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Edited Transcript of BBDC4.SA earnings conference call or presentation 28-Apr-17 2:00pm GMT

Thomson Reuters StreetEvents

Q1 2017 Banco Bradesco SA Earnings Call

São Paulo May 3, 2017 (Thomson StreetEvents) -- Edited Transcript of Banco Bradesco SA earnings conference call or presentation Friday, April 28, 2017 at 2:00:00pm GMT

TEXT version of Transcript

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Corporate Participants

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* Alexandre da Silva Glüher

Banco Bradesco S.A. - CFO, EVP, IR Officer and Member of the Board of Executive Officers

* Carlos Wagner Firetti

Bradesco S.A. Corretora de Títulos e Valores Mobiliários, Research Division - Head of Equity Research

* Luiz Carlos Angelotti

Bradesco Leasing S.A. - Arrendamento Mercantil - MD

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Conference Call Participants

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* Domingos De Toledo Piza Falavina

JP Morgan Chase & Co, Research Division - Head of Latin America Financials

* Jorg Friedemann

Citigroup Inc, Research Division - Director

* Mario Lucio Pierry

BofA Merrill Lynch, Research Division - MD

* Olavo Arthuzo

Santander, Equity Research - Research Analyst

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Presentation

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Operator [1]

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Good morning, ladies and gentlemen, and thank you for waiting. We would like to welcome everyone to Banco Bradesco First Quarter 2017 Earnings Results Conference Call. This call is being broadcasted simultaneously through the Internet on the website, www.bradesco.com.br/ir. In that address, you can also find the presentation available for downloads. (Operator Instructions)

Before proceeding, let me mention that forward-looking statements are based on the beliefs and assumptions of Banco Bradesco management and known information currently available to the company. They involve risks, uncertainties and assumptions because they relate to future events, and therefore, depend on circumstances that may or may not occur in the future. Investors should understand that general economic conditions, industry conditions and other operating factors could also affect the future results of Banco Bradesco and could cause results to differ materially from those expressed in such forward-looking statements.

Now I will turn the conference over to Mr. Carlos Firetti, Market Relations Director. You may proceed.

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Carlos Wagner Firetti, Bradesco S.A. Corretora de Títulos e Valores Mobiliários, Research Division - Head of Equity Research [2]

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Good morning, everyone. Welcome to our conference call for discussing the first Q '17 results and also our strategy. We have today with us Mr. Alexandre Glüher, Executive Vice President and Investor Relations Officer; and Mr. Luiz Carlos Angelotti, Executive Director of Banco Bradesco.

I turn now the presentation to Alexandre Glüher.

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Alexandre da Silva Glüher, Banco Bradesco S.A. - CFO, EVP, IR Officer and Member of the Board of Executive Officers [3]

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Good morning, everyone. Thanks for joining our conference call today. We are discussing the main highlights of our results and later (inaudible) will bring you more details on the discussion.

Before entering into the discussion about the quarter, we would like to briefly talk about the Brazilian economy outlook, which we understand is currently experiencing an inflection point. There are clear signs that our economy is regaining momentum and have returned to growth in the first quarter. Our expectation is that the growth plan will continue to accelerate towards the second half of the year. Unemployment is reaching its peak and will probably start to reduce gradually later in the year. We are going through one of the most important and sustainable interest rate coming (inaudible) ever seen in Brazil, which should consolidate our economic recovery. We believe that we are close to concluding an important part of our reforms. In this context, we have a positive view for the future.

Now regarding our results, this quarter, we have already begun the reduction in our delinquency ratio as a consequence of our actions to improve credit quality and also due to the natural dynamic of our loan book. We haven't observed a recovery in our so far, mainly due to low credit demand. However, we have a relative improvement in credit origination for some (inaudible) in the individual segment. We believe the demand for loans will continue growing as the confidence rate in the economy builds up.

In Slide 3, we present the main highlights of our results. Net earnings in the first quarter were BRL 4.6 billion, a raise of 15% year-on-year with our ROE expanding to 18.3%. The main reasons for the improvement in our results were the reduction in loan loss provision expenses and our attractive cost control, which compared to the previous quarter presented a reduction of 12% and 7.7%, respectively. This improvement was partially offset by a drop in net interest income, which is still under pressure due to lower credit volumes. But the merits of loan growth is still complex. Our expanded loan book grew 8.5% in the last 12 months, but reduced 3.4% quarter-on-quarter, pressuring our net interest income, which reduced 5% in the quarter. We expect a better outlook for NII in the second half and the credit portfolio to grow again -- as the credit portfolio grows again. As we expect, the total NPL seems to have peaked in the fourth quarter and shows improvement in the first quarter. Loan adjusted by the NPL as a quarter -- of a quarter declined or degraded (inaudible) due to delinquency and the overall (inaudible) provision.

