Inter & Co. Inc.

Good morning, and thank you for standing by. Welcome to Entering Company 3Q 2022 Earnings Conference Call. Today's speakers are João Vitor Menin, CEO, Alexandre Rício, VP of Finance, Helena Caldeira, CFO, and Santiago Stel, Strategy and IR Officer. Please be advised that today's conference is being recorded and a replay will be available at the company's IR website. At this time, all participants are in listen-only mode. After the prepared remarks, there will be a question and answer session. For the Q&A session, we ask you to write down your question via the Q&A icon at the bottom of your screen. Your name will then be announced and you will be able to ask your question live. At this point, a request to activate your microphone will appear on your screen. If you do not want to open your microphone live, please write down no microphone at the end of your question. In this case, our operator will read your question aloud. All questions will be answered in the language we've received them. Please note that there is a translation button on the right side of your screen where you can choose the language you want to hear. Now, I would like to welcome one of your speakers for today, Mr. João Vitor Menin, CEO. Sir, the floor is yours.

Hello. Good morning, everyone. Thank you for joining our third quarter earnings call. First, I will do a quick introduction and then I'll pass it to the team who will provide an update on the business and on our financial performance. We completed what I think was an excellent quarter. The numbers that we present today reflect our consistence and dedication, but more importantly, the passion that we have towards our mission. Jumping to the page number two, I would like to share with you the highlights of this quarter. From a client perspective, we added 2.1 million net new clients, reaching almost 23 million clients so far. This put us ahead of our goal of ending 2022 with 24 million total clients. We were able to decrease our CAC to R$28, the lowest level in over one year. We believe that the combination of lower CAC and also acceleration in new clients is only made possible given the growing strength of our brand. In terms of volumes, which is a reflection of engagement, we reached the record R$155 billion in TPV. this consolidated TPV plus peaks grew an impressive 69% year over year. On the long side, we grew 47% year over year, and we are on track to deliver 50% growth on the calendar year. We call these growth levels disruptive. It allows us to keep gain significant market share across products and dilute our cost base. A point which makes me particularly pleased is that our MPL ratio was flat for the quarter. This is the result of a strong effort and dedication to master the combination of high growth and good quality underwriting and also good collection process. Going out to funding, growth was also remarkable, reaching 41% year over year. We reached 28.4 billion reais at the end of the quarter, and another 5 billion reais in third parties fixed income distribution. On monetization, we can see that our gross revenue suppressed 1.5 billion reais mark for the quarter, which will take us above 6 billion in the year, twice the level we had on 2021. One important highlight is our marketplace, which we call Introshop, which reported a record net take rate of 5.1% in the quarter. Having covered the operational and the financial highlights, I would like to share my top priorities for 2022 and beyond. First thing, growth. We are a growth company. We need to keep growing, both in clients and loans slash deposits. We consider ourselves a disruptor and have big aspirations where we want to get to. Second thing, it's about engagement. With volumes, which continues to grow significantly, with market shares that are becoming truly meaningful. Third thing, innovation. We are a very innovative company. To name a few very interesting examples of the years, we have the Global Count, the first of its kind, the InterShop on the web version, and first-ever InvestNow PayLayer product on our investment platform. And finally, fourth topic, calibrating the right risk-reward for our credit business. We are working on repricing, as we will comment later. We're highly focused on having strong asset quality. Now, I'd like to comment that I'm pleased that we just received the excellent news that I best recognized Inter with three awards two days ago, which are the best digital broker of Brazil, the best super app, and last, the best digital bank. We take this recognition with humility, but it does make us proud and give us energy to work hard every day to fulfill our mission to simplify people's lives through our super app. Now I'll hand over to Alexandre that will provide some updates on the business verticals.

Thank you, João, and good morning, everyone. I'll go through some highlights of our six business verticals, all of which had an exciting quarter. Starting on page five, I'll talk about day-to-day banking. We reached an impressive 155 billion TPV, as mentioned by João. This quarter, we started disclosing TPV, including PIX, as we believe it better explains client engagement and the activity of day-to-day banking that's happening at Inter. On the debit and credit card front, TPV reached 17.2 billion, with the mix trending towards credit, which now accounts for 46% of the mix. The evolution of this TPV towards credit cards brings an increasing blended interchange fee. On PIX, we saw another quarter of strong growth with Inter finishing with a market share of 80% of the transactions in Brazil. Finally, our overall TPV grew by 16%, significantly outpacing the growth in the number of clients, an important factor to understand client engagement with the platform. Moving to page six, on the credit front, our gross loan portfolio surpassed 22 billion, delivering 47% year-over-year growth. The focus on loans has been to balance growth and profitability. With respect to profitability, we have been consistently repricing our portfolio as a result of the new rate environment and spread expansion strategy. For reference, our underwritten volume in the quarter reached R$6.5 billion, which is all at the prevailing rate environment. In terms of growth, we're on track to deliver 50% year over year, aligned with our market share and cost dilution objectives. We'll bring more color on this point in the financial section. Going to page seven, we highlight our insurance and protection distribution business. We continue to improve our product offering, sustaining our position as the leading digital insurance distribution platform in Brazil. with more than 20 products sold through the app. Our net revenues reached 31 million, driven by very strong digital sales. We currently have more than 1.1 million active insurance policies at Inter. And we continue to actively work to further penetrate Inter's client base. Going to page eight, A brief update on Interinvest. As a reminder, this is our direct-to-consumer business with 62 billion in AUC. This quarter, we had record net inflows of 3.8 billion reais, accelerated by the high interest rate environment, attracting fixed income investments. We reached 40 million in revenues, also a record for us. Recently, we launched the first ever InvestNow PayLater product. This is just another example of bringing innovation to our clients with the goal of simplifying their lives through our super app. Going to page nine, I'll talk about Intershop, which is our e-commerce platform. We delivered a record $48 million in net revenues, driven by an impressive net take rate that reached 5.1% in the quarter. I'd like to highlight that 75% of the sales in the quarter came from recurring customers. And we're still able to attract 565,000 new customers to Intershop. Three final highlights are that, one, we surpassed the 900 seller mark. Two, we surpassed 800,000 SKUs. For some of the most exciting, we launched our end-to-end e-commerce offering through the web, where clients can do their product selection online and get a QR code to wrap up the transaction through the app. Visit intershop.bancointer.com.br to taste it. Finally, on page 10, I'd like to spend a moment on our cross-border services unit. We continue to grow our global accounts, having added 360,000 accounts in the quarter to reach a total of over 500,000 global accounts. The level of engagement in this product is inspiring and motivates us to keep evolving the offering. We think the monetization potential here is very big through a combination of FX, interchange, float, and take rates. Now, Elaine and Santiago will provide an update on our financial performance. Thank you.