Q2 2026 Banco Itau Chile Earnings Call

August 6, 2026

Speaker #1: Please enter the meeting passcode followed by pound. You have joined the meeting as an attendee and will be muted throughout the meeting.

Operator 2: Ladies and gentlemen, thank you for standing by and welcome to the Banco Itaú Chile Q2 2026 financial results conference call. This presentation and the earnings release are available on our investor relations website. During the company's presentation, all microphones will be disabled. Later, we will begin the Q&A session. To ask questions on audio, click on Raise Hand. Once called upon, you will receive a request to activate your microphone. Please activate it to ask the questions. For questions in writing, just queue the question in the Q&A button. Please be aware that your company's name should be visible for your question to be taken. I would now like to turn the conference over to Matías Valenzuela, Head of Planning and Corporate Strategy.

Operator: Ladies and gentlemen, thank you for standing by and welcome to the Banco Itaú Chile Q2 2026 financial results conference call. This presentation and the earnings release are available on our investor relations website. During the company's presentation, all microphones will be disabled. Later, we will begin the Q&A session. To ask questions on audio, click on Raise Hand. Once called upon, you will receive a request to activate your microphone. Please activate it to ask the questions. For questions in writing, just queue the question in the Q&A button. Please be aware that your company's name should be visible for your question to be taken. I would now like to turn the conference over to Matías Valenzuela, Head of Planning and Corporate Strategy.

Speaker #2: Ladies and gentlemen, thank you for standing by and welcome to the Banco Itaú Chile second quarter 26 financial results conference call. This presentation and the earnings release are available on our investor relations website.

Speaker #2: During the company's presentation, our microphone will be disabled. Later, we'll begin the Q&A session. To ask questions on audio, click on 'raise hand.' Once called upon, you'll receive a request to activate your microphone.

Speaker #2: Please activate it to ask the questions. For questions in writing, just cue the question in the Q&A button. Please be aware that your company's name should be visible for your question to be taken.

Speaker #2: I will now like to turn the conference over to Matias Venezuela, Head of Planning and Corporate Strategy.

Speaker #3: Good morning, everyone. And thank you for joining our second quarter earnings conference call. I would like to note that the voices used in this presentation were generated using artificial intelligence.

Matías Valenzuela: Good morning, everyone, and thank you for joining our Q2 earnings conference call. I would like to note that the voices used in this presentation were generated using artificial intelligence. My name is Matías Valenzuela, Head of Planning and Corporate Strategy at Itaú Chile. I am joined today by our CEO, André Gailey, our CFO, Emiliano Muratore, and our Chief Economist, Andrés Pérez. I would also like to remind you that this presentation may include forward-looking statements. Actual results may differ materially from those discussed. As always, we report under our managerial model, which reflects how we allocate capital, manage risk, and assess performance internally. This framework provides a transparent and consistent view of underlying earnings and aligns management decisions with shareholder value. For additional detail, please refer to our management commentary. With that, I will turn the presentation over to our CEO, André Gailey. Good morning, Andre.

Speaker #3: My name is Matias Valenzuela, Head of Planning and Corporate Strategy at Itaú Chile, and I am joined today by our CEO, Andre Gailey. Our CFO, Emiliano Muratore, and our Chief Economist, Andres Perez.

Speaker #3: I would also like to remind you that this presentation may include forward-looking statements. Actual results may differ materially from those discussed. As always, we report under our managerial model, which reflects how we allocate capital, manage risk, and assess performance internally.

Speaker #3: This framework provides a transparent and consistent view of underlying earnings and aligns management decisions with shareholder value. For additional detail, please refer to our management commentary.

Speaker #3: With that, I will turn the presentation over to our CEO, Andre Gailey. Good morning, Andre.

Speaker #4: Good morning, everyone, and thank you for joining us today. Let me begin with the key developments of the quarter. We maintained strong commercial momentum, with growth in both loans and deposits, outpacing the Chilean banking industry.

André Gailey: Good morning, everyone, and thank you for joining us today. Let me begin with the key developments of the quarter. We maintained strong commercial momentum with growth in both loans and deposits, outpacing the Chilean banking industry. This result underscores the resilience of our franchise, the strength of our client relationships, and our continued progress toward our strategic objectives. In Chile, improvements across our main revenue lines helped offset the more challenging conditions seen earlier in the year. At the consolidated level, Colombia's higher profitability made a meaningful contribution to our results. In June, we received approval from the competition authority for the acquisition of Klap, followed by approval from the CMF in July. We expect to begin consolidating the business during Q4 of this year.

Speaker #4: This result underscores the resilience of our franchise, the strength of our client relationships, and our continued progress toward our strategic objectives. In Chile, improvements across our main revenue lines helped offset the more challenging conditions seen earlier in the year.

Speaker #4: At the consolidated level, Colombia's higher profitability made a meaningful contribution to our results. In June, we received approval from the Competition Authority for the acquisition of Clap, followed by approval from the CMF in July.

Speaker #4: We expect to begin consolidating the business during the fourth quarter of this year. The acquisition will strengthen our payments and merchant acquiring capabilities. Broaden our presence across the merchant ecosystem and create new opportunities to deepen client relationships, generate fee income, and leverage transactional data to develop new financial solutions.

André Gailey: The acquisition will strengthen our payments and merchant acquiring capabilities, broaden our presence across the merchant ecosystem, and create new opportunities to deepen client relationships, generate fee income, and leverage transactional data to develop new financial solutions. We also completed the sale of our Colombian retail banking business to Banco de Bogotá. The divestment advances the strategic repositioning of our Colombian operation and supports a more focused business model centered on the segments where we have stronger competitive advantages and greater potential to generate sustainable returns. Finally, Extel once again ranked us first for best research team in Chile. Itaú BBA also secured the top position in both Latin American macro research and Latin American research. These recognitions underscore the quality of our teams, the depth of our analytical capabilities, and the value of the insights we provide to clients and investors across the region.

Speaker #4: We also completed the sale of our Colombian retail banking business to Banco de Bogotá. The divestment advances the strategic repositioning of our Colombian operation and supports a more focused business model centered on the segments where we have stronger competitive advantages and greater potential to generate sustainable returns.

Speaker #4: Finally, extel once again ranked us first for best research team in Chile. Itaú BBA also secured the top position in both Latin American macro research and Latin American research.

Speaker #4: These recognitions underscore the quality of our teams, the depth of our analytical capabilities, and the value of the insights we provide to clients and investors, across the region.

Speaker #4: Let me now turn to Colombia and provide more detail on the divestment of our retail banking business. Before the transaction, our Colombian retail business operated with a market share below 3%.

André Gailey: Let me now turn to Colombia and provide more detail on the divestment of our retail banking business. Before the transaction, our Colombian retail business operated with a market share below 3%. This limited scale constrained our ability to dilute costs, acquire clients efficiently, and generate returns in line with our cost of capital. Even under a reasonable operating scenario, we estimated that the previous business model would generate an ROE of between 5% and 10%, compared with a cost of capital of approximately 15%. Since announcing the agreement in December 2025, we have executed each stage according to plan. On 28 July 2026, we completed a capital increase of approximately $75 million in our Colombian operation. From a consolidated perspective, this represents an internal reallocation of capital rather than an additional economic cost for the group.

Speaker #4: This limited scale constrained our ability to dilute costs acquired clients' efficiently and generate returns in line with our cost of capital. Even under a reasonable operating scenario, we estimated that the previous business model would generate an ROE of between 5% and 10%, compared with a cost of capital of approximately 15%.

Speaker #4: Since announcing the agreement in December 2025, we have executed each stage according to plan. On July 28, we completed a capital increase of approximately 75 million US dollars in our Colombian operation.

Speaker #4: From a consolidated perspective, this represents an internal reallocation of capital rather than an additional economic cost for the group. In July, we also recognized approximately 158 million US dollars in non-recurring expenses associated with the transaction.

André Gailey: In July 2026, we also recognized approximately CLP 158 million in non-recurring expenses associated with the transaction. Effective 1 August 2026, approximately CLP 2,011 million in assets and CLP 1,499 million in liabilities were transferred at book value. As a result, we received approximately CLP 512 million in net cash proceeds, with no economic discount applied to the net assets transferred, while releasing close to CLP 1,185 million in risk-weighted assets. For the remainder of 2026, we expect to incur approximately CLP 18 million in additional non-recurring expenses, mainly related to completing the separation and transition activities. As part of the separation, Itaú Chile entered into a transition services agreement under which it will temporarily provide certain operational and support services through the end of 2026. This arrangement will ensure business continuity and facilitate an orderly migration following the transfer of the retail portfolio.

Speaker #4: Effective August 1, approximately 2,011 million US dollars in assets and 1,499 million US dollars in liabilities were transferred at book value. As a result, we received approximately 512 million US dollars in net cash proceeds, with no economic discount applied to the net assets transferred, while releasing close to 1,185 million US dollars in risk-weighted assets.

Speaker #4: For the remainder of 2026, we expect to incur approximately 18 million US dollars in additional non-recurring expenses, mainly related to completing the separation and transition activities.

Speaker #4: As part of the separation, Itaú entered into a transition services agreement under which it will temporarily provide certain operational and support services through the end of 2026.

