Grupo Supervielle S.A.

Good morning, everyone, and welcome to Grupo Superviel's first quarter earnings call. I'm Ana Bartesagui, treasurer and IRO. Today's conference call is being recorded. As a reminder, all participants will be in listen-only mode. To ask questions during the Q&A session, ensure your first and last name appear on the Zoom platform. Questions can be asked by voice or through the Q&A box. Speaking today will be Patricio Superviel, our chairman and CEO, and Mariano Biglia, our CFO. Gustavo Paco Manriquez, Banco Superviil CEO, and Diego Pizzulli, CEO of Invertir Online, will also be available during the Q&A session. Good morning, everyone. Before we begin, I'd like to remind you that today's call may include forward-looking statements, which are based on management's current expectations and beliefs and subject to risks and uncertainties. For more details, refer to the forward-looking statement section in our earnings release and recent SEC filings. Patricio, please go ahead.

Thank you, Anna. Good morning, everyone, and thank you for joining us today. In first quarter 25, we introduced a cluster-based strategy to strengthen the value proposition across both retail and commercial customers to grain principality with our clients and attract new ones. Loan growth increased modestly sequentially as we experienced some short-term softness in loan demand, particularly in March. This was largely due to external factors including limited peso liquidity, currency volatility and caution ahead of the IMF milestone agreement. Reflecting our strategic focus, retail continued to lead, now comprising over half of our total loan portfolio, up from just a third over a year ago, and the score in our emphasis on higher margin, more resilient segments. On the funding side, deposits increase high single-digit sequentially. As the quality remains solid, our NPL ratio rose this quarter and is aligned with industry levels driven by the rapid expansion of our retail loan book and remains below historical levels as well within risk-adjusted pricing thresholds. Customer-related net financial income increased in the high teens, highlighting the strength of our core franchise, while market volatility weighed on invested portfolio name. On the cost side, we maintained discipline, strongly reducing expenses and demonstrating our ability to drive operational efficiency. In an environment with many moving parts, we delivered amid single-digit ROE in real terms. Mariano will discuss our financial performance in more detail shortly. Argentina continued to its agenda of intense deregulation measures. Inflation continues to decelerate while maintaining fiscal surplus. Foreign exchange restrictions were lifted for individuals and continued to be gradually deregulated for corporations. The strong show for the government in the recent CABA legislative elections demonstrate political support for the milieu government and is contributing to improve consumer confidence. Turning to slide four, as shared during our fourth quarter call, we finalized a strategic roadmap during this first quarter and began executing initiatives to position Supervial as a differentiated player, blending the strength of traditional banking with the agility of fintechs. At the heart of our strategy is meeting evolving customer expectations through simplicity, personalization, and convenience built on a resilient financial platform. We've already made progress on several high-impact initiatives. In April, we launched Argentina's first remunerated account, allowing payroll and SME clients to earn daily interest in pesos and U.S. dollars. This project enhanced the client experience while deepening our funding base and reinforcing our role as a primary bank. We are encouraged by the early response of our clients. This month we launched Tinder Super Villas in the MercadoLibre platform, a bank novelty, fully integrated into our mobile app. This marks a new step in our vision of our super app, providing customers a seamless platform to manage their financing, shop and invest. Our new AI-powered customer interaction via WhatsApp enables real-time intuitive support while retaining the option to access human assistance embodying our take and touch approach. Lastly, the bank launched an investment platform enabling its customers to conduct investment transactions powered by Invertir Online, delivering a frictionless experience and an avenue for higher fee growth. This initiative reinforced our competitive position and we are well positioned to support our clients and deliver long-term value for shareholders as Argentina enters a new phase of growth. With that, I'll turn the call over to Mariano Biglia, who will walk you through our financial performance and perspectives for the year.

