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Covid-19 Pandemic Hurts Bancolombia Earnings Covid-19 Pandemic Hurts Bancolombia Earnings Source: Pixabay

Bancolombia 3Q 2020 Net Income Falls 68% Year-on-Year

Published in Companies Written by  November 15 2020 font size decrease font size increase font size 0
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Medellin-based multinational banking giant Bancolombia on November 12 reported a 68% decline year-on-year in third quarter (3Q) 2020 profits, to COP$73 billion (US$20 million).

For nine-months 2020, net income so far this year is down 79.5%, to COP$542 billion (US$149 million), according to the company.

Despite the pandemic-caused decline in earnings, “Bancolombia continues to strengthen its digital strategy with a robust growth in its mobile platforms,” now totaling 8.2 million digital accounts including 4.2 million users of ‘Bancolombia a la Mano’ and 4 million users of the electronic ‘Nequi’ platform, according to the company

As a result, “85% of total transactions are carried out through digital channels” rather than higher-cost, in-person banking, according to Bancolombia.

Gross loans in 3Q 2020 grew 8% year-on-year, to COP$199 trillion (US$54 billion), while loan provision charges soared 133% year-on-year, to COP$1.7 trillion (US$467 million). The coverage ratio for 90-day past due loans was 232%, according to Bancolombia

“This level of provisions was largely explained by the deterioration of the consumer portfolio, Covid-19 and the update of macroeconomic variables in our expected losses models,” according to Bancolombia.

As of September 30, 2020, Bancolombia’s assets totaled COP$265 trillion (US$72 billion), up 12% year-on-year, while liabilities grew 13%, to COP$239 trillion (US$65 billion).

“The increase in total assets during the year is largely explained by the growth in the loan book, interbank borrowings and financial assets investment,” according to Bancolombia.

Total reserves for loan losses increased by 9.7% during 3Q 2020, totaling COP$15 trillion (US$4.1 billion), equivalent to 7.6% of gross loans.

Read 205 times Last modified on Last modified on November 15 2020

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