Banco De Credito E Inversiones · BCS:BCI
Banco De Credito E Inversiones — Q2 2024 Earnings Presentation
30 slides from Banco De Credito E Inversiones's earnings presentation, August 2024
Slide 1: Corporate Presentation 2Q 2024
Corporate Presentation 2Q 2024 Investor Relations Department | Investor_Relations_Bci@Bci.cl August 2024
Slide 2: Bci at a glance
Bci at a glance
Slide 3: Leading financial institution in Chile by Assets and Loans
Leading financial institution in Chile by Assets and Loans Profitable and financially sound Diversified business model Bci/Subsidiary Diversification as of June 2024 • Largest bank in Chile (total loans) • 3rd Largest Florida-based bank US$ 86.5bn US$ 55.72bn (+6.2% YoY) (+11.1% YoY) Total Assets To
Slide 4: Chilean financial system
Chilean financial system
Slide 5: Bci is part of a robust financial system
Bci is part of a robust financial system CHILE. Quarterly GDP growth and forecast (%, YoY) Banking system capitalization ratio (Basel III) 3.7% 3.7% 4.1% 3.2% 3.1% 0.7% 0.2% 0.6% 1.2% 0.7% 11.2% 11.4% 11.9% 11.9% 10.5% Jun'22 Dec'22 Jun'23 Dic'23 May'24 CET1 AT1 TierII Total loans in the banking sys
Slide 6: Bci Consolidated
Bci Consolidated
Slide 7: A successful strategy supported by its strong corporate governance
A successful strategy supported by its strong corporate governance Long-term support from its controlling shareholders… …and strong corporate governance Private pension Board of Directors is composed by experts in various fields, academics, economists, funds bankers and individuals connected with th
Slide 8: MACH | We continue our path to monetization
MACH | We continue our path to monetization thanks to customer engagement and good performance in key indicators Launch of the MACH Premium Plan Q2’24. This initiative offers incremental benefits to the current value proposition, offering Zapping TV subscription, CASH-IN with credit cards, additiona
Slide 9: Bci maintains a relevant position in the market
Bci maintains a relevant position in the market % Market share in Chilean banking system Chilean banking system benchmark In US$mm, as of June 2024 Loan breakdown1 Assets1 Other Other banks banks (12) (12) 14.9% 17.1% 15.2% 16.2% 13.6% 9.7% 13.4% 15.4% 18.6% 15.7% 14.6% 12.2% 9.8% 13.4% 42,957 40,88
Slide 10: Loan growth evolution
Loan growth evolution Total loans (US$mm) Commercial & Interbank loans (US$mm) CAGR CAGR 11.8% 12.1% 37,041 11.1% 55,719 13.2% 35,112 53,103 32,726 23,032 49,787 53,103 37,867 32,390 29,046 22,238 36,650 20,961 44,076 34,828 35,195 20,609 37,980 24,918 19,026 31,753 28,439 17,042 12,874 14,009 17,85
Slide 11: Successful organic growth in Chile…
Successful organic growth in Chile… Return on average Equity (ROAE) 1 Local loans market share (%) 2 as of June 2024 Chile 24.64% 16.26% 12.28% 13.33% 12.78% 19.0% 9.01% 17.1% 17.0% 16.2% 15.0% +102 bps of 14.9% market share Return on average assets (ROAA)1 as of June 2024 13.6% 2.29% 13.0% 0.90% 0.
Slide 12: …with diversified and funding cost
…with diversified and funding cost In terms of maturity, currency and geography Funding Sources Breakdown by type 1 Equity Long term funding composed primarily of UF local bonds in the Chilean market, Other 8.0% complemented by other international issuances, through our EMTN program in Liabilities 2
Slide 13: Risk Evolution
Risk Evolution Highlights Loan loss provisions / Average Gross Loans Bci's asset quality is supported by proactive risk management and 4.1% 3.85% monitoring. 3.64% 3.6% 3.65% We have a stock of over US$ 360 Million in additional provisions. 3.1% Our loan portfolio is well diversified by business lin
Slide 14: Evolution of NPL's
Evolution of NPL's NPL Ratio (NPLs/Total Loans)* NPL Ratio (Commercial Loans) 1.53% 1.33% 1.33% 1.18% 1.24% 1.23% 1.18% 1.17% 1.08% 1.11% 0.84% 0.85% 2020 2021 2022 2023 Jun'23 Jun'24 2020 2021 2022 2023 Jun'23 Jun'24 NPL Ratio (Consumer Loans) NPL Ratio (Mortgage Loans) 3.71% 1.65% 3.27% 3.03% 3.21
Slide 15: Financial Services: NPL's
Financial Services: NPL's 900 12.00% 800 9.39% 9.30% 10.00% 766 745 742 700 709 702 7.85% 680 655 649 630 600 8.00% 625 574 7.74% 500 523 523 6.40% 6.00% 400 5.15% 5.05% 3.92% 300 4.00% 2.56% 200 2.00% 100 0 0.00% Financial Services Loans MMUS$ NPL SSFF Ratio (NPLs / Loans) Figures are converted to
Slide 16: Operating Expenses
Operating Expenses Operating Expense (YTD) Expense Breakdown US$ million as of June 2024 13.6% 718 633 24% 551 55% 499 21% 129 159 1S2023 1S2024 CNB BCI Local Human Resources Technology Other Efficiency Ratio* 51.7% 47.9% 48.4% 47.2% 47.7% 45.0% 2020 2021 2022 2023 Jun'23 Jun'24 * Efficiency ratio a
Slide 17: Balance sheet
