Q1 2025 Inter & Co Inc Earnings Call
Thank you.
Speaker Change: Good afternoon, and thank you for standing by welcome to <unk> first quarter of 2025 earnings Conference call.
Alexandra Riccio: Today's speakers are as you won't determine enter as global CEO Alexandra Riccio, Brazil CEO.
Santiago Style: Santiago style senior Vice President and CFO. Please be advised that today's conference is being recorded and a replay will be available at the company's IR website.
Santiago Style: At this time all participants are in listen only mode. After the prepared remarks, there will be a question and answer session.
Santiago Style: For this session. We ask you to write down your question via the Q&A icon on your screen. Your name will then be announced and you will be able to ask your question lives.
Santiago Style: At that point, a request to activate your microphone will appear on your screen.
Santiago Style: If you did not want to open your microphone live please write down no microphone and the end of your question.
Santiago Style: In this case, our operator will read your question the op loud.
Santiago Style: Please note that there is an interpretation button on your screen, where you can choose the language you want to hear English or Portuguese.
Santiago Style: Throughout this conference call, we will be presenting non <unk> financial information.
Santiago Style: These are important financial measures for the company, but our non financial measures as defined by <unk> for us.
Santiago Style: <unk> installations on the company's non <unk> financial information to the <unk> financial information are available in the entrance post earnings release and earnings presentation Appendix.
Santiago Style: Today's discussion might include forward looking statements, which are not guarantees of future performance. Please refer to the forward looking statements disclosure in the company's earnings release and earnings presentation.
Santiago Style: Now I would like to yield the floor to Mr. Shuang determining sir the floor is yours.
Santiago Style: Thank you operator, good morning, everyone today, I'm glad to share our strong financial and operational performance for this quarter.
Santiago Style: Even more thrilled about the future we are building at <unk>.
Santiago Style: We are uniquely positioned to thrive in a rapidly changing banking industry.
Santiago Style: The market is moving towards a model that fit us perfectly.
Santiago Style: I believe we are leaving a secular shift with huge opportunities that we are capturing.
Santiago Style: Capturing let me explain why I am so confident on that thesis.
Santiago Style: Back in 2016, Brazil had the highly concentrated banking industry.
Santiago Style: That service was expensive and services were constantly for clients with hidden fees and high charts for basic transactions.
Santiago Style: Since then we saw a significant shift towards digitalization of banking services.
Santiago Style: Over $20 billion were raised in the capital markets.
Santiago Style: The Central Bank of Brazil, Laurence Alexander Bill surplus to promote financial inclusion and competition.
Santiago Style: Many niche players emerge.
Speaker Change: With us being one of the protagonist in this revolution.
Speaker Change: However, we took a different approach than most players.
We chose to focus on sustainable products with a high level of diversification both on fees and credit.
Speaker Change: Although <unk> has made significant progress mostly on transactional costs. It still relies on expensive unsecured credit primarily through credit cards and personal loans.
Speaker Change: <unk> 2016, we have seen a threefold increase in this type of landing.
Speaker Change: Place in Brazil within the countries with the highest credit costs.
Speaker Change: As I mentioned, we have taken a different route which I have been vocal about for many years.
Speaker Change: We operate a mostly collateralized credit portfolio that promotes sustainability for both our clients and ether.
Speaker Change: Beyond credit we offer a wide range of services that contribute to a highly diversified revenue stream.
Speaker Change: Our complete destock platform fosters client engagement encouraging them to use <unk> for the daily transactions, which results in a strong retail funding franchise.
Speaker Change: This is what I call <unk>.
Speaker Change: Winter by design.
Speaker Change: Yeah.
Speaker Change: We see the market moving none direction that aligns with our strategy.
Speaker Change: Some examples are mortgage home equity half GTS loans, along with the new private payroll loan.
Speaker Change: And the upcoming SME beat these to receivables.
Speaker Change: We have a remarkable success in this recently launched products.
Speaker Change: With market shares growing towards our 82% share.
Speaker Change: In the following slides, you'll notice a secular shift opportunity stamp.
Speaker Change: Highlighting the potential in the markets that we are well positioned.
Angie: Sure Angie.
Angie: Please take over to elaborate on our business model. Thank.
Angie: Thank you as well.
Angie: Exciting to see what we are building in the market opportunities on the secular shift.
Speaker Change: Hello, everyone and thank you for joining us today.
Speaker Change: In the first quarter was once again exciting for a lot of all of our businesses and reinforced either as a unique growth story.
Speaker Change: As usual I will highlight the performance of our seven verticals, which represent either as large in complete set of products and solutions.
Speaker Change: For the fifth consecutive quarter, we added 1 million new active clients bring us to a 57% activation rate.
Speaker Change: This is a result of our constant efforts to improve our own boarding process, including early activation strategies and also enhancements in hyper personalization less.
Speaker Change: Last quarter, we personalize their homepage according to each client interactions with Bobby our customer service, but.
Speaker Change: And that increased the conversion of those clients by 12%.
Speaker Change: One our business clients, we grew by 23% year over year, reaching $2 4 million clients. These clients show high engagement and increased our pack levels.
Speaker Change: When we look at bank at our banking performance, we observe seasonality effects typical of the first quarter with lower liquidity and transactional volumes in the market. Therefore, PPV decreased when compared to the last quarter, but has increased by 33%.
Speaker Change: In the yearly comparison, reaching 342 billion reais.
Speaker Change: Transactions made through peak totaled 315 billion reais in the first quarter, achieving an eight 2% market share.
Speaker Change: PPV levels across cohorts are steadily increasing with newer clients transacting more and faster than the older clients.
Speaker Change: Now moving to credit I am pleased to report strong growth in our consumer finance 2.0 portfolio, which includes.
Speaker Change: <unk> financing buy now pay leader and Overdressed.
Speaker Change: In a yearly comparison, our portfolio grew by more than five times, reaching 920 million Reais.
Speaker Change: This quarter, we expanded our product offering by including the new private payroll in only 10 days, we added a $150 million in new credit to our portfolio through a 100% digital underwriting process.
Speaker Change: This brought this product.
Speaker Change: Offer a significant opportunity for us.
Speaker Change: As it is a perfect fit for our business model digital low distribution costs scalable and collateralized with little to no overlap with other credit products, we already offer to our clients private payroll is also another secular shift opportunity and we're seizing it.
Speaker Change: Also worth mentioning our reshaping process on the credit card portfolio is underway with the participation of installments in the total portfolio moving from 7% to 9%.
Speaker Change: Moving forward to the investments vertical AUC increased 54% on a on a yearly basis, reaching 146 billion.
