Inter & Co, Inc. (INTR) Q4 2025 Earnings Report, Transcript and Summary

Hello, everyone. It's always a pleasure to be here and present the achievements of the quarter. We're proud to share another outstanding year of growth and profitability. Once again, we were the fastest-growing finance institution in Brazil among those with over 20,000,000 clients. This reinforces the strength of our brand and the attractiveness of our platform. Beyond attracting clients, we've seen them deepen their relationship with us. In December, we recorded over 21,500,000 daily logins. That's nearly 15,000 per minute, a significant increase compared to last December's 17,000,000 logins per day. Additionally, we've processed 32,000 financial transactions per minute, totaling almost 1,000,000,000 transactions during the month of December. This exceptional level of client engagement highlights how well our platform performs. With a sustained NPS of 85 points over several years, it also reinforces the value created by the synergy between our seven verticals, delivering a seamless experience for our users. Throughout the year, we delivered a record-breaking performance in both welcoming new clients and activating them. We welcomed 7,000,000 new clients, our best annual performance ever. This is an important achievement given Brazil's mature market where most people are already bankarized. Our focus on quality remains strong. Of these new clients, 4,400,000 became active, bringing our overall activation rate to 58% and our total active client base to 25,000,000. These results are driven by continuous improvements in our super app, from enhancing the onboarding process and client services to refining communication strategies, targeting, and hyper-personalization. We've worked to deliver a seamless and engaging experience for our clients. These higher activation rates are driving significant increases in transaction volumes. In the fourth quarter, our TPV grew 27%, reaching BRL 1,800,000,000,000 in run rate. Transactions made through PIX totaled around BRL 1,500,000,000,000 for the year, leading our PIX market share to 8.5%. Additionally, our transaction mix continues to evolve, with credit card volume outpacing debit card transactions for many quarters in a row. This shift positively contributes to higher interchange fee income. Importantly, our TPV levels across cohorts show consistent improvement as newer clients demonstrate increased activity, transacting faster and more frequently than other cohorts. On credit, before Santi deep dives on specific metrics, I want to highlight three main topics: portfolio growth, private payroll loans, and credit cards. First, on our portfolio, we achieved a remarkable 36% annual growth, being diligent with ROE targets and maintaining a balanced ratio of secured and unsecured loans, roughly two-thirds secured, one-third unsecured. Second, on private payroll loans, this has been the main highlight of the year, and we keep a positive view on the product. We reached a portfolio of nearly BRL 2,000,000,000 with around 500,000 clients. This shows the strength of our digital distribution and our ability to scale a new product quickly. Third, on credit cards, we're making good progress in moving clients from being pure transactors to our interest-earning portfolio, a process we call reshaping. IPs or interest-earning products now represent over 23% of our credit card portfolio, up from 19% last year. Fourth-quarter dynamics of more liquidity in the market brought stability to the reshaping process. Nevertheless, there is a lot of space to maintain the evolution we saw in 2025. Santi will provide more details on our strong loan book performance. Moving to the next page, we see another quarter of remarkable market share gains delivered. Our goal of replicating PIX's success in other products is underway, with home equity already ahead of PIX. This quarter, the progress is evident. Market share is expanding consistently across all of our I am confident that we'll continue strengthening our market position with more products surpassing the growth benchmark set by PIX. To finish, I want to highlight that these outstanding results are driven by our seven verticals and our ongoing commitment to continuous innovation. Each vertical plays a crucial role in fueling our growth, working seamlessly and interconnected to enhance client value and compound profitability. This powerful ecosystem is what sets Inter & Co, Inc. apart and propels us forward. Now I'll hand it over to Santi who will guide us through our financial results. Thank you. Thank you, Shange, and good morning, everyone. I'm excited to highlight

