Foreign Trade Bank of Latin America Inc (BLX) 2009 Q2 法說會逐字稿

Welcome to the Bladex Conference Call. As a reminder, today's call is being recorded. At this time, I would like to turn the conference over to Melanie Carpenter. Ma'am, you may begin.

Thank you. Hello, everyone, and thank you for joining Bladex's second quarter 2009 earnings conference call on this the 23rd of July of 2009. This call is for investors and analysts only. If you are a member of the media, you're invited to listen-only. But if you have any questions, please follow up with i-advize after the call.

Joining us today from Panama City are Mr. Jaime Rivera, the CEO of Bladex and Mr. Jaime Celorio, the CFO of Bladex. Their comments will be based on the earnings release issued yesterday. A copy of the long version is available on the website at www.bladex.com.

Any comments that management makes today may include forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. They are based on information and data that is currently available. However, the actual performance may differ due to various factors that are cited in the Safe Harbor statement in the press release.

And with that, I'll turn it over to Mr. Jaime Rivera for his presentation. Please go ahead, Jaime.

Thank you, Melanie, and good morning, ladies and gentlemen. We appreciate your presence with us this morning and thank you for your time. We will follow the usual structure for our conference call. In my comments, I will address the results for the quarter from a big picture point of view, and then ask Mr. Jaime Celorio to take us through the figures in detail. And then, we will be happy to take your questions.

Nine months into this unprecedented financial crisis, to use a cliche, that is perhaps a bit too accurate for comfort, we keep managing the bank with a long-term interest of our shareholders in mind. You know as well we care deeply about our quarterly results, but our devotion is to the long-term prospects of the Company.

So today, and in spite of everything that has happened in the market, Bladex finds itself with ample liquidity, strong capitalization, low levels of operating expenses, historically high reserve coverages and a stream of diversified revenue supporting our operating profit levels.

As to the second quarter itself, we think, as was mentioned in the press release, that the quarter was one which was very well-balanced. There was good balance between the operating results of our different divisions and a good balance between liquidity and profit and risk considerations.

So let me delve for a second into some of the aspects of the results for the quarter within the context of the tactics that we have been using to weather the storm -- the financial storm very successfully.

As you might remember, we had been increasing reserves along with our estimates of increasing risk levels, even though we had not faced any credit issues in close to two years. Well, this quarter -- and that's a fact -- the impact of the crisis finally caught up with a handful of our loans, which were now in the process of restructuring. [So I'm saying] that if you have been with us for a while, you know that we know -- that we know how to do quite well.

And because we believe that risk levels are still rising, we increased reserve levels further still. Significantly, very significantly actually, we were able to do this while still generating over $10 million in profits. As a result, we believe that our whole approach to credit risk management has been effective.

As you might remember also, back in October we decided to collect significant portions of what we thought were the most vulnerable portions of our commercial portfolio, and at the same time, to increase liquidity levels. Even if this combination implies, as it did, diminishing the size of our balance sheet when the financial storm raged on.

Well, as you can see from the numbers, liquidity pressures have eased. The relative magnitude of the credit issues that we're facing is small. Lending spreads are still increasing and the size of our portfolio is stabilizing. So we believe that our approach to liquidity and to loan portfolio management has been right as well.

We had also stated our view that the quality of our securities portfolio was strong, though then we expected back then, that the underlying security prices were going to recover from the year-end and first-quarter lows. Well, as Jaime will explain in a few minutes, events had -- events have proven us right along these lines as well.

And finally, the asset management division, which we created to diminish our dependency on loan intermediation, has worked just as it was supposed to. Although credit demand has slackened, we have benefited from the new division's contribution to sustaining our bottom line.

So, all in all, while we don't expect things in the market to return to normal tomorrow or actually anytime soon, quite frankly we are not losing any sleep worrying about the near-term situation. The environment around us is volatile and the financial weather forecast so to speak is uncertain. But we're making steady progress by being prudent, patient, keeping our heads cool and being opportunistic about some great deals that we're finding.

More than ever, and perhaps more importantly than ever, we have been spending a lot of our time thinking about the long-term strategy of the bank. I think I had mentioned this last conference, but more and more, it is becoming evident as the crisis moves on that our competitive position is improving and that our opportunities are expanding. And let me share just a couple of very real examples along these lines for you.

Turns out that as the crisis has forced them to diversify, companies throughout Latin America are becoming increasingly regional, and in that process, they are finding themselves in need of trade finance services in more and more countries.

