Good morning, ladies and gentlemen. Welcome to Itaú Unibanco Holding Conference Call to discuss the 2020 First Quarter Results. As a reminder, this conference is being recorded and broadcast live on the Investor Relations website. A slide presentation is also available on this site. Before proceeding, let me mention that forward-looking statements are being made under the safe harbor of the Securities Litigation Reform Act of 1996. Actual performance could differ materially from that anticipated in any forward-looking comments as a result of macroeconomic conditions, market risks and other factors. With us today on this conference call in São Paulo are Mr. Candido Bracher, President and CEO; Mr. Milton Maluhy Filho, Executive Vice President, CFO and CRO; Mr. Alexsandro Broedel, Executive Director, Group Head of Finance and IR; and Renato Lulia Jacob, Head of IR and Market Intelligence. First, Mr. Candido Bracher will comment on 2020 first quarter results. Afterwards, management will be available for a question-and-answer session. It is now my pleasure to turn the call over to Mr. Candido Bracher.

All right. Good morning, everyone, and thank you for taking the time to attend our first earnings call of 2020. I hope you're all well and safe. To start our presentation, let's move straight to Slide 2, please. Before discussing the financials, we cannot obviously avoid talking about the crisis we are all going through and its impact on our lives and consequently, its impact on our results. By mid-March of this year when the crisis broke out, it became evident that the extensions were becoming more apparent as days go by, but they were not yet completely clear. So I would like to use today's first 3 slides as a segue to the presentation we did on April 6 in order to discuss and update you on the different initiatives we have put in place to deal with the impact of COVID-19 in our company and in our community. Since the very beginning, it became evident to us that we needed to step up and act proportionally to the role we have in Brazil as the largest financial institution in the country and in Latin America. So we first began by ensuring we could operate normally under very exceptional circumstances. We were very quick in moving 95% of all of our workers from central administration, call centers, and digital branches to work from home remotely. In our brick-and-mortar branches, we have taken every measure possible to ensure our employees and clients are safe. This has included, among other things, the supply of masks, safety equipment, implementing social distancing measures, and reinforcing hygiene protocols. We also wanted to make sure our teams have the support and peace of mind to focus all their attention on serving clients. So we announced additional measures, such as firm-wide job security by suspending all terminations without cause, and we also advanced the payment of the 13th salary. Our teams are now tirelessly working on developing the best solutions to help our clients. We reinforced and improved our digital channels, which are now operating at their highest historical availability level. In the last weeks, account openings through digital channels more than doubled in absolute terms. We have intensified our communication significantly, both internally and externally, and we are receiving very strong satisfaction ratings. For example, our employee Net Promoter Score has reached 92 points over the last few weeks, which represents an increase of 22 points compared to February. However, while all those initiatives are vital, they are just part of our response to the crisis. We felt we needed to act proportionally to our relevance in Brazilian society. With this in mind, we launched an initiative called Todos pela Saúde, Everybody for Health program. We have donated BRL 1 billion specifically to this initiative and another BRL 300 million for scattered actions against the pandemic. For Todos pela Saúde, we have formed a group of distinguished health specialists responsible for directing resources so that all strategic decisions regarding these funds are backed by technical and scientific elements. We are inviting others to join us in this initiative. Moving now to Slide 3, let's briefly review some important initiatives we launched at our retail bank to support individual clients and SMEs navigating through these difficult times. We started by providing a 60-day grace period on loans in general, which we have doubled for individuals who were up to date with their payments, and tripled for small companies with reduced interest rates. Additionally, we are offering to extend the terms of contracts so that the installments adequately fit the cash flow of clients after the grace period ends. This initiative aims to enable our clients to get their finances back on track after we surpass this crisis. By the end of last week, over 850,000 clients had refinanced their loans under these terms. We have also announced several other initiatives in the past 30 days to extend benefits and exemptions for our clients to support the liquidity of small and medium-sized companies and their transition to the delivery sales model during the social distancing phase we are currently going through. Let's now move to Slide 4. You'll see that the work we've been doing in our wholesale bank has not been any different, aiming to support our clients in the best possible way. Right after the crisis began, there was an increased demand for liquidity, especially from corporate clients. So we utilized our balance sheet and doubled our credit origination across various industries with very good credit ratings. For middle-market companies, we are now offering a 90-day grace period for amortizing credits and have proactively supported larger companies by postponing the maturities