Intercorp Financial Services Inc. (IFS) Earnings Call Transcript & Summary

Good morning, and welcome to the Intercorp Financial Services Investor Day. Today's call is being recorded. [Operator Instructions] I would now like to turn the conference over to Mr. Luis Felipe Castellanos, Chief Executive Officer of Intercorp Financial Services and Interbank. Sir, please go ahead.

Good morning, and welcome to IFS Investor Day. We are very happy to host this event and hope that at the end of the day, you will have a deep understanding of our strategy, our evolution and our objectives. Before we get started, please note the forward-looking statement disclosure on Slide 2 of this presentation. I am Luis Felipe Castellanos, CEO of IFS. Today, you will hear directly from the people who are making things happen. As such, joining me today as main speakers, we will have Michela, Carlos, Victor, Bruno and Gonzalo. Besides them, other key members of our senior team will take part through different presentations. We have put together a comprehensive agenda for today. First, I will present our overall strategy on how we're building a leading digital financial platform in Peru. Then Victor and Carlos will expand into our distinctive banking strategy. After this, Carlos will continue by showing our efforts to create the largest payments ecosystem in Peru. Moving to the other segments of IFS, Bruno will present the strategy behind our trusted and profitable wealth management business, and Gonzalo will elaborate on our efficient insurance business. To finalize and wrapping it all up, Michela will show you why we believe IFS is the best financial players in terms of sustainable growth and profitability. After the presentations, we will have a short break, and then we will spend time with a Q&A session. So to get started, we will play a short video that we have prepared for you. Enjoy the day. [Presentation]

So let me go into our strategy for building a leading digital financial platform. Everything is centered around our purpose to empower all Peruvians to achieve their financial well-being. This purpose shared by everyone at IFS is what drives us. To do so, we have built a financial platform that is very focused on areas where we believe we can find a unique combination of our own key capabilities coupled with potential for growth and profitability. Interbank is a universal bank with a strategic focus on retail banking. Interseguro is an insurance company with key focus on life and annuities. Inteligo is an advisory company focused in the emerging wealthy. And Izipay a key player in payments, which we now fully own. Through Izipay, we will set the starting point of our fourth pillar. We have become the only player in the country to fully own a consolidated and fast-growing merchant acquirer. Our customer-centric focus has made us [indiscernible] in recent years, we are becoming increasingly digital, following our customers' preferences. Prior to 2014, we had a store-centric model focused mainly on physical convenience. Our physical infrastructure supported growth. Then we decided to transform and build our omnichannel platform with a higher relevance of digital solutions and analytics. We were focused on building digital capabilities within IT, developing digital products and transforming our own culture and organization. Our digital efforts were a support for our physical presence. In 2019, we went into what we call a digital-first strategy, searching for growth through digital solutions and where physical became a support to our digital efforts. We launched several digital-only products and expanded the users analytics to drive our business decisions. Today, we are operating on our new vision, our digital only vision with a 2-tier digital strategy that we believe will allow us to continue to foster profitable and sustainable growth. Let's explore this. The first concept of our 2-tier digital strategy is to ensure that customers can do all they need in a digital way. We must ensure that we can fulfill their financial needs 100% digitally with high levels of satisfaction. For that purpose, we are building a digital bank using our own app with embedded products and services that allow our customers to have a 100% digital journey. I believe this differentiates us from other banks that are launching a separate digital bank effort to complement or disrupt their existing businesses. Interbank is evolving to become a digital bank itself. The second concept of our 2-tier digital strategy is the search for accelerated growth and to increase our customer base by focusing on increasing velocity and tapping new sources of revenues. Our payments ecosystem and open banking strategy is a key pillar to enable this. If done right, this ecosystem will allow us to boost growth and bring more customers into our digital banking and financial services platform. On the first concept, digitalization strategy, we have built digital products and services that allow our customers to have a 100% digital journey to satisfy their financial needs. Most of these solutions are embedded within our app, while others reside outside our app due to the nature of the service. Today, we can onboard a new customer with a few taps by opening 100% digital accounts. We can provide digital financing products, including acquiring and managing credit cards. We can also provide savings solutions with a simple swipe like our Piggy bank solution, and we can make QR payments and transfers from the app. Customers can use a [ PFM ] and budgeting tools, and access and use our loyalty program to redeem points in their preferred merchants, all of this in 1 app. Our digital platform has allowed IFS to grow its customer base by more than 50% in the last 3 years as well as to increase customer satisfaction by 12 points as measured by Interbank's digital NPS. This increase in customers and NPS has come while optimizing our physical distribution channels. For instance, we have reduced the number of financial stores by over 40% from its peak in 2016, making IFS physical rationalization one of the most aggressive in the region, if not the most aggressive. In the accelerated growth strategy, we are focused on building the largest payments ecosystem in Peru. This ecosystem is being built by complementing our leadership in credit cards with embedded payment solutions in our app, like PLIN, which is a P2P and P2MB network already being used by more than 7 million users. Tunki and Izipay allow merchants to grow their businesses by making it simpler to receive different types of payment alternatives. All this is being complemented by our suite of solutions to improve the payment experience and to provide financing alternatives like Dividelo and CIMA. We aim to develop e-commerce and payment solutions, which will improve customers and merchants engagement and activity. We will share more detail in the particular section of creating the largest payment ecosystem in a few minutes. One of the pillars of our strategy is our approach to technology. We are investing heavily in our transformation and our IT CapEx is 5x more than what we invested in 2015 and 50% more in 2022 than in the average of the last 4 years. These investments have been mainly directed towards, first, improving customers' UX; second, further improving our advanced analytical capabilities; third, innovating in digital products and services; and fourth, strengthening our cybersecurity standards. We have more than 100 agile squads working in our digital efforts and have improved [ guidance ] of delivery and sprint times to an average of 15 to 30 days. The main aspects of our IT strategy include alignment with business objectives; multiple cloud architecture and building a platform of micro services and APIs; simplifying processes, operations; reliability and resilience; building a culture of cybersecurity and attracting and developing world-class IT talent. Building robust, flexible and Internet era technology will allow us to compete with the best, including financial incumbents and digital disruptors. Another key pillar of our strategy is our people and our culture. All the companies within IFS are leaders in a Great Place To Work rankings based on our unique working environment that brings out the best of our associates. We have recently launched a new way of working or as we call it, our [ added ] value proposition for employees. ERES is based on a remote first framework that increases productivity and allows us to reach the best talent regionally and globally. But rather than hearing it from me, let us show you a short video about ERES presented by Julio del Valle, our HR leader. [Presentation]

As you have seen, our culture is a key pillar in how we operate. Another key pillar for IFS is positively impacting our stakeholders and building an organization focused on sustainability. Our culture is centered on respectful environment, responsible social practices encouraging inclusion, equality and diversity and having world-class corporate governance standards. This focus has allowed us to reach a 53 CSA Score in 2021, 15 points above the industry's average globally. In this context, allow me to introduce a new video where Zelma Acosta-Rubio, Chief Sustainability Officer of IFS will present our ESG strategy and our main initiatives. [Presentation]

Now to up this overview section, let me present our aspiration in the coming future. First, we want to reach more than 10 million customers by leveraging data and analytics with our superior risk management skills. Second, we want to build a superior customer experience based on operational excellence reflected in a world-class NPS. And third, we want to become the leading digital financial platform with a strategic focus on payments and consumer financing. In the upcoming presentation, we will expand into our platform and our strategy designed to reach our strategic goals. Now going into point 2 in the agenda, let's review our distinctive way of banking, Interbank. Interbank has its own purpose to be side-by-side with Peruvians so they can reach their dreams today. We work hard every day for this to happen. A snapshot of Interbank's numbers, our results are strong. In 2021, we reached a 21% ROE with earnings of PEN 1.4 billion. We're on a very efficient operation with a cost-to-income ratio of 43%. We closed the year with 23% market share in consumer loans and a 10% market share in commercial loans serving a total of 4.7 million customers. Over 65% of our monthly active retail customers are digital customers. As mentioned, Interbank is a universal bank with a strategic focus on retail and consumer finance. As of the first quarter of 2022, our retail portfolio was 52% retail compared to the industry's 34%. And within retail loans, consumer loans represented 60% compared to the 51% at the banking system. As you will see throughout the rest of this presentation, our strategic focus, our expertise, our portfolio mix and our solid risk management skills position us within the most profitable banks in Peru. Now let me pass it on to Victor Cárcamo, VP of Commercial Banking to continue with the presentation. Thank you very much and enjoy the rest of this event.

