the bank, BRL 3.8 billion. Also, of course, a reduction in the ROE from 22 to 12 almost. The loan portfolio, as I said, increased in the periods. Going to the next slide nine, we can see highlights from Alpargatas. Alpargatas increased almost double, 93% growth in online sales for the first half in all regions, minimized the effects of the store closures in the period. Anyway, we have a recurrent EBITDA that reduced 42.7%.
It was a good result, much better than we expected when the crisis started. Most of that we use to sell products of Alpargatas, especially supermarkets remained open. We could operate the company in a lower level, but in a reasonable level during the period. These were growing from May, June, July. We are now almost normal in terms of production. The online was a big highlight for the company. That increased dramatically in all the channels that we operate in terms of digitals. We continue to manage the capital. We definitively wrote off the investments in Argentina. It was a bad investment when we bought the company. We took some years to close. We finally closed and sold all the operations that we had there. We sold the factories, we sold and now we are in Argentina only selling Havaianas products.
What is good because there were a loss of capital. We had bad results in Argentina for many, many years. Net income reduced, recurrent net income, 63%. We showed 25 million BRL now. Of course, also the ROE reduced to 6.6, and EBITDA also reduced. This is for the first half. We, in this quarter, expect a much better result, almost a normal result for Alpargatas, considering the trend that we see in June and also in July. We're going to see Duratex on the slide number 10. Duratex also suffered at the beginning of the crisis. We almost stopped all the factories of the company in the end of March and beginning of April. Since then, we started reopening the operations and all the factories now are operating since June, in a very good level. July was very, very good.
We are full operation, 24 Duratex in all the sectors. Remembering that the material constructions network and stores and so on continued to be opened during all the segment that the government didn't ask to close. The sector with low interest rates and so on, are very active. We gain market share. We use our financial strength to renegotiate and give more term extension for clients. We gain market share during our strength and brands, and also with problems that our competitors had, especially, in April and May. We gain market share in all the lines and all the products that we have. Our factory that we are building with Lenzing of dissolving pulp , continue to be constructed. We don't see delays in the starts of the operations. That is in the beginning, March of 2022.
This continues to be in line, and we announced how the project will be financed and how is the financial structure for that investment. Duratex for the first year, released their integrated report also with long-term strategic vision, how the company operates, how decisions are made, why we are in sectors. I think it was a very important release for our shareholders and analysts and portfolio managers that follow the company. They found there a very good for the company. We are recovering. Second quarter was better. Third quarter looks to be very good for the company. Also the ROE reduced for 3%, and the EBITDA reduced less than we expected.
Duratex is also, as Alpargatas, probably going to have a good third quarter. In the case of NTS, we had received $95 million in earnings from the company in the first half of 2020. As I said, we have deferred some revenues from Petrobras. Petrobras has started the process of divesting the 10% stake that remains with Petrobras in the portfolio, and we are analyzing how we are going to do with this process of divesting of NTS. Of course, the consortium that bought the company, and that we are in this consortium, are interested in buying this remaining stake from Petrobras. NTS acquired Mantiqueira Compression Station in the state of Minas Gerais for BRL 46 million. We have the affirmation from Fitch Ratings of a AAA rating here in Brazil. Going forward on slide 12, we are going to start to talk a little about our own results.
Those are results that we released last night. A net income of BRL 1.6 million, a reduction of 67%. The recurrent net income of BRL 2.5 million, a reduction of 46%. ROE recurrent of 9.4, mainly because all the companies had bad results in the period, especially the bank that showed also huge reversion, and is our main investment in our portfolio. Show shareholders equity of almost BRL 53 billion and total assets of BRL 56 billion. That is mainly the investment that we have in the companies that we have stakes. Dividend yields in the last 12 months, 9.1. Of course, this dividend yield will be reducing in the coming quarters, because as I said, we are going to receive less dividends from our subsidiary, and we pass through less dividend for our shareholders this year.
We can see that we continue the practices of paying to our shareholders the same amount, the dividends that we received from the bank. We have the restriction, as I said, from the central bank to pay more dividends than 25%. We are going to continue to pass through the dividends that we received from the bank to our shareholders and keep the dividends from the other companies to pay for the cost of the holding, to face the cost that we have in terms of fiscal and administrative expenses to our company. As I said, we have the dividend yields. We continue to pass through the dividend that we received from the bank, and we announced a dividend for this month of August that we'll pay at the end of the month, that BRL 0.002 per share.
That is equal for what we pay each quarter for our shareholders. We will be, as a new quarter in terms of dividends for our shareholders, that they are going to receive this month. Going ahead, we see the discounts that we have, the discount of 20.2% compared to the sum of the parts and market value of fair value for our portfolio. The discount reduced during July is around 16%-17% at this moment. We continue to have a great evolution of the individual stockholders. We achieved 751,000 shareholders at Itaúsa in June 2020. Our trade increased to BRL 226 billion per day, and the discounts reduced from 25% to 20%, and now is around 17%-16% during the last weeks. The final slide is the performance of the shares.
