Inter & Co, Inc. (NASDAQ:INTR) Q3 2023 Earnings Conference Call November 6, 2023 11:00 AM ET Company Participants João Vitor Menin - CEO Alexandre Riccio - SVP, Retail Banking Santiago Stel - SVP, Finance and Risks Conference Call Participants Flavio Yoshida - Bank of America Rafael Frade - Citi Neha Agarwala - HSBC Yuri Fernandes - JPMorgan Eduardo Rosman - BTG Pedro Leduc - Itau BBA Thiago Batista - UBS Operator Good afternoon, and thank you for standing by. Welcome to the Inter & Co's Third Quarter Earni ...

+1.5 mm QoQ Launching Releasing Operational & Innovative EARNINGS PRESENTATION | 2Q23 / Engagement BANKING & SPENDING CREDIT SHOP INSURANCE INVEST GLOBAL LOYALTY CEO Overview Banking Transactional Platform Financial Performance Closing Remarks Appendix 7 Business Model Cards + PIX TPV1 In R$ Billion 60 .0 62% 62% 61% 58% 55% 54% 54% 55% 54% 53% 38% 38% 39% 42% 45% 46% 46% 45% 46% 47% 8 9 12 14 14 16 17 19 18 20 37 58 80 94 97 118 138 158 163 177 44 67 92 109 111 134 155 178 181 197 0. 0 10. 0 20 .0 30 .0 40 ...

Inter & Co, Inc. (NASDAQ:INTR) Q2 2023 Results Conference Call August 14, 2023 2:00 PM ET Company Participants João Vitor Menin - CEO Alexandre Riccio - SVP, Retail Banking Santiago Stel - SVP, Finance and Risks Conference Call Participants Thiago Batista - UBS Yuri Fernandes - JPMorgan Eduardo Rosman - BTG Rafael Frade - Citi Pedro Leduc - Itaú BBA Neha Agarwala - HSBC Tito Labarta - Goldman Sachs Operator Good afternoon, and thank you for standing by. Welcome to the Inter & Co Second Quarter Earnings Conf ...

[Management Report](index=4&type=section&id=Management%20report) This section summarizes the company's operational, financial, and equity performance, alongside its independent auditor relationship [Operating Highlights](index=4&type=section&id=Operating%20highlights) As of June 30, 2023, the company surpassed 27.8 million customers with an activation rate of 52% The loan portfolio grew to R$25.1 billion, an 11% increase from December 2022, and total funding reached R$33.3 billion, up 11.6% from year-end 2022 - Surpassed **27.8 million customers** as of June 30, 2023, with the activation rate increasing by **68 bps** from the previous quarter to **52%**[6](index=6&type=chunk) Key Operating Metrics as of June 30, 2023 | Metric | Value (R$ billion) | Change vs. Dec 31, 2022 | | :--- | :--- | :--- | | Loan Portfolio | 25.1 | +11.0% | | Total Funding | 33.3 | +11.6% | [Economic and Financial Highlights](index=4&type=section&id=Economic%20and%20financial%20highlights) For the six months ended June 30, 2023, the company recorded a profit of R$88.4 million, a significant turnaround from a R$13.3 million loss in the same period of 2022 Revenues for the first half of 2023 reached R$3.61 billion, an increase of R$1.03 billion year-over-year, while administrative and personnel expenses rose by R$49.1 million to R$1.09 billion Financial Performance for the Six Months Ended June 30 | Metric | 2023 (R$ million) | 2022 (R$ million) | Change | | :--- | :--- | :--- | :--- | | Profit / (Loss) | 88.4 | (13.3) | Turnaround to profit | | Revenues | 3,606.5 | 2,574.8 | +R$1,031.7 million | | Admin & Personnel Expenses | 1,092.1 | 1,043.0 | +R$49.1 million | [Equity Highlights](index=4&type=section&id=Equity%20highlights) As of June 30, 2023, total assets grew to R$50.0 billion, a 7.9% increase from December 2022 Shareholders' equity also increased by 3.2% to R$7.3 billion over the same period Balance Sheet Highlights vs. Dec 31, 2022 | Metric | June 30, 2023 (R$ billion) | Change vs. Dec 31, 2022 | | :--- | :--- | :--- | | Total Assets | 50.0 | +7.9% | | Shareholder's Equity | 7.3 | +3.2% | [Relationship with the Independent Auditors](index=5&type=section&id=Relationship%20with%20the%20independent%20auditors) The company maintains a policy to ensure the independence of its independent auditor, KPMG Auditores Independentes Ltda The Audit Committee evaluates the effectiveness of the audits and confirms that non-audit services performed during the quarter did not compromise the auditor's independence and objectivity - The company has a policy and an Audit Committee to ensure the independence and objectivity of its independent auditor, **KPMG Auditores Independentes Ltda**[14](index=14&type=chunk) - The performance of non-audit services by KPMG during the quarter ended June 30, 2023, did not affect their independence[15](index=15&type=chunk) [Report of the Independent Auditors](index=6&type=section&id=Report%20of%20the%20independent%20auditors%20on%20the%20condensed%20consolidated%20interim%20financial%20statements) This section presents the independent auditors' conclusion on the condensed consolidated interim financial statements and the supplementary statement of value added [Conclusion on the Consolidated Interim Financial Information](index=6&type=section&id=Conclusion%20on%20the%20consolidated%20interim%20financial%20information) KPMG Auditores Independentes Ltda. conducted a review of Inter & Co's condensed consolidated interim financial information for the period ended June 30, 2023 Based on their review, nothing came to their attention that would suggest the financial information was not prepared, in all material respects, in accordance with IAS 34 - The review was conducted in accordance with Brazilian and international review standards (**NBC TR 2410** and **ISRE 2410**)[22](index=22&type=chunk) - The auditors concluded that they are not aware of any material modifications that should be made to the condensed consolidated interim financial information for it to be in conformity with **IAS 34**[23](index=23&type=chunk) [Statement of Value Added](index=7&type=section&id=Statement%20of%20value%20added) The auditors also reviewed the supplementary consolidated statements of value added for the six-month period ended June 30, 2023 They concluded that this statement was prepared, in all material respects, according to the criteria of Technical Pronouncement CPC 09 and is consistent with the overall interim financial information - The consolidated statements of value added are presented as supplementary information for **IAS 34** purposes[25](index=25&type=chunk) - The auditors found no reason to believe the statement of value added was not prepared in accordance with **CPC 09** and consistent with the primary financial statements[25](index=25&type=chunk) [Consolidated Financial Statements](index=8&type=section&id=Consolidated%20financial%20statements) This section presents the company's consolidated balance sheets, income statements, comprehensive income, cash flows, changes in equity, and statements of added value [Consolidated