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BANCO DE CHILE
REPORT ON FORM 6-K
Attached is an English translation of a Press Release issued by Banco de Chile (the Bank) on October 28, 2005, regarding its financial statements for the third quarter ended September 30, 2005.
2005 Third Quarter Results |
Santiago, Chile, October 28, 2005 Banco de Chile (NYSE: BCH), a Chilean full service financial institution, market leader in a wide variety of credit and non credit products and services across all segments of the Chilean financial market, today announced results for the third quarter ended September 30, 2005. |
FINANCIAL HIGHLIGHTS |
|||
Net income for 3Q05 reached Ch$ 48,304 million, a 19.4% increase over the same quarter of 2004. ROAE of 28.2% for the 3Q05 largely exceeded, once again, the systems average of 17.0%. The Banks unconsolidated loan portfolio, net of interbank loans, increased by 12.6% during the last twelve months, allowing a 4 basis point increase in market share. The Basle ratio grew from 11.3% in June 2005 to 12.0% at the end of September, 2005 as a result of the capital increase coming from the placement of a 2.5% stake of shares previously purchased by the Bank. |
Selected Financial Data |
3Q04 |
2Q05 |
3Q05 |
% Change | ||||
3Q05/3Q04 | ||||||||
Income Statement (Millions, Chilean pesos) | ||||||||
Net Financial Incom e | 91,479 | 98,839 | 96,414 | 5.4% | ||||
Incom e from Services | 34,738 | 34,190 | 35,262 | 1.5% | ||||
Gains on Sales of Financial Instrum ents | (2,329) | 4,735 | 1,236 | - | ||||
Operating Revenues | 123,888 | 137,764 | 132,912 | 7.3% | ||||
Provisions for Loan Loss es | (20,063) | (11,045) | (12,518) | (37.6)% | ||||
Operating Expenses | (61,718) | (69,699) | (69,435) | 12.5% | ||||
Net Incom e | 40,455 | 52,937 | 48,304 | 19.4% | ||||
Earnings per Share (Chilean pesos) | ||||||||
Net incom e per Share | 0.61 | 0.80 | 0.71 | 16.4% | ||||
Book value per Share | 9.98 | 9.45 | 10.73 | 7.5% | ||||
Balance Sheet (Millions, Chilean pesos) | ||||||||
Loan Portfolio | 6,845,420 | 7,595,843 | 7,639,391 | 11.6% | ||||
Total Assets | 9,886,904 | 10,681,947 | 10,307,599 | 4.3% | ||||
Shareholders ' Equity | 662,309 | 627,655 | 730,500 | 10.3% | ||||
Profitability | ||||||||
ROAA | 1.63% | 2.00% | 1.86% | |||||
ROAE | 24.9% | 35.3% | 28.2% | |||||
Net Financial Margin | 4.1% | 4.2% | 4.2% | |||||
Efficiency ratio | 49.8% | 50.6% | 52.2% | |||||
Asset Quality | ||||||||
Past Due Loans / Total Loans | 1.46% | 1.09% | 0.99% | |||||
Allowances / Total Loans | 2.45% | 1.86% | 1.80% | |||||
Allowances / Past Due Loans | 167.6% | 169.6% | 181.1% | |||||
Capital Adequacy | ||||||||
Total Capital / Risk Adjus ted As sets | 12.1% | 11.3% | 12.0% | |||||
2005 Third Quarter Results |
|
Third Quarter 2005 Highlights
The Bank |
2005 Third Quarter Results |
|
Financial System Highlights |
Page 3 of 15
2005 Third Quarter Results |
|
Banco de Chile 2005 Third-Quarter
Consolidated Results
NET INCOME |
Net income for the 3Q05 continues to be outstanding, representing the second highest quarterly net income after 2Q05.
The Banks 3Q05 net income resulted in an annualized return on average assets (ROAA) and annualized return on average shareholders equity (ROAE) of 1.86% and 28.2%, respectively, higher than the 3Q04 comparable figures of 1.63% and 24.9% .
Net income increased by 19.4% to Ch$ 48,304 million in 3Q05 from Ch$40,455 million in 3Q04, mainly reflecting:
These positive drivers were partially offset by higher level of operating expenses, lower loan spreads, negative repricing effects and losses in the US branches during 3Q05.
The contribution of the Banks subsidiaries to the consolidated results amounted to Ch$6,234 million and represents 12.9% of total net income. The slight increase in the subsidiaries overall net profits for the current quarter compared to 3Q04 was mainly driven by improved performance of the Banks Factoring, Insurance Brokerage and Socofin subsidiaries.
Bank, Subsidiaries and Foreign Branches' Net Income | ||||||||
(in millions of Chilean pesos) | 3Q04 |
2Q05 |
3Q05 |
% Change | ||||
3Q05/3Q04 | ||||||||
Bank | 32,432 | 47,398 | 44,834 | 38.2% | ||||
Foreign Branches | 1,844 | (838) | (2,764) | - | ||||
Stock Brokerage | 2,891 | 3,448 | 2,553 | (11.7)% | ||||
Gral Adm. of Funds | 2,492 | 2,141 | 2,491 | (0.0)% | ||||
Insurance Brokerage | 93 | 95 | 172 | 84.9% | ||||
Financial Advisory | 90 | 9 | 101 | 12.2% | ||||
Factoring | 437 | 300 | 565 | 29.3% | ||||
Securitization | (12) | 23 | 26 | - | ||||
Promarket | 8 | 16 | 22 | 175.0% | ||||
Socofin | 180 | 295 | 251 | 39.4% | ||||
Trade Services | - |
50 | 53 | - | ||||
Total Net Income | 40,455 | 52,937 | 48,304 | 19.4% | ||||
The positive contribution made by the Factoring subsidiary in 3Q05, as compared to 3Q04, was a result of the strong expansion of 30.5% in its loan volume and lower provisions for loan losses. Higher revenues posted by the Insurance Brokerage during 3Q05 were closely related to strong sales of insurance products supported by marketing campaigns specifically tailored to cross-sell this product.
Lower results coming from the Stock Brokerage were principally a consequence of a decrease in earnings related to fixed income securities and trading of US dollars and an increase in personnel expenses related to indemnities, effects that were partially offset by higher income from stocks trading and higher fees generated by the investment banking unit.
The General Administrator of Funds continues to generate robust net income, however, the 3Q05 figure remained stable as compared to 3Q04, as higher fee income accounted for in 3Q05 was totally offset by higher payments related to the service agreement between this subsidiary and the Bank, regarding the use of distribution channels. It is worth noting, that this agreement has no impact on the bottom line.