Speaker Change: Our engaged base also maintained growth reaching over $7 2 million active clients. One highlight of this quarter is that we achieved nearly 4% market share of treasury direct balance growing 80 bps in one year.
Speaker Change: Also great evolution in our third party fixed income distribution and on the entire assets assets under management.
Speaker Change: When we look at the yearly comparison.
Speaker Change: Moving to insurance, we had another record breaking quarter.
Speaker Change: We have been experiencing significant growth and penetration.
Speaker Change: Which we can achieve with the right targeting quality products and hyper personalization.
We reached nearly 8 million active contracts growing 51% in just one quarter and sold an impressive $3 5 million items.
Speaker Change: <unk> GTS and Saatchi Zinia, two low ticket, but recurrent products continue to be the highlights.
Speaker Change: Shifting to our marketplace. We saw good numbers to start the year <unk> grew by almost 30% comparing to the first quarter of last year, reaching $1 3 billion.
Speaker Change: This quarter, 8% of the <unk> was generated through our buy now pay later operations. These unique combination enables us to leverage our fee revenues, while also generating interest income from higher margin unsecured credit operations.
Speaker Change: Our global front is growing into next salaried at pace with clients, increasing 41% in the year totally for $4 1 million globally, you see grew around 20% in the quarter with a highlight in the deposit balances, which increased almost 30.
Speaker Change: In only one quarter.
Speaker Change: Recently, we announced the launch of our investment accounts for Argentinians through our partnership with beams and Argentinian bank through this product our clients will have access to our product very similar to our global account used by Brazilians.
Speaker Change: Finally, we surpassed 12 million client scene loyalty, our Alaska business vertical with several ways for them to earn and redeem their points with inter Super App those clients become the most active within our platform.
Speaker Change: They tend to generate many times more back than regular clients and used $2 three times more products.
Speaker Change: This quarter, we added one more airlines to be burn portfolio, and we'll keep evolving the offering.
Speaker Change: Last but not least talking about market share on page 23, we can see a great evolution for many products, we are effectively providing our clients with access to our extensive range of solutions and increasing our share of wallet.
Speaker Change: This evolution is happening both on credit and fee businesses.
Speaker Change: And we gained more than 40 bps of market share in seven of the 10 presented products as we continue to expand our product offerings and enhanced client engagement I am confident that we will further solidify our position in the market now.
Speaker Change: Now I'll pass the mic to <unk>, who will cover the financial part.
Speaker Change: Thank you Shannon the Hello, everyone.
Speaker Change: Starting with loans, we had another great quarter, our total loans grew 33% over the last year three times more than the Brazilian market, notably our <unk> and home equity products have been once again, the key highlights growing 43% and 45% year over year, respectively.
Speaker Change: Both brands have very attractive returns and have been instrumental in improving our portfolio profitability.
Speaker Change: Payroll and personal loans also had great performance with 7% growth this quarter.
Speaker Change: Five two to $5 7 billion the highest growth in many years.
Speaker Change: As shown in this slide we outpaced the market growth in most of our portfolios <unk> and home equity grew about twice as fast as the market continued to gain both market share and prominence in our loan mix.
Speaker Change: <unk> also grew nearly twice the market all women, while maintaining our risk appetite and improving asset quality metrics on.
Speaker Change: On mortgages, we continue to gain share with accretive returns and have been recently favor by competitors being less active.
Speaker Change: Aramark mortgage loans availability decreases.
Speaker Change: We're also seeing an increasing and they are writing of payroll loans and had strong start in the private payroll market, reaching nearly 200 million portfolio in just 10 days of originations, so overall healthy growth trends across profitable and sustainable products.
Speaker Change: Moving to our asset quality page on our metrics showed further improvement even though first quarters are typically more challenging given lower liquidity among individuals.
Speaker Change: The 90 day past due loans ratio demonstrated strong performance, improving 10 basis points going back to 2022 levels.
Speaker Change: The credit card NPL when analyzed across cohorts continued to show strong performance validating the improvements made in our underwriting models.
Speaker Change: And finally, the NPL formation remained stable at one 2% a decrease of approximately 30 basis points over the last 12 months.
Speaker Change: Main improvements came from credit card portfolio combined with strong performance in the collections front.
Speaker Change: On this page, we can see the evolution of our cost of risk metric too.
Speaker Change: To keep improving our financial reporting Kpis. We include all the securities that generate provision expense in this ratio.
Speaker Change: This quarter, we reached a $4 six cost of risk level.
Speaker Change: 20 basis points related to a prior quarter and experiencing the best performance since 2022.
Speaker Change: Furthermore, our coverage ratio has increased from 136% to 143% due to significant organic improvements in our NPL levels as seen on the prior page.
Speaker Change: We had another strong quarter of funding growth, increasing 35% on a year over year basis, and surpassing 59 billion Harris.
Speaker Change: This growth was primarily driven by time deposits, which is mainly explained by <unk> increases and the success of my Big bank or a product for which clients can easily invest in fixed income.
Speaker Change: At the same time the decreased interest central deposits was impacted by seasonal effects.
Speaker Change: It had been in prior first quarters.
Speaker Change: He is also important to mention that our active clients had an average of 1000 930000 Harris in deposits the second highest in our history.
Speaker Change: Lastly, our loan to deposit ratio decreased from 75% and 2%, marking the high growth in our funding franchise.
Speaker Change: The healthy growth and funding mix demonstrated on the prior page enabled us to have an industry, leading indicator among Brazilian banks and Fintech.
Speaker Change: Our cost of funding stood at 53, 8% of CVA this quarter decreasing one nine percentage points year over year.
Speaker Change: Jumping into a revenue page.
Speaker Change: Achieved a $3 2 billion in total gross revenue and $1 8 billion in net terms, our year over year growth of 38% and 31% respectively.
Speaker Change: The growth in fee was affected by seasonal factors, particularly due to the decrease in PPV and GMB as well as changes in the resolution four nine success, which requires us to defer great revenue fees through the life of the loans.
Speaker Change: On the NII front, the strong performance was primarily driven by improvements in.
Speaker Change: In our mix towards higher oil products ongoing repricing and increase returns in our investment portfolio.
Speaker Change: As we are experiencing higher engagement as presented by Shanda, we observe acceleration in revenue in both new and older cohorts, we surpassed 116.
Gross ARPA immature cohorts demonstrating the sustainability long term relationship we're building with our clients.
Speaker Change: First quarter net ARPA was impacted by fee revenue performance as explained earlier.