Balance Sheets](index=8&type=section&id=Consolidated%20balance%20sheets) As of June 30, 2023, Inter & Co's total assets stood at R$50.0 billion, an increase from R$46.3 billion at year-end 2022 This growth was driven by increases in cash and cash equivalents, securities, and loans to customers Total liabilities rose to R$42.7 billion from R$39.3 billion, primarily due to higher liabilities with customers and securities issued Total equity increased to R$7.3 billion Consolidated Balance Sheet Highlights (in thousands of BRL) | Account | 06/30/2023 | 12/31/2022 | | :--- | :--- | :--- | | **Total Assets** | **50,003,329** | **46,343,100** | | Cash and cash equivalents | 3,672,219 | 1,331,648 | | Securities | 14,169,684 | 12,448,565 | | Loans and advances to customers, net | 23,523,982 | 21,379,916 | | **Total Liabilities** | **42,685,671** | **39,253,996** | | Liabilities with customers | 26,299,326 | 23,642,804 | | Securities issued | 7,006,191 | 6,202,165 | | **Total Equity** | **7,317,658** | **7,089,104** | [Consolidated Statements of Income](index=9&type=section&id=Consolidated%20statements%20of%20income) For the six months ended June 30, 2023, the company reported a net profit of R$88.4 million, compared to a net loss of R$13.3 million in the prior-year period Net interest income grew to R$1.51 billion from R$1.10 billion Total revenues increased to R$2.17 billion, while impairment losses on financial assets also rose to R$749.2 million Consolidated Income Statement Highlights (Six Months Ended June 30, in thousands of BRL) | Account | 2023 | 2022 | | :--- | :--- | :--- | | Net interest income | 1,513,637 | 1,104,498 | | Revenues | 2,174,148 | 1,710,541 | | Impairment losses on financial assets | (749,241) | (555,410) | | **Profit / (loss) for the period** | **88,388** | **(13,297)** | | Basic earnings (loss) per share (BRL) | 0.1497 | (0.0318) | | Diluted earnings (loss) per share (BRL) | 0.1486 | (0.0318) | [Consolidated Statements of Comprehensive Income](index=10&type=section&id=Consolidated%20statements%20of%20comprehensive%20income) For the six months ended June 30, 2023, total comprehensive income was R$231.5 million, a significant improvement from a total comprehensive loss of R$749.6 million in the same period of 2022 The positive result was driven by the net profit for the period and a R$151.5 million positive change in the fair value of financial assets at FVOCI Consolidated Comprehensive Income (Six Months Ended June 30, in thousands of BRL) | Account | 2023 | 2022 | | :--- | :--- | :--- | | Profit (loss) for the period | 88,388 | (13,297) | | Financial assets at fair value through other comprehensive income | 151,492 | (111,911) | | **Total comprehensive income for the period** | **231,465** | **(749,597)** | [Consolidated Statements of Cash Flows](index=11&type=section&id=Consolidated%20statements%20of%20cash%20flows) For the six months ended June 30, 2023, net cash from operating activities was R$4.13 billion Net cash used in investing activities was R$1.80 billion, mainly due to the net acquisition of financial assets Financing activities used R$27.6 million This resulted in a net increase in cash and cash equivalents of R$2.30 billion, bringing the ending balance to R$3.67 billion Consolidated Cash Flow Summary (Six Months Ended June 30, in thousands of BRL) | Account | 2023 | 2022 | | :--- | :--- | :--- | | Net cash from operating activities | 4,127,654 | 2,597,174 | | Net cash used in investing activities | (1,800,550) | (392,534) | | Net cash from financing activities | (27,643) | (1,198,524) | | **(Decrease)/ Increase in cash and cash equivalents** | **2,299,461** | **1,006,116** | | Cash and cash equivalents at the beginning of the period | 1,331,648 | 500,446 | | **Cash and cash equivalents at end of period** | **3,672,219** | **1,549,158** | [Consolidated Statements of Changes in Equity](index=12&type=section&id=Consolidated%20statements%20of%20changes%20in%20equity) Total equity increased from R$7.09 billion at the start of 2023 to R$7.32 billion as of June 30, 2023 The increase was primarily driven by the R$88.4 million profit for the period and a R$151.5 million positive net change in the fair value of financial assets at FVOCI, partially offset by the repurchase of R$16.4 million in treasury shares Changes in Equity (Six Months Ended June 30, 2023, in thousands of BRL) | Description | Amount | | :--- | :--- | | Balance at January 1, 2023 | 7,089,104 | | Profit for the period | 88,388 | | Net change in fair value - financial assets at FVOCI | 151,492 | | Repurchase of treasury shares | (16,409) | | Other changes | 4,083 | | **Balance at June 30, 2023** | **7,317,658** | [Consolidated Statements of Added Value](index=13&type=section&id=Consolidated%20statements%20of%20added%20value) For the six months ended June 30, 2023, the total added value to distribute was R$610.5 million, up from R$368.6 million in the same period of 2022 The distribution was primarily allocated to personnel and taxes (R$313.5 million), taxes, contributions and fees (R$184.3 million), and retained earnings (R$60.2 million) Distribution of Added Value (Six Months Ended June 30, in thousands of BRL) | Category | 2023 | 2022 | | :--- | :--- | :--- | | **Total added value to distribute** | **610,546** | **368,610** | | Personnel and tax | 313,509 | 274,446 | | Taxes, contributions and fees | 184,275 | 86,216 | | Rent | 24,374 | 21,245 | | Profit (losses) retained | 60,151 | (13,318) | | Non-controlling interest | 28,237 | 21 | [Notes to the Condensed Consolidated Interim Financial Statements](index=14&type=section&id=Notes%20to%20the%20condensed%20consolidated%20interim%20financial%20statements) This section provides detailed notes on the company's activities, accounting policies, operating segments, financial risk management, fair values, specific asset and equity accounts, share-based payments, related party transactions, and subsequent events [Note 1. Activity and Structure](index=14&type=section&id=Note%201.%20Activity%20and%20structure%20of%20Inter%20%26%20Co,%20Inc.%20and%20its%20subsidiaries) Inter & Co, Inc. is a Cayman Islands holding company and the parent of the Inter Group Its shares trade on Nasdaq (INTR) and its BDRs on Brazil's B3 (INBR32) The Group provides a digital ecosystem of financial and e-commerce services to over 27.7 million customers in Brazil and the US A key corporate reorganization was completed in June 2022, making Inter & Co the indirect owner of all shares of Banco Inter S.A - Inter & Co, Inc. is a holding company for the Inter Group, providing integrated financial and e-commerce services[42](index=42&type=chunk)[44](index=44&type=chunk) - The company's shares trade on **Nasdaq (INTR)** and **B3 (INBR32)** following a corporate reorganization in June 2022[43](index=43&type=chunk)[44](index=44&type=chunk) - In January 2022, the company acquired **Inter&Co Payments, Inc. (formerly USEND)** to accelerate its global expansion, particularly in the US[45](index=45&type=chunk) [Note 4. Significant Accounting Policies](index=16&type=section&id=Note%204.