Banco Santander - Chile ADS

Ladies and gentlemen, thank you for standing by and I would like to welcome you to Banco Santander Chile's second quarter 2026 earnings conference call on August 5, 2026. Please note at this point all participant lines are in listen-only mode. After the call, there will be an opportunity to ask questions. So with this, I would now like to pass the line to Patricia Perez The Chief Financial Officer. Please go ahead.

Good morning everyone and thank you for joining us today. I am Patricia Perez, CFO of Banco Santander-Chile and I'm joined by Cristian Vicuna, Head of Strategy and Investor Relations and Andrés Sansone, Chief Economist. This quarter reinforces the strength of our franchise. High profitability, disciplined cost management, and a solid capital position. While we continue to execute our strategy to deliver a simpler and enhanced value proposition to customers with a focus on sustainable growth and shareholder returns. First, Andrés will give you an overview of the economic and regulatory environment. Cristian will then walk you through our strategy, our second quarter results, and our updated view for 2026. Finally, we will conclude with a Q&A session. With that, let me turn it over to Andrés Sansone.

Thanks, Patricia. Let me start with the big picture. Since our last webcast, the global backdrop has remained complex. External inflationary pressures remain, with geopolitical tensions driving oil prices and the inflationary scenario for Chile. At the same time, long-term rates have moved higher and expectations from monetary policy abroad have shifted upward, leaving global financial conditions less supportive. For Chile, this has translated into a weaker peso, around 930 pesos per dollar during the last month, and renewed pressures on short-term inflation. Locally, the June CPI was flat month-on-month, but still above expectations, bringing annual inflation to 4.3%, with the surprise mainly concentrated on food. Short-term inflation expectations have increased, and now we expect a variation of 4.4% in 2026 in the U.F., although the two-year expectations remain anchored at 3%. On activity, the economy continues to lose momentum during the first half of the year. The weakness has been concentrated in three areas. First, supply shocks in natural resources sectors, particularly mining and fishing. Second, the impact of higher oil and fuel prices on household disposable income. And third, a slower than expected recovery in construction. Beyond these three factors, the labor market has also weakened, with seasonal adjusted unemployment rising to 9.3%. Looking ahead, activity should improve. Gradually, mining production faces a more favorable comparison base in the coming months. The mining and energy investment pipeline remains solid, and the recent fall in fuel prices Thank you very much. Thank you very much. This year, making the macro scenario more challenging and calling for a more cautious monetary policy stance. Now, turning to the regulatory and policy environment on slide five, the main development is the completion of the National Reconstruction Plan's bill passage through Congress. Yesterday, the Senate approved the last outstanding provision The bill is therefore now ready for enactment. The bill includes several pro-market initiatives aimed at reactivating growth. On the business and investment side, the most relevant measures are the gradual reduction in the corporate tax rate from 27 to 23% between 2027 and 2029, the reintegration of the tax system, investment incentives and tax stability, Faster permitting process and reconstruction spending. We believe this measure should support private investment, improve business confidence, and strengthen economic activity over time. Moreover, the bill includes household support measures such as the temporary VAT exception on new homes, housing reconstruction programs, and improved housing affordability and employment support. If these are implemented effectively, this measure should support housing demand, mortgage origination, and consumer activity. Complementing this, the government has just submitted a bill to extend and expand the mortgage interest rate subsidy and the Fogaes state warranty for first home purchases. The proposal raises the number of subsidies from 50,000 to 80,000 also lift the maximum value of eligible new homes from 4,000 U.S. to 6,000 U.S. and extend the program until May 2026. Combined with the temporary VAT exemption on new homes, this should improve affordability for middle-income households, help absorb the stock of more than 100,000 unsold units, and therefore has the potential to support mortgage origination and recovery in the construction sector. In addition, we continue to monitor other regulatory relevant changes, including the repos and securitization law, the proposed model for market risk weight assets, and the advances toward internal models for credit risk. With that, let me hand over to Cristian.