Of course, the performance in recent periods are not so good, especially because our main investment, that is Itaú Unibanco Holding, had a bad performance in terms of results due to the crisis that we all know. I talk a little about the fall in results of the bank. That's what I had to say. We are open now to question and open question and answer session through the web or through the telephone as you wish. Thank you.
Thank you, Mr. Alfredo. Ladies and gentlemen, we now begin the Q&A session. If you have a question, please press star key followed by the one key on your touchtone phone now. If at any time you would like to remove yourself from the questioning queue, press star two. Please restrict your questions to two at a time. Our first question comes from Jason Mollin with Scotiabank.
Hello, everyone.
Okay.
Thanks.
Hello, Jason.
Hi. Good to hear from you. My question is related to the outlook for tax policy in Brazil, particularly given that the PIS/Cofins that you pay on the dividend flows. Can you hear me? What are you thinking about the future tax regulation changes in Brazil and how that could impact Itaúsa?
Okay. Thank you for your question, Jason. Nice to hear from you. Well, we saw during the last week that the government sent the Congress a law project to change the law in Brazil related to taxes, involving especially the PIS/Cofins and ICMS from the state. It's a total new regulation that has been proposed by the government. Of course, this will need a lot of negotiations from the government and the Congress that are very, at my opinion, difficult issues that are proposed by the government that will need a huge negotiation with the governors, city mayors, and the Congress to really achieve a negotiation that can be approved. I personally believe that the way the proposal is done, we are going to see many changes, especially in the percentage of the new tax that has been proposed of 12%.
It seems by many economists to see things be higher than necessary, so we are going to see what will happen in that case. For what we see from this new law is good for Itaúsa because we reduce the tax that we paid. I think part of the reduction of the discount that we had in the last weeks is due to the new proposal from the government that will reduce the costs that we have in the holding to support the operations and the tax that we pay. We have to see how this will really be approved by the Congress. In the terms of dividends and corporate taxes directly, the government didn't send yet their proposal. We need to wait and see how the government will propose the change in corporate taxes for the companies.
The finance minister already confirmed that they will propose reduction in corporate taxes and increase the tax for dividends in the coming years. For what I personally understood, this will be done in the coming years, not immediately. They will reduce the corporate taxes, and they will increase the tax from dividends that is zero to date in the coming years in a pace that is not yet known. We have to wait. There is not a clear answer, but it seems that we are going to have less tax expenses, and that's what the market is reading, and we agree that is probably what will happen. Let's see how much this will be really approved by the Congress in the coming months. Any other question?
Sure. Wanted to talk about maybe you could give us an update on the Liquigás investment. We understand that it's still under review by CADE. What is the status at this point?
The status is the CADE changed the person that was analyzing the case. We had some backwards because the new person is studying the case. We were expecting to have the CADE proposal or approval as we entered the case in the CADE by October or September. Probably this will take more time, probably by the end of the last quarter of this year or beginning of next year. We continue to be confident that the proposal that the consortium made to the CADE already offer solutions from the concentration in many regions in Brazil, especially in the Northeast. We are confident that the proposal will be approved essentially as we propose, or with some small restrictions imposed by the CADE. Unfortunately, this change in the person that is analyzing the case.
There are some small pills under the proposal that we made, but we continue to be confident that the beginning of next year maximum, we are going to start the process of integration of the two companies. In terms of financing from Itaúsa, we need BRL 1.4 billion for that investment, and we analyze with banks probably the best solution will be issue of debentures for finance this acquisition around seven years due, like the one that we issued for the acquisition of NTS. We are expecting probably by the end of the year, we have news and we probably issue a debenture in the capital markets from Itaúsa again in seven-year periods for that.
Thank you very much.
Okay, Jason, it's nice to hear from you.
Thank you, sir.
We don't have any questions from the web. I don't know if you have other questions from phone. Otherwise, we can stop.
We don't have any questions. This concludes today's Q&A session. Mr. Alfredo, at this time, you may proceed with your closing comments.
Okay, thank you for the participation of this intermediate conference call that we made. We don't make conference call every quarter because all the companies made our subsidiaries, so we don't want to be repetitive in terms of information and the holding level, we don't change many things from one quarter to the other. We increased 30% in the numbers of attendance this quarter, so we are happy to be here for the foreign investors that follow us. We can see now different from the beginning of the crisis with Paradise and Duratex operating at full capacity. We are going to show a much better result in the third quarter and the second semester. The bank also, the economy overall is performing better than expected. Most of the economists are reducing the regression on GDP for the year, so it's a good news.
Hope this help also in the terms of the bank. We renegotiate billions of contracts, as you know. We expected as the economy is performing a little better than expected, that we have more provisions that we probably will have to make in the coming quarters will be less than we expected at the beginning of the crisis. I think the scenario for the industrial sector and for the bank also, we expect a better scenario, not a good scenario, but a better scenario than we saw at the beginning of the crisis. Inflation continue to be very low, interest rates in the lower levels. We have to check how the unemployment will perform in the coming months and quarters to see how we and how we will perform in the country.
Anyway, we think that the worst are gone, and we are in a better pace for the coming quarters, what will be all good for our company. Thank you for your time being with us. Take care, and talk in the next conference call.
That does conclude the Itaúsa conference call for today. Thank you very much for your participation, and you may now disconnect.