Good morning, everyone. Welcome to the Grupo Supervielle Third Quarter 2022 Earnings Call. This is Ana Bartesaghi, Treasurer and IRO. A slide presentation will accompany today's webinar, which is available in Investors section of Grupo Supervielle's Investor Relations website. Today's conference call is being recorded. [Operator Instructions] Speaking during today's call will be Patricio Supervielle, our Chairman and CEO; and Mariano Biglia, our Chief Financial Officer. Also joining us is Alejandro Stengel, First Vice-Chairman of the Board and CEO of Banco Supervielle. All will be available for the Q&A session. As a reminder, today's call will contain certain forward-looking statements based on management's current expectations and beliefs and subject to several risks and uncertainties. I refer you to the forward-looking statements section of our earnings release and recent filings with the SEC. We assume no obligation to update or revise any forward-looking statements to reflect new or changed events or circumstances. Patricio Supervielle, our Chairman and CEO, will start the call discussing our key transformation initiatives and our past profitability. Afterwards, Mariano Biglia, our CFO, will take a deeper look at our performance and near-term perspectives. This will be followed by a Q&A session. Patricio, please go ahead.

Thank you, Ana. Good morning, everyone. Thank you for joining us today. Please turn to Slide 3 on our earnings presentation. We continue to execute on the key strategic pillars of our strategy designed to improve return on equity, while operating in an increasingly adverse macroeconomic environment with loan demand at all-time lows. Inflation hit its highest level in decades, landing 22% in the third quarter, while interest rates hiked 23 percentage points. In this context, we are moving ahead with the rightsizing of the business and the ongoing transformation of our branch network, driving efficiencies, while enhancing the customer experience. Integrating our consumer finance, customer base and back office into Banco Supervielle is on track, and we expect to complete this process in the fourth quarter of the year, along with seizing the majority of IUDU's operational efficiencies, we're offering this client segment a seamless omnichannel experience through which they can access the bank, broad assortment of financial products and services. We also gained traction in transforming our branch network, driving increased productivity. We entirely transferred our financial agent business, including 18 low-performing branches that service the government of the Province of San Luis while continue to serve a strong private client franchise in this region through a combination of five branches and virtual hubs. Seeking additional operational leverage, this month, we filed a request with the regulator to close another 14 branches, reaching a total of 28. We expect to finalize the merger of these branches during the first quarter of next year. We continue to prioritize customer acquisition and cross-sell to gain share of the target [de Narvaez] and I will provide an update on this shortly. Improving asset quality and funding are two key pillars of our strategy, where we are also advancing despite the challenging…

Thank you, Patricio, and good day, everyone. Please turn to Slide 5. We reported a net loss of ARS560 million, a reduction from the ARS2.1 billion loss in the second quarter. The main line items and drivers contributing to the sequential improvement included. First, 7% increasing net financial income, equivalent to ARS1.7 billion, mainly reflecting higher market trade. Second, a decline of 11% in personnel expenses or ARS1.3 billion as increases wages were ramping up to anticipate accelerated inflation in the quarter, reducing salaries in real terms. Efficiencies per headcount reductions, as Patricio discussed, also contributed to lower costs. And third, a 34% drop in loan loss provisions equal to ARS1.2 billion that mainly reflected on the asset quality. These benefits were partially offset by a sequential increase in income tax of ARS1.6 billion, reflecting a higher taxable income based at subsidiaries and higher inflation negatively impacting IUDU's tax loss carry forward. Turning to Slide 6. Total loans for the quarter increased below inflation, reflecting the impact of accelerated inflation and the consequent weak credit demand across segments. Our overall loan performance was in line with the industry trend when excluding the financial agent business that serves the government of the Province of San Luis. Notably, total loans at IUDU contracted 16% sequentially as we continued to slow down originations in an increasingly inflationary context, resulting nearly a percentage point sequential decline in the weighting of consumer loans over our total loan book. Moving on to funding on Slide 7. Total Argentine peso deposits in real terms declined in the high teens sequentially as we manage liquidity, reducing institutional funding. In addition, core deposits were seasonally lower, while it was impacted by the transfer of the financial agent business in the service. Average peso deposits were down nearly 9% quarter-on-quarter,…

Thank you, Mariano. [Operator Instructions] Our first question comes from [indiscernible], Atlantic Securities.

Hi, thank you for taking my question. I have a concise yet hard to answer question. So what would it take for Grupo Supervielle to turn around its operation? What's in your hands? And what depends on more favorable macro conditions? Thank you.

Do you want to take, Mariano?

