Welcome to Davivienda's Q3 2021 earnings conference call. My name is Silvia, and I'll be your operator for today's call. Today's presentation is for investors and analysts only. Therefore, questions from the media will not be taken. Today, joining us from Bogotá, Colombia is Mr. Miguel Cortés, CEO of Grupo Bolívar, Mr. Efraín Forero Fonseca, Chief Executive Officer, Mr. Ricardo León Otero, Chief Risk Officer, and Mr. Javier Suárez, appointed CEO of Davivienda. During the call, they will be discussing the results per the press release distributed yesterday. If you have not yet received a copy of the earnings report, please visit the investor kit or the financial information section at ir.davivienda.com. At this time, all participants in a listen-only mode. Please note that this conference is being recorded. Afterwards, management will be available for question and answer session. Before proceeding, let me mention that any forward-looking statements are being made under the safe harbor provided by the Private Securities Litigation Reform Act of 1995. Actual performance could differ materially from the anticipated in any forward-looking statements as a result of macroeconomic conditions, market risk, and other factors beyond our control. It is now my pleasure to turn the call over to Mr. Miguel Cortés, CEO of Grupo Bolívar. Good morning to all of you. Thank you for joining us. My name is Miguel Cortés, and I want to start off the conversation this morning with a big thank you to our Chief Executive Officer of the bank, Efraín Forero, who has been with us 31 years leading the bank and 23 years in our group. Mr. Efraín has done an amazing job. I don't have words to thank him. He has taken our bank in Colombia from 2% market share in Colombia 31 years ago to be in the top 10 banks in Latin America in this 2020 report. He has been extremely successful in creating an amazing team of executives, and he's well-recognized for all his innovation and development of the banking industry. We are trying to thank you so much for everything you have done for the bank, for the countries where we're in, and for your leadership in the creation of the teams you have created. Javier Suárez, which will be our new CEO beginning January first, 2022, is an outstanding leader. He has been with us in the group for 29 years. In the past seven years, he has led our insurance companies through rapid innovation for Grupo Bolívar. He is also the Executive VP of the Grupo Bolívar, and he has been on the board, Davivienda board for the last 20 years. He has been helping Davivienda in many of the biggest challenges also for the last 20 years. He is well-known in the sector, and he is. has led the insurance association, as we call that, as president for a few years. He also is our head of risk of the whole group. The board of directors unanimously elected him to follow the huge steps that Efrain is gonna leave behind. Javier is an engineer from the University of the Andes in Colombia and has a master's degree in Actuarial and Finance from a well-known entity, University of Georgia in the United States. We wanna let you know all that, we are in good hands with Javier. We're very excited. We're very sad to let Efrain go. Efrain has chosen this path where he feels he wants to continue developing two personal things. He has asked to step aside. We are saddened by his thing or by his decision, but we wanna thank him immensely for his outstanding leadership throughout these 31 years of the bank. Efraín, good morning. Thank you, Miguel, for your kind words. Good morning, everyone, and thank you very much for joining us for our regular meeting. Today, I would like to comment on the main macroeconomic highlights, key financial trends, the progress in our digital transformation path, and some other recent updates on ESG. When looking at Colombia's economic evolution in brief, it is important to highlight the GDP growth, which reached 13.2% compared to September 2020, mainly driven by the commerce and manufacturing sectors. Confidence increased during the quarter, in line with higher vaccination figures and consumer demand, as shown by Davivienda's confidence index rebound. Regarding inflation, the rate closed the quarter at 4.5%, the highest level since 2017. With accommodation, public service, food and beverage prices showing upward pressures. Consequently, after 11 months of stability in the monetary policy rate at 1.75%, the central bank decided to take it to levels of 2% September and 2.5% in October. Additionally, after the approval of the new tax reform and the national budget for 2022, Moody's affirmed Colombia's sovereign rating at Baa2 and changed its outlook to stable. For the end of the year, we are expecting Colombia's GDP growth to reach 8.9%, inflation to close around 5%, and the monetary policy rate to increase to 3%. For 2022, the Colombian economic activity should moderate, with GDP growth closing at around 3.4%, the inflation rate decreasing to level of 3.7%, and a monetary policy