Banco Bradesco - Q1 2024

Transcript

Marcelo Noronha (President)

Hello, good morning, everyone. I am Marcelo Noronha. I'm here to present the results for the first quarter of 2024 of Bradesco. I'm here live, speaking from Cidade de Deus, or City of God. It's 10:31 A.M. It's a great pleasure to be with you once again, and before we start the presentation, I would like to say that unlike what we did in February, when I started presenting the strategy in a more, you know, lengthier way, the idea here is not to present a strategy in so many details again. But we will summarize everything, and then we will revisit some of the topics as the questions pop up. So I will talk throughout the presentation about what we delivered, in addition to the numbers related to the first quarter.

I'm sure, I think you had the opportunity to take a look at the numbers since we published, we posted the presentations and the release after 6 A.M. Our net income, recurring net income, was BRL 4.2 billion. It was flat in relation to the previous quarter, but 46% better than the last quarter of 2023. There are some points of attention here that are highlights of our balance sheet. Some are challenging, and some other topics relate to good deliveries that we've been doing. First, the improvement in AWL for both retail and wholesale, that also leads to an improvement of our NPL. That is improving in all segments. We also increase loan in all segments. I think there is a colleague from the Sell-side that last quarter asked me a question.

He said: "Do you think you would resume traction?" You will see through another chart that I'm about to show you, that there is an inflection in that total loan portfolio, and that's why we'll show you. We will show you growth in all loan segments with traction, and this is just to answer that question from the previous quarter. Well, the challenge is the gross client NII, but there is a justification for that, and that justification is in our guidance. First, we have the loan book, and then the margin follows suit, and I will talk a little bit more about it when I talk about the loan book and the guidance.

Another topic which is very satisfactory is the control of operating expenses, which grew 4.4%, as we will see, and a very sound performance of the Bradesco Insurance business. In all lines, we had a solid performance. So the results for the first quarter was BRL 4.2 billion, very much in line with what we intend to deliver this year. And as I said before, step by step, we will gradually grow. And I know that my clients on the Sell-side, in particular, those that have been analyzing us, they, they, they can look at the presentation from the last quarter of 2023, and then take a look at everything I'm about to tell you, and run a comparison with what we talked about the previous quarter. Therefore, our loan portfolio reached almost BRL 890 billion.

We grew 1.2% year-on-year. Looking at the quarter alone, the quarter says that we are growing steadily; we grew 1.4% quarter-on-quarter. In the quarter, the inflection of the curve saying that in the last two quarters, the portfolio was coming down, but now it was declining; now we are resuming growth. If we look at the free portfolio, if we were to look at the presentation from the previous quarter, you will see that traction now is much better based on the KPIs that we showed you in the previous quarter. Looking, you know, at individuals portfolio, we grew year-on-year 2% and 1.9% quarter-on-quarter, but this growth is well spread. Some portfolios give us a pretty good balance, and there are other portfolios where we have to grow products with higher margins, but we are getting there.

Payroll loans, we grew 4%, 2.1% growth quarter-over-quarter. You know, mortgage loan or real estate, I think we are probably the largest private bank to deliver growth, 5.8% year-over-year and 1.8% quarter-over-quarter. Credit card, we didn't grow. The risk was higher. But where is it that we are not growing? We are not growing in non-account holders. When you look at Prime banking, we posted almost 12% growth when we look at the credit card in the high income segment. Personal loan, 10.1% growth quarter-over-quarter, and 1.8% year-over-year. Vehicles also. In rural credit, the lines that are more secure, these are lines that, you know, are long-term lines, but at the same time, they carry smaller margins.

Now, looking at SMEs or companies in wholesale bank, large companies, we grew 1.6%, and SME, micro, small, and mid-sized companies, we are beginning to see more traction, so we grew 2.3% quarter-on-quarter. But I will elaborate further on SME, SMEs later on. Something new that I am now bringing to you is an example of the vintages. Vintages for mass individuals or individuals mass market. So we started with 100 back in 2019, and look at the second quarter of 2022. The vintages that we have been acquiring, that's the blue line, starting with the base of 100. But the bar in gray means origination for 2019. So origination for individuals mass market, you know, and this is again answering the question that you asked it back in the third quarter.

What about the mass market? This is proof of our principle, meaning that we are increasingly bringing better ratings, even in mass market, and this is proof of what we're saying. I'm talking about vintages over 30, et cetera. With time, we are not going to see, you know, vintages being right here. They will be slightly above, because we will get into products that carry a bit more risk, but they also lead to better margins. Here we have, to the right, you know, payroll loans, installments, finance. Cards alone is the only one that is not growing, and I already explained, and that was due to non-account holders, clients that come from Open Sea and from the digital segment. But delinquency is coming down, and this is due to the quality of the collection service we are now providing.

Now let's look at SMEs. I am exclusively talking about SMEs, starting with the base of 100, but look at the quality of the vintages. In terms of SMEs or companies, the bars have not yet reached the levels of 2019, because we're being more conservative. Now, I would like to highlight a few lines of growth, but there are some lines that we are not growing as much because of the risk involved. This today is a segment that presents the highest credit risk, but nonetheless, we continue to grow, and this certainly explains why we haven't yet increased in the total NII. Now, you see delinquency levels falling, and so now we'll talk about the net margin. So this is NII. You already look at the KPIs, and this is a snapshot of our portfolio.

When you look at this column that is available for you to look at, you look at how much we grow in terms of portfolios that are safer within our portfolio. And now we also leverage credit to these other two lines here. So the loan portfolio comes first, and then that's followed by the margin. In, according to our expectation, this is what we expect to see throughout the year, that the market NII goes down. So client NII is coming down, but when we look at the net client NII, look at the relative numbers, you know, where we were and where we stand today. So risk appetite is different. Therefore, we have new credit models, we have new credit policies. We are using a lot of machine learning in our credit, you know, segment and with our team.

Therefore, the quality of the risk is being monitored very closely, starting with FPD to control all of our portfolios. We are very much grounded. And then you could see that we gained market share in February when compared to the Central Bank portfolio. It's not the expanded portfolio, because the Central Bank does not disclose that. But I can tell you with a very good degree of certainty that we gained share in March alone as well. So we grew more in February and March when compared to January. So what we produced in January, there was just one month when we increased our NII. And whatever was produced in March, this will be reflected in April.

