This call is for personnel results related to the second quarter of 2005. This conference call is being broadcast in Portuguese with simultaneous translation into English. To select your preferred language, click on interpretation on the application's menu. This audio and slides are being broadcast simultaneously on the internet and our website www.bancopan.com.br/ri and via Zoom. This event will also be available for download after its conclusion. We would like to inform everyone that this event is being recorded and all participants will be listed on the call given the company's presentation. Once the remarks are completed, there will be a special license session for participants when further instructions will be provided. For completing, we shall inform you that the statements that may be made during this conference call related to Banco Pan forward-looking perspective, projections, and operational goals are based on the beliefs and assumptions of management and on information currently available to the company. Future-looking statements are no guarantee of future performance. This involves risks, uncertainties, and assumptions because they relate to future events and therefore depend on circumstances that may or may not occur. Investors and analysts should understand that general economic conditions, industry conditions, and other operating factors could also affect the bank's future results and could cause these results to differ materially from those expressed in such forward-looking statements. With us here today, we have Mr. André Luiz Calabro, Banco Pan CEO, and Mr. Inácio Caminha, Head of Investor Relations. We will now give the floor to Mr. André Luiz Calabro, who will begin today's presentation. Please, Mr. Calabro, you may proceed. Hello. Good morning. Thank you again for being here with us in this conference call. I will get started here with the first highlights on the first page. We have four main ones that are going to guide our call today. The first item, number one, credit portfolio. We see that there was an origination recovery and full rotation of performing portfolio. I think the main highlight today guiding our call is the option of not assigning an on-day portfolio. This was an option we made this quarter because a long time this portfolio that was not assigned is going to give us more performance to the revenues related to the portfolio. Also, during time, the bank becomes more simple with the core more aligned. This decision is based also in the solid operational results that the bank shows. It is important that although credit assignment is a tool, it's an option today for Banco Pan. Delinquency? We have an instability in our portfolios with the clean portfolios. They are flat. We are going to give more details about this item. The margins are in robust levels in relation to the balance sheet portfolio. Regarding expenses, we have a reduction of our personal and admin expenses and costs. We've reduced in 20% this type of expenses. Admin and personal expenses was really around 7%. Next slide. Here we have some indicators about the bank. The number of customers is 32 million in the second quarter. Credit portfolio reached BRL 57.8 billion, an increase of 18% in relation to the second quarter of 2024, and 5% increase regarding the previous quarter. Net income, we had a reduction regarding the previous quarter, but basically, because of our assignment, we are going to explain it later. ROE, 11.3%. We did an exercise bringing the historic of results since 2021 to show some indicators. First, net income is very well aligned with the results of previous years. The good news here is that in the second quarter, here we don't have the effect of the assignment. This indicator here is really important. Our credit assignment, our credit portfolio has been growing. We are already in BRL 57.8 billion. ROE, 11.3%, is not comparable to the previous ones because of the assignment effect. If we had done the assignment, the ROE would be even superior to the first quarter of 2025. Lastly, we wanted to give you some details here about our efficiency strategy, also using artificial intelligence, bringing you here some front lines in which we are investing that are going to allow us to have more efficiency, performance gain, and speed. B2C origination had an increase of 32% over the last 12 months with the intensive use of data and GenAI for lead generation and conversion improvement. Credit and collections also used AI in our models to determine the behavioral influence, to assess collaterals, and the benefits amounted to a reduction of losses by 20%. All our interaction with customers, we've at 75% of self-service. We are here really focusing on reducing the costs of serving. This is a very important indicator. Our use of bots, AI, gives us a very high level of problem-solving. In the operations, we have more than 130 processes that are automated. This creates an excellence in operations, leverage, and reductions in the expenses. Now, Inácio is going to give you some indexes about our business with more detail. After that, we are going to have the Q&A session. Now, on slide seven, we are going to talk about engagement. Our total number of customers has decreased. Here we see a relation with the review in the amount of clusters, some specific clusters. We opted for closing the relationship with them. This is a daily issue, especially at this moment in which we see the macro deteriorating. We have to adjust our appetite and our growth speed accordingly. The cross-sell index, we have 2.3 products per active clients. The clients with the Pix keys also evolved. The transaction volume is 32.2. Even so, it increased even with the reduction of some clients. Now talking about origination in slide number eight, we have BRL 7.4 billion vehicles recovered to BRL 4.8 billion, and with a profitability that is good. Personal payroll loan, we have a good volume, relevant, totalizing BRL 1.1 billion. This number also we expect to be even stronger from third