Q4 2024 Bolsa Mexicana de Valores SAB de CV Earnings Call

February 12, 2025

It will follow the formal presentation, if anyone should require operator assistance during the conference. Please press star zero on your telephone keypad as a reminder, this conference is being recorded.

Operator: A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Mr. Ramón Güemes, Chief Financial Officer. Thank you, Mr. Güemes, you may begin.

Mr. Remo: It is now my pleasure to introduce your host Mr. Remo <unk> Chief Financial Officer. Thank you. Mr. <unk> you may begin.

Speaker Change: Thank you good morning.

Speaker Change: And welcome to Bolsa Mexicana de Valores fourth quarter 2024 earnings conference call.

Ramón Güémez Sarre: Thank you. Good morning, and welcome to Bolsa Mexicana de Valores Q4 2024 Earnings Conference Call. Before proceeding, I would like to provide a brief safe harbor statement. This presentation contains forward-looking statements and information related to Bolsa that are based on the analysis and expectations of its management, as well as assumptions made and information currently available at Bolsa. Such statements reflects the views of Bolsa related to future events and are subject to risk, uncertainties, and assumptions. Many factors could cause the current results, performance or achievements of Bolsa to be somewhat different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, changes in general economic, political, governmental, and business conditions, both in a global scale and in the individual countries in which Bolsa does business.

Ramón Güémez Sarre: Thank you.Good morning, and welcome to Bolsa Mexicana de Valores Q4 2024 Earnings Conference Call. Before proceeding, I would like to provide a brief safe harbor statement.This presentation contains forward-looking statements and information related to Bolsa that are based on the analysis and expectations of its management, as well as assumptions made and information currently available at Bolsa. Such statements reflects the views of Bolsa related to future events and are subject to risk, uncertainties, and assumptions. Many factors could cause the current results, performance or achievements of Bolsa to be somewhat different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, changes in general economic, political, governmental, and business conditions, both in a global scale and in the individual countries in which Bolsa does business.

Speaker Change: Before proceeding I would like to provide a brief safe Harbor statement.

Speaker Change: This presentation contains forward looking statements and information related to bolster that are based on the analysis and expectations or its management.

Speaker Change: As well as assumptions made in information currently available at Volta.

Speaker Change: Such as statements reflects the views.

Speaker Change: <unk> related to future events and are subject to risks uncertainties and assumptions. Many factors could cause the current results performance or achievements of volta to be somewhat different from any future results performance or achievements that may be expressed or implied by such forward looking statements <unk>.

Speaker Change: Including among others changes in general economic political governmental business conditions.

Speaker Change: Both on a global scale and aimed at individual countries and of which bolster does business.

Speaker Change: Such as changes in monetary policies and inflation rates and prices in business strategy and various other factors.

Ramón Güémez Sarre: Such as changes in monetary policies, in inflation rates and prices, in business strategy, and various other factors. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, the actual results may vary considerably from those described herein as anticipated, believed, estimated, expected, or targeted. Bolsa does not intend and does not assume any obligation to update these forward-looking statements. I would also like to remind participants that today's call is being recorded and a replay of this call will be available online on 13 February at Bolsa corporate website www.bmv.com.mx. During this call, all figures are in Mexican pesos as compared to Q4 2023, unless stated otherwise. This call is intended for the financial community only, and the floor will be open at the end to address any questions you may have.

Speaker Change: Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect actual results may vary considerably from those described herein as anticipated believed estimated expected or targeted.

Speaker Change: <unk> does not intend and does not assume any obligation to update these forward looking statements.

Speaker Change: I would also like to remind participants that the base call is being recorded and a replay of this call will be available online on February 13th at bolster corporate website W. W. W. Dot <unk> dot com Doc Amex.

Speaker Change: During this global figures are in Mexican pesos and compared to the fourth quarter of 2023 unless stated otherwise.

Speaker Change: This call is intended for the financial community only and the floor will be open at the end to address any questions you may have.

Speaker Change: Joining us for today's call are <unk> <unk>.

Ramón Güémez Sarre: Joining us for today's call are Jorge Alegría, Chief Executive Officer, Claudio Vivian, Chief Information Officer, José Manuel Allende Zubiri, Chief Capital Formation Markets and Information Services Officer, Gabriel Rodríguez Bas, Director General, SIF ICAP, Alfredo Guillén, Managing Director of Equity Markets, José Miguel de Dios Gómez, Managing Director of Derivatives Markets, Luis René Ramón Arana, Managing Director of Commercial and Marketing, and myself, Ramón Güemes, CFO. With that, I'll turn the call over to our CEO, Jorge Alegría.

Speaker Change: <unk> Executive Officer, now Youll, BVA, and Chief Information Officer, Jose Manuel agenda, Chief Capital formation markets in information services Officer.

Speaker Change: Gabriel Rodriguez, Chief I kept CEO Alfredo begin managing director director of equity markets <unk>, managing director of derivatives markets with some added among managing director of commercial and marketing and myself from a women's CFO.

Speaker Change: With that I'll turn the call over to our CEO of <unk>.

Speaker Change: Okay. Thank you Ramon and good morning, everyone.

Jorge Alegría: Okay. Thank you, Ramón. Good morning, everyone. I hope you are all doing well today. As you know, we released our earnings results and our slide deck yesterday evening, which provides comprehensive details for Q4 2024 results, which we will be discussing during this call. The copies of our press release and the slide decks are also available at bmv.com.mx under the investor relations tab. I would like to begin this call congratulating our colleague, Luis René Ramón, whom you all know very well on his promotion after several successful years as our Investor Relations Officer. He will now step into a new role in the company as Managing Director for Commercial and Marketing.

Speaker Change: I Hope you are all doing well to date as you know we released our earnings results.

Speaker Change: Our slide deck yesterday evening.

Speaker Change: <unk> provides comp.

Speaker Change: Comprehensive details for the fourth quarter of 2024 results, which we will be discussing during this call.

Speaker Change: The copies of our press release on our slide decks are also available on <unk> Dot com bottlenecks are under the Investor Relations stack.

Speaker Change: I would like to begin this call congratulating our colleague Luisa <unk>, whom you all know very well on his promotion.

Speaker Change: That after several successful year SaaS hour.

Speaker Change: E formation and Investor relation officer, he will now step into a new role in the company as managing director for commercial and marketing.

Speaker Change: In this role he will help us better understand customer and market needs. So that we can better adapt our product offering and our value proposition and so helped develop the Mexican market and our businesses.

Jorge Alegría: In this role, he will help us better understand customer and market needs so that we can better adapt our product offering and our value proposition and so help develop the Mexican market and our businesses. This is part of our strategy implementation together with a soon to be released news on the market data and data division that we are also creating as part of the Bolsa Mexicana new strategy going forward. Please join me in wishing Luis René luck in his new position. Congratulations, Luis René. During the call, I will review our financial results and offer a brief insight on the quarter and also on the overall market environment. Following that, I will provide updates on our ongoing projects, changes in regulations on the competitive landscape as well.

Speaker Change: This is part of our.

Speaker Change: Our strategy implementation together with our soon to be released news on the <unk>.

Speaker Change: Market data on.

Speaker Change: That's a division that we are also creating as part of the Bolsa Mexicana new strategy going forward. Please.

Speaker Change: Please join me in wishing leaves Rene locked in his new position. So congratulations given that during the call I will review our financial results.

Speaker Change: Sure.

Speaker Change: Briefing cycle in the quarter.

Speaker Change: Also on the overall market environment following that I will provide updates on our ongoing projects changes in regulations on the competitive landscape as well.

Speaker Change: We want to conclude with a Q&A session, where you can ask any questions via the conference call line.

Jorge Alegría: Finally, we want to conclude with a Q&A session where you can ask any question via the conference call line. With that in mind, let's review the financial highlights, moving to slide number 3, please. I am very happy to share with you that we have a very good quarter, very good report with double-digit growth in several lines like revenues, EBITDA, net income, and earnings per share. Revenues were a little over MXN 1.1 billion, growing 12%. Growth was driven by larger volumes in cross-border transactions, increased trading, and the effect of the conversion on the derivative markets from the old TIIE, the relevant interest rate in Mexico, to the new benchmark announced by the central bank. This caused the derivatives contract fee transformed to the new reference rate.

Jorge Alegría: Finally, we want to conclude with a Q&A session where you can ask any question via the conference call line. With that in mind, let's review the financial highlights, moving to slide number three, please. I am very happy to share with you that we have a very good quarter, very good report with double-digit growth in several lines like revenues, EBITDA, net income, and earnings per share. Revenues were a little over MXN 1.1 billion, growing 12%. Growth was driven by larger volumes in cross-border transactions, increased trading, and the effect of the conversion on the derivative markets from the old TIIE, the relevant interest rate in Mexico, to the new benchmark announced by the central bank. This caused the derivatives contract fee transformed to the new reference rate.

Speaker Change: With that in mind, let's review the financial highlights and moving to slide number three please.

