Intercorp Financial Services Inc. Common Shares

Good morning and welcome to the Intercorp Financial Services third quarter 2022 conference call. All lines have been placed on mute to prevent any background noise. Please be advised that today's conference is being recorded. After the presentation, we will open the floor for questions, and at that time, instructions will be given as to the procedure to follow if you would like to ask a question. Also, you can submit online questions at any time today using the window on the webcast. and they will be answered after the presentation during the Q&A session. Simply type your question in the box and click Submit Question. It is now my pleasure to turn the call over to Rafael Borja of Inspire Group. Sir, you may begin.

Thank you, Operator, and good morning, everyone. On today's call, Intercore Financial Services will discuss its third quarter 2022 earnings. We are very pleased to have with us Mr. Luis Felipe Castellanos, Chief Executive Officer of Intercore Financial Services, Mrs. Miquela Casasa, Chief Financial Officer of Intercore Financial Services, Mr. Gonzalo Basadre, Chief Executive Officer of Interseguro, Mr. Bruno Ferrecho, Chief Executive Officer of Inteligo, and Mr. Carlos Tori, Executive Vice President of Payments at Intercore Financial Services. They will be discussing the results that were distributed by the company yesterday. There is also a webcast video presentation to accompany discussion during this call. If you didn't receive a copy of the presentation or the earnings report, they are now available on the company's website, isa.com.pe, to download a copy. Otherwise, for any reason, if you need any assistance today, please call Inspire Group in New York at 212-710-9686. I would like to remind you that today's call is for investors and analysts only. Therefore, questions from the media will not be taken. Please be advised that forward-looking statements may be made during this conference call. These do not account for future economic circumstances, industry conditions, the company's future performance, or financial results. As such, statements made are based on several assumptions or factors that could change causing actual results to materially differ from the current expectations. For a complete note on forward-looking statements, please refer to the earnings presentation and report issued yesterday. It is now my pleasure to turn the call over to Mr. Luis Felipe Castellanos, Chief Executive Officer of Intercall Financial Services, for his opening remarks. Mr. Castellanos, please go ahead, sir.

Thank you. Good morning, everyone, and welcome to our third quarter earnings call. Thank you very much for attending our call today. We're glad to deliver a good performance this quarter, as you will hear during our presentation. Focusing on recent developments affecting our country, we continue to see an uncertain political environment. Accusations against President Castillo and members of the government continue to stretch out in Congress and in the judiciary branch. We believe these headlines and news around corruption will continue with no clear path for resolution of these issues. On the latest announcements of rating agencies, last month, Fitch Ratings decided to keep Peru's sovereign rating at BBB, but changed the outlook from stable to negative due to this political instability, and stating a deterioration of the effectiveness of measures implemented by the government. For its part, S&P Global Ratings ratified its own BBB rating with a stable outlook on the back, macro balances, and stable public finances. On the economic front, following widespread talks of a global recession, the latest survey of expectations by the central bank shows Peru's GDP growth estimates for 22 and 23 slightly decreasing to 2.7 and 2.5% respectively. With consumer dynamics moderating, we at IFS started tightening our underwriting standards in consumer loans and SMEs early in that quarter. while acknowledging a gradual normalization in cost of risk levels, as Miquela will touch upon later in the call. Later today, Peru Central Bank will hold its monthly monetary policy meeting. While we cannot discard an additional 25 basis point rate hike as most expectations point to, we believe we're getting close to the end of the hiking cycle, with the policy rate currently at 7%. The recent slowdown in the 12-month inflation rate to 83% from mid-year levels of 8.8% is consistent with this reading. Yet inflation expectations for year-end and most part of 2023 remain above the central bank target range. Related to that, higher interest rates have held margins this year. Deposits costs only climbed modestly through the first half of the year, however, have accelerated in the second half, slowing margin expansion. Notwithstanding this background, we are happy to continue to see double-D growth in banking and insurance revenues, moderation of investment losses in wealth management, and solid growth of our payment business. It is important to note that this week, for instance, the banking superintendent announced that the number of monthly mobile transactions in the banking system has increased by 17 times since 2019. The superintendent has qualified this as explosive growth that has benefited customers in terms of convenience, speed, and efficiency. Indeed, mobile banking transactions in the country now exceed the number of transactions in all other channels added together. The interoperability mandate dictated by the central bank We accelerate this with an opportunity to bring more people into the financial system while reducing the use of cash. To round up, we confidently believe that our culture, our people, our efficient operations, our sound capitalization, and our strong digital tractions continue to be our strengths and are the pillars that will allow us to continue to deliver sustainable growth in the future. Now, let me pass it on to Miquela for a detailed update of our results. Thank you very much.