1Q25 Net Income at AR$7.9 billion with ROAE at 3.5%. Navigated a Transitional Macro Environment; Maintain Confidence in Our Core Strengths to Drive Growth
BUENOS AIRES, Argentina–(BUSINESS WIRE)–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-month period ended March 31, 2025.
Starting 1Q20, the Company began reporting results applying Hyperinflation Accounting, in accordance with IFRS rule IAS 29 (“IAS 29”) as established by the Central Bank.
Management Commentary
Commenting on first quarter 2025 results, Patricio Supervielle, Grupo Supervielle’s Chairman & CEO, noted: «We continued to make solid progress in advancing our long-term strategy across the organization. At Banco Supervielle, we are accelerating our transformation by scaling differentiated solutions that strengthen our position against both fintechs and traditional banks. At the core of our strategy are four key initiatives aimed at meeting and anticipating customer expectations:
- First, responding to the growing demand for simple, high-yield solutions, in April we launched our innovative Remunerated Account. Supervielle is the only bank in Argentina offering daily interest on both Payroll and SME accounts, in pesos and U.S. dollars. This innovation enhances the customer experience and reinforces our deposit base. We are confident it will also support organic client growth and deepen primary banking relationships.
- Second, as part of our client-centric innovation strategy, this month we launched Tienda Supervielle on Mercado Libre, Latin America’s leading e-commerce platform, becoming the first bank to have an official online store hosted on their marketplace and also fully accessible through the Supervielle mobile app. This initiative marks a key milestone in our Super App journey, expanding our digital ecosystem and redefining how customers interact with financial services by connecting everyday commerce and banking in a single, fully digital experience.
- Third, as part of our ongoing efforts to elevate the customer experience and improve efficiency, we are integrating Gen AI-powered interactions via WhatsApp, enhancing accessibility while also ensuring clients can always reach a human when needed, combining technology with the personalized service that defines Supervielle.
- And fourth, we continue to expand IOL, our leading online brokerage platform, which delivers integrated investment solutions to both its clients and the Bank’s customer base.
While Argentina faced temporary headwinds this quarter, we remain confident in the underlying strength and momentum of our business. After a strong start to the year, industry loan demand eased amid a mix of external factors, including tight peso liquidity, FX volatility, and heightened devaluation expectations ahead of the IMF agreement. We view these pressures as transitory and remain focused on capturing opportunities as macro conditions stabilize.
Client lending remained resilient, underscoring the strength of our core banking operations, while a sharp correction in treasury bond prices, amid uncertainty and prior to the confirmation of strong IMF support in April, negatively impacted investment portfolio performance. Our loan book increased 3% sequentially and 104% year-over-year in real terms, gaining 40 bps in market share over the past 12 months. Retail remained the main growth driver, now accounting for 52% of total loans, up from 48% in 4Q24 and 36% a year ago. Asset quality remains healthy. The NPL ratio rose to 2%, reflecting credit normalization following the rapid expansion in retail lending. Importantly, delinquency remains within expected levels embedded in pricing models, and we continue to refine origination and collection strategies to safeguard portfolio quality. On the funding side, deposits increased up 8% quarter-over-quarter, with market share rising 30 basis points to 3%. Together, these trends underscore the resilience of our business and provide a strong foundation for sustained, profitable growth.
Net fee income rose 32% year-on-year in real terms, supported by strong growth in banking fees, brokerage and asset management revenues, and deeper insurance penetration. In line with our efficiency strategy, operating expenses declined 12% sequentially and 17% year-over-year, reflecting continued progress on structural cost reduction and a leaner operating model.
Argentina is entering a new chapter. Recent measures, including the lifting of FX controls supported by the IMF and multilateral organizations, mark a shift toward greater openness and stability. This turning point is restoring confidence and creating conditions for long-term investment. At Supervielle, we are committed to supporting this transition by providing the credit and financial solutions our clients need to grow, staying close to those who produce, invest, and build. With a strong CET1 ratio of 15.3%, we are well-positioned to capture the opportunities ahead. I am proud of the digitally integrated, customer-centric platform we’ve built across banking, insurance, asset management, and online investing which is designed to give clients greater control, transparency, and simplicity. As Argentina moves toward normalization, our innovation-led strategy and evolving platform will be key to deepening engagement, expanding our client base, and driving profitable growth,” concluded Mr. Supervielle.
First quarter 2025 Highlights
Attributable Net Income of AR$7.9 billion in 1Q25, compared to net gains of AR$72.5 billion in 1Q24 and AR$30.6 billion in 4Q24.
