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Slide in provisions helps raise BancoEstado's Q1 income

Banco del Estado de Chile reported higher net income in the first quarter as provision expenses went down, and net interest and fee income rose.

The Chilean state lender booked about 47.77 billion pesos in net income after taxes during the three-month period, 4.1% higher than about 45.86 billion pesos in the same period last year.

Net interest income ticked 4.6% higher to about 202.91 billion pesos in the quarter from roughly 193.94 billion pesos in the year-ago period. The bank's net interest margin stood at 3.3%, up from 3.2.% in the linked quarter, and unchanged from a year ago.

Fee income rose 14.0% higher to nearly 75.12 billion pesos, while net income from inflation adjustments rose 73.3% to around 33.84 billion pesos. However, the bank's net gain from financial operations plunged 64.0% to 25.48 billion pesos from 70.86 billion pesos.

BancoEstado booked provision expenses of nearly 52.12 billion pesos, a 16.8% difference than last year's figure of 62.66 billion pesos.

Total operating expenses, however, saw an 8.7% yearly increase, as personnel and administrative expenses ticked 4.7% and 11.3% year over year, respectively.

BancoEstado's loan portfolio held around 22.40 billion pesos as of the end of March, higher than the 20.89 billion pesos registered in the previous year. The ratio of nonperforming loans to total loans was at 3.30% during the three-month period, compared to 3.09% in the linked quarter and 3.63%in the year-ago period.

The lender's annualized return on average equity, before taxes, rose to 19.4% in the period from 18.0% a year ago.

As of May 18, US$1 was equivalent to 637.75 Chilean pesos.