Speaker Change: We expect to resume growth in the second quarter as greater penetration continues to increase and the impact begins to dissipate.
Speaker Change: On the other hand, our efforts to optimize operations and streamline expenses contributed to our Cts to increased 6% in the quarter, achieving 13 one per client.
Speaker Change: Yeah.
Speaker Change: Now, let's dive into our needs.
Speaker Change: It's important to Highland.
David: David the NIM methodology to better capture our financial performance by including cash and equivalents from compulsory notes in the central bank and excluding impairment on lending.
David: Both our NIM 1.0, and 2.0, which excludes the non interest receivables.
David: Recently showing growth over the past four quarters achieving record levels once again this quarter.
David: As mentioned already NII growth and by consequence, NIM expansion are the result of our disciplined capital allocation strategy, which has compounding results quarter after quarter when.
David: When we consider the risk adjusted NIM, which the cost of risk. The performance is even stronger growing 20 bps quarter over quarter.
David: <unk> expenses were able to decrease our overall expense base by $10 million has.
David: Training, our commitment to cost control and operating leverage.
David: We delivered this improvement while continuing to invest in technology, focusing on process optimization automation and providing a seamless experience to our clients.
Keep increasing the gap between net revenue growth and expense growth is one of our key goals.
David: For another quarter, we were successful in increasing revenue in a faster pace, while maintaining our cost under control as a result, our efficiency ratio once again decreased reaching.
David: 48, 8%.
David: The 30 bps improvement relative to the prior quarter.
David: Finally.
David: I'd like to highlight another quarter of success in our journey towards our profitability goals. We reached 12, 9% ROE excluding minority interest and a record net income of $287 million.
David: Our consistency of progress quarter by quarter is remarkable in our opinion as you can see on this slide.
David: As you all understand the mentioned, we're increasing our profitability by offering a sustainable menu of products, making these results a very high quality.
Speaker Change: Now I'll pass it back to dwell for his closing remarks.
David: Thank you.
Speaker Change: Thank you <unk>. Thank you Sandy.
Speaker Change: As we approach the halfway Mark for our six territory plan I couldnt be prouder of the progress achieved so far.
Speaker Change: We ended the first quarter with 38 million clients.
Speaker Change: 48, 8% efficiency ratio and at 12 nine.
Speaker Change: Percent Roe.
Speaker Change: As I always say every new quarter is our best quarter ever and.
Speaker Change: And it's not just about these numbers, it's about building the future.
Speaker Change: As I said, we're leading the market shift with our inter by design approach.
Speaker Change: Thanks to our sustainable win win model that benefits all stakeholders.
Speaker Change: A special thanks to our team.
Speaker Change: And this journey so amazing.
Speaker Change: Operator, you can now open for the Q&A session.
Speaker Change: We will now begin the question and answer session.
Speaker Change: Please note that in the interest of time, we will allow each participant to ask one question with one follow up for each question. Once again for this Q&A session. We ask you to write down your question via the Q&A icon at the bottom of your screen. Your name will then be announced journey, we'll be able to ask your questions live.
Speaker Change: At this point a request to activate your microphone will appear on your screen. If you prefer not to open your microphone live. Please write down no microphone at the end of your question and our operator will read your question out loud.
Speaker Change: Our first question comes from Mr. Pedro Leduc from <unk> BBA.
Speaker Change: Mr. Luke we're now opening the audio so you can ask your questions live.
Speaker Change: Please go ahead Sir.
Mr. Luke: Hi, good morning, everybody. Thank you so much for the call and the question congrats on the quarter. So quick ones. Please have any first comments to make on the on the private payroll product.
Mr. Luke: I have been the learnings so far X or some sort of volume that you can share any impact on this quarter whatsoever, and then second on your NIM.
Mr. Luke: Directory.
Mr. Luke: Have a nice another advance this quarter.
Speaker Change: But if you can help us also understand the moving pieces here because from a pricing.
Mr. Luke: <unk> yields what played against or in favor Sn.
Mr. Luke: Essentially triangle gosh, if we can expect the continued expansion in NIM in the next two quarters as well. Thank you.
Mr. Luke: IP wrong here. Thanks for the question I'm going to cover the first part and then <unk> mentioned about the second part of the question. So first of all regarding the private payroll as I mentioned on the call.
Mr. Luke: We're very excited of the product.
Mr. Luke: Yeah.
Mr. Luke: Music for outer years, because at the end of the day, what we call winter by design, it's all about them a good product a huge pent up demand, where we can benefit from our fund funding franchise, our 100% distribution channel. So it's a very good news for US that we have this project up and running but as always.
Mr. Luke: At <unk>, we'd like to proceed fast, but with cost so we could be growing.
Mr. Luke: It could be growing faster than we are about <unk>.
Mr. Luke: Trying to understand all didnt less of the product, but long story short very good opportunities for enterprise to capture them.
Mr. Luke: A big market share on this product on the years to come.
Mr. Luke: And frankly will comment now on the capital. Thank you.
No impacts in this first quarter right trials from the new product yet.
Mr. Luke: No no impact yet.
Mr. Luke: Okay.
Mr. Luke: Thank you for the questions on Nims and.
Mr. Luke: This is the result of our capital allocation strategy that we have been working with for many years by now and we think that the consistency of the results and the global NIM, both before and after the cost of risk speak for themselves.
Mr. Luke: There are a few.
Mr. Luke: <unk> planer with covering verticals that continue to be.
Mr. Luke: Two today, which is one is the credit mix continues to improve the credit mix even within the secured component. We have these products like <unk> and our home equity we have maybe a 40% marginal Roe.
Mr. Luke: And then on the <unk> also we have the <unk>.
Mr. Luke: Financing the buy now pay later.
Mr. Luke: Payroll that John alluded to also improving.
Mr. Luke: The yields as a consequence of mix change and then the second element is within each of the specific portfolio goes the interest rates are also going up particularly on the loan portfolio as you know.
Mr. Luke: The payroll.
Mr. Luke: And the mortgages, which were issued when the facility was low and now we are originating them.
Mr. Luke: Margin.
Mr. Luke: Around 20% and therefore, the performance increases and the last point is on the yields of the investment portfolio and we're also working on.
Mr. Luke: On improving yields which are now above 100% of CDI.
Mr. Luke: Combined with the capital optimization at the holding level, which as you know we'd be moving part of the excess capital from the Opco to Holdco.
Mr. Luke: And therefore housing some benefits reflected not that are not reflected in the name that are reflected in the effective tax rate, but we can gross it up on the NIM.
