Argentina's largest banks saw a 35.3% increase in their third-quarter profits as still-high borrowing costs in the country led to a surge in net interest income, according to data compiled by S&P Global Market Intelligence.
Combined net income for the country's three largest listed banks – Banco Santander Río SA, Grupo Financiero Galicia SA and Banco Macro SA – reached 6.06 billion Argentine pesos in the third quarter, up from 4.48 billion pesos a year earlier.
The improvement in aggregate profitability was driven by strong results from Banco Macro and Galicia. Banco Macro's quarterly profit jumped 59.5% year over year to 2.60 billion pesos, while Galicia's improved 46.1% to 2.22 billion pesos. Santander Río was the laggard among the group, posting a 5.3% decline in profit mainly due to a sharp spike in both administrative expenses and loan-loss provisions.
Aggregate net interest income for the group climbed 66.3% to 12.34 billion pesos. Net fees and commissions, meanwhile, rose 28.3% to 7.62 billion pesos. Those gains helped offset higher combined expenses, which shot up by 47.6% to 21.21 billion pesos from 14.37 billion pesos in the year-ago quarter.
The Argentine central bank's benchmark interest rate ended the third quarter at 26.25%, although it has risen to 28.75% since then.

As of Nov. 27, US$1 was equivalent to 17.34 Argentine pesos.
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