6-K 1 tv486446_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

 

February 19, 2018

 

 

 

Commission File Number: 001-32827

 

 

 

MACRO BANK INC.

(Translation of registrant’s name into English)

 

 

 

Sarmiento 447

Buenos Aires C1 1041

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

 

 

 

 

 

 

4Q17 Earnings Release

 

Banco Macro Announces Results for the Fourth Quarter of 2017

 

Buenos Aires, Argentina, February 19, 2018 – Banco Macro S.A. (NYSE: BMA; BCBA: BMA) (“Banco Macro” or “BMA” or the “Bank”) announced today its results for the fourth quarter ended December 31, 2017 (“4Q17”). All figures are in Argentine pesos (Ps.) and have been prepared in accordance with Argentine GAAP.

 

Summary

 

·  The Bank’s net income totaled Ps.3.01 billion in 4Q17. This result was 16% higher than the Ps.2.60 billion posted in the third quarter of 2017 (“3Q17”) and 78% higher than the result posted in the fourth quarter of 2016 (“4Q16”). In 4Q17, the accumulated annualized return on average equity (“ROAE”) and the accumulated annualized return on average assets (“ROAA”) were 28.6% and 5.2%, respectively. Net Income of Ps.9.39 billion in FY2017 was 44% higher than net income in FY2016.

 

·  In 4Q17, Banco Macro’s financing to the private sector grew 10% or Ps.11.7 billion quarter over quarter (“QoQ”) totaling Ps.129.1 billion and increased 49% or Ps. 42.2 billion year over year (“YoY”). In the quarter, growth was driven by commercial loans, among which Documents and Others stand out, which grew 20% and 10% QoQ, respectively. Meanwhile within consumer loans, mortgage loans, credit cards and personal loans rose 29% and 16% and 12% QoQ, respectively.

 

·  In 4Q17, the accumulated efficiency ratio reached 42.5%, lower than the 43.2% posted in 3Q17 and the 47.5% in 4Q16. Net fee income over administrative expenses was 56.8%, higher than the 53.8% registered in 4Q16.

 

·  In 4Q17, Banco Macro’s total deposits grew 6% QoQ, totaling Ps.144.2 billion and representing 80% of the Bank’s total liabilities. Private sector deposits grew 9% QoQ.

 

·  Banco Macro continued showing a strong solvency ratio, with excess capital of Ps.35.1 billion (28.1% regulatory capital ratio – Basel III). In addition, the Bank’s liquid assets remained at an adequate level, reaching 50.4% of its total deposits in 4Q17.

 

·  In 4Q17, the Bank’s non-performing to total financing ratio was 1.07% and the coverage ratio reached 183.14%.

 

4Q17 Earnings Release Conference Call
 
Wednesday, February 21, 2018
Time: 11:00 a.m. Eastern Time | 1:00 p.m. Buenos Aires Time		  

IR Contacts in Buenos Aires:

 

Jorge Scarinci

Chief Financial Officer

         

To participate, please dial:

Argentina Toll Free:

(0800) 444 2930

Participants Dial In (Toll Free):

+1 (844) 839 2185

Participants International Dial In:

+1 (412) 317 2506

 

Conference ID: Banco Macro

Webcast: click here

  

 

 

Webcast Replay: click here

 

Available from 02/21/2018 through 03/07/2018

 

  

Nicolás A. Torres
Investor Relations

 

Phone: (54 11) 5222 6682

E-mail: investorelations@macro.com.ar

 

Visit our website at: www.ri-macro.com.ar

 

With the presence of: Jorge Pablo Brito (Director), Gustavo Manriquez (CEO), Jorge Scarinci (CFO)

 

 

 

 

4Q17 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), the Bolsa de Comercio de Buenos Aires (www.bolsar.com) 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.

 

 2

 

 

4Q17 Earnings Release

 

Results

 

Earnings per outstanding share were Ps.4.50 in 4Q17, 16% higher than in 3Q17 and 55% higher than 4Q16. On a yearly basis a 78% increase in net income was experienced while the average number of shares outstanding grew 15%.

 

EARNINGS PER SHARE  MACRO Consolidated   Variation 
In MILLION $  4Q16   1Q17   2Q17   3Q17   4Q17   2016   2017   FY17/FY16 
                                 
Net income (M $)   1,695.3    1,764.0    2,015.3    2,597.8    3,011.7    6,540.8    9,388.8    44%
Average # of shares outstanding (M)   584.5    584.5    593.5    668.2    669.7    584.5    629.3    8%
Book value per avg. Outstanding share ($)   37.82    40.84    60.40    60.00    64.4    37.8    68.5    81%
Shares Outstanding (M)   584.5    584.5    658.5    669.7    669.7    584.5    669.7    15%
Earnings per avg.  outstanding share ($)   2.90    3.02    3.40    3.89    4.50    11.19    14.92    33%
                                         
Book value per avg. issued ADS (USD)   23.86    26.55    36.39    34.65    34.31    23.86    34.31    44%
Earnings per avg. outstanding ADS (USD)   1.83    1.96    2.05    2.24    2.40    7.06    8.65    22%

 

Banco Macro’s 4Q17 net income of Ps.3.01 billion was 16% or Ps.414 million higher than the previous quarter and 78% or Ps.1.3 billion higher YoY.

 

In FY2017 Banco Macro´s net income was Ps.9.39 billion, 44% higher than the Ps.6.54 billion posted in FY2016. This result represented a ROAE and ROAA of 28.6% and 5.2% respectively.

 

The operating result for 4Q17 was Ps.4.92 billion, increasing 13% or Ps.559 million QoQ and 89% or Ps.2.3 billion on a yearly basis. Had Income from government and private securities and income on guaranteed loans and in CER adjustments been excluded, operating result would have been 150% higher than the result posted in 4Q16

 

In FY2017, the operating result of Ps.15.80 billion was 59% higher than the FY2016 result.

 

It is important to emphasize that this result was obtained with a leverage of 5.2x assets to equity ratio.

 

INCOME STATEMENT  MACRO Consolidated   Variation 
In MILLION $  4Q16   1Q17   2Q17   3Q17   4Q17   2016   2017   FY17/FY16 
                                 
Net financial income   4,242.1    4,640.4    5,244.8    6,026.7    7,042.7    15,634.5    22,954.6    47%
Provision for loan losses   -354.0    -361.4    -469.0    -342.5    -422.3    -1,073.1    -1,595.2    49%
Net fee income   1,532.2    1,667.0    1,800.2    1,874.3    1,962.8    5,364.9    7,304.3    36%
    5,420.3    5,946.0    6,576.0    7,558.5    8,583.2    19,926.3    28,663.7    44%
Administrative expenses   -2,814.8    -2,963.5    -3,044.2    -3,195.0    -3,660.3    -9,970.7    -12,863.0    29%
Operating result   2,605.5    2,982.5    3,531.8    4,363.5    4,922.9    9,955.6    15,800.7    59%
Minority interest in subsidiaries   -16.7    -15.8    -19.1    -19.2    -30.7    -54.6    -84.8    55%
Net other income   -52.7    -0.8    -189.0    -92.1    -261.0    117.2    -542.9    -563%
Net income before income tax   2,536.1    2,965.9    3,323.7    4,252.2    4,631.2    10,018.2    15,173.0    51%
Income tax   -840.8    -1,201.9    -1,308.4    -1,654.4    -1,619.5    -3,477.4    -5,784.2    66%
NET INCOME   1,695.3    1,764.0    2,015.3    2,597.8    3,011.7    6,540.8    9,388.8    44%

 

The Bank’s 4Q17 financial income totaled Ps.11.0 billion, increasing 15% (Ps.1.4 billion) compared to 3Q17 and increasing 45% (Ps.3.4 billion) YoY.

 

In FY2017, financial income totaled Ps.36.5 billion, 26% higher than in FY2016.

