Company Presentation · 2021. 3. 3. · 2,1 1,4 23,2 27,9 12,5 8,2 1Q20 2Q20 3Q20 4Q20 ROAA ROAE...
Transcript of Company Presentation · 2021. 3. 3. · 2,1 1,4 23,2 27,9 12,5 8,2 1Q20 2Q20 3Q20 4Q20 ROAA ROAE...
PresentationCompany
March 1, 2021
J.P. Morgan 2021 Global Emerging Markets
Corporate Conference
Disclaimer
This presentation contains certain forward-looking statementsthat reflect the current views and/or expectations of GrupoSupervielle and its management with respect to itsperformance, business and future events. We use words suchas “believe,” “anticipate,” “plan,” “expect,” “intend,” “target,”“estimate,” “project,” “predict,” “forecast,” “guideline,” “seek,”“future,” “should” and other similar expressions to identifyforward-looking statements, but they are not the only way weidentify such statements. Such statements are subject to anumber of risks, uncertainties and assumptions. We cautionyou that a number of important factors could cause actualresults to differ materially from the plans, objectives,expectations, estimates and intentions expressed in thisrelease. Actual results, performance or events may differmaterially from those in such statements due to, withoutlimitation, (i) changes in general economic, financial, business,political, legal, social or other conditions in Argentina orelsewhere in Latin America or changes in either developed oremerging markets, (ii) changes in regional, national andinternational business and economic conditions, includinginflation, (iii) changes in interest rates and the cost of deposits,which may, among other things, affect margins, (iv)unanticipated increases in financing or other costs or theinability to obtain additional debt or equity financing onattractive terms, which may limit our ability to fund existingoperations and to finance new activities, (v) changes ingovernment regulation, including tax and banking regulations,(vi) changes in the policies of Argentine authorities, (vii)adverse legal or regulatory disputes or proceedings, (viii)competition in banking and financial services, (ix) changes inthe financial condition, creditworthiness or solvency of thecustomers, debtors or counterparties of Grupo Supervielle, (x)
increase in the allowances for loan losses, (xi) technologicalchanges or an inability to implement new technologies,(xii) changes in consumer spending and saving habits, (xiii) theability to implement our business strategy and (xiv) fluctuationsin the exchange rate of the Peso. The matters discussed hereinmay also be affected by risks and uncertainties described fromtime to time in Grupo Supervielle’s filings with the U.S.Securities and Exchange Commission (SEC) and ComisionNacional de Valores (CNV). Readers are cautioned not to placeundue reliance on forward-looking statements, which speakonly as the date of this document. Grupo Supervielle is underno obligation and expressly disclaims any intention or obligationto update or revise any forward-looking statements, whether asa result of new information, future events or otherwise.Statements about the effect of the Covid-19 pandemic on thefirm´s business results,, financial position and liquidity as wellas on Argentina and worldwide economies are subject to therisk that the actual impact may differ, possibly materially, fromwhat is currently expected. Unless otherwise indicated, allfinancial information of our company included in thispresentation is stated in terms of the measuring unit current atthe end of the reporting period.
Contents
Q&A
Macro & Industry Trends
SUPV Highlights
Contents Macro & Industry Trends
4
CHALLENGING MACRO FURTHER IMPACTED BY COVID-19
70
120
170
jun.-17 feb.-18 oct.-18 jun.-19 feb.-20 oct.-20
Economic Indicator (MoM var)
Industrial Production
Favorable base effect and better external conditions may help in 2021….
…while Government showing signals of fiscal restraint for 2021…
…fiscal deficit financed byhigher monetary expansion and issuance of
treasury bonds in the internal market…
50,0
70,0
90,0
110,0
130,0
150,0
170,0
F M A M J J A S O N D J F
FX Blue Chip Swap Rate
As of February 26, 2021Source: BCRA, Bloomberg
67% gap
…while the gap of the Blue Chip Swap rate vs the FX rate continued at a high level……
-6.4-4.5
Jan Feb Mar Apr May JunJul AugSep Oct NovDec 2021( e )
… putting pressure on recent monthly inflation and in expected inflation for 2021 …..