Net income registered in 3Q05 and, to a lesser extent, in 2Q05, was adversely impacted by losses accounted for by the foreign branches as a consequence of extraordinary expenses incurred by the New York branch. This responded to efforts undertaken to comply with the Consent Order agreed with the OCC, which mainly includes legal counsel and advisory expenses.
On the other hand, net income for the 3Q05 decreased by 8.8% compared to the previous quarters record level. This decline mainly responded to a decrease in gains on sales of financial instruments and, to a lesser extent, to a drop in the net
financial income as the inflation rates dropped.
Page 4 of 15
2005 Third Quarter Results |
|
NET FINANCIAL INCOME |
Net financial income increased by 5.4% to Ch$96,414 million in 3Q05 from the Ch$91,479 million in 3Q04, as a result of a 1.9% expansion in average interest earning assets and a slight increase of 14 basis points in net financial margin1.
Net Financial Income | ||||||||
(in millions of Chilean pesos) | 3Q04 |
2Q05 |
3Q05 |
% Change |
||||
3Q05/3Q04 |
||||||||
Interest revenue | 143,857 | 193,167 | 172,367 | 19.8% | ||||
Interest expense | (64,006) | (94,900) | (86,797) | 35.6% | ||||
Foreign Exchange | ||||||||
transactions, net | 11,628 | 572 | 10,844 | (6.7)% | ||||
Ne t Financial Income | 91,479 | 98,839 | 96,414 | 5.4% | ||||
Avg. Int. earning assets | 8,944,516 | 9,396,076 | 9,116,425 | 1.9% | ||||
Net Financial Margin1 | 4.09% | 4.21% | 4.23% | - | ||||
The increase in average interest earning assets was mainly attributed to the 9.8% annual increase in average total loans, principally commercial, residential mortgage loans, consumer and contingent loans, which partially offset the 30.6% decrease in average investments.
The increase in net financial margin from 4.09% in 3Q04 to 4.23% in 3Q05 was mainly explained by:
However, these positive effects were partially offset by lower loans spreads and the negative repricing effect resulting from the successive increases in the short-term interest rates during 3Q05, as the Banks liabilities reprice faster than its assets. During 3Q05, the short- term interest rate was raised by 75 basis points while in 3Q04 this rate was raised only by 25 basis points at the end of that period.
3Q05 net financial income decreased by 2.5% as compared to the previous quarter, mainly as a consequence of lower inflation rate (1.3% during 3Q05 versus 1.7% in 2Q05) and, to a lesser extent, to higher negative repricing effects as the short-term interest rates increased by 75 basis points during 3Q05, as compared to 50 basis points increase during 2Q05.
The Bank continued to achieve a high level of sustainable fee income during 3Q05, totaling Ch$35,262 million, representing increases of 1.5% and 3.1% as compared to the same quarter of 2004 and to the previous quarter, respectively. These increases were primarily due to the growth in commissions coming from our subsidiaries, which significantly improved their contribution to total fee income to a 43.4% in 3Q05, from 34.7% in 3Q04 and 38.7% in 2Q05.
The Stock Brokerage subsidiary continues to show a strong performance through increased volumes of stock transactions. In addition, during 3Q05 an important expansion on accrued fees was also achieved related to its participation in stock offerings and to corporate advisory income coming from its investment banking unit. The better performance of the General Administrator of Funds in terms of fee income has also been favored by the good economic climate in Chile and by its permanent effort to provide excellent and innovative products and services to its customers. Consequently, average funds under management grew by 10.8% and the client base did so by 15.9% during the last twelve months, while both indicators jumped by 5.2% during the quarter. As the insurance related business has become a key fee generating product, special insurance campaigns were launched during 3Q05 thus implying a significant growth in total sales as well as in fee income accounted for by both the Bank and its insurance subsidiary.
2005 Third Quarter Results |
|
The Financial Advisory subsidiarys higher fee income during 3Q05 was principally related to a syndicated credit arrangement and services provided for the sale of a manufacturing company. Higher factoring commissions were also related to an important business transaction with a corporate client of the infrastructure sector, corresponding to a financing project for the Freeway route.
The decline in net fee income observed in the Banks line during 3Q05, as compared to 3Q04, was mainly explained by lower income from assets received in lieu of payment and an increase in fees paid to the sales force and co-branding expenses principally related to credit card campaigns and to the Banks strategy in increasing its client base in the retail sector. The lower income coming from these items, accounted for in the fee income line, was partially offset by higher fee income from traditional products such as sight accounts, ATMs and credit lines due to the 22% annual expansion of the ATM network and the increase in the number of current accounts.
The 3.1% increase in fee income during 3Q05 compared to the previous quarter was principally attributable to the Stock Brokerage and the General Administration of Funds. This growth shows the importance of the complimentary operations of the Bank and its subsidiaries, as well as the wide ranging solutions that the Bank is able to deliver to its clients.
Net Incom e from Services, by Com pany | ||||||||
(in millions of Chilean pesos) |
3Q04 |
2Q05 |
3Q05 |
% Change |
||||
3Q05/3Q04 |
||||||||
Bank | 21,844 | 20,205 | 19,244 | (11.9)% | ||||
General Adm. of Funds | 5,354 | 5,889 | 6,451 | 20.5% | ||||
Financial Advisory | 200 | 91 | 289 | 44.5% | ||||
Insurance Brokerage | 806 | 1,650 | 1,738 | 115.6% | ||||
Stock Brokerage | 3,229 | 3,225 | 4,364 | 35.2% | ||||
Factoring | 179 | 108 | 187 | 4.5% | ||||
Socofin | 2,274 | 2,130 | 2,131 | (6.3)% | ||||
Securization | 24 | 75 | 90 | 275.0% | ||||
Promarket | - | - | - | - |
||||
Foreign Branches | 828 | 765 | 712 | (14.0)% | ||||
Trade Services | - | 52 | 56 | - | ||||
Total Net Incom e from | ||||||||
Services | 34,738 | 34,190 | 35,262 | 1.5% | ||||
NET GAINS ON SALES OF FINANCIAL INSTRUMENTS |
On the third quarter of 2005, gains on sales of financial instruments increased to Ch$1,236 million from a loss of Ch$2,329 million in 3Q04. This loss was mainly related to: (i) the sale of a loan associated to the retail sector which effect at bottom line level was totally offset by the related provision release; and (ii) losses associated to the sale of Central Bank securities as a result of a specific increase in long-term interest rates during September 2004. It is worth mentioning that during 2Q05 long-term interest rates decreased by approximately 50 basis points implying higher mark to market income and therefore explaining higher gains on sales during such quarter.