Thank you, Patricio, and good day to all. Starting with slide five, total loans were up 3% sequentially and doubled year over year in real terms. Growth this quarter was almost entirely driven by retail lending, which rose 196% year on year and now represents nearly 52% of our total low portfolio, up from 36% a year ago and 48% at year end. This intentional shift toward higher-margin retail products continues to support profitability and deepen customer engagement. Commercial lending was up 58% year-on-year, but contracted slightly sequentially. reflecting softer demand from corporate clients amid tighter peso liquidity and cautious macro backdrop. That said, our market share remained stable and we are well positioned to reaccelerate in commercial lending as demand recovers. Turning to page 6, within retail loans, personal loans stood out up 29% quarter-on-quarter and more than quadrupling versus the first quarter of last year. Card loans followed, rising 12% sequentially and growing nearly six-fold year-on-year. In turn, credit cards rose 5% quarter-on-quarter and nearly doubled year-on-year. On the commercial side, loans declined 4% sequentially, mainly reflecting a decline in dollar-denominated loan demand in a context of strong volatility in anticipation of the lifting of FX contracts. Moving on to page 7. As anticipated, our NPL ratio reached 2% this quarter, primarily reflecting rapid expansion in written loans. While this marks a normalization from historically low levels, it remains in line with industry benchmarks and consistent with our risk pricing. the coverage ratio at 153% continues to reflect a prudent buffer. By segment, delinquency in the retail portfolio increased to 2.8%, while SME and corporate loans stood at 1.3%. Importantly, all levels remain within our expected range. Cost of risk rose to 5%, reflecting higher provisions aligned with retail loan growth in line with our expected credit loss models. As these loans gain share, we are actively refining our origination and collection models to sustain asset quality and protect returns. In our retail portfolio, we prioritize credit quality and long-term relationship value. Currently, 53% of loans to individuals are tied to payroll and pension accounts, segments associated with lower risk and stronger retention. Notably, 88% of personal loans and over half of credit card volume is sourced from these clients, underscoring the strength of this channel. 57% of retail loans extended to the open market are fully collateralized, mainly through car loans, supporting disciplined growth and enhanced credit quality. With respect to commercial loans, 27% of this book is secured by tangible guarantees and three-quarters of non-performing exposures are collateralized. Our exposure remains well diversified, with the top 10 corporate clients representing just 8% of total loans. Moving to slide seven, client-related net financial income rose 17% sequentially, reflecting the momentum in retail lending. loan portfolio NIM improved 60 BPS to 21.3% in the period, also benefiting from the growing share of higher yield products and a lower funding cost base. In contrast, a correction in bond valuations triggered by renewed FX volatility, together with a more restrictive monetary policy, resulted in a sharp decline in the investment portfolio net financial income. As a result, total net financial income declined 12% quarter over quarter. These trends reflect this resilience of our client franchise and validate our strategic shift towards diversified sources of income. Now, please turn to slide 10. In the context of a transition year, we're slightly adjusting our loan, NPL, and cost of risk targets for the full year. Starting with loans, dollar-denominated lending declined nearly 10% sequentially, while peso loans rose 6% broadly in line with industry trends. For the full year, we now expect to deliver real loan growth between 50% to 60% contingent on monetary policy. This compares to our prior perspective of over 60% growth retail loans are expected to remain above 50% of the portfolio. In terms of funding, peso deposits were up 12% sequentially, while dollar-denominated deposits were practically flat. We continue to expect 40% growth in total deposits for the full year, supported by a rising share of dollar balances and a strong traction in remunerated accounts, while peso deposits remain sensitive to monetary policy. On asset quality, we now expect the NPL ratio to range between 2.2% to 2.5% at year end, up from our original expectation of 2% and 2.2%, reflecting a higher weight of retail loans. Net cost of risk expectations now range between 4% to 4.5% compared to our prior range of 3.7% to 4% on higher share of retail loans. We also expect NIM to continue to normalize in the 18 to 20% range as inflation continues to ease, leverage gradually increases, and the mix shifts toward dollar-denominated loans and deposits. Turning to slide 11, we continue to expect fee income to grow by at least 10% in real terms in 2025. As discussed in our prior call, we anticipate fee income to be driven by higher net bank and brokerage fees, along with higher penetration of investment and insurance products across our client base. On the cost side, operating expenses were down 12% sequentially and 17% year on year, reflecting our focus on driving real-term reductions through workforce optimization and other initiatives. We expect this to further strengthen operating leverage as we continue to cut costs and drive revenue growth. As a result, we continue to expect ROE to improve progressively, reaching between 12 and 15% for the year, reflecting margin stabilization, stronger fee contribution, and the benefits of structural efficiencies. We also maintain our ERN CET1 ratio expectations of 12 to 13%, factoring in long growth and regulatory adjustments. In sum, we remain focused on disciplined execution, balancing growth, efficiency and capital preservation. We are closely monitoring the macro and regulatory landscape and are confident in our ability to navigate the evolving context and these emerging opportunities. Finally, additional details on our quarterly performance are available on the appendix of our earnings presentation. With that,