-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CTY99h/x4YCfEUa/EYfQXpCWPvEg3eqPx9DVNFImH9JUzePCn3H+U2j/JrQuqKVQ AgG2RE+yBDnmj2r1GMy2ag== 0000950123-05-009563.txt : 20050808 0000950123-05-009563.hdr.sgml : 20050808 20050808163050 ACCESSION NUMBER: 0000950123-05-009563 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20050808 FILED AS OF DATE: 20050808 DATE AS OF CHANGE: 20050808 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BANCOLOMBIA SA CENTRAL INDEX KEY: 0001071371 STANDARD INDUSTRIAL CLASSIFICATION: COMMERCIAL BANKS, NEC [6029] IRS NUMBER: 000000000 STATE OF INCORPORATION: F8 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 6-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-32535 FILM NUMBER: 051006270 BUSINESS ADDRESS: STREET 1: CARRERA 52 #50-20 STREET 2: CALLE 50 #51-66 CITY: MEDELLIN STATE: F8 ZIP: 00000 BUSINESS PHONE: 5745108866 MAIL ADDRESS: STREET 1: CARRERA 52 #50-20 STREET 2: CALLE 50 #51-66 CITY: MEDELLIN STATE: F8 ZIP: 00000 6-K 1 y11449ce6vk.txt FORM 6-K CONFORMED COPY SECURITIES AND EXCHANGE COMMISSION Washington D.C. 20549 FORM 6-K REPORT OF FOREIGN PRIVATE ISSUER Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1933 For the month of August 2005 BANCOLOMBIA S.A. (Translation of Registrant's name into English) Calle 50 No. 51-66 Medellin, Colombia (Address of principal executive offices) (Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.) Form 20-F [X] Form 40-F [ ] (Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.) Yes [ ] No [X] (If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-______________.) This Report on Form 6-K shall be incorporated by reference into the registrant's registration statement on Form F-3 (File No. 001-32535). SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. BANCOLOMBIA S.A. (Registrant) Date: August 8, 2005 By /s/ JAIME ALBERTO VELASQUEZ B. ------------------------------------- Name: Jaime Alberto Velasquez B. Title: Vice President of Finance [BANCOLOMBIA LOGO] [NYSE LOGO] CONSOLIDATED FINANCIAL RESULTS FOR THE QUARTER ENDED JUNE 30, 2005 Table of Contents 1. HIGHLIGHTS 2. CONSOLIDATED BALANCE SHEET 3. INCOME STATEMENT 4. SUBSIDIARIES 5. PRO-FORMA FINANCIAL STATEMENTS AUGUST 8, 2005. Medellin, Colombia - Today, BANCOLOMBIA S.A. (NYSE: CIB) announced the financial results for the quarter ended June 30, 2005.(1)
CONSOLIDATED BALANCE SHEET AND INCOME STATEMENT QUARTER GROWTH (Ps millions) 1Q 05 2Q 05 2Q 05/1Q 05 ---------- ---------- ---------- ASSETS Loans and financial leases, net 10.159.139 10.655.883 4,89% Investment securities, net 5.313.772 5.601.841 5,42% Other assets 2.745.231 2.465.501 -10,19% ---------- ---------- ---------- TOTAL ASSETS 18.218.142 18.723.225 2,77% ---------- ---------- ---------- LIABILITIES AND SHAREHOLDERS' EQUITY Deposits 12.111.704 11.764.696 -2,87% Other liabilities 4.123.444 4.721.342 14,50% TOTAL LIABILITIES 16.235.148 16.486.038 1,55% Shareholders' equity 1.982.994 2.237.187 12,82% ---------- ---------- ---------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 18.218.142 18.723.225 2,77% ---------- ---------- ---------- Interest income 464.374 530.775 14,30% Interest expense 169.808 174.122 2,54% NET INTEREST INCOME 294.566 356.653 21,08% Net provisions (26.131) (27.392) 4,83% Other operating income 175.494 167.605 -4,50% Other operating expense (253.465) (264.615) 4,40% Non-operating income, net 944 1.357 43,75% Income tax expense (63.684) (63.727) 0,07% ---------- ---------- ---------- NET INCOME 127.724 169.881 33,01% ---------- ---------- ----------
- ---------- 1 This report corresponds to the consolidated financial statements of BANCOLOMBIA and its affiliates of which it owns, directly or indirectly, 50% or more of the voting capital stock. For this reason, the financial information contained herein is not comparable to BANCOLOMBIA's consolidated results (including the results of its financial subsidiaries) released prior to March 2003. This information has been prepared in accordance with generally accepted accounting principles in Colombia, is stated in nominal terms and has not been audited. All growth rates mentioned herein are not adjusted for inflation. ANY REFERENCE TO BANCOLOMBIA MUST BE UNDERSTOOD AS TO THE BANK TOGETHER WITH ITS AFFILIATES, UNLESS OTHERWISE SPECIFIED. Exchange rate: June 30, 2005 