rate of 4.5%. Moving on to Central America on slide four, we can see the main macroeconomic highlights of the region. The region continued to recover during the second quarter of the year, mainly due to higher external demand, vaccination campaigns, lower restrictions, and positive inflow in remittances, especially in Honduras and El Salvador. These factors positively impacted the manufacturing industry, commerce, transportation, and tourism, reflecting improvements in the different economies. In this sense, Panama, Honduras, and El Salvador showed annual increases over the 20% figures, while Costa Rica's growth was 7.9%. For 2021, we expect the GDP growth for the region between 8% and 9%. Despite inflationary pressure related with increase in international commodity prices, Costa Rica and El Salvador inflation rates remain in the central bank's target range. So far, Honduras and Costa Rica central banks have considered this upward pressure to be temporary. As a result, they have maintained historically low levels in monetary policy rates. Finally, Moody's downgraded El Salvador's sovereign credit rating from B3 to Caa1, due to the risk of successfully implementing the fiscal adjustment required by the country. Similarly, Standard & Poor's changed its outlook from stable to negative of Panama and El Salvador. Moving on to slide five, I will briefly talk about the main results of our business. Accumulated net profit reached COP 928 billion, around 2.4 times the accumulated by September last year, which led to a return on equity of 7.1% for the last 12-month period. These results are explained by lower financial and provision expenses, higher operating income, better economic activity, and recovery in confidence and demand. Our loan portfolio increased by 2.4% over the quarter, mainly driven by dynamics in the mortgage segment and the pickup in consumer disbursements. Our NIM, which included our hedging strategy for interest rate risk and FX movements, closed at 6.28%. Our cost of risk continued to decrease, closing at 3.22% due to updated macro expectations and better performance of our loan book. In terms of capitalization, our Common Equity Tier 1 ratio closed at 12.3%, well above the fully loaded requirement under Basel III. Moving on to other results, I'm glad to say that we continue to increase our market share in the countries where we operate. In this sense, we have increased around 70 basis points in Colombia and about 50 basis points in Central America in 10 months Dow Jones when compared to 2018. In this sense, we are focused on developing different ways to serve more people while providing sustainable financial services that help them to achieve their dreams. Of the 19.3 million customers that Davivienda reached by September, 88% were considered digital. In Colombia, we have the most complete digital portfolio in retail banking and continue to strengthen our digital offer to businesses. In Central America, we have been navigating the challenge that each country presents and have successfully launched digital products such as mobile loans, credit cards, and savings accounts, among other functionalities, to ease people's and businesses' experiences. In terms of recognition, Davivienda received the Google Cloud Customer Award during this quarter, which acknowledged the most innovative, technically advanced, and transformative cloud developments worldwide. This award demonstrates our ability to drive operational resilience, regulatory compliance, and better customer experience. DaviPlata also received the FELABAN Financial Innovation Award, reflecting its leadership in financial inclusion, its technological ability to develop innovative problem-solving initiatives while successfully managing risk and reaching meaningful goals. Going forward, we will continue placing our effort on the digital transformation path to face the challenge of the current competitive landscape. Finally, during the Q3, Davivienda acquired Promociones y Cobranzas Beta, a collection company that we started to consolidate with Davivienda's results, and is aligned with the bank's core business. This acquisition was made through Corporación Financiera Davivienda, our merchant bank, in a reorganization process with Grupo Bolívar. Please move to slide 6, where we present our regular update regarding the digital transformation journey in Colombia. Accumulated digital sales and monetary transactions through our digital channels increased their share compared to the last year, reaching 54% by September. As you can see in the upper right corner of the slide, physical channels continue to decrease their share in transactionality even with the reopening of the economy. This fact reflects that our customers are successfully adopting digital channels. Regarding our digital portfolio, digital deposits, loans, and investments showed significant increase on an annual basis and are becoming more relevant in Colombians' balance sheet. In this sense, 4% of Colombians' deposits are