We've had, in the quarter, significant improvement in our NPL ratio for individuals and SMEs, with reduction of 28 and 36 percentage points, respectively. The NPL creation also presented improvement in individual (inaudible). We believe that this NPL ratio and NPL acquisition will keep improving through the coming quarters and later back to lower levels in 2018.

In this context, credit provision expenses dropped 12% quarter-on-quarter. We believe, at this moment, that our guidance for this line seems conservative, but we prefer not to change it for now.

We had a good evolution in cost control, with a reduction in expenses up 7.7% quarter-on-quarter and a drop of 3.8% year-on-year pro forma. This good performance is due to the rollout of our efficiency initiatives, as well as synergy related to the integration of our provision. We should fully capture the synergies until the end of 2018. Fees and commissions income were impacted by the difficult moment that the Brazilian economy is going through and reduced 1.5% quarter-on-quarter, although it's been increasing 16% year-on-year. We also had a good performance in the insurance business, which presented the 18.3% year-on-year growth increase. Our equity lending, which (inaudible) evolution growing 12% year-on-year.

Regarding our CapEx, we continue to expand it evidently. Our BIS Q tier 1 ratio remained (inaudible) at 12% despite increase in regular plan reductions from 50% to 80%.

On a fully loaded basis, our capital increased 8 bps in the quarter.

Now I turn the presentation to (inaudible), who will bring new moderate periods of our numbers.

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Luiz Carlos Angelotti, Bradesco Leasing S.A. - Arrendamento Mercantil - MD [4]

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Thank you, Alexandre. So going into more details in the presentation. We are on Slide 3, where we have the main adjustments in our net income to reach the adjusted net income. The main adjustments we made are the elimination as nonrecurrent of the goodwill amortization expense that amounted to BRL 554 million in the quarter. Only remind me, we expect to amortize BRL 2.4 billion in 2017.

In Slide 4, we have the main items of our P&L. Basically, net interest income presented a Q-on-Q drop of 0.3% this quarter. Focus is on the pro forma variations, minus 8.7% year-on-year. Basically, net NII was negatively impacted by NII from interests, especially the credit intermediation portion, and also, the impairment of assets. We have impairment of BRL 420 million this quarter. And we will go into more details on this later in the presentation.

The positive highlights of the quarter were the allowance for loan losses expenses, which dropped 12% in the quarter and 27.3% year-on-year pro forma. We had good performance in terms of operating expenses. We reduced them 1.5% year-on-year -- quarter-on-quarter. And we had a reduction of -- sorry, we had reduction of 7% in expenses quarter-on-quarter and reduced 2.8% year-on-year on a pro forma basis. Our fees in the quarter dropped 1.5 and grew 2.9 year-on-year. We also will go into more details in the guidance.

Our net income in the quarter grew 6%; and year-on-year, 13%. Our [active] expected expanded 4.1% in the quarter and 12% year-on-year.

With that, our return on equity reached 18.3%, expanding from 17.6% in the previous quarter, while our return on assets remained at that 1.4%.

On Slide 5, we have the breakdown of our earnings by segment. Insurance represented 30% of our earnings in the quarter; service revenues, 29%; and credit intermediation, 33%, basically due to the reduction in provision expenses. Our earnings per share increased to BRL 3.19 in the quarter.

On Slide 6, we have information about our NII. In the quarter, our total net interest income reached BRL 15.6 billion, almost flat q-on-q. This quarter, we had impairments of assets again, basically the impairments in our bond portfolio. As we said in the fourth quarter conference call, we started to do this impairment on a quarterly basis. We believe for full year '17, the total impairment should be slightly less than what we had in full year '16.

On Slide 7, we have the breakdown of our net interest income from interest. This line dropped 5% Q-on-Q and dropped 5.7% year-on-year on a pro forma basis. The main driver for this performance was the credit intermediation that dropped 7.7% year-on-year. The impact here is due to lower volumes that impacted negatively on the revenues. But also, specifically on the Q-on-Q comparison, also affecting the year-on-year comparison. We had the negative impact of a calendar effect. We had less business -- less total days in the quarter, so we accrued less revenue. And we had more business days, so we accrued more interest expenses. That resulted in a reduction in our NII from interest of about BRL 350 million in the quarter. It explains partially the effect in the credit intermediation revenues.

