Banco Do Brasil Sa S/Adr

Hello, good morning, everyone. I'm Genaína Storti, Investor Relations Manager at Banco do Brasil. Welcome to our third quarter 2024 results live stream. Our event will be in Portuguese with simultaneous translation into English, and you can choose between three audio options, original, Portuguese, or English. Joining us today are our CEO, Tarciana Medeiros, our CFO, Giovanni Tobias, and also our CRO, Felipe Prince. Well, we will start our presentation with Tarciana, and then next we will move to the Q&A session. Since the beginning of this year, we have changed the format of our live streaming, bringing you the CFO's presentation of the results on the evening of the announcement so that we can devote more time to the Q&A session. This commented presentation is available on our Investor Relations website. Now, I will hand it over to our Chairwoman Tarciana. Thank you and good morning everyone. Thank you so much for joining us on our live stream on the results of the quarter. At this moment of interaction and dialogue with analysts and investors, I know that many journalists and employees are also joining us online. As you saw in the video we presented before our live streaming, culture moves us. It gives people an identity, promotes their development, creates bonds and boosts the economy. Banco do Brasil has believed and supported Brazilian culture for over 35 years. It's been more than three decades of uninterrupted support for the most diverse artistic expressions in Brazil and around the world, democratizing access to high-quality initiatives for the population. And it's also Bibi's culture, our DNA, that drives us in yet another quarterly results. Quarter on quarter, we have reinforced the management's commitment to adding value to our shareholders, clients, suppliers, employees, and the entire Brazilian society. And this is translated into figures in the statement of added value, which totaled 63.4 billion BRLs. Discipline in the execution of our corporate strategy drives the result that we are announcing today. of 9.5 billion BRLs in the quarter. This net income represents an increase of 8.3% year-on-year. It reflects the way the entire BB team works, with proximity, knowledge, and specialized attention to our clients' needs. I would also take this opportunity to thank my colleagues, both at BB and also in the companies that make up our conglomerate. I thank them for this collective and continuous development. We have more than 125,000 people dedicated to helping our clients fulfill their dreams or get through difficult times, fostering job creation, social and economic development in every country, every corner of this country. This is an example of our integration of the value chains and the participation of companies of the conglomerate in our total results. As you know, credit is undoubtedly an important pillar of our main business. We have been working with credit in an integrated and synergic way in all the markets where we operate, balancing risk and return. We exceeded 1.2 trillion BRLs in the balance of our loan portfolio. up by 13% in only one year. Credit disbursements in the quarter was over 160 billion BRLs. This figure stems from our commercial strategies, new solutions, process improvements, hyper-personalization of approaches and interaction with clients, in addition to financial advice to clients. For individuals, I would like to highlight 11.2% growth in payroll loans in one year with record disbursements for the period. You might recall that in previous meetings I talked about our strategy to grow INSS payroll loans. In the last 12 months, we've increased this portfolio by 21%, expanding our service to beneficiaries and offering them the best credit conditions. And we also made progress in private payroll loans. We reached 1.4 billion BRLs in this portfolio, up 23% in one year. And here we see a significant growth opportunity. We also expanded our corporate portfolio by 13.5% to more than 421 billion BRLs, which demonstrates our support to entrepreneurship, our proximity to large companies, and our strong presence throughout the value exchange. One of the highlights is the portfolio of micro, small, and medium-sized companies, which increased by 7% when compared to September 2023. Another highlight was the 14.5% growth in the wholesale portfolio, especially in the mid and upper middle segments. The government portfolio was up by 22.8% in one year. This portfolio is mainly focused on investment in urban mobility, health, education, public safety, generating effective benefits to the population and also contributing to the country's development. In addition, it's a very profitable portfolio. I would like to remind you that most of these operations are are guaranteed by the Treasury and has an excellent risk-adjusted return. The third important component of our loan portfolio is agribusiness. Banco do Brasil is the bank of agribusiness, and we remain so. We total 386 billion BRLs, up 13.7% in 12 months, driven by costing, which grew by 19% in the period, and also investment loans, which were up 16.5%. And speaking about agribusiness, I would like to go into more details about our work in the sector and the cycle we are going through. This quarter, delinquency rose by 65 basis points, reaching 1.97%. But with a highly qualified team that understands the segment in great depth, we are carrying out detailed mapping of the field, talking to our clients, we apply analytical intelligence, and also we have an extensive historical database and we call in our specialist we make we are trying to dialogue and understand the current context and more importantly we drop a plan to restore a healthy credit profile for our clients the first thing that this diagnosis told us and this is also something that I've been stressing for quite some time is that there is no crisis in Brazilian agriculture delinquency in our portfolio is not widespread Almost 80% of the increase is related to soybean crops, especially in the Midwest region. I mean, you see 98% of every business continues to honor, I mean, its commitments. Everybody is honoring commitments. We operate in more than 200 crops throughout the country. Every business is cyclical at this time. It is crucial to adjust the cash flow of some growers, adopting an individualized analysis and granting and settling loans. And I would like to draw your attention to something new, which is the in-court reorganization of rural growers. It's an instrument used by a few, but which has negative effects on everyone. And we have seen an increase in its representativeness. Today, we have 210 clients in-court reorganization status, which represents 0.01% of our total agribusiness portfolio. In the AgriPortfolios NPL, the in-court reorganization impacted around 15% of the overdue balance. Recently, our VP of Risk, Philippe Prince, said that in-court reorganization of rural growers is not healthy, and I would like to go further. The reorganization of farmers prevents them from getting access to credit, compromises confidence in the agri... agribusiness chain creates a rupture in the economic activity of rural women and men and impacts the cost for the entire segment. I would like to reiterate that we are and always have been close and relevant in the lives of producers and there are some structural alternatives including those provided for in the rural credit manual, which are more appropriate for getting through this moment rather than simply using the path of judicial reorganization. Agribusiness remains stronger resilient and will continue to be an important pillar of the Brazilian economy and the results of Bibi. While the 24-25 crop season is still in motion, we have a constructive scenario with crops representing an important price improvement improvement in margins with corn, coffee, and livestock. We expect to see a greater neutrality in the environment in the coming months, and our projections point to a growth of more than 5% in the agribusiness GDP in 2025. The strength of Banco do Brasil in agribusiness is is in disbursements of more than 97 billion BRLs in 275,000 operations. Moreover, we increase our share of disbursements in the system with resources equalized and compatible to the size of BB in Agri. And with that, we can certainly serve a large number of our clients. We also... you know, got new producers that were not no longer working with us in the last crop season given the competitive scenario. But in the long-term scenario, the use of biofuels will gain traction and productivity will continue in the field. Brazil will increasingly become a reference in sustainable agriculture and bioeconomy and the recovery of degraded pastoral lands. The demand for food produced in Brazil is growing. We will continue to be the bank of agribusiness, offering technical assistance, more encompassing solutions for credit, investment, consortium and insurance alike, All of that aligned to a purpose of becoming more revelating all the moments of their lives. And in fact, this proximity is not just to the agribusiness clients. but it extends to all of our clients and I will draw your attention to the fact that we want to offer one Bank of Brazil for every client the term hyper personalization has become a buzzword but BB is a pioneer in this movement and we have invested in developing models supported by analytical intelligence to conduct a more assertive and closer relationship today we are reaping the benefits of this strategy boosting business and generating value we might recall that here a few quarters ago, we announced the investment we made to enhance our CRM tool for a vision that is 360 degrees. This year, through this new platform, our expert teams already conducted more than 2.8 thousand personalized strategies for individuals and small and mid-sized companies, generating 475 million interactions And our MarkTech operation continues to evolve. 