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Bancolombia 3Q 2019 Net Income Jumps 61.7% Year-on-Year

Published in Companies Written by  November 08 2019 font size decrease font size increase font size 0
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Medellin-based multinational banking giant Bancolombia announced November 6 that its third quarter (3Q) 2019 net income rose 61.7% year-on-year, to COP $879 billion (US$263 million).

“Gross loans grew 11.7% when compared to 3Q 2018 and 3.4% during the [latest] quarter,” according to Bancolombia.

“The quarterly growth shows a moderate trend in the credit demand in Colombia. Peso-denominated loans grew 10.5% when compared to 3Q 2018,” according to the company.

Net interest income was COP$2.78 trillion (US$833 million), up 8.3% year-on-year. “This increase is mainly explained by the growth in the loan book [although] net interest income decreased by 3.7% during the quarter due to an adjustment in accrued interest associated to [certain] clients,” according to the company.

Loan provision charges in 3Q 2019 were COP$723 billion (US$217 million) while the coverage ratio for 90-day past due loans was 191%.

“Provision charges decreased by 28.3% when compared to 3Q 2018 and by 11.4% compared to 2Q 2019. New past due loans totaled COP$91 billion [US$27 million],” according to Bancolombia.

At September 30, 2019, Bancolombia’s assets totaled COP$236.8 trillion (US$70.9 billion), up 2.6% compared to 2Q 2019 and up 14.6% compared to 3Q 2018.

During the latest quarter, the Colombian peso (COP) depreciated 8.5% versus the U.S. dollar, while over the past 12 months, the COP fell 17% versus the dollar, the company noted.

“The increase in total assets during the quarter is largely explained by the growth in the loan book,” according to Bancolombia.

“In 3Q 2019, gross loans increased by 3.4% when compared to 2Q 2019. Peso-denominated loans grew 10.5% and the dollar-denominated loans (expressed in dollars) decreased by 2.5% when compared to 3Q 2018,” according to the company.

“As of September 30, 2019, the operations in Banco Agricola in El Salvador, Banistmo in Panama and BAM in Guatemala, represented 27% of total gross loans.

“Gross loans denominated in currencies other than COP -- originated by the operations in Central America, the offshore operation of Bancolombia Panama, Puerto Rico and the dollar-denominated loans in Colombia -- accounted for 34.8% and increased by 6.9% during 3Q 2019 [when expressed in COP], explained mainly by the depreciation of the COP against the dollar during the quarter,” according to Bancolombia.

During 3Q 2019, net fees and income from services totaled COP$781 billion (US$234 million), up 3.5% compared to 2Q 2019, and up 17.1% compared to 3Q 2018.

“The positive annual performance in fees is due to higher volumes of transactions and the good performance of credit and debit cards, trust services and bancassurance,” according to Bancolombia.

“Fees from credit and debit cards increased by 6.7% compared to 2Q 2019 and by 22.6% compared to 3Q 2018.

“Fees from asset management and trust services increased by 5.8% compared to 2Q 2019 and by 12% compared to 3Q 2018, due to an increase in the assets under management. Fees from our bancassurance business increased by 6.6% compared to 2Q 2019 and by 22.9% with respect to 3Q 2018,” according to the company.

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