Speaker Change: I am very happy to share with you that we have a very good quarter very good report with a double double digit growth.

Speaker Change: In several lines like revenues EBITDA net income and earnings per share.

Speaker Change: Revenues were a little over $1 1 billion pesos growing 12%.

Speaker Change: Growth was driven by larger volumes and cross border transactions increased trading and the effect of the compression on the derivative markets from the.

Speaker Change: Old Ta the relevant into a break in Mexico to the new bench.

Speaker Change: Benchmark announced by the Central Bank.

Speaker Change: And this quarter the relative constant feed transform to a new reference rate.

Speaker Change: EBITDA was up 13%.

Speaker Change: <unk> $671 million with a 59% margin held up our focus on disciplined cost management.

Jorge Alegría: EBITDA was up 13%, reaching MXN 671 million with a 59% margin, helped by our focus on disciplined cost management. Net income increased 14% and earnings per share were MXN 0.83, up 16% when compared with Q4 2023. As I said, this has been a very good quarter. Now let me go over the full year results, which recovered significantly as well after a slow first half of the year. We will move also on each business line. On slide 4. As you may recall, we had a very slow start at the beginning of 2024. However, full year results now are showing a strong set of numbers with record-breaking figures in revenues and net income. Also, earnings per share shows double-digit growth reaching MXN 2.92.

Jorge Alegría: EBITDA was up 13%, reaching MXN 671 million with a 59% margin, helped by our focus on disciplined cost management. Net income increased 14% and earnings per share were MXN 0.83, up 16% when compared with Q4 2023. As I said, this has been a very good quarter. Now let me go over the full year results, which recovered significantly as well after a slow first half of the year. We will move also on each business line. On slide four. As you may recall, we had a very slow start at the beginning of 2024. However, full year results now are showing a strong set of numbers with record-breaking figures in revenues and net income. Also, earnings per share shows double-digit growth reaching MXN 2.92.

Speaker Change: Net income increased 14% and earnings per share were <unk> 83.

Speaker Change: Up 16% when compared with the fourth quarter of 'twenty three.

Speaker Change: As I said.

Speaker Change: This has been a very good quarter.

Speaker Change: Now let me go over our full year results, which recover significantly as well after a slow first half of the year and we will move also on each business line on slide four.

Speaker Change: And as you may recall.

Speaker Change: We can.

Speaker Change: We had a very slow start at the beginning of 'twenty. Four however, our full year results now are showing a strong set of numbers with record breaking figures in revenues and net income also earnings per share showed a double digit growth, reaching $2 92 vessels.

Speaker Change: Revenues were $4 1 billion increased 6% with growth coming from our post trade businesses stronger activity in the cash equity market and also the compression as I mentioned to future contracts because of the new reference rates.

Jorge Alegría: Revenues were MXN 4.16 billion, increased 6% with growth coming from our post-trade businesses, stronger activity in the cash equity market, and also the conversion, as I mentioned, to futures contracts because of the new reference rate. Expense growth was kept at 5%, increasing by less than MXN 100 million. With this, EBITDA grew 6%, registering a margin of 57%, same as that of 2023. Net income amounted to a record-breaking MXN 1.637 billion, slightly above our previous record of 2022 and 9% above the 2023 results. We are fully aware of the tough challenges ahead. We remain committed to operational excellence, and we will continually be looking for top-line growth opportunities and keeping sound cost management practices as outlined in our strategic plan.

Speaker Change: Expense growth has kept a 5% increasing by less than 100 million pesos.

Speaker Change: With this EBITDA grew 6% registering a margin of 57% same as that of 2023.

Speaker Change: Net income amounted to a record breaking one $6 7 billion pesos slightly above our previous record of 2022, 9% above the 23 results.

Speaker Change: We are fully aware of the tough challenges ahead.

Speaker Change: We remain committed to operational excellence and we will continuously be looking for top line growth opportunities and keeping sound cost management practices as outlined in our strategic plan.

Speaker Change: Now turning to the next slide we can discuss revenue by business line.

Jorge Alegría: Now, please turn to the next slide. We can discuss revenue by business line. Our revenue distribution remains well diversified. Capital formation for the listing of equity, debt, and alternatives, as well as its annual maintenance, contributed this year with 12% of BMV Group's revenue. Transactional business, which consists of equity trading and clearing, derivatives trading and clearing, and OTC trading, generated 35% of revenue. Information services made up of data analytics, indices, valuation, and financial risk management have an 18% weight. Meanwhile, the central securities depository, INDEVAL, which is responsible for custody, settlement, and global market services, mainly cross-border transactions, participated about 29% of our revenues. Moving to slide number 6, we can start discussing equity trading and clearing. Revenues in cash equities trading were up 21% when compared with Q4 of last year.

Jorge Alegría: Now, please turn to the next slide. We can discuss revenue by business line. Our revenue distribution remains well diversified. Capital formation for the listing of equity, debt, and alternatives, as well as its annual maintenance, contributed this year with 12% of BMV Group's revenue. Transactional business, which consists of equity trading and clearing, derivatives trading and clearing, and OTC trading, generated 35% of revenue. Information services made up of data analytics, indices, valuation, and financial risk management have an 18% weight. Meanwhile, the central securities depository, INDEVAL, which is responsible for custody, settlement, and global market services, mainly cross-border transactions, participated about 29% of our revenues. Moving to slide number six, we can start discussing equity trading and clearing. Revenues in cash equities trading were up 21% when compared with Q4 of last year.

Speaker Change: Our revenue distribution remains well diversified capital formation for the lifting of equity debt and alternatives.

Speaker Change: As well as its annual maintenance contribute this year, we have 12% of bnb group's revenue.

Speaker Change: Transactional business, which consists of equity trading and clearing derivatives trading and clearing and OTC trading generated 35% of revenue.

Speaker Change: Informational services made up of data analytics indices valuation and financial risk management.

Speaker Change: <unk> had an 18% weight.

Speaker Change: Meanwhile, the central Securities Depository in Nevada, which is responsible for custody settlement and global market services, mainly cross border transactions.

Speaker Change: Participated or 29% of our revenues.

Speaker Change: Moving to slide number six we can start discussing equity trading and clearing.

Speaker Change: Revenues in cash equities trading.

Speaker Change: <unk> were up 25%, 21% when compared with the fourth quarter of last year.

Speaker Change: The average daily trading value.

Jorge Alegría: The average daily traded value at BMV was recorded at MXN 15.3 billion, up 10%. Trading in the global market, or SIC, grew 33% with a 54% increase in the number of transactions. On the other hand, local market activity decreased by 2%. Our market share for the quarter was 78%. We believe the 2-point reduction in market share reflects the recent price change by our competition. Regarding clearing in CCV, revenue was up 4%, while the total average daily trading volume for both Mexican exchanges were up 11%. The difference in rates is explained by a higher number of cross trades in the quarter, which requires registration but not clearing services. Now, let's go to the next slide to review the derivatives segment.

Speaker Change: <unk>.

Speaker Change: <unk> recorded a $15 3 billion pesos up 10% trade.

Speaker Change: Trading in the global market or seek.

Speaker Change: Grew 33% with a 50, 454% increase in the number of transactions.

Speaker Change: While in the other hand local market activity.

Speaker Change: Decreased by 2%.

Speaker Change: Our market share for the quarter was 78%, we believe that two point reduction in market share and reflects the recent price change by our competition.

Speaker Change: Regarding creating CCD.

Speaker Change: Revenue was up 4%, while total average daily trading volume for both Mexican exchanges.

Speaker Change: We're up 11%. The difference you raised is explained by a higher number of cross trades in the quarter, which requires registration, but not cleaning services now.

Speaker Change: Now, let's go to the next slide to review the derivative segment.

Speaker Change: Revenue in derivatives trading and clearing was up 49% in the quarter, mainly due to higher margin deposits and the non recurring effect of the contract or a contract conversion.

Jorge Alegría: Revenue in derivatives trading and clearing was up 49% in the quarter, mainly due to higher margin deposits and the non-recurring effect of the contract conversion to the new reference swap rate. Both of these effects registered in Asigna, our derivative CCP. The average daily notional value for dollar futures was $325 million, up 5%, while the open interest increased 14% to $8.4 billion. This is explained by high open interest on the December maturity. On the other hand, the average daily notional value of swaps decreased 25% when compared with the same period in 2023, reaching MXN 2.9 billion due to the impact of the new reference rate. That is something that traders are starting to accommodate in their technology and their desks.

Speaker Change: To the new referenced swap rate.

Speaker Change: Both of these effects registered in a stigma.

Speaker Change: Our derivative CCP.

Speaker Change: The average daily notional value for dollar futures was $325 million up 5%.

Speaker Change: While the open interest increased 14% to now $8 4 billion.

Speaker Change: This is explained by high open interest on the December maturity and on the other hand, the average daily notional value of swaps decreased 25% when compared with the same period in 'twenty three.

Speaker Change: Reaching.