So our overnight loan portfolio, everything is under control in all lines, NPL, 100% of provisions, and our coverage ratio very flat and stable when compared to the previous quarter. Expanded AWL also brings important figures. I'm not gonna look at the previous quarter, but we had almost 18% growth year-on-year. I mean, in terms of mass retail, there was a drop, but the quality of what we are bringing is much better. We are much more effective in terms of our collection and credit recovery. Whenever we talk about AWL, I mean, this provision indicator versus the annualized portfolio, this is an index that we haven't seen for quite some time. Therefore, the numbers are very important, because it goes towards the NII that we presented in the previous quarter.

Now, speaking about fees and commission income, this is very much leverage on payment because of exchange and the companies that we have. So it's natural that it falls. I mean, this type of revenue is the lowest in terms of all the previous quarters, and the second quarter is better because we have Mother's Day, and the last quarter, you know, you have Children's Day, Black Friday, and all of the holidays, you know, the Christmas holidays. So 1.3% a year growth is an indication that growth will be according to our guidance, so it's within our expectations. And in all of the other lines, I would like to highlight Consortia with this level of growth that you see. I mean, loan operations, 10%, that means that we are well on track.

Checking account, we had been losing ground with checking account, but now we resume growth because of some of the intelligent packages that we are delivering and capturing value. I think the most difficult part is equities and capital markets, and the expectation is low for this year, and all of the reasons are well known to all of you. But we are very pleased to see the level of growth in terms of fee and commission income. When it comes to Bradesco to run comparisons-

... I mean, other incumbents say that within the fee and commission income, they also include insurance revenues, but in our case, that's separate because that is included in the insurance operations. Our operating expenses, for me, that is a highlight. That's our goal. We talked about 4.4% year-on-year growth. We are delivering things with a lot of seriousness, and the optimization of our footprint, with about 300 movements in the first quarter of 2024. Now, when you look at the book, you will see a chart that shows branches and points of service. Within that point of service, we have what we call PA. We have small PAs and large PAs, which are points of service. This is another name used by the Central Bank, but it is a mini branch.

In some municipalities, we shut down some of these PAs or points of service, but I will later talk about the company segment. This is something that we referred to at the beginning of the year. We said that we would, we would do another segmentation with very specific service, with specific branches to cater to companies, and that's what we did. So here you see a larger number of branches serving companies. In fact, there was a reduction, a significant reduction, or maybe at a bigger pace than what was previously announced. And I'll later on, I will talk about this new, you know, branches for companies and Bradesco Expresso. When we talk about personnel and admin expenses, the growth was even below inflation in the period.

Here are the results of the insurance group that you've seen: a net income of BRL 2 billion, 10% increase year-on-year, almost 20% ROAE, a substantial increase in premium income, pension plan contributions, and the results of almost BRL 4 billion showed a significant increase. I'd like to highlight technical provisions, which grew almost 12%, reaching BRL 380 billion. Quite a significant amount for the insurance group, which is doing quite well, performing really well. Here, our Basel Tier 1 Basel ratio of 12.7%. We have BIS in the book, so you can look at the total. We provisioned IOC for Q1 of about BRL 2.6 billion. This brings me to the guidance. Here's what I can say: when you look at this indicator, in the previous quarter, what did we have?

A declining, a negative number. We've got traction now, and we are within the guidance, no doubt about that. And of course, we have to move in this direction so that we will have a reflection in net interest income. So we have the loan book and then net interest income, and this can be the indicator that is the most challenging for all of us. But let's focus on 1.2%, and then net interest income will improve, and we believe we'll be within the guidance. Fee and commission income to me was delivered for the whole year based on the expectations that I mentioned. Operating expenses very, very safe. And again, the expectation is that it will be in the guidance. Income from insurance operations a little over or a little better. Great, but we believe that it will be within the guidance.

I'd like to remind you that the guidance is for the whole year, not for just one quarter. AWL, as you can see, BRL 7.8 billion. eight times four, BRL 32 billion. So we'll, you might think, "Will you be below the guidance? Are you being conservative?" No, but the calculation is simple. If I'm going to grow here massively on SMEs, I'll have more expected losses, even with the better vintages. So of course, I'm going to have more provisions down here, and that's why we believe that we'll be within the guidance, one or other line item, a little more towards the bottom of the guidance, and some others more towards the higher end of the guidance. We continue to believe, and we continue to move forward, step by step, as I mentioned in the previous quarter.

I'll make some comments about running the bank and change the bank. I'll start saying that in the past, we spoke about quick wins. No, it's, it's a plan. I said, we are not going to be delivering the next quarter. We will be delivering that along the next few years, and we'll have quick wins in recoveries, in collections, and some segments. So the reflection of all this over time will be seen in our income statement and in our balance sheet, with the exception of some specific cases. For example, the delivery for the companies segment. You can go to the branches and can speak with people there. So we'll implement a new modeling, and this will be reflected in our credit increase, credit quality, et cetera. So run and change are kind of mixed together because we do have quick wins. You remember the ten topics.

Like I said in the beginning, I'm not gonna go over all of them again, but I would like to make a brief comment, and you can look at these indicators. Let's speak about the digital bank. 98% of transactions are carried out through digital channels at Bradesco. So I'm speaking about the app, mobile and internet banking, in the case of companies. And this is our timeline for our strategic plan. You will remember that we presented the plan in detail back in February. And what have we delivered so far? A new organizational structure, a reduction of layers, and we are putting this into practice at the bank, and a span of control revision. So we increased that span of control.

The transformation office today counts with more than 800 people, and this was only possible because of this reorg that we had, or else we would not have the ability to allocate leaders here. So we are in a process of execution, which is very daring and bold and accelerated, and it's not easy. You know that. We spoke about diagnosis, of plan, a structure, and execution. And execution, of course, is the biggest challenge for any organization, but we are executing with determination, safety, and control. External hires, we also spoke about this. You will remember that we had two heads of departments that would report directly to me, one in HR, and the other one for the business, the digital business unit, which will take mass market to digital.

I'd like to announce that we had a reinforcement of the credit BU with the whole reconfiguration and targeting we did, and the creation of a portfolio management part. So we hired in the market a new credit director who has already joined us, Júlio Guedes. He came from Serasa, but has a track record in the banking industry. His background is in statistics. He's worked with credit for a long time. He was an officer in his prior role, and he was already providing services to us. I think it was great to bring Júlio to the company to reinforce our credit team. And regarding the C level, we already hired those two officers. This is the first time we've grown.

