Grupo Financiero Banorte SAB de CV Class O · BMV:GFNORTE/O

Grupo Financiero Banorte SAB de CV Class O — Q1 2023 Earnings Presentation

82 slides from Grupo Financiero Banorte SAB de CV Class O's earnings presentation, April 2023

  1. Slide 1: Corporate Presentation 1Q23

    Corporate Presentation 1Q23 DB Div BAP Eco 1 NIM Rev NI ROE TI L D Dep Loan ICAP Guid Mkt ESG Hist C/I App

  2. Slide 2: Table of Contents

     Table of Contents Markets Awards About Banorte 3 Results NIM 12 GFNORTEO Fees 14 Cost to Income 15 Net Income 16 ROE / ROA 17 Digital Bank 19 GBOOY Deposit & Loans 24 Loans / Deposits 25 Deposits growth 26 Loan growth 27 Asset Quality - NPL 29 XNOR CAR 31 BAP (Insurance, Pension & Afore) 33 Insura

  3. Slide 3: About Banorte

    About Banorte DB Div BAP Eco 3 NIM Rev NI ROE TI L D Dep Loan ICAP Guid Mkt ESG Hist C/I App

  4. Slide 4: GFNORTE – A Leading and Profitable Financial Franchise in Mexico

     GFNORTE – A Leading and Profitable Financial Franchise in Mexico 2 1 Sound Fundamentals 4 Adequate business mix Solid asset quality, high 3 Strong retail, wholesale and liquidity, and strong Solid corporate governance premium banking platforms, capitalization ratios. Independent Board Members Digi

  5. Slide 5: From Regional Bank to Second Largest National Financial Group

     From Regional Bank to Second Largest National Financial Group 15%* 1,2,3 Plan 20|20 Plan Client • Banorte’s Segmentation Digital Business Diversification Transformation * Loan book IT : central DB, Market Share Inorganic Growth multichannel • JV Rappi 2.3% Profitability • bineo – Regional Bank Dig

  6. Slide 6: Strategy – Client centric & Digital Evolution

     Strategy – Client centric & Digital Evolution PRODUCTS & DISTRIBUTION SOLUTIONS CHANNELS > 10M New customer Rappi clients behavior Deposits & Loans Mobile Client Segmentation Insurances ▪ 11.5 million ex-Afore clients Web Rappi JV Digital 8.6 million Afore clients Pensions ATM Consumer focus Bank

  7. Slide 7: Diversified Business Mix

     Diversified Business Mix In progress… bineo Banco Casa de Operadora Banorte Arrendadora JV with Other Digital Mercantil Bolsa de Fondos Ahorro y y Factor RAPPI Subsidiaries* Bank del Norte Banorte Banorte Previsión Banorte** 50% 100% 98.2618% 99.9999% 99.9987% 99.9999% 99.9009% Looking for fully l

  8. Slide 8: Business Mix - Diversified Net Income and Balance

     Business Mix - Diversified Net Income and Balance Net Income Mix Net Income by Subsidiary 1Q23 $13.0 bn Other Finance Companies Afore 1% 2% Holding Million pesos 1Q23 q/q y/y ROE 1Q23 3% Annuities Bank 10,130 19% 35% 5% 27.5% Bank Broker Dealer & Mutual F. 89 (48%) (90%) Insurance 78% 6.1% 11% Ins

  9. Slide 9: Net Interest Margin Moving in the Right Direction

     Net Interest Margin Moving in the Right Direction NIM 7.0% 6.6% 6.6% 6.3% 6.5% 6.0% 6.0% 5.6% 5.5% 5.6% 5.4% 5.5% 5.3% 4.9% 5.0% 4.7% 4.4% 4.5% 4.5% 4.1% 4.8% 4.0% 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 1Q22 2Q22 3Q22 4Q22 1Q23 Previous criteria IFRS NIM (Post-Provision) 6.5% 5.9%

  10. Slide 10: Margin Sensitivity Evolution

     Margin Sensitivity Evolution ● Dynamic risk management hedges. Focus on stable low-cost liabilities. Active ALCO. Organic growth of floating rate portfolio. NII Sensitivity per 100 bps in rate change Foreign Currency Balance Sheet Local Currency Balance Sheet Million pesos Million pesos 1,205 1,22

