Grupo Financiero Galicia SA (GGAL) 2023 Q1 法說會逐字稿

Good day, and welcome to the First Quarter 2023 earnings release. Today's call is being recorded. (Operator Instructions) I will now hand you over to your host, Pablo Firvida to begin today's conference. Thank you.

美好的一天，歡迎來到 2023 年第一季度收益發布。今天的通話正在錄音。 （操作員指示）我現在將您交給主持人 Pablo Firvida，開始今天的會議。謝謝。

Thank you. Good morning, and welcome to this conference call. I will make a short introduction, and then we will take your questions. Some of the statements made during this conference call will be forward-looking statements within the meaning of the safe harbor provisions of the U.S. Federal Securities Laws and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed.

謝謝。早上好，歡迎參加本次電話會議。我先做一個簡單的介紹，然後回答大家的提問。本次電話會議期間發表的一些聲明將屬於美國聯邦證券法安全港條款含義內的前瞻性聲明，並受到風險和不確定性的影響，可能導致實際結果與所表達的結果存在重大差異。

According to the monthly indicator for economic activity, MI, the Argentine economy recorded a 1.3% year-over-year expansion during March. In year-to-date terms, the economic recovery reached 1.5% as compared with the first 3 months of 2022. During the first quarter, the primary deficit reached 0.4% of GDP. This implies an increase as compared to the 0.2% deficit of the first quarter of 2022, results that was explained by the 78.3% increase of revenues whereas primary spending rose 89.8%. The national consumer price index recorded a 21.7% increase during the quarter and a 32% rise between January and April.

根據月度經濟活動指標MI，阿根廷經濟3月份同比增長1.3%。年初至今，與 2022 年前 3 個月相比，經濟復甦達到 1.5%。第一季度，基本赤字達到 GDP 的 0.4%。這意味著與 2022 年第一季度 0.2% 的赤字相比有所增加，收入增長 78.3%，而主要支出增長 89.8%。全國居民消費價格指數一季度上漲21.7%，1-4月上漲32%。

Inflation reached 108 annual variation in April 2023, which entailed an acceleration against April 2022's 58% inflation. With inflation hitting its highest mark in 30 years. On the monetary front, the Argentine Central Bank expanded the monetary base by ARS 165.7 billion in the quarter, recording a 52.8% increase in year-on-year terms.

2023 年 4 月，通貨膨脹率達到了 108% 的年度變化，這使得通貨膨脹率比 2022 年 4 月的 58% 有所加速。通貨膨脹達到30年來的最高水平。貨幣方面，阿根廷央行本季度擴大基礎貨幣1657億阿根廷比索，同比增長52.8%。

The exchange rate averaged ARS 203.1 per dollar in March, a 17.5% increase against the 14.9% peso devaluation average in December. When compared to March 2022, the Argentine peso underwent a 46.1% devaluation. In March 2023, the average rate on peso-denominated private sector time deposits for up to 59 days stood at 71.5%, 30.7 percentage points above the March 22 -- 2022 average. The average rate displayed a similar level to the 70% average recorded last December. However, the Argentine Central Bank has been increasing interest rates as of mid-March and the minimum interest rate for retail and deposits currently stands at 97%.

3 月份平均匯率為 1 美元兌換 203.1 阿根廷比索，比 12 月份平均貶值 14.9% 比索上升 17.5%。與 2022 年 3 月相比，阿根廷比索貶值 46.1%。 2023年3月，以比索計價的私營部門最長59天定期存款的平均利率為71.5%，比2022年3月22日至2022年的平均利率高出30.7個百分點。平均比率與去年 12 月記錄的 70% 的平均水平相似。然而，阿根廷央行自3月中旬起一直在加息，目前零售和存款的最低利率為97%。

Private sector deposits in pesos averaged ARS 17.8 trillion in March, increasing 17.5% during the quarter, and 110.7% in the last 12 months. Time deposits in pesos rose 20% during the quarter and 121.1% in the year, while peso-denominated transactional deposits increased 15.3% during the first quarter and 101.7% in year-on-year terms. Private sector dollar-denominated deposits amounted to $16.4 billion in March, increasing 3.9% during the quarter and 7.1% in the last 12 months.

