BLX Banco Latinoamericano de Comercio Exterior SA

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: March 5, 2019

BLADEX ANNOUNCES PROFIT FOR THE FOURTH QUARTER 2018 OF $20.7 MILLION, OR $0.52 PER SHARE;

FULL-YEAR 2018 PROFIT OF $11.1 MILLION, OR $0.28 PER SHARE

PANAMA CITY, REPUBLIC OF PANAMA, February 28, 2019

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 fourth quarter (“4Q18”) and Full-Year (“FY18”) ended December 31, 2018.

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”).

4Q18 & FY18 Highlights

CEO’s Comments

Mr. N. Gabriel Tolchinsky, Bladex’s Chief Executive Officer, said, “ In our third quarter 2018 conference call we mentioned that the credit quality of our portfolio, cost structure and allowances for expected credit losses, set the base to improve our earnings generation capacity. Our fourth quarter 2018 earnings are the first step in that direction.

Although still sub-par, growth rates of 2% – or slightly higher – are now possible for Latin America in 2019, we saw some recent positive news. Jair Bolsonaro’s election hit the ground running with several market friendly announcements regarding opening the Brazilian economy and introducing fiscal adjustments reforms. The USMCA was a bright spot in an otherwise grim picture from Mexico. Argentina completed its IMF agreement, without the social unrest feared by some. Even Costa Rica, which stretched the patience of the rating agencies, managed to approve in their famous Sala IV a fiscal reform package.

That said, problem spots such as Mexico, which seems to be deviating from the macroeconomic policies established over the last 20 years, and Argentina, which is in the midst of a recession generated by restrictive IMF policies, will continue to increase volatility and dampen growth expectations.

At the same time, macroeconomic global risks are intensifying. Now we need to add the prospects of slowing economies in Europe and China (and possibly the U.S.) to a tense protectionist trade environment.

What does this all mean for Bladex? A macroeconomic context that offers no room for complacency as risks of major economies slowing and trade tensions continuing are partially counterbalanced by a somewhat better macroeconomic picture in a few key countries in Latin America.

Although our headline margins were impacted by low yielding liquidity due to higher than expected central bank deposits, Bladex continues to improve its origination. We have a better mix of medium-term to short-term loans, thereby lengthening the average life of our portfolio and increasing our origination margins.

Our NPLs declined due to asset sales, restructurings and partial write-offs. Our Tier 1 capital ratio remains strong. Our book value remains solid over $25 a share. On this basis, Bladex’s Board of Directors approved to maintain our quarterly dividend.

Against this backdrop, both the management of Bladex, and its Board of Directors are cautiously optimistic for 2019 and look for an improvement in profitability throughout the year. ”

RESULTS BY BUSINESS SEGMENT

The Bank’s activities are managed and executed in two business segments, Commercial and Treasury. The business segment results are determined based on the Bank’s managerial accounting process as defined by IFRS 8 – Operating Segments, which assigns consolidated statement of financial positions, revenue and expense items to each business segment on a systemic basis.

COMMERCIAL BUSINESS SEGMENT

The Commercial Business Segment encompasses the Bank’s core business of financial intermediation and fee generation activities developed to cater to corporations, financial institutions and investors in Latin America. The extensive array of products and services include the origination of bilateral short- and medium-term loans, structured and syndicated credits, loan commitments, letter of credit contingencies 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. Profits from the Commercial Business Segment include (i) net interest income from loans; (ii) fess and commissions from the issuance, confirmation and negotiation of letters of credit, guarantees and loan commitments, and through loan structuring and syndication activities; (iii) gain on the sale of loans generated through loan intermediation activities, such as sales in the secondary market and distribution in the primary market; (iv) recovery (impairment loss) on financial instruments, such as loans at amortized cost and loan commitments and financial guarantee contracts, as well as impairment loss in other non-financial assets; and (v) direct and allocated operating expenses.

As of December 31, 2018, Commercial Portfolio balances remained stable QoQ at $6.3 billion, a 5% increase compared to $6.0 billion as of December 31, 2017. Average Commercial Portfolio balances were up to $6.2 billion in 4Q18, resulting in a 3% QoQ and 6% YoY increases, and to $6.0 billion in FY18, a 3% increase from a year ago.