Hello. Good morning, everyone. My name is Victor Cárcamo, and I am in charge of Commercial Banking at Interbank. As Luis Felipe just mentioned, although we are focused on retail banking, almost 50% of our loans are in commercial banking clients. More than half of these loans are placed in very low-risk corporate companies and the other part is placed in midsized and small business segments that are slightly riskier but very profitable. Our portfolio is diversified into more than 12 different industries. However, it's important to highlight that 17% of these loans are in agribusiness and fishing, high-growth sectors in our country where we have developed a special knowledge and expertise. We have PEN 20 million loan portfolio that allow us to reach a 10% of market share. And we also have a solid deposit base of more than PEN 20 billion. Our growing commercial banking is to build strong long-term relationships, adding value to our customers with a special focus on profitable products such as transactional banking, trade and supply chain finance. Our value proposition for commercial clients is based in 4 pillars: delivering customer-oriented digital solutions, building long-lasting relationships with our customers, developing a strong expertise in relevant sectors and fast decision-making process. In terms of client acquisition, the launch of digital onboarding products allow us to grow more than 2.4x the customer base. We went from 50,000 clients to more than 130,000 in 4 years. But most important is that these customers were [ borne ] digitally from the opening of the accounts onwards. Thanks to that, more than 40% of our clients operate only through digital channels, improving the NPS from 33 points in 2018 to 51 as of March. Our business model consists of creating value for our customers no longer in the traditional way, which was through the disbursement of large loans at very low margins but by becoming their transactional bank, connecting and collaborating with their suppliers, customers, employees and communities, co-creating products and services focused on their own ecosystem. To achieve this, we use transactional and commercial data to develop customized digital products, such as preapproved credit lines for their supply chain, working capital loans for their clients and special payroll accounts for their employees that give them access to a unique list of benefits from Intercorp Group Companies, such as discounts in supermarkets, pharmacies, restaurants, hotels, et cetera. All these products and services are delivered to joint campaigns using customer contact channels. We are convinced that this model will allow us to become our clients' preferred bank and help us build a profitable and sustainable business, while also contributing to the development of our country. We are building a seamless digital customer journey from the onboarding, transaction, financing to aftersales. Our ambition is that in 2 years, no Interbank customer will have the need to [ touch ] any physical channel to operate with us. To achieve this goal, first, we are working on a radical simplification of our products and processes. And secondly, digitalizing our customer journey in each point of contact with the bank. Today, 90% of our customer acquisition is made to digital means, and 66% of our operations and transactions are carried out through digital channels. One of the most important points of contact for our clients is the post-sale division, where the inquiries, claims and any operational issues are solved. In 2020, during the pandemic, we launched a WhatsApp channel for business, which today we solve more than 62% of these requirements, and 40% of those are self-service to a virtual chatbot. On SMEs, our digital approach has allowed us to accelerate customer acquisition. In 2018, we launched our [indiscernible]. With this unique product, we went from acquiring 1,000 customers per quarter to more than 18,000 as of today. But most importantly, these clients operate only digitally and as you can see, has become a very important source of deposits, growing 4x since 2018. Finally, I want to highlight that we are actively involved in ESG initiatives, supporting our corporate clients not only for green financing but also on their social impact programs for their communities. Our specialization in agri business and fishing has allowed us to be very close to them and go hand by hand with their programs. In just 1 year, we have disposed more than PEN 900 million in sustainable and green loans. And our goal is to have 30% of our portfolio labeled as ESG loan in the next 5 years. Now let me show you some of testimonials of our clients and their social impact on their communities where they operate. [Presentation]

Thank you very much. And now let me introduce Carlos Tori from Retail Banking, who will continue with the presentation.

Good morning, everyone. I am Carlos Tori, responsible for retail banking and payments. We will start the retail banking portion by reviewing our loans portfolio. We have PEN 21 billion of loans outstanding with strong market shares in targeted businesses and a strong focus on consumer finance, which represents 60% of our portfolio compared to 51% for the Peruvian banking system. Our 22% market share in consumer finance includes a leading 29% market share in credit cards. This, together with our strong credit risk expertise has allowed us to maintain NIMs high. We also offer products in other main categories to satisfy our customers' needs and keep a balanced portfolio. Our market shares are 24% in payroll loans and 15% in mortgages. We also have continued to grow our retail deposits at a faster rate than the banking system. Despite having reduced our financial stores by 40% in the past 5 years, as Luis Felipe mentioned earlier. We now have PEN 22 billion in deposits which is larger than our retail loan portfolio, and we have improved our market share from 13% in 2018 to 15% in 2022. During this period, we have focused on learning from and listening to our customers and have been able to improve our NPS, particularly the NPS of our digital customers, which now is 49 points. To improve our NPS, we received feedback on the spot and use speech analytics to identify pain points and solve them in a structural manner. We also do in-depth, design-type interviews with customers and assign main issues and ideas to our product managers so they can work on directly improving processes and eliminate these pain points. We measure NPS continuously and focus obsessively on improving it. This has been recently validated by a research paper by Arellano Consultoría that was published in the press a couple of weeks ago, where we came out as a bank with the best NPS in Peru. In line with listening to our customers, our strategic priorities in retail banking are building a digital-only experience. This experience should be simple and trustworthy and should not require our customers to come to our financial stores. Two, we aim for all our interactions with our customers to be personalized and contextual. To do this, we must continue to build strong analytics and anticipate our customers' needs; three, we will maintain our focus on consumer finance with high market shares on the most profitable products and will continue to manage risk through strong analytics and discipline. Finally, building the best payments ecosystems. We are the only Peruvian bank with an acquiring business, which we believe will be a pillar for future growth. We will talk more about the recent Izipay acquisition in the payment section. As a result of these priorities, we have built a 100% digital customer journey with a strong increase in customers that start with working with Interbank through a digital channel and dedicated teams to improve each step of the customer's journey with specific KPIs, which for each, which you can see at the bottom of the slide. We believe that a strong onboarding leads to more engaged customers and an increase in engagement will ultimately be tangible in higher NPS and lower churn, both of which have improved for us in the past years as we will see in a couple of slides. We have created several high-impact digital solutions based on our customers' preferences and needs. These solutions have been designed together with our innovation lab, [ La Bentana ] based on deep understanding and research as well as co-creation with our customers. We have decided to make all these solutions available in our Interbank app. Even though it can sometimes be a challenge for our IT team to build everything in 1 app, we strongly believe that our relationship with our customers will continue to be through our app, and it is important to have everything together in 1 comprehensive application. Please let me do a quick review of these services. First is our fast and easy process to open an account digitally, which has allowed us to acquire many more customers and help us in bancarizing Peruvians. This solution is available in our app and on our public website. The digital process to get a loan has improved our reach and reduced our cost of selling. My favorite and proudly, our customers' favorite is the virtual Piggy bank, which was created from deep insight with our customers that have a hard time separating funds for saving. This solution allows our customers to set goals, obtain differentiated pricing and most importantly, to have their money in a separate place that they don't have to see every day so that they don't spend it. But they do have access to it if they need it. We also have our own [ PFM ], coupled with [indiscernible] score tracking and advice to promote financial education and as a result, better access to credit. Interbank benefit is what we believe to be the best loyalty program in Peru, and which was designed specifically for digital use and e-commerce transactions. Furthermore, we have a suite of open banking products that allow us to be where our customers and potential customers are with simple and sometimes invisible solutions that allow us to increase engagement, generate income and gather more data. We are currently working with 40 different partners, and we already have more than 1 million transactions per year. Now before continuing with the presentation, let's see a video that summarizes this frictionless digital experience. [Presentation]

All these digital offerings have allowed us to increase the number of customers, mainly through more efficient digital acquisition, which as of this quarter represents 67% of our new customers and have many more customers interacting digitally at 65%. This is very important because it allows us to control the experience, create more engagement and satisfaction. And as I mentioned before, this leads to lower churn, which in turn contributes and circles back to our efficient growth. As you can see in this slide, the behavior of our customers has changed. Our digital customers have gone from using our app or home banking 5x per month on average to 9x per month. Since we have many more digital customers, the total amount of digital transactions has almost quadrupled. On the other end of the spectrum, the customers that still use our financial stores go there less often. And since the number of customers that still go to our stores has also decreased, the total transactions and branches have decreased to 1/3 of what it was in March 2019. Furthermore, only 17 of our customers still visit our financial stores. We have seen a similar effect in the reduction of transactions in ATMs as customers are using their cards and digital payments more. I believe this slide more than any other reflects the change in our customers' preferences. Some of it has to do with our nudging and digital strategy, but most importantly, it has to do with how our customers have evolved themselves. They expect to have all products and services available 24/7 and a great simple experience. Our growth numbers, profitability, NPS and reduced churn show that we're going in the right direction at a rate that was made possible due to our early focus on developing digital solutions and processes. This strategy to focus in digital was executed together with the optimization of our physical footprint where we have reduced the number of our financial stores by 40% in the last 5 years and have reduced our sales force by 30%. At the same time, we strengthened our alternative channels. Correspondent agents grew 85% to give capillarity and convenience to our customers at an efficient cost structure, and we grew the number of agents in our inbound call center to help manage inquiries from our growing customer base. As a result of this, our digitalization has allowed us to improve our relationship with customers while improving profitability. We have grown our customer base by 19% in the last year, increased the number of products sold by 22% and have grown revenues at a rate 3x higher than costs. Now let me tell you a little bit more about our data and analytics initiatives. The core of our digital strategy relies on strong analytics, building a good digital product is difficult, but everyone will do it eventually. We believe our true differentiation comes from understanding our customers profoundly and interacting with them in a personalized contextual manner. To do that, we have focused in 3 initial pillars: one, have a strong technological stack for our databases and models; two, having access to as much information as possible, and we have been able to leverage information from our partner companies at Intercorp to improve our models; and three, developing the right talent for which we have recruited aggressively, locally and internationally and invested in developing this talent. Our deep understanding of Peruvians focuses on 3 strategic areas: marketing analytics, risk and collections. In marketing analytics, we aim to anticipate the needs of our customers with personalized and timely solutions. We are evolving from advanced analytics to artificial intelligence to deliver personalized real-time experiences to all our customers. We have over 400 models, most of which are in the cloud and that use over 4,000 variables. We are focused on improving time to market as well as increase the number of personalized offers. The difference between a personalized offer and a mass offer would be the following: instead of sending an e-mail to our customers telling them there is a 30% discount in a list of stores, we send each customer a curated list of stores based on their preferences and past purchases. Some might not give discounts, but we'll get a reward bonus on loyalty miles for each purchase. And not all of them will get the same discount or the same bonus. What each client gets depends on their willingness to buy or customer value. In this way, we connect with our customers with higher impact in engagement at a more efficient cost. Our ability to assess customers' profile in the correct manner, together with our balanced portfolio approach has allowed us to grow in a healthy manner. We are focused on improving our assessment through more and better models and using as much information as possible. We have been able to increase our addressable universe of potential customers by 50%. Furthermore, we have been able to deliver contextual credit offers digitally in real and near real time. For example, a good customer that comes close to topping her credit line due to a large purchase make it an offer for an increase in credit line or a personal loan offer. This example allows us to maximize our relationship with strong credit customers while generating a sense of togetherness and loyalty. We also apply advanced analytics to improve our debt collection process, creating an efficient digital and empathetic experience. Machine learning models have allowed us to improve contactability and response by over 15% in the last year. Contact with customers has improved from 59% in 2021 to 69% in 2022. Customers in early stages of payment delay are more responsive to our contact through a digital channel than an actual telephone call. So it has been important to develop a self-service environment that gives our customers flexibility in an easy and empathetic manner. Through analytics, we are working to become the digital ally in the hearts and minds of Peruvians. And as I wrap up to this section and to summarize our banking strategy, we are a universal bank with focus on retail and consumer finance. We are growing our customer base digitally and improving NPS. We are creating a seamless digital journey for our customers and optimizing our footprint. We continue to invest in our artificial intelligence to create contextual experiences and we have been able to improve operating leverage through our digital strategy. Now we will continue with our payments section. And now on to payments. As you know, an integral part of our strategy is creating the largest payments ecosystem in Peru. But before getting into it, let's see how PLIN and QR payments are used on a daily basis. [Presentation]

