Thank you very much. Welcome everybody.

Thank you for joining our Q2 results call. If you could please turn to page 3, where we talk a bit about the highlights of the quarter.

Once again, we were able to finish the quarter with record revenues and delivering record results, a record net income, benefiting from the efficiency gains of the integrated business now with Banco Pan, resulting on a return on equity of 26.7%. Once again, I think this highlights our ability to capture opportunities across different macro cycles and different environments.

Moving to the second bullet point, corporate lending and business banking had another record quarter, increasing 19% year-over-year in revenues, keeping healthy spreads and disciplined asset origination. I think here, once again, we are reaping the benefits of our disciplined capital allocation strategy, which is not based on market share or share of wallet, but is based on making sure that the spreads, in our view, are correctly priced for the unit of risk, and also benefiting from our continued increase in geographical diversification and segment diversification as we continue to penetrate the new segments that we have been building out over the last few years.

Moving to the third bullet point, in sales and trading, were able to deliver consistent performance, despite a very challenging macro environment in the second quarter, different than what happened in the first two months of the year, where we were able to offset slower, softer client activity with very efficient capital allocation in the balance sheet. Moving to the fourth point, asset and wealth management continue to scale.

We had 59 billion in net new money in the quarter and pushing our combined AUM and wealth under management to R$2.7 trillion. Finally, the fifth bullet point, our consumer finance and banking division grew 37% year-over-year.

This was mainly driven by the results from Banco Pan, but also we had contributions from our partnership with Meu Tudo. Here in Banco Pan, we're benefiting from the integration of the back office and controls, thus not only with efficiency gains, but what we believe is a 100% BTG Pactual culture now in our consumer finance business, as we're also reaping the benefits from the change in strategy and leadership that we did within the consumer finance business in the last, if I'm not mistaken, 18 to 24 months.

Moving to page 4, we talk a bit about the highlights of the numbers. We had total revenues reaching R$10.4 billion, this is a 16% growth year-over-year, and net income reaching R$5.1 billion, 23% growth year-over-year, once again showing our efficiency gains and operating leverage in the platform.

We finished the quarter with a return on equity of 26.7%. Turning to page 5, once again, as mentioned previously, we had R$59 billion in net new money, roughly half asset management, half wealth management.

Our assets in wealth management grew 24% to R$1.314 trillion, and our assets in asset management grew 25% to R$1.361 trillion. Moving to page 6, our unsecured funding grew 32% year-over-year, reaching R$405 billion, very conservative capital ratio of 16%, and net equity reaching R$80 billion at the end of the quarter.

Finally, our credit portfolio grew 24% year-over-year, reaching R$367 billion, 288 in the corporate and SME segment, and 78 billion in the consumer finance sector. In page 7, we show the numbers in a traditional manner that we've always done for the last, I don't know, over a decade.

Total revenues reached R$10.4 billion, adjusted net income of 5.14, net income per unit of 1.33, cost-income ratio moving down to 37.1 from 38.5 at the end of last year, showing the improvement in operating leverage. Total assets reached R$925 billion for equity of 80 billion, and had an average VaR for the quarter of 22 bps.

On page 8, we show the results for the first half of the year, where we had an increase in the net income year-over-year of 31%. Net income for the first six months of the year was R$20.3 billion, net income of roughly R$10 billion, return on equity 26.6, and net income per unit of R$2.58.

Once again, similar cost-income ratio, 37.6, and a slightly higher VaR of 27 bps for the first half of the year. On page 9, last quarter, we showed Q1 versus Q1, now we show first half versus first half, the revenue breakdown of the different business units.

Here, we're basically in investment banking, we see the tougher market. In the first half of the year, 10% reduction from the first half of last year.

Corporate lending and business banking, a very healthy growth of 20% year-over-year. The same for sales and trading, 16% growth, despite a tougher quarter this quarter.

Asset management growing 16%, wealth management a very strong 30%, and consumer finance and banking, an extremely healthy 58%. Also, interest and other, continuing to grow 35%, which is a reflection of the very solid balance sheet that we have and the very high interest rate environment that we're currently living.

When you see the breakdown per business unit, we continue to see increased diversification and a very healthy distribution across what we can call corporate and investment banking, with roughly 29%, sales and trading or markets related 18%, investment management 23%, and consumer finance 13%. Probably over the next few years, we will probably continue to see a growth in investment management as a percentage of total businesses and a growth in consumer finance as a percentage of the total businesses.

With that, I'll pass the floor to Cohn, and then we can go to Q&A.

