This shows a major development, and we’ve achieved this by reducing core costs, which grew by 1.6% in the year, well below inflation for the period. This is a trend we plan to continue working. We continue to actively work and invest in the business and in the future of our operation. This includes key investments in new businesses and technology, which explains the increase in the year, disregarding Latin America in this analysis. The guidance range for noninterest expenses was between 4% and 8%, and we remained within it by recording growth of 6.5% in the year. We have good news on capital. We were able to expand our capital ratio for another quarter, ending December with 15.2% in Tier 1 capital ratio, of which 13.7% at Common Equity tier 1 and 1.5% at AT1.
The last bar in this chart shows the pro forma capital for December 2023, considering the dividends that we just announced last night. We have two key messages on this. The first is that we are reporting material extraordinary dividend, amounting to R$ 11 billion, which will be paid in March along with interest on capital of R$ 4.3 billion that had already been announced, meaning there’s R$ 15.3 billion to be paid in March. This amount of interest on capital is already net of taxes. In 2023, we paid R$ 6.2 billion in interest on capital, also net of taxes. This totals the cash payment of R$ 21.5 billion in dividends and interest on capital in 2023. Thus, the payout for the year was 60.3%. Once this payment is made, the core capital ratio will be adjusted to 12.8%.
There are some uncertainties ahead of us, and that is why capital management discipline is needed to conduct our business. Now let’s move to the 2024 outlook. And I’ll start by sharing our macroeconomic projections. We expect Brazilian GDP to grow 1.8% in 2024, the interest rate, CELIC, to reach 9.0% at the end of the year and inflation 3.6%. And employment should be slightly stable at 8% and the exchange rate of R$ 4.9 to US$1 also slightly stable. I now present to you our consolidated 2024 guidance, which is based on a growth expectation between 6.5% and 9.5% for the loan portfolio and growth between 4.5% and 7.5% for the NII with clients. It’s worth noting that we also present the expected growth on a comparable basis, excluding the effect of the sale of the operation in Argentina in 2023.
With this adjustment, the expected growth for the NII with clients is between 5.5% and 8.5% on a comparable basis. The financial margin with a market should be between R$ 3 billion and R$ 5 billion. Our expectation for the cost of credit between R$ 33.5 billion and R$ 36.5 billion in 2024 reflects a major decrease when compared to the cost of credit in 2023, which was R$ 36.9 billion. Our worst case estimate for the cost of credit in 2024 is already nominally below the cost of credit in 2023. We tend to look for an even better result. Commissions and fees and results from insurance operations are expected to grow between 5% and 8% and between 5.5% and 8.5% on a comparable basis, with a pro forma adjustment from the sale of Banco Itaú Argentina.
Noninterest expense is expected to grow between 4% and 7% is adjusted for the same effect on a comparable basis. Growth is between 5% and 8%. The goal is core costs to grow below inflation so that we can continue to invest in our operations. The tax rate is expected to be between 29.5% and 31.5%. Our goal is to keep delivering ROE above 20%, and these figures reflect that goal. I’m very pleased with the earnings achieved in 2023, the course that the bank has followed and the way we have mobilized, advanced and invested in the business. Cultural transformation has had a very material impact. Digital transformation is materialized in several of the figures we presented today. There are challenges ahead. No one is being complacent. On the contrary, we are very focused on delivering even stronger earnings in 2024, as shown in our guidance.
Now I’ll be joining Renato for our traditional Q&A session. See you in a little while. And thank you very much.
Renato Lulia: Milton, thank you for the presentation. We will start now the Q&A session. And today we have besides Milton, we have Broedel, he’s, our CFO. He’s going to be here with us in the Q&A session. Remember that we have both languages. We will answer the question in English and Portuguese. You can always choose your audio of preference, English or Portuguese. You can submit your questions via WhatsApp. Well, there is a long list of questions. Milton and Alexsandro Lopes, shall we start?
Operator: [Operator Instructions]
Renato Lulia : Yes. Good morning. First question we have on screen, Renato Meloni, Autonomous.
Renato Meloni: Thank you. Good morning. Thank you for the opportunity. First, in regards to the guidance, when you look at the interval that you’re mentioning, the growth in the portfolio of credit and a margin of clients, then might be a reduction, might imply in reduction. Is that a real thing? Because the — there is an expectation of the stabilization for 2024. And how should you or how are you looking at the dividends? And as here, if the growth in the portfolio goes to 9.5% can we have a similar payout? Any additional comments are great.
Milton Filho: Thank you, Renato. Good morning. Thank you for the question. Let’s clarify the guidance of the portfolio. First message. Portfolio of the guidance is, let’s just say, the tip of the portfolio and the margin is the one that we realized. That means that the average portfolio all throughout 2024 and the information is not in the guidance, it will be lower than the financial margin with the client. So we have to look at the average of the portfolio because that’s the margin that you can see in the guidance. That’s the first aspect, second aspect. When we look at the records, we’ve been growing with a lot of quality, the margin. And it’s important to look at the margin, not only associated with the Argentina effect, which explains another percentage point of growth.
So isolating it, we would grow seven percentage point on average. It’s important to consider the cost of credit, which has a nominal reduction. That means that our financial margin net cost of credit will have an expansion. Portfolio growing, cost of credit shopping. And you asked about the NIN. We are expecting, yes, stability of throughout the year and adjusted to the risk. We understand that there is an opportunity for some adjustments through the credit cycle. That depends on the mix of the growth of the portfolio that you can see here. That is growing above the average payout of the portfolio in the period. The cost of credit is higher and adjusted by the Argentina effect growing by 7%. Very important to clarify the dividends. That is of interest of everyone.
What was our decision? Let’s turn back time. Way back when we reduced our appetite in the risk management of the bank, we always talked about 11.5 that’s the set of the capital, approved at the board. That’s the appetite for the management of the bank. And we said that 12 would be the observed for the policy of dividends. And we look up ahead. There are some uncertainties or certainties that are calculated. The cost of credit, Basel. Operational credit, Basel III, 2025. That might have an impact of 42 basis points. And there is a second aspect, the tax reform of Brazil. If we look at it as it is in Congress, as if it was approved as it was written, we will have to do an impairment in the credit because when we look at the corporate threshold, we will have to reevaluate them in the balance sheet of the bank.
That reevaluation, even the corporate threshold, is evaluated, you reduce an asset, and then you have a capital effect. When you look up ahead, the uncertainties, our capacity for growth, we are getting into a year that we expect to be benign and any opportunity that might make sense through the cycle we will grow. So considering the growth of the portfolio, considering what’s up ahead Basel operational risk, credit risk, and considering the tax reform and uncertainties, our decision is to do the payout that is added to what was already paid, or R$ 4.3, which is the interest on capital, in March plus the extraordinary dividends. So a payout of 60%, we understand that it’s adequate, we are distributing R$ 21.5 billion between what was already paid and what will be paid in March.
