Conference Call Transcript Banrisul (BRSR6 BZ) 1Q12 Results May 15 th, 2012

Transcription

1 Operator: Good morning, ladies and gentlemen. At this time we would like to welcome everyone to Banrisul s 1Q12 results conference call. Today with us we have João Emilio Gazzana, CFO and IRO, Werner Köhler, Head of Accounting, and Alexandre Pedro Ponzi, Head of Investor Relations. We would like to inform you that this event is being recorded and all participants will be in listen-only mode during the Company s presentation. After Banrisul s remarks are completed, there will be a question and answer session. At that time, further instructions will be given. Should any participant need assistance during this call, please press *0 to reach the operator. The audio and slideshow of this presentation are available through a live webcast at The slideshow can also be downloaded from the webcast platform in the Investor Relations section of this website. There will be a replay facility for this call for one week. Before proceeding, let me mention that forward-looking statements are based on the beliefs and assumptions of Banrisul s management and on information currently available to the Company. They involve risks, uncertainties, and assumptions because they relate to future events and therefore depend on circumstances that may or may not occur in the future. Investors should understand that general economic conditions, industry conditions, and other operating factors could also affect the future results of Banrisul and could cause results to differ materially from those expressed in such forward-looking-statements. Now I will turn the conference over to Mr. João Emilio Gazzana, CFO and IRO, who will start the presentation. Mr. Gazzana, you may begin the conference. Thank you for attending Banrisul conference call. As you all know, yesterday we released Banrisul s 1Q financial statements, and Alexandre Ponzi will be presenting our numbers in a few minutes. As soon as our Alexandre Ponzi finishes the presentation, we will be at your disposal to clarify doubts and answer your questions. Then let us start with Alexandre Ponzi presenting our slides. Please, Alexandre. In order for us to expedite the Q&A session, let us browse through the numbers and the slide that we have included in the presentation. If you could move to slides number two and three, we show that we have maintained market share in Brazil and also improved our market share in the State of Rio Grande do Sul. When and where we extended our service network in another 13 p.p. in the quarter alone in about 51 new points in comparison to the 1Q

2 Credit growth in 12 months was higher than that of the financial system, as shown in slide three, in which we grew at the rates of 18.8% our total loans, being 15.7% the rate of growth of our non-market commercial credit portfolio, while the Brazilian banking the industry grew by 18%. Slide four. Credit growth has been driven by the growth in deposits, also 18.4% in 12 months, and above all from time deposits, which in March reached an annual growth rate of 35.7%. Highlights; core retail funding from branch network, with the exception of a portion of USD500 million (foreign subordinated debt) that boosted the growth of deposits between March 2011 and March Total assets of US$39.8 billion in March 2012, as seen on slide five, was up 21% in comparison to March 2011, and now credit operations account for nearly 54% of assets. ROA changed from 2.6% in March 2011 to 2.2% in March Domestic and international funding totaled R$29 billion, 23% annual growth, as shown in slide six. In this slide we notice that Banrisul s funding now only demand deposits, saving deposits, and time deposit correspond to 78% of our total funds raised, and is characterized by being of completely retail and of diversified portfolio. And this pattern is a great competitive advantage for Banrisul, given this low-cost overtime. During the 1Q12, according to slide seven, total cost of funding reached 79.8% of the Selic rate, growing over the last quarter because of the funding that we captured abroad. The cost of funding reaching now 85% of Selic rate in the 1Q12 is down from the 87.7% in March As a consequence, slides eight, nine, and ten show that our loan portfolio reached R$21.3 billion, 19% in 12 months, and 4.5% growth in the last quarter alone, which is about the average of the Brazilian industry, and this credit growth and credit now representative of 55% of all total assets is based on good quality operations, allowing us to maintain the barrels of provision vis-à-vis the total credit portfolio stable at 6.5% over the last five quarters. The turnover of our credit portfolio, or in other words the total amount of loans that we have granted over the 12 past months increase by 8.5% in comparison to March 2011, not only in the commercial portfolio, but also from specialized credit lines, which brings us the advantage of improving customer loyalty in the long run. The Bank's loan portfolio is diversified, as presented in slide 11, and commercial credit accounts for 75% of the total credit portfolio. Agricultural loans 8%, and real estate finance 9% of the loan book. Credit to individuals is still dominant in the commercial credit portfolio, and it shall increase to 54.5% in the 1Q11 as opposed to the 53% in the 4Q11. Out of this portfolio, 70% are related to payroll loans, 61% being of our own generation, and 39% from the acquisitions that we have made from other banks. Credit to companies 46% of the total commercial portfolio. We still have working capital lines as the most relevant one, composing 75% of the portfolio in this segment. Commercial credit portfolio grew at a rate slightly or under with the one that we grew in our loan portfolio, 15.7% in 12 month

