6-K 1 tm2037301d1_6k.htm FORM 6-K

 

 

 

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

 

 

 

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE

SECURITIES EXCHANGE ACT OF 1934

 

November 30, 2020

 

 

 

Commission File Number: 001-32827

 

 

 

MACRO BANK INC.

(Translation of registrant’s name into English)

 

 

 

Avenida Eduardo Madero 1182

Ciudad Autónoma de Buenos Aires C1106 ACY

Tel: 54 11 5222 6500

 

(Address of registrant’s principal executive offices)

 

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F x Form 40-F ¨

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

 

Yes ¨ No x

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

 

Yes ¨ No x

 

 

 

 

 

 


 

 

    3Q20 Earnings Release

 

Banco Macro Announces Results for the Third Quarter of 2020

 

Buenos Aires, Argentina, November 30, 2020 – Banco Macro S.A. (NYSE: BMA; BYMA: BMA) (“Banco Macro” or “BMA” or the “Bank”) announced today its results for the third quarter ended September 30, 2020 (“3Q20”). All figures are in Argentine pesos (Ps.) and have been restated in terms of the measuring unit current at the end of the reporting period. As of 1Q20, the Bank began reporting results applying Hyperinflation Accounting, in accordance with IFRS IAS 29 as established by the Central Bank. For ease of comparison, figures of previous quarters of 2019 have been restated applying IAS 29 to reflect the accumulated effect of the inflation adjustment for each period through September 30, 2020.

 

Summary

 

• The Bank’s net income totaled Ps.6.1 billion in 3Q20. This result was 12% lower than the result posted in 2Q20 and 33% lower than in 3Q19. In 3Q20, the accumulated annualized return on average equity (“ROAE”) and the accumulated annualized return on average assets (“ROAA”) were 21.5% and 4.6%, respectively.

 

• In 3Q20, Banco Macro’s financing to the private sector decreased 2% or Ps.3.9 billion quarter over quarter (“QoQ”) totaling Ps.232.2 billion and 12% or Ps.31.9 billion year over year (“YoY”). In the quarter consumer loans stood out, among which Credit card loans stood out; with a 8% increase QoQ, meanwhile within commercial loans Others stood out with a 7% increase QoQ, mainly driven by the 24% loans to SMEs.

 

• In 3Q20, Banco Macro’s total deposits increased 13% or Ps.55.6 billion QoQ, totaling Ps.493 billion and representing 83% of the Bank’s total liabilities. Private sector deposits increased 4% or Ps.14.2 billion QoQ.

 

• Banco Macro continued showing a strong solvency ratio, with an excess capital of Ps.116.9 billion, 34.8% regulatory capital ratio – Basel III and 27.3% Tier 1 Ratio. In addition, the Bank’s liquid assets remained at an adequate level, reaching 87% of its total deposits in 3Q20.

 

• In 3Q20, the Bank’s non-performing to total financing ratio was 1.14% and the coverage ratio improved to 302.9%.

 

 3Q20 Earnings Release Conference Call

 

Tuesday, December 1, 2020
Time: 10:00 a.m. Eastern Time | 12:00 p.m. Buenos Aires Time

 

  

 IR Contacts in Buenos Aires:

 

Jorge Scarinci

Chief Financial Officer

 

Nicolás A. Torres

Investor Relations

 

Phone: (54 11) 5222 6682

E-mail: investorelations@macro.com.ar

 

Visit our website at:
www.macro.com.ar/relaciones-inversores

 

 To participate, please dial:

Argentina Toll Free:

(011) 3984 5677

Participants Dial In (Toll Free):

+1 (844) 450 3847

Participants International Dial In:

+1 (412) 317 6370

Conference ID: Banco Macro

Webcast: click here

  

 

 

 

Webcast Replay: click here

 

Available from 12/01/2020 through 12/15/2020

  

 

2 

 

 

    3Q20 Earnings Release

 

Disclaimer

 

This press release includes forward-looking statements. We have based these forward-looking statements largely on our current beliefs, expectations and projections about future events and financial trends affecting our business. Many important factors could cause our actual results to differ substantially from those anticipated in our forward-looking statements, including, among other things: inflation; changes in interest rates and the cost of deposits; government regulation; adverse legal or regulatory disputes or proceedings; credit and other risks of lending, such as increases in defaults by borrowers; fluctuations and declines in the value of Argentine public debt; competition in banking and financial services; deterioration in regional and national business and economic conditions in Argentina; and fluctuations in the exchange rate of the peso.

 

The words “believe,” “may,” “will,” “aim,” “estimate,” “continue,” “anticipate,” “intend,” “expect” and similar words are intended to identify forward-looking statements. Forward-looking statements include information concerning our possible or assumed future results of operations, business strategies, financing plans, competitive position, industry environment, potential growth opportunities, the effects of future regulation and the effects of competition. Forward-looking statements speak only as of the date they were made, and we undertake no obligation to update publicly or to revise any forward-looking statements after we distribute this press release because of new information, future events or other factors. In light of the risks and uncertainties described above, the forward-looking events and circumstances discussed in this press release might not occur and are not guarantees of future performance.

 

This report is a summary analysis of Banco Macro's financial condition and results of operations as of and for the period indicated. For a correct interpretation, this report must be read in conjunction with all other material periodically filed with the Comisión Nacional de Valores (www.cnv.gob.ar), the Securities and Exchange Commission (www.sec.gov), Bolsas y mercados Argentinos (www.byma.com.ar) and the New York Stock Exchange (www.nyse.com). In addition, the Central Bank (www.bcra.gov.ar) may publish information related to Banco Macro as of a date subsequent to the last date for which the Bank has published information.

 

Readers of this report must note that this is a translation made from an original version written and expressed in Spanish. Consequently, any matters of interpretation should be referred to the original version in Spanish.

 

3 

 

 

    3Q20 Earnings Release

 

This Earnings Release has been prepared in accordance with the accounting framework established by the Central Bank of Argentina (“BCRA”), based on International Financial Reporting Standards (“I.F.R.S.”) and the resolutions adopted by the International Accouting Standards Board (“I.A.S.B”) and by the Federación Argentina de Consejos Profesionales de Ciencias Económicas (“F.A.C.P.E.”). As of January 2020 the Bank started reporting with the application of (i) Expected losses of IFRS 9 “Financial Instruments” and (ii) IAS 29 “Financial Reporting in Hyperinflationary Economies”. Data and figures shown in this Earnings Release may differ from the ones shown in the 20-F annual report.

 

Results

 

Earnings per outstanding share were Ps.9.51 in 3Q20, 12% lower than 2Q20 and 33% lower than the result posted a year ago.

 

EARNINGS PER SHARE  MACRO Consolidated  Change 
In MILLION $ (Measuring Unit Current at EOP)   3Q19   4Q19   1Q20   2Q20   3Q20   QoQ    YoY 
Net income -Parent Company- (M $)   9,112   6,956   8,025   6,885   6,076   -12%   -33%
Average # of shares outstanding (M)   639   639   639   639   639   0%   0%
Average #of treasury stocks (shares repurchased) (M)   19   -   -   -   -   -    -100%
Book value per avg. Outstanding share ($)   184   201   211   201   210   4%   14%
Shares Outstanding (M)   639   639   639   639   639   0%   0%
Earnings per avg.  outstanding share ($)   14.26   10.89   12.56   10.77   9.51   -12%   -33%
                               
EOP FX (Pesos per USD)   57.5583   59.8950   64.4700   70.4550   76.1750   8%   32%
Book value per avg. issued ADS (USD)   31.97   33.56   32.73   28.53   27.57   -3%   -14%
Earnings per avg. outstanding ADS (USD)   2.48   1.82   1.95   1.53   1.25   -18%   -50%

 

Banco Macro’s 3Q20 net income of Ps.6.1      billion was 12% or Ps.809 million lower than the previous quarter and 33% or Ps.3 billion lower YoY. This result represented an accumulated ROAE and ROAA of 21.5% and 4.6% respectively.

 

Net operating income (before G&A and personnel expenses) was Ps.19.6 billion in 3Q20, decreasing 18% or Ps.4.3 billion compared to 2Q20 and decreased 5% or Ps.1.1 billion compared to the previous year.

 

In 3Q20 Provision for loan losses totaled Ps.1.8 billion, 31% or Ps.774 million lower than in 2Q20. In the previous quarter loan loss provisions were explained by additional provisions made by the Bank based on estimations of the macroeconomic impact of the current Covid-19 pandemic. In this quarter three main groups showing signs of credit deterioration were included in the estimates; i) Ps.617 million related to loans with deferred installments (both commercial and consumer), ii) Ps.600 million related to refinancing of outstanding credit card balances and iii) Ps.531 million related to the 24% loans extended to SMEs, from sectors or activities which the Bank considered troubled o likely to have some trouble.

 

Operating income (after G&A and personnel expenses) was Ps.4.4 billion in 3Q20, 52% or Ps.4.8 billion lower than in 2Q20 and Ps.4.5 billion higher than a year ago.

 

It is important to emphasize that this result was obtained with a leverage of only 5.5x assets to equity ratio.

