Good morning, and welcome to the Intercorp Financial Services Fourth Quarter 2025 Conference Call. [Operator Instructions] Please be advised that today's conference call is being recorded. [Operator Instructions] It is now my pleasure to turn the call over to Mr. Ivan Peill from InspIR Group. Sir, you may begin.

Thank you, and good morning, everyone. On today's call, Intercorp Financial Services will discuss its fourth quarter 2025 earnings. We are pleased to have with us Mr. Luis Felipe Castellanos, Chief Executive Officer, Intercorp Financial Services; Ms. Michela Casassa, Chief Financial Officer, Intercorp Financial Services; Mr. Carlos Tori, Chief Executive Officer, Interbank; Mr. Gonzalo Basadre, Chief Executive Officer, Interseguro; and Mr. Bruno Ferreccio, Chief Executive Officer, Inteligo. They will be discussing the results that were distributed by the company yesterday. There is also a webcast video presentation to accompany the discussion during this call. If you didn't receive a copy of the presentation or the earnings report, they are now available on the company's website, ifs.com.pe. Otherwise, if you need any assistance today, please call InspIR Group in New York on (646) 940-8843. I would like to remind you that today's call is for investors and analysts only. Therefore, questions from the media will not be taken. Please be advised that forward-looking statements made during this conference call, these do not account for future economic circumstances, industry conditions, the company's future performance or financial results. As such, statements made are based on several assumptions and factors that could change, causing actual results to materially differ from the current expectations. For a complete note on forward-looking statements, please refer to the earnings presentation and report issued yesterday. It is now my pleasure to turn the call over to Mr. Luis Felipe Castellanos, Chief Executive Officer of Intercorp Financial Services, for his opening remarks. Mr. Castellanos, please go ahead, sir. Luis Castellanos López-Torres: Good morning, and thank you all for joining our fourth quarter 2025 earnings call. Thank you for your interest in IFS. We appreciate your continued support. I'm going to start with the macro front. We continue to observe a…

Thank you, Luis Felipe. Good morning, everyone, and welcome to Intercorp Financial Services fourth quarter results. We would like to start with our key messages for the year. In 2025, we delivered a solid performance across all segments. Net income reached a record PEN 1.9 billion, marking a 49% increase compared to the prior year. Our return on equity was also strong, standing at 16.8%. Second, key message, higher-yielding loans continued the positive trend, showing an 8% growth on a year-over-year basis. Third, risk-adjusted NIM increased 50 basis points over the year, reaching 4% in the last quarter, while we maintained a low cost of risk at 2.1% and cost of funds near 3%. Fourth, we continue to strengthen primary banking relationships. And as a result, our retail primary banking customers grew 11% last year. Fifth, our insurance business continues to deliver solid double-digit growth with written premiums growing by 61% year-over-year, mainly due to the growth in private annuities. And sixth, our Wealth Management business delivered double-digit growth in our core business with assets under management at new record highs. Let's start with our first key message. Let me share an overview of the macroeconomic environment. The Central Bank has raised its GDP estimate for Peru in 2025 to 3.3%, driven by stronger-than-expected performance in primary sectors such as agriculture and mining, followed by primary manufacturing, construction and commerce. Looking ahead to 2026, Central Bank's projections have been revised upward to 3%, driven by stronger private spending. Macroeconomic fundamentals remain stable with inflation contained around 1.5% for 2025. The Peruvian sol has strengthened more than 10% this year, and the reference rate remains low at 4.25%, maintaining favorable financial conditions for ongoing growth. Overall, Peru is establishing itself as one of the fastest-growing economies in the region, supported by…

