SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

 

 

 

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE

SECURITIES EXCHANGE ACT OF 1934

 

November 30, 2020

 

 

 

Commission File Number: 001-32827

 

 

 

MACRO BANK INC.

(Translation of registrant’s name into English)

 

 

 

Avenida Eduardo Madero 1182

Ciudad Autónoma de Buenos Aires C1106 ACY

Tel: 54 11 5222 6500

 

(Address of registrant’s principal executive offices)

 

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F x Form 40-F ¨

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

 

Yes ¨ No x

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

 

Yes ¨ No x

 

 

 

 

 

 


 

 

    3Q20 Earnings Release

 

Banco Macro Announces Results for the Third Quarter of 2020

 

Buenos Aires, Argentina, November 30, 2020 – Banco Macro S.A. (NYSE: BMA; BYMA: BMA) (“Banco Macro” or “BMA” or the “Bank”) announced today its results for the third quarter ended September 30, 2020 (“3Q20”). All figures are in Argentine pesos (Ps.) and have been restated in terms of the measuring unit current at the end of the reporting period. As of 1Q20, the Bank began reporting results applying Hyperinflation Accounting, in accordance with IFRS IAS 29 as established by the Central Bank. For ease of comparison, figures of previous quarters of 2019 have been restated applying IAS 29 to reflect the accumulated effect of the inflation adjustment for each period through September 30, 2020.

 

Summary

 

• The Bank’s net income totaled Ps.6.1 billion in 3Q20. This result was 12% lower than the result posted in 2Q20 and 33% lower than in 3Q19. In 3Q20, the accumulated annualized return on average equity (“ROAE”) and the accumulated annualized return on average assets (“ROAA”) were 21.5% and 4.6%, respectively.

 

• In 3Q20, Banco Macro’s financing to the private sector decreased 2% or Ps.3.9 billion quarter over quarter (“QoQ”) totaling Ps.232.2 billion and 12% or Ps.31.9 billion year over year (“YoY”). In the quarter consumer loans stood out, among which Credit card loans stood out; with a 8% increase QoQ, meanwhile within commercial loans Others stood out with a 7% increase QoQ, mainly driven by the 24% loans to SMEs.

 

• In 3Q20, Banco Macro’s total deposits increased 13% or Ps.55.6 billion QoQ, totaling Ps.493 billion and representing 83% of the Bank’s total liabilities. Private sector deposits increased 4% or Ps.14.2 billion QoQ.

 

• Banco Macro continued showing a strong solvency ratio, with an excess capital of Ps.116.9 billion, 34.8% regulatory capital ratio – Basel III and 27.3% Tier 1 Ratio. In addition, the Bank’s liquid assets remained at an adequate level, reaching 87% of its total deposits in 3Q20.

 

• In 3Q20, the Bank’s non-performing to total financing ratio was 1.14% and the coverage ratio improved to 302.9%.

 

 3Q20 Earnings Release Conference Call

 

Tuesday, December 1, 2020
Time: 10:00 a.m. Eastern Time | 12:00 p.m. Buenos Aires Time

 

 

 IR Contacts in Buenos Aires:

 

Jorge Scarinci

Chief Financial Officer

 

Nicolás A. Torres

Investor Relations

 

Phone: (54 11) 5222 6682

E-mail: investorelations@macro.com.ar

 

Visit our website at:
www.macro.com.ar/relaciones-inversores

 

 To participate, please dial:

Argentina Toll Free:

(011) 3984 5677

Participants Dial In (Toll Free):

+1 (844) 450 3847

Participants International Dial In:

+1 (412) 317 6370

Conference ID: Banco Macro

Webcast: click here

 

 

 

 

Webcast Replay: click here

 

Available from 12/01/2020 through 12/15/2020

 

 

2 

 

 

    3Q20 Earnings Release

 

Disclaimer

 

This press release includes forward-looking statements. We have based these forward-looking statements largely on our current beliefs, expectations and projections about future events and financial trends affecting our business. Many important factors could cause our actual results to differ substantially from those anticipated in our forward-looking statements, including, among other things: inflation; changes in interest rates and the cost of deposits; government regulation; adverse legal or regulatory disputes or proceedings; credit and other risks of lending, such as increases in defaults by borrowers; fluctuations and declines in the value of Argentine public debt; competition in banking and financial services; deterioration in regional and national business and economic conditions in Argentina; and fluctuations in the exchange rate of the peso.

 

The words “believe,” “may,” “will,” “aim,” “estimate,” “continue,” “anticipate,” “intend,” “expect” and similar words are intended to identify forward-looking statements. Forward-looking statements include information concerning our possible or assumed future results of operations, business strategies, financing plans, competitive position, industry environment, potential growth opportunities, the effects of future regulation and the effects of competition. Forward-looking statements speak only as of the date they were made, and we undertake no obligation to update publicly or to revise any forward-looking statements after we distribute this press release because of new information, future events or other factors. In light of the risks and uncertainties described above, the forward-looking events and circumstances discussed in this press release might not occur and are not guarantees of future performance.

 

This report is a summary analysis of Banco Macro's financial condition and results of operations as of and for the period indicated. For a correct interpretation, this report must be read in conjunction with all other material periodically filed with the Comisión Nacional de Valores (www.cnv.gob.ar), the Securities and Exchange Commission (www.sec.gov), Bolsas y mercados Argentinos (www.byma.com.ar) and the New York Stock Exchange (www.nyse.com). In addition, the Central Bank (www.bcra.gov.ar) may publish information related to Banco Macro as of a date subsequent to the last date for which the Bank has published information.

 

Readers of this report must note that this is a translation made from an original version written and expressed in Spanish. Consequently, any matters of interpretation should be referred to the original version in Spanish.

 

3 

 

 

    3Q20 Earnings Release

 

This Earnings Release has been prepared in accordance with the accounting framework established by the Central Bank of Argentina (“BCRA”), based on International Financial Reporting Standards (“I.F.R.S.”) and the resolutions adopted by the International Accouting Standards Board (“I.A.S.B”) and by the Federación Argentina de Consejos Profesionales de Ciencias Económicas (“F.A.C.P.E.”). As of January 2020 the Bank started reporting with the application of (i) Expected losses of IFRS 9 “Financial Instruments” and (ii) IAS 29 “Financial Reporting in Hyperinflationary Economies”. Data and figures shown in this Earnings Release may differ from the ones shown in the 20-F annual report.

 

Results

 

Earnings per outstanding share were Ps.9.51 in 3Q20, 12% lower than 2Q20 and 33% lower than the result posted a year ago.

 

EARNINGS PER SHARE   MACRO Consolidated   Change  
In MILLION $ (Measuring Unit Current at EOP)     3Q19     4Q19     1Q20     2Q20     3Q20     QoQ       YoY  
Net income -Parent Company- (M $)     9,112     6,956     8,025     6,885     6,076     -12 %     -33 %
Average # of shares outstanding (M)     639     639     639     639     639     0 %     0 %
Average #of treasury stocks (shares repurchased) (M)     19     -     -     -     -     -       -100 %
Book value per avg. Outstanding share ($)     184     201     211     201     210     4 %     14 %
Shares Outstanding (M)     639     639     639     639     639     0 %     0 %
Earnings per avg.  outstanding share ($)     14.26     10.89     12.56     10.77     9.51     -12 %     -33 %
                                               
EOP FX (Pesos per USD)     57.5583     59.8950     64.4700     70.4550     76.1750     8 %     32 %
Book value per avg. issued ADS (USD)     31.97     33.56     32.73     28.53     27.57     -3 %     -14 %
Earnings per avg. outstanding ADS (USD)     2.48     1.82     1.95     1.53     1.25     -18 %     -50 %

 

Banco Macro’s 3Q20 net income of Ps.6.1      billion was 12% or Ps.809 million lower than the previous quarter and 33% or Ps.3 billion lower YoY. This result represented an accumulated ROAE and ROAA of 21.5% and 4.6% respectively.

 

Net operating income (before G&A and personnel expenses) was Ps.19.6 billion in 3Q20, decreasing 18% or Ps.4.3 billion compared to 2Q20 and decreased 5% or Ps.1.1 billion compared to the previous year.

 

In 3Q20 Provision for loan losses totaled Ps.1.8 billion, 31% or Ps.774 million lower than in 2Q20. In the previous quarter loan loss provisions were explained by additional provisions made by the Bank based on estimations of the macroeconomic impact of the current Covid-19 pandemic. In this quarter three main groups showing signs of credit deterioration were included in the estimates; i) Ps.617 million related to loans with deferred installments (both commercial and consumer), ii) Ps.600 million related to refinancing of outstanding credit card balances and iii) Ps.531 million related to the 24% loans extended to SMEs, from sectors or activities which the Bank considered troubled o likely to have some trouble.

 

Operating income (after G&A and personnel expenses) was Ps.4.4 billion in 3Q20, 52% or Ps.4.8 billion lower than in 2Q20 and Ps.4.5 billion higher than a year ago.

 

It is important to emphasize that this result was obtained with a leverage of only 5.5x assets to equity ratio.

 

4 

 

 

  3Q20 Earnings Release

 

INCOME STATEMENT   MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)   3Q19     4Q19     1Q20     2Q20     3Q20     QoQ     YoY  
Net Interest Income     28,731       28,958       24,164       21,576       21,159       -2 %     -26 %
Net fee income     5,395       5,237       5,027       5,004       5,271       5 %     -2 %
Net Interest Income + Net Fee Income     34,126       34,195       29,191       26,580       26,430       -9 %     -17 %
Net Income from financial instruments at fair value through P&L     -16,732       -315       -4,643       -2,163       -7,541       249 %     -55 %
Income from assets at amortized cost     0       66       967       20       61       205 %     -  
Differences in quoted prices of gold and foreign currency     2,138       1,670       604       846       1,207       43 %     -44 %
Other operating income     1,510       1,147       1,247       1,145       1,182       3 %     -22 %
Provision for loan losses     393       1,776       977       2,523       1,749       -31 %     345 %
Net Operating Income     20,649       34,987       26,389       23,905       19,590       -9 %     27 %
Employee benefits     6,350       6,339       5,361       6,174       6,199       0 %     -2 %
Administrative expenses     4,153       4,190       3,034       3,126       3,400       9 %     -18 %
Depreciation and impairment of assets     956       950       948       992       1,015       2 %     6 %
Other operating expenses     9,334       5,879       4,905       4,412       4,587       4 %     -51 %
Operating Income     -144       17,629       12,141       9,201       4,389       -24 %     -  
Result from associates & joint ventures     24                       9       15       67 %     -38 %
Result from net monetary postion     8,185       32       23       479       4,836       910 %     -41 %
Result before taxes from continuing operations     8,065       -5,644       335       9,689       9,240       -22 %     20 %
Income tax     -1,047       12,017       12,499       2,804       3,164       13 %     -402 %
Net income from continuing operations     9,112       5,061       4,474       6,885       6,076       -14 %     111 %
              -       -                                  
Net Income of the period     9,112       6,956       8,025       6,885       6,076       -14 %     111 %
Net income of the period attributable to parent company     9,112       6,956       8,025       6,885       6,076       -12 %     -33 %
Net income of the period attributable to minority interest     0       -       -       0       0       -       -  

 

The Bank’s 3Q20 net interest income totaled Ps.21.2 billion, 2% or Ps.417 million lower than in 2Q20 and 26% or Ps.7.6 billion lower YoY.