70% of the entire volume dispersed in loans for individuals from January to September 2024 was done through identified clients through our intelligence models and also hired by our CRM. This is a strategy that's fully digital, allowing efficiency and the scale of our digital channels together with specialized advisory from our employees according to the profile of each client and their channel of preference. Another highlight has to do with our excellence in terms of specialized relationship, where the human factor becomes our major differential, be it through physical or digital channels. More recently, our private and still segments, just celebrated their 20th anniversary two decades of trust and security now being with our customers from the beginning we have the largest high income network in the market we are the private bank with the highest capillarity operating in brazil and abroad this quarter once again with all of managed resources from clients from this segment we grew above a market average our still segment is present in all capitals of the country allowing us to deliver our differentiated value proposition, specialized per niche with investors, digital clients, and agribusiness. We also made progress in our personalized advisory service for investments with clients between 1 million and 5 million BRLs. Launched in August in the cities of Sao Paulo, Vitória, and Belo Horizonte, the high-steel segment focuses on proactive advisory services, you know, Wealth management and onshore and offshore solutions with the aim of increasing our market share investments with those clients. We hope to achieve 138,000 clients until the first quarter, the first half of 2025. Operating in a very hyper-personalized and specialized way and very close to our clients, this helps us to increase profitability. Profitability of our managed clients is almost 10 times higher than a self-assisted client. Moreover, NPS of BB grew 12% in the last two years, and for the ninth consecutive quarter, we are the bank with the least number of complaints. And now, moving to the last part of our presentation, I would just like to talk about some new things that are part of our ESG agenda. Bank of Brazil has been for a long time a protagonist in sustainability and the promotion of businesses and environmental and social practices and governance as well. And we're making great progress and we are now broadcasting live from our cultural center of Banco do Brasil in Rio de Janeiro, a unit that is part of our operation in terms of fostering culture. And it's from here that we will also operate during the G20 meetings. Our motto is we care, and that will help us to give voice, understand, and be a bank that takes care of people. In the last three years, we were able to fund over $36 billion abroad for investments in sustainable projects, and I would like to announce that we will engage in new partnerships in the next few days. Currently, we were one of the main funders of forestry and biodiversity projects, 1.4 billion BRLs in projects in the bioeconomic sphere in the legal Amazon. We are working together with small growers, associations, and co-ops. In addition to our social relevance, there is a direct relationship in terms of generating income.

Other important fronts of green businesses that we have been fostering are the products and services linked to originating carbon credits and sustainable agriculture and cattle grazing, besides recovery of degraded areas growing every day and giving our clients the financial feasibility to support environmental preservation. So to conclude, I would like to stress that the strength and robustness of Banco do Brasil. We are facing an important moment for agribusiness supporting and continuing to support the farmers. We want to continue to grow in agribusiness and other segments. We have delivered a consistent financial margin with a good diversification of income in the bank and in the groups businesses without losing sight of controlling expenses and necessary investments in the digital transformation. Besides that, our capital continues to robustly support our long-term ambition. Thank you for your attention, and now I will give the floor to Janaína to start our questions and answers session. So thank you. We will begin our Q&A session. You can ask your questions in Portuguese or English. We will be answering in Portuguese. Our first question is from Daniel Vaz from Safra Bank. Welcome, Daniel. Thank you. Good morning, Janaina and others. Well, first of all, I'd like you to talk about disbursements. in the third quarter, given that we are in the half of Q4, these disbursements could have been improved with the seeding season, especially what we see in soybeans. So my first question is whether this is really improving. And still about agribusiness, we see that we are in a more cyclical period, demanding greater performance. How should we consider the provisions for 2025? I know this is cyclical, but it has some drag, and it could go on for two or three quarters yet. So thinking about 2025, how will this impact, especially the beginning of the year? Thank you very much, Danielle, for your question and for being with us again. I will begin to explain the answer, and I will ask Pritz to supplement this. So we have, in fact... started a first month that was a greater challenge. We expected a higher disbursement, but right now we have reached the expected level of disbursements. We recovered the level from the same period of the earlier crop. So as I announced here, we have $100 billion in disbursements beginning with the SAFA plan, and we have two more months of disbursements for this year. So to answer the first part of your question, yes, we have recovered the speed of disbursements, which was coincided with the planting period for soy, especially in our safra plan or crop plan. So I will ask Prizi to complete my answer. Thank you for your question, Danielle. It's a pleasure to have you with us again. I believe that with these provisions, first of all, we need to think, and we publicized this, that in agribusiness, we have delays and drags. So what are we paying in terms of provisions? We are paying for the transfer of NPLs to... 1.97 basis points. So naturally, most of the pressure on the provisions has already happened. Our challenge now is to stabilize the NPLs and work on recovery. We have to highlight that this portfolio has more than 95% of linked guarantees. So its recovery is much higher than the other portfolios. when you combine the stabilizing of NPLs with the more robust credit recovery, then we will certainly have a smoother flow than what we are seeing now. which has culminated with our guidance revision. I also have a comment. There is a specific point reflected in this result, which are the RJs, or in-court reorganizations. If we look at this provision, considering the in-court reorganization cases specifically, and therefore consider we will have to provide a 30% provision. If it weren't for that, we would be at the 1.7 level, 1.7% level with our agribusiness portfolio. If the disbursements in July were faster and this didn't happen because of the rainfall, which was delayed, but the crops are already being planted and with expectations of record-breaking crops. And therefore, for 2025, we do expect to return to the normality. in terms of this specific portfolio and its provisions, around 1.7, which is our expectation. This is good to comment that when we isolate this effect from delays or drags, that is, new provisions, which we call the good type of cholesterol, is depending on the previous results of the crops. makes us reliant that we will be able to work very well at the end of Q4 and also along all of the year of 2025. Very clear. Thank you, and congratulations on your results. Our next question is from Olivia Fernandez from JP Morgan. Judy Fernandez. Thank you, Zana. Good morning to all. I will talk about the credit cycle because agro sees this worsening of the NPLs. We also see a drop in