what has been one of the year's biggest achievements, our loan growth. It grew 36% year on year with quarterly growth accelerating to 10% or 40% on an annualized basis. Now breaking down by segments, first, on the real estate side, mortgages grew 48% year on year while home equity loans grew 35%. On private payrolls, we reached BRL 2,000,000,000 up from nearly zero at the beginning of the year. And third, on credit cards, we grew 29% with solid risk management and continued progress from the reshaping strategy driving monetization and profitability. Overall, our intention has been to deepen credit penetration and as a result, continue increasing monetization. Here, I like to highlight the evolution of our asset quality metrics, reflects how we are driving the outcome in terms of credit underwriting strategy. The fifteen to ninety day NPL ratio improved 10 basis points by decreasing from 4.1 to 4% while the ninety day past due loan portfolio increased from 4.5% to 4.7% mainly as consequence of the dynamics with a private payroll product in which the earlier cohorts have passed the ninety day mark and now appear in the metric. We anticipate this dynamic by upfronting provisions, which took our coverage ratio from 136 to 146% the first nine months of the year. Looking specifically at credit cards, NPLs continue to perform well, validating the continued improvements in our underwriting and collection models. Finally, NPL formation and Stage three formation were also impacted by the private payroll portfolio which began appearing in this status as expected. Our cost of risk closed the year at 5.3% reflecting 10 basis points improvement mainly led by strong performance of our credit card portfolio. Moving here to our funding franchise. We delivered another strong quarter of growth. Increasing 32% year on year and 7% quarter on quarter reaching nearly BRL 73,000,000,000. And an average balance of BRL 2,100 per active client. This growth throughout the year was driven primarily by time deposits even the high level of the Selic rate and the ongoing success of my piggy bank account. Our product that simplifies fixed income investing for clients. On the transactional deposits, we had a great quarter increasing 10% and passing the BRL 20,000,000,000 mark. In terms of loans deposit, this quarter we were able to deploy more capital in the funding growth thus resulting in an increase in our loan to deposit ratio, from 64% to 66% still having lots of room to put our excess liquidity to work. Our healthy funding mix continues to translate into a key competitive advantage our low cost of funding. Which remains an industry leading metric among Brazilian banks and fintechs. This quarter, our cost of funding stood at 65.6% of CDI, an improvement from the 68.2% of the prior quarter. What's notable is how this advantage has persisted even with the select rate remaining at high record levels for an extended period of time. This resilience showcases the strength of our funding strategy and reinforces our ability to operate efficiently across different macro and monetary conditions. Jumping into revenues, we delivered strong performance in 2025. With total gross revenues reaching BRL 15,000,000,000 marking an impressive 45% year on year growth. This magnitude highlights the scale and momentum of our business as we continue to expand. Net revenues also showed significant results. Growing 31% year on year reaching BRL 8,400,000,000. The standout driver behind this growth our credit portfolio. Which led to net interest income to increase 41% year on year. This acceleration was fueled by strong performance in payroll loans, credit cards, mortgages and home equity loans, all key segments where we have built significant scale and efficiency. On the fee side, net fee revenues grew 9% during the year. This growth was moderated by changes in accounting rules at the beginning of the year and increased monetization of some fee lines like Intershop, through net interest income by the introduction of the buy now pay later product. Jumping here to the unit economic side, higher client engagement is driving faster monetization across a efforts. Especially to private payroll loans the reshaping of our credit card portfolio and the higher transactional volumes. As a result, our net ARPAK reached BRL 35.1 our highest level on record. Our mature clients demonstrate even greater potential generating BRL 91 in net ARPAK further underscoring the opportunity ahead. By combining this strong monetization with our low cost to serve of just BRL 13.8, we achieved our best ever gross margin per active client, reaching BRL 21.2 this quarter. Now let's deep dive into our net interest margins. Both are NIM one point zero and NIM two point zero, which excludes the noninterest residuals of credit cards are consistently showing growth quarter after quarter and achieving new record levels. We have improved our risk adjusted NIM by an average of 15 basis points quarter after quarter. This particular quarter, earnings were positively impacted by two key drivers. First, private payrolls, which was the biggest contributor to its growth. And second, credit cards, which also performed well, as the reshaping strategy continues to show its results. However, we also faced few headwinds this quarter. The first one being lower inflation, which impacted our real estate portfolio income. And second, a higher number of business days, which increased our funding expenses. With all these results combined, our NIM expanded at twice the level of the prior quarters showcasing how consistency in our great underwriting strategy is paying off by allowing us to extract an increasing amount of value from our balance sheet. Finally, our assets to equity ratio, which increased from 7.9 to 9.4 showcases the optimization of our capital structure which is still highly under levered. Moving to the expenses side, Total expenses rose 25% on a year on year basis. On a quarterly comparison, we had three dynamics playing out. First, on the administrative expenses, it rose 8% quarter on quarter and 19% year on year, reflecting higher transactional volumes as our super app continues to scale. As our business expands rapidly, we remain focused on renegotiating contracts with major vendors, to further reduce transaction cost and improve efficiency. Second, on personnel expenses, it increased due to seasonal impacts from profit sharing provisions and the annual collective agreement, as well as due to the seniorization of our team. Despite these increases, headcount remains stable at around 4,100 employees, through 2025. And third, depreciation and amortization which grew 33% quarter on quarter or 85% year on year, driven primarily by one off impairment related to POS terminals. When we look at operational leverage, had another year of progress. As a result, our efficiency ratio decreased from 48.4% to 45.5% representing a nearly 300 basis points improvement within the year. These efficiency gains are a result of our digital approach, process optimization, and disciplined cost initiatives. And last but not least, I'm truly thrilled about the progress we've made on our journey towards increasing profitability. You can see on the page, this year, we reached BRL 1,300,000,000 in net income and surpassed our remarkable milestone of 15% in the last quarter. What stands out even more is the consistency of our performance which is clearly reflected in the chart. It's an accomplishment that fills us with pride and demonstrate the strength of everything we've worked on with discipline and consistency always in the pursuit of excellence. With our platform running better than ever before, and our virtuous cycle growing stronger and larger, we're very excited about the future that's around the corner. Now Joao Vitor Menin will take the stage for the final remarks. Thank you all. I would like to thank the team for the support on this journey. João Vitor Menin: And the immense effort they put day in, day out, that made these results possible. I firmly believe our platform is at the best moment ever which gives me a lot of confidence that 2026 will be another excellent year for Inter & Co, Inc. Now I will hand it over to Haf to open the Q&A session. Thank you very much.

Before opening the Q&A session, I'd like to invite everyone here to join us in New York City for our Investor Day on May 11. It will be an exciting opportunity to reflect on our incredible journey and share insights into the future we are building together. An RSVP will be sent by email. For those who can't attend in person, the event will be broadcast live. Hope to see you all there. Now let's start the Q&A session. Our first question comes from Mario Pierry. Mario, please go ahead.