52,9
50,348,4
45,643,4 42,8 42,4
40,7
36,6 37,235,8 36,1
38,5
50,0
2,32,0
3,3
1,5 1,5
2,21,9
2,7
2,8
3,8
3,2
4,0 4,0
Jan Mar May July Sep Nov Jan
YoY Inflation Monthly Inflation
Source: Monthly Inflation – INDEC, REM BCRA January 2021
1.6931.860 1.941
2.168 2.181 2.1492.304 2.329 2.313 2.319 2.338 2.425
2.582
26%38%
48%64%62%60%
67%77%72%67%
49%40%
53%
Jan Feb Mar Apr May Jun July Aug Sep Oct Nov Dec Ene21Monetary Base YoY avg growth
Source: Company Estimates based on Minister of Economy Information2021 ( e ): Budget. Ministry of Economy
Source: BCRA
Fiscal Deficit / GDP [%]
Source Indec. Base 2004. As of December, 2020
5548
40 3837 3844
19 2427
303236.5
J F M A M J J A S O N D J F
Leliq Repo (1D) Repo (7D)
….and interest rates remained unchanged and set by the Central Bank…
Dec 30, 19 – Feb 24, 21Source: BCRA
Favorable external conditions could help in 2021
5
INDUSTRY LOANS EVOLUTION
AR$ system loan demand expanded slightly above inflation in 4Q due to increase in credit cards and in loans at subsidized rates
Loans to Private Sector [AR$ Bill. in Nominal terms]
Loans to Private Sector [Original Currency]
2.426 2.474 2.556 2.770 2.933 3.230 3.288
87,5 92,2 92,2100,3
102,8
3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 Jan 21Loans to Private Sector SUPV loans (AR$ Bn)
+3.3%+2.0% +5.8%+8.4%
+8.4%+0.1%+5.5%
+2.5%+21%
+17%
1.654 1.857 1.979 2.265 2.481 2.781 2.845
62,1 70,7 71,0 80,0 85,1
3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 Jan 21AR$ Loans Supv AR$ Loans
AR$ Loans [in AR$ Bn. in Original Currency]
+13.9% +0.4%
+12.7%
+12.2% +9.6%+14.4%+6.6%
+6.4%
Source: BCRA …% QoQ or MoM variation
+50%
+37%
U$S Loans [in US$ Bn.]
13,4 10,3 8,9 7,2 5,9 5,3 5,1
0,4 0,40,3 0,3
0,2
3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 Jan 21
U$S Loans Supv U$S Loans
-47%
-56%
-23.1%-13.3% -19.7% -17.5%
-19.1% -8.0% -12.5%-19.3%
+10.1%
+12.1% -9.8%
+31% YoY
+50% YoY
-48% YoY
+1.8%
+2.3% -5.0%
Inflation11.3% in 4Q2036.1% in 2020
6
INDUSTRY DEPOSITS EVOLUTION
AR$ system deposits slightly below inflation in 4Q20, while US$ deposit outflows continued. High liquidity levels in both currencies
Source: BCRA …% QoQ or MoM variation
22% 24% 22% 24%
45% 42% 40% 42%
31% 32% 32% 31%
0%
20%
40%
60%
80%
100%
1Q20 2Q20 3Q20 4Q20Checking Accounts Saving Accounts Time Deposits
Private Banks Deposits – Private Sector [%]
3.681 3.936 4.634 5.521 5.863 6.465 6.617
102,1 89,0138,0
162,5 170,3
3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 Jan 21Total Deposits
-12.8% +55.1%+17.8%
+4.8%
+19.1%+6.9% +17.7% +6.2%
Private Sector Deposits [AR$ Bill. in Nominal terms]
Private Sector Deposits [Original Currency]
Source: BCRA …% QoQ or MoM variation
AR$ Deposits [in AR$ Bn. in Original Currency]
2.450 2.771 3.465 4.339 4.633 5.114 5.251
75,5 65,7114,0 139,9 148,1
3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 Jan 21AR$ Deposits Supv AR$ Deposits
+89%+96%
13.0%+73.5%
+22.7% +5.9%
+13.1% +25.0%+25.2% +6.8%
21,4 19,4 18,1 16,8 16,1 15,9 15,6
0,50,4 0,4 0,3 0,3
3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 Jan 21U$S Deposits Supv U$S Deposits
U$S Deposits [in US$ Bn.]
