[November 15, 2018] |
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Grupo Supervielle S.A. Reports 3Q18 Consolidated Results
Grupo Supervielle S.A. (NYSE:SUPV); (BYMA:SUPV), ("Supervielle"
or the "Company") a universal financial services group headquartered in
Argentina with a nationwide presence, today reported results for the
three and nine-month periods ended September 30, 2018. All figures
presented throughout this document are expressed in nominal Argentine
pesos (AR$) and all financial information has been prepared in
accordance with IFRS in compliance with the adoption ruled by the
Argentine Central Bank.
Third Quarter 2018 Highlights
-
Attributable Comprehensive Income of AR$874.5 million, up 55.9% YoY
and 84.0% QoQ. ROAE of 22.4% in 3Q18 higher than 20.7% in 3Q17 and
12.6% in 2Q18. ROAA of 2.7% in 3Q18, decreasing by 40 bps YoY and
increasing by 90 bps QoQ.
-
Attributable Net income of AR$867.4 million, up 56.0% YoY and 220.4%
QoQ. In 3Q18, AR$120 million additional voluntary loan loss provisions
were made to increase the Coverage Ratio to 94.0% from 89.9% in 2Q18.
-
Net Financial Income of AR$4,386.2 million up 55.1% YoY and 21.3% QoQ
reflecting increases in asset and deposit volumes, together with
increased interest rates, mitigating to some the extent the higher
cost of funding and increased levels of non-remunerated minimum
reserve requirements.
-
NIM of 20.9% in 3Q18, expanded by 130 bps YoY and 170 bps QoQ. NFM of
18.2% in 3Q18, contracted by 160 bps YoY and expanded by 80 bps QoQ.
NIM expansion combines an increase in AR$ Investment portfolio with
higher Central Bank notes rates, partially offset by a lower AR$ Loan
portfolio NIM. The latter decreased by 340 bps YoY and 100 bps QoQ,
down to 21.3% reflecting higher cost of funds while loans continued to
reprice on a lagged basis.
-
Efficiency ratio improved to 59.3% in 3Q18 from 63.5% in 3Q17, and
66.3% in 2Q18.
-
Loans to deposits ratio was 85.8% in 3Q18 compared to 112.7% in 3Q17,
and 100.2% in 2Q18, mostly due to the overall growth in deposits
especially in wholesale deposits which funded higher investments in
Central Bank securities 7 day high-margin Leliqs.
-
Deposits increased 106.0% YoY and 28.4% QoQ to AR$97.2 billion (FX
neutral 15.9%). AR$ deposits increased 88.0% YoY and 21.3% QoQ, while
foreign currency deposits (measured in U$S) increased 8.2% YoY and
2.9% QoQ.
-
Loans rose 56.9% YoY and 10.0% QoQ to AR$83.4 billion (FX neutral
0.3%). AR$ Loan portfolio up 32.8% YoY and 4.1% QoQ. Foreign currency
loans (measured in U$S) increased 15.4% YoY and decreased 10.6% QoQ,
while measured in local currency increased 172.6% YoY and 27.7% QoQ.
-
Total assets increased 79.2% YoY and 21.0% QoQ to AR$ 146.1 billion,
outpacing loan growth, mainly due to larger holdings in Central Bank
securities (Leliqs) coupled with higher levels of regulatory minimum
reserve requirements.
-
NPL increased by 60 bps YoY and 10 bps QoQ to 3.7% in 3Q18. NPL
creation decreased to AR$ 0.96 billion in 3Q18 from AR$ 1.0 billion in
2Q18, including a AR$ 187 million decrease in NPL creation in the
consumer finance business, partially offset by increases in retail and
corporate segments.
-
The Retail banking segment registered a 90-day delinquency ratio of
2.1% in 3Q18 (slightly deteriorating from a 2.0% in 2Q18), well below
its NPL ratio of 3.2% reflecting the 67.6% share of payroll and
pension clients. The difference between both ratios is due to Central
Bank regulations.