 

In 3Q20 interest income totaled Ps.36.8 billion, 15% or Ps.4.9 billion higher than in 2Q20 (due to higher income from securities) and 28% or Ps.14.3 billion lower than in 3Q19.

 

Income from interest on loans and other financing totaled Ps.17.8 billion, 9% or Ps.1.7 billion lower compared with the previous quarter, due to a 155 b.p. decrease in the average lending rate (down from 31.5% in 2Q20 to 30% in 3Q20), while the average volume of private sector loans decreased 5%. On a yearly basis Income from interest on loans decreased 23% or Ps.5.4 billion.

 

In 3Q20 income from government and private securities increased 56% or Ps.6 billion QoQ (due to higher income from Government securities) and increased 39% or Ps.11 billion compared with the same period of last year. This result is explained 90% by income from government and private securities through other comprehensive income (Central Bank Notes) and the remaining 10% is explained by income from government and private securities at amortized cost.

 

In 3Q20 income from Repos totaled Ps.2.1 billion, 33% or Ps.525 million higher than the previous quarter and Ps.2 billion higher than a year ago.

 

In 3Q20 FX income totaled a Ps.1.2 billion gain, due to the 8% argentine peso depreciation against the US dollar and the Bank’s long spot dollar position during the quarter and FX trading results (Ps.457 million).

 

5 

 

 

  3Q20 Earnings Release

 

FX INCOME   MACRO Consolidated     Variation  
In MILLION $ (Measuring Unit Current at EOP)   3Q19     2Q20     3Q20     QoQ     YoY  
(1) Differences in quoted prices of gold and foreign currency     2,138       846       1,207       43 %     -44 %
Translation of FX assets and liabilities to Pesos     481       683       750       10 %     56 %
Income from foreign currency exchange     1,656       162       457       181 %     -72 %
                                         
(2) Net Income from financial assets and liabilities at fair value through P&L     1,062       20       2       -90 %     -100 %
Income from investment in derivative financing instruments     1,062       20       2       -90 %     -100 %
                                         
(1) +(2) Total Result from Differences in quoted prices of gold and foreign currency     3,200       866       1,209       40 %     -62 %

 

INTEREST INCOME   MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)   3Q19     4Q19     1Q20     2Q20     3Q20     QoQ     YoY  
Interest on Cash and due from Banks     125       84       69       15       29       93 %     -77 %
Interest from government securities     27,357       11,458       11,850       10,490       16,633       59 %     -39 %
Interest from private securities     520       1,223       662       373       264       -29 %     -49 %
Interest on loans and other financing                                                        
To the financial sector     540       559       286       269       196       -27 %     -64 %
To the public non financial sector     103       348       630       418       509       22 %     394 %
Interest on overdrafts     4,783       8,856       4,608       3,081       1,443       -53 %     -70 %
Interest on documents     1,383       1,599       1,444       983       796       -19 %     -42 %
Interest on mortgages loans     2,114       2,844       2,039       1,605       1,552       -3 %     -27 %
Interest on pledged loans     185       160       121       104       105       1 %     -43 %
Interest on personal loans     8,870       8,158       7,553       7,507       7,156       -5 %     -19 %
Interest on credit cards loans     3,730       3,670       3,104       2,455       2,505       2 %     -33 %
Interest on financial leases     40       36       25       13       4       -69 %     -90 %
Interest on other loans     1,363       2,005       2,261       2,979       3,494       17 %     156 %
Interest on Repos                                                        
From the BCRA     0       480       365       1,578       2,094       33 %     -  
Other financial institutions     11       411       47       1       10       900 %     -9 %
Total Interest income     51,124       41,891       35,064       31,871       36,790       15 %     -28 %
                                                         
Income from Interest on loans     23,111       28,235       22,071       19,414       17,760       -9 %     -23 %

 

The Bank’s 3Q20 interest expense totaled Ps.15.6 billion, increasing 52% or Ps.5.3 billion compared to the previous quarter and decreasing 30% (Ps.6.8 billion) compared to 3Q19.

 

In 3Q20, interest on deposits represented 94% of the Bank’s total interest expense, increasing 58% or Ps.5.4 billion QoQ, due to a 300 b.p. increase in the average rate paid on deposits (up from 13.6% in 2Q20 to 16.6% in 3Q20, this increase can be traced to a 458 b.p QoQ increase in the average Badlar rate). The average volume of deposits from the private sector increased 13%. On a yearly basis, interest on deposits decreased 28% or Ps.5.8 billion.

 

6 

 

 

  3Q20 Earnings Release

 

INTEREST EXPENSE   MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)   3Q19     4Q19     2Q20     2Q20     3Q20     QoQ     YoY  
Deposits                                                        
Interest on checking accounts     152       34       136       120       424       253 %     179 %
Interest on saving accounts     164       230       165       133       124       -7 %     -24 %
Interest on time deposits     20,153       11,710       9,632       9,069       14,155       56 %     -30 %
Interest on other financing from BCRA and financial inst.     90       59       25       15       17       13 %     -81 %
Repos                                                        
Other financial institutions     77       40       74       22       2       -91 %     -97 %
Interest on corporate bonds     1,136       247       323       386       348       -10 %     -69 %
Interest on subordinated bonds     553       547       520       536       552       3 %     0 %
Interest on other financial liabilities     68       66       25       14       9       -36 %     -87 %
Total financial expense     22,393       12,933       10,900       10,295       15,631       52 %     -30 %
                                                         
Expenses from interest on deposits     20,469       11,974       9,933       9,322       14,703       58 %     -28 %

 

As of 3Q20, the Bank’s accumulated net interest margin (including FX) was 20.3%, lower than the 22.3% posted in 2Q20 and the 21.5% posted in 3Q19.

 

In 3Q20 Net Interest Margin (excluding FX) was 19.5%, lower than the 21.6% posted in 2Q20 and than the 20.8% posted in 3Q19.

 

In 3Q20 Net Interest Margin (Pesos) was 18.6%, lower than the 23% posted in 2Q20 and than the 34.3% in 3Q19; meanwhile Net Interest Margin (USD) was 1.8%, lower than the 2.3% posted in 2Q20 and higher than the 0.6% registered in 3Q19.

 

ASSETS & LIABILITIES
PERFORMANCE (AR$) 		  MACRO Consolidated  
In MILLION $   3Q19     4Q19     1Q20     2Q20     3Q20  
(Measuring Unit Current at EOP)     AVERAGE       REAL INT       NOMINAL       AVERAGE       REAL INT       NOMINAL       AVERAGE       REAL INT       NOMINAL       AVERAGE       REAL INT       NOMINAL       AVERAGE       REAL INT       NOMINAL  
Yields & rates in annualized nominal %     BALANCE       RATE       INT RATE       BALANCE       RATE       INT RATE       BALANCE       RATE       INT RATE       BALANCE       RATE       INT RATE       BALANCE       RATE       INT RATE  
Interest-earning assets                                                                                                                        
Loans & Other Financing                                                                                                                        
      Public Sector     2,094       -20.1 %     19.5 %     3,512       -4.9 %     39.3 %     7,065       3.4 %     35.9 %     6,749       2.7 %     24.9 %     5,025       7.5 %     40.3 %
      Financial Sector     4,063       1.7 %     52.1 %     4,062       5.1 %     54.0 %     2,403       11.4 %     46.4 %     2,547       17.0 %     42.3 %     1,927       7.5 %     40.3 %
      Private Sector     170,025       -0.1 %     49.4 %     212,840       1.2 %     48.2 %     191,320       7.6 %     41.4 %     199,761       11.3 %     35.4 %     201,621       1.0 %     31.8 %
Other debt securities                                                                                                                        
      Central Bank Securities (Leliqs)     133,981       15.5 %     72.7 %     27,756       37.2 %     101.0 %     82,013       10.9 %     45.7 %     91,354       13.1 %     37.5 %     121,719       5.4 %     37.5 %
      Government & Private Securities     19,159       12.7 %     68.5 %     25,407       27.8 %     87.2 %     22,875       18.7 %     55.9 %     30,733       7.3 %     30.5 %     72,175       -0.6 %     29.7 %
Repos     46       30.3 %     94.9 %     4,372       23.5 %     80.9 %     3,786       9.5 %     43.8 %     36,760       -3.5 %     17.3 %     43,732       -8.7 %     19.1 %
Total interest-earning assets     329,368       6.8 %     59.8 %     277,949       7.6 %     57.6 %     309,462       9.3 %     43.6 %     367,904       9.9 %     33.6 %     446,199       1.1 %     31.9 %
                                                                                                                         
Non interest-earning assets     71,723                       112,387                       102,340                       110,445                       69,832                  
Total Average Assets     401,091                       390,336                       411,802                       478,349                       516,031                  
                                                                                                                         
