BMA

Good morning, and welcome to Banco Macro second quarter 2026 earnings conference call. Thank you all for joining us today. Banco Macro second quarter earnings release was distributed yesterday, and it is available on our investor relations website. For this quarter's call, we are also introducing an earnings call presentation, which will accompany today's remarks. The presentation will be available on our website following the call. Please note that this call may include forward-looking statements, and please refer to our SEC filings for further information. All figures discussed today are in Argentine pesos and have been restated in terms of the measuring unit current at the end of the reporting period in accordance with Central Bank regulations. With that, let me briefly introduce today's speakers.

We have with us today Juan Parma, Chief Executive Officer of Banco Macro, Jorge Scarinci, Chief Financial Officer of Banco Macro, and myself, Nicolás Torres, Investor Relations from Banco Macro. I will now briefly comment on the second quarter 2026 macroeconomic context before moving on to the bank's second quarter 2026 financial performance. Economic activity moderated after the first quarter, with April and May economic activity averaging 0.8% below the first quarter of 2026. Agriculture and mining offset weakness in manufacturing and commerce. Inflation declined throughout the quarter from 2.6% in April to 1.9% in June. On rates, tomorrow declined from 26.3% at the end of March to 22.7% at the end of June. On the exchange rate, ARS depreciated 7.3% during the quarter, remaining stable throughout April and May before weakening in June.

On credit, growth remained muted. Finally, system asset quality remained under pressure. System NPLs increased from 7.6% in March to 7.7% in May, which is the latest available data, with household delinquency at 12.8% versus 3.5% for corporates, while coverage declined from 90.1%-86.3%. Turning to our main figures, starting on the left, second quarter net income totaled ARS 206.8 billion, increasing 39% quarter-on-quarter and 4% year-on-year. The improvement was mainly driven by higher results from financial instruments at fair value through P&L and lower loan loss provisions, and a foreign loss from the net monetary position.

Net operating income before administrative expenses reached ARS 1.29 trillion, down 2% quarter-on-quarter and up 1% year-on-year. Operating income after administrative expenses was ARS 603.8 billion, down 1% quarter-on-quarter and up 1% year-on-year. Moving to the left-hand side, adjusted net income reached ARS 221 billion, implying an adjusted annualized ROE of 14.3%. This excludes ARS 14.2 billion in after-tax restructuring expenses in line with the restructuring impact that we saw in the first quarter. On efficiency, our efficiency ratio was 33.9%, stable year-on-year as we continue to execute on the bank's efficiency transformation. Finally, our reported NPL ratio was 6.25% as of June 2026.

This remained below the 7.7% reported for the system as of May 2026, while the coverage ratio stood at 95.4% above the market's 86.3% of May. Before moving on to the detailed financial performance, let's review the main highlights of the quarter. First, we registered double-digit net income growth, with net income up 39% quarter-on-quarter to ARS 206.8 billion. This result represents an annual ROE of 13.4%, while adjusted ROE is still at 14.3%, up 4.4 percentage points from the last quarter. Second, margins remained stable. Net interest income remained stable while deposits continued to represent 76% of liabilities as the average cost of interest-bearing liabilities fell below 20%. Third, we continued executing on efficiency, including another 18 branch closures during the quarter.

The after-tax restructuring charges remained almost unchanged quarter-over-quarter at ARS 14 billion. Fourth, asset quality continued to outperform the system, with NPLs at 6.25% below the system's 7.7%, and moreover, coverage stood at 95.4% above the system's 86.3%. Fifth, lending growth remained challenging. Total lending increased 3% quarter-on-quarter, supported by commercial growth, while on a yearly basis, total financing decreased 5%. Our private sector loan market share remains stable at 8.2%. Sixth, our balance sheets remain strong with a Tier 1 ratio of 28% and ample liquidity, both fundamental for pursuing growth and strategic opportunities. Now, let's turn to the quarter-over-quarter P&L variations breakdown.

Net income increased ARS 57 billion quarter-on-quarter due to higher income from government securities for valued profit or loss, lower loan loss provisions, and lower loss from the net monetary position. Net interest income decreased 1% or ARS 7.4 billion quarter-on-quarter, as lower funding costs mostly offset lower loan yields and average lending volumes. Income from securities decreased 18% to ARS 30.5 billion quarter-on-quarter. In the first quarter of 2026, a ARS 71 billion one-off result from the sale of bonds was recorded. Net fee income decreased 2% or ARS 4.6 billion in the quarter, as higher mutual funds and securities fees were offset by lower credit and debit card fees, as well as lower corporate services fees.

Loan loss provisions decreased 24%, or ARS 60.7 billion in the quarter, mainly reflecting the lower commercial delinquency while keeping coverage at an adequate level. Personal administration expenses increased to ARS 26.6 billion, led by personal and marketing and risk costs, while achieving extraordinary efficiency. The other major positive driver of the quarter was the result from the net monetary position. The loss was ARS 102.1 billion, smaller than the first quarter, reflecting the decline in quarterly inflation. Finally, income tax and other items contributed ARS 7 billion to the quarter-on-quarter by efficiency. Lower other operating expenses more than offset the higher income tax rate registered in the quarter. Altogether, these factors explain the increase in reported ROE from 10% in the first quarter to 13.4% in the second quarter. Slide seven shows the impact of the restructuring program on reported profitability.

Reported net income was ARS 206.8 billion during the quarter. We recorded ARS 14.2 billion of after-tax restructuring charges related mainly due to early retirement plans and certain payment provisions. Excluding these charges, adjusted net income would have reached ARS 221 billion, implying an adjusted annualized ROE of 14.3% and adjusted ROA of 3.5%. These expenses are part of the efficiency program we have been implementing to create a more agile operating model and a lower structural cost base. Moving to our second quarter 2026 assets and liabilities performance, you can see the evolution of our balance sheet mix and pricing of both assets and liabilities. On the asset side, loans increased 3% at quarter end and represent 45% of total assets, while government securities make up 25% of our assets.

Assets yield declined 280 basis points quarter-on-quarter, from 44%-41% in the second quarter, reflecting a 327 basis points decline in the average lending rate, while the average volume of loans increased 3%. On the liability side, deposits continued to represent 76% of total assets. Total deposits reached ARS 14.7 trillion, down 1% quarter-on-quarter and up 4% year-on-year. Funding costs declined 350 basis points quarter-on-quarter, from 24%-19%, due to a 310 basis points decline in the average rate paid on deposits, while the average volume of deposits decreased 3%. Funding costs declined faster than the asset yield, driven by lower private sector peso deposit rates. Turning to slide 10, the gross credit portfolio, shown on the left, continued growth to ARS 12.6 trillion, increasing 3% quarter-on-quarter.

Commercial lending was the main driver of the increase, while consumer lending grew more moderately and represented 71% of the gross portfolio at quarter end, compared with 29% for commercial loans. Loans and other financing reached ARS 11.7 trillion, with private sector financing up 3% quarter-on-quarter, including 2% growth in peso lending and 1% growth in US dollar lending, while our private sector loan market share remains stable at 8.2%. On the right-hand side, net interest income reached ARS 1.03 trillion, stable compared with the first quarter and 11% above the second quarter of last year. Net interest margin, including FX, declined from 25% to 24%, mainly due to a lower FX contribution. Excluding FX, net interest margin increased 30 basis points from 23.8% in the first quarter to 23.5% in the second quarter.

Moving on to asset quality, the left-hand chart shows our reported NPL ratio increasing from 5.4% in the first quarter of 2026 to 6.5% in the second quarter. As we explained last quarter, the reported NPL ratio is affected by mandatory customer representation that take into account a customer's behavior across the financial system. Our Stage 3 loans ratio increased 30 basis points from 3.8% to 4.1%. Our coverage ratio stood at 95.4%. This remained above the 86.3% level for the system as of May 2026. It is important to mention that coverage Stage 3 loans reached 148.8% in the second quarter. The right-hand chart shows the different trend by segments. Commercial NPLs improved to 2.9% from 1.3% in the first quarter and remain well below the system's average of 3.5%. Consumer NPLs increased to 8.4% from 6.9% last quarter, but also remained below the 12.8% reported for the system.

Turning to efficiency, operating expenses, shown on the left, reached ARS 450 billion in the second quarter. Employee benefits increased 7% quarter-on-quarter, and administrative expenses increased 8%. As a result, the efficiency ratio increased from 32% to 34%. The chart on the right shows the continued streamlining of our operating model. We ended the quarter with 402 branches, 18 fewer than in March and 89 fewer than one year ago. Headcount declined to 8,180 employees, down 1% quarter-on-quarter and 8% year-on-year. These actions are part of the restructuring program with the objective of increasing efficiency and agility while preserving the reach and service capabilities of our franchise. Slide 13 shows the capital and liquidity remaining key strengths. On the left, our Tier 1 capital ratio stood at 28%, compared with an 11.5 regulatory requirement.

On the right, the loan-to-deposit ratio increased to 79%, while liquid assets remained equivalent to 74% of our deposits. Our capital and liquidity positions therefore continue to provide significant capacity to support growth and generate strategic opportunities. Before opening the call for questions, I would like to spend a few minutes discussing our long-term transformation. I will now let Juan Parma, our CEO, to comment on strategy.