 

 3

 

 

4Q17 Earnings Release

 

Interest on loans represented 73% of total financial income in 4Q17. Interest on loans was 13% or Ps.912 million higher than 3Q17’s level due to an 11% increase in the average volume of the loan portfolio and a 60bp increase in the average interest lending rates. On an annual basis, interest on loans grew 38% or Ps.2.2 billion.

 

In FY2017, interest on loans totaled Ps.27.5 billion, 27% higher than in FY2016; this was as a result of a 51% increase in average private sector loans and a 486bp decrease in lending interest rates.

 

In 4Q17, net income from government and private securities increased 35% or Ps.630 million QoQ, mainly due to higher LEBACs income and income from other government and private securities. On an annual basis, net income from government and private securities grew 52% or Ps.826 million.

 

In FY2017, net income from government and private securities totaled Ps.6.4 billion, and was 3% higher compared to FY2016.

 

In the quarter, an increase of 117% or Ps.66 million in income from Guaranteed Loans and in CER Adjustment was observed (mainly related to UVA mortgage loans). On an annual basis, income from Guaranteed Loans and in CER Adjustment increased 84% or Ps.56 million.

 

Income from differences in quoted prices of gold and foreign currency decreased 49% or Ps.299 million QoQ mainly due to an 85% decrease in foreign currency position in 4Q17. On an annual basis, an increase of Ps.229 million was experienced.

 

Also in the quarter, other financial income increased 179% or Ps.83 million compared to 3Q17 mainly due to higher rates on reverse repurchase agreements. On an annual basis, an increase of 244% or Ps.92 million was experienced.

 

FINANCIAL INCOME  MACRO Consolidated   Variation 
In MILLION  $  4Q16   1Q17   2Q17   3Q17   4Q17   2016   2017   FY17/FY16 
                                 
Interest on cash and due from banks   0.1    0.8    0.1    6.1    6.7    1.2    13.7    1042%
Interest on loans to the financial sector   88.0    101.2    98.9    125.5    177.5    248.1    503.1    103%
Interest on overdrafts   650.5    650.4    621.4    679.0    752.7    2,494.4    2,703.5    8%
Interest on documents   399.7    374.0    390.1    430.0    492.2    1,559.1    1,686.3    8%
Interest on mortgages loans   176.6    179.0    186.6    201.9    216.1    729.8    783.6    7%
Interest on pledges loans   86.3    97.7    111.2    126.8    140.0    360.7    475.7    32%
Interest on credit cards loans   1,041.1    1,071.8    1,085.9    1,064.3    1,212.3    3,950.9    4,434.3    12%
Interest on financial leases   20.6    20.1    22.2    28.6    32.2    89.9    103.1    15%
Interest on other loans   3,333.6    3,565.4    3,906.3    4,415.6    4,960.5    12,197.6    16,847.8    38%
Net Income from government & private securities (1)   1,583.0    868.9    1,360.7    1,778.7    2,409.1    6,222.8    6,417.4    3%
Interest on other receivables from financial interm.   1.6    0.9    4.0    2.3    1.1    6.2    8.3    34%
Income from Guaranteed Loans - Decree 1387/01   8.9    3.1    0.0    0.1    0.0    33.7    3.2    -91%
CER adjustment   57.7    28.6    32.2    56.3    122.4    255.9    239.5    -6%
CVS adjustment   0.2    0.1    0.1    0.2    0.2    0.8    0.6    -25%
Difference in quoted prices of gold and foreign currency   86.9    159.5    423.9    614.5    315.6    516.9    1,513.5    193%
Other   37.8    478.9    110.9    46.6    130.0    267.3    766.4    187%
Total financial income   7,572.6    7,600.4    8,354.5    9,576.5    10,968.6    28,935.3    36,500.0    26%
                                         
Income from Interest on loans   5,796.4    6,059.6    6,422.6    7,071.7    7,983.5    21,630.5    27,537.4    27%
                                         
(1) Net Income from government & private securities                                        
LEBACs   1,200.8    537.5    1,270.5    1603.6    1,984.2    4,046.0    5,395.7    33%
Other Govermnet & Private Securities   382.2    331.4    90.2    175.1    424.9    2,176.8    1,021.7     -53% 
Net Income from government & private securities   1,583.0    868.9    1,360.7    1,778.7    2,409.1    6,222.8    6,417.4    3%

 

The Bank’s 4Q17 financial expense totaled Ps.3.9 billion, increasing 11% (Ps.376 million) compared to the previous quarter and 18% (Ps.595 million) compared to 4Q16.

 

In FY2017, financial expense totaled Ps.13.5 billion, 2% higher than in FY2016.

 

In 4Q17, interest on deposits represented 68% of the Bank’s total financial expense, increasing 11% or Ps.266 million QoQ. This increase was mainly driven by a 6% increase of the average volume of time deposits and an 80bp increase in the average time deposit interest rate. On a yearly basis, interest on deposits grew 7% or Ps.175 million.

 

 4

 

 

4Q17 Earnings Release

 

In FY2017, interest on deposits totaled Ps.9.3 billion, 10% lower than in FY2016, as a consequence of a 554bp decrease in time deposit interest rates and a 21% increase in the average volume of time deposits.

 

Other financial expense grew 12% or Ps.94million QoQ mainly due to higher provincial taxes and increased 32% or Ps.207 million YoY.

 

FINANCIAL EXPENSE  MACRO Consolidated   Variation 
In MILLION $  4Q16   1Q17   2Q17   3Q17   4Q17   2016   2017   FY17/FY16 
                                 
Interest on checking accounts   0.0    0.0    0.0    0.0    0.0    0.0    0.0    0%
Interest on saving accounts   23.5    24.0    26.1    30.7    29.4    89.9    110.2    23%
Interest on time deposits   2,452.8    2,109.8    2,117.0    2,354.2    2,621.8    10,283.7    9,202.8    -11%
Interest on interfinancing received loans   1.2    1.4    2.1    10.1    4.6    3.0    18.2    507%
Interest on other financing from the finan. institu.   -0.5    0.0    0.5    5.0    4.3    0.0    9.8    100%
Interest on subordinated bonds   117.2    105.2    106.9    117.8    122.6    277.2    452.5    63%
Other Interest   0.8    0.7    0.7    0.8    1.0    4.2    3.2    -24%
Interest on other liabilities from fin intermediation   38.9    16.2    122.3    210.8    214.3    145.8    563.6    287%
CER adjustment   2.9    2.8    5.1    4.2    12.5    12.1    24.6    103%
Contribution to Deposit Guarantee Fund   44.5    49.4    50.5    54.2    59.4    215.0    213.5    -1%
Other   649.2    650.5    678.5    762.0    856.0    2,269.9    2,947.0    30%
Total financial expense   3,330.5    2,960.0    3,109.7    3,549.8    3,925.9    13,300.8    13,545.4    2%
                                         
Financial Expenses from interest on deposits   2,476.3    2,133.8    2,143.1    2,384.9    2,651.2    10,373.6    9,313.0    -10%

 

As of 4Q17, the Bank’s accumulated net interest margin was 17.7%, higher than the 17.3% posted in 3Q17 and lower than the 18.2% posted in 4Q16. Had income from government and private securities and guaranteed loans including CER adjustments been excluded, the Bank’s accumulated net interest margin would have been 16.1% in 4Q17, slightly lower than the 16.2% posted in 3Q17 and higher than the 15.3% posted in 4Q16.