individuals and companies, businesses. And for next year, we see that interest rates will drop. remain higher for a longer period, and my prediction in this scenario is that we had a very bad cycle for credit in 21 and 22, so I believe the market's concern now is that it starts to worsen again. I would like to know the bank's vision after you have reduced your speed credit card portfolio is dropping for the last year, but what about next year? The increases we are seeing for the next quarter, do you think that they will also remain along the year, next year? And how will the bank prepare for that? And regarding the 496 law, 496, Could you share any numbers or figures with the market? Thank you, Judy. I will begin to talk, and then Prinspey will complete my answer. Well, regarding the physical portfolio, let's see some figures. Specifically regarding individuals, consignment loans, and others, and this is very much detailed in the report, we see a greater stability, especially also regarding payroll loans, especially with regards to the risk of this portfolio. We have lower NPL in this regard. And this impact, and this helps... small growth in our credit card operations. We are focusing on this growth for 2025, and we can go into greater detail later on this. But we see that the main part of our individual's portfolio is in payroll credit and loans. We had a very low default rate and a growth of NSS and private debt. So this is not a concern. Our greater drop or loss was in the renegotiable portfolios, especially some that come from a program called Disinghala. And We are very comfortable with this risk level and with ENPLs in our individual portfolio, and we do not expect any major changes for next year because the strategy, considering the higher interest rates and everybody working to close this year at 12% and maybe considering 13% or more for next year, Since our lines bring a very attractive risk return rate for the payroll, We will continue to grow and maybe close to 10% in 2025, and we will keep controlling the NPL of the individual's portfolio. It will remain stable. Now, with regards to the 146 law, well, yes, because we have the legal entity or the business entity, area also because we have to go back to the agribusiness and when you consider the corporate portfolio you have been seeing that it depends on the agribusiness chain so when you consider the individuals or corporate portfolios and you isolate the effect of renegotiated loans in individual and the specific operations in the agribusiness area, then the portfolio would either have a stable NPL or slightly lower than the earlier quarter. And we are very reliant with that and confident because we will be able to stabilize these portfolios with the agribusiness results and the provision that is caused by delays in agribusiness was $3 billion in the last quarter. So imagine taking that away from the behavior that we were channeling to the results. So specifically about the 4966 law, we are ready to turn our engines on in the beginning of the year. We are expecting this loss. Some actions are being done right now at the end of the year, and we want to reassure you that we will not have impacts on our results yet. resulting from the adoption of the RF-9 and the Rule 4966. And it's important for you to know that in our estimates with the implementation, we will continue to have a robust volume of capital above 11%. the core of it, and we will continue to pay dividends to our shareholders at 45% payout, irrespective of this implementation, because according to our estimates, we will continue to deliver robust results that support the growth of our business and that will generate revenues and income for our shareholders. Thank you very much. One last follow-up question about this comment. So do you believe we'll have any impact in capital? You already said that you're working above 11%, and even if there are operational impacts, and, well, we'll have many things happening next year, so you will remain with your payout, right? Right. Yes, this is the main message. Of course, we will have adjustments in the PL. We have sufficient income to cover this adjustment, but this will not impact our capacity either to grow and expand our business and to remunerate our shareholders. Well, we had already anticipated that the operational part is already considered in these projections. So we will have a very good year 2025. Great. Thank you to all of you. Our next question comes from Bernardo Gutman from XP. Gutman. We already have you, Bernardo. Yes, we can hear you. Good morning to all. Thank you, Jana, Tatiana, Giovanna, Principe also. Thank you for opening for questions. I would like to hear about the payroll loans a little bit more with the regulatory situation, repricing these loans. Is the bank reassessing its strategy for this segment? Do you consider an adjustment to continue to have profits? And if you could comment on the competitive scenario, especially with the new entrants. Bernardo, good morning. Thank you for your question and for being with us again. Speaking about the payroll loans, and its strategy. This is one of our greatest portfolios and strong points. So for 2025, I would say that back in 23 and 24, the government segment had increased their wages in all levels, federal, state, and local. So the bank, being the biggest bank in this segment, took care of that. So for 2025, with a new increase in wage, we will still have room to keep this margin for payroll loans. This means that our payroll loan portfolio will not suffer any impact, but we still have millions of clients to seek in this strategy as Giovanni has mentioned earlier one of the strategies is to offer the payroll loans to the private segments because we work with that in the government segments we know how to do it and it's important to know that in the private segments there are some nuances that we have been displaying in our strategy, so we will seek this portfolio, and it also depends on the SELIC interest rate. So it's also interesting to note that the competitive environment with banks is always there. Every 10 years, Requests for portability, for example, we are able to retain eight of them. Now I'm talking about the financial system as a whole. And when we mention payment institutions, we have not suffered any impact, any impact at all with regards to credit portability or migration of clients to other institutions. Important to mention that. Now my comments about the high SELIC rates And I think you wanted to know more specifically about the INSS payroll loans, which is regulated, right? Yes. So I would highlight that we have been working with a result that is adjusted to risk, to the return that this operation brings. And we act very differently from the market with regards to INSS loans. Our distribution structure is different because I don't have to pay the bank correspondent. With the INSS, our operations are mostly cash. performed by our own agencies, by our own branches that cover the whole country. So we have this good result. Another feature is that we have been monitoring the Selic movement, and if it rises again, the government will have to talk about the regulatory cap for Selic. payroll loans, but this is all in line with our results, with what we expect, so we will continue to grow in the INSS segment, and if we find any need, if there is any need for the financial system, the government will review the cap, and we already know that we are working with that possibility. It's also important to know that pricing considers the interest rate curve, which was already rising, and we already have this adjusted for most of our portfolios. This is a highly competitive segment, so we have to pay attention not only to the price that we need to use to continue being competitive, but also the cost to attract interest. these clients we were able to grow thanks to the portability attraction and if this spread becomes unfeasible for some reason then The same thing that already happened will repeat itself. You have the specific INSS committee that establishes the level, and when it grows too much, all the banks paralyze the portfolio, including our bank. So the structure is attractive. We are acting according to the curve. So we already made the adjustments in the curves. We have competitiveness. That's why we're growing. and we are maintaining our return adjusted according to interest rates. So we believe that we will continue to attract this, and we will be ahead of the competitors. Just highlighting the cost of this credit for us, which is infinitely lower than the rest of the market. Our funding costs also are different from the rest of the competitors, and this benefits us to offer credit. payroll loans. Another important thing, Tasia, is that when we mention payroll loans at Banco do Brasil, this means over 7,000 contracts with different public agencies. So we are certain that we will continue our situation even with higher competition.

