SUPV — Grupo Supervielle S.A.

Summary of Grupo Supervielle's Q3 2025 Earnings Call

1. Key Financial Results and Metrics

• Net Loss: Grupo Supervielle reported a net loss of ARS 50.3 billion for Q3 2025, primarily due to macroeconomic pressures and high interest rates.
• Loan Growth: Real loan growth was solid at 8%, led by corporate lending, while retail loans slightly declined.
• NPL Ratio: The non-performing loan (NPL) ratio rose to 3.9%, with expectations to increase to 4.7%-5.1% by year-end due to economic pressures.
• Deposit Growth: Deposits increased by 15% quarter-on-quarter and over 40% year-on-year, with dollar deposits reaching a record high.
• Net Interest Margin (NIM): The peso NIM fell to 11.7%, and total NIM dropped to 10.8%, reflecting a significant decline of 1,100 and 1,000 basis points respectively.
• CET1 Ratio: The Common Equity Tier 1 (CET1) ratio was 13.2% at the end of the quarter, improving to 14.5% in October.

2. Strategic Updates and Business Highlights

• Strategic Initiatives: The bank is focused on enhancing customer engagement through its SuperApp and expanding cross-sell opportunities, particularly in the corporate segment.
• Cost Control: Operating expenses declined by 2% quarter-on-quarter and 12% year-to-date in real terms, reflecting a commitment to efficiency.
• Funding Strategy: The bank is extending its remunerated account strategy to deepen client relationships and strengthen its funding base.

3. Forward Guidance and Outlook

• Loan Growth Expectations: For full-year 2025, the bank anticipates real loan growth of 35%-40%, primarily from corporate lending, with retail growth expected to resume in 2026.
• NIM Forecast: NIM is projected to improve to 15%-18% as monetary conditions ease.
• ROE Guidance: Full-year return on equity (ROE) is expected to range between -5% and 0%, with a potential recovery to high single digits or low double digits in 2026.
• Asset Quality: The bank expects NPLs to peak in Q4 2025, with gradual improvement anticipated as macroeconomic conditions stabilize.

4. Bad News, Challenges, or Points of Concern

• Economic Pressures: The bank faced significant challenges due to high real interest rates and tight monetary policy, which compressed financial margins and constrained lending capacity.
• NPL Concerns: The rising NPL ratio reflects broader economic difficulties, particularly in the retail segment, raising concerns about asset quality.
• Regulatory Risks: The Central Bank's strict reserve requirements and monetary policy could continue to impact liquidity and growth prospects.
• Market Volatility: Local market volatility ahead of the elections affected bond prices, further complicating the financial landscape.

5. Notable Q&A Insights

• Loan Mix: Management indicated a shift towards a more balanced loan mix between corporate and retail segments, with corporate loans expected to dominate in the near term.
• Risk Management: Executives acknowledged the potential risks associated with high reserve requirements and the need for strategic partnerships or asset sales if conditions do not improve.
• Political Outlook: Alejandro Catterberg provided insights into the post-election political landscape, suggesting a more favorable environment for reforms under the new government, which could positively impact economic recovery.
• Liquidity Concerns: The bank is focused on improving liquidity conditions and is open to exploring international markets for funding if conditions allow.

Overall, while Grupo Supervielle faced a challenging quarter with significant losses and rising NPLs, there are signs of stabilization and optimism for future growth driven by strategic initiatives and potential political reforms.