Many people ask me: "When will you be able to do it?" Well, the colleague who is coming for the digital unit as head of digital, reporting directly to me, is leaving another company, and our agreement was that we will only disclose the person's name on May 9th. So on May 9th, we'll disclose the name, and he will be starting to work on the 20th. So we'll use the press for that in our department. And we also hired a woman, a colleague, who will be in the C-suite with us in HR, Silvana Machado. Silvana started today. She's watching this call. And Silvana came from Advent. She was a talent manager there. She was also in Egon Zehnder for many years, and before that, Silvana worked for A.T. Kearney and in Boston, and always in financial services, in addition to having worked for many banks.

So she is an asset for us. She couples experience in dealing with culture and talent, as well as her financial services knowledge, so that she can be discussing any theme about the banking industry. And footprint revision. I mentioned about this, about 300 points, and this continues here. This will stretch until year-end, with strong execution. And the opening of 122 branches dedicated to companies, I'd like to congratulate the team that worked strongly on this to put together the team. And here I show you a picture of these branches dedicated to companies. We segmented 143,000 clients in this target of BRL 3 million-BRL 50 million, with 2,000 professionals focused on customer service. With a specific vertical, this is outside the network.

We are working on this to have a service model which is exclusive for companies with specialists. In addition to the experience here, we'll manage risk. This is the name of the game here. We'll be a lot closer, like we did with Middle Market, we are now doing with these SMEs, without losing sight of everything we're doing. SMEs between BRL 80,000-BRL 3 million per year, using remote service via the app. We increased the team that serves these legal entities, these enterprises. Our expectation is that by the end of the year, we'll have about 250,000 clients already targeted and allocated here. After that, expanding our radius of action for SMEs, and we're sure that we are going to have a lot of traction here.

[Foreign language]

[Foreign language]

[Foreign language] run the bank and change the bank.

[Foreign language] leverage, footprint revision, that's strongly on the way, and expansion of the Bradesco Expresso, as I've just mentioned. So we have deliveries.

We are following the plan step by step, so that we'll offer better and better earnings every quarter. I thank you for your attention, and I now have my colleague, Cassiano Scarpelli, our CFO, and André Carvalho, our new IR Officer, taking over from Firetti, and we'll start the Q&A. André, over to you.

André Carvalho (Director)

I think I already said a lot. Good morning, everyone. I would like to inform all participants that Ivan Gontijo, the CEO of our insurance company, is also joining us during this Q&A session, and he's with us remotely. But if you want to send in your questions, you can send them either in Portuguese or English, and please do so using our email investors, like you see on the screen, [email protected], or using the WhatsApp number. The information appears on the screen. The first question comes from Renato Meloni, from Autonomous. Renato, over to you. We can't hear you. I think you're muted.

Renato Meloni (Partner and Analyst)

Good morning. Good morning. Sorry. Thank you for taking my question. I have two questions. The first question is about your transformation plan.

Now that three months have gone by since the official launch of the program, and you have more visibility, what is different when compared to the original plan? And given your current visibility, whether there has been any changes in terms of delivering ROE above the cost of capital, and you said that you would do that throughout 2026. And my second question relates to the guidance. To reach the NII guidance, this means that you have to have better origination, better margin, because I think this will come with the mix, and this will improve provisioning. So how do you see these three levers performing throughout the year, and what is the pace, and where do you see the risk of not delivering what you expect, not deliver to plan?

Marcelo Noronha (President)

Well, thank you for your questions.

I will ask Cassiano to start, and then I will... Not only Cassiano is the CFO, but he's the CPO. So Cassiano is the best person to talk about the KPIs of our transformation plan.

Cassiano Scarpelli (CFO)

Thank you, thank you, Renato. Thank you for your question. Our transformation plan, I mean, what we did, we ratified what we envisioned in the diagnosis of our transformation process. As Marcelo put it quite well, we have over 800 people engaged, 2,600 initiatives, and the KPIs are very apparent. I mean, starting with the footprint, all the way to the run the bank and credit segments, also that involves recovery, risk, you know, hiring new people, technology, et cetera. So we launched the plan on February 19. That's when our new office started operating.

Looking back today, we can say that this whole mapping was very important, and we found more things, which was quite interesting. We found other things that can lead us to having a more agile bank, a more digital bank, even more than what we are rendering, even a, you know, better customer experience. It's not, you know, way ahead in the future, but it's throughout the journey. I am certain that the plan is well structured and the deliveries are well in schedule, and we will improve performance.

Marcelo Noronha (President)

Renato, just to add to what he said-

...De fato, we reinstate that number. You might recall that I talked about the total number. You may have, you know, some small adjustments to the calendar. Okay, this was expected for December, but it may be earlier or later. I thought that SME would help, but would perform better further on, but we were able to deliver the numbers before schedule. So we still have that expectation in terms of the numbers. You might recall that if our CAGR for loan book would materialize, if CAGR would be 1% a year growth, our loan portfolio total growth for the expanded portfolio will be BRL 3.3 trillion in five years. I mean, we want to capture part of it. And the expectation remains firm, and we see through traction that we do have the capacity to get there.

Secondly, in regards to that ROE expectation that you mentioned, I would just say it again, I don't want to just, you know, just promise things. I want to deliver. As soon as I can deliver, we will deliver to expectations, and that's what we, we intend to do, to deliver things as time goes by. The other question was about client NII. How do we expedite that? I mean, we accelerate through growing our loan portfolio. During my presentation, I said that, okay, we gained market share in February. In January, we did not gain share, so we had to move faster in February, which we did. I'm -- I firmly believe that we will gain share in March. In April, that's when we will see what has been done. I mean, that, the NII, things will not happen overnight.

First, we will see a growth in the portfolio, and then we will see, we'll see an increase in our net margin, because the bottom line is that delinquency is under control. We are bringing good quality things to our portfolio, and that's when we will see a growth in NII, an effective growth in NII. So you might recall that I'm talking about two different types of portfolios and two different types of risk acceptance. This will require additional effort on the part of the bank. I don't know whether you would like to comment. I mean, the client NII will be better in the second quarter vis-a-vis the first quarter, because there is a gradual evolution. First quarter, lower ALL, and then with time, you know, the margin will grow with ALL, because we will go through, you know, more risky sectors.

Our funding cost is coming down as well. This is what we are noticing, and this has an impact in the timeline.

André Carvalho (Director)

Renata, thank you for your questions. The next question comes from Brian Flores from Citi. Go ahead.