 

4 

 

 

  3Q20 Earnings Release

 

INCOME STATEMENT  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)  3Q19   4Q19   1Q20   2Q20   3Q20   QoQ   YoY 
Net Interest Income   28,731    28,958    24,164    21,576    21,159    -2%   -26%
Net fee income   5,395    5,237    5,027    5,004    5,271    5%   -2%
Net Interest Income + Net Fee Income   34,126    34,195    29,191    26,580    26,430    -9%   -17%
Net Income from financial instruments at fair value through P&L   -16,732    -315    -4,643    -2,163    -7,541    249%   -55%
Income from assets at amortized cost   0    66    967    20    61    205%   - 
Differences in quoted prices of gold and foreign currency   2,138    1,670    604    846    1,207    43%   -44%
Other operating income   1,510    1,147    1,247    1,145    1,182    3%   -22%
Provision for loan losses   393    1,776    977    2,523    1,749    -31%   345%
Net Operating Income   20,649    34,987    26,389    23,905    19,590    -9%   27%
Employee benefits   6,350    6,339    5,361    6,174    6,199    0%   -2%
Administrative expenses   4,153    4,190    3,034    3,126    3,400    9%   -18%
Depreciation and impairment of assets   956    950    948    992    1,015    2%   6%
Other operating expenses   9,334    5,879    4,905    4,412    4,587    4%   -51%
Operating Income   -144    17,629    12,141    9,201    4,389    -24%   - 
Result from associates & joint ventures   24              9    15    67%   -38%
Result from net monetary postion   8,185    32    23    479    4,836    910%   -41%
Result before taxes from continuing operations   8,065    -5,644    335    9,689    9,240    -22%   20%
Income tax   -1,047    12,017    12,499    2,804    3,164    13%   -402%
Net income from continuing operations   9,112    5,061    4,474    6,885    6,076    -14%   111%
         -    -                     
Net Income of the period   9,112    6,956    8,025    6,885    6,076    -14%   111%
Net income of the period attributable to parent company   9,112    6,956    8,025    6,885    6,076    -12%   -33%
Net income of the period attributable to minority interest   0    -    -    0    0    -    - 

 

The Bank’s 3Q20 net interest income totaled Ps.21.2 billion, 2% or Ps.417 million lower than in 2Q20 and 26% or Ps.7.6 billion lower YoY.

 

In 3Q20 interest income totaled Ps.36.8 billion, 15% or Ps.4.9 billion higher than in 2Q20 (due to higher income from securities) and 28% or Ps.14.3 billion lower than in 3Q19.

 

Income from interest on loans and other financing totaled Ps.17.8 billion, 9% or Ps.1.7 billion lower compared with the previous quarter, due to a 155 b.p. decrease in the average lending rate (down from 31.5% in 2Q20 to 30% in 3Q20), while the average volume of private sector loans decreased 5%. On a yearly basis Income from interest on loans decreased 23% or Ps.5.4 billion.

 

In 3Q20 income from government and private securities increased 56% or Ps.6 billion QoQ (due to higher income from Government securities) and increased 39% or Ps.11 billion compared with the same period of last year. This result is explained 90% by income from government and private securities through other comprehensive income (Central Bank Notes) and the remaining 10% is explained by income from government and private securities at amortized cost.

 

In 3Q20 income from Repos totaled Ps.2.1 billion, 33% or Ps.525 million higher than the previous quarter and Ps.2 billion higher than a year ago.

 

In 3Q20 FX income totaled a Ps.1.2 billion gain, due to the 8% argentine peso depreciation against the US dollar and the Bank’s long spot dollar position during the quarter and FX trading results (Ps.457 million).

 

5 

 

 

  3Q20 Earnings Release

 

FX INCOME  MACRO Consolidated   Variation 
In MILLION $ (Measuring Unit Current at EOP)  3Q19   2Q20   3Q20   QoQ   YoY 
(1) Differences in quoted prices of gold and foreign currency   2,138    846    1,207    43%   -44%
Translation of FX assets and liabilities to Pesos   481    683    750    10%   56%
Income from foreign currency exchange   1,656    162    457    181%   -72%
                          
(2) Net Income from financial assets and liabilities at fair value through P&L   1,062    20    2    -90%   -100%
Income from investment in derivative financing instruments   1,062    20    2    -90%   -100%
                          
(1) +(2) Total Result from Differences in quoted prices of gold and foreign currency   3,200    866    1,209    40%   -62%

 

INTEREST INCOME  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)  3Q19   4Q19   1Q20   2Q20   3Q20   QoQ   YoY 
Interest on Cash and due from Banks   125    84    69    15    29    93%   -77%
Interest from government securities   27,357    11,458    11,850    10,490    16,633    59%   -39%
Interest from private securities   520    1,223    662    373    264    -29%   -49%
Interest on loans and other financing                                   
To the financial sector   540    559    286    269    196    -27%   -64%
To the public non financial sector   103    348    630    418    509    22%   394%
Interest on overdrafts   4,783    8,856    4,608    3,081    1,443    -53%   -70%
Interest on documents   1,383    1,599    1,444    983    796    -19%   -42%
Interest on mortgages loans   2,114    2,844    2,039    1,605    1,552    -3%   -27%
Interest on pledged loans   185    160    121    104    105    1%   -43%
Interest on personal loans   8,870    8,158    7,553    7,507    7,156    -5%   -19%
Interest on credit cards loans   3,730    3,670    3,104    2,455    2,505    2%   -33%
Interest on financial leases   40    36    25    13    4    -69%   -90%
Interest on other loans   1,363    2,005    2,261    2,979    3,494    17%   156%
Interest on Repos                                   
From the BCRA   0    480    365    1,578    2,094    33%   - 
Other financial institutions   11    411    47    1    10    900%   -9%
Total Interest income   51,124    41,891    35,064    31,871    36,790    15%   -28%
                                    
Income from Interest on loans   23,111    28,235    22,071    19,414    17,760    -9%   -23%

 

The Bank’s 3Q20 interest expense totaled Ps.15.6 billion, increasing 52% or Ps.5.3 billion compared to the previous quarter and decreasing 30% (Ps.6.8 billion) compared to 3Q19.

 

In 3Q20, interest on deposits represented 94% of the Bank’s total interest expense, increasing 58% or Ps.5.4 billion QoQ, due to a 300 b.p. increase in the average rate paid on deposits (up from 13.6% in 2Q20 to 16.6% in 3Q20, this increase can be traced to a 458 b.p QoQ increase in the average Badlar rate). The average volume of deposits from the private sector increased 13%. On a yearly basis, interest on deposits decreased 28% or Ps.5.8 billion.

 

6 

 

 

  3Q20 Earnings Release

 

INTEREST EXPENSE  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)  3Q19   4Q19   2Q20   2Q20   3Q20   QoQ   YoY 
Deposits                                   
Interest on checking accounts   152    34    136    120    424    253%   179%
Interest on saving accounts   164    230    165    133    124    -7%   -24%
Interest on time deposits   20,153    11,710    9,632    9,069    14,155    56%   -30%
Interest on other financing from BCRA and financial inst.   90    59    25    15    17    13%   -81%
Repos                                   
Other financial institutions   77    40    74    22    2    -91%   -97%
Interest on corporate bonds   1,136    247    323    386    348    -10%   -69%
Interest on subordinated bonds   553    547    520    536    552    3%   0%
Interest on other financial liabilities   68    66    25    14    9    -36%   -87%
Total financial expense   22,393    12,933    10,900    10,295    15,631    52%   -30%
                                    
Expenses from interest on deposits   20,469    11,974    9,933    9,322    14,703    58%   -28%

 

As of 3Q20, the Bank’s accumulated net interest margin (including FX) was 20.3%, lower than the 22.3% posted in 2Q20 and the 21.5% posted in 3Q19.

 

In 3Q20 Net Interest Margin (excluding FX) was 19.5%, lower than the 21.6% posted in 2Q20 and than the 20.8% posted in 3Q19.

 

In 3Q20 Net Interest Margin (Pesos) was 18.6%, lower than the 23% posted in 2Q20 and than the 34.3% in 3Q19; meanwhile Net Interest Margin (USD) was 1.8%, lower than the 2.3% posted in 2Q20 and higher than the 0.6% registered in 3Q19.

 

ASSETS & LIABILITIES
PERFORMANCE (AR$)		  MACRO Consolidated 
In MILLION $  3Q19   4Q19   1Q20   2Q20   3Q20 
(Measuring Unit Current at EOP)   AVERAGE    REAL INT    NOMINAL    AVERAGE    REAL INT    NOMINAL    AVERAGE    REAL INT    NOMINAL    AVERAGE    REAL INT    NOMINAL    AVERAGE    REAL INT    NOMINAL 
Yields & rates in annualized nominal %   BALANCE    RATE    INT RATE    BALANCE    RATE    INT RATE    BALANCE    RATE    INT RATE    BALANCE    RATE    INT RATE    BALANCE    RATE    INT RATE 
Interest-earning assets                                                                           
Loans & Other Financing                                                                           
      Public Sector   2,094    -20.1%   19.5%   3,512    -4.9%   39.3%   7,065    3.4%   35.9%   6,749    2.7%   24.9%   5,025    7.5%   40.3%
      Financial Sector   4,063    1.7%   52.1%   4,062    5.1%   54.0%   2,403    11.4%   46.4%   2,547    17.0%   42.3%   1,927    7.5%   40.3%
      Private Sector   170,025    -0.1%   49.4%   212,840    1.2%   48.2%   191,320    7.6%   41.4%   199,761    11.3%   35.4%   201,621    1.0%   31.8%
Other debt securities                                                                           
      Central Bank Securities (Leliqs)   133,981    15.5%   72.7%   27,756    37.2%   101.0%   82,013    10.9%   45.7%   91,354    13.1%   37.5%   121,719    5.4%   37.5%
      Government & Private Securities   19,159    12.7%   68.5%   25,407    27.8%   87.2%   22,875    18.7%   55.9%   30,733    7.3%   30.5%   72,175    -0.6%   29.7%
Repos   46    30.3%   94.9%   4,372    23.5%   80.9%   3,786    9.5%   43.8%   36,760    -3.5%   17.3%   43,732    -8.7%   19.1%
Total interest-earning assets   329,368    6.8%   59.8%   277,949    7.6%   57.6%   309,462    9.3%   43.6%   367,904    9.9%   33.6%   446,199    1.1%   31.9%
                                                                            
Non interest-earning assets   71,723              112,387              102,340              110,445              69,832           
Total Average Assets   401,091              390,336              411,802              478,349              516,031           
                                                                            