-24%
-37%
-15.7% -4.3% -13.8% -9.6%
-3.8%-7.5%-6.8%-9.1%
+59%
+67%
+10.1%
+10.4%-1.3%
+64% YoY
+85% YoY -18%
YoY
+2.5%
-1.8%+2.7%
Inflation11.3% in 4Q2036.1% in 2020
7
3,9 4,62,1
1,4
23,227,9
12,58,2
1Q20 2Q20 3Q20 4Q20ROAA ROAE
INDUSTRY TRENDS IN NFM AND PROFITABILITYNFM, ROAE & ROAA decreasing from 2Q20 peak.
ROAA & ROAE [%]
Private Banks
ROAE and ROAA calculated with Comprehensive Income
197.180 219.738 175.180 171.094
1717
1211
27 25
1816
1Q20 2Q20 3Q20 4Q20Adjusted Financial MarginAdjusted Financial Margin / Average AssetsAdjusted Financial Margin / Avg. Balance of Interest Earning Assets
+11.4% -20.3%
Private Banks
Adjusted Financial Margin includes Results from Securitiesrecorded in Other Comprehensive Income
Net Financial Margin
Source: Argentina Central Bank. Monthly Bank Report as of December 2020
15,0 16,916,5
22,6
24,8
20,9
1Q20 2Q20 3Q20
0,92,6 1,3
6,90
18,70
9,70
1Q20 2Q20 3Q20
SUPV Adj FinancialMargin / Avg. Assets
SUPV Adj FinancialMargin / Avg. Interest earningAssets
SUPV ROAE
SUPV ROAA
-2.3%
21.617
35.865
20.84324.714
1Q20 2Q20 3Q20 4Q20
INDUSTRY TRENDS IN LLPs and CoverageCoverage ratio continued to increase in October and November. LLP decreased
105% 104%
128%136%
147%158%
165%174%
191%
206%212%
238%
86%
100%
127%
181%
ene.-20
feb.-20
mar.-20
apr.-20
may.-2
0
jun.-20
jul.-20
aug.-20
sep.-2
0
oct.-20
nov.-20
dec.-20
Private Banks SUPV
Coverage Ratio [%] Loan Loss Provision [AR$]
Source: Argentina Central Bank. Monthly Bank Report as of December 2020
Private Banks Private Banks
8
Contents SUPV Highlights
3Q20 HIGHLIGHTS
10
Double digit ROAE, while increasing coverage and strengthening capital base
01
02
03
04
05
06
•Higher Badlar rate reduced spreads and negatively impacted NIM•Regulatory controls drive lower Fees
•Strong COST CONTROLS supports efficiency
•INCREASED CAPITAL BASE with Tier 1 Ratio of 14%, and MAINTAINED STRONG LIQUIDITY to navigate complex and changing environment
•Delivered PROFITABILITYdespite Covid-19 restrictions, recessionary macro and changing regulatory framework.
•FLEXIBILITY to balance risk and profitability resulted in lower loan and deposit growth
•Accelerating DIGITAL ADOPTION•Evolving our SERVICE MODEL•Expanding corporate business adding
NEW VALUE CHAINS
•ADDITIONAL PROVISIONS increasing coverage levels•Closely monitoring ASSET QUALITY
11
Perspectives
Perspectives
Loans An anticipated mild rebound in economic activity is expected to drive loan growth above inflation
Deposits Increasing above inflation, fostered by FX market restrictions and the floor on interest rate paid to time deposits
NIM Short term NIM remains pressured by higher cost of funds due to floor on interest rates on time deposits and subsidized rates on loans
Operating Expenses
Salaries likely to grow with inflation, while incurring additional expenses related to acceleration of digital transformation. Impacted by i) higher rates in turnover tax, ii) CABA extension of turnover tax reach to Leliqs/Repos.
Capital & Liquidity Appropriate levels that support long-term sustainability
Asset Quality
Fee IncomeRegulations prohibit further repricing until February-March 2021. Some caps in place for 2021. Challenging economic scenario
A challenging macroeconomic scenario may result in a deterioration in NPLs in 1Q21-3Q21. Provisions could be revised upwards if conditions worsen
ContentsQ&A
Thank You!March 1, 2021