  11. Slide 11: Core Banking Fees keep growing

     Core Banking Fees keep growing +14% ▄ Net Fees flat q/q, +10% y/y, driven by: Net Fees y/y ▄ Core banking fees seasonal contraction (8%) q/q, and Million 5,000 Previous criteria IFRS +10% y/y; with electronic banking services +12% y/y. pesos 4,223 4,208 4,000 3,687 ▄ Digital transactions leading a

  12. Slide 12: Efficiency already recovered from the pandemic

     Efficiency already recovered from the pandemic Cost to Income 57.0% 54.0% Previous Criteria IFRS 52.0% 52.0% 48.5% 47.9% Recurring 44.9% 40.0% 39.7% 45.4% 47.0% 42.8% 41.4% 40.8% 42.0% 39.0% 39.1% 42.7% 36.2% 37.0% 34.5% 37.4% 32.0% 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 1Q22 2Q22

  13. Slide 13: Net Income growing

     Net Income growing Net Income Million Pesos CAGR +30% +15% YoY 2012-2022 45,408 +21% 47,000 YoY 42,000 14,000 13,018 36,528 13,000 37,000 31,958 35,583 12,000 11,524 11,544 11,592 +12% 35,345 35,048 QoQ 32,000 10,748 11,000 Recurring 30,508 27,000 10,000 23,908 22,000 9,000 19,308 17,108 8,000 17,

  14. Slide 14: Pre-pandemic - Constant Positive Growth in Profitability

     Pre-pandemic - Constant Positive Growth in Profitability ROA 2.48% 2.5% 2.30% 2.26% 2.26% 2.18% 2.05% 1.94% 2.0% 1.86% 2.18% 1.60% 1.46% 1.47% 1.76% 1.85% 1.5% 1.40% 1.30% Previous Criteria Recurring IFRS 1.0% 2012 2013 2014 2015 2016 2017 2018* 2019* 2020* 2021 2022 1Q22 2Q22 3Q22 4Q22 1Q23 ROE 2

  15. Slide 15: Pre-pandemic - Constant Positive Growth in Profitability (Bank)

    ➢Pre-pandemic - Constant Positive Growth in Profitability ROA of the Bank 3.0% 2.5% 2.27% 2.36% 2.12% 1.79% 2.62% 2.0% 1.60% 2.40% 2.35% 1.56% 2.02% 2.24% 2.25% 1.40% 1.40% 1.47% 1.5% 1.96% 1.1% 1.61% 1.74% 1.0% Previous Criteria Recurring IFRS 0.5% 0.0% 2011 2012 2013 2014 2015 2016 2017 2018* 2019

  16. Slide 16: Transformation

    Transformation 1. Digital Transformation at Core Bank 2. Rappi JV 3. bineo Digital Bank DB Div BAP Eco 16 NIM Rev NI ROE TI L D Dep Loan ICAP Guid Mkt ESG Hist C/I App

  17. Slide 17: Digital Transformation Gaining Share

     Digital Transformation Gaining Share Transactions (Tx) Transactions 1Q23 (millions) Branches 800.0 2.2% WEB 700.0 12% 600.0 POS 24% 500.0 400.0 +48% Correspondents 0% 300.0 1Q y/y Call Center 1% 11% 200.0 50% Mobile ATM 100.0 0.0 Digital Deposit Account Customers Using Digital (million) Mobile Cre

  18. Slide 18: Customer's Voice, Key in Banorte's Evolution

     Customer’s Voice, Key in Banorte’s Evolution ● On the right track to reach a 90-point NPS score, based on improvements from internal customers: Banorte Móvil WEB App o processes / services / systems o products o branch-administration, contingency, others +1.7 pts 79.8 +0.7 pts 84.1 vs 1Q22 vs 1Q22

  19. Slide 19: Leaders in the Business & Infrastructure for the Payments Market

     Leaders in the Business & Infrastructure for the Payments Market Rappi JV – Credit Cards and Credits to affiliates POS Transactions +13% Millions 1Q y/y The best DIGITAL PLATFORM for aggregators 400 350 Digital Physical 300 187 176 250 178 200 150 100 177 174 132 CoDi 50 0 1Q21 2Q21 3Q21 4Q21 1Q22

  20. Slide 20: Ongoing RappiCard evolution

     Ongoing RappiCard evolution RappiCard: keeps growing in cards and billing 867k 826k 59% Issued Cards with at Of cardholders cards least one with a credit line purchase above Ps 5,000 1,965M1 71% 77% Average Monthly active Of users under monthly billing users 36 years old Source: JV Banorte Rappi,