Speaker #4: This arrangement will ensure business continuity and facilitate an orderly migration following the transfer of the retail portfolio. At the consolidated level, we expect the overall impact on our capital ratios to be virtually neutral, as the capital released through the asset transfer should offset the associated one-off charges.

André Gailey: At the consolidated level, we expect the overall impact on our capital ratios to be virtually neutral, as the capital released through the asset transfer should offset the associated one-off charges. The transaction creates value through three main channels. First, it reduces the capital allocated to a business generating returns structurally below our cost of capital. Second, it improves the expected return on the capital that remains invested in Colombia by concentrating resources on businesses where we have stronger capabilities and competitive advantages. Third, it increases our financial flexibility and strengthens the management of capital, liquidity, and balance sheet risk. From a balance sheet perspective, the divestment reduces structural mismatches by better aligning the duration and composition of our assets and liabilities. With the longer duration retail portfolio transferred, the remaining corporate loan book will have a shorter duration, allowing us to manage liquidity and interest rate exposure more efficiently.

Speaker #4: The transaction creates value through three main channels: first, it reduces the capital allocated to a business-generating return structurally below our cost of capital; second, it improves the expected return on the capital that remains invested in Colombia by concentrating resources on businesses where we have stronger capabilities and competitive advantages; third, it increases our financial flexibility and strengthens the management of capital liquidity and balance sheet risk.

Speaker #4: From a balance sheet perspective, the divestment reduces structural mismatches by better aligning the duration and composition of our assets and liabilities. With the longer duration retail portfolio transferred, the remaining corporate loan book will have a shorter duration, allowing us to manage liquidity and interest rate exposure more efficiently.

Speaker #4: Following the divestment, our Colombian operation will be focused on corporate banking and treasury. We expect the repositioned franchise to generate a ROE of between 10% and 15% by the end of 2028, supported by a more focused business model disciplined execution and more efficient capital allocation.

André Gailey: Following the divestment, our Colombian operation will be focused on corporate banking and treasury. We expect the repositioned franchise to generate a ROE of between 10% and 15% by the end of 2028, supported by a more focused business model, disciplined execution, and more efficient capital allocation. Under our current profitability assumptions, we estimate an economic payback period of approximately three to four years. Overall, this repositioning should result in a more focused, flexible, and structurally profitable Colombian franchise with a clearer path toward returns consistent with our cost of capital. With that, I will hand the floor to Andrés Pérez, who will walk us through the macroeconomic outlook for Chile and Colombia. Good morning, Andrés.

Speaker #4: Under our current profitability assumptions, we estimate an economic payback period of approximately 3 to 4 years. Overall, this repositioning should result in a more focused, flexible, and structurally profitable Colombian franchise, with a clearer path toward returns consistent with our cost of capital.

Speaker #4: With that, I will hand the floor to Andres Perez, who will walk us through the macroeconomic outlook for Chile and Colombia. Good morning, Andres.

Speaker #2: Good morning, Andre. Good morning, everyone. On this slide, I will provide a brief overview of Chile's recent economic performance and outlook. Economic activity remained weak during the second quarter, extending the softer momentum observed at the beginning of the year.

Andrés Pérez: Good morning, André. Good morning, everyone. On this slide, I will provide a brief overview of Chile's recent economic performance and outlook. Economic activity remained weak during the Q2, extending the softer momentum observed at the beginning of the year. The weakness reflected temporary disruptions in specific sectors, together with subdued credit growth, fragile labor demand, and weaker household confidence. Accordingly, our macro research team revised its GDP growth forecast to 1.3% for 2026. For 2027, growth is expected to accelerate to 2.8%, supported by a stronger investment cycle, elevated copper prices, and measures aimed at reducing barriers to private investment. Inflationary pressures increased toward the end of the quarter, with annual inflation reaching 4.3% in June. Recent currency depreciation and higher international oil prices have added to short-term risks, although weak domestic demand, labor market slack, and anchored inflation expectations should limit the persistence of these pressures.

Speaker #2: The weakness reflected temporary disruptions in specific sectors, together with subdued credit growth, fragile labor demand, and weaker household confidence. Accordingly, our macro research team revised its GDP growth forecast to 1.3% for 2026.

Speaker #2: For 2027, growth is expected to accelerate to 2.8%, supported by a stronger investment cycle elevated copper prices and measures aimed at reducing barriers to private investment.

Speaker #2: Inflationary pressures increased toward the end of the quarter, with annual inflation reaching 4.3% in June. Recent currency depreciation and higher international oil prices have added to short-term risks, although weak domestic demand, labor market slack, and anchored inflation expectations should limit the persistence of these pressures.

Speaker #2: Under this scenario, we expect inflation to end 2026 at 4.1% and converge to the central bank's 3% target during 2027. Against this mixed backdrop, we expect the central bank to maintain the monetary policy rate at 4.5% through 2026 and 2027.

Andrés Pérez: Under this scenario, we expect inflation to end 2026 at 4.1% and converge to the central bank's 3% target during 2027. Against this mixed backdrop, we expect the central bank to maintain the monetary policy rate at 4.5% through 2026 and 2027. This level allows the bank to balance renewed inflation risks against still weak activity while retaining a data-dependent approach to future decisions. On the currency front, we forecast the Chilean peso at approximately CLP 900 per USD at the end of 2026 and CLP 880 at the end of 2027. The currency may continue to face pressure from narrow interest rate differentials with the United States and swings in global risk aversion. Even so, strong copper prices and a sizable trade surplus provide an important external buffer.

Speaker #2: This level allows the bank to balance renewed inflation risks against still weak activity, while retaining a data-dependent approach to future decisions. On the currency front, we forecast the Chilean peso at approximately 900 Chilean pesos per US dollar at the end of 2026 and 880 Chilean pesos at the end of 2027.

Speaker #2: The currency may continue to face pressure from narrow interest rate differentials with the United States, and swings in global risk aversion. Even so, strong copper prices and a sizable trade surplus provide an important external buffer.

Speaker #2: In summary, the Chilean economy continues to face a demanding near-term environment, characterized by weak activity and renewed inflationary pressure. At the same time, stronger investment fundamentals and progress on pro-growth reforms support a more constructive medium-term outlook.

Andrés Pérez: In summary, the Chilean economy continues to face a demanding near-term environment characterized by weak activity and renewed inflationary pressure. At the same time, stronger investment fundamentals and progress on pro-growth reforms support a more constructive medium-term outlook. Turning now to Colombia. Economic activity was stronger than expected during the Q2, supported by resilient domestic demand, services, and manufacturing. Consumer confidence reached its highest level in a decade, while retail sales, imports, and consumer lending continued to show solid momentum. Consequently, our macro research team revised its 2026 GDP growth forecast upward to 2.5% from 2.3%. For 2027, growth is expected to moderate slightly to 2.3%, reflecting tighter financial conditions and a gradual deceleration in activity during the H2 of this year. Despite the stronger activity, the inflation outlook remains challenging.

Speaker #2: Turning now to Colombia. Economic activity was stronger than expected during the second quarter, supported by resilient domestic demand, services, and manufacturing. Consumer confidence reached its highest level in a decade, while retail sales, imports, and consumer lending continued to show solid momentum.

Speaker #2: Consequently, our macro research team revised its 2026 GDP growth forecast upward to 2.5% from 2.3%. For 2027, growth is expected to moderate slightly to 2.3%, reflecting tighter financial conditions and a gradual deceleration in activity during the second half of this year.

Speaker #2: Despite the stronger activity, the inflation outlook remains challenging. Annual inflation reached 6.1% in June and is expected to rise further, ending 2026 at approximately 7.5%, mainly due to persistent services inflation and higher food and energy prices associated with El Niño.

Andrés Pérez: Annual inflation reached 6.1% in June and is expected to rise further, ending 2026 at approximately 7.5%, mainly due to persistent services inflation and higher food and energy prices associated with El Niño. Inflation is then expected to gradually decline to 5.8% in 2027, remaining above the Central Bank's 3% target. This backdrop implies that monetary policy will remain restrictive for longer. Following the 75 basis point increase in June, which brought the policy rate to 12%, we expect BANREP to continue tightening and reach a terminal rate of 13% during 2026. Although risks lean toward a lower terminal rate. A gradual easing cycle is expected thereafter, with the policy rate declining to approximately 11.5% by the end of 2027. For the Colombian peso, we forecast an exchange rate of approximately 3,400 Colombian pesos per US dollar at the end of both 2026 and 2027.

Speaker #2: Inflation is then expected to gradually decline to 5.8% in 2027, remaining above the central bank's 3% target. This backdrop implies that monetary policy will remain restrictive for longer.

Speaker #2: Following the 75 basis point increase in June, which brought the policy rate to 12%, we expect Banrep to continue tightening and reach a terminal rate of 13% during 2026, although risks lean toward a lower terminal rate.

Speaker #2: A gradual easing cycle is expected thereafter, with the policy rate declining to approximately 11.5% by the end of 2027. For the Colombian peso, we forecast an exchange rate of approximately 3,400 Colombian pesos per US dollar at the end of both 2026 and 2027.

