Banco Santander-Chile (NYSE:BSAC) Q2 2023 Earnings Conference Call August 4, 2023 11:00 AM ET

Corporate Participants

Emiliano Muratore - Chief Financial Officer

Claudio Soto - Chief Economist

Cristian Vicuna - Chief of Strategic Planning and Investor Relations

Conference Call Participants

Juan Recalde - Scotiabank

Ernesto Gabilondo - Bank of America

Tito Labarta - Goldman Sachs

Daniel Mora Ardila - CrediCorp Capital

Isabelle Irish - Baring Asset Management

Neha Agarwala - HSBC Global Research

Ewald Stark Bittencourt - BICE Inversiones

Operator

Hello and welcome to Banco Santander-Chile's Second Quarter 2023 Results Conference Call. We are joined today by the CFO, Emiliano Muratore; Chief Strategic Planning and Head of IR, Cristian Vicuna; and Chief Economist, Claudio Soto.

I'll now hand the line over to Emiliano to begin the presentation. Please go ahead, sir.

Emiliano Muratore

Good morning, everyone. Welcome to Banco Santander-Chile's second quarter 2023 results webcast and conference call. This is Emiliano Muratore, CFO, and I'm joined today by Cristian Vicuna, Chief of Strategic Planning and Investor Relations; and Claudio Soto, Chief Economist.

Thank you for attending today's conference call. Today, we will be discussing the trends and results of the second quarter. I am pleased to share that our digital strategy and customer-centric product offerings have been instrumental in driving robust results across all business segments, particularly witnessing exceptional growth in non-NII revenues.

In addition to this success, our relentless focus on cost discipline has allowed us to partially offset the NII pressures arising from the non-clients NIM during this period of lower inflation and high rates.

Looking ahead, we are optimistic about the benefits our well-positioned balance sheet will reap from the Chilean Central Bank easing cycle of interest rates, which commenced last week. This shift is anticipated to trigger a significant recovery in our NIMs and we expect this positive impact to manifest in the final months of this year.

To begin, I invite Claudio Soto to give us an update on the macro scenario, beginning on slide five.

Claudio Soto

Thank you, Emiliano. During the second quarter, economic activity contracted significantly due to continued tight financial conditions and less favorable external conditions for the country.

Also, a poor mining performance affected by the delay of large investment projects had an impact on activity. In the coming months, we will continue to see a weak economy, with consumption falling at significant rates and low investment. Based on the information available, we have revised downward our activity estimate for this year from minus 0.75% to minus 1%. However, next year, the economy should rebound and grow at around 2%.