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Banco Santander-Chile Announces First Quarter 2025 Earnings

1. Banco Santander Chile's 1Q25 net income rose 131% YoY to $278 billion. 2. ROAE at 25.7% marks four consecutive quarters above 20%. 3. Dividend yield stands at 5.4%, appealing investors seeking income. 4. Customer base grew 9.4% YoY, showing strong demand for digital products. 5. CET1 ratio remains robust at 10.7%, indicating financial stability.

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$23.4505/01 03:07 PM EDTLatest Updated
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FAQ

Why Very Bullish?

The significant increase in net income and ROAE indicates robust performance, supporting a positive outlook for BSAC's stock price. Historically, similar financial performance metrics have led to stock price appreciation.

How important is it?

The article details strong financial performance and dividend increases, indicating solid company health, likely to attract investor interest and impact stock prices significantly.

Why Short Term?

Positive quarterly results can quickly influence investor sentiment and lead to short-term price rallies, evident in past BSAC reports.

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BSACSAN
SANTIAGO, Chile, April 30, 2025 (GLOBE NEWSWIRE) -- Banco Santander Chile (NYSE: BSAC; SSE: Bsantander) announced today its results1 for the three-month period ended March 31, 2025, and first quarter 2025 (1Q25). Solid financial performance with a ROAE2 of 25.7% in 1Q253, the fourth consecutive quarter with a ROAE of over 20%. As of March 31, 2025, the bank's net income attributable to shareholders totaled $278 billion ($1.47 per share and $0.62 per ADR), representing a 131.0% YoY4 increase and an ROAE of 25.7%, compared to an ROAE of 11.2% in 1Q24. The increase in results is explained by an increase in the bank's main revenue lines. Operating income increased 33.2% YoY, driven by better net interest and readjustment income. Compared to the previous quarter, 4Q24, the bank's net income attributable to shareholders increased by 0.5%. The UF variation in 1Q25 was slightly lower than in 4Q24, which reduced QoQ5 readjustment gains. This was offset by higher fees and results from financial transactions and improved expense control. This resulted in a ROAE of 25.7% in 1Q25, marking the fourth consecutive quarter with ROAEs above 20%. Dividend payment of Ch$3.19 per share with a dividend yield of 5.4%. A solid CET1 ratio6 of 10.7%. At our Ordinary Shareholders' Meeting on April 22, 2025, the distribution of 70% of our 2024 earnings, amounting to $857,623 million, was approved. These earnings represent a dividend of $3.18571574 Chilean pesos per share, for a total of $600,336 million. Likewise, it was approved that the remaining 30% be partially allocated to increasing the Accumulated Earnings from previous years by the amount necessary to cover the payment of the next three interest coupons on the fixed-term bonds for $29.993 billion and to increase the Bank's Reserves and Other Retained Earnings by $227.294 billion. Our CET1 ratio remains at a solid 10.7% at the end of March 2025, with the overall Basel III ratio reaching 16.9%. The Bank's capital includes a dividend payment provision of 70% of 2024 earnings and a 60% provision of 2025 earnings to date. Strong recovery of NIM7, reaching 4.1% in 1Q25 Net interest and readjustment income (NII) accumulated as of March 31, 2025, increased 41.7% compared to the same period in 2024. This increase in NII was due to higher net interest income due to the impact of a lower monetary policy rate on our funding cost, which fell from 5.3% to 3.9% in 3M25. The increase is also explained by higher readjustment income, resulting from a greater variation in the UF during the quarter compared to the same quarter last year. Compared to 4Q24, net interest and readjustment income decreased slightly due to lower inflation in 1Q25 compared to the previous quarter. Given the above, the NIM increased from 2.7% in 1Q24 to 4.2% in 4Q24 to 4.1% in 1Q25. Gravity: Migration of our systems to the cloud. Best-in-class efficiency8 of 35.0% in 1Q25. In 1Q25, the Bank celebrated the major milestone of the Gravity project, the migration from the Mainframe to the Cloud. In January, we transitioned processing to our new Cloud, which resulted in higher technology expenses related to the change and write-downs and impairments related to legacy systems. The Bank's efficiency ratio reached 35.0% as of March 31, 2025, better than the 47.4% of the same period in the previous year. Total operating expenses (which include other expenses) decreased 1.7% in 3M25 compared to 3M24, driven by lower other operating expenses related to the restructuring of our branch network and the transformation to Work/Café. The customer base continues to expand, with total customers increasing by 9.4% YoY and digital customers increasing by 6.6% YoY. Our strategy of strengthening our digital products has led to continued growth in our customer base, reaching approximately 4.3 million customers, of which nearly 2.3 million are digital customers (88% of our active customers). The Bank's market share in checking accounts remains strong at 22.5% through February 2025, driven by increased customer demand for US dollar checking accounts, as customers can open these types of accounts digitally through our platform in a few easy steps. This also demonstrates the success of Getnet's strategy to encourage cross-selling of other products such as the Cuenta Pyme Life. Net commissions increased by 16.8% in 3M25, reaching recurrence levels9 of 61.8%. Net commissions increased 16.8% in the three months ended March 31, 2025, compared to the same period in 2024, driven by increased customer numbers and greater product usage. As a result, the recurrence ratio (total net commissions divided by structural support expenses) increased from 57.8% as of March 2024 to 61.8% as of March 2025, demonstrating that more than half of the Bank's expenses are financed by commissions generated by our customers. Banco Santander Chile is one of the companies with the highest risk ratings in Latin America, with an A2 rating from Moody's, A- from Standard & Poor's, A+ from the Japan Credit Rating Agency, AA- from HR Ratings, and A from KBRA. All of our ratings have a stable outlook as of the date of this report. As of March 31, 2025, the bank had total assets of Ch$67,059,423 million (US$70,284 million), total gross loans (including those owed by banks) at amortized cost of Ch$41,098,666 million (US$43,075 million), total deposits of Ch$30,607,715 million (US$32,080 million), and bank owners' equity of Ch$4,400,233 million (US$4,612 million). The BIS capital ratio was 16.9%, with a core capital ratio of 10.7%. As of March 31, 2025, Santander Chile employed 8,712 people and had 237 branches throughout Chile. CONTACT INFORMATIONCristian VicuñaChief Strategy Officer and Head of Investor RelationsBanco Santander ChileBandera 140, Floor 20Santiago, ChileEmail: irelations@santander.cl Website: www.santander.cl 1 The information contained in this report is presented in accordance with Chilean Bank GAAP as defined by the Financial Markets Commission (FMC).2 Annualized net income attributable to shareholders of the Bank divided by the average equity attributable to equity holders3 The first quarter of 20254 Year on year.5 Quarter on quarter6 Common Equity Tier 1 under Chilean regulation.7 NIM: Net interest margin. Net interest income and annualized adjustments divided by interest-earning assets.8 Efficiency: operating expenses including impairment and other operating expenses/ financial margin + fees+ financial transactions and net other operating income.9 Recurrence: net commissions divided bycore support costs.

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