Santander Brasil Q1 profit misses estimates as high rates, household debt weigh

SAO PAULO, April 29 (Reuters) - Banco Santander Brasil's (BSBR) first-quarter net profit fell 1.9% from a year earlier to 3.79 billion reais ($761.66 million), the lender said on Wednesday, below analysts' expectations of 4.13 billion reais in an LSEG poll.

Latin America's largest economy is a key market for its Spanish parent Banco Santander, which reported its own results earlier in the day.

* Net interest income (NII) - earnings on loans minus deposit costs - fell 0.7% to 15.81 billion reais.

* The decline reflected lower market NII, negatively affected by sensitivity to high interest rates, the bank said in a securities filing.

* Return on average equity (ROAE), a gauge of profitability, stood at 16%, down from 17.4% a year earlier.

* Provisions for loan losses fell 2.6% year-on-year to 6.83 billion reais, but were up 0.9% on a sequential basis.

* "Provisions remained pressured by the macroeconomic environment and elevated household indebtedness," Santander Brasil said.

* Brazil's government has been crafting a debt renegotiation program to ease pressure on household budgets.

* The results come as Santander Brasil readies a leadership transition, with CEO Mario Leao set to be replaced by stock exchange operator B3's CEO Gilson Finkelsztain by mid-year.

($1 = 4.9760 reais) (Reporting by Tiago Brandao in Gdansk and Gabriel Araujo in Sao Paulo. Editing by Louise Heavens and Mark Potter)