  21. Slide 21: Loans & Deposits

    Loans & Deposits DB Div BAP Eco 21 NIM Rev NI ROE TI L D Dep Loan ICAP Guid Mkt ESG Hist C/I App

  22. Slide 22: Healthy Funding & Loan Portfolio Structure

     Healthy Funding & Loan Portfolio Structure Bank Deposits 2018 $759 bn 1Q23 $939 bn US 50.0 bn Senior Unsec. Debt Senior Unsec. Debt Money Market Money Market Demand Time Time Demand Loan Portfolio $777 bn $950 bn US 50.6 bn Consumer Consumer Government Government Mortgage Mortgage Commercial Comme

  23. Slide 23: Loyal Deposits' Base

     Loyal Deposits’ Base Deposits CAGR 2011-2022: Billion Pesos +10% YoY 900 840 834 818 840 833 +5% 796 Time Demand Core Deposits 751 750 800 667 700 637 623 616 623 590 600 614 YoY 551 +11% 584 600 509 533 538 +5% 500 436 438 384 397 414 384 400 336 351 306 300 255 YoY 300 211 223 229 217 211 217 21

  24. Slide 24: Continued Growth in Performing Loan Book, Special Focus on Consumer

     Continued Growth in Performing Loan Book, Special Focus on Consumer Loan Portfolio Billion Pesos YoY 920 920 950 1,000 +14% 861 876 900 821 835 777 802 763 800 700 616 567 CAGR: 600 518 +9% 472 500 401 425 400 300 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 1Q22 2Q22 3Q22 4Q22 1Q23 1Q22

  25. Slide 25: Rate comparison

     Rate comparison Reference Rate vs Loan Portfolio’s Yield Reference Rate vs Consumer Yield 29.6% 14.0% 13.2% 30.0% 20.0% 26.3% 12.0% 25.0% 28.4% 10.3% 25.0% 26.8% 15.0% 9.2% 11.25% 10.0% 24.6% 11.25% 8.0% 20.0% 9.1% 9.1% 8.9% 10.0% 6.50% 6.0% 6.50% 15.0% 4.00% 5.0% 4.0% 4.25% 13.7% 12.7% 13.2% 2.0%

  26. Slide 26: Sound Asset Quality

     Sound Asset Quality NPL Ratio 3.1% 2.9% 3.0% Previous Criteria IFRS 2.5% 2.2% 2.1% 2.0% 2.0% 1.8% 1.7% 1.7% 1.5% 1.1% 1.0% 1.0% 0.9% 1.1% 1.0% 1.0% 1.0% 1.1% 1.0% 0.5% 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 1Q22 2Q22 3Q22 4Q22 1Q23 Previous Criteria IFRS | 2018 2019 2020 2021 3Q21

  27. Slide 27: Sound Asset Quality

     Sound Asset Quality Coverage Ratio 250% 224% 207% 202% 193% 179% 188% 179% 182% 200% 138% 191% 150% 139% 129% 142% 138% 105% 107% 116% 100% 50% Previous Criteria IFRS 0% 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 1Q22 2Q22 3Q22 4Q22 1Q23 Cost of Risk 3.0% 2.8% 2.5% 2.5% 2.0% 2.0% 2.3%

  28. Slide 28: Strong Capital Position

     Strong Capital Position Capital Adequacy Ratio Basel III 25.8% 24.7% 22.9% 23.0% 22.8% 22.1% 0.4% 20.2% 0.3% Tier 2 TLAC 18.6% to 2025 17.2% 17.2% 6.3% 17.90% 15.3% 15.3% Total 14.6% Tier 1 21.7% 13.025% +1.625% TLAC 4Q22 11.40% 9.40% 15.3% 16.3% 15.4% 14.7% 15.1% CET1 7.90% 13.9% 13.7% 12.7% 12.4

  29. Slide 29: Insurance & Annuities Technical Results

    ➢Insurance & Annuities Technical Results Technical Results from Ins. & Ann. NII + Technical Results from Ins. & Ann. 0 4,000 3,794 -500 3,750 -1,000 3,500 -1,500 3,250 -2,000 3,055 -2,500 3,000 2,816 -3,206 -3,123 -3,000 -3,376 2,750 -3,500 2,500 -4,000 2,250 -4,500 -5,000 2,000 1Q22 2Q22 3Q22 4Q22