Good morning, everybody. Congrats on the results João Vitor Menin: Joao, let me ask you a question and and to take advantage, right, that this is, like, annual results This is your second year following the guidance that you gave, the sixty thirty thirty guidance, when we look at the numbers, right, for for the first two years, the ROE is halfway there, 15%. You're guiding for 30. By 2027. The number of clients also you you are halfway there as well. However, when I look at the efficiency ratio, I haven't seen or I was expecting faster progress on efficiency. In this quarter, right, when we look efficiency deteriorated, So let me ask you, like, how are you feeling about your thirty thirty plan? Do you you know, do you anticipate making any changes on this guidance on on this Investor Day they just announced on May 11? And what can you do on efficiency to to make sure that, it's it starts heading in the right direction? Because that's the main pushback I get from investors. Is the slow progress in the efficiency ratio. Thank you. João Vitor Menin: Okay, Mario. Thank you for the question. I will try to to answer everything. So first of all, important to mention, we unveiled our six thirty thirty plan three years ago. It was a it is still a five year plan, and we're happy that this first three years were a tremendous success. Just to recap what you just said. Moving from 0% ROE to 15% today. From 25,000,000 clients back then to forty three forty three million clients today. The efficiency started at 73% today right at 45%. And also important to mention, since then, Mario, we more than doubled our credit portfolio. From BRL 22,000,000,000 to BRL 48,000,000,000. That said, we are convinced here at Inter & Co, Inc. that the deep banking model which by the way we invented ten years ago, is ready to produce growth ROE, and efficiency according to the goals of this plan. This is very important to highlight. I also believe that on our our fourth year of the plan, 2026, will be a great year in the direction of getting closer to this KPIs. We're very committed to that. Regarding the the time when and how we'll get into each of these specific targets, clients, efficiency, and ROE We will go to deep dive and to explore that more on our investor day in New York. Which I this opportunity here to invite everyone to attend. They are in Nasdaq or digitally. Connecting to your other question about efficiency, what do we see that could help us on that topic? We mentioned the in our earnings, on the presentation, the deck, some efforts in terms of technology, in terms of innovation, and in terms of AI. We do believe that Inter & Co, Inc. is very well prepared, Mario, to get all the benefit from these new things in in technology and innovation that are jumping in. We believe that we have all the data. We have all the the back end, all the cutting edge technology to help us on the on the expense side. And last but not least, as Santi always like, to say, our goal is to always grow our expenses We are still a growth company, just remember, but we will grow our expenses less than our than our revenues producing operational lever. Thank you very much. Bye.

Thanks, Jerome. Let let let me let me follow-up just on what you said at the end. Right? You are a growth company. So let let me and you continue to consume capital. So let me ask about the strategy of paying dividends. And why why I know you paid last year as well, but how how do you look at dividend payments and and given the capital levels that you have today? And, right, if you're growing your loan book 36%, your ROE is running at 15%. Right? It means that you should continue to consume capital So can you let us know, like, what to expect in terms of future dividend payments? Thank you. João Vitor Menin: Mario, that's an excellent question. So just to recap, we have been paying dividends on a 20% payout ratio for the past three years in a row. We believe that this should be the the trend going forward. As long as it does not impact execution plan and the growth of the business. Regarding the capital, I'm going to to pass the the mic to to such that we'll cover how we balance growth, portfolio, dividends, and capital at the bank level and at the holding level to keep running the business. Santi, please, if you could jump in.

Thank you, Joel. Good morning, Mario. So on the capital, just to to reiterate, we have two levels of capital, the bank and the holding. At the bank level, we have 14.4% And this past year in 2025, we were able to optimize that capital structure through the issuance of tier ones and tier twos. We are in a more evolved version of working with our capital structure. On top of that, we have around BRL 2,000,000,000 of excess capital at the holding level, is around 4.5 percentage points of CET one, which combined with the local CET one that we have at the bank, gets us a CT one of roughly 19%. So we're still in the in the phase where we consume We we agree with that statement, Mario, but is at a lower pace quarter by quarter, and we are reaching we're closer to reaching the capital neutrality. But we want to move the excess capital from the OpCo to the Holco, given that it's more profitable have it at the holding level. That was done by design, you back in 2022 when the holding was created. So it's moving as planned. Thank you.

Our next question comes from Tito Labarte. Tito, please go ahead.

Hi, good morning. Thanks for the call and taking my question. Maybe following up

a little bit on Mario's question because, yeah, I mean, if I think efficiency is of it's one of the key question marks we get also. Particularly, I guess, on on fee income, I know for the full year, you had the Interpag consolidation. Right? But if we look now yeah, on a year over year basis for the quarter, that that should be behind, you know, yet fees did not really grow significantly. We do see fee expenses have been a bit of a headwind. Just to understand, you know, why sort of that spike in fee expenses, what should we expect on fee income from here? You know, when do you think it starts to grow back in line more with with loan growth? You know, why we're still seeing some headwinds there? Thank you. Hi.