%20Significant%20accounting%20policies) The accounting policies are consistent with those from the 2022 annual report The statements are prepared on a consolidated basis, including all subsidiaries where Inter has control A significant event was the acquisition of Inter US Finance, LLC and Inter US Management, LLC in January 2023, accounted for as a business combination, to expand real estate-focused credit operations in the US [Basis for Consolidation](index=16&type=section&id=4.a%20Basis%20for%20consolidation) The Group consolidates all entities it controls The primary restriction on transferring assets within the group relates to compulsory reserves required by the Central Bank of Brazil In February 2023, Banco Inter acquired the remaining shares of its subsidiary Inter DTVM, making it a wholly-owned subsidiary - Subsidiaries are fully consolidated from the date control is gained The main restriction on asset transfers is the regulatory compulsory reserves held at the **Central Bank of Brazil**[58](index=58&type=chunk) - On February 15, 2023, **Banco Inter S.A.** acquired the remaining shares of its subsidiary '**Inter Distribuidora de Títulos e Valores Mobiliários Ltda**', making it a **100% owned entity**[61](index=61&type=chunk) [Business Combination](index=17&type=section&id=4.b%20Business%20combination) On January 24, 2023, the company acquired 100% of Inter US Finance, LLC and Inter US Management, LLC to expand its real estate-focused credit offerings in the US The total consideration was R$3.3 million, resulting in a preliminary goodwill of R$3.0 million The purchase price allocation (PPA) study is still in progress - Acquired **100%** of **Inter US Finance, LLC** and **Inter US Management, LLC** on January 24, 2023, to expand real estate credit operations in **Florida, Georgia, and Colorado**[70](index=70&type=chunk)[71](index=71&type=chunk) Acquisition Consideration and Preliminary Goodwill (in thousands of BRL) | Company | Consideration Transferred | Preliminary Goodwill | | :--- | :--- | :--- | | Inter US Finance, LLC | 1,990 | 1,918 | | Inter US Management, LLC | 1,327 | 1,114 | - The purchase price allocation (**PPA**) study for the acquisition was not yet complete as of the report date[73](index=73&type=chunk) [Note 5. Operating Segments](index=19&type=section&id=Note%205.%20Operating%20segments) The Group's operations are divided into five segments: Banking & Spending, Investments, Insurance Brokerage, Inter Shop & Commerce Plus, and Others For the first half of 2023, the Banking & Spending segment generated the highest revenue (R$1.90 billion) and held the vast majority of assets (R$48.7 billion) The Insurance Brokerage and Inter Shop & Commerce Plus segments were the most profitable before tax, with profits of R$43.4 million and R$50.0 million, respectively - The Group is organized into five reportable segments: **Banking & Spending, Investments, Insurance Brokerage, Inter Shop & Commerce Plus, and Others**[77](index=77&type=chunk)[78](index=78&type=chunk)[79](index=79&type=chunk)[80](index=80&type=chunk)[81](index=81&type=chunk) Segment Performance for Six Months Ended June 30, 2023 (in thousands of BRL) | Segment | Revenues | Profit / (Loss) before Tax | Total Assets | | :--- | :--- | :--- | :--- | | Banking & Spending | 1,898,048 | (2,519) | 48,700,501 | | Investments | 76,178 | 6,565 | 605,303 | | Insurance Brokerage | 79,086 | 43,354 | 168,205 | | Inter Shop & Commerce Plus | 121,089 | 50,021 | 588,806 | | **Consolidated Total** | **2,174,148** | **86,196** | **50,003,329** | [Note 6. Financial Risk Management](index=23&type=section&id=Note%206.%20Financial%20risk%20management) The company actively manages credit, market, liquidity, and operational risks through independent structures and defined policies Credit risk is managed via careful evaluation of borrowers Liquidity risk is managed to ensure obligations can be met Market risk is monitored using models like Value at Risk (VaR), with the banking book showing a VaR of R$274.7 million and the trading book R$4.4 million as of June 30, 2023 [Credit Risk](index=23&type=section&id=6.a%20Credit%20risk) Credit risk arises from the potential failure of a borrower to meet financial obligations The Group manages this by evaluating the borrower's financial capacity and reputation The loan portfolio includes credit cards, business loans, real estate loans, personal loans, and agribusiness loans For real estate loans, the majority have a loan-to-value ratio between 31% and 70% - Credit risk is managed through careful evaluation of the borrower's economic capacity, payment history, and reputation before contracting[88](index=88&type=chunk) Real Estate Loans by Loan-to-Value (LTV) Ratio (in thousands of BRL) | LTV Ratio | 06/30/2023 | 12/31/2022 | | :--- | :--- | :--- | | Lower than 30% | 719,923 | 693,322 | | 31 - 50% | 1,766,391 | 1,689,190 | | 51 - 70% | 2,542,254 | 2,308,020 | | 71 - 90% | 1,933,436 | 1,503,703 | | Higher than 90% | 58,429 | 57,577 | | **Total** | **7,020,433** | **6,251,812** | [Liquidity Risk](index=24&type=section&id=6.c%20Liquidity%20risk) Liquidity risk is the possibility of not being able to meet financial obligations The company analyzes its financial instruments by contractual term As of June 30, 2023, financial liabilities maturing in up to 3 months totaled R$20.8 billion, primarily from liabilities with customers and financial institutions, while financial assets maturing in the same period were R$15.3 billion Financial Instruments by Remaining Contractual Term (Up to 3 months, as of 06/30/2023, in thousands of BRL) | Category | Amount | | :--- | :--- | | **Financial Assets** | **15,321,162** | | Cash and cash equivalents | 3,672,219 | | Loans and advances to customers | 6,767,656 | | **Financial Liabilities** | **20,813,801** | | Liabilities with financial and similar institutions | 8,023,953 | | Liabilities with customers | 12,428,677 | [Market Risk](index=26&type=section&id=6.e%20Market%20risk) Market risk is managed by classifying operations into a trading book and a banking book, with risk levels monitored using Value at Risk (VaR) As of June 30, 2023, the 21-day VaR for the trading book was R$4.4 million, and for the much larger banking book, it was R$274.7 million, a decrease from R$337.3 million at year-end 2022 Sensitivity analysis shows potential losses under various interest rate shock scenarios Value-at-Risk (VaR) 21 days (in thousands of BRL) | Book | 06/30/2023 | 12/31/2022 | | :--- | :--- | :--- | | Trading Book | 4,417 | 4,751 | | Banking Book | 274,722 | 337,254 | - Sensitivity analysis under a scenario of a **50% shock** in coupon rates indicates potential losses of **R$843.7 million** for **IPCA coupon risk** and **R$676.4 million** for pre-fixed rate risk[105](index=105&type=chunk) [Note 7. Fair Values of Financial Instruments](index=28&type=section&id=Note%207.