3 Shown in slide 12, commercial portfolio to companies with a balance of R$8.7 billion in March 2012 grew nearly 12% over the 1Q11 and almost 8% since December last year. Credit to companies grew approximately 21% in 12 months and 1.5% from December, reaching the balance of R$7.3 million in March this year. Slide 13, the quality of the loan portfolio, with 88.4% of its operations classified as normal credit risk (AA to C). Provision of 6.5% compared to total loans, as mentioned above, and with low default rates (3% for loans overdue more than 60 days, and 2.5% for 90 days), with a slight increase since December, Comfortable coverage ratios, 215% and 255%, for 60 and 90 days, respectively. Slide 14, our securities portfolio. Balance of R$12.3 billion, 26% growth in the last 12 months. The 11.4% growth in the last quarter is due to the increased liquidity that came from the foreign subordinate issuance, which was not yet fully directed to credit operations. The higher amount of credit assets is reflected in 19% growth in revenues from financial intermediates in 12 months, reaching a balance of R$1.5 billion; on slide 15. Revenue growth over the last quarter increased by transactions using derivative financial instruments and it was reduced by the contraction of the Selic rate, causing a drop in revenues from securities, and profitability was therefore seen in income from credit transactions. Provision expenses recorded in March this year grew 21% in the last 12 months, slightly above what we are seeing in the growth of our credit portfolio, and remained stable from the 4Q11 to the 1Q12; slide 16. Funding expenses in the 1Q % above the 4Q11, with a balance of R$445 million in funding expenses in March this year, it is 4% below the balance we saw in December, given the reduction of the Selic rate. Net interest income, slide 18, R$896 million, 19% higher than what was recorded in March last year, 1.2% below December last year. Over the last quarter, net interest income was reduced by default of revenues from securities and also from foreign exchange revenues, and increasing expenses with credit and on-lendings, although this was partially reduced from costs in revenues from derivatives. Operating expenses, on slide 19, an amount of R$475 million in the 1Q12, is 2.3% over March last year and 6% below December last year. In the past 12 months, personnel expenses grew due to the salary increases and also from the higher number of employees. More than a little more than 500 employees were added to our staff in the last period. The decrease recorded during the last quarter is seasonal due to the concentration of holiday vacations during summer months. OPEX 24% in 12 month on account of increased outsourced services, data processing, and telecommunication, partially responsible to increase volumes and transactions from Banricompras, and commissions paid to investment banks. The press release table trend that we saw from the 4Q11 to the 1Q12 was due to lower spending on advertising and publicity. Net income, slide 20, R$240 million in the 1Q12, 1.5% - 3 -

4 higher than what we saw in the 1Q11, bringing ROE to nearly 21% on an annual basis. In the last quarter, this net income is down by 5.7%, given the stability of credit revenues, reduced treasury revenues, and also the increase of other operating expenses. ROE based on the results of the 1Q12 reached 20.6%. Income per share is R$0.52, slightly lower than in December And also with the payments of interest on equity that has been made this year, in the 1Q12, as part of our 40% payout policy, increased 14.12% over the same period last year. Shareholders equity, R$4.5 billion, growing margin 13.5% in 12 months and above 3.5% over the quarter, from incorporating the income on the period deducted from the payments of interest on capital. Main performance indicators, slide 24. Efficiency ratio increased by 50 b.p., reaching 45.7% in the 1Q12, virtually the same that we saw in March last year. ROE decreased from 23.3% to 20.6% in the same period, ROA also decreased from 2.6% to 2.2%. But still, even with the reduction, such indicators follow and even surpass the indicators that we have seen from the other banks. Basel index also ended the 1Q12 with a slight decrease in comparison to December, from 17.2% to 16.3%, but still completely core capital and quite comfortable. Banricompras, on slide 26, with the financial volume and the number of transactions growing 16.5% and 11.6% in the last three months, with more than R$1.4 billion traded in more than 20 million transaction. The reduction that we observe in the quarter is explained by seasonal increase in transactions during the last quarter of each year. And the numbers presented for Banrisul are mainly produce from Banrisul s debit cardholders alone; it has not included in full the proceeds from the MasterCard acquisition, nor from Visa, which will start immediately. Banrisul s performance has been supported by initiatives to leverage business and products by significant investments in technological upgrades, and it is a permanent investment that we have been doing, growing at rates of almost 8% year on year, which allows us to provide service in a fast and secure manner to all of our account holders, close to 3 million in total, and also to non-account holders. In 2011 alone, we invested about R$190 million, slide 27. Finally, on slide 28, we have the guidance for 2012 with numbers that are approximately those that we achieved during 2011 and which we have not yet changed. This is all for presenting the slides and the main numbers for Banrisul. Now I will turn the call over to Mr. Gazzana and later to yourselves. Thank you. Well, we are at your disposal to answer your questions and clarify any doubts