quarter on because we were at these initial phases of the product. We had that regulation of 120 days. Since the end of June, the volume of origination increased. We have good perspectives for this product, especially substituting the focus on the short term with the public and the INSS payroll loan that have very squeezed margins that are not that attractive. On INSS specifically, we have the entry of the marketplace now at the end of August. This is a way for us to maybe expand a little bit on the B2C. Certainly, we will not have the same levels that we had in the past for this product. FGTS-backed products are flat and personal loan also flat with BRL 300 million. Credit portfolio on slide number nine amounted to, so vehicles, of course, is the highest portfolio. Payroll, the public and the private one, cars and FGTS-backed products, also we had an increase, especially because of the personal origination. Another movement was the reduction of the clean portfolios, cards, or personal loan that decreased 3% in the quarter. We think this is an important growth, especially given the effect that we have seen of a retraction in the public payroll loan and INSS. On slide 10, we talk about delinquency. Our portfolio mix is very similar to the previous one. A slight decrease on payroll as a whole, vehicles increased 1%. Delinquency, 50 - 90 as expected, decreased, especially in vehicles. Over 90, there was this high to 8.3%. In vehicles, we have a portfolio that is stable, and we are comfortable with the dynamics that those products have been showing. They are live products, and we adapt according to the vintages and the quarters. On slide 11, we have information regarding the cards. Here again, we have a reduction in the issuance of cards that is aligned with everything that we've been talking about. We had a mix of clients. This impacts the TPV of this quarter. These are one-off adjustments that don't change the expectations for the increase of the clean portfolio that are important for our growth. Insurances, we rebounded. We are growing again in premiums and revenues. With this pickup of vehicles, we have a breakdown to show you according to the type of premiums. We can perceive here that life insurance and vehicle insurance have increased in the last year. They represent a little bit more, and this shows a diversification of the product. Now, let's talk about the financial highlights. Our interest margin has decreased from BRL 2.1 billion. This is because of two effects. The first one is that we didn't sell an all-day portfolio. Also, the fact that we have done again an NPL portfolio selling. We were understanding the effects of 4.966. We didn't sell this portfolio last quarter. This quarter, we began doing it again. Every time we have this NPL sale on balance, NPL portfolio, you have this reversion of the provisions on this portfolio that creates a benefit on the group of the credit cost. Looking at the two other graphics here in parallel, we see that the decrease in one of them is associated to the increase of credit cost. I mean, the improvement of credit cost to 6.8%. If we hadn't done this sale, the credit cost would be flat. At the end of the day, we always look to the NIM after credit cost that decreased to 7.4% because of not having an assignment, but also because of the slower speed on the clean portfolio. Now, let's talk about the expenses. As Calabro mentioned, we have done an important effort to improve our efficiency. Here, we've put the fourth quarter, I mean, the four previous quarters to show you how this presents. We come from expenses that were BRL 632 million, now in the second quarter of 2025. This movement is positive. On contingencies, we had a small increase because of the increase of the lawsuits, maybe related to the media on the topics that we have happening in this last half. The expenses with origination also are stable. We have benefits with the reduction of the payroll loan. Services revenues improved. When we look to the last line, we have BRL 191 million results with a ROE of 11.3%. As Calabro mentioned, this is a new way of a composition. It's different from the last quarters. We are very comfortable with this dynamic. To close, we have information regarding equity and capital. Base of rate is managerial because it's the conglomerate BTG. It's very comfortable. The base of rate, the equity is increasing. We are very comfortable to continue with our strategies. With that, we conclude our presentation and open for the Q&A session. Thank you. Now, we are going to begin with a Q&A session for investors and analysts. In case you wish to make a question, please raise your hand on the Zoom platform. Our first question comes from Pedro Leduc, Itaú. Pedro, you may proceed. Hello. Good morning. Thank you for taking my question. Congratulations for the private payroll loan. I would like to understand from you, how do you think you are gaining traction? It is another portal. Is it on origination? Is there any other channel? What is giving you this bigger appetite than other banks? Also, if you can give a scholar, what is PDD on portfolio that you are working with? Thank you. Hello, Pedro. Thank you for your question. I'm going to take some time to answer your question because I think it's worth it. Why do we have this traction in the private payroll loan? Since the beginning of the designing of the product, we've studied our product regarding the policy, the credit. We don't look only at the risk per client, but also in our modeling, we assess the risk of the company, so the corporate risk. With that, we have a modeling that is much more sound and more guaranteed to escalate the product. The second point that I would like to mention, when you talk about origination, today, 50% of our origination comes from our own channels. Since May, we are escalating these aligned to our strategy. Today, the client originates not only at the CTPS, but half of this origination is through our apps and channels. Regarding provision of expenses, and