I am sure you enjoyed the video and hope to see you in Cusco soon. As part of our payment strategy, we aim to change what doesn't make sense to make buying and selling easier. The recent Izipay acquisition will enhance our payments ecosystem. It is a fast-growing and already profitable business that is a leader in the merchant acquiring business in Peru and still has a lot of opportunity to continue growing. We believe this transaction will be transformational for IFS as it makes us the only financial platform with 100% owned merchant acquirer. We also consider that the acquisition price was done at a very reasonable multiple. The company is already profitable and has increased the number of merchants and transactions considerably since the end of 2020 and EBITDA is at a healthy PEN 118 million for the last 12 months ending in April 2022. Izipay will be the pillar of our payments ecosystem and we will be able to embed many of the solutions that we have at the bank in their product offering and value proposition, such as loans for merchants that we have already been building and testing at the bank. In the past 3 years, we have offered more than 10,000 loans to merchants through our CIMA initiative, which is a solution that is able to disburse loans digitally to merchants in less than 3 minutes. We are very excited for the synergies that will develop between CIMA and Izipay, but this is only 1 of the many examples of opportunities that lie ahead. We expect for Izipay to continue to increase its fee business and to create income flows from client float and interest income from loans. Our payment ecosystem benefits from having strong solutions of both ends of the market. Our strong share and knowledge on the traditional and digital card payments on the retail customer side and Izipay on the merchant side, complemented with [ the role ] Tunki has in the [indiscernible] bank population and with CIMA contributing in the financing side. PLIN allows us to interact with customers from other bank and also serves as a bridge between retail customers and micro merchants. This ecosystem also allows us to scale our other initiatives, such as our e-commerce solutions and Shopstar which is our marketplace and finally, Dividelo, which is our buy now pay later solution. We have 5 priorities in our payment strategy. One is to continue to grow the number of clients and transactions; two, replace cash; three, grow e-commerce; four, obtain new sources of data and finally, offer financing and aggregated services to our merchants. And we are creating solutions for all market segments. On the retail side, we have Interbank serving the bank customers. And on the merchant side, we have Izipay and Interbank offering cash management and loans to the larger clients while CIMA complements in SMEs and micro merchants. Also, Tunki is having good traction in the unbanked segment, both in retail and in merchants. And finally, PLIN, which is growing strongly and is able to bring together the unbanked and the bank's customers. All this brings clear sources of value and growth. One, flow from customers; two, fee income from transactions and aggregated services; and finally, interest income from financing. In the next couple of slides, I will do a brief overview of each of the solutions that make up this payment ecosystem. Each solution is in a different phase of maturity but they are all designed to work with and complement each other. Tunki is our digital wallet, aimed at giving the unbanked population an entry point and particularly a connection to bank customers through the PLIN network. It is designed as a simple solution that allows customers several transactions such as top-ups, bill payments and access to cash at our ATMs without the need for a debit card. We also plan to start piloting micro loans shortly. Tunki has gained good traction over the last couple of months, growing the number of micro merchants by 4x and reaching almost 2 million transactions in May 2022. PLIN is our person-to-person and person to micro business network and QR payment solution. It is connected with most banks and having been launched right before the pandemic, has grown faster than any other payment solution in Peru. We have already reached 7 million users and continues to grow very fast. It has reached 1 million micro merchants and transactions have grown over 20x in the past 2 years. CIMA is our financing solutions for small merchants. Even though it's still small, as I mentioned before, we have already offered 10,000 loans and have learned a lot in the process and believe it is at a stage where it is scalable. It is a 100% digital solution with immediate disbursement and can use POS flows for repayment. Dividelo is already connected to over 20 e-commerce businesses. It does charge an interest rate but at a preferential rate and it rounds monthly payment amounts to make it easier for buyers. It is available for credit card customers and for new customers as well. Shopstar is an e-commerce platform for IFS customers both on the retail side and also sellers that are clients of commercial banking. It was originally created from the insight that many of our customers were not comfortable buying on e-commerce, but would be willing to try it in a platform that was curated by Interbank. It also allows us to pilot and improve new payment solutions, such as payments with Miles or our buy now pay later solutions and has been gaining traction in the last few months. As of May 2022, it has over 250 sellers and GMV is north of PEN 28 million, which represents a 60% growth over the same period last year. Finally, we have Rappi Bank, which is our partnership with Rappi. Even though it is still small with a loan portfolio of PLN 39 million, it has allowed us to learn more about the preferences and behavior of new segments of customers. We continue to explore new ways of serving these customers in a profitable way. And now to wrap up the payment section, here are the key ideas that I would like you to take away. The Izipay acquisition enhances our payment strategy and will accelerate our growth. We currently are the only player in Peru with a fully owned and established acquiring business. Our ecosystem will allow us to increase customer engagement with clear sources of value. We have a suite of payment solutions aiming to accelerate bancarization and we have a clear path to offering financing and aggregated services to merchants. Thank you very much for your attention today. Please let me pass it on to Bruno for a description of our Wealth Management platform.

Thank you, Carlos, and good morning, everyone. My name is Bruno Ferreccio, and I will be here discussing with you today Inteligo's business. Let me start by answering 1 simple question. Who are we? Inteligo is a profitable and trusted wealth management adviser to Peruvian high net worth individuals and other private wealth management customers. What is our purpose? We approach every day with the goal of building financial security for our clients. Their primary focus is to preserve and enhance their wealth created through their life and careers. And our focus is to help them assure their well-being so they can enjoy the present. How do we do it? Our value proposition is centered on giving the best investment advice possible and to achieve that, we cultivate closeness with our clients to acquire in-depth knowledge of their needs while also leveraging a wider range of financial products through our Inteligo companies as well as the IFS platform. Apart from being knowledgeable about our clients' needs, we are able to be more responsive as a result of a horizontal organizational structure and an entrepreneurial mindset. Our competitive edge is in adapting to the changing needs of our clients to give them agile solutions. Our service is delivered through 3 operating companies. Bahamas-based Inteligo Bank and Peru-based mutual fund manager, Interfondos as well as Inteligo SAB, our brokerage arm. And what have we been able to achieve so far? Well, outstanding results. During 2021, we delivered a 23% ROE with an efficiency ratio under 35%. We reached over PLN 20 billion in assets under management of which over 80% were in our high net worth segment, where we serve approximately 4,000 clients. More importantly, we are especially proud to have achieved 76 points in client satisfaction as measured by Net Promoter Score. We run a low-intensity capital business model, which is able to sustainably deliver high ROEs as a result of cost efficiencies and diversified sources of revenue as we complement our services with IFS' other subsidiaries. Contributions to revenue come mainly from customer-driven fees and net interest. Other income is derived from our investment portfolio, which serves as a complement to revenues from our Wealth Management business. We invest with a long-term view, understanding that we are subject to short-term volatility, but with the conviction that our strategy will allow us to sustain our long-term historical return on investment above 7%. We focus on being lean and efficient and think sustainable cost to income for us is under 40%. Even though we expect to continue investing in technology and product development, we have already invested in core technological capabilities that sustain our current business size and have ample space for scalability. This supports our view for sustained healthy cost-to-income ratios going forward. And while we're very proud of achievements today, we believe there are still new and exciting opportunities to lead our growth into the coming years. We believe in simplicity over complexity, and that's why we have set up a clear strategy built on 3 main pillars: our digital and omnichannel model enabled by data and analytics, which also should allow us to reach new client pools. We are pursuing hyper-personalized value proposition, creating an ecosystem where we leverage client, product and channel data to generate customized insightful solutions, which will be delivered through an omnichannel infrastructure. As this is a cornerstone of our strategy, let me walk you through some of the details of how it works. First, we have a component of our model based on factories where products and clients are booked. We have a guided architecture strategy from Inteligo's wealth management franchise plus IFS to best-in-class external financial products. We then incorporate the data from these factories into our cloud infrastructure, building a 360-degree client view. We process several data points from client investment behavior to risk assessment and asset allocation to advance commercial analytical and digital data among others. Our engines build up a unique client personalized investment and financial insight, which is relevant not only for the client but also for the relationship manager. The final layer of the model is information delivery to all relevant agents directly to clients through digital channels and to the relationship manager as part of their commercial agenda. As a result, the client receives a highly personalized and integrated advisory experience across all channels. This relationship-oriented model has allowed us to improve our NPS by over 20 points in the last 5 years. This makes us think we're on the right track. As part of this effort, we are working on a brand-new digital platform where this hyper-personalized advisory approach can be effectively delivered. On this platform, clients will be able not only to have a consolidated view of their wealth across all booking centers, but also to gain perspective on key relevant issues affecting their portfolio and if needed, address corrective actions. This will lead to a much more focused and effective conversation with the relationship manager as we build an enhanced advisory experience for our clients. Finally, our client experience teams work directly with the customers to explore the most effective ways to generate engagement and good understanding of our messages. This also in order to continue to improve our delivery solutions. The data integration and modeling we have been developing in recent years have already materialized into value opportunities for our business. We expect to continue growing our business organically through a combination of reduced churn, improve data enabled, leads for new client acquisition and deeper knowledge of existing client potential. Data-driven AUM growth was around 15% of total increases in net new money between the years 2020 and 2021. So it's already paying dividends. We also have a clear road map for other data-driven opportunities going forward. We are initially rolling out our data models in the high net worth segment, but with the option of expanding them to other segments in the future. We are convinced that our current capabilities and ongoing developments in data and digital competencies open new opportunities for us. In our main market, Peru, we can develop investment advisory to more clients from the IFS platform. This, through a digitally enabled simple process that can take the client from onboarding through investing all the way to account management. This should enhance our reach. We also believe our business model is replicable in other countries in Latin America. We plan to expand in the region to countries where there are high net worth clients with underserved needs, which match our value proposition. Our expansion will build on Inteligo's outstanding advisory capabilities. And so to sum up, what would we like you to take away from this presentation today is that Inteligo is the premier private wealth management provider in Peru. We have a deep client knowledge and pride ourselves in the proximity and agility of our advisory process, which results in outstanding results for our clients. We are using technology to boost our advisory capabilities, heavily supported by data as a core asset. We have delivered sustainably high ROEs and we'll take advantages of any opportunities to grow in Peru as well as in Latin America. I thank you all for your time, and we'll be open to questions at the end of the Q&A session. I will now leave you with Gonzalo to discuss Interseguro.

