Banco Internacional del Peru (INTERBC1) H2 2023 earnings summary

Executive summary

• 1Q24 net income was S/125.0m, down 19.5% QoQ and 60.2% YoY; lower net service income and elevated credit provisions weighed on results.

• Annualized ROE was 6.6%, versus 8.2% in 4Q23 and 18.0% in 1Q23.

Financial highlights

• Interest income was S/1,482.5m, up 5.5% YoY; interest expense rose 14.0% to S/574.4m, leaving gross financial margin up 0.8% at S/908.0m.

• Credit provisions were S/531.3m, up 75.0% YoY; net financial margin fell 36.9% to S/376.7m.

• Net service income fell 19.9% YoY to S/135.5m; financial operations results rose 18.3% to S/109.9m.

• Administrative expenses declined 2.3% YoY to S/399.5m; operating margin fell 50.6% to S/222.6m and net income fell 60.2%.

• Excluding the prior-year S/31.2m property-sale gain, other income and expenses were affected by extraordinary items in the comparison period.

Segment performance

• Performing loans were S/43,936.1m, down 1.2% QoQ and up 0.0% YoY; total gross loans were S/46,107.9m, down 1.5% QoQ and up 1.0% YoY.

• Personal performing loans declined 1.1% QoQ and grew 0.8% YoY; commercial loans fell 2.3% QoQ and 0.9% YoY.

• Within personal loans, consumer lending fell 2.8% QoQ and 2.3% YoY, while mortgages rose 1.5% QoQ and 5.9% YoY.

• Excluding Reactiva Perú, performing loans would have fallen 1.4% QoQ but grown 2.3% YoY; commercial lending would have grown 4.4% YoY.