Interest-bearing liabilities                                                                           
Deposits                                                                           
      Public Sector   17,422    -8.6%   36.7%   9,775    -5.1%   39.0%   13,159    -4.6%   25.3%   19,698    -0.3%   21.3%   52,140    -4.3%   24.8%
      Private Sector   200,446    -8.9%   36.2%   148,160    -12.0%   28.9%   160,855    -6.9%   22.3%   192,661    -3.8%   17.0%   224,237    -7.9%   20.2%
BCRA and other financial institutions   697    1.9%   52.4%   266    32.4%   94.0%   390    -4.2%   25.8%   427    -3.8%   17.0%   408    -7.6%   20.5%
Corporate bonds   8,311    3.1%   54.2%   7,035    -22.3%   13.9%   6,188    -7.9%   21.0%   5,206    6.7%   29.8%   4,963    -2.0%   27.9%
Repos   488    8.7%   62.6%   317    2.5%   50.1%   1,305    -6.1%   23.4%   939    -10.0%   9.4%   49    -10.9%   16.2%
Total int.-bearing liabilities   227,364    -8.4%   37.0%   165,553    -11.9%   29.0%   181,897    -6.8%   22.5%   218,931    -3.2%   17.7%   281,797    -7.1%   21.2%
                                                                            
Total non int.-bearing liabilities   84,179              106,478              106,002              139,133              148,631           
                                                                            
Total Average Liabilities   311,543              272,031              287,899              358,064              430,428           
                                                                            
Assets Performance        49,668              40,321              33,516              30,703              35,798      
Liabilities Performance        21,195              12,103              10,188              9,620              14,983      
Net Interest Income        28,473              28,218              23,328              21,083              20,815      
Total interest-earning assets        329,368              277,949              309,462              367,904              446,199      
Net Interest Margin (NIM)        34.3%             40.3%             30.3%             23.0%             18.6%     

 

7 

 

 

    3Q20 Earnings Release

 

ASSETS & LIABILITIES
PERFORMANCE USD
In MILLION $		  MACRO Consolidated 
(Measuring Unit Current at EOP)  3Q19   4Q19   1Q20   2Q20   3Q20 
Yields & rates in annualized  AVERAGE   REAL INT   NOMINAL   AVERAGE   REAL INT   NOMINAL   AVERAGE   REAL INT   NOMINAL   AVERAGE   REAL INT   NOMINAL   AVERAGE   REAL INT   NOMINAL 
nominal %  BALANCE    RATE    INT RATE    BALANCE   RATE    INT RATE    BALANCE    RATE    INT RATE    BALANCE    RATE    INT RATE    BALANCE    RATE    INT RATE  
Interest-earning assets                                                            
Cash and Deposits in Banks   84,692    62.3%   0.6%   33,313    -20.0%   1.0%   34,930    0.3%   0.8%   43,510    13.0%   0.1%   44,600    1.7%   0.3%
Loans & Other Financing                                                                           
Public Sector   0    0.0%   0.0%   0    0.0%   0.0%   0    0.0%   0.0%   0    0.0%   0.0%   0    0.0%   0.0%
Financial Sector   399    71.0%   6.0%   385    -15.8%   6.2%   522    6.4%   6.9%   68    19.6%   5.9%   56    8.6%   7.1%
Private Sector   80,918    71.6%   6.4%   48,321    -11.3%   11.9%   47,780    11.6%   12.2%   39,305    26.1%   11.7%   24,878    16.8%   15.2%
Other debt securities                                                                           
Government & Private Securities   0    0.0%   0.0%   2,104    -16.9%   4.9%   3,174    1.7%   2.2%   4,447    13.5%   0.5%   4,583    2.5%   1.1%
Total interest-earning assets   166,009    66.9%   3.5%   84,123    -14.9%   7.4%   86,406    6.7%   7.2%   87,330    19.0%   5.4%   74,117    6.8%   5.3%
                                                                            
Non interest-earning assets   10,384              55,971              49,517              45,092              93,032           
Total Average Assets   176,393              140,094              135,923              132,422              167,149           
                                                                            
Interest-bearing liabilities                                                                           
Deposits                                                                           
Public Sector   2,484    64.4%   1.9%   1,309    -18.6%   2.7%   2,244    0.6%   1.1%   1,418    13.9%   0.9%   776    1.9%   0.5%
Private Sector   104,037    64.8%   2.2%   65,184    -19.6%   1.4%   64,143    0.5%   1.0%   51,370    14.1%   1.0%   50,346    2.1%   0.7%
BCRA and other financial institutions   3,569    70.0%   5.4%   3,159    -16.1%   5.9%   1,443    5.9%   6.4%   647    20.6%   6.8%   511    6.9%   5.4%
Subordinated bonds   28,095    73.9%   7.8%   31,038    -15.2%   7.0%   29,314    6.6%   7.1%   30,213    20.9%   7.1%   30,809    8.6%   7.1%
Total int.-bearing liabilities   138,185    66.8%   3.4%   100,690    -18.1%   3.3%   97,144    2.4%   2.9%   90,236    2.4%   3.0%   82,442    4.6%   3.1%
                                                                            
Total non int.-bearing liabilities   32,532              31,385              31,258              40,153              39,213           
                                                                            
Total Average liabilities   170,717              132,075              128,402              123,801              121,655           
                                                                            
Assets Performance        1,456              1,570              1,548              1,168              992      
Liabilities Performance        1,198              830              712              675              650      
Net Interest Income        258              740              836              493              342      
Total interest-earning assets        166,009              84,123              86,406              87,330              74,117      
Net Interest Margin (NIM)        0.6%             3.5%             3.9%             2.3%             1.8%     

 

In 3Q20 Banco Macro’s net fee income totaled Ps.5.3 billion, 5% or Ps.267 million higher than in 2Q20 and 2% or Ps.124 million lower than the same period of last year.

 

In the quarter, fee income totaled Ps.5.7 billion, 6% or Ps.340 million higher than in 2Q20. Fees charged on deposit accounts, Corporate Services fees and ATM transaction fees stand out; with an 8% and 20% and 15% increase respectively QoQ. On a yearly basis, fee income decreased 4% or Ps.209 million.

 

In the quarter, total fee expense increased 19% or Ps.73 million. On a yearly basis, fee expenses decreased 15% or Ps.85 million.

 

NET FEE INCOME  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)   3Q19   4Q19   1Q20   2Q20   3Q20   QoQ    YoY 
Fees charged on deposit accounts   2,338    2,042    2,018    2,060    2,223    8%   -5%
Credit card fees   1,286    1,166    1,219    1,107    1,152    4%   -10%
Corporate services fees   709    686    611    460    551    20%   -22%
ATM transactions fees   326    498    459    445    512    15%   57%
Insurance fees   331    336    350    361    359    -1%   8%
Debit card fees   319    291    286    323    349    8%   9%
Financial agent fees (Provinces)   274    410    271    277    279    1%   2%
Credit related fees   248    197    172    226    131    -42%   -47%
Mutual funds & securities fees   72    79    96    109    151    39%   110%
AFIP & Collection services   32    72    27    17    20    18%   -38%
ANSES fees   12    14    13    13    11    -15%   -8%
Total fee income   5,947    5,791    5,522    5,398    5,738    6%   -4%
                                    
Total fee expense   552    554    495    394    467    19%   -15%
                                    
Net fee income   5,395    5,237    5,027    5,004    5,271    5%   -2%

 

In 3Q20 Net Income from financial assets and liabilities at fair value through profit or loss totaled a Ps.7.5 billion loss, higher than the Ps.2.1 billion loss posted in the previous quarter. This loss can be traced to a higher loss related to sale of financial assets at fair value as a consequence of the inflation adjustment applied to our Leliq holdings (higher inflation was observed during 3Q20) which was partially offset by a Ps.422 million increase in profit from government securities.

 

8 

 

 

    3Q20 Earnings Release

 

NET INCOME FROM FINANCIAL ASSETS AND LIABILITIES
AT FAIR VALUE THROUGH PROFIT OR LOSS		  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)   3Q19   4Q19   1Q20   2Q20   3Q20   QoQ    YoY 
Profit or loss from government securities   -535    2,498    1,508    2,170    2,592    19%   - 
Profit or loss from private securities   189    337    257    111    273    146%   44%
Profit or loss from investment in derivative
financing instruments		   1,062    292    41    20    2    -90%   -100%
Profit or loss from other financial assets   14    64    -7    12    -4    -    - 
Profit or loss from investment in equity instruments   -14    17    103    87    -107    -    664%
Profit or loss from the sale of financial assets at fair value   -17,448    -3,523    -6,545    -4,563    -10,297    126%   -41%
Income from financial assets at fair value through profit or loss   -16,732    -315    -4,643    -2,163    -7,541    249%   -55%
                                    
Profit or loss from derivative financing instruments   0    0    0    0    0    -    - 
Income from financial liabilities at fair value through profit or loss   0    0    0    0    0    -    - 
                                    
NET INCOME FROM FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS   -16,732    -315    -4,643    -2,163    -7,541    249%   -55%

 

In the quarter Other Operating Income totaled Ps.1.2 billion, 3% or Ps.37 million higher than in 2Q20. On a yearly basis Other Operating Income decreased 22% or Ps.328.

 

OTHER OPERATING INCOME  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)   3Q19   4Q19   1Q20   2Q20   3Q20   QoQ    YoY 
Credit and debit cards   63    55    28    18    28    56%   -56%
Lease of safe deposit boxes   132    141    152    178    194    9%   47%
Other service related fees   453    340    547    390    436    12%   -4%
Other adjustments and interest
from other receivables		   234    233    229    184    188    2%   -20%
Initial recognition of loans   -12    45    0    19    -12    -    0%
Sale of property, plant and equipment   0    0    0    0    6    -    - 
Others   640    333    291    356    342    -4%   -47%
Other Operating Income   1,201    1,147    1,247    1,158    1,064    -8%   -11%

 

In 3Q20 Banco Macro’s administrative expenses plus employee benefits totaled Ps.9.6 billion, 3% or Ps.299 million higher than the previous quarter, due to higher administrative expenses (9%). On a yearly basis administrative expenses plus employee benefits decreased 9% or Ps.904 million.