Good morning, everyone. Pleased to be here with you. I am going to cover quickly a couple of slides of our trajectory to 2030, basically the execution of our strategic plan that we presented back in December last year. As a recap, our purpose is to be the leading bank for a thriving Argentina, recognized for excellence in customer service and value proposition with four strategic pillars and four enablers. The four strategic pillars are simplicity, which means providing customers with simple, intuitive, and increasingly digital day-to-day effective experiences. That takes us to the next phase, which is once customers find us simple to operate, they will give us our primacy. As we know, primary customers are eight to nine times more profitable than non-primary ones. So it is critical to move to the second pillar, which is moving customers from non-primary to primary. The third one is development.

That has to do with helping and supporting our customers to develop into the future with wealth management, with long-term lending, with insurance to protect their wealth and their families and their lives. So, we multiply the value of our customers with more cross-sell, with future-looking value propositions. Finally, what has to do with how do we service our customers, which has to do with the application of data technology, internet, artificial intelligence in our distribution models while keeping the human touch. That is digital plus human. Of course, as enablers, take data and AI, our talent, efficiency to fund our investment in strategic areas. We need to reduce our physical structure, our less value-adding expenses to fund our investment into the growth areas, and financial risk management to make our results sustainable into the future.

The good thing is that this is our first year of the execution of the five-year plan, and it is under execution. We are moving ahead with the transformation of the bank following these four strategic pillars. For example, and this is just example, this is not taxative, it is just some examples of the things that the bank has deployed across this second quarter of the year. With a pillar of simplicity, for example, we have almost completed the deployment of the new retail banking app. We have unified all onboarding, digital onboarding processes for retail customers. We have launched extended hours to operate through the weekends for commercial customers, and much more on primacy.

We have launched a first-mover loyalty program. We are the first bank using loyalty programs as the ones that airlines or some well-advanced fintechs and digital banks use globally. We are the first bank in Argentina to do this.

This will create a platform for us to move at scale customers from non-primary to primary. We are moving also with a relationship pricing facility to be sure that we price each customer according to their profitability potential, their risk, and their loyalty. We are moving ahead with one of the initiatives of the strategic plan that will help primacy with commercial customers, which is the launch of our acquiring platform. On development, many things here as well. Our wealth management app is live. Insurance was an area that we had underdeveloped in the bank, and we have launched auto insurance across the network, which will be a driver of future fee income growth. We are preparing for the launch of Banco Macro private bank proposition, and are hiring but also preparing our talent with a cutting-edge, innovative wealth private banking academy for our people.

Finally, on digital plus human, another breakthrough of the quarter is that we launched the first conversational banking WhatsApp channel in the industry. 6 million customers can operate with the bank intuitively, using day-to-day language, sending us audios, sending us images, sending us text, in day-to-day language, and our AI agent can respond. No other bank is doing this at this scale in Argentina, so this is also giving us a competitive differentiation, using and making the use of AI in banking in Argentina real.

We continue with the transformation of the physical network, reducing our number of branches, but also modernizing and investing in the- in the wealth centers, in the commercial centers, in what we call hubs. So we are reducing square footage, we are reducing numbers of branches, but at the same time, investing in these customer service centers to service the segments that are most profitable for the bank. So this is basically what is going on.

There is much more under execution. We expect to continue bringing to these calls order by quarter, the progress that we are making on our way to 2030. Of course, there are some variables in the macroeconomic context and the political context that are not in our control. We will continue navigating the situation in this pre-electoral year, but we remain confident of the future of Argentina, and that is why we will continue doing our job in building the bank of the future for a thriving Argentina. Thank you,Nicolás .

Thank you, Juan. This concludes our prepared remarks. At this time, we would like to take the questions you may have. Operator, please open the line for Q&A.

Okay. At this time, we are going to open it up for questions and answers. If you would like to ask a question, please press the Q&A button at the bottom of the screen. Or to ask a question audio, click on Raise Hand. We will then receive a request to activate your microphone. One moment please for the first question. Our first question comes from Yuri Fernandes with JPMorgan.

Hi, all. Good morning and thank you for the opportunity of asking questions. I have a follow-up on asset quality, and thank you for the slide presenting some of the metrics. It is clear that was this model update, right, that drove some adjustments here. But still, there was an ongoing worsening and a drop on your coverage ratio, right. So if you can give us just some outlook on how do you see cost of risk, how do you see NPLs evolving for the H2. And regarding the coverage, if this should be the minimum, because I know Banco Macro still has a good level when we compare to some peers. But the delta narrow now, right, this quarter. So if you can also give us a message regarding the coverage ratio. Thank you.

Hi, Yuri. This is Jorge Scarinci. Thanks for your question. Yes, in terms of asset quality, I think across the board, the second quarter in the Argentine market was about quarter in terms of asset quality deterioration in NPLs. Basically, what we saw at some point is that the deterioration on the consumer portfolio continue maybe at maybe lower pace than the one that we saw in the first quarter. There were some also pickup in the rhythm of deterioration on the company's portfolio. I would say that in terms of NPLs, and I will put that it is very important to make the difference between our own risk customers and the contagion of our own customers with being non-recurrent in other banks or digital wallets here.

It is very important to highlight there the difference between the 4.1 in our own risk and the 6.3 with the contagions there. Also, we posted similar on coverage ratios, both looking at Stage 3, the coverage ratio is almost 149%. That is something that we are cautiously looking at. Of course, it is looking very healthy. In terms of the 95.4 that is coming down from the 109.8% total coverage compared to the previous quarter. That is something that we were questioning because we were the only bank being above the 100% level before. The rest of the system was going downwards. We did the same, but always keeping an eye on the Stage 3 coverage ratio. That is very important for us.

That being said, I would say that for the end of the year, we think that cost of risk that was down in this quarter, compared to the previous one, we are thinking to be between 6.5% and 7% cost of risk by the end of 2026, and NPLs to be ranging between 5.5% and 6%. Those are in terms of NPLs, talking about the total portfolio, not Stage 3. Stage 3, of course, we are looking to be below 4% by far by the end of 2026. In terms of coverage ratio, Yuri, again, for the moment, we are not seeing the total coverage ratio going below 90%. We have to see what is going on in the industry going forward, but that is something that we, that number, we have it as a, not as a barrier, but a kind of a target.

Of course, the important one is the Stage 3 that for sure is going to continue well above the 100% level by the end of the year.

No, super clear, Jorge. Thank you for the numbers. If I may, a second one just on growth. I think last week there was a measure to flexibilize a little bit, again, the dollar lending, right? I think there is a cap on 15% of your deposits. I know Banco Macro, you were already lending in dollars with your own resources. How you see this measure, Jorge? Also the loan outlook. Should we see an acceleration from here? How are you seeing overall? I guess your former guidance of 15%-20% on real growth may be a little bit challenging. I do not know if with this new measure, maybe we can see better dynamism for growth in Argentina. Thank you.

Yes, Yuri. What we are seeing is something that is related to what Juan Parma commented before. We are starting the beginning of the pre-electoral year. Of course, this government has been very precise and making a lot of focus on maintaining inflation under control. What we are seeing is that is have an impact on what we are seeing nowadays in the domestic interest rates that have increased a little bit compared to what happened in the second quarter. That is why our forecast for loan growth is being reduced to level of around 5% in real terms and maybe slightly downwards. This make a range between 2% and 5% in real terms for the whole portfolio. Here we are assuming that the ARS loans will grow until the end of the year in a similar rate than the monthly inflation figure.

In terms of the dollar-denominated loans, we are also assuming that they will grow at a 2%, 2.5% a month. Also we are assuming there is going to be a slight devaluation of the peso between June and December of around 12%, 13%. If you do the maths there, you can get to the level of between 2% and 5% real terms that we are talking to. In relation to the new regulation, new measure that the Central Bank announced, where banks cannot lend up to 15% of US dollar deposits to those companies that are not generating US dollars. We think that is something that will bring some growth to the portfolio. For the moment, we are not expecting a boom or a huge increase in the near term, but this is something that maybe could have more impact in 2027.

We see this measure as a positive for the system and of course, for the country.

No. Super clear. Thank you very much.

You are welcome.

Our next question comes from Juliana Ohara with Goldman Sachs.

Hi, everyone. Good morning, and thank you for taking my questions. I just have two follow-ups. One is on your asset quality. I was wondering if you could share some more color on how your write-offs and your recovery trends are going, and how you expect it to trend going forward. The second one is on loan growth. Next year, you have an election year, and I think loan growth this year should be a little bit more muted than we expected. How do you think, and if you could share already some broad expectations for loan growth next year, would be super great. Thank you.

Hi, Juliana. In terms of your first question, write-off policy is when the debtor or the client reach Category 5, and it is a provision 100%, we do a write-off there. That is something that we have been carrying out this policy for many years, and we continue with the same one, and that is going to be the policy going forward. In terms of recoveries, for the moment, we are seeing some little recoveries on the loans that have been write-off or written off, sorry. We think that recoveries are going to be slightly bigger in 2027, when we think that the cycle is going to enter into a more positive phase. In terms of your second question, honestly, I think it is a bit early to make a guidance for loan growth for 2027.