Well, it turns out that Bladex is just about the only bank with truly regional trade finance reach these days. Once trade flows start recovering, as they eventually will, this new reality will provide a significant -- significant boost to our business.

You might also have heard about some governments in the region wanting to extend credit support to their companies as they go overseas. Again, their shareholding in Bladex makes us, Bladex, an ideal platform through which to channel this business.

The bottom line and more than ever, we are spending time on positioning the Company for what we think would be significant upside once the markets return to some sort of stability, which they eventually will. Financial crises pass; they always pass.

And one last comment if I may. Within this process, we are privileged in being one of only a relative few -- among the relative few banks that have never needed, requested or received any specific support from anyone to face a crisis. And as a result, we have no conditionalities of any type hanging over our heads.

(inaudible) free to execute pretty much on any trade finance opportunities we decide are in the interest of shareholders. Being masters of our own destiny while having plenty of capital and liquidity at our disposal will in our estimation at least prove a significant competitive advantage going forward. It's actually a pretty exciting position to find ourselves in.

And so with this, ladies and gentlemen, I will let Jaime Celorio take us through the details for the quarter and before taking up your questions. Jaime, please.

Hello. Thank you, Jaime. Good morning, everyone. Thanks for your time in today's call. My description of the second quarter results will focus on fundamentals with regard to the profitability, solid capitalization, low leverage, adequate levels of reserves, stable asset quality, strong liquidity and an increase in the book value.

I will also be describing the second quarter results for the bank was able to deliver net operating income in each of the three business lines. And for the second quarter of 2009, net income was $10.5 million. The bank's traditional intermediation business through the Commercial Division performed well due to a continued increase in lending spreads, Jaime Rivera just mentioned, improving credit demand, especially during the month of June.

Also such results were compensated by the increasing reserve levels. There was a significant recovery in the securities portfolio at the Treasury Division and the asset management business had a positive quarter showing, again, the steady performance during the quarter and the first semester of 2009.

Now, let me talk in detail about the performance and results of each business segment as well as the bank's credit quality and financial performance.

Okay, let me start with the Commercial Division, where net operating income for the first quarter was $12.6 million. The balance was almost the same of the last quarter. And the main reasons here is due to lower average loan portfolio balances and such decrease was partially compensated by wider lending margins.

Note, however, that in June the portfolio grew for the first time since the crisis has started, at least when the crisis hit Latin America back in September of last year. The weighted average lending spreads on new loan disbursements continued to increase.

As of the end of the second quarter of 2009 represented 395 basis points versus 381 basis points, during the last quarter, and [183] bps versus a year ago. That means that the bank more than doubled its margins in one year due to a continued repricing of loans based on the short-term nature of the portfolio.

The commercial portfolio continues to be short-term and trade-related in nature. 70% of the commercial portfolio is considered short-term with maturities before one year. The breakdown of the portfolio as of December 2008 decreased to 64% at the corporate segment, while the banks increased to 32% and stay at the same level of 2%.

Trade finances stay at the same levels as of last quarter and they right now represent 62% while non-trade represents 37%.

Credit disbursements including during the second quarter of 2009, almost $2 billion from $831 million during the previous quarter. The commercial portfolio continues to be very well diversified and again not a single industry represents more than 14%.

As of the end of the second quarter, also the main exposures at the commercial portfolio continued to be in countries such as Brazil, Mexico, as well as Colombia.

Now let me take a minute in terms of discussing the quality of our loan portfolio and explain why the bank decided to increase its loan loss reserve coverage. This was a special quarter and that's why it's important for me to take a minute to discuss this.

The Bank continues to monitor risk very carefully, especially the ones for clients and sectors were affected by the global crisis and economic downturns in [divisions]. We have reasons to believe that some of the loans in the portfolio may be affected by the prolonged and widespread global financial crisis.

So, therefore, we're stretching the levels in the economy of each country in the region and came to the conclusion that the bank needed to establish a specific reserves equivalent to $12 million and therefore increase the ratio of allowance or trade losses of the commercial portfolio from the levels of 3.2% to 3.5%.

The specific loans are being renegotiated, something at which Bladex is very experienced, but something that always entitles some risk.

It's important here also to mention that the total nominal amount of loans that we believe to be restructured and for the ones we increase the reserves that I just mentioned are in the neighborhood of $25 million to $35 million which by the way, these ones are currently paying interest and we expect that they continue to do so.