Good morning. I'm Gonzalo Basadre from Interseguro and I'm going to tell you about our company. It all begins with our purpose. We make it easier for Peruvians to safely move forward. We cover the risks Peruvians face so they can confidently concentrate in achieving their goals. And we try to make this process as easy as possible. Also note, that our products are for people, not corporations. We are focused on the middle class that has strong in our country in the last 20 years. Let me give you some key figures of our company. Interseguro is a highly profitable company with an ROE above 20%. We've been growing at a very fast pace, 23% on average in the last 3 years. We are market leaders in annuities with a 32% market share. We hold the industry's largest investment portfolio. We have the lowest cost structure in the industry. Expenses represent less than 1% of assets. Our digital sales are growing very fast, 53% in the last year. Finally, we have more than 2 million customers. Before going through each of these figures, let's take a look at the insurance industry in Peru. In the last 20 years, it's been growing 2, 3x GDP. In the last 4 years, CAGR has been 14%. The graph on the right side shows why we think this growth above GDP will continue for many more years. Notice how economies grow. Insurance takes a bigger share of GDP. Key to our results have been our focus only on certain segments that provide superior growth and profitability. Life insurance represent 91% of our premiums compared to 52% for the industry as a whole. Within life, we are more focused on annuities, individual life and retail insurance. This has allowed us to grow faster than the industry, 23% CAGR in the last 3 years. This has been especially true for annuities and individual life. And with the market leaders in annuities, in the last 10 years, this is important for us as this product provides scale. Accumulating the largest investment portfolio in the industry, but not only do we have the largest portfolio, but we also have one of the most profitable. In the last 5 years, our investment returns has been higher than the industry and our 2 main players. Scale plus a very disciplined cost structure has allowed us to be the most efficient insurance company in Peru, measured as expenses divided by assets. Focus, scale, high investment returns and low cost has allowed us in the last 5 years to obtain 2x the profitability levels of the industry and above the 2 main players. On top of this, through digitalization, we're building the best customer experience in terms of convenience and simplicity. This is made possible by our data capabilities. We started our digital journey with SOAT, the mandatory car insurance. It's a low-priced standard mandatory product ideal for sale through the digital channel. Now more than 80% of our sales are digital with a growing market share. Growth hasn't been at the expense of profitability. Despite having the lowest price, we have one of the highest margins. This has been possible because of our low cost base, efficiencies obtained through digitalization and our risk models. [indiscernible], a completely digital life insurance product has been gaining traction from being in existent 3 years ago. Last year, it represented more than 20% of premiums of the policies issued. As a result, we have grown our digital sales by 6.8x between 2018 and 2021, with a 79% growth in the first quarter this year compared to the previous year. Our number of clients acquired digitally has more than doubled from 240,000 to more than 500,000 in 2021. This has been possible through the use of data and analytics for marketing campaigns, purchase propensity, risk models, churn segmentation. In summary, Interseguro is an insurance company focused on fast growing and profitable segments. It has the largest investment portfolio with a high return, highly efficient operation consistently delivering profitability above its peers. We are building the best digital customer journey with simple products. Thank you.

Hello, everybody. I am Michela Casassa, CFO of IFS and Interbank, and it's a pleasure to be here with you all today. I will close our first Investor Day talking about why we consider IFS to be the best financial player for sustainable growth and profitability. I'm going to focus on 3 areas of strength, which are growth, diversification and profitability. And then I will share a summary of our medium-term goals to round up the strategy we have presented today. So let me first tell you about the growth story we are already delivering. We have accelerated the growth of our customer base as evidenced by the 16% year-over-year growth in IFS customers, which today reached 5.6 million and by the 19% year-over-year growth in banking customers. This growth is the first tangible results of our strategy and is based on the following key initiatives. First, our 100% digital account for both retail and commercial banking customers which together with digital sales for insurance and wealth management customers constitute today the most important source of new client acquisition for IFS. Second, Tunki, which is specifically targeting a bank customer, both retail and micro merchants and offering them a possibility to enter the financial system and access financial products and services. Moreover, our analytical capabilities together with our digital marketing efforts are helping us to better identify target customers and to better assess the risk profile resulting in more customers, more cross-sell and better cost of risk. Finally, we believe the recent acquisition of Izipay will further enhance this growth, thanks to the new opportunities that will boost our payment ecosystem. This growth in customer base has a clear path to sustainable profitability. Carlos showed how a 19% year-over-year growth in retail customer has resulted in a 22% growth in number of [indiscernible]. And finally, our operating leverage of 3x meaning retail banking revenues are growing 3x faster than costs. Looking at a bigger picture at IFS level, our monetization path includes 4 stages. The first is focusing on increasing engagement with our customers, and this includes all solutions developed to increase the frequency and depth of contact with our customers. Here, we're talking about PLIN, which is a clear enhancement of our value proposition for day-to-day payments and my finances with the credit score and others. The second stage refers to cross-selling, IFS products and services, both existing and newly developed. Key digital products include Piggy Bank for savings, Digital Financing for retail and SME customers acquiring services through Izipay among others. The third stage is closely linked with the previous 1 as we're talking about the revenues generated by cross-sell. Main sources of revenues are coming from interest income, thanks to additional loans and deposits; from fee income, thanks to payments and wealth management and other income from our investment portfolio. Finally, the last stage is the lower marginal cost of the newly acquired customers with lower acquisition costs and cost to serve and increased use of digital solutions. These trends are allowing us to reduce costs in physical distribution channels like financial stores and sales forces. Finally, we are improving operating leverage, which is what we believe will continue to lead to sustainable profitability for IFS. As a result of the above, we've had a solid balance sheet growth. Loans and deposits have been growing between 10% and 11% on average in the past year, the investment portfolio more than 15% and total assets around 12%. The second highlight of my presentation is diversification. We have diversified sources of earnings historically coming from banking, insurance and wealth management and now being complemented by Izipay. Historically, around 70% of earnings came from banking. But during 2020, where banking earnings were severely impacted by high provisions you took of it, both insurance and wealth management businesses proved to be very resilient and allowed us to book PLN 800 million earnings and to distribute dividends in a year where very few financial institutions were able to do so. Moreover, with the recent acquisition of Izipay, we will further diversify our sources of earnings with a fast-growing and profitable business, which is mostly fee-based. In addition, this should positively contribute to illuminate the value of our platform, in line with what we are seeing in the market towards valuation multiples of payment players. Diversification is also present within each of our 4 businesses. As Carlo mentioned, in banking, we are focused on retail and consumer finance with 55% of our loan portfolio in retail banking. In insurance, Gonzalo showed that 91% of our premiums are coming from life insurance. And in wealth management, Bruno showed that 44% of revenues come from fee income and finally, in Izipay, 74% of revenues are coming from the acquired business, also fee-based. All of these businesses have 2 things in common. They are growing fast and profitable. In summary, banking is the biggest contributor in terms of income from loans and deposits. Insurance, in terms of other income from investments and wealth management and payments are contributors of fee-based income. The last important source of diversification for IFS is our balanced loan risk profile. Given our focus on retail banking, we have always managed a less riskier portfolio in commercial banking, both in the risk levels of each of the commercial segments and by having a lower incidence of small and micro businesses. Our average cost of risk for 2018 and 2021 stands at 1.8%, which is the average of 3% in retail and less than 1% in commercial banking. Moreover, we have a high coverage ratio of 160%, which is a result of a 200% coverage ratio in retail and around 100% in commercial banking. Moving to profitability. Our focus on retail banking allows us to have an interesting yield on the loan book at more than 8% and growing with retail at almost 13%. Our NIM stands at 4.5% and a risk-adjusted NIM at 3.6%, one of the highest in the region. As Gonzalo and Bruno have previously explained, we had solid returns on our investment portfolio, as evidenced by the 6% and 10% return on the investment portfolio for Interseguro and Inteligo. We do recognize that market conditions may impact these results, but we are focused on the long-term results of our portfolio. Our efficiency ratio of 35% is best-in-class in the region, thanks to our business mix and our strong and consistent focus and efficiency. We have solid capital ratios in all of our regulated businesses that put us in a comfortable position to face future growth. We have a track record of strong returns with an ROE of around 19% between 2019 and 2021, which is composed by a 21% in both banking and insurance and a 24% in wealth management and considering holdco expenses. All of these profitability trends have contributed to our sustainable growth in earnings with a CAGR of 10% in the past 7 years and has allowed us to distribute dividends consistently. Finally, let me point out our main goal for the future. We want to grow our customer base to more than 10 million in the next 5 years, maintaining attractive ROE levels of around 18%, with a solid core equity Tier 1 ratio of around 11%. We will continue to focus on efficiency, improving our operating leverage to target an efficiency ratio below 35%. We are committed to our improve our CSA score to around 70 points and to become a reference in sustainability. We hope you have enjoyed the presentation. Let me close with a summary of the key messages that we have delivered today. We are building a leading financial services platform with a 2-tier digital strategy to foster growth through the creation of our embedded digital bank and the largest payment ecosystem. We have an instinctive way of banking with a strong focus on analytics and digital capabilities, which is already delivering tangible results. The acquisition of Izipay will boost our strategy to become the largest payment ecosystem. We operate a trusted and profitable wealth management adviser with potential for further growth, both locally and internationally. We have a leading, highly efficient insurance business with focus on life and annuities, which is growing nicely and going digital. At last, we believe we are the best financial player for sustainable growth and profitability. As the strategy, we have been executing for a number of years, is a comprehensive strategy that effectively combines the strength of our key businesses with the new opportunities offered by digital. Thank you for your attention. We will have a quick break before we start the Q&A session. We will be back shortly. [Break]

