Macro Bank Q4 2024 Earnings Report

Macro Bank EPS Results

• Actual EPS: N/A
• Consensus EPS: $2.41
• Beat/Miss: N/A
• One Year Ago EPS: N/A

Macro Bank Revenue Results

• Actual Revenue: N/A
• Expected Revenue: $830.64 billion
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Macro Bank Announcement Details

• Quarter: Q4 2024
• Date: 4/2/2025
• Time: Before Market Opens
• Conference Call Date: N/A
• Conference Call Time: N/A

Banco Macro S.A., operating under the Macro Bank (NYSE:BMA) name and listed on the New York Stock Exchange under the symbol BMA, is an Argentine financial institution serving individuals, small and medium-sized businesses, corporations and public-sector customers. The bank provides a broad range of banking and financial services through its branch network and digital channels.

Its products and services include personal and commercial loans, checking and savings accounts, time deposits, credit and debit cards, foreign-exchange services, payment solutions, insurance and investment products. Banco Macro also offers financing and transactional services designed to support businesses and regional economic activity in Argentina.

The company traces its origins to 1976, when it began operating as a financial company, and became a commercial bank in 1988. Over time, Banco Macro expanded its presence through acquisitions of provincial banking operations and developed a nationwide network, with a particular focus on serving customers outside Argentina’s largest metropolitan centers.

Macro Bank Q4 2024 Earnings Call Transcript

Key Takeaways

• Banco Macro reported 4Q24 net income of ARS 102.2 billion, up 4% quarter-on-quarter, while FY24 net income fell about 70% year-on-year to ARS 325.1 billion due to lower interest and government securities income.
• The bank’s loan portfolio reached ARS 5.8 trillion in 4Q24, rising 18% QoQ and 45% YoY, led by personal loans and credit cards, with private-sector loan market share at 8.3%.
• Total deposits stood at ARS 8.4 trillion, down 3% QoQ but up 15% YoY, driven by a 2% increase in private-sector balances, and transactional accounts now represent about 65% of the mix.
• Asset quality remained under control with a 1.28% NPL ratio and 159% coverage; provisions rose to ARS 37.5 billion in the quarter, and cost of risk is expected to be 2–2.5% in 2025.
• With capital ratios of 32.4% (CAR) and 31.6% (Tier 1), the bank plans 60% real loan growth and 35% deposit growth in 2025, aiming for a 12–15% ROE amid ~25% inflation and an end-year FX rate of ARS 1,250/USD.

Presentation

[Operator]

Good morning, ladies and gentlemen, and thank you for waiting. At this time, we would like to welcome everyone to Banco Macro's 4Q 2024 Earnings Conference Call. We would like to inform you that the 4Q 2024 press release is available to download at the investor relations website of Banco Macro, www.macro.com.ar/relaciones-inversores. Also, this event is being recorded, and all participants will be in listen-only mode during the company's presentation. After the company's remarks are completed, there will be a Q&A session. At that time, further instructions will be given. Should any participant need assistance during this call, please press star zero to signal the operator. It is now my pleasure to introduce our speakers. Joining us from Argentina are Mr. Jorge Scarinci, Chief Financial Officer, and Mr. Nicolás Torres, IR. Now, I will turn the conference over to Mr. Nicolás Torres. You may begin your conference, sir.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

Thank you. Good morning and welcome to Banco Macro's Fourth Quarter 2024 Conference Call. Any comments we may make today may include forward-looking statements, which are subject to various conditions, and these are outlined in our 20-F, which was filed to the SEC, and it's available at our website. Fourth quarter 2024 press release was distributed yesterday, and it's available at our website. All figures are in Argentine pesos and have been restated in terms of the measuring unit current at the end of the reporting period. As of 2020, the bank began reporting results applying hyperinflation accounting in accordance with IFRS IAS 29, as established by the Central Bank of Argentina. For ease of comparison, figures of previous quarters have been restated applying IAS 29 to reflect the accumulated effect of the inflation adjustment for each period through December 31st, 2024.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