Mr. Luke: All of that together is yielding these strong results. The good thing is that we are we have a lot more to continue improving on this front. The majority is still to come particularly from the <unk>.
Mr. Luke: Consequence of mix improvements.
Mr. Luke: <unk> is playing out pretty well private payroll as an example of that we start to bring that product from the very beginning of the first day.
Mr. Luke: That would be another lever.
Mr. Luke: The NIM expansion that we didn't have obviously planned when we.
Mr. Luke: When we presented the CD 30, 30, nor when we did the budget for 2025.
Mr. Luke: And hopefully we continue growing and improving our nims.
Mr. Luke: Consequently revenue productivity.
Mr. Luke: Thank you so much.
Mr. Gustavo: Our next question comes from Mr. Gustavo <unk> from Citi.
Speaker Change: Mr. Schroeder and we're now opening the audience. So you can ask your questions live. Please go ahead Sir.
Speaker Change: Hi, Good morning, everybody. Thanks for taking my question and congrats on the results I have two questions as well. The first one is regarding the loan growth.
Speaker Change: Excluding the prepayment.
Speaker Change: Receivables loans grill like 20, 21%. So my question is.
Speaker Change: Should we expect some acceleration in the second the second.
Speaker Change: Quarters.
Speaker Change: Do you see the China environment regarding inflation and high interest rates or do we expect.
Speaker Change: The bank accelerating as loan growth and also a few words about consumer loans, which reached 920 million what is the level should we expect that with the reach in 2025.
Speaker Change: And my second question is regarding the margin for active customer.
Speaker Change: As you saw it in our slide 31.
Speaker Change: We saw an increase in our park.
Speaker Change: And a decreasing cost to serve but there was a negative impact on net our box. So could you explain what is just the negative impact in the net back it was related to 490, <unk> Ru or I mean, what can explain this decrease in net our Bakken as a resulting margin per customer. Thank you.
Santiago Style: Hi, Gustavo Thanks for your question discharged speaking.
Santiago Style: I'll start with the credit growth so far this year, we're expecting growth in the range of 25% to 30%, even excluding the dispersion of credit card receivables credit lines like the private payroll that's wrong.
Santiago Style: Explored in the previous question is going to likely boosted because it's something totally new and we see no room for a cannibalization of the existing portfolio. So that's going to be on top of our normal growth micro improvements that we've been doing in other credit modeling are going to help this growth also.
Santiago Style: And we will keep executing smart strategies. So that we can grow as we have been growing the last two years right without lowering the bar on credit quality. So this is very important for us and we're excited with the year to come so far.
Santiago Style: No impact on inflation and interest rates, which has a lot to do with the either by design rates two thirds of the portfolio collateralized. One third are not collateralized and very diligent on all the modeling and policies on the non collateralized sparked this is part of the story.
Santiago Style: When we move to the to the consumer finance 2.0 peaks financing and things like that.
Santiago Style: We continue to be excited about it the product is growing so we have more than 30% growth quarter on quarter in the total portfolio.
Santiago Style: We're optimizing volume.
Santiago Style: As we grow in a mix of volume and pricing to make sure that we bring the NII that we need to bring at the same time that we address clients.
Santiago Style: We see the potential for this portfolio to reach.
Santiago Style: Somewhere around $1 5 billion, maybe we'll have to navigate through the year, you'll see how it goes but that's a number that we that we cant name about one five coming from this.
Santiago Style: <unk> 'twenty and one next step that's going to be interesting is we're going to we're going to launch a variation of a credit card, which we're going to call winter cards.
Santiago Style: Where we're going to be able to address clients.
Santiago Style: With a credit with a credit limit to be used in platform and on tax credits.
Santiago Style: And with this product will not be able to address a client that has.
Our credit rating, that's marginally lower than the ones that have a full credit card and we're also hoping to see good results from these.
Santiago Style: From these from this strategy from this product and to finish on.
Santiago Style: One hour one hour consumer finance to zero portfolio, we haven't seen any delinquency variations from what we have been discussing in the prior calls meaning that we have a healthy delinquency on all of these products. Thank you.
Santiago Style: Consolidated.
Santiago Style: Part, which had to do with the margin might imperative clients.
Santiago Style: Just another way to ask the plaque.
Santiago Style: The ARPA.
Santiago Style: In this quarter that may not happen.
Santiago Style: Cost of funding.
Santiago Style: Decrease and therefore the margin per active client also.
Santiago Style: As a consequence of a few factors on the one hand.
Santiago Style: Were affected this quarter with seasonal and non seasonal factors and therefore, when you are running a practice times two.
Santiago Style: We added 1 million new active clients this quarter, which is what we did most of that left.
Santiago Style: So we maintain the capacity to attract them.
Santiago Style: Any plans on that but the good thing is that when we see it on a cohort basis, we see very strong performance.
Santiago Style: 402 cost of funding on the golf course, and that gives us confidence that the.
Santiago Style: The trend is moving in the right direction.
Santiago Style: Lastly, our two principal very strong improvement that we've had recently that are not measured in the RFP issued in a way, which is the cost of risk or the delinquency levels.
Santiago Style: Efficiency that comes on the back side that affects us elaborate so putting all that together, we're confident that the monetization of the clients which is what.
Santiago Style: The short answer.
Santiago Style: Moving the right direction and as long as we continue.
Santiago Style: This level of client and something <unk>.
Santiago Style: Extracting from that.
Santiago Style: Financial perspective, we are we're happy with the trends.
Santiago Style: Okay. Thanks for that so just just to follow up on this last one.
Santiago Style: <unk>.
Santiago Style: So this is let's.
Santiago Style: Let's say, it's small decrease in net our box.
Santiago Style: Was related to cheese needs to.
Santiago Style: Correct.
Santiago Style: In this way.
Speaker Change: Yes, because EMEA Nia NII side the performance was strong.
Speaker Change: And if you want I can tackle that one which is the underlying question so fees decreased this quarter.
Speaker Change: Approximately $100 million.
Speaker Change: The fourth quarter level, the fourth quarter is always a very strong quarter.
Speaker Change: And we had around $40 million lower fees coming from interchange of cards and inter shop, which is normal for the fourth quarter is stronger than we had $105, which is partly from capital gains in the pod.
Speaker Change: And then the last is the 496, six rule, which forced us to defer around $20 million reais or.
Speaker Change: For fees associated with mortgages.
Speaker Change: Student loans throughout the life of the loan.
Speaker Change: From from seasonal factors have been particularly in the Chubb 40 from.
Speaker Change: In Japan, and then 490 <unk>.