Speaker Change: $2 9 billion pesos due to the impact of the new reference rate that is something that the traders are starting to accommodating their technology on their desks. However, open interest increased 54%.

Jorge Alegría: However, open interest increased 54% to MXN 1.3 billion, also explained by the interest rate conversion. In Asigna, the average margin deposits were MXN 54.1 billion for the quarter, showing an increase of 46%, while the full year number was MXN 47.6 billion. This is attributed to a record high in the open interest of swaps and excess margin deposits. We need to remember that we also have a non-recurrent impact from the conversion of contracts to the new reference rate, as we have discussed this several times before. Let's move to our OTC trading results on slide eight. In SIF ICAP, OTC trading and value-added services revenues decreased MXN 13 million, or 7%.

Speaker Change: Two $1 3 billion pesos also explained by the interest rate compression.

Speaker Change: In our Cigna, the Avalanche margin deposits were 50, $54 1 billion peso for the quarter.

Speaker Change: Showing an increase of 46% while the full year number was 47 6 billion pesos.

Speaker Change: This is a tribute to our regular hiding the open interest of swap and excess margin deposits.

Speaker Change: We need to remember that we also have a nonrecurring impact from the conversion of contracts to the new reference rates as we have discussed this several times before.

Let's move to our OTC trading results on slide eight.

Speaker Change: If I Cup OTC trading in value added services revenues decreased 13 million vessels or 7%.

Speaker Change: <unk> got Mexico dropped 7 million pesos.

Jorge Alegría: SIF ICAP Mexico dropped MXN 7 million, as in past quarters, primarily due to the lower CO2 emissions compensations via the carbon credits from our México CO2 platform. Meanwhile, revenue from SIF ICAP Chile was down MXN 6 million due basically to FX fluctuation. On slide nine, we have our figures for capital formation. Listings revenue decreased MXN 1 million, 3% lower due to lower number of issuances in long-term debt and CKDs offerings. As for this quarter, in short-term debt, 321 issuances were placed in Q4 compared to 302 in Q4 of 2023. While in long-term debt, 19 issuances compared to 34 issuances last year. There were no equity listings or follow-ons during this quarter.

Speaker Change: In past quarters, primarily due to the lower steel to emissions compensations via the carbon credits from our Mexico CEO to platform.

Speaker Change: Meanwhile, revenue from semi cap, Chile was down 6 million pesos due basically to FX.

Speaker Change: Fluctuation.

Speaker Change: On slide nine we have our figures for capital formation.

Speaker Change: Listings revenue decreased 1 million pesos, 3% lower due to <unk>.

Speaker Change: Lower number of issuance in long term debt.

Speaker Change: The carriers of TKD offerings.

Speaker Change: As for this quarter in short term debt 321 issuance were placed.

Speaker Change: In the fourth quarter to.

Speaker Change: When compared to three two.

Speaker Change: In the fourth quarter of 2023.

Speaker Change: While in long term debt 19 issuance compared to 34 instruments last year.

Speaker Change: There were no equity listings on our follow ons. During this quarter. However, it is relevant to mention that we lifted during the year to <unk> 14 in 2020 for one of them in the last.

Jorge Alegría: However, it is relevant to mention that we listed during the year 2 sport teams in 2024, one of them in the last month of December. Even though that there were no public offerings, the listings reflect on recovering the activity in the equity markets. Also important to mention, Fibra Prologis and Fibra Mty conducted primary public and private offerings of FIBRA certificates in Q1 of the year for MXN 17.5 billion, as you may recall. Regarding maintenance, revenues were up 9% in Q4 2024. This is because the number of outstanding issues at the end of 2023 was higher than previous year. Additionally, as of the end of 2024, there are 505 outstanding issuances versus 485 at the end of 2023.

Jorge Alegría: However, it is relevant to mention that we listed during the year two sport teams in 2024, one of them in the last month of December. Even though that there were no public offerings, the listings reflect on recovering the activity in the equity markets. Also important to mention, Fibra Prologis and Fibra Mty conducted primary public and private offerings of FIBRA certificates in Q1 of the year for MXN 17.5 billion, as you may recall. Regarding maintenance, revenues were up 9% in Q4 2024. This is because the number of outstanding issues at the end of 2023 was higher than previous year. Additionally, as of the end of 2024, there are 505 outstanding issuances versus 485 at the end of 2023.

Speaker Change: The month of December and even though there were no public offerings.

Speaker Change: Listings reflect some recovery in the activity in the equity markets and also important to mention fever.

Our largest and fever, Monterey conducted primary public and private offerings to all certificate in the first quarter of the year $4 17.

Speaker Change: Billion pesos as you may recall.

Speaker Change: Regarding maintenance revenue were up 9% in <unk>.

Speaker Change: Fourth quarter of 'twenty four and this is because the number of outstanding issues at the end of 2023 watts was higher than previous year.

Speaker Change: Actually as of the end of 2024, there are 505 outstanding instruments versus 485 at the end of 2023. So this should translate in higher income.

Jorge Alegría: This should translate in higher income for this item for this 2025. Moving to the CCV, on slide 10 on INDEVAL's revenue were up 35%, driven by an increase in assets under custody, conversions, settlements, and the number of cross-border transactions, as well as a favorable rate. In the quarter, total assets under custody increased 12% to MXN 38.5 billion. As before, in the local market, the pension fund market, this reform continues to show its effects. Assets under custody from pension funds are growing, and we can see in the numbers, we foresee a gradual but sustained benefit from this initiative over the next six years. As for the global market, both FX and market performance played an important role in our results. Finally, on slide 11, let's discuss information services.

Speaker Change: Before these items for this 2025.

Speaker Change: Moving to the TSV.

Speaker Change: <unk>.

Speaker Change: On slide 10 on in the wireless revenue were up 35% driven by an increase in assets under custody conversions settlements and the number of cross border transactions as well as a favorable rate.

Speaker Change: In the quarter total assets under custody increased 12% to 35 38 five trillion pesos.

Speaker Change: As before in the local market the pension fund market.

Speaker Change: This reform continues to show its effect.

Speaker Change: Assets under custody from pension funds are growing and we can see in the numbers, we foresee a gradual but sustained benefit from this initiative over the next six years.

Speaker Change: For the global market, both FX and market performance played an important role in our results.

Speaker Change: Finally on slide 11, let's discuss information services.

Speaker Change: Information services.

Speaker Change: Services revenues compose of market data and <unk> 206 million pesos in the fourth quarter of 2024.

Jorge Alegría: Information services revenues composed of market data and Valmer reached MXN 206 million in Q4 2024, up MXN 24 million or 14%. The depreciation of the Mexican peso had an important impact on this growth, as MXN 20 million are explained by FX. Excluding the exchange rate impact, revenues increased by MXN 4 million, which is explained by MXN 1 million growth in market data and MXN 3 million growth from Valmer due to new clients and billing of past services. Overall, as you can see, a very good quarter and turnaround of the year. We expect to see more volatility in the near future as we face uncertain times. Let's take a look at our operating expenses on slide 12.

Speaker Change: $24 million or 14%.

Speaker Change: The depreciation of the Mexican peso had an important impact on these growth as 20 million vessels are explained by FX.

Excluding the exchange rate impact revenues increased by $4 million.

Speaker Change: Which is explained by 1 million growth in market data and 3 million growth from Mariner due to new clients and building off.

Speaker Change: Services.

Speaker Change: So overall as you.

Speaker Change: As you can see a very good quarter and turnarounds for the year, we expect to see more volatility in the near future.

Speaker Change: We faced uncertain times.

Speaker Change: Let's take a look our operating expenses on slide 12.

Speaker Change: Operating expenses for 2020 forward 2 billion pesos to presume a billion pesos up 5% or 93 million vessels, which are mainly explained by three concepts two.

Jorge Alegría: Operating expenses for 2024 were MXN 2.0 billion, up 5% or MXN 93 million, which are mainly explained by three concepts. MXN 27 million explaining personal expenses on basically annual wage increments, also reduced expenses from SIF ICAP's variable compensation. MXN 42 million in technology and depreciation expenses due to Evergreen projects, aim to ensure our platform are run smoothly and securely, along with a segregation of post-trade infrastructure of the clearing house for bonds. MXN 15 million is sub-custody. As the value of the assets under custody abroad increase, which also generated additional revenues as we explained in INDEVAL. Please turn to the next slide. I want to update you on the competitive landscape, our ongoing projects, and also changes in the regulation.

Speaker Change: $27 million explained in personal expenses basically annual wage increments.

Speaker Change: Also reduce expenses from <unk> variable compensation.

Speaker Change: $42 million in technology, and depreciation expenses due to evergreen project.

Speaker Change: And to ensure our plants our firms are running smoothly unsecured along with a segregation of postpaid infrastructure of the clearing house for bonus.

Speaker Change: And also $15 million is sub custody.

Speaker Change: The value of the assets under custody of road increase which also generated additional revenues as we explained in the past.

Speaker Change: Please turn to the next slide I want to update you on those on the competitive landscape our ongoing projects and also changes in the regulation.