[Operator Instructions] And our first question will come from Ernesto Gabilondo with Bank of America. Ernesto María Gabilondo Márquez: Congrats on the results. My first question will be on Rutas de Lima. Just wondering if we should continue to see further impact in 2026? Or is this almost done? My second question will be on loan growth and asset quality. So as you said in the presentation and in your results, you have started to see more credit appetite towards credit cards and personal loans. So can you give us some color on what is the type of growth you're expecting for each segment? And how should that will be translated into asset quality, NPLs and cost of risk this year? Then I have a question on expenses. In 2025, you have like a high single-digit growth. You have been putting efforts in terms of technology, personnel, marketing. So how should we think about OpEx growth this year? And my last question is on your sustainable ROE. I believe in the past, your ROE used to be at the same level of Credicorp, which now is targeting to be around 20%. I believe you are targeting a midterm ROE of 18%. So just wondering if there is an opportunity to get your ROE more close to your peer at some point? Or is it something that you are not considering? And also, this 18%, you're expecting it to be achieved probably likely in 2028. Luis Castellanos López-Torres: Okay. Ernesto, thank you very much. And again, also apologies from our side for technical difficulties. We're looking into what happened. But going back to your question, Ernesto, thanks again. I'm going to go briefly like a summary, and then we'll pass it on to the team members so they can make more…

Yes. Hi, everybody. During our last call, we mentioned that after the closing of the tolls, we will do an additional charge on Rutas de Lima in the fourth quarter, and we reviewed and we think we have a very conservative value in what's left on the investment. It's around 20%. With the information we have now, we think that there doesn't -- there won't be any additional charges on that investment. Luis Castellanos López-Torres: Okay. That's good. Now Carlos, can you help us in a little bit more detail in terms of loan growth and asset quality as by Ernesto?

Yes. Thank you. Absolutely. Ernesto, thanks for your question. So regarding loan growth, particularly higher-yielding loan growth, which is credit cards and personal loans and SMEs, we have started growing that in '25, I would say, more on the second half of 2025. However, the market kind of -- it's been mixed because of the AFP. So a lot of the growth that we had was amortized by the clients towards November and December. That was an effect that kind of curtailed our growth. But we still grew in personal loans and credit cards around 2.3%, 2.5% on the last quarter. We expect that to continue and accelerate in 2026 based on the things that we're doing and our risk for appetite, but also on the fact that this is liquidity that Michela mentioned from the AFPs. What this will do -- it will probably increase cost of risk slightly, not because we want to increase cost of risk per se, obviously, but because it's a more efficient frontier in terms of profitability and risk. So we will probably go closer -- the last quarter was below 2% our cost of risk, and we will probably get closer to 2.5% or something around our historic environment. So I think that answers the -- I don't know, Ernesto, if you have any follow-up questions on that? Ernesto María Gabilondo Márquez: No, no. Yes, excellent. So cost of risk around 2.5% for this year. And in terms of loan growth, you were saying a more gradual increase for these high-yield loans? What about corporate loans? I believe maybe after the election, they can start to pick up. So just wondering how you're seeing that segment.

All right. Just to be clear, the cost of risk is not a target. It's probably -- it's a trend that will happen as you get higher-yielding loans. Corporate loans, as you know, we have good relationships with the main clients in Peru. We work closely with them in short-term and long-term. Corporate growth will depend on mainly 2 things: the amount of CapEx that goes on and probably there has been good CapEx in 2025. It will probably slow a little bit until we have more vision on the elections, but there's a lot of things coming in. And then bond offerings, right? As long as there's more bond offerings, the banks kind of shrink. So we foresee some growth just because the economy will grow and there will be investment, but it won't be necessarily our leading portfolio. Ernesto María Gabilondo Márquez: Perfect. Just a follow-up in terms of the ROE because the talking about the ROE, it was like stopped the audio. So if you can repeat again how you're seeing the evolution of the ROE? And do you think at some point, the 20% could be reasonable? Luis Castellanos López-Torres: Yes. Thank you, Ernesto. So again, the ROE, if you see the way we look at ROE, okay? And so Inteligo and Interseguro are already operating at ROEs north of 20%. The one that is growing and recovering is the bank, and that pace of recovery will depend on how fast we can rebuild more relevance of the consumer and higher yielding book, okay? So again, we do see an 18% plus ROE in the medium term as this book continues to evolve. And as we continue gaining efficiency at scale, the 20% plus is -- I think, is achievable as long as the Peruvian economy continues to perform well. So yes, we're not saying it's not achievable. However, in the medium term, we do need to see the higher-yielding book to recover. So the ROE of the bank with that improvement to be able to push towards north of 18% ROEs.

