Banco De Chile Q2 Earnings Call Highlights

Strong second-quarter profitability: Banco de Chile reported CLP 391 billion in net income, with operating revenue up 20.9% year over year to CLP 922 billion. Results benefited from higher inflation-linked revenue, resilient customer income, 10.7% fee growth and disciplined expenses. Cautious credit outlook: The bank added CLP 50 billion in provisions due to macroeconomic and geopolitical risks, lifting quarterly cost of risk to 1.65%, although delinquencies remained broadly stable. It lowered its 2026 loan-growth forecast to about 6% and cut its Chile GDP-growth outlook to 1.3%. Capital and efficiency remain solid: Total loans grew 2.9% year over year on a pro forma basis, while the Basel III total capital ratio stood at 17.6% and the CET1 ratio at 13.9%. Management improved its full-year efficiency-ratio forecast to roughly 37% and continues to target a dividend payout near 60%.

Banco De Chile NYSE: BCH reported second-quarter net income of CLP 391 billion, supported by higher inflation-linked revenue, resilient customer income, fee growth and cost discipline, while the bank also increased additional loan-loss provisions amid a more uncertain macroeconomic backdrop. The bank said second-quarter operating revenue rose 20.9% year over year to CLP 922 billion. Return on average equity for the quarter was 27.9%, while return on average capital and reserves was 29.1%. For the first half, return on average equity stood at 22.9% and return on average assets reached 2.4%.

Head of Investor Relations Pablo Mejía Ricci said the bank’s second-quarter performance reflected a 5.8% net interest margin, higher fee income and continued expense control. Net financial income totaled CLP 736 billion, up 25.3% from a year earlier. The results benefited from higher inflation during the quarter. The UF variation reached 2.5% in the second quarter, compared with 1% in the same period of 2025, supporting income from the bank’s inflation-indexed balance-sheet position. Banco de Chile’s UF gap in the banking book was approximately CLP 9.1 trillion at the end of June. Customer income remained resilient at CLP 473 billion, with improved lending spreads contributing to higher income from consumer and commercial loans. Net fee income increased 10.7% year over year, led by a 20.4% increase in transactional-services fees. Credit-card transactions rose 5.7%, while debit-card transactions increased 11.9%. The bank reported 2.9 million active customers and 2.6 million bank accounts in the second quarter. Current accounts increased 7.1% from a year earlier, and the company’s net promoter score was 77.6%.

Total loans reached CLP 40.3 trillion in June, up 2.3% year over year. The reported figure included a one-time accounting effect from the migration of the bank’s outsourced credit-card processing platform. Under the new process, early card payments are immediately deducted from loan balances rather than remaining in other demand deposits until the billing due date. Banco de Chile said the migration reduced both credit-card loans and other demand deposits by about CLP 210 billion. Excluding that effect, total loans would have increased 2.9% year over year on a pro forma basis. Consumer loans increased 5.3% on that basis, while mortgage lending rose 3.4% and commercial loans increased 2%. The bank highlighted its deposit franchise and capitalization as competitive advantages. It held a 19.7% market share of local-currency demand deposits among private banks as of June. Demand deposits represented 26% of total funding, while the ratio of demand deposits to total loans was 36%, which manage...