• Net Income (4Q 2024): ARS64.7 billion, a decrease of 39.6% quarter-over-quarter.
• Quarterly ROE (4Q 2024): 9.5%.
• Quarterly ROA (4Q 2024): 1.7%.
• Net Income (2024): ARS357.7 billion, a decrease of 0.4% year-over-year.
• Annualized ROE (2024): 12.5%.
• Annualized ROA (2024): 2.5%.
• Net Interest Income (2024): ARS2.9 trillion, a decrease of 17.3% year-over-year.
• Total Operating Expenses (2024): ARS1.7 trillion, a decrease of 3.9% year-over-year.
• Efficiency Ratio (4Q 2024): 61.8%, up from 59.7% in 3Q 2024.
• Total NIM (2024): 35%, down from 37.3% in 2023.
• Private Sector Loans (4Q 2024): ARS7.6 trillion, an increase of 28.7% quarter-over-quarter and 75% year-over-year.
• Total Deposits (4Q 2024): ARS9.9 trillion, an increase of 7.8% quarter-over-quarter.
• Capital Ratio (4Q 2024): 19.5%.
• Market Share of Private Sector Loans (4Q 2024): 11.31%, up from 9.35% a year ago.
• Market Share of Private Deposits (4Q 2024): 8.72%.

• Warning! GuruFocus has detected 4 Warning Sign with BBAR.

Release Date: March 06, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Banco BBVA Argentina SA (NYSE:BBAR) reported a significant increase in new customer acquisition through digital channels, reaching 88% by the end of 2024, up from 78% a year ago.
• The bank's retail digital sales reached 91% in the fourth quarter of 2024, representing 73.5% of total sales in monetary value.
• Private sector loans increased by 75% year-over-year, with a notable 28.7% increase quarter-over-quarter, driven by growth in credit cards, discounted instruments, and customer loans.
• The bank's consolidated market share of private sector loans improved to 11.31% as of the fourth quarter of 2024, up from 9.35% a year ago.
• BBVA Argentina continues to show strong solvency indicators with a capital ratio of 19.5% and a capital excess over regulatory requirements of 138.5%.

Negative Points

• BBVA Argentina's inflation-adjusted net income in the fourth quarter of 2024 decreased by 39.6% quarter-over-quarter, with a quarterly ROE of 9.5% and a quarterly ROA of 1.7%.
• The bank experienced a 48.1% fall in quarterly operating results due to lower operating income and higher operating expenses.
• Net interest income fell by 17.3% year-over-year, impacted by lower accrued average rates in loans and lower inflation affecting CPI-linked bonds.
• The efficiency ratio increased to 61.8% in the fourth quarter of 2024, up from 59.7% in the third quarter, due to a decrease in both fee and interest income.
• The bank's total net interest margin (NIM) decreased to 35% in 2024 from 37.3% in 2023, reflecting a 234 basis points fall due to an aggressive decline in interest rates.

Q & A Highlights

Q: What are your expectations for growth in loans, deposits, and profitability for 2025? A: Belen Fourcade, Investor Relations Manager, stated that BBVA Argentina expects private loans to grow between 60% and 65% in real terms, compared to the system's growth of 40% to 45%. The bank is focusing on increasing market share. Inflation is expected to be around 30%, which is more conservative than the market consensus.

Q: What are your economic assumptions for 2025, including interest rates and exchange rates? A: Belen Fourcade mentioned that the monetary policy rate is expected to end 2025 at 24%, with an FX rate of around ARS1,300 as the official rate. GDP growth is projected at 5.5% for 2025.

Q: What are your expectations for profitability in terms of ROE or ROA for 2025 and beyond? A: Carmen Arroyo, Chief Financial Officer, indicated that BBVA Argentina expects mid-teens ROE, possibly a bit lower, around 12% to 13% for 2025. The bank anticipates maintaining mid-teens ROE through 2027, with potential for improvement.

Q: What is your capital plan for 2025, and do you plan to pay dividends? A: Carmen Arroyo stated that BBVA Argentina plans to pay a dividend in 2025 if allowed by regulations, but it will be lower than the ARS400 million paid in 2024. The exact payout percentage has not been defined yet.

Q: Can you address asset quality, loan losses, and reserves? A: Belen Fourcade noted that BBVA Argentina's non-performing loans (NPLs) are very low at 1.13%, below the system's average of 1.56%. The bank has increased loan loss allowances due to significant loan growth, but does not foresee major concerns with asset quality.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.