Thanks for the question. This is Shange speaking. So on fee, I think there there are a few topics to talk about. Right? First is the fee income ratio itself. Finished at 25% last year. So that's a compression comparing to the 30% of 2024. And it's a in a way, I see it as a good problem to have. So NII expanded a lot. We had 45% growth, in the net in in the NII part. And that ended up compressing a little bit the fee income ratio. As we move to the the nominal numbers in fee income, so what we saw in the fourth quarter was a solid quarter at $5.79, million and and with a few positives. So cards, TPV, the year grew at, like, more than more than 15%. The investments business was strong, so have the 27% growth in AUC, BRL 8,700,000. Active clients, more than 10,000,000 insurance contracts. So the insurance business also coming good. So these are positive highlights And, as headwinds, we did have some. So Intershop was in a way under pressure given all the the everything that the Chinese players are doing in in the Brazilian market. So that was a pressure. Although despite that, we saw a positive number in terms of active clients. We see Intershop a lot as an engagement engine for clients to bring primary bank accounts through Intershop. So it's very important for us. And we did see a 3% increase in active clients in the despite the pressure on the revenue side on Ethershop. As we as we think about the overall numbers, we saw last year a growth of about 9% in the in the nominal total fee income revenue. If we take a few one offs that we had, so we had a few one offs related to capital gains in 2024 and 2025. That would add about three percentage points in the number. So that would bring us back to around close to 13. And if we add back resolution four nine six six from the Central Bank, the changes that we had to implement on that we would back to be back to, like, a 15% growth which would be much better. So this would, like, kind of normalize the growth in 2025 to the 15%. And what we're doing is many, many initiatives to ring to engage clients more with the different products. So gonna go back to, like, hyper personalization, We're implementing different solutions to do conversational sales both in app and out of the app, thinking app, solutions like WhatsApp, so that we can sell more fee income related products and reestablish growth we see good perspectives here thinking about 2026. Thank you. Thanks, Andy. No. Very helpful. May just a follow-up there. Just

if we look at, I guess, the interloop expenses and expenses from services commissions. Right? I mean, those are a bit of a headwind Right? One was up 34% in the quarter, and expenses from services and commissions up 10% in the quarter. And is that where you're seeing sort of that pressure from from the Chinese players from an inter shop? And just how how should we think about that that growth in fee expenses from here? Is is there room to improve that?

So, Tito, a lot of that is, is related to to it it we say we see it as a good expense. For example, loop is an a big engagement power. That we're using with our clients, a lot of campaigns to activate and bring primary bank accounts Also, in in many ways, we're using cash back to incentivize the sale of credit So this is to say that we do keep an eye on the number on the expenses themselves that are related to fees. But we are optimizing in the end for net income to use the tools that we have to sell more and and expecting a better bottom line in the end of in the end of the equation. So that's a little bit about what we see there. And specifically on loop is something that we are very enthusiastic about. Because it's one of the main it is our it is our loyalty program that it's evolving a lot. We're bringing a lot of clients in the base to use it. And as they use it, they typically became use us as as their primary banking relationship. So that that's our view on that number. So to summarize, we are we we do keep an eye on it We'll keep it under control, but we'll keep using it to optimize sales and and growth in the different products.

Our next question comes from Yuri Fernandes. Yuri, please go ahead.

Thank you, Rafa, and congrats, Shuao, Shandi, Santi for the step by step, like, the improvement on margins ROE. I would like I would like to ask a little bit about maybe the elephant in the room, at least from my my conversations here with investors regarding provisioning And I know provisions versus bad loss formations in Stage three or NEPL they can be volatile Right? And I think there was a a usage of coverage this quarter that may have helped your your EBT And what we did here was to try to look by product just to see which product stage three formation is worsening how you are building provisions for those products, And it was not credit cards. That usually I would say, is the bad guy, is the villain for for for a little bit of the past quarters. This quarter was a little bit personal loans. We we saw an increase in stage three formation for personal loans. Also, you're building a little bit of less provisions for this product. And the same is true for real estate. Real estate also was was low, This is not new, but I think you have collaterals there. So I I I think it's it's it's a, let's say, a safer product. So if you can explain what happened with the formation this quarter How should we see the cost of risk? How you how should we think about coverage? Just trying to you know, because I I think, like, a little bit of the pushback is that you did less provisions versus formation. And my answer here has been that you did more in the second quarter and the third quarter. Just trying to understand the moving parts here. Thank you very much.

Good morning, Yuri. Thank you for the question. This is Santi. Take that one, and I'll answer it. Don't worry. On general terms, touching the the points that you you you touched on. So first of all, the asset quality of our loan book is performing as planned and consistent with the credit underwriting strategy that we are executing. So we look at the mix. We look at the growth levels. And how it evolved quarter by quarter. The picture that we see on asset quality now exactly the one that we anticipated. No? Going now portfolio by portfolio, private payroll, The they are the initial cohorts of these products are starting to mature in the past the the ninety day mark. And that explains how they came into the into NPL, no, increasing, and also on the NPL formation and safety formation ratios as well. The the performance or the the monetization of this product more than compensates this level of delinquency. So we we're happy with the ROEs that we're seeing there. Might does take a toll, you know, when you look at specifically at this credit quality metrics for this product. On credit cards, as you as you mentioned correct, the performance was actually pretty good on the fourth quarter. It typically is good on the fourth quarter with more liquidity in the hands of of of the clients that have this product, and and they tend to get a bit more up to date on the fourth quarter. So performance there was was pretty good. SMEs, no no material change quarter by quarter. You you know this is mostly invoice discounting, so it's it's quite steady through time. On mortgages and home equity, you you you flagged it well. We had there an increase on stage three balances. Due to a more conservative integrated view of our clients, Let me explain that, what I mean. That until the third quarter, we did keep mortgage loans that were paid on time in their respective stage not considering credit deterioration, events concerning the same client, and different products. But starting in the fourth quarter, if a client has a performing mortgage, has more than ninety days overdue in other credit lines, also migrated the mortgage portfolio loan to state three. This change was made in a cumulative manner accounting for the full balance during this single fourth quarter and resulting in an extra BRL 140,000,000 of stage three balance on this real estate portfolio. This is a a catch up that we did in accordance of having the best practices in place and and in line with a series of initiatives that we are implementing with our new CRO has been helping us in this front. We would have adjusted these phase three formation factor from the mortgages, the the formation would have been 1.65%, which is flat versus the prior quarter. Now going into into 2026 to answer your question on on how should we see cost of risk. Continue evolving with a mix a credit mix, in line with the one that we had in in 2025, which is something that we will see because we try to capitalize on the opportunities as they come along. But the way we're seeing it, it shouldn't be too diff in terms of credit mix. '26 versus what it was in 2025. We'll be operating with a cost of risk is which should be between 5.56% depending on how the the things play out. There's a general expectations that asset quality in the industry as a whole would have a bit of a pressure. That would take us maybe closer to a 6%. If that doesn't play out in with with a lot of intensity, would would be closer to the 5.5%. And, as we always say, the goal that we have is to maximize the risk adjusted NIM, not to minimize the delinquency levels, and to do that by offering products that are healthy for the clients too And with that, we don't need to churn the clients very fast over time. We have a product that adds value to the economy and to them and to us as well, given that the ROE of these products is very accretive. I hope I answered it. Was it a bit longer? Was it was a very good

