SAO PAULO (Reuters) -Brazilian state-run lender Banco do Brasil SA on Thursday reported a 60% slide in second-quarter adjusted net profit, and it announced a sharp cut to its full-year outlook and dividend payout.

Net profit came in at 3.8 billion reais ($702.4 million), below the 5 billion reais expected in an LSEG poll.

"2025 is a year of adjustments for growth acceleration," Chief Executive Tarciana Medeiros said in the earnings statement.

Banco do Brasil, which was the last among Brazil's largest listed banks to release results, posted a return on equity of 8.4%, down from 21.6% a year earlier and 16.7% in the first quarter.

In a separate filing, Banco do Brasil cut its 2025 shareholder payout to 30% of its profit, down from the previous range of 40% to 45%, attributing the move to factors including the results, cash needs and capital projections.

The earnings follow a challenging first quarter, when higher-than-expected delinquency in its key agribusiness loan portfolio and regulatory changes hurt earnings.

The bank's shares have fallen more than 30% since the first-quarter report, which had led the lender to suspend some of its initial 2025 projections.

Banco do Brasil resumed forecasts for those metrics on Thursday, projecting full-year adjusted net profit between 21 billion and 25 billion reais, far below its initial range of 37 billion to 41 billion reais provided at the start of the year.

The mid-point of the fresh range, 23 billion reais, also falls short of the 26.8 billion reais expected by analysts polled by LSEG.

The lender also cut the estimate for its credit portfolio growth to between 3% and 6% this year, from its previous expectation of between 5.5% and 9.5%.

($1 = 5.4101 reais)