Honestly, we would like to see how we finish 2026, but also the macroeconomic variables in 2027. For the moment, we are having very preliminary guidance from the economies that we work with. Just give me at least one more quarter to give the 2027 guidance for loan growth.

Our next question comes from Ernesto Gabilondo with Bank of America.

Thank you. Hi, good morning, Juan, Jorge, and Nicolás. Thanks for the opportunity to ask questions. My first question will be on the political side. We have started to see some kind of surveys or initial polls ahead of the presidential election. I think it is too soon, but we are starting to see them. Can you provide us, what are you seeing on your side? How is the business sentiment? How is the consumer confidence ahead of the election? For my second question is on your earnings expectations and ROE evolution throughout the rest of the year. Your recurring ROE, your adjusted ROE is already at the double digit. How should we think about the evolution of this ROE that in the second quarter, the adjusted one was at 14%? How should we think for the H2 and for the full year? Thank you.

Maybe I can take the first question on the political side. As you can imagine, we try to avoid making forward-looking statements or predictions in terms of politics. Having said that, it is clear, as Jorge mentioned, that this is a pre-electoral year, and that as the election year approaches, unless there is a super clear winner coming through the polls, that creates a bit more chances of volatility. The Central Bank has been preparing for that from a fiscal standpoint, from an FX standpoint, from an FX reserve standpoint, which I think is welcome, preparing for what will likely happen, which is that we will see some more volatility. However, I must say that comparing this pre-electoral year with other pre-electoral years in the past, the good sign is that US dollar deposits remain at record highs, which is a good sense of confidence from the public.

But it's what it is. It's a pre-electoral year, and we will have some more volatility as usual. But again, that said, we believe that the government is preparing well for that, and much better than in previous years.

Thanks, Juan. Ernesto, in terms of ROE, yes, we are increasing our ROE for 2026. The previous level for the adjusted ROE was in the area of 8%. Now we are moving up this guidance to the area of 12% for the average for 2026. Basically, there was a good H1 in terms of margins. Margins remain much better than expected. We believe that going forward, it will maintain the strength, so that's where we are increasing the ROE or the adjusted ROE target from 8% to area of 12%.

Perfect. That was super helpful. Thank you very much, Juan and Jorge.

You're welcome.

Welcome.

Our next question comes from Brian Flores with Citi.

Hi, team. Good morning. Thank you for the opportunity. I wanted to ask you two things. The first one is looking at your 2030 strategic plan. Just wanted to check which levers should drive the ROE to your midterm target. First, obviously, if you can disclose it, where do you see the bank in terms of real ROE? Then what could drive it? I am asking this because, as Jorge was mentioning, it seems that NIMs should structurally come down, right? Maybe to be compensated with higher volumes. You are running at an efficiency ratio that seems historically good for you. But also you will need to be investing into this new, I would say, customer acquisition strategies, right?

Just wanted to check, in your view, what levels of ROE are you looking in a sustainable basis? Then what are the key levers that will get you there? My second question is more of a sentiment one, and maybe this is something that we on the sales side, we are scratching our heads with, and maybe you obviously, you can help us here. Maybe we can scratch our heads together. But we are wondering here, you are revising upwards ROE, and I think the industry as a whole is turning around in terms of unit economics. However, valuation seems to be coming down in a very, I would say, sharp way, right? Clearly, the market is worried about something.

Just wanted to check with you, in your view, if it could be the level of growth that, as you were mentioning in your own guidance, is coming down and maybe the perspectives have shifted. Or do you think maybe on the political side, as Ernesto was saying, in terms of big uncertainties in 2027 and forward, right? I know it is a tough question, but any insights here, I think it is great. Thank you.

Hi, Brian. Let's start with the last part, with the last question in terms of the ROE and the valuations. Of course, our view from a corporate perspective, we're increasing ROE from the 8% adjusted level that we mentioned before to the area of 12%. It is pretty clear that the H1 was much better than what we had expected, and we think that the trend at some point will be maintained in the coming two quarters. I agree with you that valuations or stock prices, not only for the banking sector, but for the whole Argentina universe, are down when you look at on a year-to-date basis. I think that is basically of, at some point, not only, let's say, local risk, but at some point, I think that the international scenario is becoming a bit more scary, let's put it in that way.

When you look at U.S. 10-year or 30-year interest rates, they are up. When you look at the U.S. fiscal deficit, this is huge. The amount of the debt is very high. At some point, I think that investors are trying to move into a more safety assets. You are seeing now gold prices are going up. I think that at some point, it's not only local risk. I think that the world's markets are a bit volatile and try to find the best place to allocate assets. It's related to that according to our view. In terms of the first part of your question, in terms of your 2030 strategy, I will let Juan to comment on that.

Yeah, sure. I would add to the previous comments that Jorge made on valuations, that adding to the global turmoil, it's also the fact, as we mentioned before, that we are navigating a pre-electoral year. Part of what we are seeing in the valuations, not only of banks, but in general of Argentinian assets, has to do with that. We don't see this as a long-term concern, but something that should be cleared out once we pass next year elections and the political outlook becomes more clear for the next four-year term. In terms of the levers to achieve long-term ROE, you're right.

If we believe that the central scenario is one where Argentina continues its stabilization process, and inflation continues going down, and rates continue going down, there will be a trade-off with, on one hand, margins continue compressing, and on the other hand, the financial system expanding, where volumes should long-term more than compensate for the reduction in margins. But short-term is the opposite. Typically, margins compress before the volume comes. That's the transition that we see for the next five years in Argentina in this central scenario. Margins compressing as inflation rates go down, and volumes, as we harvest the opportunity of moving loans to GDP, which today stand at 11%, to regional averages of 30, 40, 50%. That's the macro context for the industry.

In our case, the levers are capturing that growth and above, so growing market share, growing volumes, growing scale, but also harvesting that from not only acquiring new customers but also moving primary customers up. Today, primary customers are 30%. We expect to end our strategic planning period with 50%, and that's a significant driver of profitability, efficiency, and market share. The other lever is fee income, which is really important. As Argentina starts reducing poverty and increasing its middle class and its affluent class, capturing fee revenue from insurance, from wealth management will be crucial, and that's not subject to margin compression. That's why you saw us talking about development, about insurance, about wealth management, about private banking, and everything that we are planting to be prepared to lead in harvesting that opportunity. Third lever is efficiency.

You mentioned how we will fund our investments in these growth areas while maintaining our efficiency. The good news is that we still have a big physical network. We still have opportunities to recycle costs from non-productive cost to more value-adding investments. That's what we've been doing. This is not just the plan. This is real. As Jorge mentioned, we've been reducing significantly our branches network and our FTE, and that's what we're using to fund growth initiatives while keeping our efficiency ratio in good levels.

No, super clear, Jorge and Juan. If I may just follow up on the level that you envision in 2030 as the sustainable levels of ROE, do you have a specific target in mind?

Yes. Going forward, and of course, sustainable implies, with Argentina inflation going into single digits at some point. If we continue like this, we assume that in 2028, Argentina will leave aside the inflation accounting. The ROE reported in 2030 should be nominal. So we are expecting to be in the area of about 20% ROE by 2030.

Super clear. Thank you.

You're welcome.

Our next question comes from Pedro Leduc with Itaú BBA.

Hello, everybody. Thank you for the call, and thank you my question. Can we explore a little bit more that part? I know it will come out to efficiency, but you've been doing a lot of changes in the footprint, but also modernizing the tech and consumer-facing stack. I'm trying to square it out when I'm modeling it forward as well. Thinking less about efficiency, because top line moves a lot, but more on maybe on real terms, just to see where we are with the balance of savings and investments that you're doing. Thank you.

Hi, Pedro. Yes, as Juan was commenting before, the idea in terms of branches, by the end of the year, we should be in the area of 370 houses and employees below 8,000 employees. At the same time, of course, as Juan was also commenting, we are investing in technology, in different sectors of the bank in order to modernize systems and so on. I would say that going forward, we are going to see, nominally speaking, maybe similar levels of expenses. In the middle, you will have, of course, a decline in remunerations of employees because we are going to have less employees. We are going to see increase in software expenses. But of course, going forward, the idea is to dilute this nominal level of expenses within a higher volume of net interest and fee income.

The idea going forward is to work there in both sides of the equation, expenses, and the generation of interest and fee income.

That's useful. Thank you.

You're welcome.

Our next question comes from Mario Estrella with Itaú.

Hey, guys. Good morning. Just one question on margins. What we saw is that funding costs actually went down, but all of that was offset by lower asset yields. What we've seen at the beginning of the third quarter is that a little bit more volatility in the local rates. I was wondering if the evolution of the margins for the rest of the year can be a little bit more challenging given that cost of fund can reverse. At the same time, that asset yields keep on having the pressure that we saw in the second quarter. What's the danger here for the evolution of margin in the remainder of the year and for the guidance, for that matter?