of loans expiring in the months ahead. We significantly intensified our communication with clients through different channels. One interesting fact we have observed is that bankers can now conduct many more virtual meetings with clients in a day instead of physical visits. It's also worth mentioning the large amount of specialized daily content we are providing clients to assist them in their investment decisions. This is the backdrop of what we are living today, a health crisis whose duration and depth of impact we still do not fully understand. With that said, going back to my initial comments regarding ensuring the bank operates normally, we took decisive steps to make our balance sheet even more resilient, as will be outlined in the upcoming slides. Now moving to Slide 6 and the financial highlights. We finished the first quarter of 2020 with a BRL 3.9 billion recurring net income and a 12.8% ROE. Although we had a good start to the year, especially in the first two months, this quarter's results have already incorporated some effects of the crisis. This is most evident in the reinforcement of our balance sheet with the additional provisions indicated by our expected loss model, which will be discussed further later in this presentation. During the quarter, our loan book grew by 8.9%, mainly reflecting the increase in credit origination, particularly from corporate clients, along with the impact of the Brazilian real devaluation. Additionally, we achieved another strong quarter in terms of cost management, posting a nominal contraction of 0.8% compared to the first quarter of 2019 and a 7.3% decrease sequentially from the last quarter. This is a result of our ongoing focus on technology, automation, and our discipline in streamlining our processes and structures. Now moving to Slide 7 for more on our credit portfolio. We observed an 18.9% expansion in our loan portfolio over the last 12 months. The quarter's growth was chiefly led by our wholesale portfolio, particularly corporate loans, reflecting our support for our clients' liquidity needs. Our credit origination in Brazil rose by 36% compared to the first quarter of last year, with a notable 72% increase for corporate clients. Even considering the first two months of the year, credit origination had already increased by 22.5% in Brazil, exhibiting a 30% rise for corporate clients. Additionally, we also witnessed an acceleration in our funding from clients, reflecting a demand for more conservative investment products during this period. Moving to Slide 8, which displays the profile of our credit portfolio, showcasing our high credit exposure by business line, client concentration, and specialty industry. The highest industry concentration in our portfolio is real estate, representing only 3.7% of our book. Sectors most impacted by the crisis, such as oil and gas, leisure and tourism, and airlines, account for only 2.4% of our total credit portfolio. Lastly, regarding currency diversification, it is important to highlight that all credit operations are naturally hedged as they are funded in the respective currency. Now we move to Slide 9, where we explain our expected loss provisioning model. This section outlines our loan loss provisions and how the bank's expected loss model operates. This model has been utilized since 2010 and is consistently evolving. It functions differently for wholesale and retail clients. In wholesale, the approach is more bottoms-up, where clients are individually assessed and discussed in credit committees. Meanwhile, for retail, we leverage statistical models examining numerous variables, incorporating a relevant share of artificial intelligence given the extensive volume of clients and transactions. This description provides insight into how we consolidate all available information to estimate future credit losses, thus anticipating provisioning needs. On the right side, you will find a breakdown of our loan loss provisions. The total provisions rose from BRL 39.7 billion to BRL 47.1 billion, representing a total increase of BRL 7.4 billion, of which BRL 5.2 billion resulted from potential losses stemming from the crisis's expected impacts on clients without delinquent debts. The financial statements will feature a detailed breakdown of those provisions, where labels may differ but fundamentally serve the same purpose: to prepare our balance sheet for future losses. Moving now to Slide 10, we see the cost of credit. What I mentioned previously resulted in an increase in our cost of credit during the quarter to BRL 10.1 billion, corresponding to 5.5% of our total credit portfolio and boosting our coverage ratio by 10 percentage points to 239%. On Slide 11, still regarding credit quality, we present a longer-time series of provisions and nonperforming loans to illustrate that we maintain a relatively stable NPL level at 3.1%, alongside a high level of provisions and coverage at 6.6%. We strongly believe that this approach is prudent. Moving to Slide 12, let's review the financial margin with clients. The net interest margin decreased by 80 basis points during the quarter. As shown in the chart at the bottom of this page, the main impact originated from the new overdraft loan regulation that took effect at the beginning of the year, impacting BRL 600 million. The remaining decrease is attributed to the reduction in interest rates affecting our working capital and liabilities margin. It is important to mention that we purposefully decided not to offset the impact of the overdraft cap through increased exposure to high-yield portfolios, thus growing our balance sheet. Quite contrary, we actually reduced our exposure to credit cards and personal loans by 3.4% this quarter. Given the backdrop brought by this crisis and hindsight, we believe it was a sound decision. Slide 