Now we will begin the question-and-answer session. I will now turn the floor over to Mr. Ernesto Ferrero, Intercorp Financial Services' Investor Relations Officer. Sir, please go ahead.

[Foreign Language] and welcome back to our Q&A session. We are happy to address any questions you may have. From now on, we will take any live questions via phone and via chat. First, we will take the questions from the phone. I will turn the call back to the operator for instructions.

[Operator Instructions] The first question comes from Jason Mollin, Scotiabank.

Can you hear me?

Yes.

Great. My question, maybe to start out as a great congratulations from the presentation. It was very helpful. My question -- my first question is based on the outlook for Peru's economic growth. It seems like we're in a much lower range than we have been historically. Maybe you can comment on that as well as the high interest rate environment, it's not something alone -- that's only in Peru. But it seems like we're going to have lower growth and higher rates for a longer period of time. If you can talk about how the bank and the group is positioning itself in this kind of environment, and really maybe as a second step, talk about the sensitivity of your income statement and balance sheet to a higher rate environment in Peru.

Okay. Jason, thanks very much for your question, and thanks for being with us today. On the first part, obviously, the outlook of the economic growth for Peru is a conservative outlook. I think that Central Bank now expects growth to be close to 3%, some analysts are saying maybe a little bit lower than that. So clearly, it's not going to be a high growth year and the same happens for the years to come. And you know why, there's lots of things happening internationally. And the dynamics in Peru itself are not great. The political uncertainty is also creating a toll on that. Consumer confidence is low. Investors' confidence is also low. There's not much private and public investment going on so far. So that panorama is not good. And then we see obviously, high inflation, the Central Bank with the mandate to control that raising rates, taking out money from the system. So clearly, as is happening in the world it's a picture that has us being very [indiscernible] on making sure that we continue to strengthen the balance sheet of the bank, having it well provisioned. We think that the second half of the year growth is going to be slow. So we are taking our own measures in order to be more on a conservative approach. The growth for the beginning of the month, especially in consumer has been very strong. However, we don't foresee that continuing in the near future. Growth is going to still be there, but probably more moderate than what we have seen before. We're already taking actions in order to curtail that growth according to our risk appetite. We're seeing early signs that some deterioration in certain segments of the population are starting. Obviously, because of the inflation effects, people are more concentrating in making sure what they have, allows them for the like primary needs and then they will focus on the secondary. So we are very conscious of that, and we are taking measures in order to make sure that we continue to build a solid bank according to our risk appetite. Now in terms of the sensitivity on the income statement of the increase in rates, let me pass it on to Michela, who can give you more detail on that.

We have discussed about this in past conference calls. And actually, the sensitivity that we have on interest rates, it's like a leading exercise, we continue to update it because it changes from time to time with the structure of the balance sheet and the speed of the increases in the interest rates. So basically, what we have seen and continue to see in the sensitivity of [ Solis ], is that for each 100 basis point increase in the interest rate in [ Solis ], we have kind of a neutral to positive impact. In dollars, in past exercise, we were seeing a negative impact of around $5 million. But what we have seen with the new structure of the portfolio is also a more neutral impact. So summarizing both sensitivities are today as we are seeing it neutral to the balance sheet of IFS.

[Operator Instructions] We will now move to our next question, which will come from Yuri Fernandes with JPMorgan.

I have 2 questions here. The first 1 is regarding your digital apps initiatives like you have different solutions, and I understood they have different -- they are being used for different things. But why not having a super app, right? Because in the end, although Tunki, PLIN like the Rappi Bank, even if you pay like in the end, you are trying to connect to the clients, increase bancarization, increase transactions. So my question is, why do you believe this multi-app strategy is the winning one? That's the first question. And my second question is regarding our SCE portfolio. I remember in the past that you were using Reactiva and other government guaranteed loans to grow more than business loans. And lately, we start to see retail loans recovering a little bit and normalizing and we're gaining market share. And from the presentation, my impression was that the focus is consumer finance. And I guess you were always a bank of consumer finance. So that's totally okay. And I guess that's your value proposition. But my question is regarding the business loans, like the SME, like what is your strategy for that segment? Do you want to serve? Do you want to be smaller again? Do you want to keep those clients? Will you be able to keep those clients? Just an overview on the SME clients. And thank you very much, and congratulations on the good presentation.

Thank you very much, Yuri, and good to hear from you. I quite didn't get the whole part of your first question, but I think Carlos Tori did. So let me pass it on to Carlos to talk about our digital apps and the strategy between Tunki and PLIN.

Yes, it's a good question. First thing I would like to -- to explain it, PLIN is not really an app. PLIN is a network that connects different banks and customers. So in order to do a transfer or a P2P on PLIN, you will go into your bank's app. So it's not a different app per se. It's similar to [indiscernible] actually, okay? And the role that Tunki has within PLIN is Tunki is the only app that gives non-bancarized customers access to PLIN. So if you don't have a bank account because you want to, for whatever reason, you open Tunki, and through Tunki, you can access all the clients that are in the PLIN network. So that's kind of a role with Tunki. In terms of Izipay, it has some overlap with Tunki, but in reality, they serve 2 different markets. Tunki is more for an unbancarized merchant and smaller merchants, whereas Izipay serves from very large to middle and to small. All of these parts are part of 1 strategy. Obviously, the Izipay acquisition is very recent, and we will see how those synergies move forward in the next couple of months, but it will have to do mostly with what the customers are asking and how they are understanding our services. But as for now, there are 3 different services, not necessarily 3 different apps within 1 payment strategy.

Okay. Thank you, Carlos. And on the SME, Rappi question, let me give you a crack or maybe Victor can complement. As you know, our strategic focus is retail, consumer financing, and we also have a very good and balanced portfolio with commercial, corporate and medium-sized enterprises banking. We like that combination. I think there's potential for growth in the commercial portfolio, and it's also a good balance because of a different industry know-how in terms of risk for our portfolio overall. So there's growth, well-managed risk and profitability. Now the SMEs is a very interesting segment that we've been working throughout the years. We're very focused on profitability and not that much on size there. So we're targeting good customers there. Today, we have between 3% and 4% market share. During the pandemic, we saw an opportunity with [indiscernible] Reactiva get overexposed to that segment with certain guarantees in order to develop something that is very important for that business. Develop the analytics to be able to provide digital solutions and deep knowledge of that segment into those types of clients. So we've been doing that. However, the situation, especially for SMEs has not been easy because the pandemic has had a very big toll on many of those segments. So we remain committed to being relevant in that segment. We think we are stronger now based on the solutions that we have built and on the analytics that we have developed, but we're not going to grow in that segment at any cost. We continue to grow on a profitable way. So while we see that our SME Reactiva portfolio is coming down because some of the small enterprises are not making it. We are learning how to deal with the best and providing them solutions that make us comfortable that we can build a profitable and sustainable business on that front. So it continues to be our focus. It's not that relevant yet, but we see lots of opportunities for us that, if well managed, it could become, in the coming years, an important part of our portfolio. I don't know, Víctor, if you want to complement anything around that?