Hi, Mario. I commented this before. I think that the net interest margins that we saw in the H1 of the year were slightly wider than the one that we had expected. We believe that going forward, this level of margins would be maintained. At the beginning of the year, we were expecting to have a net interest margin in the area of 20% as a guidance. Now, after the H1, I will have to say that we should be above the 20% net interest margin guidance. The idea is to relatively maintain the margins in the couple of the next quarters.

Okay. That's perfect. Just to confirm what you mentioned about loan growth. The guidance, I believe it was between 15% and 20%. Do you maintain that guidance or-

Mario, that guidance was two quarters ago. Now the new one is between 2% and 5% in real terms, and I explained the evolution of the peso and dollar loans before.

Yeah. That was pretty clear. I was trying to confirm that. Okay. Thank you.

You're welcome, Mario.

Our next question comes from Camila Azevedo with UBS.

Hi, everyone. Thanks for taking my question. I have two questions from my end, two follow-ups. First on growth. I just wanted to get your sense on recent performance of the last month and starting August. Also, in the second quarter by economic sector or customer segments, and which would be the main drivers behind growth that you are mainly expected by sector as well. Also, how are you seeing retail demand currently? In terms of demand, I just wanted. Yes. That's another follow-up in terms of we are seeing the higher spreads, right? Given these higher spreads, how are you seeing demand and how should we expect demand to evolve in the H2 of this year? Thank you.

Hi, Camila. In terms of growth, what we are seeing, or what we will be seeing in the two coming quarters is that commercial lending should be outpacing consumer lending. At some point, the consumer growth is slightly below inflation, and commercial lending is below inflation levels, monthly speaking. We expect that this will continue at least in the next two quarters. The sectors, what we're seeing demand are the ones that are the winners within this economic model, which are basically mining, oil, gas, agribusiness. We expect to see some pickup maybe in construction, in the next couple of quarters. We assume that massive consumption sectors, automobile, are kind of the losers within this economic model, so we are not seeing big demand coming from them. That is the idea.

Within your highlight on the margins, I think that's something to keep an eye on also is that when you look at the NIM, we are including interest rates there, but also income coming from the bond portfolio and on effects. At some point, if you want to dig in that number, you will see at some point that intermediation rates should narrow a little bit. On the other hand, you will have income from bond and on effects compensating that decline on the intermediation spread. That's why we are forecasting some stability in the NIM.

Yeah. That's super clear. Thank you very much.

Welcome.

Our next question comes from Pedro Offenhenden with Latin Securities.

Hello, Juan, Jorge, Nicolás. Thank you for taking the call. I wanted to ask, when you look at the NPLs and loan trends, are you seeing any meaningful difference in credit behavior between the interior of the country and the city or province of Buenos Aires, either in term of credit demand or delinquency trends?

Hi, Pedro. Because our footprint is more in interior and less exposure in BA, I think that is important to look at those banks with more presence in BA to see the trend. I think that's when you look into our numbers and when you look at our own risk, that is the Stage 3, they are behaving much better than what we could be seeing in terms of the BA clients. I would say that this is not only a geographic reason, but also is because Banco Macro on its own has a more, let's say, cautious, strict, deep insight on the credit policy. So that is also helping, not only the geographic location of the customers.

Okay. Thank you, Jorge.

You are welcome.

The next question comes from Federico Cabelli with AdCap.

Hello, everyone. Thanks for taking my question. I want to ask regarding your restructuring plan, if we should expect these expenses to continue in the H2 of the year and in 2027. You guided ROEs in 12% for the year, how these expenses will impact ROE and what is your reported ROE guidance for the year?

Hi, Federico. Yes, the restructuring will continue as we were commenting before, in order of closing additional branches and some reduction on FTEs. What we are going to see along 2026, you will see, of course, the impact on those cost of layoffs. Of course, in 2027, we are going to see all the savings on this less FTE number and lower number of branches. Including the adjusted ROE, that we forecast of 12% area that we were commenting, I would say that the reported ROE should be ranging in the area of between 9% and 10% approach. But again, we look at the adjusted because it is allowing us to see the impact on, let us say, the clean P&L without the one-time charges.

Okay. Thank you very much.

Welcome.

The next question comes from Tito Labarta with Goldman Sachs.

Hi. Good morning, Jorge, Juan, and Nicolás. Thanks for the call taking my questions. Just to follow up a little bit, just to understand, how do you see the health of the consumer, right? Because, we are still seeing NPLs rising. There is a bit of a recovery, but unemployment is still somewhat high. Just on the capacity for consumers to repay these loans, are you just writing off these loans? Are you able to work with some of these consumers? Just to think about your ability to accelerate consumer loan growth, maybe going into next year, just given where the economy is and where the health of the consumer is. If you can, any color on that would be very helpful. Thank you.

Hi, Tito. How are you? I think that the consumption sentiment for the moment is a bit sluggish. We think that going forward, if we see inflation cooling down, that will be the main driver to see the real wages recovery, and at some point, we could see in 2027 some recovery on consumption demand. For the rest of the year, again, we are seeing these loans maybe growing in similar levels than inflation. We are not seeing that pickup in 2026, at least on these consumer loans.

The only thing that I would add, Jorge, and Tito, to your question, is that even in this context, until real wages start to improve and lending capacity from consumers starts to increase, what we are doing internally is recycling our portfolio with better quality, even in this more, if you wish, restrictive scenario for consumers. For personal loans, for example, 50% of the portfolio is already originated from vintages from around May last year forward, which is when we introduced the first restrictions in our credit policy and became more stringent. My point is, the improvement in NPLs at this point not only depends on the external macroeconomic conditions to improve, but also depends on our own actions.

That's why we are confident, as Jorge explained before, that we are stabilizing the NPLs when we see the month-over-month performance from May to June and already June to July, and that will continue going forward because we already are seeing these new vintages with much better quality starting to impact the books. That is separate or irrespective of potential improvements in consumer purchasing power from real salaries recovery.

Okay, that's perfect. Thank you very much.

Welcome, Tito.

The next question comes from Lisandro Lloveras with one618. Sir, you can open a microphone.

Yes. Can you hear me?

Yes.

Congratulations on the results. We saw a 1% decrease in deposits and a sharply lowering loan guidance. Can you provide a printer regarding deposits guidance for the full year? Is it updated? Thanks.

Hi, Lisandro. Yes, I think we are also reducing a little bit the deposit growth for the year to put it in the 10% real area. Basically, again, we are seeing maybe peso deposits not growing or similar levels than inflation. On the other hand, we are seeing dollar deposits maybe peaking or moving upwards slightly above the rhythm of the peso-denominated deposits.

Okay, perfect. Thanks.

Welcome.

The next question comes from Ignacio Sniechowski with Invertir en Bolsa.

Hi. Good evening. Thank you for taking my questions. The first question is regarding Stage 3 loans, asset quality particular. Do you have some kind of system-wide figures to compare that 4.1 that you reported in the second quarter? The next question is regarding the excess capital and these probably long-term attractive valuation that banks are trading. Do you see any potential acquisition at this moment or in the following month? Thank you very much.

Hi, Ignacio. How are you? We do not have many comparisons on the Stage 3 in the system. We are trying to find out all the data that we can use to compare our 4.1. We assume that we are on the top banks on this ratio. But honestly, we don't have a market comparison tool for the Stage 3. In terms of your second question, yeah, the excess capital that we have, this is something that we constantly mention that is going to be used not only for M&A, but also for organic growth. In terms of M&A, we are always looking at the markets, and there are always opportunities. Of course, not all those opportunities are suitable for Banco Macro's growth and return appetites. We analyze all what we can.

The idea is to continue, of course, we think that the consolidation process in the banking sector in Argentina is not finished. Going forward, something would happen, of course, we'll be on alert there. That's our vision in terms of the target for the excess capital.

Okay. Thank you very much.

The next question comes from Carlos Gómez with HSBC. Could you explain the reasons for the increase in risk-weighted assets in the quarter, in particular in operational risks? Is your methodology now different from those of the other banks? Under the new models, what is the level of capital you consider adequate, and how much surplus that you can invest or return to shareholders? The other question from him is, how much longer do you expect to continue your restructuring program? Is your footprint of 400 base sheets now adequate? Thank you.

In terms of the first question, there was a new methodology that we implemented in terms of operational risk, that's basically impacted on the level of the excess capital, even though that the 28% ratio of Tier 1 is the highest among Argentine banks. $2.7 billion of excess capital is very wide. The idea is to make the best use of that excess capital going forward. In terms of the second question, we should be going slightly below the 400 branches, as I mentioned before, in the area of 370 by the end of 2026.

Next question comes from Agustina Isidro with BBVA AM. Which is the loans book breakdown in terms of interest and rates fixed versus floating and materially?

Yes, Agustina. You will have all that information in the balance sheet that we publish to the CNV and the stock exchange. There is a very detailed breakdown on all that information.

The next question comes from Arthur Brynes with Deltec. Do you sense the Argentinians feeling more comfortable holding pesos?