Thank you, Roberto, and good morning, everyone. Starting with our specific business lines on page 11, we see our investment bank, where we had resilient performance, despite the challenging ECM environment, with ECM and M&A delivering positive contributions across Brazil and Latin America.

Here, we recorded revenues of R$421 million during the quarter. That's a decrease when we compare to the previous quarter, mostly again as a consequence of softer DCM activity throughout the quarter.

As by the end of the first quarter of '26, we saw widening of credit spreads in the secondary market, which caused some redemptions in some credit-related fixed income funds, and consequently, little appetite for new placements in DCM market. By the middle of the second quarter, we saw credit spreads stabilizing, and in some cases, started to tighten.

We see redemptions normalizing, and by the end of second quarter, we started to see an improvement of issuances, pointing to a stronger pipeline for the third quarter of '26. Both ECM and M&A remained as active contributors in similar amounts as previous quarters, with transactions executed both in Brazil and in Latin America.

During the quarter, we acted as the sole Latin America underwriter in SpaceX landmark IPO, which was the largest equity offering in history, reinforcing BTG's standing as the leading Latin America partner for global transactions. Moving now to corporate lending and business banking, on page 12, we see that we had record results, with 19% revenue growth, maintaining healthy spreads and disciplined asset origination.

Revenues reached R$2.5 billion, which is a 7.2% increase when we compare to the previous quarter, and again, 19% when we compare to the second quarter of '25, as we continue to expand our portfolio in different segments, different geographies. We continue to expand our international portfolio, maintaining healthy spreads, showing once again this trend of our business and also improved funding structure.

Total corporate portfolio grew 2.6% during the quarter and 21% when we compare to the second quarter of '25, reaching a total of R$288.5 billion. Large corporate and corporate book grew 5.5%, while SME portfolio contracted, reflecting a more disciplined risk-adjusted capital allocation across all corporate lending segments.

For the third year in a row, we were recognized by Euromoney as the best bank for SMEs in Brazil, reflecting the quality and strength of our digital banking platform for entrepreneurs and businesses. If we go now to page 13, we see our sales and trading business line, where we showed once again resilient performance, despite the challenging macroeconomic environment, with a more efficient risk allocation offsetting softer client activity.

Revenues reached R$1.858 billion, mostly stable when we compare to the previous quarter, and that came again as a consequence of slower client activity, reflecting still high uncertainties and volatility related to the geopolitical and macroeconomic scenario. As we mentioned, despite the lower client activity, we managed to keep similar revenues as previous quarter, with an improved risk allocation, which can be seen by the significant reduction in the average VaR from the previous quarter, when it was 32 basis points, and we see here that the average VaR during the second quarter was 22 basis points, a significant reduction here.

Overall, this was our best first half, with revenues reaching R$3.7 billion. That's a 16% increase when we compare to the first half of '25, as we continue the process of expanding our client base and widening the range of products and services that we offer to our client base.

During the quarter, we're voted once again best research, sales, trading, and corporate access in Latin America, and best research and trading house in Brazil for institutional investor. Moving now to page 14, we look at our asset management business line, where we can see that we had also resilient net inflows with consistently growing management fee revenues.

Revenues reached R$794 million, which is a 1.3% increase during the quarter and a 27% increase when we compare to the second quarter of '25, as management fees revenues continued to grow alongside the expansion of assets under management and administration. Assets under management and administration reached R$1.361 trillion, which represents a 3.5% increase during the quarter and a 25% growth when we compare to the second quarter of '25.

We recorded positive net new money of R$29.4 billion during the quarter. That's a good number, especially considering the challenging environment that the asset management industry is experiencing in recent quarters, with the fund industry experiencing net redemptions during this quarter.

We recorded positive inflows in both our asset servicing and in our managed fund businesses, as we continue to gain market share. We go now to our wealth management and personal banking business line, on page 15, we see that our total wealth under management passed the R$1.3 trillion mark, with strong net inflows during the quarter.

We recorded revenues of R$1.447 billion, which is a 4.5% decrease when we compare to the previous quarter, which was marked by very strong levels of client activity. When we compare to the second quarter of '25, we see a 17% increase in revenues, with revenues growing alongside portfolio expansion.

As mentioned, wealth under management passed the R$1.3 trillion mark, reaching 1 trillion 314 billion, which represents a 3% increase during the quarter and 24% increase when we compare to the second quarter of last year. Net new money came at R$29.1 billion during the quarter, showing, once again, very consistent net inflows generation and the strength of our distribution network.