ROAE was 3.5% in 1Q25, compared to 33.9% in 1Q24 and 13.9% in 4Q24. While profitability declined sequentially, underlying performance continued to reflect the successful execution of the Company’s focus on loan growth. Client Net Financial Margin increased in the mid to high teens, supported by higher spreads and loan volumes, while operating efficiency improved, with expenses declining in real terms. These positive changes were more than offset by: i) a sharp reduction in Market-related Net Financial Margin, reflecting lower yields on government securities, and ii) an increase in loan loss provisions due to the expansion of the retail portfolio which entails higher provisioning and the release of LLPs in 4Q24 resulting from improved macroeconomic conditions embedded in the ECL model. Lower YoY ROAE reflects an exceptionally high base in 1Q24, which had recorded extraordinary high results on government securities..
ROAA was 0.6% in 1Q25 compared to 7.4% in 1Q24 and 2.6% in 4Q24.
Profit before income tax totaled AR$10.2 billion in 1Q25 compared to AR$112.9 billion in 1Q24 and AR$24.6 billion in 4Q24. The sequential decline was mainly explained by: i) a 46.6%, or AR$ 43.3 billion, decline in market related Net Financial Income due to lower prices of government securities, ii) a 118.0%, or AR$ 16.7 billion, increase in loan loss provisions driven by strong growth in retail lending which entails higher provisioning and a lower comparison base in 4Q24, and iii) a 5.2%, or AR$ 645.1 million, decline in brokerage fees amid increased market volatility. These effects were partially offset by: i) a 17.2%, or AR$ 18.5 billion, increase in client net financial income, ii) a 12.3%, or AR$ 17.4 billion, decline in operating expenses, iii) a 3.4%, or AR$ 1.2 billion, increase in fee income from our banking business as fees repriced above inflation, and iv) a 2.8%, or AR$ 208.0 billion, increase in revenues from the asset management business.
Revenues (net financial income + net fee income – turnover tax) totaled AR$206.9 billion in 1Q25, compared to AR$477.2 billion in 1Q24 and AR$232.9 billion in 4Q24.
Net Financial Income totaled AR$175.4 billion in 1Q25, down 62.4% YoY and 12.4% QoQ. The QoQ decline was mainly driven by a 46.6%, or AR$43.3 billion, decrease in the Market-related Net Financial Income, reflecting lower yields on government securities amid uncertainty prior to the agreement reached with the IMF in April. In contrast, the Client Net Financial Income rose 17.2%, or AR$18.5 billion, supported by strong spreads on increased loan volumes.
Adjusted Net Financial Income (Net Financial Income + Result from exposure to inflation) totaled AR$133.6 billion in 1Q25, decreasing 55.6% YoY, and 17.7% QoQ.
Net Interest Margin (NIM) declined to 19.2% in 1Q25 from 24.9% in 4Q24. Margins from client lending remained resilient, with loan portfolio NIM improving to 21.2% from 20.7% in 4Q24, reflecting wider spreads, underscoring the strength of our core banking operations. In contrast, Investment Portfolio NIM dropped significantly to 17.7% from 33.6%, reflecting a sharp correction in treasury bond yields. The YoY comparison reflects the normalization of extraordinary factors that drove the unusually high 61.8% NIM in 1Q24, including gains from the sale of government securities previously recorded at amortized cost, high AR$ spreads on government securities and loans, and lower funding costs following the removal of deposit rate floors that quarter.
The total NPL ratio stood at a healthy 2.0% in 1Q25, up from 1.1% in 1Q24 and 1.3% in 4Q24. This increase reflects a normalization in credit quality following robust YoY growth of 196% and 58% (in real terms) in retail and commercial loan portfolios, respectively. The stronger expansion in the retail segment shifted the loan mix toward retail exposure, which typically carries higher NPL ratios than corporate lending. Despite this, the current NPL ratio remains below historical averages and is in line with the industry benchmark of 2% as of March 2025. Moreover, delinquency remains within expected levels embedded in product pricing, while we continue to refine our origination and collection strategies to preserve portfolio quality
Loan loss provisions (LLPs) totaled AR$31.8 billion in 1Q25, up 155.9% YoY and 80.9% QoQ. These increases reflect loan growth and a shift in the loan portfolio mix towards retail loans which entail higher provisioning than commercial loans. Retail loan volumes increased 12.8% QoQ and 196.3% YoY in real terms. The QoQ performance also reflects one-time provision releases recorded in the previous quarter, following an update to the macroeconomic variables in the expected credit loss model that incorporated a more favorable macroeconomic outlook. Net loan loss provisions, equivalent to LLPs net of recovered charged-off loans and reversed allowances, amounted to AR$30.9 billion in 1Q25, compared to AR$13.1 billion in 1Q24 and AR$14.2 billion in 4Q24. The Coverage Ratio stood at 152.7% as of March 31, 2025, compared to 263.7% as of March 31, 2024, and 169.2% as of December 31, 2024. Efficiency ratio was 59.6% in 1Q25, compared with 33.8% in 1Q24 and 63.8% in 4Q24. The QoQ improvement was explained by a 12.3% decline in personnel and administrative expenses, along with D&A, partially offset by a 6.1% decrease in Revenues. Excluding severance payments and early retirement charges in 1Q25 related to the Company’s efficiency program, the efficiency ratio would have been 57.6%.