great thank you very much okay let's move to our next question from Hannah to Negroni good morning good morning Hannah thank you for taking my questions I would like to revisit Prince's comment on the agribusiness cycle could you please elaborate a bit more on terms of how do you see things advancing going forward and when do you think that provisions will become more stable and it will start coming down and my second question a bit related to that and also in terms of the guidance since the beginning of the year the portfolio was aggravated and this should impact your financial margin but you you gross guidance was maintained your provisions increase and your net that income guidance was also maintained. What are the leverages that are in your business plan? Thank you, Renato. Thank you for your question. What's important here? Giovanna said something about it, and Tarsiana said something about it, too, during her presentation. Delinquency is very much concentrated in agribusiness, mostly in the soybean crops and in the Midwest. Soybean crops, I mean, it's not even... prevails in our portfolio because our major portfolio is with livestock and as you've seen the landscape for the coming years is quite favorable and then comes the soybean crop portfolio and they are facing some difficulties but the evolution of the safra plan or the crop season plan and the windows they were delayed but they are now becoming materialized going forward into the next season gives us the possibility of mean we didn't lose profitability but there will be a rebound in the entire process in terms of the soybean crop corn is also going through a favorable momentum because the margins are being reconstructed and rebuilt in the field so once you look at all of the indicators we see that the scenarios should be more favorable going forward so NPL would go back to normal levels. This is something that we have been telling you before. Today, delinquency is 1.97, which is higher than the level of normalization that we expected. But most of it was due to the court, in-court reorganization processes. And we've been telling farmers about it because this process shields farmers farmers in the market because since this is a very cyclical business it's constantly demanding more loans and farmers their resort to loans and the resort to in court reorganization they cease to receive credit and their production is halted so because of all of the joint guarantees I think going forward things will improve. And this certainly contributes to a reduction in NPL. And again, we may be able to see a normalization of the provision levels. We believe that if we are able to deliver all of these initiatives aiming at improving the composition of our agribusiness portfolio, NPL and provision levels will go back to normal. And I think that 2025 will be quite favorable. We see pressure, mostly related to 2024, in this crop, soy crop. And because of that, we had to make changes to our guidance. As I said, $3 billion. in provisions for this quarter related to delays or overdue payments in the agribusiness portfolio. If it were not for that, we wouldn't even need to review the guidance. But since we are very much driven by risk-adjusted returns, the risk was more than what we had anticipated in this particular portfolio. therefore we have 125,000 colleagues working hard to find profitability coming from order portfolios and so help us to maintain the guidance and I was just going to say I mean adding to what Prince was saying it's important to highlight that our portfolio is the dream portfolio of every bank because all of the portfolio mix is very very good I mean individuals in corporate in our portfolio is quite balanced so once we see a portfolio going through some difficult situation that marries our attention then there is another portfolio that helps us mitigate the other result but I think there is also important to mention one thing I mean 98% of our Agra portfolios are secured are secured we do not want any that's not what we want to to not help growers. I mean, we want to help them. We do not want them to be away from the credit portfolio. We have 210,000 customers in that Midwest region. So we want to go after these guarantees. And I also think it's important to highlight the work that we are doing to create awareness vis-a-vis the effects of the in court reorganization I mean to our business it's a different effect when it comes to corporate because farmers cannot take their farms and take it someplace else and start planting something else soybean growers will continue to plant where they are located in that geography and they will have to plant in the next crop season so all this work of talking to farmers, presenting the solutions that we have, even before they resort to the in-court reorganization, we are being very objective in our approach because this involves, I mean, this is a movement of predatory advocacy. We train our entire network for over five years. Now we have a specialized network operating with the agribusiness chain. Our contact with clients is not via WhatsApp or text message. We have a personal contact with the farmers. So our clients are being advised. They are receiving advisory services from an expert. So this part of our portfolio that is relevant, all the clients and farmers are being personally contacted contacted by experts from our own network it's important that that you understand that we are very serious in this regard we're talking to clients we are reorganizing their financials because we are advising them about the consequences of the in court reorganization to their businesses this is very important because this predatory advocacy You know, it hurts the entire industry because we are talking about short cycles. And usually the reorganization process is very lengthy. Unless that farmer wants to leave that business or maybe if he wants to sell the farm to a new farmer, he won't even be able to do that because he has to have a sound financial system. So we are already... talking to farmers because maybe they can renegotiate their debt and this has been approved by the National Monetary Council but many of them are now giving in to predatory advocacy this prophecy that involves explaining our clients about the risks and what that means that promise from lawyers trying to get them to to engage in in-court reorganizations is predatory. I mean, unless they finally decide to leave that industry because the crop season is coming, you know, rainfall is here, and if they resort to reorganization, they will be more or less sealed. It's important to realize that we're already seeing the benefits of the work we did. we saw this quarter a much lower number of clients resorting to reorganization. This is not something that we started last week. It started the moment we saw the first cases, and we understand that the benefits are coming. We have not received new cases of farmers resorting to reorganization in this past month. And this is an effect that does not only affect Banco do Brasil, but the entire financial system, because the client is... hurt through all over the financial chain now going back to the second part of your question how what are the the avenues of revenue I know that the provision level in agribusiness drew the attention of many people but it's important to look at the growth of our NII we are managing to grow loans and we expanded the margins even with the effect of Patagonia that led us to this growth of 9% if it were not for that we would have delivered 12% growth so our growth avenues are now being put in place in the fourth quarter because the year is not over yet our entire network is focusing not only in improving collection but also we are focusing on generating more revenue streams. We also have results on the fee income line. We also have a huge growth avenue coming from credit cards. So on purpose we put a halt on this line just to make adjustments. We had over 10% delinquency and today delinquency in that area for revolving credit in credit cards is something that we know we need. When we compare ourselves to private credit, we have two and a half times more volume with credit when compared to other peers. And also non-payroll loans. We are very strong in payroll loans, but non-payroll, which was another line where we were losing market share, we are now recovering that and there are now recent disbursements in October, which posted record numbers, of course, but if you look at risk and return, it's quite adequate, and this will certainly improve our margins going forward. So with all of that, in addition to expenses control, and that's why our expense guidance is lower. I mean, it's down, and we hope to save more to mitigate that hiccup, I would say, that comes from this new NPL coming from the agribusiness sector. Thank you. Thank you so much for the answers. Thank you, Renato. Our next question is from Gustavo Schroeder from Citi.

Good morning.