Speaker Change: Furthermore, immunoassay, which we commented on the life of the.
Speaker Change: Contracts, but initially we have that.
Speaker Change: That impact so those three things together, so that the increase of iron ore.
Speaker Change: Versus the fourth quarter.
Speaker Change: When you then divided by clients and all the impacts of the ARPA.
Speaker Change: So very clear guys. Thank you very much.
Speaker Change: Without.
Speaker Change: Our next question comes from Mr. Mario <unk> from Bank of America. Mr. Perry, We're now opening the audio so you can ask your questions live.
Please go ahead Sir.
Speaker Change: My apologies we are now.
Speaker Change: Moving.
Speaker Change: <unk> from Mr. Tito <unk> laboratory.
Speaker Change: Mr. Lavazza, we're now opening the audio so you can ask your questions live Mr. <unk>.
Speaker Change: From Goldman Sachs. Thank you Sir.
Speaker Change: Thank you.
Speaker Change: Anyone.
Speaker Change: Good morning, Thanks for the call and taking my question.
Speaker Change: My question is on the efficiency ratio I mean, you've kind of addressed it a little bit.
Speaker Change: Discussing fee, but we did see some seasonality on fees, but also saw some good performance in expenses in terms of benefiting maybe from some seasonality, although on a year over year basis expenses still growing a bit faster than revenue. So.
Speaker Change: Help us think about the outlook for expenses and how efficiency.
Speaker Change: We continue to improve throughout the year to eventually.
Speaker Change: 30%.
Speaker Change: Long term targets.
Speaker Change: Yeah.
Speaker Change: The selling expenses.
Speaker Change: <unk> in general we are we had two factors that played out in the second half of last year.
Speaker Change: That's the reason why we went from roughly 48 to slightly above 50, which led to the one the conciliation of enterprise in the third quarter and also efficiency in the investment portfolio.
Speaker Change: As we mentioned.
Speaker Change: In prior calls so those two things together impacted at around 300 basis points of efficiency from the second quarter to the third quarter of.
Speaker Change: Last year and we've been run two quarters about 50. This quarter, we were able to see more operational leverage as a consequence, mainly on the expense front.
Speaker Change: Two we're able to control expenses and they were all of them are down nominally like $10 million.
Speaker Change: Going forward, we think that the efficiency ratio improvements will come mainly as a consequence of topline growth being more than the growth in expenses.
Speaker Change: And we always will.
Speaker Change: I've said on Sunday mentioning at the beginning of this call.
Speaker Change: Loan book we.
Speaker Change: We're seeing it growing 25% to 30% on top of that we will have margin X, where we hope to have the margin expansion. Therefore.
Speaker Change: Ready to go north of that loan growth is valid and.
Speaker Change: And expenses will grow at a fraction of that it's difficult for us to anticipate exactly what level of debt.
Speaker Change: Delta in the growth ratios of both levels.
Speaker Change: We're seeing to get to 30% by 2020.
Speaker Change: Seven independently seven is one and a half to two percentage point improvement per quarter. If you do do that linearly obviously like seasonally here, but if you if you have.
Speaker Change: And a proclamation of that.
Speaker Change: It's in line with what we see in our.
Speaker Change: Again as I mentioned, it will be a consequence of Muslim.
Speaker Change: Our performance on the top line on the expense front.
Speaker Change: This quarter is seeing the the direction of 130 bps improvement.
Speaker Change: And a whole bunch of levers.
Speaker Change: Thanks, Andy that's helpful. Maybe just a quick follow up on that.
Speaker Change: You mean sort of expense drivers from here right I mean, you had into peg last year.
Speaker Change: Now marketing was down quite a bit on the quarter.
Speaker Change: It seems like you should have a lot of operating leverage.
Speaker Change: Like where do you still need to invest what's still driving expenses higher.
Speaker Change: Because I would think it should be a little bit more steady regardless of what happens with revenue now just to put it into context.
Speaker Change: So far our expense base approximately one third is salaries and personnel on that when we have a lot of room for operational areas with the remaining two thirds.
Speaker Change: A big component of that.
Speaker Change: Holiday driven expenses.
Speaker Change: Leading suppliers from a broad cloud computing et cetera.
Speaker Change: We're working to have more operational leverage.
Speaker Change: In Italy, there are not so.
Speaker Change: Meaningful as they grow with the volume of the business.
Speaker Change: Therefore.
Speaker Change: They are variable expenses.
Speaker Change: Working very heavily on.
Speaker Change: Proving the quality of the contracts that we have with the suppliers to effectively travel operations as we move forward.
Speaker Change: And then there are other expenses like branding.
Speaker Change: Fixed expenses.
Speaker Change: India, two thirds that we can have as well.
Speaker Change: So that's part of the work we're doing with the team.
Speaker Change: The final area that I would mention is AI will racy AI playing both on the call.
Speaker Change: The front end.
Speaker Change: On the revenue side.
Speaker Change: Important role, but to get at the very beginning on the cost side for example, there.
Speaker Change: The customer service Department.
Speaker Change: Two clear examples where we are with even advanced development.
Speaker Change: And then on the revenue side, the hyper personalization that we mentioned exactly <unk> New York.
Speaker Change: When you open the App the App is highly personalized depending on the person uneven depending on what are the person east 90 to the airport.
Speaker Change: Subtract insurance offering and ethics offering and so we are having.
Thing.
Speaker Change: Revenue.
Speaker Change: Long answer but.
Speaker Change: Basically were.
Speaker Change: Actively driving the outcome to make the variables.
Speaker Change: Expense lines more fixed and less variable.
Speaker Change: We do that.
Speaker Change: Evolve.
Speaker Change: <unk> should be more meaningful.
Speaker Change: Okay Super helpful. Thank you. So one third on the salary and personnel there should be a lot of operating leverage at the other two areas, where you are working to see where you can improve.
Speaker Change: Exactly.
Sandy: Thank you Sandy.
Speaker Change: Our next question comes from Mr. Thiago Batista from UBS.
Speaker Change: Mr. Battista we're now opening the audio so you can ask your questions live. Please go ahead Sir.
Speaker Change: Hello.
Speaker Change: Alright.
Yes, we can hear you Sir go ahead okay.
Speaker Change: Congratulations for the results and thanks for the opportunity.
Speaker Change: I have two questions. The first one on the global accounts.
Speaker Change: You guys are achieving more than 4 million clients are is amazingly strong, especially if you compare with your 22 million effect of clients as a whole.
Speaker Change: Can you share.
Speaker Change: First the profile of those clients and your strategy.
Speaker Change: On how to.