-
Cost of risk was 5.9% in 3Q18. Excluding the AR$ 120 million
additional voluntary loan loss provisions made to increase coverage,
cost of risk would have been 5.3%, 30 bps below 2Q18 cost of risk.
Coverage increased to 94.0% in 3Q18 from 85.2% in 3Q17 and 89.9% in
2Q18.
-
Proforma Consolidated Common Equity Tier 1 Ratio of 12.5% in 3Q18,
decreased by 60 bps QoQ from 13.1% in 2Q18, impacted by the AR$
devaluation at the end of September. AR$2.0 billion remained at the
holding level for future capital injections. Equity to Asset ratio of
11.1% in 3Q18 compared to 17.2% at September 2017 and 12.7% at June
2018.
Commenting on third quarter 2018 results, Jorge Ramirez, Grupo
Supervielle's CEO, noted: "We reported solid results even in the face
of the increasingly challenging macro environment. Net income for the
quarter more than tripled sequentially and increased over 50%
year-on-year.
While total assets expanded 21% sequentially, loan growth decelerated
in line with industry trends. We also further reduced our exposure to
the consumer finance segment in the quarter, which now represents less
than 10% of our total portfolio and is more aligned with current market
conditions. Mitigating the effects of current market dynamics of recent
steep interest rate increases and higher non-remunerated minimum reserve
requirements, we significantly expanded our AR$ denominated deposit base
in the quarter, up 21% sequentially. We did this particularly in Sight
Wholesale Deposits to fund investment in high-margin 7-day Central Bank
securities. This, along with the continued repricing of our loan book
mainly in the corporate portfolio, allowed us to achieve an 80 basis
points increase in net financial margin reaching 18.2% in the quarter.
We are also pleased to see that the initiatives implemented earlier
in the year are delivering good results. The NPL ratio remained
relatively stable sequentially despite a more difficult economic
backdrop and a slowdown in loan growth as we further tightened credit
scoring standards throughout the Company. While our consumer finance
business saw NPL creation decrease sharply in the quarter, a contraction
in loans to this customer base drove a 50 bps QoQ increase in this
segment's NPLs. Taking into account current market conditions, we
decided to step up coverage to 94%.
Furthermore, we reported sequential improvement of 700 basis points
in the efficiency ratio down to 59.3%. We accomplished this by
quickly streamlining the business and maintaining tight control on costs
even as we faced additional expenditures associated with the
reorganization of the consumer finance business.
We are closely monitoring credit quality as we continue to face a
difficult economic backdrop. We remain confident that perseverance in
correcting macroeconomic imbalances will bear fruit and are optimistic
about the long-term potential of the banking industry in Argentina, the
strength of our Company and our ability to adapt our business model to a
rapidly changing environment," concluded Mr. Ramirez.
Financial Highlights & Key Ratios
(In millions of Argentine Ps.)
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% Change
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INCOME STATEMENT
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3Q18
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2Q18
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1Q18
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4Q17
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3Q17
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QoQ
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YoY
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9M18
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9M17
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% Chg.