Good morning, Gustavo. Good morning, Tarsi, Giovanni, Princey. Well, let's change gears and talk about margins. I would just like to understand how do we look at the margin going forward? Your margins are very specific. I think in my reading, there are three different moving parts. You have client NII, market NII. And it started at a very high level with Patagonia holding things and market NII was also at a high level. These two last items were dropping in the past quarters until this last quarter and I was looking at the historical series. The lowest global spread. But if we look at the quarter, I think the main impact came from market NII and Patagonia, which was lower. But client NII improved. In terms of NIM, and at least when you look at the classifications, yours is a bit different. How can we see the NIM going forward? I mean, Patagonia, is it more along this level of 1.2 billion or 1.1 billion? Market NII close to 5 billion. And client NII, I think, had a positive outcome. But in terms of NIM and looking at the margin going forward and thinking about 2025, know considering all the information you already have about Patagonia plus probably if you could give me more information about market NII and client NII thank you Schroeder first of all we believe that both margins are important we've had very specific strategies at Treasury and And that has given us positive results. But now, looking at client NII more specifically, you might recall that today, I mean, among the banks, I believe that we have the best funding cost. And this gives us freedom to grow in lines like payroll, for instance, as Tarsi already said. But there is one very specific line where we were probably lagging behind. We were lagging behind vis-a-vis our private peers. And this is non-payroll we lost market share there and also in terms of revolving lines for the credit cards now looking at this margin going forward what we believe is that what will bring us higher growth in a higher margin gain this will come from lines with higher margins is this 4.9 of NIM The expectation is that once we manage to balance, like one-third, one-third, one-third, one-third corporate individuals and agribusiness, once we look at the individuals mixed, we will try to recover our market share in non-payroll, and we want to grow in private payroll, which gives us greater margin. And if we grow in credit cards as well, we will be able to improve that spread or the NIMs, keeping an eye on the risk of course we don't want to be surprised with what happened in the recent past with that open ocean just give you an idea 120 million no account holders but today you have approximately only 25 million that in fact frequently user credit cards and we call these clients know clients of active with active credit cards so there is a huge ocean of clients that have either debit or credit cards and only 20 some million that are heavy users of these cards we have a huge ocean to take a deeper dive we are segmented in PFA but we have high C high D or high equity and we could take a deeper dive with those clients so we can invest in a new onboarding. That was a journey with a lot of friction. Therefore, we've revisited our onboarding this year. Therefore, we believe that for next year, we believe that we will continue to grow that portfolio. And, you know, looking at Selic, Selic will be higher probably going forward. But even then, we believe that we can be very competitive due to the fact that we have a lower funding cost and also other lines with a higher spread. So, going forward, if Patagonia remains as expected within a normal level, and that drop in Patagonia was expected, it just took some time to occur. But you had the drop in interest rate, drop in inflation, FX. Now, all of that had an impact now, but we believe that looking to 2025, that NIM will be better recovered. I think you mentioned something very important. I mean, we lost market share in the non-payroll portfolio and the credit card portfolio because we still had some homework to do. We had a hiccup of delinquency in these two portfolios, and we understand that. We understood, therefore, that our risk models were not adjusted enough to allow us to go into the open sea. And even those 40 million non-tradable clients, but we understood the profile of the client level C, D, and E. That was a segment that we were looking more carefully. So we Put these segments into a cluster. And now we have a very interesting profile per client. As Giovanni was saying, we have approximately 24 or 25 million clients which are heavy users of the credit cards. But there is also another universe of over 60 million clients that could negotiate with us, that could operate with us. and could probably use credit cards. But we are very rigorous in terms of our risk analysis. Therefore, I firmly believe that this will be one of our good avenues of profitability going towards 2025. Just to conclude, I think the third quarter already brings a proxy of that strategy. If you look at NPL for individuals, it's slightly up. But if you look at it in depth, it's mostly concentrated in that renegotiated portfolio, meaning that we already expanded non-payroll credit this quarter with better cohorts, and the risk is extremely adequate to the returns coming from this portfolio.

And Schroeder, just to conclude talking about margins, we talked about the funding credit, but we must also not forget about the Treasury effect. Even with the drop in Patagonia, the Treasury looking at the bank in isolation shows a very important growth in this sector. And with the important effects in terms of liquidity and interest rates that flow into the bank, all these elements contribute and bring a positive load for us for our 2025 margin. Very well remembered because in funding, most of it is practically in what we consider 5% to 6% in terms of savings and legal deposit and hedged. So we have a good margin also on that. And we have some expenditures that are investments also. So for 2025, everything we're talking about here involves technology, embedded technology, AI, generative AI, IA. So... We will never stop investing in the bank's growth and in also dedicating more people to help the client and to do businesses. So all the processes that are standardized, we will use more intelligence in them so that we can gain in intelligence and efficiency. This is all very clear. Another fast Question about the tax rate that were lower now, that was lower now. Any explanation about this rate? Well, we were already providing some soft guidance that the tax would be around 20%. It might come closer to 18% when you look at the whole year. But we have three basic effects that explain this tax rate. First of all, the events that happened in Argentina, you see a tax loss there. We had to look for these tax credits. And when we consolidated Banco Patagonia with Banco do Brasil, this brought a reduction in 600 million reais approximately. Another effect that also dropped are effective... tax rate of around 45 million was the JCP not only the TJLP but also a larger credit base with that we paid more dividends or JCP and this dropped slightly the volume in our tax base and finally some specific cases individual cases that happened abroad losses that led to drops and this happened in the beginning of the year but we still need to wait for some reports that are coming from abroad that will show us the possibility to recover these losses or not and after the reports were approved abroad we had to acknowledge These losses coming from abroad, which is equivalent to more or less 500 million reais. So these are the three main effects that caused our tax rate to drop to this level this quarter. But considering the whole year, you can expect, because of these effects, a slight drop. from the 20% we were expecting to the 18%. That's more realistic. Now let's go on to the next question. Eric Iquito from Bradesco Bank. Hello to all of you. Thank you for the opportunity. I also have two questions. The first, when you mentioned the NIM, especially with Patagonia, And considering the best results from Patagonia that were close to $1 billion, but the tax rate came from a benefit. So if we consider 20%, the profit from Patagonia would be $500 million. Do you think this has already normalized, or could we expect some more effects from Patagonia? and rapidly the increased basis points of the SELIC in your margin. And another fast question, which is, what is the IRA, the sustainable ROI you expect in the long run? Well, thank you for your questions. It's very hard to try to estimate what's coming from Argentina, but, of course, we believe that a sustainable ROI level from Patagonia would be from 500 to 700 million. That's been our guidance. So I think your estimates are very much within our expectation. Also important to remember that we're talking about liquidity here. So on the one hand, you had a drop in the interest rate that impacted the results of Patagonia. But on the other hand, there is the funding cost because According to the government, we had to remunerate 5 to 10% of their basis rate. Now we