Speaker Change: Looking forward, how do you believe a.
Speaker Change: Global accounts.
Speaker Change: We will evolve this.
Speaker Change: Second one on asset quality.
Speaker Change: The numbers of this quarter.
Speaker Change: Most of them are positive after quality, we saw a small decline in NPL ratio cost of risk also declining did level off any DAU of around 4% and cost of risk of $4. Five is this a normalized level or.
Speaker Change: Can see further improvement, especially as credit card since that have improved a lot at least looking to the stage III. We saw almost 100 bps Q over Q decline this digital real quick.
Speaker Change: This is a normal level or we can see further improvement going forward.
Speaker Change: Yeah.
Speaker Change: Sure.
Speaker Change: Speaking I'm going to cover the first one regarding the global call. So.
To be honest I think that we haven't been able to explain exactly our view for the globe account and have you tried to do that again.
Speaker Change: I am very excited with the product the reason why the global contemplate.
Speaker Change: Brazilians today and laid off or other geographies.
Speaker Change: We can play a very good arbitrage and what do I mean by that we can bring.
Speaker Change: The top clients from Brazil, Argentina now for instance, we're going to launch.
Speaker Change: In the coming months.
Speaker Change: And price.
Speaker Change: Wontedly for U S dollar based products, such as remittance debit car credit car shopping loans lawyers to everything that we have north to perhaps so this this this vision of getting the best clients the premium clients from depth regions geographies and pricing them.
Speaker Change: Very well therefore are producing good returns for us on product that they cannot access.
Speaker Change: Through their dogmatic.
Speaker Change: <unk>.
Speaker Change: The.
Speaker Change: Vision for Day-glo account and it's been it's being really really well in Brazil. So I am very excited with that with this there is opportunity to connect.
Speaker Change: I'd say midterm or.
Speaker Change: Maybe one hundreds of millions of clients.
Speaker Change: Later on on the future.
Product.
Speaker Change: Our profile so the eye.
Speaker Change: I agree they are very good.
Speaker Change: Our clients.
Speaker Change: I'd say that the IRA extra the best clients that have it.
Speaker Change: Better than our park very good cost to serve them. So we're excited with the success of negligible, so far but still a lot to come on that front I'm really really excited with the distribution of that being perhaps two years ago and I'll start to recover up about the NPL and coverage ratio. Thank you Chuck.
Speaker Change: So Joe on the asset quality front, we are very pleased with the performance that we had in the past few quarters.
Speaker Change: Also we're pleased with our first quarter, which you said quarter, which is typically.
Speaker Change: No because <unk>.
Speaker Change: You guys have less liquid eating there.
Speaker Change: Pakistan, despite that we're able to improve the MP editor.
Speaker Change: But ultimately the level at which we will be running going forward will depend on the mix.
Speaker Change: We are seeing now many products starting to scale up more.
Speaker Change: Private payers one of them, which delinquency level is something that it's still a little bit more.
Speaker Change: In Nebraska to Seaway stabilizes.
Speaker Change: And then we have the unsecured products that are growing.
Speaker Change: It's more in the portfolio about gaining some participation like buy now pay later in between I think so when we combine that with the <unk>.
Speaker Change: We've been running for longer.
Speaker Change: We have stayed in India.
Speaker Change: <unk> equity and better than that.
Speaker Change: Mix will be there will be made driver off of that level off.
Speaker Change: Delinquency.
Speaker Change: But what we are trying to maximize as I was mentioning before is the evolution of the risk adjusted NIM ultimately what we are.
Speaker Change: The most of maximizing variable. So for example on private payroll.
Speaker Change: The raise that we're originating and even if there is some rate compression.
Speaker Change: Delinquency levels that are higher or much higher on the paralytic level.
Speaker Change: Payroll loans.
Speaker Change: We would have.
Speaker Change: And I could even if not an improvement in the risk adjusted NIM.
Speaker Change: So it's a mix.
Speaker Change: Okay.
Speaker Change: Question of the mix evolution through time that will.
Speaker Change: Defined with acid quite the half million.
And the <unk> side.
Joe Sunshine: No. Thanks, Thanks, Joe Sunshine.
Speaker Change: Our next question comes from Mr. Yuri Fernandes from Jpmorgan.
Speaker Change: Mr. Fernandez for now opening the audio so you can ask your questions live. Please go ahead Sir.
Speaker Change: Hi, Hello.
Speaker Change: <unk>.
Speaker Change: Good morning, I have also a question regarding asset quality, but now regarding stage is true.
Speaker Change: When we negotiate our stage two formation. It was it was great but it sure went up a lot driven by credit cards, basically and it was a migration from stage one into stage two.
Speaker Change: So if you can comment a little bit on.
Speaker Change: Regarding geeks is unique it is the worst and yes. It's call. It ahead like just trying to understand.
Speaker Change: Why there was an increase of <unk> <unk> and not only in <unk>, but also the coverage of stage four credit cards linked it down when we do like loan loss reserves.
Speaker Change: Bye Bye bye bye are balanced right you used to be high and wind down this parts of it so I would like to understand what happened here with stage on credit cards. Thank you.
Speaker Change: Hi, good morning, so on stage two.
Speaker Change: A consequence of the <unk>.
Speaker Change: 960 requirement.
Speaker Change: So.
Speaker Change: They had a re assignment from stage one to stage two loans that have a high.
Speaker Change: Higher probability of default and therefore, we assign them from stage one to stage two and nothing different in terms of performance or delinquency of the critical clients. If you look at the cohorts that we disclosed in the presentation, we see the new ones coming in.
Speaker Change: Strong levels in line with more recent quarters as well, but.
Speaker Change: Our requirement that the model.
Speaker Change: Now with the high point of the fault.
Speaker Change: Cohorts move to stage two.
Speaker Change: Data center and just on DS.
Speaker Change: On the resolution 40 96 weeks.
Speaker Change: Correct me, if I'm wrong here, but I understood from the past.
Speaker Change: That even you have Chuck counties right to have your account in Brazil.
Speaker Change: Your accounting under <unk> nine you are trying to keep boats, but we don't need to have like a different binding right. So you are implementing some updated Brazilian <unk> International I'll go first so it can have like more comparable.
Speaker Change: The reason why we see she is an aged show now like deep acted like just trying to understand because some investors. They ask us why you are being impacted by the Brazilian accounting changes.
Sometimes I am not sure about the reason why your comp issue.
Speaker Change: Yes. So we are we've been reporting in <unk> 2022.
Speaker Change: The 496 weeks.
