Q: Can you comment on the quarter and whether you feel the stock offers good value here?
5i Research Answer:
It was not a good quarter, but there is a transition going on, and the new CEO has made changes and has indicated 2024 will be an improvement. The main issue was higher loss provisions, at $1.26B vs $870M expected. The bank is 'probably' being conservative but no doubt is seeing signs of a slowdown and associated loan quality. EPS missed because of this, at $1.26 vs $1.67 expected. Chile and Peru continue to be a drag on performance. In two weeks, the bank plans to unveil its new strategy. Shares will take a hit today, but were already good value at 8X earnings. A purchase assumes we don't enter a deep recession and the new CEO can guide this ship. It is 'buyable' but the quarter itself was disappointing.