Bancolombia (CIB) Q4 2024 earnings summary

Executive summary

• Net income for Q4 2024 was COP 1.7 trillion, up 11% year-over-year and 10.8% sequentially, with annualized ROE at 15.7% and full-year ROE at 15.8%.

• Full-year net income reached COP 6.3 trillion, a 2.5% increase, boosting shareholders' equity by 14.3%.

• Dividend proposal of COP 3.8 trillion (COP 3,900 per share), a 10.3% increase year-over-year, with a 60% payout ratio, to be paid in one installment in April 2025.

• Progress continues on the transition to Grupo Cibest as the new holding company, with regulatory approvals in Central America and ongoing process in Colombia, targeting completion by Q2 2025.

• Strong digital platform growth, with Nequi active users up 15% YoY and monetized users at 77%.

Financial highlights

• Net interest margin for Q4 was 6.4%, down 42 bps sequentially; full-year NIM was 6.8%, down 20 bps year-over-year.

• Net interest income from loans and leases decreased 2.5% in Q4 and 4.1% for the year due to lower rates and asset sensitivity.

• Fee income rose 4.4% in Q4 and 5.6% for the year, driven by higher transaction volumes and digital services.

• Operating expenses increased 13.4% quarter-over-quarter due to year-end effects, but only 5.3% year-over-year, reflecting disciplined cost control.

• Effective tax rate for 2024 was 28%, up from 24% in 2023.

Outlook and guidance

• 2025 guidance: consolidated loan growth of 5.6%, NIM around 6.2%, cost of risk between 1.9%-2.1%, efficiency ratio near 51%, ROE around 14%, and CET1 ratio of 11%-11.5%.

• Macroeconomic assumptions for 2025: GDP growth 2.6%, inflation 4.0%, central bank policy rate 6.5%-7.5%.