were able to adjust this spread. Almost no exposure to credit. So it's mostly given the treasury and the macroeconomics of the country. Now considering that the policies that were adopted will bring their economy to normal levels, It's still being treated as a hyperinflationary economy, even with a drop in inflation to 4% a month, but it's still being considered a scenario that is very hard to predict. That's why we've been focusing strongly on the Brazilian side of the businesses. Now, specifically on the NIM, we do see opportunities not only in the growth of credit with clients, but also in treasury gains. And with regards to sensitivity regarding interest rates, we have to see the gains and losses. On the losses, we also have the increased risk. interest rates, and that would give us a gain over this funding. Of course, the long-term deposits are adjusted because they are post-fixed, but we have the pre-fixed, which is mainly from savings and deposits. This also brings positive impacts, but we do not see major changes considering the basis points, CBIPs. The yearly impact, I would say, is very marginal while you can see it in specific periods. Now, your other question about a sustainable ROI for the bank. We are still not discussing our guidance for 2025, but we believe that the ROI around 20%, which would be, around the 20 percent or the high teens, that would be very healthy and sustainable for our bank. And now I don't know if one of your questions was unanswered. No, you got all of them. Thank you very much. Our next question comes from from Bank of America. Good morning to all of you. Thank you for the opportunity to be here. I think most of the questions have already been made, so I have a difficult question. If you change your guidance for this year, you still left a very large range, and that would be $7.8 to $10.8 billion for Q4, and we only have one and a half months to end Q4. So when we look at your guidance, do you see a scenario with higher provisions for Q4? And the same question goes for the net revenue. Your range is very wide, very big, and we could see maybe $11.7 billion to That sounds very low because you're generating $9.5 billion per quarter. So what is your level of confidence in the new guidance? Thank you, Mario, for that. Although we are still in the middle of November, we still have one and a half months to the end of the year. And as I've been mentioning here, most of our operations come from agribusiness. So that segment, different from the other operations, have a unique deadline. So when the client regularizes, he regularizes the whole operation. And with that, we have a softening of our prediction flows. So we're working very strongly on calling the farmers to regularize their situation so that they can improve. get new resources for the new cycle and with that we will have payments turning to buffering or repayments. So although we still have 45 days to the year's end, we have a range to present to you because we are confident that this work will be well done and it will result in a more stable flow of provisions. And obviously, we do not expect a higher flow than what was delivered in Q3. Princy, I think we should also highlight that in this first month and a half this quarter, we saw a greater activity in reorganizations. So as I said a while ago, this week, and The quarter is still ongoing, and this week we can already see this stabilization happening without any new regularizations or reorganizations, but we are also paying attention to what happened in the beginning of the quarter. We don't expect this number to grow by the end of the quarter, and this is in line with what we are saying. And now this leads me to another comment. Thank you very much for expecting a level at the size of Banco do Brasil, between 9 and 10 billion, because I always said that we would expect to equate the level of the bank. So that shows we have been having very good results. And it's good that you are demanding that we maintain our results between 9 and 10. That's very good for us, very productive. Thank you very much, Mario. We know you are good with numbers. And without a doubt, I've been giving you some clues about this. The non-payroll loans disbursements have been reaching record levels. Just to give you an idea, we are disbursing almost twice. the year average and this will help us to close the gap and the range well I do not agree with you in that our range is 3 billion from 37 to 40 31 to 34 and that's the range or the margin we have of course we focus at the center of the guidance we can go to one end or the other or end in the middle but it's like a basketball game Mario it only ends on December 30th because 31 is a holiday and preferably with a three-point difference. So we have this three-number or three-grade estimate. That's good. Our next question is from Carlos Gomez Lopez from HSBC. Thank you very much. do this in Portuguese, about the agro portfolio for clarity. This is a strategy of the farmers, not of the bank. So my questions are, first, what is the coverage of the portfolio that is concentrated right now? When can we expect guarantees, if necessary? And how can you secure this? Because if you have a concentrated portfolio, you will depend on more social policy. So do you believe that you can insert 99%? And for how long? Another question about the 4966. It will impact item number one, which in your... We see 80 basis points. Is that the approximate number? Thank you very much, Carlos, for your question. Regarding the coverage of the portfolio, it's still very healthy, almost 170 percent of coverage for the agribusiness portfolio, showing that it is quite resilient because We started at 1.5. Now we have a 1.97 NPL. And the coverage is used for these stressing moments so that we can cover everything smoothly without further impact to our results or performance. So we're very comfortable with this coverage. It gives us the capacity to continue facing stress. the event of NPLs or delinquencies in agribusiness and once the delinquency drops the coverage will be recovered and we will go back to the levels of around 200% which is satisfactory for us in periods of portfolio instabilities. Now with regards to guarantees that's a very good point. we have been quite emphatic in our negotiations with farmers that we will use and explore our rights and we have a very big legal action that is the farmers that have not come to us to renegotiate and which are in delay We are anticipating the execution of these guarantees, and this brings an interesting effect. You will not necessarily recover the credit. Many times when you pressure for a guarantee, the farmer will come back to you, renegotiate, and pay you. for his default. So this is very important. We identified that these processes needed to be faster and more aggressive, and this is exactly what we've been doing. We favor the client sitting down with us to renegotiate, but those who do not renegotiate and who incur in delays we will apply our guarantees to them and that's what we are already doing. You will see that the bank will be very active in this sense and obviously this will favor our recovery and it's part of our stabilization plan for this flow of provisions as a whole. As for the 4966 rule, we've been very clear Here it will not impact our results, and the impact that will be caused in our capital, we're not advancing any numbers, but as Giovanni mentioned, eventual impacts will make our capital continue in very healthy levels above 11 percent, and that will be our smooth line. So I'd like to know about the coverage for your soybean portfolio. What is the level of coverage? Because you have 30% now, and then we had 60%. Well, the coverage for the soybean portfolio is very similar to the rest of the agri portfolio. Since it is the crop that has been causing the greater delays, it has the greatest volume of provisions. So it ends up acting like a proxy for the coverage of our whole portfolio. Now, if you're asking about coverage in guarantees, it's the same percentage. Ninety-nine percent of the portfolio counts with actual guarantees or guarantees that mitigate risk. And this will help us to be more active and straightforward in seeking to recover those credits. Thank you.

Thank you, Carlos.

Now I would like to invite for the next question, Pedro Leduc from Itaú.

Pedro, are you here? Yes, thank you for taking my question. I have two very key questions. First, in terms of the renegotiated portfolio, I think the portfolio... is growing above their total portfolio. Delinquency is rising. Do you see anything more impacting here? And how do you see this advancing vis-a-vis the total portfolio of the bank next year? And the second question is about the legal risks on your expense line. There is more volatility. I would just like to hear your views about how this will evolve going forward. Right, Pedro, the renegotiated portfolio, of course, it bothers us, but it's still at acceptable levels, especially if you compare it with the market average. Well, certainly all of this pressure in agribusiness ends up at the renegotiated portfolio.