  30. Slide 30: BAP: Long Term Savings Business

     BAP: Long Term Savings Business Million Pesos 1Q22 1Q23 YoY 1Q22 1Q23 YoY Insurance Considering Banorte Futuro Net Income 1,222 1,366 12% 1,387 1,682 21% Equity 7,051 9,183 29% 23,825 24,950 5% Assets 55,045 56,265 3% 71,447 72,343 1% Premiums 13,532 11,640 (14%) 13,532 11,640 (14%) ROE 75.7% 64.8

  31. Slide 31: Insurance business steadily improving

     Insurance ➢Insurance business Business steadily Steadily improving Improving ▄ Operating Income from insurance increased +38% Retained Insurance Technical Reserves sequentially on seasonality and interest income. Premiums 4,522 6,000 Million pesos 12,000 ▄ 3,324 Premiums reducing (10%) y/y but on

  32. Slide 32: 2023 Guidance

    ➢2023 Guidance 2023 Guidance Loan Growth 6% – 8% NIM 6.5% – 6.8% NIM of Bank 6.7% – 7.0% Recurring Expense Growth 7.0% - 8.0% * Includes bineo 2% Total Expense Growth* 11.0% – 13.0% Efficiency 36.0% – 38.0% Cost of Risk 1.6% – 1.8% Tax Rate 24% – 26% Net Income 50.5 – 52.5 bn ROE 2023 19.5% – 21.0%

  33. Slide 33: Market Presence

    Market Presence DB Div BAP Eco 33 NIM Rev NI ROE TI L D Dep Loan ICAP Guid Mkt ESG Hist C/I App

  34. Slide 34: Deposit & Loan Market Share

     Deposit & Loan Market Share Deposits Loans 2nd 2nd Source: CNBV April 2023 DB Div BAP Eco 34 NIM Rev NI ROE TI L D Dep Loan ICAP Guid Mkt ESG Hist C/I App

  35. Slide 35: Market Share by Segment

     Market Share by Segment Auto Payroll C. Card Mortgage Comm + Corp Government Deposits Apr-22 Apr-23 Apr-22 Apr-23 Apr-22 Apr-23 Apr-22 Apr-23 Apr-22 Apr-23 Apr-22 Apr-23 Apr-22 Apr-23 Banorte 19.3% 21.6% 20.3% 20.7% 10.4% 9.9% 18.7% 19.4% 11.7% 11.7% 25.1% 26.6% 12.9% 13.3% BBVA 30.6% 27.9% 37.9%

  36. Slide 36: Market Share by Segment

     Market Share by Segment Total Loan Book Commercial & Corporate Mortgage 11.8% 11.7% 11.7% 15.0% 19.7% 14.8% 19.5% 19.3% 19.4% 14.7% 14.4% 18.7% 10.3% 10.0% +3bp 13.5% +19bp +71bp Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 Apr-19 Apr-20 Apr-21 Apr-22 Apr-23 Credit Card Au

  37. Slide 37: Afore Market Share (Retirement Savings)

     Afore Market Share (Retirement Savings) Assets Under Management AUM Market Share Billion Pesos Mar-22 Mar-23 Mar-22 Mar-23 1° XXI Banorte 1,061 1,107 20.5% 20.3% Profuturo GNP 860 935 16.6% 17.1% CitiBanamex 814 855 15.7% 15.7% SURA 791 846 15.3% 15.5% Coppel 380 405 7.3% 7.4% PensionISSSTE 352 36

  38. Slide 38: Insurance Market Share

     Insurance Market Share Premiums Market Share Net Income Market Share Million Pesos Dec-21 Dec-22 Dec-21 Dec-22 Dec-21 Dec-22 Dec-21 Dec-22 G.N.P. 78,894 88,896 13.5% 14.2% 1,618 2,633 5.7% 5.4% Metlife México 62,472 69,710 10.7% 11.1% 2,750 9,840 9.7% 20.2% BBVA 47,875 55,547 8.2% 8.9% 4,141 6,213

  39. Slide 39: Annuities Market Share

     Annuities Market Share Resolutions * Market Share Million Pesos Mar-22 Mar-23 Mar-22 Mar-23 Banorte 5,013 4,294 44.6% 43.6% 1° Bancomer 3,936 2,791 35.0% 28.3% Profuturo GNP 2,285 2,775 20.3% 28.1% Total Industry 11,234 9,860 100.0% 100.0% Annuitants Market Share Mar-22 Mar-23 Mar-22 Mar-23 Banort