I will now briefly comment on the bank's fourth quarter 2024 financial results. In the fourth quarter of 2024, Banco Macro's net income totaled ARS 102.2 billion. This result was 4% or ARS 3.5 billion higher than in the third quarter of 2024. As of the fourth quarter of 2024, this result was mainly driven by lower net interest income, higher net income, higher net income from financial assets and liabilities for fair value through profit or loss, and a lower result from the net monetary position, as inflation is during the quarter. The accumulated annualized return on average equity and the accumulated annualized return on average assets were 7.5 and 2.4, respectively. In fiscal year 2024, net income totaled ARS 325.1 billion, 74% lower than in fiscal year 2023. Total comprehensive income totaled ARS 227.7 billion and was 83% lower than in fiscal year 2023.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

In the fourth quarter of 2024, operating income before general administrative and personal expenses totaled ARS 813.9 billion, 9% or ARS 81.9 billion lower than in the third quarter of 2024 due to lower income from interest on government securities. On a yearly basis, this result decreased 72% or ARS 2.1 trillion. In fiscal year 2024, net operating income before general administrative and personal expenses totaled ARS 4.6 trillion, 26% lower than in fiscal year 2023. In the fourth quarter of 2024, provision for loan losses totaled ARS 37.5 billion, 51% or ARS 12.7 billion higher than in the third quarter of 2024. On a yearly basis, provision for loan losses increased 5% or ARS 2.1 billion. In fiscal year 2024, provision for loan losses totaled ARS 109.4 billion and were 9% higher than in fiscal year 2023.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

In the quarter, net interest income totaled ARS 532.6 billion, 13% or ARS 82.2 billion lower than in the third quarter of 2024, and 33% or ARS 132.6 billion higher year-on-year. This result is due to a 12% decrease in interest income and an 8% decrease in interest expenses, and a 32% decrease in income from interest from government securities. In fiscal year 2024, net interest income totaled ARS 1.6 trillion and was 10% lower than in fiscal year 2023. Interest income decreased 34% while interest expenses decreased 46%. In the fourth quarter of 2024, interest income totaled ARS 819.1 billion, 12% or ARS 107.3 billion lower than in the third quarter of 2024, and 34% or ARS 429.3 billion lower than in the fourth quarter of 2023. In fiscal year 2024, interest income totaled ARS 3.5 trillion, 34% lower than in fiscal year 2023.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

Income from interest on loans and other financing totaled ARS 499.9 billion, 14% or ARS 62 billion higher compared with the previous quarter, mainly due to a 16% increase in the average volume of private sector loans, which was partially offset by a 102 basis points decrease in the average lending rate. On a yearly basis, income from interest on loans decreased 39% or ARS 326.4 billion, and in fiscal year 2024, income from interest on loans and other financing totaled ARS 2.1 trillion, 15% lower than in fiscal year 2023. In the fourth quarter of 2024, interest on loans represented 61% of total interest income. In the fourth quarter of 2024, income from government and private securities decreased 32% or ARS 148.3 billion quarter-on-quarter and increased 35% or ARS 81 billion compared with the same period of last year.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

This result is explained 73% by income from government and private securities at amortized cost, and the remaining 27% is explained by income from government securities valued at fair value to profit through other comprehensive income. In fiscal year 2024, income from government and private securities totaled ARS 1.11 trillion, 54% lower than in fiscal year 2023. In the fourth quarter of 2024, income from repos totaled ARS 444 million, 98% or ARS 19.6 billion lower than the previous quarter, and 100% or ARS 182.8 billion lower than a year ago. It is worth noting that as of July 22, 2024, the Central Bank decided to terminate repos and replace them with LEFIs, which are now issued by the Treasury. In the fourth quarter of 2024, FX income was ARS 18 billion lower than the previous quarter and 100% or ARS 398.4 billion lower than a year ago.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

In the quarter, the Argentine peso depreciated 6.3% against the US dollar. In fiscal year 2024, FX income totaled ARS 163.2 billion, 91% lower than the result posted in fiscal year 2023, while the peso depreciated 27.7% in fiscal year 2024. In the fourth quarter of 2024, interest expense totaled ARS 286.5 billion, decreasing 8% or ARS 25.1 billion compared to the previous quarter, and 56% or ARS 561.9 billion lower compared to the fourth quarter of 2023. Within interest expenses, interest on deposits decreased 9% or ARS 26.2 billion quarter-on-quarter due to a 208 basis points decrease in the average rate paid on deposits, while the average volume of deposits from the private sector increased 1%.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