Speaker Change: Our total capital expenditure for 2024 was 259 million pesos up $71 million in line with our investment plans.

Jorge Alegría: Our total capital expenditure for 2024 was MXN 259 million, up MXN 71 million in line with our investment plans. We continue to invest to accelerate our technological evolution, to adapt to our customer needs and look for ways to help the Mexican market grow and make it more efficient as well as for our customers and clients. We want to provide some updates on slide 13. As we talked about in our last call, our competitor announced a new fee schedule. We, in turn, submitted our request to the authorities to update also our fees. As of now, the authorities have not approved the schedule. We have asked for clarification, they have asked for clarification regarding our assumptions. We are expecting to receive that very soon and if needed, apply them when required.

Speaker Change: We continue to invest to accelerate our technological evolution to adapt to our customer needs and look for ways to help the Mexican market growth on <unk>.

Speaker Change: Make it more efficient as well as for our customers and clients.

Speaker Change: We want to provide some update on slide 13.

Speaker Change: And as we've talked about in our last call our competitor announced a new fee schedule. We in turn submitted a request to the authorities to update also our fees as of now the authorities have not approved as scheduled.

Speaker Change: We have asked for clarification.

Speaker Change: I'll ask one clarification regarding our assumptions, we are expecting to receive that very soon and if needed apply them win.

Speaker Change: Require required so far impacting market share has been minimal, but we are following market developments very closely we are following a soft trends in the market very close and more importantly, we are staying close to our customers to discuss our plans and implementation of the strategy.

Jorge Alegría: So far, impact in market share has been minimal, but we are following market development very closely. We are following also trends in the market very close. More importantly, we are staying close to our customers to discuss our plans and the implementation strategy. I am happy to tell you that last December we received the approval from our financial authorities for the central counterparty services for fixed income bond clearing. There's still work to be done before we start operations. The banking commission needs to audit our systems and procedures. Actually, as we speak, they are performing the audit to review our systems, manuals, processes before giving us the final go ahead. This process has already begun, as I mentioned, and regarding the brokers and members on the market, we already have three, the largest three brokers connected and testing.

Speaker Change: I am.

Speaker Change: Happy to tell you that last December we received the approval from our financial authorities.

Speaker Change: For the central counterparty services for fixed income bond clearing.

Speaker Change: There is still work to be done before we start operations the banking Commission.

Speaker Change: Two, albeit our systems and procedures actually as we speak they are performing the audit to review our systems manual processes before giving us the final go ahead.

Speaker Change: This process has already begun as I mentioned on regarding <unk>.

Speaker Change: Regarding the brokers on members under market, we already have three the largest three brokers connected and testing and we are performing testing as well with one clearing member.

Jorge Alegría: We are performing testing as well with one clearing member and in conversation with other six clearing members that are interested in connecting to perform clearing in this new clearing facility. We need to have at least one more clearing member signed to start operations on that front. We are authorized to start with the clearing of the bonos so far, and we are confident variable rate bonds, the rest of the Mexican sovereign debt and repos will follow shortly. We are planning to start clearing any bonos in Q3. On another very relevant topic, the secondary rules to the amendments to Securities Market Law were finally published. The secondary rules as you may remember.

Conversations with other six clearing members that are interested in connecting to perform cleaning in these new.

Speaker Change: Turning facility.

Speaker Change: We need to have at least one more cleaning member signed to start operations stay on that front.

Speaker Change: We are authorized to start with pringles and the bonus so far and we are confident viral rates advance the rest of the Mexican sovereign debt and repos windfall will follow shortly.

Speaker Change: We are planning to start cleaning and the bonus in Q3.

Speaker Change: On another very relevant topic the secondary rules.

Speaker Change: To be amendments to Mexico Securities market law.

Speaker Change: Finally published.

Speaker Change: The secondary roads.

As you May remember.

Speaker Change: This program seeks to make it easier for new companies.

Jorge Alegría: This program seeks to make it easier for new companies to make it to the market by simplifying regulatory requirements and reducing the cost and timeframe involved. We have been actively promoting the benefits of this initiative and have seen very good response from potential new issuers, both for debt and equities. Recently, we had a webinar with over 900 participants, and we have currently 80 companies in our program from Zero to Bolsa that aims to educate CFOs, CEOs for potential companies on how to take the company from private to public markets. Regarding this topic, it's also very good news to tell that we have, for the first time in several quarters, actually years, that we have 4 IPOs in line, in different sectors, and one of them already passed the listing committee of the exchange.

Jorge Alegría: This program seeks to make it easier for new companies to make it to the market by simplifying regulatory requirements and reducing the cost and timeframe involved. We have been actively promoting the benefits of this initiative and have seen very good response from potential new issuers, both for debt and equities. Recently, we had a webinar with over 900 participants, and we have currently 80 companies in our program from Zero to Bolsa that aims to educate CFOs, CEOs for potential companies on how to take the company from private to public markets. Regarding this topic, it's also very good news to tell that we have, for the first time in several quarters, actually years, that we have four IPOs in line, in different sectors, and one of them already passed the listing committee of the exchange.

Speaker Change: To make to the market.

Negative market by simplifying our regulatory requirements on reducing the cost and timeframe involved.

Speaker Change: We have been actively promoting the benefits of this initiative and have seen very good response from potential new issuers, both for debt and equity.

Speaker Change: Recently, we had a webinar with over 900 participants and we have currently 80 companies in our program from zero to bolster that aims to educate CFO Ceos for potential companies on how to take the company from private to public markets.

Speaker Change: Regarding this topic.

Speaker Change: It's also very good news to tell that we have for the first time in several quarters.

Speaker Change: Actual years that we have for Ipos in line different sectors.

Speaker Change: One of them already passed the listing committee of the exchange. So we expect to have even better news on this front soon of course the names are still confidential.

Jorge Alegría: We expect to have even better news on this front soon. Of course, the names are still confidential. Last of all, I am glad to tell you as well that yesterday, after reviewing our dividend and share buyback practices, our board of directors agreed to keep the 100% cash distribution for this year. They agreed on a MXN 2.05 per share dividend. This is equivalent to 70% of net income while maintaining the dividend yield above 6%. Additionally, we plan to increase our share buyback program to up to MXN 500 million in 2025. The two of these combined are 100% of our net income in 2024. Furthermore, the board recommended to analyze the convenience of canceling the shares that we are currently holding in our treasury.

Speaker Change: Last of all I am glad to tell you as well that yesterday and after reviewing our dividend and share buyback practices.

Speaker Change: Our board of directors agreed to keep the 100% cash distribution for this year they.

Speaker Change: They are greater than a 2.05 peso per share dividend. This is equivalent to 70% of net income while maintaining the dividend yield above 6% additional.

Speaker Change: Additionally, we plan to increase our share buyback program to up to 500 million peso in 2020.

Sorry 2025.

Speaker Change: The two of these combined are 100% of our net income in 2024.

Speaker Change: Furthermore, the board recommended to analyze the convenience of canceling the shares that we are currently holding in our treasury.

Speaker Change: As we said before we do not intend to keep more cash than we can see are necessary and we returning excess cash to our shareholders in the best and most efficient way possible.

Jorge Alegría: As we said before, we do not intend to keep more cash than we consider necessary, and we will be returning excess cash to our shareholders in the best and most efficient way possible. To sum up, Grupo BMV delivered strong results in Q4 2024, mainly due to higher trading in transactional businesses and also increased activity in the post-trade services and the non-recurring effects of the derivatives conversion from swap contracts to the new reference rates. Revenue for the quarter was up 12%, EBITDA margin was 59%, and net income was recorded at MXN 467 million, reflecting a 14% growth. Earnings per share were MXN 0.83, 16% higher than the Q4 2023.

Speaker Change: To sum up Bnb group delivered strong results in the fourth quarter of 2024, mainly due to higher training in transactional businesses and also increased activity in the post trade services and the non recurring effect of the derivative compression from.

Speaker Change: Swap contracts to the new reference rates.

Speaker Change: Revenue for the quarter was up 12% EBITDA margin was 59% and net income was reported at $467 million vessels, reflecting a 14% growth in earnings per share were 83.

Speaker Change: 16% higher than.

Speaker Change: For Q2 'twenty three.

Speaker Change: Our initiatives are beginning to take shape and I am confident that with our new commercial efforts under Louis' Rene we start delivering soon very positive results.

Jorge Alegría: Our initiatives are beginning to take shape, and I am confident that with our new commercial efforts under Luis René, we will start delivering soon very positive results. This is, as I mentioned before, also part of the strategy that we are starting to implement together with our data and the continued evolution of the post-trade initiatives. Thank you for connecting today and listening to my remarks. We are confident that implementing our strategy correctly, we will drive innovation and growth in financial markets for a brighter future. Alongside with my colleagues, we are more than glad to address any question you may have. Thank you very much again.

Speaker Change: Tom.

Speaker Change: This is as I mentioned before also part of the strategy that we are starting to implement together with our data on the continue evolution of the postpaid initiatives.