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Net Interest Income
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2,722.9
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2,898.2
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2,818.1
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2,562.0
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2,124.8
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-6.1%
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28.1%
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8,439.2
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6,001.5
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40.6%
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NIFFI & Exchange Rate Differences
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1,663.4
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716.8
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805.5
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798.1
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703.0
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132.1%
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136.6%
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3,185.6
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1,638.3
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94.4%
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Net Financial Income
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4,386.2
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3,615.0
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3,623.6
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3,360.1
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2,827.8
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21.3%
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55.1%
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11,624.8
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7,639.8
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52.2%
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Net Service Fee Income (excluding income from insurance activities)
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1,026.9
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1,004.9
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884.6
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846.5
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874.9
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2.2%
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17.4%
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4,551.9
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3,218.4
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41.4%
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Income from Insurance activities
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183.1
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145.3
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148.7
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148.3
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108.0
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26.0%
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69.5%
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477.1
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330.8
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44.3%
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Loan Loss Provisions
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-1,122.5
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-989.2
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-726.1
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-606.3
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-518.9
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13.5%
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116.3%
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-2,837.9
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-1,322.5
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114.6%
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Personnel & Administrative Expenses
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-3,045.2
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-2,760.9
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-2,446.5
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-2,604.5
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-2,121.4
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10.3%
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43.5%
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-8,252.6
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-6,116.7
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34.9%
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Profit before income tax
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1,027.6
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456.0
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1,020.4
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651.1
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737.4
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125.3%
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39.4%
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2,504.0
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1,860.3
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34.6%
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Attributable Net income
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867.4
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270.7
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722.6
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467.6
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556.2
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220.4%
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56.0%
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1,860.7
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1,352.2
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37.6%
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Attributable Comprehensive income
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874.5
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475.3
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744.8
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472.6
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560.9
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84.0%
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55.9%
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2,094.7
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1,405.8
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49.0%
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Earnings per Share (AR$)
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2.01
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0.59
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1.58
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1.02
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1.43
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Earnings per ADRs (AR$)
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10.03
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2.96
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7.91
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5.12
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7.17
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Average Outstanding Shares (in millions)
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456.7
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456.7
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456.7
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456.7
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387.3
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BALANCE SHEET
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sep 18
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jun 18
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mar 18
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dec 17
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sep 17
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QoQ
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YoY
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Total Assets
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146,122.7
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120,789.0
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96,569.6
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92,202.4
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81,557.9
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21.0%
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79.2%
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Average Assets1
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128,633.2
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104,287.2
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90,832.7
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85,498.9
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73,226.9
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23.3%
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75.7%
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Total Loans & Leasing
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83,378.1
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75,830.0
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66,479.5
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60,692.9
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53,154.2
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10.0%
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56.9%
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Total Deposits
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97,185.5
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75,672.7
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55,540.2
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56,408.7
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47,170.8
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28.4%
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106.0%
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Attributable Shareholders' Equity
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16,220.0
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15,345.4
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15,114.2
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14,369.6
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14,032.8
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5.7%
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15.6%
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Average Attributable Shareholders' Equity1
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15,638.9
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15,044.8
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14,490.1
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14,188.7
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10,824.9
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3.9%
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44.5%
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KEY INDICATORS
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3Q18
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2Q18
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1Q18
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4Q17
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3Q17
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9M18
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9M17
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Profitability & Efficiency
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ROAE
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22.4%
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12.6%
