Report by Creative Portfolios
From an Asset Quality stance, the Chilean Banking sector is the most resilient in LATAM with meagre or even mild Asset Quality erosion in contrast to all regional peers. Household Liquidity is elevated and credit is expanding at high single-digits. Profitability and Efficiency are on an upward trajectory while Capital is stable. Paul Hollingworth highlights BCI (PH Score™ 8.1, FV of 11%, PBV 0.95x, Earnings Yield 12.3%, Dividend 3.8%, Total Return Ratio 2.4x) and Itau CorpBanca (PH Score™ 9, FV of 10%, PBV 0.5x, Earnings Yield 21.8%, Total Return Ratio of 1.44x). For both banks, the value-quality PH Score™ gauge is elevated and indicative of strong relative returns going forward.