Grupo Financiero Galicia(GGAL) - 2024 Q4 - Annual Report

Financial Performance - Banco Galicia's Gross Brokerage Margin (GBM) for the first year is limited to a potential loss of 12%, with a negative difference of -3.04% recorded under the "+400/200 bps" scenario compared to the base scenario [1527]. - As of December 31, 2024, Banco Galicia's consolidated GBM showed a variation of 85,363 million Pesos (2.18%) under a 200 bps increase in interest rates [1529]. Risk Management - The Risk Management Division is responsible for identifying and managing various risks, ensuring the board is fully aware of the exposure [1518]. - The Risk Management Committee has executive responsibility for defining and enforcing risk management policies and monitoring compliance [1519]. - The methodology for calculating interest rate risk includes a "critical" scenario derived from statistical simulations of historical interest rate data [1533]. - The maximum tolerable losses for total risk (currency + fixed-income instruments + interest rate derivatives) were set at Ps.64,528 million [1562]. Currency Exposure - Banco Galicia's net asset position in foreign currency was Ps.37,157 million (US $36 million) as of December 31, 2024, after adjustments for forward purchases [1538]. - The impact of a 40% increase in the Peso's value relative to the Dollar would result in a gain of 52,020 million Pesos, while a 40% decrease would lead to a loss of 22,294 million Pesos [1540]. - Banco Galicia has established limits for foreign currency mismatches at 12% and +30% of the bank's computable regulatory capital (RPC) [1537]. - As of December 31, 2024, Grupo Financiero Galicia's foreign currency assets totaled Ps.9,599,309 million, including Ps.5,915,544 million in cash and balances [1548]. - The liabilities in foreign currency amounted to Ps.9,641,583 million, primarily consisting of Ps.7,732,118 million in deposits [1549]. - The net liability position from the consolidated balance sheet was Ps.17,682 million, with a net asset position in foreign currency of Ps.184,271 million, equivalent to US$ 178.5 million [1550]. - Banco Galicia's net liability position in foreign currency represented -6.3% of its computable regulatory capital (RPC) at fiscal year-end [1551]. - As of December 31, 2024, overseas foreign currency transfer risk exposure was 6.61% of total liabilities, below the 15% limit [1566][1567]. Asset and Liability Management - The total gap in financial assets and liabilities as of December 31, 2024, was 6,063,744 million Pesos, with a significant portion in Pesos adjusted by UVA [1546]. - Non-adjusted Peso-denominated assets were Ps.10,904,639 million, while non-adjusted liabilities were Ps.10,741,917 million, resulting in a net asset position of Ps.2,839,842 million [1552]. - The net asset position adjusted by UVA was Ps.2,811,270 million, primarily from government securities and loans [1553]. - Other assets included property, plant, and equipment valued at Ps.1,358,662 million [1555]. Interest Rate Risk - The net present value of assets and liabilities is calculated monthly, with a limit on interest rate risk exposure not exceeding 15% of consolidated Tier 1 capital; as of December 31, 2024, the "Value at Risk" was -5.70% of Tier 1 capital [1536]. - As of December 31, 2024, overseas foreign currency transfer risk exposure was 6.61% of total liabilities, below the 15% limit [1566][1567]. Support to Public Sector - Banco Galicia provides financial assistance to the non-financial public sector through government securities and direct loans [1569].