For the moment, I think that pesos are being used for transactional purposes. US dollars are used for savings. Of course, if we continue in this trend of reducing the inflation of the country, and of course, maintaining a fiscal surplus and working on institutionality and more developed growth measures, little by little, Argentinians are going to incline and hold more pesos. That is what we are seeing for the moment.

The next question comes from a private investor, called Stefan Zwinger. How do you see the further development of your commercial leading as you showed some pickup in the current quarter? Also, if you may, do you plan to deploy some capital for share buybacks, as the share price has suffered lately and is getting close to a level where you did some buybacks in last October? Thanks.

Well, according to the first part of your question, yes. As we mentioned before, we are seeing the commercial portfolio performing slightly better than the consumer portfolio for the coming two quarters. In terms of the second part of the question, always share buyback programs are on the table. It is something that the board of directors analyze depending on market conditions. That is something that we have used in the past. Again, it is always on the table. It is the board of directors' decision when to implement it.

The next question comes from Adriano Mariani with Sagil Capital LLP. "Hola, Jorge. Can you touch quickly on the capital consumption during the quarter? Obviously, 28% is still very high, but interesting how that feels so much with lackluster growth, even after dividends impact.

Yes. Hi, Adriano. We explained that the consumption was because we implemented a new methodology in terms of operational risk, and that slightly impacted on the ratio that was down from 32%-28%. Again, it is the highest among Argentinian banks. The excess capital is the widest, and the idea is to continue as far as we can, paying cash dividends on a yearly basis and using that for organic and inorganic growth.

There are no more questions at this time. This concludes the questions and answer section. I will now turn over to Mr. Nicolás Torres for final considerations.

Thank you, Juan Jorge, and thank you all for your interest in Banco Macro and for joining us today. We appreciate your time and your questions. We look forward to speaking with you again. Have a good day.

This concludes today's presentation. You may now disconnect.

Good morning, ladies and gentlemen, and thank you for waiting. At this time, we would like to welcome everyone to Banco Macro's first quarter 2026 earnings conference call. We would like to inform you that the first quarter 2026 press release is available to download at the investor relations website of Banco Macro, www.macro.com.ar/relaciones-inversores. Also, this event is being recorded, and all participants will be in a listen-only mode during the company's presentation. After the company's remarks are completed, there'll be a question and answer session. At that time, further instructions will be given. It is now my pleasure to introduce our speakers. Joining us from Argentina are Mr. Jorge Scarinci and Chief Financial Officer, and Mr. Nicolás Torres, IR. Now I will turn the conference over to Mr. Nicolás Torres. You may begin your conference.

Good morning, and welcome to Banco Macro's first quarter 2026 conference call. Any comment we may make today may include forward-looking statements which are subject to various conditions, and these are outlined in our 20-F, which was filed to the SEC and is available at our website. First quarter 2026 press release was distributed yesterday, and it's available at our website. All figures are in ARS and have been restated in terms of the measuring unit current at the end of the reporting period. As of 2020, the bank began reporting results applying hyperinflation accounting in accordance with IFRS, IAS 29, as established by the Central Bank. For ease of comparison, figures of previous quarters have been restated applying IAS 29 to reflect the accumulated effect of the inflation adjustment for each period to March 31st, 2026. I will now briefly comment on the bank's first quarter 2026 financial results.

Banco Macro's net income totaled ARS 139.8 billion in the first quarter of 2026, 28% or ARS 30.2 billion higher than the sum posted in the previous quarter and 131% or ARS 39.2 billion higher than a year ago. In the first quarter of 2026, the annualized return on average equity and the annualized return on average assets were 10% and 2.4% respectively. Excluding restructuring expenses, ARS 4.9 billion after tax, the first quarter 2026 net income would have totaled ARS 152.9 billion, and the annualized ROE and ROA would have been 10.9 and 2.6% respectively. In the first quarter of 2026, operating income before general and administrative and personnel expenses totaled ARS 1.23 trillion, 3% or ARS 43.6 billion lower than the fourth quarter of 2025 and 16% or ARS 169.2 billion higher than the same period of last year.

In the first quarter of 2026, operating income after general, administrative and personnel expenses was ARS 569.8 billion and 15% or ARS 73.8 billion higher than the fourth quarter of 2025 and 24% or ARS 108.6 billion higher than a year ago. The bank's first quarter 2026 net interest income totaled ARS 975.2 billion, 7% or ARS 59.7 billion higher than the fourth quarter of 2025, and 27% or ARS 207.2 billion higher year-on-year. This result is due to a 5% decrease in interest income and a 21% decrease in interest expense. In the first quarter of 2026, interest on loans represented 72% of total interest income. In the first quarter of 2026, the bank's strategy to remain short in US dollars proved successful.

The combination of the short dollar position together with the long futures position and the allocation of the ARS generated by the said sale of US dollars resulted in a net gain. The bank's first quarter 2026 interest expense totaled ARS 485.7 billion, decreasing 21% or ARS 132.7 billion compared to the previous quarter, and 27% or ARS 104 billion higher compared to the first quarter of 2025. In the first quarter of 2026, interest on deposits represented 93% of the bank's total interest expense, decreasing 22% or ARS 129.1 billion quarter on quarter due to a 470 basis point decrease in the average rate paid on deposits, while the average loan price of deposits increased 1%. On a yearly basis, interest on deposits increased 24% or ARS 87.1 billion.

In the first quarter of 2026, the bank's net interest margin, including FX, was 25.3%, higher than the 21.7% posted in the fourth quarter of 2025 and the 23.2% posted in the first quarter of 2020. The first quarter of 2026, Banco Macro's administrative expenses plus employee benefits totaled ARS 349.8 billion, 22% or ARS 101.5 billion lower than the previous quarter due to lower employee benefits, which decreased 28%, and lower administrative expenses, which decreased 9%. On a yearly basis, administrative expenses plus employee benefits increased 3% or ARS 9 billion. Employee benefits decreased 28% or ARS 89.6 billion quarter on quarter. Compensation and bonuses decreased 61% or ARS 74.8 billion. In the first quarter of 2026, the bank recorded ARS 19.9 billion restructuring expenses related to early retirement plans and severance payment provisions.

On a yearly basis, employee benefits increased 3% or ARS 6 billion, and excluding the restructuring expenses, employee benefits would have decreased 8% or ARS 18.7 billion quarter-on-quarter and 6% or ARS 13.9 billion year-on-year. It is worth mentioning that in the first quarter of 2026, Banco Macro reduced its branch network by 24 branches down to 420 from 444 in December of 2025 and reduced its headcount by 3%. In the first quarter of 2026, the result from the net monetary position totaled ARS 349.8 billion loss, 15% or ARS 46 billion higher than the loss posted in the fourth quarter of 2025, and 1% or ARS 4.4 billion lower than the loss posted one year ago. Higher inflation was observed during the quarter, 158 basis points above the fourth quarter of 2025.

Inflation was 9.44% in the first quarter of 2026, compared to 7.86% in the fourth quarter of 2025. In the first quarter of 2026, Banco Macro's effective income tax rate was 34.3%. In the first quarter of 2025 to 2026, Banco Macro's total financing decreased 9% or ARS 1.1 trillion quarter-on-quarter, totaling ARS 10.63 trillion, and increased 5% or ARS 458.9 billion year-on-year. In the first quarter of 2026, ARS financing decreased 9%, while U.S. dollar financing decreased 6%. It is important to mention that Banco Macro's market share over private sector loans as of March 2026, reached 8.2%, decreasing 40 basis points compared to December of 2025.

On the funding side, Banco Macro's total deposits decreased 7% or ARS 993.7 billion quarter-on-quarter, and increased 10% or ARS 1.22 trillion year-on-year, totaling ARS 13.99 trillion and representing 76% of the bank's total liabilities. Private sector deposits decreased 8% or ARS 1.1 trillion quarter-on-quarter. In the first quarter of 2026, peso deposits decreased 4%, while US dollar deposits decreased 7%. Banco Macro's market share over private sector deposits as of March 2026 total 7.9% unchanged from the previous quarter. In terms of asset quality, Banco Macro's non-performing total financial ratio reached 5.4%. It is worth mentioning that Banco Macro's non-performing total financial ratio under expected credit losses, Stage 3, plus 90 days past due loans deteriorated 84 basis points during the first quarter of 2026, totaling 3.64% versus 2.8% in the fourth quarter of 2025.

The final non-performing ratio is affected by mandatory classification of customers under central bank rules, taking into consideration customers' behavior across the financial system. Banco Macro's non-performing total financial ratio, excluding mandatory classification of customers, increased 109 basis points, reaching 4.73% in the first quarter of 2026 versus 3.64% in the fourth quarter of 2025. Consumer portfolio non-performing loans deteriorated 168 basis points up to 6.92% from 5.3% in the fourth quarter of 2025. While commercial portfolio non-performing loans deteriorated 66 basis points in the first quarter of 2026, up to 134% from 0.68% in the fourth quarter of 2025. The coverage ratio, measured as total allowance under credit losses over non-performing loans under central bank rules, reached 109.79% in the first quarter of 2026.