On a yearly basis, interest on deposits decreased 67% or ARS 550.9 billion, and in fiscal year 2024, interest expense totaled ARS 1.8 trillion, which was 47% lower than in fiscal year 2023. In the fourth quarter of 2024, the bank's net interest margin, including FX, was 26.1, lower than the 26.8 posted in the third quarter of 2024 and lower than 41.7 posted in the fourth quarter of 2023. In the fourth quarter of 2024, Banco Macro's net income totaled ARS 139.9 billion, 6% or ARS 7.6 billion higher than in the third quarter of 2024, and was 11% or ARS 13.9 billion higher than the same period of last year. In fiscal year 2024, net income totaled ARS 485.9 billion, 1% higher than in fiscal year 2023.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

In the fourth quarter of 2024, net income from financial assets and liabilities at fair value to profit or loss totaled ARS 134.9 billion, increasing 21% or ARS 23 billion compared to the third quarter of 2024. This result is mainly due to profit from investment in derivative financing instruments. On a yearly basis, net income from financial assets and liabilities at fair value to profit or loss decreased 93% or ARS 1.8 trillion. In fiscal year 2024, net income from financial assets and liabilities at fair value to profit or loss totaled ARS 2.2 trillion, 5% higher than in fiscal year 2023. In the quarter, other operating income totaled ARS 48.8 billion, ARS 153 million higher than in the third quarter of 2024. On a yearly basis, other operating income decreased 11% or ARS 6 billion.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

In fiscal year 2024, other operating income totaled ARS 214 billion, 35% higher than in fiscal year 2023. In the fourth quarter of 2024, Banco Macro's administrative expenses plus employee benefits totaled ARS 261.8 billion, 4% or ARS 10.4 billion lower than the previous quarter, due to lower employee benefits, which decreased 2%, and lower administrative expenses, which decreased 8%. On a yearly basis, administrative expenses plus employee benefits decreased 21% or ARS 70.2 billion. In fiscal year 2024, administrative expenses plus employee benefits increased 11% compared to fiscal year 2023. As of the fourth quarter of 2024, the efficiency ratio reached 39.4%, deteriorating from the 36.3% posted in the third quarter of 2024 and the 13.6% posted one year ago. In the fourth quarter of 2024, expenses decreased 2%, while net interest income plus net income plus other operating income decreased 9% compared to the third quarter of 2024.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

In the fourth quarter of 2024, the result from the net monetary position totaled a ARS 221 billion loss, ARS 85.6 billion lower than the loss posted in the third quarter of 2024, and 81% or ARS 924 billion lower than the loss posted one year ago. Lower inflation was observed during the quarter, 410 basis points below the third quarter of 2024. Inflation was down from 12.1% in the third quarter to 8% in the current quarter. In fiscal year 2024, the result from the net monetary position totaled ARS 2.4 trillion, loss 17% lower than the one posted in fiscal year 2023. Inflation in 2024 reached 117.8% compared to the 211.4% registered in 2023. In the fourth quarter of 2024, Banco Macro's effective tax rate was 26.6% lower than the registered in the fourth quarter of 2023.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

In fiscal year 2024, the effective income tax rate was 9.2% given the loss posted in the second quarter of 2024 and was lower than the 32.7% registered in fiscal year 2023. Further information is provided in note 24 to our financial statements. In terms of loan growth, the bank's total financial reached 5.8 trillion pesos, increasing 18% or ARS 884.1 billion quarter-on-quarter and 45% or ARS 1.8 trillion higher year-on-year. Within commercial loans, documents and others stand out with a 49% or ARS 336.3 billion increase and a 15% or ARS 137.6 billion increase, respectively. Overdraft decreased 26% or ARS 192.5 billion. Within consumer lending, almost all product lines increased during the fourth quarter of 2024. Personal loans and credit card loans stand out with a 36% or ARS 303.8 billion and a 14% or ARS 169.7 billion increase, respectively.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