5 Thiago Batista, Itaú BBA: Hi, guys. Good morning to everyone. Could you give us more color about the increase in the NPL ratio? We saw some increase in NPL ratio during the 1Q, and during the Portuguese conference call you gave us the breakdown of NPL ratio in individuals and corporate segments. But could you give us a change in NPL ratio during the 1Q divided into these two segments? And what are you expecting going forward in the NPL ratio? Thiago, we are expecting some increase in our NPL ratio for the next quarter. And the increase in our NPL is related mainly to small companies. If you remember, in the previous call we said that we were introducing a new risk model for small companies, where we tended to establish stricter credit risks. So, as a result we are seeing some increase in NPL rates. Of course it is related also to the economic situation, which is affecting all other large banks in Brazil as well. And in our case we are expecting some increase in our NPL. It is more related to small companies. I do not know if we answered your question. Thiago Batista: Yeah. Gazzana, during the Portuguese conference call you also commented about some expectations about profitability. Could you comment a little more about what you are expecting in terms of profitability for the Bank in the coming years? Well, for the future as the Selic rate is coming down, we expect some reduction in our spreads; the same is going to happen to the whole financial sector in Brazil, because with a lower Selic rate the tendency is for the spreads to be lower. I use to give an example: if we have an operation linked to the Selic rate, like 130% of the Selic rate. When the Selic rate was 12%, 30% spread over the Selic rate would be something around 3.6 p.p. If you have a Selic rate of 8% and you have the same operation running at 130% of the Selic rate, with over price of 30%, would represent something around 2.4 p.p. So, you can see that even without changing the rates of our credit operations, our entire portfolio linked to the Selic rate tends to have a lower spread as the Selic rate is reducing. At the same time, even in the fixed interest rate, as time passes we have to adjust our rates as for new operations. So, as time passes, the tendency is for our rates to be lower, and of course with lower rates the tendency is for the Bank to have lower spreads as well. For 2012, we have some protection because we have a part of our portfolio related to fixed interest rate. So, in this case there is a delay in the adjustment of our spreads. Even though, even our spread tends to be higher because if you have fixed interest rate like our payroll discount lending, in this case is fixed interest rate. As the Selic rate comes down, of course our spreads tends even to be higher at first

6 During 2012, at least is the 1H12 and part of the 2H12 we will be able to defend ourselves from this tendency for lower spreads, because we have a part of our operation in a longterm basis. But of course, for 2013 and 2014 the tendency is for the spreads to be lower. As we said in our conference call in Portuguese, we are analyzing the new scenario in Brazil and it is possible that in the near future we see some adjustments in our guidance. Let us say, our NIMs are set up in a range between 10% and 11%. Maybe we will be making some adjustment from something between 9.7% and 10.5%, something around that, instead of from 10% to 11%. But we are making our calculations, taking into account this new scenario, and at the same time, like I said before, that we have part of our portfolio in a fixed interest rate, so we have some possibility to defend ourselves. But anyway there is some possibility that we come to the market, in the near future, making some adjustment in our NIM estimates. At the same time, as a return on equity maybe it is going to be lower. We will be near the bottom of the range we established in our guidance; the range established was from 19% to 23%, and we were running something around 22%. With this is new scenario maybe we tend to be near the floor of this range, or maybe we have to make some adjustments starting from a lower number; instead of starting from 19%, maybe from 17% or 18%. It depends on the new analysis our technical area is providing some studies in this area. So, there is some possibility for us to make some adjustments in our NIMs for 2012, a small adjustment like I said, and some small adjustment also for our return on equity, reducing the floor of the range we had established before. Thiago Batista: OK. But could the increase in the leverage of the Bank prevent this reduction in the ROEs? Well, this is why we are not sure we are going to announce this new return on equity. Concerning credit growth, the tendency is for us to keep the same guidance, from 15% to 20%. So, at least up to now, we do not see the possibility to announce a higher guidance for credit growth. Credit growth tends to be something between 15% and 20%. So, maybe we could increase our profitability related to the increase in our credit portfolio and increasing our leverage, but the tendency is for us to keep the rate of growth between 15% and 20%. So, this is why I am telling that maybe we have to make some adjustments in our guidance related to return on equity. Thiago Batista: OK. Thank you, Gazzana. There is another point that is important to stress here, given the profitability. Even if we do leverage, which we are planning, especially coming from the transactions from Bem Vindo, which helped us increase by the end of last quarter, not only the number of credit - 6 -