3 月份私營部門比索存款平均為 17.8 萬億阿根廷比索，本季度增長 17.5%，過去 12 個月增長 110.7%。比索定期存款本季度增長 20%，全年增長 121.1%；比索計價交易存款第一季度增長 15.3%，同比增長 101.7%。 3 月份私營部門美元計價存款達 164 億美元，本季度增長 3.9%，過去 12 個月增長 7.1%。

During March, peso-denominated loans to private sector averaged ARS 7.6 trillion, increasing 13.2% in the quarter and 73.6% when compared to March 2022. While private sector dollar-denominated loans amounted to $3.7 billion recording a 5.8% expansion during the first quarter, but a 4.2% contraction when compared to March 2022.

3 月份，私營部門以比索計價的貸款平均為 7.6 萬億阿根廷比索，本季度增長 13.2%，與 2022 年 3 月相比增長 73.6%。而私營部門以美元計價的貸款達 37 億美元，第一季度增長 5.8% ，但與 2022 年 3 月相比收縮了 4.2%。

Turning now to Grupo Financiero Galicia. Net income for the first quarter amounted to ARS 18.1 billion, 71% higher from the year ago quarter, mainly due to profits from Banco Galicia for ARS 15 billion, from Galicia Asset Management for ARS 2.2 billion, from Galicia Seguros for ARS 697 million and from Naranja X for ARS 607 million. This profit represented a 1.9% annualized return on average assets and a 9.8% return on average shareholders' equity.

現在轉向加利西亞金融集團。第一季度淨利潤為 181 億阿根廷比索，比去年同期增長 71%，主要是由於加利西亞銀行利潤 150 億阿根廷比，加利西亞資產管理公司利潤 22 億阿根廷比，加利西亞安全銀行利潤 6.97 億阿根廷比，以及從 Naranja X 處獲得 6.07 億阿根廷比索。該利潤代表平均資產年化回報率為1.9%，平均股東權益回報率為9.8%。

Banco Galicia's net income for the quarter was 55% higher than in the year ago quarter. The net operating income increased 30% mainly due to 166% increase in results from net interest income, offset by a 34% lower results from financial instruments. Adding up both concepts, the growth was 26%. Average interest-earning assets were up 5%, reaching ARS 2.23 trillion, mainly due to a 38% increase in the average volume of government securities in pesos, offset by an 18% decrease in the average volume of peso-denominated loans.

加利西亞銀行本季度的淨利潤比去年同期高出 55%。淨營業收入增長 30%，主要是由於淨利息收入業績增長 166%，但被金融工具業績下降 34% 所抵消。將這兩個概念加起來，增長率為 26%。平均生息資產增長 5%，達到 2.23 萬億阿根廷比索，主要是由於以比索計價的政府證券平均數量增加了 38%，但以比索計價的貸款平均數量下降了 18%，抵消了這一影響。

In the same period, its yield increased almost 25 percentage points reaching 63.3%. Interest-bearing liabilities increased 2% from the first quarter of 2022, amounting to ARS 1.92 trillion. This growth was mainly due to a 12% increase in the average balance of time deposits in pesos offset by a decrease of the average balance of saving accounts, both in pesos and in dollars and by dollar-denominated time deposits. During this period, its cost increased 23.3 percentage points to 45.5%. Net interest income for the quarter increased 166% from the same quarter of 2022 with interest income growing 124% and interest expenses growing 110% in the same period.

同期，其收益率增長了近25個百分點，達到63.3%。有息負債較2022年第一季度增加2%，達1.92萬億阿根廷比索。這一增長主要是由於比索定期存款平均餘額增加了 12%，但被比索和美元儲蓄賬戶平均餘額以及美元定期存款的減少所抵消。在此期間，其成本增加了23.3個百分點，達到45.5%。本季度淨利息收入較 2022 年同季度增長 166%，同期利息收入增長 124%，利息支出增長 110%。

Net fee income increased 14% from March 2022, mainly due to a 47% increase of fees on collection and a 9% increase of fees from credit cards. Net income from financial instruments decreased 34% as a consequence of the change in the valuation model of the instruments issued by the Argentine Central Bank from fair value to amortized costs.