Speaker Change: Connecting today.

Speaker Change: Listening to my remarks.

We are confident that implementing our strategy correctly, we drive innovation and growth in financial markets for a brighter future alongside with my colleagues, we are more than glad to address any question. You may have thank you very much again.

Speaker Change: Thank you.

Speaker Change: We'll now be conducting a question and answer session.

Operator: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your questions from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. The first question comes from the line of Ernesto Gabilondo with Bank of America. Please go ahead.

Speaker Change: If you would like to ask a question. Please press star one on your telephone keypad.

Speaker Change: A confirmation tone will indicate your line is in the question queue.

Speaker Change: Do you start to if you would like to remove your questions from the queue.

Participants using speaker equipment, it may be necessary to pick up your handset before pressing the studies.

Speaker Change: One moment, please pull for questions.

Speaker Change: The first question comes from the line of Nestor <unk> with Bank of America. Please go ahead.

Nestor: Thank you hi, good morning, Jorge but I'm on.

Ernesto Gabilondo: Thank you. Hi, good morning, Jorge, Ramón, Luis René, congrats on your new position. Good morning to all your team. Congrats on your Q4 results and Bolsa's full year net income growth, which was even higher if we exclude the sale of property from last year. Congrats on that. My first question will be on non-recurring impacts. I'm starting to get some questions from investors trying to understand the non-recurring impacts on FX and interest rates. I remember Bolsa's earnings were under pressure over the last years because of this, and we did not consider them as non-recurring. Just want to double-check if this is in line with your sensitivity to FX.

Speaker Change: Congrats on your new position.

Speaker Change: Good morning to all your team.

Nestor: Congrats.

Nestor: Our fourth quarter results of <unk>.

Nestor: Full year net income growth.

Nestor: It was even higher.

Nestor: The sale of property.

Nestor: Yes, so congrats on that.

Speaker Change: My first question will be on non recurring impacts I'm starting to get some questions from investors.

Nestor: Trying to understand.

Nestor: Nonrecurring impacts on FX and interest rates.

Nestor: <unk> remembers business earnings were under pressure over the last years because of these.

Nestor: We did not consider damage mugler queuing. So just wanted to double check. If this is in line to your sensitivity to FX you.

Nestor: You have mentioned in the past that for every change of one peso.

Ernesto Gabilondo: You have mentioned in the past that for every change of 1 peso, the EBITDA benefits by MXN 50 million. Are the non-recurring impacts related to this? Is there anything else you mentioned something on the swap and the interest rate? If that is the case, just wanted to understand what's the amount for that. My second question is on your new pricing structure. As you mentioned, you are waiting for the authorities on that. Since your competition, BIVA, implemented this new pricing structure, I believe they took 200 basis points market share as of December to 21%. Just wondering how was the market share in January?

Nestor: Benefits by 50 million pesos. So.

Nestor: The nonrecurring impacts related to these or these there is anything else.

Nestor: On the slab.

Right.

Is that is the case just wanted to understand what Jim mountain for that.

Nestor: And then my second question is on your new pricing structure.

Nestor: You mentioned you are waiting for the authorities on that.

Nestor: But it seems competition veeva implemented these new pricing structure.

Nestor: I believe they do 200 basis points, Mike good share as of December to 21%.

Nestor: So just wondering how was the market share in January.

Nestor: And also related to this.

Nestor: You continue to see.

Ernesto Gabilondo: Also related to this, do you continue to see an impact in Bolsa's revenues of around MXN 110 million by the implementation of your new pricing structure? Any color on this will be very helpful. Then just for my last question, is in terms of OpEx and investment. You continue to mention that you will be doing a lot of technology updates and investments, so that will help to support your future revenue growth. How should we think about the OpEx growth in 2025? Anything you can guide us, inflation plus how many basis points will be very helpful. Thank you.

Nestor: Any impact in Boston's revenues of around 110 million pesos late implementation of your new pricing structures any color on this will be helpful.

Nestor: And then just for my last question.

Nestor: In terms of Opex and investment so you continue to mention that.

Nestor: You will be doing a lot of technology updates and investment so that will help to support future revenue growth.

Nestor: But how should we think about the opex growing 25, so anything which entitles inflation plus how many basis points will be helpful. Thank you.

Nestor: Thank you Ernesto.

Nestor: I'll pass.

Jorge Alegría: Thank you, Ernesto. I'll pass to Ramón Güémez to discuss about the first of your questions.

Speaker Change: To put him on women's to discuss about the first of your questions.

Nestor: Thank you Angela and good morning.

Speaker Change: Regarding the nonrecurring impacts we had.

Ramón Güémez Sarre: Thank you, Ernesto, and good morning. Regarding the non-recurring impacts we had, you're correct in what you said. If we have a 1-peso fluctuation in the exchange rate, you know, we should expect around MXN 50 to 60 million impact on EBITDA. That's still valid on a full year basis. This quarter, the conversion to the new reference rate from the old TIIE to the TIIE de Fondeo had around MXN 10 million impact in Asigna. That's also a non-recurring item that we had for this quarter. If we have more what we have on FX, that will continue to be the case.

Nestor: You are correct in what you said it.

Nestor: If we have a one peso fluctuation in the exchange rate.

Nestor: On a year.

Nestor: We should expect around a $50 to 60 million pesos the impact on EBITDA.

Nestor: So that's a.

Nestor: That's still.

Nestor: Valid on a full year basis.

Nestor: And this quarter.

Nestor: The conversion from the new reference rate from the old tier to the theory on deal.

Nestor: At around the 10 million personal impact in us taking them.

Nestor: Sure.

Nestor: That would be.

Nestor: That's also a nonrecurring item that we had for this quarter, if we have more.

Nestor: What we have to on FX.

Nestor: That will continue.

Nestor: To be the case.

Nestor: Regarding the second the new pricing structure and market share and generally.

Ramón Güémez Sarre: Regarding the second, the new pricing instruction market share in January, I'll let Alfredo Guillén take over that.

Nestor: Alfredo Keygen takeover that.

Nestor: I haven't necessarily separately.

Nestor: Regarding market share we didn't see any change from last quarter during January.

Alfredo Guillén: Hi, Ernesto. It's Alfredo Guillén. Regarding market share, we didn't see any change from last quarter during January, so we believe that will stay the same pattern for the rest of at least the first half of the year. Another question you had is regarding the MXN 100 million we had in our projections. We are still waiting for the authorization from the CNBV. So far we haven't changed our tariffs. Just waiting to see if they go through.

We believe that will stay.

Speaker Change: And the same question for the rest of the at.

Nestor: At least the first half of the year.

Nestor: And.

Nestor: And another question you had.

Nestor: Regarding the $100 million.

Nestor: <unk>.

Nestor: <unk> had in our projections, we are still waiting for the authorization from the CFPB. So so far we haven't been.

Nestor: We haven't changed our tariffs.

Nestor: Just waiting to see.

Nestor: Bagel approval.

Nestor: Yes.

Nestor: I will add on the on the tariff side.

Jorge Alegría: I will add on the tariffs on the pricing schedule to that. We are very close to the market participants, measuring sensitivities, price sensitivities. Although we expect to have the authorization very soon from the regulators, I mean, so far the market impact has been relatively small, and we can implement the new tariff schedule in different stages if needed.

Nestor: The pricing schedule so that.

Nestor: We will keep.

Nestor: We are very close to the market participants.

Nestor: Measuring sensitivities.

Nestor: Price sensitivities on the.

Nestor: Although we expect to have the authorization very very soon from the from the regulators.

Nestor: So far the market impact has been.

Nestor: Relatively small.

Nestor: And we can implement the new that is scheduled in different stages we've needed.

Nestor: And regarding our Opex investments.

Ramón Güémez Sarre: Regarding our OpEx investments, we consider inflation for our expenses, maybe one point above inflation. As you know, we don't specifically guide on the future.

Nestor: Sure.

Nestor: Yes.

Consider inflation for our.

Nestor: Core expenses, maybe one point above inflation.

But as you know.

Nestor: We don't specifically guide.

Nestor: On.

Nestor: On the future.

Nestor: No Super helpful. Just a follow up in terms of.

Ernesto Gabilondo: No, super helpful. Just to follow up in terms of the new pricing structure. In the last conference call, you mentioned that you are probably estimating that the impact for you will be MXN 120 million. Is this still the case? Or given that the market share that BIVA has taken is not so much, probably could be lower. Any color on this will be helpful.

Nestor: The new pricing structure. So in the last conference call you mentioned that you.

Nestor: You are probably estimating the impact for you will be one.

Nestor: The medium pencils.

<unk> is still the case or given that the market share that <unk> has.

Nestor: Taken it's not so much probably it could be lower.

Nestor: Any color on these will be canceled.

Nestor: The $100 million refers to the.

Ramón Güémez Sarre: MXN 100 million refers to the full year impact of the full implementation of the tariff change. Let me say that would be our worst case scenario. Depending on how much we actually implement of what gets approved and how we see the market share evolving, it would be less than that. Consider that as the worst case for a full 12-month impact.

