Banco Macro S.A. Q1 FY2026 earnings call

- Financial Position & Profitability * Reported net income outperformed prior adjusted ROE guidance for the quarter, with an annualized return on average equity (ROE) of 10% (10.9% adjusted for non-recurring items) and annualized return on average assets (ROA) of 2.4% * Maintains strong solvency, with 4 trillion pesos in excess capital and a 32.4% capital adequacy ratio, well above regulatory requirements * Net interest margin (NIM) expanded in Q1 2026 compared to prior quarters, driven by a larger drop in funding costs relative to asset yields

- Operational Efficiency Initiatives * Reduced the branch network by 24 branches to 420 total, and cut headcount by 3% QoQ * Recorded 19.9 billion pesos in restructuring expenses related to early retirement programs * Excluding restructuring costs, employee benefits declined 6% YoY, and management targets negative real expense growth for full-year 2026 to improve efficiency

- Balance Sheet & Market Position * The bank's strategy of holding a short US dollar position was profitable in the quarter * Private sector loan market share was 8.2% as of March 2026, down 40bps QoQ; private sector deposit market share held steady at 7.9% * Inflation in Q1 2026 was 9.44%, 158bps higher than Q4 2025

- Asset Quality * NPL ratios increased across consumer and commercial portfolios in the quarter, but Banco Macro maintains the lowest NPL ratio and highest coverage ratio among its Argentine peers * Management conducted more frequent model recalibration (required annually by regulation) to reflect rising default probabilities during the recent delinquency cycle, resulting in more conservative provisioning than peer banks

As a commercial bank, Banco Macro does not report segmented product performance in this transcript. The overall core operating results for Q1 2026 are as follows: net income totaled 139.8 billion pesos, 28% higher quarter-over-quarter (QoQ) and 131% higher year-over-year (YoY); adjusted net income (excluding supplementary taxes) was 152.9 billion pesos. Net interest income reached 975.2 billion pesos, 7% higher QoQ and 27% higher YoY, accounting for 72% of total operating income. Interest expense totaled 485.7 billion pesos, down 21% QoQ. Operating income after operating expenses was 569.8 billion pesos, 15% higher QoQ and 24% higher YoY. General and administrative plus employee benefits expenses totaled 349.8 billion pesos, down 22% QoQ and up 3% YoY. Total assets stood at 10.63 trillion pesos, down 9% QoQ and up 5% YoY. Total deposits reached 13.99 trillion pesos, down 7% QoQ and up 10% YoY, representing 76% of total liabilities. The non-performing loan (NPL) ratio under central bank methodology was 5.4%, and the coverage ratio reached 109.79%. The capital adequacy ratio was 32.4%.

- Loan and deposit growth guidance: Maintains prior guidance of 42% nominal full-year loan growth (15-20% real growth, consistent with prior guidance) and 34% nominal full-year deposit growth. Quarterly declines in Q1 2026 are attributed to seasonal factors, and management has observed recovering credit demand in April and May 2026. Dollar loan growth is expected to outpace peso loan growth in 2026, driven by demand from export-oriented sectors. - ROE guidance: Maintains the prior adjusted ROE (excluding non-recurring items) guidance of ~8% for full-year 2026. Management will wait for Q2 2026 results to assess whether an upward revision is warranted, as Q1 2026 adjusted ROE came in above guidance and Q2 2026 is also tracking positively. - Cost of risk guidance: Maintains prior full-year cost of risk guidance of 5.5-6%. Management expects asset quality to be close to a peak after four months of deterioration. - Net interest margin guidance: Management expects a small contraction in NIM for the remainder of 2026, with full-year average NIM expected to be similar to 2025 levels. Downward pressure on NIM will come primarily from falling asset yields as nominal interest rates decline with slowing inflation. - OPEX guidance: Management continues to target negative real expense growth for full-year 2026, even after excluding restructuring costs.

- Ongoing asset quality deterioration: The bank has seen rising NPL ratios across consumer and commercial loan portfolios amid a macroeconomic delinquency cycle, with deterioration concentrated in consumer lending. - Macroeconomic volatility: Argentina's high inflation environment and exchange rate uncertainty create ongoing balance sheet and profitability volatility. - Regulatory risk: Required model recalibration and capital/dividend regulations limit capital distribution flexibility and can result in higher near-term provisioning expenses. - Slower-than-expected economic recovery: If the nascent economic recovery does not continue, asset quality may deteriorate further than current expectations, and credit demand growth may fall short of guidance.

Q: Are you maintaining prior full-year guidance for loan and deposit growth, and what are your near-term asset quality trends? / A: Management maintains all prior guidance for loan, deposit, and cost of risk growth. Q1 loan declines were driven by lower overdraft balances (a liquidity management product), while core loan segments are growing 20% YoY. Credit demand has recovered in April and May, supporting maintained guidance. Management observed peak consumer Stage 3 NPLs in February, with improving trends in March and April, and a slowdown in commercial NPL deterioration, suggesting the asset quality cycle is near a peak. Banco Macro also maintains stronger provisioning coverage than peers at ~110%.

Q: Why is Banco Macro the only bank implementing mandatory customer delinquency recalibration this quarter, and is this more conservative than peers? / A: All banks are required to recalibrate default probability models at least annually. Management chose to recalibrate early (more frequently than peers) during the current upward delinquency cycle to avoid a large cumulative provisioning hit at year-end. Additionally, Banco Macro's internal risk model is inherently more conservative than peer models, resulting in higher coverage ratios versus the peer average of 90%. This conservatism is intentional, and coverage will be reduced gradually if delinquency trends improve as expected.

Q: What are Banco Macro's capital allocation priorities, and what is the timeline for integrating the acquired Banco Science? / A: Management prioritizes maintaining a strong capital position to support organic growth (given Argentina's very low loans-to-GDP ratio relative to regional peers), support recent investments in Personal Pay and Banco Science, and pursue future inorganic M&A as banking sector consolidation continues. Dividends are currently constrained by central bank regulation limiting payouts to 60% of approved earnings. Central bank approval for the Banco Science acquisition is still pending, with management's base case expecting approval in H2 2026 and full integration to support the Personal Pay digital wallet by Q1 2027. Preparatory work for integration is already underway.

Q: Is the amortized cost bond portfolio managed flexibly to capture opportunistic gains? / A: Management confirms the portfolio is actively managed to capture market opportunities. The recent 70 billion peso gain from selling shorter-dated appreciated bonds, followed by reinvestment in longer-dated higher-yielding inflation-linked bonds, reflects this approach. Management will continue to pursue similar opportunistic rebalancing if favorable market conditions arise in the future.