淨費用收入較 2022 年 3 月增長 14%，主要由於託收費用增加 47%，信用卡費用增加 9%。由於阿根廷中央銀行發行的工具的估值模型從公允價值改為攤餘成本，金融工具的淨利潤下降了34%。

Gains from gold and FX quotation differences were 253% higher from the year ago quarter, including the results from foreign currency trading. As regards to provisions, for loan losses, the amount for the quarter was 92% higher than those recorded in the year ago quarter, reaching ARS 9.1 billion. Personnel expenses were 22% higher than in the first quarter of 2022 primarily due to salary increase agreements with the union and to a 4% increase of staff, while administrative expenses were 7% lower due to lower expenses for maintenance and repairment of goods and IT and for higher administrative services.

黃金和外匯報價差異帶來的收益比去年同期高出 253%，其中包括外幣交易的結果。至於準備金，本季度貸款損失金額比去年同期高出 92%，達到 91 億阿根廷比索。人事費用比 2022 年第一季度增加 22%，主要是由於與工會達成加薪協議以及員工數量增加 4%，而管理費用減少 7%，因為商品和 IT 維護和維修費用減少以及更高級別的行政服務。

Other operating expenses increased 52% due to higher turnover tax on financial operations as a consequence of the increase in the holdings of Leliqs. The income tax charge was 15% higher than in the first quarter of 2022 with an effective tax rate of 28.6%. The bank's financing to the private sector reached ARS 1.26 trillion at the end of the quarter, down 9% in the last 12 months mainly due to a 14% decrease of peso-denominated loans. Exposure to public sector increased 17% year-over-year and excluding the exposure to Central Bank, net exposure represented 12% of total assets compared to a 19% as of the end of the first quarter of last year.

由於增持 Leliqs 導致金融業務流轉稅增加，其他運營費用增加 52%。所得稅費用比 2022 年第一季度高出 15%，有效稅率為 28.6%。截至本季度末，該銀行對私營部門的融資達到 1.26 萬億阿根廷比索，在過去 12 個月內下降了 9%，主要是由於比索計價的貸款減少了 14%。公共部門的風險敞口同比增長 17%，不包括中央銀行的風險敞口，淨風險敞口占總資產的 12%，而去年第一季度末為 19%。

Deposits reached ARS 2.26 trillion, 2% lower than a year before mainly due to decreases of checking and saving accounts in pesos, partially offset by a higher balance of peso-denominated time deposits. The Bank's estimated market share of loans to private sector was 11.69%, 39 basis points lower than at the end of the year ago quarter. And the market share of deposits from the private sector was 9.75%, 44 basis points lower than in the same quarter of the previous year.

存款達到 2.26 萬億阿根廷比索，比上年下降 2%，主要是由於比索支票和儲蓄賬戶減少，但部分被比索計價定期存款餘額增加所抵消。該行預計私營部門貸款市場份額為11.69%，比上季度末下降39個基點。民間存款市場份額為9.75%，比上年同季度下降44個基點。

As regards to asset quality, the ratio of nonperforming loans to total financing ended the quarter at 2.50% recording a 61-basis point improvement as compared to the 3.11% of the first quarter of the prior year. At the same time, the coverage with allowances reached 186%, up 580 basis points from the 180.2% recorded a year ago. As of the end of March, the bank's total regulatory capital ratio reached 23.47%, decreasing 62 basis points from the end of the same quarter of the previous year. The bank's liquid assets represented 114% of transactional deposits and 57% of total deposits, up from 94% and 52%, respectively, from a year before.

資產質量方面，本季度不良貸款佔融資總額的比率為2.50%，較上年一季度的3.11%提高61個基點。與此同時，補貼覆蓋率達到186%，比一年前的180.2%提高580個基點。截至3月底，該行總監管資本率達到23.47%，較上年同季末下降62個基點。該銀行的流動資產佔交易性存款的114%和總存款的57%，高於去年同期的94%和52%。

In summary, in a very challenging and volatile market environment, Grupo Financiero Galicia was able to keep asset quality, liquidity and solvency metrics at very healthy levels and to improve its profitability in spite of the significant impact of the very high inflation of the quarter.

總而言之，在充滿挑戰和動蕩的市場環境中，儘管本季度通脹率極高，但 Grupo Financiero Galicia 仍能夠將資產質量、流動性和償付能力指標保持在非常健康的水平，並提高盈利能力。

We are now ready to answer the questions that you may have. Thank you.

我們現在準備回答您可能提出的問題。謝謝。

(Operator Instructions) Our first question comes from Brian Flores from Citibank.