Okay. That's all for the Commercial Division. Now, let me talk and switch over to the Treasury Division, where I will explain the effect of liquidity balances as well as the mark-to-market effect of the available for sale and trading securities.

The second quarter net operating income of $1 million includes mainly the combined net effect of $2 million gain from trading securities due to the appreciation of the underlying securities.

The bank continues to have strong liquidity balances and applies corporate policies and procedures to mitigate liquidity risk. There is an active management of intraday liquidity. And as of the end of the first quarter of 2009, the liquidity balance represents 456.

We will [lowly] continue these merging liquidity levels as the situation [and the] market improves. As of the end of the second quarter of 2009, the portfolio of securities available for sale totaled $608 million, representing an increase of $18 million from the first quarter of 2009, mainly due to our recovery in the mark-to-market of the securities available for sale.

Such mark-to-market increase was recorded in the other comprehensive income account as part of the total stockholders equity. The value of the trading securities increased $6 million during the quarter, mainly due to the mark-to-market effect which in this case is recognized in the P&L.

As of the end of first quarter of 2009, the securities consisted in high quality and liquid Latin American securities. We remind you that 84% of them are sovereign or/and state-owned risk in nature.

Finally, let me talk about the funding where our sources continue to be well diversified. And as a matter fact, deposit balances increased $44 million during the last quarter. And now they represent $1.3 billion. The asset management division had a strong quarter showing once again a steady performance.

The asset management division as I just mentioned continued to deliver solid results with net operating income during the second quarter of $2.6 million.

At this point, the division has been able to have positive results in nine out of the last 10 quarters. The net asset value of the fund as of the end of the second quarter of 2009 was $166 million and it represents an increase of $6 million in comparison with the $160 million we had in the last quarter.

Here it is also important to mention that all assets held by the fund are liquid. Their marks are -- has been level one and level two inputs, which are again the [one sustainable] market levels. The division has no (inaudible) based on level three inputs, which are the ones that are relying of the market estimates.

Now let me talk a minute about operating expenses. Operating expenses for the second quarter 2009 were $8.6 million. And here the main difference with the prior quarter was [close] to $2 million in decreasing salaries and further employee expenses. And again to lower expenses in the investment funds related to lower compensation expenses since there were lower trading gains in the asset management.

Before I turn back over to Mr. Jaime Rivera, I would like to provide some valuable data representing financial performance during this quarter. The book value for Commercial increased 7% during the quarter to levels of 17.61. Tier 1 capital ratio was 21% whereas the bank's equity consists entirely of Commercials. And ROE was 7% with a leverage of 6.3 times. Liquidity, as I mentioned before, continues to be strong. Asset quality is stable. Our reserves levels are adequate.

With that said, let me turn over to Jaime for his closing remarks, and please enjoy the rest of your day.

Thank you. Thank you, Jaime. Ladies and gentlemen, we will be glad to take up your questions. Please go ahead.

At this time, we will open the lines for questions. (Operator Instructions). Our first question comes from Tito Labarta with Deutsche Bank.

Yeah. Hi. Good morning, Jaime. First question in terms -- if you can give a little more color on in terms of the asset quality and provision levels like going forward, like what would be your expectations for how much asset quality could deteriorate and what kind of provision levels do you see for the coming quarters? Thanks.

Tito, how are you? We reach decisions on provision levels based on very technical analysis that incorporates our best estimates of what the future might hold. In other words, we currently have the provisions that we think we are going to lead given current market circumstances.

If market circumstances as we move forward match our expectations, the answer to your question is, we will need no more provisions. However, if there are unforeseen circumstances and the market turns out worse than we expected to turn out, conservative as we are being, we would need more provisions. But again, as we see the world today, and again our buyers, our estimation, the way we look at the world is that the storm still has a wild rage, what we have is sufficient.

I see. So you -- we won't continue to see the provision levels of like the $9 million and $5 million if things kind of stay where they are now?

That's correct. If things kind of stay where they are now, plus or minus 5%, this is all you will see. If events, if things turn out worse than expected, we'll have to adjust it. On the other hand, if we are -- we as a world turn out to be lucky and things start to turn out better than we think they are going to turn out, we will have to -- we'll have -- we'll end up with excess provisions and we will adjust them accordingly when the time comes.

Okay, great. Thanks. Very helpful.

Sure.

Our next question comes from Jeremy Hellman with Singular Research.

Hi. Good morning, everybody.

Jeremy, good morning.