  40. Slide 40: GFNorte in the World

     GFNorte in the World Market Capitalization Million Pesos US 23.3 bn 500,000 4Q22 Total Shares Outstanding: 2,883.5 m 437,997 450,000 431,221 Float: ~ 86% 403,424 (1) Total ADRs Outstanding: 7.63 m 400,000 350,000 Ticket Indexes 300,000 IPC (BMV) Sustainable IPC (BMV) GFNORTE O (BMV) Oil and MSCI M

  41. Slide 41: Analysts' Opinion & Investment Grade by All Major Rating Agencies

     Analysts’ Opinion & Investment Grade by All Major Rating Agencies Analysts’ Estimates Ratings Agencies (as of April 20, 2023) Agency Rating Outlook Date Net Income 2023 $52,053 Target Price $173.3 Standard & Poor’s BBB Stable Jul-22 Maximum $198.0 Number of Analysts 22 Fitch BBB- Stable Dec-22 # B

  42. Slide 42: ESG

    ESG DB Div BAP Eco 42 NIM Rev NI ROE TI L D Dep Loan ICAP Guid Mkt ESG Hist C/I App

  43. Slide 43: Sustainability Strategy

     Sustainability Strategy MSCI ESG Latest Ratings Action: Three AA consecutive years DB Div BAP Eco 43 NIM Rev NI ROE TI L D Dep Loan ICAP Guid Mkt ESG Hist C/I App

  44. Slide 44: Continuous evolution in ESG on the back of constant feedback from investors

     Continuous evolution in ESG on the back of constant feedback from investors ENVIRONMENTAL SOCIAL GOVERNANCE SUSTAINABLE FINANCE SECOND TCFD (Task Force on CEMEFI recognition for 12th For the SECOND consecutive Release of PRB (Principles for Climate-related Financial consecutive year for Banorte ye

  45. Slide 45: Sustainable Finance

     Sustainable Finance Loan book evaluation Responsible Investments – Mutual Funds % of wholesale banking loan book % share of total analyzed AUM by instrument Asset Class 15.0 Fund´s Portfolio 12.5 11.896 Equity 69 0… 10.0 Fixed Income 98 7.685 18 7.5 7.0 Money Market 94 0.650 5.… 0.25 5.0 0.001 0.1

  46. Slide 46: Integrated Annual Report 2022

     Integrated Annual Report 2022 • Main financial & ESG highlights and addresses valuable feedback from our investors including best practices established by GRI, SASB and CDP questionnaire on climate change aspects. • Environmental: CO2 emissions quantification & decarbonization targets for the most

  47. Slide 47: Appendix

    Appendix DB Div BAP Eco 47 NIM Rev NI ROE TI L D Dep Loan ICAP Guid Mkt ESG Hist C/I App

  48. Slide 48: Quarterly Summary

     Quarterly Summary GFNorte-Consolidated Statement of Change Comprehensive Income Highlights 1Q22 4Q22 1Q23 (Million Pesos) 4Q22 1Q22 Interest Income (1) 55,322 80,773 87,223 8% 58% Interest Expense 28,310 49,548 55,493 12% 96% Net Interest Income 27,012 31,225 31,730 2% 17% Net Service Fees (3) 3,6

  49. Slide 49: Quarterly Summary

     Quarterly Summary Financial Ratios GFNorte 1Q22 4Q22 1Q23 NIM (1) 6.0% 6.6% 6.6% ROE (2) 18.1% 19.4% 21.5% ROA (3) 2.2% 2.3% 2.5% Efficiency Ratio (4) 36.2% 40.8% 34.5% Operating Efficiency Ratio (5) 2.0% 2.5% 2.1% CCL Banorte and SOFOM - Basel III (6) 221.9% 154.6% 154.8 Past Due Loan Ratio 1.0%

  50. Slide 50: Quarterly Summary

     Quarterly Summary Change Share Data 1Q22 4Q22 1Q23 4Q22 1Q22 Earnings per share (Pesos) 3.728 4.020 4.515 12% 21% Earnings per share Basic (Pesos) 3.756 4.062 4.551 12% 21% Dividend per Share for the period (Pesos) 0.00 5.81 0.00 (100%) N.A. Payout for the period 0.0% 47.8% 0.0% (100%) N.A. Book V