 

ASSETS & LIABILITIES PERFORMANCE  MACRO Consolidated 
In MILLON $  4Q16   1Q17   2Q17   3Q17   4Q17 
Yields & rates in annualized nominal %  AVERAGE
BALANCE		   INT   AVERAGE
BALANCE		   INT   AVERAGE
BALANCE		   INT   AVERAGE
BALANCE		   INT   AVERAGE
BALANCE		   INT 
                                         
Interest-earning assets                                        
Goverment Securities   25,904.9    23.2%   14,625.4    22.9%   24,753.8    21.7%   31,533.9    21.2%   31,490.5    26.5%
Loans   80,012.5    29.2%   89,747.5    27.6%   98,881.9    26.2%   112,017.0    25.2%   124,154.3    25.9%
Private Sector   78,975.2    29.1%   88,893.2    27.5%   98,275.7    26.2%   110,316.1    25.2%   122,336.1    25.8%
Public Sector   1,037.3    35.2%   854.3    32.8%   606.2    28.5%   1,700.9    28.3%   1,818.2    32.0%
Financial trusts   393.5    35.3%   739.1    25.9%   697.7    25.4%   765.3    26.0%   803.2    21.0%
Other interest-earning assets   2,586.2    11.4%   9,578.4    19.4%   3,296.4    11.1%   4,043.5    9.3%   5,196.4    30.7%
Total interest-earning assets   108,897.1    27.3%   114,690.4    26.3%   127,629.8    24.9%   148,359.7    24.0%   161,644.4    26.1%
                                                   
Non interest-earning assets   38,880.4         41,251.0         38,319.7         46,129.8         46,129.8      
Total Average Assets   147,777.5         155,941.4         165,949.5         194,489.5         210,280.6      
                                                   
Interest-bearing liabilities                                                  
Checking accounts (*)   1,727.6    0.0%   1,051.7    0.0%   1,639.3    0.0%   1,728.4    0.0%   1,213.6    0.0%
Saving accounts (*)   20,217.1    0.5%   24,245.1    0.4%   26,043.1    0.4%   30,764.4    0.4%   34,134.3    0.3%
Time deposits (*)   54,751.6    17.8%   54,146.9    15.8%   54,977.2    15.5%   61,526.7    15.2%   65,208.9    16.0%
Corporate Bonds   7,561.5    8.0%   6,932.6    6.8%   9,100.5    9.9%   11,641.8    10.9%   11,735.2    11.1%
BCRA   0.2    0.0%   0.2    0.0%   0.2    0.0%   0.1    0.0%   0.1    0.0%
Other interest-bearing liabilities   543.3    15.2%   571.4    17.7%   560.9    13.8%   2,261.0    13.1%   1,724.5    11.2%
Total interest-bearing liabilities   84,801.3    12.4%   84,801.3    10.6%   92,321.2    10.4%   107,922.4    10.2%   114,016.6    10.6%
                                                   
Non interest-bearing liabilities                                                  
Demand deposits (*) (*)   30,224.8         33,339.6         33,383.3         32,794.1         37,444.6      
Other non interest-bearing libilities & equity   32,751.4         35,653.9         40,245.0         53,773.0         58,819.4      
Total non interest-bearing liab. & equity   62,976.2         68,993.5         73,628.3         86,567.1         96,264.0      
                                                   
Total Average Liabilities & Equity   147,777.5         155,941.4         165,949.5         194,489.5         210,280.6      
                                                   
Assets Performance        7,485.0         7,439.8         7,931.7         8,958.7         10,649.7 
Liabilities Performance        2,652.4         2,278.3         2,390.8         2,782.4         3,036.2 
Net Interest Income        4,832.6         5,161.5         5,540.9         6,176.3         7,613.5 
Total interest-earning assets        108,897.1         114,690.4         127,629.8         148,359.7         161,644.4 
Net Interest Margin (NIM)        17.7%        18.3%        17.4%        16.5%        18.7%

 

(*) The average cost of funds is calculated only considering deposits with and without interest-bearnig cost.

 

 5

 

 

4Q17 Earnings Release

 

In 4Q17, Banco Macro’s net fee income totaled Ps.2.0 billion, 5% or Ps.89 million higher than 3Q17, and 28% or Ps.431 million higher than 4Q16.

 

In the quarter, fee income increased 6% or Ps.175 million. Fees charged on debit and credit card and deposit accounts fees stand out, which increased 8% and 4% respectively. On a yearly basis, fee income increased 27% or Ps.615 million, having the same concepts stand out (25% increase each).

 

In the quarter, total fee expenses grew 10% or Ps.87 million, with higher charges paid to debit/credit card brands and higher other fee expenses (13% and 10% increase respectively). On a yearly basis, fee expenses increased 24% or Ps.184 million, with similar concepts standing out (33% and 52% respectively).

 

In FY2017, net fee income totaled, Ps.7.3 billion, 36% higher than in FY2016.

 

NET FEE INCOME  MACRO Consolidated   Variation 
In MILLION $  4Q16   1Q17   2Q17   3Q17   4Q17   2016   2017   FY17/FY16 
                                 
Fee charges on deposit accounts   1,296.1    1,377.5    1,467.0    1,563.2    1,623.7    4,597.2    5,946.2    29%
Debit and credit card fees   685.4    694.5    707.0    793.4    855.3    2,538.4    3,135.9    24%
Other fees related to foreign trade   33.4    33.0    36.3    44.5    47.0    134.8    160.8    19%
Credit-related fees   69.6    55.9    96.5    66.2    72.3    152.6    290.9    91%
Lease of safe-deposit boxes   35.1    37.4    42.7    44.5    49.0    119.9    173.6    45%
Other   188.3    203.0    226.0    235.3    275.2    425.8    939.0    121%
Total fee income   2,307.9    2,401.3    2,575.5    2,747.1    2,922.5    7,968.7    10,646.4    34%
                                         
Debit and Credit card expenses   380.8    364.7    402.7    447.3    505.8    1,295.4    1,720.5    33%
Turnover tax and municipal assessments   119.2    137.7    151.6    166.3    180.9    427.5    636.5    49%
Comission paid to lending agencies   47.3    34.7    44.5    59.2    52.4    255.8    190.8    -25%
Foreign trade comissions   5.0    4.2    4.2    5.5    6.2    12.3    20.1    63%
Others   223.4    193.0    172.3    194.5    214.4    612.8    774.2    26%
Total fee expense   775.7    734.3    775.3    872.8    959.7    2,603.8    3,342.1    28%
                                         
Net fee income   1,532.2    1,667.0    1,800.2    1,874.3    1,962.8    5,364.9    7,304.3    36%

 

In 4Q17 Banco Macro’s administrative expenses totaled Ps.3.7 billion, 15% or Ps.465 million higher than the previous quarter. Administrative expenses increased 30% or Ps.845 million YoY due to an increase in personnel expenses (mainly higher salaries and other concepts) and other operating expenses.

 

Personnel expenses grew 13% or Ps.245 million QoQ, basically due to the back pay originated on 2017 inflation being higher than the salary increase agreed with the Union at the beginning of the year. On yearly basis personnel expenses increased 27% or Ps.453 million.

 

In FY2017, administrative expenses totaled Ps.12.9 billion, 29% higher than in FY2016.

 

As of December 2017, the accumulated efficiency ratio reached 42.5%, compared to the 43.3% posted in 3Q17 and 47.5 posted in 4Q16. In FY2017 Administrative expenses grew 29%, in line with the Bank’s focus of improving efficiency, while net financial income and net fee income grew 44% as whole.

