Banco Santander (Brasil) SA Q3 FY2020 earnings call

• Cultural transformation: Based on four pillars - saving quick time to market, industrializing processes, encouraging new ideas, and thinking about the future and environment.
• Sustainability: Supported BRL19.3 billion social and environmental enterprises, relaunched Ethical Fund, stepped up social action programs like my [Indiscernible] and Amigo de Valor campaign.
• New business platforms: Launched Sim, a straightforward lending platform aiming for BRL10 billion portfolio in five years; Debt renegotiation platform has attracted 3.3 million customers and has potential for BRL0.5 billion EBT in five years; Announced combination of total MP pending regulatory approvals; [Indiscernible] strengthened automotive solutions ecosystem; Browser platform reached breakeven in one year with over 310,000 partner establishments and over 160,000 cards issued.
• Customer growth: Active customer base grew 71% in five years to over 27 million clients, added over 1.3 million active customers in the last year and 660,000 digital account holders, NPS increased by 4 points to 62 in 12 months.
• Product and service growth: Santander Consumer Finance NPS 83, Acquiring market share growth, Cards user and turnover growth, Federal loans market share increase, Mortgage digital leadership and growth, Home equity growth, Investment products through acquisition and merger.
• Countryside expansion: Bet on expanding into Brazil's countryside, opening smaller branches and segment dedicated stores, agri portfolio tripled in five years with growth nine times higher than the market.

Santander Consumer Finance: Over the past five years, it has grown against the market trend, with an NPS of 83 points and a 25% share in August 2020. Acquiring: Market share went from close to 0 in 2013 to 30% now, expecting to close 2020 with 15%. Cards: Over the last five years, card base expanded by 50% and turnover doubled, with Santander Way app having 8 million active users and an NPS of 82. Federal loans: Market share climbed to 11.4% with a portfolio expanding 2.4 times compared to the market growth of 52%. Mortgage: Since 2018, it has been a first mover in the segment, growing 4.3 times higher than the market in the last three years, reaching BRL2 billion in origination in September 2020. Home equity: Origination has grown twofold compared to the same period last year, capturing over 32% of the market's remuneration. Investment products: Ambition is to achieve a market share of 11% over the next three years. Agri portfolio: Over the last five years, it has tripled, with growth nine times higher than the market, expecting to reach BRL30 billion in 2022. Prospera: Microcredit program has a portfolio of more than BRL1 billion with over 540,000 active customers, potential to increase by more than two times in three years.

• Sim platform: Aiming for a portfolio of BRL10 billion in five years.
• Debt renegotiation platform: Potential to achieve BRL0.5 billion EBT in five years.
• Investment products: Ambition to achieve a market share of 11% over the next three years.
• Agri portfolio: Expecting to reach BRL30 billion in 2022.
• Prospera: Microcredit program portfolio potential to increase by more than two times in three years.

• General economic conditions, industry conditions, and other operational factors may affect future performance and cause actual results to differ from forward-looking statements.
• Regulatory changes may impact the over hedge situation.
• Pressure on spreads may continue.
• NPLs may increase as clients under moratorium pass some time.

Q: On the issue of provisions and asset quality, with NPL expectations and impact on provisions.

A: The reprogrammed portfolio has a 1% NPL ratio over 90 days, and it will increase in the next month. But we are in good levels, and we feel no additional extraordinary provisions will be needed as we have the BRL3.2 billion from second Q at our disposal and the portfolio is performing in a different way with most clients already starting to pay.

Q: On the government programs impact on bank's margins and cost risk.

A: Originated about BRL10 billion more or less of government programs in this quarter to the SME segment. They tend to have lower spread and lower costs of risk in different conditions, and some free capital, impacting the bank's margins and cost risk in different ways.