Alonso Aramburú

Alonso Aramburu followed up on asset quality, asking about new vintage trends supporting the NPL peak forecast, and inquired about longer-term NIM expectations for 2027 and beyond, aligning with the 20% ROE target.

Answer

IR Nicolás Torres confirmed a halt in the deterioration trend and observed stability in new vintages, expecting improvement soon, which supports the NPL peak forecast for early Q4. He projected NIMs to gradually decline to mid-teens by 2027 and low 10s by 2028, with volume growth expected to offset this decline.

Alonso Aramburu followed up on asset quality, asking what trends in new loan vintages support the confidence in an NPL peak in October/November. He also inquired about longer-term NIM expectations for 2027 (aligned with 20% ROE) and beyond.

Answer

IR Nicolás Torres indicated that new vintages show a stabilization and expected improvement in deterioration trends, supporting the Q4 NPL peak forecast. For NIMs, he projected a gradual decline to mid-teens by 2027 and low 10s by 2028 onwards, with volume growth expected to offset declining margins.

Alonso Aramburu followed up on Yape's pilot for the SME segment, asking for details on its approach, how it differs from Mibanco's strategy, whether it targets the same clients, and if it involves sales representatives.

Answer

CEO Gianfranco Ferrari explained that Yape's SME approach is transaction-based, with no human contact, making it cheaper and more efficient than Mibanco's proven but more expensive model. He noted that Yape's model is still untested, but initial vintages are performing well. He emphasized that Mibanco still has significant market share to gain, and currently, there are no cannibalization concerns between the two, though the approach might be rethought in two to three years.

Alonso Aramburu from BTG asked for more details on Yape's pilot program for the SME segment, specifically how its strategy differs from Mibanco's, whether it targets the same clients, and if it involves using representatives to visit clients.

Answer

CEO Gianfranco Ferrari explained that Yape's approach to SMEs is fundamentally different from Mibanco's. Yape's model is based on transactions gathered through the app, with virtually no human contact, making it much cheaper and more efficient, though it's still an untested model in its initial stages. He noted that Mibanco's model is more expensive but proven, with high ROEs. Gianfranco Ferrari emphasized that there's ample market space, as Mibanco only holds a 20-25% market share in microfinance, so cannibalization between Mibanco and Yape is not a concern currently, but the approach to microfinance/SME businesses might be rethought in two to three years.

Alonso Aramburú from BTG Pactual inquired about asset quality trends at Yape, including its cost of risk and NPL levels, the types and terms of its loans, and its target for lending as a percentage of revenue. He also sought to confirm the implied cost of risk for the second half of the year.

Answer

CEO Gianfranco Ferrari explained that Yape's loan portfolio is still small but growing, with a mix of single-installment and multi-installment consumer loans, and that its risk-adjusted NIM is very good. He noted that lending will be the major contributor to Yape's future profit. CFO Alejandro Perez-Reyes confirmed that the full-year cost of risk guidance of 1.8% to 2.2% implies a cost of risk closer to 2% for the second half of the year, up from the 1.6% in the first half.

Alonso Aramburú questioned when Mibanco might relax its strict origination policies to stimulate loan growth, given the commentary about being at a turning point in the credit cycle.

Answer

Chief Executive Officer Gianfranco Piero Ferrari de Las Casas responded that as the cost of risk improves, they are already seeing more portfolio activity. He indicated that policies will be relaxed in the coming months as positive trends are confirmed, which should lead to more significant growth.

Alonso Aramburú asked for a quantification of the expected negative impact on net interest margin in Q3 and questioned if the Central Bank might flexibilize its monetary policy. He also followed up on the cost of risk outlook for Q3.

Answer

CFO Gonzalo Fernández Covaro estimated the Q3 margin impact could be a 'couple of 100 basis points' but noted the difficulty in being precise due to rate volatility. He confirmed that while the Central Bank is receptive to feedback, its primary goal is economic stabilization. He also stated that the cost of risk for Q3 is expected to be 'slightly higher' than in Q2.

Alonso Aramburú from BTG Pactual asked about the potential for additional provisions related to Telefonica and questioned the outlook for the cost of risk, wondering if it would remain near 2.5% or rise toward the 3% guidance as consumer lending increases.

Answer

Executive Luis Castellanos López-Torres stated that based on current information, the company feels comfortable with its Telefonica provisions and does not anticipate more in the short term. He, along with an unnamed executive and Michela Ramat, clarified that the 3% cost of risk guidance accounts for the expected growth in the consumer loan portfolio. Michela Ramat added that the current loan mix has resulted in a better-than-expected risk-adjusted NIM, which is helping ROE.

Alonso Aramburú from BTG Pactual sought to reconcile how Interbank could reach an 18% ROE with a 3% cost of risk, given Q4's 16% ROE was achieved with a lower 2.6% cost of risk. He also requested color on the specific securities driving mark-to-market gains at Inteligo.

Answer

Executive Luis Castellanos López-Torres explained the path to an 18% ROE involves rebuilding the higher-yielding consumer loan book, which boosts NIM and fee income, offsetting a slightly higher cost of risk, alongside improved funding costs and efficiency. Executive Bruno Ferreccio del Rio noted Inteligo's gains were broad-based, with the equity portfolio, particularly financials and technology stocks, being the main Q4 contributor.

Alonso Aramburú of BTG Pactual asked if further one-off restructuring provisions are expected this year and sought to confirm if the 15-17% ROE guidance implies an ROE of around 19% for the remainder of the year, given the strong April result.

Answer

CFO Emiliano Muratore confirmed that no additional one-off restructuring provisions are expected in 2024. He also agreed that achieving the midpoint of the annual ROE guidance is reasonable, which would necessitate an ROE of approximately 19% for the rest of the year, with the final outcome dependent on the evolution of interest rates.