For the third consecutive year, we're voted best private bank in Brazil and in Latin America by Euromoney, and this year, best private bank for family office services across Latin America. We look now at our consumer finance and banking business line, on page 16, we saw strong performance driven by portfolio expansion, improved spreads, and the inclusion of revenue contribution from our partnership with Meu Tudo.

Credit portfolio reached R$78 billion, that's a 6% increase during the quarter and a 35% increase when compared to the second quarter of '25, with most of the quarterly growth coming from the expansion of our private payroll loan portfolios. Auto loans portfolios increased 3% during the quarter and 24% when we compare to the second quarter of '25, while payroll loans portfolio grew 11% during the quarter and 61% when compared to the second quarter of last year, as we continue to privilege collateralized loans and those type of loans that have some sort of guarantees, and more recently, the private payroll loans instruments.

Following the closing of our partnership with Meu Tudo in April, we began recognizing our proportional share of 48% revenues, costs, and the portfolio exposure in our consumer business lines. Total revenues reached R$1.546 billion, with consumer credit revenues reaching R$1.395 billion, which is a 46% increase when we compare to the previous quarter.

This strong growth came from different factors, right? Most importantly, and the majority of the growth came for improvements with Banco Pan business.

Here we had better auto loans contribution from a larger portfolio and lower provisioning after a one-off adjustment that we did in the first quarter of '26. Also, we had higher private payroll loans revenues in line with the portfolio expansion, and the third is the inclusion of the proportional revenues of Meu Tudo.

Also, important to know is that we are recording six months of Meu Tudo revenues, but obviously, after the partnership with Meu Tudo, the portfolio expanded throughout this first half. The run rate by the end of the first half is much higher than the average run rate throughout this six months, we expect this revenues to continue to improve.

Too Seguros revenues reached R$152 million, reflecting a normalized run rate after the first quarter one-off regulatory impact. We go now to page 18, we look at our expenses and main ratios, and we see that our cost-income ratio continues to improve on the back of positive operating leverage.

Total operating expenses increased 1.2% during the quarter, driven by disciplined cost management and favorable revenue mix, and when we compare the second quarter of last year, we see that total expenses increased by 13%. Salaries and benefits increased by 3% during the quarter, mainly impacted by the inclusion of our proportional stake in Meu Tudo costs.

Administrative and others increased by 8.9%, again mostly impacted by inclusion of Meu Tudo. Goodwill amortization remained flat, despite the impact of Meu Tudo, as we continue to amortize the recent acquisition.

Tax charges decreased as a consequence of revenues geography, and as mentioned, adjusted cost-income ratio decreased 1% during the quarter, reaching 37%. Our effective income tax rate remained stable at 19.5%.

We look at our balance sheet, on page 20, we see the total assets remained somewhat stable as a proportion of our equity, with total assets representing 10 times our equity. We continue to maintain strong liquidity levels with more than R$100 billion of cash and cash equivalents, resulting in a stable LCR ratio of 160%.

Our unsecured funding increased strongly during the quarter with a 7.2% growth, while our on-balance sheet portfolio grew 2.6%, resulting in an expansion of our coverage ratio, which reached 142%. Our total credit portfolio represents now 4.6 times our equity, that's a reduction from the previous quarter when it was 4.8 times.

You see that despite the strong portfolio growth in both corporate lending and in consumer finance, the high profitability, and especially the strong capital generation, continues to support the expansion of all our business lines. Looking at our unsecured funding base, on page 21, as mentioned in the previous slide, our total funding grew 7% during the quarter and 32% when we compare to the second quarter of last year.

Basically, we grew our total funding by R$100 billion during the last 12 months. Demand deposits also grew in line with total funding, we kept our ratio of approximately 7% of demand deposits as a share of total funding.

During the second quarter, we managed to secure a €210 million syndicated loan for BTG Pactual Europe, our bank in Luxembourg, with banks participating across Europe and Asia, reinforcing our international presence and supporting the expansion of our European platform. Finally, when we look at our Basel ratio and VaR, we see that Basel ratio increased slightly to 16%, with our core equity Tier 1 increasing 20 basis points to 11.6%, showing a balanced approach to capital generation and capital usage.

As mentioned before, VaR reduced to 22 basis points, as geopolitical and macroeconomic uncertainties increased during the quarter. I think with that, we can go for questions.

Hi everybody. Congrats for another good quarter here, delivering ROEs.

I think the main questions we have here is regarding the consumer finance unit, the sustainability, and I think Cohn Renato already mentioned a little bit of the moving pieces. I want to get a little bit of more color here.

I think you mentioned, Renato, that the main driver was auto loans. If you can provide a little bit of more color, what was this on Banco Pan?