PROVISIONS |
Provisions amounted to Ch$12,518 million in 3Q05, a 38% decrease as compared to the Ch$20,063 million in 3Q04 and a 13.3% increase relative to the Ch$ 11,045 million in the previous quarter. The annual decline in provisions confirms the trend observed since 2004, mainly reflecting the improved asset quality of the wholesale loan portfolio (large and medium size companies) and, to a lesser extent, of the retail segment. Better asset quality is directly related to better economic conditions and expectations fostered by higher aggregate demand led by both investment and consumption. In particular, the higher amount of provisions recorded in 3Q04 were mainly related to the downgrading of certain clients of the construction sector. The slight increase in provisions during 3Q05 compared to the previous quarter was principally related to corporations belonging to the retail and manufacturing sectors. However, over 90% of total provisions were associated to retail banking (individuals and small companies).
Provisions to average loans declined to 0.66% in 3Q05 from 1.16% in 3Q04, as well as the ratio of charge-offs to average loans which reached 0.74% in 3Q05 from 1.02% in 3Q04.
2005 Third Quarter Results |
|
Allow ances and Provisions | ||||||||
(in millions of Chilean pesos) |
3Q04 |
2Q05 |
3Q05 |
% Change |
||||
3Q05/3Q04 |
||||||||
Allow ances | ||||||||
Allow ances at the beginning of each period | 167,228 | 153,699 | 140,929 | (15.7)% | ||||
Price-level restatement | (1,703) | (2,855) | (1,956) | 14.9% | ||||
Charge-off | (17,582) | (20,960) | (13,935) | (20.7)% | ||||
Provisions for loan losses established, net | 20,063 | 11,045 | 12,518 | (37.6)% | ||||
Allow ances at the end of each period | 168,006 | 140,929 | 137,556 | (18.1)% | ||||
Provisions | ||||||||
Provisions | (20,063) | (11,045) | (12,518) | (37.6)% | ||||
Ratios | ||||||||
Allow ances / Total loans | 2.45% | 1.86% | 1.80% | |||||
Provisions, net /Avg.Loans | 0.43% | 0.09% | 0.24% | |||||
Provisions / Avg. Loans | 1.16% | 0.58% | 0.66% | |||||
Charge-offs / Avg. Loans | 1.02% | 1.11% | 0.74% | |||||
Recoveries / Avg. Loans | 0.74% | 0.49% | 0.42% | |||||
OTHER INCOME AND EXPENSES |
Total Other Income and Expenses decreased to Ch$6,750 million in 3Q05 from Ch$8,192 million in 3Q04, mainly as a consequence of lower recoveries of loans previously charged-off. It is worth noting that the 3Q04 figure of non-operating income, net, mainly reflects a one-time provision regarding previous year credit cards related expenses and, lower non-operating income coming from the sale of assets received in lieu of payment.
OPERATING EXPENSES |
Total operating expenses reached Ch$69,435 million during 3Q05, an increase of 12.5% compared to 3Q04, principally explained by the 23.8% expansion in administrative expenses and, to a lesser extent, by the 6.2% increase in personnel salaries.
The Ch$5,532 million increase in administrative expenses during 3Q05, as compared to 3Q04, was largely attributable to extraordinary legal counsel and advisory service expenses incurred during 3Q05 by the New York branch and related to the actions taken in order to fully comply with the US regulator requirements. Higher administrative expenses accounted for in the foreign branches amounted to Ch$4,451 million in 3Q05, representing about 80% of the overall increase in this line. To a lesser extent, higher administrative expenses were also fueled by higher computer and technology expenses and to rental and maintenance of fixed assets.
The 6.2% increase in personnel salaries between 3Q05 and 3Q04, is mainly explained by the incorporation of new employees, wage increases, higher performance related compensations, and an increase in indemnities.
The quarterly contraction in operating expenses during 3Q05, compared to the previous period, was largely the result of lower indemnity expenses, as in 2Q05 some adjustments to the organizational structure of the Bank were made, mainly in its commercial areas, in line with its new business model supported by the Neos project. This decrease was partially offset by higher administrative expenses accounted for both in the Bank and in the New York branch.
Operating expenses for the quarter represented 52.2% of operating revenues, thus increasing from 49.8% and 50.6% attained in 3Q04 and 2Q05, respectively, but continued to be lower than the 52.9% reached by the Chilean banking system in the same period.
Operating Expenses | ||||||||
(in millions of Chilean pesos) |
3Q04 | 2Q05 | 3Q05 | % Change |
||||
3Q05/3Q04 |
||||||||
Pers onnel salaries and expens es | (34,177) | (40,194) | (36,296) | 6.2% | ||||
Adm inis trative and other expens es | (23,228) | (25,089) | (28,760) | 23.8% | ||||
Depreciation and am ortization | (4,313) | (4,416) | (4,379) | 1.5% | ||||
Total operating expenses | (61,718) | (69,699) | (69,435) | 12.5% | ||||
Efficiency Ratio* | 49.8% | 50.6% | 52.2% | - | ||||
* Operating expenses/Operating revenues |
2005 Third Quarter Results |
|
LOSS FROM PRICE- LEVEL RESTATEMENT |
Loss from price-level restatement amounted to Ch$4,779 million in 3Q05 as compared to Ch$3,773 million during 3Q04, mainly as a consequence of higher inflation rates used for adjustment purposes: 1.3% in 3Q05 up from 1.0% in 3Q04.
INCOME TAXES |
The Banks income taxes totaled Ch$4,626 million in 3Q05 as compared to Ch$6,071 million in 3Q04, representing effective income tax rates of 8.7% and 13.0%, respectively, lower than Chiles 17% statutory corporate tax rate as, by law, the Bank is allowed to deduct the dividend payments to SAOS from its taxable income base.
LOAN PORTFOLIO |
The low interest rate environment that continues to prevail in the Chilean economy has allowed for both the Bank and the Chilean financial system to achieve attractive loan growth rates equivalent to approximately two times the GDP growth rate. Accordingly, at the end of September 2005, the Bank reached its highest level in terms of volume, with a total loan portfolio, net of interbank loans, of Ch$7,599,725 million. The sustained loan growth has permitted the Bank to attain an annual loan expansion of 11.7%, also positively impacted by high economic growth and favorable macroeconomic conditions.
Commercial loans, residential mortgage loans, consumer, contingent and lease contracts have peaked during this period. Also, it is important to emphasize that during the year, the Bank achieved robust loan increases of 17.4% in large corporations and healthy growth increases in individuals and medium size companies of 12.4% and 11.5%, respectively.