Speaker #2: The recent appreciation has been supported by high interest rate differentials and a decline in the country's risk premium. Even so, fiscal execution remains an important variable to monitor, as the incoming administration begins implementing its consolidation strategy.

Andrés Pérez: Even so, fiscal execution remains an important variable to monitor as the incoming administration begins implementing its consolidation strategy. In summary, Colombia combines stronger than expected economic activity with persistent inflationary pressures and restrictive monetary conditions. This environment reinforces the importance of disciplined risk management and supports our strategic focus on more resilient and capital-efficient businesses in the country. Emiliano Muratore, our CFO, will now continue the presentation. Good morning, Emiliano.

Speaker #2: In summary, Colombia combines stronger-than-expected economic activity with persistent inflationary pressures and restrictive monetary conditions. This environment reinforces the importance of disciplined risk management and supports our strategic focus on more resilient and capital-efficient businesses in the country.

Speaker #1: Emiliano Muratore, our CFO, will now continue the presentation. Good morning, Emiliano.

Speaker #3: Thank you, Andres. . And good morning, everyone. I would like to begin with a few highlights in digital innovation, culture, and market recognition. Starting with digital innovation, we continued to enhance the client experience through new capabilities.

Emiliano Muratore: Thank you, Andrés, and good morning, everyone. I would like to begin with a few highlights in digital innovation, culture, and market recognition. Starting with digital innovation, we continue to enhance the client experience through new capabilities. For individual clients, we introduced voice-activated bank transfers in our app, making everyday transactions simpler, faster, and more intuitive. We also launched the new Itaú Empresas app, providing corporate clients with a simpler, faster, and more secure experience together with enhanced self-service capabilities. Culture remains a fundamental enabler of our strategy. For the third consecutive year, Itaú Chile was recognized as one of the best places to work for LGBTI+ talent by Equidad CL, Pride Connection, and the Human Rights Campaign. In addition, employee satisfaction reached 85% in June 2026.

Speaker #3: For individual clients, we introduced voice-activated bank transfers in our app, making everyday transactions simpler, faster, and more intuitive. We also launched the new Itaú Empresas app, providing corporate clients with a simpler, faster, and more secure experience—together with enhanced self-service capabilities.

Speaker #3: Culture remains a fundamental enabler of our strategy. For the third consecutive year, Itaú Chile was recognized as one of the best places to work for LGBTI+ talent by Equidad CL, Pride Connection, and the Human Rights Campaign.

Speaker #3: In addition, employee satisfaction reached 85% in June 2026. This achievement reflects a highly engaged and inclusive organization, which is essential for attracting talent, executing our strategy, and consistently delivering a better also advanced our sustainable finance agenda by completing a $30 million sustainability-linked loan with Caja Los Andes.

Emiliano Muratore: These achievements reflect a highly engaged and inclusive organization, which is essential for attracting talent, executing our strategy, and consistently delivering a better client experience. We also advanced our sustainable finance agenda by completing a CLP 30 million sustainability-linked loan with Caja Los Andes. The transaction reinforces our commitment to supporting clients in achieving their sustainability goals and demonstrates our ability to deliver financial solutions linked to measurable targets. The market also recognized the strength of our businesses and teams during the quarter. Euromoney named us Chile's best investment bank for DCM. While our asset management subsidiaries received three awards at the 2026 Premios Salmón. As André noted, Extel ranked us first for best research team in Chile, while Itaú BBA secured the top position in both Latin American macro research and Latin American research.

Speaker #3: The transaction reinforces our commitment to supporting clients in achieving their sustainability goals and demonstrates our ability to deliver financial solutions linked to measurable targets.

Speaker #3: The market also recognized the strength of our businesses and teams during the quarter. Euromoney named us Chile's best investment bank for DCM, while our asset management subsidiaries received 3 awards at the 2026 Premios Salmón.

Speaker #3: As Andre noted, Extel ranked us first for best research team in Chile, while Itaú BBA secured the top position in both Latin American macro research and Latin American research.

Speaker #3: Together, these recognitions highlight the quality of our advisory capabilities, the depth of our market expertise, and the value we provide to clients and investors.

Emiliano Muratore: Together, these recognitions highlight the quality of our advisory capabilities, the depth of our market expertise, and the value we provide to clients and investors. Turning now to loan growth in Chile. Our loan portfolio expanded 9.6% year on year and 2.4% quarter on quarter, clearly outperforming the banking industry, which grew 4.3% over the last 12 months. This result was also above our full year guidance range of 6% to 8%. Growth continued to be led by our commercial and mortgage portfolios, reflecting the strength of our franchise and disciplined commercial execution. We achieved this while maintaining a selective approach to origination and consistent risk control, despite a still demanding macroeconomic environment. Looking at the segment breakdown. In commercial lending, the portfolio grew 9.5% year on year and 2.2% quarter on quarter, compared with industry growth of 3% year on year.

Speaker #3: Turning now to loan growth in Chile. Our loan portfolio expanded 9.6% year-on-year and 2.4% quarter-on-quarter, clearly outperforming the banking industry, which grew 4.3% over the last 12 months.

Speaker #3: This result was also above our full-year guidance range of 6% to 8%. Growth continued to be led by our commercial and mortgage portfolios, reflecting the strength of our franchise and disciplined commercial execution.

Speaker #3: We achieved this while maintaining a selective approach to origination and consistent risk control. Despite a still demanding macroeconomic environment. Looking at the segment breakdown.

Speaker #3: In commercial lending, the portfolio grew 9.5% year-on-year and 2.2% quarter-on-quarter, compared with industry growth of 3% year-on-year. This was the third consecutive quarter in which we outperformed the industry on both a year-on-year and quarter-on-quarter basis, supported by stronger client activity, sustained origination, and deeper relationships across our target segments.

Emiliano Muratore: This was the third consecutive quarter in which we outperformed the industry on both a year-on-year and quarter-on-quarter basis, supported by stronger client activity, sustained origination, and deeper relationships across our target segments. In consumer loans, the portfolio grew 0.5% year on year but declined 2.3% quarter on quarter. This reflects our continued selectivity in the segment, prioritizing risk-adjusted returns and portfolio quality over volume growth. Even so, new money origination continued to expand while the portfolio mix improved as we reduced exposure to refinanced and renegotiated loans. In mortgages, we maintained our leadership position with growth of 12.6% year on year and 4.3% quarter on quarter, significantly above the industry's 5.7% annual expansion.

Speaker #3: In consumer loans, the portfolio grew 0.5% year-on-year but declined 2.3% quarter-on-quarter. This reflects our continued selectivity in the segment, prioritizing risk-adjusted returns and portfolio quality over volume growth.

Speaker #3: Even so, new money origination continued to expand, while the portfolio mix improved as we reduced exposure to refinanced and renegotiated loans. In mortgages, we maintained our leadership position, with growth of 12.6% year-on-year and 4.3% quarter-on-quarter.

Speaker #3: Significantly above the industry's 5.7% annual expansion. This growth increased our market share by 56 basis points over the last 12 months, reaching 9.1% and reinforced our position as one of the strongest-performing banks in the segment.

Emiliano Muratore: This growth increased our market share by 56 basis points over the last 12 months, reaching 9.1%, and reinforced our position as one of the strongest performing banks in the segment, supported by our mortgage value proposition and high participation in the Fondo de Garantías Especiales program. Turning now to our funding base and assets under management. On the funding side, deposit growth remained strong. Deposits continue to be a central pillar of our strategy and an important driver of deeper client relationships. In Chile, demand deposits grew 12.8% year on year, significantly outperforming both the banking system, which expanded 7.1%, and our peer group, which grew 6.1%. This positioned us as the leading bank within our peer group in demand deposit growth over both the last three and 12 months, reflecting continued progress in our principality strategy. Growth was broad-based across client segments.

Speaker #3: Supported by our mortgage value proposition and high participation in the Fondo de Garantías Especiales program. Turning now to our funding base and assets under management.

Speaker #3: On the funding side, deposit growth remained strong. Deposits continued to be a central pillar of our strategy, and an important driver of deeper client relationships.

Speaker #3: In Chile, demand deposits grew 12.8% year-over-year, significantly outperforming both the banking system, which expanded 7.1%, and our peer group, which grew 6.1%. This positioned us as the leading bank within our peer group in demand deposit growth over both the last 3 and 12 months, reflecting continued progress in our principality strategy.

Speaker #3: Growth was broad-based across client segments, demand deposits from individuals increased 5.9% year-on-year above the system's 3% growth, while deposits from companies expanded 16.7%, well above the industry's 9.2%.

Emiliano Muratore: Demand deposits from individuals increased 5.9% year on year above the system's 3% growth, while deposits from companies expanded 16.7%, well above the industry's 9.2%. Time deposits rose 15.5% year on year compared with 4.3% for the system. This result reflects our disciplined funding strategy and ability to maintain a balanced and diversified deposit mix. Assets under management increased 12.0% year on year, supported by sustained net inflows and favorable commercial activity. We also continued to diversify our funding sources and expand our access to international markets. During the quarter, we completed our first international public bond issuance under our MTN program, denominated in Swiss francs. The issuance broadened our global investor base, provided access to a new currency and market, and increased the flexibility and resilience of our funding structure. The next slide summarizes our main performance indicators for the quarter.