  51. Slide 51: Healthy Liquidity

     Healthy Liquidity Loans to Deposits Liquidity Coverage Ratio (%) CCL (%) 110% 230% 222% 108% 208% 210% 106% 104% 190% 104% 103% 170% 102% 155% 100% 100% 150% 98% 130% 96% 110% 94% 90% 92% 90% 70% 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 3Q 1Q 2016 2

  52. Slide 52: Selected industry exposures

    Selected industry exposures Vs. Total Loans 1Q23 Oil Industry* 4.4% Electricity Companies* 4.2% Construction & Real Estate Housing 1.3% Commercial 1.4% SMEs Others 1.3% • 70% Nafin / Bancomext guaranteed 4.5% Malls 1.8% loans, 46% of SME book Tourism 4.5% Dollar denominated 12.3% Restaurants 0.2% Ai

  53. Slide 53: Insurance and Annuities P&L 2022

     Insurance and Annuities P&L 2022 Insurance P&L + Annuities P&L = Insurance & Annuities P&L Premium Technical Premium Revenue Reserves Revenue ∆ ∆ = Technical Non-Interest = Technical Non-Interest Result Income ∆ Result Income Premium = Technical Result Non-Interest Claims Revenue Technical Income

  54. Slide 54: Corporate Responsibility and Sustainability

     Corporate Responsibility and Sustainability Global Initiative Report (GRI Standards) UNEP Finance Initiative International standards on sustainability reporting and disclosure of Initiative that aims to identify, promote and carry out the adoption of best economic, environmental and socialtopics.

  55. Slide 55: Contact Information and Reports

     Contact Information and Reports If you have any information request or comments, please contact Banorte's Investor Relations Department at: Tel: (52) 55 1670 2276 E-mail: investor@banorte.com We recently published the 1Q23 report. During 2023 we have released: 1. Annual Report 2022 to the Banking

  56. Slide 56: Economic and Financial Perspectives

    Main macro view Resilience in Mexican economic activity in 2023… Economic and …but with lingering risks amid increased global uncertainty Financial Perspectives Nearshoring and long-term opportunities and challenges A solid banking sector DB Div BAP Eco 56 NIM Rev NI ROE TI L D Dep Loan ICAP Guid Mk

  57. Slide 57: Forecasts of main economic and financial variables

     Forecasts of main economic and financial variables Forecasts of main macroeconomic and financial variables in Mexico End of period 2020 2021 2022 2023F 2024F GDP (% y/y) -8.1 4.8 3.1 2.0 2.3 Inflation (% y/y) 3.2 7.4 7.8 4.8 3.7 Exchange rate USD/MXN 19.91 20.53 19.50 18.70 19.40 Banxico’s referen

  58. Slide 58: We revised our 2023 GDP higher, boosted by several positive domestic factors

     We revised our 2023 GDP higher, boosted by several positive domestic factors 2023 GDP: Supply 2023 GDP: Demand % y/y nsa; % q/q sa % y/y nsa; % q/q sa % y/y 1Q23 2Q23 3Q23 4Q23 2023 % y/y 1Q23 2Q23 3Q23 4Q23 2023 GDP 3.7 2.7 1.7 0.3 2.0 GDP 3.7 2.7 1.7 0.3 2.0 Private 4.1 2.9 2.4 1.2 2.6 consumpti

  59. Slide 59: The recovery has been heterogeneous

     The recovery has been heterogeneous, with room still to be made up in certain states and sectors Economic activity level in 4Q22 vs. the most recent peak State activity level in 3Q22 vs. the most recent peak (1Q19) (1Q19) %, using seasonally adjusted figures %, seasonally adjusted figures Corporat

  60. Slide 60: However, Mexico will continue growing at different speeds

     However, Mexico will continue growing at different speeds Economic growth by state % y/y, 2015-2019 average 2015-2019 Average GDP 1.5+ 0 to 1.5 <0 Source: INEGI DB Div BAP Eco 60 NIM Rev NI ROE TI L D Dep Loan ICAP Guid Mkt ESG Hist C/I App

  61. Slide 61: Nowcasting Economic Activity – IGAE (GDP proxy)

     Nowcasting Economic Activity – IGAE (GDP proxy) Nowcasting of Monthly Economic Activity - IGAE % y/y; nsa 30 IGAE Nowcast IGAE Nowcast 4.7 4.5 4.4 20 3.9 3.8 10 3.4 3.2 2.8 2.8 2.6 2.8 0 -10 -20 -30 Mar-18 Jan-19 Nov-19 Sep-20 Jul-21 May-22 Mar-23 Oct-22 Nov-22 Dec-22 Jan-23 Feb-23 Mar-23 Source:

  62. Slide 62: Performance of households' expenditures

     Performance of households’ expenditures Households’ Expenditures – Resilient Sectors Households’ Expenditures – Vulnerable Sectors Debit & Credit Purchases; January 1st, 2020 = 100 Debit & Credit Purchases; January 1st, 2020 = 100 Supermarkets Accommodation and Food Services 250 200 Healthcare Tra

  63. Slide 63: Performance of businesses revenues

     Performance of businesses revenues SMEs’ Revenues – Resilient Sectors SMEs’ Revenues – Vulnerable Sectors POS Billing; January 1st, 2020 = 100 Debit & Credit Purchases; January 1st, 2020 = 100 300 Retail Sales 450 Professional Services Healthcare 400 227.4% 250 Manufacturing Recreation, Sports and

  64. Slide 64: Inflation will come down slowly, but enough for Banxico to start an easing cycle

     Inflation will come down slowly, but enough for Banxico to start an easing cycle late in the year Inflation forecast Reference rate’s trajectory % y/y fortnightly frequency % 14 12 13 2023: 11 2022: 12 11.50 10.50 11 10 2022: 10 7.8% 9 9 8.25 8 8 7 7 6 2023: 6 5 4.8% 5 4 3 Headline 4 2 Core 4.00 1

  65. Slide 65: Market volatility, inflation concerns, and central bank actions impact currencies

     Market volatility, inflation concerns, and actions from central banks have impacted currencies, albeit with idiosyncratic factors still at play 2023 performance vs. USD USD/MXN forecast %, YTD Pesos per dollar HUF 8.1 MXN 8.1 23.85 Forecast COP 7.3 22.60 CLP 7.2 IDR 4.9 21.35 BRL 4.0 PLN 3.8 20.10

  66. Slide 66: Public finances – Rosy estimates for 2023

     Public finances – Rosy estimates for 2023 MoF: Macroeconomic assumptions and fiscal variables* Historical Balance of Public Sector Borrowing Requirements (HBPSBR) 2023 2024 % of GDP 55 Actual GEPC (Sep'22) Pre-GEPC (Apr'23) GDP (% y/y) 3.0 (3.0) 3.0 (2.4) 51.6 50.8 49.5 49.9 49.9 49.9 49.9 49.9 49

  67. Slide 67: Political highlights in 2023

     Political highlights in 2023 2023’s relevant dates in the political agenda Composition of the Lower House and Senate Lower House, Seats Absolute Governorship elections in majority: 251 Qualified Coahuila and the State of Deadline for the PVEM majority: 334 Mexico submission of the 2024 PT MC Moren

  68. Slide 68: Trends in 2023

     10 global factors to consider in 2023 1 Ukraine war and other geopolitical factors 2 Possible global recession 3 Inflation and monetary policy 4 Supply chain normalization Nearshoring and 5 Pandemic aftermath 6 Commodities performance 7 new trends in international trade 8 Energy transition 9 Digit

  69. Slide 69: Economic activity could be affected by a recession in US

     Economic activity could be affected by a recession in US GDP growth in US and Mexico Mexico GDP growth estimates* % y/y, 1990 to 2021 % y/y 8 2023 2024 y = 1.2349x - 0.5801 1996 1997 6 R² = 0.4664 Banorte 2.0 2.3 1990 2010 1994 2021 2006 2000 1998 Consensus 1.6 1.8 4 1991 2011 2012 2015 2004 2022

  70. Slide 70: US Economic Influence – Sectors of Mexico

     US Economic Influence – Sectors of Mexico US Economic Influence in the Mexican Economy % of GDP 56% Real estate services 56% of Mexico’s GDP depends on the US economy. US Dependent Non-US Dependent Source: Banorte DB Div BAP Eco 70 NIM Rev NI ROE TI L D Dep Loan ICAP Guid Mkt ESG Hist C/I App

  71. Slide 71: US Economic Influence – GDP by Mexican States

     US Economic Influence – GDP by Mexican States US Economic Influence Top 7 States with High US Economic Dependency 1.- Veracruz 2.- Zacatecas 3.- Guerrero 4.- Nuevo Leon 5.- Yucatan 6.- Sonora 7.- Estado de Mexico Top 7 States with None US Economic Dependency 1.- Baja California Sur 2.- Chihuahua 3