13 focuses on financial margin with the market. The first quarter has not been a favorable one for our trading desks. The interest rate declines also affected the remuneration of our hedge positions and investments abroad. On Slide 14, we see commissions, fees, and results from our insurance operations. These revenues declined by 8.2% quarter-on-quarter, primarily due to an exceptionally strong performance in the previous quarter. When viewed on a yearly basis, they showed an increase of 8.2%. Particularly, asset management and advisory services and brokerage lines have seen a decline that is partially explained by current crisis effects but still present strong performance on a 12-month basis. Asset management rose by 40.2%, and investment banking peaked at 148.1%. As highlighted on the right, from January '19 to March this year, we maintained the top spot in major investment banking rankings, leading in M&A and ECM in both Brazil and Latin America, as well as in DCM in the domestic market. Comparing our fee revenues with last year’s first quarter, the 8.2% decline translates into an 8.2% increase, with the decline primarily resulting from the acquiring results. It is also notable that the impact of the T+2 offer, extended to all clients by the end of the year, did not exist in the first quarter of last year. Now on Slide 15, we examine noninterest expenses, which decreased by 0.8% year-on-year, significantly below the 3.3% inflation during the same period, reflecting a solid performance. It's important to emphasize that personnel and administrative expenses were reduced by over 2% over the same period. As previously mentioned in earlier earnings calls, this is due to strategic cost management and an emphasis on efficiency. We perceive this as an ongoing process—that we anticipate continued positive results in upcoming quarters. Nonetheless, we haven’t ceased investing heavily in key areas crucial for the future of our bank. In the past 12 months, we’ve hired an additional 640 IT technicians and acquired Zup, a technology service provider adding another 800 specialists. In total, we increased our technology development capacity by 54% from 2016 to 2019, and we aim to further enhance this trajectory. This crisis is providing daily lessons on how we can operate more efficiently, and we are confident this will yield further benefits in the near future. Moving to Slide 16, we finished 2019 with a 14.4% Tier 1 capital ratio. In March, we paid dividends from '19 results, which caused the ratio to decline by 1.1 percentage points. Other negative impacts arose from mark-to-market securities, tax credits, and RWA growth, influenced by foreign exchange variations, either through tax effects from our investments abroad or the significant growth in credit risk-weighted assets. The first quarter results came in lower than initially anticipated. On the other hand, the same exchange rate variations partially offset these negative influences through the valuation of our dollar-denominated additional Tier 1 capital. Finally, we issued $700 million in AT1 bonds, well-timed before the onset of the crisis, which brought our Tier 1 capital ratio to 12% at the end of March 2020. I’d like to mention that we conduct stress tests weekly; even in scenarios where the U.S. dollar appreciates, our capital base remains capable of absorbing the resulting impacts. Moving to Slide 17, we provide a table estimating 2020 GDP in Brazil according to the timing of social distancing measures unwinding and the subsequent pace of economic activity recovery. Naturally, the longer it takes for lockdown measures to ease, the greater the economic impact will be. We believe the scenarios on the left are the most likely to materialize when we modeled our loan loss provisions, among other variables. As illustrated, we are confronting extreme uncertainty regarding macroeconomic conditions, resulting in a broad range of estimates. Moving to the final slide regarding perspectives: due to the low visibility and uncertainty about the extent and duration of the current crisis's social and economic impacts, we have suspended the 2020 forecast previously disclosed during our fourth-quarter earnings release. Nonetheless, I want to emphasize that our financial margin with clients, noninterest expenses, credit portfolio, and fee income ended the first quarter of the year in line with or better than the guidance we provided earlier. However, we view it as prudent not to disclose new forecasts until we can more accurately estimate impacts and the scale of the current situation on our operations. Nevertheless, I’d like to share with you our main perspectives for our business. Firstly, capital and liquidity should remain at appropriate levels, in light of our internal stress test scenarios. Regarding the credit portfolio, primary growth drivers in the short and medium term will include increased participation of the corporate banking portfolio, lower individual demand, and a relatively high volume of renegotiations. We believe the financial margin with clients will grow in parallel with credit portfolio growth. Commission fees and insurance results will remain pressured due to reduced economic activity and limited capital markets. The cost of credit and loan loss provisions, as indicated by our expected loss provisioning model, will be modified whenever there are significant alterations in the macroeconomic landscape and clients' financial conditions. Lastly, we maintain our commitment to nominally reduce noninterest expenses, reflecting diligent and strategic cost management, investments made in technology, the effect of lower economic activity on our variable costs, and the gains from the new remote work and service model. With that, I conclude this presentation and we may start the Q&A session.