Speaker #3: Time deposits rose 15.5% year-on-year, compared with 4.3% for the system. This result reflects our disciplined funding strategy and ability to maintain a balanced and diversified deposit mix.

Speaker #3: Assets under management increased 12.0% year-on-year, supported by sustained net inflows and favorable commercial activity. We also continued to diversify our funding sources and expand our access to international markets.

Speaker #3: During the quarter, we completed our first international public bond issuance under our MTN program, denominated in Swiss francs. The issuance broadened our global investor base, provided access to a new currency and market, and increased the flexibility and resilience of our funding structure.

Speaker #3: The next slide summarizes our main performance indicators for the quarter. Our consolidated loan portfolio reached CLP 30.8 trillion, up 3.4% quarter-over-quarter and 11.3% compared with the second quarter of 2025.

Emiliano Muratore: Our consolidated loan portfolio reached CLP 30.8 trillion, up 3.4% quarter-over-quarter and 11.3% compared with Q2 2025. In Chile, loans totaled CLP 25.2 trillion, increasing 2.4% quarter-over-quarter and 9.6% year-over-year, reflecting continued commercial momentum across our portfolios. Consolidated financial margin with clients reached CLP 335.7 billion, increasing 5.8% quarter-over-quarter, while in Chile it rose 3.5% to CLP 254.3 billion. Commissions and fees increased 19.1% quarter-over-quarter at the consolidated level and 17.1% in Chile. Cost of credit remained broadly stable. At the consolidated level, it decreased 0.6% to CLP 75.0 billion, while in Chile it increased slightly by 0.8% to CLP 58.4 billion. Consolidated recurring net income reached CLP 108.9 billion, increasing 42.1% quarter-over-quarter and 10.3% year-over-year.

Speaker #3: In Chile loans totaled 25.2 trillion Chilean pesos, increasing 2.4% quarter over quarter and 9.6% year-over-year, reflecting continued commercial momentum across our portfolios. Consolidated financial margin with clients reached 335.7 billion Chilean pesos, increasing 5.8% quarter over quarter, while in Chile it rose 3.5% to 254.3 billion Chilean pesos.

Speaker #3: Commissions and fees increased 19.1% quarter over quarter at the consolidated level, and 17.1% in Chile. Cost of credit remained broadly stable, at the consolidated level it decreased 0.6% to 75.0 billion Chilean pesos, while in Chile it increased slightly by 0.8% to 58.4 billion Chilean pesos.

Speaker #3: Consolidated recurring net income reached CLP 108.9 billion, increasing 42.1% quarter over quarter and 10.3% year over year. In Chile, recurring net income rose 25.0% to CLP 89.4 billion. This drove recurring return on tangible equity up by 3.4 percentage points to 11.4% at the consolidated level and by 2.5 percentage points to 11.6% in Chile.

Emiliano Muratore: In Chile, recurring net income rose 25.0% to CLP 89.4 billion. This drove recurring return on tangible equity up by 3.4 percentage points to 11.4% at the consolidated level and by 2.5 percentage points to 11.6% in Chile, reflecting stronger earnings momentum during the quarter. Turning to financial margin with clients in Chile, it increased 3.5% quarter-over-quarter to CLP 254.3 billion. Although it declined 3.2% year-over-year, resulting in a net financial margin with clients of 3.2% for the period. The decline in the margin rate also reflected the increase in available-for-sale securities during the quarter, which diluted the ratio despite the recovery in nominal client-related revenues. The quarterly improvement was driven mainly by higher average loan volumes and wider spreads in the corporate segment.

Speaker #3: Reflecting stronger earnings momentum during the quarter. Turning to financial margin with clients in Chile, it increased 3.5% quarter-over-quarter to CLP 254.3 billion, although it declined 3.2% year-over-year, resulting in a net financial margin with clients of 3.2% for the period.

Speaker #3: The decline in the margin rate also reflected the increase in available for sale securities during the quarter, which diluted the ratio despite the recovery in nominal client-related revenues.

Speaker #3: The quarterly improvement was driven mainly by higher average loan volumes and wider spreads in the corporate segment. The funding mix also contributed positively, supported by growth in demand deposits, while derivatives management and client FX transactions delivered solid results.

Emiliano Muratore: The funding mix also contributed positively, supported by growth in demand deposits, while derivatives management and client FX transactions delivered solid results. The year-on-year decline was primarily explained by narrower loan spreads and the lower average monetary policy rate. These pressures were partly offset by stronger derivatives and FX activity with clients. Taken together, the quarter showed a recovery in client-related revenues, supported by stronger commercial activity and a more favorable funding mix. Even so, margins remain below the levels recorded in the same period last year. Turning to financial margin with the market, the result remained negative at CLP 2.4 billion, but improved materially from the CLP 8.9 billion loss recorded in Q1. Throughout H1, the banking book delivered consistent results reflecting disciplined management of our fixed income positions. However, this positive contribution was more than offset by trading performance.

Speaker #3: The year-on-year decline was primarily explained by narrower loan spreads and the lower average monetary policy rate. These pressures were partly offset by stronger derivatives and FX activity with clients.

Speaker #3: Taken together, the quarter showed a recovery in client-related revenues, supported by stronger commercial activity and a more favorable funding mix. Even so, margins remained below the levels recorded in the same period last year.

Speaker #3: Turning to financial margin with the market, the result remained negative, at 2.4 billion Chilean pesos, but improved materially from the 8.9 billion Chilean pesos loss recorded in the first quarter.

Speaker #3: Throughout the first half of the year, the banking book delivered consistent results, reflecting disciplined management of our fixed income positions. However, this positive contribution was more than offset by trading performance.

Speaker #3: Which continued to be affected by a volatile market environment. For the second half of the year, we expect the banking book to remain a stable contributor.

Emiliano Muratore: Which continue to be affected by a volatile market environment. For H2, we expect the banking book to remain a stable contributor. Our priority will be to restore profitability in trading while maintaining disciplined risk management. Turning now to commissions and fees. Fee income reached CLP 49.6 billion in Q2, increasing 17.1% quarter-over-quarter and 3.6% year-over-year. The recovery was broad-based and supported by stronger commercial activity across most of our key businesses. Insurance brokerage revenues increased 47.5% quarter-over-quarter, driven by higher income from consumer credit-related insurance. Fees from credit operations and guarantees grew 5.3%, supported by stronger trade finance activity and greater momentum in the commercial segment. Financial advisory and other fees increased 18.4%, reflecting higher transaction activity and improved credit card revenues.

Speaker #3: Our priority will be to restore profitability in trading, while maintaining disciplined risk management. Turning now to commissions and fees, fee income reached 49.6 billion Chilean pesos in the second quarter, increasing 17.1% quarter over quarter and 3.6% year-over-year.

Speaker #3: The recovery was broad-based and supported by stronger commercial activity across most of our key businesses. Insurance brokerage revenues increased 47.5% quarter-over-quarter, driven by higher income from consumer credit-related insurance.

Speaker #3: Fees from credit operations and guarantees grew 5.3%, supported by stronger trade finance activity and greater momentum in the commercial segment. Financial advisory and other fees increased 18.4%, reflecting higher transaction activity and improved credit card revenues.

Emiliano Muratore: Asset management fees rose 6.4% quarter over quarter and 18.7% year over year, supported by growth in assets under management. Commissions therefore represented 16.4% of operating revenues during the quarter, up from 15.2% in Q1. This higher contribution supports a more diversified revenue mix and reflects continued progress in deepening client relationships across our businesses. Turning to cost of credit, it totaled CLP 58.4 billion in Q2, remaining broadly stable quarter over quarter and declining 11.3% year over year. The cost of credit ratio remained at 1.0% at the lower end of our guidance range. The quarterly evolution reflected higher provisioning associated with stronger loan growth in Itaú Corporate. This was partially offset by lower provisions related to rating adjustments and changes in collateral, together with solid recoveries from sustained collection efforts. Asset quality indicators remained controlled.

Speaker #3: Asset management fees rose 6.4% quarter over quarter and 18.7% year over year, supported by growth in assets under management. Commissions therefore represented 16.4% of operating revenues during the quarter, up from 15.2% in the first quarter.

Speaker #3: This higher contribution supports a more diversified revenue mix and reflects continued progress in deepening client relationships across our businesses. Turning to cost of credit, it totaled 58.4 billion Chilean pesos in the second quarter, remaining broadly stable quarter over quarter and declining 11.3% year-over-year.

Speaker #3: The cost of credit ratio remained at 1.0%, at the lower end of our guidance range. The quarterly evolution reflected higher provisioning associated with stronger loan growth in Itaú Corporate.

Speaker #3: This was partially offset by lower provisions related to rating adjustments and changes in collateral, together with solid recoveries from sustained collection efforts. Asset quality indicators remained controlled.

Speaker #3: The total NPL ratio closed the quarter at 1.9%, broadly stable and below the level recorded one year ago. Consumer NPLs increased moderately due to higher short-term delinquency, but the portfolio continues to show a structurally improved risk profile, supported by a healthier client mix and lower levels of refinanced and renegotiated loans.