Nestor: Full year impact of the full implementation of the tariff change. So let me say that it would be our worst case scenario.

Nestor: So depending on how much we actually implement of what gets approved and how we see the market share evolving it would be less than that so consider that as a as the worst case.

Nestor: For a full 12 month impact.

Nestor: Okay perfect. Thank you very much.

Speaker Change: Well, thank you Adnan.

Ernesto Gabilondo: Perfect. Thank you very much, Ramón Güemes.

Nestor: <unk>.

Speaker Change: Thank you next question comes from the line of Judy Fernandes with JP Morgan. Please go ahead.

Ramón Güémez Sarre: Well, thank you, Ernesto.

Operator: Mm-hmm. Thank you. Next question comes from the line of Yuri Fernandes with J.P. Morgan. Please go ahead.

Judy Fernandes: Hey, guys congrats on the results and congrats congrats on the promotion.

Yuri Fernandes: Hey, guys. Congrats on the results and congrats, Luis René Ramón, on the promotion. I guess a question more on your area on commercial marketing. When I go to the expenses detail here, market expense is up a lot, right? Like 35 year-over-year. I remember talking to you in the past, and also talking to Jorge Alegría and Ramón Güemes, that the company will invest more money to bring you more revenues, right? I guess maybe, you know, marketing costs is also part of that. Just trying to understand what kind of product you have or what kind of revenue you have related to marketing that you need to invest a little bit more in marketing to have these revenues in the future.

Speaker Change: A question more on your area on commercial marketing.

Speaker Change: When I go to an extensive detail here market expenses.

Speaker Change: Our loss rates like 35 year over year.

Speaker Change: And I remember talking to.

Speaker Change: For you in the past.

Speaker Change: And also Turkey talking to Jorge Humberto.

Speaker Change: Company will invest more money to bring them already has right. So.

Speaker Change: I guess, maybe marketing cost is also part of that.

Speaker Change: So just trying to understand what kind of product you have or what kind of revenue you had related to marketing that you need to invest a little bit more in marketing to.

Speaker Change: <unk> revenues in the future just trying to understand is line how marketing expenditures should evolve.

Yuri Fernandes: Just trying to understand this line, how marketing expenses should evolve and what is the revenue line that should be linked to this? Thank you very much.

Speaker Change: What is the revenue lines that should be linked.

Speaker Change: Thank you very much.

Speaker Change: Thank you Julien.

Speaker Change: Yes.

Luis René Ramón Arana: Thank you, Yuri. Yes. On the market data side, we will be very much focusing on the digital aspect since the reach is far more than the traditional media. We'll be focusing a lot on our exposure in not only Mexico but also in the US, which is a very relevant market for us. What I'm talking about is, you know, podcast, YouTube, social media, and different high-level events where we will be able to generate leads that could turn to revenues. Now about the products that we will be announcing. Well, recently we announced the approval of the clearing house. We're also building a very strong data offering, and that's something that we will announce in the next couple of days, some modifications to the infrastructure as well.

Speaker Change: The market data side, we will be very much focusing on the digital aspect.

Speaker Change: The reach is far more than the traditional media.

Speaker Change: So we will be focusing a lot on.

Speaker Change: Our exposure in not only in Mexico, but also in the U S, which is a very relevant market for us.

I don't know what I'm talking about in this call.

Speaker Change: Youtube social media and different at high level events, where we will be able to generate leads.

Speaker Change: Good Turing to revenues.

Speaker Change: Now about the products that we will be.

Speaker Change: Announcing one recently, we announced the approval of the clearing house.

Speaker Change: We're also building a very strong data offering.

Speaker Change: And that's something that.

Speaker Change: We will announce in the next couple of days some modifications to their to the infrastructure as well so our distribution channels and the product offering on data that's.

Luis René Ramón Arana: Our distribution channels and the product offering on data. We believe there is a very good opportunity and there is a lot of runway for that business line to continue growing. The modifications, for example, to the Oferta Simplificada, they were approved recently, and we have two different programs from De Cero a Bolsa, which have been very successful. The last one that we did, there were over 900 people connected. We also want to be out there not only in Mexico City, but in different states, and be sure to be very close to CFOs and making sure that the benefit is coming to both and diversifying their financial needs. As for the expenses, I don't think it's gonna be material.

Speaker Change: We believe there is a very good opportunity and there is a lot of runway for that business line to continue growing.

Speaker Change: The modifications for example to the.

Simplified listings.

Speaker Change: They were approved recently and we have two different programs from zero to Volta.

Speaker Change: Which have been very successful as one that we did there were over 900 people connected. So we also want to be out there not only in Mexico, but in different states and be sure to be very close to cfos and making sure that.

Speaker Change: The benefit come into Bolton diversifying their financial needs.

Speaker Change: As for the expenses.

Speaker Change: I don't think it's going to be material, we're going to be working as I said a lot with digital.

Luis René Ramón Arana: We're gonna be working, as I said, a lot with digital and doing a lot with little. You can expect some growth, but nothing too crazy. Our team-

Speaker Change: And doing a lot with lidl. So you can expect some growth.

Speaker Change: But nothing to Greece.

Speaker Change: Our team.

Speaker Change: Three or four people.

Speaker Change: Nothing to worry.

Yuri Fernandes: Okay

Luis René Ramón Arana: Maybe three or four people, so nothing to worry.

Victor: Okay Super So Victor and thanks, Hey, Congrats again thank.

Yuri Fernandes: Okay. No. Super, super clear. Thank you. Congrats again.

Speaker Change: Thank you.

Speaker Change: Thank you next question comes from the line of Edson leukemia with <unk> capital. Please go ahead.

Luis René Ramón Arana: Thank you.

Operator: Thank you. Next question comes from the line of Edson Murguia with Summa Capital. Please go ahead.

Edson leukemia: Hi, good morning, and thank you for taking my questions.

Edson Murguia: Hi. Good morning, and thank you for taking my questions. The question is, I know Ramón mentioned expenses, but my question is specifically about CapEx. It relates, you mentioned that it's almost double, right? Because the Q4 CapEx was MXN 105 million. My question is, regarding this technological implementation with Evergreen and NASDAQ Post-Trade and so on, are we expecting the same trend line forward for 2025? Because the second question you want to remember on the stages of the implementation, we have been hearing since a couple of quarters that you are implementing this new technology. So how long it's gonna take to be fully operational? And what will be the impact on the CapEx for the following quarters? Thank you.

Speaker Change: I know.

The amount mentioned expenses, but my question is if the global Capex and the earnings release.

Speaker Change: You mentioned that.

Speaker Change: Right.

Speaker Change: The fourth quarter.

Speaker Change: $105 million.

Speaker Change: Question is regarding them.

Speaker Change: And the logical implementation.

Speaker Change: The state and so on.

Speaker Change: Yeah.

Speaker Change: Okay.

Speaker Change: Between in line to continue to refine the cats.

Speaker Change: And then the second question do I remember on the.

Speaker Change: Speaking of the implementation.

Speaker Change: We have been.

Speaker Change: Since a couple of quarters.

Speaker Change: <unk> implemented.

Speaker Change: The new technology, so how long do.

Speaker Change: Fully operational.

Speaker Change: And while we did the impact on the Capex for the following quarters.

Speaker Change: Thank you.

Speaker Change: Yes.

Speaker Change: Julie.

Speaker Change: Sorry, sorry.

Ramón Güémez Sarre: Sorry, Edson. CapEx should be similar to what we're having this year. Let's say our main projects, which is the technological innovation relating in post-trade and the Evergreens, the investment of 2024. 2025 should be similar to the ones in 2025, and they are our main initiatives there. Mm-hmm. Regarding the varying period.

Speaker Change: Sorry.

Speaker Change: Capex should be still.

Speaker Change: Similar to what we are having this year.

Speaker Change: No.

Speaker Change: Let me say that our main projects, which is the technical technological innovation related and post trade and the evergreens.

Speaker Change: The investment of 224, if you should be.

Speaker Change: It should be similar to the ones in 2025, and they are our main initiatives there.

Speaker Change: And regarding the revolving period the implementation I, we're looking at maybe releasing the first part of 2026.

Luis René Ramón Arana: The implementation we're looking at, maybe releasing the first part in late 2026.

Speaker Change: And.

Speaker Change: Mainly the entire solution for the CSB and the equity CCP CCP.

José Manuel Allende Zubiri (Bolsa Mexicana de: With mainly the entire solution for the CSD and the equity CCPs or the cash CCPs for the first semester of 2027.

Speaker Change: <unk> for the first semester of 2027.

Speaker Change: Okay. Okay. That's helpful.

Edson Murguia: Okay. Okay, that's helpful. My last question, Ramón Güemes, on the following with this new clearinghouse that you have in fixed income. Just to understand, it's gonna be fully operational in Q3 2025. Am I getting it right?

Speaker Change: My last question.