 

 6

 

 

4Q17 Earnings Release

 

ADMINISTRATIVE EXPENSES  MACRO Consolidated   Variation 
In MILLION $  4Q16   1Q17   2Q17   3Q17   4Q17   2016   2017   FY17/FY16 
                                 
Personnel expenses   1,684.0    1,844.9    1,832.9    1,891.8    2,136.8    6,039.0    7,706.4    28%
Directors & statutory auditors´fees   82.5    86.7    98.6    121.5    138.3    314.5    445.1    42%
Other professional fees   85.7    78.0    87.0    94.9    107.5    283.2    367.4    30%
Advertising & publicity   75.0    43.5    38.3    56.0    95.1    197.5    232.9    18%
Taxes   149.9    162.5    178.4    180.6    207.1    534.4    728.6    36%
Depreciation of equipment   56.6    59.0    60.2    63.5    66.8    205.1    249.5    22%
Amortization of organization costs   54.0    60.1    64.1    71.4    79.4    197.1    275.0    40%
Other operating expenses   386.4    399.5    417.3    458.5    530.2    1,399.9    1,805.5    29%
Other   240.7    229.3    267.4    256.8    299.1    800.0    1,052.6    32%
Total Administrative Expenses   2,814.8    2,963.5    3,044.2    3,195.0    3,660.3    9,970.7    12,863.0    29%
                                         
Total Employees   8,617    8,675    8,702    8,721    8,774    8,617    8,774    2%
Branches   444    445    449    448    445    444    445    0%
Efficiency ratio   48.7%   47.0%   43.2%   40.4%   40.6%               
                                         
Accumulated efficiency ratio   47.5%   47.0%   45.0%   43.3%   42.5%   47.5%   42.5%     

 

In 4Q17, the Bank’s net other income/losses totaled a Ps.261 million loss. This loss was due to Other income totaling Ps.241 (12% or Ps. 26 million higher than in 3Q17)among which Others stand out (mostly income from Banco Macro’s stake in Prisma); and Other expense totaling Ps.502 million (63% higher than in 3Q17), among which Charges for other receivables uncollectibility and other allowances stand out.

 

In FY2017, net other income/losses totaled a Ps.543 million loss, compared to the Ps.117.2 million gain in FY2016.

 

NET OTHER INCOME/LOSSES  MACRO Consolidated   Variation 
In MILLION $  4Q16   1Q17   2Q17   3Q17   4Q17   2016   2017   FY17/FY16 
                                 
Other Income                                        
Penalty interest   19.5    17.0    19.3    26.4    21.8    83.1    84.5    2%
Recovered loans and  reversed allowances   85.5    88.2    139.3    65.9    53.9    229.6    347.3    51%
Other   49.3    39.3    145.5    123.5    165.7    285.8    474.0    66%
Total Other Income   154.3    144.5    304.1    215.8    241.4    598.5    905.8    51%
                                         
Other Expense                                        
Charges for other receivables uncollectibility and other allowances   79.7    69.6    134.8    171.4    343.2    203.3    719.2    254%
Goodwill amortization   1.4    1.4    1.4    1.4    16.4    10.1    20.6    104%
Other Expense   125.9    74.3    356.9    135.1    142.8    267.9    709.1    165%
Total Other Expense   207.0    145.3    493.1    307.9    502.4    481.3    1,448.9    201%
                                         
Net Other Income/Losses   -52.7    -0.8    -189.0    -92.1    -261.0    117.2    -543.1    -563%

 

In FY2017, Banco Macro's effective income tax rate was 38.1%, compared to 34.7% in FY2016.

 

Financial Assets

 

Private sector financing

 

The volume of “core” financing to the private sector (including loans, financial trust and leasing portfolio) totaled Ps.129.1 billion, increasing 10% or Ps.11.7 billion QoQ and 49% or Ps.42.2 billion YoY.

 

Within commercial loans, growth was driven by documents and others, which grew 20% and 10% QoQ, respectively.

 

 7

 

 

4Q17 Earnings Release

 

The growth in consumer loans was mainly driven by mortgage loans, credit card loans, and personal loans which grew 29%, 16% and 12% QoQ, respectively.

 

As of 4Q17, Banco Macro´s market share over private sector loans was 7.9%.

 

FINANCING TO THE PRIVATE SECTOR  MACRO Consolidated   Variation 
In MILLION $  4Q16   1Q17   2Q17   3Q17   4Q17   QoQ   YoY 
                             
Overdrafts   8,837.7    10,264.7    9,638.2    12,170.4    8,829.3    -27%   0%
Discounted documents   11,198.9    10,679.5    12,332.3    14,435.9    17,272.1    20%   54%
Mortgages loans   4,158.6    4,498.2    5,195.5    6,247.0    8,057.5    29%   94%
Pledges loans   2,285.1    2,471.5    3,263.4    3,551.3    4,150.1    17%   82%
Personal loans   29,784.8    33,365.0    37,342.5    42,361.4    47,376.8    12%   59%
Credit Card loans   18,851.6    19,526.1    20,590.9    21,507.2    24,971.9    16%   32%
Others   10,465.8    11,739.1    15,281.5    15,356.2    16,884.7    10%   61%
Total loan portfolio   85,582.5    92,544.1    103,644.3    115,629.4    127,542.4    10%   49%
                                    
Financial trusts   954.7    1,028.8    1,121.5    1,281.8    1,011.8    -21%   6%
Leasing   369.1    376.9    478.9    524.6    585.0    12%   58%
Total financing to the private sector   86,906.3    93,949.8    105,244.7    117,435.8    129,139.2    10%   49%
                                    
Market share over loan portfolio   8.1%   8.3%   8.3%   8.2%   7.9%          

 

Public Sector Assets

 

In 4Q17, the Bank’s public sector assets (excluding LEBACs) to total assets ratio was 1.5%, lower than the 2.5% posted in 3Q17 and the 3.7% posted in 4Q16.

 

In 4Q17, a 55% or Ps.1.7 billion decrease in other government securities position (peso denominated securities) stands out.

 

PUBLIC SECTOR ASSETS  MACRO Consolidated   Variation 
In MILLION $  4Q16   1Q17   2Q17   3Q17   4Q17   QoQ   YoY 
                             
LEBACs   15,964.3    11,406.9    24,544.4    26,454.1    35,641.8    35%   123%
Other   4,205.4    2,411.3    2,975.4    3,171.2    1,440.8    -55%   -66%
Government securities   20,169.7    13,818.2    27,519.8    29,625.3    37,082.6    25%   84%
Guaranteed loans   717.6    0.0    0.0    0.0    0.0    0%   0%
Provincial loans   814.9    480.0    497.3    1,834.3    1,797.3    -2%   121%
Loans   1,532.5    480.0    497.3    1,834.3    1,797.3    -2%   17%
Purchase of government bonds   37.0    36.1    38.3    39.5    42.1    7%   14%
Other receivables   37.0    36.1    38.3    39.5    42.1    7%   14%
                                    
TOTAL PUBLIC SECTOR ASSETS   21,739.2    14,334.3    28,055.4    31,499.1    38,922.0    24%   79%
                                    
TOTAL PUBLIC SECTOR LIABILITIES   23.6    19.5    15.2    10.2    4.8    -53%   -80%
                                    
Net exposure   21,715.6    14,314.8    28,040.2    31,488.9    38,917.2    24%   79%
                                    
TOTAL PUBLIC SECTOR ASSETS (net of LEBAC / NOBAC )   5,774.9    2,927.4    3,511.0    5,045.0    3,280.2    -35%   -43%
                                    
TOTAL PUBLIC SECTOR ASSETS (net of LEBAC / NOBAC) /TOTAL ASSETS   3.7%   1.9%   1.9%   2.5%   1.5%          

 

 8

 

 

4Q17 Earnings Release

 

Funding

 

Deposits

 

Banco Macro’s deposit base totaled Ps.144.2 billion in 4Q17, growing 6% or Ps.7.6 billion QoQ and 29% or Ps.32.3 billion YoY and representing 80% of the Bank’s total liabilities.

 

On a quarterly basis, private sector deposits increased 9% or Ps.11.2 billion while public sector deposits decreased 22% or Ps.3.6 billion. Within private sector deposits, sight deposits grew 17% or Ps.9.3 billion, and time deposits grew 4% or Ps.2.5 billion QoQ. Also in the quarter peso deposits increased 11% or Ps.10.0 billion while foreign currency deposits decreased 4% or USD 55 million.

 

As of 4Q17, Banco Macro´s market share over private sector deposits was 6.7%.