Brian Flores (VP of Equity Research)

Hello, thank you for taking my question. With a more restrictive Central Bank, and you talked about funding, how does that change funding? And also talking about market NII, what is your view about market NII?

Marcelo Noronha (President)

Hi, it's a pleasure to see you. In terms of market NII, I would say that we don't see any major changes to this year. There was a slight drop, you know, from one quarter to the next, and the Central Bank with a more restrictive curve.

But that tilted curve, as we say, it is very important for our fixed portfolio because it brings a more interesting fee volume. And we believe that even though the landscape is more restrictive, it points to a decline in interest rates, because 9.5% or 10%, that is not very significant because it doesn't change the landscape as much in terms of our treasury position. Therefore, we see this as something beneficial, because on the one hand, we reinstate our loan portfolio with, you know, higher rates. So in terms of the cycle as a whole, the cycle would indicate 9.5%-10%. Our economist points to 9.25%. I don't believe in a cycle where interest rates will spike after that.

So the scenario will bring about good results, and the market is performing well, pretty much along the lines that we mentioned before, which is positive, and we see a positive trend towards 2025. Just to reinstate what he said, the expectation is that the market is very bullish from now on, and the fact that the rate will come down 50 or 25 basis points, nothing much will change. Okay?

Thank you for your questions. Jorge Kuri with Morgan Stanley. Mr. Kuri?

Jorge Kuri (Analyst)

Hello. [Foreign language]

Good day, pessoal. [Foriegn language]. Hi, good morning. Can you hear me now? [Foreign language]

Marcelo Noronha (President)

Yes, yes, we can.

Jorge Kuri (Analyst)

Thank you. [Foreign language]. Thank you for the possibility to ask questions. I think that the positive highlight of the quarter was the improved credit quality.

Seems you're very confident to accelerate growth in those loans with higher spread. The question is: Is the bank ready to accelerate, maintaining NPL under control, protect particularly in retail? What were the main adjustments the bank made in terms of policies, credit filters? What were the main structural adjustments? If you can elaborate that, perhaps from the qualitative standpoint, that would be very helpful. Thank you.

Marcelo Noronha (President)

[Foreign language]. Thank you for the question. [Foreign language]. As I mentioned during the presentation [Foreign language] machine learning [Foreign language]

[Foreign language] value proposition.

[Foreign language]

[Foreign language]

[Foreign language] We are very safe. I mean, of course, we are not gonna be within, with that ratio for the vintages, but a little higher, which is the optimal point. But what we are measuring is the economic return of each cluster of clients, so that we can work with the bottom line, with adequate pricing. If it doesn't match what we expecting, we just won't do it. We're feeling safer about what we are doing, we are delivering qualitatively. There's AI behind this, but AI is not the main tool. It's the main tool is machine learning. This is it. Would you like to add anything? [Foreign language]

[Foreign language]

[Foreign language] Renato, [Foreign language]

André Carvalho (Director)

[Foreign language] Daniel Vaz, do Safra. Daniel?...

Daniel Vaz (Lead Analyst of Equity Research)

[Foreign language], André. [Foreign language], Cristina. I'd like to ask a question about SME. You showed a trend of origination for middle market companies, middle market. You're still away from the average of 2019. How do you explain this gap? We have a above 90 day in [audio distortion], but, but why is the origination not at the same level of 2019? Is it a supply or demand issue? When can we expect this to grow?

Marcelo Noronha (President)

Number one.

Speaker 16

Or number one.

Marcelo Noronha (President)

[Foreign language]

Speaker 16

It's about risk appetite.

Marcelo Noronha (President)

[Foreign language]

Speaker 16

This is the highest risk segment, particularly for those companies zero to three. In three to 50, I spoke about managing a living portfolio.

Marcelo Noronha (President)

[Foreign language]

Speaker 16

There's a management model that is being implemented in this segment.

Marcelo Noronha (President)

[Foreign language]

Speaker 16

That allows us to follow up on a living portfolio and act on it totally differently. It is automated, but at the same time, it counts on our colleagues, the managers, the regional managers, to act on specific cases. So we'll improve the quality to 30-50 million borrowers, but until 3 million, there is effectively more risk because the Brazilian market is like that for SMEs. So we have a little appetite to get there, but we believe that we have started, and we will continue to grow origination.

Marcelo Noronha (President)

[Foreign language]

Another reason to believe in that is that we totally changed our offering, what we offered to our sales force for pre-approved, the way to approach clients with a commercial tool. It's all changed, and it started now in the month of April, with a different setup, a different configuration. In our opinion, in the opinion of the colleagues responsible for that segment, this will give a lot more traction to have a better credit quality, better credit analysis, more specialists working in that segment, a new commercial tool. I mean, not a new tool, it's a new commercial format for this segment. In this new segment, of BRL 3 million-BRL 50 million that we've re-prioritized, there's a different traction compared to the segment of up to BRL 3 million a year.

We believe we will increase our loan origination, but with the right controls and quality. When we look at the track record of delinquency, historical series shows that individuals drop first, and then SMEs, and then small enterprises. Small enterprises are having their inflection now. That's the market risk that Marcelo talked about. That's why, that's why our appetite will move step by step with safety, and in the future, we should accelerate in, in the segment of smaller companies that will require more provisions, but the margin will more than offset that. The credit policy that we just did, we work on it all the time.

André Carvalho (Director)

Daniel, thank you very much for your question. Now, Mario Pierry with Bank of America.

Mario Pierry (Managing Director)

Good morning.

Speaker 16

Good morning.

I have two questions. First question: When we look at the bank's coverage ratio, we calculate a ratio close to 162%. I mean, it's lower than your peers, but we also look at your complementary provision, close to BRL 6.2 billion, and historically used to be around BRL 8 billion-BRL 9 billion. Do you intend to revisit those reserves? How do you feel the reserve level stands today? And the second question is about capital. There was a decline in your CET1 ratio, a drop quarter-on-quarter. So how do you see this, you know, CET1 ratio impacting your dividend policy or even your capacity to grow?

Marcelo Noronha (President)

In terms of coverage ratio, we do not have a target for that coverage ratio because it fluctuates according to the credit cycle. So if the cycle aggravates, you know, delinquency as well, I mean, because we increase the amount of provisions, I mean, we provision for 100% of our clients. As the credit cycle begins to change, when we saw that happen in the first quarter of the year, certainly the coverage ratio increases because we originate credit that naturally, at the beginning, comes with higher provisions than delinquency. Coverage increases, therefore; this is a very cyclical KPI. We are not very much concerned with it. We think it's very adequate for the current moment, and certainly it has a natural recovery. Now, in terms of...