During 3Q05 the Banks highest loan growth was mainly registered in the individual segment and medium sized companies with 3.6% and 4.5%, respectively. Large corporate loans were importantly impacted by the decline in the exchange rate which implied a contraction in foreign trade and contingent loans. During 3Q05, loan growth in the individual segment was mainly led by mortgage loans financed by the Banks general borrowings and consumer loans, principally installments credits, from both high income and lower income individuals. It is worth noting that the Bank held its focus on the retail segment, where there is considerable room to expand, particularly in small companies and lower-income individuals. Accordingly, during 3Q05 the Bank has opened 10 new CrediChile branches in order to improve the geographical coverage of this segment.
Loan Portfolio | ||||||||||
(in millions of Chilean pesos) | Sep-04 |
Jun-05 |
Sep-05 |
% Change | % Change |
|||||
12-months |
3Q05/2Q05 |
|||||||||
Commercial Loans | 2,761,746 | 3,125,140 | 3,196,016 | 15.7% | 2.3% | |||||
Mortgage Loans 1 | 965,258 | 722,721 | 688,379 | (28.7)% | (4.8)% | |||||
Consumer Loans | 697,175 | 764,688 | 794,010 | 13.9% | 3.8% | |||||
Foreign trade Loans | 661,529 | 710,279 | 624,033 | (5.7)% | (12.1)% | |||||
Contingent Loans | 522,562 | 640,460 | 612,553 | 17.2% | (4.4)% | |||||
Others Outstanding Loans 2 | 756,436 | 1,141,835 | 1,188,281 | 57.1% | 4.1% | |||||
Leasing Contracts | 338,811 | 400,004 | 420,497 | 24.1% | 5.1% | |||||
Past-due Loans | 100,255 | 83,075 | 75,956 | (24.2)% | (8.6)% | |||||
Total Loans, net | 6,803,772 | 7,588,202 | 7,599,725 | 11.7% | 0.2% | |||||
Interbank Loans | 41,648 | 7,641 | 39,666 | (4.8)% | 419.1% | |||||
Total Loans | 6,845,420 | 7,595,843 | 7,639,391 | 11.6% | 0.6% | |||||
1 Mortgage loans financed by mortgage bonds. | ||||||||||
2 Includes mortgage loans financed by the Banks general borrowings and factoring contracts. |
2005 Third Quarter Results | |
Past Due Loans | ||||||||||
(in millio ns o f Chilean pesos) | Sep-04 | Jun-05 | Sep-05 | % C hange 12 - months |
% C hange 3Q05 / 2Q05 |
|||||
Commercial loans | 84,375 | 66,794 | 58,963 | (30.1)% | (11.7)% | |||||
Consumer loans | 3,680 | 3,185 | 3,567 | (3.1)% | 12.0% | |||||
Residential mortgage loans | 12,200 | 13,096 | 13,426 | 10.0% | 2.5% | |||||
Total Past Due Loans | 100,255 | 83,075 | 75,956 | (24.2)% | (8.6)% | |||||
FUNDING |
Total liabilities increased by 3.8% during the last twelve months as a consequence of a 6.8% growth in interest bearing liabilities, which more than offset the 2.0% contraction in non-interest bearing liabilities.
The successive increases in short-term interest rates during 2005 have enhanced the demand for time deposits while, and at the same time, negatively impacted bankers draft volumes. In fact, time deposits registered an annual increase of 16.0%, while bankers drafts decreased by 20.4% during the same period.
It is worth mentioning that the Bank has been expanding the duration of its liabilities mainly due to more attractive long and medium-term interest rates. Accordingly, long-term liabilities such as syndicated credits (accounted for as foreign borrowings), subordinated bonds and other bonds have importantly increased during the last twelve months. The 72.5% annual expansion of other bonds was principally related to a 5 year term bond placement for UF5 million in 2Q05 and to a series of placements of 5- year bonds for a total amount of UF2.67 million, in the local market, during 3Q05. Regarding subordinated bond growth, during 1Q05 the Bank placed a new series of these bonds for a total amount of UF2 million with an annual real rate of 4.34%, maturing in 2023. The higher level of foreign borrowings was influenced by the syndicated credit agreement signed by the Bank in April 2005 for an amount of US$200 million, in order to finance its foreign trade loans booked in Chile, and to expand the New York Branch working capital.
2005 Third Quarter Results | |
Funding | ||||||||||
(in millions of Chilean pesos) | Sep-04 | Jun-05 | Se p-05 | % Change 12 - months |
% C hange 3Q05 / 2Q05 |
|||||
Non-interest Bearing Liabilities | ||||||||||
Current Accounts | 1,338,099 | 1,519,360 | 1,426,210 | 6.6% | (6.1)% | |||||
Bankers drafts and Other Deposits | 831,929 | 834,135 | 662,095 | (20.4)% | (20.6)% | |||||
Other Liabilities | 979,622 | 1,083,402 | 999,853 | 2.1% | (7.7)% | |||||
Total |
3,149,650 | 3,436,897 | 3,088,158 | (2.0)% | (10.1)% | |||||
Interest Bearing Liabilitie s | ||||||||||
Savings & Time Deposits | 3,657,154 | 4,093,543 | 4,209,867 | 15.1% | 2.8% | |||||
Central Bank Borrow ings | 2,706 | 1,608 | 1,539 | (43.1)% | (4.3)% | |||||
Repurchase Agreements | 465,102 | 302,021 | 241,727 | (48.0)% | (20.0)% | |||||
Mortgage Finance Bonds | 934,197 | 629,617 | 591,288 | (36.7)% | (6.1)% | |||||
Subordinated Bonds | 275,193 | 307,286 | 304,637 | 10.7% | (0.9)% | |||||
Other Bonds | 184,406 | 273,952 | 318,180 | 72.5% | 16.1% | |||||
Borrowings from Domestic Financ. Inst. | 49,529 | 256,171 | 148,781 | 200.4% | (41.9)% | |||||
Foreign Borrowings | 459,016 | 706,623 | 622,939 | 35.7% | (11.8)% | |||||
Other Obligations | 47,641 | 46,573 | 49,982 | 4.9% | 7.3% | |||||
Total |
6,074,944 | 6,617,394 | 6,488,940 | 6.8% | (1.9)% | |||||
Total Liabilities | 9,224,594 | 10,054,291 | 9,577,098 | 3.8% | (4.7)% | |||||
INVESTMENT PORTFOLIO |
At September 30, 2005, the investment portfolio was principally comprised of:
2 | Technical reserve applies to demand deposits, checking accounts, or obligations payable on sight, other deposits unconditionally payable immediately or within a term of less than 30 days and time deposits payable within 10 days prior to maturity, to the extent their aggregate amount exceeds 2.5 times the amount of a banks capital and reserves. |
SHAREHOLDERS EQUITY |
At the end of September 2005, on a consolidated basis, Total Capital to Risk-Adjusted Assets (BIS ratio) was 12.0%, and Basic Capital to Total Assets was 5.7%, both well above the minimum requirements of 10% and 3%, respectively, applicable to Banco de Chile.