Had the coverage ratio been 90%, which is similar to the coverage ratio of other private banks in Argentina, net income in the first quarter of 2026 would have totaled ARS 219.7 billion, representing an adjusted ROE of 15.7%. Banco Macro continued showing a strong solvency ratio with an excess capital of ARS 4 trillion, 32.4% capital adequacy ratio and 32.4% Tier 1 ratio. The bank's liquid assets remain at an adequate level, reaching 78% of its total deposits in the first quarter of 2026. The bank seems to make the best use of this excess capital. We have accounted for another positive quarter. We continue showing a solid financial position. Asset quality remain under control and closing model. We keep on working to improve more our efficiency standards, and we keep a well-atomized deposit base.

At this time, we would like to take the questions you may have.

Okay. At this time, we are going to open it up for questions and answers. If you would like to ask a question, please press the Q&A button at the bottom of the screen, or to ask questions on audio, click on Raise Hand. You will receive a request to activate your microphone. Our first question comes from Brian Flores with Citi.

Hi, team. Good morning, and thank you for the opportunity to ask question. The first one is the usual one we have. If you have any revision on guidance, we know some of your peers have revised growth a bit in both loans and deposits. Just checking with you if the previous ranges you provided are still valid. I wanted to maybe do a double click on asset quality. We saw still obviously some NPL deterioration, and we know you kept the coverage ratio at healthy levels. I just wanted to check with you if, going forward or you're already seeing better trends in terms of provision and customer behavior. Thank you.

Hi, Brian. This is Jorge Scarinci. On your first question about guidance in terms of growth, loans or deposits, for the moment, we are maintaining the guidance that we gave last quarter. What we are seeing basically is that the first quarter, when you look at growth in loans, there was a decline. There was an increase in real times when you compare that on a yearly basis. Something to mention here is when you have a look at advances, sorry, overdraft, that is one of the components of our loans. This line is usually used as a way of allocating excess liquidity. As of March 2026, the market share in this line was 14.6%, well below the 18.1% market share that we posted one year ago. This is quite affecting and that's why the 5% growth on annual basis.

However, when you have a look at other lines like pledges, personal loans, discounted documents or mortgages, they are growing above 20% on a yearly basis. Because of this, and also.

Because of what we've seen in April, credit demand, both in ARS and in USD, and what is going on in May, that we are seeing a recovery in loan demand. That's why that we are maintaining our guidance for loans. Similar trend with the deposits. We are maintaining the guidance on the deposits, even though on a quarterly basis, there was a decrease. We are seeing some upward trend in the current quarter onwards. In terms of your second question, asset quality, I think that is worth mentioning here that even though there was a deterioration that we've seen in the whole portfolio that reached 5.4%, we are still showing the best NPL, so total loan ratio among our peers. Also when you look at the coverage ratio, that is almost 110%, this is also a ratio that we are showing the highest among our peers.

We commented in the press release that if we would be going down to a level of 90% of coverage, and that is the average of our peers, the adjusted ROE for the quarter, of course, annualized, would have been 15.7%. It is also worth mentioning that what we saw between February and March, and also between March and April, there was a positive behavior on the consumer Stage 3 trend. So what we saw is that February apparently was a kind of a peak for the Stage 3 consumer, and having March and April showing better trends or positive trends there. Also we saw in terms of commercial, that the deterioration speed was slowed down in both months.

Going forward, we are also maintaining our cost of risk guidance, and we believe that we are close to the peak on this deterioration of asset quality trend that we have seen in the last 12 months. That's it, Brian.

Perfect. 5.2 or approximately 5.2 cost of risk, real ROE close to 8%, right? Just confirming with you.

Yeah. I was talking about guidelines for growth in terms of loans and deposits and also in terms of asset quality. Cost of risk, yes, it's going to be, I think, more than between five and a half and six. In terms of profitability, it is pretty clear that we posted, I would say, the best quarter among Argentine banks, and it was slightly above the annualized ROE guidance that we gave last quarter. Because of what we are seeing in terms of growth in this second quarter should be another good quarter for the bank. For the moment, I think that we are going to be maintaining the ROE guidance of area 80% on the adjusted ROE, that is without the non-recurring items that we are showing in the quarter. We would like to wait another quarter to see if we are going to increase our ROE guidance.

For the moment, ROE guidance is the same 80% area for the adjusted ROE.

Super clear. Thank you, Jorge.

Welcome, Brian.

Our next question comes from Tito Labarta with Goldman Sachs.

Hi, good morning, Jorge and Nicolás. Thanks for the call and taking my question. I guess following up on the ROE guidance in particular, more if we look at the trends, right, of cost of risk is likely to come down as asset quality maybe stabilizes. You had some good NIM performance in the quarter, mainly due on lower funding costs. Do you expect that to revert where NIM should come down for the rest of the year? Can you sustain this level of NIM, which would then imply perhaps upside risk to that ROE guidance? Just maybe thinking how the NIM should evolve from here and impact profitability. Thank you.

Hi, Tito. In terms of NIMs, we are seeing going forward, I think a small contraction. I would say that the NIM for the first Q was slightly above the one that we were expecting. I would say that the average of the year should be quite similar than the average of last year. I think that is one of the reasons that could be, at some point, compensating the level of maintaining the same cost of risk going forward. That's why we are maintaining this ROE guidance. Again, we want to be here a bit conservative and wait one more quarter to see or to crystallize if the bottom line is performing better than expected.

Okay. No, that's clear, Jorge. Thanks for that. Maybe just to follow up there. The pressure on NIM, would it come because you expect Funding costs to go up, or you think there'll be some pressure on the asset yields as rates have come down, also because you're growing loans faster than deposits? Could that also put some pressure on NIM, just to understand where the NIM pressure could come from? Thank you.

Yeah. What we are seeing is that inflation levels should be going slightly down on a monthly basis going forward. That is going to bring nominal interest rates slightly down. I would say that we could be seeing slightly more pressure from assets yields compared to the funding cost that is also going to go down, but a bit more pressure on the asset side.

Okay. That's clear. Thank you, Jorge.

Our next question comes from Ernesto Gabilondo with Bank of America.

Hi. Good morning, Juan, Jorge, and Nicolas. Congrats in your results, and thanks for the opportunity to ask questions. My first question will be a follow-up on Brian's questions on asset quality. You mentioned in the press release you made a recalibration of your model based on the behavior of the customers of the system, and that this was required by the Central Bank of Argentina. In Mexico, we follow a similar practice. In the first quarter, the Mexican banks also created higher provisions based on expected losses of the system, and they were considering the asset quality deterioration of the fintechs. Having said that, I asked to your peers in your conference calls if this practice is followed in Argentina, and they say no. It came to my surprise that you were the only one implementing it during the quarter.

Can you elaborate on why are you implementing it and the other banks don't, and especially as it was required by the regulator. Also, you are the only bank with an adequate reserve coverage ratio above 100%. The others don't. I also just want to understand if you are conservative in your ratio or you are just following the international standards. Thank you.

Ernesto, this is Juan. Thanks for your question. Let me take this one. As you saw in the release, we are quoting three metrics of delinquency. 5.4, 4.7, and 3.6. Okay? 5.4 is the more acid one, which includes the loans that are delinquent with us, plus the loans with us that are not delinquent, plus delinquencies outside Banco Macro. That's the most acid one. Is the one that Central Bank uses for reporting. There's the second indicator, 4.7, which is the loans that are delinquent with us, plus the loans that are current with us on the same customer. Basically, what you do is you include in your delinquency ratio assets that are current in your books, but that are attracted by assets with the same customer that are delinquent. Stage 3 is the methodology that we use for provisioning.

The cost of credit that you see in our results is driven by the Stage 3 delinquency calculation. That Stage 3 delinquency calculation is driven by our model, which is in alignment with accounting standards and includes actual delinquencies, plus indicators of risk of some loans that might be current but are higher risk, for example, because of its score range. Okay. That's the three distinctions. It's important to define that our cost of credit, the provisions that we book in our results, is driven by the Stage 3 calculation. In our case, for the first quarter 2026, 3.64%. In that metric is where Jorge mentioned that for the consumer book in Stage 3 metric, we've seen from February to March and from March to April, two consequent months of reduction.

We have not seen yet reduction on the commercial book in this stage 3 metric, but we have seen a slowdown in the speed of deterioration. Have I made a complex topic clear, Ernesto?

No. Super careful. Just wanted to understand that in these plus indicators of risk, you are being more conservative than the other banks, or it's just that your loan mix is showing you to recognize higher provisioning? Just wanted to understand this.

Yeah. Sorry, we missed that second part of your question. Bottom line, the short answer is yes, we are being more conservative. This does not, in our view, have to do with the outlook. It has to do with how conservative we are in our coverage. That conservatism is reflected in two ways. One is the model itself. Each bank has its own model. The model needs to comply with standards, but it might vary. That's one thing, the model itself. The second one is the recalibration. The recalibration is something that, by regulation, banks need to do at least once a year. What you do when you recalibrate is see the last 12 months and recalculate the probabilities of defaults.