The next question will come from Daniele Morando with Santander.

Two very quick ones from my side. The first one is we noticed there was no formal guidance provided on NIM. Could you share some additional color on how you're thinking about NIM in 2026? And also, we continue to see volatility in the results of Interseguro and Inteligo. What is your medium-term profitability outlook for these businesses? And are there any specific initiatives underway to help mitigate this earnings volatility? Luis Castellanos López-Torres: Okay. Thank you. I'm going to start by your question #2. Again, our medium term and our structural profitability for both businesses is 20%. Obviously, especially Interseguro is like investment related. So whatever happens with the market will have an influence in the results. That's why you see a little bit more volatility. Same happens, especially with the prop book of Inteligo that we have a mixed strategy there. As you know, we do have a nice fee business growing in very stable, but then our book brings in some volatility. That is dependent on the evolution of the market in terms of investment results. But we do see 20% ROEs for those businesses year in, year out and going forward, and that's kind of the structural view that we have on it. In terms of NIM, again, I'm going to let Michela go over that answer. But as long as the higher-yielding book continues to get more relevance, NIM should continue to improve. So that's what we're expecting for next year, but maybe Michela can help us with a little bit more detail on that.

Yes. Just to add that as the higher-yielding loan portfolio grows, that should positively impact yield on loans. And we also expect an additional improvement of cost of funds, not as big as we have seen in 2025 because I guess a portion of that was also related to decreasing rates. But we still see potential for further decrease in cost of funds as we continue to improve the mix of the efficient funding with all the things that we are doing both in retail banking, but also with the payment ecosystem with Izipay and commercial banking. So NIM should slightly increase during 2026. We saw it already in the last quarter, 10 basis points. So we should see a further improvement in NIM and in risk-adjusted NIM throughout 2026.

The next question will come from Yuri Fernandes with JPMorgan.

For the quarter or for the year. I have a question regarding your deposits for you to deliver a high single-digit loan growth. How do you imagine your funding also growing, right? And this year, deposits, they are growing less, right? They're growing, I don't know, 5% above loans, but I think this is not enough for [indiscernible]. So just checking here, like in the past years, I guess there was a good improvement in funding cost, right, like more expensive institutional funding were growing more retail deposits. So basically, we're focusing in cheaper funding lines. And now the message from Michela from the past answer was that margins will expand on the asset side, right, on the mix -- so just checking the liabilities. Should we see maybe for you to deliver the funding growth you need a higher funding cost for you into 2026? And then just a follow-up on Ernesto, many questions just on the ROE. This was a part of 19% ROE, right? If you adjust for Rutas de Lima that hopefully, it's getting over given the amount of exposure you have. Why not more than 17% ROE for the next year? If insurance and the other business are running already at 20%, it's a better year. Why not a high ROE for the year? Luis Castellanos López-Torres: Okay. Thank you, Yuri, for your questions. Let me go over the last one again. Again, it will depend on -- if you see the bank is around to continue to recover, okay? The ROE of Interbank is the one that -- obviously, Inteligo had a soft ROE quarter, very strong year. But again, it will depend on the pace of recovery of the higher-yielding book of the bank. So more than 17% that is achievable, it is…