[Foreign language]

[Foreign language] Well, first of all, you know that we project capital going forward. Also, we projected for following years, we see capital standing flat, even though the portfolio is growing. No problems here. Secondly, I don't think this will be a limiting factor for growth or even the distribution, I mean, of interest on capital. The coverage ratio, I think I told you in the first quarter, I referred to how comfortable we are in terms of the wholesale banking.

Our total coverage ratio is very good, and in particular in terms of the wholesale bank, because I was asked this question by journalists during our press conference. It is very much under control, and I talked about that last quarter. Our coverage ratio is ideal, and we even have some room for other cases related to expected losses. Therefore, no problem at all in terms of our coverage ratio.

André Carvalho (Director)

Thank you for the questions, Mario. Now we have Thiago Batista from UBS. Next question.

Thiago Batista (Executive Director)

Good morning. Thank you for taking my questions. I have two questions. One is, I mean, it's a follow-up question. My first question is about the insurance business. We could see any increase in technical provision, quite significant this quarter. But when you look at the details, you had BRL 2.4 billion in additional coverage provision.

Moreover, there are all other technical reasons. Last quarter, you used part of that technical provision. I would just like to understand two things: If this was part of your income statement, or if there was something that was recurring and you wanted to reset. So what was the reason for that additional coverage? And, now, speaking about Mario's question on capital, I understand that you said that maybe at the end of the year, your capital position will be similar than to the one we have today. Does that include any kind of arrangement in terms of the capital for the insurance company? Or I think in 2015 or 2016, you would get capital together with IOC. Is there anything included in this line?

André Carvalho (Director)

Or maybe historically, you think that you could keep capital very stable, because the portfolio, I think, increased by BRL 1.4 billion, and you consume BRL 1.3 billion in capital. So it doesn't seem ideal to keep it stable and maintain the guidance without any sort of arrangement in terms of the insurance company or IOC.

Marcelo Noronha (President)

I mean, to answer your second question, I will say no. I mean, you're saying that you have an additional flexibility. We won't even need to use that because we could even think about using it, but I don't think we will need to. Our projection leads us to say that with a great degree of certainty, what changed from last quarter to this quarter?

Cassiano Scarpelli (CFO)

The main motivation involved two things: payroll.

We had the payment of two important payrolls, and also, you know, NTN-B, which is mark-to-market bonds, and this is due to the natural hedge of our funding. And also this is related to private pension funds, which are an important part of the strategy. So these were two big movements, so this was a one-off event, and the difference is due to the payroll payment. I mean, to the payment of payrolls. That's why our projections and our growth curve is very much under control. I think we can also ask Ivan to answer the second question, but I would like to recall another point about the insurance company. This is something that we already saw in the past. Thiago said that himself, this is part of the technical strategies.

So at some moments, we had to do some improvements in the provision. This was strictly technical, and the provision has to do with all of the economics of the insurance business. I now would like to ask Ivan to add to my comments. Ivan, I think you may recall the question, you talked about technical provisions. And whether that- On the DRE?

...had any impact on our income statement, and what would be the additional provision? So, Ivan, go ahead.

Ivan Gontijo (CEO)

Thank you, Marcelo and Cassiano. I think Cassiano already explained the technical view. I would just say that that increase in provisions is linked to an increase in the revenue of insurance and pension funds, especially pension funds and savings bonds. So that link in that increase in provisions is proportional to increase in revenues. And secondly, this is also due to the so-called product mix that we have. We have insurance products, you know, pension fund products, and certainly they demand an adequate level of provisions, always having a very conservative approach. And Marcelo, you mentioned our, you know, provisioning, which is close to BRL 380 million, especially products like pension funds that increased significantly during the period.

I would just like to emphasize that there hasn't been any kind of recurring gain that could probably lead us to have anything different in our, you know, in our structure. So everything is business as usual, and in compliance with the regulating agency, because it's important that we comply with our short, mid, and long-term agreements.

Thiago Batista (Executive Director)

Okay, thank you very much.

André Carvalho (Director)

Next question from Tito Labarta with Goldman Sachs. Go ahead, sir.

Tito Labarta (VP)

Hi, good morning. Thank you for the, the call, and thank you for my question. My question is on, on your funding. When looking at deposit base, your funding quarter, and I know that we can seasonally related to that, we also have also seen a big shift from demand deposits to time deposits. Now, that could be a function of rates. But just putting that in the context of the competitive environment that we're seeing, are you having to pay more to retain deposits than retain clients? And is that limit your ability to control your NII because you're in order to fund the growth, you will need to pay more for deposits. Just how are you thinking about that, even though I'm trying to happen in this specific group?

Ivan Gontijo (CEO)

Thank you, Tito, for the question. Our funding cost, Cassiano, actually, top level and liquidity ratio is quite robust. So it's been reducing a little, because we have to balance with our credit, credit granting. We have to optimize cash and cost. So funding cost somehow continues to grow. It has a little bit to do with the reduction in LCR and credit consumption. Demand deposits continue to suffer, because as our clients pay attention or they are approached by our, our investment department or our platforms, they tend to look for, products with more profitability. Our funds grew almost BRL 20 billion, and some of that comes from the movements of demand deposits and savings accounts. Savings accounts have been dropping in the system as a whole.

There is always this discussion about savings, accounts, and CDI, and this comes from the discussion with the fintechs. So clients look at differentiated opportunities. We have Ágora, our experts, onboarding the channels, the app or internet banking. And they, one way or another, observe this and provide opportunities to clients. So we see this as a natural moment in the industry, but we have products with different allocations to different clients. So with savings accounts and demand deposits, they are enough to maintain our strategy for rural loans or mortgages, real estate, finance. Would you like to add anything? But, you know, in savings accounts, we had a market share of 13%, and that increased to 13.1%. This is kind of the DNA of our clients.

We have a savings account DNA, so savings accounts tend to remain flat, but the non-floating products with higher interest rates have a trend to capture more clients. So we see this movement with as being natural. And a lot of people have asked us about funding linked to changes in those, what we call, exempt securities. And the impact here is practically zero. First, because we have funding with exempt securities that is being accelerated to purchase the inventory, and then we have a natural replacement of these exempt securities by other bonds. So the impact here is practically zero in our funding.