 

Employee benefits increased Ps.25 million QoQ (remunerations and social security contributions were 1% lower but were offset by higher compensation a bonuses and employee services which increased 11% and 49% respectively QoQ). On a yearly basis Employee benefits decreased 2% or Ps.151 million.

 

In 3Q20 administrative expenses increased 9% or Ps.274 million, due to higher other administrative expenses (38% or Ps.329 million) related to legal expenses which were partially offset by lower (14% or Ps.44 million) Directors and auditors fees.

 

In 3Q20, the efficiency ratio reached 45.9%, deteriorating from the 41.6% posted in 2Q20. In 3Q20 expenses (employee benefits + G&A expenses + depreciation and impairment of assets) increased 3%, while income (net interest income + net fee income + differences in quoted prices of gold and foreign currency + other operating income + net income from financial assets at fair value through profit or loss – (Turnover Tax + Insurance on deposits)) decreased 22% compared to 2Q20.

 

9 

 

 

    3Q20 Earnings Release

 

If we had excluded from the efficiency ratio calculation the inflation adjustment on our Leliqs holding (as per Central Bank rules shown under profit/loss from financial instruments at fair value through P&L), efficiency ratio would have been 34.7% in 3Q20 and 33.7% in 2Q20

 

PERSONNEL & ADMINISTRATIVE EXPENSES  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)   3Q19   4Q19   1Q20   2Q20   3Q20   QoQ    YoY 
Employee benefits   6,350    6,339    5,361    6,174    6,199    0%   -2%
              Remunerations   4,536    4,601    3,951    4,667    4,617    -1%   2%
              Social Security Contributions   961    1,043    878    1,039    1,024    -1%   7%
              Compensation and bonuses   691    527    414    370    412    11%   -40%
              Employee services   162    168    118    98    146    49%   -10%
Administrative Expenses   4,153    4,190    3,034    3,126    3,400    9%   -18%
              Taxes   464    450    436    392    405    3%   -13%
              Maintenance, conservation fees   480    626    460    493    508    3%   6%
              Directors & statutory auditors fees   790    717    344    308    264    -14%   -67%
              Security services   363    364    333    323    310    -4%   -15%
              Electricity & Communications   348    366    353    352    341    -3%   -2%
              Other professional fees   313    323    208    194    205    6%   -35%
              Rental agreements   55    52    26    29    10    -66%   -82%
              Advertising & publicity   149    195    66    88    75    -15%   -50%
              Personnel allowances   62    59    38    23    25    9%   -60%
              Stationary & Office Supplies   39    25    22    20    21    5%   -46%
              Insurance   39    38    29    41    42    2%   8%
              Hired administrative services   3    0    1    0    2    -    -33%
             Other   1,048    975    718    863    1,192    38%   14%
Total Administrative Expenses   10,503    10,529    8,395    9,300    9,599    3%   -9%
                                    
Total Employees   8,843    8,768    8,732    8,706    8,651           
Branches   462    463    463    463    463           
Efficiency ratio   64.3%   34.5%   39.8%   43.3%   57.1%          
                                    
Accumulated efficiency ratio   60.3%   50.7%   39.8%   41.6%   45.9%          

 

In 3Q20, Other Operating Expenses totaled Ps.4.6 billion, increasing 4% or Ps.175 million QoQ. Others and Other provision charges stand out with a 9% (Ps.132 million) increase and a 25% (Ps.52 million) increase respectively QoQ. On a yearly basis Other Operating Expenses decreased 51% or Ps.4.7 billion.

 

OTHER OPERATING EXPENSES  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)   3Q19   4Q19   1Q20   2Q20   3Q20   QoQ    YoY 
Turnover Tax   3,034    3,325    2,773    2,506    2,493    -1%   -18%
Other provision charges   660    389    341    210    262    25%   -60%
Deposit Guarantee Fund Contributions   194    141    137    155    184    19%   -5%
Donations   52    170    123    24    0    -100%   -100%
Insurance claims   19    19    17    17    13    -24%   -32%
Initial loan recognition   0    0    3    -3    0    -    - 
Others   5,375    1,834    1,511    1,503    1,635    9%   -70%
Other Operating Expenses   9,334    5,879    4,905    4,412    4,587    4%   -51%

 

In 3Q20 the result from the net monetary position (excluding Leliqs) totaled a Ps.4.8 million gain, Ps.4.4 billion higher than the Ps.479 million gain posted in 2Q20. This result is explained by the breakdown of monetary assets and monetary liabilities and their behavior during the quarter; an increase in monetary assets (loans, and government securities) and a bigger increase in monetary liabilities (deposits), and higher inflation observed during the quarter (228 b.p. above 2Q20 level, up from 5.37% to 7.65%) generating a positive result. If we include the inflation adjustment on our Leliqs holdings (a Ps.8.3 billion loss) the total result from the monetary position (including Leliqs) would be a Ps.3.4 billion loss, lower than the Ps.3.8 billion loss posted in 2Q20. On a yearly basis result from net monetary position (exc. Leliqs) decreased 41% or Ps.3.4 billion.

 

10 

 

 

    3Q20 Earnings Release

 

In 3Q20 Banco Macro's effective income tax rate 34.2%, higher than the 28.9% effective tax rate of 2Q20.

 

RESULT FROM NET MONETARY POSITION   BANCO MACRO 
In MILLION $ (Measuring Unit Current at EOP)   1Q20   2Q20   3Q20
Result from Net Monetary Position (Consolidated)   335    479    4,836 
Change in Consumer Price Index   7.7995%   5.3746%   7.6549%
                
RECPPC MONETARY ASSETS & LIABILITIES (*)               
Monetary Assets (MA)               
Cash and deposits in banks   -8,281    -6,212    -8,093 
Government and private securities   -1,805    -1,221    -2,745 
Loans   -18,718    -13,048    -17,367 
Other financial assets   -871    -2,544    -5,479 
Other receivables   -629    -425    -636 
Investment in other companies             -33 
Others   -43    -30      
Total RECPPC Monetary Assets   -30,346    -23,480    -34,353 
                
Monetary Liabilities (ML)               
Deposits   24,452    19,249    32,300 
Other financial liabilities   2,391    1,546    2,250 
Other liabilities   1,554    1,511    2,286 
Subordinated Corporte Bonds   2,205    1,586    2,272 
Others   10    11    18 
Provisions   135    93    126 
Total RECPPC Monetary Liabilities   30,747    23,995    39,252 
                
Result from Net Monetary Position   401    516    4,899 
                
RECPPC Leliqs   -6,389    -4,274    -8,327 
Result from Net Monetary Position (inc. Leliqs)   -5,988    -3,758    -3,428 
                
RECPPC: Result from changes in purchasing power of currency               
(*)Banco Macro, not consolidated               

 

Financial Assets

 

Private sector financing

 

The volume of “core” financing to the private sector (including loans, financial trust and leasing portfolio) totaled Ps.232.2 billion, decreasing 2% or Ps.3.9 billion QoQ and 12% or Ps.31.9 billion YoY.

 

Within commercial loans, Others stand out with a 7% or Ps.2.8 billion increase QoQ (mostly due to loans extended to SMEs at a 24% interest rate, as part of the relief package given the Covid-19 pandemic); meanwhile Overdrafts decreased 22% or Ps.4.9 billion.

 

Within consumer lending credit card loans increased 8% or Ps.3.7 billion QoQ.

 

Within private sector financing, peso financing increased 2% or Ps.4.7million, while US dollar financing decreased 32% or USD 147 million.

 

As of 3Q20, Banco Macro´s market share over private sector loans was 7.6%.

 

11 

 

 

  3Q20 Earnings Release

 

FINANCING TO THE PRIVATE SECTOR  MACRO Consilidated   Change 
In MILLION $ (Measuring Unit Current at EOP)  3Q19   4Q19   1Q20   2Q20   3Q20   QoQ   YoY 
Overdrafts   38,433    45,416    36,483    22,040    17,189    -22%   -55%
Discounted documents   29,605    24,038    25,986    23,523    21,361    -9%   -28%
Mortgage loans   17,685    15,579    14,475    13,962    13,652    -2%   -23%
Pledged loans   6,159    4,900    4,223    3,971    3,618    -9%   -41%
Personal loans   76,781    67,978    65,341    62,186    60,610    -3%   -21%
Credit Card loans   45,233    51,553    50,239    48,941    52,618    8%   16%
Others   32,933    27,694    31,630    41,268    44,099    7%   34%
Interest   13,848    18,921    17,760    18,139    17,360    -4%   25%
Total loan portfolio   260,677    256,079    246,137    234,030    230,507    -2%   -12%
                                    
Total loans in Pesos   186,975    210,117    201,850    203,155    208,098    2%   11%
                                    
Total loans in USD   73,702    45,962    44,287    30,875    22,409    -27%   -70%
Financial trusts   1,873    2,369    1,874    901    364    -60%   -81%
Leasing   399    281    223    167    133    -20%   -67%
Others   1,151    1,052    1,087    1,048    1,243    19%   8%
Total other financing   3,423    3,702    3,184    2,116    1,740    -18%   -49%
                                    
Total other financing in Pesos   2,050    2,441    2,090    1,029    798    -22%   -61%
                                    
Total other financing in USD   1,373    1,261    1,094    1,087    942    -13%   -31%
                                    
Total financing to the private sector   264,100    259,781    249,321    236,146    232,247    -2%   -12%
                                    
EOP FX (Pesos per USD)   57.5583    59.8950    64.4697    70.4550    76.1750    8%   32%
                                    
USD financing / Financing to the private sector   28%   18%   18%   14%   10%          

 

Public Sector Assets

 

In 3Q20, the Bank’s public sector assets (excluding LELIQs) to total assets ratio was 17.7%, higher than the 9.3% registered in the previous quarter, and higher than the 4.8% posted in 3Q19.