Shareholders' Equity | ||||||||||
(in million of Chilean pesos) | Sep-04 | Jun-05 | Sep-05 | % Change 12-months |
||||||
Capital and Reserves | 532,950 | 531,258 | 589,641 | 10.6% | ||||||
Accumulated adjustment for translation dif ferences 3 | 3,925 | 2,063 | (569) | (114.5)% | ||||||
Unrealized gain (loss) on permanent financial invest. 4 | 126 | 27 | 27 | (78.6)% | ||||||
Net Income | 125,308 | 94,307 | 141,401 | 12.8% | ||||||
Total Share holde rs' Equity | 662,309 | 627,655 | 730,500 | 10.3% | ||||||
________________________________________ | ||||||||||
3 | Represents the effect of the variation in the exchange rate on investments abroad that exceed the restatement of these investments according to the change in the consumer price index. | |||||||||
4 | Financial investments traded on a secondary market are shown adjusted to market value, following specific instructions from the Superintendency of Banks and Financial Institutions. These instructions state that such adjustments should be recognized against income, except in the case of the permanent portfolio, when an equity account, Unrealized gains (losses) on permanent financial investments, may be directly charged or credited. |
2005 Third Quarter Results | |
BANCO DE CHILE |
CONSOLIDATED STATEMENTS OF INCOME (Under Chilean GAAP) |
(Expressed in millions of constant Chilean pesos (MCh$) as of September 30, 2005 and m illions of US dollars (MUS$)) |
Quarters | % Change | Year ended | % Change | |||||||||||||||||||
3Q04 | 2Q05 | 3Q05 | 3Q05 | 3Q05-3Q04 | 3Q05-2Q05 | Sep.04 | Dec.04 | Sep.05 | Sep.05 | Sep.05-Sep. 04 | ||||||||||||
MCh$ | MCh$ | MCh$ | MUS$ | MCh$ | MCh$ | MCh$ | MUS$ | |||||||||||||||
Interest revenue and expense | ||||||||||||||||||||||
Interest revenue | 143,857 | 193,167 | 172,367 | 323.0 | 19.8 % | (10.8) % | 428,827 | 556,413 | 476,993 | 893.8 | 11.2 % | |||||||||||
Interest expense | (64,006) | (94,900) | (86,797) | (162.6) | 35.6 % | (8.5) % | (162,043) | (220,058) | (211,173) | (395.7) | 30.3 % | |||||||||||
Net interest revenue | 79,851 | 98,267 | 85,570 | 160.4 | 7.2 % | (12.9) % | 266,784 | 336,355 | 265,820 | 498.1 | (0.4) % | |||||||||||
Income from services, net | ||||||||||||||||||||||
Income from fees and other services | 45,033 | 43,875 | 48,420 | 90.7 | 7.5 % | 10.4 % | 124,698 | 170,705 | 133,776 | 250.7 | 7.3 % | |||||||||||
Other services expenses | (10,295) | (9,685) | (13,158) | (24.7) | 27.8 % | 35.9 % | (30,237) | (40,819) | (34,283) | (64.2) | 13.4 % | |||||||||||
Income from services, net | 34,738 | 34,190 | 35,262 | 66.0 | 1.5 % | 3.1 % | 94,461 | 129,886 | 99,493 | 186.5 | 5.3 % | |||||||||||
Other operating income, net | ||||||||||||||||||||||
Gains on financial instruments, net | (2,329) | 4,735 | 1,236 | 2.3 | n/a | (73.9) % | 4,338 | (3,227) | 7,196 | 13.5 | 65.9 % | |||||||||||
Foreign exchange transactions, net | 11,628 | 572 | 10,844 | 20.3 | (6.7) % | 1795.8 % | (6,665) | 18,084 | 5,844 | 11.0 | n/a | |||||||||||
T otal other operating income, net | 9,299 | 5,307 | 12,080 | 22.6 | 29.9 % | 127.6 % | (2,327) | 14,857 | 13,040 | 24.5 | n/a | |||||||||||
Operating Revenues | 123,888 | 137,764 | 132,912 | 249.0 | 7.3 % | (3.5) % | 358,918 | 481,098 | 378,353 | 709.1 | 5.4 % | |||||||||||
Provision for loan losses | (20,063) | (11,045) | (12,518) | (23.5) | (37.6) % | 13.3 % | (54,175) | (75,276) | (36,920) | (69.2) | (31.9) % | |||||||||||
Other income and expenses | ||||||||||||||||||||||
Recovery of loans previously charged-off | 12,714 | 9,295 | 7,910 | 14.8 | (37.8) % | (14.9) % | 27,370 | 34,546 | 25,028 | 46.9 | (8.6) % | |||||||||||
Non-operating income | 940 | 2,171 | 1,967 | 3.8 | 109.3 % | (9.4) % | 3,501 | 4,936 | 5,252 | 9.8 | 50.0 % | |||||||||||
Non-operating expenses | (5,838) | (3,580) | (3,198) | (5.9) | (45.2) % | (10.7) % | (13,327) | (16,293) | (8,671) | (16.2) | (34.9) % | |||||||||||
Participation in earnings of equity investments | 376 | 226 | 71 | 0.1 | (81.1) % | (68.6) % | 554 | 446 | 493 | 0.9 | (11.0) % | |||||||||||
Total other income and expenses | 8,192 | 8,112 | 6,750 | 12.8 | (17.6) % | (16.8) % | 18,098 | 23,635 | 22,102 | 41.4 | 22.1 % | |||||||||||
Operating expenses | ||||||||||||||||||||||
Personnel salaries and expenses | (34,177) | (40,194) | (36,296) | (68.0) | 6.2 % | (9.7) % | (99,361) | (139,877) | (110,777) | (207.6) | 11.5 % | |||||||||||
Administrative and other expenses | (23,228) | (25,089) | (28,760) | (53.9) | 23.8 % | 14.6 % | (64,472) | (90,494) | (76,523) | (143.4) | 18.7 % | |||||||||||
Depreciation and amortization | (4,313) | (4,416) | (4,379) | (8.2) | 1.5 % | (0.8) % | (12,178) | (16,360) | (12,696) | (23.8) | 4.3 % | |||||||||||
Total operating expenses | (61,718) | (69,699) | (69,435) | (130.1) | 12.5 % | (0.4) % | (176,011) | (246,731) | (199,996) | (374.8) | 13.6 % | |||||||||||
