(Adds more comments from CEO, updates preferred shares’ move) SAO PAULO, Feb 2 (Reuters) - Itau Unibanco Holding SA CEO Milton Maluhy said on Tuesday he is focused on beating back the challenge from financial startups, exploring options to improve the Brazilian lender’s results in Chile and Argentina and dealing with the uncertainties brought by the coronavirus pandemic. In his first public appearance at the helm of Brazil’s biggest lender, Maluhy said Itau’s results in Chile and Argentina are not creating value for shareholders. When asked by an analyst if Itau is focused on acquisitions or sales in Latin America, Maluhy described the bank as generally being a buyer, but added that it is open to opportunities. Itau has posted provisions for bad loans in its Chilean Itau CorpBanca unit since it acquired a controlling stake in 2016. In June, for instance, CorpBanca posted a non-cash loss of $929.7 million due to the impairment of assets. Maluhy, who took over from retiring Itau CEO Candido Bracher on Tuesday, said the bank is performing well in the wholesale part of its Argentina unit, but is struggling in retail, mainly due to that country’s economic downturn. He noted that Itau is satisfied with its performance in Paraguay and Uruguay. ADVERTISEMENT Besides the challenges in Latin America, Maluhy also said he intends to make Itau more competitive with fintechs. And he did not rule out potential acquisitions in that area. He said he is focused on Itau’s newly launched payments unit, which includes credit cards, as well as the card processor business Rede, the retail digital payments unit and cash management - areas in which the bank has been most challenged by fintechs. Itau’s preferred shares were down about 2% on Tuesday, underperforming Brazil’s main stock index. 2021 OUTLOOK Maluhy intends to speed up a cost control program in 2021, targeting a reduction of 2% and no more than a 2% rise, but the bank does not intend to close more branches this year. It also plans to expand income from fees and reduce loan losses, though Maluhy also said there was still a lot of uncertainty due to the pandemic. ADVERTISEMENT “The bank foresees 4% GDP growth in Brazil this year, but if mass vaccination gets delayed by six months, GDP is likely to grow only 2%,” Maluhy added. Itau expects its cost of credit to decline by up to about 30% in 2021 from a year earlier, to a range between 21.3 billion reais and 24.3 billion reais in 2021. Last year, it totaled 30.2 billion reais, as the lender cushioned for potential future losses. Loan delinquency ratio, however, is expected to rise this year, reaching a peak by the end of the year or in the first quarter of 2021. Its 90-day default ratio at the end of December was 2.3%. Itau forecasts its loan book growth to be between 5.5% and 9.5%, signaling it could expand at a slower pace than in 2020, when it rose 9.6%. Depending upon the economy’s growth trajectory, Maluhy said the bank will consider more disbursements in riskier credit lines. Net interest income from clients is expected to grow between 2.5% and 6.5%. (Reporting by Carolina Mandl; Editing by Kirsten Donovan, David Evans and Paul Simao)