Yes. Hello, Rodrigo. Thank you for your question. Let me answer regarding for us to turn around our profit for next year. As Patricio discussed during the presentation, we have a profitability based on the first cost savings initiatives, which is part of what we have handled. And in fact, we have been deploying these initiatives during 2022, the main being the transfer of an integration of IUDU customers and operations with the bank, which allow us to have cost savings of ARS3.7 billion extending into 2022 currency. Then the transfer of the agreement with the Province of San Luis of efficiencies as we are reducing 18 branches that existed already relating to this financial agent agreements. We are maintaining the branches in San Luis that operate with the private sector customers, both companies and individuals in the main locations and main cities of the province. So we are keeping - maintaining the presence in the province in much more efficient way. And then also there are cost reductions which are already - have already been taking place at the bank level, also at invertironline with a bank decreasing the headcount in 10% over the last two years. So these initiatives are under our control and are being implemented and will allow us to have a very significant reduction in costs for next year. Then on the revenue side, we've been working in our digital transformation strategy, which has allowed us to increase our customer base by 100,000 individual customers this year. Most of these customers are being onboarded digitally. So that is also a source of efficiency. And we will also see for next year, a growth in our loan portfolio in line with its - inflation as opposed to this year, where we've seen growth below inflation. So those are the main initiatives that will allow us to increase profitability. And of course, then there are risks mainly related to the macroeconomic environment and the regulatory environment, which are not under our control. Those risks, that's the main one, I think, is the inflation, a more accelerated inflation than what we expect now is clearly punitive for our business and for our costs. And then the regulation, which has been also very punitive in this context, with the main regulation affecting our margins and results being related to interest rate caps and flows. So that will be the main drivers. In our path to profitability, the main drivers are the ones that we can control. It's not only because we expect a very macro environment.

That was really helpful. Thank you.

Okay. Thank you, Rodrigo. We have a question in the Q&A box from Alejandra Aranda, Itau. It's related to this one, but I think it has marked more color on IUDU. Hi, Patricio, I would like to have more color on the process of integration of IUDU. Could you tell us where we are, what's going to be carried on in the next quarters? And can you walk us through how we should think of efficiencies starting to show on the P&L to show positive return on equity on 2023? What are the other implicit premises behind this, meaning inflation, union agreement, headcount, loan and deposit growth, exposure to government paper rates, GDP, etc., that I'm sure was asked?

Let me add to what Mariano said, with the acceleration of inflation in 2022. We made a shift in strategy, a very really radical shift in strategy because we had two platforms, the digital platforms to capture clients. That was the idea. First, the platform, of course, of the main engine, Banco Supervielle, but the idea also was to have a platform at IUDU independent to attend the consumer finance operations. And we decided to have only one platform. So this we will operate with only one platform, and this is much more efficient. With the macro outlook, which continues to have high inflation, although these consumer segments that we transferred to Banco Supervielle, we hope to basically to provide them with a much wider array of some financial services that they had originally at IUDU, and hopefully to through cross-selling get better results with an integration with - and commercial synergies with these clients. Notwithstanding with high inflation and such high inflation, we decided also that origination standards at the bank are much stricter, because inflation is not going down. In fact, it's going up. So basically, we have much stricter origination standards at this point with the consumer finance sector. So we're reflecting a very low appetite to take risk at this time. I don't know if you want to add something.

Not very much, maybe related to what Alejandra was asking as to where we are or what part of the process of integration we are. We are actually moving quickly and moving the portfolio of loans and credit cards by batches. And we - I would say we are roughly around 100,000 clients that have already been transferred to the bank. And we expect to complete this process, if there are no delays by the middle of December, maybe a little bit earlier. So we're moving very well and as expected and on target in that process.

And also, I'd like to say that the contract with Dorinka is being continued by Banco Supervielle. That's another important part that I want to stress.

Okay. I have one more from Alejandra Aranda as well. Thinking ahead, how do you imagine the Argentina system and consolidation taking place given the situation that some players are facing?

Well, I think that basically, we are in a - I think historically, the ratio of loans to the GDP has been in the lowest, at least in the last 20 years. So when there is - according to past history, when there was a change in expectation. There was a very rapid or drastic change in the behavior of business actions and business community. So this rapid and radical change will mean that there will be - will hopefully, with the change of - with the new government that are starts to deregulate and tackle inflation, it will mean that there will be much more demand and normalization - much more demand of loans and the monetization of the banking business. And this will be very positive for us. We are well prepared - we've been preparing for that in the - with our digital transformation, with our driving further operating efficiencies with the consolidation of branches that we mentioned and the efficiencies we captured in personnel. So we have a solid - we believe we have sufficient capital to attend growth in demand of loans, so I think that the consolidation - looking forward, there will be a consolidation, but this consolidation first will be in terms of growing of this demand of loans by individuals and corporations. So it would be what I would say, an organic consolidation. So we are very well placed to play in this consolidation.

Okay. Well, we'll wait for - when we point for new questions just a second. Okay. Ladies and gentlemen, we have reached the end of today's Q&A session. Thank you for joining us today. We appreciate your interest in our company. We look forward to meeting more of you over the coming months and providing financial and business updates next quarter. In the interim, we remain available to answer any questions that you may have. Have a good day.