Emiliano Muratore: The total NPL ratio closed the quarter at 1.9%, broadly stable and below the level recorded one year ago. Consumer NPLs increased moderately due to higher short-term delinquency, but the portfolio continues to show a structurally improved risk profile, supported by a healthier client mix and lower levels of refinanced and renegotiated loans. Commercial NPLs continued to improve while the mortgage delinquency ratio remained stable despite the strong growth of the portfolio. Finally, the NPL coverage ratio increased to 139%, reinforcing the strength of our provisioning position. Turning now to non-interest expenses. Non-interest expenses totaled CLP 140.4 billion in Q2, increasing 4.3% quarter over quarter and 5.0% year over year. Personnel expenses increased 3.2% quarter over quarter, mainly due to higher severance costs associated with headcount reductions, performance bonuses, and inflation adjustments.

Speaker #3: Commercial NPLs continued to improve, while the mortgage delinquency ratio remained stable despite the strong growth of the portfolio. Finally, the NPL coverage ratio increased to 139%, reinforcing the strength of our provisioning position.

Speaker #3: Turning now to non-interest expenses, non-interest expenses totaled CLP 140.4 billion in the second quarter, increasing 4.3% quarter over quarter and 5.0% year over year. Personnel expenses increased 3.2% quarter over quarter, mainly due to higher severance costs associated with headcount reductions, performance bonuses, and inflation adjustments.

Speaker #3: Year-over-year, the increase primarily reflected higher expenses related to our long-term incentive program, driven by the higher average share price during the period. Administrative expenses rose 6.1% quarter-over-quarter, driven by higher advisory and consulting expenses, IT and telecommunications costs, and operational losses.

Emiliano Muratore: Year over year, the increase primarily reflected higher expenses related to our long-term incentive program, driven by the higher average share price during the period. Administrative expenses rose 6.1% quarter over quarter, driven by higher advisory and consulting expenses, IT and telecommunications costs, and operational losses. Year over year, the more moderate increase of 1.6% mainly reflected higher marketing expenses, operational losses, and IT-related services. Revenue growth outpaced the increase in expenses during the quarter, driving a 168 basis point sequential improvement in our efficiency ratio to 46.6%. We remain focused on disciplined cost management and structural efficiency while continuing to invest selectively in technology and the capabilities needed to support our growth strategy. Turning to Colombia, our operation delivered a significant improvement in Q2. On a constant currency basis, total financial margin reached CLP 104.4 billion, up from CLP 85.9 billion in the previous quarter.

Speaker #3: Year-over-year, the more moderate increase of 1.6% mainly reflected higher marketing expenses, operational losses, and IT-related services. Revenue growth outpaced the increase in expenses during the quarter, driving a 168-basis-point sequential improvement in our efficiency ratio to 46.6%.

Speaker #3: We remain focused on disciplined cost management and structural efficiency, while continuing to invest selectively in technology and the capabilities needed to support our growth strategy.

Speaker #3: Turning to Colombia, our operation delivered a significant improvement in the second quarter. On a constant currency basis, total financial margin reached CLP 104.4 billion, up from CLP 85.9 billion in the previous quarter.

Speaker #3: The result was supported by financial margin with clients of CLP 86.5 billion and a strong CLP 18.9 billion contribution from financial margin with the market.

Emiliano Muratore: The result was supported by financial margin with clients of CLP 86.5 billion and a strong CLP 18.9 billion contribution from financial margin with the market. Commissions and fees rose to CLP 11.1 billion, supported by stronger advisory activity during the quarter. Higher revenues and disciplined cost management drove the efficiency ratio down to 53.5%, its lowest quarterly level in recent periods and a significant improvement from 64.4% in Q1. This translated into recurring net income of CLP 20.4 billion, up from CLP 5.1 billion in the previous quarter. Recurring ROE reached 10.6%, reflecting a significant improvement in the profitability of our Colombian operation. Turning now to slide 16. Our capital position remains strong, supported by disciplined capital management and consistent earnings generation.

Speaker #3: Commissions and fees rose to CLP 11.1 billion, supported by stronger advisory activity during the quarter. Higher revenues and disciplined cost management drove the efficiency ratio down to 53.5%, its lowest quarterly level in recent periods and a significant improvement from 64.4% in the first quarter.

Speaker #3: This translated into recurring net income of CLP 20.4 billion, up from CLP 5.1 billion in the previous quarter. Recurring ROE reached 10.6%, reflecting a significant improvement in the profitability of our Colombian operation.

Speaker #3: Turning now to slide 16, our capital position remains strong, supported by disciplined capital management and consistent earnings generation. As of June, our CET-1 ratio stood at 11.5%, following the payment in April of dividends equivalent to 60% of 2025 net income.

Emiliano Muratore: As of June, our CET1 ratio stood at 11.5%, following the payment in April of dividends equivalent to 60% of 2025 net income. Even after the distribution, our capital ratios remained within the bank's risk appetite. Our CET1 ratio also remained above the 11.2% median of our peers, leaving sufficient capacity to support sustainable business growth and execute our strategic priorities. In July, the CMF issued a second draft regulation for public consultation, proposing changes to the methodology for measuring market risk-weighted assets. Based on the regulators' estimates, these changes could reduce market risk-weighted assets across the Chilean banking system by up to 36%. While the ultimate impact will depend on the final regulation and each bank's portfolio composition, the proposal could improve capital efficiency across the Chilean banking system. Turning now to the performance of Itaú Chile's stock.

Speaker #3: Even after the distribution, our capital ratios remained within the bank's risk appetite. Our CET1 ratio also remained above the 11.2% median of our peers, leaving sufficient capacity to support sustainable business growth and execute our strategic priorities.

Speaker #3: In July, the CMF issued a second draft regulation for public consultation, proposing changes to the methodology for measuring market risk-weighted assets. Based on the regulator's estimates, these changes could reduce market risk-weighted assets across the Chilean banking system by up to 36%.

Speaker #3: While the ultimate impact will depend on the final regulation and each bank's portfolio composition, the proposal could improve capital efficiency across the Chilean banking system.

Speaker #3: Turning now to the performance of Itaú Chile's stock. Over the last 12 months, our shares delivered a cumulative return of 63.4%, outperforming both the 52.9% weighted average return of our peers and the 34.6% return of the IPSA.

Emiliano Muratore: Over the last 12 months, our shares delivered a cumulative return of 63.4%, outperforming both the 52.9% weighted average return of our peers and the 34.6% return of the IPSA. The share price increased from CLP 12,900 at the end of June 2025 to CLP 21,000 as of 31 July 2026. Over the same period, our price to tangible book value multiple expanded from approximately 0.8 times to 1.2 times, reflecting growing market recognition of our progress in profitability, capital discipline, and strategic execution. We also broadened our sell side coverage with Bank of America initiating research coverage of our shares. The addition should further increase the visibility of our investment proposition, deepen engagement with investors, and support the liquidity of our shares. On the final slide, let's review our performance against our 2026 guidance for Chile.

Speaker #3: The share price increased from 12,900 Chilean pesos at the end of June 2025 to 21,000 Chilean pesos as of July 31, 2026. Over the same period, our price-to-tangible book value multiple expanded from approximately 0.8 times to 1.2 times, reflecting growing market recognition of our progress in profitability, capital discipline, and strategic execution.

Speaker #3: We also broadened our sell-side coverage, with Bank of America initiating research coverage of our shares. This addition should further increase the visibility of our investment proposition, deepen engagement with investors, and support the liquidity of our shares.

Speaker #3: On the final slide, let's review our performance against our 2026 guidance for Chile. Loans grew 9.6% year over year as of June, above our 6% to 8% guidance range and reflecting sustained commercial momentum across our priority portfolios.

Emiliano Muratore: Loans grew 9.6% year-over-year as of June, above our 6% to 8% guidance range and reflecting sustained commercial momentum across our priority portfolios. The average financial margin with clients stood at 3.2%, slightly below our guidance range of 3.3% to 3.5%, mainly reflecting the lower interest rate environment and pressure on lending spreads during the H1 of the year. The sequential improvement observed in the Q2, together with a more favorable outlook for spreads, supports better prospects for the H2. Commissions and fees grew 3.3% year to date, remaining below our full year guidance of 12% to 14%. However, the 17.1% quarterly recovery reflects stronger commercial activity and improved momentum across our main fee-generating businesses. Looking ahead, we have a robust pipeline for the H2 of the year, although execution will depend largely on market conditions and transaction timing.

Speaker #3: The average financial margin with clients stood at 3.2%, slightly below our guidance range of 3.3% to 3.5%. Mainly reflecting the lower interest rate environment and pressure on lending spreads during the first half of the year.

Speaker #3: The sequential improvement observed in the second quarter together with a more favorable outlook for spreads, supports better prospects for the second half. Commissions and fees grew 3.3% year to date, remaining below our full-year guidance of 12% to 14%.

Speaker #3: However, the 17.1% quarterly recovery reflects stronger commercial activity and improved momentum across our main, fee-generating businesses. Looking ahead, we have a robust pipeline for the second half of the year, although execution will depend largely on market conditions and transaction timing.

