What are LCI and LCA?

LCI (Letra de Crédito Imobiliário) and LCA (Letra de Crédito do Agronegócio) are fixed‑income investments issued by banks. The big advantage: they are exempt from Income Tax for individuals.

Difference between LCI and LCA

The only difference is the destination of the money:

  • LCI: the bank uses it to finance the real estate sector
  • LCA: the bank uses it to finance the agribusiness

For the investor, they work in the same way.

Advantages

  • Exemption from IR (higher net income)
  • Protection by FGC up to R$ 250,000
  • Yield generally linked to CDI (85-100%)
  • Security similar to CDB

Disadvantages

  • Minimum lock‑up period of 90 days (cannot withdraw before)
  • Minimum investment usually higher (R$ 1,000-5,000)
  • Fewer options available than CDB

LCI/LCA vs. CDB

An LCI that pays 85% of CDI can yield more than a CDB of 100% of CDI, due to the exemption from IR:

CDB 100% CDILCI 85% CDI
Gross yield13,65%11,60%
IR (15%)-2,05%0%
Net yield11,60%11,60%

In this example, they yield the same. But an LCI of 90% of CDI already beats the CDB of 100%.

When to invest in LCI/LCA

  • When you won’t need the money for at least 90 days
  • To diversify fixed‑income investments
  • When you find rates above 90% of CDI