AGI, Inc. (Brazil) Q1 FY2026 earnings call

Strategic progress includes total active customers growing over 50% year-over-year, product penetration evolving with customers using over 6 products on average and over 7 among most mature cohorts. Company evolved into business unit-driven organization with centralized risk management, data, and AI for improved decision-making speed and cost reduction. Business model resilient with recovery in payroll credit ecosystem and fee business inflection in March. Customer growth: total active customers up 53% year-over-year, 5% quarter-over-quarter. Credit portfolio: total loan balances up 30% year-over-year, private payroll credit portfolio at R$1 billion, public payroll credit stable at R$0.3 billion, unsecured lending up 4.8% year-over-year. INSS payroll credit market share 9% in Q1, up 210 bps. Credit quality: non-performing loans slightly down, coverage ratio comfortable. Revenue: total revenue R$3 billion, up 24% year-over-year. Net interest income up 9% year-over-year. Operating efficiency ratio improved. Funding: total deposits up 37% from Q1 2025. Equity up 42% in March 2026. Capital adequacy ratio 19.3% in Q1.

Total active customer count increased 53% year-over-year in Q1 2026 to over 7 million. Total loan balances grew 30% year-over-year in Q1 2026 to R$35.5 billion, with secured loans representing 87% (R$30.7 billion) and unsecured loans 13% (R$4.8 billion). Private payroll credit portfolio reached R$1 billion. Public payroll credit finished Q1 at R$0.3 billion. Unsecured lending expanded 4.8% year-over-year to R$4.7 billion. Market share in INSS payroll credit was 9% in Q1, up 210 bps year-over-year. Non-performing loans exceeding 90 days declined slightly to 3.6% in Q1. Coverage ratio was 165% at end-March. Total revenue was R$3 billion, up 24% year-over-year and 1% quarter-over-quarter. Net interest income grew 9% year-over-year and 4% quarter-over-quarter to R$1.3 billion. Operating efficiency ratio improved to 43.2% in Q1. Recurring net income reached R$186.5 million, up 14.7% quarter-over-quarter.

We remain confident in AGI's long-term investment thesis, execution capacity, and market positioning. We look forward to the company being a winner in the segment, addressing the financial needs of millions of Brazilians. No formal guidance provided at this point.

Regulatory environment uncertainty, including TCU decisions and Desenrola program impacts. Product adjustments temporarily impacted insurance business production. Short-term fluctuations in unsecured lending portfolio.

Q: Tito Labarta asked about regulatory environment, impact of INSS payroll loans suspension, Desenrola 2.0 and unsecured lending pickup.

A: Not concerned about TCU decision, operational remains fully operating, around 25% of unsecured portfolio eligible for Desenrola program benefits, unsecured origination normalizing in March.

Q: Gustavo Schroden asked about insurance brokerage revenues and net interest margin trend.

A: Insurance brokerage saw March recovery, measures taken to reshape user experience, NIM impacted by asset mix and SELIC rate, expected to normalize with unsecured portfolio recovery and SELIC rate change.

Q: Ricardo Botch Pigo asked about OPEX reduction and loan origination recovery for year-over-year bottom line growth.

A: OPEX in normalized level, loan origination recovered, expect financials to improve in short to medium term, especially in second half.

Q: Pedro Leduque asked about provision expenses for bad credit and personnel expense.

A: Write-offs driven by timing change to 270 days, offset by provision reversals, personnel expense related to seasonal and performance-based compensation.

Q: Marcelo Misaí asked about other liabilities of partnership program.

A: Liability provision for buyback of management shares no longer applicable as public company, no cash or income statement impact.

Q: Renato Meloni asked about impacts of payroll loan margin reduction and risk-adjusted margin.

A: Short-term positive inflow from salary benefits, long-term sustainable with healthy portfolio and long-term relationships, product has appetite with loss absorption concept.

Q: Neha Agarwala asked about private payroll origination and asset quality trend.

A: Private payroll origination picked up with cautious acceleration, asset quality NPL levels stable ahead due to portfolio mix and short-term KPIs.

Q: Rainey Kilmer asked about net interest income, loan, and net income growth outlook.

A: No formal guidance provided.

Q: Jamie Friedman asked about regulatory changes frequency and secured vs unsecured long-term evolution.

A: Regulatory changes normal in Brazilian market, long-term secured lending to be around 10% and unsecured around 90% of credit portfolio.

Q: Henrique Navarro asked about market share in INSS origination vs portfolio.

A: March origination surpassed market share in portfolio.