  72. Slide 72: Mexico's geographical location, demographics and natural resources key drivers

     Mexico's geographical location, benign demographics and natural resources (among other factors) remain as key drivers for the economy Real GDP growth FDI Population pyramid in 2020 % y/y US$ billion in nominal terms Million people by age bracket 10 6.8 Utility reinvestment and accounts between 85+

  73. Slide 73: Nearshoring impact in Mexico

     Nearshoring impact in Mexico Total impact from nearshoring in the next 5 years: US$168bn *Using 2022’s total of US$539 billion as a baseline, Source: Banorte with data from INEGI, Banxico and BEA; Images: freepik.es DB Div BAP Eco 73 NIM Rev NI ROE TI L D Dep Loan ICAP Guid Mkt ESG Hist C/I App

  74. Slide 74: Top investments in the auto sector in 2022 and so far in 2023

     Top 5 investments in the auto sector in 2022 and so far in 2023 Note: Tesla’s investment is based on different media reports, including Reuters Source: Press releases DB Div BAP Eco 74 NIM Rev NI ROE TI L D Dep Loan ICAP Guid Mkt ESG Hist C/I App

  75. Slide 75: Mexico has benefited previously from similar investments

     Mexico has benefited previously from similar investments, driving structural changes across several industries Mexico: Non-oil exports to the US: Top five goods imported from US: Vehicle imports by country world* Mexico % of total vehicle imports (yearly figures) US$ billion, 2015 constant prices

  76. Slide 76: The main destination of Mexican exports is Texas, followed by Michigan and California

     The main destination of Mexican exports is Texas, followed by Michigan and California US: Imports from Mexico US$ billion, 2022 99.2 Source: Ministry of Economy DB Div BAP Eco 76 NIM Rev NI ROE TI L D Dep Loan ICAP Guid Mkt ESG 76 Hist C/I App

  77. Slide 77: Export centers are concentrated in the north and center of Mexico

     Export centers are concentrated in the north and center of Mexico Mexico: Exports to US US$ billion, 2021 Source: Ministry of Economy DB Div BAP Eco 77 NIM Rev NI ROE TI L D Dep Loan ICAP Guid Mkt ESG 77 Hist C/I App

  78. Slide 78: Banking credit forecast using lagged GDP

     Banking credit forecast using lagged GDP Banking credit Backtest and forecast* $ billons % y/y in real terms 4,700 Adjusted model Year Observed Original model (dummy 2020) Forecast 4,200 Fitted 2019 4.6 5.5 2020 1.1 1.7 3,700 Observed 2021 -8.6 -8.8 -8.6 3,200 2022* 2.1 1.4 1.2 2,700 2023* 4.6 4.6

  79. Slide 79: Banking sector KPI's

     Banking sector KPI’s Capitalization ratio Non-performing loans ratio % of net capital / credit risk assets % of total loan portfolio 40 10 Capitalization ratio 35 Banking sector's average 9 30 Total Consumer 25 8 22.02 Mortgage Firms 20 7 15 19.27 6 10 5 5 0 4 Autofin Credit Suisse Banregio Multiv

  80. Slide 80: Financial access in Mexico

     Financial access in Mexico Key FAS Indicators Outstanding deposits with commercial banks % GDP 30 28.85 2016 2017 2018 2019 2020 Number of ATMs per 100,000 adults 54.59 55.62 58.82 61.54 62.13 25 Number of commercial bank branches per 14.02 14.03 13.86 13.73 12.79 20 100,000 adults 2012 2013 2014

  81. Slide 81: State economic activity and Banorte's regional reach

     State economic activity and Banorte’s regional reach Heat Map: Contribution to Economic Growth Branch Network per Federal Entity % GDP, contribution points # of branches Average Net Income per Federal Entity Source: Análisis Económico Banorte DB Div BAP Eco 81 NIM Rev NI ROE TI L D Dep Loan ICAP G

  82. Slide 82: L D Dep @alexpadillasan

    DB Div ICAP BAP Eco 82 NIM Rev NI ROE TI L D Dep@alexpadillasan Loan Guid Mkt ESG 82 Hist C/I App de BANORTE

Grupo Financiero Banorte — Q1 2023 Earnings Presentation on 6ix