 

In 3Q20, a 124% or Ps.69.5 billion increase in Government Securities stands out, also in the quarter Leliqs increased 11% or Ps.13 billion. Since 2Q20 the Bank decided to invest in CER adjustable bonds and Badlar bonds.

 

PUBLIC SECTOR ASSETS  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)  3Q19   4Q19   1Q20   2Q20   3Q20   QoQ   YoY 
Leliqs   76,396    56,170    81,045    113,478    126,435    11%   65%
Other   26,430    26,073    23,883    55,962    125,441    124%   375%
Government securities   102,826    82,243    104,928    169,440    251,876    49%   145%
Provincial loans   464    7,717    4,585    6,809    3,889    -43%   738%
Loans   464    7,717    4,585    6,809    3,889    -43%   738%
Purchase of government bonds   150    139    137    140    139    -1%   -8%
Other receivables   150    139    137    140    139    -1%   -8%
                                    
TOTAL PUBLIC SECTOR ASSETS   103,440    90,099    109,650    176,389    255,904    45%   147%
                                    
TOTAL PUBLIC SECTOR ASSETS (net of LEBAC/NOBAC/LELIQ)   27,044    33,929    28,605    62,911    129,469    106%   379%
                                    
TOTAL PUBLIC SECTOR ASSETS (net of LEBAC/NOBAC/LELIQ)/TOTAL ASSETS   4.8%   6.3%   5.0%   9.3%   17.7%          

 

12 

 

 

  3Q20 Earnings Release

 

Funding

 

Deposits

 

Banco Macro’s deposit base totaled Ps.493 billion in 3Q20, increasing 13% or Ps.55.6 billion QoQ and 39% or Ps.138.6 billion increase YoY and representing 83% of the Bank’s total liabilities.

 

On a quarterly basis, both public and private sector deposits increased with a 64% or Ps.41.4 billion increase and a 4% or Ps.14.2 billion increase respectively.

 

The increase in private sector deposits was led by time deposits, which increased 17% or Ps.29.4 billion, while demand deposits decreased 6% or Ps.11.8 billion QoQ.

 

Within private sector deposits, peso deposits increased 6% or Ps.17.2 billion, while US dollar deposits decreased 11% or USD 124 million.

 

As of 3Q20, Banco Macro´s market share over private sector deposits was 6.6%.

 

DEPOSITS  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)  3Q19   4Q19   1Q20   2Q20   3Q20   QoQ   YoY 
Public sector   27,799    21,474    30,980    64,237    105,636    64%   280%
                                    
Financial sector   400    384    330    376    441    17%   10%
                                    
Private sector   325,921    299,597    321,849    372,483    386,633    4%   19%
Checking accounts   47,979    49,067    60,901    76,862    71,707    -7%   49%
Savings accounts   105,464    110,950    108,280    114,390    107,751    -6%   2%
Time deposits   162,960    129,710    144,396    169,744    199,177    17%   22%
Other   9,518    9,870    8,272    11,487    7,998    -30%   -16%
Total   354,120    321,455    353,159    437,096    492,710    13%   39%
                                    
Pesos   244,335    224,013    264,787    354,311    413,952    17%   69%
Foreign Currency (Pesos)   109,785    97,442    88,372    82,785    78,758    -5%   -28%
                                    
EOP FX (Pesos per USD)   57.5583    59.8950    64.4697    70.4550    76.1750    8%   32%
Foreign Currency (USD)   1,907    1,627    1,371    1,175    1,034    -12%   -46%
                                    
USD Deposits / Total Deposits   31%   30%   25%   19%   16%          

 

Banco Macro’s transactional deposits represent approximately 44% of its total deposit base as of 3Q20. These accounts are low cost and are not sensitive to interest rate increases.

 

Other sources of funds

 

In 3Q20, the total amount of other sources of funds increased 3% or Ps.5.6 billion compared to 2Q20. On a yearly basis other sources of funds increased 3% or Ps.4.6 billion. In 2Q20 Shareholder’s Equity increased 4% or Ps.5.6; also in the quarter subordinated corporate bonds increased 2% or Ps.648 due to the argentine peso depreciation.

 

OTHER SOURCES OF FUNDS  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)  3Q19   4Q19   1Q20   2Q20   3Q20   QoQ   YoY 
Central Bank of Argentina   42    33    18    20    19    -5%   -55%
Banks and international institutions   3,635    2,247    589    591    402    -32%   -89%
Financing received from Argentine financial institutions   891    465    372    540    266    -51%   -70%
Subordinated corporate bonds   32,415    29,730    30,182    30,846    31,530    2%   -3%
Corporate bonds   8,208    6,757    6,197    5,220    5,019    -4%   -39%
Shareholders' equity   121,326    128,229    135,073    128,325    133,922    4%   10%
Total other source of funds   166,517    167,461    172,431    165,542    171,158    3%   3%

 

13 

 

 

  3Q20 Earnings Release

 

Liquid Assets

 

In 3Q20, the Bank’s liquid assets amounted to Ps.429.9 billion, showing a 17% or Ps.63.8 billion increase QoQ, and a 79% or Ps.189.5 billion increase on a yearly basis.

 

In 3Q20, LELIQs own portfolio increased 11% or Ps.13 billion. Other government & private securities increased 124% or Ps.69.5 billion.

 

In 3Q20 Banco Macro’s liquid assets to total deposits ratio reached 87%.

 

LIQUID ASSETS  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)  3Q19   4Q19   1Q20   2Q20   3Q20   QoQ   YoY 
Cash   131,988    123,121    139,896    111,850    112,934    1%   -14%
Guarantees for compensating chambers   9,703    9,097    9,868    12,146    10,929    -10%   13%
Call   205    122    681    0    150    -    -27%
Leliq own portfolio   75,002    56,170    81,045    113,478    126,435    11%   69%
Net Repos   -2,961    104    465    72,635    53,971    -26%   - 
Other government & private securities   26,430    26,073    23,883    55,962    125,441    124%   375%
Total   240,367    214,687    255,838    366,071    429,860    17%   79%
                                    
Liquid assets to total deposits   68%   67%   72%   84%   87%          

 

Solvency

 

Banco Macro continued showing high solvency levels in 3Q20 with an integrated capital (RPC) of Ps.152.6 billion over a total capital requirement of Ps.35.7 billion. Banco Macro’s excess capital in 3Q20 was 327% or Ps.116.9 billion. Since the beginning of 2020 and due to inflation adjustments Equity has increased significantly leading to higher solvency levels (shown under Ordinary Capital Level 1).

 

The regulatory capital ratio (as a percentage of risk-weighted assets- RWA) was 34.8% in 3Q20; TIER1 Ratio stood at 27.3%.

 

The Bank’s aim is to make the best use of this excess capital.

 

MINIMUM CAPITAL REQUIREMENT  MACRO Consolidated   Change 
In MILLION $  3Q19(¹)   4Q19(¹)   1Q20(²)   2Q20(²)   3Q20(²)   QoQ   YoY 
Credit risk requirement   19,343    21,404    23,808    24,046    23,972    0%   24%
Market risk requirement   778    591    694    1,122    1,172    5%   51%
Operational risk requirement   6,627    7,563    8,606    9,493    10,604    12%   60%
Total capital requirements   26,748    29,558    33,108    34,660    35,749    3%   34%
                                    
Ordinary Capital Level 1 (COn1)   69,629    83,090    115,532    116,048    131,531    13%   89%
Deductible concepts Level 1 (COn1)   -7,807    -10,637    -12,442    -10,011    -11,768    18%   51%
Capital Level 2 (COn2)   24,972    26,113    26,427    30,427    32,854    8%   32%
Integrated capital - RPC (i)   86,793    98,566    129,517    136,464    152,618    12%   76%
                                    
Excess capital   60,045    69,008    96,409    101,804    116,869    15%   95%
                                    
Risk-weighted assets - RWA (ii)   327,312    361,678    405,179    424,501    438,129    3%   34%
                                    
Regulatory Capital ratio [(i)/(ii)]   26.5%   27.3%   32.0%   32.1%   34.8%          
                                    
Ratio TIER 1 [Capital Level 1/RWA]   18.9%   20.0%   25.4%   25.0%   27.3%          

 

RWA - (ii): Risk Weighted Assets, considering total capital requirements.

(¹) Figueres are not inflation adjusted. Expressed in Pesos current at end of each quarter

(²) Figures are inflaiton adjusted. Expressed in Pesos current at EOP

 

14 

 

 

  3Q20 Earnings Release

 

Asset Quality

 

In 3Q20, Banco Macro’s non-performing to total financing ratio (under Central Bank rules) reached a level of 1.14%, down from 1.52% in 2Q20, and down from the 1.9% posted in 3Q19.

 

Consumer portfolio non-performing loans improved 54b.p. (down to 0.96% from 1.5%) while Commercial portfolio non-performing loans were practically unchanged in 3Q20 (up to 1.55% from 1.54%).

 

Consumer portfolio non-performing loans ratio continues to be positively impacted by recent measures adopted by the Central Bank of Argentina in the current Covid19 pandemic context, particularly the 60 day grace period that was added to debtor classification before a loan is considered non performing and the possibility to refinance outstanding credit card balances.

 

The coverage ratio (measured as total allowances under Expected Credit Losses over Non Performing loans under Central Bank rules) improved to 302.94% in 3Q20. Write-offs over total loans totaled 0.25%.

 

The Bank is committed to continue working in this area to maintain excellent asset quality standards.