Speaker Change: On the following with this new clearing house that you perhaps in fixed income.

Speaker Change: It's key to understand.

Speaker Change: I understand it's going to be fully operational.

Speaker Change: The third quarter term clients mandated right.

Speaker Change: Yes, it will be fully operational third quality this year and the intention is to add the repo transactions by the end of the year.

José Manuel Allende Zubiri (Bolsa Mexicana de: Yes, it will be fully operational Q3 this year, and the intention is to add the repo transactions by the end of the year.

Speaker Change: So okay.

Jorge Alegría: Yeah. Actually, the

Speaker Change: And can book.

Speaker Change: Yes.

Edson Murguia: Thank you so much.

Speaker Change: Most of the Treehouse.

Jorge Alegría: Yeah. I think the most of the clearinghouse for bonds or the clearinghouse services are basically ready. We are in the process of approval from the CNBV. This period of the couple of months or 3 months will be basically due to the regulators approving the operation. From the operational point of view, internally, we can say we are 95% ready. This and the testing process with brokers and clearing members are there. Basically, excellent due to the regulatory scrutiny.

Jorge Alegría: Yeah. I think the most of the clearinghouse for bonds or the clearinghouse services are basically ready. We are in the process of approval from the CNBV. This period of the couple of months or three months will be basically due to the regulators approving the operation. From the operational point of view, internally, we can say we are 95% ready. This and the testing process with brokers and clearing members are there. Basically, excellent due to the regulatory scrutiny.

Speaker Change: For bonds or the.

Speaker Change: The kind of health services.

Speaker Change: Are basically ready we are in the process of approval from the Securities Commission. So this.

Speaker Change: Periods of this through the couple of months or three months will be basically due to the regulators are proving way.

Speaker Change: The operational.

Speaker Change: From the operational point of view internally, we can say we are 95% rating.

Speaker Change: On the testing process with brokers.

Speaker Change: <unk> members are there so basically.

Speaker Change: Sean.

Due to the regulatory.

Speaker Change: Scrutiny.

Speaker Change: Okay.

Speaker Change: Mid tension and Super helpful. Thank you so much and congrats.

Edson Murguia: Okay. That makes sense and super helpful. Thank you so much, and congrats on the full 2024 results.

Speaker Change: A meaningful two important results.

Speaker Change: Okay.

Speaker Change: Thank you next.

Higher Plateau: Next question comes from the line of higher Plateau with UBS. Please go ahead.

Operator: Thank you. Next question comes from the line of Kaio Prato with UBS. Please go ahead.

Speaker Change: Hello, everyone. Good morning. Thanks.

Speaker Change: Thanks for the puts and each year.

Kaio Prato: Hello, everyone. Good morning. Thanks for the opportunity here. Can you talk a little bit about your expectations on capital markets business, please, on listing and maintenance for 2025? Moreover, if you can discuss a little bit about the overall expectations on top line, because we foresee some pressure on trading given this potential price change that we discussed. Just wondering if there is any specific line that you are most excited with for the year that could more than offset this trend, please. Thank you.

Speaker Change: Can you talk a little bit about your expectations on that business.

Speaker Change: Lisa.

Speaker Change: And Moreover, if you can discuss a little bit about the overall expectations on.

Speaker Change: Top line, because we foresee some pressure on training given its potential.

Speaker Change: Price change that we discussed so just wondering if there is any specific line that youre. Most excited at least for the year that could more than offset this trend.

Speaker Change: <unk>.

Speaker Change: Hold on a second.

Speaker Change: Yes.

Jorge Alegría: Yes. Hold on a second, please. All right. Kaio, just to make sure, because we weren't getting a very clear connection, your expectations on capital formation and where we see top line growth and thoughts on top line growth. Is that correct?

Speaker Change: Alright carrier just to make sure because we werent getting a very clear connection your expectations on capital formation.

Speaker Change: And.

Speaker Change: And where we see top line growth our thoughts on top line growth said correct.

Speaker Change: Yes, that's correct.

Speaker Change: Thank you okay.

Kaio Prato: Yes, correct.

Speaker Change: In the listings and pipeline you mentioned.

Jorge Alegría: Thank you.

José Manuel Allende Zubiri (Bolsa Mexicana de: Okay. Regarding the listings and pipeline, as you mentioned, last year was a good one. The standing amount placed on the debt side specifically grew, and that has helped us for the maintenance revenue for the future years. The pipeline in the debt segment is still robust for the next quarter. We have around MXN 35 billion, which will be placed in the next couple of months. We have received many new listing requirements for the debt segment. Also some of them from the big companies requesting to increase the amount on the current program. Regarding the pipeline for the debt segment, we think it will keep on strong.

Speaker Change: Last year was a good one.

Speaker Change: And the funding amount placed on the debt side, specifically grew and does it help us for the maintenance revenue for the food.

Speaker Change: Q2 years.

Speaker Change: The pilot pipeline into that segment.

Speaker Change: Still robust for the for the next quarter, we have around 30 35 billion vessels, which will be.

Speaker Change: Placed in the next couple of months, we have received many.

Speaker Change: New listing requirement requires.

Speaker Change: For the for the Tech segment and also some of them.

Speaker Change: From the big companies.

Speaker Change: <unk>.

Speaker Change: Requesting to increase the <unk>.

Speaker Change: Mount on the current programs so regarding the pipeline for that segment.

Speaker Change: Coupons strong.

Speaker Change: Regarding the equity we are happier.

José Manuel Allende Zubiri (Bolsa Mexicana de: Regarding the equity, we are happy, as Jorge Alegría mentioned, after many quarters, we are getting full IPO requests in the quarter. Hopefully they will be up and running in the market in the next, maybe next couple of quarters. We also have requests for FIBRA and for FIBRA E. Practically in all instruments, we are getting an impulse in the activity for the next couple of quarters. We're optimistic of the regulatory changes on the Oferta Simplificada. We got the webinar with close to 1,000 people connected. There has been a lot of interest from issuers, potential issuers, mid-sized companies from all over the country.

Speaker Change: Both mentioned.

Speaker Change: For.

Speaker Change: Many many quarters, we are getting.

Speaker Change: For IPO requests in the quarter and hopefully they will be.

Speaker Change: Up and running in the marketing mix.

Speaker Change: Uh huh.

Speaker Change: And maybe in the next couple of quarters. We also have a report for EBITDA and Florida fever I E.

Speaker Change: So practically in all instruments, we were getting.

Speaker Change: And any pause in the activity for the next couple of quarters.

Speaker Change: And we're optimistic.

Speaker Change: Regulatory changes under further simplification.

Speaker Change: Got that.

Speaker Change: The webinar with close to 1000 people connected that has been a lot of interest from from issuers potential issuers.

Speaker Change: Mid sized companies from the country.

Speaker Change: Getting on.

Speaker Change: Active Bolton actively involving the promotion methods for this quarter.

José Manuel Allende Zubiri (Bolsa Mexicana de: We are getting actively involved in the promotion efforts for this quarter. Hopefully that will turn up new companies coming to the market in the debt or equity segment in the future.

Speaker Change: Hopefully that will turn.

Speaker Change: New companies coming to market in the Devil.

Speaker Change: Our equity segment in the future.

Speaker Change: Okay.

Speaker Change:

Jorge Alegría: Caio, I'm happy to see the recent development in derivatives volumes. We are like excited to see the interest and if collateral management services from our clearing members improve, I think we are going to see some interesting trends on the derivatives trading and clearing services. A couple of new products coming, but also the implementation of the Bonos clearing is creating some nice, like very good buzz, very good waves of interest in electronic trading for bonds. That's not going to happen in very fast, but we have here some interest from electronic platforms trying to enter the market eventually.

Speaker Change: I'm happy to see the recent development in derivatives volumes.

Speaker Change:

Speaker Change: We are.

Speaker Change: Excited to see the interest.

Speaker Change: On the.

Speaker Change: <unk>.

Speaker Change: Collateral management.

Speaker Change: The services from our pleading members improve.

Speaker Change: I think we are going to see some interesting trends on the and on the derivatives trading and clearing services a.

Speaker Change: A couple of new products coming.

Speaker Change: But also the implementation of the.

Speaker Change: Debt bonds clearing.

Speaker Change: Israel is creating some nice.

Speaker Change:

Speaker Change: Like.

Speaker Change: Very good buys very very good the weights of interest in electronic trading for months.

That's not going to happen in the very very fast.

Speaker Change: We have we have.

Speaker Change: Some interest from electron.

Speaker Change: Electronic platforms trying to enter the market eventually this will benefit ultimately.

Speaker Change: The bond futures something that the market participants, especially in hedge funds and other international players have been asking for.

Jorge Alegría: This will benefit also the bond futures, something that the market participants, especially, hedge funds and other international players have been asking for. That's where I'm seeing some interesting opportunities. Our SIC, the international segment, is also going to be benefited because lower interest rates, and the volatility that the markets are everywhere seeing because of geopolitical reasons, that's going to help also volumes on the international segment. That is a very well-established product, so that provides a lot of flexibility to local players to move between Mexico and international markets. That's also a segment to take a look at it. Those are the three main aspects that I'm watching.