digital. Digital loans account for 14% of the retail banking portfolio and 27% of the consumer portfolio. Moving on to slide seven, I would like to elaborate on our native digital bank results for the quarter. DaviPlata reached 13.3 million customers by September this year, becoming the second-largest neobank in Latin America in terms of customers. DaviPlata's clients increased by around 600,000 during the quarter and about 2.3 million compared to a year ago. On average, we are incorporating around 190,000 new customers every month. Out of the total, 74% do not have additional products with Davivienda. This becomes an opportunity for the bank to deepen the relationship with some of these customers by offering them other types of products and services. DaviPlata's outstanding digital deposits remained relatively stable compared to the quarter and reached 1.3 times last year's figure. Accumulated transactional income reached COP 59 billion, which represent 1.2 times of the previous year figure. DaviPlata's e-commerce reached 1.7 million to the end of September, and around 60,000 entrepreneurs have enabled their social selling profile functionality. In this sense, DaviPlata continues its contribution to the country by increasing access to the financial service and offering tools to help small businesses grow. I believe DaviPlata will continue to reveal its great value and develop its ability to work with the different ecosystem, providing financial and non-financial services to more people in other countries. Please continue to slide 8, where we have some ESG highlights. On the environmental side, our green financing portfolio closed the quarter at COP 2.7 trillion, decreasing due to customer payment in Colombia, Costa Rica, and Panama. However, throughout the year, COP 6.3 trillion were evaluated with our environmental and social risk framework and were successfully disbursed, contributing to mitigating climate and social risks. We will continue working to fund projects aligned with the criteria while fostering new green business models that add value to our customers. Our social financing portfolio reached almost COP 8.1 trillion, where we continue our commitment to support social housing and new entrepreneurs. In this sense, we are actively participating in government programs and continue to be the first player in social housing in Colombia, with around 30% market share by loans. It is also important to mention that 52% of these homeowners are women. Additionally, Davivienda was ratified for the eighth time in a row as a member of the Dow Jones Sustainability Index. This recognition reflects the work we have been doing to strengthen our sustainability strategy, improve our human capital development, and the disclosure of green and social matters. We will continue to address global sustainability challenges while working to better incorporate the relevant issues for all our stakeholders into our strategy. Now, let me turn the call over to Mr. Ricardo León, our Executive Vice President of Risk, to continue with the presentation of the bank's financial results. Thank you, Efraín. Good morning, everyone. I'm glad to join you today. Please move on to slide number 9, where we analyze the assets evolution. Total assets closed around COP 145 trillion, increasing 3.5% over the quarter and 3.2% on an annual basis. Cash at the bank increased over the second quarter and over the year as a result of higher liquidity. Regarding investments, the increase over both periods reflect a higher level in the liquidity reserve to maintain its relative size in line with the balance sheet growth. Gross loans increased by 2.4% during the quarter and by 1.9% over the year, continuing to reflect recovery signs in Colombia and Central American economies. Overall loan loss reserve growth at COP 5.6 trillion, decreasing around 1.5% quarterly and 9.1% on an annual basis. This is explained by a better risk profile of our loan portfolio, as well as write-off made over the year. Colombia's and Central America's assets in dollars showed a quite similar behavior in terms of growth. As of September, Colombia accounted for close to 75% of the consolidated operation, and Central America for the remaining 25%. Move on to slide 10, please. In line with the economic trends observed during the quarter, gross loans increased by 2.4%, explained by dynamics of the different segments within the mortgage portfolio, in line with the trends observed in the housing sector in Colombia, supported by the subsidies program from the government, as well as an increase in the consumer portfolio as both confidence and demand have increased. In the international operation, the loan portfolio remained stable during the quarter. On an annual basis, the loan portfolio increased by 1.9% despite the 14% growth of the mortgage portfolio. Please remember that the commercial book is still impacted by a base effect mainly related to prepayments and write-off. However, it has grown 5.1% since December 2020. In Central