Interest-bearing liabilities                                                                                                                        
Deposits                                                                                                                        
      Public Sector     17,422       -8.6 %     36.7 %     9,775       -5.1 %     39.0 %     13,159       -4.6 %     25.3 %     19,698       -0.3 %     21.3 %     52,140       -4.3 %     24.8 %
      Private Sector     200,446       -8.9 %     36.2 %     148,160       -12.0 %     28.9 %     160,855       -6.9 %     22.3 %     192,661       -3.8 %     17.0 %     224,237       -7.9 %     20.2 %
BCRA and other financial institutions     697       1.9 %     52.4 %     266       32.4 %     94.0 %     390       -4.2 %     25.8 %     427       -3.8 %     17.0 %     408       -7.6 %     20.5 %
Corporate bonds     8,311       3.1 %     54.2 %     7,035       -22.3 %     13.9 %     6,188       -7.9 %     21.0 %     5,206       6.7 %     29.8 %     4,963       -2.0 %     27.9 %
Repos     488       8.7 %     62.6 %     317       2.5 %     50.1 %     1,305       -6.1 %     23.4 %     939       -10.0 %     9.4 %     49       -10.9 %     16.2 %
Total int.-bearing liabilities     227,364       -8.4 %     37.0 %     165,553       -11.9 %     29.0 %     181,897       -6.8 %     22.5 %     218,931       -3.2 %     17.7 %     281,797       -7.1 %     21.2 %
                                                                                                                         
Total non int.-bearing liabilities     84,179                       106,478                       106,002                       139,133                       148,631                  
                                                                                                                         
Total Average Liabilities     311,543                       272,031                       287,899                       358,064                       430,428                  
                                                                                                                         
Assets Performance             49,668                       40,321                       33,516                       30,703                       35,798          
Liabilities Performance             21,195                       12,103                       10,188                       9,620                       14,983          
Net Interest Income             28,473                       28,218                       23,328                       21,083                       20,815          
Total interest-earning assets             329,368                       277,949                       309,462                       367,904                       446,199          
Net Interest Margin (NIM)             34.3 %                     40.3 %                     30.3 %                     23.0 %                     18.6 %        

 

7 

 

 

    3Q20 Earnings Release

 

ASSETS & LIABILITIES
PERFORMANCE USD
In MILLION $ 		  MACRO Consolidated  
(Measuring Unit Current at EOP)   3Q19     4Q19     1Q20     2Q20     3Q20  
Yields & rates in annualized   AVERAGE     REAL INT     NOMINAL     AVERAGE     REAL INT     NOMINAL     AVERAGE     REAL INT     NOMINAL     AVERAGE     REAL INT     NOMINAL     AVERAGE     REAL INT     NOMINAL  
nominal %   BALANCE      RATE      INT RATE      BALANCE    RATE      INT RATE      BALANCE      RATE      INT RATE      BALANCE      RATE      INT RATE      BALANCE      RATE      INT RATE   
Interest-earning assets                                                                                          
Cash and Deposits in Banks     84,692       62.3 %     0.6 %     33,313       -20.0 %     1.0 %     34,930       0.3 %     0.8 %     43,510       13.0 %     0.1 %     44,600       1.7 %     0.3 %
Loans & Other Financing                                                                                                                        
Public Sector     0       0.0 %     0.0 %     0       0.0 %     0.0 %     0       0.0 %     0.0 %     0       0.0 %     0.0 %     0       0.0 %     0.0 %
Financial Sector     399       71.0 %     6.0 %     385       -15.8 %     6.2 %     522       6.4 %     6.9 %     68       19.6 %     5.9 %     56       8.6 %     7.1 %
Private Sector     80,918       71.6 %     6.4 %     48,321       -11.3 %     11.9 %     47,780       11.6 %     12.2 %     39,305       26.1 %     11.7 %     24,878       16.8 %     15.2 %
Other debt securities                                                                                                                        
Government & Private Securities     0       0.0 %     0.0 %     2,104       -16.9 %     4.9 %     3,174       1.7 %     2.2 %     4,447       13.5 %     0.5 %     4,583       2.5 %     1.1 %
Total interest-earning assets     166,009       66.9 %     3.5 %     84,123       -14.9 %     7.4 %     86,406       6.7 %     7.2 %     87,330       19.0 %     5.4 %     74,117       6.8 %     5.3 %
                                                                                                                         
Non interest-earning assets     10,384                       55,971                       49,517                       45,092                       93,032                  
Total Average Assets     176,393                       140,094                       135,923                       132,422                       167,149                  
                                                                                                                         
Interest-bearing liabilities                                                                                                                        
Deposits                                                                                                                        
Public Sector     2,484       64.4 %     1.9 %     1,309       -18.6 %     2.7 %     2,244       0.6 %     1.1 %     1,418       13.9 %     0.9 %     776       1.9 %     0.5 %
Private Sector     104,037       64.8 %     2.2 %     65,184       -19.6 %     1.4 %     64,143       0.5 %     1.0 %     51,370       14.1 %     1.0 %     50,346       2.1 %     0.7 %
BCRA and other financial institutions     3,569       70.0 %     5.4 %     3,159       -16.1 %     5.9 %     1,443       5.9 %     6.4 %     647       20.6 %     6.8 %     511       6.9 %     5.4 %
Subordinated bonds     28,095       73.9 %     7.8 %     31,038       -15.2 %     7.0 %     29,314       6.6 %     7.1 %     30,213       20.9 %     7.1 %     30,809       8.6 %     7.1 %
Total int.-bearing liabilities     138,185       66.8 %     3.4 %     100,690       -18.1 %     3.3 %     97,144       2.4 %     2.9 %     90,236       2.4 %     3.0 %     82,442       4.6 %     3.1 %
                                                                                                                         
Total non int.-bearing liabilities     32,532                       31,385                       31,258                       40,153                       39,213                  
                                                                                                                         
Total Average liabilities     170,717                       132,075                       128,402                       123,801                       121,655                  
                                                                                                                         
Assets Performance             1,456                       1,570                       1,548                       1,168                       992          
Liabilities Performance             1,198                       830                       712                       675                       650          
Net Interest Income             258                       740                       836                       493                       342          
Total interest-earning assets             166,009                       84,123                       86,406                       87,330                       74,117          
Net Interest Margin (NIM)             0.6 %                     3.5 %                     3.9 %                     2.3 %                     1.8 %        

 

In 3Q20 Banco Macro’s net fee income totaled Ps.5.3 billion, 5% or Ps.267 million higher than in 2Q20 and 2% or Ps.124 million lower than the same period of last year.

 

In the quarter, fee income totaled Ps.5.7 billion, 6% or Ps.340 million higher than in 2Q20. Fees charged on deposit accounts, Corporate Services fees and ATM transaction fees stand out; with an 8% and 20% and 15% increase respectively QoQ. On a yearly basis, fee income decreased 4% or Ps.209 million.

 

In the quarter, total fee expense increased 19% or Ps.73 million. On a yearly basis, fee expenses decreased 15% or Ps.85 million.

 

NET FEE INCOME   MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)     3Q19     4Q19     1Q20     2Q20     3Q20     QoQ       YoY  
Fees charged on deposit accounts     2,338       2,042       2,018       2,060       2,223       8 %     -5 %
Credit card fees     1,286       1,166       1,219       1,107       1,152       4 %     -10 %
Corporate services fees     709       686       611       460       551       20 %     -22 %
ATM transactions fees     326       498       459       445       512       15 %     57 %
Insurance fees     331       336       350       361       359       -1 %     8 %
Debit card fees     319       291       286       323       349       8 %     9 %
Financial agent fees (Provinces)     274       410       271       277       279       1 %     2 %
Credit related fees     248       197       172       226       131       -42 %     -47 %
Mutual funds & securities fees     72       79       96       109       151       39 %     110 %
AFIP & Collection services     32       72       27       17       20       18 %     -38 %
ANSES fees     12       14       13       13       11       -15 %     -8 %
Total fee income     5,947       5,791       5,522       5,398       5,738       6 %     -4 %
                                                         
Total fee expense     552       554       495       394       467       19 %     -15 %
                                                         
Net fee income     5,395       5,237       5,027       5,004       5,271       5 %     -2 %

 

In 3Q20 Net Income from financial assets and liabilities at fair value through profit or loss totaled a Ps.7.5 billion loss, higher than the Ps.2.1 billion loss posted in the previous quarter. This loss can be traced to a higher loss related to sale of financial assets at fair value as a consequence of the inflation adjustment applied to our Leliq holdings (higher inflation was observed during 3Q20) which was partially offset by a Ps.422 million increase in profit from government securities.

 

8 

 

 

    3Q20 Earnings Release

 

NET INCOME FROM FINANCIAL ASSETS AND LIABILITIES
AT FAIR VALUE THROUGH PROFIT OR LOSS 		  MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)     3Q19     4Q19     1Q20     2Q20     3Q20     QoQ       YoY  
Profit or loss from government securities     -535       2,498       1,508       2,170       2,592       19 %     -  
Profit or loss from private securities     189       337       257       111       273       146 %     44 %
Profit or loss from investment in derivative
financing instruments 		    1,062       292       41       20       2       -90 %     -100 %
Profit or loss from other financial assets     14       64       -7       12       -4       -       -  
Profit or loss from investment in equity instruments     -14       17       103       87       -107       -       664 %
Profit or loss from the sale of financial assets at fair value     -17,448       -3,523       -6,545       -4,563       -10,297       126 %     -41 %
Income from financial assets at fair value through profit or loss     -16,732       -315       -4,643       -2,163       -7,541       249 %     -55 %
                                                         
Profit or loss from derivative financing instruments     0       0       0       0       0       -       -  
Income from financial liabilities at fair value through profit or loss     0       0       0       0       0       -       -  
                                                         
NET INCOME FROM FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS     -16,732       -315       -4,643       -2,163       -7,541       249 %     -55 %

 

In the quarter Other Operating Income totaled Ps.1.2 billion, 3% or Ps.37 million higher than in 2Q20. On a yearly basis Other Operating Income decreased 22% or Ps.328.

 

OTHER OPERATING INCOME   MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)     3Q19     4Q19     1Q20     2Q20     3Q20     QoQ       YoY  
Credit and debit cards     63       55       28       18       28       56 %     -56 %
Lease of safe deposit boxes     132       141       152       178       194       9 %     47 %
Other service related fees     453       340       547       390       436       12 %     -4 %
Other adjustments and interest
from other receivables 		    234       233       229       184       188       2 %     -20 %
Initial recognition of loans     -12       45       0       19       -12       -       0 %
Sale of property, plant and equipment     0       0       0       0       6       -       -  
Others     640       333       291       356       342       -4 %     -47 %
Other Operating Income     1,201       1,147       1,247       1,158       1,064       -8 %     -11 %

 

In 3Q20 Banco Macro’s administrative expenses plus employee benefits totaled Ps.9.6 billion, 3% or Ps.299 million higher than the previous quarter, due to higher administrative expenses (9%). On a yearly basis administrative expenses plus employee benefits decreased 9% or Ps.904 million.