Just on Meu Tudo, I think I heard you mentioning that you consolidated six months in the quarter, I want to ask if this is going to be the recognition, or now it's a quarterly basis, in the third quarter we should see this more normalized in the fourth quarter. I got you mentioned that the run rate should be healthy, right, because you said Meu Tudo was stronger by the end of the quarter than at the beginning of the quarter.

I just would like to understand if the recognition here is going to be every six months, or this is going to be on a quarterly basis now. Then I have a second question regarding the SMEs.

We note your SME portfolio down almost 20% quarter-over-quarter. I know this is an important pillar for growth for you, but I also understand there is a higher risk credit outlook in Brazil.

If you can provide some comments on what is the strategy for SME, I would appreciate. Thank you.

Thank you, Yuri, for the question. For the first question regarding the improvement of consumer finance business lines revenues, the majority of the improvement comes from Banco Pan in general, right?

Part of it comes from auto loans, where we had a larger portfolio and lower impact from provisioning. You remember that in the first quarter, we did a revision of the 4966 rules on the expected loss, there was an impact, a one-off impact there in the first quarter, which was not present during the second quarter, so that made an increase or an improvement in auto loans.

Also the private payroll loans also contributed significantly with the growth of the business, right? We continue to increase portfolio originations within the private payroll loans segment, right?

The majority part of the improvement comes from Banco Pan, and then we added Meu Tudo. As I mentioned, and you correctly pointed, that we added six months of revenues of Meu Tudo, and from now on, we'll add quarterly numbers.

What I said is that because of the ramp-up of the portfolio of Meu Tudo after establishing the partnership with BTG, is that the run rate by the end of the quarter is much higher, we don't expect an impact of this difference between recording a quarter revenues in the third quarter with a half the first part because the partnership was beginning at the beginning of the year, and now it's in a more significant run rate, right?

Then, if I can just complement Cohn's answer, I think we saw a significant quarter-over-quarter improvement, which was a result of both the synergies and basically reaping the benefits and changes in strategy and integration of Banco Pan, and also now of our partnership with Meu Tudo. We expect to continue to grow from this level, but at a slower pace than what this quarter-over-quarter growth.

We are very encouraged by what we see on both different franchises. Of course, we are as worried as everybody is worried with the level of indebtedness of individuals.

We are underwriting to very conservative standards. In our view, the scenario will get worse before it gets better.

That's why we are concentrated on lines which have collateral, are lower risks, and we have been underwriting expecting deterioration already for, I would say, quite a while. This deterioration has taken longer than what we expected to have happened, which has been very good.

We're already encompassing this and already reducing exposures to the let's say the segments of higher risk or products with higher risk. As I mentioned previously, we're always underwriting credit, be it in corporate, be it in consumer finance, in spread per unit of risk.

Of course, the unit of risk encompasses the scenario which we expect. In the SME portfolio, it was a small adjustment, because since we're consistently re-evaluating the spread per unit of risk, the competition was a bit too intense, which we reduced at this moment, and we can go back to increasing if we expect the spreads to adjust or that we don't see, unfortunately, in the short term, the risk improving.

It's more related to the spreads than to the risk in this case.

No, super clear. Thank you, Sallouti.

Thank you, Cohn.

Thank you.

Thank you.

Hi everyone. Hello, Sallouti.

Hello, Cohn. Congrats on the results.

Question, maybe two questions on my side. First one on DCM.

How does the pipeline look for the second half of the year, if you have any visibility on that? Maybe some comments also on the recent league tables with some other banks being more aggressive to win mandates.

The second question is regarding a more recent debate that some economists have been bringing to the table of a recession in 2027, a possible recession in 2027. I would like to hear your opinion and how BTG is seeing this scenario.

If the environment does deteriorate, in fact, how would you expect to be more opportunistic again on capital allocation, maybe including equity stakes in companies that it can be on very cheap valuations? Love to hear your comments on that.

Thank you.

Thank you, Daniel. Our perspective on DCM is an improvement from Q2, maybe not to the level of Q1, but we are seeing marginally a bit of a better market.

You are correct. We are seeing a competition for league tables, where we think sometimes the underwriting or the firm underwritings are not, in our view, justifying the spread per unit of risk, we're fine giving up market share if we don't think that the risk-adjusted price is correct.

As I mentioned previously, that's our philosophy, which also works for DCM. It is what it is.

We have seen these cycles throughout the last decades since I've been here. Every once in a while, the market gets a bit irrational as people fight for league tables.

