Ernesto Gabilondo: No, no, very interesting, very interesting, Jorge. Just a follow-up on this related to your exposure to dual bonds and dollar-linked bonds. And so, how are you thinking for next year? Because we have seen that most of the banks have benefited because they have not been lending and they have been using this excess liquidity into these securities. So thinking that next year could be more challenging. And actually, in this quarter, we saw a lot of volatility. You did very well in terms of FX gains, but we have some losses in the security. So how should we think about this? Or how should we think about the sensitivity, which are the variables that we will have to be looking in the next quarters?
Jorge Francisco Scarinci: Yes, I mean you’re right. In the third quarter, there were some declining prices basically on the dual bonds and dollar-linked bonds as a consequence of some statements made by Milei at that time. However, what we are seeing in the fourth quarter is a big recovery in the prices of these bonds. And nowadays the markets continue showing some hedge against the potential devaluation of the official effects. So the fourth quarter performance on these bonds is looking very good. Honestly, this is a way that we have been mentioning these many times that this is a way of hedging the equity of the bank since banks cannot be long in dollars. So we found this as another way of protecting the equity of the bank.
For next year, I think that conditions might change depending on how the market evolves, how inflation expectations are for the second half. If expectations for inflations decline, this could bring — and of course, in — hand-in-hand with the decline of nominal rates, this would bring additional loan demand. But again, this, if happens, is going to happen by the end of 2024. So I think that next year should be challenging, and at some point banks would have to see where to allocate the excess liquidity. And in the case of Banco Macro, as we have been proving in last years, we always try to allocate excess liquidity in profitable assets with a risk-reward equation to be positive for the bank, always looking at profitability, solvency and liquidity.
So that’s the idea, Ernesto.
Ernesto Gabilondo: Excellent, excellent, Jorge. And just last question on how do you see the ROE for this and for next year?
Jorge Francisco Scarinci: I mean for this year, well, the fourth quarter is not closed yet. We might see something in the area of high-teens or maybe close to 12% depending on the evolution of bond prices, so in that area. For next year, tougher to forecast. Let’s assume that we are working with a scenario of between 10% to 15% in real terms.
Ernesto Gabilondo: Perfect, perfect. Thank you very much.
Jorge Francisco Scarinci: Welcome, Ernesto.
Operator: The next question is from Brian Flores with Citibank. Please go ahead.
Brian Flores: Hi, team. Thank you for the opportunity to ask questions. I have two questions. The first one is on the strategic rationale of deposits. We saw, contrary maybe to some of your peers, a shrinkage in deposits on a quarter-on-quarter basis. So just wanted to understand what is your rationale behind this? That is my first question. And then on the second question, we saw some effects on the effective tax rate. I think your notes were very clear. But just, I was wondering if these effects are recurring in nature, we should see something more for the remainder of the year. Any other insight here is very helpful. Thank you.
Jorge Francisco Scarinci: Hi, Brian. How are you? Let’s start with the second question. In terms of the taxes, I mean, if you look at the ninth-month income tax rate, it is 35%. Basically, it was slightly below in the first two quarters. And basically the third quarter we are catching up in order to reach the 35% income tax statutory rate that we have here in Argentina. In terms of your first quarter, the behavior of deposit is relate to — sorry, related to what I mentioned in to Ernesto’s questioning, I mean, we decided at some point to reduce some institutional deposits in the strategy of reducing the allocation of assets and exposure to the Central Bank, basically because we decided to pay lower interest rate to those depositors that they moved to other banks. That is the main reason for that.
Brian Flores: Okay, perfect. And then just to confirm, I didn’t hear very clearly. You were speaking about ROE for next year between 12% and 15%. Is this correct?
Jorge Francisco Scarinci: Yes, that is correct. Again, very preliminary estimates because, of course, next year is going to be important year in sense of we are going to have new President, new economic cabinet, new measures. So as of today, we are working with that scenario. That could change at the beginning of 2024 depending on the measures and, of course the outcome that economists might be looking for in terms of inflation, GDP, et cetera.
Brian Flores: Perfect. Super clear. Thank you.
Jorge Francisco Scarinci: Welcome.
Operator: The next question is from Nicolas Riva with Bank of America. Please go ahead.
Nicolas Riva: Thanks very much, Nicolas and Jorge, for the chance to ask questions. So Jorge, I want to circle back on kind of the prior question — the initial question that, well, Ernesto made multiple questions. But one of the topics that he wanted to discuss was Leliqs exposure. So and in this case, really talking about Banco Macro, but, you know, as a CFO of one of the largest banks, if you can provide some insights into, at this point, what do you think is the new administration’s plan for the Leliqs? Because it seems to mean, right, but, you know, you’re talking based on what I see here from New York, would be that the market solution that the new administration is talking about could be exchanging the stock of Leliqs for longer-term government bonds.