7 transactions but also the amounts that we have produced, but still not generating much in terms of revenues, the point is we are in a different scenario given the pressure to decrease interest rates. So, in terms of guidance for credit growth from 15% to 12%, it is unlikely that it will be changed. But the question of if and how much profitability will be hurt is a question of us trying to leverage more than we could produce, especially from Bem Vindo, but also from seeing what the competition is doing and by controlling NPL, which was the first part of your question. We do assume that it is likely to decrease profit on the 2Q, but also we saw the same movement in the last part of 2011, in which by November we had a higher NPL than we have now. And we have announced the average this year that we were expecting that NPLs could be closer to 3%, which was what we produced in this year alone. And it is coming from small companies. So, profitability is a question of how the pressure for decreasing interest rates will behave. But we do assume that as of today we could reach at least 19% ROE that we forecasted before. Thiago Batista: OK. Thank you, Alexandre. Victor Galliano, HSBC: Hi yes. Thank you. Two questions for you, first of all in terms of, should we say, the pressure to decrease interest rates, I mean what is the strategy of the Bank kind of walk on the tight rope, so to speak, to keep Federal Government at bay? In other words, deliver on this into decrease interest rates, and at the same time not to damage too much the returns of the Bank. Are you looking to apply this more, the lower rates, in areas where, shall we say, you are less strong and represent a smaller percentage of your loan book? And also in terms of the small companies and the fact that you are saying this is the area where loan growth is coming from, are we looking here at very small SMEs? What sort of segments are we looking at? And are you not concerned in the slow growth environment that this could, in fact, lead to higher NPLs going forward? How are you mitigating the NPL risk going forward? Thank you. Victor, thank you for your question. Well, related to small companies, really we are doing some adjustments in our credit risk model, and in the last 12 months, and even in the 1Q, we even reduced the amount of credit directed to small companies. Of course we intend to keep growing in this area in the future, but for now we are making some adjustments in our credit risk model, because we were foreseeing, like it happened, from increasing NPL in these areas. So, we are, I would say, in a transition period where we are introducing this new credit risk model for small companies. And for a while, in this 1Q and the 2Q the rate of growth in this area will be very low or even negative. As like we said, some increase in the NPL is coming just from small companies

8 But one area where we think we will be able to improve in some way our spread is related to payroll business, because the tendency for the future is to reduce the part of our portfolio we buy from other banks and to increase our own generation. As we increase our own generation, the tendency is to have higher spreads in this area. So, it will be a way to try to compensate part of this reduction in the Selic rate, increasing our spreads in this portfolio, payroll discount, where we are very much protected, because we are lending inclusively to Federal Government employees and to some State Government employees, where the risk is very low in this area. Anyway, of course we are making all efforts in order not to lose spreads, but with a lower Selic rate it is difficult to keep the same level of spreads. Of course in 2012, we have some room of maneuver yet, but for the future, if this reduction in the Selic rate becomes true, like the Government wants it to happen, it will be difficult to keep the same level of spreads. OK. Thanks. And what about increasing margin pressure, which was interest rate pressure on the corporate side? Is that something that Government is also pressuring you on? Well, for large companies you know that we have something around 13% of our total portfolio related to loans to large companies. We have still something between 86% and 87% of our total portfolio related to individuals or medium-sized companies. I would say that there is at least a lag in the near future as we will not be growing so much in the small companies. There is a tendency for our credit portfolio of medium size and large companies to increase. But as long as we are increasing some business with large companies, we are aiming at the same time to capture the possibility of increasing our relationship with the suppliers of these companies, because we do not intend to grow with large companies as such, because when we are focusing in a way to increase our relationship with the supplier chain of these companies, we are setting up some new credit programs in order to be able to increase our business with small- and medium-sized companies capturing just suppliers chain with these companies. Anyways, even with small-, medium-sized, and large companies, with a lower Selic rate related to spreads, the tendency is the same. It will be difficult to keep the same spreads, like I explained before. With a lower Selic rate it is more or less inevitable for the banks in Brazil to lose some spread. Anyway, the possibility is for Banrisul to keep spreads higher than the average comparing to the large retail banks in Brazil, because we have a large proportion of our portfolio related to small-, medium-sized, and individuals. Even if we grow our lending to large companies, we will be always much more concentrated in our lending mainly to individuals, small- and medium-sized companies. Maybe we can make some adjustments in the near future, like I was saying