 

Employee benefits increased Ps.25 million QoQ (remunerations and social security contributions were 1% lower but were offset by higher compensation a bonuses and employee services which increased 11% and 49% respectively QoQ). On a yearly basis Employee benefits decreased 2% or Ps.151 million.

 

In 3Q20 administrative expenses increased 9% or Ps.274 million, due to higher other administrative expenses (38% or Ps.329 million) related to legal expenses which were partially offset by lower (14% or Ps.44 million) Directors and auditors fees.

 

In 3Q20, the efficiency ratio reached 45.9%, deteriorating from the 41.6% posted in 2Q20. In 3Q20 expenses (employee benefits + G&A expenses + depreciation and impairment of assets) increased 3%, while income (net interest income + net fee income + differences in quoted prices of gold and foreign currency + other operating income + net income from financial assets at fair value through profit or loss – (Turnover Tax + Insurance on deposits)) decreased 22% compared to 2Q20.

 

9 

 

 

    3Q20 Earnings Release

 

If we had excluded from the efficiency ratio calculation the inflation adjustment on our Leliqs holding (as per Central Bank rules shown under profit/loss from financial instruments at fair value through P&L), efficiency ratio would have been 34.7% in 3Q20 and 33.7% in 2Q20

 

PERSONNEL & ADMINISTRATIVE EXPENSES   MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)     3Q19     4Q19     1Q20     2Q20     3Q20     QoQ       YoY  
Employee benefits     6,350       6,339       5,361       6,174       6,199       0 %     -2 %
              Remunerations     4,536       4,601       3,951       4,667       4,617       -1 %     2 %
              Social Security Contributions     961       1,043       878       1,039       1,024       -1 %     7 %
              Compensation and bonuses     691       527       414       370       412       11 %     -40 %
              Employee services     162       168       118       98       146       49 %     -10 %
Administrative Expenses     4,153       4,190       3,034       3,126       3,400       9 %     -18 %
              Taxes     464       450       436       392       405       3 %     -13 %
              Maintenance, conservation fees     480       626       460       493       508       3 %     6 %
              Directors & statutory auditors fees     790       717       344       308       264       -14 %     -67 %
              Security services     363       364       333       323       310       -4 %     -15 %
              Electricity & Communications     348       366       353       352       341       -3 %     -2 %
              Other professional fees     313       323       208       194       205       6 %     -35 %
              Rental agreements     55       52       26       29       10       -66 %     -82 %
              Advertising & publicity     149       195       66       88       75       -15 %     -50 %
              Personnel allowances     62       59       38       23       25       9 %     -60 %
              Stationary & Office Supplies     39       25       22       20       21       5 %     -46 %
              Insurance     39       38       29       41       42       2 %     8 %
              Hired administrative services     3       0       1       0       2       -       -33 %
             Other     1,048       975       718       863       1,192       38 %     14 %
Total Administrative Expenses     10,503       10,529       8,395       9,300       9,599       3 %     -9 %
                                                         
Total Employees     8,843       8,768       8,732       8,706       8,651                  
Branches     462       463       463       463       463                  
Efficiency ratio     64.3 %     34.5 %     39.8 %     43.3 %     57.1 %                
                                                         
Accumulated efficiency ratio     60.3 %     50.7 %     39.8 %     41.6 %     45.9 %                

 

In 3Q20, Other Operating Expenses totaled Ps.4.6 billion, increasing 4% or Ps.175 million QoQ. Others and Other provision charges stand out with a 9% (Ps.132 million) increase and a 25% (Ps.52 million) increase respectively QoQ. On a yearly basis Other Operating Expenses decreased 51% or Ps.4.7 billion.

 

OTHER OPERATING EXPENSES   MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)     3Q19     4Q19     1Q20     2Q20     3Q20     QoQ       YoY  
Turnover Tax     3,034       3,325       2,773       2,506       2,493       -1 %     -18 %
Other provision charges     660       389       341       210       262       25 %     -60 %
Deposit Guarantee Fund Contributions     194       141       137       155       184       19 %     -5 %
Donations     52       170       123       24       0       -100 %     -100 %
Insurance claims     19       19       17       17       13       -24 %     -32 %
Initial loan recognition     0       0       3       -3       0       -       -  
Others     5,375       1,834       1,511       1,503       1,635       9 %     -70 %
Other Operating Expenses     9,334       5,879       4,905       4,412       4,587       4 %     -51 %

 

In 3Q20 the result from the net monetary position (excluding Leliqs) totaled a Ps.4.8 million gain, Ps.4.4 billion higher than the Ps.479 million gain posted in 2Q20. This result is explained by the breakdown of monetary assets and monetary liabilities and their behavior during the quarter; an increase in monetary assets (loans, and government securities) and a bigger increase in monetary liabilities (deposits), and higher inflation observed during the quarter (228 b.p. above 2Q20 level, up from 5.37% to 7.65%) generating a positive result. If we include the inflation adjustment on our Leliqs holdings (a Ps.8.3 billion loss) the total result from the monetary position (including Leliqs) would be a Ps.3.4 billion loss, lower than the Ps.3.8 billion loss posted in 2Q20. On a yearly basis result from net monetary position (exc. Leliqs) decreased 41% or Ps.3.4 billion.

 

10 

 

 

    3Q20 Earnings Release

 

In 3Q20 Banco Macro's effective income tax rate 34.2%, higher than the 28.9% effective tax rate of 2Q20.

 

RESULT FROM NET MONETARY POSITION     BANCO MACRO  
In MILLION $ (Measuring Unit Current at EOP)     1Q20     2Q20     3Q20
Result from Net Monetary Position (Consolidated)     335       479       4,836  
Change in Consumer Price Index     7.7995 %     5.3746 %     7.6549 %
                         
RECPPC MONETARY ASSETS & LIABILITIES (*)                        
Monetary Assets (MA)                        
Cash and deposits in banks     -8,281       -6,212       -8,093  
Government and private securities     -1,805       -1,221       -2,745  
Loans     -18,718       -13,048       -17,367  
Other financial assets     -871       -2,544       -5,479  
Other receivables     -629       -425       -636  
Investment in other companies                     -33  
Others     -43       -30          
Total RECPPC Monetary Assets     -30,346       -23,480       -34,353  
                         
Monetary Liabilities (ML)                        
Deposits     24,452       19,249       32,300  
Other financial liabilities     2,391       1,546       2,250  
Other liabilities     1,554       1,511       2,286  
Subordinated Corporte Bonds     2,205       1,586       2,272  
Others     10       11       18  
Provisions     135       93       126  
Total RECPPC Monetary Liabilities     30,747       23,995       39,252  
                         
Result from Net Monetary Position     401       516       4,899  
                         
RECPPC Leliqs     -6,389       -4,274       -8,327  
Result from Net Monetary Position (inc. Leliqs)     -5,988       -3,758       -3,428  
                         
RECPPC: Result from changes in purchasing power of currency                        
(*)Banco Macro, not consolidated                        

 

Financial Assets

 

Private sector financing

 

The volume of “core” financing to the private sector (including loans, financial trust and leasing portfolio) totaled Ps.232.2 billion, decreasing 2% or Ps.3.9 billion QoQ and 12% or Ps.31.9 billion YoY.

 

Within commercial loans, Others stand out with a 7% or Ps.2.8 billion increase QoQ (mostly due to loans extended to SMEs at a 24% interest rate, as part of the relief package given the Covid-19 pandemic); meanwhile Overdrafts decreased 22% or Ps.4.9 billion.

 

Within consumer lending credit card loans increased 8% or Ps.3.7 billion QoQ.

 

Within private sector financing, peso financing increased 2% or Ps.4.7million, while US dollar financing decreased 32% or USD 147 million.

 

As of 3Q20, Banco Macro´s market share over private sector loans was 7.6%.

 

11 

 

 

  3Q20 Earnings Release

 

FINANCING TO THE PRIVATE SECTOR   MACRO Consilidated     Change  
In MILLION $ (Measuring Unit Current at EOP)   3Q19     4Q19     1Q20     2Q20     3Q20     QoQ     YoY  
Overdrafts     38,433       45,416       36,483       22,040       17,189       -22 %     -55 %
Discounted documents     29,605       24,038       25,986       23,523       21,361       -9 %     -28 %
Mortgage loans     17,685       15,579       14,475       13,962       13,652       -2 %     -23 %
Pledged loans     6,159       4,900       4,223       3,971       3,618       -9 %     -41 %
Personal loans     76,781       67,978       65,341       62,186       60,610       -3 %     -21 %
Credit Card loans     45,233       51,553       50,239       48,941       52,618       8 %     16 %
Others     32,933       27,694       31,630       41,268       44,099       7 %     34 %
Interest     13,848       18,921       17,760       18,139       17,360       -4 %     25 %
Total loan portfolio     260,677       256,079       246,137       234,030       230,507       -2 %     -12 %
                                                         
Total loans in Pesos     186,975       210,117       201,850       203,155       208,098       2 %     11 %
                                                         
Total loans in USD     73,702       45,962       44,287       30,875       22,409       -27 %     -70 %
Financial trusts     1,873       2,369       1,874       901       364       -60 %     -81 %
Leasing     399       281       223       167       133       -20 %     -67 %
Others     1,151       1,052       1,087       1,048       1,243       19 %     8 %
Total other financing     3,423       3,702       3,184       2,116       1,740       -18 %     -49 %
                                                         
Total other financing in Pesos     2,050       2,441       2,090       1,029       798       -22 %     -61 %
                                                         
Total other financing in USD     1,373       1,261       1,094       1,087       942       -13 %     -31 %
                                                         
Total financing to the private sector     264,100       259,781       249,321       236,146       232,247       -2 %     -12 %
                                                         
EOP FX (Pesos per USD)     57.5583       59.8950       64.4697       70.4550       76.1750       8 %     32 %
                                                         
USD financing / Financing to the private sector     28 %     18 %     18 %     14 %     10 %                

 

Public Sector Assets

 

In 3Q20, the Bank’s public sector assets (excluding LELIQs) to total assets ratio was 17.7%, higher than the 9.3% registered in the previous quarter, and higher than the 4.8% posted in 3Q19.