Ps 2,324.22 = US$ 1 Average exchange rate June 2005 Ps 2,346.27 = US$ 1 - -------------------------------------------------------------------------------- CONTACTS Sergio Restrepo Jaime A. Velasquez Mauricio Botero Executive VP Financial VP IR Manager Tel.: (574) 3120332 Tel.: (574) 5108666 Tel.: (574) 5108866 1 [BANCOLOMBIA LOGO] - -------------------------------------------------------------------------------- 2Q05 1. HIGHLIGHTS: - Net income increased 33.0% over the quarter and 45.7% over the year, amounting to Ps 169.9 billion, or US$ 0.507 per ADS, compared to a net income of Ps 127.7 billion, or US$ 0.375 per ADS, for the previous quarter and Ps 116.6 billion, or US$ 0.300 per ADS, during the second quarter of 2004. - As of June 30, 2005 BANCOLOMBIA's net loans totaled Ps 10,656 billion, increasing 4.9% as compared to Ps 10,159 billion in the previous quarter. On a year-to-year basis, this represents an increase of 26.1% from Ps 8,454 billion at June 30, 2004. On the other hand, investment debt securities amounted to Ps 5,364 billion, increasing 6.8% over the quarter and 6.4% over the year. - During the second quarter of 2005, the net interest income amounted to Ps 356.7 billion, increasing 21.1% compared to the previous quarter and 50.6% on a year-to-year basis, due mainly to the recovery of bond prices which made interest on investments rise 42.4% and 117.5%, respectively, but also to interest on loans which increased 4.5% and 19.2%, respectively. - Net fees and income from services were up 9.5% over the quarter, reaching a total of Ps 127.1 billion, which represents an increase of 16.3% compared to the second quarter of 2004. - BANCOLOMBIA's ratio of past due loans to total loans at June 30, 2005 was 1.66% and the ratio of allowances for past due loans was 255%. - Pro-forma post-merger financial statements are attached at the end of the press release. Further information is available in BANCOLOMBIA's web site www.bancolombia.com under investor relations.
STOCK INDICATORS QUARTERS AS OF ------------------------------------------- ------------------- 2Q 04 1Q 05 2Q 05 JUN-04 JUN-05 ----------- ----------- ----------- ------- ------- Net Income (Ps millions) 116.583 127.724 169.881 240.631 297.605 USD Earnings per ADS 0,300 0,375 0,507 0,620 0,888 ROAA 3,17% 3,07% 3,91% 3,27% 3,42% ROAE 28,57% 26,85% 33,78% 29,48% 29,59% P/BV ADS(1) 1,50 2,30 2,40 P/BV Local(2)(3) 1,54 2,36 2,43 P/E(4) 5,65 9,07 7,97 Shares Outstanding 576.695.395 576.695.395 576.695.395
(1) Defined as ADS price divided by ADS book value. (2) Defined as Share price divided by share book value. (3) Share prices on the Colombian Stock Exchange (4) Defined as market capitalization divided by annualized quarter results CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS This release contains statements that may be considered forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934. All forward-looking statements, whether made in this release or in future filings or press releases or orally, address matters that involve risks and uncertainties; consequently, there are or will be factors, including, among others, changes in general economic and business conditions, changes in currency exchange rates and interest rates, introduction of competing products by other companies, lack of acceptances of new products or services by our targeted customers, changes in business strategy and various others factors, that could cause actual results to differ materially from those indicated in such statements. We do not intend, and do not assume any obligation, to update these forward-looking statements. 2 [BANCOLOMBIA LOGO] - -------------------------------------------------------------------------------- 2Q05 2. CONSOLIDATED BALANCE SHEET 2.1 ASSETS BANCOLOMBIA's total assets increased 2.77% over the quarter to Ps 18,723 billion as of June 30, 2005 from Ps 18.218 billion as of March 31, 2005, registering a 16,2% increase over the year from Ps 16,107 billion as of June 30, 2004. The increase in total assets is explained mainly by a larger loan portfolio. 2.1.1 LOAN PORTFOLIO Corporate loans maintained their positive trend, increasing 2,6% over the quarter from Ps 5,748 billion to Ps 5,898 billion, which represents an increase of 16.9% compared to Ps 5,047 billions as of June 30, 2004.
