Banco Macro S.A.(US:BMA)2025-05-29 16:02Financial Data and Key Metrics Changes - In Q1 2025, Banco Macro's net income totaled ARS 45.7 billion, a decrease of 59% or ARS 65.3 billion compared to Q4 2024 [4] - The annualized return on average equity was 3.81% and the return on average assets was 1.2% [5] - Net operating income before general and administrative expenses was ARS 82.6 billion lower than the previous quarter, a decrease of 9% [5] - Provision for loan losses increased by 60% or ARS 25.3 billion compared to Q4 2024 [6] - Net interest income totaled ARS 579.2 billion, ARS 1 billion higher than the previous quarter [6] Business Line Data and Key Metrics Changes - Interest income from loans and other financing increased by 9% or ARS 49.6 billion compared to the previous quarter [8] - Income from government and private securities decreased by 21% or ARS 71.5 billion quarter on quarter [8] - Fee income totaled ARS 169.8 billion, a decrease of 1% compared to the previous quarter [11] - Net income from financial assets and liabilities at fair value through profit or loss decreased by 55% or ARS 80 billion compared to Q4 2024 [12] Market Data and Key Metrics Changes - Banco Macro's market share over private sector loans reached 9.5% as of March 2025 [16] - Total deposits increased by 5% or ARS 485.4 billion quarter on quarter, totaling ARS 9.6 trillion [16] - Nonperforming total financial ratio reached 1.44% [17] Company Strategy and Development Direction - The bank aims to utilize its excess capital effectively, with a capital adequacy ratio of 34.3% and a Tier one ratio of 33.6% [18] - The focus is on organic growth, with potential for future M&A opportunities as the number of banks in Argentina may decrease [27] - The bank is adjusting its bond portfolio to reduce public sector exposure and increase loan growth [46] Management's Comments on Operating Environment and Future Outlook - The bank forecasts a real loan growth of 60% for 2025 and a real deposit growth of 45% [24] - Expected inflation for 2025 is around 30%, with a declining trend in domestic interest rates anticipated [36] - Operating expenses are expected to grow close to inflation, around 30% [37] Other Important Information - The effective income tax rate was 43% higher than the previous quarter [14] - The bank's liquidity remains strong, with a liquid assets to deposit ratio of 68% [18] Q&A Session Summary Question: Update on guidance for loan growth, deposits, and ROE - Management maintains a 60% loan growth forecast for 2025, with deposits expected to grow by 45% and ROE revised to 8% to 10% [24][25] Question: Drivers behind increased deposit growth - The increase in deposit growth is attributed to better-than-expected volume growth and stronger dollar deposit growth [28] Question: Macroeconomic expectations for interest rates, inflation, and GDP growth - Forecasts include 30% inflation for 2025, with a real GDP growth of 5% [36] Question: Loan to deposit ratio and capital ratio expectations - The loan to deposit ratio is expected to increase to around 90% by the end of 2025, with a strong capital ratio allowing for potential M&A opportunities [39][40] Question: Bond portfolio positioning and preferences - The bank prefers high exposure to inflation-linked bonds to hedge equity, aiming to maintain a stable level of available-for-sale bonds [46][48]