 

In 3Q20, a 124% or Ps.69.5 billion increase in Government Securities stands out, also in the quarter Leliqs increased 11% or Ps.13 billion. Since 2Q20 the Bank decided to invest in CER adjustable bonds and Badlar bonds.

 

PUBLIC SECTOR ASSETS   MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)   3Q19     4Q19     1Q20     2Q20     3Q20     QoQ     YoY  
Leliqs     76,396       56,170       81,045       113,478       126,435       11 %     65 %
Other     26,430       26,073       23,883       55,962       125,441       124 %     375 %
Government securities     102,826       82,243       104,928       169,440       251,876       49 %     145 %
Provincial loans     464       7,717       4,585       6,809       3,889       -43 %     738 %
Loans     464       7,717       4,585       6,809       3,889       -43 %     738 %
Purchase of government bonds     150       139       137       140       139       -1 %     -8 %
Other receivables     150       139       137       140       139       -1 %     -8 %
                                                         
TOTAL PUBLIC SECTOR ASSETS     103,440       90,099       109,650       176,389       255,904       45 %     147 %
                                                         
TOTAL PUBLIC SECTOR ASSETS (net of LEBAC/NOBAC/LELIQ)     27,044       33,929       28,605       62,911       129,469       106 %     379 %
                                                         
TOTAL PUBLIC SECTOR ASSETS (net of LEBAC/NOBAC/LELIQ)/TOTAL ASSETS     4.8 %     6.3 %     5.0 %     9.3 %     17.7 %                

 

12 

 

 

  3Q20 Earnings Release

 

Funding

 

Deposits

 

Banco Macro’s deposit base totaled Ps.493 billion in 3Q20, increasing 13% or Ps.55.6 billion QoQ and 39% or Ps.138.6 billion increase YoY and representing 83% of the Bank’s total liabilities.

 

On a quarterly basis, both public and private sector deposits increased with a 64% or Ps.41.4 billion increase and a 4% or Ps.14.2 billion increase respectively.

 

The increase in private sector deposits was led by time deposits, which increased 17% or Ps.29.4 billion, while demand deposits decreased 6% or Ps.11.8 billion QoQ.

 

Within private sector deposits, peso deposits increased 6% or Ps.17.2 billion, while US dollar deposits decreased 11% or USD 124 million.

 

As of 3Q20, Banco Macro´s market share over private sector deposits was 6.6%.

 

DEPOSITS   MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)   3Q19     4Q19     1Q20     2Q20     3Q20     QoQ     YoY  
Public sector     27,799       21,474       30,980       64,237       105,636       64 %     280 %
                                                         
Financial sector     400       384       330       376       441       17 %     10 %
                                                         
Private sector     325,921       299,597       321,849       372,483       386,633       4 %     19 %
Checking accounts     47,979       49,067       60,901       76,862       71,707       -7 %     49 %
Savings accounts     105,464       110,950       108,280       114,390       107,751       -6 %     2 %
Time deposits     162,960       129,710       144,396       169,744       199,177       17 %     22 %
Other     9,518       9,870       8,272       11,487       7,998       -30 %     -16 %
Total     354,120       321,455       353,159       437,096       492,710       13 %     39 %
                                                         
Pesos     244,335       224,013       264,787       354,311       413,952       17 %     69 %
Foreign Currency (Pesos)     109,785       97,442       88,372       82,785       78,758       -5 %     -28 %
                                                         
EOP FX (Pesos per USD)     57.5583       59.8950       64.4697       70.4550       76.1750       8 %     32 %
Foreign Currency (USD)     1,907       1,627       1,371       1,175       1,034       -12 %     -46 %
                                                         
USD Deposits / Total Deposits     31 %     30 %     25 %     19 %     16 %                

 

Banco Macro’s transactional deposits represent approximately 44% of its total deposit base as of 3Q20. These accounts are low cost and are not sensitive to interest rate increases.

 

Other sources of funds

 

In 3Q20, the total amount of other sources of funds increased 3% or Ps.5.6 billion compared to 2Q20. On a yearly basis other sources of funds increased 3% or Ps.4.6 billion. In 2Q20 Shareholder’s Equity increased 4% or Ps.5.6; also in the quarter subordinated corporate bonds increased 2% or Ps.648 due to the argentine peso depreciation.

 

OTHER SOURCES OF FUNDS   MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)   3Q19     4Q19     1Q20     2Q20     3Q20     QoQ     YoY  
Central Bank of Argentina     42       33       18       20       19       -5 %     -55 %
Banks and international institutions     3,635       2,247       589       591       402       -32 %     -89 %
Financing received from Argentine financial institutions     891       465       372       540       266       -51 %     -70 %
Subordinated corporate bonds     32,415       29,730       30,182       30,846       31,530       2 %     -3 %
Corporate bonds     8,208       6,757       6,197       5,220       5,019       -4 %     -39 %
Shareholders' equity     121,326       128,229       135,073       128,325       133,922       4 %     10 %
Total other source of funds     166,517       167,461       172,431       165,542       171,158       3 %     3 %

 

13 

 

 

  3Q20 Earnings Release

 

Liquid Assets

 

In 3Q20, the Bank’s liquid assets amounted to Ps.429.9 billion, showing a 17% or Ps.63.8 billion increase QoQ, and a 79% or Ps.189.5 billion increase on a yearly basis.

 

In 3Q20, LELIQs own portfolio increased 11% or Ps.13 billion. Other government & private securities increased 124% or Ps.69.5 billion.

 

In 3Q20 Banco Macro’s liquid assets to total deposits ratio reached 87%.

 

LIQUID ASSETS   MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)   3Q19     4Q19     1Q20     2Q20     3Q20     QoQ     YoY  
Cash     131,988       123,121       139,896       111,850       112,934       1 %     -14 %
Guarantees for compensating chambers     9,703       9,097       9,868       12,146       10,929       -10 %     13 %
Call     205       122       681       0       150       -       -27 %
Leliq own portfolio     75,002       56,170       81,045       113,478       126,435       11 %     69 %
Net Repos     -2,961       104       465       72,635       53,971       -26 %     -  
Other government & private securities     26,430       26,073       23,883       55,962       125,441       124 %     375 %
Total     240,367       214,687       255,838       366,071       429,860       17 %     79 %
                                                         
Liquid assets to total deposits     68 %     67 %     72 %     84 %     87 %                

 

Solvency

 

Banco Macro continued showing high solvency levels in 3Q20 with an integrated capital (RPC) of Ps.152.6 billion over a total capital requirement of Ps.35.7 billion. Banco Macro’s excess capital in 3Q20 was 327% or Ps.116.9 billion. Since the beginning of 2020 and due to inflation adjustments Equity has increased significantly leading to higher solvency levels (shown under Ordinary Capital Level 1).

 

The regulatory capital ratio (as a percentage of risk-weighted assets- RWA) was 34.8% in 3Q20; TIER1 Ratio stood at 27.3%.

 

The Bank’s aim is to make the best use of this excess capital.

 

MINIMUM CAPITAL REQUIREMENT   MACRO Consolidated     Change  
In MILLION $   3Q19(¹)     4Q19(¹)     1Q20(²)     2Q20(²)     3Q20(²)     QoQ     YoY  
Credit risk requirement     19,343       21,404       23,808       24,046       23,972       0 %     24 %
Market risk requirement     778       591       694       1,122       1,172       5 %     51 %
Operational risk requirement     6,627       7,563       8,606       9,493       10,604       12 %     60 %
Total capital requirements     26,748       29,558       33,108       34,660       35,749       3 %     34 %
                                                         
Ordinary Capital Level 1 (COn1)     69,629       83,090       115,532       116,048       131,531       13 %     89 %
Deductible concepts Level 1 (COn1)     -7,807       -10,637       -12,442       -10,011       -11,768       18 %     51 %
Capital Level 2 (COn2)     24,972       26,113       26,427       30,427       32,854       8 %     32 %
Integrated capital - RPC (i)     86,793       98,566       129,517       136,464       152,618       12 %     76 %
                                                         
Excess capital     60,045       69,008       96,409       101,804       116,869       15 %     95 %
                                                         
Risk-weighted assets - RWA (ii)     327,312       361,678       405,179       424,501       438,129       3 %     34 %
                                                         
Regulatory Capital ratio [(i)/(ii)]     26.5 %     27.3 %     32.0 %     32.1 %     34.8 %                
                                                         
Ratio TIER 1 [Capital Level 1/RWA]     18.9 %     20.0 %     25.4 %     25.0 %     27.3 %                

 

RWA - (ii): Risk Weighted Assets, considering total capital requirements.

(¹) Figueres are not inflation adjusted. Expressed in Pesos current at end of each quarter

(²) Figures are inflaiton adjusted. Expressed in Pesos current at EOP

 

14 

 

 

  3Q20 Earnings Release

 

Asset Quality

 

In 3Q20, Banco Macro’s non-performing to total financing ratio (under Central Bank rules) reached a level of 1.14%, down from 1.52% in 2Q20, and down from the 1.9% posted in 3Q19.

 

Consumer portfolio non-performing loans improved 54b.p. (down to 0.96% from 1.5%) while Commercial portfolio non-performing loans were practically unchanged in 3Q20 (up to 1.55% from 1.54%).

 

Consumer portfolio non-performing loans ratio continues to be positively impacted by recent measures adopted by the Central Bank of Argentina in the current Covid19 pandemic context, particularly the 60 day grace period that was added to debtor classification before a loan is considered non performing and the possibility to refinance outstanding credit card balances.

 

The coverage ratio (measured as total allowances under Expected Credit Losses over Non Performing loans under Central Bank rules) improved to 302.94% in 3Q20. Write-offs over total loans totaled 0.25%.

 

The Bank is committed to continue working in this area to maintain excellent asset quality standards.