（操作員說明）我們的第一個問題來自花旗銀行的 Brian Flores。

I have 2 questions. The first 1 is on the technical side. I wanted to ask on the classification of the securities. Just can you elaborate a bit on what is the rationale behind this and what treatment would you give to the securities? And then the second is just a follow-up regarding discussions on ROE for 2023. I think we mentioned somewhere around 9% inflation adjusted, just wanted to know with this [harder] perhaps environment, you reiterating this figure?

我有 2 個問題。第一個是技術方面的。我想問一下證券的分類。您能否詳細說明一下這背後的理由是什麼以及您將如何對待這些證券？第二個只是關於 2023 年 ROE 討論的後續行動。我想我們在某個地方提到了 9% 左右的通脹調整後，只是想知道在這種[更困難]的環境下，您是否重申了這個數字？

Brian. Well, the first question regarding the change in the model of accounting of Leliqs. Basically, that is the instrument issued by the Argentine Central Bank that changed from fair value to amortized cost. At the beginning of the year, the accounting department decided to change that because when Leliqs were first issued by the Central Bank, we thought they were going to be instruments for trading that could be purchased and sold within the month. Actually, as they are so short, they are issued for 28 days, and the average maturity is roughly 14 days. We decided to account them as amortized cost.

布萊恩.嗯，第一個問題是關於 Leliqs 會計模式的變化。基本上，這是阿根廷央行發行的工具，從公允價值變為攤餘成本。今年年初，會計部門決定改變這一點，因為當中央銀行首次發行 Leliqs 時，我們認為它們將成為可以在一個月內買賣的交易工具。實際上，由於它們很短，發行期限為28天，平均期限約為14天。我們決定將它們記為攤餘成本。

So in -- I would say, the main output for your analysis is that in the past, the interest coming from the Leliqs were within results from financial instruments while now they are within interest from public securities within financial income basically. It makes, I would say, the comparison easier. And in this way, I think we are aligned with most of our peers in terms of accounting the results from Leliqs.

因此，我想說，您分析的主要輸出是，過去，來自 Leliqs 的利息屬於金融工具的結果，而現在它們基本上屬於金融收入中公共證券的利息。我想說，這使得比較更容易。通過這種方式，我認為我們在計算 Leliqs 的結果方面與大多數同行是一致的。

The second question regarding ROE. The first quarter was 9.8%, and we think we can maintain this level for the full year. So we're around 10% ROE for 2023.

第二個問題，關於ROE。第一季度為9.8%，我們認為全年可以保持這個水平。因此，2023 年的 ROE 約為 10%。

Our next question comes from Yuri Fernandes from JPMorgan.

我們的下一個問題來自摩根大通的尤里·費爾南德斯。

I have a question regarding cost. It was very good like noninterest expenses this quarter. So my question is, how should we think about this? Like how much room has (inaudible) to continue delivering on cost? And what should expect? That's the first one. And just a follow-up on the Leliq on you moving from trading to kind of hedge maturity from what I understood. The Leliq rates are higher now, right? Like there was a big increase in April, another 1 now in May. And being at amortizing cost, we should not see any mark-to-market impact, but you should accrue lower interest, right, on those secured. So just trying to understand like what is the impact of higher Leliqs f you, like I imagine positive, but would love to hear like your thoughts on how higher rates impact to your securities book and your margins going forward?

我有一個關於費用的問題。就像本季度的非利息支出一樣，情況非常好。所以我的問題是，我們應該如何思考這個問題？比如有多少空間（聽不清）來繼續降低成本？應該期待什麼？這是第一個。根據我的理解，這只是 Leliq 的後續內容，關於您從交易轉向對沖成熟度的情況。現在 Leliq 的利率更高了，對嗎？就像四月份有一個很大的增長，現在五月份又增加了一個。以攤銷成本計算，我們不應該看到任何按市值計價的影響，但你應該對那些擔保的人產生較低的利息，對吧。因此，只是想了解更高的 Leliqs 對您的影響是什麼，就像我想像的積極的那樣，但很想听聽您對更高的利率如何影響您的證券賬簿和未來的利潤率的想法？