When you are in an upward cycle of delinquency, every time you recalibrate and you take a look to the last 12 months instead of the last previous 12 months, naturally, the probability of default for each of the clusters of the model increases. What we've done is, because the regulation says that you need to recalibrate at least once a year, but you are free to recalibrate if you want every month. We have been more conservative and done more frequent recalibrations to keep our coverage adequate, because if not, what happens is, by the end of the year, if you don't do the recalibration early on, if you are in an upward cycle of delinquency, you may have a hit. Bottom line, again, we are being more conservative, both on the model design itself, but also on the periodicity of recalibration versus our peers.

The difference is significant. As you've seen, the average of our peers is in the 90%, and we are almost 110. Naturally, we should expect to, as delinquency reduces, to reduce the coverage as the recalibration starts reflecting those improvements. That's how we see it, Ernesto. Is that clear?

Yes, very clear. Thank you so much. I just have also a follow-up. Just if you can repeat your guidance for loan growth and deposit growth for this year. I know that you are not changing it, but just to double-check how was it before. Also another question in terms of your OpEx growth. Can you also remind us how should we think about the recurring OpEx growth for this year, excluding the restructuring costs? My last question is on your earnings expectations and ROE evolution throughout the year. I know you are right now at 11% and that you mentioned that you will wait for the second quarter to see if you can improve your guidance. How should we think about the seasonality of the ROE? The second quarter should be a little bit lower and then should be trending up.

Just wanted to understand how should we think about the earnings and the ROE evolution throughout the year to meet your guidance?

Ernesto, in terms of the guidance for growth, we are still maintaining the loan growth guidance of 42% nominal growth for the year and 34% nominal growth in deposits for the year. That is the guidance that we are maintaining in terms of growth.

Sorry, in real terms?

It depends the inflation that you have in your model, but we have an inflation level of 28%.

Perfect.

Second question, in terms of expenses going forward, it is pretty clear, and we have explicitly commented before that we are in a process of making the bank more efficient, even though we were showing excellent efficiency levels. We are in the process of becoming more efficient. Honestly, the idea is to continue at least second quarter with the mid-parts of the third quarter. It depends on how this evolves, but in the way that we are reducing the number of employees and the number of branches. Of course, we do not have exactly the numbers going forward, but a very important proof is that when you look at expenses on a yearly basis, we are in a negative in real terms.

The idea is to continue going forward in the following quarters to show slightly negative numbers in terms of the evolution of expenses in real terms. If you allow me, Jorge, this is in line also with the guidance we gave by the end of last year, the fourth quarter last year, regarding this matter, that you should continue seeing in our quarterly results restructuring costs and continued reduction in operational costs in real terms. You're seeing it again in the first quarter, and we expect that trend of investing in creating sustainable saves going forward in the next quarters.

Okay, just for me to understand, if we exclude the restructuring costs, should we expect OPEX a little bit declining or relatively flat this year?

If you are excluding this, going forward, the idea is to keep on showing a negative real rate of growth.

Okay, understood. Perfect.

Actually, I'm just quoting the comments in the release, but if you take out the restructuring costs, our recurrent costs would have decreased 6% year-on-year, which Jorge mentioned before. We expect that trend of reduction in real terms of cost, excluding restructuring, to be maintained.

Okay. This could be a little bit messy because also in the fourth quarter of last year, you created some non-restructuring costs now. Just wanted to understand if we should be thinking on a yearly basis about this 6% decrease, or it could be also considering fourth quarter also created some of this.

That is something that we are showing the first quarter, and we might be showing the second quarter to continue reducing expenses in real terms. That's the idea on what Juan was commenting.

Perfect.

To be specific, we do not provide guidance to this granularity level. We provide guidance on volume growth and ROE, trends in terms of guidance, but not specifics at this granularity level. We said that you would continue seeing reductions. You are, and you will.

Perfect. No, thank you so much. Just the last question on the seasonality of the earnings and the ROE.

Yeah. You are asking me to answer more like an analyst than a CFO. Honestly, I think that's your work. You are the specialist here. Going forward, we want to see if the trends that we are seeing the second quarter materialize in another good second quarter in order to have more elements to be more positive and increase ROE guidance. I think that's the seasonality on the ROE. Always, the fourth quarter is the good one, and it will depends on many macroeconomic variables what happen in the second and third.

Let me put it another word, guys. We've had an encouraging first quarter in comparison with our guidance. We've said that we are expecting another encouraging quarter for the second quarter. What we are saying is, we are not changing previous guidance because it may be too early. We are optimistic based on what we've seen in the first quarter, which is encouraging. Jorge mentioned slightly above guidance. I think that was a bit conservative. Actually, 8% guidance was adjusted ROE, and our adjusted ROE for the first quarter is 11.6. It's encouraging. We are seeing encouraging numbers for the second quarter. Of course, we cannot quote forward-looking specifics. In essence, what we are saying here is we want to be cautious before we update. Okay?

Our next question comes from Yuri Fernandes with JP Morgan.

Hey, guys. Good morning. Hi, Juan, Jorge, Nicolas. I would like to ask more a macro question on how you are seeing Argentina today, right? I think February was bumpy. March, the data was pretty good. How are you feeling, Juan, Jorge, Nicolas, like the economy right? Are you seeing a recovery? Are you seeing, I don't know, more demand? On top of that, I know we already had some questions on asset quality, but if you have any early delinquency indicator, right, how are you seeing April and May? When we go to your new NPL formation, the new bad loans, they are still a little bit up, but you are doing more provisions, and they are kind of stable, right? They are growing, but they are growing less.

My question is, I know it's hard to talk about credit peaks in Argentina, and I think you are being good in being conservative on your figures, but I'm just trying to get two callers here. One, if the economy is improving and you are seeing that, two, if it is recovering, the economy is also translating to these early delinquency NPLs, kind of somewhat peaking. I can ask a second topic after this question. Thank you.

Hi, Yuri. Yes, I think that the economy is showing some sign of recovery. When you look at industrial production indices, they are up on a monthly and yearly basis.

What we are seeing is that the harvest at this time of the year is, again, reaching record levels. I would say that the massive consumer sectors that were showing bad performance, the negative numbers that they are showing are less negative. I think that there are some hints that the economy is recovering, slowly but recovering. What we are seeing, and again, I think that we commented this before, is that we are seeing some good trends in the consumer stage 3 between February, March, and April. In terms of the commercial portfolio, it is still deteriorating, but the speed is lower than the one that we saw before. I think that the recovery of the economy is going to have a positive impact in terms of delinquency. The million-dollar question here is when this is going to impact the delinquency trend.

We still don't know if this is going to happen in May or June, or this will happen the third quarter, but for sure, the recovery of the economy is going to have a positive impact in terms of the delinquency cycle.

No, super helpful. If I may, another one just on deposits. I know there is seasonality in the first quarter, and this explained the quarter-over-quarter drop. On year-over-year, checking accounts and savings accounts, what you call the transactional deposits, right? The cheaper funding, they are growing less. I think they are now 41% of total. They were 48% one year ago of your total private deposits. Why is that? Why deposits, especially the cheaper ones? I know inflation has been coming down, so I would expect those deposits that have some kind of cost of opportunity to not decrease. Just checking if you have any color why the cheap deposits, they were a little bit weaker this quarter. Thank you.

You said it before, it's holiday seasons in Argentina. I think it's quite reasonable and logic that in terms of deposits, there were no growth, and in terms of transactional deposits, there was a decline. That's why we do not keep only the trend that we've seen in the first quarter because it's seasonally always the lowest quarter in terms of trend of deposits going forward. We think that this trend is going to turn around, and we are going to show some increase in pesos and dollar deposits. As I mentioned before, the 34% nominal growth in total deposits for the bank for the year, keeping the guidance.

Okay. No, thank you very much.

Welcome, Yuri.

Our next question comes from Carlos Gomez-Lopez with HSBC.

Hello, Juan, Jorge, Nicolas. Thank you very much for taking my question. Two questions. One is, you have a securities gains of ARS 70 billion on your bonds amortized cost. Just so that we understand, that is a voluntary sale of bonds that had appreciated. It should not in itself be recurring. It's the normal operation, and you have bond gain this quarter. I just want to make sure about that. Second, can you tell us about the rest of your amortized bond portfolio and whether you, at this point, have a gain or a loss in that portfolio? Finally, what do you expect for the currency by the end of the year? Thank you.

Hi, Carlos. How are you? For the first part of your question, the ARS 70 billion gain that we posted the quarter was not a repricing of the bond portfolio. It was a sale that we made on part of the bonds that are due in June 2027. The market price was above the accounting price, that is reflecting the ARS 70 billion. Also, we bought, with those pesos, longer duration and higher yield bonds that are due in September 2028, also tied to inflation. Sorry, second question. Can you repeat me that?

Yeah. The unrealized gain or loss in your, essentially, your held-to-maturity securities.

Unrealized gains?

Or loss.

No. Basically are more gains than losses. Honestly, I do not have that number here. I can give it to you later, even though we are not disclosing that as a public information. I try to get it, Carlos.