 

ASSET QUALITY   MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)   3Q19     4Q19     1Q20     2Q20     3Q20     QoQ     YoY  
Commercial portfolio     121,370       127,331       112,709       87,981       76,034       -14 %     -37 %
  Non-performing     566       1,700       1,535       1,359       1,180       -13 %     109 %
Consumer portfolio     159,267       155,881       153,059       169,322       173,701       3 %     9 %
  Non-performing     4,768       4,170       2,082       2,547       1,667       -35 %     -65 %
Total portfolio     280,637       283,212       265,768       257,302       249,735       -3 %     -11 %
  Non-performing     5,334       5,870       3,617       3,906       2,847       -27 %     -47 %
Commercial non-perfoming ratio     0.47 %     1.34 %     1.36 %     1.54 %     1.55 %                
Consumer non-perfoming ratio     2.99 %     2.68 %     1.36 %     1.50 %     0.96 %                
                                                         
Total non-performing/ Total portfolio     1.90 %     2.07 %     1.36 %     1.52 %     1.14 %                
                                                         
Total allowances     5,929       6,225       6,275       8,227       8,625       5 %     45 %
Coverage ratio w/allowances     111.15 %     106.05 %     173.49 %     210.62 %     302.94 %                
Write Offs     1,134       753       592       546       631       16 %     -44 %
Write Offs/ Total portfolio     0.40 %     0.27 %     0.22 %     0.21 %     0.25 %                

 

15 

 

 

    3Q20 Earnings Release

 

Expected Credit Losses (E.C.L) (I.F.R.S.9)

 

The Bank records an allowance for expected credit losses for all loans and other debt financial assets not held at fair value through profit or loss, together with loan commitments and financial guarantee contracts, in this section all referred to as ‘financial instruments’. Equity instruments are not subject to impairment under IFRS 9. The ECL allowance is based on the credit losses expected to arise over the life of the asset (the lifetime expected credit loss), unless there has been no significant increase in credit risk since origination, in which case, the allowance is based on the 12 months expected credit loss.(For further information please see our 2019 20-F)

 

The table below shows, under the E.C.L model, the allowances for credit losses with their respective classification in stages, and the impact the transition to I.F.R.S. 9 has on earnings.

 

Transition to I.F.R.S.9  (BOP Jan 1,2019)      
IN MILLION $ (Measuring Unit Current at end of 3Q20)        
Allowances under BCRA rules     7,827  
Re-measurement of financial inst.     -529  
ECL under I.F.R.S9 (Jan 2019)     7,298  
         
Expected Credit Losses (ECL) - 2020 Evolution        
         
ECL under I.F.R.S.9 EOP 4Q19     6,235  
12months ECL (Stage 1)     2,156  
Financial inst. with increased credit risk (Stage 2)     1,121  
Financial inst. considered credit impaired (Stage 3)     250  
Monetary result generated by allowances     -1,137  
ECL under I.F.R.S.9 EOP 3Q20     8,625  

 

16 

 

 

    3Q20 Earnings Release

 

CER Exposure and Foreign Currency Position

 

CER EXPOSURE   MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)     3Q19     4Q19     1Q20     2Q20     3Q20     QoQ       YoY  
CER adjustable ASSETS                                                        
                                                         
Government Securities     119       5,014       2,932       21,085       44,209       110 %     37050 %
                                                         
Loans (*)     17,641       17,780       17,858       17,669       17,257       -2 %     -2 %
Private sector loans     9,536       8,522       7,932       7,391       6,944       -6 %     -27 %
Mortgage loans (UVA adjusted)     8,105       9,258       9,923       10,275       10,309       0 %     27 %
Other loans     0       0       3       3       4       -       -  
Total CER adjustable assets     17,760       22,794       20,790       38,754       61,466       59 %     246 %
                                                         
CER adjustable LIABILITIES                                                        
Deposits (*)     272       503       662       2,409       955       -60 %     251 %
UVA Unemployment fund     497       681       702       651       694       7 %     40 %
Total CER adjustable liabilities     769       1,184       1,364       3,060       1,649       -46 %     114 %
NET CER EXPOSURE     16,991       21,610       19,426       35,694       59,817       68 %     252 %
                                                         
(*) Includes Loans &Time Deposits CER adjustable (UVAs)                                                        

 

FOREIGN CURRENCY POSITION   MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)     3Q19     4Q19     1Q20     2Q20     3Q20     QoQ       YoY  
Cash and deposits in Banks     76,000       86,770       77,790       86,103       92,351       7 %     22 %
Cash     13,315       13,350       5,094       4,686       7,718       65 %     -42 %
Central Bank of Argentina     26,958       41,658       35,325       37,318       58,221       56 %     116 %
Other financial institutions local and abroad     35,722       31,757       37,367       44,095       26,407       -40 %     -26 %
Others     5       5       4       4       5       25 %     0 %
Net Income from financial instruments at fair value through P&L     323       302       159       36       4       -89 %     -99 %
Derivatives     0                       0       0       -       -  
Other financial assets     5,145       4,602       4,612       4,417       4,569       3 %     -11 %
Loans and other financing     75,007       47,661       45,297       31,896       23,366       -27 %     -69 %
Other financial institutions     265       744       81       64       39       -39 %     -85 %
Non financial private sector & foreign residents     74,742       46,917       45,216       31,832       23,327       -27 %     -69 %
Other debt securities     2,032       1,058       4,216       4,609       4,529       -2 %     123 %
Guarantees received     2,341       3,537       2,371       2,306       1,576       -32 %     -33 %
Investment in equity instruments     12       13       6       7       7       0 %     -42 %
Investment in associates and joint ventures     0       1       0       0       0       -       -  
Total Assets     160,861       143,944       134,451       129,375       126,403       -2 %     -21 %
Deposits     109,785       97,442       88,372       82,785       78,758       -5 %     -28 %
Non financial public sector     3,725       4,880       3,544       3,636       2,536       -30 %     -32 %
Financial sector     300       281       279       290       393       36 %     31 %
Non financial private sector & foreign residents     105,760       92,281       84,549       78,859       75,829       -4 %     -28 %
Other liabilities from financial intermediation     6,759       6,418       6,586       5,866       5,688       -3 %     -16 %
Financing from the Central Bank and other fin. Inst     3,924       2,502       780       764       540       -29 %     -86 %
Subordinated corporate bonds     32,316       29,611       30,182       30,846       31,530       2 %     -2 %
Other non financial liabilities     82       30       36       64       56       -13 %     -32 %
Total Liabilities     152,866       136,003       125,956       120,325       116,572       -3 %     -24 %
NET FX POSITION (Pesos)     7,995       7,941       8,495       9,050       9,831       9 %     23 %
EOP FX (Pesos per USD)     57.5583       59.8950       64.4700       70.4550       76.1750       8 %     32 %
NET FX POSITION (USD)     139       133       132       128       129       0 %     -7 %

 

17 

 

 

    3Q20 Earnings Release

 

Relevant and Recent Events

 

· Interest Payment Class C Peso denominated Notes. In October 2020, the Bank paid quarterly interest on Class C Peso denominated notes in the amount of Ps.201,528,367.94.

 

· Interest Payment Class A Subordinated Notes. In November 2020, the Bank paid semiannual interest on Class A subordinated notes in the amount of USD 13,500,000.

 

· Interest Payment Class B Peso denominated Notes. In Novebmer 2020, the Bank paid semiannual interest on Class B Peso denominated notes in the amount of Ps.252,804,212.

 

· Special Shareholders Meeting- Complementary Dividend. The Special Shareholders’ Meeting held on October 21st, 2020 adopted the following resolutions: a) separate a portion of the optional reserve fund for future profit distributions equal to $3,791,721,509 to be applied to the payment of a cash dividend to supplement the Dividend (hereinafter referred to as the ”Supplementary Dividend”) pursuant to paragraph b) below; b) calculate the Supplementary Dividend by multiplying the dividend of $ 20 per share already approved by the General and Special Shareholders’ Meeting held on April 30th 2020, by the coefficient obtained after dividing the most recent Consumer Price Index (“CPI”) published by Instituto Nacional de Estadísticas y Censos (INDEC) and informed by such entity to the date on which Banco Central de la República Argentina issues its authorization for the payment of the Dividend and the Supplementary Dividend, by the CPI of the month of April 2020. The difference arising between the amount obtained after the above described calculation and the Dividend shall determine the amount of the Supplementary Dividend. The aggregate amount to be distributed as Supplementary Dividend may not exceed the amount of $3,791,721,509 separated from the optional reserve fund for future profit distributions. This amount will be deducted from Shareholders’ equity in 4Q20.

 

· Death of Mr. Jorge Horacio Brito- Chairman of the Board of Banco Macro. On November 23rd, 2020 Banco Macro informed the death of the Chairman of our Board, Mr. Jorge Horacio Brito. Pursuant to article 17 of the Bylaws, the office of the Chairman shall be covered by the Vice Chairman, Dr. Delfín J. Ezequiel Carballo. At the first Board meeting to be held, the appointment of a new Vice Chairman and the election, from among the Alternate Directors appointed by the General Shareholder Meeting, of the one who will assume in order to complete the number of regular directors will be discussed.

  

· Covid-19: In early March 2020, the World Health Organization recognized Coronavirus (Covid-19) as a pandemic that is severely affecting almost all countries around the world. The spread of this disease globally has forced the authorities to take drastic health and financial measures to contain and mitigate its effects on health and economic activity. Particularly in the Argentine Republic, on March 19, 2020, through Decree No. 297/2020, the Government established the “social, preventive and compulsory isolation” measure until March 31, 2020, which was then extended until June 7, 2020. Along with health protection rules, tax and financial measures were taken to mitigate the impact on the economy associated with the pandemic, including public direct financial assistance measures for part of the population, the establishment of financial and fiscal facilities for both individuals and companies. As regards measures related to the Entity’s business, the BCRA established maturities extensions, froze the mortgage loan installments and encouraged banks to lend to companies at reduced rates. In addition, the distribution of dividends of the finance institutions was suspended until June 30, 2020. In addition, in the mandatory quarantine context, the BCRA ruled that financial institutions would not be able to open their branches for public service during that period and should continue to provide services to users remotely. They could also trade with each other and their clients in the exchange market remotely. During quarantine, remote trading of stock exchanges and capital markets authorized by the CNV, the custodians and capital market agents registered with the CNV was admitted. In view of the extension of mandatory quarantine, the BCRA then decided that financial institutions would open their branches from Friday, April 3, 2020 for public attention through previous appointments obtained by the Bank’s website. The Bank is developing its activities under the conditions detailed above, giving priority to the compliance of social isolation measures by its employees, with the primary objective of taking care of the public health and well-being of all its stakeholders (employees, suppliers, customers, among others). To this end, it has put in place contingency procedures and has enabled its staff to carry out their tasks remotely. From a commercial point of view, it has emphasized maintaining a close relationship with its customers, trying to respond to their needs at this difficult time, sustaining all virtual channels of care to ensure operability and good response to requirements, monitoring compliance with their business obligations and monitoring the active portfolio in order to detect possible delays in collection and set new conditions for them. Considering the size of the abovementioned situation, the Bank’s Management estimates that this situation could have an impact on its operations and the financial situation and the results of the Bank, which are under analysis, and will ultimately, depend on the extent an duration of the health emergency and the success of the measures taken.

