Argentine Banks: Better NIM To Offset Lower Growth - Increasing Estimates into 2Q26

Research evidence excerpt

Argentine Banks: Better NIM To Offset Lower Growth - Increasing Estimates into 2Q26

J P M O R G A N Latin America Equity Research

24 June 2026

Argentine Banks

Better NIM To Offset Lower Growth - Increasing

Estimates into 2Q26

We recently met with Argentine banks to discuss macro and sector-specific trends. Latin American Financials

ACOverall, the tone was slightly more constructive on margins, which could expand, Yuri R Fernandes

helped by lower funding costs: private bank BADLAR (i.e. cost of 30-35 day (1-212) 622-3400

deposits) is tracking at ~21% vs. ~30% in 1Q26, while asset yield repricing was yuri.r.fernandes@jpmorgan.com

more limited. We believe this will drive ROE recovery—believe most investors J.P. Morgan Securities LLC

called for flattish or decreasing NIM, which could drive EPS upside risk. However, Guilherme Grespan

regulatory figures remain negative for asset quality (i.e. NPL still increasing), and (55-11) 4950-3058

guilherme.grespan@jpmorgan.com

loan and deposit growth (especially in ARS) continues to be lackluster. Notably, Banco J.P. Morgan S.A.

ARS loans are growing at ~2.5% M-o-M pace, not much above 2.1% inflation in

Fernanda Sayao

May. We revised our 2Q26 EPS by +6-7% and increased our 2026 estimates by (55-11) 4950-6588

4-8% for Galicia and Macro, respectively. We see the current risk-reward as fernanda.sayao@jpmchase.com

attractive, with the stocks trading at 1.2-1.5x P/BV for companies with ROE Banco J.P. Morgan S.A.

improving, while CDS is moving lower (now ~430bps from ~560bps in January) Diego Marquez Antonio

and an economy that is growing. While NIM recovery may eventually fade, we (52-55) 5339-94899

believe banks have potential loan growth and asset quality normalization as diego.marquez@jpmorgan.com

tailwinds into 2027.