Bancolombia 4Q 2022 Net Income Jumps 66% Year-on-Year
Medellin-based multinational banking giant Bancolombia announced February 24 that its fourth-quarter (4Q) 2022 net income rose 66% year-on-year, to COP$6.8 trillion (US$1.4 billion).
Gross loans increased 22.5% year-on-year, or 14.6% when excluding depreciation of the Colombian peso (COP) against the U.S. dollar during 2022.
“Thirty-day past-due loans stood at 3.24% and 90-day past due loans at 2.16%,” while total credit provision charges “represent a cost of risk of 1.6% as a percentage of gross loans, reflecting a gradual normalization of the credit cycle,” according to Bancolombia.
“Basic solvency stood at 10.37% and the total consolidated solvency ratio was 12.79% for 2022, surpassing considerably the minimum regulatory requirements,” the company added.
Digital banking continues to grow, with 7 million active customers using the company’s retail app and another 21.5 million accounts tapping financial inclusion platforms including 6.6 million users in “Bancolombia a la Mano” and 14.9 million in the “Nequi” platform.
“As of December 31, 2022, assets on a consolidated basis totaled COP$352.8 trillion (US$72.8 billion), which represents an increase of 21.7% compared to 4Q 2021. The increase in total assets during the last year is largely explained by growth in the loan book,” according to the company.
“During the last 12 months, peso-denominated loans grew 18.2% and the dollar-denominated loans (expressed in U.S. dollars) grew 8.1%,” the company added.
Operations at Banco Agricola in El Salvador, Banistmo in Panama and BAM in Guatemala represented 29.4% of total gross loans for 4Q 2022.
“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 37.3% of the portfolio, and decreased 1.5% (as expressed in U.S. dollars) during the quarter,” according to the company.
During 4Q 2022, the loan portfolio “exhibited a slowdown on a consolidated basis compared to the second and third quarter of 2022. The operation in Colombia displayed the largest expansion of the portfolio, reporting an increase of 3.7% in the quarter,” the company added.
“In volume, the commercial segment showed the highest growth, while the slower pace of the consumer portfolio is evident as a result of the increase in interest rates.”
Inside Colombia, “the loan portfolio of Bancolombia S.A. reported an increase of 3.7% in the quarter and 18.7% in 2022. The slowdown in the economy´s pace of growth starts to be reflected in originations. For 4Q 2022, there is a deceleration compared to the second and third quarters of the year. The segment with the greatest expansion during the quarter was home lending, growing 4.9%,” according to the company.
For Colombia operations, 4Q 2022 net income dipped 5.6% versus third quarter (3Q) 2022. “It is evident that the pace of growth shows a deceleration as a result of a greater increase in the cost of funding when compared to the interest income,” according to the company.
In Panama, “loans at Banistmo decreased 2.4% in 4Q 2022 compared to the previous quarter (calculated in U.S. dollars). This variation is explained largely by the commercial portfolio, in line with year-end seasonality when typically, some corporate clients close the year with a lower balance on debt,” according to the company.
Despite the loan slowdown, Banistmo in 4Q 2022 recorded its best quarterly profit for the year, thanks to higher interest rates and “good performance on investments income from debt securities operations and derivatives,” according to the company.
