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SBIF: Chilean bank sector profits fell 2.57% in Q1 as higher loan provisions weigh

TheChilean banking sector's net profit fell 2.57% in the first quarter of 2016 to475.78 billion Chilean pesos compared to the same period a year ago, bankingregulator SBIF said in its monthly banking system update published April 29.

Higherspending on loan provisions was the main reason for the decline, as the ratioof provisions to total loans rose to 2.51% in March from 2.39% a year ago.

Annualizedreturn on average equity came to 14.53% in March, down from 16.78% a year ago.

Totalloans rose 6.36% year over year in March, down from the 7.10% growth inFebruary, the regulator said. Commercial loans grew 6.08%, while consumer loansrose 4.40% and mortgages jumped 11.25%.

Theratio of bank loans overdue by 90 days or more to total loans was 1.96% inMarch, up from 1.92% in February but down from 2.05% a year ago.

Separately,the SBIF said that the cooperatives it supervises posted profits of 10.95billion pesos through March with an annualized return on equity of 8.78%, downfrom 10.41% recorded a year earlier.

Totalloans by the cooperatives dropped 0.37% annually in real terms. Althoughconsumer loans rose 0.25% and mortgages climbed 0.34% in 12 months, commercialloans fell 8.91% in real terms.

As of April 28, US$1 wasequivalent to 667.70 Chilean pesos.