Yes, sure. As you just mentioned, Reactiva loans allow us not only to grow in terms of loans, but in terms of clients. We acquired almost 20,000 clients with this program. And now we are focused on converting these Reactiva loans into regular loans. So this first quarter, we grew our portfolio almost 25% in SME loans.

If I may just a follow-up regarding the multi-brand in that environment? And how do you think about CAC in that? Like you think having -- I understand like you have different niches, but don't you think like the CAC may go up because you have those different brands? And a final one, the 10 million clients, what is the time line for that? Like what is the date for the 10 million customers you provided as the guidance?

Okay. I quite didn't get the first part of your question. I'll pass it on to Carlos, apparently he has better audio than myself. But in terms of the 10 million customers objectives is the medium-term objectives. We are targeting that in the next 5 years, we should -- we get into those numbers. Now for the first part of your question.

Okay. In terms of CAC for the different ways of acquiring clients, let's start with the Interbank. Interbank has a traditional way on our stores and how it was, and we have digital. As you saw in the presentation, over 60% of the new customers are digital. The CAC for that is about 1/10 of what traditional is, okay? So it's about 1/10. Tunki is digital, all acquisitions with Tunki is digital. So it's very similar to the bank's acquisition, marginally different because of Interbank, the brand is higher, but basically, it's 1/10th of traditional. And then Izipay is much different because Izipay has very low digital acquisition for the tap to pay and stuff like that. That's one end of the market, which is almost negligible. But you also have the large corporations where you have to integrate the back end of -- I'm just going to like [indiscernible]. Obviously, a customer like that would be a high acquisition cost. So it has a whole range. But obviously, depending on the size of the customer and the size of the market, it kind of grows. But at the very low end, it's somewhat similar and basically the same as the digital and the bank. So it's very low.

And now we'll take a question from Carlos Gomez from HSBC New York.

Thank you very much for the presentation. It's obviously a big effort by everybody involved and all executives, and we appreciate the opportunity to know more about IFS this way. My question is about your traditional strength which is credit card. Can you describe us how the market has changed or it hasn't in the last 2 or 3 years with the pandemic? And how do you see the product going forward? Do you capture most of the clients as banking clients or as separate credit card clients? And therefore, do you think this is a market that could perhaps be disrupted in the future?

Okay, Carlos, thanks very much for your question. Let me pass it on to Carlos again for a credit card explanation.

So Carlos, the last 3 years have been -- the market is the same. But during the pandemic, there was a drop in volumes in credit cards for all banks. There was a lot of refinancing on some banks in early 2020. Right now, we have almost recovered. I think we're a little bit -- as an industry, we're almost above of what it was in 2020. So it has recovered. I would say that it has recovered with a better cost of risk across all banks, also for us, so a better cost of risk. And we think the types of balances within the credit cards, also there's a lot more of consumption and installments and much less balance transfer. So it's more healthy, at least for us. I don't know the competition, but for us, it's a much healthier mix of types of clients. So that's kind of what has happened in terms of our portfolio. So it's a healthier and more profitable portfolio because less balance transfer and more consumption. In terms of value proposition, we believe our value proposition holds -- held steady throughout the pandemic because it's more focused on either discounts for one segment of clients or miles that can be used anywhere in e-commerce and in certain physical stores as well. So as some of the value propositions on many banks around the world were aimed at traveling and that value proposition clearly lost value during the pandemic, ours kept very strong and continues to be because it's focused on e-commerce. So in terms of the market, I believe we have become stronger in terms of portfolio, but also in terms of value proposition. That was the first part of the question. The second part of the question?

And the second part of the question was how are these credit cards customers being acquired? And it's mainly very similar to pre-pandemic as well. The banks have the lion's share of the credit card acquisition. Also the banks associated with retailers, which have their specific business model, and very little by, let's say, neobanks or fintechs specializing in credit cards. We're not seeing that yet in Peru. We know that will come at some point. The environment is challenging with increasing rates and the way that banks like ours or others in the system have been able to build digital solutions for credit cards, not only for selling credit cards but also for managing credit cards. However, we do recognize that there are some disruptions going around in the world, and we are getting ready to receive those types of players as well. But it's something that is not happening right now, where we know that will come in the future. I don't know, Carlos, if you want to complement something around that?

Last thing I want to say, I think Carlos asked if we see credit card customers separate from -- do you separate you customers? The answer is no. We look at the customer as Interbank customer. Obviously, credit card is what gives us a lot of engagement, that day to day. And we try to continue our engagement through our app, all of our other services, but we see a client 360 through Interbank. We obviously have a payment strategy in terms of what networks and how we do it, but the clients are the banks. So yes, and we have seen a large increase in cross-sell across our portfolio of clients in the last couple of years, particularly credit cards.

[Operator Instructions] We have no further questions via the phone. I would like to turn the conference back over to Mr. Ernesto Ferrero, Investor Relations Officer of Intercorp Financial Services, who will be reading additional questions from the chat.

Thank you. I will read our first webcast question. This is a question about Inteligo. Other income has been volatile lately and very relevant for results. Can you provide more color on how to understand it? Which markets and asset class explain most of it? It is mostly about rates in Peru, FX, U.S. stocks?

Okay. Thanks for that question. Obviously, Inteligo has a proven track record of bringing in very good results. However, it cannot go away from market conditions. And as you know, market conditions, specifically these last couple of quarters and what we're foreseeing, are complicated. So to answer that question let me pass it on to Bruno Ferreccio.

Thank you, Luis Felipe, and good morning. So a few things that hopefully can help you understand a little better the volatility on the results on the portfolio. First thing is, no, we're not subject to FX -- sorry, interest rate moves in Peru because our portfolio has no exposure to Peru. I do believe that Interseguro has some, and IFS already has some exposure to Peru. We look at our portfolio with a global view. So we have a diversified portfolio that invests globally. Within that, of course, the U.S. usually takes a good part of the weight on an investment portfolio. So yes, we would have U.S. exposure as well in there. So -- again, it's a diversified portfolio. We have fixed income equity and some alternative investments there, and as I was saying, with a global view. We also don't have exposure to FX. We basically do everything in U.S. dollars, and our portfolio has also invested 98% in U.S. dollars. So there might be a little bit of an FX exposure there, but it's minimal. So again, no Peru rates, no Peru exposure, global diversified view, but with probably a little more weight in the U.S., just I think it's pretty common for a diversified portfolio, investing with a global view.

Sure. Thanks, Bruno. But definitely for investment companies like Interseguro or Inteligo on that part of the business, it's a challenging times. And we do expect second quarter of this year to reflect that volatility.

Thank you. I'll move to our next question. This is quite a long question. My question is related to your medium-term ROE target vis-a-vis your plan to expand your customer base to 10 million customers from 5.6 million currently. You mentioned 18% ROE as your medium-term target, which is not very different from the number you have targeted in the past despite very ambitious goals in terms of increasing your client base. I imagine there are some trade-offs in your digital journey offsetting the benefit from increased operating leverage. Could you please walk us through those trade-offs? And those related to lower fee income ratio as existing clients migrate to free products, diminished risk-adjusted NIM as competition becomes stronger for -- in riskier segments or which other factors explain this? Also to the point above, I'm curious to understand how this increased client base would look like in terms of changes to your existing loan book in contributions by business units and on average, client profiles. Finally, do you have any time frame in mind to reach the 10 million customer milestone?

Okay. Thanks very much. Indeed, a long question. Let me take a crack at the overall and then maybe, Michela, you can help me complement. No -- yes, we're in a search of growth, but it's profitable growth. In the last couple of years, let's say, 3 years, we've already doubled our customer base from 2 million customers to -- 2-point-something million customers to 5-point-something million customers. So we have already done that. And we definitely did some trade-offs. Many of our digital services are free. For instance, we're the only bank in Peru that can do P2P transfers through the -- through the interbanking system. We're the only ones that do not charge and that has cost at all. We used to have north of 20% ROE. So the 18%, which is a mix of different things, obviously, because we run different businesses, already reflects those decisions that we have taken in order to be more appealable in terms of digital solutions. So what we expect is we're going to continue growing, our customer base, as I mentioned, probably in the medium term, let's say, 5 years get to those 10 million customers in the different businesses we have. Today, we have like 4 main pillars. As explained, we have universal banking, where we have retail customers. We have SMEs. We have corporate customers and growth is going to come from there. And the avenues will be bancarization and bringing some customers that prefer digital solutions that we are providing and leave other banks or financial companies to come with us. Then we have the insurance business, where we are developing also a digital strategy, and we are getting traction in getting more customers that we are able then to put into the IFS ecosystem and provide other types of financial services. But Interseguro is also bringing a good amount of clients and will contribute importantly to this goal. And obviously, Inteligo that, as Bruno mentioned, has now not only a very Peruvian focus in terms of getting customers but they're starting to take a look at the region overall, and that's going to be another source of customers. And fourth, we have the new payments pillar, which is Izipay that complemented with what we're doing with Tunki, another related solutions will also bring customers. So that's the way we plan to grow in terms of numbers of customers, and with value propositions that we already have in place with very much focused on profitability. So yes, there's going to be competition. There's going to be an adjustment in NIM. We're going to continue to do probably some trade-offs, but then we're going to have to tap new sources of revenue or make our data efforts so important that we're going to be able to provide value proposition to customers for certain services that they will be willing to pay for us. As you've seen, everything that we're doing has a clear monetization path or initiative. We are not in the game of let's grow and grow, and then we will see how we're going to monetize. We are in the game of every step we take has to come with a clear indication on what's the way to monetize the effort that we are doing. So basically, that's it. And we think that the benefit of scale will also allow us to improve our efficiency. We've been able to run very efficient operations with the scale we have, obviously double the scale will also allow us to get some synergies on the cost front as well that will enable us to target this aspirational 18% ROE that depending on the business combinations and how they evolve, we feel comfortable that, that's the right north to have. So basically, that's it from my side. Maybe Michela, you can complement?