%20Fair%20values%20of%20financial%20instruments) The Group classifies its financial instruments measured at fair value into a three-level hierarchy As of June 30, 2023, of the R$13.06 billion in financial assets measured at fair value, R$10.96 billion were classified as Level 1 (quoted prices in active markets), R$2.01 billion as Level 2 (observable inputs), and R$93.2 million as Level 3 (unobservable inputs) The Level 3 assets relate to contingent consideration from the sale of Inter Seguros Fair Value Hierarchy of Financial Assets (as of 06/30/2023, in thousands of BRL) | Level | Fair Value | | :--- | :--- | | Level 1 | 10,955,333 | | Level 2 | 2,014,557 | | Level 3 | 93,199 | | **Total** | **13,063,089** | - Level 3 financial assets consist substantially of the variable portion receivable from the 2019 sale of **40%** of the subsidiary **Inter Digital Corretora e Consultoria de Seguros Ltda. ('Inter Seguros')**[109](index=109&type=chunk) [Note 10. Securities](index=31&type=section&id=Note%2010.%20Securities) The Group's securities portfolio totaled R$14.17 billion as of June 30, 2023, up from R$12.45 billion at year-end 2022 The majority of securities, R$11.50 billion, are classified as Fair Value Through Other Comprehensive Income (FVOCI), consisting mainly of government treasury bills (LFT and NTN) Securities by Classification (as of 06/30/2023, in thousands of BRL) | Classification | Amount | | :--- | :--- | | Fair value through other comprehensive income (FVOCI) | 11,497,605 | | Fair value through profit or loss (FVTPL) | 1,472,285 | | Amortized cost | 1,199,794 | | **Total** | **14,169,684** | [Note 12. Loans and Advances to Customers](index=34&type=section&id=Note%2012.%20Loans%20and%20advances%20to%20customers) The total loan portfolio reached R$25.14 billion as of June 30, 2023, an increase from R$22.70 billion at year-end 2022 The portfolio is diversified, with credit cards (30.5%), real estate loans (27.8%), and personal loans (25.5%) being the largest components The provision for expected losses increased to R$1.62 billion from R$1.32 billion Loan Portfolio Breakdown (in thousands of BRL) | Loan Type | 06/30/2023 | % of Total | | :--- | :--- | :--- | | Credit card | 7,681,011 | 30.52% | | Real estate loans | 7,020,433 | 27.76% | | Personal loans | 6,500,480 | 25.45% | | Business loans | 3,215,316 | 13.12% | | Agribusiness loans | 724,143 | 3.15% | | **Total** | **25,141,383** | **100.00%** | | Provision for expected loss | (1,617,401) | - | - The loan portfolio shows low concentration, with the **100 largest debtors** accounting for **12.78%** of the total portfolio, down from **16.56%** at year-end 2022[131](index=131&type=chunk) Changes in Provision for Expected Losses (in thousands of BRL) | Stage | Balance at 12/31/2022 | Constitution/(Reversal) | Write-off | Balance at 06/30/2023 | | :--- | :--- | :--- | :--- | :--- | | Stage 1 | 485,614 | 172,637 | - | 489,235 | | Stage 2 | 282,392 | 410,573 | - | 344,562 | | Stage 3 | 550,406 | 196,609 | (480,830) | 783,604 | | **Total** | **1,318,412** | **779,819** | **(480,830)** | **1,617,401** | [Note 16. Intangible Assets](index=40&type=section&id=Note%2016.%20Intangible%20assets) Intangible assets totaled R$1.30 billion as of June 30, 2023, up from R$1.24 billion at year-end 2022 The main components are goodwill (R$635.6 million), intangible assets in progress (R$246.7 million), and development costs (R$215.4 million) The increase in goodwill is related to the acquisition of US entities Intangible Assets Breakdown (as of 06/30/2023, in thousands of BRL) | Asset Type | Carrying Amount | | :--- | :--- | | Goodwill | 635,625 | | Intangible assets in progress | 246,742 | | Development costs | 215,395 | | Right of use | 161,197 | | Others | 44,223 | | **Total** | **1,303,182** | - Goodwill increased by **R$2.8 million** during the period due to the business combination involving the acquisition of **Inter US Finance** and **Inter US Management**[148](index=148&type=chunk) [Note 25. Equity](index=45&type=section&id=Note%2025.%20Equity) As of June 30, 2023, Inter & Co's share capital consisted of 284.8 million Class A shares and 117.0 million Class B shares The company did not pay dividends during the period, but a subsidiary paid R$16.0 million in interest on equity to non-controlling interests Basic earnings per share for the first half of 2023 was R$0.1497 The company also repurchased 104,876 Class A shares, now held in treasury - At an April 2023 meeting, a stock split by a factor of **3** was approved, to be effective on a future date set by the Board[174](index=174&type=chunk)[175](index=175&type=chunk)[176](index=176&type=chunk) Earnings Per Share (Semester ended 06/30/2023) | Metric | Value (BRL) | | :--- | :--- | | Basic earnings per share | 0.1497 | | Diluted earnings per share | 0.1486 | - As of June 30, 2023, the company holds **R$16,409 thousand** in treasury shares, consisting of **104,876 Class A shares**[183](index=183&type=chunk) [Note 34. Share-Based Payment](index=51&type=section&id=Note%2034.%20Share-based%20payment) The company manages several share-based payment plans In January 2023, Banco Inter's plans were migrated to Inter & Co, and a repricing of 2022 options resulted in an incremental expense of R$16.0 million A new Omnibus Incentive Plan was created, under which 2.14 million Restricted Share Units (RSUs) were granted to executives and employees on June 1, 2023, with a four-year vesting period - In January 2023, share-based payment plans from **Banco Inter S.A.** were migrated to **Inter&Co, Inc** A repricing of 2022 options resulted in an additional incremental expense of **R$15,990 thousand**[201](index=201&type=chunk) - On June 1, 2023, **2,140,500 restricted share units (RSUs)** were granted under the new **Omnibus Incentive Plan** with a **4-year vesting schedule**[210](index=210&type=chunk) - Total share-based payment costs recognized in H1 2023 were **R$15,802 thousand** for the legacy plan, **R$16,765 thousand** for the Inter & Co Payments plan, and **R$2,430 thousand** for the new RSU plan[204](index=204&type=chunk)[207](index=207&type=chunk)[210](index=210&type=chunk) [Note 35. Transactions with Related Parties](index=55&type=section&id=Note%2035.