The exposure of the portfolio remains well diversified across regions and industry sectors, with 52% of total Commercial Portfolio on the Bank’s traditional client base of Financial Institutions (49% in 2017) and a steady 19% of total Commercial Portfolio placed in Brazil, unchanged from a quarter ago and still representing the country with the largest exposure. As of December 31, 2018, trade finance transactions represented 59% of the short-term Commercial Portfolio, nearly unchanged from 60% a quarter ago and down from 74% a year ago. 74% of the Commercial Portfolio was scheduled to mature within a year, nearly stable compared to 75% a quarter ago and down from 81% a year ago, reflecting higher mid-term lending origination throughout the year.

The following graphs illustrate the geographic distribution of the Bank’s Commercial Portfolio, highlighting the portfolio´s risk diversification by country and across industry segments:

Refer to Exhibit IX for additional information relating to the Bank’s Commercial Portfolio distribution by country, and Exhibit XI for the Bank’s distribution of loan disbursements by country.

"n.m." means not meaningful.

The Commercial Business Segment reported a profit of $23.8 million for the 4Q18, a QoQ positive swing resulting mainly from the impairment losses charged in the previous quarter and an 11% improvement in total revenues from higher NII and fee income generation.

Full-Year 2018 Commercial Business Segment’s result of $26.8 million was mainly impacted by impairment loss on financial instruments from higher credit provisions associated to NPLs, mainly in Brazil’s sugar sector, and the impairment loss on non-financial assets related to credit restructurings. In addition, the yearly result was also impacted by lower NII due to narrower net lending spreads from a portfolio with exposure to high quality borrowers such as systemic financial institutions, sovereign and quasi-sovereign entities, and USD generating top-tier corporate clients.

TREASURY BUSINESS SEGMENT

The Treasury Business Segment focuses on managing the Bank’s investment portfolio and the overall structure of its assets and liabilities to achieve more efficient funding and liquidity positions for the Bank, mitigating the traditional financial risks associated with its balance sheet, such as interest rate, liquidity, price and currency risks. Interest-earning assets managed by the Treasury Business Segment include liquidity positions (cash and cash equivalents), and security instruments related to the investment management activities, consisting of securities at fair value through other comprehensive income (“OCI”) and investment securities at amortized cost (“Treasury Portfolio”). The Treasury Business Segment also manages the Bank’s interest-bearing liabilities, which constitute its funding sources, mainly deposits, short- and long-term borrowings and debt.

Profit from the Treasury Business Segment includes net interest income derived from the above mentioned treasury assets and liabilities and related net other income (net results from derivative financial instruments and foreign currency exchange, gain (loss) per financial instruments at fair value through profit or loss, gain (loss) per financial instruments at fair value through OCI, and other income), recovery (impairment loss) on financial instruments, and direct and allocated operating expenses.

Liquidity balances amounted to $1.7 billion at year-end 2018, of which 97% were held in deposits with the Federal Reserve Bank of New York, compared to $0.8 billion, or same portion of liquid assets, at the end of 3Q18, and compared to $0.6 billion, or 98% of liquid assets, a year ago. Year-end liquidity balances were above historical levels, as the Bank resorted to alternative funding sources in anticipation of a potential temporary decline of its deposit base. Although the average deposit balances declined 12% QoQ, this trend was reverted by the end of the year, resulting in a 7% increase QoQ. Consequently, liquidity balances represented 22.4% of total assets and 57.4% of total deposits at year-end 2018, compared to 11.7% and 27.5% a quarter ago, and 9.9% and 21.1% a year ago, respectively.

The Treasury Portfolio balances totaled $107 million as of December 31, 2018, compared to $93 million as of September 30, 2018, and compared to $86 million as of December 31, 2017. As of these dates, the Investment Securities Portfolio accounted for 1% of total assets, respectively, mostly consisting of readily-quoted Latin American securities, and of which 76% represented sovereign or state-owned risk at the end of the 4Q18, compared to 77% and 79% a quarter and year ago, respectively (refer to Exhibit X for a per-country risk distribution of the Treasury Portfolio).

On the funding side, deposit balances increased 7% QoQ and 1% YoY to reach $3.0 billion, which represents 46% of total funding sources, at the end of 4Q18, compared to $2.8 billion, or 51% of total funding sources at the end of 3Q18 and $2.9 billion, or 57% of total funding sources at the end of the 4Q17. The majority of the deposits are placed by central banks or designees (i.e.: Class A shareholders of the Bank), with 71%, 74%, and 67%, of total deposits, at the end of these periods, respectively. As of December 31, 2018, borrowings and debt increased 32% QoQ and 59% YoY, as a result of a conservative liquidity management approach and the funding requirements of the Bank’s commercial origination.