Sante. Thank you very much. And I I I think, like, I would just repeat and and and make sure I got it all right. So the 5.5 to six, I I think it's in line with expectations. I think the company has been saying that those those numbers in the past Regarding the quarter per se, there was a a one impact on real estate portfolio. Without this impact, on this adjustment of risk models. Your stage three would be mostly stable a quarter over quarter, and you should help on the formation. On a general view, you are not concerned about asset quality. Fifty to ninety days, the link was are improving. And, basically, risk adjusted margin that I think it's a good metric. They they also behave well. Is this a good summary, essentially? Am I missing something here?

Excellent. Spot on. You, Yuri.

No. Thank you, Santi.

Our next question comes from Pedro Ledouki. Ledouki please go ahead.

Thank you so much for taking the question and congratulations on the year's achievements everybody. On on private payroll, if I may dig deeper into it now, BRL 1,900,000,000 also very good. Number. And the first part of the question is if you can help us understand this growth is coming from it's been changing since the beginning, in terms of channel kind of tickets, rate ranges. If you expect essentially this origination pace to continue or change in 2026. And then the second part also related to private payroll. And I think there's a a comment about, like, high single digit 10% NPL ratio to to the press earlier. If this is more of the levels that you're seeing in in 1Q or was it in 4Q, Which harvest are this and if it's aligned and and if you're making any adjustments there? Thank you.

Leduc. Thank you for the question. This is Sean speaking. So when we look at the private payroll loans, I think they was a new product that that we had, that the market had. We're obviously very, very happy with our execution in 2025. We we're positioned to be one of the winners for sure in the market So as you mentioned, around BRL 2,000,000,000 in credit portfolio, 500,000 clients, average ticket, about, BRL 4,000. In the ballpark of BRL 4,000. Interest rates are relatively stable since the beginning at 3.7% on average. And usually on average, clients taking their credit in for to pay in 20 installments. Market share, we're at about 5%. We do see room to increase on that. But this share is very aligned with our strategy. We want to and and we've been saying this since the beginning. We want to see the product mature. We are getting maturity in the product. We know that there are many, many steps that Dataprev who kind of controls the the product still needs to implement. So we wanna see this development to to increase our originations. So this is the the overall view The product just a couple points to add. Has been bringing a lot of clients that we already had in the base that were inactive. They're back to active. The ARPAK that we see on these clients is about three times the average RPAC of the company so very positive as well. And it's also also bringing cross selling. Right? So the the cross selling index that we measure is 20% higher on these products. From looking at the channels it is evolving. So for now, we we are operating the two channels One is the CTPS app, which is the the the government app. Clients can can look for the different options. And take the one they prefer and sales through our own app. In the beginning, we saw a lot of volume coming from CTPS, less volume coming from the app. Right now, we're at about fifty-fifty. And we we believe we're gonna keep gaining share against CTPS. So the the channel that belongs to Inter & Co, Inc. is gonna become more and more the preferred channel for clients, especially when people start to do refinancing the refinancing process and other movements. And we're also adding in probably in the first quarter the conversational channels also. So we're gonna be selling private payroll loans through WhatsApp and other conversational channels, including our own our own conversational environment inside the app. That's that's on that. And and thinking about delinquency, what we're seeing and we've discussed this several times in the earnings call. Since we started the product. We planned initially for a brow a for a delinquency that should go up to about 15%. We don't see that. We see a lower delinquency than that, but we do see delinquency converging to higher than 10%. How do we bring it back to six, seven, 8%? By seeing all the introduction of all the collection solutions that are in the original design of the product. It's gonna be very important, to see this development in the upcoming month And I see and if that happens, not only we're gonna see the the reduction the, like, the the the reduction in the in the NPLs, we're also gonna see an increase in the volumes underwritten by the market We're going to see reduction in rates So it's gonna be a I'd say that it's already a good product, but it's can be a much better one for the Brazilians.

Very complete. Thank you, Shanu.

Our next question comes from Gustavo Schroding. Gustavo, please go ahead.

Hello. Good good afternoon, everybody. Congrats on the recent achievements I mean, the last three years. So my question is is regarding, some expectations for 2026. Sunsha already anticipated in terms of a cost of risk something around the 5.5 to 6%. If you could give us any color regarding loan growth net interest margin and efficiency ratio performance in for for 2026? I mean, should we continue seeing this loan growth around the 30, 35%? Net interest margin still has room to expand in 26%, and I there is, what should they expect in terms of, efficiency ratio improvement in in 2026? Thank you.

