Grupo Supervielle Reports 1Q23 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-months period ended March 31, 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 first quarter 2023 results, Patricio Supervielle, Grupo Supervielle’s Chairman & CEO, noted: “We started the year delivering ROE of 2% in real terms in the quarter, despite the increasingly challenging macroeconomic and political environment and on track to return to profitability.

Our initiatives to optimize operations and streamline our network have achieved significant cost savings when compared with the same period of the prior year. Key among those were personnel expenses, which declined nearly 12% year-on-year in real terms.

Reflecting our focus on profitability, NIM increased to 21.9% from 19.2% in the year-ago quarter driven mainly by the good performance from our short-term central bank and government securities portfolio, on the back of higher interest rates. This more than offset a contraction in the credit portfolio as we benefitted from our flexibility in managing assets and liabilities.

Lower loan volumes together with accelerated inflation which increased pressure on individuals´ disposable income, drove a 60 basis points sequential increase in the NPL ratio to 4.1% - a situation we anticipated and increased provisions in the prior quarter. In the current context, we have implemented stricter credit scoring. Consequently, we are prioritizing cross selling of our existing client portfolio, particularly insurance, investment products and personal loans to payroll customers. On the corporate front, we are focused on lending and transactional services to our key target segments that include SMEs and Middle-Market companies.