9 But anyway, for considering all Banrisul s strategy, we will be always directing our lending book more to individuals, small- and medium-sized companies, where the spreads tend to be higher. Even in our lending portfolio to individuals, where we have more than 70% related to payroll, the but in this case the spread is not so high, it is true, but delinquency rate at the same time tends to be lower. Just a quick follow-up there on your fixed rate portfolio, what is the average maturity of that? So, we can get a sense of how much of a shield that is to lower Selic in the near term, at least. In our payroll business, the duration is something around 30 months, because normally we lend up to 60 months, so the duration is around 30 months. But in this area there is a very strong pressure for the market to, let us say, refinance these operations as the Selic rate comes down. So, if the Selic rate comes down, maybe the repayment of these operations is going to be higher than it used to be. So, the tendency for us is to repay. But even so, at least in this area we could say that the duration, instead of 30 months, with a lower Selic rate tends to be maybe something between 20 months and 24 months, maybe some reduction. But for companies, normally we have something between... For companies is less than that, from 16 months to 18 months. We do not lend over 24 months in terms of working capital. And the duration is closer to 16 months in total. But most of our lending to companies is connected to the Selic rate. Our fixed interest rate is more related to individuals. I would say that almost 100% of what we lend to individuals is not Selic-linked; to companies, typically is more Selic-linked. So, in our lending to part of our portfolio, let us say, our portfolio related to individuals we are going to have some possibility to defend ourselves, because a great part of this lending, as it is not related to the Selic rate, during 2012 we will be able to keep a great part of our spreads; it is fixed interest rate. With companies it is a main problem, because almost 100% of the operations are linked to the Selic rate. So, the tendency is for our rates to be reduced more or less immediately. And in terms of companies, in which we have grown into larger companies, therefore reducing NIMs, we could say that there are two strategies that are embedded in the way that we have been doing this. Large companies: we want to be partner of the companies, so we want to take opportunities of providing credit for them and therefore supply credit to other companies

10 And also in terms of dealing with them, we tried and we have been able to obtain the payroll from them. The point is, in terms of payroll we have increased the number of current account holders at Banrisul, but we are not providing credit for these individuals, which could benefit our credit growth. But then we would be increasing the likelihood of larger NPLs on account of a segment that we do not feel condition into providing credit for individuals. This is something that we have access to a base of customers, but we have not been providing credit for them on account of the risks that could be involved as of the moment we speak. In terms of our reduction from the SMEs, it was a strategy that the Bank did sort of on purpose, because of the fine tuning that we have to make in the system that will be used to escort both credit and the behavior of this profile customers. Specially the small and the very small companies, which are more... individuals that tend to behave like individuals in terms of living with the credit, and want to have the same model that we have for classifying individual customers to this segment. On account of the increase of the NPL that we saw from the 3Q11 to the 4Q11, we reduced our exposure to this segment while fine tuning the system. That is why Mr. Gazzana mentioned that the renewed part of the oxygen that they needed, we did an increase of credit growth in the segment, not to jeopardize or not to deteriorate further the cost of the credit. But until the system is fully operational, which hopefully will happen throughout this quarter, we assume that NPL will increase. Fully operational when, sorry? I did not quite get that; 4Q? Throughout the 2Q, this quarter. OK. I mention before that NPL could increase a little further until June. And really that is driven by the SME book, more than anything else? The vast part of the SME group

