Company: BBD
Filing Date: 2025-03-31
Form Type: 20-F
Source: 0001292814-25-001244
Chunk: 409

Company: BANK BRADESCO
Filing Date: 2025-03-31
Form: 20-F
Item: Item 19
Chunk 409
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389,063,079 thousand) refers to operations  

  40.3.      Market risk  

Market risk is represented by the possibility
of financial loss due to fluctuating prices and market interest rates of the Company’s financial instruments, such as your asset
and liability transactions that may have mismatched amounts, maturities, currencies and indexes.

Market risk is identified, measured, mitigated,
controlled and reported. The Company’s exposure to market risk profile is in line with the guidelines established by the governance
process, with limits monitored on a timely basis independently of the business areas.

All transactions that expose the Company
to market risk are identified, measured and classified according to probability and magnitude, and the whole process is approved by the
governance structure.

In line with the best Corporate Governance
practices, with the objective of preserving and strengthening the management of market risk in the Group, as well as complying with the
provisions of Resolution No. 4,557 of the National Monetary Council, the Board of Directors approved the Market Risk, which is reviewed
at least annually by the competent Committees and by the Board of Directors, providing the main guidelines for accepting, controlling
and managing market risk. In addition to this policy, the Group has specific rules to regulate the market risk management process, as
follows:

  Classification of Operations;  
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  Reclassification of Operations;  
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  Trading of Public or Private Securities;  

  Use of Derivatives; and  

  Hedging.  

Market Risk Management Process

The market risk management process is
a corporation wide process, comprising from business areas to the
Board of Directors; it involves various areas, each with specific duties in the process. The measurement and control of market risk is
conducted in a centralized and independent manner. This process permits that the Company be the first financial institution in the country
authorized by the Central Bank of Brazil to use its internal market risk models to calculate regulatory capital requirements since January
2013. This process is also revised at least once a year by the Committees and approved the Board of Directors itself.

Determination of Limits

Proposed market-risk limits are validated
by specific Committees and submitted for approval by the Integrated Risk and Capital Allocation Management Committee, and then for approval
by the Board of Directors. Based on the business’ characteristics, they are segregated into the following Portfolios:

Trading Portfolio: it comprises
all financial assets at fair value through