Eventually, economics prevails, especially, as you mentioned, in a tougher macroeconomic environment, which I think is becoming a consensus. I think it's consensus that the level of indebtedness of families is too high, the level of indebtedness of the government is too high, the level of interest rates and too high, and at some point, this will end up impacting the economy.

As I mentioned, we are underwriting to this scenario. We think there's a very probable scenario.

If it doesn't happen, great. Our job here is always, especially when underwriting the balance sheet, is to underwrite to the worst scenario expected.

If they're going to be opportunities or not, let's say, time will tell. We will continue with the approach we have always had, which is to always pay attention to different market opportunities presented by the different scenarios.

Thank you, Sallouti.

Hey guys. Good morning.

Congratulations on the results. Thank you for taking my question.

Let me ask two questions as well. First one is on capital.

Sallouti, you showed, right, your Common Equity Tier 1 ratio 11.6%, but it is down from 12% one year ago, despite, right, there's 27% ROE. Clearly, you're growing into businesses that they're more capital intensive.

Can you talk a little bit about how do you see capital evolving and what do you think is a minimum Common Equity Tier 1 ratio that you like to have? Then the second question is going back to the corporate loan book, and this change in loan mix that we saw, right, like the decline in SME loans.

We didn't see an impact on your overall spreads. The number that you show, right, the credit spread for the portfolio was 3.5% versus 3.4% in the first quarter.

I'm just wondering, should we see this change in mix having a negative impact on your spreads, and thus, it could mean slower revenue growth going forward? Thank you.

Hi Mario. Thank you for the question.

First, in terms of capital ratios and capital usage, I think we are in a pretty balanced way. If you see, it has been somewhat stable with a 10 basis points increase or decrease quarter-over-quarter, as we add a lot of capital every quarter by the high level of profitability.

As our dividend policy is to pay interest on capital or 25% of the profit, so that means we retain approximately 75% of the profits, right, with the existing 26.7% return on equity. That means that we are adding about 20% or a little bit more than that in capital every year, right?

That supports the pace of growth for our business lines that do consume capital, because several of our business lines do not consume capital, the lines that consume capital mostly are exactly the corporate lending book and the consumer finance book. I think we are in a kind of a sweet spot in terms of capital generation and capital usage, right?

Regarding the average credit spreads, right, related to the reduction of the SME portfolios, you might remember that most of our or almost all of our SME portfolios are types of collateralized portfolios, with an average spread that is similar to the large corporate spread of the book, there shouldn't be a major difference there. As Roberto mentioned, what we did is some sort of portfolio adjustments, right, where we reduced credit spreads for those that we thought that the level of spreads did not justify the risk we're taking, despite being collateralized, right?

We shifted and increased more in the corporate and large corporate book, where we saw opportunities with higher spreads. We shouldn't expect a change in credit spreads.

That's very clear. Can I ask just a third question here is more of a follow-up as well to what you said about the efficiency ratio improving?

You are realizing some synergies from Pan, but also, I think this improvement has to do with the revenue mix changing, right, you having more of a composition of this consumer finance and corporate. Is that a fair assessment that your efficiency ratio is better in these two segments than the other segments?

Yes, naturally, the businesses that use capital have a better ratio than the businesses that do not use capital. I think it's a combination of various things, right?

We're living a technological revolution with AI. We had the integration of Pan.

We are growing, as you mentioned, consumer finance and corporate lending, but we're growing wealth management faster. It's also the fact that we have the J-curve of the various new market products and segments that we have been penetrating.

I've mentioned in the past, let's say, the high-income retail investment platform, the personal banking platform, this will be happening now in consumer banking, this will be happening in cash management, this will be happening in payments, this will be happening in acquiring, this will be happening in our wealth management offering of Europe and the US. The truth, it's a combination of various things.

I would say, if you ask me personally, and sincerely, we've never mapped out what is what, I think the most important effect is the J-curve that we have of the significant investments that we did over the last few years as we launch new products and penetrate new segments.

Very clear. Thank you.

Hi, good morning, everyone. Congrats on the numbers, and thanks for taking my question here.

First, if you could just expand a bit on your comments about the credit cycle. Do you expect loan growth to decelerate throughout the year, particularly in corporate lending, or you still think that you can maintain the same level, maybe via your international expansion?

If you allow me for a second question here, I want a bit more clarity on the impact of Meu Tudo in the numbers this quarter. Can you give us an order of magnitude if you're considering the revenues recognized and the expenses?

What was the contribution to the pre-tax income? Then, if you can talk more about Meu Tudo, I'm assuming that given this high level of growth, the bottom-line contribution is still dilutive to ROE.

