PANAMA CITY, Oct. 18, 2019
/PRNewswire/ -- Banco Latinoamericano de Comercio Exterior,
S.A. (NYSE: BLX, "Bladex", or "the Bank"), a Panama-based multinational bank originally
established by the central banks of 23 Latin-American and
Caribbean countries to promote
foreign trade and economic integration in the region, today
announced its results for the third quarter ("3Q19") and nine
months ("9M19") ended September 30,
2019.
The consolidated financial information in this document has been
prepared in accordance with International Financial Reporting
Standards ("IFRS") as issued by the International Accounting
Standards Board ("IASB").
FINANCIAL SNAPSHOT
(US$ million, except
percentages and
per share amounts)
|
9M19
|
9M18
|
3Q19
|
2Q19
|
3Q18
|
Key Income
Statement Highlights
|
|
|
|
|
|
Net Interest Income
("NII")
|
$82.6
|
$81.8
|
$26.7
|
$27.9
|
$27.3
|
Fees and commissions,
net
|
$10.3
|
$11.8
|
$2.8
|
$5.1
|
$3.7
|
Total
revenues
|
$95.2
|
$93.5
|
$29.5
|
$33.6
|
$30.1
|
Impairment loss on
financial instruments
|
($2.4)
|
($58.8)
|
($0.6)
|
($0.8)
|
($55.1)
|
Gain (impairment
loss) on non-financial assets
|
$0.5
|
($7.7)
|
$0.5
|
$0.0
|
($4.8)
|
Operating
expenses
|
($29.4)
|
($36.5)
|
($9.0)
|
($10.6)
|
($10.9)
|
Profit (loss) for the
period
|
$64.0
|
($9.6)
|
$20.4
|
$22.3
|
($40.7)
|
Profitability
Ratios
|
|
|
|
|
|
Earnings per Share
("EPS") (1)
|
$1.62
|
($0.24)
|
$0.52
|
$0.56
|
($1.03)
|
Return on Average
Equity ("ROAE")(2)
|
8.5%
|
-1.2%
|
8.0%
|
9.0%
|
-15.5%
|
Return on Average
Assets ("ROAA")
|
1.36%
|
-0.20%
|
1.34%
|
1.43%
|
-2.58%
|
Net Interest Margin
("NIM")(3)
|
1.77%
|
1.74%
|
1.77%
|
1.81%
|
1.74%
|
Net Interest Spread
("NIS")(4)
|
1.19%
|
1.26%
|
1.19%
|
1.22%
|
1.20%
|
Efficiency
Ratio(5)
|
30.9%
|
39.1%
|
30.4%
|
31.4%
|
36.0%
|
Assets, Capital,
Liquidity & Credit Quality
|
|
|
|
|
|
Commercial
Portfolio(6)
|
$6,217
|
$6,305
|
$6,217
|
$6,209
|
$6,305
|
Investment
Portfolio
|
$85
|
$93
|
$85
|
$88
|
$93
|
Total
assets
|
$6,681
|
$6,561
|
$6,681
|
$6,576
|
$6,561
|
Total
equity
|
$1,009
|
$989
|
$1,009
|
$1,003
|
$989
|
Market
capitalization(7)
|
$790
|
$827
|
$790
|
$825
|
$827
|
Tier 1 Basel III
Capital Ratio (8)
|
21.1%
|
17.8%
|
21.1%
|
20.4%
|
17.8%
|
Total assets / Total
equity (times)
|
6.6
|
6.6
|
6.6
|
6.6
|
6.6
|
Liquid Assets / Total
Assets (9)
|
14.4%
|
11.7%
|
14.4%
|
12.8%
|
11.7%
|
Credit-impaired loans
to Loan Portfolio(10)
|
1.11%
|
2.08%
|
1.11%
|
1.16%
|
2.08%
|
Total allowance for
losses to Commercial Portfolio(11)
|
1.67%
|
2.26%
|
1.67%
|
1.70%
|
2.26%
|
Total allowance for
losses to credit-impaired loans (times)(11)
|
1.7
|
1.2
|
1.7
|
1.6
|
1.2
|
3Q19 & 9M19 Highlights
- Bladex's quarterly profit of $20.4
million in 3Q19 was 150% higher YoY, attributable to lower
impairment losses on financial instruments and other assets, along
with lower operating expenses. The 8% profit decrease QoQ was
mainly driven by lower structuring and syndication fees as well as
Net Interest Income ("NII").
- Profit for the 9M19 was $64.0
million, compared to a $9.6
million loss for 9M18, primarily resulting from lower
impairment losses, improved performance in top line revenues (+2%
YoY) and lower operating expenses (-20% YoY).
