Grupo Supervielle S.A. (SUPV) Q1 2026 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call summary and Q&A indicate positive sentiment: strong loan growth projections (25-30%), deposit growth (20-25%), and a stable NPL ratio (5-6%). Personnel expenses savings and a strong reserve coverage ratio (100%) are notable positives. Despite some revenue declines, the focus on growing high-value customers and strategic financing in energy and mining sectors is promising. Management's optimism about sovereign risk premium compression and economic stabilization further supports a positive outlook. However, the lack of specific guidance on certain issues and the decline in total deposits are minor concerns.
Key Financial Performance
Net Loss AR$17 billion in the quarter, improving from AR$21 billion loss in the prior quarter. The improvement was driven by lower credit costs and reduced underlying expenses.
Adjusted Net Income AR$6.7 billion after excluding the one-time AR$23.8 billion severance charges. This reflects the underlying profitability of the business.
Net Interest Margin (NIM) 17.7%, compared to 18.8% in Q4 2025. The decline was due to rate volatility during the period, but margins improved towards March as volatility eased.
Cost of Risk 6% in the quarter, down from 10.4% in Q4 2025. This improvement reflects moderation in new inflows and the impact of collection and refinancing initiatives.
Non-Performing Loan (NPL) Ratio 5.6% at quarter-end, up from 5% in December 2025. However, the ratio peaked in February and showed improvement in March, indicating stabilization.
Total Loans Declined 5.6% sequentially due to subdued credit demand in local currency and a cautious underwriting approach. U.S. dollar loans grew 13% in original currency terms, but peso appreciation reduced balances when translated to pesos.
Total Deposits Declined 4.7% sequentially as higher-cost wholesale peso funding was deliberately reduced. Retail and commercial deposits increased 22% year-over-year in real terms.
Personnel Expenses Savings Annual savings of approximately AR$33 billion are expected due to a headcount reduction of 15% across the bank ecosystem.
Assets Under Custody (invertironline) Approximately $2.7 billion, up from $2.2 billion a year ago, reflecting growth in the ecosystem.
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Operating Highlights
AI-enabled investment experience: Launched by invertironline, powered by Claude, allowing customers to interact with portfolios, access market insights, and manage investment decisions through natural language.
U.S. dollar loans growth: Grew 13% in original currency terms, although peso appreciation masks growth when reported in local currency.
Cuenta Hit IOL: Launched to drive client acquisition within the ecosystem, reaching approximately 13,000 new accounts in March.
Voluntary retirement plan: Implemented to align operating model with evolving customer behavior, reducing workforce by 15% to date, resulting in annual savings of approximately AR$33 billion in personnel expenses.
Funding mix optimization: Reduced higher-cost wholesale deposits and strengthened deposit quality, with retail and commercial deposits increasing 22% year-on-year in real terms.
Cost of risk improvement: Improved by 400 basis points to 6% from 10% in the fourth quarter, indicating credit costs peaked at the end of last year.
Ecosystem strategy and cross-selling initiatives: Continued execution, particularly through invertironline, with assets under custody reaching approximately $2.7 billion, up from $2.2 billion a year ago.
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Risk or Challenges
Loan Demand and Origination: Decline in local currency loan demand and a cautious approach to origination due to elevated delinquency levels and subdued credit demand.
Asset Quality: NPL ratio increased to 5.6% at quarter-end, reflecting prior credit stress, though it showed signs of stabilization in March.
Credit Costs: High credit costs, though improving, with cost of risk at 6% in Q1, down from 10.4% in Q4 2025.
Severance Charges: Extraordinary severance charges of AR$23.8 billion contributed to a net loss in the quarter.
Funding Base: Deliberate reduction in higher-cost wholesale peso funding, leading to a 4.7% sequential decline in total deposits.
Economic and Monetary Conditions: High inflation, rate volatility, and tight monetary conditions negatively impacted activity and profitability.
Regulatory and Policy Risks: Dependence on policy execution, including fiscal discipline, monetary normalization, and easing FX restrictions, to maintain confidence and reduce volatility.