when we look at the indicators of writing and repassing, we had an indicator that was spread out in the media that was a little bit lower. I can guarantee you that our indicators are above this 84% or 86% that was divulgated because on the credit assignment, we have a much more adjusted process regarding the new credits. We had two very good surprises, the good index of re-employment. Those clients that didn't have their repass realized, we now have a very good process of re-employment. When the client changes jobs, we adjust this. In the process of recovering clients that maybe are unemployed and lost their jobs, we have this process to not only alerting them because we know that sometimes there is just a mismatch of communication between the corporate entity that didn't repass to us the money, but this is going very well. Because of this, as we commented in our release, we are already in the amount of BRL 1.5 billion, and we are going to continue growing because of this all that I have explained, but because of all the operations that we are going to begin in the future. Thank you. Thank you. Next question comes from Olavo Arthuzo, UBS. Good morning, André. Good morning, Inácio. Thanks for taking my question. I have two. The first one is about the credit assignment. We saw that this quarter it went to zero. It improves the quality of the result, but it also pressures the net income in the short term. I would like to understand the construction of the earnings along the second quarter. Can we understand that the bank is going to seize assignments in the next quarters, or should we work with something near zero as we saw in the first quarter? Just for us to understand what to expect in the second half of the year to understand, okay, the profit in 2025. The second question is, we saw that stage three, layer three, expanded in a very relevant way. The portfolio is above what we've expected and projected. Can you elaborate, please, where did this deterioration come from? I understand that you commented that the clean portfolios were responsible for this effect, but I would like to understand this vehicles portfolio in this regard. Was there a contribution in this stage three, or was it only because of the clean portfolio? Also, could you please give us some color on the evolution of the vintages, both a vehicles portfolio and the motorcycles portfolio? Thank you. Thank you, Olavo, for your question. About credit assignments, as I've mentioned, and with my arrival at the bank, we did a very good evaluation about the operational result of the bank. We are comfortable in not doing credit assignment. As I said, it is an option to us. It is a managerial tool, of course. The trend is that we don't do any more assignments, but again, this is an option. Why? Because we are looking at the results in the medium and long term. We are looking at the bank with the long-term vision. In terms of portfolio, we are going to have the benefit of accruing the revenues of these portfolios that are not assigned. In the long time, the bank becomes simpler, more focused on its core. Today, we have processes and systems that are focused on the management of these portfolios that are assigned. In line with our long-term strategy, we want to have each time more a closer relationship with our clients. Because of these items, we took this decision. We are very calm about this decision. We think this is going to be best for the bank. To avoid any misunderstandings, the portfolio assignment is an option, is a tool. This quarter, we opted for not doing it, and the trend is not to do it in the next quarters as well. Regarding the second question about stage three, stage three is indeed impacted by the clean portfolio. If you look to our strategies, we have been working on the portfolios to have more collaterals. Why did we reduce origination of clean portfolios? We have been observing delinquency in the market. We have been observing the macro scenario. To avoid a worsening a long time, we decided by the reduction of the clean portfolio, a review in the limits to have stability in this portfolio. On the other hand, now I'm going to mention the vehicles portfolio that you've mentioned. We have had good indicators by the strategy of recovery of credit assignment. In over 90, we have stability. The trend is positive. In 15 - 90, now I'm going to answer also your question about the vintages. In the last ones, two to three previous ones, they have had a better quality because of the improvements and reviews that we have done, review of our policy inclusive, and the good job that we are doing in the credit modeling, and also because of our sense that we are studying and redoing a long time. I hope to have answered your three questions. If you have anything else, please feel free to ask. Thank you again. Thank you. It was very clear, if you allow me a follow-up on this last topic to understand the evolution of the macro with the collaterals, could we think about the collaterals today, but looking from 2024 up to now, was there any effect? I want to understand if this is going to impact the quality of this vehicle's portfolio. According to our strategy, this type of portfolios have a low index of recovery. We work with the concept and strategy of a friendly delivery. We have begun with a new framework of collaterals. I assure you, the impact is almost zero because, let's say, the process is not yet 100% adjusted in the market. On the other hand, the impact regarding our recovery management in the legal area, let's say so, it's reduced. We are studying, okay, to understand if there is any benefit in escalating this managing tool a long time. Thank you, André. Now, we have Brian Flores with Citi. Hello. Good morning. Thank you for taking my question. I have a question about the margins and growth dynamics. You said that you are more cautious about the clean credit. I think this is reasonable because of the macro scenario. Should we think about a tighter and smaller margin as you advance in the