That's where I'm seeing some interesting opportunities.

Speaker Change: Our seek the international segment is also going to be benefited because lower interest rates.

Speaker Change: And the volatility that the markets are everywhere, we're seeing because of geopolitical reasons.

Speaker Change: That's going to help also volumes on the international segment that these are very well established products. So that provides a lot of flexibility to local players to move between Mexico and international market. So that that's also a segment too.

Speaker Change: To take a look at it.

Speaker Change: So those are the three main aspects of that.

Speaker Change: <unk>.

Speaker Change: I'm watching obviously the business as usual that Doug described are closely monitored describing on the listing side on the equity side, we haven't talked about data yet, but that's something that we are still working on the new division for data to have a more comprehensive strategy for the future.

Jorge Alegría: Obviously, the business as usual that José Manuel described on the listing side and the equity side. We haven't talked about data yet, so that's something that we are still working on, the new division for data to have a more comprehensive strategy for the future. Okay. Thank you very much. That is clear. Thank you.

Speaker Change: Okay.

Speaker Change: Okay. Thank you very much.

Speaker Change: Thank you next question comes from the line of Carlos Gomez HSBC. Please go ahead.

Operator: Thank you. Next question comes from the line of Carlos Gomez-Lopez with HSBC. Please go ahead.

Speaker Change: Hello, Thank you for taking my call.

Speaker Change: I Hope this is nothing ask before I wanted to refer to on the exchange rate and the fact that.

Carlos Gomez-Lopez: Hello. Thank you for taking my call. I hope this has not been asked before. I wanted to refer to the exchange rate and the fact that it has helped you. We have seen, as you mentioned in the quarterly, a certain recovery in the global market. You know, given where the peso is today, number one, do you see this as a stable level for the peso going forward? Is that what you're budgeting on? Second, what do you think is going to happen to the global market, the foreign securities traded in Mexico? Do you think that the normal level for them would be higher or lower than what we have today given the current exchange rate? Thank you.

Speaker Change: Yeah, we have seen.

Speaker Change: As you mentioned in the deposit mix.

Speaker Change: Certain recovery in the global market, but given.

Speaker Change: Given where the peso is talking about what do you do you see this as a stable levels for the peso going forward is that what youre budgeting on.

Speaker Change: And second what do you think is going to happen to the global market the discipline.

Speaker Change: <unk> Securities.

I'm trying to the Mexico, and do you see that the normal levels for them could be higher or lower than that where we have today given the current exchange rate. Thank you.

Carlos Gomez: Yes Carlos.

Speaker Change: Sorry.

Speaker Change: Regarding to your first question, where do we expect to see the exchange rate I was getting a lot of abuse for my colleagues here.

Jorge Alegría: Carlos, I'm sorry. Regarding your first question, where do we expect to see the exchange rate? I was getting a lot of abuse from my colleagues here. We sit somewhere between 15 and 35. Which is to say, we don't know. What we can tell in the exchange rate, Carlos, is that the impact we have is MXN 50 to 60 million in EBITDA for a full year from a 1 peso movement. We have a positive exposure to the exchange rate. We're long dollars and we currently have $5 million in the net position in the balance sheet, and we generate dollars from INDEVAL and from Valmer. We don't forecast. We don't plan on forecasting exchange, or we don't do any FX forecasts.

Speaker Change: Yes.

Speaker Change: Yeah.

Speaker Change: We shipped somewhere between.

Speaker Change: 15 and 35.

Speaker Change: Just to say, we don't know.

Speaker Change: What do we can fill in the acute and critical is that the impact. We have is 50 to 60 million pesos in EBITDA for a full year from a one peso movement, we have a positive exposure to the exchange rate we are long dollars.

Speaker Change: And.

Speaker Change: We currently have about $5 million.

Speaker Change: Net position in the balance sheet and.

Speaker Change: And we generate from individuals and from Belmont.

Speaker Change: We don't forecast.

Speaker Change: We don't plan on forecasting exchange or we don't do any FX forecast.

Speaker Change: And could you repeat your second question. Please.

Jorge Alegría: Could you repeat your second question, please?

Speaker Change: Essentially we saw it.

Carlos Gomez-Lopez: Yeah. Essentially, we saw a shrinkage of the global market when the peso became, you know, revalued a lot during 2023. We have continued to see the global market decline as a percentage of the total during 2024. I was wondering if this is a lagged effect and eventually, given that the exchange rate essentially has gone back to what it was back in 2022, we should see a recovery of the global market to the size that it had before. Or do you think there is something structural that has made it smaller?

Speaker Change: As Rinca chocolate global market when the peso became.

Speaker Change: Revalued a lot during 2023.

Speaker Change: And we have continued to see the global market decline as a percentage of total during 2024 and I was wondering if.

Speaker Change: This is a lagged effect and eventually given that the exchange rate is concerned it has gone back to what it was back in 2022, we should see a recovery of the global market decides.

Speaker Change: Besides that he had before or you think there is something structural that has made it smaller.

Speaker Change: Okay.

Speaker Change: Many people use the global market to hedge the peso with the <unk>.

Jorge Alegría: Many people use the global market to hedge the peso with an FX security. Yes, more volatility in the peso should translate into increased trading in the global market. Also with more volatility, you have more arbitrage opportunities. Volatility or a depreciation usually translates into higher volumes in the SIC.

Speaker Change: <unk> security.

Speaker Change: So yes more volatility in the peso.

Speaker Change: We should translate into increased.

Speaker Change: Trading in the global market also with more volatility you have more arbitrage opportunities.

Speaker Change: No.

Speaker Change: Ability or depreciation usually translates into higher volumes in the <unk> and also if you take a look at the portfolio. The global macro portfolio grew 47% just last year. So now we have around <unk> billion dollars.

José Manuel Allende Zubiri (Bolsa Mexicana de: Also if you take a look at the portfolio, the global market portfolio grew 47% just last year. Now we have around $100 billion just from the global market in ETFs usage and equities. That also gives us additional revenues in terms of custody. Maybe the comparison was the Q1 and Q2 of last year were really slow regarding trading. We saw starting maybe in the summer elections and the volatility and geopolitical reasons and stuff, we've seen much more activity, and that growth in assets has helped also to see more activity in the market.

Speaker Change: Just from the global market.

Speaker Change: You have to use it in equities. So that also gives us additional revenues in terms of custody and maybe the comparison was the first two quarters of last year were really slow regarding trading and we saw starting maybe in the summer and Lex Johnson.

Speaker Change: Volatility and geopolitical recent and stuff we've seen much more activity and that growth in assets has helped also to see more activity in the market.

Speaker Change: Okay.

Speaker Change: Okay. So and you expect that trend to continue in British Columbia.

Carlos Gomez-Lopez: Okay. You expect that trend to continue, presumably?

Speaker Change: Ed.

Speaker Change: Yes, so far this year has started with the.

Jorge Alegría: Yes. So far, this year has started with similar volumes.

Speaker Change: Similar volume.

Speaker Change: In a split you. Thank you so much.

Speaker Change: Yes, we're expecting.

José Manuel Allende Zubiri (Bolsa Mexicana de: In this-

Carlos Gomez-Lopez: Thank you so much.

Speaker Change: Okay.

Jorge Alegría: As we're expecting.

Speaker Change: Thank you so much.

Speaker Change: Thank you Carlos.

Carlos Gomez-Lopez: Thank you so much.

Thank you.

Jorge Alegría: Thank you, Carlos.

Speaker Change: A reminder to all the participants that do my best start in one to ask a question.

Operator: Thank you. A reminder to all the participants that you may press star and one to ask a question. Once again, a reminder to all the participants that you may press star and one to ask a question. Ladies and gentlemen, we have reached the end of question and answer session. I would now like to turn the floor over to Jorge Alegría for closing comments.

Speaker Change: On skin, a reminder to all the participants that do my best Star one to ask a question.

Jorge Humberto: Division generated would be at least the end of question and answer session I would now like to turn the floor over to Jorge <unk> for closing comments.

Speaker Change: Yes, Sharon. Thank you all again this has been a very positive quarter. We are excited on the on the in the future of the strategies we are implementing.

Jorge Alegría: Yes, sure. Thank you all again. This has been a very positive quarter. We are excited about the future of the strategy that we are implementing and hope to see all of you next quarter. In the meantime, to thank you all again for your interest in the company. Thank you. Thank you very much, and have a great day.

Speaker Change: And we hope to see you.

Jorge Humberto: All of you.

Jorge Humberto: The next quarter and in the meantime to thank you all again for your interest in the company. Thank you. Thank you very much.

Jorge Humberto: Have a great day.

Jorge Humberto: Yeah.

Speaker Change: Thank you. This concludes today's teleconference. You may disconnect your lines at this time, thank you for participation.

Operator: Thank you. This concludes our today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

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