Speaker #3: Cost of credit remained well controlled at 1.0%, in line with sound asset quality and disciplined risk management. Non-interest expenses increased 2.8% year-to-date, above our guidance of approximately 2%, mainly reflecting specific personnel and administrative items.

Emiliano Muratore: Cost of credit remained well controlled at 1.0%, in line with guidance and supported by sound asset quality and disciplined risk management. Non-interest expenses increased 2.8% year to date above our guidance of approximately 2%, mainly reflecting specific personnel and administrative items. Looking ahead, we expect the expense base to remain well controlled through year-end, with full year growth ending in line with our guidance. Our managerial effective tax rate stood at 14.9%, broadly in line with our guidance of approximately 15%. Our managerial tax guidance excludes any potential effects from the proposed reduction in the corporate income tax rate, including the resulting remeasurement of deferred tax assets. If the legislation is enacted under the terms currently proposed, we estimate a non-recurring impact of approximately CLP 30 billion to 40 billion. Finally, ROTCE reached 10.4%, below our 12% to 13% guidance range.

Speaker #3: Looking ahead, we expect the expense base to remain well controlled through year-end, with full-year growth ending in line with our guidance. Our managerial effective tax rate stood at 14.9%, broadly in line with our guidance of approximately 15%.

Speaker #3: Our managerial tax guidance excludes any potential effects from the proposed reduction in the corporate income tax rate, including the resulting remeasurement of deferred tax assets.

Speaker #3: If the legislation is enacted under the terms currently proposed, we estimate a non-recurring impact of approximately 30 billion to 40 billion Chilean pesos.

Speaker #3: Finally, ROTE reached 10.4%, below our 12% to 13% guidance range. Although first-half profitability was affected by the challenging market environment and pressure on the financial margin.

Emiliano Muratore: Although H1 profitability was affected by the challenging market environment and pressure on financial margin, the recovery in revenues and earnings during Q2 provides positive momentum as we enter the H2 of the year. To conclude, Q2 delivered solid business growth, a meaningful recovery in earnings, and continued progress across our strategic priorities. We enter the H2 of the year with a stronger franchise, a sound capital and funding position, and confidence in our ability to continue generating sustainable value for our clients, employees, and shareholders. This concludes today's presentation. Thank you for your attention and continued trust in Itaú Chile. We will now be happy to take your questions.

Speaker #3: The recovery in revenues and earnings during the second quarter provides positive momentum as we enter the second half of the year. To conclude, the second quarter delivered solid business growth, a meaningful recovery in earnings, and continued progress across our strategic priorities.

Speaker #3: We enter the second half of the year with a stronger franchise, a sound capital and funding position, and confidence in our ability to continue generating sustainable value for our clients, employees, and shareholders.

Speaker #3: This concludes today's presentation. Thank you for your attention and continued trust in Itaú Chile. We will now be happy to take your questions.

Operator 2: To ask questions on audio, click on Raise Hand. Once called upon, you'll receive a request to activate your microphone. Please activate it to ask the questions. For questions in writing, just queue the question in the Q&A button. Please be aware that your company's name should be visible for your question to be taken. Please wait as we compile the questions. Our first question comes from Ernesto Gabilondo with Bank of America. Your microphone is open

Operator: To ask questions on audio, click on Raise Hand. Once called upon, you'll receive a request to activate your microphone. Please activate it to ask the questions. For questions in writing, just queue the question in the Q&A button. Please be aware that your company's name should be visible for your question to be taken. Please wait as we compile the questions. Our first question comes from Ernesto Gabilondo with Bank of America. Your microphone is open

Speaker #1: To ask questions on audio, click on raise hand. Once called upon, you'll receive a request to activate your microphone. Please activate it to ask the questions.

Speaker #1: For questions in writing, just queue the question in the Q&A button. Please be aware that your company's name should be visible for your question to be taken.

Speaker #1: Please wait as we compile the questions. Our first question comes from Ernesto Gabilondo with Bank of America. Your microphone is open.

Ernesto Gabilondo: Thank you. Thank you, Matías. Hi, good morning, André, Emiliano, and Andrés. Thanks for the opportunity to ask questions and congrats on your results. My first question is on the tax reform. If we assume a normalized inflation of 3% over the next years, how should we think about the evolution of your effective tax rate with this new tax reform? My second question is on your return on tangible expectations for the year. As you pointed out, you're still expecting something around 12% to 13% for the year. The return on tangible equity stood at 10% in the H1. Just wondering what will be the drivers to reach your guidance. How comfortable do you think it could be, I don't know, between the low and the high end of the range?

Speaker #2: Thank you. Thank you, Matias. Hi, good morning, Andre, Emiliano, and Andres. And thanks for the opportunity to ask questions and congrats on your results.

Speaker #2: My first question is on the tax reform. So, if we assume a normalized inflation of 3% over the next years, how should we think about the evolution of your effective tax rate with this new tax reform?

Speaker #2: And my second question is on your return on tangible expectations for the year. As you pointed out, you still expecting something around 12 to 13% for the year.

Speaker #2: The return on tangible equity stood at 10% in the first half. So just wondering what will be the drivers to reach your guidance. How comfortable do you think it could be?

Speaker #2: I'm not sure whether it will be at the low or high end of the range. Also, after the completion of the sale of the Colombian retail banking business, how do you see that helping to improve return on tangible equity on a consolidated basis?

Ernesto Gabilondo: Also after the completion of the sale of the Colombian retail banking business, how do you see that helping to improve the sustainable return on tangible equity on a consolidated basis? I know you are guiding that you are currently in Colombia at a 5% and that it could go in the next 3 or 4 years to a much higher ROE. On a consolidated basis, how should we think about that helping you to think about your long-term return on tangible equity? Thank you.

Speaker #2: I know you're guiding that you're currently in Colombia at a 5% and that it could go in the next three or four years to a much higher ROE.

Speaker #2: But on a consolidated basis, how should we think about that helping you to think about your long-term return on tangible equity? Thank you.

Emiliano Muratore: Hello, can you hear me, Ernesto?

Speaker #3: Hello. Can you hear me, Ernesto?

Speaker #2: Yes. Perfect.

Ernesto Gabilondo: Yes, perfect.

Speaker #3: Yes. All right. Hello. This is Emiliano. Thank you for your question. First, regarding effective tax rate for 2027, as you pointed out, so inflation going down would take the effective tax rate up.

Emiliano Muratore: Yes. Hi. Hello. This is Emiliano. Thank you for your question. First, regarding effective tax rate for 2027, as you pointed out, inflation going down would take the effective tax rate up. Now with the fiscal reform or the reform that the government is passing in Congress, that should tend to balance out and to have more like a flat effect on effective tax rate with the reform balancing out the decrease in inflation. It's also worth noting that this year we have the negative effect on deferred tax assets of the reform that we estimate to be between CLP 30 billion to 40 billion in tax for 2026. It will be like a one-off, then we'll benefit from the lower taxes going forward. As you must know, it's a gradual reduction from 27% to 23% in three years.

Speaker #3: But now, with the fiscal reform or the reform that the government is passing in Congress, that should tend to balance out. And to have more like a flat effect on effective tax rate with the reform balancing out the decrease in inflation.

Speaker #3: It's also worth noting that this year, we have the negative effect on deferred tax assets. So the reform that we estimate to be between 30 to 40 billion pesos in tax for 2026, it will be like a one-off.

Speaker #3: And then we'll benefit from the lower taxes going forward. And, as you must know, it's a gradual reduction from 27% to 23% over three years.

Emiliano Muratore: At the end, definitely a net positive for the bank going forward with this one-off effect in 2026. Regarding the driver for H2 ROE, I would say the main driver is financial margin with the market kind of normalizing to a more long-term level. That should take us to as of now, we give the 12% to 13% range. It will depend on how it evolves during the months to see how higher or lower we are within the range. We keep the 12% to 13% range as of now. You can kind of take a midpoint, the best guess today, still some months to go to see how high or low we are. Regarding Colombia, I know, André, if you want to comment.

Speaker #3: So at the end, definitely a net positive for the bank going forward. But with this one-off effect in 2026. Regarding the drivers for second half ROE, I would say at the main driver is financial margin with the market kind of normalizing to a more long-term level.

Speaker #3: And that should take us to as of now, we keep the 12 to 13% range. I mean, it will depend on how it evolves during the months to see how higher or lower we are within the range.

Speaker #3: But we keep the 12% to 13% range as of now. So you can kind of take a midpoint, the best guess today. But still, some months to go and to see how higher or low we are.

Speaker #3: And regarding Colombia, I know, Andre, if you want to comment.

Speaker #4: Well, the overall impact on the bank's ROE will depend on the size of Colombia. With the elections in Colombia, we expect the opportunity to grow the operation there.

André Gailey: The overall impact on the bank's ROE will depend on the size of Colombia. With the elections in Colombia, we expect the opportunity to grow the operation there. We also have the challenge to reduce our costs and to reach a better efficiency ratio in Colombia. It will be a gradual process. Looking at a longer term, that will help Chile and Colombia, the consolidated, to have an ROE that we expect to be above the 15% consolidated ROE, in line or above.

