Carlos Gomez: Okay. And I think my other question was in terms of, in actual numbers, well, yes, there is a lot of potential for growth. How much would you expect your portfolio to grow again, not only ’24, but also ’25, ’26?
Michela Casassa: In that specific segment sorry or overall?
Carlos Gomez: Both.
Michela Casassa: Okay. No, I mean, the guidance that we are giving for total loan growth for next year is mid-single digit. Okay. Actually, we are expecting a little bit higher increase in loans in commercial banking and a little bit lower in retail banking, because still the consumer portfolio will grow marginally, we believe.
Carlos Gomez: Thank you so much.
Operator: At this time, we’ll take the webcast questions. I would now like to turn the call over to InspIR Group. Please go ahead.
Valentina Porto: Thank you, operator. The first question comes from Daniel Mora of Credicorp. In 2024, can we expect a stable NIM given that with the increases in rates it remains stable at 5.5?
Michela Casassa: Let me take that. Daniel, thank you for your question. I guess we commented that before. Yes, we are providing guidance for a stable NIM which is the result of decreasing cost of funds from the cuts in soles rates, but also some pressure in the yield on loans due to the portfolio mix and its evolution.
Valentina Porto: Thank you. And as a follow up to that, when do you expect to reach the peak in provisions and the peak in non-performing loans?
Michela Casassa: Peak in provisions? I mean, we believe that the high quarters have been already the third and fourth quarter, but the first quarter, 2024, is still going to be a high cost of risk for the consumer portfolio. After that, we expect cost of risk to start to go down and eventually normalize in the coming quarters.
Valentina Porto: The next question comes from Nancy Lopez of UP (ph). What was the main trigger of a change on retail loans to a more expensive maintenance ones?
Michela Casassa: Can you read it again? Sorry.
Valentina Porto: What was the trigger — the main trigger on retail loans to more expensive maintenance ones?
Michela Casassa: To more expensive maintenance ones? Is that the question?
Valentina Porto: Yes.
Michela Casassa: I mean, maybe if I can comment on the portfolio mix. What has been happening in the past two quarters is that consumer loans, the unsecured portion, has been decreasing because of the risk profile. That is the main reason why, while we have seen a continuous growth in mortgages, in payroll deductible loans to the public sector employees, and also in commercial banking.
Valentina Porto: The next question comes from Daniel Merida of PUCP. Good morning. Thanks for the presentation. Can you please give an update about your buyback program?
Michela Casassa: Sure. The buyback program was put on hold a few months ago. Actually, after the latest update that we gave during, I think it was three quarters ago, we have not pursued any additional purchases and it is in kind of a wait-and-see position, given that we are now focusing more on maintaining the capital levels, given the macro outlook that changed not dramatically during the last half of 2023.
Valentina Porto: The next question comes from Ernesto Gabilondo of Bank of America. How should we think about the dividend payout ratio this year?
Luis Felipe Castellanos: Hi, Ernesto. I think you can hear me now. I’m sorry, I had some problem with my microphone. Well, it’s basically our policy. You’ll have to take into account 45% of the bank and I think, like 50% of the insurance company and a bit of the Inteligo, which results are not very high. Then we take some cash into the operating company to — sorry, into the holding company in order to cover expenses and debt service. So it should be — I think we’re announcing it pretty soon. So you can work through the numbers. I don’t know if we can tell the number right now. We still have to go through the process of IFS Board and shareholders meeting in order to approve it. And — but that’s the way we build up our dividends. And it’s based, remember, on local government. So I worked through the numbers, but it’s too early to actually mention it. But probably we will have a dividend. So that’s good news.
Valentina Porto: At this time, there are no further questions. I’d like to turn the call over to the operator.
Operator: Thank you. There appear to be no further questions at this time as well on the audio side. I would like to turn the floor back over to Ms. Casassa for any closing remarks. Please go ahead.
Michela Casassa: Okay. Thank you very much. Thank you, everybody, again for attending our call and for the questions. And we’ll see each other again for our first quarter results. Thanks again. Bye-bye.
Operator: This concludes today’s conference call. You may now disconnect.