Hi, Gustavo. So first, I'll say that we we don't give guidance. We don't provide guidance, so that's important to to be on the record. What I can talk is about general trends. So first, going to '26, looking at '25, there are a few things that were particularly proud of. One is loan growth. We have been saying to the market that we were sold in for '25 to '30, and we closed at '36. This was a consequence of chasing the opportunities that came along, and and we did that with a lot of enthusiasm, and and the results were were pretty good. And the other one would be NIM expansion or risk adjusted NIM expansion. A very good performance throughout the year and particularly in this fourth quarter. Then the consequence of those two together is the credit penetration of our clients went up $1,700 average to $1,900 in average, and that's very important for our back and monetization of the client. So that that's how we're finishing 2625. For '26, in terms of loan growth, we still think that twenty five to thirty is a reasonable target for us to be chasing. The base is is bigger, and private payroll, which was something that that came from zero, is is not present. We must be starting with a balance close to BRL 2,000,000,000. We hope to be on the high end of the range. Of that 25 to 30% and and and hopefully even beyond as we we did in '25, but we would see as we go along. In terms of NIM expansion, the fact that we continue to reprice the back book of the portfolio and that we are on the margin allocating more credit towards private payroll and and credit cards. That could have a further expansion on on the NIMs trends that we have been seeing. So we continue to see risk adjusted NIM moving in the same direction, which is in line with what Joel mentioned for 2026 in in his opening remarks. And then on efficiency, this is a core goal for us. A a point to highlight is in '25, you see a delta of growth in revenues versus the delta of growth in expenses, we had close to 10 percentage points. When you take out Interpact from 2024. Remember that we integrated Interpact in the middle of 2024. Therefore, the annual comparison need to clean up a bit the numbers to make it fair. And and with that cleanup, we have 10 percentage points of additional growth in net revenues overgrowth. In expenses, therefore, resulting in the operational leverage improvement. We see that playing out again in '26. We'll see what the the the level of of top line growth is, but we should have a similar delta terms of growth in revenues versus growth in expenses. And, therefore, continue improving our efficiency ratio in in line with what we have before. There are several efficiencies in AI that are still early stage, and those could could give us some upside. Those are present in in CX customer experience, in fraud, in credit underwriting, and in coding, So approximately 80% of the AI improvements that we've had so far on on cost but a lot more there is to come. And we're a bit earlier in the in the cycle with with the revenue increase as a consequence of AI. But we have several initiatives that are being as very exciting. One is hyper personalization of pricing. Which is a very tailored pricing for on a per client basis. Hyper precision of the app, which we mentioned in our investor in our tech day, back in 2024. Now it's a a lot more evolved. And the task bar, which is a different way to communicate with our clients and increases the cross selling of our clients. So a lot going on in in terms of optimizing AI in the spirit of having more operational leverage. But the trend, as as Joe mentioned at the beginning, is a continuation of the of the NIM expansion, a continuation of the improvement in efficiency, and therefore, the ROE continue to move in the same direction.

Great, Santi. Great. It's a it's a super helpful And if I may, just a follow-up on the on the Duke's question regarding private payroll loan. It is more on the competition front, right, because although we we recognize that it is main there is a a lot of room to grow in this segment. It's a large market or addressable market here, but, we've seen at the same time mean, I would say most of the banks that we talk to leased and then nonlisted, they are, I mean, super aggressive in this in this segment. Right? So maybe exclude one or two, but most of them, are aggressive. So my question here is, what is the competitive advantage of Inter & Co, Inc.? How to compete in this segment? And, I mean, how how to, let's say, keep growing at the same pace without any, let's say, impacts on prices or delinquency ratio. Thank you. João Vitor Menin: Gustavo, Jean Vitor here. I'll take this one. So first of all, about the competitive advantage that you mentioned, we have always been saying that that we have First of all, a lot of clients digital clients. Therefore, our distribution channel is always an edge. Also, we have the best funding cost in the industry. Also, very important advantage, competitive advantage. And last but not least, on that front, the private payroll not cannibalizing other revenues, other portfolios that we have. So again, this is also opportunity for Inter & Co, Inc. Talking about the pace of growth and how aggressive going to be throughout 2026 and 2020. You all know for ones that follow Inter & Co, Inc. for a while, we have this this this always want to grow fast, but we want to see how collateralized a portfolio is how the delinquency will play out as as Sanjay mentioned. We want to see all the improvements from data to make that we have the collateral of the of the future flow of of of payroll of this these specific clients. So we are proceeding with caution. I always like to to enter into a new segment, to a new market, to a new loan portfolio. And I believe that is the right approach. And that said, because of the of the first part of the question, the our competitive advantage, we have been able to produce a BRL 2,000,000,000 portfolio in one semester of 2025. That's how how I see the the the our our ambitions and our and our our expectations and and excitement with this product. And and last thing, just to to recap everyone and to and to to emphasize, we do love what you call the inter by design concept. So that bring the best price the best collateral, so it's a win win situation. It's good for the the client good for our our our our balance sheet. It's good for for for the for the is good for the regulator. So we do put a private payroll on that specific on this very nice niche as as we speak. Okay? So that's how we we see the the product going Very excited with it.

Our next question comes from Neha Agarwala. Neha, please go ahead.