In fiscal year 2024, documents, others, personal loans and credit card loans stand out with a 39%, 52%, 122%, and 31% increase, respectively. In the fourth quarter of 2024, peso financing increased 14% or ARS 577.7 billion, while US dollar financing increased 29% or $246 million. It is important to mention that Banco Macro's market share over private sector loans as of December 2024 reached 8.3%. On the funding side, total deposits decreased 3% or ARS 299.3 billion quarter-on-quarter, totaling ARS 8.4 trillion, and increased 15% or ARS 1.1 trillion year-on-year. Private sector deposits increased 2% or ARS 147 billion quarter-on-quarter, while public sector deposits decreased 40% or ARS 433.3 billion quarter-on-quarter.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

The increase in private sector deposits was led by time deposits, which increased 6% or ARS 122.3 billion, while demand deposits increased 2% or ARS 97.8 billion quarter-on-quarter. Within private sector deposits, peso deposits increased 2% or ARS 106 billion, while US dollar deposits decreased 18% or $587 million. As of December 2024, Banco Macro's transactional accounts represented approximately 65% of total deposits. Banco Macro's market share over private sector deposits as of December 2024 totaled 7%. In terms of asset quality, Banco Macro's non-performing total financial ratio reached 1.28%. The coverage ratio measured as total allowances and expected credit losses over non-performing loans under Central Bank rules reached 158.81%.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

Consumer portfolio non-performing loans deteriorated 4 basis points, up to 1.44 from 1.4 in the previous quarter, while commercial portfolio non-performing loans deteriorated 21 basis points in the fourth quarter of 2024, up to 0.88% from 0.77% in the previous quarter. In terms of capitalization, Banco Macro's accounted an excess capital of ARS 2.8 trillion, which represented a Capital Adequacy Ratio of 32.4% and a Tier 1 Ratio of 31.6%. The bank's aim is to make the best use of this excess capital. The bank's liquidity remained more than appropriate. Liquid assets to total deposits ratio reached 79%. Overall, we have accounted for another positive quarter. We continue showing a solid financial position. Asset quality remained under control and closely monitored, and we keep on working to improve more our efficiency standards, and we keep a well-optimized deposit base.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

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

[Operator]

Thank you. To ask a question, please press star then one on your touch-tone phone. We will pause for one moment while we assemble our roster. Today's first question comes from Ernesto Gabilondo with Bank of America. Please go ahead.

[Ernesto Gabilondo, Vice President and Senior Equity Analyst at Bank of America]

Thank you. Hi, good morning, Jorge and Nico, and thanks for the opportunity to ask questions. My first question will be on macro expectations. So just wondering, what are you seeing in terms of interest rates, inflation, GDP growth, effects for this year? My second question will be on your ROE expectations for this year. We understand there was a challenging 2024, especially for you in the second quarter. So how do you see the ROE recovering in 2025? And can you elaborate on the drivers for earnings growth this year?

[Ernesto Gabilondo, Vice President and Senior Equity Analyst at Bank of America]

When should we expect the ROE to return again to 20% levels? My last question is on asset quality. We saw modest NPL deterioration, but sequentially higher provision charges. I just want to double-check if this is explained because you are building provisions based on expected losses. How should we think about a cost of risk in 2025? For that, what will be your long-run assumption? Thank you.

[Jorge Scarinci, CFO at Banco Macro]

Ernesto, good morning. How are you? This is Jorge Scarinci. Thanks for your questions. Well, first one, in terms of macroeconomic expectations, according to the latest economic data released by the government, the decline of GDP in 2024 was close to 2%. The consensus for GDP growth in real terms for 2025 is 5.5%.