Operational Efficiency: Headcount reduction of 15% to align with digital migration, though it incurred significant severance costs.
Market-Related Income: Normalization of market-related income after a strong Q4 2025, impacting overall financial performance.
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Guidance & Outlook
Real Loan Growth: Expected to grow between 20% and 25% in 2026, revised down from prior guidance of 25% to 30%. Growth will be skewed towards corporate lending in the near term, with retail credit gradually recovering alongside improvements in economic activity, employment, and disposable income.
Deposits Growth: Expected to expand between 10% and 15%, revised down from prior guidance of 20% to 25%, reflecting continued stringent monetary policy.
Non-Performing Loan (NPL) Ratio: Expected to range between 5% and 5.5% during 2026, reflecting stabilization in asset quality.
Net Cost of Risk: Expected to range between 5.3% and 5.8% for the full year, improved from prior guidance of 5.5% to 6%.
Net Interest Margin (NIM): Expected to range between 15% and 18%, revised up from prior guidance of 14% to 16%, due to higher expected inflation and nominal rates.
Net Fee Income Growth: Expected to grow broadly in line with inflation, revised down from prior guidance of 5% real growth, due to softer asset management fees and normalized brokerage activity.
Adjusted Operating Expenses: Expected to decline between 2% and 4% in real terms, driven by headcount reductions and cost discipline, partially offset by investments in growth initiatives.
Reported Return on Equity (ROE): Expected to range between 2% and 6%, revised down from prior guidance of 4% to 9%, reflecting the impact of headcount optimization. Adjusted ROE (excluding severance charges) is expected to range between 6% and 10%.
CET1 Ratio: Expected to end the year between 11% and 13%, unchanged from prior guidance, supporting disciplined growth while maintaining a strong capital position.
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Shareholder Return Plan
The selected topic was not discussed during the call.
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Key Q&A
Q:What is the current reserve coverage ratio and how does it compare to other Latin American banks?
A:The reserve coverage ratio is around 100%, which is above the industry average. Management believes it is appropriate given the portfolio composition, with 37% retail loans (10% mortgages) and 63% commercial loans, which require less provision.
Q:Will the reserve coverage ratio increase if the NPL ratio improves throughout the year?
A:Yes, the reserve coverage ratio should increase with loan growth and an improved NPL ratio, but it will also depend on the portfolio mix. Higher retail growth would require higher provisions.
Q:How does the government plan to address high deposit requirements and other deregulations?
A:Management expects easing of peso-denominated reserve requirements once the government secures refinancing of bonds in the international market. They also anticipate lifting foreign exchange controls and unlocking the social security sustainability fund to support mortgage securitization.
Q:What is the update on the RIGI projects and Supervielle's role in financing SMEs or suppliers?
A:The RIGI project pipeline is valued at $100 billion, with significant impact expected for Banco Supervielle. The bank focuses on financing the value chain of dynamic industries like energy and mining.
Q:What is the impact of the rightsizing initiative and headcount reduction?
A:The voluntary retirement program is expected to save AR$33 billion annually, with full savings realized by Q3 and Q4 2023. Management does not anticipate another similar program in 2026.
Q:What is the outlook for NPLs and stabilization efforts?
A:NPLs are expected to stabilize between 5.5%-5.7% and decrease to 5%-5.5% by year-end. Stabilization is driven by stringent origination policies, collection initiatives, and structural changes in collection processes.
Q:What caused the decline in revenue and net income for invertironline despite customer growth?
A:The decline is due to a shift from FX-driven brokerage activity to more stable investment operations. Management is focusing on monetizing customers through recurring and resilient revenue streams, growing AUC, and targeting high-value customers.
Q:What caused the movement in deposits this quarter and what is the outlook?
A:Public sector deposits and savings accounts increased. Management attributes this to selective account remuneration strategies and expects peso constraints to continue under current government policies.
Q:What are the drivers for accelerating ROE to high single digits or low double digits?
A:Drivers include efficiency from headcount reduction, improved asset quality, loan growth on both commercial and retail sides, and growth in fee income from banking and asset management.