 

18 

 

 

    3Q20 Earnings Release

Regulatory Changes

 

· Net Foreign Currency Position. In September 2020, through Communication “A” 7101 the Central Bank of Argentina established that that export pre-financings for which its foreign currency funding is matched by liabilities linked to the evolution of such currency (for the same amount), can be deducted from the calculation of the cash position within the Net foreign currency position USD-linked liabilities that exceed that position are not to be considered in such deduction.

 

· USD savings account opening. In September through Communication “A” 7105 the BCRA established that prior to the opening of a USD currency savings account; financial institutions must gather evidence that the client has an income or assets consistent with foreign currency savings, and should not be a beneficiary of any social plan or program.

 

· Foreign currency purchase restrictions. In September 2020 through Communication “A” 7106, the Central Bank of Argentina established debit and credit card consumption abroad with debit on local accounts in pesos, and foreign currency purchased by individuals for the payment of obligations between residents, including payments of foreign currency consumptions through credit cards, will be deducted as of the following month, from the USD 200 cap. Those who are beneficiaries of credit relief programs related to the pandemic will not be able, until the total cancellation of credits or while the relief stands, to have access to the foreign exchange market or sell securities that settle in foreign currency, or transfer them to custodians abroad. For those with capital amortizations due between October 15, 2020 and March 31, 2021, related to financial debts abroad or public securities denominated in foreign currency, must present to the BCRA refinancing plan.

 

· COVID-19. In September 2020 through Communication “A” 7107 the BCRA extended until December 31, 2020, the regulation stating that financial institutions cannot charge fees for transactions done through ATMs (previously until June 30 and extended until September 30). It also extended the regulation that financial institutions cannot charge punitive interest over unpaid credits, and ratifies unpaid instalments deferral to maturity, considering accrual of a compensatory interest rate.

 

· LELIQ position. As of October 2, 2020 through Communication “A” 7122 the Central Bank of Argentina established that financial institutions must reduce in 20 percentage points their net excess position in LELIQ versus their monthly average of daily balances recorded in September 2020. To comply, they shall reduce the excess net position through the gradual maturity of the securities. Along this regulation but in line with it, the BCRA decided to increase the REPO rate from 19% t0 24%.

 

· Rates (Leliqs and Repo). The BCRA decided to increase to 27% the passive REPO BCRA rate (from 24% and previously 19%) and increase the LELIQ rate to 37%. It also determined that companies can access the foreign exchange market 30 days prior to financial debt maturities to cancel capital and interest payments. Corporates can also have access when the pre-cancellation is done within the frame of a securities exchange restructuring process.

 

· Time deposits minimum rate. In October 2020 through Communication “A” 7131 the Central Bank established that as of October 13, 2020, the minimum interest rates are for time deposits of up to Ps.1 million to 89.35% (previously 87%). Additionally, as of the same date, the coefficient that determines the fixed rate of pre-cancellation of UVA-linked time deposits (with early termination option) was increased to 0.7703.

 

· Minimum cash requirements. In October 2020 through Communication “A” 7132 the Central Bank of Argentina decided that for financings that are disbursed as of October 9, 2020, financial institutions will not be able to deduct from cash requirements financings granted to individuals or companies that (i) belong to activity sectors that are not eligible for the “Programa de Asistencia de Emergencia al Trabajo y la Producción” (ATP) social program benefits and/or (ii) have imported consumer goods after March 19, 2020, unless these were medical products and/or supplies.

 

19 

 

 

  3Q20 Earnings Release

 

· Rates (Leliq and Repo). The BCRA decided to increase the one-day passive REPO nominal annual rate from 27% to 30%, implying an increment of three percentage points, and offer 7-day REPOs at a nominal annual rate of 33%. In line with this, the LELIQ rate was established at 36%.

 

· Time deposits minimum rate. (Communication “A” 7139. 10/15/2020). The BCRA decided to increase, for time deposits granted as of October 16, 2020, the percentages applicable to the average rates of LELIQ used to set the minimum rates for time deposits of less than $1 million to 91.89% (previously 89.35%). For time deposits granted as of October 21, 2020, the increment goes up to 94.44% and the coefficient that determines the fixed rate of pre-cancellation of UVA-linked time deposits (with early termination option) was increased to 0.7917. This is equivalent to a 34% nominal annual rate for individuals with time deposits of less than $1 million and 32% for the rest.

 

· New credit lines. In October 2020 through Communication “A” 7140 the Central Bank of Argentina established that financial institutions shall grant, within the frame of the ATP social program created by the Decree N°332/2020- financing for a maximum limit equivalent to the amount resulting from the number of employees (F.931) multiplied by the minimum wage plus a 20%, to the SMEs in a list provided by the Federal Administration of Public Revenues (AFIP), and that will be able to rely on a warrant to be arranged by FOGAR, and as of November 1, 2020, can be deducted of reserve requirements (40%). Moreover, credit lines to SMEs are launched to (i) finance investment projects aimed for the purchase of capital assets and/or the construction of facilities necessary for the manufacturing of goods and/or services, at a 30% nominal annual rate; and (ii) for working capital and discounted instruments to SMEs at 35%. Financial institutions affected by this regulation must comprise under these financings, as of October 16, 2020 and until March 31, 2021, the equivalent to 7.5% of their non-financial private sector deposits in pesos (as a monthly average of daily balances of September 2020). For the financing of investment projects, this limit must be 30% of the 7.5% previously stated.

 

· Branch Closures. In October 2020, through Communication “A” 7147 the Central Bank established that financial institutions must require prior approval by the BCRA to proceed to the transfer or closure of branches until March 31, 2020.

 

· REPO rate. In October through Communciation “C” 88436 the Central Bank of Argentina increased the 1-day REPO rate from 30% to 31% and the 7-day REPO rate from 33% to 34.5%.

 

· Fee increases. In November 2020, through Communication “A” 7158 the BCRA established that until February 28, 2020, financial institutions cannot communicate fee increases greater than 9% for January 2021, and 9% for February 2021 for fees on i) Savings accounts: additional debit card issuance; replacement of stolen or lost debit cards; ATM use (other than the Bank’s, the Bank network local or abroad) and cash withdrawal services at points of purchase. Ii) Credit cards: issuance services, renewal, maintenance; replacement or reprinting of stolen or lost cards and additional cards.

 

· Time deposits minimum rate. In November 2020, through Communication “A” 7160 the BCRA increased rates, for time deposits granted as of November 13, 2020, the percentages applicable to the average rates of LELIQ used to set the minimum rates for time deposits of less than $1 million to 102.78% (previously 94.44%). For the rest of time deposits this percentage will be 94.44% (prev. 88.89%). For time deposits granted as of November 18, 2020, for time deposits of less than $1 million, the applicable rate over LELIQ will be 97.37% (89.48% for the rest). The coefficient that determines the fixed rate of pre-cancellation of UVA-linked time deposits (with early termination option) granted as of November 13, 2020, was increased to0.8472 (from 0.7917). For the ones granted as of November 18, 2020, the coefficient will be 0.8026. Additionally, as of November 13, 2020, financial institutions that keep time deposits from the non-financial private sector in pesos below 10% of total deposits in pesos considering only capital balances without interests or adjustments will not be able to: (i) buy LELIQ for their excess position (ii) do 7-day REPOs with the BCRA.

 

· SMEs productive investment credit lines. Reserve requirements. (Communication “A” 7161.

 

· 12/11/2020). The BCRA states that as of November 1, 2020, it grants a reduction in the average reserve requirements in pesos for an amount of 14% of financings considered in item 4.1. of “SMEs productive investment credit line” regulation, granted at a nominal annual rate of up to 30%. As of November 13, 2020, financings to SMEs that have imported consumer goods after March 19, 2020, can be considered within this credit line.

 

· Rates (Leliq and Repo). In November 2020, through Communication “C” 88548 the Central Bank of Argentina increased the one-day passive REPO rate from 31% to 32% and the 7-day rate from 34.5% to 36.5% Additional to this regulation, the BCRA decided to increase the LELIQ rate from 37% to 38%.

 

20 

 

 

  3Q20 Earnings Release

 