Hi. Congratulations on the steady progress. Just a few questions. Sorry, but I would like to go back to the private payroll question and ask it maybe slightly differently. In the last six months, you've seen strong growth in your portfolio. But now, since the beginning of this year, end of last year, we are seeing the other incumbent banks, being more interested, and active in this portfolio. Has that impacted your January originations at all in terms of the amount of origination or the rates. And the the takers of this portfolio are mostly your own clients. So is the is the growth coming most from mostly from cross selling? Or are you going more to the open market and acquiring customers using this product you can give us a breakdown, that will be helpful for us to understand. How much, how long, and at what rate can growth be sustained, and then I'll ask my next question.

Hi, Neha. This is Shadi speaking. Thank you for the question. So we're seeing so we keep seeing interest So the year began, we it's a good year. Clients are learning how to use it. This product is for sure gonna be in the culture of the Brazilians, of the Brazilian in the that work in the private in private businesses. So you know that public employees already had one, Private employees did not have one. Now they have it is the lowest cost option for whoever needs a credit. So the beginning of the year, we see volumes growing. So very good beginning of the year. And as we mentioned already, we're gonna keep our appetite and it's gonna evolve as we see improvements coming from Dataprev. Thinking about the distribution channel, where it's coming from, what types of clients, we do see a mix of everything. But it's a very nice mix. Why do we see a mix? First, say about if we divide it into three parts, we see about one third coming from active clients, where we're cross selling and selling them the private payroll loans. Then we have another third that we are taking inactive clients and activating them through private payroll loans, then we have another roughly one third of the base of originations that are new clients. So they come to Inter & Co, Inc., and most of them open an account and become an active client, not only in the private payroll, but also in other products. So it's a it's great. It's a great mix. And we see it as a healthy one also. Because because our channel is working, our clients are engaged, it's important to see that happening. We can reengage clients. Also important to that happening. A lot of times people may think, oh, you have a lot of a lot of clients and the activation 60% of around 60% of the total clients. What do you do with the other 40%? These types of things. So selling payroll loans is one of them. And we have private payrolls as a as a new way, as a new CAC, as a new way of bringing clients in. Which is great. So, did I cover everything?

Yes. Yes. You did, and it was very clear. Thank you so much, Aditya. Now my next question is on if you can briefly talk about what would be the impact of lower rates. And how could this impact different loan segments that you have Not numbers, but just trend wise if lower rates would help you boost growth in any particular lending segment. Towards the second half of this year? And, any impact on margins from that? And last question is more for Joao about the global expansion. You talked about the license being approved. Could you give us a bit more details on what license is this? How should we see this global expansion manifesting on the p and l? Which lines would we see the impact especially that some of your other peers also looking to go into The US market How do you see competition evolving? How is your strategy different from the others? Any any color on that would be Thank you so much.

Neha, hi. Sandy here. I'll answer the one on rate sensitivity and pass it to Joao to cover the the one on on global parts. So on ALM and interest rate sensitivity, our goal has been to decrease volatility of the p and l. So we manage ALM with the intention of decreasing volatility and and letting the NIM evolve as we deploy capital in the portfolios that as we have been doing. So this is something that we we know what we're very good at, and we know what we don't wanna be good at or we don't have expertise. And taking directional bets on interest rates is something that we prefer not to do. So we try to keep volatility to the minimum. In the short term, a reduction in the interest rate would be positive for us because we have more liabilities that are short attached to CDI than what we have on the asset side. So in the first six to nine months, we would have a a positive impact, but then that would catch up given that the loans get get repriced. And, also, we have a loan growth of 25 to 30, hopefully, even more than that. And all of the new loans will be originated at the new level of interest rates, which would be lower than the current one. So that that effect would that initial positive effect then be compensated by some compression thereafter, and therefore, we would be converging to to a new rate. So all in all in, we think we are neutral to interest rate sensitivity. By design, we have hedged the longer portfolios to get to this neutrality, you know, so what what is long in terms of inflation and and fixed rates, we we would make our gaps or or risk factors neutral, and therefore, we can continue seeing the evolution that we have on the names more of a consequence of how we deploy capital from the macro movements on interest rates. I'll pass it to Joao for the second one. Yeah. So, Joel speaking here. Regarding the the branch that was approved few weeks ago, first of all, we're very happy and proud of that. We have been working for more than a year on that for more than one year on that license. As you ask, it's a a branch license. Approved both by the Fed Federal Reserve and the OFR. The Florida banking re regulator here on the state of Florida. With that in place, we will no longer rely on a bank as a service approach to offer checking account investments account here in US. With that in place, we have I would say that we open, the room for us to grow I like to say from the inside out. Have been building our our platform, our ecosystem in The US for two or two and a half years. So with the remittance, commerce, loyalty investments, checking account, debit cards, credit cards, And with the branch in place, we can really also mortgage. I forgot the real estate products. We can really offer this five, six different products, different verticals to millions of clients in different geographies. So for Brazilians, for Argentina that are launching also for Americas and other other geographies. So it's really an important milestone on our global expert. Expansion front. And I do expect a lot more volumes, fees coming from our global expansion front going forward. Very happy with that, and I'm sure that as a as a a very innovative platform, we'll be able to deliver this this many different features and products to millions of clients across the globe. You very much for for for for the question that matter. Yeah.