Yes. I guess you have said it almost all already. But let me maybe guide you through some of the impacts on the P&L. There was a slide in the presentation where we tried to show you, like step by step, how are we already monetizing this growth, okay? And as Luis Felipe mentioned, this is something that we have already achieved from the 2-point-something million times to 5 million in these past 2, 3 years. So basically, first, I mean, we start from a position which is different from other banks. So for example, we have a very big upside potential in terms of cost of funds, so every client that we bring to IFS that brings deposits to IFS is something that for us is positive because we have been able to replace maybe some institutional deposits with low-cost, either retail or SME deposits. So this is like the first tangible source of monetization. The second one is that, as Luis Felipe mentioned, we were already not charging any fees for Interbank transactions within the platform. So for us, more clients is not something that is cannibalizing fees, but it is an opportunity because with those clients, we start to do some more businesses. So we start, for example, giving them a credit card, and they start using credit cards and their staff like using -- increasing turnover. So this is a big source of new fees for us. That is the same, for example, for trading, the FX, and also for insurance products. So it's a source of additional fee income for us. Then you also asked about risk-adjusted NIM and if we see that going down in the future. Even there -- I mean, first, we are in a moment of recovering of the risk-adjusted NIM that we used to have pre-COVID, and we are in a moment also of increasing interest rates. And basically, these new clients that we are bringing into IFS, I mean, we have different types of clients. Some are already bank clients coming from other banks and some clients are unbanked clients. So it is a mix that reflects more or less what we have already in the portfolio. And of course, we will be fine-tuning this portfolio mix to be in the risk appetite that we have for the bank itself. So as portfolio mix, which was I think part also of the question, we are still targeting a balanced portfolio mix like between 50% retail, 50% commercial, because also a big part of the growth that we are expecting in terms of clients is coming from merchant clients. So that would be on the commercial side part. So I guess as long as we continue to cross-sell those clients, we continue to increase revenues and decrease costs because we continue to close branches and have a more efficient acquisition cost and transactional costs, we will continue to see a positive operating leverage, which should help us to continue to have sustainable profitability in the future.

Yes. Maybe in summary, Interbank will continue on the emerging middle class, local corporates and enterprises, increase in SMEs and merchants. Then we go to Inteligo, emerging wealthy. That's very clear. That's a value proposition that we're bringing in. And in Interseguro, we'll continue to strengthen its annuities business and also complement that with retail insurance that can be distributed through the banks or through other partners. So the basic essence of how we build the business will continue in the future because we still see many opportunities in a country like ours.

Thank you. Moving to the next question. As mentioned at the beginning of your presentation, IFS targets to become 100% digital back. However, when looking to 100% digital banks in the region, they are targeting an efficiency ratio of between 20% and 25%. We see Interbank expects to maintain an efficiency ratio below 45%. Thus, it is feasible to see Interbank approach into the 20%, 25% efficiency ratio. When do you expect to operate 100% branchless?

Okay. Great question. Great, great question. Okay. So I don't have an answer for when do we expect Interbank to operate 100% branchless. What we are building is a little different approach. Every customer that wants to operate the Italy with Interbank will be able to operate the Italy with Interbank. Today, 65% of our customers are using Interbank that way. And branches have a role, it's transforming its role. It's more on the educational, advisory role. So we are optimizing that branch network. As I told you before, more than 40% has already been optimized. Probably there's more room but we don't have a specific target today of 0 branches for certain points because we do believe that there's a role for branches and maybe 100% of what they call the neobanks or the digital banks will have to complement the proposition that way. I think there's a piece of connection especially in latitudes like ours where the physical branch has a role different from today. We have to make sure it's very efficient. It serves its own specific purpose, probably much smaller and that's the route that we are going. And the efficiency ratio of 25%, haven't seen it in 100% digital banks, if you have the info, please send it to us because we are benchmarking a lot and we will love to see that because we obviously want to learn from the best. We're seeing neobanks struggling with generating profits and revenues still, although they're growing significantly because they have great value proposition and customers, so we would like to learn from that. But I think that scale and more efficient operations will allow us to reduce our efficiency ratio in an important manner. Before the pandemic, we were operating already at close to 35-plus percent, close to 40%. So we were like 4, 5 points below what we did. However, the pandemic changed a lot of our revenue-generating capabilities. And also, we had some regulation that came in affecting the credit card business that write off significant amount of fees. So we are rebuilding the business, and that's why we're showing those numbers, but we are very confident that we will be able to create a value proposition in terms of efficiency for the operation and for our customers that will allow us to compete with the best being incumbents or newcomers into our market. Michela?

Maybe just to complement very shortly. We have given a guidance for this year for IFS efficiency ratio to be between 35% and 37%, okay? But the medium-term target that we have for IFS is to be below 35%. And as you have seen from our business mix, I mean, the efficiency ratio of Interseguro and Inteligo are already very low. So the big part of the improvement that we are expecting in IFS efficiency ratio will be coming from banking as Luis Felipe already explained.

Thank you, Michela.

Thank you. The next question, how do you see the insurance businesses contributing to IFS going forward?

Okay. Well, that's a great question. Obviously, insurance is a key pillar for IFS, not only for the relevance that the business has already had, but also for the low penetration of insurance premiums measured however you want to measure it in terms of GDP per capita or whatnot. So there's tremendous opportunities in that market. But for more detail, let me pass it on to Gonzalo Basadre, who heads our insurance segment.

Great. Thanks, Luis Felipe. We consider that insurance complements very well with the other IFS businesses. Many of our clients are shared, and we think that we can even do a better job at increasing the penetration of Interbank clients to become also Interseguro's clients. In addition, Interbank is a distribution channel for some of our products. We sell to thousands of customers, insurance for credit card protection, health plans and different insurance products that provide a better value proposition to Interbank's customers.

Great. Thank you, Gonzalo.

Perfect. The following question, could you comment on their regulatory environment for payments? Are there any caps on fees? What has been the trend in pricing? And why did your partner Scotiabank leave the business? Additionally, what is the size of the market and growth potential? What are the main players in market share? Type of merchants that IFS will target to serve?

Okay. Great question on the -- I'm going to take the part of why Scotia, our partner, decided so -- I don't know really. Well, I think they -- the statement they made is that they were rationalizing their investments in the region and focusing in their areas of focus basically on their -- of core strengths and probably payments was not one of their priorities. So that's all what I have to say there. To go over the regulation and more detail on the payments landscape, let me pass it on to Carlos Tori.

Okay. Thank you, Luis Felipe, for the intro. In terms of regulations, there are a lot of regulations on the bank and how -- what you can charge with credit cards and what fees you can charge and what's top interest rate. As Luis Felipe mentioned a few minutes ago, during the pandemic, there was a new regulation that didn't allow us to charge for late payments. So there's a lot of relation in terms of that. In terms of acquiring business, it's just regular regulation like any other company. There is a lot of potential growth. We have seen a lot of growth in the last couple of years. The last 4 years, we have gone from having probably 150,000 merchants, that take credit cards, to over 1 million. That has happened in the last 3 years. So we've seen that. We believe that number could perfectly be 2 million or 3 million, okay? So that's one part of the growth. The other part of the growth is that we are seeing lots, not only more merchants that take cards, but the ecosystem is growing in terms of more people paying with cards and gaining advantage over cash. So there will be more transactions, both at the physical point of sale but also e-commerce, which is growing much faster. So there will be growth in the number of merchants and the number of transactions. Still, we believe the amount of payments that are done with cash in Peru are over 80%. So what you have seen is -- should be just the tip of the iceberg in terms of growth. So that's one part. Also, the kinds of services we can give to the merchant is also opportunity for growth. One obvious one is loans to merchants in the whole pyramid because you can go at the very top with corporate loans, middle SMEs and very small SMEs and micro merchants. So there's all of that scenario that there's growth. And then there's aggregated services that you can give to merchants. We recently announced this service that we're doing through Izipay that we're doing inventory management and charging solutions for our merchants, and we will continue to increment that in a couple of months. So there's a lot of opportunities for growth in different parts. In terms of competition, there's competition in every single segment that I mentioned. I do believe that Izipay right now is very strongly positioned. And we believe our market share in physical POS is very close to 50%. There are no official numbers, but in terms of the transactions that we see at Interbank, we believe we have 50% of physical. We have a lower market share in e-commerce but growing as well. And then -- the other large competitor is [ Nuvis ], which is an acquirer that is owned by several banks, including Interbank with a small position. And then there are new entrants, obviously, but at this point, much smaller. We will expect increased competition as well. But as I mentioned, we have a good starting point with a lot of avenues for growth. And also, we're starting from a point where we are profitable. We will invest in growth, but not at the expense of earnings. So that's kind of a summary. Sorry for the long response, but I wanted to be comprehensive.

No. Thanks very much, Carlos. And again, on the previous part of the question is for us, specifically, there's nothing better than a motivated buyer and a motivated seller. So we think that the transaction that we did with Izipay was very good for the IFS platform.