Thank you, Luis Felipe. And Yuri, yes, I mean, a little more detail on what Luis Felipe said. But as you can see, our loan to deposits is low. The fourth quarter was 92%. We've been growing deposits, but more than focusing on overall deposits, we've been focusing on low funding or low-cost deposits, and that has grown more this year than the last. And that, as Luis Felipe mentioned, comes from 2 -- in 2 ways. Retail deposits continued to grow well across the years, really, and 2025 was an exception, obviously, at the end of the year, helped by the pension fund, but we also get some of that in January and February. So we will continue getting that. And the other source of funding is the payments ecosystem. It's PLIN, it's -- the funds that come from Izipay to the accounts at the bank, I expect that to continue. So we will continue to grow low-cost funding. Maybe the overall size of deposits will continue to grow, but we're more focused on the mix. And that is what would help the cost of funding and NIM. So that's kind of the strategy.

The next question will come from Carlos Gomez with HSBC.

The first one is actually another way of asking the same thing everybody has asked you. We are obviously in an upswing for retail and for demand. And I guess my question is, to what extent do you think this is temporary because of releases from the pension funds or other factors? Or it's a permanent upswing? Essentially, how long do you think that the good times are going to last? You probably don't have an answer, but I would like to know what your best guess is. Second, referring to PLIN. I was trying to find some numbers, but I don't see them in the presentation. What would you say the market share of PLIN is today? And what is your market share within PLIN? Luis Castellanos López-Torres: Okay. We hope that good times last for many months or years going ahead. But Carlos, what we think is -- let's see, again, the pension fund releases and the severance deposit releases actually is stopper to loan growth, okay, because people use those funds, obviously, for some consumption of those activity, but also to repay debt or not get into more personal loans. So when that dries up, and we do expect that to happen starting the second quarter of this year, then probably we will going to see a more strong demand for personal loans in the portfolio and in the system as a whole. So it's a little bit cumbersome, but the releases of funds actually a little bit the growth profile of the portfolio, okay? Now we are seeing good macro numbers in Peru. The sentiment is positive. The confidence index are at high levels. The labor numbers are looking good. The consumption indexes are also stronger. So there's a structural improvement in Peru's macro front that…

Excellent. Yes. The reason we don't disclose market shares in PLIN and Yape is because there's no official source for market shares. We build an estimation based on what our competitors say in the market. So we kind of -- we believe PLIN currently has about 15% of the P2P and P2M market. So P2P is person to person and then also using PLIN to pay at a merchant. We believe PLIN is somewhere around 15%. And Interbank is a little bit over half of that. That's our estimation. I think it's well founded, but it's not -- there's no definite source on it. We do see growth above 40%, 50% per year. We continue to see very healthy growth in terms of users and in terms of transactions per user. So it's been growing, and it's contributing to our ecosystem. So yes, I don't know -- I think that's as much as I can share. I don't think I can share more, but that should give you a sense of where we're at.

Could you remind us -- I mean, there's not a official information, but as far as we know, there are 2 of you and you have your numbers. So as long as Yape gives theirs, you should have a full picture? Or are we missing somebody? Are we missing some other operator? And over time, is your -- is the market share of PLIN increasing or decreasing? How do you see this market evolving?

Okay. So yes, there are a few -- like there's other banks that are not part of PLIN or Yape. That's one, and they go through the CCE and we're all interconnected. So that's one part. It's a small part. It's main Yape and PLIN. What I don't get to see, and I only get to see on the reports is when Yape sends to another Yape user. We don't see that. We only see when Yape sends to PLIN and when PLIN sends to Yape. That's the reason we don't see the exact share. So there's a mix of the players that are not PLIN or Yape and then there's on us or on the transactions. And then in terms of share, yes, we are growing. It's still small. So we think there's a lot more potential to grow faster and to continue to grow. But yes, we're growing. Luis Castellanos López-Torres: Yes. And I think that something very, very positive is that we do see that our customers that use PLIN have much more activity with us, more principality, we become a principal bank. NPS is higher. And obviously, churn is smaller. So the numbers are adding up nicely in terms of building upon the strategy that the bank is deploying.