First question, just talking about the commercial portfolio, and in your release, you noted that a lot of the disbursement were weighted towards into the June month. Can you kind of quantify how much of your disbursements in the quarter fell in June?

If it had not been for June, we would have shown a decrease in the end of a year balances. In the first couple of weeks -- in the last couple of weeks of June, the market seemed to be -- picked up actually throughout the region, and we got a lot of quality credit demand. This is a public conference.

So I will state that we noted for instance that in the first couple of weeks of July, we had already more than doubled our letter of credit commission income of the entire second quarter. It's very volatile because in the third week of July, we haven't seen much in terms of business. But again, there are some indications that in some areas of the market in some countries, things are starting to pick up. It's volatile. We expect it to remain in that way, but the situation is better than it was three months ago. I hope -- I hope I answered your question.

Yeah. You answered my question. You anticipated my next question, which was going to be, had things -- had the momentum kept up into July. And if you look at the weighted average lending spreads on new disbursements, were spread levels fairly consistent through Q2 or did they really spike up at the end of the quarter as well?

That -- those were fairly consistent. Actually, and I would say this publicly well -- as well. I have been surprised as to how resilient they have been. I would not be surprised if they start decreasing, but so far and maybe we have seen a few point decreases in the last couple of weeks, but nothing significant. This is a wave we intend to ride as long as we can. They have been stable for -- rather they had been wide for longer than I thought it would be, given the diminished spread demand.

Okay. So fair way of looking at Q3 and even into Q4, new loan disbursements will probably be plus or minus the same spread for Q2, if not down a little bit but obviously your average loan portfolio spread will continue to increase as you replace stock that's rolling off or re-pricing then, right?

Let me give you some more color so that you get an idea how volatile the quarter was. Disbursements in April were $182 million, in May they were $225 million, and in June they spiked to $617 million. So, it's a -- it's a volatile environment out there and it's difficult for us to predict the month-to-month trend. Again first couple of weeks in July were good, let's see what happens in August and September.

Okay. And one last one for me and then I'll jump out. And that's just go into the loans that you guys are working out right now. Can you tell how many loans there -- how many loans are there; what industry if possible, or what -- what country those are in?

Yes. It's very difficult for me to say anything in general, because the sample is so small, sample is really small. The only thing that I can say in general is that the problems that we are facing are being faced in the countries that are facing the most in terms of economic pressure. We have more potential problems in Mexico than we do in Brazil, for instance.

As to industries, it's really -- again because the sample is so small for us to make a general statement, it just has to do with a handful of specific cases. That's really quite frankly all I can say for the moment. Next quarter, once we finish the restructuring, we'll be able to -- more information, but so far, again I cannot say -- I cannot make general statements beyond the one I just did. The sample is just too small.

Okay, great. Thanks. I'll give someone else a [turn] now.

Sure.

Again if you would like to ask a question, please press star one on your telephone keypad now. Our next question comes from Saul Martinez with JPMorgan.

Hi. Good morning, gentlemen. Just kind of a follow-up question on the asset quality, [right]. I guess I will ask Jeremy's question slightly different. And obviously you are restructuring the $12 million fell into non-accrual status early in July. But are you seeing any early warning signals, in terms of additional loans that may not have fallen into non-accrual status, but you feel that maybe in danger of falling into non-accrual status, or where you may see borrowers facing cash flow pressures or have had late payments and where, and if so, what industries, what regions, I guess you kind of anticipated that a little bit, but what regions, what countries or what industries are you more concerned about?

Again, I can only answer in terms of countries. The riskiest countries where the macro economy is doing worse, that's where we're seeing companies face the biggest type of pressures. As to whether we think that we are going to continue seeing problems as we move forward, probably so, it has been a while now that companies we've had payment delays, a couple of days throughout -- most of the portfolio and to checkout records, we've had -- we had very little or nothing in terms of pass-through loans for a long time.

By the way, like Jaime just said, even the loans that are -- we're currently restructured, restructuring, are actually current as to interest and principal, because the maturities haven't taken place. It's just that we have concluded that when principal maturities do occur, we're probably going to have to give those people more time to pay us back.

Again, the magnitude of the problems that we see coming down the pipeline is anywhere from $25 million to $35 million on which the $12 million in additional specific reserve that we established should be more than enough. That's a fairly conservative provision level on problems that -- on loans that become past due. It's consistent with our experience.