In insurance, basically, the margin was almost flat in the quarter and year-on-year. We have there the impact of lower interest rates, compensated by volumes.

In securities and others, we have the results of divestments of our -- of the bank's capital and also the asset revenue management. We had reductions Q-on-Q on this line of [0 9] and 4% -- 4.5% higher year-on-year. Here, we have the benefit of the reduction in interest rates in our assets and liability management. We have a fixed rate position against floating rate fund. But that gain was partially offset by other FX related to lower interest rates. We believe our -- we still can't meet our guidance for this line, that is a reduction of minus 4% to (inaudible). And we believe this will be helped by the recovering volumes we expect in the second half of the year.

On Slide 8, we have our net interest margins from credit. On a 12-months accumulated basis, it still increased 13.2%. Specifically, in the quarter, it reduced, mostly affected by the calendar effect I mentioned before. Considering the margins after provision, we have a bigger increase due to the reduction in provision expenses in the quarter.

On Slide 9, we have our loan book. Our loan book still dropped in the quarter, minus -- 2.4% reduction. We also had a reduction of 8.5% pro forma year-on-year. Basically, the company segment is still under pressure with the reduction in pro forma year-on-year of 12.9%. In the small companies, there is the fact that the company segment is still suffering more, while foreign DDoS year-on-year, we have a 1% growth.

In terms of portfolios, we are doing better in the middle. That was almost flat q-on-q with good performance, better performance in payroll loans that will -- 2.9% Q-on-Q. And mortgage, that grew 0.9. As I mentioned, the portfolio that is still more under pressure, mostly due to lower demand is the SME portfolio with a reduction of 5.9% Q-on-Q. Our guidance for loan growth is 1 to 5. We mentioned last quarter, we would be in the bottom of this guidance. We keep this guidance for now.

On Page 10, we have our mix in the loan book. Basically, as we have been mentioning, they have been migrating to lower risk. Now in the individual's portfolio, payroll loans and mortgage represents 22.2% of the total.

On Page 11, we have our credit quality data. We have very good yields on this front. This quarter marked the beginning of an improvement in credit quality indicators. We have the NPL for SME that was increased more sharply -- we did see in the quarter, despite the drop in the portfolio from 8.62% in 4Q to 8.26%. Also, foreign DDoS, we have a reduction from 6.94 to 6.66. We believe for this portfolio, we should continue to see improvements going forward. We think we probably reached the peak, and we can expect further improvements going forward.

In the corporate segment, as we mentioned, in the fourth quarter, we were hit by a corporate case. It was BRL 1 billion in defaults that were already hitting our 15 to 90 days NPL even in fourth quarter. With that, our top NPL for corporates increased. Adjusting for that, it would be also increased, but less. We have this corporate case with 100% provision since the end of 2015, so this case didn't impact our provision expenses. And we expect to write, and we will write off this company -- this case in the second quarter once we will make the total NPL to be closer to be in line with the adjusted one.

Total NPL adjusted for this case dropped 30 bps to 5.21. As I said, also for total NPL, we expect a positive trend going forward with the deterioration in credit quality reaching the peak in the fourth quarter.

So on Slide 12, also good news in the short-term delinquents. Improvement in the company segment where -- with a reduction to 299. It's still an increase in individuals but as you can see, there's a seasonal increase every first quarter. This year -- or this quarter, specific increase was lower than last year. The total 15 -- 90 days presented a reduction.

On Page 13, we have our NPL creation versus provision expenses. We adjusted for the corporate case I mentioned. We provide -- we made provisions for 105% of the creation. NPL creation -- total NPL creation dropped in the quarter and adjusted it dropped even more. Our provision expenses are presenting a downward trend, which is 5.09% in the first Q. We believe we can reach the bottom of this period probably at some point in the second half of 2018. Our guidance for provision expenses between BRL 21 billion and BRL 24 billion, as Alexandre mentioned, now seems conservative. But we prefer to, for now, keep it unchanged.

Page 14, we have more details in the NPL creation. You guys can see, we also had important improvements in the NPL creation for SMEs, individuals, less for corporates. But we believe we should continue and support this trend in the NPL creation going forward.

