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Net Income: COP377.7 billion, 91% higher than the previous quarter.
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Return on Equity (ROE): 9.3%.
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Return on Assets (ROA): 1%.
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Net Interest Margin (NIM): Decreased to 4.2%.
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Cost of Risk: Decreased to 1.9%.
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Fee Income Ratio: 25.4%, 2.2 percentage points lower than the second quarter.
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Efficiency (Cost to Income): Decreased to 48.6%.
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Gross Loans: COP104.4 trillion, 0.4% growth in the quarter.
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Deposits: COP98.6 trillion, a 2% quarterly decrease.
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30-day Past Due Loans (PDLs): Increased by 11 basis points to 6.4%.
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90-day Past Due Loans (PDLs): Increased by 15 basis points to 4.7%.
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Loan Yield: Decreased by 51 basis points to 12.2%.
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Cost of Funds: Decreased by 54 basis points to 7.7%.
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Total Operating Expenses: Decreased by 1.6% to COP926 billion.
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Total Income: Increased by 8.3% to COP1.9 trillion.
Release Date: November 22, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Net income attributable to shareholders increased by 91% from the previous quarter, resulting in a return on equity of 9.3%.
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Inflation in Colombia has decreased significantly from 13.3% in March 2023 to 5.4% in October 2024, improving household purchasing power.
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The cost of risk decreased to 1.9%, with significant improvements in personal loans, credit cards, and auto loans.
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Banco De Bogota SA (BOG:BOGOTA) has optimized its digital channels, achieving a 4% growth in transactions and maintaining a digital transactional share of 82%.
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The bank was recognized for its sustainability efforts, including being awarded by Euromoney as the best bank in Colombia regarding ESG and issuing a sustainable bond oversubscribed by 2.9 times.
Negative Points
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Net interest margin (NIM) contracted more than expected to 4.2%, due to lower lending yields and a higher cost of funds.
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Loan quality showed slight deterioration, with 30-day past due loans increasing by 11 basis points to 6.4%.
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Deposits decreased by 2% in the quarter, with savings accounts seeing a significant drop of 7.4%.
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The cost of funds has not decreased at the anticipated pace, impacting the bank's financial performance.
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Loan yields decreased due to lower usury rates and a shift in loan mix towards mortgages, which have lower yields.
Q & A Highlights
Q: I would like to know why the equity method increased that much. A: Hi, Julian, and thank you for your question. This is Javier. We experienced an improvement between the second and the third quarter. First, we had a very good quarter in Porvenir. In the second quarter, equity method coming from them was around COP79 billion, and it went up to COP114 billion. It was a good quarter for markets, and they seized that. The other factor is Corficolombiana, which had a negative equity method in the second quarter, but in the third quarter, the figure was almost break even. These are the main reasons behind the improvement in the equity method. Thank you.