The next question will come from Alonso Arambur with BTG. Alonso Aramburú: I wanted to maybe double-click on the performance on consumer loans. Dynamics clearly are better than the last couple of quarters. But if you look at your market share, you've been losing market share, roughly 1 point in the last 12 months. So maybe you can comment on the competitive dynamics. What are you seeing? Who's gaining share? Is it related to payroll loans where you've seen negative growth over the past 12 months? And if you're seeing any change in this trend for 2026? Luis Castellanos López-Torres: Thank you, Alonso. Yes, I think payroll deductible loans to public sector employees, that's a market that for us, it's not growing that much. You have identified it well, and it obviously has an impact. And then I think that we've been digesting the -- what happened in '23 and '24. So we're coming back to market probably a little bit later than some of the competitors. But again, we've been in this business for many years. We know how the cyclicality can be. And we've been working in making sure that the equation adds up. And so we are returning with a little bit more of risk appetite. But obviously, we've been strengthening our underwriting standards and working through our models in order to make sure that we don't face any issues in the near-term or medium term. So that's probably adding all up, you'll see the results that we have seen, especially in the first half of the year. But as Carlos mentioned, we've seen acceleration in the third and especially in the fourth quarter in terms of velocity of growth. But I'm going to pass it to Carlos so he can complement a little bit more on that specific competitive dynamics that we're seeing. Carlos?

No, absolutely. I think there's 2 different -- so Convenio, not payroll loans have their own environment. We are the leaders there. We obviously -- it's a good market, but it grows slower than the rest of the market. Being the leader, we're looking at keeping the relationship with our clients, the economics, and that has a much different relations or performance compared to loans and credit cards. So where we stopped in 2023, '24 was loans and credit cards. And as Luis Felipe mentioned, we started to grow again and increase our risk appetite in 2025. We will continue to do that, but we want to do it in a very responsible way. As you know, in the consumer book, big spikes in growth never -- never become -- never end up well. So we've been doing it well. We've been growing. You would have seen a lot more growth if it wasn't for the AFP withdrawals. I think that's a little something that set us back a little bit in terms of growth, but not in terms of usage of our credit card, usage of our payment solutions. We continue to see growth and engagement there. So we're very positive that over the next couple of months, we will have growth and recuperate some market share. As we mentioned earlier, we're at the beginning of the cycle, and it's early, and we will -- we know how to do this. And we feel comfortable that the engagement and our value proposition is working well, and it's a matter of increasing the risk in the portfolio slightly, and you will see the growth. So that's kind of the way we're looking at it. The kind of the way Convenio's portfolio has a whole different environment, and that should be more stable. The other portfolio that's growing is SMEs and that's higher yielding as well. And that kind of at the end of the day, takes a little bit or brings in a little bit of the yield that is not growing with the payroll loans portfolio.

The next question will come from Damian Mora with CrediCorp Capital.

I have just one follow-up question. The normalized ROE in 2025 was close to 18.5%. So I'm wondering or I would -- just to clarify what is stopping IFS from reaching a similar figure and achieve an 18% ROE besides the Rutas de Lima, which we don't expect more additional impairment. What will be those factors that do you expect that will not repeat this year and that favor 2025 results? And thus, what will be the ROE expectations for each company in the 17% ROE scenario for this year? Luis Castellanos López-Torres: Thank you, Daniel. Yes, I'm going to go again. So it was a very strong year for some of our investments, especially Inteligo and also some investments we have at the holding company level, the disclosure is there. So that was very positive. And again, the more stable, sustainable higher ROE will have to come from the continued recovery of the bank, while the consumer and higher-yielding loans book recover. For instance, if you see the last Q ROE for Interbank itself was like around 16%. So that needs to continue into a more positive way. And that will come again as a result of higher-yielding loans building up in our portfolio, and that's a process that Carlos just explained. So that's what's holding us back a little bit in terms of how fast we can achieve that medium-term objective. So I hope that answers your question.