André Carvalho (Director)

Next question from Eduardo Rosman with BTG. And thank you, Tito.

Eduardo Rosman (Senior Analyst)

Good morning. I have a question about the results in the different segments of the bank. Because the earnings of the bank improved, the insurance company remains...

Well, it lost a little bit of relevance as a whole in this quarter, and you don't really disclose the results for high income, low income, retail, and wholesale. So it would be interesting to hear from you, where do you see easier improvements in the results, if in low income, if the reduced provision is already improving the result, and whether there is any segment that is deficient? If you could elaborate about the different segments of the bank. Thank you.

Marcelo Noronha (President)

Thank you, Rosman, for the question.

[Foreign language]

Speaker 16

Well, we're doing well in the wholesale bank.

Marcelo Noronha (President)

[Foreign language]

Speaker 16

We have an RAR that is high for the different segments. This is also for high income segment, not to mention private.

Marcelo Noronha (President)

Muito bem, né?

So that's doing quite well. Our challenge, as you know, spoke about the insurance group, but our challenge, as you know, comes from our mass market clients, given the cost to serve and delinquency, and we've been paying that bill. But indeed, things are starting to improve a lot. In SMEs, in particular, though we see the delinquency curve dropping, but there's some improvements, and month by month, we see improvements. So our expectation is that we will drive the RAR of the mass market quarter after quarter. And I have to tell you, we don't really disclose this breakdown, but what I can tell you is that all business units have a lot of traction right now. An area that might have a small traction or a smaller attraction could be small and mid-sized enterprises, but it's improving.

And again, that Open Sea of a lower income client because they have a higher risk, but they are all with a lot of traction. Not by chance that we are doing this. That we are growing credit in all segments, in important lines, so we have the ability to deliver and to deliver more than we are delivering right now. And what I see and what I am living, because I've, I've been going all over Brazil, I've been having breakfast with colleagues in the headquarters, in many locations, in Rio de Janeiro, in São Paulo, in Salvador. And it's... I, I see everyone motivated and excited and moving in the same direction, so we are improving the RAR, the risk-adjusted return for all of these segments. We are going to be delivering in, in the future quarters. That's my expectation for all business units.

In the mass market, perhaps the biggest challenge is to accelerate credit, maintaining NPL declining, and adjusting the footprint. The numbers we showed here point exactly at that, the new vintage of mass market increasing, accelerating with exceptional quality and the footprint adjustment happening.

André Carvalho (Director)

Thank you, Rosman, for the question. Next question from Eduardo Nishio with Genial.

Eduardo Nishio (Research Head and Banking and Financial Services Analyst)

Good morning, everyone. Thank you for taking my question. My- yeah, everything is fine, thank you. My question relates to your strategic plan. Part of the recovery that you anticipate comes from improvement in the cycle that impacted the mass market, but most of it comes from more structural changes that you are promoting. I would like you to elaborate further on your structural changes and everything else that is happening with your strategic planning. If you could list probably the main strategic structural changes that you have in mind for the next quarters or maybe years. And also, if you could give me more details about changes in management and cultural changes as well, that you are trying to introduce in the bank, especially that cultural aspect, because this has been something so important in the DNA of the bank.

André Carvalho (Director)

How do you anticipate in terms of these changes, and what do you see going forward, you know, in 2028, after everything has been done?

Marcelo Noronha (President)

Well, thank you. These are very open questions, and I think we could spend days here just answering everything in more detail. So I'll ask Cassiano to help me, you know, with the answers. Well, number one, that delivery of that credit business unit, we unify processes that were separated in our organization, so everything is now combined, integrated. We, I mean, the separation of the teams that used to serve the, the mass market and the wholesale bank, we made also important process changes. First line of defense, second line of defense, with the use of machine learning, running in the background of our modeling. And we also introduced some credit policies, because you put a certain appetite. Okay, you say: I wanna give 50% of the company's revenue. So that was one change. The second change was segmentation.

That segment of SME is one of the things that we told you that we would launch early this year. It's already in place. We don't have all the clients already in there because we're still in the process of segmenting clients, but we will also deliver the affluent segment, the wealth segment in the second half. But we will also, we are also working on restructuring our Prime segment for more, you know, for wealthier clients, and that's another important segmentation. In terms of the wholesale banking, I told you that we made some process changes on the loan book side.

So I'm saying that this is something that is already happening, and this is generating results, and in turn, this will improve our numbers with time. And obviously, I think the biggest challenge is in the cost to serve our more mass retail clients. Well, we are reviewing the footprint, because we are delivering above plan, but we will deliver numbers above the plan with costs under control. And all of these deliveries will allow us to get that additional revenue that we talked about last year. But even today, I said that since the market is growing with a CAGR of 8% a year in terms of the credit volume for the next five years, it will bring an additional BRL 3.3 billion to the Brazilian market in five years.

Certainly, we want to capture part of that, so that when we go forward, our revenue level will be much higher and our return will be higher because, you know, the bottom line matters, which is the profitability that we will have. Cassiano, I think you can add to what I'm saying, because out of the 10 topics that we listed, we had over 2,600 initiatives, but I am just highlighting some of the main initiatives. Also, there was that movement of time to market that we're doing with the technology area and the very intensive use of GenAI. I would also mention these two. Yeah, I'll talk about that management side as well. There are two important points.

Cassiano Scarpelli (CFO)

Bradesco Expresso, it's a very important link with this new concept of the new footprint and print, and our cost to serve together with digital. Marcelo also mentioned that during the presentation. It's a, it's a very strong digital bank. Bradesco Expresso is a very positive tool because we can be present in many municipalities. Technology, Marcelo mentioned that not only in terms of reskilling, but also we are hiring new people. We are hiring people at all levels of technology, and all important processes are becoming more agile, it's becoming more productive. It's a new concept, and this is across the board. And culture management, I think you should also talk a little bit about that and what we are doing in terms of our culture.

Regardless of the fact that we do not want to lose our Bradesco way of being, we also want to have new colleagues that can add important values. Here, we have colleagues from three different places. I even think that when we meet in person, I think we can also discuss things with the Sell-side. I would say that what we are seeing, just trying to make an executive summary of everything, we are bringing two C-levels to the organization, people that are being brought from the market, and this is an important cultural change. The reduction of these layers brought about an enormous difference in terms of speed. As I was saying before, I've been going around the country and having breakfasts and lunches with different people, and meeting with different segments of the industry.