 

ASSET QUALITY  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)  3Q19   4Q19   1Q20   2Q20   3Q20   QoQ   YoY 
Commercial portfolio   121,370    127,331    112,709    87,981    76,034    -14%   -37%
  Non-performing   566    1,700    1,535    1,359    1,180    -13%   109%
Consumer portfolio   159,267    155,881    153,059    169,322    173,701    3%   9%
  Non-performing   4,768    4,170    2,082    2,547    1,667    -35%   -65%
Total portfolio   280,637    283,212    265,768    257,302    249,735    -3%   -11%
  Non-performing   5,334    5,870    3,617    3,906    2,847    -27%   -47%
Commercial non-perfoming ratio   0.47%   1.34%   1.36%   1.54%   1.55%          
Consumer non-perfoming ratio   2.99%   2.68%   1.36%   1.50%   0.96%          
                                    
Total non-performing/ Total portfolio   1.90%   2.07%   1.36%   1.52%   1.14%          
                                    
Total allowances   5,929    6,225    6,275    8,227    8,625    5%   45%
Coverage ratio w/allowances   111.15%   106.05%   173.49%   210.62%   302.94%          
Write Offs   1,134    753    592    546    631    16%   -44%
Write Offs/ Total portfolio   0.40%   0.27%   0.22%   0.21%   0.25%          

 

15 

 

 

    3Q20 Earnings Release

 

Expected Credit Losses (E.C.L) (I.F.R.S.9)

 

The Bank records an allowance for expected credit losses for all loans and other debt financial assets not held at fair value through profit or loss, together with loan commitments and financial guarantee contracts, in this section all referred to as ‘financial instruments’. Equity instruments are not subject to impairment under IFRS 9. The ECL allowance is based on the credit losses expected to arise over the life of the asset (the lifetime expected credit loss), unless there has been no significant increase in credit risk since origination, in which case, the allowance is based on the 12 months expected credit loss.(For further information please see our 2019 20-F)

 

The table below shows, under the E.C.L model, the allowances for credit losses with their respective classification in stages, and the impact the transition to I.F.R.S. 9 has on earnings.

 

Transition to I.F.R.S.9  (BOP Jan 1,2019)    
IN MILLION $ (Measuring Unit Current at end of 3Q20)     
Allowances under BCRA rules   7,827 
Re-measurement of financial inst.   -529 
ECL under I.F.R.S9 (Jan 2019)   7,298 
      
Expected Credit Losses (ECL) - 2020 Evolution     
      
ECL under I.F.R.S.9 EOP 4Q19   6,235 
12months ECL (Stage 1)   2,156 
Financial inst. with increased credit risk (Stage 2)   1,121 
Financial inst. considered credit impaired (Stage 3)   250 
Monetary result generated by allowances   -1,137 
ECL under I.F.R.S.9 EOP 3Q20   8,625 

 

16 

 

 

    3Q20 Earnings Release

 

CER Exposure and Foreign Currency Position

 

CER EXPOSURE  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)   3Q19   4Q19   1Q20   2Q20   3Q20   QoQ    YoY 
CER adjustable ASSETS                                   
                                    
Government Securities   119    5,014    2,932    21,085    44,209    110%   37050%
                                    
Loans (*)   17,641    17,780    17,858    17,669    17,257    -2%   -2%
Private sector loans   9,536    8,522    7,932    7,391    6,944    -6%   -27%
Mortgage loans (UVA adjusted)   8,105    9,258    9,923    10,275    10,309    0%   27%
Other loans   0    0    3    3    4    -    - 
Total CER adjustable assets   17,760    22,794    20,790    38,754    61,466    59%   246%
                                    
CER adjustable LIABILITIES                                   
Deposits (*)   272    503    662    2,409    955    -60%   251%
UVA Unemployment fund   497    681    702    651    694    7%   40%
Total CER adjustable liabilities   769    1,184    1,364    3,060    1,649    -46%   114%
NET CER EXPOSURE   16,991    21,610    19,426    35,694    59,817    68%   252%
                                    
(*) Includes Loans &Time Deposits CER adjustable (UVAs)                                   

 

FOREIGN CURRENCY POSITION  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)   3Q19   4Q19   1Q20   2Q20   3Q20   QoQ    YoY 
Cash and deposits in Banks   76,000    86,770    77,790    86,103    92,351    7%   22%
Cash   13,315    13,350    5,094    4,686    7,718    65%   -42%
Central Bank of Argentina   26,958    41,658    35,325    37,318    58,221    56%   116%
Other financial institutions local and abroad   35,722    31,757    37,367    44,095    26,407    -40%   -26%
Others   5    5    4    4    5    25%   0%
Net Income from financial instruments at fair value through P&L   323    302    159    36    4    -89%   -99%
Derivatives   0              0    0    -    - 
Other financial assets   5,145    4,602    4,612    4,417    4,569    3%   -11%
Loans and other financing   75,007    47,661    45,297    31,896    23,366    -27%   -69%
Other financial institutions   265    744    81    64    39    -39%   -85%
Non financial private sector & foreign residents   74,742    46,917    45,216    31,832    23,327    -27%   -69%
Other debt securities   2,032    1,058    4,216    4,609    4,529    -2%   123%
Guarantees received   2,341    3,537    2,371    2,306    1,576    -32%   -33%
Investment in equity instruments   12    13    6    7    7    0%   -42%
Investment in associates and joint ventures   0    1    0    0    0    -    - 
Total Assets   160,861    143,944    134,451    129,375    126,403    -2%   -21%
Deposits   109,785    97,442    88,372    82,785    78,758    -5%   -28%
Non financial public sector   3,725    4,880    3,544    3,636    2,536    -30%   -32%
Financial sector   300    281    279    290    393    36%   31%
Non financial private sector & foreign residents   105,760    92,281    84,549    78,859    75,829    -4%   -28%
Other liabilities from financial intermediation   6,759    6,418    6,586    5,866    5,688    -3%   -16%
Financing from the Central Bank and other fin. Inst   3,924    2,502    780    764    540    -29%   -86%
Subordinated corporate bonds   32,316    29,611    30,182    30,846    31,530    2%   -2%
Other non financial liabilities   82    30    36    64    56    -13%   -32%
Total Liabilities   152,866    136,003    125,956    120,325    116,572    -3%   -24%
NET FX POSITION (Pesos)   7,995    7,941    8,495    9,050    9,831    9%   23%
EOP FX (Pesos per USD)   57.5583    59.8950    64.4700    70.4550    76.1750    8%   32%
NET FX POSITION (USD)   139    133    132    128    129    0%   -7%

 

17 

 

 

    3Q20 Earnings Release

 

Relevant and Recent Events

 

·Interest Payment Class C Peso denominated Notes. In October 2020, the Bank paid quarterly interest on Class C Peso denominated notes in the amount of Ps.201,528,367.94.

 

·Interest Payment Class A Subordinated Notes. In November 2020, the Bank paid semiannual interest on Class A subordinated notes in the amount of USD 13,500,000.

 

·Interest Payment Class B Peso denominated Notes. In Novebmer 2020, the Bank paid semiannual interest on Class B Peso denominated notes in the amount of Ps.252,804,212.

 

·Special Shareholders Meeting- Complementary Dividend. The Special Shareholders’ Meeting held on October 21st, 2020 adopted the following resolutions: a) separate a portion of the optional reserve fund for future profit distributions equal to $3,791,721,509 to be applied to the payment of a cash dividend to supplement the Dividend (hereinafter referred to as the ”Supplementary Dividend”) pursuant to paragraph b) below; b) calculate the Supplementary Dividend by multiplying the dividend of $ 20 per share already approved by the General and Special Shareholders’ Meeting held on April 30th 2020, by the coefficient obtained after dividing the most recent Consumer Price Index (“CPI”) published by Instituto Nacional de Estadísticas y Censos (INDEC) and informed by such entity to the date on which Banco Central de la República Argentina issues its authorization for the payment of the Dividend and the Supplementary Dividend, by the CPI of the month of April 2020. The difference arising between the amount obtained after the above described calculation and the Dividend shall determine the amount of the Supplementary Dividend. The aggregate amount to be distributed as Supplementary Dividend may not exceed the amount of $3,791,721,509 separated from the optional reserve fund for future profit distributions. This amount will be deducted from Shareholders’ equity in 4Q20.

 

·Death of Mr. Jorge Horacio Brito- Chairman of the Board of Banco Macro. On November 23rd, 2020 Banco Macro informed the death of the Chairman of our Board, Mr. Jorge Horacio Brito. Pursuant to article 17 of the Bylaws, the office of the Chairman shall be covered by the Vice Chairman, Dr. Delfín J. Ezequiel Carballo. At the first Board meeting to be held, the appointment of a new Vice Chairman and the election, from among the Alternate Directors appointed by the General Shareholder Meeting, of the one who will assume in order to complete the number of regular directors will be discussed.

  

·Covid-19: In early March 2020, the World Health Organization recognized Coronavirus (Covid-19) as a pandemic that is severely affecting almost all countries around the world. The spread of this disease globally has forced the authorities to take drastic health and financial measures to contain and mitigate its effects on health and economic activity. Particularly in the Argentine Republic, on March 19, 2020, through Decree No. 297/2020, the Government established the “social, preventive and compulsory isolation” measure until March 31, 2020, which was then extended until June 7, 2020. Along with health protection rules, tax and financial measures were taken to mitigate the impact on the economy associated with the pandemic, including public direct financial assistance measures for part of the population, the establishment of financial and fiscal facilities for both individuals and companies. As regards measures related to the Entity’s business, the BCRA established maturities extensions, froze the mortgage loan installments and encouraged banks to lend to companies at reduced rates. In addition, the distribution of dividends of the finance institutions was suspended until June 30, 2020. In addition, in the mandatory quarantine context, the BCRA ruled that financial institutions would not be able to open their branches for public service during that period and should continue to provide services to users remotely. They could also trade with each other and their clients in the exchange market remotely. During quarantine, remote trading of stock exchanges and capital markets authorized by the CNV, the custodians and capital market agents registered with the CNV was admitted. In view of the extension of mandatory quarantine, the BCRA then decided that financial institutions would open their branches from Friday, April 3, 2020 for public attention through previous appointments obtained by the Bank’s website. The Bank is developing its activities under the conditions detailed above, giving priority to the compliance of social isolation measures by its employees, with the primary objective of taking care of the public health and well-being of all its stakeholders (employees, suppliers, customers, among others). To this end, it has put in place contingency procedures and has enabled its staff to carry out their tasks remotely. From a commercial point of view, it has emphasized maintaining a close relationship with its customers, trying to respond to their needs at this difficult time, sustaining all virtual channels of care to ensure operability and good response to requirements, monitoring compliance with their business obligations and monitoring the active portfolio in order to detect possible delays in collection and set new conditions for them. Considering the size of the abovementioned situation, the Bank’s Management estimates that this situation could have an impact on its operations and the financial situation and the results of the Bank, which are under analysis, and will ultimately, depend on the extent an duration of the health emergency and the success of the measures taken.