Q:What is the pipeline for corporate financing in oil, gas, and mining sectors?
A:Supervielle has specialized teams and infrastructure in key industrial hubs like Anelo and San Juan. They focus on financing value chains in dynamic industries and are optimistic about growth in these sectors.
Q:What are the prospects for sovereign risk premium compression in the next 6-12 months?
A:Management is optimistic about sovereign risk premium compression, citing successful debt issuances like the City of Buenos Aires' bond and potential government refinancing of bonds with multilateral guarantees.
Q:How does the current economic environment compare to past stabilization programs?
A:Management compares it to the convertibility era, which saw significant growth in loans to GDP. They believe a successful stabilization program could similarly transform the financial industry.
Q:Can Supervielle accelerate to a fintech business model like Revolut or Nu?
A:Supervielle focuses on reducing cost-to-serve, targeting specific customer clusters, and financing value chains in dynamic industries. They aim to differentiate from fintechs by leveraging their banking infrastructure and expertise.
Q:Review of Unclear Management Responses
A:Management avoided providing specific details on how much the reserve coverage ratio might increase or the exact timeline for easing deposit requirements and lifting foreign exchange controls. Additionally, they did not clarify the exact impact of sovereign risk premium compression on the bank's operations.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
AI investment
AR return
Asset quality
CEO Gustavo
CEO today
CFO CEO
Chief Treasury
Conditions interest
Foreign Language
Global Market
IMF staff
IRO Instructions
Instructions Foreign
activity
channel
cost base
currency lending
customer behavior
delinquency
demand currency
discipline
driver
ecosystem
experience
funding mix
invertironline
model customer
network
peak
plan model
profile
progress
retirement plan
service
severance charge
sign stabilization
view
visibility
SUPV Transcript
Grupo Supervielle S.A. (SUPV) Q1 2026 Earnings Call Transcript
Positive5-8
The earnings call summary and Q&A indicate positive sentiment: strong loan growth projections (25-30%), deposit growth (20-25%), and a stable NPL ratio (5-6%). Personnel expenses savings and a strong reserve coverage ratio (100%) are notable positives. Despite some revenue declines, the focus on growing high-value customers and strategic financing in energy and mining sectors is promising. Management's optimism about sovereign risk premium compression and economic stabilization further supports a positive outlook. However, the lack of specific guidance on certain issues and the decline in total deposits are minor concerns.
Grupo Supervielle S.A. (SUPV) Q4 2025 Earnings Call Transcript
Unknown3-3
The earnings call reflects a mixed sentiment. While there are positive signs such as strong net financial income and growth in core transactional balances, there are concerns about increased loan loss provisions and declining deposits. The Q&A highlights management's cautious optimism about future improvements in ROE and market conditions, but immediate challenges like high NPLs and no dividends in 2026 dampen enthusiasm. The strategic focus on growth and reforms provides a balanced outlook, resulting in a neutral sentiment overall.
Grupo Supervielle S.A. (SUPV) Q3 2025 Earnings Call Transcript
Unknown11-26
The earnings call highlights several negative factors: rising NPL ratio, significant decline in NIM, net loss, and regulatory uncertainties. The Q&A reveals optimism for future growth but lacks specific details, and management's vague responses on key issues add uncertainty. Despite some positive elements like deposit growth and potential long-term ROE improvement, the immediate financial challenges and lack of clear guidance suggest a negative short-term market reaction.
Grupo Supervielle S.A. (SUPV) Q2 2025 Earnings Call Transcript
Unknown8-19
The earnings call presents a mixed picture: strong loan growth and NIM expansion are positive, but increased loan loss provisions and a rising NPL ratio are concerning. The Q&A section reveals uncertainties around NPL trends and cost of risk, with management providing vague responses on key issues. Although some strategic initiatives are promising, the revised growth guidance and macroeconomic challenges temper optimism. Overall, the sentiment remains neutral as positive elements are balanced by risks and uncertainties.
SUPV Slides
SUPV Report
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