3Q20 Net Income of AR$859.6 million; Comprehensive Net Income of AR$760.7 million

Grupo Supervielle S.A. (NYSE: SUPV) ; (BYMA: SUPV), (“Supervielle” or the “Company”) a universal financial services group headquartered in Argentina with a nationwide presence, today reported results for the three-month and nine-months periods ended September 30, 2020.

Starting 1Q20, the Company began reporting results applying Hyperinflation Accounting, in accordance with IFRS rule IAS 29 (“IAS 29”) as established by the Central Bank. For ease of comparison, figures for all quarters of 2019 have been restated applying IAS 29 to reflect the accumulated effect of the inflation adjustment for each period through September 30, 2020.

Management Commentary

Commenting on third quarter 2020 results, Patricio Supervielle, Grupo Supervielle's Chairman & CEO, noted: “We delivered double digit ROAE in real-terms and continued to strengthen coverage this quarter while increasing our capital base and maintaining strong liquidity. This was achieved in an environment that continues to be difficult with stay-in-place restrictions to contain the pandemic, a recessionary macro environment and a changing regulatory framework.

Given the current market situation, we are balancing the profitability-risk equation through managing the credit cycle and leveraging our flexibility, which resulted in lower loan and deposit growth.

As we retain a cautious approach to managing credit risk, we continued to revise our expected loss models to adjust to the current economic outlook. Following further in-depth top down analysis of certain industries that we expect could be highly impacted by the pandemic, this quarter we made an additional AR$1 billion in Covid-19 anticipatory provisions which resulted in a 12% sequential increase in provisions. We are closely monitoring our loan book and risk models to adjust as required. Importantly, we continued to increase our coverage ratio reaching over 181% this quarter, from 127% in 2Q20 and 83% in 4Q19.

We are seeing sustained adoption of digitalization across our business in this low touch economy. I would like to highlight that our senior citizen customer base continues to make significant strides in terms of digital adoption resulting in an overall higher number of transactions through digital and automatic channels. SMEs also continued to rapidly embrace the digital adoption since July with e-checks nearly doubling while e-factoring increased by 60% during the same period. Transactions at non-automated tellers stayed relatively unchanged at 7% and significantly below the 17% of total transactions observed in 1Q20.