Grupo Supervielle Reports 2Q23 Results

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 and six-months period ended June 30, 2023.

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.

In 3Q22 IUDU adopted IFRS 9 for the fiscal year beginning on January 1, 2022, and the IFRS 9 transition date was scheduled for January 1, 2021. For comparative purposes, and according to IAS 8, changes in accounting policies were applied retrospectively, therefore reported figures and applicable ratios have been restated.

Management Commentary

Commenting on second quarter 2023 results, Patricio Supervielle, Grupo Supervielle’s Chairman & CEO, noted: “We delivered positive ROAE improving to 17.6% in real terms as we continue executing on our strategic plan and progressing on our path to profitability while at the same time navigating a complex macroeconomic and political environment. ROAE also benefited from a lower turnover tax burden starting this quarter.

NIM reached 26.6% driven mainly by a 20.4% sequential increase in net financial income primarily due to a combination of higher volumes and spreads. This high NIM continued into July driven by our strong asset and liability management capabilities. We increased the spread of short-term central bank securities portfolio leveraging the 16% expansion of our peso deposit base. This sequential growth in deposits was aided by public sector deposits, corporates, and the positive impact from the thirteenth salary. This more than offset a contraction in the loan book as we maintained a prudent approach to lending prioritizing high value customers.

Reflecting our focus on asset quality, the NPL ratio declined to a low of 2.5% this quarter. We maintained stringent credit scoring criteria focusing on loans to payroll, entrepreneurs and middle-market customers with early delinquency improving month over month.

Overall, we reported a solid first half of the year, with ROE in real terms at 9.9%. During 1H23 and compared with the same period a year ago, Net financial income increased 9%, loan loss provisions declined 37% reflecting a healthier loan mix, while personnel and administrative expenses declined 8% as we made significant progress in streamlining our branch network and capturing significant efficiencies while further enhancing the customer experience. Lower costs together with strong revenues resulted in an improvement in the efficiency ratio to 67% from 78% in 1H22.