Thank you.

Third question was? Your third question?

It was the exchange rate. What do you expect for the currency by the end of the year? Thank you.

Basically, we work with two or three different local economies when looking at inflation or FX prices. I think that the consensus for the market is a devaluation of the currency that is below the inflation level. The ranges of a devaluation of the currency is between 20%-22% for the year, when inflation is between 27%-28%. A number that is ranging between 1,700-1,800 by the end of the year. That is what the consensus of the economy that we are working with have.

Very clear. Thank you so much.

Welcome.

Our next question comes from Pedro Offenhenden with Latin Securities.

Hello, Juan, Jorge, Nicolás. Good morning.

Good morning.

I wanted to ask on your loan growth guidance for the year, how should we think it, how the split between ARS and USD loans? If so far in the second quarter, you already are seeing some rebound, maybe, in any specific product, given the more stable funding rates in this quarter?

Hi, Pedro. How are you? Yeah. What we are seeing is in the second quarter, more recovery in dollar denominated loans than in ARS, even though both are positive. Going forward, we are seeing that in this year, dollar loan growth, in terms of the number, is going to outweigh a little bit the ARS, even though the bi-monetary portfolio is going to be about 42% nominal, as we were commenting as the guidance that we gave before.

Okay. Thank you, Jorge.

Welcome.

Our next question comes from Matias Cattaruzzi with AdCap.

Hi. Good afternoon, everyone. Hi, team. I have a quick follow-up on the loan growth guidance. The prior guidance that you gave us on the fourth quarter 2025 earnings call was 20% loan growth for the year, and now you told us 42% nominal. Having in mind 28% inflation, is it a lowering on the guidance?

Hi, Matias. No. The guidance that we gave last quarter was between 15 to 20 real, and now we are now speaking in terms of nominal, so it's pretty the same.

Okay. Great. Then a follow-up on regulation. Do you see room for further easing reserve requirements in coming months? How do you see the second part of the year for the banks? Will the growth in returns for the sector come with a lowering of NPLs, of provisions, and an increase in loans, or will it come also with a tailwind from regulatory environment?

In terms of regulations, I think that part of the increase in the reserve requirements were turned around by the last part of last year. Going forward, I think honestly, it's something that we do not know. It's an instrument that the Central Bank has in order to inject additional liquidity. Honestly, it's hard to say that we are going to see reductions in the reserve requirement scheme going forward. In terms of how we are seeing the rest of the year, it's what we have been talking in this conference call. What we are seeing is that the recovery in the economy that we are seeing, and also this is extrapolated on the increase in loan demand that we are seeing the second quarter. We expect at some point this to positively impact on the delinquency trend.

At some point, this is going to result in relatively lower provisions going forward. I think that the rest of the year might be, and of course, I want to highlight the might, be good for the industry.

Great. One last question about dollar-denominated mortgages. Do you have any comment on that? How's the business going? Is it going to be a stronger part of Banco Macro's business, the US dollar-denominated business with non-US dollar-producing clients?

That gray line is basically for ABC1 clients. It's dollar mortgages, five years. It is evolving, but the increase that we are seeing there is marginal. It's not impacting on the loan portfolio at all. The amounts are small, relatively speaking. They are evolving, but they are not making big difference in the evolution of the loan portfolio of the bank.

Great. Do you expect dollar loans to gain traction throughout the year besides mortgages?

Besides mortgages, yes, because what we are seeing is that sectors like energy, oil, gas, mining, agribusiness are very strong, and those are the ones that might be demanding US dollar loans. With what we are seeing in April and May is some recovery in loan demands in US dollars. Going forward, we expect this trend to continue.

Great. Thank you so much.

Welcome.

Our next question comes from Agustin Pacheco with Banco Mariva. Sir, you can ask your question.

Sir. Hi, can you hear me?

Yes.

Perfect. I would like to ask about deposit performance, which appears to have outpaced both broader system trends and peers, particularly in USD deposits. What were the main drivers behind this outperformance? As system-wide deposits continue to recover, do you expect Banco Macro to keep gaining share?

Hi, Agustin. The idea is that if we want to keep on growing in our loan portfolio and gaining market share going forward, of course, deposits are the main source of funds of the bank. Depending on domestic rates, depending on loan demands, the idea is to continue growing in deposits in both pesos and dollars going forward. This is not a straight upward line. It could have some ups and downs depending on market conditions and depending on the quarters. On a medium long-term basis, yes, the idea is to continue gaining share in deposits.

Perfect. Thanks.

Welcome.

Next question from Camila Azevedo with UBS.

Hi, everyone. Thank you for the space for questions. I have two from my side. First, on capital and dividends. You have close to ARS 4 trillion in excess capital with a coverage ratio near three times. Can you please update us on your capital allocation priorities? M&As, buybacks or additional dividends beyond what's already been approved. My second question would be on your recent acquisition of Banco Sáenz. It is still pending the Central Bank of Argentina approval. What is the expected timeline, and how do you plan to integrate it into the Personal Pay digital ecosystem operationally? Thanks a lot.

Thanks, Camila. Thank you, Camila. On your first question on capital, if you have been following Banco Macro trajectory, the bank has always had as a strategic strength keeping a strong capital position, both to manage the bank through the cycles and as we are doing now, and as you see now, keeping strong results and strong balance sheet despite a delinquency cycle that the system is digesting, but also to be ready to take opportunities of growth, both organic and inorganic. We remain positive for the outlook of Argentina and the possibility of Argentina materializing loan growth, which in terms of loans to GDP, still presents one of the most attractive opportunities in the region. We are still at a level of 11% loan to GDP. When you see peer countries in the region above 30%, 40%, 50% and up to 70%.

As we remain positive and optimistic on that opportunity, we want to keep a strong capital position to support growth. Also, we believe that there are and there will be, or there might be inorganic opportunities to invest. To be specific, we have done that with the Itaú acquisition a couple of years ago and more recently with investment in our complementary digital business, Personal Pay and Banco Sáenz, which we expect to succeed and demand capital going forward. This is despite or irrespective of additional possible opportunities that concentration in the system may present. As you know also, compared with the other countries in the region, the atomization of the system is still there. There's more concentration in other geographies. I think all in all, we are

Comfortable with this capital position because of, first, the optimism in the evolution of the economy and the system and the potential for organic growth, to support the recent inorganic investments that we've done, Personal Pay and Banco Sáenz, and also to be ready for additional potential opportunities that may arise if the concentration in the system continues. That's on capital. The other thing is, as you know, in terms of dividend payment, we have been constrained by the Central Bank regulation limiting dividend payments to 60% of the unassigned results for last year. That's another factor to consider. In terms of Personal Pay and Banco Sáenz, we have presented the filing for the Central Bank approval. We are transiting the process of approval as expected. I will not put specific timelines for the regulator.

The regulator has its procedures, its reviews, and these processes typically take some months. Our central scenario is that we will be ready to start operating the integrated business of the Personal Pay wallet, supported by this dedicated bank-as-a-service platform through Banco Sáenz, by the first quarter next year. This depends on obtaining Central Bank approval in the remainder of this year. That's our expectation, our central scenario. Again, it will totally depend on the regulator, and we don't want to impose any pressure or timelines to them. In the meantime, we are working in parallel, of course, without entering in any gun-jumping risks, in everything that we can do in parallel, so that when we get the Central Bank approval, we are as advanced as possible and up to speed as possible to integrate the businesses as fast as possible.

We are already working in the technological fronts, in the people fronts, in the risk management fronts, developing the capabilities that we need, so that when we have control of the bank, subject to Central Bank approval, we can integrate it as fast as possible.

That's clear. Thank you.

Welcome.

Next question from Brian Flores with Citi.

Hi, team, and thank you for the opportunity to make a follow-up here. Very quickly here, Jorge, I know, I think it was Carlos' question on the securities at amortized cost. We know this portfolio is still relevant, right? And you were opportunistic based on what you mentioned, the market price was higher than your carrying value. Just wondering if from a strategic perspective, we could expect that if market conditions improve, you could be opportunistic and seize these opportunities as they come along, right? What I'm trying to say is that this is not like a sacred part of the book. You could actually deploy or redeploy capital as you see fit, right? Just wanted to check if you have this flexibility, or rather you have a more fixed mandate in your head. Thank you.

Yes, Brian. We are always, as every bank in Argentina, is very on top of the market and trying to find opportunities. I think that what we are seeing is that if you want to get maybe higher returns, you have to go maybe longer duration. The idea is to continue looking at the market, and if there is another opportunity, we are going to go for it. Again, this is something that we cannot forecast, but because it's going to depend on market conditions, on market prices. We always try to get advantage of those conditions. I think that in past quarters or past years, we show that we are very accurate on managing the trend of the markets. The idea is to continue doing that.

Super clear. Thank you.

You're welcome, Brian.

There are no more questions at this time. This concludes the question and answer session. I will now turn over to Mr. Nicolás Torres for final considerations.

Thank you all for your interest in Banco Macro. We appreciate your time and look forward to speaking with you again. Have a good day.

This concludes today's presentation. You may now disconnect.