private payroll loan? My question is if the trend of this margin should continue under pressure. I think this would help us to understand things better. Hi, Brian. Thank you for your question. Okay. I'm going to begin, and then Inácio is going to give you more color. We are more cautious in the clean portfolios. This is good. This is prudent at this moment in time. Of course, they help us with the robust margins, but we've preferred to do this realignment of a strategy because, as I mentioned in almost all my answers, we look to the bank not only today, but we want to have a consistent result in the medium and long term. Regarding the margins, excluding the assignments, we are going to keep in the same level. There is not going to, we are not going to have a drop, a fall. On the other hand, we are increasing the more resilient portfolios, the light, the motorcycles, the private payroll loans, and FGTS, and trying to pick up in the public and the INSS payroll loan. With the entrance of the marketplace, there might be a surprise. Everything is so new. We don't really know what is going to happen, but we are paying attention. We're going to be in the marketplace on the launching day. I think that there's no pressure regarding margins, even with the reduction of the clean portfolio. Inácio, I don't know if you would like to add something. Yeah, yeah. I think that's it. On the one hand, you take a little bit of the strength with the clean portfolio, but in vehicles, we have a good profitability. You renew the vintages. Also, we have the private, the personal, with a very good profitability helps. The reduction of the public and the INSS payroll also helps. The rebound of the INSS would be searching for higher profitabilities. I don't see any movements downwards, the margins, excluding the portfolio. Okay. Very clear. Just to follow up, I think the pace of the portfolio growth decreased a little bit. You began with 20%. Now it's 18%. The portfolio in the year as a whole will close around 15% or around 20%. How do you see this? What's your appetite in this portfolio? Brian? Year -over -year, the portfolio increases. If we look at the previous quarters, the difference is on the INSS and public payroll loans. Before, the origination was higher. We've reduced in the first quarter. In the second quarter, the reduction, if we didn't have the blockage, you know about the blockages that we had in May in the benefits of the renter people here in Brazil. This portfolio didn't pick up. The levels decrease. Again, answering your question, if we look at the difference, it is the origination of INSS because of these blockages in the retired benefits of INSS, but also, we are going to work in the private payroll loan because they have a more robust margin and the performance has been aligned with our expectation. Perfect. The pace, as I see, is going to be towards the 20%. Yeah, yeah. We expect a growth of this magnitude. Thank you. Now, we have a question by Antonio Huerta with Bank of America. Good morning. Thank you for your time. I have two questions. The first one is about the sale of the portfolio, the delinquent portfolio. Could you give us some more color about it? The cost of risk was stable in 2.8%. Is this so? What about the NII? What is the impact of this portfolio, the size of it? My second question is regarding the figures. Could you give us some figures in terms of target and synergy regarding OpEx? What can you still capture with the controller bank? Hello. Let's answer it. The NPL impact, remember, we have the on- and off-balance sale. It is around BRL 300 million that we've recognized as losses inside the margin group and also BRL 300 million as a benefit when we reverse the provision. This is in the credit group. You would have 8.8%, almost stable, the 8.8% from the first quarter. That would be very aligned with the numbers in the second quarter. This is the effect of the on-balance sales and off-balance sales also that contribute to the results. The revenue of WO recovery was BRL 92 million in the second quarter. Part of it is an ongoing process that we do internally of portfolio recovering. A small part, BRL 10 million, came from this specific transaction of the off-balance portfolio sale. This is the composition of the figures in this quarter in the different lines. Thank you for answering. If you want to ask a question, please raise your hand on the platform Zoom. Also, Antonio, we didn't answer your second question. We have done an effort regarding the efficiency of the bank. Now we have good indicators in the admin and personal expenses. Of course, this happens quarter after quarter. We are not yet being positively impacted by the technology implementations and the operational process in synergy with the BTG bank because they are structural processes that take long to be deployed. These benefits are going to happen in the long term, around 2027. Regardless, we have been doing a very good job, and the efficiency is improving. We have a reduction of BRL 50 million in this first quarter. Until the end of the year, we're going to have good news. The value to be captured is in the long term with the structuring technological processes. Thank you for your question and for your answer. If you want to ask a question, please raise your hand on the Zoom platform. Since we don't have any more questions, I would like to pass the floor to Mr. André Calabro for the final remarks. Thank you for your questions, for your participation in this conference call. We are available if you have any questions at the post-call. I hope that we were able to share with you not only the results of this quarter, but the strategies that we have been adopting in the long term. We are very confident that we are in the right way. Quarter after quarter, we are going to reap the fruits and the benefits of this strategy. Again, thank you. Have a good day, and we are at your available. This concludes Banco Pan 's conference call. We thank you for your attendance and wish you a nice day.