Thank you. We still have some more questions. Can you expand the strategy with the Rappi alliance? What is the target of clients, target of credit cards and loans that you want to achieve in the medium term, 2023, 2024? With the explanation of the digital strategy and how all the digital initiatives interconnect, it seems that the Rappi alliance is somehow outside the strong relation of other products and services. What does this alliance with Rappi offer?

Yes. Thank you very much. That's right. The Rappibank effort is separate from all where we're building and Interbank. That was always the idea of doing this type of digital bank outside of Interbank using the Rappibank opportunity or the platform because we believe that as in our core strategy, we need to be where the customer is. And Rappi digital solution brought us new separate idea to get over those preferences. However, that's still an early venture. It actually has a year of operations. We are still looking at the value proposition as mentioned in the previous conference call. It has not grown as expected. We are still pivoting, as usually happens in these types of ventures, trying to look to a model that is being able to be profitable and scalable. So we are still working on that. So it will be early to provide goals for the next couple of years because we are still, again, pivoting and working on the value proposition, testing it with different types of customers. What I can say -- tell you is that we are learning a lot, a lot from how native digital players operate. We are learning a lot about consumer behavior, their approach towards these types of new solutions. And that learning process enables us to fit back some of that knowledge into our own operations. So all in all, it's a positive experience so far, but very early in the game yet and still work to do in terms of understanding what is the right value proposition in order to make this profitable and scalable.

Thank you. We are moving on to Inteligo in the next question. Can you talk about the potential plans to expand at Inteligo? Could this be transformational? And which countries are you looking at?

Yes, let me take a first crack, and then I'll give it to Bruno. But Inteligo is exploring different alternatives within the value proposition that we have been able to build for the emerging wealthy in Peru is probably transferable to other kind of similar markets. And we are doing initial work on that front. So again, that's also -- it's very early, but I think that if willing to find the right drivers and execute it correctly, could be a transformation effort -- a transformational effort for Inteligo. I don't know, Bruno, if you want to complement something?

Yes, I think that, that's that pretty close to the answer. I would say it's early to name names. We haven't decided yet into which countries we would like to expand. But as Luis Felipe said, we believe that there are similar segments to the ones we serve for Peruvian clients in other countries, which are currently underserved and for which our value proposition is a great fit. So there -- again, with that in mind, looking at which countries would be good in terms of these segments and, as I mentioned, are underserved, those would be the ones that we would look to expand into first. So that's one part of the question. And I think the other part was in terms of, I believe, how transformational we thought it was. We're looking at this as diversifying our source of clients and our sources of revenues as well. So it certainly is something that we look at as growing at a decent pace, but it's not that we would expect to be, I don't know, 80% of our clients being non-Peruvian in 2 years. That's not how we're looking at this. We're looking at this as a clear approach step by step, 1 or 2 countries be successful there and then keep growing. So eventually, hopefully, I think we would expect something around 30% of our business to be outside of Peruvian clients. But that would probably, we think, take about 5 years. So it's -- we believe it's going to be, again, a measured process, I would say.

Thank you. Next question. From a regulatory perspective, can there be sharing of client data between the various businesses like bank, insurance, wealth, wallet, et cetera?

From a regulatory perspective, there can. There can be as long as the customers give their authorization for doing that. And that's the efforts that we're doing, obviously. We're very respectful of the law. We're very respectful of regulation. So the approach that we're taking is that we're getting the consent of customers in order to be able to use their information in different instances. However, we're very careful on that, and we are, again, very respectful. So probably we can do things much faster. However, this is one of the things that slow us down, but it's not going to be a trade-off for us, like circumventing that and not compliant with those types of regulation, it's not an option for them.

All right. We turn to Interseguro again. What is your view related to your proprietary portfolio at Interseguro, given current market conditions that are affecting every asset class?

Okay. For that, let me pass it on to Gonzalo.

Okay. As we mentioned before, this is a challenging year in terms of investment returns. Let me give you a brief summary of our portfolio, it's the different asset classes that made up our asset portfolio and understand what's the impact of market changes on it. First of all, around 80% of our portfolio is fixed income securities, and they match both in terms of currency and duration with our liabilities. And they are classified as whole to maturity. So there we will have much interest rate risk. We obviously face credit risk, but we feel very comfortable with the names we have in our portfolio. The remaining 20% is made up of -- on equal positions on real estate and equity. First, going to the real estate, we've recovered most of our revenues we generated before COVID. Some of our clients asked for a little bit of help on delaying some of the payments, but that has already been normalized and the revenue generation capacity of our real estate portfolio is back to normal. In terms of equity, this will be a challenging year, probably will lower the overall return of our portfolio. So from a target of 6% to 6.5% return, we should expect this year to have around 5%. That's our view on the performance of our portfolio for this year.

Okay. Thank you, Gonzalo. So definitely a challenging year for investments this year as we're seeing throughout the world.

All right. We have a question about the impact of the pension fund withdrawals and the possible changes on the pension system, both for Interseguro and for the bank. How far do you expect these changes to go?

Okay. Thank you. Well, there's a lot that have been done in the regulation in terms of pension funds. I think it has the dynamics of the pension fund system, which was something very good for Peru has been changed. It has been damaged, unfortunately. You've taken a long-term savings agent from the market. So definitely, the changes have not been positive. For the bank itself, you can see 2 ways. Some of those funds that have come out of the pension fund system have come to the bank. So we've grown deposits significantly. And we designed a strategy to get more than our natural market share. I think last night, I was looking at some numbers. And in the last round, we were getting around 20% of those funds coming out and we have a market share of like around 15% in retail savings. So you can see that as possible for the bank. But I don't like it for the country overall. I think it's a bad solution. And that also helps is that those funds go to pay some of outstanding loans or past due loans as well. We've seen that. That's why the PDL ratios in the past 24 months have been at a low level because some of those funds have been used to pay that. Once that goes away, probably we'll get to more normal ratios. For the insurance business, regulation already changed. Maybe Gonzalo can elaborate on that. But there was some regulation affecting the transition between the pension funds to the insurance business, that change the dynamics. And today, probably the effect is marginal, maybe some opportunities on private annuities. But maybe Gonzalo can elaborate a little bit more on that?

Sure. Our business was -- had a much stronger focus on annuities 5 years ago when the -- what we call the 95.5% law came into effect, which practically allowed any person who reached retirement age to just take their funds from the AFP and do whatever they want to do with their money, right? So from that time, practically, there are no longer any retirement annuities. The market for annuity is practically 100% composed of disability and survival benefits annuities, and that's what we have 30% market share and leader in that market. Some of the people who take their money out by private annuities without money, so that also has become a source of business for us. But any further regulations allowing more withdrawals from the AFP, I don't see any effect on our businesses.

Thank you, Gonzalo.

Thanks. Next question. My doubt is regarding Tunki, I just want to know if you see Yape as the main competitor of Tunki, or do you believe the focus and/or the market is different.

Okay. I'm going to pass it on to Carlos, but first, let me give you my view. The focus is definitely different. I give you like put some pressure on me, I will tell you that Yape, which is a very successful solution competed with our payment ecosystem strategy. Basically, that's the main vis-a-vis. Tunki is focused in a different market, has a different purpose and has the ability to connect the bank with the unbanked through PLIN including Interbank customers and other banks in the network. And so the focus is obviously kind of similar lower type of things they want to do. However, the strategic focus and the way we're deploying it is very different. But maybe Carlos can complement a little bit more around that concept?

No, I mean, that -- I think it was well explained. Yape is definitely a competitor for all -- the whole payments ecosystem across the board. Tunki serves a very specific segment of clients and has a very important role in connecting the bank and unbanked and has a reach that not only reaches Interbank clients, but all of PLIN, which includes other banks. They will compete at some point, and they do compete, but they don't have the same focus or segment right now. Yes.

And I think they're migrating the strategy, thinking about different things not only to be awarded and connected in financial services. So let's see how that plays out.

All right. I'll read the next question. Two questions. Can you comment on where do you see the growth of new clients to reach $10 million? And in what time frame? I guess we have already seen that. Can you comment on the growth of expectations of Izipay in terms of number of merchants and EBITDA in the next 2 or 3 years? Okay. Well, the first part of the question, we've already answered a couple of times. So let me pass it on straight to Izipay.

Yes. Yes. I mean Izipay, as I mentioned, we see several avenues of growth, loans, it's aggregated services, more merchants, more transactions. We have not -- we are not giving guidance on EBITDA. I have Michela looking at me with very interested eyes. So we're not going. But you're seeing the growth that we've seen in the past. It doesn't necessarily have to be like that in the future. But it's a strong company with a lot sort of opportunity ahead of it. Yes.

Next question is coming -- I guess there's no further questions at this time. Before I turn the floor back to Luis Felipe for closing remarks, I would like to ask you to please take a moment to answer a short survey about the event by accessing the QR code displayed on your screen and on the webcast tab. Your feedback is very important. Now Luis Felipe, the floor is yours.

Okay. Thanks, everyone. Thanks, everyone, for your participation in this session. Thanks for all your questions. Thanks for making sure that we can convey our messages. We hope that we have been able to convey our purpose, our vision, our strategy with clarity. We remain committed to make IFS a great company for the benefit of our customers, for the benefit of our employees, our partners and obviously of our investors and stakeholders. I want to thank the team at IFS for their hard work to do this today for their passion and for their commitment and what they do every day to make Peru a better country. Our IR team remains available for any further questions you might have. I am sure that we will connect soon. Good afternoon, and have a great day.