 

DEPOSITS  MACRO Consolidated   Variation 
In MILLION $  4Q16   1Q17   2Q17   3Q17   4Q17   QoQ   YoY 
                             
Public sector   9,552.2    13,007.6    10,804.0    16,461.9    12,890.7    -22%   35%
                                    
Financial sector   55.8    50.9    57.4    54.6    81.3    49%   46%
                                    
Private sector   102,331.7    102,124.4    112,796.0    120,096.3    131,253.9    9%   28%
Checking accounts   17,686.2    18,559.7    19,951.1    20,950.4    20,778.6    -1%   17%
Savings accounts   27,896.0    27,117.5    34,087.9    35,046.4    44,531.9    27%   60%
Time deposits   47,652.4    47,495.8    53,428.8    59,247.0    61,702.3    4%   29%
Other   9,097.1    8,951.4    5,328.2    4,852.5    4,241.1    -13%   -53%
Total   111,939.7    115,182.9    123,657.4    136,612.8    144,225.9    6%   29%
                                    
Pesos   88,640.4    93,023.1    100,308.9    106,746.2    113,075.4    6%   28%
Foreign Currency   23,299.3    22,159.8    23,348.5    29,866.6    31,150.5    4%   34%
                                    
Market share over private deposits   6.8%   6.7%   6.9%   7.1%   6.7%          

 

Other sources of funds

 

In 4Q17, the total amount of other sources of funds increased 7% or Ps.3.5 billion compared to 3Q17. In 4Q17 shareholder’s equity increased 8% or Ps.3.0 billion which was mainly driven by 4Q17 positive results.

 

OTHER SOURCES OF FUNDS  MACRO Consolidated   Variation 
In MILLION $  4Q16   1Q17   2Q17   3Q17   4Q17   QoQ   YoY 
                             
Central Bank of Argentina   8.4    8.4    10.4    9.8    11.5    17%   37%
Banks and international institutions   129.9    133.0    347.1    427.1    169.7    -60%   31%
Financing received from Argentine financial institutions   142.7    49.3    78.8    607.5    846.5    39%   493%
Subordinated corporate bonds   6,407.8    6,322.3    6,709.1    7,117.0    7,589.9    7%   18%
Non-subordinated corporate bonds   1,684.9    0.0    4,620.6    4,620.6    4,620.6    0%   174%
Shareholders´ equity   22,105.9    23,869.9    35,827.5    40,118.9    43,130.5    8%   95%
Total other source of funds   30,479.6    30,382.9    47,593.5    52,900.9    56,368.7    7%   85%

 

In 4Q17, Banco Macro’s average cost of funds reached 7.4%. This was mainly due to the decrease in the liabilities interest rate, and to Banco Macro’s transactional deposits, which represent approximately 52% of its total deposit base as of 4Q17. These accounts are low cost and are not sensitive to interest rate increases.

 

 9

 

 

4Q17 Earnings Release

 

Liquid Assets

 

In 4Q17, the Bank’s liquid assets amounted to Ps.72.7 billion, showing a 5% or Ps.3.4 billion increase QoQ and a 36% or Ps.19.4 billion increase on a yearly basis.

 

In 4Q17, Banco Macro’s LEBAC own portfolio and Reverse Repos from LEBAC increased 25% and 80% respectively; this increase in the LEBAC position was partially offset by a 9% decrease in Cash.

 

In 4Q17 Banco Macro’s liquid assets to total deposits ratio reached 50.4%.

 

LIQUID ASSETS  MACRO Consolidated   Variation 
In MILLION  $  4Q16   1Q17   2Q17   3Q17   4Q17   QoQ   YoY 
                             
Cash   36,089.2    29,014.7    36,477.2    37,705.2    34,267.6    -9%   -5%
Guarantees for compensating chambers   2,094.0    2,101.6    2,174.3    3,739.6    4,005.7    7%   91%
Call   5.0    115.0    235.0    410.0    146.0    -64%   2820%
Reverse repos from other securities   -    0.8    38.6    413.0    10.9    -97%   0%
Reverse repos from LEBAC/NOBAC   19.4    8,609.4    2,242.7    877.0    1,580.4    80%   8046%
LEBAC / NOBAC own portfolio   15,125.9    11,632.3    24,593.8    26,149.6    32,670.5    25%   116%
Total   53,333.5    51,473.8    65,761.6    69,294.4    72,681.1    5%   36%
                                    
Liquid assets to total deposits   47.6%   44.7%   53.2%   50.7%   50.4%          

 

Solvency

 

Banco Macro continued showing high solvency levels in 4Q17 with an integrated capital (RPC) of Ps.49.5 billion over a total capital requirement of Ps.14.4 billion. Banco Macro´s excess capital in 4Q17 was 243% or Ps.35.1 billion.

 

The regulatory capital ratio (as a percentage of risk-weighted assets- RWA) was 28.1% in 4Q17, TIER1 Ratio was 23.1%.

 

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

 

 10

 

 

4Q17 Earnings Release

 

MINIMUM CAPITAL REQUIREMENT  MACRO Consolidated   Variation 
In MILLION $  4Q16   1Q17   2Q17   3Q17   4Q17   QoQ   YoY 
                             
Credit risk requirement   7,634.6    7,945.2    9,410.4    10,942.8    11,023.2    1%   44%
Market risk requirement   267.2    115.6    863.4    711.8    184.4    -74%   -31%
Operational risk requirement   2,368.0    2,503.9    2,715.0    2,959.5    3,219.3    9%   36%
Total capital requirements   10,269.8    10,564.8    12,988.8    14,614.0    14,426.9    -1%   40%
                                    
Ordinary Capital Level 1 (COn1)   21,258.3    23,047.6    34,887.9    38,899.1    41,709.1    7%   96%
Deductible concepts Level 1 (COn1)   -684.3    -791.9    -819.5    -928.5    -1,022.0    10%   49%
Aditional Capital Level 1 (CAn1)   0.0    12.8    14.6    16.9    18.1    7%   0%
Capital Level 2 (COn2)   7,217.9    7,113.5    7,715.5    8,139.3    8,836.5    9%   22%
Integrated capital - RPC (i)   27,791.9    29,381.9    41,798.4    46,126.8    49,541.6    7%   78%
                                    
Excess capital   17,522.1    18,817.1    28,809.6    31,512.7    35,114.7    11%   100%
                                    
Risk-weighted assets - RWA (ii)   125,593.1    129,167.1    158,934.5    178,691.4    176,323.3    -1%   40%
                                    
Regulatory Capital ratio [(i)/(ii)]   22.1%   22.7%   26.3%   25.8%   28.1%          
                                    
Ratio TIER 1 [Capital Level 1/RWA]   16.4%   17.2%   21.4%   21.3%   23.1%          

 

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

 

Asset Quality

 

In 4Q17, Banco Macro’s non-performing to total financing ratio reached a level of 1.07%, higher than the 1% posted in 3Q17, and lower than the 1.14% posted in 4Q16.

 

Commercial portfolio non-performing loans slightly increased 12bp (Note that in 3Q17 a specific commercial client cancelled its debt driving Commercial portfolio non-performing loans lower), from 0.26% in 3Q17 to 0.38% in 4Q17; meanwhile consumer portfolio showed an improved performance with non-performing loans decreasing from 1.48% in 3Q17 to 1.45% in 4Q17.

 

The coverage ratio reached 183.14% in 4Q17.