Page 16, we have our provisioning ratios. Our corporate ratio reached in the quarter, 182%. If we adjust for the corporate case we mentioned before, this ratio will be 106 -- 186%. So better than actually the current number, this coverage ratio should include in the second quarter as with the write-off of this partnering credit.

Our excess provisions were BRL 6.9 billion at the end of the first quarter. This quarter, we made the final provision for letters of credit and guarantees, following the dilution from the Central Bank reaching the end of '16 that regulates there. With that, we reallocated part of our additional provisions for this purpose. With this, we'll not reduce additional provisions anymore.

Page 16, we have our renegotiated portfolio. The renegotiations -- renegotiated loans increased this quarter, but less than previous quarter, reminding you that sites renegotiated loans after they become past due. We also include in this renegotiated portfolio with corporate credits that haven't already been written off, basically those credits that we recover with new loans.

The provisions for this renegotiated portfolio include 75.3%. This doesn't have any impact in results. It's only due to a change in the way we allocate among our credits, our additional provisions. We changed the way we do that this quarter, but it was more an internal change than any more specific impact.

On Page 17, we have our fees and commissions. Our fees grew pro forma year-on-year, 2.9%. We believe we should improve our performance in fees throughout the year as we start to see the maturity of some measures we have been taking to capture synergies from HSBC client base and also new initiatives in terms of segmentation in our own client base, and also the improvement in the economy we expect for especially this second half of the year.

On Page 18, we have a slide about our operating expenses. We have pretty good yields on that front. We had the reduction in the operating expenses of 7.7% Q-on-Q in the first quarter. Our expenses year-on-year pro forma are reducing 2.8% but is below our guidance. That will be minus 3% -- minus 1% and 3%. We had a pretty good performance in the administrative expenses. That is probably the line we are ahead in terms of capturing synergies from our Activision. We had a reduction of 7.1% year-on-year pro forma. And for personnel, we had an increase year-on-year pro forma of 1.9%.

Basically, the number of employees presented a reduction of 2% Q-on-Q, going to [106,600] people. We also had a reduction of 192 branches in the quarter due to the rationalization of our branch network, something that we always do. And we should continue doing that throughout the year.

On Slide 19, we have our efficiency ratio. We already had an improvement in the efficiency ratio in the quarter to 40.6% from 43.2% in the fourth quarter.

On Slide 20, we have our information about insurance. We had a very good performance in terms of the insurance premiums, which grew 12.8% year-on-year. The special highlight for life and pensions with an extension of 19.3%. Health presented an increase in premiums, up 10.6%. The net earnings of our insurance company remained at almost flat year-on-year, mostly impacted by higher claims especially, in the health insurance segment. The ROE reduced to 20.2%, however, this is mostly due to the increase in gains from market to market in the FX and also the fact that our insurance company didn't do the internal distribution of events this -- in the first quarter.

Finally, on Slide 21, we have our capital ratios. Our capital remained in a very strong position despite the increase in the deduction of strong capital that expanded from 60% to 80% this quarter in the [paving] process of BIS III. Fully loaded, our capital ratio reached 11.2%, considering this fully loaded our capital ratio increase in the bps in the quarter, mostly due to earnings retention, the reduction in risk-weighted assets and also consumption of tax credits. In the fully loaded included in the estimates of tax credit and amortization, we reached 12.4% in the quarter.

So this concludes the presentation. And now, we can open for the question-and-answer session.

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Questions and Answers

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Operator [1]

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(Operator Instructions) Our first question comes from Mr. Jorg Friedemann from Citi.

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Jorg Friedemann, Citigroup Inc, Research Division - Director [2]

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I have 2 questions. In the part of this call, you have mentioned that you believe that you should achieve the bottom of the guidance for net interest income. That implies, as you mentioned during this presentation, a drop on a pro forma basis year-over-year. The new regulations of credit cards to which banks cannot maintain clients for the revolving lines for after 30 days became effective on April 1. Would it be reasonable to assume that you can expand this more conservative guidance and that this pressure in that would already hit the numbers for the second quarter? And this is the first question. The second question, you mentioned also during this presentation, the strong performance on the operating expenses side. And you claimed that the good progression in the midst of your expenses was also related to the normal rationalization of branches. You closed 192 branches during this quarter. But I was looking into the historical figures. And with the reduction of branches in this quarter, actually, you have done more than you had originally done in each of the last 10 years. So is this really a normal rationalization? Is this related maybe to the HSBC integration? Or a digital strategy? I would like to have some more color if you could.