%20Transactions%20with%20related%20parties) The Group engages in transactions with related parties, including its parent company, associates, key management personnel, and other related entities As of June 30, 2023, total assets with related parties amounted to R$1.44 billion, primarily in loans (R$579.4 million) and amounts due from financial institutions (R$755.7 million) The global compensation for management personnel approved for 2023 is R$99.8 million Assets with Related Parties (as of 06/30/2023, in thousands of BRL) | Asset Type | Amount | | :--- | :--- | | Loans and advances to customers | 579,427 | | Amounts due from financial institutions | 755,745 | | Securities | 109,374 | | **Total** | **1,444,546** | - The global compensation for key management personnel approved for 2023 is **R$99,791 thousand**[217](index=217&type=chunk) - In February 2023, **Stone** sold its entire interest in Inter and is no longer considered a related party[213](index=213&type=chunk) [Note 36. Subsequent Events](index=58&type=section&id=Note%2036.%20Subsequent%20events) On August 7, 2023, a capital increase of R$100 million was approved for the associate company, Granito Instituição de Pagamento S.A Inter will subscribe and pay in R$50 million of this amount, pending approval from the Central Bank of Brazil - On August 7, 2023, a **R$100 million** capital increase was approved for associate **Granito**, with Inter contributing **R$50 million** The transaction is subject to approval by the **Central Bank of Brazil**[219](index=219&type=chunk)

In 2008, we received from the Central Bank of Brazil authorization to operate as a Multiple Bank, which allowed us to perform all banking activities in Brazil. Thus, we began to operate as a full-service bank, offering financing, investments, and real estate lending, under the name Banco Intermedium S.A. ("Banco Intermedium"). In 2012, we launched our insurance brokerage activities, offering a broad set of insurance products to our customers. In 2013, we also created our investment brokerage Inter DTVM, reg ...

Management Report [Company Overview](index=4&type=section&id=Company%20Overview) Inter & Co, Inc. is a Cayman Islands holding company listed on Nasdaq (INTR), with its primary subsidiary being Banco Inter S.A., operating as a "Super App" offering an integrated ecosystem of financial and non-financial services - **Inter & Co, Inc.** is a holding company trading on Nasdaq under the ticker INTR, with its main subsidiary being Banco Inter S.A., which operates a global services platform[2](index=2&type=chunk) - The company operates a **'Super App' model**, integrating a wide range of financial (current accounts, loans, investments) and non-financial services (Inter Shop digital mall) into a single application[3](index=3&type=chunk)[4](index=4&type=chunk) - In January 2022, the company acquired **Inter & Co Payments, Inc. (formerly USEND)**, a US-based company specializing in foreign exchange and money transfers, to accelerate its global expansion and offer a Global Account solution[5](index=5&type=chunk) [Operating and Financial Highlights](index=4&type=section&id=Operating%20and%20Financial%20Highlights) In the first quarter of 2023, Inter & Co demonstrated strong growth, surpassing 26.3 million customers and achieving a profit of R$24.2 million, a significant turnaround from a loss in the same period of 2022 Key Operating Metrics - Q1 2023 | Metric | Value | Change vs. Dec 2022 | | :--- | :--- | :--- | | **Total Customers** | 26.3 million | 44.4% growth in the period | | **Loan Portfolio** | R$23.8 billion | +4.8% | | - Real Estate Secured Loan | R$6.6 billion | +4.8% | | - Credit Card Portfolio | R$7.3 billion | +6.4% | | **Total Funding** | R$30.6 billion | +2.7% | Key Financial & Equity Highlights - Q1 2023 | Metric | Q1 2023 | Change | | :--- | :--- | :--- | | **Profit/(Loss)** | R$24.2 million | vs. R$28.8 million loss in Q1 2022 | | **Revenues** | R$2,937.0 million | +R$1,749.2 million vs. Q1 2022 | | **Admin & Personnel Expenses** | R$558.0 million | +R$36.1 million vs. Q1 2022 | | **Total Assets** | R$47.7 billion | +2.9% vs. Dec 2022 | | **Shareholder's Equity** | R$7.1 billion | +0.7% vs. Dec 2022 | [Relationship with the Independent Auditors](index=5&type=section&id=Relationship%20with%20the%20independent%20auditors) The company confirms that it has not contracted any non-audit services from its independent auditor, KPMG Auditores Independentes Ltda., and maintains policies to ensure auditor independence - The company states that no services other than the auditing of its financial statements have been contracted from its independent auditors, in compliance with **CVM Instruction nº 162/22**[14](index=14&type=chunk) - The company has policies and an **Audit Committee** in place to evaluate the effectiveness and independence of the auditors, ensuring that any non-audit services do not affect their objectivity[14](index=14&type=chunk)[15](index=15&type=chunk) Report of the Independent Auditors [Auditor's Conclusion](index=6&type=section&id=Auditor%27s%20Conclusion) KPMG Auditores Independentes Ltda. reviewed the condensed consolidated interim financial information for Q1 2023, concluding that it was prepared in all material respects in accordance with IAS 34 - The auditor's review was conducted on the condensed consolidated interim financial information for the quarter ended **March 31, 2023**[20](index=20&type=chunk) - A review is substantially less in scope than a full audit, and therefore, the auditors do not express an **audit opinion**[22](index=22&type=chunk) - Based on the review, KPMG found no evidence to believe the financial information is not prepared in all material respects according to **IAS 34**[23](index=23&type=chunk) - The supplementary consolidated statement of value added was also reviewed and found to be prepared in accordance with relevant criteria and consistent with the overall financial information[25](index=25&type=chunk) Consolidated Financial Statements [Consolidated Balance Sheets](index=8&type=section&id=Consolidated%20balance%20sheets) As of March 31, 2023, Inter & Co's total assets reached R$47.70 billion, a 2.9% increase from year-end 2022, with total liabilities and equity also seeing increases Consolidated Balance Sheet Highlights (in thousands of BRL) | Account | 03/31/2023 (in thousands of BRL) | 12/31/2022 (in thousands of BRL) | | :--- | :--- | :--- | | **Total Assets** | **47,701,094** | **46,343,100** | | Loans and advances to customers, net | 22,371,167 | 21,379,916 | | Securities | 12,535,351 | 12,448,565 | | **Total Liabilities** | **40,561,188** | **39,253,996** | | Liabilities with customers | 24,182,006 | 23,642,804 | | Liabilities with financial institutions | 8,216,538 | 7,906,897 | | **Total Equity** | **7,139,906** | **7,089,104** | [Consolidated Income Statements](index=9&type=section&id=Consolidated%20statements%20of%20income) For Q1 2023, the company reported a net profit of R$24.2 million, a significant improvement from a loss in Q1 2022, driven by increased net interest income and service revenues Consolidated Income Statement Highlights (in thousands of BRL) | Account | Q1 2023 (in thousands of BRL) | Q1 2022 (in thousands of BRL) | | :--- | :--- | :--- | | Net interest income | 711,080 | 532,402 | | Net result from services and commissions | 246,675 | 177,703 | | **Net revenues** | **1,024,114** | **833,521** | | Impairment losses on financial assets | (350,681) | (312,946) | | **Profit / (loss) for the period** | **24,216** | **(28,822)** | | Basic earnings (loss) per share (BRL) | 0.0284 | (0.0112) | [Consolidated Statements of Comprehensive Income](index=10&type=section&id=Consolidated%20statements%20of%20comprehensive%20income) The company's total comprehensive income for Q1 2023 was R$41.4 million, comprising net profit and positive other comprehensive income from financial asset fair value changes Consolidated Comprehensive Income (in thousands of BRL) | Account | Q1 2023 (in thousands of BRL) | Q1 2022 (in thousands of BRL) | | :--- | :--- | :--- | | Profit (loss) for the quarters | 24,216 | (28,822) | | Other comprehensive income | 17,191 | (52,029) | | **Total comprehensive income for the quarters** | **41,407** | **(80,851)** | [Consolidated Statements of Cash Flows](index=11&type=section&id=Consolidated%20statements%20of%20cash%20flows) In Q1 2023, net cash generated from operating activities was R$721.9 million, leading to a net increase in cash and cash equivalents of R$460.2 million for the period Consolidated Cash Flow Highlights (in thousands of BRL) | Activity | Q1 2023 (in thousands of BRL) | Q1 2022 (in thousands of BRL) | | :--- | :--- | :--- | | Net cash from operating activities | 721,900 | 927,110 | | Net cash used in investing activities | (244,732) | (202,448) | | Net cash from financing activities | (16,978) | (54,123) | | **(Decrease)/ Increase in cash and cash equivalents** | **460,190** | **670,539** | | Cash and cash equivalents at the beginning of the period | 1,331,648 | 500,446 | | **Cash and cash equivalents at March 31** | **1,791,707** | **1,171,654** | [Consolidated Statements of Changes in Equity](index=12&type=section&id=Consolidated%20statements%20of%20changes%20in%20equity) Total equity increased from R$7.09 billion to R$7.14 billion in Q1 2023, primarily due to net profit and positive changes in other comprehensive income, partially offset by share repurchases Changes in Total Equity - Q1 2023 (in thousands of BRL) | Item | Amount (in thousands of BRL) | | :--- | :--- | | **Balance at January 1, 2023** | **7,089,104** | | Profit for the period | 24,216 | | Net change in fair value - financial assets at FVOCI | 17,721 | | Repurchase of treasury shares | (16,409) | | Other changes | (526) | | **Balance at March 31, 2023** | **7,139,906** | [Consolidated Statements of Added Value](index=13&type=section&id=Consolidated%20statements%20of%20added%20value) The total added value to be distributed for Q1 2023 was R$259.9 million, primarily allocated to personnel, taxes, and retained profit Distribution of Added Value (in thousands of BRL) | Item | Q1 2023 (in thousands of BRL) | Q1 2022 (in thousands of BRL) | | :--- | :--- | :--- | | **Total added value to distribute** | **259,905** | **201,286** | | Personnel and tax | 149,418 | 124,540 | | Taxes, contributions and fees | 74,143 | 95,167 | | Rent | 11,857 | 10,401 | | Profit (losses) retained | 11,405 | 3,272 | | Non-controlling interest | 12,811 | (32,094) | Notes to the Financial Statements [Note 4. Significant Accounting Policies](index=16&type=section&id=Note%204.%20Significant%20accounting%20policies) This note details the Group's accounting policies, including the Q1 2023 acquisition of YellowFi entities to expand US real estate credit operations, following the 2022 acquisition of Inter & Co Payments for internationalization [Business Combination](index=17&type=section&id=Note%204.b.%20Business%20combination) On January 24, 2023, the Group acquired YellowFi Mortgage LLC and YellowFi Management LLC for R$3.3 million, generating R$3.0 million in preliminary goodwill, to expand US real estate credit services - On **January 24, 2023**, the Group acquired **100% of YellowFi Mortgage LLC and YellowFi Management LLC**, US-based companies providing real estate-focused credit, to expand its financial services offerings in the US[68](index=68&type=chunk)[69](index=69&type=chunk) YellowFi Acquisition Details (in thousands of BRL) | Item | YellowFi Mortgage, LLC (in thousands of BRL) | YellowFi Management, LLC (in thousands of BRL) | | :--- | :--- | :--- | | **Total consideration transferred** | **1,990** | **1,327** | | Total net identifiable assets | 72 | 212 | | **Goodwill on acquisition (preliminary)** | **1,918** | **1,114** | - The note reiterates details of the **January 14, 2022 acquisition of Inter & Co Payments, Inc. (USEND)** for a total consideration of **R$721.2 million**, which resulted in goodwill of **R$554.8 million** as part of the company's internationalization strategy[73](index=73&type=chunk)[74](index=74&type=chunk)[75](index=75&type=chunk) [Note 5. Operating Segments](index=20&type=section&id=Note%205.%20Operating%20segments) The Group's operations are divided into four reportable segments, with 'Banking & Spending' being the largest by assets but reporting a pre-tax loss, while 'Inter Shop & Commerce Plus' was the most profitable in Q1 2023 - The Group's four reportable segments are: **Banking & Spending, Investments, Insurance Brokerage, and Inter Shop & Commerce Plus**[81](index=81&type=chunk) Segment Performance - Q1 2023 (in thousands of BRL) | Segment | Revenues (in thousands of BRL) | Profit (loss) before taxes (in thousands of BRL) | Total Assets (in thousands of BRL) | | :--- | :--- | :--- | :--- | | **Banking & Spending** | 924,916 | (25,661) | 47,963,471 | | **Investments** | 33,551 | 15,299 | 641,651 | | **Insurance Brokerage** | 40,562 | 23,914 | 145,386 | | **Inter Shop & Commerce Plus** | 90,845 | 63,814 | 507,602 | [Note 6. Financial Risk Management](index=23&type=section&id=Note%206.