 

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

 

ASSET QUALITY  MACRO Consolidated   Variation 
In MILLION $  4Q16   1Q17   2Q17   3Q17   4Q17   QoQ   YoY 
                             
Commercial portfolio   34,989.5    36,653.4    41,052.2    48,541.0    48,851.6    1%   40%
Non-performing   194.9    320.1    265.4    127.7    187.6    47%   -4%
Consumer portfolio   56,613.1    61,045.6    68,524.1    75,910.0    87,734.1    16%   55%
Non-performing   853.6    1,003.0    1,130.4    1,121.5    1,275.9    14%   49%
Total portfolio   91,602.6    97,699.0    109,576.3    124,451.0    136,585.7    10%   49%
Non-performing   1,048.5    1,323.1    1,395.8    1,249.2    1,463.5    17%   40%
Total non-performing/ Total portfolio   1.14%   1.35%   1.27%   1.00%   1.07%          
                                    
Total allowances   1,850.7    2,063.3    2,346.1    2,489.0    2,680.2    8%   45%
Coverage ratio w/allowances   176.51%   155.94%   168.08%   199.25%   183.14%          

 

 11

 

 

4Q17 Earnings Release

 

CER Exposure and Foreign Currency Position

 

CER EXPOSURE  MACRO Consolidated   Variation 
In MILLION $  4Q16   1Q17   2Q17   3Q17   4Q17   QoQ   YoY 
                             
CER adjustable ASSETS                                   
Guaranteed loans   717.5    -    -    -    -    0%   0%
Private sector loans (*)   98.8    288.7    756.9    1,752.8    3,582.2    104%   3526%
Other loans   0.2    0.2    1.7    4.7    10.5    123%   5150%
Total CER adjustable assets   816.5    288.9    758.6    1,757.5    3,592.7    104%   340%
                                    
CER adjustable LIABILITIES                                   
Deposits (*)   48.7    38.4    77.3    98.1    86.7    -12%   78%
Other liabilities from financial intermediation   23.4    19.3    15.1    10.0    4.4    -56%   -81%
Total CER adjustable liabilities   72.1    57.7    92.4    108.1    91.1    -16%   26%
                                    
NET CER EXPOSURE   816.5    231.2    666.2    1,649.4    3,501.6    112%   329%

 

(*) Includes Loans &Time Deposits CER adjustable (UVAs)

 

FOREIGN CURRENCY POSITION  MACRO Consolidated   Variation 
In MILLION $  4Q16   1Q17   2Q17   3Q17   4Q17   QoQ   YoY 
                             
Cash   21,394.9    16,141.8    21,575.2    25,191.5    19,735.3    -22%   -8%
Government and private securities   1,636.4    1,602.8    1,976.5    2,025.5    1,052.9    -48%   -36%
Loans   10,088.3    11,390.1    16,555.9    18,869.4    18,693.6    -1%   85%
Other receivables from financial intermediation   524.1    476.1    1,061.9    896.4    2,313.7    158%   341%
Other assets   346.1    429.9    534.0    568.0    714.6    26%   106%
Total Assets   33,989.8    30,040.7    41,703.5    47,550.8    42,510.1    -11%   25%
Deposits   23,299.4    22,159.9    23,348.6    29,866.5    31,150.6    4%   34%
Other liabilities from financial intermediation   1,142.5    1,205.3    2,360.3    3,501.1    2,653.5    -24%   132%
Non-subordinated corporate bonds   1,684.9    0.0    0.0    0.0    0.0    0%   0%
Subordinated corporate bonds   6,407.8    6,322.3    6,709.1    7,117.0    7,589.9    7%   18%
Other liabilities   1.8    2.2    5.9    6.6    49.8    655%   2667%
Total Liabilities   32,536.4    29,689.7    32,423.9    40,491.2    41,443.8    2%   27%
                                    
NET FX POSITION   1,453.4    351.0    9,279.6    7,059.6    1,066.3    -85%   -27%

 

 12

 

 

4Q17 Earnings Release

 

Relevant and Recent Events

 

·Credit Line for Productive Financing and Financial Inclusion 2017. As of December 31, 2017 the Bank successfully fulfilled the quota established under “Credit Line for Productive Financing and Financial Inclusion” for the second semester of 2017.

·Senior Management Changes. On November 8, 2017 Banco Macro’s Board of Directors appointed Gustavo Manriquez as Chief Executive Officer (previously General Manager) and Jorge Scarinci as Chief Financial Officer (previously Finance & Investor Relations Manager).

 

Regulatory Changes

 

·International Financial Reporting Standards (IFRS) As of December 31, 2017 according to IFRS the adjustment to Banco Macro’s equity would be Ps.3.4 billion totaling Ps.46.5 billion, 8% higher than the Ps.43.1 billion reported under BCRA’s rules.

 

 13

 

 

4Q17 Earnings Release

 

QUARTERLY BALANCE SHEET  MACRO Consolidated   Variation 
In MILLION $  4Q16   1Q17   2Q17   3Q17   4Q17   QoQ   YoY 
                             
ASSETS   154,999.0    166,992.3    187,767.9    206,345.1    224,242.7    9%   45%
Cash   36,089.2    29,014.7    36,477.2    37,705.2    34,267.6    -9%   -5%
Government and Private Securities   19,846.3    23,777.6    31,363.9    32,118.4    36,624.6    14%   85%
-LEBAC/NOBAC   15,145.3    20,241.7    26,836.5    27,026.6    34,250.9    27%   126%
-Other   4,701.0    3,535.9    4,527.4    5,091.8    2,373.7    -53%   -50%
Loans   87,973.0    94,083.3    105,369.4    119,762.1    132,000.2    10%   50%
to the non-financial government sector   1,532.5    480.0    497.3    1,834.3    1,797.3    -2%   17%
to the financial sector   1,730.6    1,890.1    2,251.8    3,027.3    3,271.8    8%   89%
to the non-financial private sector and foreign residents   86,540.4    93,757.3    104,970.2    117,364.3    129,585.6    10%   50%
-Overdrafts   8,837.7    10,264.7    9,638.2    12,170.4    8,829.3    -27%   0%
-Documents   11,198.9    10,679.5    12,332.3    14,435.9    17,272.1    20%   54%
-Mortgage loans   4,158.6    4,498.2    5,195.5    6,247.0    8,057.5    29%   94%
-Pledge loans   2,285.1    2,471.5    3,263.4    3,551.3    4,150.1    17%   82%
-Personal loans   29,784.8    33,365.0    37,342.5    42,361.4    47,376.8    12%   59%
-Credit cards   18,851.6    19,526.1    20,590.5    21,507.2    24,971.9    16%   32%
-Other   10,465.8    11,739.1    15,281.5    15,356.2    16,884.7    10%   61%
-Accrued interest, adjustments, price differences receivables and unearned discount   957.9    1,213.2    1,325.9    1,734.9    2,043.2    18%   113%
Allowances   -1,830.5    -2,044.1    -2,322.9    -2,463.8    -2,654.5    8%   45%
Other receivables from financial intermediation   5,313.6    13,716.9    7,784.2    9,166.5    13,000.7    42%   145%
Receivables from financial leases   370.2    378.1    479.8    526.3    587.5    12%   59%
Investments in other companies   11.4    9.3    32.6    91.4    128.8    41%   1030%
Other receivables   1,277.1    1,530.8    1,567.9    1,793.9    2,068.7    15%   62%
Other assets   4,118.2    4,481.6    4,665.9    5,181.3    5,564.6    7%   35%
LIABILITIES   132,893.1    143,122.4    151,940.4    166,226.2    181,112.2    9%   36%
Deposits   111,939.7    115,182.9    123,657.4    136,612.8    144,225.9    6%   29%
From the non-financial government sector   9,552.2    13,007.6    10,804.0    16,461.9    12,890.7    -22%   35%
From the financial sector   55.8    50.9    57.4    54.6    81.3    49%   46%
From the non-financial private sector and foreign residents   102,331.7    102,124.4    112,796.0    120,096.3    131,253.9    9%   28%
-Checking accounts   17,686.2    18,559.7    19,951.1    20,950.4    20,778.6    -1%   17%
-Savings accounts   27,896.0    27,117.5    34,087.9    35,046.4    44,531.9    27%   60%
-Time deposits   47,652.4    47,495.8    53,428.8    59,247.0    61,702.3    4%   29%
-Other   9,097.1    8,951.4    5,328.2    4,852.5    4,241.1    -13%   -53%
Other liabilities from financial intermediation   10,528.5    17,219.2    17,433.7    17,245.6    22,560.8    31%   114%
Subordinated corporate bonds   6,407.8    6,322.3    6,709.1    7,117.0    7,589.9    7%   18%
Other liabilities   4,017.1    4,398.0    4,140.2    5,250.8    6,735.6    28%   68%
SHAREHOLDERS' EQUITY   22,105.9    23,869.9    35,827.5    40,118.9    43,130.5    8%   95%
                                    
