LatAm Banks

Financials

Galliano's Financials Research

Victor Galliano examines key balance sheet ratios of the LatAm Banks looking into liquidity, credit quality and capital adequacy, at a time of investor nervousness and concern - Victor likes Bradesco and Bancolombia as value plays with Banco de Chile, BanBajio and BanRegio as high quality names. His bearish picks are Banorte (even though it is a quality name in terms of capital and credit quality, it is more exposed on the importance of its securities portfolio) and BCI, despite its strong liquidity, with its small US (Florida) banking subsidiary.

- 31 March, 2023

Banco de Credito e Inversiones (BCI CI) & Itau CorpBanca (ITAUCORP CI) Senegal

Financials

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.

- 29 April, 2022