Moreover...

you have to consider two risk mitigation process that we had in our two other portfolios. The first was the OpenSea, especially non-payroll and credit cards. And this was also part of the Dizinhola project. And the other issue was credit to SMEs. In the first half of the year, we were working diligently to reduce the risk coming from these two portfolios. Therefore, it's natural I mean, especially because Banco do Brasil did not, I mean, did not spin off any active portfolio because our portfolio is very clean. We did not give that out to third parties. So you have the carryover from these previous process. And in addition to that, we have the agribusiness scenario and we've been talking extensively about that today. So what do we expect and what we are doing now for 2025? The recovery of the agro portfolio is much more favorable also because we have risk mitigators and guarantees and they are linked to one another. Once we have a renegotiated portfolio that has a heavier weight coming from agribusiness, it's very difficult to compare because given the moment of agribusiness in the past five years, our renegotiated portfolio, I mean, was kind of lacking credits from agribusiness. Once we have incorporated that credit, it's just natural that our recovery is better. And once that recovery is better, we also believe that not only growth of the portfolio will be more stable in 2025. We will consider the non-growth of the renegotiated portfolio, but there is another thing that we seek, and that is the reduction of delinquency. If you look at historical levels, delinquency of the renegotiated portfolio is higher than expected, and we also believe that there is great potential us to collect we are engaged in a very active collection process because of the aim is to reduce delinquency and finally we are now doing what we did back in 2020 and maybe in 2025 we would also use some strategy to pass through some of our active portfolios we haven't been doing that in the past three years but depending on the portfolio and the likelihood of recovery well of course once you respect all of the returns from the market in terms of acquiring part of their portfolio we could also make use of that strategy oh you also talked about legal risks that's something natural there is a stronger move from the judiciary in the second half of the year. So the process, the judicial cases are being solved. But what are we doing internally? We are trying to quote-unquote sanitize the demands. I think recently the Supreme Court issue a ranking and Banco do Brasil is seeing a reduction in the number of lawsuits because this is very much in tune with all of the agreements we are making. Our mantra is that the agreement reduces risk and financially speaking it is better for us to engage in an agreement early on in the lawsuit. And President Tarsi also mentioned that. It's just natural that once you engage in that strategy, you will see a slight increase in the legal risk. But in terms of the sub-guidance that we've been sharing with you, the good news is that once we do that, We are now cleaning our balance sheet for the future. And the outlook, therefore, becomes very positive. Thank you, Prince, and thank you all. Thank you. Our next question is from Eduardo Nishio from Genio. Good morning, everyone. Good morning, Tarciana, Janaína, Giovanni, and Prince. I would like to revisit two topics.

First, how do you see the dynamic of the quality of the assets in the next quarters?

Looking at the guidance, this means a reduction for the next quarter I mean maybe you're looking at the middle of the guidance I mean 10% going to 9.9 billion so I would like to hear from you what you see in terms of NPL with this backdrop you also talked a little bit about each line Corporate, I think you have some issues with agro. Individual, some stability. So how do you see delinquency trajectory? Because if you look at a chart and look at the trend, NPO is increasing, and it's been increasing for quite some time, and it's back to pre-pandemic levels with a cost-to-income ratio in this quarter relevant. I think you have the impact of Americanas because that consumes a little bit of that. But if you talk a little bit about the asset quality, I would appreciate it. My follow-up question has to do with tax. I think Giovanni mentioned something like 18% taxes. 18% will mean a relevant increase in the tax calculation. Do you still have an interesting potential of interest on equity that should probably increase your tax rate probably close to 20%. Do you see the possibility of being any lower than 18%? Because according to my calculation, you would have some room unless the fourth quarter is more heavy on the tax side. It's heavier on the tax side. Let me start with your last question. Well, we don't give guidance on on taxes but I think you can work around 18% or maybe the range would be between 15 and 18 that would be that would make more sense in terms of allowance for loan losses I think we are around 26 million we adjusted the range and to be in the middle of the range would have to be around 35 so we are saying something between 9 and 10 if it is 10 of course that this will also depend on how the agribusiness sector is performing and then I would be close to the middle of the guidance and going to the higher side well we still have to work on that I wouldn't like to say anything for sure It's like a basketball game until the last second you were still trying to score points. I mean, you either control expenses, look at the revenue, or you have to address the issue of provisions. But now I'll turn the floor over to Prince. Nishiu, you have to bear in mind that the transition of the NPR or delinquency was higher this quarter. So this transition is what carries the ALL, and that's why we had to change the guidance, and that was the $3 billion I mentioned. I mean, if you look at the other portfolios, and if you exclude the renegotiated portfolio, in every single one of them, our origination cohorts are more favorable, and they are bringing lower returns. ALLs or the good cholesterol meaning that we are originating better assets what happened is that this quarter there was a transition coming from agribusiness which was quite strong this led to higher provision expenses because of that that delay but our challenge is to control delinquency now but what you have to bear in mind that you know, for the fourth quarter and for 2025, is that we will not see a transition in LPL in the magnitude we had when it was half and it went all the way to 2%, so it will be amortized going forward. Not only that is natural, but that also involves all of the efforts we are putting to mitigate the risk, and this starts with an ALL guidance that we will deliver now and it has to do with our projections for 2025 that you will soon see. I mean, NPL has been increasing for quite some time, but I would like to see it differently. Credit card. I mean, NPL is flat and balance is not growing as much. Why is that? Because we chose to remove the risk from that card portfolio and now we have the possibility to engage in a new cycle with a very resilient and profitable portfolio unlike the previous cycle when we started with a small portfolio and we were underwriting the risk I mean beyond what we should but now it's different we have a robust and resilient portfolio and we are very confident in the tools that we have to advance in the segment. And this starts with non-payroll. I mean, in the payroll loans, delinquency is stable. To summarize, I mean, individuals, delinquency comes from the renegotiated portfolio. This was an expected event. Therefore, we shouldn't expect new delinquencies for 2025. What we should expect is that the individual's portfolio will have Risk-adjusted returns, totally adjusted, contributing to our results. And the same thing goes for the corporate portfolio. If you exclude the effects of companies related to the agribusiness chain, we should be able to see a stabilization in delinquency of corporates. And this has to do with what we said in the first quarter. We will dedicate efforts to stabilize the NPL of our portfolio. you know, mid to large size companies because we also believe that if we work with the productive chains and if we work with the principality of our corporate clients, we will be able to deliver a performance better than what we had before. And if you exclude the effects from the renegotiated portfolio, this is something that we are already delivering. And agribusiness is everything we said before. once I stabilize delinquency from the agribusiness portfolio I would have savings of three billion per quarter I'm just trying to be very objective and I'm trying to connect the dots and the members to facilitate your understanding so we still have great value to capture throughout this journey towards