Bancolombia 3Q 2023 Net Income Dips 8.7% Year-on-Year
Medellin-based multinational banking giant Bancolombia announced November 8 that its third quarter (3Q) net income dipped 8.7% year-on-year, to COP$1.5 trillion (US$371 million).
“Annualized return on equity (ROE) at the consolidated level was 16.1% for the latest quarter and 16.7% for the last 12 months,” according to the company.
Gross loans dipped 1.2% versus second quarter (2Q) 2023, at COP$258 trillion (US$63.8 billion). “The appreciation of the Colombian peso against the U.S. dollar was 3.0%. When excluding the currency exchange effect, the credit portfolio would have decreased 0.2%,” according to Bancolombia.
Net interest income totaled COP$4.85 trillion (US$1.2 billion) in 3Q 2023, 1.7% lower than 2Q 2023. “The annualized net interest margin in the quarter increased from 6.7% in 2Q 2023 to 6.8% in 3Q 2023. A better result on the investment portfolio in Colombia largely contributed to such growth,” according to the company.
As for liabilities, “30-day past due loans stood at 4.88% and 90-day past due loans at 3.17%. Total provision charges, net for 3Q 2023, were COP$1.61 trillion (US$398 million), which represented a decrease of 22.7% when compared to 2Q 2023, driven mainly by expenses from previous quarters and a lower credit deterioration on consumers in Colombia,” according to Bancolombia.
Shareholders’ equity rose 2.7% compared to the previous quarter, “largely explained by net income generation during the quarter. Basic solvency stood at 10.87% and the total consolidated solvency ratio was 12.83% for 3Q 2023, complying with the minimum regulatory requirements,” according to the company.
Digital users continue to grow, with 8.2 million active digital customers in the retail app, “as well as 24 million accounts in its financial inclusion platforms: 6.4 million users in ‘Bancolombia a la Mano’ and 17.6 million in ‘Nequi,’ according to the company.
Gross loans in the latest quarter declined 1.2% compared to 2Q 2023 and declined 0.9% compared to 3Q 2022.
“During the last 12 months peso-denominated loans grew 0.5% and dollar-denominated loans (expressed in U.S. dollars) decreased 3.2%,” the company added.
“At the end of 3Q 2023, Banco Agricola operations in El Salvador, Banistmo in Panama and BAM in Guatemala represented 26% of total gross loans.
“Gross loans denominated in currencies other than COP — generated by operations in Central America, the international operation of Bancolombia Panamá, Puerto Rico and the U.S. dollar-denominated loans in Colombia — accounted for 32.3% of the portfolio, and decreased 1.7% in the quarter when expressed in U.S. dollars,” the company added.
Allowances for loan losses decreased 3.6% during the latest quarter. “The loan portfolio shows a continuous reduction in 2023 because of lower originations and higher prepayments,” according to the company.
“Progressively, retail presents a higher deceleration on a consolidated basis. This effect is deeper in Bancolombia S.A., with a quarterly reduction of 2.0%, in which personal loans stand out in declining balances. Commercial loans reflect a sluggish demand and were flat during the period,” the company added.
As of September 30, 2023, Bancolombia boasted of having 34,508 employees, 863 bank branches, 6,164 ATMs, 30,109 banking agents and more than 30 million customers.