Loss from price-level restatement | (3,773) | (6,032) | (4,779) | (9.0) | 26.7 % | (20.8) % | (5,739) | (7,645) | (6,805) | (12.8) | 18.6 % | |||||||||||
Minority interest in consolidated subsidiaries | 0 | 0 | 0 | 0.0 | n/a | n/a | (1) | (1) | 0 | 0.0 | n/a | |||||||||||
Income before income taxes | 46,526 | 59,100 | 52,930 | 99.2 | 13.8 % | (10.4) % | 141,090 | 175,080 | 156,734 | 293.7 | 11.1 % | |||||||||||
Income taxes | (6,071) | (6,163) | (4,626) | (8.7) | (23.8) % | (24.9) % | (15,782) | (18,789) | (15,333) | (28.7) | (2.8) % | |||||||||||
Net income | 40,455 | 52,937 | 48,304 | 90.5 | 19.4 % | (8.8) % | 125,308 | 156,291 | 141,401 | 265.0 | 12.8 % | |||||||||||
The results have been prepared in accordance with Chilean GAAP on an unaudited, consolidated basis. All figures are expressed in constant Chilean pesos as of September 30, 2005, unless otherwise stated. Therefore, all growth rates are in real terms. All figures expressed in US dollars (except earnings per ADR) were converted using the exchange rate of Ch$533.69 for US$1.00 as of September 30, 2005. Earnings per ADR were calculated considering the nominal net income and, the exchange rate and the number of shares existing at the end of each period. |
2005 Third Quarter Results | |
BANCO DE CHILE |
CONSOLIDATED BALANCE SHEETS (Under Chilean GAAP) |
(Expressed in millions of constant Chilean pesos (MCh$) as of September 30, 2005 and m illions of US dollars (MUS$)) |
ASSET S | Dec 03 MCh$ | Sep 04 MCh$ | Dec 04 MCh$ | Jun 05 MCh$ | Sep 05 MCh$ | Sep-05 MUS$ |
% C h a n g e | |||||||||||
Sep 05-Sep 04 Sep 05-Dec 04Sep 05-Jun 05 | ||||||||||||||||||
Cash and due from banks | ||||||||||||||||||
Noninterest bearing | 676,024 | 610,780 | 552,588 | 783,645 | 887,110 | 1,662.2 | 45.2% | 60.5% | 13.2% | |||||||||
Interbank bearing | 223,309 | 129,068 | 359,402 | 442,018 | 86,193 | 161.5 | (33.2% ) | (76.0% ) | (80.5% ) | |||||||||
Total cash and due from banks | 899,333 | 739,848 | 911,990 | 1,225,663 | 973,303 | 1,823.7 | 31.6% | 6.7% | (20.6%) | |||||||||
Financial investments | ||||||||||||||||||
Government securities | 1,060,357 | 1,067,590 | 935,584 | 822,838 | 578,513 | 1,084.0 | (45.8% ) | (38.2% ) | (29.7% ) | |||||||||
Investments purchase under agreements to resell | 31,131 | 43,997 | 26,941 | 29,991 | 50,333 | 94.3 | 14.4% | 86.8% | 67.8% | |||||||||
Investment collateral under agreements to repurchase | 438,662 | 453,738 | 355,514 | 295,907 | 243,086 | 455.5 | (46.4% ) | (31.6% ) | (17.9% ) | |||||||||
Other investments | 481,223 | 277,129 | 327,808 | 288,308 | 436,994 | 818.8 | 57.7% | 33.3% | 51.6% | |||||||||
Total financial investments | 2,011,373 | 1,842,454 | 1,645,847 | 1,437,044 | 1,308,926 | 2,452.6 | (29.0%) | (20.5%) | (8.9%) | |||||||||
Loans, Net | ||||||||||||||||||
Commercial loans | 2,773,174 | 2,761,746 | 2,936,103 | 3,125,140 | 3,196,016 | 5,988.5 | 15.7% | 8.9% | 2.3% | |||||||||
Consumer loans | 617,884 | 697,175 | 708,455 | 764,688 | 794,010 | 1,487.8 | 13.9% | 12.1% | 3.8% | |||||||||
Mortgage loans | 1,183,980 | 965,258 | 839,559 | 722,721 | 688,379 | 1,289.8 | (28.7% ) | (18.0% ) | (4.8% ) | |||||||||
Foreign trade loans | 690,931 | 661,529 | 613,428 | 710,279 | 624,033 | 1,169.3 | (5.7% ) | 1.7% | (12.1% ) | |||||||||
Interbank loans | 13,879 | 41,648 | 15,563 | 7,641 | 39,666 | 74.3 | (4.8% ) | 154.9% | 419.1% | |||||||||
Lease contracts | 282,296 | 338,811 | 352,105 | 400,004 | 420,497 | 787.9 | 24.1% | 19.4% | 5.1% | |||||||||
Other outstanding loans | 462,867 | 756,436 | 958,671 | 1,141,835 | 1,188,281 | 2,226.5 | 57.1% | 24.0% | 4.1% | |||||||||
Past due loans | 110,736 | 100,255 | 86,717 | 83,075 | 75,956 | 142.3 | (24.2% ) | (12.4% ) | (8.6% ) | |||||||||
Contingent loans | 429,929 | 522,562 | 543,643 | 640,460 | 612,553 | 1,147.8 | 17.2% | 12.7% | (4.4% ) | |||||||||
Total loans | 6,565,676 | 6,845,420 | 7,054,244 | 7,595,843 | 7,639,391 | 14,314.2 | 11.6% | 8.3% | 0.6% | |||||||||
Allowances | (188,352) | (168,006) | (157,432) | (140,929) | (137,556) | (257.7) | (18.1% ) | (12.6% ) | (2.4% ) | |||||||||
Total loans, net | 6,377,324 | 6,677,414 | 6,896,812 | 7,454,914 | 7,501,835 | 14,056.5 | 12.3% | 8.8% | 0.6% | |||||||||
Other assets | ||||||||||||||||||
Assets received in lieu of payment | 16,402 | 16,844 | 16,517 | 15,034 | 13,159 | 24.7 | (21.9% ) | (20.3% ) | (12.5% ) | |||||||||
Bank premises and equipment | 134,092 | 135,559 | 135,854 | 138,680 | 138,147 | 258.9 | 1.9% | 1.7% | (0.4% ) | |||||||||
Investments in other companies | 5,559 | 5,663 | 5,542 | 7,134 | 7,131 | 13.4 | 25.9% | 28.7% | (0.0% ) | |||||||||
Other | 264,615 | 469,122 | 268,220 | 403,478 | 365,098 | 684.0 | (22.2% ) | 36.1% | (9.5% ) | |||||||||
Total other assets | 420,668 | 627,188 | 426,133 | 564,326 | 523,535 | 981.0 | (16.5%) | 22.9% | (7.2%) | |||||||||