It is amazing to see that once you shorten the layers, the communication becomes much faster. Things become a lot more agile, and our decision-making process, you know, in the bank, if you just start interviewing people from within, people will come and talk to you about it. That's another relevant aspect once we talk about changes to our culture and management. Silvana is just arriving. She will work together with Juliano in that transition, and she will work with me as well. So we are working on that new HR plan that I've been telling you, that we will deliver, and we will go even beyond.

We eliminated some positions, some layers, and we want to continue to do changes within our organization with hierarchical levels, maybe better, so that throughout the end of this year and next year, we will have a leaner, you know, a more lean company. We do not want to eliminate the values, because the values are important, because they support our culture, but that's not all. In fact, we want to maintain values.

Eduardo Nishio (Research Head and Banking and Financial Services Analyst)

What values?

Cassiano Scarpelli (CFO)

For example, we will stop offering promotions and, and career promotions. No, on the contrary, this is a place where you can get promoted and, and improve professionally. But we're also willing to bring somebody from the market if we need to have more skills in the organization. This is basically it. Secondly, our employees, our managers, they carry the banner of Bradesco. Why is it that we would think about ending this?

On the contrary, we want to harness this even more, but we want to have a wider management in our organization with fewer layers. We want to have a different outlook, a different perspective, see the areas that are different, differently, not being standardized, with a much faster decision-making, with a lot of technology integration, different skills directed to digital, and this is what you're going to see in our organization.

Marcelo Noronha (President)

With these changes in cultural traits, with these additions that we have been making in the organization, and with a span of control that is different, you have no idea, Nishio, it's so different. So I think this is it, because we even spoke about this in the prior quarter, about the total volume of revenue available in the Brazilian market. I'm almost sure of that. I haven't got the number from the top of my head, but please check the previous earnings conference call. I'd like to take this moment to draw your attention. If you look at my presentation back then, and my presentation today, please let me know if there is any difference. What we said back then is what we're executing.

And another important thing: there is nothing else in this bank that is not measured. Everything in Run the Bank or Change the Bank is measured. We have a new project. For example, we're going to expand our middle, middle corporate segment. It will be expanded. This project has been approved. We'll grow the team, another 10 platforms around Brazil. What we call platform is actually having a branch dedicated to this middle corporate segment. But it all involves measurements, and decisions are made quickly, but all suggestions need to be proven. And it's going to be a cheap branch, not a huge branch. It's a platform, as we call it, when you look at total numbers, but it, it's registered as a branch at the Central Bank of Brazil. So Nishio, I think that this is kind of an overview.

Ivan Gontijo (CEO)

One last comment, the result of the transformation process will be recorded in the operating results of the bank, and that's fundamental. We have to focus on the operating results to see the transformation and the timeline to organize what we've done already and what we will be doing in the future.

André Carvalho (Director)

Thank you, Nishio. Next question from Pedro Leduc with Itaú BBA. Leduc?

Pedro Leduc (Lead Equity Research Analyst)

Cool. Thank you. We can hear you. Go ahead. Thank you for the call, and thank you for taking my question. I'd like you to elaborate on the NII dynamic, particularly client NII. The NII in this quarter had a relevant drop, 14% year-on-year, and the NII is still dropping in a similar speed to the past quarters. I know, André, you said, first, you grow the portfolio, and then we're going to see a positive impact on NII.

But thinking about the sequence, it seems to me that the current origination is coming with lower spreads, perhaps because of the line or the mix. My rationale is, I see payroll-deductible loans increasing, but with caps, putting pressure on profitability. You also have the savings account deposits following corporate segment being very competitive. So as an outsider, it doesn't seem that the portfolio construction is not helping to converge to the guidance. NII, historically, I know a lot has changed, but it was the line item that was always farthest, farther from the guidance. And I see you're very comfortable in maintaining the guidance, particularly for NII. So I'd like to hear from you, is my interpretation wrong, are the spreads more pressured, more under pressure? Is it about more mix or more volume? And perhaps a lower AWL will offset a less dynamic NII.

Marcelo Noronha (President)

Well, it's, it's a long question, but thank you for this question. I guess that at the very end of your question, you kind of gave us the answer, because we look at economic value. So we, we look at the NII, not the gross NII. So in NII, you saw that it's starting to grow, and we'll see that. And if you look at the mix of products, you will see that we boosted those higher-risk products, but everyone here is very down to work. We are not going to have that NPL, that delinquency in the future. On the contrary, and like I said, and I stressed this during my presentation, in February, we gained market share. In March, most likely, this will be disclosed by the Brazilian Central Bank tomorrow, and also the most likely, we also gained market share.

You're also right when you say that payroll, loans, and mortgages have lower margins. That is a fact. The margin takes longer to come, but we are also offering products with a higher margin. We grew in February and more in March, and this will have a reflection in April, May, June, July, and so on and so forth. As regards to the wholesale, you talked about spread? Well, that doesn't exist, that the spread in the wholesale bank is under pressure. It's always been. Here we work with RAR, risk-adjusted return. So our regional managers, using their phone, the tablet, or their monitors, they see exactly the same thing. They see the RAR history of the client. They can simulate what they need to do to negotiate with the client online, real time. So we put pressure on them regarding RAR.

They just don't have a deal to add to their portfolio. Today, the market doesn't give you a lot of room to bring those to your portfolio. We also have what we call OPCD for the secondary market, OPCD portfolio. So you see, the margin is not coming only from spread. We don't address this operation by operation, we address it by client. So when we have an adequate RAR and relationship, the deal goes through, or else they don't have the ability to approve the deal. So there's a rationale here. We implemented this when I was in the wholesale bank, together with Bruno and our colleagues there. So this is not new. The margin comes from the whole. We also have private payrolls. We are one of the largest banks managing payrolls. This means relationship with large corps, mid-sized enterprises, small enterprises.

We have other businesses that we do around the relationship with legal entities, so revenue doesn't come only from the margin. Now, to make up the client NII, we'll grow SMEs, because this is added to individuals for us to build up our margin over time. Is the client item challenging? It is. But rest assured, just wait, because we'll get there. We are looking at NII, net interest income. That is what is important. I have to have a balance between what I do and the potential loss with these clients, and this is our handbook for our day-to-day. Of course, the portfolio needs to come first, and the NII will come later. We'll keep looking at the mix over time, and we'll see a more balanced mix. With delinquency under control, we have to have high quality assets.

