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"Sorry, we go low, but we don’t go that low (yet)!” was the emailed reply from a contact at a leading investment bank in response to Euromoney’s question about whether or not its equity research team covered Banco Supervielle.
In fact, it transpired that only three traditional global investment banks cover Supervielle: Bank of America Merrill Lynch, Morgan Stanley and UBS. The first two ran Supervielle’s IPO and are therefore obliged to have coverage.
From one perspective that might make sense: when it launched its IPO, the bank had 1.9% market share of deposits and assets and a 2.5% share in loans. It was the 14th largest bank in Argentina, which is in itself a small market in terms of credit penetration (a 13.7% credit-to-GDP ratio, according to Supervielle’s data).
But, to paraphrase Shakespeare’s Helena in ‘A Midsummer Night’s Dream’, though Supervielle be little, it is a fierce competitor. Look at the numbers.
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The bank’s loan portfolio grew 95% during 2016 and the first six months of 2017, the fastest rate of any Argentine bank and almost double the already-high system average. Even adjusting for Argentina’s high rate of inflation, the portfolio grew by a substantial 25%, while the country’s overall banking sector contracted.