America, gross loans increased by 4.5% year-on-year, mainly due to retail banking dynamics driven by El Salvador and U.S. Moving on to slide number 11, we present an update of reliefs and their behavior. Loans classified under some kind of relief or restructuring program continued to decrease during the quarter, closing at around 8% both in Colombia and Central America. When looking at the payment behavior of Colombia's relief loans, 85.4% of the portfolio is up to date, and the proportion of past due loans over 90 days is 6.5%. Regarding Central America, we see that around 90% of the relief portfolio is up to date, and past due loans over 90 days account for 3.5%. Although we have seen relief loans over 90 days past due slightly increasing, please take these two considerations into account. First, these numbers are already incorporated in our reported PDLs. Second, our provisioning effort has considered the potential recovery level of this portfolio. Please move on to slide 12, where we can see the evolution of past due loans, cost of risk, and loans by phase. As you can see on the top left table, total PDL over 90 days decreased 40 basis points over the quarter, mainly due to the consumer and mortgage portfolio. The commercial portfolio PDL increase is related to some deterioration in construction, commerce, and food sector. As for the consumer portfolio, past due loans show a decrease due to write offs during the quarter, higher portfolio growth, and better payment behavior. In the case of mortgage book, most of the recovery is explained by the portfolio growth and a better performance of recent vintage. At the bottom of the slide, you can observe our analyzed cost of risk for the key quarter closed at 2.26% and at 3.22% for the last 12 months. In this sense, provision expenses closed at COP 641 million for the quarter and reached almost COP 2.5 billion as of September. This result comes from updating our forward-looking parameters, reflecting better macroeconomic expectations for the rest of this year and for 2022. Regarding classification by stages, you can observe stage one slightly increasing over the quarter and year, while high-risk stage two and three decreased, accounting for less than 12% of the total portfolio. Coverage ratio remained at adequate levels, higher than the figures seen a year ago. Now, please move on to slide number 13. Funding sources grew 1.8% over the quarter and 2.5% on an annual basis. Demand deposits remain growing on a quarter and annual basis, increasing its share over the total funding. Meanwhile, term deposits continued to decrease and now account for 26% of funding sources. Bonds increased over the year due to the Additional Tier 1 issuance, COP 700 million senior bond issuance in Colombia, as well as issuances in El Salvador and Costa Rica. Credits increased over the quarter due to a lower balance of financial obligations in Colombia. During the last 12 months, our funding structure has slightly changed with demand deposit and bonds increasing its share, which allowed us to take advantage of the low interest rate period. I will invite you to slide 14, where you will see our capital structure. Our Common Equity Tier 1 closed at 12.29%, increasing by 25 basis points, mainly due to higher premiums. Our total capital adequacy ratio as of September closed at 18.46%, increasing 18 basis points over the quarter, in line with our expectations. This is explained by two effects, lower weight of our Tier 2 bonds issued in 2012, and a higher risk-weighted assets related to better improved performance in the consumer portfolio. However, as you can see, we have comfortable levels over the fully loaded requirement shown on the left side of the slide and remain among the best-capitalized banks in the region. Please move to slide 15, where we present our margins. When looking at the quarter behavior, we observe that the gross financial margin decreased by around 6.6%. This is explained by lower investment income related to upside movement in interest rates and a higher financial expenses explained by the bond issue during the year and FX behavior. As a result, the annualized mean for the quarter closed at 5.88%, which represents a 53 basis point decrease over the previous period. On accumulated figures, the gross financial margin contracted by 1.4% as a result of loan book repricing, mix changes, and higher competition, as well as lower income related to the investment portfolio devaluation, as has been observed in the general market. As a result, over twelve months, net interest margin ratio closed at 6.03%, remaining relatively stable over the quarter and increasing 20 basis points over the year. When taking into account the result of our hedging strategy, we see that the quarter's mean closed at 6.18% and the ratio for the last 12 months at 6.28%. As we saw before, operating expenses decreased 8.4% quarter-over-quarter and 17.9% on an accumulated basis. Net financial margin closed at COP 1.2 trillion for the third quarter and COP 3.1 trillion for the year. Please continue to slide 16. Operating expenses increased by 0.9% during the quarter. On an accumulated basis, OpEx increased by 6.8%, mainly due to a one-off payment to employees within the collective agreement framework, which is updated every three years. However, when excluding personnel and non-recurring expenses, OpEx would have increased by 5.6% on an accumulated basis. 