Supervielle flying in Argentina

Grupo Supervielle is set to continue its rapid, above-industry-average growth in 2017, according to Milton Migotti, head of international trade and financial institutions.

The banking group was the first Argentine financial institution to take advantage of improved investor sentiment about the country after Mauricio Macri became president. In May 2016, Grupo Supervielle sold a $323 million IPO through a New York listing. The deal was three-times oversubscribed, with all but a handful of the 71 investors being based outside Argentina.

Supervielle followed up that equity transaction by raising $300 million-equivalent – denominated in Argentine pesos – in an international debt transaction in February. Combined, the increased financing has enabled the bank to grow aggressively in its target segments.

“We grew our loan book by 50% last year, which was above the market,” says Migotti, who concedes that inflation of 30% puts the huge nominal growth into context. “We expect to grow at between 40% and 45% this year with inflation at about 25%.”

Supervielle actually accelerated growth at the end of last year while inflation was falling. In the fourth quarter, the bank increased its loan portfolio by 57.5% year-on-year and increased net income by 47.8% year-on-year (22% quarter-on-quarter) and hit a return on equity of 31.3%.

Migotti says the banking sector is finally getting some relief from the central bank’s policy of having positive interest rates – after years of having base rates lower than the inflation rate. “That has been a positive factor for the savings rate at the banks,” he says.

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