%20Financial%20risk%20management) The Group manages credit, liquidity, market, and operational risks through independent structures, with real estate loans primarily having a Loan-to-Value (LTV) ratio between 31-70% and market risk monitored via Value at Risk (VaR) - The majority of the real estate loan portfolio has a **Loan-to-Value (LTV) ratio between 31% and 70%**[96](index=96&type=chunk) Value-at-Risk (VaR) - 21 days, 99% CL (in thousands of BRL) | Portfolio | VaR at 03/31/2023 (in thousands of BRL) | VaR at 12/31/2022 (in thousands of BRL) | | :--- | :--- | :--- | | **Trading Book** | 1,694 | 4,751 | | **Banking Book** | 262,565 | 337,254 | - A sensitivity analysis simulating a **50% adverse shock (Scenario III)** shows a potential loss of **R$799.9 million** from IPCA coupon exposure and **R$345.8 million** from TR coupon exposure[109](index=109&type=chunk)[110](index=110&type=chunk) [Note 12. Loans and Advances to Customers](index=35&type=section&id=Note%2012.%20Loans%20and%20advances%20to%20customers) The total loan portfolio grew to R$23.8 billion as of March 31, 2023, with credit cards, real estate, and personal loans as the largest components, and the provision for expected credit losses increasing to R$1.46 billion Loan Portfolio Breakdown (in thousands of BRL) | Loan Type | 03/31/2023 (in thousands of BRL) | % of Total | 12/31/2022 (in thousands of BRL) | % of Total | | :--- | :--- | :--- | :--- | :--- | | Credit card | 7,273,032 | 30.52% | 6,870,565 | 30.27% | | Real estate loans | 6,616,802 | 27.76% | 6,251,813 | 27.54% | | Personal loans | 6,081,266 | 25.45% | 5,463,781 | 24.07% | | Business loans | 3,110,840 | 13.12% | 3,392,500 | 14.95% | | Rural loans | 750,934 | 3.15% | 719,669 | 3.17% | | **Total Gross Loans** | **23,832,874** | **100.00%** | **22,698,328** | **100.00%** | | Provision for expected loss | (1,461,707) | | (1,318,412) | | - The concentration risk is moderate, with the **100 largest debtors** accounting for **23.08%** of the total loan portfolio, up from **16.56%** at the end of 2022[138](index=138&type=chunk) - Analysis of expected credit losses shows an increase in provisions across all three stages, with the total provision rising from **R$1.32 billion to R$1.46 billion** during the quarter[140](index=140&type=chunk) [Note 33. Share-Based Payment](index=51&type=section&id=Note%2033.%20Share-based%20payment) Following a corporate reorganization, share-based payment plans were migrated to Inter&Co, Inc., resulting in an incremental expense of R$16.0 million from repriced 2022 grants, with total Q1 2023 compensation costs of R$16.3 million - Following a corporate reorganization, share-based payment plans were migrated from **Banco Inter S.A. to Inter&Co, Inc.**, with options adjusted proportionally (**6 Banco Inter options to 1 Inter&Co share**)[190](index=190&type=chunk) - The exercise price for options granted in 2022 was repriced, resulting in an additional incremental expense of **R$15,990 thousand** to be appropriated over the final vesting period[190](index=190&type=chunk) - In Q1 2023, **R$9,912 thousand** in costs were recognized for the main stock option plans, and **R$6,355 thousand** were recognized for plans related to the Inter & Co Payments, Inc. acquisition[193](index=193&type=chunk)[196](index=196&type=chunk) [Note 34. Transactions with Related Parties](index=53&type=section&id=Note%2034.%20Transactions%20with%20related%20parties) The company engages in various transactions with related parties, with significant balances in loans and amounts due from financial institutions, and Stone Pagamentos S.A. is no longer considered a related party after selling its interest in February 2023 Key Related Party Balances (Assets) at 03/31/2023 (in thousands of BRL) | Category | Parent Company (in thousands of BRL) | Associates (in thousands of BRL) | Key Management (in thousands of BRL) | Other Related Parties (in thousands of BRL) | Total (in thousands of BRL) | | :--- | :--- | :--- | :--- | :--- | :--- | | Loans and advances to customers | 4,497 | 6,509 | 15,938 | 496,432 | 523,376 | | Amounts due from financial institutions | 10,399 | 660,587 | - | 358 | 671,344 | | Securities | 18,074 | - | 17,328 | 78,618 | 114,020 | - **Stone Pagamentos S.A.**, which owned **4.20%** of Inter's capital as of December 2022, sold **100%** of its interest in February 2023 and is no longer classified as a related party[202](index=202&type=chunk) [Note 35. Subsequent Events](index=56&type=section&id=Note%2035%20Subsequent%20events) After Q1 2023, Inter & Co executed a partial spin-off of Inter Marketplace, approved a 3-for-1 stock split, and renamed several US-based subsidiaries - On **April 1, 2023**, Banco Inter S.A. executed a partial spin-off of its investment in Inter Marketplace Ltda. into a new company, **Inter Conectividade Ltda.**[208](index=208&type=chunk) - On **April 28, 2023**, the company approved a change to its authorized capital and a **3-for-1 stock split** of all authorized or issued shares, which will become effective on a future date to be set by the Board of Directors[209](index=209&type=chunk)[210](index=210&type=chunk)[211](index=211&type=chunk) - Several subsidiaries were renamed, including **YellowFi Mortgage, Inc. to Inter US Finance, LLC** and **YellowFi Management, Inc. to Inter US Management, LLC**[212](index=212&type=chunk)

Financial Performance - The Gross Loan Portfolio increased to R$ 24,543,993 in 2022, up from R$ 17,514,466 in 2021, representing a growth of approximately 40.3%[26] - The company utilizes non-GAAP financial measures, such as Gross Loan Portfolio, to analyze financial performance and operational efficiency[24] Client Engagement - Active clients are defined as those generating revenue in the past three months, reflecting the company's ability to retain client interest[29] - The primary banking relationship metric indicates the percentage of clients with 50% or more of their income flowing into their accounts, reflecting the attractiveness of banking products[31] - The Net Promoter Score (NPS) is used to gauge client satisfaction and the effectiveness of client-focused initiatives[23] Market Expansion - The company aims to expand its operations into markets outside Brazil, particularly through the acquisition of USEND (now Inter&Co Payments) in the United States[34] Risk Management - The company has implemented a comprehensive financial risk management framework covering credit, market, liquidity, and operational