[Jorge Scarinci, CFO at Banco Macro]

Inflation is expected to be in the area of 25% for 2025, coming down a lot from the 118% that we got in 2024. According to the FX, the consensus for the market is expecting an FX of 1,250. That's the official one for the end of the year. Those are basically the most important macro estimates that we have right now. Sorry, I can add also in terms of fiscal accounts, the consensus is a primary fiscal surplus of 0.7% and a financial surplus that should be very close to zero, 0.1%. In terms of ROE expectations, yeah, I agree with you that 2024 was not a good year. Basically, the second quarter was a poor one, basically in relation to the performance of the bond portfolio. That's why we are forecasting that 2025 is going to be much better.

[Jorge Scarinci, CFO at Banco Macro]

We are forecasting an ROE range for 2025 that goes from 12%-15%, and this is going to be fueled by an increase in lending to the private sector. I would say that our estimate for loan growth in real terms for 2025 is 60%, and this is a consequence of what we are seeing, that consumer lending is growing faster than what we had expected, and therefore, those types of loans where we can get the higher rates, so ROE should be based on this loan growth and should be ranging 12%-15% in 2025.

[Jorge Scarinci, CFO at Banco Macro]

Honestly, when we come back to levels close to 20%, I would say that if economic conditions continue to be the ones that we are going to have in 2025, if we can extrapolate them to 2026, 2027, I think that by the end of 2026, we are going to be very close to the 20% ROE that you were mentioning, Ernesto. According to NPL deterioration, I mean, the 1.15% of NPL ratio that we posted in the third quarter was extremely good, but of course, this was a consequence of a small or short level of loan growth. In fourth quarter, we saw basically if we do not consider overdraft, basically the overdraft is where we allocate part of the excess liquidity.

[Jorge Scarinci, CFO at Banco Macro]

So if we do not include that, loan growth in the fourth quarter was 25% up quarter-on-quarter and 56% up year-on-year in real terms. So as a consequence of this increase in lending, both the increase in NPLs and also the increase in cost of risk. I think that in previous calls, also in meetings with the investors, I have been saying that because of the increase in lending, we could be seeing some deterioration in NPLs and some increase in cost of risk. I would say that cost of risk in 2025 could be about 2%, could be reaching 2.5%. So that is what we are seeing for 2025 in terms of cost of risk and NPLs. So I don't know if I answered all your questions.

[Ernesto Gabilondo, Vice President and Senior Equity Analyst at Bank of America]

Yes. No, no. Super helpful. Just in terms of loan growth, I just want to double-check if you mentioned you're expecting a 60% growth?

[Jorge Scarinci, CFO at Banco Macro]

Yes, 60% in real terms growth for loan growth in 2025.

[Ernesto Gabilondo, Vice President and Senior Equity Analyst at Bank of America]

Okay. Perfect. And then in terms of doing the math on getting to an ROE of 12%-15% for 2025, that implies approximately a 100% net income growth for 2025. And as you mentioned, it will be driven by loan growth and then trying to translate that into financial results. And also likely because of lower monetary losses under such a low inflation level. Is that number correct to think about such a high earnings growth this year?

[Jorge Scarinci, CFO at Banco Macro]

Basically, we are targeting those levels. Again, the range is between 12% and 15%, and the drivers are the ones that you mentioned before: loan growth, some fee growth, controlling expenses, lower inflation losses, and the maintenance of the margins along 2025.

[Ernesto Gabilondo, Vice President and Senior Equity Analyst at Bank of America]

Perfect. Excellent. Super helpful. Jorge, thank you very much.

[Jorge Scarinci, CFO at Banco Macro]

Welcome, Ernesto.

[Operator]

Thank you. Our next question comes from Pedro Offenhenden with Latin Securities. Please go ahead.

[Pedro Offenhenden, Research Analyst at Latin Securities]

Hi, Nicolás. Hi, Jorge. Thank you for the call. I have a question regarding securities. How do you expect the weight of securities to evolve in 2025? And given the expected 60% growth in your loan book this year, will this growth be primarily funded by the unwinding of securities or deposit growth? And finally, if you have any projections of how the loan-to-asset and security-to-asset ratio could look this year. Thank you.

[Jorge Scarinci, CFO at Banco Macro]

Hi, good morning. The securities portfolio is approximately 27% of total assets. We think that in 2025, by December of this year, we are going to see that ratio decreasing to levels maybe in the area of 20% or slightly below 20%.