Can you give us a sense of where are we will stabilize there, and at what pace we should expect this to become a contributor? Thank you.

On the credit cycle, there are many factors in play here. We talked about a weaker DCM market, and I think I mentioned this in our last call.

Last year, we did not increase our large corporate portfolio in Brazil because the competition from debt capital markets was too intense. This year, with slower debt capital markets, there's more opportunity for the corporate lending book.

We continue to benefit from our penetration in the corporate and middle market segments, where we basically had zero presence a few years ago. We continue to benefit from our geographical diversification, and we are already underwriting to conservative macroeconomic environment.

With that, and where we see right now the market, we do expect that, yes, we can continue to grow, let's say, to between 15% and 20% growth for the year in the portfolio, with a healthy portfolio, given all these different things that I mentioned. On Meu Tudo, Cohn can complement me, but we're not ready to discuss any details at this moment.

We have just basically started this partnership. They have been growing strongly.

As this is a business of scale, we do expect profitability to increase as the portfolio grows. Whenever you grow the portfolio, you always have to make initial provisions, which brings the profitability a bit more in over time, which is why we're comfortable to say that we had this, let's say, this good improvement this quarter in consumer finance, but we do expect to continue to improve and grow from these levels at a slower pace.

All these factors that we mentioned, the improvement in Pan, the partnership with Meu Tudo, the continued credit portfolio, even in what we are seeing in the environment, we expect to continue to grow from these levels.

It's great guides. Thank you.

I have a follow-up question on the Stage 3 of the consumer lending. The level achieved almost 14%, and Sallouti mentioned that you guys are expecting some deterioration ahead.

My perception, talking with investors, is that this 14% was a little bit much higher than expected, and probably much higher than most of the peers that we look. Only as a comparison, Nu Holdings, for instance, they have half of this level of Stage 3.

I know that the mix is different. My question here is, can you provide any number to us, for instance, the level of delinquency ratio of this portfolio, to try to see if this 14% has been a kind of conservative approach of BTG, or if the quality of this loan is not really good?

I'm trying to help investors to understand if this 14 is okay, or is this a point that should worry investors.

I'm going to start commenting the last point. I don't think it should worry you.

I think it's a very tough job for you to compare the different product types and the different moving pieces, the speed of write-off, if you sell NPLs, if you don't sell NPLs. There are many factors.

For example, this quarter, we usually sell the NPLs of Pan. This quarter, we thought that was the right economic decision not to sell.

This led to an increase in what you can call Stage 3. Sincerely, we thought it was the right economic decision.

There are many moving pieces, and, naturally, we understand your worry. We are discussing ways we can do to make you comfortable.

We are very comfortable with the level of provisions. We are very comfortable with the results.

I agree with you that especially when you look at the accounting, the GAAP financials, this is very hard to read and very hard to compare. Going to the end of your question, no, we're not worried, and we think we have very healthy provisions.

Perfect, Sallouti.

All right, guys. Thank you very much for the call and taking questions.

Just one quick follow-up on consumer finance. I recall last quarter, Sallouti, you gave an interview saying Pan historically 12% ROE, and it should converge to the consolidated group level by '28.

I'm wondering where we are in that process. Seems like this quarter, I'm calling it Pan, but let's simplify it on consumer finance.

What kind of ROE levels are you running there today already? Then, the second question would be on corporate lending.

Revenues up 7%, loan book up 2.5%, even though SMEs fell, the implied yield looks like to have gone up. If you can help us put it together, what drove it?

Maybe it was funding, maybe it was special sits, maybe lower cost of risk in corporate, just for us to understand a little bit what drove this slightly higher revenues the way reported versus loan book in corporate. Thank you.

Thanks, Leduc. On Pan, I think we are quite on track.

We might be able to anticipate that goal by a few quarters, given how we are seeing things. Right now, we are still a bit below 20%, but improving.

Pretty much, we continue with the same expectation. We might be able to be there maybe one or two quarters before than we had expected, given that we have been able to implement changes at a faster pace than we had imagined.

I'll let Cohn answer the corporate lending.

I think you asked about the corporate lending credit spreads, right? It was a little bit higher than previous quarter.

I think many factors contributed. Cost of funding is one of them, as you mentioned, and also a little bit more revenues coming from special sits, which also, despite the recurrence that we see in special situations contribution, we see that there is some volatility there, right, a little bit of higher contribution also from special sits.

It's a combination of factors. Larger portfolio, lower or improved cost of funding, and also a little bit more of contribution from special situations.