Thank you so much, Joel. That is very clear. Just to clarify the focus and the user base that you have right now is mostly focused on the on on the Latinos, like the Brazilians, Argentines, that you mentioned. There probably may be some Americans, but that's not the key focus segment at least as of now. João Vitor Menin: Yeah. As I mentioned, with that in place with the branch and then with all the products, all the foundation that we have built, we can serve millions of clients international clients, with all this full stack of of of products. But, also, at the end at the end of the day, we can also serve Americans that live in in in in in in have business here in US. So it's not one client one segment, the other. It's just a matter of we believe that the pain point that we saw with this this super app approach in in a US dollar dominated denominated account, we can serve more of of immigrants and Latinos than Latin America clients than US based clients. But, again, The US base, they will also be able to use our platform. They are able to use our platform as we speak today. K. So this is the the target and the the type of clientele thing that will be serving at first. K?

We have time for one more question. Our last question comes from Marcelo Mizrahi. Marcelo, please go ahead. Marcelo, your mic is open.

Aloha. Aloha. Are you listening?

Yes. Please go ahead. Okay.

Great. Thank you. I I have two questions. So first is, regarding the investments outside Brazil. How these investments needs are ready? Impacting the expenses. I mean, if you how many points could be better in terms of efficiency without that? Or another way to to ask that is where are Inter & Co, Inc. now in terms of the offer of products? So the the account in US is already open, and it's possible to the clients to use. How, ready is this account this product to choose which you start to to believe revenues. In US? First question. And the other question is regarding the the growth of the portfolio. I mean, so you guys were adjusting the models in credit cards we were seeing, recently an acceleration in credit card. Just to understand, how comfortable you guys comfortable you guys are now to to the pace of the growth of the credit card. Especially. So we were seeing better numbers recently, So if if it's possible to see an acceleration of the growth of the credit card, which is was this year last year was 29% of growth. Higher than 02/02/2024. So just to understand the strategy looking forward. Thank you. João Vitor Menin: Marcel, thank you. Jean Vitor speaking. I'm gonna cover the first one, the first part from the international expansion, then Shange will cover the credit card business. So as as I I mentioned before, Marcel, we have been working for the past two, two and a half years to implement in our platform the remittance product the checking account product, the broker dealer the investment products through the broker dealer, the mortgage and home equity product to our mortgage lending our commerce solution through our Intershop US, and our loyalty program here. That said, we are almost ready to offer everything that we offer for Brazilians there with our super app. Here in US for Americans, for Latinos, and also the most important we are ready to start offering this full solution, this comprehensive banking financial solution to millions of clients in different geographies. Important to mention that with our super onboard, and so it's easy for people in different countries to embrace and to open account and start using our products. We can really grow fast in in other countries, only in in US, Brazil, and Argentina without deploying a bank license, deploying capital over there. So it's just doing the soliciting of these clients that are there and wants to have this US based account for investments, transactions, and and payments, so on. Regarding the the the the expenses that we had to implement this this foundation in US and how much it does impact our efficient. Of course, it does impact because we are growing, we are innovating, and that how Inter & Co, Inc. likes to think. We always want to be cautious on the on the on the returns that we have, but we also want to keep building the future of the of the business. And this is exactly what we did with our global expansion in this last two and a half years. Most of it we have a red we had a red gone through that, so the expenses are are almost there. I we don't have a lot to to to build, a lot more to build. Now on, it's just a matter of how much you want to spend in CAC in acquisition of clients compared to how much these clients will be generating revenue for us. So it's expenses that will grow accordingly to the volume of revenue that you'll be that you'll be bring that you'll bring from this this this this clients going forward. Okay? And now, Shand, you talk about the the credit card business.

Thank you, Raul, and thank you, Marcelo, for the question. So when we think about credit cards, the strategy we decided to execute make it a a profitable and maybe a a very profitable business is the the reshaping. So it's all about improving the risk reward equation. Right? And to improve the risk reward equation, part of it is increase the interest earning portfolio. What we saw in 2025 was was a very good evolution. So we see that, let's say, a first year of the mission accomplished So the interest earning portfolio grew by four percentage points in twelve months, and increased with that a lot the the interest income from the product about by about thirty five percent One thing we expected to see was that as we helped clients serve the debt when they're when they have when they have problems, installments. We expect that you'll see better delinquency and we did see that So, our delinquency levels for credit cards alone was about 10% better than what we expected internally. So so it was it was a good number there, a good evolution there. And as we move forward to 2026, we wanna see continuity. So we want to continue this process It decelerated in the fourth quarter, for because we have a lot of liquidity in the system, so it's natural for us that that happened. And the year started well. In 2026, has everything to be better than 2025. Why is that? So the the the key reason is that most of the products we had to launch to make it happen were launched through 2025 So we start the years the year with the products launched and getting mature. So that's that that these are key reasons to believe that we're gonna have a better year. From and finally, from a growth perspective, we were not yet increasing the risk appetite We're still executing at the same risk appetite, but improving modeling, improving the onboarding models, improving the the behavior models that we use, and also through the MyCredit journey that Ron talked earlier. So this three let's call these three strategy. So onboarding new clients, improving approvals on behavior clients. And my credit journey is our strategy. So the appetite is defined, and it's all gonna be a matter of good execution through the year a lot of growth strategies, a lot of conversational sales, as I talked earlier about other products, going to be the strategy we should see good growth from the credit card portfolio in 2026. And to your point, 2025 was better than '24. We should see 2026 Thank you.

This concludes our earnings conference call. I'll pass it to Jean for his final remarks. João Vitor Menin: Thank you, Hafel. I'd like to thank all the employees at Inter & Co, Inc. working hard harder, every single day to help us to achieve our goals, to improve our platform, to improve our business. Also, I'd like to thank all the shareholders that have been supporting us for a while on this amazing journey. You very much, and hope to see you all in our Investor Day in New York City. Thank you. Bye bye.