- NII totaled $26.7 million for the
3Q19 (-5% QoQ; -2% YoY), with Net Interest Margin ("NIM") of 1.77%
(-4bps QoQ; +3bps YoY). Quarterly decrease was mainly due to
the Bank's asset-liability interest rate gap position and lower
average lending volumes. NII and NIM for 9M19 reached
$82.6 million and 1.77%,
respectively, a 1% and 3bps increase YoY.
- Fees and commissions income totaled $2.8
million in 3Q19 and $10.3
million for the 9M19. Quarterly decreases were primarily
related to the uneven nature of the syndication business. The 13%
decrease YoY was the result of lower fee income from the letters of
credit business.
- Efficiency Ratio improved to 30% in 3Q19 (-1pt. QoQ; -6pts.
YoY) and 31% for 9M19 (-8pts. YoY), as operating expenses decreased
to $9.0 million in 3Q19 (-15% QoQ;
-17% YoY) and to $29.4 million in
9M19 (-20% YoY). The reduction YoY was mainly due to lower
salaries and other personnel-related expenses, together with other
cost savings.
- 3Q19 and 9M19 annualized Return on Average Equity ("ROAE") were
8.0% and 8.5%, respectively. The Bank's capitalization
remained solid with a Tier 1 Basel III Capital Ratio of 21.1%, on
higher asset quality allocation and a shift to a lower country risk
mix exposure in our Commercial Portfolio.
- Credit-impaired Loans, also referred to as Non-Performing Loans
or NPL, decreased to $61.8 million at
the end of 3Q19, representing 1.1% of total Loan Portfolio
balances. 3Q19 NPL levels compare to $64.7
million, or 1.2% of total Loan Portfolio at the end of 2Q19,
and to $119.0 million, or 2.1%, at
the end of 3Q18. Total allowance for credit losses increased to 1.7
times NPL balances for 3Q19.
- End-of-period Commercial Portfolio balances remained stable QoQ
at $6.2 billion at the end of 3Q19
(-1% YoY). Average balances were $6.0
billion for the 9M19 (stable YoY) and $5.9 million for the 3Q19 (-2% QoQ and YoY).
CEO's Comments
Mr. N. Gabriel Tolchinsky,
Bladex's Chief Executive Officer said, "The global economy in
2019 is on course for its weakest year of growth since the
financial crisis, weighed down by tensions that have significantly
slowed international trade. Given this macroeconomic context,
we are, once again, downgrading our economic and trade growth
expectations for Latin America,
for both 2019 and 2020.
Today, we are expecting 0.2% economic growth for the Region -
down from 0.6% at the end of the second quarter. Trade is
expected to grow just 1.0% - down from 2.6% growth we were
expecting at the end of the second quarter. But these tepid
growth prospects mask significant disparities in economic
performance between countries. Large countries like
Mexico and Argentina are experiencing uncertainty that
has some of its roots in lower foreign investment flows which are a
key driver of economic growth. On the other hand, countries
like Colombia and Brazil are experiencing a pick-up in consumer
demand that is supporting their economies despite low commodity
prices and weak international trade. In other words, slow or
no growth in the developed world, which have resulted from
protectionist measures on trade, and commodity prices, are having
an uneven impact on the Region. Some countries are better
prepared to withstand the prevailing environment.
Against this backdrop, we continue to analyze the risk/reward
function at the country level, to adjust our portfolio accordingly
and to maintain a vigilant credit underwriting posture.
- Our credit portfolio is robust, with a slight decrease in
credit impaired loans and a reduction in our watch list
category.
- Our credit reserve coverage and Tier I capital ratio remain
strong.
- Our book of business is solid, we are identifying new
prospects, increasing share of wallet with our existing clients and
structuring value-added transactions.
- Our pipeline of syndicated and structured transactions tied
to Latin American integration is also solid and should help us
continue to increase our medium-term loan portfolio.
- On the cost side, our recurrent expenses continue to
decline.
The management of Bladex - as well as its Board of Directors
- remains cautiously optimistic for our business for the remainder
of 2019."
RECENT EVENTS
- Quarterly dividend payment: The Bank's Board of
Directors (the "Board") approved a quarterly common dividend of
$0.385 per share corresponding to the
third quarter 2019. The cash dividend will be paid on
November 19, 2019, to shareholders
registered as of October 29,
2019.
Notes:
- Numbers and
percentages set forth in this earnings release have been rounded
and accordingly may not total exactly.
- QoQ and YoY
refer to quarter-on-quarter and year-on-year variations,
respectively.
Footnotes:
1) Earnings per Share ("EPS")
calculation is based on the average number of shares outstanding
during each period.
2) ROAE refers to return on average
stockholders' equity which is calculated on the basis of unaudited
daily average balances.
3) NIM refers to net interest margin
which constitutes to Net Interest Income ("NII") divided by the
average balance of interest-earning assets.
4) NIS refers to net interest spread
which constitutes the average yield earned on interest-earning
assets, less the average yield paid on interest-bearing
liabilities.