Loans to Deposits Ratio was 66.5% as of March 31, 2025, compared to 43.6% as of March 31, 2024, and 69.7% as of December 31, 2024.
Total Deposits amounted to AR$3,709.7 billion, increasing 109.0% YoY and 16.9% QoQ in nominal terms. Total private sector deposits reached AR$ 3,576.6 billion, increasing 112.4% YoY and 18.1% QoQ in nominal terms, outpacing the industry, which reported growth of 95.4% YoY and 5.6% QoQ. In real terms, total deposits increased 34.0% YoY and 7.7% QoQ, while private sector deposits increased 36.2% YoY and 8.8% QoQ in real terms, above industry trends. Average deposits amounted to AR$ 3,245.4 billion, increasing 19.8% YoY and 9.0% QoQ in real terms. AR$ deposits totaled AR$2,823.3 billion, increasing 86.6% YoY and 21.6% QoQ in nominal terms, compared to industry growth of 88.4% YoY and 9.2% QoQ. In real terms, AR$ deposits increased 19.7% YoY and 12.0% QoQ.
Foreign currency deposits amounted to US$825.4 million, increasing 170.1% YoY and 0.1% QoQ, outperforming industry FX deposits which increased 73.6% YoY and declined 6.7% QoQ.
Total Assets increased 34.0% YoY and 9.1% QoQ, reaching AR$5,365.3 billion as of March 31, 2025. Total average Assets increased 27.1% YoY and 5.9% QoQ.
The QoQ performance was primarily driven by a 30.2%, or AR$321.1 billion, increase in the balance of government securities, reflecting quarter-end assets and liability management. Net Loans increased by 1.9%, or AR$44.3 billion, during the same period. Average balances reflect a more moderate QoQ increase of 13.7%, or AR$154.3 billion, in government securities, while average loans increased 14.0%, AR$291.6 billion, reflecting sustained lending activity throughout the quarter.
Since 1Q24, the Company has steadily diversified its asset portfolio, sharply increasing its exposure to private-sector loans while reducing its investment portfolio. Although loan participation declined slightly at the end of 1Q25 due to a temporary increase in government securities, the overall trend reflects a strategic shift towards a more loan-centric balance sheet, expected to continue through 2025.
The leverage ratio (Assets to Shareholders’ Equity) increased 140 bps YoY to 6.0x, from 4.6x as of March 31, 2024, and 50 bps QoQ, from 5.5x as of December 31, 2024. Despite the increase, leverage remains significantly below the 8x level reached in 2018, underscoring the ample capacity to support future growth.
Loans increased 218.4% YoY, and 11.5% QoQ in nominal terms, reaching AR$2,466.6 billion as of March 31, 2025. In real terms, gross loans increased 104.2% YoY and 2.7% QoQ. The YoY performance reflects the Company’s strategic decision since 1Q24 to accelerate loan origination across both commercial and retail segments, anticipating higher credit demand driven by declining inflation and lower market interest rates. The QoQ increase was particularly supported by strong retail loan demand, particularly in personal loans, car loans and credit cards.
Common Equity Tier 1 Ratio (CET1) was 15.3% as of March 31, 2025, decreasing 990 bps YoY and 80 bps QoQ. The QoQ decrease in CET1 reflects a non-recurring impact of 1,400 bps from the implementation of the new credit and operational risk requirements, effective January and March 2025 respectively. Moreover, the CET1 ratio reflects the expansion in Risk-weighted assets driven by loan growth, as well as higher deductions on deferred tax assets. These were partially offset by organic capital creation together with inflation adjustment of capital.
Contacts
Ana Bartesaghi
Ana.Bartesaghi@supervielle.com.ar