Speaker #4: We also have the challenge to reduce our costs and to reach a better efficiency ratio in Colombia. It will be a gradual process. But looking at the longer term, that will help Chile and Colombia, consolidated, to have an ROE that we expect to be above the 15% consolidated ROE, in line with or above our goals.

Speaker #2: Excellent. Now, this is super helpful. Thank you very much, Andre and Emiliano.

Ernesto Gabilondo: Excellent. No, this is super helpful. Thank you very much, André and Emiliano.

Operator 2: Our next question comes from Alonso Aramburu with BTG. Your microphone is open.

Operator: Our next question comes from Alonso Aramburu with BTG. Your microphone is open.

Speaker #1: Our next question comes from Alonso Aramburu with BTG. Your microphone is open.

Speaker #3: Yes. Hi. Thank you for the call. Good morning. Just wanted to follow up on the comment regarding Colombia. And your guidance for 2028 of 10 to 15% ROE.

Alonso Aramburu: Yes. Hi. Thank you for the call. Good morning. Just wanted to follow up on the comments regarding Colombia and your guidance for 2028 of 10% to 15% ROE. Just wanted to see if you can give us some color on how to bridge where you are today to that 10% to 15%. How should we think about the H2 of this year, let's say, excluding the one-off expenses and 2027? Is this a transition in which you go to from, let's say, five to 10 or to seven, eight, and then to the low teens? What's delaying this improvement for a couple of years? I guess you mentioned this efficiency issue. Is that what's delaying this improvement to be quicker in the results? Thank you.

Speaker #3: Just wanted to see if you can give us some color how to bridge where you are today to that 10 to 15%. So how should we think about the second half of this year, let's say, excluding the one-off expenses and 2027?

Speaker #3: Is this a transition in which you go to from, let's say, 5 to 10 or to 7, 8, and then to the low teens?

Speaker #3: And what's delaying this improvement for a couple of years? I guess you mentioned this efficiency issue. Is that what's delaying this improvement, to be quicker in the results?

Speaker #3: Thank you.

Speaker #4: All right. The two main drivers, as I mentioned, is the scale and efficiency. The first is to grow the portfolio and we believe that Colombia has a positive trend over the next years.

André Gailey: Hi. The two main drivers, as I mentioned, is the scale and efficiency. The first is to grow the portfolio. We believe that Colombia has a positive trend over the next years. We, as a niche corporate and market actor will be able to grow above the market, and that will allow us to dilute the current cost structure that we have. On the other hand, even though we made significant efficiencies and are making during 2026, we will have additional efficiencies to be made during 2027 and 2028. That will help us both by growing revenues and by reducing costs to increase our utilities and during those two years, to grow our ROE consistently. That's the main plan. I think that when we look at the variables, I think everything is in place for us to follow that path.

Speaker #4: And we as a niche corporate and market actor will be able to grow above the market. And that will allow us to dilute the current cost structure that we have.

Speaker #4: On the other hand, even though we made significant efficiencies and are making more during 2026, we will have additional efficiencies to be made during 2027 and 2028.

Speaker #4: So that will help us both by growing revenues and by reducing costs, to increase our utilities and, during those two years, to grow our ROE consistently.

Speaker #4: So that's the main plan. I think that when we look at the variables, everything is in place for us to follow that path.

Alonso Aramburu: Okay. Thank you. Is it fair to say that the profitability of the business following the divestment of these assets and liabilities, loans and deposits, is already more profitable, or it's still a similar profitability to what you had in the last couple of quarters, what you have today in Colombia?

Speaker #3: Okay, thank you. But is it fair to say that the profitability of the business, following the divestment of these assets and liabilities, loans, and deposits, is already more profitable?

Speaker #3: Or is it still a similar profitability to what you had in the last couple of quarters? What do you have today in Colombia?

André Gailey: The current corporate operation in Colombia is already above our cost of equity. The problem is that we have now to dilute all the other costs that are now borne only by the corporate transaction, the corporate operation. We believe that over time, we'll be able to grow and dilute costs, and that will help us to quickly reach the ROEs we mentioned before.

Speaker #4: The current corporate operation in Colombia is already above our cost of equity. The problem is that we have now to dilute all the other costs that are now born only by the corporate transaction, the corporate operation.

Speaker #4: So we believe that, over time, we'll be able to grow and dilute costs, and that will help us to quickly reach the ROEs we mentioned before.

Speaker #3: Okay. Thank you.

Alonso Aramburu: Okay. Thank you.

Speaker #1: Our next question comes from Daniel Mora with Credicorp. Your microphone is open.

Operator 2: Our next question comes from Daniel Mora with Credicorp. Your microphone is open.

Operator: Our next question comes from Daniel Mora with Credicorp. Your microphone is open.

Daniel Mora: Hi. Good morning. Thank you for the presentation. I have a couple of questions. The first one is very simple regarding the Colombian operation. Do we expect additional non-recurring expenses in 2027, or all the non-recurring expenses will be executed in this year, in 2026? That will be my first question. The second question, it's regarding fees. Observing that the fees have been below guidance, what will be the drivers that you expect to improve the net fee growth in Chile in the H2 of this year? Do you expect insurance brokerage and also financial advisory to keep the positive momentum that we observe in the Q2? Thank you so much.

Speaker #5: Hi. Good morning. Thank you for the presentation. I have a couple of questions. The first one is very simple regarding the Colombian operation. Do we expect additional non-recurring expenses in 2027?

Speaker #5: Will all the non-recurring expenses be executed this year, or in 2026? That will be my first question. And the second question is regarding fees—I have observed that the fees have been below guidance.

Speaker #5: What will be the drivers that you expect to improve the net fee growth in Chile in the second half of this year? Do you expect insurance, brokerage, and also financial advisory to keep the positive momentum that we observed in the second quarter?

Speaker #5: Thank you so much.

André Gailey: Hello, Daniel. Thank you for your questions. First, regarding non-recurring in Colombia, basically, no. We don't expect any further non-recurring beyond 2026. All the non-recurring will be recorded, most of them already in July and the rest in the coming months of 2026, but no further non-recurring for the future. Regarding fees, I would say basically two drivers. First, advisory fees. All the corporate finance, M&A, DCM pipeline is very strong, even though it hasn't already been reflected in the actual results in the H1, but we do have a good pipeline and execution, and that will be one of the main growth H2 compared to H1. The economic activity in the country gaining momentum in terms of consumption, employment, and all that.

Speaker #6: Hello, Daniel. Thank you for your question. First, regarding non-recurring in Colombia, basically, no. I mean, we don't expect any further non-recurring beyond 2026. So all the non-recurring will be recorded most of them already in July and the rest in the coming months of 2026.

Speaker #6: But no further non-recurring for the future. And regarding fees, I would say that basically two drivers. First, advisory fees. I mean, all the corporate finance, M&A, DCM, pipeline is very strong, even though it hasn't already been reflected in the actual results in the first half.

Speaker #6: But we do have a good pipeline and execution. And that will be one of the main growth second half compared to first half. And then the economic activity in the country gaining momentum in terms of consumption, employment, and all that that is basically what we are assuming in the GDP growth prospect for the year, being one of the drivers too.

André Gailey: That is basically what we are assuming in the GDP growth prospect for the year being one of the drivers, too. The number of clients is also picking up. All the investment we are doing in brand and in marketing is impacting our ability to increase the number of clients. Basically, I would say that those three drivers, advisory fees significantly higher in the H2 with good visibility of that in the pipeline we have. Second, economic activity supporting consumption and economic activity in general. Third, the good growth in the number of clients going forward.

Speaker #6: The number of clients is also picking up. I mean, all the investment we are doing in brand and in marketing is impacting our ability to increase the number of clients.

Speaker #6: So basically, I would say that those three drivers—advisory fees—are significantly higher in the second half, with good visibility of that in the pipeline we have.

Speaker #6: Second, economic activity supporting consumption and economic activity in general. And third, a good growth in the number of clients going forward.

Speaker #5: Perfect, thank you. Very clear. Just one last question regarding fees: the insurance brokerage that we observed in the second quarter, did it present any non-recurring positive effect?

Daniel Mora: Perfect. Thank you. Very clear. Just one last question regarding fees. The insurance brokerage that we observe in Q2 presented any non-recurring positive effect, or should we expect this line to continue presenting the results that you already present in Q2?

Speaker #5: Or should we expect this line to continue presenting the results that you already presented in the second quarter?

André Gailey: Yes. There was around CLP 3.5 billion one-off effect regarding the model we have for provisioning the fees we charge when we grant a loan and then some of them, we need to pay them back when the client prepays the loans, or it basically enters into restructuring. There's an actuarial model. There was a recalibration of that model in the

Speaker #6: Yeah. There was around like a 3.5 billion pesos one-off effect regarding the model we have for provisioning the fees we grant when the fees we charge when we grant the loan.

Speaker #6: And then, some of them, we need to pay back when the client prepays the loans or basically enters into restructuring. So there's an actuarial model. There was a recalibration of that model in the second quarter that basically implied like CLP 3.5 billion of mean. Without that, we were more in the mid-single-digit growth.

Emiliano Muratore: Said in Q2 that basically implied like CLP 3.5 billion of better fees for the quarter. Without that, we were more in the mid-single-digit growth. That's the level when we see picking up more closer to double digits going forward.