Balance sheet US$ million (*) 2020 2021* 2022* 2023* CAGR 2Q 2023* 2Q 2024* %D 2019-2023 Cash 4,869 4,628 4,507 3,833 -7.66% 3,960 4,683 18.25% Securities 9,706 21,580 21,123 19,145 25.41% 19,987 18,053 -9.68% Loans 37,143 49,073 49,787 53,103 12.65% 50,154 55,719 11.10% Other Financial Instruments
Slide 18: Financial results
Financial results CAGR US$ million (*) 2020 2021* 2022* 2023* 2Q 2023* 2Q 2024* %D 2020-2023 Net Interest Income 1,545 1,692 2,446 2,140 11.49% 545.7 567.6 4.02% Net Service Fee Income 355 367 389 361 0.52% 89.7 108.8 21.28% Other Operating Income 252 230 24 168 -12.75% 39.4 59.7 51.7% Operating Inc
Slide 19: City National Bank
City }y National V Bank
Slide 20: We have expanded our NIM, strengthened our liquidity position, increased our capital ratios
We have expanded our NIM, strengthened our liquidity position, increased our capital ratios and our CRE portfolio is well managed Client Deposits Liquidity NIM Capital Investments CRE Client deposits We maintained NIM increased Our CET 1 ratio 99% of our Our commercial have increased ~$10B of availa
Slide 21: While deposits in the banking industry just slightly increased YTD
While deposits in the banking industry just slightly increased YTD ($171B or 1%, including brokered deposits), our client deposits have grown significantly more ($593MM or 3.4%) Total Deposits ($MM) Banking Industry - Total Deposits ($B) Client Deposits QoQ change: ($603MM) -3.2% Client Deposits YTD
Slide 22: Loans increased QoQ by $232MM while maintaining strong asset quality
Loans increased QoQ by $232MM (1.3%) while maintaining our strong asset quality (NPLs <0.75%) Total Assets ($MM) Total Loans & Leases ($MM) +$51 +$77 Core Loans QoQ change: +$232MM +1.3% Non-owner Core Loans YTD change: +$149MM +0.9% occupied CRE (0%) (0%) represents $26,128 $26,102 $26,179 49% of t
Slide 23: CRE loans are well diversified across various property types with low LTVs
CRE loans are well diversified across various property types with low LTVs (50%), strong DSCR (1.8x) and excellent asset quality and ACL ratios CRE by Property Type % % Full & Commitment % Balance % WAvg WAvg % Accr Non- % In Partial Reserve Property Type ($M) Total ($M) Total % of RBC LTV % DSCR %
Slide 24: Florida's CRE market is the strongest in the US
Florida’s CRE market is the strongest in the US with higher rent growth & lower vacancies 8 of the 10 office markets with the strongest South Florida’s low retail vacancy rates is office rent growth are in Florida, highlighting projected to bring increased rent growth in Florida’s economic strength;
Slide 25: Net income increased 6% in Q2
Pre-tax, provision, and one-timers, net income increased 6% in Q2 primarily due to higher net interest income and lower non-interest expenses Net income pre-tax, provisions and one-timers – Q1 vs Q2-2024 ($MM) +$3 (+6.1%) $58 $3 ($1) $0 $54 $2 Q1-24 Actual Net Interest Income Non-interest expense No
Slide 26: Core earnings increased QoQ by $2.7MM (4.4%)
Core earnings increased QoQ by $2.7MM (4.4%) due to higher net interest income and lower non-interest expenses $ Var % Var YTD YTD $ Var % Var INCOME STATEMENT ($ millions) Q4 2023 Q1 2024 Q2 2024 QoQ QoQ 2023 2024 YoY YoY (+) Net Interest Income $113.5 $117.7 $119.3 $1.6 1.4% $272.4 $237.0 -$35.4 -
Slide 27: Net interest income continued to increase in Q2, with NIM expanding 6bps QoQ
Net interest income continued to increase in Q2, with the NIM expanding 6bps QoQ and 12bps compared to Q4-2023 Net interest income ($MM) Net Interest Margin (%) NIM expanded 6bps in Q2-2024, mainly due to lower cost of funds (3bps) and higher yield on loans (3bps) $4.1 +$1.6 (+4%) (+1%) $117.7 $119.
Slide 28: Management's response to the current environment
Management’s response to the current environment We have responded to the current industry dynamics by executing the following strategies: A. Executed $3.75B of pay fixed interest rate swaps during 2023 B. Increased required spreads on new loan originations to the current minimum of 325bps in 2023:
Slide 29: We continue to invest in our human capital to drive growth
We continue to invest in our human capital to drive growth ▪ The Tampa market represents a core growth market for the Bank as it executes on its geo- Tampa Market Expansion expansion strategy ▪ Hired a team of 6 people including: Market President, Commercial Director, Relationship Managers and Risk
Slide 30: Forward-looking statements
This presentation contains forward-looking statements in various places throughout therein, related to, without limitation, our future business development. Forward-looking information is often, but not always, identified by the use of words such as “anticipate”, “believe”, “expect”, “plan”, “intend
Banco de Crédito e Inversiones (Bci) — Q2 2024 Earnings Presentation on 6ix