Today's first question comes from Jason Mollin with Scotiabank.

I just wanted to follow up a little bit on the information you provided on the business model slide, where you're comparing the recurring net income from credit, trading, insurance, and services, and excess capital. With the cost of credit that you booked over BRL 10 billion this quarter, you are showing negative value creation. It is interesting you're showing recurring net income of zero in the credit segment. Can you discuss that? We've seen this in the past during the last recession when you talked about some of the commoditized products that are challenging to generate profit in this environment. But I was looking at this more from the cost of equity perspective to understand how you're calculating this value creation.

Thank you, Jason. If I understood your question correctly, you want details regarding our value creation methodology, specifically which cost of capital we are using, correct?

Correct.

We define our cost of capital in monthly meetings with the Risk Committee of our Board. To be precise, we follow four different formulas, which we provide them, and then we set the level. Before the crisis began, we were at 12%. Following the onset of the crisis, we tightened the level to 12.5%, and we are already approaching 13% for this cost of capital. This adjustment is made despite anticipating a significant reduction in interest rates, both internationally and domestically in Brazil. However, when considering other risk factors in these transactions, we deem it appropriate to maintain a higher cost of capital.

That's helpful. As a second question, could you comment on the capitalization at the consolidated level? You mentioned the decrease in risk-weighted assets and the payment of IOC and dividends. If you could talk about that dynamic—clearly, you have a minimum in your bylaws. We've seen banks pursue rights offerings if necessary to enhance capital. Should we be considering that as an option in this environment?

No. We are not considering a rights offering at this time, Jason. So far, this crisis has demonstrated the adequacy of our established high minimum capital level at 13.5%, as we have repeatedly stated. This has enabled us to absorb the significant impact of the crisis. To summarize, we faced a 69% decline in dividends and IOC payment, smaller profits in this first quarter, along with the capital impacts from both portfolio growth and foreign exchange fluctuations. Overall, these factors contributed to a marked decline in our capital level from 14.4% to 12%. However, we took timely action by issuing AT1 bonds, which benefited from the dollar. Looking ahead, I anticipate that dividend pressures will be much lower. According to Central Bank regulations, we can only pay out a maximum of 25%. While I cannot predict the dividend payout amount, it will certainly be much lower than last year. The growth rate of our portfolio will depend largely on demand and our capacity to meet it, and we have not observed a tremendous growth in demand. Initially, we experienced a surge in demand when large corporations sought liquidity at the onset of the crisis, but that has since tapered off. Demand remains normal for corporate clients, while we observe significantly reduced credit demand from individuals. Regarding our overhedge policy on foreign investments, we control our exposure to currency fluctuations. If we consider it prudent to minimize hedging our foreign investments, we can easily adapt. We perform weekly capital stress tests, focusing on exchange rate variables, and are equipped to manage our capital level effectively.