Okay, Pedro, so we won't make a mistake.

André Carvalho (Director)

If you wanna add anything, I just have two very brief comments. Pedro's question was more directed to product mix, and as Marcelo was saying, there is also the segment mix. Once we accelerate SME and individuals' mass market, we bring on board more margin. The second comment is about guidance. When we look at the guidance, the guidance gives us an idea of, you know, profit a year. That's valid, this is what we work with. But in terms of a turnaround history, when we point the guidance towards the end of the year, the beginning of the year is different from the end of the year, because you are turning the portfolio, so it's a more classic case. It is more limited, and it turns around, and then it picks up again, so it will be different, you know, if you compare one and another.

I mean, it is valid, but there are fluctuations in some possible lines, you know, within a turnaround perspective. Now, Carlos Gomez-Lopez, next question from HSBC. The floor is yours.

Carlos Gomez-Lopez (Head of LatAm Financial Institutions)

My question... I have two questions. First is on funding. There was a drop of almost 13% on checking account year-on-year. When do you intend to change that in terms of cheap funding? The second question is about Next. We don't have a lot of information about the future of Next or the digital platform.

Marcelo Noronha (President)

Thank you. Thank you, Carlos. So you start first, and then I'll talk about Next.

André Carvalho (Director)

Carlos, thanks. It's a pleasure to see you. Marcelo just said now that one of the important indicators is our cash growth. We are doing some important work with companies and also working with some SMEs that are now coming into our offices.

I think that the fair share path is important, and this will strike a balance when it comes to mix or with that demand deposit. We must also remember that we have lots of CDBs, which are some instruments related to demand deposits, and that's not specifically in that same line. I mean, you have a remunerated line, but not to that client. You only see that when you look at the time deposit line. I mean, remuneration is a bit lower.

Marcelo Noronha (President)

I mean, it's a bit lower in this business. That's why you see this change. But it's not loss, but gain, because the line is not broken down for you to see it more clearly.

Ivan Gontijo (CEO)

Yeah, I think you're right. In terms of the clients, that is it. And again, the more the client helps itself, it looks for different alternatives, and we keep, we will keep seeing these changes. I mean, the first quarter is more seasonal, but we, we understand that this is quite normal, and within the context of the year, this will be within the lines of what we often do.

Marcelo Noronha (President)

Now, about Next. Now, to answer your question about Next, with Next, you know that part of the investments are within Bradesco. Digital is totally outside Bradesco. We had decided that Next would be another segment for us here with a brand that is known in the market.

But when we reviewed our strategy and the plan, we decided not to make that move before we would make all the decisions related to that mass segment, because we have learnings with Next and learnings that come from digital. So we are now in this decision-making process. We have some possible-

... path, and you will see that in due time. Also, with this new colleague that is arriving, that will certainly help us in this process of execution and, and decision making. But if you look at our playbook, you will also see some interesting figures about digital. Take a look at that, because we have some information about digital in our playbook. And thank you for your questions. Thank you.

André Carvalho (Director)

The next question comes from Guilherme Grespan from JPMorgan.

Guilherme Grespan (Equity Research Analyst)

Hi, thank you for the presentation. Our question is on cost. We already talked a lot about, you know, G&A, et cetera. I would just like to look at orders. This was a controlled, I will say, a controlled quarter. In discussing the guidance with you early this year, I think there was a caution in terms of the total cost of the guidance.

Because of that line, guidance was above inflation, and part of the explanation was because you were very cautious about that line throughout the year. But looking at the run rate for the quarter, if the pace was to be maintained of about 1.5% throughout the year, we would see a drop when compared to 2023. The question is, how could we see this line going forward if the pressure you were anticipating at the beginning of the year is still a base case for the rest of the year? And also, exactly what led you to see this more beneficial performance or behavior of the line?

Marcelo Noronha (President)

Thank you. André, you start, and then I'll add.

André Carvalho (Director)

My first comment is that there was a very good performance in all the lines of the main operating expenses.

Personnel, you know, admin, and other expenses. Marcelo pointed out quite well that personnel and admin expenses grew 3.5% in the first quarter against an inflation in the first period of 4.3%, showing that our expenses are very much under control. So we started, we started off controlling our expenses, and this is our objective for the rest of the year. But we have to bear in mind that the strategic plan that is started in February 19 has a very small impact in that first quarter. So it's just natural that the impact will grow going forward, an impact that will be felt in technologies, new hirings, contingencies, you know, fiscal contingencies, et cetera. This will appear throughout the year, but this is what makes us certain that this line will go, you know, within the guidance.

But we will certainly do all we can to lower that number. We have to also recall the collective bargaining agreement. I mean, of course, that we have our own impressions about the collective bargaining agreement, but the negotiation remains open. I mean, if you look at the line of others and compare it with the same line, it's the same as other companies that consolidate with us, and this line is going back to its traditional level from previous years, without the effects that we had in the past two years. So everything is under control and normal. I mean, the collective bargaining agreement could probably move the needle a bit, but everything is being looked at and treated very rigorously. As Marcelo was saying, all the lines should be within the guidance.

Some lines are even above guidance, but we will see a balance between one and the other. Some will be closer to the bottom part of the guidance, and the others will be more closer to the top of the guidance. But we are certainly controlling our expenses and costs, but at the same time, always investing in what needs to be invested on. So thank you, and with now, we conclude our Q&A session. Questions that couldn't be answered in this occasion can be then sent to our IR department. And before I turn the floor to Marcelo to conclude this presentation, I would just like to say that in our IR website, you will be able to find this presentation and also all of the other materials related to this earnings release presentation. So I just recommend that you take a look at that.

So what are your final remarks?

Marcelo Noronha (President)

Thank you. Thank you, André. Thank you, Cassiano. Thank you, all of you, for your interest and for joining us today in this, you know, quarterly earnings release. We remain at your disposal. Sell-side, all analysts, we are available to give you further information. But before I say farewell, I would just like to say something. Yesterday, Carlos Alberto Rodrigues Guilherme passed away. He was a Board Member since last December when he retired. He was also Vice President of the Board. He died yesterday, but for several decades, he worked for our organization. That's why I thought it would be important for us to express our sorrow for the loss of our colleague that spent many years working with us. But I would like to remember him with joy rather than sadness.

André Carvalho (Director)

Thank you so much for joining us today, and I wish you all a very good month of May. Thank you.