LIABILITIES + SHAREHOLDERS' EQUITY   154,999.0    166,992.3    187,767.9    206,345.1    224,242.7    9%   45%

 

 14

 

 

4Q17 Earnings Release

 

ANNUAL BALANCE SHEET  MACRO Consolidated   Variation 
In MILLION $  2015   2016   2017   FY17/FY16 
                 
ASSETS   104,952.0    154,999.0    224,242.7    45%
Cash   19,402.8    36,089.2    34,267.6    -5%
Government and Private Securities   15,391.4    19,846.3    36,624.6    85%
-LEBAC/NOBAC   8,303.0    15,145.3    34,250.9    126%
-Other   7,088.4    4,701.0    2,373.7    -50%
Loans   62,332.4    87,973.0    132,000.2    50%
to the non-financial government sector   748.1    1,532.5    1,797.3    17%
to the financial sector   227.4    1,730.6    3,271.8    89%
to the non-financial private sector and foreign residents   62,852.9    86,540.4    129,585.6    50%
-Overdrafts   4,707.9    8,837.7    8,829.3    0%
-Documents   6,550.2    11,198.9    17,272.1    54%
-Mortgage loans   3,508.5    4,158.6    8,057.5    94%
-Pledge loans   2,152.6    2,285.1    4,150.1    82%
-Personal loans   23,231.6    29,784.8    47,376.8    59%
-Credit cards   14,793.3    18,851.6    24,971.9    32%
-Other   7,078.5    10,465.8    16,884.7    61%
-Accrued interest, adjustments, price differences receivables and unearned discount   830.3    957.9    2,043.2    113%
Allowances   -1,496.0    -1,830.5    -2,654.5    45%
Other receivables from financial intermediation   3,295.3    5,313.6    13,000.7    145%
Receivables from financial leases   433.9    370.2    587.5    59%
Investments in other companies   10.9    11.4    128.8    1030%
Other receivables   978.9    1,277.1    2,068.7    62%
Other assets   3,106.4    4,118.2    5,564.6    35%
LIABILITIES   89,075.9    132,893.1    181,112.2    36%
Deposits   76,521.6    111,939.7    144,225.9    29%
From the non-financial government sector   9,588.4    9,552.2    12,890.7    35%
From the financial sector   40.1    55.8    81.3    46%
From the non-financial private sector and foreign residents   66,893.1    102,331.7    131,253.9    28%
-Checking accounts   14,062.9    17,686.2    20,778.6    17%
-Savings accounts   15,507.9    27,896.0    44,531.9    60%
-Time deposits   34,719.8    47,652.4    61,702.3    29%
-Other   2,602.5    9,097.1    4,241.1    -53%
Other liabilities from financial intermediation   7,537.4    10,528.5    22,560.8    114%
Subordinated corporate bonds   1,957.6    6,407.8    7,589.9    18%
Other liabilities   3,059.3    4,017.1    6,735.6    68%
SHAREHOLDERS' EQUITY   15,876.1    22,105.9    43,130.5    95%
                     
LIABILITIES + SHAREHOLDERS' EQUITY   104,952.0    154,999.0    224,242.7    45%

 

 15

 

 

4Q17 Earnings Release

 

QUARTERLY INCOME STATEMENT  MACRO Consolidated   Variation 
In MILLION  $  4Q16   1Q17   2Q17   3Q17   4Q17   QoQ   YoY 
                             
Financial income   7,572.6    7,600.4    8,354.5    9,576.5    10,968.6    15%   45%
Interest on cash and due from banks   0.1    0.8    0.1    6.1    6.7    10%   6600%
Interest on loans to the financial sector   88.0    101.2    98.9    125.5    177.5    41%   102%
Interest on overdrafts   650.5    650.4    621.4    679.0    752.7    11%   16%
Interest on documents   399.7    374.0    390.1    430.0    492.2    14%   23%
Interest on mortgage loans   176.6    179.0    186.6    201.9    216.1    7%   22%
Interest on pledge loans   86.3    97.7    111.2    126.8    140.0    10%   62%
Interest on credit card loans   1,041.1    1,071.8    1,085.9    1,064.3    1,212.3    14%   16%
Interest on financial leases   20.6    20.1    22.2    28.6    32.2    13%   56%
Interest on other loans   3,333.6    3,565.4    3,906.3    4,415.6    4,960.5    12%   49%
Income from government & private securities, net   1,583.0    868.9    1,360.7    1,778.7    2,409.1    35%   52%
Interest on other receivables from fin. intermediation   1.6    0.9    4.0    2.3    1.1    -52%   -31%
Income from Guaranteed Loans - Decree 1387/01   8.9    3.1    0.0    0.1    0.0    -100%   -100%
CER adjustment   57.7    28.6    32.2    56.3    122.4    117%   112%
CVS adjustment   0.2    0.1    0.1    0.2    0.2    0%   0%
Difference in quoted prices of gold and foreign currency   86.9    159.5    423.9    614.5    315.6    -49%   263%
Other   37.8    478.9    110.9    46.6    130.0    179%   244%
Financial expense   -3,330.5    -2,960.0    -3,109.7    -3,549.8    -3,925.9    11%   18%
Interest on checking accounts   0.0    0.0    0.0    0.0    0.0    0%   0%
Interest on saving accounts   -23.5    -24.0    -26.1    -30.7    -29.4    -4%   25%
Interest on time deposits   -2,452.8    -2,109.8    -2,117.0    -2,354.2    -2,621.8    11%   7%
Interest on interfinancing received loans   -1.2    -1.4    -2.1    -10.1    -4.6    -54%   283%
Interest on other financing from the financial institutions   0.5    0.0    -0.5    -5.0    -4.3    -14%   -960%
Interest on subordinated bonds   -117.2    -105.2    -106.9    -117.8    -122.6    4%   5%
Other Interest   -0.8    -0.7    -0.7    -0.8    -1.0    25%   25%
Interests on other liabilities from fin. intermediation   -38.9    -16.2    -122.3    -210.8    -214.3    2%   451%
CER adjustment   -2.9    -2.8    -5.1    -4.2    -12.5    198%   331%
Contribution to Deposit Guarantee Fund   -44.5    -49.4    -50.5    -54.2    -59.4    10%   33%
Other   -649.2    -650.5    -678.5    -762.0    -856.0    12%   32%
Net financial income   4,242.1    4,640.4    5,244.8    6,026.7    7,042.7    17%   66%
Provision for loan losses   -354.0    -361.4    -469.0    -342.5    -422.3    23%   19%
                                    
Fee income   2,307.9    2,401.3    2,575.5    2,747.1    2,922.5    6%   27%
Fee expense   -775.7    -734.3    -775.3    -872.8    -959.7    10%   24%
Net fee income   1,532.2    1,667.0    1,800.2    1,874.3    1,962.8    5%   28%
                                    
Administrative expenses   -2,814.8    -2,963.5    -3,044.2    -3,195.0    -3,660.3    15%   30%
Minority interest in subsidiaries   -16.7    -15.8    -19.1    -19.2    -30.7    60%   84%
Net other income   -52.7    -0.8    -189.0    -92.1    -261.0    183%   395%
Earnings before income tax   2,536.1    2,965.9    3,323.7    4,252.2    4,631.2    9%   83%
Income tax   -840.8    -1,201.9    -1,308.4    -1,654.4    -1,619.5    -2%   93%
                                    
Net income   1,695.3    1,764.0    2,015.3    2,597.8    3,011.7    16%   78%

 