QUARTERLY BALANCE SHEET   MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)   3Q19     4Q19     1Q20     2Q20     3Q20     QoQ     YoY  
ASSETS                                                        
Cash and deposits in Banks     131,988       123,121       139,896       111,850       112,934       1 %     -14 %
Cash     21,146       23,861       21,052       17,097       20,151       18 %     -5 %
Central Bank of Argentina     75,097       67,452       81,472       50,563       66,367       31 %     -12 %
Other local& foreign entities     35,740       31,803       37,368       44,185       26,411       -40 %     -26 %
Other     5       5       4       5       5       0 %     0 %
Debt securities at fair value through profit& loss     2,044       6,940       1,926       13,475       16,547       23 %     710 %
Derivatives     77       62       47       18       14       -22 %     -82 %
Repo Transactions     -       1,330       465       74,007       53,971       -27 %     -  
Other financial assets     7,590       7,538       13,833       12,071       15,568       29 %     105 %
Loans& other receivables     266,204       270,133       255,365       244,582       237,678       -3 %     -11 %
Non Financial Public Sector     646       7,888       4,769       6,984       4,009       -43 %     521 %
Financial Sector     3,331       4,833       3,149       2,353       1,786       -24 %     -46 %
Non Financial private sector and foreign     262,227       257,412       247,447       235,245       231,883       -1 %     -12 %
Other debt securities     104,640       78,948       110,358       160,578       240,248       50 %     130 %
Financial assets in guarantee     14,633       13,052       11,344       14,986       12,228       -18 %     -16 %
Investments in equity instruments     2,066       1,879       1,796       1,733       1,627       -6 %     -21 %
Investments in other companies
(subsidiaries and joint ventures) 		    185       179       191       161       182       13 %     -2 %
Property, plant and equipment     31,356       31,486       31,265       30,970       30,900       0 %     -1 %
Intangible assets     4,447       4,332       4,478       4,439       4,432       0 %     0 %
Deferred income tax assets     44       53       65       70       71       1 %     61 %
Other non financial assets     2,146       1,327       1,659       2,094       2,076       -1 %     -3 %
Non-current assets held for sale     1,718       2,141       2,211       2,196       2,247       2 %     31 %
TOTAL ASSETS     569,138       542,521       574,899       673,230       730,723       9 %     28 %
LIABILITIES                                                        
Deposits     354,120       321,455       353,159       437,096       492,710       13 %     39 %
Non Financial Public Sector     27,799       21,474       30,980       64,237       105,636       64 %     280 %
Financial Sector     400       384       330       376       441       17 %     10 %
Non Financial private sector and foreign     325,921       299,597       321,849       372,483       386,633       4 %     19 %
Derivatives     201       940       182       -       -       -       -100 %
Repo Transactions     2,961       1,226       -       1,372       -       -100 %     -100 %
Other financial liabilities     22,832       27,111       26,641       30,996       28,635       -8 %     25 %
Financing received from Central Bank and Other Financial Institutions     4,570       2,746       981       1,151       688       -40 %     -85 %
Issued Corporate Bonds     8,208       6,757       6,197       5,220       5,019       -4 %     -39 %
Current income tax liabilities     6,159       9,950       11,674       8,062       9,961       24 %     62 %
Subordinated corporate bonds     32,415       29,730       30,182       30,846       31,530       2 %     -3 %
Provisions     1,834       1,802       1,801       1,738       1,626       -6 %     -11 %
Deferred income tax liabilities     2,022       199       4       3,946       2,535       -36 %     25 %
Other non financial liabilities     12,488       12,375       9,003       24,477       24,095       -2 %     93 %
TOTAL LIABILITIES     447,810       414,291       439,824       544,904       596,799       10 %     33 %
                                                         
SHAREHOLDERS' EQUITY                                                        
Capital Stock     639       639       639       639       639       0 %     0 %
Issued Shares premium     12,428       12,430       12,430       12,430       12,430       0 %     0 %
Adjustment to Shareholders' Equity     43,863       43,864       43,864       43,864       43,864       0 %     0 %
Reserves     67,168       67,168       67,168       102,297       102,297       0 %     52 %
Retained earnings     -19,814       -19,814       3,968       -45,454       -45,454       0 %     129 %
Other accumulated comprehensive income     217       160       -1,021       -361       -840       133 %     -  
Net income for the period / fiscal year     16,825       23,782       8,025       14,910       20,986       41 %     25 %
Shareholders' Equity attributable to parent company     121,326       128,229       135,073       128,325       133,922       4 %     10 %
                                                         
Shareholders' Equity attributable to non controlling interest     2       1       2       1       2       100 %     0 %
TOTAL SHAREHOLDERS' EQUITY     121,328       128,230       135,075       128,326       133,924       4 %     10 %

 

21 

 

 

  3Q20 Earnings Release

 

INCOME STATEMENT   MACRO Consolidated     Change  
In MILLION $ (Measuring Unit Current at EOP)   3Q19     4Q19     1Q20     2Q20     3Q20     QoQ     YoY  
Interest Income     51,124       41,891       35,064       31,871       36,790       15 %     -28 %
Interest Expense     22,393       12,933       10,900       10,295       15,631       52 %     -30 %
Net Interest Income     28,731       28,958       24,164       21,576       21,159       -2 %     -26 %
Fee income     5,947       5,791       5,522       5,398       5,738       6 %     -4 %
Fee expense     552       554       495       394       467       19 %     -15 %
Net Fee Income     5,395       5,237       5,027       5,004       5,271       5 %     -2 %
Subtotal (Net Interest Income + Net Fee Income)     34,126       34,195       29,191       26,580       26,430       -1 %     -23 %
Net Income from financial instruments at Fair Value Through Profit& Loss     -16,732       -315       -4,643       -2,163       -7,541       249 %     -55 %
Result from assets at amortised cost     -       66       967       20       61       205 %     -  
Difference in quoted prices of gold
and foreign currency 		    2,138       1,670       604       846       1,207       43 %     -44 %
Other operating income     1,510       1,147       1,247       1,145       1,182       3 %     -22 %
Provision for loan losses     393       1,776       977       2,523       1,749       -31 %     345 %
Net Operating Income     20,649       34,987       26,389       23,905       19,590       -18 %     -5 %
Personnel expenses     6,350       6,339       5,361       6,174       6,199       0 %     -2 %
Administrative expenses     4,153       4,190       3,034       3,126       3,400       9 %     -18 %
Depreciation and impairment of assets     956       950       948       992       1,015       2 %     6 %
Other operating expense     9,334       5,879       4,905       4,412       4,587       4 %     -51 %
Operating Income     -144       17,629       12,141       9,201       4,389       -52 %     -  
Income from associates and joint ventures     24       32       23       9       15       67 %     -38 %
Result from net monetary position     8,185       -5,644       335       479       4,836       910 %     -41 %
Net Income before income tax on cont. operations     8,065       12,017       12,499       9,689       9,240       -5 %     15 %
Income tax on continuing operations     -1,047       5,061       4,474       2,804       3,164       13 %     -402 %
Net Income from continuing operations     9,112       6,956       8,025       6,885       6,076       -12 %     -33 %
                                                         
Net Income for the period     9,112       6,956       8,025       6,885       6,076       -12 %     -33 %
Net Income of the period attributable
to parent company 		    9,112       6,956       8,025       6,885       6,076       -12 %     -33 %
Net income of the period attributable
to non-controlling interests 		    -       -       -       -       -       -       -  
                                                         
Other Comprehensive Income     533       -57       -1,181       660       -478       -       -  
Foreign currency translation differences in
financial statements conversion 		    492       -172       -8       84       51       -39 %     -90 %
Profits or losses from financial assets measured at fair value through other comprehensive income (FVOCI)(IFRS 9(4.1.2)(a)     41       -       -       -1,173       -529       -       -  
                                                         
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD     9,645       6,899       6,844       7,545       5,598       10 %     145 %
Total Comprehensive Income attributable
to parent Company 		    9,645       6,899       6,844       7,545       5,598       10 %     145 %
Total Comprehensive Income attributable
to non-controlling interests 		    -       -       -       -       -       -       -  

 

22 

 

 

  3Q20 Earnings Release

 

QUARTERLY ANNUALIZED RATIOS   MACRO Consolidated  
    3Q19     4Q19     1Q20     2Q20     3Q20  
Profitability & performance                                        
Net interest margin     24.7 %     33.6 %     25.2 %     19.8 %     17.1 %
Net interest margin adjusted (exc. FX)     23.0 %     31.7 %     24.6 %     19.1 %     16.2 %
Net fee income ratio     20.6 %     8.8 %     14.3 %     14.7 %     20.3 %
Efficiency ratio     64.3 %     34.5 %     39.8 %     43.3 %     57.1 %
Net fee income as % of A&G Expenses     32.1 %     25.4 %     36.0 %     33.9 %     35.6 %
Return on average assets     6.3 %     5.2 %     5.9 %     4.5 %     3.5 %
Return on average equity     38.0 %     21.8 %     24.6 %     21.5 %     18.4 %
Liquidity                                        
Loans as a percentage of total deposits     75.2 %     84.0 %     72.3 %     56.0 %     48.2 %
Liquid assets as a percentage of total deposits     61.0 %     59.0 %     66.0 %     54.0 %     51.0 %
Capital                                        
Total equity as a percentage of total assets     21.3 %     23.6 %     23.5 %     19.1 %     18.3 %
Regulatory capital as % of APR     26.5 %     27.3 %     32.0 %     32.2 %     34.8 %
Asset Quality                                        
Allowances over total loans     2.2 %     2.4 %     2.5 %     3.1 %     3.6 %
Non-performing financing as a percentage of total financing     1.9 %     2.1 %     1.4 %     1.5 %     1.1 %
Coverage ratio w/allowances     111.2 %     106.1 %     173.5 %     210.7 %     302.9 %
Cost of Risk     0.6 %     2.6 %     1.6 %     4.1 %     3.0 %

 

ACCUMULATED ANNUALIZED RATIOS   MACRO Consolidated  
    3Q19     4Q19     1Q20     2Q20     3Q20  
Profitability & performance                                        
Net interest margin     21.5 %     23.9 %     25.2 %     22.3 %     20.3 %
Net interest margin adjusted (exc. FX)     20.8 %     23.0 %     24.6 %     21.6 %     19.5 %
Net fee income ratio     26.9 %     20.1 %     14.3 %     14.5 %     16.1 %
Efficiency ratio     60.3 %     50.7 %     39.8 %     41.6 %     45.9 %
Net fee income as % of A&G Expenses     44.6 %     39.7 %     36.0 %     34.9 %     35.1 %
Return on average assets     3.6 %     3.9 %     5.9 %     5.2 %     4.6 %
Return on average equity     18.4 %     19.3 %     24.6 %     23.0 %     21.5 %
Liquidity                                        
Loans as a percentage of total deposits     75.2 %     84.0 %     72.3 %     56.0 %     48.2 %
Liquid assets as a percentage of total deposits     61.0 %     59.0 %     66.0 %     54.0 %     51.0 %
Capital                                        
Total equity as a percentage of total assets     21.3 %     23.6 %     23.5 %     19.1 %     18.3 %
Regulatory capital as % of APR     26.5 %     27.3 %     32.0 %     32.2 %     34.8 %
Asset Quality                                        
Allowances over total loans     2.2 %     2.4 %     2.5 %     3.1 %     3.6 %
Non-performing financing as a percentage of total financing     1.9 %     2.1 %     1.4 %     1.5 %     1.1 %
Coverage ratio w/allowances     111.2 %     106.1 %     173.5 %     210.7 %     302.9 %
Cost of Risk     1.5 %     1.8 %     1.6 %     2.8 %     2.9 %

 

23 

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereto duly authorized.

 

Date: November 30, 2020

  MACRO BANK INC.
     
     
  By: /s/ Jorge Francisco Scarinci
  Name: Jorge Francisco Scarinci
  Title: Chief Financial Officer

 

 

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