Grupo Supervielle S.A.

Good morning everyone and welcome to the Grupo Supervielle first quarter 2023 earnings call. This is Ana Bartesaghi, fresher and IRO. A slide presentation will accompany today's webinar which is available in investor section of Grupo Supervielle's investor relations website. Today's conference call is being recorded. There will be an opportunity for you to ask questions at the end of today's presentation. If you want to ask a question, you need to be connected to a Zoom platform from any device. We will not be able to answer questions if you are connected from a phone line. Also, please make sure your first and last name appear in the Zoom platform you are using. You will be able to ask a question by voice or send questions Speaking during today's call will be Patricio Supervielle, our chairman and CEO, and Mariano Biglia, our chief financial officer. Also joining us is Alejandro Stengel, first vice chairman of the board and CEO at Banco Supervielle. All will be available for the Q&A session. As a reminder, today's call Patricio Supervielle, our chairman and chair. and afterwards, Mariano Biglia, our CFO, will take a deeper look at our performance and near-term perspectives. This will be followed by a Q&A session. Patricio, please go ahead.

Thank you, Ana. Good morning, everyone. Thank you for joining us today. I will begin my presentation with slide three. We are pleased to have began the new year delivering ROE of 2% in real terms in the first quarter. We were able to achieve the positive ROE even as we continue to operate in macro and political environments that are volatile and challenging. The various initiatives that we have implemented since first Q22 to optimize operations and streamline our branch network. have allowed us to achieve significant operating leverage, contributing to bottom line profitability. Key among these were personal expenses, which declined nearly 12% year-on-year in real terms. We also benefited from our flexibility in managing assets and liabilities to optimize our financial margin in a context where we saw inflation increase to 22% for the quarter. Mariano will discuss our performance shortly. For the current year, with upcoming presidential elections, we expect to continue facing a volatile backdrop. As a result, our key priorities for 2023 include, first, we are advancing on executing on our key strategic pillars, prioritizing profitability over growth. We have a large and loyal customer base and we see the opportunity to deepen our relationship with them. Consequently, for the current year, we're focusing on customer engagement, monetization and cross-sell to gain additional share of their wallet. Specifically, we are aiming to cross-sell insurance, investment products, short-term loans, along with cash management services. Second, we have adopted an increasingly conservative risk profile. With accelerated inflation putting pressure on individuals' disposable income, we are prioritizing payroll customers while implementing stricter credit scoring overall. On the corporate front, we are focused on providing lending and transactional services to our key We are also managing our exposure to public sector bonds while our shareholder equity remains fully hedged against inflation. Now please turn to page 4. As shown clearly on this page, we are navigating a complex macroenvironment in Argentina. In foreign exchange, reserves have been further impacted by the severe drought that surpassed the worst-case scenario this year, with the value of the harvest falling by $20 billion year-on-year, negatively impacting levels of activity, price, and external accounts. At the same time, interest rates continued the upward trend on the back of accelerated inflation while the FX rate continues to lag. In turn, While fiscal spending has declined in real terms since the high levels observed in the first half of last year, the fiscal balance has deteriorated as revenues...

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