We will just manage them through and see -- and see what happens. If the economic environment doesn't get worse, we will work those out. Just in case, again, we establish reserves, because we need to be technical about it.

Okay. I mean, this is silly -- maybe a silly question, but how do you define whether a loan is in non-accrual status?

We have a system of risk rating.

Okay.

And we do that based on risk ratings.

Okay. So, it's based on your own internal classification. It is not necessarily something that is directly correlated to past due loan status?

That's correct. And that's why I just mentioned the loans that we did put into accrual and actually as of today, still current, but we don't think they are going to be current in a few -- a couple of weeks.

Okay. Got it. Got it. Understood. Thank you very much.

Well, thank you.

(Operator Instructions). Our next question comes from Jose Restrepo with Interbolsa.

Hey, good morning, everybody. I want to ask two questions. Actually, the first one is that we are seeing that the economic figures showed that inside the region and outside the region, the trade is decreasing due to the economic slowdown of the several countries. So in that sense, which is your estimate along growth for '09? If you can give us that guidance.

And my second question is that you have been collecting a lot of loans from different companies around the region. How easy will it be to react to (inaudible) these commercial relations when the economic environment improves in the region? So you are now closing the doors to them and probably they don't want to do business with you in the future.

The second part of your question -- the second question is a strategically very important one. So let me address that first and I can address that fairly, in a fairly direct manner. Those companies from which we collected and we want to retain as clients, we have been able to actually keep an ongoing relationship with them. We've been with them for a long time. They understood perfectly well what we were doing.

There had been a couple of instances of companies where we simply said look, this -- given the new environment in the world, this is probably an industry that is not going to do well. So we reached the decision to literally get out of the companies and that is something that we are not going to feel sorry about.

But for the great majority of cases, in fact, the way we -- Bladex has continued to support them has been way and above what most of our competition has been doing. We have reduced exposure, but we have retained some and keep rolling it over. And that's been very, very valuable for these companies and actually has increased our credibility with them.

So the franchise or the value of the franchise has actually, I believe, increased and our clients, the ones we want to keep, are actually closer to us and think us -- and are more thankful to us now than they were before September. That is not an issue.

Regarding growth in the loan book, you know the figures as well as I do. Trade flows in the region are down anywhere from 20% to 30%. Inter-regional trade flows are in some cases down by even more than that. And yet, because we have less competition and because we have retained or maintained our activity in the region, you saw how in spite of what was a very bad second quarter in terms of trade flows, we were able to actually, marginally increase the portfolio.

I'm not -- we don't expect rapid increases in the portfolio until trade flows start to recover in a serious way. But you can count with some stability or maybe even with some minor growth of the portfolio for the next couple of quarters. Does that provide a sufficiently satisfactory answer for you?

Yes, thank you. And I have another one if you have enough time. Some local banks, for example, the Colombian banks are gearing very strong in the [capital] side through bonds, through IPOs, through share issuance and stuff like that. And they are becoming like a huge competition for Bladex in the region I think because they are taking advantage of the same opportunity that you are facing.

For example, a foreign bank that doesn't have presence in the region, that used to finance Colombian companies, they move out through their [core] markets and Colombian local banks are exploiting that growth opportunity. I think that is the same in the region, so they are becoming a competition for you. And I think they are very good and very big in some countries.

You are right.

My question is, is there -- you are facing that kind of competition, and that competition can pressure the spread -- the lending spread that you are saying they are increasing.

Let me address a couple of the issues that you raised in your question. Firstly, yes, we eventually believe that margins will [close] -- margins will shrink again, not so much because of competition, but because of aggressive return of liquidity to international markets. And that's fine with us. Shrinking margins would probably means decreased risk levels which would allow us to leverage the Company more. That is not something that particularly concerns us.

Competition on the part of Latin American banks becoming somewhat regional in nature is a fact. It is something that we are taking into account in our planning going forward. We have seen that the regionalization that has taken on the part of the -- not only Colombian banks, but Brazilian banks are also starting to move overseas. Their regionalization is partial.

The Colombian banks for instance are concentrating on supporting their companies in Central America mostly. We have the advantage of being able to provide support to Colombian companies, not only in Central America, but also in Mexico, Venezuela, Ecuador, Argentina and Brazil. You are right, there will be some competition on the part of some of the largest local banks in Latin America, and that's fine, (inaudible) both for them and for us.

