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Intercorp Financial's Q2 profit rises 20.8% YOY

Intercorp Financial Services Inc. reported a 20.8% annual increase in its second-quarter profit as the company's insurance unit, Interseguro Compañía de Seguros SA, posted a net profit partly due to a decrease in impairment loss on available-for-sale investments and in an adjustment of technical reserves.

Intercorp Financial's net profit for the three-month period rose to 215.0 million Peruvian soles from 178.0 million soles a year earlier, the company said in an Aug. 9 earnings release.

EPS for the quarter came in at 2.02 soles, compared to 1.62 soles in the year-ago period.

Net interest and similar income totaled 642.1 million soles, down 4.1% from 669.3 million soles in the linked quarter and 0.6% less from 645.8 1 million soles a year earlier. Net fee income from financial services, meanwhile, ticked 1.3% higher year over year to 218.2 million soles. Other income declined 12.1% annually to 137.2 million soles.

At the same time, the company booked 214.3 million soles in provisions for loan losses, net of recoveries, in the second quarter, down 3.8% from the first quarter and 1.9% higher than in the year-ago period. Intercorp attributed the annual rise mainly to higher provisioning in consumer loans at the company's banking subsidiary.

Insurance unit Interseguro posted a net loss of 13.8 million soles in the second quarter, compared to 55.8 million soles a year earlier. Banking subsidiary Banco Internacional del Perú S.A.A., known as Interbank, posted net income of 209.1 million soles compared to 199.8 million soles a year ago.

The insurance unit saw net premiums rise 12.3% on a yearly basis to 146.1 million soles, with annuities premiums increasing 13.2%.

Interseguro also booked a negative impact of 101.0 million soles on adjustment of technical reserves in the second quarter, compared to a higher negative impact of 135.5 million soles a year earlier.

Intercorp Financial's return on average equity increased to 16.4% from 15.1% in the second quarter of 2016, while its return on average assets rose to 1.7% from 1.5%.

As of Aug. 10, US$1 was equivalent to 3.25 Peruvian soles.