12-month cost-to-income ratio closed at 46.6%, increasing over the quarter, but decreasing on a year basis. Please move on to slide 17 to analyze the bank's profits. Operating income increased 28.6% over the quarter and by 3% on accumulated figures, mainly explained by higher activity in the credit card business, income for the insurance business, and transactionality levels, as well as new income generated by Cobranzas Beta, a collection company recently acquired. Changes and derivatives income closed at COP 87 billion in the quarter and at COP 357 billion on an accumulated basis. Net profit for the quarter closed around COP 395 billion and reached COP 928 billion for the year, almost 2.4 times the accumulated as of September last year. As well, our return on average equity for the quarter reached 11.49% and 7.12% for the last 12 months. To finish the presentation, please move on to slide number 18, where we present our guidance. We continue to observe better macroeconomic trends in the countries where we operate. We are updating our expectation for the year and including what we could expect for 2022. For the year, we expect our consolidated loan book to grow between 7.5%-8.5%, mainly explained by the following behavior: 4.5%-5.5% growth in the commercial portfolio, higher growth in the consumer segment between 7%-8%, and increase between 14%-15% in mortgage growth. For 2022, we expect our consolidated loan book growth from 10%-11%. The 90-day PDL ratio should close the year around 3.7%-3.8%. For the next year, it should close between 3.3%-3.5%. Our net interest margin should end 2021 around 6% and should close between 6%-6.3% by the end of next year. We expect our cost of risk to close 2021 at around 2.7%-2.9% and at the levels between 2.4%-2.6% in 2022. Regarding operating income, it should end the year with an increase between 20%-25%, improving compared to pre-pandemic levels. For the next year, operating income should grow between 15%-15%. We're expecting an OpEx growth around 8% in 2021 and between 8%-9% in 2022. Finally, our return on average equity should close between 8.5%-9.5% for the year and between 11%-12% in 2022. Before finishing my presentation, I would like to thank Mr. Forero for all the support he has given us during these years. for the knowledge he has shared, but above all, for his great human quality and his closeness. His vision and leadership ability allow the bank to evolve and become a reference in digital transformation and one of the most important banks in Latin America. Thank you, Mr. Forero. Thank you for your attention. This time, we can move on to the question and answer session. Thank you. We'll now begin the question and answer session. We will first take the questions from the phone call, then we will read the webcast questions. If you have a question, please press star then one on your touch-tone phone. If you wish to be removed from the queue, please press the pound sign or the hash key. If you're using speakerphone, you may need to pick up the handset first before pressing the numbers. Once again, if you have a question, please press star then one on your touch-tone phone. For webcast participants, click the button with the question mark at the bottom of the webcast screen. Once again, it's star one for those on the phone. We have a question from Joshua Grassauer from Citigroup. Hi, everyone. Good morning, and thank you for taking my question. I'd like to understand, looking at the update to the 2021 guidance, in terms of overall growth metrics, we see that they are relatively unchanged, yet with higher expenses. What I want to understand is how is it that with higher expenses, we are able to, and potentially higher effective tax rate, how are we able to achieve a higher ROE? Thank you, Jose. Related to the guidance for the year, related to ROE, we are expecting an ROE between 11%-12%. In terms of net interest margin, we consider it's possible to improve the NIM. We estimate a NIM between 6%-6.3%. Related to the cost of risk, we are expecting that the cost of risk will improve. It will improve. It will be around 2.4%-2.6% for 2020. This year, we hope to finish the year with a cost of risk close to 2.7%-2.9%, and to be in a regular or pre-pandemic levels in 2023, with a cost of risk close to 2.2%. Sorry, just a quick follow-up, if I may. What would be like a normalized effective tax rate that we could expect going forward? Hi, this is David Pedraza. We should expect a normalized tax rate between 33%-34%. Thank you. Once again, if you have a question, please press star then one on your touch-tone phone. There