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20.6%
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13.3%
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20.7%
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18.4%
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22.3%
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ROAA
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2.7%
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1.8%
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3.3%
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2.2%
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3.1%
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2.6%
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2.8%
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Net Interest Margin
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20.9%
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19.2%
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19.6%
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20.0%
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19.6%
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19.9%
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20.2%
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Net Financial Margin
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18.2%
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17.4%
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19.9%
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20.0%
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19.8%
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18.1%
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20.7%
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Net Fee Income Ratio
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21.4%
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24.3%
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22.3%
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22.8%
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25.2%
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22.6%
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26.7%
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Cost / Assets
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9.7%
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10.9%
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11.1%
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12.6%
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12.0%
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10.4%
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12.7%
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Efficiency Ratio
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59.3%
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66.3%
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59.0%
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68.2%
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63.5%
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61.4%
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66.5%
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Liquidity & Capital
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Loans to Total Deposits3
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85.8%
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100.2%
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119.7%
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107.6%
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112.7%
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Liquidity Coverage Ratio (LCR)4
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132.1%
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139.0%
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116.9%
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113.9%
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122.6%
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Total Equity / Total Assets
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11.1%
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12.7%
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15.7%
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15.6%
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17.2%
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Proforma Consolidated Capital / Risk weighted assets 5
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13.8%
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14.5%
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17.0%
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19.6%
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20.7%
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Proforma Consolidated Tier1 Capital / Risk weighted assets 6
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12.5%
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13.1%
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15.8%
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18.4%
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19.5%
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Risk Weighted Assets / Total Assets
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70.5%
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78.8%
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88.1%
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80.1%
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85.2%
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Asset Quality
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NPL Ratio
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3.7%
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3.6%
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3.2%
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3.1%
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3.1%
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Allowances as a % of Total Loans
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3.5%
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3.3%
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2.8%
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2.6%
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2.5%
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Coverage Ratio
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94.0%
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89.9%
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89.7%
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88.0%
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85.2%
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Cost of Risk7
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5.9%
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5.6%
|
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4.7%
|
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4.4%
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4.5%
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5.4%
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4.3%
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MACROECONOMIC RATIOS
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Retail Price Index (%)8
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14.1%
|
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8.8%
|
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6.7%
|
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6.1%
|
|
5.1%
|
|
|
|
|
|
|
|
|
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UVA (var)
|
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10.0%
|
|
7.5%
|
|
6.9%
|
|
4.9%
|
|
4.3%
|
|
|
|
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|
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Pesos/US$ Exchange Rate
|
|
40.90
|
|
28.86
|
|
20.14
|
|
18.77
|
|
17.32
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Badlar Interest Rate (eop)
|
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43.3%
|
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32.7%
|
|
22.6%
|
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23.3%
|
|
21.8%
|
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|
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Badlar Interest Rate (avg)
|
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37.1%
|
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27.3%
|
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22.9%
|
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22.5%
|
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20.8%
|
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TM20 (eop)
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44.1%
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33.9%
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22.6%
|
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23.7%
|
|
22.8%
|
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TM20 (avg)
|
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38.7%
|
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28.6%
|
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23.4%
|
|
23.4%
|
|
21.6%
|
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OPERATING DATA
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Active Customers (in millions)
|
|
1.9
|
|
1.9
|
|
1.9
|
|
1.9
|
|
1.9
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|
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Access Points9
|
|
368
|
|
368
|
|
340
|
|
326
|
|
324
|
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|
|
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Employees10
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|
5,281
|
|
5,451
|
|
5,406
|
|
5,320
|
|
5,222
|
|
-3.1%
|
|
1.1%
|
|
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1. Average Assets and average Shareholder´s Equity calculated on a daily
basis
2. Total Portfolio: Loans and Leasing before Allowances. According to
IFRS, this line item includes Securitized Loan Portfolio and loans
transferred with recourse.
3. Loans/Total Deposits ratio was restated in previous quarters due to
the inclusion in the balance sheet of the securitized and transferred
loans.
4. This ratio includes the liquidity held at the holding company level.
5. Regulatory capital divided by risk weighted assets taking into
account operational and market risk. The regulatory capital ratio
applies only to the Bank and CCF on a consolidated basis and does not
include the liquidity held at the holding company level- The Proforma
consolidated capital ratio, includes the liquidity retained at Grupo
Supervielle level after the equity offering, which is available for
growth. As of September 30, 2018, the liquidity amounted to Ps. 2.0
billion. This ratio has not been restated for 2017 quarters.
6. Tier 1 capital divided by risk weighted assets taking into account
operational and market risk. The regulatory Tier 1 capital ratio applies
only to the Bank and CCF on a consolidated basis and does not include
the liquidity held at the holding company level. The. Proforma
Consolidated Tier 1 capital ratio includes the liquidity retained at
Grupo Supervielle level after the equity offering, which is available
for growth. As of September 30, 2018, the liquidity amounted to Ps.2.0
billion. This ratio has not been restated for 2017 quarters.
7. Cost of risk in 3Q18, excluding the AR$ 120 million additional
voluntary loan loss provisions made to increase coverage, was 5.3%.
8. Source (News - Alert): INDEC
9. The increase in the number of Access Points in 1Q18, reflects the
opening of 1 bank branches located in Neuquen and the presence in 13
Walmart Stores. The increase in the number of Access Points in 2Q18,
reflects the opening of 2 bank branches and 32 Mila branches.
10. The decrease in the number of employees in 3Q18 reflects the
reorganization process in the consumer finance business
View source version on businesswire.com: https://www.businesswire.com/news/home/20181115006082/en/
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