Our next question comes from Tito Labarta with Goldman Sachs.

A couple of questions as well. First, in Slide 17, you show various expectations for the economic outlook based on when the lockdown ends. Can you provide details regarding the scenario used to determine the provisions booked this quarter? The cost of credit at 5.5% is significantly higher than anything we've seen in the last five years, and I cannot help but believe it won’t peak as it did during the global financial crisis. Could you elaborate on the scenario you used for this assessment? Further, historically, in 2016, the cost of credit peaked at 4.4% in the first quarter and gradually decreased thereafter. Based on current conditions, do you foresee a similar trajectory, given that you've already made the necessary provisions upfront? Or do you think risks are even greater this time?

Of course, Tito. This is more an art than a science. We are navigating a landscape with numerous variables. In addition to those featured in the table on Page 17, we must consider the extent of public fiscal support foreseen for the economy. We also question whether a specific GDP drop's impact on companies mirrors the decline experienced during '15 or '16, which transpired gradually. Currently, however, we maintain a cautious outlook. Regarding the lockdown in Brazil, our observations are not particularly optimistic. The contagion index remains around 3.7, indicating a peak is still ahead of us. Thus, the lockdown could extend longer. We believe a prolonged lockdown will result in a slower recovery since people will emerge less financially stable and companies more affected. Considering these variables, I think it’s hasty to conclude that we've already peaked concerning provisions. We must closely monitor the economy's performance and individual and corporate behavior over the next quarters to determine adequacy in our provisioning.

That's fair, I appreciate it. For a quick follow-up on the coverage ratio, today it's 239%, slightly below the peak we witnessed at 248% in 2018. Do you feel comfortable with the current coverage ratio? Should we anticipate that you will need to raise it further? Offer us some context on how you view your coverage ratio in today’s environment.

It’s reasonable to expect a higher coverage ratio amid this crisis because nonperforming loans lasting 90 days tend to be rolled over during the renegotiation period. When we consider this effect, it naturally means a reduction in the denominator in terms of loans. Consequently, a higher coverage ratio is likely due to this phenomenon.

Our next question comes from Mario Pierry with Bank of America.

Hello. Can you hear me?

Yes. I can hear you.

Okay. Sorry about that. Two questions from me as well, Candido. On Slide 3, you reveal that 850,000 clients had already renegotiated their loans based on various options offered. Could you clarify what percentage of clients that qualified for these offers have applied? Additionally, what is the nominal balance of these renegotiated loans? Were these renegotiations finalized by the end of March or more recently? I'd like to understand how much more renegotiation activity you anticipate. My second question pertains to your outlook for NII going forward: you indicated it should increase in line with loans. However, given that the majority of growth is projected to stem from the wholesale sector, I would expect a lower margin relative to the previous year. Could you clarify this for me?

Sure, Mario. Regarding your second question, you're correct to note that loan growth will be primarily concentrated in larger corporations rather than SMEs and individuals, leading to smaller margins. However, we expect margins for large corporations, particularly for these clients, to increase based on the bond prices of these companies in the secondary market. Thus, the expected margin growth could offset the differences from the portfolio mix. Regarding the rollover—approximately BRL 30 billion in contracts have been rolled over for the 850,000 clients. I don’t have the exact percentage representing eligible clients. In the initial weeks, we observed about 85% of people making payments rather than seeking renewals. Consequently, the rollover was less than I initially anticipated, but I believe this proportion will rise as time goes on.

And our next question today comes from Thiago Batista with UBS.