 

18 

 

 

    3Q20 Earnings Release

Regulatory Changes

 

·Net Foreign Currency Position. In September 2020, through Communication “A” 7101 the Central Bank of Argentina established that that export pre-financings for which its foreign currency funding is matched by liabilities linked to the evolution of such currency (for the same amount), can be deducted from the calculation of the cash position within the Net foreign currency position USD-linked liabilities that exceed that position are not to be considered in such deduction.

 

·USD savings account opening. In September through Communication “A” 7105 the BCRA established that prior to the opening of a USD currency savings account; financial institutions must gather evidence that the client has an income or assets consistent with foreign currency savings, and should not be a beneficiary of any social plan or program.

 

·Foreign currency purchase restrictions. In September 2020 through Communication “A” 7106, the Central Bank of Argentina established debit and credit card consumption abroad with debit on local accounts in pesos, and foreign currency purchased by individuals for the payment of obligations between residents, including payments of foreign currency consumptions through credit cards, will be deducted as of the following month, from the USD 200 cap. Those who are beneficiaries of credit relief programs related to the pandemic will not be able, until the total cancellation of credits or while the relief stands, to have access to the foreign exchange market or sell securities that settle in foreign currency, or transfer them to custodians abroad. For those with capital amortizations due between October 15, 2020 and March 31, 2021, related to financial debts abroad or public securities denominated in foreign currency, must present to the BCRA refinancing plan.

 

·COVID-19. In September 2020 through Communication “A” 7107 the BCRA extended until December 31, 2020, the regulation stating that financial institutions cannot charge fees for transactions done through ATMs (previously until June 30 and extended until September 30). It also extended the regulation that financial institutions cannot charge punitive interest over unpaid credits, and ratifies unpaid instalments deferral to maturity, considering accrual of a compensatory interest rate.

 

·LELIQ position. As of October 2, 2020 through Communication “A” 7122 the Central Bank of Argentina established that financial institutions must reduce in 20 percentage points their net excess position in LELIQ versus their monthly average of daily balances recorded in September 2020. To comply, they shall reduce the excess net position through the gradual maturity of the securities. Along this regulation but in line with it, the BCRA decided to increase the REPO rate from 19% t0 24%.

 

·Rates (Leliqs and Repo). The BCRA decided to increase to 27% the passive REPO BCRA rate (from 24% and previously 19%) and increase the LELIQ rate to 37%. It also determined that companies can access the foreign exchange market 30 days prior to financial debt maturities to cancel capital and interest payments. Corporates can also have access when the pre-cancellation is done within the frame of a securities exchange restructuring process.

 

·Time deposits minimum rate. In October 2020 through Communication “A” 7131 the Central Bank established that as of October 13, 2020, the minimum interest rates are for time deposits of up to Ps.1 million to 89.35% (previously 87%). Additionally, as of the same date, the coefficient that determines the fixed rate of pre-cancellation of UVA-linked time deposits (with early termination option) was increased to 0.7703.

 

·Minimum cash requirements. In October 2020 through Communication “A” 7132 the Central Bank of Argentina decided that for financings that are disbursed as of October 9, 2020, financial institutions will not be able to deduct from cash requirements financings granted to individuals or companies that (i) belong to activity sectors that are not eligible for the “Programa de Asistencia de Emergencia al Trabajo y la Producción” (ATP) social program benefits and/or (ii) have imported consumer goods after March 19, 2020, unless these were medical products and/or supplies.

 

19 

 

 

  3Q20 Earnings Release

 

·Rates (Leliq and Repo). The BCRA decided to increase the one-day passive REPO nominal annual rate from 27% to 30%, implying an increment of three percentage points, and offer 7-day REPOs at a nominal annual rate of 33%. In line with this, the LELIQ rate was established at 36%.

 

·Time deposits minimum rate. (Communication “A” 7139. 10/15/2020). The BCRA decided to increase, for time deposits granted as of October 16, 2020, the percentages applicable to the average rates of LELIQ used to set the minimum rates for time deposits of less than $1 million to 91.89% (previously 89.35%). For time deposits granted as of October 21, 2020, the increment goes up to 94.44% and the coefficient that determines the fixed rate of pre-cancellation of UVA-linked time deposits (with early termination option) was increased to 0.7917. This is equivalent to a 34% nominal annual rate for individuals with time deposits of less than $1 million and 32% for the rest.

 

·New credit lines. In October 2020 through Communication “A” 7140 the Central Bank of Argentina established that financial institutions shall grant, within the frame of the ATP social program created by the Decree N°332/2020- financing for a maximum limit equivalent to the amount resulting from the number of employees (F.931) multiplied by the minimum wage plus a 20%, to the SMEs in a list provided by the Federal Administration of Public Revenues (AFIP), and that will be able to rely on a warrant to be arranged by FOGAR, and as of November 1, 2020, can be deducted of reserve requirements (40%). Moreover, credit lines to SMEs are launched to (i) finance investment projects aimed for the purchase of capital assets and/or the construction of facilities necessary for the manufacturing of goods and/or services, at a 30% nominal annual rate; and (ii) for working capital and discounted instruments to SMEs at 35%. Financial institutions affected by this regulation must comprise under these financings, as of October 16, 2020 and until March 31, 2021, the equivalent to 7.5% of their non-financial private sector deposits in pesos (as a monthly average of daily balances of September 2020). For the financing of investment projects, this limit must be 30% of the 7.5% previously stated.

 

·Branch Closures. In October 2020, through Communication “A” 7147 the Central Bank established that financial institutions must require prior approval by the BCRA to proceed to the transfer or closure of branches until March 31, 2020.

 

·REPO rate. In October through Communciation “C” 88436 the Central Bank of Argentina increased the 1-day REPO rate from 30% to 31% and the 7-day REPO rate from 33% to 34.5%.

 

·Fee increases. In November 2020, through Communication “A” 7158 the BCRA established that until February 28, 2020, financial institutions cannot communicate fee increases greater than 9% for January 2021, and 9% for February 2021 for fees on i) Savings accounts: additional debit card issuance; replacement of stolen or lost debit cards; ATM use (other than the Bank’s, the Bank network local or abroad) and cash withdrawal services at points of purchase. Ii) Credit cards: issuance services, renewal, maintenance; replacement or reprinting of stolen or lost cards and additional cards.

 

·Time deposits minimum rate. In November 2020, through Communication “A” 7160 the BCRA increased rates, for time deposits granted as of November 13, 2020, the percentages applicable to the average rates of LELIQ used to set the minimum rates for time deposits of less than $1 million to 102.78% (previously 94.44%). For the rest of time deposits this percentage will be 94.44% (prev. 88.89%). For time deposits granted as of November 18, 2020, for time deposits of less than $1 million, the applicable rate over LELIQ will be 97.37% (89.48% for the rest). The coefficient that determines the fixed rate of pre-cancellation of UVA-linked time deposits (with early termination option) granted as of November 13, 2020, was increased to0.8472 (from 0.7917). For the ones granted as of November 18, 2020, the coefficient will be 0.8026. Additionally, as of November 13, 2020, financial institutions that keep time deposits from the non-financial private sector in pesos below 10% of total deposits in pesos considering only capital balances without interests or adjustments will not be able to: (i) buy LELIQ for their excess position (ii) do 7-day REPOs with the BCRA.

 

·SMEs productive investment credit lines. Reserve requirements. (Communication “A” 7161.

 

·12/11/2020). The BCRA states that as of November 1, 2020, it grants a reduction in the average reserve requirements in pesos for an amount of 14% of financings considered in item 4.1. of “SMEs productive investment credit line” regulation, granted at a nominal annual rate of up to 30%. As of November 13, 2020, financings to SMEs that have imported consumer goods after March 19, 2020, can be considered within this credit line.

 

·Rates (Leliq and Repo). In November 2020, through Communication “C” 88548 the Central Bank of Argentina increased the one-day passive REPO rate from 31% to 32% and the 7-day rate from 34.5% to 36.5% Additional to this regulation, the BCRA decided to increase the LELIQ rate from 37% to 38%.

