Medellin-based multinational banking giant Bancolombia announced August 9 that its second quarter (2Q) 2022 net income rose 2.76% year-on-year, to COP$1.73 trillion (US$405 million).

Gross loans totaled COP$243 trillion (US$56.8 billion), up 19.4% year-on-year. “When excluding the foreign-exchange effect, the increase during the last twelve months was 15.3%,” according to the company.

Commercial loans grew 18.8% while consumer loans grew 23.5%, according to the company.

“Net interest income before provisions increased 16.6% and totaled COP$4.3 trillion [US$1 billion],” according to Bancolombia.

“Net interest margin expanded from 6.0% in 1Q 2022 to 6.7% in 2Q 2022. This performance is mainly driven by the loan portfolio growth of 9.3% in the latest quarter and loan portfolio repricing as an effect of the contractionary monetary policy in Colombia.”

Among the loan portfolios,”30-day past due loans stood at 3.86% and 90-day past due loans at 2.72%. Total provision charges, net for 2Q 2022, was COP$613 billion [US$143 million], which indicates a lower release compared to 1Q 2022 and higher provisions in the consumer and commercial portfolio in line with the growth of the loan book,” the company added.

“Basic solvency stood at 10.28% and the total consolidated solvency ratio was 12.93% for 2Q 2022, decreasing mainly because of the loan dynamism and the depreciation effect, but widely exceeding the minimum regulatory requirements.”

As for its digital banking segment, “Bancolombia shows a positive trend in line with 2021 results. As of June 2022, the bank has 7 million active digital customers in the retail app, as well as 19.3 million accounts in its financial inclusion platforms: 6.3 million users in ‘Bancolombia a la Mano’ and 13 million in ‘Nequi,’” the company explained.

“During the second quarter 2022, the Colombian peso depreciated 10.5% against the US dollar and has depreciated 10.7% in the last 12 months. The average exchange rate was 0.1% higher in 2Q 2022 versus 1Q 2022, and 7.9% higher in the last 12 months.

“During the last 12 months peso-denominated loans grew 16.9% and the dollar-denominated loans (expressed in US dollars) grew 12.4%,” the company added.

Operations at its “Banco Agricola” subsidiary in El Salvador, “Banistmo” in Panama and “BAM” in Guatemala represented 27.5% of total gross loans for 2Q 2022.

“Likewise, the gross loans denominated in currencies other than COP -- generated by operations in Central America, the international operation of Bancolombia Panamá, Puerto Rico and the US dollar-denominated loans in Colombia -- accounted for 35.4% of the portfolio, up 16.2% (when expressed in COP) as well as 5.2% as expressed in US dollars,” the company added.

“During 2Q 2022, the loan portfolio at a consolidated level continues with good dynamism in all geographies. Growth in commercial and consumer markets are remarkable. Banco Agricola reported the highest quarterly growth (6.5% when measured in US dollars), mainly driven by the commercial portfolio, which grew 11.2% and reached 45.3% of the total loan portfolio.

“Consumer loans grew 3.6% in the quarter, but slightly declined to 40.4% in terms of loan book share compared to 1Q 2022. Banco Agricola is closely followed by the Colombian operation, which presents an increase of 6.4% in the loan portfolio for 2Q 2022, driven by commercial and consumer.

“Banco Agromercantil reports a stable performance across all loan portfolio segments for 2Q 2022, growing at 1.9% consolidated in US dollars. The consumer portfolio continues increasing its loan book share, reaching 16.8% for this quarter, in line with the good performance experienced in 2021.

“Banistmo grew 1.8% (measured in US dollars) in the loan book during the quarter, basically due to the positive dynamics of the commercial portfolio, which grew 3.6% for the quarter and continues to be the largest share in the credit portfolio,” the company added.