T otal assets | 9,708,698 | 9,886,904 | 9,880,782 | 10,681,947 | 10,307,599 | 19,313.8 | 4.3% | 4.3% | (3.5%) | |||||||||
2005 Third Quarter Results | |
BANCO DE CHILE |
CONSOLIDATED BALANCE SHEETS (Under Chilean GAAP) |
(Expressed in millions of constant Chilean pesos (MCh$) as of September 30, 2005 and m illions of US dollars (MUS$)) |
LIABILITIES & SHAREHOLDERS' EQUITY | Dec 03 MCh$ | Sep 04 MCh$ | Dec 04 MCh$ | Jun 05 MCh$ | Sep 05 MCh$ | Sep-05 MUS$ |
% C h a n g e | |||||||||||
Sep 05-Sep 04 Sep 05-Dec 04Sep 05-Jun 05 | ||||||||||||||||||
Deposits | ||||||||||||||||||
Current accounts | 1,288,780 | 1,338,099 | 1,458,759 | 1,519,360 | 1,426,210 | 2,672.4 | 6.6% | (2.2% ) | (6.1% ) | |||||||||
Bankers drafts and other deposits | 696,358 | 831,929 | 714,215 | 834,135 | 662,095 | 1,240.6 | (20.4% ) | (7.3% ) | (20.6% ) | |||||||||
Saving accounts and time deposits | 3,592,293 | 3,657,154 | 3,751,610 | 4,093,543 | 4,209,867 | 7,888.2 | 15.1% | 12.2% | 2.8% | |||||||||
T otal deposits | 5,577,431 | 5,827,182 | 5,924,584 | 6,447,038 | 6,298,172 | 11,801.2 | 8.1% | 6.3% | (2.3%) | |||||||||
Borrowings | ||||||||||||||||||
Central Bank borrow ings | 29,264 | 2,706 | 112,202 | 1,608 | 1,539 | 2.9 | (43.1% ) | (98.6% ) | (4.3% ) | |||||||||
Securities sold under agreements to repurchase | 447,907 | 465,102 | 357,464 | 302,021 | 241,727 | 452.9 | (48.0% ) | (32.4% ) | (20.0% ) | |||||||||
Mortgage finance bonds | 1,064,769 | 934,197 | 807,821 | 629,617 | 591,288 | 1,107.9 | (36.7% ) | (26.8% ) | (6.1% ) | |||||||||
Other bonds | 3,282 | 184,406 | 185,871 | 273,952 | 318,180 | 596.2 | 72.5% | 71.2% | 16.1% | |||||||||
Subordinated bonds | 284,648 | 275,193 | 272,695 | 307,286 | 304,637 | 570.8 | 10.7% | 11.7% | (0.9% ) | |||||||||
Borrowings from domestic financial institutions | 52,356 | 49,529 | 27,033 | 256,171 | 148,781 | 278.8 | 200.4% | 450.4% | (41.9% ) | |||||||||
Foreign borrowings | 753,580 | 459,016 | 609,841 | 706,623 | 622,939 | 1,167.2 | 35.7% | 2.1% | (11.8% ) | |||||||||
Other obligations | 62,556 | 47,641 | 45,923 | 46,573 | 49,982 | 93.7 | 4.9% | 8.8% | 7.3% | |||||||||
Total borrowings | 2,698,362 | 2,417,790 | 2,418,850 | 2,523,851 | 2,279,073 | 4,270.4 | (5.7%) | (5.8%) | (9.7%) | |||||||||
Other liabilities | ||||||||||||||||||
Contingent liabilities | 429,956 | 525,379 | 544,944 | 641,000 | 612,589 | 1,147.8 | 16.6% | 12.4% | (4.4% ) | |||||||||
Other | 272,763 | 454,243 | 301,681 | 442,402 | 387,264 | 725.7 | (14.7% ) | 28.4% | (12.5% ) | |||||||||
Total other liabilities | 702,719 | 979,622 | 846,625 | 1,083,402 | 999,853 | 1,873.5 | 2.1% | 18.1% | (7.7%) | |||||||||
Minority interest in consolidated subsidiaries | 5 | 1 | 1 | 1 | 1 | 0.0 | 0.0% | 0.0% | 0.0% | |||||||||
Shareholders' equity | ||||||||||||||||||
Capital and Reserv es | 593,153 | 537,001 | 534,431 | 533,348 | 589,099 | 1,103.8 | 9.7% | 10.2% | 10.5% | |||||||||
Net income for the y ear | 137,028 | 125,308 | 156,291 | 94,307 | 141,401 | 264.9 | 12.8% | (9.5% ) | 49.9% | |||||||||
Total shareholders' equity | 730,181 | 662,309 | 690,722 | 627,655 | 730,500 | 1,368.7 | 10.3% | 5.8% | 16.4% | |||||||||
T otal liabilities & shareholders' equity | 9,708,698 | 9,886,904 | 9,880,782 | 10,681,947 | 10,307,599 | 19,313.8 | 4.3% | 4.3% | (3.5%) | |||||||||
2005 Third Quarter Results | |
BANCO DE CHILE |
SELECTED CONSOLIDATED FINANCIAL INFORM ATION |
Q u a r t e r s | Y e a r e n d e d | |||||||||||
3Q04 | 2Q05 | 3Q05 | Sep.04 | Dec.04 | Sep.05 | |||||||
Earnings per Share | ||||||||||||
Net income per Share (Ch$) (1) | 0.61 | 0.80 | 0.71 | 1.89 | 2.35 | 2.08 | ||||||
Net income per ADS (Ch$) (1) | 365.68 | 478.51 | 425.71 | 1,132.68 | 1,412.74 | 1,246.19 | ||||||
Net income per ADS (US$) (2) | 0.60 | 0.83 | 0.80 | 1.87 | 2.52 | 2.34 | ||||||
Book value per Share (Ch$) (1) | 9.98 | 9.45 | 10.73 | 9.98 | 10.40 | 10.73 | ||||||
Shares outstanding (Millions) | 66,378 | 66,378 | 68,080 | 66,378 | 66,378 | 68,080 | ||||||
Profitability Ratios (3)(4) | ||||||||||||
Net Interest Margin | 3.57% | 4.18% | 3.75% | 4.06% | 3.84% | 3.93% | ||||||
Net Financial Margin | 4.09% | 4.21% | 4.23% | 3.96% | 4.04% | 4.01% | ||||||
Fees / Avg. Interest Earnings Assets | 1.55% | 1.46% | 1.55% | 1.44% | 1.48% | 1.47% | ||||||
Other Operating Revenues / Avg. Interest Earnings Assets | 0.42% | 0.23% | 0.53% | -0.04% | 0.17% | 0.19% | ||||||
Operating Revenues / Avg. Interest Earnings Assets | 5.54% | 5.86% | 5.83% | 5.47% | 5.49% | 5.59% | ||||||
Return on Average Total Assets | 1.63% | 2.00% | 1.86% | 1.70% | 1.59% | 1.85% | ||||||
Return on Average Shareholders' Equity | 24.94% | 35.32% | 28.16% | 25.25% | 23.56% | 29.06% | ||||||
Capital Ratios | ||||||||||||
Shareholders Equity / Total Assets | 6.70% | 5.88% | 7.09% | 6.70% | 6.99% | 7.09% | ||||||
Basic Capital / total assets | 5.39% | 4.96% | 5.68% | 5.39% | 5.37% | 5.68% | ||||||