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Luiz Carlos Angelotti, Bradesco Leasing S.A. - Arrendamento Mercantil - MD [3]

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Thank you, Jorg. Regarding your first questions on the credit cards and the impact on margins, our guidance for NII already implied the impact of the new credit card regulation. Basically, we mentioned that probably, the tax will be around BRL 500 million pretax for full year '17. So we expect that the new regulation bringing a negative effect historically in the second half. But it is already considered in this guidance. The pressure in the NII, as we mentioned, this quarter specifically is related to this calendar effect, or it is helped by this calendar effect. But we have been suffering the impact from volume. I think this really is one of the main impacts we have in the NII. Regarding branches, you are right. We have been -- we have done more this quarter. Part of this reduction was the migration for points of service or (foreign language) in Portuguese. It is one, something we have been saying we would do. We have this performance that is basically smaller. It perfectly serves some regions. And we can replace some branches. It's low cost for this. But basically, we are really looking into details in our branch network. We always do this in an environment where we have all the trends on digitalization, et cetera. We may actually have room for changing habits, if they have room, if necessary, to do more adjustments like this.

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Jorg Friedemann, Citigroup Inc, Research Division - Director [4]

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Okay. Just a quick follow-up on that and I know, and thanks for that answer for that. You still have, I think, the biggest branch network in the country. You just integrated a very big bank with a strong capital also in the South and Midwest. So would it be reasonable to assume that ahead of this rationalization, you could continue doing additional closures during the coming quarters and capturing additional synergies with HSBC on top of it?

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Luiz Carlos Angelotti, Bradesco Leasing S.A. - Arrendamento Mercantil - MD [5]

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It's a fair comment. We haven't closed typically branches from our edition. Most of what we have done in this quarter is basically looking into Bradesco's own network. And we will -- we always do that. And you're right. Now, we have a bigger branch network. We have all these changes and these changes in terms of habits of banking customers. We have the new digital strategy, and we will be constantly looking into that. And also, whenever necessary and whenever it makes sense, switching from full branch to point of service, that really is a very good tool for continuing servicing our clients, having a presence at a lower cost fund.

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Operator [6]

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Our next question is coming from Olavo Arthuzo of Santander.

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Olavo Arthuzo, Santander, Equity Research - Research Analyst [7]

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I would like to talk about the asset quality of the bank. Your delinquencies accelerated in this quarter in the individual segment while in the others you excelled. And in looking at the previous years for the same period, this movement of this quarter has shown to be a little different. So could you please describe to us a little about the behavior of this based on the effects of unemployment to persist throughout the semester?

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Luiz Carlos Angelotti, Bradesco Leasing S.A. - Arrendamento Mercantil - MD [8]

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Thank you, Olavo, for your question. I'm not really sure what you mean about being different. We see this increase in the 15 to 90 days delinquents as smaller than last year. Basically, we also see, and we look to our internal data on (inaudible). The (inaudible) are doing well. It is still performing better than the current delinquents. So there's no -- nothing that we see different in the early delinquents. In fact, what I just mentioned on the behavior of the business, et cetera is what is behind our yield asset, but there's room for continuing improvement in delinquents.

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Olavo Arthuzo, Santander, Equity Research - Research Analyst [9]

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Okay. And you guys feel comfortable with the scenario of increasing employment rates to the -- during the semester?

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Luiz Carlos Angelotti, Bradesco Leasing S.A. - Arrendamento Mercantil - MD [10]

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We are comfortable. That -- this seems to be the trend for the rest of the year.

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Operator [11]

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Our next question is coming from Mario Pierry of Bank of America.

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Mario Lucio Pierry, BofA Merrill Lynch, Research Division - MD [12]

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Two questions as well. First one is related to asset quality. It's clear, right, looking at your presentation that you feel very comfortable with the asset quality, especially in the SME and individual segments. However, large corporates still seem to be lumpy. I would like to hear from you, what is your outlook for large corporates? Do you think we could still see other cases, significant cases throughout the year? Or do you think that the NPLs for large corporates should start to come down as well as the year progresses? Related to asset quality, right, if we -- in your lines of provision charges this quarter, we'll get to a number of BRL 19.4 billion below your guidance. I was just wondering why not change your guidance for provision charges? And then the final question is related to -- you made some statements in the beginning of the presentation saying that the economy is at an inflection point. You show that you are well capitalized. Just wondering, when does the risk appetite for lending return? What are you waiting for before you get more aggressive in lending? One of your competitors is already more aggressive in the market. I was just wondering what is it going to take for you to become -- to increase your appetite for lending again.