I have two questions. The first pertains to deposits. The funding side of the bank, particularly deposits, surged in Q1. Can you explain this movement? Was it a type of flight to quality? Was it concentrated mainly in corporate or retail? Please clarify this substantial deposit growth. Secondly, regarding the measures taken by Itaú and other banks recently, specifically about the postponement of installments—do you believe it will be necessary to extend this grace period in the upcoming months? Furthermore, concerning the BRL 40 billion fund for financing small companies' payroll, could you share your perspective on this fund? Is Itaú actively using it, and do you believe this amount is sufficient, or do you need more?

Thanks for your questions, Thiago. Let’s tackle them one by one. On the deposit side, I must say we had already decided to increase our direct funding before the crisis began due to growth trends we were observing in our portfolio. When the crisis hit, we were positioned well. I think there has indeed been a movement, though we might not characterize it strictly as a flight to quality. However, it is true that people have become more conservative and are seeking safer products. Thus, liquidity has not posed any significant issues at the start of this crisis. Regarding the postponement of installments, it will depend very much on the specific sectors of the companies. Some sectors may experience quicker recoveries than others, necessitating potentially longer timeframes to resume sales. We will need to assess this on a sector-by-sector basis to accurately gauge individual sector needs and recovery possibilities. As for the BRL 40 billion payroll fund, it appears that the initial estimate may have been exaggerated, based on miscalculations. While we are actively pursuing loans under this program, we currently hold about 33% to 34% market share in this particular line, slightly above our usual payroll market share. However, demand remains below potential, even in this realm. Two factors influence this: First, some companies owe payments to social security (INSS) and thus do not qualify for the loan. Second, there are tied conditions, like maintaining employment for 60 days, that some companies may be hesitant to accept.

Our next question comes from Geoffrey Elliott with Autonomous Research.

First, just a quick clarification. The BRL 30 billion of loan balances that have been rolled over—what was the date for this figure? Was it from March 31 or more recent?

It’s a more recent figure.

Can you specify which date?

I don’t have the exact date, Geoffrey. It must be no older than a week.

Understood. My broader question relates to your plans for lowering expenses. You've referenced how this crisis has provided insights on improving operational efficiency, such as enabling employees to work from home and facilitate online account openings. How do you envision the bank's future structure post-crisis, and do you anticipate any significant expense savings?

Thank you for your question, Geoffrey. I can cite numerous examples. We will likely travel less and conduct fewer physical visits. We may reduce our office space needs. Overall, there are potential savings, suggesting the likelihood of closing more branches than originally estimated. This transition won’t occur immediately, but over time, people have increasingly embraced digitization. Those aspects represent the strategic initiatives we have underway. I’ll invite Milton to join the conversation for any additional insights, as he leads this efficiency project.

Candido has addressed many of the opportunities we’re assessing following the lockdown. The majority hinge on ongoing remote work setups and decreased travel both locally and abroad. We foresee enhancements in our branch footprint as more clients adopt digital channels, resulting in less need for in-person interactions. Overall, we recognize numerous efficiencies in our workflows and are actively working to solidify these improvements for the future.

And our next question comes from Carlos Gomez with HSBC.

I have a couple of long-term questions. You possess an extensive footprint in Brazil and abroad, and as you've mentioned, trends are not looking particularly favorable. Can you pinpoint specific regions of Brazil that you find more concerning than others, or certain countries where you have operations that raise red flags for you?

Thanks, Carlos, for your question. When considering regions in Brazil, there is significant variation. I believe the northeast region is likely to bear the brunt of the crisis due to its heavy reliance on tourism. While I don’t have the exact figures for tourism's contribution to the northeast's GDP, it is undoubtedly greater than in the southeast or southern regions. Conversely, the northeast has a larger contingent of public workers, who historically retain their employment during these times. However, I don’t have a definite answer. Our concentration remains in the southeast, where industrialization and service sectors thrive, representing the bulk of Brazil's GDP. Consequently, I expect GDP changes in that region to reflect the national average. Regarding possible consolidation stemming from this crisis, we are not currently seeing any indications of that. While small opportunities may arise here and there, the main focus remains on addressing the current challenges and assisting our clients.