Speaker #6: And that's the level we see picking up more, closer to double digits going forward.

Speaker #5: Okay. Perfect. Thank you so much. Very clear.

Daniel Mora: Okay, perfect. Thank you so much. Very clear.

Speaker #1: Our next question comes from Yuri Fernandez with JPMorgan. Your microphone is open.

Operator 2: Our next question comes from Yuri Fernandes with J.P. Morgan. Your microphone is open.

Operator: Our next question comes from Yuri Fernandes with J.P. Morgan. Your microphone is open.

Yuri Fernandes: Hi. Hey, everybody. Good morning. Good afternoon. Thank you for the opportunity of asking questions. I have one regarding margins. The spreads from clients in Chile, it is tracking below your guidance. Just checking if you believe you can go to the guidance here. Q2 is kind of the inflection point, and things should improve. Any view on, and again, this is not the market NII, just the client NII that has been tracking lighter. I have a second one regarding your cost of risk, right? This is on track, this is doing fine, but we note some higher NPLs on consumers in Chile. Just checking if given the economic outlook should be better, if you are also comfortable with your cost of risk guidance. Thank you.

Speaker #7: Hi. Hey, everybody. Good morning, good afternoon. Thank you for the opportunity to ask questions. I have one regarding margins. The spread from clients in Chile is tracking below your guidance.

Speaker #7: Just checking if you believe you can go to the guidance here second Q is kind of the inflection point and things should improve. So any view on and again, this is not the market NII, just the client NII that has been tracking lighter.

Speaker #7: And then I have a second one regarding your cost of risk, right? Because this is on track. This is doing fine. But we note some higher NPLs on consumers in Chile.

Speaker #7: So just checking if given the economic outlook should be better, if you're also comfortable with your cost of risk guidance. Thank you.

Emiliano Muratore: Hi, Yuri. Thank you for your question. Starting with the second one. Yes, we are pretty comfortable with the guidance in cost of risk. All the work we have been doing in the consumer portfolio, reducing the restructure and refinance is basically showing in the cost of risk numbers, and we are confident with the 1 to 1.1 and maybe even targeting the lower part of the range. We are confident, and as you said, and even this with the economic activity and GDP growth, we have been seeing that it has been softer than expected, but going forward should be a tailwind for cost of risk. Yes, we are comfortable with that. In terms of clients NIM, basically what we took us below our range in the H1 is the competitive environment, especially in commercial lending, where we have seen a strong competitive pressure.

Speaker #6: Hi, Yuri. Thank you for your question. I mean, starting with the second one, yes, I mean, we are pretty comfortable with the guidance in cost of risk.

Speaker #6: I mean, all the work we have been doing in the consumer portfolio, reducing the restructure and refinance is basically showing in the cost of risk numbers and we are confident with the one to 1.1 and maybe even targeting the lower part of the range.

Speaker #6: So we are confident. And as you said, even with the economic activity and GDP growth we have been seeing, it has been softer than expected.

Speaker #6: But going forward, this should be a tailwind for the cost of risk. So yes, we are comfortable with that. And in terms of clients, NIM, basically what we took as below our range in the first half is the competitive environment, especially in commercial lending, where we have seen strong competitive pressure going forward.

Emiliano Muratore: Going forward, we expect to be within the range, closer to the bottom part of the range for the year. Because as I said before, the base case scenario for us is that economic activity will rebound starting from the Q3, and that should take out part of the competitive pressure we are experiencing now. Second, because all the growth we are seeing in checking accounts and demand deposits also should help us on the cost of fund of clients, and that should take us to the range, even though closer to the lower part of that range for the full year.

Speaker #6: We expect to be within the range closer to the bottom part of the range for the year, basically because as I said before, the base case scenario for us is that the economic activity will rebound third quarter.

Speaker #6: And that should take out part of the competitive pressure we are experiencing now. Second, because all the growth we are seeing in checking accounts and demand deposits should also help us with the cost of funds for clients.

Speaker #6: And that should take us to the range, even though closer to the lower part of the range for the full year.

Yuri Fernandes: Oh, super clear. Thank you very much.

Speaker #5: Oh, super clear. Thank you very much.

Operator 2: Once again, to ask questions on audio, please click on Raise Hand. For questions in writing, just queue the question in the Q&A button. Please be aware that your company's name should be visible for your question to be taken. Please wait as we compile the questions.

Operator: Once again, to ask questions on audio, please click on Raise Hand. For questions in writing, just queue the question in the Q&A button. Please be aware that your company's name should be visible for your question to be taken. Please wait as we compile the questions.

Speaker #1: Once again, to ask questions on audio, please click on raise hand. For questions in writing, just keep the question in the Q&A button. Please be aware that your company's name should be visible for your question to be taken.

Speaker #1: Please wait as we compile the questions.

Emiliano Muratore: Yes. There's a question from Antonio Yanez regarding how the non-recurring cost of the Colombia transaction would affect dividends. As we pointed out before the transaction, in terms of capital ratio, the transaction in Colombia, it's kind of neutral because even though we have a lower net income, we also are reducing the risk-weighted assets. Basically, the transaction as a whole doesn't affect our capacity to pay dividend as a dividend per share on a dividend per share basis. What it implies is that the payout ratio on the basically all-in net income should be significantly higher, and to have a payout on the recurring part in line with the 50% to 60% that we paid last year.

Speaker #6: Yes. There is a question from Antonio Yáñez regarding how the non-recurring cost of the Colombia transaction would affect dividends. I mean, as we pointed out before the transaction, in terms of capital ratio, the transaction in Colombia, it's kind of neutral because even though we have a lower net income, we also are reducing the risk-weighted assets.

Speaker #6: So basically, the transaction as a whole doesn't affect our capacity to pay dividend as a dividend per share on a dividend per share basis.

Speaker #6: What it implies is that the payout ratio on the basically all-in net income should be significantly higher and to have a payout on the recurrent part in line with the 50 to 60 percent that we pay the last year.

Operator 2: Our next question is also from Daniel Valenas, it's the following: Given the retail plus retail fees, would you no longer record from day one while the OpEx reduction should be gradual? Should we expect negative earnings from Colombia in 2027 as a transition year?

Operator: Our next question is also from Daniel Valenas, it's the following: Given the retail plus retail fees, would you no longer record from day one while the OpEx reduction should be gradual? Should we expect negative earnings from Colombia in 2027 as a transition year?

Speaker #1: Our next question is also from Danielle Valenas. And it's the following: Given the retail plus retail fees, would you no longer record from day one, while the OPEX reduction should be gradual?

Speaker #1: Should we expect negative earnings from Colombia in 2027 as a transition year?

Emiliano Muratore: I'm not sure if I understood the question. Let me read. First, there's a question regarding the impact in July in terms of P&L. Basically, all of it, the CLP 160 million, is impacting P&L in July. The capital injection is kind of indirectly related to the transaction because it has nothing to do with the P&L impact of the transaction. As I said before, the P&L impact is counterbalanced by the reduction in risk-weighted assets, but we do execute the capital injections to support the growth of the business going forward in the new corporate segments. That's why the capital injection was executed.

Speaker #6: I'm not sure if I understood the question. Let me read it. So first, there's a question regarding the impact in July in terms of P&L.

Speaker #6: Basically, all of it, the 160 million dollars, it's impacting P&L in July. The capital injection is kind of indirectly related to the transaction because it hasn't to do with the P&L impact of the transaction because as I said before, the P&L impact is counterbalanced by the reduction in risk-weighted assets.

Speaker #6: But we do executed the capital injections to support the growth of the business going forward in the new corporate segments. And that's why the capital injection was executed.

Emiliano Muratore: The OpEx reduction for Colombia, I would say that even though there is a gradual transition in terms of efficiency cost, efficiency ratio, as Andrés mentioned before, in general, let's say just the one-off we are paying now in July will affect cost immediately starting in August. There is some further efficiency to capture during the next 12 to 18 months, but the most of it will impact immediately.

Speaker #6: And the OPEX reduction for Colombia, I would say that even though there is a gradual transition in terms of cost efficiency—cost efficiency ratio, as Andres mentioned before—in general, let's say just the one-off we are paying now in July will affect costs immediately starting in August.

Speaker #6: And there is some further efficiency to capture during the next 12 to 18 months. But the most of it will impact immediately.

Operator 2: Once again, to ask questions on audio, click on Raise Hand. For questions in writing, just queue the question in the Q&A button. Please wait as we compile the questions. Thank you. This concludes today's presentation. You may disconnect now, and have a very nice day. Goodbye

Operator: Once again, to ask questions on audio, click on Raise Hand. For questions in writing, just queue the question in the Q&A button. Please wait as we compile the questions. Thank you. This concludes today's presentation. You may disconnect now, and have a very nice day. Goodbye

Speaker #1: Once again, to ask questions on audio, click on raise hand. For questions in writing, just keep the question in the Q&A button. Please wait as we compile the questions.

Speaker #1: Thank you. This concludes today's presentation. You may disconnect now and have a very nice day.

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Q2 2026 Banco Itau Chile Earnings Call

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