LOAN PORTFOLIO AS OF GROWTH (Ps millions) 30-JUN-04 31-MAR-05 30-JUN-05 2Q 05/1Q 05 2Q 05/2Q 04 --------- ---------- ---------- ----------- ----------- CORPORATE Working capital loans 4.402.620 4.605.565 4.702.575 2,11% 6,81% Loans funded by domestic development banks 380.353 754.871 763.909 1,20% 100,84% Trade Financing 190.854 293.966 320.487 9,02% 67,92% Overdrafts 53.223 69.267 87.614 26,49% 64,62% Credit Cards 19.985 24.625 23.832 -3,22% 19,25% TOTAL CORPORATE 5.047.035 5.748.294 5.898.417 2,61% 16,87% RETAIL AND SMES Working capital loans 1.088.583 1.353.731 1.473.914 8,88% 35,40% Personal loans 915.725 1.145.540 1.202.893 5,01% 31,36% Loans funded by domestic development banks 345.007 360.343 368.252 2,19% 6,74% Credit Cards 336.063 376.067 397.393 5,67% 18,25% Overdrafts 118.696 130.062 137.450 5,68% 15,80% Automobile loans 293.799 421.232 475.603 12,91% 61,88% Trade Financing 26.283 60.668 69.530 14,61% 164,54% TOTAL RETAIL AND SMES 3.124.156 3.847.643 4.125.035 7,21% 32,04% MORTGAGE 51.291 56.758 58.324 2,76% 13,71% FINANCIAL LEASES(1) 670.546 949.275 1.040.760 9,64% 55,21% TOTAL LOANS AND FINANCIAL LEASES 8.893.028 10.601.970 11.122.536 4,91% 25,07% ALLOWANCE FOR LOAN LOSSES AND FINANCIAL LEASES (1) (439.466) (442.831) (466.653) 5,38% 6,19% TOTAL LOANS AND FINANCIAL LEASES, NET 8.453.562 10.159.139 10.655.883 4,89% 26,05%
- ---------- (1) These items include financial leases contracts for comparison reasons The retail and small and medium-sized enterprise ("SME") loan portfolio also maintained robust growth rates. It totaled Ps 4,125 billion as of June 30, 2005, increasing 7.2% over the quarter and 32.0% over the year. Furthermore, financial leases for both corporate and SME clients increased 9.6% over the quarter and 55.2% over the year. All types of loans showed very positive trends in a year-to-year basis. 3 [BANCOLOMBIA LOGO] - -------------------------------------------------------------------------------- 2Q05 2.1.2 INVESTMENT PORTFOLIO BANCOLOMBIA's investments debt securities amounted to Ps 5,364 billion, increasing 6.8% as compared to Ps 5,024 billion from the previous quarter. On a year-to-year basis, this represents an increase of only 6.4%, from Ps 5,039 billion at June 30, 2004. 2.1.3 ASSET QUALITY As of June 30, 2005, the Bank's past due loans accounted for 1.66% of total loans. Loans classified as C, D and E accounted for 4.3% of total loans. Furthermore, the ratio of allowances for past due loans at the end of the quarter stayed at a conservative level of 255%. LOANS AND FINANCIAL LEASES CLASSIFICATION
AS OF 30-JUN-04 AS OF 31-MAR-05 AS OF 30-JUN-05 --------------- --------------- --------------- ( Ps millions) "A" Normal 8.097.116 91,1% 9.877.011 93,2% 10.294.476 92,6% "B" Subnormal 391.174 4,4% 334.330 3,2% 349.882 3,1% "C" Deficient 99.457 1,1% 97.658 0,9% 141.570 1,3% "D" Doubtful recovery 207.537 2,3% 205.593 1,9% 237.610 2,1% "E" Unrecoverable 97.744 1,1% 87.378 0,8% 98.998 0,9% TOTAL 8.893.028 100% 10.601.970 100% 11.122.536 100% LOANS AND FINANCIAL LEASES CLASSIFIED AS C, D AND E AS A PERCENTAGE OF TOTAL LOANS AND FINANCIAL LEASES 4,6% 3,7% 4,3%
ASSET QUALITY AS OF GROWTH ( Ps millions) 30-JUN-04 31-MAR-05 30-JUN-05 2Q 05/1Q 05 2Q 05/2Q 04 - -------------- --------- --------- --------- ----------- ----------- Total performing past due loans 65.182 78.651 81.504 3,63% 25,04% Total non-performing past due loans (1) 96.018 96.987 103.245 6,45% 7,53% Total past due loans 161.200 175.638 184.749 5,19% 14,61% Allowance for loans and accrued interest losses 444.952 447.400 470.687 5,20% 5,78% Past due loans to total loans 1,81% 1,66% 1,66% Non-performing loans to total loans 1,08% 0,91% 0,93% C, D, and E loans to total loans 4,55% 3,68% 4,30% Allowances to past due loans (2) 276,02% 254,73% 254,77% Allowances to C, D, and E loans (2) 109,94% 114,53% 98,43% Allowances to non-performing loans (2) 463,40% 461,30% 455,89% Allowances to total loans 5,00% 4,22% 4,23% Performing loans to total loans 98,92% 99,09% 99,07%