5) Efficiency Ratio refers to
consolidated operating expenses as a percentage of total
revenues.
6) The Bank's "Commercial Portfolio"
includes gross loans (or the "Loan Portfolio"), loan commitments
and financial guarantee contracts, such as issued and confirmed
letters of credit, stand-by letters of credit, guarantees covering
commercial risk and other assets consisting of customers'
liabilities under acceptances.
7) Market capitalization corresponds to
total outstanding common shares multiplied by market close price at
the end of each corresponding period.
8) Tier 1 Capital is calculated
according to Basel III capital adequacy guidelines and is
equivalent to stockholders' equity excluding certain effects such
as the OCI effect of the financial instruments at fair value
through OCI. Tier 1 Capital ratio is calculated as a
percentage of risk-weighted assets. Risk-weighted assets are
estimated based on Basel III capital adequacy guidelines.
9) Liquid assets refer to total cash and
cash equivalents, consisting of cash and due from banks, and
interest-bearing deposits in banks, excluding pledged deposits and
margin calls. Liquidity ratio refers to liquid assets as a
percentage of total assets.
10) Credit-impaired loans are also commonly referred
to as Non-Performing Loans or NPL. Loan Portfolio refers to
gross loans, excluding interest receivable, the allowance for loan
losses, and unearned interest and deferred fees.
11) Total allowance for losses refers to allowance
for loan losses plus allowance for loan commitments and financial
guarantee contract losses.
SAFE HARBOR STATEMENT
This press release contains forward-looking statements of
expected future developments within the meaning of the Private
Securities Litigation Reform Act of 1995. The forward-looking
statements in this press release include the growth of the credit
portfolio, including the trade portfolio, the increase in the
number of the Bank's corporate clients, the trend of lending
spreads, changes in activities engaged in by the Bank that are
derived from the Bank's client base, anticipated operating results
and return on equity in future periods, including income derived
from the Treasury Business Segment, and changes in the
financial and performance strength of the Bank. These
forward-looking statements reflect the expectations of the Bank's
management and are based on currently available data; however,
actual performance and results are subject to future events and
uncertainties, which could materially impact the Bank's
expectations. Among the factors that can cause actual
performance and results to differ materially are as follows: the
anticipated changes in the Bank's credit portfolio; the
continuation of the Bank's preferred creditor status; the impact of
increasing/decreasing interest rates and of the macroeconomic
environment in the Region on the Bank's financial condition; the
execution of the Bank's strategies and initiatives, including its
revenue diversification strategy; the adequacy of the Bank's
allowance for expected credit losses; the need for additional
allowance for expected credit losses; the Bank's ability to achieve
future growth, to reduce its liquidity levels and increase its
leverage; the Bank's ability to maintain its investment-grade
credit ratings; the availability and mix of future sources of
funding for the Bank's lending operations; potential trading
losses; the possibility of fraud; and the adequacy of the Bank's
sources of liquidity to replace deposit withdrawals. Factors or
events that could cause our actual results to differ may emerge
from time to time, and it is not possible for us to predict all of
them. We undertake no obligation to publicly update any
forward-looking statement, whether as a result of new information,
future developments or otherwise, except as may be required by
law.
ABOUT BLADEX
Bladex, a multinational bank originally established by the
central banks of Latin-American and Caribbean countries, began operations in 1979
to promote foreign trade and economic integration in the Region.
The Bank, headquartered in Panama,
also has offices in Argentina,
Brazil, Colombia, Mexico, and the
United States of America, and a Representative License in
Peru, supporting the regional
expansion and servicing its customer base, which includes financial
institutions and corporations.
Bladex is listed on the NYSE in the
United States of America (NYSE: BLX), since 1992, and its
shareholders include: central banks and state-owned banks and
entities representing 23 Latin American countries; commercial banks
and financial institutions; and institutional and retail investors
through its public listing.
CONFERENCE CALL INFORMATION
There will be a conference call to discuss the Bank's quarterly
results on Friday, October 18, 2019
at 11:00 a.m. New York City time (Eastern Time). For
those interested in participating, please dial (800) 311-9401 in
the United States or, if outside
the United States, (334) 323-7224.
Participants should use conference ID# 8034, and dial in five
minutes before the call is set to begin. There will also be a
live audio webcast of the conference at
http://www.bladex.com. The webcast presentation will be
available for viewing and downloads on http://www.bladex.com.
The conference call will become available for review on
Conference Replay one hour after its conclusion, and will remain
available for 60 days. Please dial (877) 919-4059 or (334)
323-0140, and follow the instructions. The replay passcode is:
66717091.
For more information, please access http://www.bladex.com or
contact:
Mrs. Ana Graciela de Méndez
Chief Financial Officer
Tel: +507 210-8563
E-mail address: amendez@bladex.com
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SOURCE Banco Latinoamericano de Comercio Exterior, S.A.
(Bladex)