Thank you, very useful, both. Thank you.

Thank you.

Hi team. Thank you for the opportunity to ask questions.

Just two quick ones here. I think, Sallouti, Cohn, you mentioned back in February, right, that the origination pace of Meu Tudo was around R$2.5 billion per month.

Just wanted to check if we could assume this as a reasonable run rate given today's environment. Then also, just wanted to check with you As you mentioned, the current environment in Brazil is very challenging, but maybe the last time we had the opportunity to meet, you mentioned that growing the corporate portfolio outside Brazil was certainly a good opportunity and could help to maintain your very healthy pace, no, in terms of growth.

Just wanted to check with you if this is still the case and how is the opportunity set ex-Brazil looking like for loans? Thank you.

Can I ask you just to repeat the first question, because it broke up for us and we couldn't really get it?

Sure, Sallouti. It's about the 2.5 billion origination pace for Meu Tudo, if you think this is a reasonable run rate to assume in this environment, current conditions.

Brian, for Meu Tudo, I think that the origination is lower than that, especially after it's more robust, right? Now it's a larger-sized portfolio.

We are growing, but not at this pace. Remember that we are growing not just in Meu Tudo, we are growing in Meu Tudo and Pan, right, both together in some months grew at this pace, or maybe at a quarterly rate than that we did some origination at that pace.

Regarding the international exposure of the portfolio, it's continue to improve, right, or to grow. As we mentioned last year that we passed the 20% mark, obviously, there's some variations through time, but we are getting closer to the 25%.

This will happen through time as we continue the expansion in international locations. We did the acquisition of the bank in Luxembourg 3 years ago.

The bank now it's much more developed and growing. We concluded the acquisition of the bank in the US at the end of last year, this is developing.

We just concluded in July the acquisition of the bank in Uruguay. We are expanding.

We are improving the infrastructure for that, and we expect this process to continue to improve.

Super clear. Thank you.

Hi, morning, guys. Congratulations for the results.

Two questions. First one, there was a positive impact from the incorporation from the revenues from Meu Tudo.

My question is, I understand higher revenues, but also higher expenses with provisions and etc. My question is, what is the net impact of that incorporation?

I understand you did not treat it as a nonrecurring, but just for me to understand what would be, I would say, the net income if we adjusted for this net impact from the incorporation of Meu Tudo. That's my first question.

The second one is, from my valuation model, if I look forward, do I need to change the structure from now on considering, I would say, more revenues coming from products that consume capital? How should I look forward in terms of the participation of loans as a contributor for the total revenues of the bank?

That's it. Thank you.

Hi, Navarro. First, the truth is we have the revenues there, we have the cost-income of our consumer finance consolidated to everything.

It's very important that you always look at the thing as a whole, right? Probably looking how to model this, you can expect some growth for consumer finance from the levels of this quarter, and we expect this to come from both of our franchises, as Pan that we own 100% and the partnership we have with Meu Tudo.

On if you should expect more capital, no, you should expect that we continue to allocate the capital that we accumulate through retained earnings, just as we have been doing in the past years. With that, we probably expect that the equilibrium of businesses that use capital and don't use capital will remain slightly stable, given that expect growth to come from across business lines.

I mentioned here consumer finance will probably go faster in the next six quarters, but wealth management will grow much stronger than corporate lending. When you put all of these things into consideration, I think it's fair to say that you can expect a similar mix of businesses that use capital and businesses that don't use capital as we've had in the last few years.

Thank you. Yes, I was wondering, for example, looking forward is if BTG is going to be a bank that, just like other banks, will start publishing in the main page ratios like NPL, provisions, Stage 1, Stage 2, Stage 3 loans.

Those kinds of ratios that are normally more concerned to banks that do lending in a more aggressive way. That's it.

Hi Navarro. I think, as Roberto mentioned at the beginning of the presentation, that we would expect credit to become a more important part of the revenue mix of BTG as a whole, but not as dominant as what we see in the large incumbent banks, right?

I think we will migrate to a bit more equilibrium in terms of revenues generation coming from credit segments, but they will not be as dominant as they are in the large incumbent banks. I think that's the difference, right?

The truth is, the consumer finance credit just gave us a further exposure. We could continue growing just in corporate lending, but we decided to also diversify geographically, we decided to diversify in segments, and it's exactly the same thing with consumer finance.

It's not really changing the mix of the businesses that use capital and don't use capital, which remain relatively stable, as can be seen by the growth in the different business lines, as can be seen by the capital ratio. For us, it's very important to have this diversification so that we can continue with our alpha management of credit exposure.