risks[689] - Liquidity risk management aims to prevent breaches of liquidity ratios, ensuring the company can meet obligations without significant losses[692] - Market risk includes potential losses from changes in stock prices, interest rates, exchange rates, and commodity prices[693] - Operational risk management processes are in place to minimize losses from internal failures or external events[694] - Credit risk management focuses on safeguarding financial solidity and ensuring alignment with shareholders' interests[691] - Concentration risk is identified as a significant exposure to a borrower or counterparty, which could lead to credit losses[695] - The company conducts stress tests to assess exposure to various market risk factors[695] - Sensitivity analysis indicates that under Scenario I, the largest loss from fixed interest rates could be R$470 million if rates decrease[697] - Under Scenario I, the impact of an increase in the IPCA coupon could result in a loss of R$3.085 billion[697] Transaction Metrics - Card + PIX Total Payment Volume (TPV) includes transactions from PIX, debit, and credit cards, indicating the usage of digital payment products[29] - The take rate for transactions on the Inter Shop & Commerce Plus platform is monitored to assess monetization capabilities[29] Competitive Landscape - The company faces risks related to economic conditions, competition, and regulatory changes that could impact growth prospects[34]

Exhibit 99.1 Condensed consolidated interim financial statements as of September 30, 2022 Inter & Co, Inc. Inter & Co, Inc. Contents | Management report | 3 | | --- | --- | | Report on review of interim financial information | 7 | | Balance sheets | 9 | | Statements of income | 10 | | Statements of comprehensive income | 11 | | Statements of cash flows | 12 | | Statements of changes in equity | 13 | | Statements of added value | 14 | | Notes to the condensed consolidated interim financial statements | 15 | ...

inter Staying away from the comfort zone Quarterly Earnings Presentation August 2022 Inter's Latest Milestone Inter&Co Nasdaq Listing First ever conversion from Brazil to US Inter&Co now part of the Nasdaq family Another milestone on our history of re-defying boundaries 2 Quarterly performance highlights 20.7 mm Clients +73% YoY growth R$1.5 bn Revenues1 +130% YoY growth R$19.5 bn Gross Loan Portfolio +56% YoY growth +46% YoY growth 2Q22 R$25.9 bn Funding R$32 Monthly ARPAC +16% YoY growth R$14 Monthly CTSA ...

Financial Performance - The total revenue for the six-month period ended June 30, 2022, reached R$2,574.8 million, an increase of R$1,450.0 million compared to the same period in 2021, with a notable profit on securities growing by 287.7% to R$754.9 million[17]. - The company recorded a negative net income of R$13.3 million for the six-month period, an improvement from a negative net income of R$33.2 million in the same period of 2021[15]. - The company achieved revenues of R$2,638,601 for the six-month period ended June 30, 2022, compared to R$1,226,356 for the same period in 2021, reflecting a growth of approximately 115.5%[73]. - Banco Inter S.A. incurred a net loss of R$334,777 for the six-month period ended June 30, 2022, compared to a loss of R$212,195 in the same period of 2021, indicating a deterioration in performance[73]. Assets and Liabilities - Total assets reached R$40.9 billion, representing an 11.7% growth compared to December 2021[19]. - Total liabilities rose to BRL 33,818,398 as of June 30, 2022, compared to BRL 28,176,554 at the end of 2021, marking a 20% increase[33]. - Cash and cash equivalents increased to BRL 1,549,158 as of June 30, 2022, compared to BRL 500,446 at the end of 2021, reflecting improved liquidity[33]. - The loan portfolio balance reached R$19.5 billion, reflecting a positive change of 13.4% since December 31, 2021, with the real estate secured loan portfolio exceeding R$5.4 billion, a growth of 9.8%[13]. Shareholder Equity - Shareholders' equity totaled R$7.1 billion, showing a reduction of 18.4% compared to December 31, 2021[20]. - The company’s equity attributable to controlling shareholders increased to BRL 7,034,059, up from BRL 2,656,125, showing significant growth in shareholder value[33]. Expenses - Administrative and personnel expenses for the six-month period totaled R$1,161.3 million, an increase of R$724.7 million from the same period in 2021, attributed to the expansion of services and client base growth[18]. Corporate Actions - The company completed the acquisition of 100% of Pronto Money Transfer Inc. (USEND), enhancing its foreign exchange and financial services capabilities[11]. - The migration of shares from B3 to Nasdaq was approved by shareholders, indicating a strategic move to enhance market presence[6]. - Inter & Co, Inc. began trading on Nasdaq on June 23, 2022, following the completion of its corporate restructuring[51]. - The acquisition of Pronto Money Transfer Inc. (USEND) was completed for a total consideration of R$758,979, which includes R$631,901 in cash and R$37,644 in capital increase[76]. Financial Services Expansion - The acquisition of USEND allows Inter to expand its financial services in the U.S. market, integrating its solutions with the existing platform and targeting both U.S. residents and Brazilian customers[76]. - The company aims to operate as a multi-service digital bank, offering services such as real estate credit, payroll loans, corporate credit, and insurance[54]. Accounting and Financial Reporting - The company’s financial statements are prepared in accordance with IAS 34, with all amounts presented in thousands of Brazilian reais (BRL)[55]. - The new accounting standards effective from January 1, 2022, did not have a significant impact on the Group's financial statements[62]. - The Group recognizes revenue using a five-step model, with significant revenues derived from interchange fees and asset management activities[180]. Acquisitions and Goodwill - The fair value of identifiable assets acquired from USEND was R$236,087, with total liabilities of R$156,642, resulting in net identifiable assets of R$79,445 and goodwill of R$679,534[79]. - Goodwill from acquisitions represents the excess of transferred consideration over the fair value of identifiable net assets acquired, and is not amortized[151]. Risk Management - The expected credit loss is assessed using probability of default (PD), loss given default (LGD), and exposure at default (EAD) metrics[122]. - The Group recognizes expected credit losses on financial assets measured at amortized cost or fair value through other comprehensive income[119].