During the past months, economic activity has gained momentum in Colombia and several indicators confirm it. One of them is private consumption and is measured by the purchases of Bancolombia’s cardholders; this concept takes into account the percentage variations of 2021 against 2019 and 2020. In this quarter, the indicator presented an improvement vis-á-vis 2020, growing 44% in July, 38% in August, and 23% in September. Regarding pre-pandemic levels, the indicator also showed an advance, increasing by 5%, 4%, and 6% in the aforementioned months.
Another two concepts that reflect the advance in the economy are the number of users in Bancolombia’s digital platform and the payroll payments through Bancolombia accounts. As of the end of the third quarter, Nequi -its digital platform- reported 8.6 million users, 2.15 times higher than the fourth quarter of 2020. Payroll payments increased in comparison to 2019, reaching an advance of 12.3% in September.
These concepts, coupled with a positive variation in the Bank’s deposits, contributed to the solid results presented this quarter.
Even though during 3Q21 the investment interest rate derivates and repos portfolio were 8.4% lower than the figures presented in 2Q21, net interest income presented positive results, amounting to COP 2.9 billion. Net interest income increased 2.1% compared to 2Q21 and 4.9% against 3Q20.
The annualized net interest margin (NIM) stood at the same level of 2Q21, reaching a total of 5.0% during 3Q21. Investment annualized net interest margin totaled 0.6%, mainly due to the management operations of the bank’s liquidity and the fixed income portfolio. Likewise, the annualized net interest margin of the loan portfolio closed at 5.6%, representing a reduction of 10 bps vis-á-vis 2Q21.
Net profit for the third quarter of 2021 totaled 943 billion Colombian Pesos (COP), reflecting a decrease of 18.5% compared to 2Q21 and an improvement of 237.1% compared to 3Q20.
On one hand, gross loans amounted to COP 210 trillion, which represents an increase of 3.3% compared to 2Q21; on the other hand, deposits experienced a reduction of 0.05% against the previous quarter.
Provision charges for 3Q21 were COP 514 trillion, representing a decrease of 17.8% compared to the previous quarter and 69.4% compared to the third semester of 2020. In addition, the coverage ratio for 90-day past-due loans was 218.5%. This reduction reflects a better economic perspective in the models for 2021 and the improvements in the provisioning models for the portfolio under credit reliefs.
The company obtained an efficiency ratio of 51.4% for the last 12 months. Operating expenses in the first nine months of the year rose 9.0% compared to the same period last year. For this quarter, operating expenses increased 14.2% in comparison to the previous quarter and were 22.9% higher than those of 3Q20.
Under Basel lll (international regulatory framework), Tier 1 capital reached 11.7% as of September 30, 2021, an increase of 27 basis points compared to the end of June of 2021. The solvency ratio concluded at 15.31%; the firm states that this leverage ratio is adequate considering the balance sheet risks and asset growth expectation.
Bancolombia showed an improvement not only in its income statement but also in its balance sheet.
As of June 30, 2021, Bancolombia’s assets were COP 269.7 trillion, which represents an increase of 1.6% compared to the previous quarter. Bancolombia disclosed that the expansion in its assets is due to the growth in its loan book. On the other hand, total liabilities amounted to 237.8 trillion, representing 88% of total assets.
Shareholders’ equity amounted to COP 30 trillion, reflecting an increase of 8.1% compared to the prior-year quarter. The increase is mainly due to the profits generated during the last months.
Finally, it is worth noting the role of digital transactions and the increase in the customer base due to this kind of channel. Bancolombia reported that 85% of total transactions and 44% of total sales were done through digital channels. Furthermore, the firm stated that considering both platforms as a whole, they already count with more than 14 million users and have registered about 1.4 trillion pesos in deposits.