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Luiz Carlos Angelotti, Bradesco Leasing S.A. - Arrendamento Mercantil - MD [13]

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Mario, regarding large corporates, basically, we don't see other cases like this. This was kind of almost like a very special case in the sense that we already had full provisions for it since the end of '16. And for specific contract reasons, it only migrated to default in October and now to 90 days delinquent. We don't see things like this anymore. Basically, most of the credits we have for each bank, different positions in the sense of how they are positioned in the client and far from the (inaudible) of our -- each client. There are positions, guarantees, et cetera. So we, most likely, don't see a case like this repeating in the year. Regarding our guidance, you are right. Our guidance, as Alexandre mentioned, looks conservative. We not only don't revise our guidance before the middle of the year. And we think, it is conservative, but we prefer not -- really not changed. Let's see the evolution in the coming quarters. In terms of risk appetite, we haven't changed much our risk appetite. For sure, we have made some changes in the models. In some lines, we are requiring more collateral than in the past. But we were observing the past 2 days, our approval rates in many portfolios. And actually, we did not reduce much the approval rate. In some specific lines, we had slight improvements more recently. But looking historically, it was not really a big reduction in the approval rate. What we had is a reduction of the number of quotations, the reduction in demand. Clients are actually reducing their -- and it is lower confidence going -- and less credit. We believe that -- we know that we are already seeing the improvement in origination in some lines, especially for individuals. We think individuals probably is going to be the first one to have its demand improving even more. The portfolio's not -- actually, it's not dropping. It's still flattish and probably will return to growth. But the real improvement in growth will come as the economy improves, as the unemployment peaks, as the demand increase. We don't think there's much we can do just to really become more -- originate more from our side. We really need more and better demand.

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Mario Lucio Pierry, BofA Merrill Lynch, Research Division - MD [14]

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Okay, so it's clear, the problem then is more on the demand side rather than the supply. If we can go back to this specific large corporate without mentioning the names, can you just tell us in what segments of the economy it was related to?

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Luiz Carlos Angelotti, Bradesco Leasing S.A. - Arrendamento Mercantil - MD [15]

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Yes, we are not disclosing that. It is -- but as I said, it's a company that is already fully provisioned for a long time.

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Mario Lucio Pierry, BofA Merrill Lynch, Research Division - MD [16]

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Okay. And then you're right about in the second quarter?

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Luiz Carlos Angelotti, Bradesco Leasing S.A. - Arrendamento Mercantil - MD [17]

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Second quarter.

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Operator [18]

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Our next question is coming from Domingos Falavina of JPMorgan.

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Domingos De Toledo Piza Falavina, JP Morgan Chase & Co, Research Division - Head of Latin America Financials [19]

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Just on loan growth, I noticed sort of shrinking it a bit, I guess, the (inaudible) the previous question too, but loan loss provision is running low versus guidance. And it seems loan growth is also a little bit shy of the tracking for the year. So do you expect a bit more like rebounding in the second Q, third Q, just to get a sense on loan growth regionally?

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Luiz Carlos Angelotti, Bradesco Leasing S.A. - Arrendamento Mercantil - MD [20]

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Thank you, Domingos, for the question. As I said, we have seen already some increase in origination for the individual segment. And we believe that second half as the environment continues to improve it will be better. So we think growth can return in the second half. Our guidance, since the beginning, was to 1% to 5%, we sadly expected more to the bottom of the guidance, the 1%. So we think this (inaudible) or around it, it's still feasible.

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Operator [21]

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Excuse me, ladies and gentlemen, since there are no further questions, I would like to invite the speakers for the closing remarks.

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Alexandre da Silva Glüher, Banco Bradesco S.A. - CFO, EVP, IR Officer and Member of the Board of Executive Officers [22]

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We would like to thank you for the participation and questions. [Luiz] and I are available for additional questions as necessary whenever you want. Thank you and have a good day.

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Operator [23]

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That does conclude the Banco Bradesco's audio conference for today. Thank you very much for your participation. Have a good day.