Neha Agarwala: Okay. Perfect. So first question is on the credit cards. I noticed that the Stage 3 loans for credit cards has continued to rise for the last few quarters and increased from 7.7% last quarter to 8.1% this quarter. While the cost of risk for credit cards as such has continued to decline quarter-on-quarter. So could you explain that dynamic why the cost of risk is declining and the Stage 3 loans continue to increase? My second question is on capital. I noticed the increase in the RWA and that the Basel ratio has halved to almost 11%, now. Given the large increase of the RWAs, do you see the need of, say, sending some capital to Brazil in next year, or do you think the profit that is generated in Brazil be sufficient to meet the capital requirements? Any color on that? And lastly and I know this is something which, we don’t have much clarity on today, but, any update or any news on the, pending credit card regulation would be very helpful?
David Velez: Thank you so much for your questions. Let me try to start from the last one and then we’ll bring forward. So on the credit card, industrial regulation. So, those continue to be ongoing discussions Involved in multiple parties of the credit card industry, both issuers, acquirers, versions, consumers, and the Brazilian Central Bank and the Ministry of Finance and soon the Ministry of Planning as well. We have been an active participant in those discussions and we believe we have the unique opportunity to promote more ambitious and positive or overhaul in how credit cards created in Brazil. And, we are very encouraged by the less discussions that we have had with the parties. And we believe that we will probably have more clarity about assets when we have our next earnings call.
Very soon for us to actually draw any high conviction outlook on how this will unfold. But we are working very hard together with the industry and the regulator to have a positive outcome that allows us to have a much more balanced product going forward. To your second question, I think you related to the increase in capital. I believe it’s important to highlight that in 2022, the Brazilian Central Bank put forward a new regulation which is usually referred to as Resolution 200, which basically harmonize the capital regulations of payment institutions and financial institutions. And as a result of that, as you can see on Section 32 of our financial statements, You will note that the Brazilian Central Bank has enacted a gradual implementation of this new norm, whereby the minimum capital the occupancy ratio starts at 6.75% in 2022, goes to 8.75% in 2024, and then finally to 10.5% in 2025.
And also payment institutions that control financial conglomerates we’ll now have to report consolidated capital adequacy ratios. The result of all that is that we have a capital adequacy ratio in Brazil of 11%. Whereas the minimum capital requirements today, it’s 6.75%. So we have a fairly relevant buffer in Brazil. And in addition to that, we have $2.3 billion of excess liquidity at our holding company. So we are super comfortable. It’s unclear to us whether we will ever need to capitalize our Brazilian entities going forward. It will largely depend on the growth base of our credit book. But we are very comfortable that with the business plans that we have for Brazil, Mexico, and Colombia. Those are fully funded and fully capitalized. And the areas that we generate in Brazil plus the excess capital that we have in the whole company will more than suffice to fund all of this plan for the next, for the foreseeable future.
Youssef Lahrech: So with respect to your first question on what is going on in the dynamics of the various stages, and provisioning. I would refer you to note 13 in our financial statements, which contains all the breakdowns and the details stage by stage. You can look at coverage ratios and the migration across buckets. But overall, I would summarize it just very simply by saying that, stage 3 tends to largely correlate with 90 plus, past due delinquency rates. So it kind of mirrors what is going on there? And as I mentioned earlier in the call, as we write-off credit card loans, in our Brazil credit card portfolio at 360 days, what tends to happen is you enter a 90 plus and then for several months those loans accumulate. And as they accumulate, and go further and further in the delinquency stages, what tends to happen is coverage ratio increases, and so you see just those mechanics playing up.
Jorg Friedemann: And our next question comes to the line of Yuri Fernandes at JPMorgan.
Yuri Fernandes: I have a question on fees. We see interchange is still the 75% of your total fees, but we don’t see other fees growing. And you have many initiatives. You have the investment platform. You have the insurance. You have the program of need, of those cost. When should we see the fee line growing? Because the interchange are growing, but it’s growing like 25%, 26% year-over-year, And we still don’t see. So just trying to get your expectations on those loan credit related business?
Guilherme Lago: Look, we do have this portfolio of business throughout the company, which we classify in 3 archetypes. We have the anchor business, the growth business, and the moonshots. And the anchor business, which we classify as the credit card, lending, and our banking account, are doing extremely well. And their profitability is basically overshadowing the very positive results and performance that we are having in more emerging business. But you pointed out to some of the business that we have today that are actually performing fairly well. I would highlight the investment business whose assets have increased by over 50% over the past 12 months. Number of customers have doubled. So we do expect that over the coming 4 to 8 quarters, we will have much more visibility on the more growth and moonshot business that will progressively emerge into our new anchor business of the next now 3 to 5 years.