Weighted average funding costs were 3.13% in 4Q18 (up 24bps QoQ and 103bps YoY) and 2.76% in FY18 (up 81bps YoY), mainly reflecting higher LIBOR-based market rates with funding spreads annually down but slightly up on a quarterly basis.

"n.m." means not meaningful.

Fourth Quarter and Full-Year 2018 Treasury Business Segment’s losses were $3.0 million (-5% QoQ; 29% YoY) and $11.6 million (+1% YoY), respectively. The annual improvement was primarily associated to an increase in total revenues mainly from higher NII, as the Bank optimized its GAP position. Other income (expense), mostly related to hedging derivatives valuations and gain on sale of financial instruments, remained relatively stable on a full-year basis.

NII for the 4Q18 increased 2% QoQ to $28.0 million (-1% YoY), while NIM decreased by 13bps to 1.61%. Lower margins reflect increased low-yield liquidity position, as the Bank resorted to alternative funding sources in anticipation of a potential temporary decline of its deposit base, which actually increased during the last weeks of the year.

The reduced level of NII and NIM during 2018 relates to narrower net lending spreads from a portfolio with exposure to high quality borrowers such as systemic financial institutions, sovereign and quasi-sovereign entities, and USD generating top-tier corporate clients. These effects were partially offset by the net positive effect in the repricing of the Bank’s assets and liabilities in an increasing interest rate environment. The Bank maintained a narrow interest rate gap structure due to the short-term nature of its loan portfolio, and was able to pass along LIBOR-based market rates increases in its funding to its asset base.

FEES AND COMMISSIONS

Fees and Commissions, net, includes the fee income associated with letters of credit and other contingent credits, such as guarantees and credit commitments, as well as fee income derived from loan structuring and syndication activities, together with loan intermediation and distribution activities in the primary market.

Full-Year 2018 Fees and Commissions decreased 2% YoY as a result of the net effect of: i) a 12% increase in fees from the letters of credit and other contingent credits activities, which represented an upward trend in fee generation over the last two years congruent with the Bank’s focus on deepening its participation in the trade value chain; offset by ii) a 26% year-on-year decrease in loan structuring and syndication fees with seven transactions structured in 2018.

On a quarterly basis, Fourth Quarter 2018 Fees and Commissions increased 46% QoQ and decreased 5% YoY, reflecting the fee income improvement from letters of credit activities and the uneven nature of the loan syndication business.

The total allowance for credit losses on the Commercial Portfolio totaled $104.1 million at December 31, 2018, or 1.65% of the portfolio, compared to $142.5 million, or 2.26%, respectively, as of September 30, 2018, and compared to $88.1 million, or 1.47%, respectively, as of December 31, 2017. The $38.4 million QoQ decrease was primarily associated with loan restructurings through sales and partial write-offs against individually allocated allowances for expected credit losses. Consequently, NPL balances decreased to $64.7 million, or 1.12% of total Loan Portfolio balances at the end of 4Q18, versus NPLs of $119.0 million, or 2.08% of total Loan Portfolio balances, at the end of 3Q18, and $58.8 million, or 1.07% of total Loan Portfolio balances, at the end of 4Q17. At year-end 2018, the impaired sugar loan accounted for 96% of total NPLs and for most of the Stage 3 (under IFRS 9) individually allocated reserve for expected credit losses.

Total Operating Expenses in 4Q18 increased 14% QoQ mainly due to seasonal effects, and decreased 6% YoY mostly associated to personnel restructuring charges incurred in 4Q17. Efficiency Ratio of 36% in 4Q18, nearly unchanged from a quarter ago and down from 38% in 4Q17.

Full-Year 2018 Operating Expenses increased 4% YoY, mainly impacted by non-recurring charges in 2018, from personnel restructuring and the streamilining of processes and of technological infrastructure. Efficiency Ratio stood at 38% for the FY18, compared to 34% a year ago, on lower total revenues and operating expenses mainly impacted by those one-time expenses.

The Bank’s equity consists entirely of issued and fully paid ordinary common stock, with 39.5 million common shares outstanding as of December 31, 2018. At the same date, the Bank’s ratio of total assets to stockholders’ equity was 7.7 times, and the Tier 1 Basel III Capital Ratio remained solid at 18.1%, with increased level of risk-weighted assets reflecting annual Commercial Portfolio growth. Equity levels decreased 5% from a year ago on a strong dividend pay-out ratio.

RECENT EVENTS

Notes:

Footnotes:

SAFE HARBOR STATEMENT

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, Peru, and the United States of America, 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 Thursday, February 28, 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: 43528324.

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