 

20 

 

 

  3Q20 Earnings Release

 

QUARTERLY BALANCE SHEET  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)  3Q19   4Q19   1Q20   2Q20   3Q20   QoQ   YoY 
ASSETS                                   
Cash and deposits in Banks   131,988    123,121    139,896    111,850    112,934    1%   -14%
Cash   21,146    23,861    21,052    17,097    20,151    18%   -5%
Central Bank of Argentina   75,097    67,452    81,472    50,563    66,367    31%   -12%
Other local& foreign entities   35,740    31,803    37,368    44,185    26,411    -40%   -26%
Other   5    5    4    5    5    0%   0%
Debt securities at fair value through profit& loss   2,044    6,940    1,926    13,475    16,547    23%   710%
Derivatives   77    62    47    18    14    -22%   -82%
Repo Transactions   -    1,330    465    74,007    53,971    -27%   - 
Other financial assets   7,590    7,538    13,833    12,071    15,568    29%   105%
Loans& other receivables   266,204    270,133    255,365    244,582    237,678    -3%   -11%
Non Financial Public Sector   646    7,888    4,769    6,984    4,009    -43%   521%
Financial Sector   3,331    4,833    3,149    2,353    1,786    -24%   -46%
Non Financial private sector and foreign   262,227    257,412    247,447    235,245    231,883    -1%   -12%
Other debt securities   104,640    78,948    110,358    160,578    240,248    50%   130%
Financial assets in guarantee   14,633    13,052    11,344    14,986    12,228    -18%   -16%
Investments in equity instruments   2,066    1,879    1,796    1,733    1,627    -6%   -21%
Investments in other companies
(subsidiaries and joint ventures)		   185    179    191    161    182    13%   -2%
Property, plant and equipment   31,356    31,486    31,265    30,970    30,900    0%   -1%
Intangible assets   4,447    4,332    4,478    4,439    4,432    0%   0%
Deferred income tax assets   44    53    65    70    71    1%   61%
Other non financial assets   2,146    1,327    1,659    2,094    2,076    -1%   -3%
Non-current assets held for sale   1,718    2,141    2,211    2,196    2,247    2%   31%
TOTAL ASSETS   569,138    542,521    574,899    673,230    730,723    9%   28%
LIABILITIES                                   
Deposits   354,120    321,455    353,159    437,096    492,710    13%   39%
Non Financial Public Sector   27,799    21,474    30,980    64,237    105,636    64%   280%
Financial Sector   400    384    330    376    441    17%   10%
Non Financial private sector and foreign   325,921    299,597    321,849    372,483    386,633    4%   19%
Derivatives   201    940    182    -    -    -    -100%
Repo Transactions   2,961    1,226    -    1,372    -    -100%   -100%
Other financial liabilities   22,832    27,111    26,641    30,996    28,635    -8%   25%
Financing received from Central Bank and Other Financial Institutions   4,570    2,746    981    1,151    688    -40%   -85%
Issued Corporate Bonds   8,208    6,757    6,197    5,220    5,019    -4%   -39%
Current income tax liabilities   6,159    9,950    11,674    8,062    9,961    24%   62%
Subordinated corporate bonds   32,415    29,730    30,182    30,846    31,530    2%   -3%
Provisions   1,834    1,802    1,801    1,738    1,626    -6%   -11%
Deferred income tax liabilities   2,022    199    4    3,946    2,535    -36%   25%
Other non financial liabilities   12,488    12,375    9,003    24,477    24,095    -2%   93%
TOTAL LIABILITIES   447,810    414,291    439,824    544,904    596,799    10%   33%
                                    
SHAREHOLDERS' EQUITY                                   
Capital Stock   639    639    639    639    639    0%   0%
Issued Shares premium   12,428    12,430    12,430    12,430    12,430    0%   0%
Adjustment to Shareholders' Equity   43,863    43,864    43,864    43,864    43,864    0%   0%
Reserves   67,168    67,168    67,168    102,297    102,297    0%   52%
Retained earnings   -19,814    -19,814    3,968    -45,454    -45,454    0%   129%
Other accumulated comprehensive income   217    160    -1,021    -361    -840    133%   - 
Net income for the period / fiscal year   16,825    23,782    8,025    14,910    20,986    41%   25%
Shareholders' Equity attributable to parent company   121,326    128,229    135,073    128,325    133,922    4%   10%
                                    
Shareholders' Equity attributable to non controlling interest   2    1    2    1    2    100%   0%
TOTAL SHAREHOLDERS' EQUITY   121,328    128,230    135,075    128,326    133,924    4%   10%

 

21 

 

 

  3Q20 Earnings Release

 

INCOME STATEMENT  MACRO Consolidated   Change 
In MILLION $ (Measuring Unit Current at EOP)  3Q19   4Q19   1Q20   2Q20   3Q20   QoQ   YoY 
Interest Income   51,124    41,891    35,064    31,871    36,790    15%   -28%
Interest Expense   22,393    12,933    10,900    10,295    15,631    52%   -30%
Net Interest Income   28,731    28,958    24,164    21,576    21,159    -2%   -26%
Fee income   5,947    5,791    5,522    5,398    5,738    6%   -4%
Fee expense   552    554    495    394    467    19%   -15%
Net Fee Income   5,395    5,237    5,027    5,004    5,271    5%   -2%
Subtotal (Net Interest Income + Net Fee Income)   34,126    34,195    29,191    26,580    26,430    -1%   -23%
Net Income from financial instruments at Fair Value Through Profit& Loss   -16,732    -315    -4,643    -2,163    -7,541    249%   -55%
Result from assets at amortised cost   -    66    967    20    61    205%   - 
Difference in quoted prices of gold
and foreign currency		   2,138    1,670    604    846    1,207    43%   -44%
Other operating income   1,510    1,147    1,247    1,145    1,182    3%   -22%
Provision for loan losses   393    1,776    977    2,523    1,749    -31%   345%
Net Operating Income   20,649    34,987    26,389    23,905    19,590    -18%   -5%
Personnel expenses   6,350    6,339    5,361    6,174    6,199    0%   -2%
Administrative expenses   4,153    4,190    3,034    3,126    3,400    9%   -18%
Depreciation and impairment of assets   956    950    948    992    1,015    2%   6%
Other operating expense   9,334    5,879    4,905    4,412    4,587    4%   -51%
Operating Income   -144    17,629    12,141    9,201    4,389    -52%   - 
Income from associates and joint ventures   24    32    23    9    15    67%   -38%
Result from net monetary position   8,185    -5,644    335    479    4,836    910%   -41%
Net Income before income tax on cont. operations   8,065    12,017    12,499    9,689    9,240    -5%   15%
Income tax on continuing operations   -1,047    5,061    4,474    2,804    3,164    13%   -402%
Net Income from continuing operations   9,112    6,956    8,025    6,885    6,076    -12%   -33%
                                    
Net Income for the period   9,112    6,956    8,025    6,885    6,076    -12%   -33%
Net Income of the period attributable
to parent company		   9,112    6,956    8,025    6,885    6,076    -12%   -33%
Net income of the period attributable
to non-controlling interests		   -    -    -    -    -    -    - 
                                    
Other Comprehensive Income   533    -57    -1,181    660    -478    -    - 
Foreign currency translation differences in
financial statements conversion		   492    -172    -8    84    51    -39%   -90%
Profits or losses from financial assets measured at fair value through other comprehensive income (FVOCI)(IFRS 9(4.1.2)(a)   41    -    -    -1,173    -529    -    - 
                                    
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD   9,645    6,899    6,844    7,545    5,598    10%   145%
Total Comprehensive Income attributable
to parent Company		   9,645    6,899    6,844    7,545    5,598    10%   145%
Total Comprehensive Income attributable
to non-controlling interests		   -    -    -    -    -    -    - 

 

22 

 

 

  3Q20 Earnings Release

 

QUARTERLY ANNUALIZED RATIOS  MACRO Consolidated 
   3Q19   4Q19   1Q20   2Q20   3Q20 
Profitability & performance                         
Net interest margin   24.7%   33.6%   25.2%   19.8%   17.1%
Net interest margin adjusted (exc. FX)   23.0%   31.7%   24.6%   19.1%   16.2%
Net fee income ratio   20.6%   8.8%   14.3%   14.7%   20.3%
Efficiency ratio   64.3%   34.5%   39.8%   43.3%   57.1%
Net fee income as % of A&G Expenses   32.1%   25.4%   36.0%   33.9%   35.6%
Return on average assets   6.3%   5.2%   5.9%   4.5%   3.5%
Return on average equity   38.0%   21.8%   24.6%   21.5%   18.4%
Liquidity                         
Loans as a percentage of total deposits   75.2%   84.0%   72.3%   56.0%   48.2%
Liquid assets as a percentage of total deposits   61.0%   59.0%   66.0%   54.0%   51.0%
Capital                         
Total equity as a percentage of total assets   21.3%   23.6%   23.5%   19.1%   18.3%
Regulatory capital as % of APR   26.5%   27.3%   32.0%   32.2%   34.8%
Asset Quality                         
Allowances over total loans   2.2%   2.4%   2.5%   3.1%   3.6%
Non-performing financing as a percentage of total financing   1.9%   2.1%   1.4%   1.5%   1.1%
Coverage ratio w/allowances   111.2%   106.1%   173.5%   210.7%   302.9%
Cost of Risk   0.6%   2.6%   1.6%   4.1%   3.0%

 

ACCUMULATED ANNUALIZED RATIOS  MACRO Consolidated 
   3Q19   4Q19   1Q20   2Q20   3Q20 
Profitability & performance                         
Net interest margin   21.5%   23.9%   25.2%   22.3%   20.3%
Net interest margin adjusted (exc. FX)   20.8%   23.0%   24.6%   21.6%   19.5%
Net fee income ratio   26.9%   20.1%   14.3%   14.5%   16.1%
Efficiency ratio   60.3%   50.7%   39.8%   41.6%   45.9%
Net fee income as % of A&G Expenses   44.6%   39.7%   36.0%   34.9%   35.1%
Return on average assets   3.6%   3.9%   5.9%   5.2%   4.6%
Return on average equity   18.4%   19.3%   24.6%   23.0%   21.5%
Liquidity                         
Loans as a percentage of total deposits   75.2%   84.0%   72.3%   56.0%   48.2%
Liquid assets as a percentage of total deposits   61.0%   59.0%   66.0%   54.0%   51.0%
Capital                         
Total equity as a percentage of total assets   21.3%   23.6%   23.5%   19.1%   18.3%
Regulatory capital as % of APR   26.5%   27.3%   32.0%   32.2%   34.8%
Asset Quality                         
Allowances over total loans   2.2%   2.4%   2.5%   3.1%   3.6%
Non-performing financing as a percentage of total financing   1.9%   2.1%   1.4%   1.5%   1.1%
Coverage ratio w/allowances   111.2%   106.1%   173.5%   210.7%   302.9%
Cost of Risk   1.5%   1.8%   1.6%   2.8%   2.9%

 

23 

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereto duly authorized.

 

Date: November 30, 2020

  MACRO BANK INC.
     
     
  By: /s/ Jorge Francisco Scarinci
  Name: Jorge Francisco Scarinci
  Title: Chief Financial Officer