you know stabilizing delinquency from agribusiness but Once delinquency increases, it's a part of the coverage. I mean, coverage is done for that so that in moments of unfavorable cycles, it's important to have some cushion, some buffer that can... mitigate the effects and give us the possibility to go through the cycles. And this is what we are doing with our coverage. We are prepared to face new cycles, both on the individual and the corporate side. And once the agro cycle is solved, coverage will recover and then we will be able to fund our growth in 2025. The message is that once agribusiness is stabilized, the outlook is very favorable for the performance of Banco do Brasil's portfolio. It will be favorable in terms of our provisions, and as a consequence, we will be able to deliver better results. Thank you very much. so now we will go to our last question i would like to to call in hiki navajo from santander the floor is yours thank you janaina good morning good morning it's very good to talk to you my question is about 2025. i know that you will only give guidance in the fourth quarter and i understand this guidance will be in br gap but looking at 2025 the macro scenario day becomes more challenging there is the issue of the agribusiness I mean the the in court reorganization is a tool that large growers can resort to but there is also the fact that mid and small sized farmers they cannot resort to the in court reorganization there is also the issue of the 4966 I understand this transfer balance will not impact our results. But looking at 2025, the portfolio that is being originated will certainly require higher provisions. And finally, when we look at 24 and 25 combined, 24 was very strong because of Patagonia. So where do I want to get with all of that? If we look at Bloomberg numbers, consensus numbers, it suggests flat net income for Banco do Brasil for 2025. And it it's not rare to find investors that believe in a drop in profits from Banco do Brasil in 2025. Is there any scenario where we could probably say that Banco do Brasil will experience an increase in net income? And where would that increase will come from? Okay. Certainly, when we talk about an increase in net income for 2025, I mean, I think it's too early to say anything because we're still reviewing our budget and what would probably sustain our guidance to be disclosed. But your reading, in a way, is correct. But I would see the other part differently. Well, certainly, Agro, as Tarsie was saying, there is no crisis. With small growers, things are normal. There are some one-off cases involving just a handful of clients, and we are working with them regularly. you know, to prevent any spread. But now, in terms of how we can deliver the results for 2024 with the 4966, your reading is correct. The new concessions will demand at origin provisions that eventually we wouldn't do if you take a AA credit, for instance. But as we manage to expand our credit card portfolio or non-payroll that will bring margin. And if you compare that with 2024, that means that we will be changing the mix in an environment of higher interest rates that also favors margins on the funding side. Therefore, we will be able, in our view, to deliver not a double-digit growth, much to the contrary, but a single-digit growth. Now... wouldn't say that it will be a high single digit or in the middle I think we have to be very cautious precisely because we have to go through this moment of finding out how we are going to deal with provisions for the agribusiness portfolio maybe you could add something related to this new methodology you know you know provisions you know they rise using the elevator and the rest uses a escalator I mean it's very important that we take a deeper look at the difference of our portfolio I mean your diagnosis about the reorganization is perfect and why do we believe that there won't be any reorganization with small growers there is no delinquency or default coming from the small growers there is no crisis in agribusiness farmers that are in good financial health they are making money and there is no delinquency in our you know small mid-sized farmers and in the past they were the first ones to struggle but there is no default or delinquency in this segment and that's why we don't see reorganization among these farmers because there is no delinquency and with the 4966 even though with unsecured transactions you require higher provisions you have to see that the minimum requirements you know required by the central bank they also allow you to have a lower provisioning of the secure portfolios and these are predominant portfolios in you know, in the bank. So you should not compare Banco do Brasil with other financial organizations because our portfolio is different and it's more secure. Once it's more secure, even if it's unsecure portfolios, you know, I probably see, you know, expected losses. But in the secure portfolios, I will not have many losses and once you balance that not necessarily I'm not talking about the transition I'm talking about the business in place not necessarily means that you will have a pressure on the provisions of Banco do Brasil and with that we understand that we are fully capable of delivering good results in 2025 and in this regard it's interesting Prince because In 2024, many analysts were saying, no, no, pick your earnings. But we challenged ourselves because we wanted to deliver a high single-digit growth. But we believe that by the end of the fourth quarter, we will be able to deliver that growth. But for next year, we will also discuss that. And I wouldn't be surprised because a lot of people talked about flat in early 2024 or even a drop. net income this is not what we are seeing and the possibilities or the avenues we have to generate results going forward are great we have a lot of catch-up to do we have to recover market share we have to generate more results in more business and part of our customer base can be further exploited we can improve principality we can generate more business

to deliver in a more challenging environment certainly will be more challenging with higher interest rates but we already experienced that in the past and even then we were delivering good results I would like to comment on something which is quite intangible which is our commercial strategy and we made an investment and we were having good results in a new platform So we've been announcing this along all the quarters, but now we implemented a new CRM platform, and we have over 2,850 new models that have been created by our experts, generating over 480 million interactions with clients. Interactions means contact. That is, the client saw us. received and interacted, reacted to our communication. And the new CRM platform is a big opportunity in this sense. And one result is already observed, which is that we had twice of non-payroll loans And for 2025, we can advance that we will expand our specialized network. We've been investing on this for the last five years. We have been doing this with these models for 20 years, but they have been enhanced and modernized. So we have specific models for each model. profile of clients, so investor, investor, agribusiness, farmer, investor in agribusiness, and others. So for this specialization model that we've been investing in for a long time, we will continue to do so in 2025, even more so. So I've also been talking a lot about digital so for next year you can expect the bank to be increasingly more digital giving to clients what they need exactly and it brings efficiency another point we want to stress are the new I8 models we will bring new I a model all of them supported by our investment in technology and beating out good digital change and it doesn't mean that we were not digital before but we have been investing in the process for a long time so this beating up will come and be available for the client when they need it in whatever channel They prefer. It might sound like a cliche, but when we say we want to deliver a bank for each client, this is a strategy, and it brings results. It's according to each client's needs, and we want to use efficiencies coming from automation of processes to have an increasingly expert network focused on the client's needs and businesses. So when we bring the results, the numbers do not capture this very well, but we have been seeing an evolution quarter after quarter in our models, the commercial models with the clients. I think it's also important to bring this up and to anticipate the continuation of this commercial strategy into 2025. Thank you very much, Navajo. Well, I would like to thank you all for your participation. We are closing our Q&A, and we will still be around. at your disposal for any additional questions you might have. And we hope to see you again in our next result discourse.