At this time, we will take webcast questions. I will now turn the call over to Mr. Ivan Peill from InspIR Group.

Thank you, operator. The first question comes from Shane Matthews of White Oak Investors. Congratulations on the results. As you increase the share of higher risk loans, do you expect to maintain the same level of coverage of 2025? Luis Castellanos López-Torres: Okay. Thanks for your question. I'm going to pass it on to Michela. I'm assuming, yes, the coverage comes in line with higher provisions due to the cost of risk improving because of those loans. But the mathematics in terms of coverage, Michela, maybe can help me.

No, no, yes, not much to add actually. Yes, as Carlos mentioned before, with increasing the high-yielding loan portfolio, we should see an increase in cost of risk. And the levels of coverage, which should remain very similar, not to the ones that you see in 2025.

The next question comes from Anand Bhavnani also of WhiteOak Investors. Given it is election year, what are the key risks that you would watch out for? Luis Castellanos López-Torres: Okay. And thanks very much for that question. I guess I'm going to put it in 2 fronts, okay? Yes, it's an election year. Again, we don't see big disruptions coming into the market. Again, our base case is of continued stability or growth, whatever. What we've seen in previous elections is some candidates that are not market friendly start to rise up in terms of the polls. And then people start losing confidence and investments start getting delayed. So that's kind of a risk that we see to growth in the coming months that something changes in terms of the political environment and some radical proposal or not market-friendly type of disruption becomes a risk in the political scenario. So that is the election period itself. And so people will delay and companies will delay some decisions because of this. And then the second front is what actually happens, who gets elected. And again, the risk is for someone that is not market-friendly being elected and trying to change certain things that support growth or stability, the currency being stable or issues that will come with inflation. So basically, that's the risk. It's a political risk of somebody changing the rules of the game. The probability is not high. But again, we are in Peru, and we've gone through some volatility because of this before. So that is kind of the way we see it. So we need to see what happens in elections and what happens in the actual candidate being elected as President. Now again, our base case is of continued stability, continued growth, continued strength. I guess Peru has proven that their economic-related institutions are very solid, very well respected. They do their work pretty well even under the previous election and when President Castillo was elected, that was not touched. That has not changed. So we feel very confident on that continue to working out strong superintendency, strong Central Bank, strong Minister of Economy and Finance. But again, it's -- those are the political risks that we are looking at. So I hope that answered your question on that front.

We have a follow-up question from Anand Bhavnani of WhiteOak Investors. Given the boom in copper and lower price of oil, do you anticipate GDP growth to have upside risk and inflation to have downside potential? Can both of which be a tailwind to help you do better? Luis Castellanos López-Torres: Yes. Obviously, those are positive factors that could influence a stronger performance of the Peruvian economy. Obviously, that would help the currency to continue in its strength. It's not a strong pattern as Michela mentioned, the Peruvian sol has appreciated 10% this year. We don't foresee if the commodity prices continue to be strong, probably the sol will continue to follow that path. Inflation will continue under control and having good export results and low cost of energy would help improve some productivity and that should have a positive win towards our economic performance as a whole. And the Peruvian financial system should be a multiplier of that. And again, Interbank and Interseguro, Inteligo, we have a platform that can definitely look at the opportunities that, that positive situation approach. So there's an upside risk on that front that we are prepared to take advantage of. And obviously, we're looking very detailed on those opportunities. Now again, the big question mark can be the political situation, but that's going to clear up in a couple of months. So we'll have a more clear picture probably for the next quarterly call.

At this time, there are no further questions. I would like to turn the call over to the operator.

Thank you. And we are not showing any audio questions as well. So I would like to turn the floor back to Ms. Casassa for any closing remarks.

Okay. Thank you very much, everyone, for being with us today. Sorry again for the inconvenience, and we hope to see you all on the next quarterly conference call. Thanks again. Bye, everybody.

This concludes today's conference call. You may now disconnect.