Secondly, in regards to that ROE expectations that you mentioned. I would just say it again, I want to just promise things. I want to deliver. As soon as I can deliver, we will deliver to expectations, and that’s what we intend to do, to deliver things as time goes by. And the other question was about client NII. How do we expedite that? I mean, we accelerate through growing our loan portfolio. And during my presentation, I said that, okay, we gained market share in February. In January, we did not gain share. So, we had to move faster in February, which we did. So, I’m firmly believe that we will gain share in March. In April, that’s when we will see what has been done. I mean that NII, things will not happen overnight. First, we will see a growth in the portfolio and then we will see an increase in our net margin because the bottom-line is that delinquency is under control.
We are bringing good quality things to our portfolio, and that’s when we will see a growth in NII, an effective growth in NII. So, you might recall that I’m talking about two different types of portfolios and two different types of risk acceptance. This will require additional effort on the part of the bank. I don’t know whether you would like to mention it. I mean, the client NII will be better in the second quarter vis-a-vis the first quarter because there is a gradual evolution. First quarter lower ALL and then retrying the margin we grow with ALL because we will go through more risky segments. And our funding cost is coming down as well. This is what we are noticing. And this has an impact in the timeline.
Operator: The next question comes from Brian Flores from Citi.
Brian Flores: Thank you, for taking my question. With a more restrictive Central Bank and you talked about funding, how does that change funding? And also talking about market NII. What is your view about market NII?
Unidentified Company Representative : Hi. It’s a pleasure to see you. In terms of market NII, I would say that we don’t see any major changes through this year. There was a light drop, you know, from one quarter to the next and the Central Bank with a more restrictive curve. But that tilted curve, as we say, it is very important for our prefixed portfolio because it brings a more interesting fee volume. And we believe that even though the landscape is more restrictive, it points to decline in interest rates because 9.5% or 10%. That is not very significant because it doesn’t change the landscape as much in terms of our treasury position. Therefore, we see this as something beneficial because on the one hand, we reinstate our loan portfolio with higher rates.
So, in terms of the cycle as a whole, the cycle would indicate into 9.5% to 10%. Our economists points to 9.25%. I don’t believe in a cycle where interest rates will spike after that. So, this scenario will bring about good results and the market is performing well pretty much along the lines that we mentioned before, which is positive and we see a positive trend towards 2025. Just to reinstate what he said, the expectation is that the market is very bullish from now on. And the fact that the rate will come down 50 basis points or 25 basis points, nothing much will change.
Operator: Jorge Kuri with Morgan Stanley.
Jorge Kuri: Possibility to ask questions. I think that the positive highlight that the quarter was improved credit quality since they are very confident to accelerate growth in those owns with higher spread. The question is, is the bank ready to some of it maintaining NTL under control protect the takeway in retail. Why we need the main adjustments Centrobank in terms of processes, credit [indiscernible], what were the main steps for [indiscernible]? If you can latest standpoint. That would be helpful. Thank you.
Unidentified Company Representative: Thank you for the question. As I mentioned during the presentation, we have been using a lot more machine learning than in the past exactly to improve our modeling. So, from a qualitative standpoint, if and then you were sitting here, people tell you exactly about it, so that’s number one. Number two, we work on all credit cards [indiscernible] credit ratings that are higher risks. Now, I have a policy in place, which is a lot more intuitive than in the past. When we talk about the proportion, of the income proportion of company or SME revenue. What kind of proportion that you want to have in legal entities. So what kind of quota do you want to have and what kind of loan. Improved to our policy or what and it will improve even more when you get this joints is make sure there is to manage the portfolio with pricing.
With pricing, we have pricing for product. And now pricing is in the study department. improving our value proposition, that was an important structural change so that we could adequately price alone and adjust the levels of approval. But in mass market, I’d say that this is it. New credit policies, new credit models with a collection process which is very fine-tuned and a leaving portfolio management, which is what we do now. Then gives us greater safety regarding everything we are seeing. We define the indicators that we are measuring strictly. We are measuring them full time and also in the wholesale bank, we made some changes. We hired other people. It was not just one officer. We brought in teams for the credit department. We’re still hiring more people and we changed some processes so that we could have a lot more agility in serving legal entities.
I’m talking about all the way from large corporates down to middle income and SMEs. So, with that, we have a much more productive organization than we had recently, and our managers feel that. If you speak with our regional managers [indiscernible] and these controls that are now in place, please remember that in the business unit, with this portfolio management department. We have to foreseen second line of defense. We have colleagues in charge of modeling and for colleague, whom check the modeling and validate the modeling, we’ve got [indiscernible] control department. So, what I can tell this, I mean of course, again not going to be within with that ratio for the vintages, but a little higher, which is the optimal point. Report dear management is the economic return of each holistic appliance, so that we can work with the bottom-line without a good pricing.