Basic Capital / Risk-Adjusted Assets | 8.04% | 7.26% | 7.98% | 8.04% | 7.81% | 7.98% | ||||||
Total Capital / Risk-Adjusted Assets | 12.06% | 11.32% | 11.97% | 12.06% | 11.67% | 11.97% | ||||||
Credit Quality Ratios | ||||||||||||
Past Due Loans / Total Loans | 1.46% | 1.09% | 0.99% | 1.46% | 1.23% | 0.99% | ||||||
Allowance for Loan losses / Past-due loans | 167.58% | 169.64% | 181.10% | 167.58% | 181.55% | 181.10% | ||||||
Allowance for Loans Losses / Total Loans | 2.45% | 1.86% | 1.80% | 2.45% | 2.23% | 1.80% | ||||||
Provision for Loan Losses / Avg.Loans (4) | 1.16% | 0.58% | 0.66% | 1.07% | 1.11% | 0.67% | ||||||
Operating and Productivity Ratios | ||||||||||||
Operating Expenses / Operating Revenue | 49.82% | 50.59% | 52.24% | 49.04% | 51.28% | 52.86% | ||||||
Operating Expenses / Average Total Assets (3) | 2.49% | 2.63% | 2.67% | 2.39% | 2.51% | 2.62% | ||||||
Loans per employee (million Ch$) (1) | 738 | 796 | 774 | 738 | 753 | 774 | ||||||
Average Balance Sheet Data (1)(3) | ||||||||||||
Avg. Interest Earnings Assets (million Ch$) | 8,944,516 | 9,396,076 | 9,116,425 | 8,756,010 | 8,766,195 | 9,024,097 | ||||||
Avg. Assets (million Ch$) | 9,924,811 | 10,593,752 | 10,406,400 | 9,821,963 | 9,831,653 | 10,183,318 | ||||||
Avg. Shareholders Equity (million Ch$) | 648,753 | 599,436 | 686,117 | 661,737 | 663,475 | 648,817 | ||||||
Avg. Loans | 6,900,001 | 7,553,711 | 7,575,615 | 6,728,992 | 6,788,921 | 7,371,841 | ||||||
Avg. Interest Bearing Liabilities (million Ch$) | 6,371,175 | 6,714,586 | 6,551,617 | 6,284,092 | 6,234,038 | 6,382,499 | ||||||
Other Data | ||||||||||||
Inflation Rate | 0.66% | 1.59% | 1.91% | 2.25% | 2.43% | 3.76% | ||||||
Exchange rate (Ch$) | 606.96 | 578.92 | 533.69 | 606.96 | 559.83 | 533.69 | ||||||
Employees | 9,271 | 9,542 | 9,896 | 9,271 | 9,365 | 9,896 | ||||||
Notes |
(1) These figures were expressed in constant Chilean pesos as of September 30, 2005. |
(2) These figures were calculated considering the nominal net income, the shares outstanding and the exchange rates existing at the end of each period. |
(3) The ratios were calculated as an average of daily balances. |
(4) Annualized data. |
2005 Third Quarter Results | |
CONTACTS: | Jacqueline Barrio | |
(56-2) 653 2938 | ||
jbarrio@bancochile.cl | ||
Rolando Arias | ||
(56-2) 653 3535 | ||
rarias@bancochile.cl |
FORWARD-LOOKING INFORMATION
The information contained herein incorporates by reference statements which constitute forward-looking statements, in that they include statements regarding the intent, belief or current expectations of our directors and officers with respect to our future operating performance. Such statements include any forecasts, projections and descriptions of anticipated cost savings or other synergies. You should be aware that any such forward-looking statements are not guarantees of future performance and may involve risks and uncertainties, and that actual results may differ from those set forth in the forward-looking statements as a result of various factors (including, without limitations, the actions of competitors, future global economic conditions, market conditions, foreign exchange rates, and operating and financial risks related to managing growth and integrating acquired businesses), many of which are beyond our control. The occurrence of any such factors not currently expected by us would significantly alter the results set forth in these statements.
Factors that could cause actual results to differ materially and adversely include, but are not limited to: | ||
| changes in general economic, business or political or other conditions in Chile or changes in general economic or business conditions in Latin America; | |
| changes in capital markets in general that may affect policies or attitudes toward lending to Chile or Chilean companies; | |
| unexpected developments in certain existing litigation; | |
| increased costs; | |
| unanticipated increases in financing and other costs or the inability to obtain additional debt or equity financing on attractive terms; and |
You should not place undue reliance on such statements, which speak only as of the date that they were made. Our independent public accountants have not examined or compiled the forward-looking statements and, accordingly, do not provide any
assurance with respect to such statements. These cautionary statements should be considered in connection with any written or oral forward-looking statements that we may issue in the future. We do not undertake any obligation to release publicly any
revisions to such forward-looking statements after completion of this offering to reflect later events or circumstances or to reflect the occurrence of unanticipated events.
Date: October 28, 2005 |
Banco de Chile | ||
/S/ Julio Guzmán H. |
||
By: Julio Guzmán Herrera
Acting General Manager |