[Jorge Scarinci, CFO at Banco Macro]

I mean, ideally, the funding for loan growth is going to come basically from deposit growth in pesos that we are expecting to grow in the area of 35% in real terms. And of course, we are in a loan-to-deposit ratio below 100%. And part of that also is going to be financed by the reduction in securities. So I would say that 80% is going to come from deposits, 20% of the funding of loan growth is going to come from reduction of securities portfolio.

[Pedro Offenhenden, Research Analyst at Latin Securities]

Thank you.

[Jorge Scarinci, CFO at Banco Macro]

Welcome.

[Operator]

Thank you. And our next question comes from Brian Flores at Citibank. Please go ahead.

[Brian Flores, Vice President in Equity Research at Citi]

Hi, team. Thank you for the opportunity to ask questions. I just wanted to make two questions. The first one is on capital consumption because we saw the data from the system. The system is already consuming between 200 and 300 basis points per month.

[Brian Flores, Vice President in Equity Research at Citi]

It's very interesting to see that your numbers actually increased marginally, but they increased quarter-over-quarter. So if you could expand a bit on what is driving this and what we could expect. Jorge, you were mentioning expectations of growing 60% year-over-year. This would naturally consume and bring risk-weighted assets into the denominator. So I just wanted to double-check here if the capital consumption that we should see is in line with what we're seeing for the system, maybe faster, maybe slower. But any color you could give us on that? And then I'll ask my second question later. Thank you.

[Jorge Scarinci, CFO at Banco Macro]

Hi, Brian. No, you're right. When you look at the table, the total capital requirement has increased 12% quarter-on-quarter and 130% year-over-year. There are things that basically you have some increase in part of the equity.

[Jorge Scarinci, CFO at Banco Macro]

It's very explained in the table there. But we are forecasting that the excess of capital of almost ARS 2.8 billion that we have in the fourth quarter, of course, due to the high level of loan growth that we are forecasting, is going to go down. We understand that the 31.6% Tier 1 ratio that we posted at the end of December is going to come down. Also, if you take into consideration the $300 billion that we are paying in ARS 300,000 million, sorry, that we are going to pay in cash dividends in May of this year. So we are forecasting that the Tier 1 ratio by the end of the year should be in the area of 25%-26% approx. But yes, what you mentioned is that there's capital consumption and more in 2025 that we are expecting for the system also to grow fast in loans.

[Jorge Scarinci, CFO at Banco Macro]

It is very important to know that we have the best capitalized balance in the Argentine banking sector. We are much better prepared to continue lending and growing in lending compared to our peers.

[Brian Flores, Vice President in Equity Research at Citi]

Perfect. Super clear. Then maybe a second question, if I may. You elaborate a bit on deposits. You mentioned expectation of 30% real growth in 2025. I just wanted to expand a bit on that. Is there any particular strategy that you're pursuing to gain share or to compete? Because I know probably, as you mentioned, the first part of the allocation is mainly driven by the excess capital that you have. But at some point, as we go back into credits and as people are saying, right, banks becoming banks again, the organic sources of funding become more and more relevant. So just wanted to check because I think every bank is going to be competing very strongly for deposits. So just wanted to see how you're thinking about the strategy to compete on this going forward? Thank you.

[Jorge Scarinci, CFO at Banco Macro]

Well, in terms of, I mean, deposits, there's going to be competition. I believe that there should be some marginal increase in maybe in deposit rates, in kind deposit rates. But when you look at the numbers in the fourth quarter, we grew 11% year-on-year our peso deposits and 24% our dollar-denominated deposits. We think that 2025, the increase will continue. I mean, sorry, the fiscal side or the government is going to demand less from the private sector. And therefore, we believe that the private sector is going to be increasing their deposits. The monetary base is going to continue increasing. So basically, those will be the drivers. But I agree that some competitions could create additional pressure, upward pressure on deposit interest rates.

[Brian Flores, Vice President in Equity Research at Citi]

No, that is super helpful. If I just may, a final comment on deposits. Do you expect more regulatory changes as the one we saw last week as to now use at some point maybe finally deposits in dollars on the asset side of the balance sheet?