 16

 

 

4Q17 Earnings Release

 

ANNUAL INCOME STATEMENT  MACRO Consolidated   Variation 
In MILLION  $  2015   2016   2017   FY17/FY16 
                 
Financial income   20,109.1    28,935.3    36,500.0    26%
Interest on cash and due from banks   0.2    1.2    13.7    1042%
Interest on loans to the financial sector   88.0    248.1    503.1    103%
Interest on overdrafts   1,407.0    2,494.4    2,703.5    8%
Interest on documents   1,146.2    1,559.1    1,686.3    8%
Interest on mortgage loans   556.6    729.8    783.6    7%
Interest on pledge loans   385.0    360.7    475.7    32%
Interest on credit card loans   2,646.1    3,950.9    4,434.3    12%
Interest on financial leases   81.7    89.9    103.1    15%
Interest on other loans   8,811.8    12,197.6    16,847.8    38%
Income from government & private securities, net   3,985.9    6,222.8    6,417.4    3%
Interest on other receivables from fin. intermediation   4.1    6.2    8.3    34%
Income from Guaranteed Loans - Decree 1387/01   25.1    33.7    3.2    -91%
CER adjustment   58.5    255.9    239.5    -6%
CVS adjustment   0.7    0.8    0.6    -25%
Difference in quoted prices of gold and foreign currency   653.1    516.9    1,513.5    193%
Other   259.1    267.3    766.4    187%
Financial expense   -8,842.7    -13,300.8    -13,545.4    2%
Interest on saving accounts   0.0    0.0    -110.2    0%
Interest on time deposits   -68.2    -89.9    -9,202.8    10137%
Interest on interfinancing received loans   -6,704.9    -10,283.7    -18.2    -100%
Interest on other financing from the financial institutions   -7.0    -3.0    -9.8    227%
Interest on subordinated bonds   -136.2    -277.2    -452.5    63%
Other Interest   -2.6    -4.2    -3.2    -24%
Interests on other liabilities from fin. intermediation   -96.0    -145.8    -563.6    287%
CER adjustment   -4.6    -12.1    -24.6    103%
Contribution to Deposit Guarantee Fund   -418.4    -215.0    -213.5    -1%
Other   -1,404.8    -2,269.9    -2,947.0    30%
Net financial income   11,266.4    15,634.5    22,954.6    47%
Provision for loan losses   -877.1    -1,073.1    -1,595.2    49%
                     
Fee income   6,115.4    7,968.7    10,646.4    34%
Fee expense   -1,714.8    -2,603.8    -3,342.1    28%
Net fee income   4,400.6    5,364.9    7,304.3    36%
                     
Administrative expenses   -7,225.9    -9,970.7    -12,863.0    29%
Minority interest in subsidiaries   -35.4    -54.6    -84.8    55%
Net other income   -33.0    117.2    -542.9    -563%
Earnings before income tax   7,495.6    10,018.2    15,173.0    51%
Income tax   -2,485.7    -3,477.4    -5,784.2    66%
                     
Net income   5,009.9    6,540.8    9,388.8    44%

 

 17

 

 

4Q17 Earnings Release

 

QUARTERLY ANNUALIZED RATIOS  MACRO Consolidated 
   4Q16   1Q17   2Q17   3Q17   4Q17 
Profitability & performance                         
Net interest margin (1)   17.7%   18.3%   17.4%   16.5%   18.7%
Net interest margin adjusted (2)   15.6%   17.5%   16.3%   15.1%   15.8%
Net fee income ratio   26.5%   26.4%   25.6%   23.7%   21.8%
Efficiency ratio   48.7%   47.0%   43.2%   40.4%   40.6%
Net fee income as a percentage of adm expenses   54.4%   56.2%   59.1%   58.7%   53.6%
Return on average assets   4.6%   4.6%   4.9%   5.3%   5.7%
Return on average equity   31.2%   30.5%   30.8%   26.3%   28.4%
Liquidity                         
Loans as a percentage of total deposits   80.2%   83.5%   87.1%   89.5%   93.4%
Liquid assets as a percentage of total deposits   47.6%   44.7%   53.2%   50.7%   50.4%
Capital                         
Total equity as a percentage of total assets   14.3%   14.3%   19.1%   19.4%   19.2%
Regulatory capital as % of APR   22.1%   22.7%   26.3%   25.8%   28.1%
Asset Quality                         
Allowances over total loans   2.0%   2.1%   2.2%   2.0%   2.0%
Non-performing financing as a percentage of total financing   1.1%   1.4%   1.3%   1.0%   1.1%
Coverage ratio w/allowances   176.5%   155.9%   168.1%   199.2%   183.1%

 

(1) Net interest margin excluding difference in quote in foreign currency

(2) Net interest margin (excluding difference in quote in foreign currency) except income from government & private securities and guaranteed loans

 

ACCUMULATED ANNUALIZED RATIOS  MACRO Consolidated 
   4Q16   1Q17   2Q17   3Q17   4Q17 
Profitability & performance                         
Net interest margin (1)   18.2%   18.3%   17.8%   17.3%   17.7%
Net interest margin adjusted (2)   15.3%   17.5%   16.9%   16.2%   16.1%
Net fee income ratio   25.5%   26.4%   26.0%   25.1%   24.1%
Efficiency ratio   47.5%   47.0%   45.0%   43.3%   42.5%
Net fee income as a percentage of adm expenses   53.8%   56.2%   57.7%   58.0%   56.8%
Return on average assets   5.2%   4.6%   4.7%   4.9%   5.2%
Return on average equity   34.1%   30.5%   30.7%   28.7%   28.6%
Liquidity                         
Loans as a percentage of total deposits   80.2%   83.5%   87.1%   89.5%   93.4%
Liquid assets as a percentage of total deposits   47.6%   44.7%   53.2%   50.7%   50.4%
Capital                         
Total equity as a percentage of total assets   14.3%   14.3%   19.1%   19.4%   19.2%
Regulatory capital as % of APR   22.1%   22.7%   26.3%   25.8%   28.1%
Asset Quality                         
Allowances over total loans   2.0%   2.1%   2.2%   2.0%   2.0%
Non-performing financing as a percentage of total financing   1.1%   1.4%   1.3%   1.0%   1.1%
Coverage ratio w/allowances   176.5%   155.9%   168.1%   199.2%   183.1%

 

(1) Net interest margin excluding difference in quote in foreign currency

(2) Net interest margin (excluding difference in quote in foreign currency) except income from government & private securities and guaranteed loans

 

 18

 

 

4Q17 Earnings Release

 

ACCUMULATED ANNUALIZED RATIOS  MACRO Consolidated 
   2015   2016   2017 
Profitability & performance               
Net interest margin (1)   17.9%   18.2%   17.7%
Net interest margin adjusted (2)   15.6%   15.3%   16.1%
Net fee income ratio   28.1%   25.5%   24.1%
Efficiency ratio   46.1%   47.5%   42.5%
Net fee income as a percentage of adm expenses   60.9%   53.8%   56.8%
Return on average assets   5.8%   5.2%   5.2%
Return on average equity   37.2%   34.1%   28.6%
Liquidity               
Loans as a percentage of total deposits   83.4%   80.2%   93.4%
Liquid assets as a percentage of total deposits   38.4%   47.6%   50.4%
Capital               
Total equity as a percentage of total assets   15.1%   14.3%   19.2%
Regulatory capital as % of APR   14.6%   22.1%   28.1%
Asset Quality               
Allowances over total loans   2.3%   2.0%   2.0%
Non-performing financing as a percentage of total financing   1.5%   1.1%   1.1%
Coverage ratio w/allowances   151.0%   176.5%   183.1%

 

(1) Net interest margin excluding difference in quote in foreign currency

(2) Net interest margin (excluding difference in quote in foreign currency) except income from government & private securities and guaranteed loans

 

 19

 

 

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: February 19, 2018

 

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