What about outside Brazil?

I believe Milton would be better suited to address matters concerning our international operations.

Regarding our operations outside Brazil, we don't perceive any consolidation process currently. As always, we remain open to new opportunities. In the countries we operate, we continue pursuing the same agendas we established in Brazil, emphasizing cost efficiency and digital transformation. We are comfortable with our existing footprint and business scale, so nothing is on the radar in terms of large consolidations.

In terms of public health, are there any particular countries where you are more concerned?

No, in the countries where we operate, we initiated lockdowns relatively early compared to Brazil. The figures for disease spread and mortality appear to be manageable across all those markets. Therefore, we don’t have specific concerns about any particular countries.

And our next question comes from Marcelo Telles with Crédit Suisse.

I have two questions. First, regarding the details on Slide 8 about sector exposures significantly impacted by this crisis. I would like to reconcile that information with the Central Bank's stress test outcomes. On Slide 8, you highlight exposure around 2.5% to the hardest-hit sectors, while the Central Bank indicates direct exposure to COVID-19 affected sectors stands closer to 30%. Could you assist in reconciling why your exposure is notably smaller? I understand Slide 8 may not capture the total exposure. Can you divulge what percentage of your overall portfolio is impacted directly by COVID-19? Additionally, how should we interpret your potential credit losses across those segments? Secondly, regarding your provisioning efforts, you maintain a stronger capital position than others, allowing for enhanced provisioning compared to peers. Moving forward, how should we interpret your capacity to continue front-loading provisions? Is capital your main constraint looking forward? Your current CET1 ratio stands at 10.3%, which is a threshold you’re considering minimally acceptable moving forward. Would you imply that provisioning levels would have to correlate to maintaining the 10% threshold?

That’s a fair question, Marcelo. To address your first inquiry, I don’t have access to the Central Bank study figures here. If you have those figures, please share them with me. All I can offer is that we’ve indicated 2.4% exposure—1.3% in oil and gas, 0.9% in tourism and leisure, and 0.2% for airlines. These represent the most affected sectors. However, many other industries such as non-food retail, automobile, energy, and sugar and ethanol production have also been affected by the pandemic. When considering provisions, we account for risks not only from these sectors listed on Slide 8 but also from many others. The figures presented on that slide reflect our most impacted sectors, which likely explains the notable deviation from the Central Bank’s figures. Regarding capital management, I want to reassure that we won’t face any obstacles maintaining an appropriate capital level in the future. Our provisioning will adhere to the guidelines set forth by our expected loss model. Our current capital level will support continued provisioning as needed, well within our projections and capacity constraints.

So just to follow up; your model requires significantly more provisions than what you currently have on record. I assume your acknowledgment of being the most provisioned bank in Brazil accounts for your current standing. If you have to dip beneath the 10% CET1 ratio threshold, or if you discover other structures for capital raise, would that hinder your ability to make those essential provisions? Is that a fair understanding?

The fair assessment would be to prioritize making necessary provisions. If we require more capital in such scenarios, we will address that then. I don't anticipate this will be a pressing concern.

Would you consider issuing any long-term debt in the current environment to enhance your liquidity coverage ratio, given it stands at a healthy 165%? Is this a potential consideration moving forward?

Currently, liquidity is satisfactory and comfortable. At this time, we are not planning any issuances.

This concludes today's question-and-answer session. For your information, all questions received via the webcast today will be answered by the Investor Relations department. Mr. Bracher, at this time, you may proceed with your closing statements.

I want to thank you all for your interest in today’s conference and the insightful questions raised. These results differ significantly from what we usually present. Additionally, we acknowledge the limitations in ensuring precise responses amid such unprecedented uncertainty. We hope that, by next quarter, we can offer clearer insights and more definitive statements. Thank you very much for your attention.

Thank you. That does conclude our Itaú Unibanco Holding earnings conference call for today. Thank you very much for your participation. You may now disconnect.