Okay. First, on costs. you could see an increase in personnel expenses and a decrease in administrative expenses. I'd like to see them together because part of the increase in personnel expenses was due to a 4% increase in staff. And basically, that is something that the bank has been doing in the last couple of quarters, I would say, that is in hiring IT people that used to be third-party suppliers. So it was in hired services, and now they became a part of our staff. So basically, when you look at the number of employees, you will see a slight increase. And the main trend, I would say, is more IT guys. And well, you will not see it, but the net effect is that there is a reduction in people of, I would say, all tasks mainly in the branch network, we are seeing some slight reduction there. The objective for us is to keep reducing as a whole the expenses, it's, I would say, 1 of the main variables we can manage with not only in terms of personnel that in the last couple of years, the total number of employees has been decreasing between 4% and 5% per year, but also the rest of administrative expenses.

好的。首先，關於成本。您可以看到人員費用增加，管理費用減少。我希望看到他們在一起，因為人事費用增加的一部分是由於員工數量增加了 4%。我想說，基本上，這就是該銀行在過去幾個季度一直在做的事情，那就是僱用曾經是第三方供應商的 IT 人員。所以這是僱傭服務，現在他們成為了我們員工的一部分。所以基本上，當你查看員工數量時，你會發現略有增加。我想說，主要趨勢是更多的 IT 人員。好吧，你不會看到它，但最終的效果是人員減少，我想說，所有任務主要在分支機構網絡中，我們看到那裡有一些輕微的減少。我們的目標是不斷減少整體開支，我想說，這是我們可以管理的主要變量之一，不僅在人員方面，在過去幾年中，員工總數已每年減少 4% 至 5%，還有其餘的管理費用。

So the -- I would say the guidance would be a couple of percentage points below inflation. And when we think about personnel expenses, we have this target of a slight reduction in number of people, but of course, we are every -- or many times a year now within negotiation with the union that typically try to match salary increases with inflation, perhaps with some lags in certain quarters or in other quarters, salary increases slightly higher than the inflation but for the full year, should be the same.

因此，我想說，這一指導將比通脹率低幾個百分點。當我們考慮人事費用時，我們的目標是稍微減少人數，但當然，我們每年或每年多次與工會進行談判，通常試圖將工資增長與通貨膨脹相匹配也許在某些季度或其他季度存在一些滯後，工資增幅略高於通貨膨脹率，但全年應該是相同的。

In terms of Leliqs, we invest the money, the liquidity we are having as deposits are growing much more than loan demand. And the interest rate is determined by the Central Bank. Now the Leliqs stands at 97%. And the higher the interest rate and the higher the stock of the Leliqs the more significant or the bigger impact on interest income. The change in valuation really doesn't have any impact in terms of potential shadow or difference between book value and market value because, as I said, there are maturities 14 days, and we keep them till they mature. So this is basically a change of, I'd say, of -- it was a decision trying to reflect really the reality and not what we did at the beginning that was seen at the trading instrument. And now it's really an instrument that is to keep liquidity or to invest our liquidity in this instrument.

就 Leliqs 而言，我們投資資金，我們擁有的流動性，因為存款的增長遠遠超過貸款需求。而利率是由央行決定的。現在 Leliqs 的利用率達到了 97%。而且利率越高、Leliqs 存量越高，對利息收入的影響越顯著或越大。估值的變化實際上不會對賬面價值和市場價值之間的潛在影子或差異產生任何影響，因為正如我所說，期限為 14 天，我們將其保留直至到期。所以我想說，這基本上是一個改變——這是一個試圖真實反映現實的決定，而不是我們一開始在交易工具上看到的所做的事情。現在它實際上是一種保持流動性或將我們的流動性投資於該工具的工具。

(Operator Instructions) There are no further questions. I would like to hand the call over to your host to conclude today's conference. Thank you.

（操作員說明）沒有其他問題。我想將電話轉交給東道主，以結束今天的會議。謝謝。

Okay. Thank you, Naomi. Thank you all for attending in this call. If you have any further questions, please do not hesitate to contact us. Good morning. Have a nice long weekend here in Argentina.

好的。謝謝你，內奧米。感謝大家參加本次電話會議。如果您還有任何疑問，請隨時與我們聯繫。早上好。祝您在阿根廷度過一個愉快的長周末。

That concludes today's event. Thank you for your participation. You may now disconnect. Thank you.

今天的活動到此結束。感謝您的參與。您現在可以斷開連接。謝謝。