Credicorp (BAP) Q3 2024 earnings summary

Executive summary

• Achieved record net income of S/1,524 million in 3Q24, up 13.8% QoQ and 21.3% YoY, with ROE at 18.5% and cumulative 9M24 ROE at 17.7%.

• Special dividend of S/11 per share declared, raising annual payout ratio to 75.3%.

• Performance driven by improved macro environment, strategic initiatives, and diversified revenue streams.

• Expansion milestones include provisional approval for Tenpo Bank Chile and acquisition of Banmédica's 50% stake in joint ventures.

• Economic recovery in Peru supported by low inflation, favorable commodity prices, and public investments.

Financial highlights

• Net interest income rose 3.5% QoQ and 10.3% YoY; NIM improved to 6.43% in 3Q24.

• NPL ratio dropped 12 bps QoQ to 5.9%; provisions fell 20.6% QoQ; cost of risk at 2.4%.

• Efficiency ratio improved to 44.6% for 9M24; operating expenses up 8.8% YTD.

• Core income grew 9.8% YoY and 0.8% QoQ, mainly from NII and fees.

• Total loans contracted 1.2% QoQ and YoY; low-cost deposits comprised 56.2% of funding base.

Outlook and guidance

• 2024 guidance maintained: Peru GDP growth around 3%, NIM 6.0%-6.4%, cost of risk 2.0%-2.5%, efficiency ratio 46.0%-48.0%, and ROE around 17%.

• Loan growth guidance revised to around 0% for 2024.

• Long-term ROE target of 18% maintained, with disruptive initiatives to contribute 10% of revenues after provisions by 2026.