Grupo Supervielle S.A. (NYSE:SUPV) Q3 2020 Earnings Conference Call - Final Transcript

Nov 20, 2020 • 09:00 am ET


Grupo Supervielle S.A. (NYSE:SUPV) Q3 2020 Earnings Conference Call - Final Transcript


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Good morning and welcome to Grupo Supervielle's Third Quarter 2020 Earnings Conference Call. A slide presentation will accompany today's webcast, which is available in the Investors section of Grupo Supervielle's Investor Relations website, [Operator Instructions] As a reminder, today's call is being recorded.

At this time, I would like to turn the call over to Ms. Ana Bartesaghi, Treasurer and IRO. Please go ahead.

Ana Bartesaghi

Thank you. Good morning, everyone and thank you for joining us today. Speaking during today's call will be Patricio Supervielle, our Chairman and CEO and Mariano Biglia, our Chief Financial Officer. Also joining us are Alejandro Stengel, Second Vice Chairman of the Board and Bank's CEO and Jorge Ramirez, Third Vice Chairman of the Board. Alejandra Naughton, Board Member of several Grupo Supervielle's subsidiaries will also be joining us for today's call. All will be available for the Q&A session.

Note that starting first Q '20, as per Central Bank regulations, we began reporting results applying Hyperinflation Accounting in accordance with IFRS rule IAS 29. For ease of comparability, we have restated 2019 results to reflect the effects of inflation adjustment. Therefore all results in this presentation are adjusted for inflation as of September 30, 2020, unless otherwise noted.

For your convenience, our earnings report filed yesterday after market closed, also includes managerial results in nominal terms, as well as more details on Hyperinflation Accounting.

Before we proceed, I would like to make the following Safe Harbor statement. Today's call will contain forward-looking statements, which are based on management's current expectations and beliefs and are subject to a number of risks and uncertainties, including as a result of the COVID-19 pandemic and 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.

I would now like to turn the call over to our Chairman, Patricio Supervielle.

Julio Patricio Supervielle

Thank you, Ana. Good morning, everyone and thank you for joining us today. If you're following the presentation, please turn to Slide 3, starting with our financial performance. We delivered double-digit return on average equity in real terms this quarter despite the continued challenges presented by COVID-19 restrictions, a recessionary macro environment and a changing regulatory framework.

In this context, given our flexibility, we continue to balance the profitability risk equation, while managing the credit cycle, achieving satisfactory net financial margins. Despite lower loan and deposit growth, note that average peso deposits and assets increased sequentially. We have made additional COVID-19 anticipatory provisions this quarter that increase coverage following a further in-depth top-down analysis of certain industries that we believe could be highly impacted by the pandemic, given the current outlook. We also continue to review our expected loss models and are closely monitoring our loan book and risk models to adjust accordingly as the situation evolves. We kept our expenses below inflation, a result of strict cost controls achieving 90 basis points