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Banco Santander-Chile Announces Fourth Quarter 2024 Earnings

1. BSAC reports 72.8% YoY net income growth attributed to strong financial performance. 2. NIM recovered to 3.6% in 2024 due to reduced funding costs. 3. Customer base expanded by 6.4% YoY, reflecting successful digital strategy. 4. Efficiency ratio improved to 39.0%, showing effective cost management. 5. Solid capital levels maintained with a BIS ratio of 17.1%.

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Why Bullish?

BSAC's strong financial metrics and customer growth indicate positive trend, similar to past performance spikes.

How important is it?

The article highlights BSAC's robust earnings and customer growth, likely to attract investors.

Why Long Term?

Sustained growth in customer base and financial performance indicates ongoing stability, like previous years.

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BSAC
SANTIAGO, Chile, Jan. 31, 2025 (GLOBE NEWSWIRE) -- Banco Santander Chile (NYSE: BSAC; SSE: Bsantander) announced today its results1 for the twelve-month period ended December 31, 2024, and fourth quarter 2024 (4Q24). Strong Financial Performance with ROAE2 of 26.0% in 4Q243 and 20.2% in 12M244. As of December 31, 2024, the Bank's net income attributable to shareholders totaled $858 billion ($4.55 per share and US$1.83 per ADR), marking a 72.8% increase compared to the same period of the previous year and with an ROAE of 20.2%. In 4Q24, net income attributable to shareholders of the Bank totaled $277 billion, increasing 13.7% in the quarter with a quarterly ROAE of 26.0%. This marks the third consecutive quarter with an ROAE above 20%. The improvement in results is explained by an increase in the Bank's main revenue lines. Operating income increased by 34.5% YoY, supported by a stronger interest margin and readjustments. Robust NIM5 recovery, reaching 3.6% in 2024 and 4.2% in 4Q24. Net interest and readjustment income (NII) for the year ended December 31, 2024 increased by 62.1% compared to the same period in 2023. This growth was primarily due to higher net interest income, resulting from a lower monetary policy rate that reduced our funding costs from 6.8% to 4.7% in 12M24. This was partially offset by lower readjustment income due to a smaller variation in the UF compared to the previous year. Consequently, the NIM improved from 2.2% in 2023 to 3.6% in 2024, and further to 4.2% in 4Q24. Continued Expansion of Customer Base with a 6.4% YoY Increase in Total Customers and a 5.9% YoY Increase in Digital Customers Our strategy to enhance digital products has led to a continued growth in our customer base reaching approximately 4.3 million customers, with over 2.2 million digital customers (88% of our active customers). The Bank's market share in current accounts remains robust at 23.2% as of October 2024, driven by increased customer demand for US dollar current accounts which can be easily opened digitally by our customers. It also demonstrates the success of Getnet's strategy in encouraging cross-selling of other products such as the Cuenta Pyme Life. Customer funds increased 4.7% QoQ and 12.6% since December 2023. Customer funds (demand deposits, time deposits and mutual funds) increased by 4.7% QoQ and 12.6% from December 2023, reflecting client growth and fund accumulation. The Bank's total deposits increased by 5.7% from December 31, 2023, explained by the 5.3% increase in demand deposits and the 6.0% increase in time deposits. In the quarter, total deposits grew by 5.9%, with demand deposits up by 8.7% and time deposits by 3.7%. The strong growth in the quarter is explained by the seasonality of deposits at the end of the year, especially among corporate clients. Our customer's investments through mutual funds intermediated by the Bank also grew in the quarter, reaching an increase of 2.2% QoQ and 32.6% since December 31, 2023, given the clients' preference for mutual funds in this scenario of falling rates. Net fees and commissions increase 8.8% in 12M24, achieving a recurrence6 level of 60.3%. Net fees increased 8.8% in the twelve months ended December 31, 2024 compared to the same period in 2023 due to increased client numbers and higher product usage. As a result, the recurrence ratio (total net fees divided by structural support expenses) increased from 57.4% YTD as of December 2023 to 60.3% YTD as of December 2024, demonstrating that more than half of the Bank's expenses are financed by fees generated by our clients. Efficiency ratio of 36.5% in 4Q24 and 39.0% in 4Q24 The Bank's efficiency ratio reached 39.0% as of December 31, 2024, compared to the 46.6% of the same period last year, with a quarterly efficiency ratio of 36.5%. On the other hand, the cost to assets ratio increased to 1.5% in 12M24 vs. 1.3% in the same period of the previous year. Structural support expenses (salaries, administration and amortization) grew 3.5% in 12M24 compared to 12M23, below inflation, and in line with the guidance provided previously and a slight decrease of 1.8% compared to 3Q24 mainly due to lower salary expenses. Total operating expenses (which includes other expenses) increased 12.4% in 12M24 compared to 12M23 driven by higher other operating expenses, related to a provision for the restructuring of our branch network and the transformation to Work/Café and also advances in digital banking. Cost of credit of 1.29% in 12M24, and NPL coverage at 115.4% During the Covid-19 pandemic, asset quality benefited from state aid and pension fund withdrawals, which led to a positive performance in assets during that period, before normalizing in line with the performance of the economy and the drainage of excess liquidity from households. Currently, our clients' performance is reflecting the state of the economy and the labor market, where delinquency is higher than the levels we saw before the pandemic with the non-performing loans (NPL) ratio increasing to 3.2% and the impaired portfolio to 6.7% at December 2024. Overall the cost of credit remained stable at 1.29% in the quarter. Solid capital levels with a BIS7 ratio of 17.1% and a CET18 of 10.5%. Our CET1 (Common Equity Tier 1) ratio remains at solid levels of 10.5% and the total Basel III ratio reaches 17.1% at the end of December 2024, which includes a provision of dividend payment of 70% of 2024 earnings. We made significant progress in our Chile First strategy in 2024 Largest bank in terms of loans and deposits (16.9% market share according to latest information from the CMF).More than US$ 450 million committed to invest in infrastructure and technology between 2023 and 2026.A total of 99 Workcafés in Chile, serving our clients and the community in their different formats.Recognized by Euromoney as the Best Bank in the Country in the SME and ESG Categories.The only Chilean bank included in the DJSI emerging markets and within the top 3% of the most sustainable banks in the world.Top Employer Certification January 2025 (seventh consecutive year).Recognized as the Best Bank in Chile for SMEs by Global Finance.ALAS20: First place in the category of leading company in sustainability.Institutional Investor: "Most Honored Company." 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 and Poor's, A+ from Japan Credit Rating Agency, AA- from HR Ratings and A from KBRA. All our ratings as of the date of this report have a stable outlook. As of December 31, 2024, the Bank has total assets of $68,458,933 million (US$68,865 million), total gross loans (including loans to banks) at amortized cost of $41,323,844 million (US$41,569 million), total deposits of $31,359,234 million (US$31,545 million) and shareholders' equity of $4,292,440 million (US$4,318 million). The BIS capital ratio was 17.1%, with a core capital ratio of 10.5%. As of December 31, 2024, Santander Chile employs 8,757 people and has 236 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 fourth quarter of 20244 The twelve months accumulated as of December31, 20245 NIM: Net interest margin. Annualized net interest income and annualized readjustments divided by interest-earning assets6Recurrence: Net commissions divided by structural operating expenses (excludes other operating expenses).7 Regulatory capital divided by risk-weighted assets, according to CMF BIS III definitions8 Core capital divided by risk-weighted assets, according to CMF BIS III definitions.

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