Speaker Change: S eats that converts the local accounting towards <unk>, but he has certain minimums there.
Speaker Change: Im a region or different than the FRS and we need to comply with those.
Speaker Change: As we are.
Speaker Change: I'm going to say, it's a residual amount that needs to comply with it so.
Speaker Change: The impacts that we saw primarily when we mentioned the fifth differ ability of them.
Speaker Change: So in the end.
Speaker Change: Page two formation that we just spoke about.
Speaker Change: And then on the right. This was a big debate that.
Speaker Change: We've spoken with many we kept the 360 day period for the writers, but there was still slightly negative.
Speaker Change: With <unk> for more not.
Speaker Change: For comparison purposes, we decided to.
Speaker Change: <unk> seems to be the.
Speaker Change: When the.
Speaker Change: The 466 in both air France, nine and norms.
Speaker Change: No 10%. So you may say that maybe you are a little bit more conservatives and congrats.
Speaker Change: Keeping the write offs and <unk>.
Speaker Change: That's good for us here on when we analyze it.
Speaker Change: Yes, we believe it is more conservative than the comparison versus prior periods makes it easier and therefore, the model ability of being better.
Speaker Change: Its clean air M for investors and analysts. Thank you. Thank you.
Speaker Change: Our next question comes from Mr. Marco Ms Ricky from Bradesco <unk>.
Speaker Change: Mr. Marco Missouri, we are now opening the audio so you can ask your question lives.
Speaker Change: Please go ahead Sir.
Speaker Change: Hi, My name is much Hello, Ms <unk> from Bradesco <unk>.
Speaker Change: But to be honest, but talking about <unk>.
Speaker Change: So most of the questions was already answered so but the question is regarding the interest earning assets our data center portfolio up to private cloud we saw very good numbers so better.
Speaker Change: Higher interest, earning assets of course, thanks for the SaaS and additive, but looking for my question is.
Speaker Change: This interest earning assets compared to the total portfolio in your view guys. You will be the same or do you. So or you believe that there are current liabilities a little bit.
Speaker Change: And lower than the level that it was in this quarter.
Speaker Change: It's important to look for that during.
Speaker Change: During the strategy so looking for the strategy that the bank is is.
Speaker Change: He is on the credit card foreclose on the on the client. So if you guys believe that niche.
Speaker Change: Liabilities.
Speaker Change: Is recurrent thank you.
Speaker Change: Okay.
Hi, Marcel these changes speaking thank you for your question. So the dynamic that we saw on the credit card portfolio is exactly what we wanted so we want to increase the percentage of installments.
Speaker Change: In comparison to the to the revolving credit and debt increases either sterling and its a win win because in one sense we.
Speaker Change: We help clients get out of the problems that they may have in credit and in the other hand, we increased our our interest income which is important for the business as well. Another point. That's important is we lower the rates that customers space in comparison to revolving so revolting ourselves like rates.
Speaker Change: Amped up above 15%.
And then we reduce discount rates that could be starting at five 6%, so really helping clients.
Speaker Change: Improve their indebtedness if thats whats happening the goal is to keep increasing this part of the portfolio that has installments and we have.
Speaker Change: I hope a lot.
Speaker Change: <unk> pipeline of products that we're launching in order to help clients. So just to give you. An example last month, we launched a product called.
Speaker Change: Installments on the total debt as Youll know in Brazil, we have the installments without interest that people can can they.
Speaker Change: They go to their retail and make their purchases. So we're helping people with this product by organizing the number of installments theyre going to have and the size of the installments. So.
Speaker Change: Having good adoption there so and again, it's all about the strategy, we set a strategy to move our interest earnings from around 20, which is where we were to around 25 26, and we're going to fulfill these steps as we move along bringing more.
Speaker Change: Ego and ideally less delinquency, helping customers on a sustainable profit.
Marcelo: Thanks Marcelo.
Speaker Change: Thank you.
Speaker Change: Our next question comes from Ms <unk>.
Speaker Change: <unk> from HSBC.
Speaker Change: We're now opening the audience. So you can ask your question live. Please go ahead ma'am.
Speaker Change: Hi, Thank you for taking my question.
Speaker Change: Thanks, a lot.
Speaker Change: You mentioned youre launching.
Speaker Change: It's Scott.
Speaker Change: Yes Anthony.
Speaker Change: Adding stakes installments and the NPA.
Speaker Change: Did I hear that correctly.
Speaker Change: And.
Greg: Ryan This is Greg God why not let the current.
Speaker Change: Got you would expand Youre seeing there and then I'll ask a follow up then.
Speaker Change: I need a drumbeat towards speaking.
Speaker Change: Even though already that I love to say that we're really building this consumer finance to zero for our clients and for heater in a sense.
Speaker Change: And this card, which you called inter card because it is a 100% digital.
Speaker Change: Let's say credit card scheme and network I would say in a SaaS.
Speaker Change: Is to help us to foster more engagement with clients through our buy and operate here at into shop through the <unk> granted and other products that we're bringing to our ecosystem with.
Speaker Change: With that in place we can.
Speaker Change: This intermediate ether.
Speaker Change: Interchange fees that the networks charge the MTR, so theres a lot of technology behind that and again. The only reason why we can do that is because we have the clients.
Speaker Change: Okay buying products and by credit I would say in our platform.
Speaker Change: <unk>.
Speaker Change: <unk> to consumer approach.
Speaker Change: And we are going to call it inter card and.
Speaker Change: Believe that with the government basically be able to bring more activity more engagement from millions of clients that use our platform to be far big finance monopoly in her shopping and so on so that's the idea behind that we're very excited with this product.
Speaker Change: Okay. So this is essentially that it could be up to line of credit in the form of additional credit got Tonight.
Speaker Change: Exactly that's the debate.
Speaker Change: The man idea behind the launch of this product is a part of it is good also be offset by the lower expenses of operating the credit card issue would have to wait.
Other fees.
Speaker Change: That happened and I also saw.
Speaker Change: So that.
Speaker Change: 8% of the GSV on the platform was.
Speaker Change: And the NPL this quarter, that's a great number and I think there's a lot of potential there.
Speaker Change: Could you talk a bit more about that later.
Speaker Change: Seeing the NPS how are you choosing the customers.
Speaker Change: Industrial platforms, when we I don't think the NPA.
Speaker Change: What kind of rates you are charging.
Speaker Change: What kind of.
Speaker Change:
Speaker Change: Customer performance Athletic performance Jessica Fye.
Speaker Change: Those clients is that inducing more customers to come and shop RMB vishal in desktop platform or not thank you so much.