appears to be no further questions at this time. I would like to turn the floor back over to Mr. Forero and Mr. Javier for any closing remarks. Well, thank you very much to everyone for being here today. This is my last time in this type of investor meeting that is really very, very important for Davivienda. I want to start thank you, every one of you, and thank you all the investor community. It's been very important support what we have had during these 31 years that I was, have been in Davivienda. Thank you, Miguel, for your words and for all your confidence with the work job that we are doing in Davivienda, with the very good team that you know we have in the bank. It's been really a privilege and an honor to be the CEO of Davivienda during these years. I am very glad to be now leaving the bank and having Davivienda in this, being one of the 20 largest banks and more representative bank in Latin America. It's been a bank that is been the, a pioneer in innovation, and we have now DaviPlata as well as different alliance like Rappi and, Dale!, that allow us to believe that we are ready and in the right track to see how the world, this financing world that is changing every day, is going to be and how Davivienda is going to be one of the main players as well in the region. It is really a privilege to have been in Davivienda. I want to thank Miguel and Jose Alejandro and all the shareholders and board of directors. As well, I need to have the chance to say thank you, Ricardo, for the words that you said in representation of the very important team that we have in Davivienda. Now, I want to share with you that I'm really very glad that Javier Suárez was selected by the board to be the next CEO of Davivienda. As you know, Javier, he's been a partner for me, and a very good friend of mine. He is a very talented man. He has been involved in most of our relevant transaction, M&A, that we have made so far, and as well as at the He was always with us in all the different meetings and all the different opportunities in the placement that we have made in the local and in the international operation that we have made. I know Javier is going to be a very fantastic CEO, and I wish you the best, Javier. Thank you, Efraín, for your very generous words. Thank you also, Miguel, for your also generous introductory words. For me, it's an honor to be appointed as the next CEO of Davivienda. I'm very grateful with the shareholders and the board of directors for this designation. I've been very close to the bank for the last 20 years, and I've been a privileged witness of how Efraín has led a team that has made Davivienda the institution that we all know today from a small saving and loans institution in the back in the early nineties to what it's today. It's a fantastic journey that Davivienda has gone through, always under the leadership of Efraín. Davivienda, as we all know, today it's a leading institution in the region and in digital transformation, digital offers to our customers that have been very well accepted. It's clearly a driving force in the changes that are happening in the market. I'm very excited to be part of the team again and be leading a team that has been carefully crafted for the last several years by Efraín. It's definitely the most important asset that the bank has is the management. Management is a tremendous team that has brought the bank to the place that it is now. I'm very happy to be part of the team again. With all the excitement, we'll be working very hard and making sure that the roadmap that Davivienda has been following for the last years, the roadmap that we'll keep pushing forward. We see exciting opportunities still ahead on the DaviPlata front, on the Rappi alliance, as well as the digital transformation of the bank. We see also opportunities for growth in Central America. We're very excited to be part of the team again. I want to also thank you, the investor community that has been part of Davivienda for many years and also ask for your support in the coming years as we'll try to move forward. Of course, you are a very important stakeholder in what we're planning to keep going with Davivienda. Thank you for being supportive for many years, and thank you for your continued support going forward. Once again, thank you, Efraín, for what has been a very remarkable career and there's a lot of admiration from all of us who have been around you. We want to wish you the best in your new endeavors. In the meantime, we'll keep working hard with the Davivienda. To all the investors that are with us today, we'll see you soon in our next call and following forward on the events that we'll have, attending our investors. Thank you also to our IR team, that it's a very good team, and we're very happy also to have the support of this team that will be with us also, going forward. Thank you very much and good day for all of you. Thank you, ladies and gentlemen. This concludes today's conference. Thank you for participating. You may now disconnect.