11 What part, sorry? The NPL increase is coming from the small companies, rather than the medium-sized ones. Right, yeah. It is the bottom end. All right. Thank you very much, Alexandre. Mariel Santiago, HSBC: Hi. My question is on the efficiency ratio. Right now you are running at nearly 46%, and your guidance is from 42% to 46% for Are you still confident that you will meet this range for the year, and can you explain why? Mariel, yes. We are pretty confident with the guidance that we have provided. We have not even mentioned the likelihood of change in cost efficiency ratio, and the increase or the deterioration of our cost increase related to one-off expense that we have through the quarter, especially related to commissions paid to the Bank to third-party services on account of the issuance that we concluded by the end of January, beginning of February. By the due diligence of the Bem Vindo company and also from one-off, again, expenses related to adjustment on a criteria for labor and civil provision expenses, which added expenses in the 1Q alone. The number is roughly, we have about R$30 million and R$35 million in terms of total expenses, which if removed, not recurring, if they were removed our net income would have an increase of R$20 million. So, the last line would be increase by R$20 million. That is why we say, we deteriorate cost income ratio, 45.7%, still under the guidance but we have maintained this and there is no intention whatsoever to change it. Mariel Santiago: OK. Thank you. My other question is on coverage ratio, you had a decline in the 1Q to 255% from 270%. Should we expect this ratio to go back to the 270%, 280% levels, or what level is comfortable for you? Well, we think that we intend to keep this ratio around 200%, because, of course, even with 214% we are presenting for this 1Q, is well above any other large retail bank in Brazil. So, we are by far over the Brazilian average. And it is difficult to say if it is going to be 214% or 220%, but the tendency is for us to keep it around 200%, maybe a little higher

12 Mariel Santiago: OK. Thank you. Thiago Batista, Itaú BBA: Hi guys. Just a follow-up about the NPL ratio; you commented that you are expecting some increase in the 2Q, but looking at the end of this year what are you expecting the NPL ratio to conclude the year? Could we see some decrease after this increase in the 2Q? Well, we are expecting some increase for the 2Q. It is difficult to tell by the end of the year. But anyway, we are working with, let us say, the worst scenario, it could go maybe to 3.4%, 3.5%. But we are not stating that we are going to reach this level. Let us say, if the situation, mainly with some small companies, go this way, maybe we have to accept something around this level, 3.4%, 3.5%. But we think that in the 2H12, the tendency is for the situation to improve, because the Brazilian economy, and even in Rio Grande do Sul, tends to be in a better shape, the rate of growth of Brazilian GDP tends to increase in the 2H12, the real wage tends to be higher, the rate of unemployment in Brazil, in Rio Grande do Sul is even lower than the Brazilian average. We think the overall economic situation tends to improve in the 2H. So, even if we reach this situation of increasing NPL in the 2Q12, we are expecting some improvement in the 2H12. Mainly, as time passes, for the 3Q and the 4Q. Thiago Batista: OK, perfect. Thank you, Gazzana. Mariel Santiago, HSBC: Yes. I do not know if you have the number, but what percentage of your SME portfolio is with small companies? Small company represents about 5.2% of our total portfolio, and micro companies, 2.4%. So, we are talking roughly about 7% and 7.6% of our total loan book; that is the portion you are asking for. Mariel Santiago: OK. Great, Alexandre. Thank you

13 Operator: This concludes our question and answer session. I would like to turn the conference back over to Mr. Gazzana for any closing remarks. Well, thank you very much for all your questions. And we will be at your disposal anytime you need to clarify some doubts. Please, get in touch with us and we will be pleased to clarify any doubts you may have. Thank you all of you. Operator: The conference has now concluded. Thank you for attending today s presentation. You may now disconnect. This document is a transcript produced by MZ. MZ uses its best efforts to guarantee the quality (current, accurate and complete) of the transcript. However, it is not responsible for possible flaws, as outputs depend on the quality of the audio and on the clarity of speech of participants. Therefore, MZ is not responsible or liable, contingent or otherwise, for any injury or damages, arising in connection with the use, access, security, maintenance, distribution or transmission of this transcript. This document is a simple transcript and does not reflect any investment opinion of MZ. The entire content of this document is sole and total responsibility of the company hosting this event, which was transcribed by MZ. Please, refer to the company s Investor Relations (and/or institutional) website for further specific and important terms and conditions related to the usage of this transcript