Speaker Change: The good thing about having our clients within our platform that we can control everything we can control very actively.
Speaker Change: The open to buy that they have the rates that they're going to charge the products that we want to offer them to buy depending on the take rate that we have so at the end of the day by not being there and we see as a very.
Speaker Change: Okay.
Speaker Change: Win win situation for our clients and for ourselves.
Speaker Change: I've always been vocal about this consumer finance 2.0, where we take all the intermediaries and we share the economics of scale with the client and then we'll keep her.
Speaker Change: Going on and we make this flywheel. So clients are returning more to the platform and regarding which clients do you offer that it's it depends on a lot of things we can offer our clients.
Speaker Change: And not have.
Speaker Change: A credit card limit approved the app our clients that they have.
Speaker Change: A specific credit card limit approved but they want to buy a larger item on our shopping and these items might have.
Speaker Change: Jus take rate first of all that's the kind of data that they're kind of off of inputs that you bring to the model.
Speaker Change: Proprietary.
Speaker Change: Underwriting model and who can do that.
Speaker Change: In real time, that's the benefit of combining data and combining the platform.
Speaker Change: Proving to shop.
Speaker Change: Yeah.
Speaker Change: Thank you so much.
Speaker Change: Thank you.
Our next question comes from Mr. Antonio <unk> from Bank of America, Mr. Brett. We're now opening the audio so you can ask your questions live. Please go ahead Sir.
Speaker Change: Hi, Thank you for all the time, so I would like to dive a bit deeper on nims again, so if you could explore a little bit more.
Speaker Change: Increase in your expectations for inquiries in terms of mix because they haven't all different trends in terms of payroll cards.
Speaker Change: Financing and also the use of excess liquidity so how.
Speaker Change: In short how do you expect mix, giving us forward and also what to expect in terms of repricing and use of excess liquidity. Thank you.
Speaker Change: Okay.
<unk> taken the.
Speaker Change: There are three driver in factors that I mentioned, so one is mix the island this increasing the yields.
Speaker Change: The within the products.
The last one is increasing the yield of the investment portfolio. So in mix and we continue to see higher than average growth in the beauty and home equity and now including with even the unsecured.
Speaker Change: <unk> also paid payroll within the unsecured the ones that are gaining share between announcing and.
Speaker Change: And buy now pay later.
Speaker Change: The trend should be roughly in line with what we've seen maybe the toughest one to model is payroll, but as Tim mentioned, we were seeing strong.
Speaker Change: Are there with that product.
Speaker Change: Within rates.
Speaker Change: The ones that are still with opportunity to continue to see increasing the yields.
Speaker Change: On the mortgages and public payroll that are running at rates that are lower.
Speaker Change: And then on top of that on credit cards. They saw identical to what we call the re profiling of.
Sanjay: Sanjay alluded to quest.
Sanjay: A question, which is we're trying to improve.
Sanjay: Improve.
Sanjay: Patients into it in these comments.
Sanjay: And then on the investment portfolio.
Sanjay: We did have a strong improvement in the average yields that we have.
Sanjay: Surpassing the 100%.
Sanjay: We're also optimizing the holding structure.
Sanjay: And the majority of that benefit in the effective tax rate. So it doesn't necessarily affect Indonesian based part of the capital allocation strategy and all of those together is what we've been seeing is that the risk adjusted NIM, which as I mentioned before is that when we're trying to maximize has been growing at an average of around 20 basis points per quarter.
Sanjay: We think that that to continue to be the case in the coming quarters, we'd be strategy continued to play out as we have been executing it.
Speaker Change: Okay. Thank you.
Speaker Change: Our next question comes from Mr. Daniele Vass from Safra.
Speaker Change: We're now opening the audience. So you can ask your question live Sir Please go ahead.
Yes, Hi, Hi, Josh any sense he happened to joy for the first time after the initiation of courage.
Speaker Change: I think most of the questions have been answered but.
Speaker Change: I'm trying to focus on the credit penetration improved meaningfully in the first quarter so could.
Speaker Change: Could you elaborate on what's driving that increase I know, it's a penetrating more credit but is it more.
Speaker Change: About activating our existing client base, some specific products or our new clients already joining with credit lines offered like upfront or any account changes that we should be aware of.
Speaker Change: Thank you.
Speaker Change: Hi, Danielle. Thank you for your question. So this has a lot to do with the overall strategy and also this what Raul mentioned earlier in the call about the secular shift that we're observing on and they either by design, so with products such as private payroll coming in.
Speaker Change: The expansion of <unk> loans, and everything that we're doing credit cards, we've been able to bring a lot more people to the base and increase credit penetration.
From a trend perspective, we'll have to work quarter after quarter and see where we get.
Speaker Change: But the effort that we're doing internally is to keep boosting credit penetration, which has a lot to do with what we've been building building right as most people know when we onboard clients just a small percentage of them get an automatic credit card limit for instance, but.
Do behavior and following this behavior, we give them a credit card limit and we start engaging them with this credit products. So that they can learn and we can grow so I'd say, it's it's Dave.
Speaker Change: This growth is by design.
Speaker Change: And we can expect to see more and more credit penetration within the client base as we move forward.
Daniel: Thank you Daniel.
Daniel: Thank you and congrats.
Daniel: This concludes our question and answer session I would like to give the floor back over to Mr. Joe why don't they terminate for his closing remarks.
Daniel: Okay.
Speaker Change: So everyone. Thanks again for listening to our earnings call.
Daniel: And just to summarize everything that we discuss here today, it's all about power Interbody designs, how do you envision 10 years ago to build this what I call a unique platform.
Daniel: Win win situations with the clients, reducing the debt the debt service.
Daniel: Digital first having this consumer finance 2.0 in place in order to optimize everything having disclosed sterilized portfolio with many products also still to come such as the digital receivables on the SME.
Daniel: The best funding class really 100% digital retailer oriented so we're really happy that it is well position, we prepare ourselves to be here today sharing not only the result for the quarter, but.
Daniel: I'll wrap thinking about what's ahead of us and we're very optimistic about the future.
Daniel: Therefore, I would like to thank for all the shareholders that have been supporting since we launched our digital freak.
Daniel: <unk> checking account in Brazil, and also of course, less mud pump lease or a margin of 4000 employees that things are that works everyday harder and harder to take us to the next step. Thank you very much.
Daniel: All of them and see you soon on our next earnings call. Thank you very much have a good day bye bye.
Daniel: This conference call is now concluded interest IR Department is at your disposal to answer any additional questions.
Daniel: You for attending today's presentation.
Daniel: This day.