[Jorge Scarinci, CFO at Banco Macro]

I think that the central bank is trying to work on different regulations and trying to maintain the efficiency and the solvency of the system. As far as we know, there should not be important regulation changes, at least in the first four months of 2025. Honestly, we are not informed yet. Going forward, I cannot assure, but nothing in the pipeline.

[Brian Flores, Vice President in Equity Research at Citi]

Super helpful. Thank you.

[Jorge Scarinci, CFO at Banco Macro]

Welcome.

[Operator]

Thank you. As a reminder, to ask a question, please press star then one. Our next question comes from Carlos Gomez-López with HSBC. Please go ahead.

[Carlos Gomez-López, Head of LatAm Financial Institutions at HSBC]

Hello, Jorge. And thank you for the update. First, can you tell us anything about any upcoming management changes at the bank or whether you have any news there? Maybe you mentioned it earlier, but I didn't catch it. Second, on the deposits, if we see this correctly, there was actually a decline in dollar deposits between the third and the fourth quarter. And to go back to the question, when do you think that deposits start growing? Because private sector deposits only grew 2% quarter-on-quarter. Do you need higher interest rates for that to happen? And finally, to confirm, the dividend that you are paying is $300 million? Thank you.

[Jorge Scarinci, CFO at Banco Macro]

Carlos, how are you? Yeah.

[Jorge Scarinci, CFO at Banco Macro]

There's going to be some news on management. I would say maybe in the short future, basically in a new CEO. Honestly, I cannot make additional comments, but there will be some announcements in the short run in relation to our CEO. That is the only news related to management changes that we are expecting. Second question in terms of deposits. Yes, you're right. There was some decline in dollar-denominated deposits between the third and fourth quarter. Remember that on the third quarter, there was the full impact of the tax amnesty that impacted in the system, also in the bank. Of course, in the fourth quarter, we saw some decline in dollar-denominated deposits. Some investors were moving their deposits to maybe corporate bonds or some other type of investments in dollars that are not fixed deposits or savings accounts in dollars.

[Jorge Scarinci, CFO at Banco Macro]

Going forward, we think that in relation to this regulation on central bank, there could be some, again, upward trend in terms of interest rates, not only in dollars, but could be also impacted in pesos. Those would be, I would say, the drivers that could be making deposits growing to the level that we mentioned in 2025. In relation to the third question, yeah, the dividend, it's going to be below $300 million if you take the unofficial FX rate of 1,200. So it should be the area of $240 million.

[Carlos Gomez-López, Head of LatAm Financial Institutions at HSBC]

Okay. On rates, so where do you expect the policy rate to be by the end of the year?

[Jorge Scarinci, CFO at Banco Macro]

The policy rate? The policy in interest rates in the deposits, you mean, Carlos?

[Carlos Gomez-López, Head of LatAm Financial Institutions at HSBC]

No, the interest rate by the central bank, the reference rate.

[Jorge Scarinci, CFO at Banco Macro]

No, I mean, the consensus is showing some increase by the end of the year of 3 or 4 percentage points in the peso monetary interest rate by the end of the year, no?

[Carlos Gomez-López, Head of LatAm Financial Institutions at HSBC]

Okay. So an increase of 3%-4%. Thank you.

[Jorge Scarinci, CFO at Banco Macro]

Yes.

[Operator]

Thank you. There are no further questions at this time. This concludes the question and answer session. I would now like to turn it over to Mr. Nicolás Torres for final considerations.

[Nicolás Torres, Head of Investor Relations at Banco Macro]

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

[Operator]

Thank you. This concludes today's conference call. We thank you all for attending today's presentation. You may now disconnect your lines and have a wonderful day.

Participants

Analysts

• Brian Flores, Vice President in Equity Research at Citi
• Ernesto Gabilondo, Vice President and Senior Equity Analyst at Bank of America
• Pedro Offenhenden, Research Analyst at Latin Securities
• Carlos Gomez-López, Head of LatAm Financial Institutions at HSBC
• Jorge Scarinci, CFO at Banco Macro
• Nicolás Torres, Head of Investor Relations at Banco Macro