Slide 1: Findep 1Q23
1Q23 fal Wi a ra ic
Slide 2: Disclaimer
Disclaimer This presentation was prepared solely for informational purposes and does not constitute, and is not to be construed as, an offer or solicitation of an offer to subscribe for or purchase or sell any securities. The securities mentioned in this presentation have not been and will not be re
Slide 3: Company Overview
Company Overview Findep (the “Company”), leader in bringing financial inclusion to the underserved Hispanic communities in North America through responsible lending and insurance products. Key Pillars Subsidiaries Big underserved market In Mexico, 63%1 of the population is unbanked and in the US 30%2
Slide 4: 1Q 2023 Highlights
1Q 2023 Highlights Highlights Other Milestones Findep’s strategy in improving its maturities profile, strengthening its balance sheet, and maintaining positive profitability trends, is reflected on this quarters results: Exchange Offer Acceptance Net debt retreated Net Profit MX$ 166 million of 64% 19%
Slide 5: Current Situation: Strengthened Balance Sheet
Current Situation Strengthened Balance Sheet 1Q23 vs. Million Pesos 2016 2022 1Q23 2016 Total Assets 12,155 11,686 11,120 -9% Tangible Assets (a) 10,568 10,677 10,111 -4% Total Portfolio 7,448 8,560 8,053 8% Total Portfolio (FISA+AEF+AFI) 5,476 8,560 8,053 47% Net Debt (b) 6,825 4,587 3,826 -44% Tot
Slide 6: Current Situation: Benefiting from operating efficiencies
Current Situation Benefiting from operating efficiencies Principal lines of Income Statement 2016 3M23 annualized % of average portfolio % of average portfolio *LLR methodology is not comparable as we implemented the CNBV methodology in 1Q22. As a proxy, TTM write-offs to average portfolio decreased f
Slide 7: Consistent gains in net income
Current Situation Our strategy and execution have yielded consistent gains in net income Net Income excluding one-off, non-cash effects on results (Million Pesos) 2.8x * Excluding write-off of Finsol Mexico’s goodwill effect for MXN 448 m in 2020, and MXN 311 m in excess discretionary reserves, whic
Slide 8: Our strategy and execution have yielded consistent gains in net income
Our strategy and execution have yielded consistent gains in net income Excluding one-offs non-cash events 1Q 2Q 3Q 4Q Total 2012 34 (38) 8 (120) (116) 2013 51 56 66 81 254 2014 101 63 78 76 318 2015 60 39 63 47 209 2016 53 40 81 60 234 2017 68 66 60 30 225 2018 27 82 74 80 262 2019 63 89 76 97 324 2
Slide 9: Investment Highlights
Investment Highlights 1 ● Stable and profitable throughout economic cycles Unique ● Knowledge of the segment and the business built through Business experience with millions of loans originated Model ● Demonstrated ability to reduce origination and generate cash 2 ● Continued investment in analytics
Slide 10: Unique Business Model: Consistent Profitability and Improving Asset Quality
1 Unique Business Model Consistent profitability and low volatility through crises. Consistent Profitability and Improving Asset Quality* Our portfolio has yielded consistently over 40% annually in Total Operating Revenue even through the worst of the pandemic. Likewise, NPLs have continued to decreas
Slide 11: Unique Business Model: lowest volatility and fastest recovery
1 Unique Business Model FISA & AEF showed the lowest volatility and fastest recovery in the market. Maximum increase in NPLs from 1Q20 to peak and time to regain pre-pandemic levels. Maximum Increase in NPLs 29% 52% 277% 242% 124% 73% 68% Months from 1Q20 to Peak 6 7 8 12 10 11 9 Months from Peak to
Slide 12: Unique Business Model: Proven ability to generate cash and de-lever
1 Unique Business Model Proven ability to generate cash and de-lever the Company ● Quarterly collection (principal, interest and accessories) is above 25% of loan portfolio ● We can decide to deleverage by reducing origination and contracting the portfolio, as exemplified between March and September
Slide 13: Balance risk and growth: Mexico and US Portfolio Performance
2 Balance risk and growth Mexico and US Portfolio Performance 1Q23 vs. 4Q20 +38% AFI 1Q23 vs 4Q20 +59% MEX 1Q23 vs 4Q20 +27%
Slide 14: Focus on individual unsecured loans
2 Balance risk and growth Focus on individual unsecured loans to simplify the corporate structure ● Individual unsecured loans can achieve efficiencies through digital transformation. ● Aligned with our expertise. Strong skills in Data Analytics, Risk Management, and Systematic Operation are key to s
Slide 15: Actions taken to support stakeholder confidence
2 Balance risk and growth Actions taken to support stakeholder confidence ● Clear message of long term commitment to debt investors on Strengthened Balance Sheet behalf of equity holders. (No dividends since 2016) ● Better position to navigate challenging market. ● Listened to stakeholders and switch
Slide 16: Growth in the US: AFI has grown 3.1x since 2016
3 Growth in the US AFI has grown 3.1x since 2016 AFI (US) Portfolio, USDm ● Our US portfolio has grown 3.1x in the last 6 3.1x 179m years, a 20% CAGR, mostly in California. ● Unserved Hispanic market (62m) in the US, with California being the largest market. ● Proven business model poised for growth
Slide 17: Growth in the US: operating leverage and efficiency
3 Growth in the US An increase in operating leverage has yielded significant efficiency AFI Non-Interest Expenses / Average Loan Portfolio 16
Slide 18: We expect a majority of our assets to be located in the US
3 Growth in the US We expect a majority of our assets to be located in the US % of Findep total portfolio Under a constant FX basis, the US portfolio in the overall mix would have remained at 42% during 1Q23 17
Slide 19: Efficiency through technology
4 Efficiency through technology Technology has allowed us to do more with less Loan Portfolio per Employee (Thousands MXN) Initiatives ● Migrating IT platform to the cloud. 2.3x ● Developed mobile tools to enable efficiency of Customer Service staff. ● Self service tools for our customers. Outcome ● O
Slide 20: Final Remarks: 2024 refinancing options
Final Remarks We have plenty of time and options to refinance our 2024 bond… Current Situation 2024 Refinancing Options Although recent concerns regarding the financial stability of other Mexican non-bank lenders are weighing on our bond… ● We have the strongest balance sheet in the ● Extension of term
Slide 21: Slide 21