We don't want to be beta to the market. We think that, as can be seen by what's happening in the market, there's a lot of alpha being generated in credit.

This does not mean that this will become commanding. As you can see, wealth management is growing 30%, our investment management contribution is over roughly 25% of total revenues.

We don't expect a change in mix. For us, having this diversification is crucial for us to have an alpha strategy in credit.

Thank you.

Hello everyone. Thank you for the opportunity.

My question is regarding the leverage, operational leverage. Assuming the fact that you guys are saying that the consumer banking revenues will grow next quarter, the revenues will grow, the portfolio will grow in a different pace, but will grow, can we assume that the levels of efficiency ratio, comparing expenses and revenues, are the levels that we will see in the next quarter?

Can I expect something around those levels, which is better than the levels that last quarter or even the end of the last year looking forward? Thank you.

Hi Marcelo. No, I think there is a lot of embedded operating leverage into the overall business, right?

You see that the revenues are twice as high as the costs, right, when we grow revenues at a faster pace than costs, the operating leverage, which is already embedded as I said, will make the cost-income ratio to dilute over time. We expect this to continue to happen as we benefit from different sources of revenues.

Overall, you see growth and strong growth in wealth management, you see growth in asset management, you see growth in the credit books, both consumer finance and in the corporate lending. Overall, the combination of revenue growing at a faster pace than what we see in costs, as Roberto said, we continue to benefit from the improvement of the J-curve from all the investments that we did in the past.

It doesn't mean that we are not investing. We are still investing, but as a magnitude of the revenues, it's much smaller than what we did in the past.

We are collecting now the benefits of advancing into the J-curve.

Thank you.

Hi, everyone. Good morning.

Thanks for the opportunity to ask questions, and congrats on another great quarter. Sallouti, I wanted to follow up on something you mentioned.

You talked about a complicated backdrop for credit risk given excessive consumer leverage, excessive government leverage, and overall weak macro. At the same time, you mentioned that you had been expecting a correction for a while that hasn't really happened.

I guess two questions. The first one is, why do you think it hasn't happened?

What have been the factors that have been keeping things in check? Second, to what extent those factors may extend longer than you think, and maybe the backdrop for risk is not as negative as your position for?

Thank you.

Thanks, Jorge. In our view, this has not happened because the government expenditures have been growing more than what we expected, especially this year.

They were growing at a slower pace towards the end of this year and beginning of last year. This accelerated with the electoral cycle to very strong levels, which we don't believe are sustainable towards next year.

That's why we think it's inevitable that at some point in time, this slowdown will happen and, especially given the level of indebtedness of family, it can be a more complicated cycle. Nothing disastrous, but we just have to realize that we're living a very benign environment, very low unemployment, strong income levels.

We're also living something interesting, and you can see that we are focusing on collateralized credits because we think there's also a lot of micro things happening in the consumer credit market. For example, we think this private payroll loan creation is something that changes drastically how you underwrite clean credit.

For us, it's still not clear how to underwrite this. As you can see, we're not growing clean credit in consumer finance, because we don't feel confident to what the future will be like, because we think the future is very different than the past.

Because the past, you did not have this private payroll loans, for example. Even in private payroll, it's not a product that you underwrite generically.

There's a lot of modeling that goes into the corporate risk, the employment risk, the re-employment risk, now the guarantees. There's a lot of complexity here that also affects the scenario of credit underwriting, which is not only the macro.

Just going back to your first point is what we think has pushed this further or delayed what we saw as an expected deterioration has been the increase in fiscal spending.

Great. Thank you very much, Sallouti.

Congrats, again.

Thank you.

Thank you, another one, regarding provisions on private payroll. We are seeing a lot of discussions regarding the right levels of provisions or unexpected provisions on this product.

Can you share with us the levels of delinquency of BTG on this portfolio and also the levels of provisions that you guys are doing right now? Thank you.

Hi Marcelo. No, I think we are adequately provided using Central Bank 4966 rules with the initial provision of expected loans, right, that we do at the origination process, and then following the process with the table if these products become delinquent.

I think we are adequately provided there.

In terms of delinquency on this product, Cohn, the portfolio is controlled or is becoming a more riskier portfolio or is become better?

Actually, the performance of the portfolio has been better than we expected, especially on the re-employment, which was something that we had not modeled initially, that it has been happening and faster than we expected. If anything, the performance of the portfolio has been better than what we had expected initially.

Thank you, guys.

Thank you.

Thank you very much for joining us for our quarterly call. We hope to see you all at the end of the third quarter.

Thank you very much. Have a great week.