We have a couple of significant advantages regarding them. We know more of the markets and we know them better. We have been at this for a long time. And we generally provide help where very few other people can. It's easy to support a company in Panama -- Colombian company in Panama for instance. It's a bit more difficult to support a Colombian company in Honduras. We do that and we do that well.

Okay. Thank you very much.

Thank you.

Our next question comes from Arthur Byrnes with Deltec.

Jaime, I was trying to understand a little better the nature of these losses. Last time I saw you several months ago in New York, you had no losses. Now, you've got some. And as a trade financing bank, it would seem to me that you have collateral for these trade loans that you are financing. And I am wondering, is this a trade financing loan that you're having problems with, or is it something in the nature of a different kind of transaction?

Arthur, well firstly, good morning. Great, talking to you.

Thank you very much, sir.

What we established were reserves, reserves against possible or potential loan losses. We establish reserves whenever we think there is a possibility that loan losses will eventually come about. That -- our job now, my job from now on becomes to make sure to prove the estimations of our technical credit risk wrong. If you look at historically, we have always been able to beat our technical estimations of potential losses. In other words, historically our actual losses have been smaller than provisions. I don't know whether that will be the case this time, but that's what we're working on. Again, it's very important for everyone to realize what we did is we established a provision against possible or potential loan losses. We haven't lost the money yet. And we don't expect to, and certainly we are going to make sure to do everything we can to restructure the loans and get them back and get 100% of them back.

Regarding the second part of your question, 63% of our portfolio is trade related in nature. That which is not trade related in nature is how the Company is involved in trade, which is probably the reason why our actual loss experience in the past has been relatively small. I'm confident that that will prove to be the case this time around as well. Restructurings take some time to work out. We know how to do it. (inaudible) how things -- things work out moving forward, but again, if you're worried about these things having been lost, no, they haven't. We just reserved against the possibility of losses arising.

Well, let me just follow-up and ask you, are the loans that you are worried about, secured loans or unsecured loans?

A combination -- again, it's a handful. It's no -- it's public information now that the way trade finance is financed in the region and in the world traditionally, it's generally unsecured. And because it's unsecured -- it's unsecured because it has to be less risky. Secondly, it's also well-known --and statistics bear this out -- when it comes to restructuring loans, companies tend to give priority to their trade finance obligations --

Right.

-- simply because that is their life blood.

Very good.

So, let's see how it goes. Again, as you have in the past, be somewhat patient with us. We know how to manage this type of thing. If there is -- if there ever is a loss, we'll let you know. We haven't lost a penny yet, these are just [reserved].

Right. Thank you very much.

You're welcome.

Our next question will come from Gary Lenhoff with Ironworks Capital.

Thank you. Could you just comment on the level of operating expenses in the quarter? It was down, rather substantially from the first quarter specifically with compensation expense and should we expect these levels of expenses going forward or will they be more like Q1?

Okay. You should see basically going forward the same level. The main difference versus last quarter comes basically from a one-time event that we [did] through severance back in February as well as [through that reduced] that -- there is a difference also in salaries. And also due to the fact that we have less trading gains in the asset management division, we also have less operating expenses in that aspect. So, if you see going forward that we have higher trading gains in the asset management business, the answer will be, we'll have a higher operating expenses, but that will be a nice problem to have.

Okay, great. Thank you very much.

Okay. At this time, there are no further questions in the queue. So, sir, I'll turn it back to you for closing remarks.

Thank you very much. Ladies and gentlemen, I think, or I hope that we have conveyed to you two messages. Firstly, the current position of the Company as we say it's the ongoing financial storm, we have not been -- we have not been unscathed. We do have some problems that we're managing, but our ability to do so, our resources to do so are sufficient, and we are confident that the short-term will work out.

Most importantly, I hope that we have conveyed to you the fact that this crisis is actually going to make the strategic importance of Bladex more relevant and that we're actually going to find ourselves, when trade flows return, even better positioned than we were in the past to grow quickly and to make use of more opportunities, particularly because, again, we have fewer competitors, because we are now one of the few companies with truly regional [reach], and because trade finance we believe is going to be a pillar of the economic recovery in Latin America. That all speaks to significant upside for the Company in our estimation.

We are not going to move ahead at high speed while the storm rages, but once it subsides and the sun comes out, our shutters will be dry and they will be in one piece. We'll set them out and move forward more rapidly even than we were before.

So with that message, I want to thank everyone for your presence and wish you good luck over the next quarter. And again look forward to our next conference call. Thank you very much.

This now concludes the teleconference. You may now disconnect your lines.