- ---------- (1) Non-performing loans comprise consumer loans that are past due 60 days or more, commercial loans that are past due 90 days or more, and mortgage loans that are past due 120 days or more. (2) Allowance means allowance for loan and accrued interest losses. 2.2 LIABILITIES Total deposits decreased 2.9% over the quarter, but increased 11.2% over the year to Ps 11,765 billion as of June 30, 2005. The funding mix was stable over the year. Interest-bearing deposits increased 10.7%, while non-interest bearing deposits increased 12.9%. 4 [BANCOLOMBIA LOGO] - -------------------------------------------------------------------------------- 2Q05 2.3 SHAREHOLDERS' EQUITY BANCOLOMBIA's shareholders' equity totaled Ps 2,237 billion at the end of the second quarter of 2005. This represents an increase of 12.8% over the quarter and 29.7% over the year. Unrealized gains on available for sale debt securities totaled Ps 114.5 billion as of June 30, 2005, which represents increases of 167.8% compared to the previous quarter and 161.9% compared to the same period of 2004. At the end of the second quarter, the Bank's consolidated ratio of technical capital to risk-weighted assets was 13.7%.
TECHNICAL CAPITAL RISK WEIGHTED ASSETS AS OF Consolidated (Ps millions) 30-JUN-04 31-MAR-05 30-JUN-05 - -------------------------- --------- --------- --------- Basic capital (Tier I) 1.264.690 1.531.183 1.682.375 Additional capital (Tier II) 238.358 274.906 308.543 Technical capital (1) 1.503.048 1.806.089 1.990.918 Risk weighted assets included market risk 11.991.482 13.799.147 14.544.531 CAPITAL ADEQUACY (2) 12,53% 13,09% 13,69%
- ---------- (1) Technical capital is the sum of basic capital and additional capital. (2) Capital Adequacy is Technical capital divided by Risk weighted assets 5 [BANCOLOMBIA LOGO] - -------------------------------------------------------------------------------- 2Q05 3. INCOME STATEMENT BANCOLOMBIA's net income amounted to Ps 169.9 billion for the quarter ended June 30, 2005, as compared to net income of Ps 127.7 billion for the previous quarter and Ps 116.6 billion for the second quarter of 2004. This represents robust increases of 33.0% and 45.7%, respectively. 3.1 NET INTEREST INCOME Net interest income totaled Ps 356.7 billion during the second quarter of 2005, increasing 21.1% compared to Ps 294.6 billion for the previous quarter and 50.6% compared to Ps 236.9 billion for the second quarter of 2004. It is important to notice that when compared to the second quarter of 2004, the interest income increased 41.2%, while the interest expense increased 25.3%. The increase in interest income was strongly impacted positively by the regional debt market recovery without underestimating the positive behavior of the interest on loans as well as on financial leases. 3.2 PROVISIONS Provisions for loan and interest losses amounted to Ps 40.5 billion, increasing 25.6% as compared to the previous quarter, while total net provisions amounted to Ps 27.4 billion, increasing 4.8% over the quarter. Recoveries of previously charged-off loans and foreclosed assets stayed strong. 3.3 FEES AND INCOME FROM SERVICES The different sources of fee generation continued their positive trend. Net fees and income from services increased to Ps 127.1 billion during the second quarter of 2005. This represents an increase of 9.5% as compared to Ps 116.1 billion for the previous quarter and an increase of 16.3% as compared to Ps 109.2 billion for the second quarter of 2004.
ACUMMULATED CREDIT CARD BILLING % 2005 (MillIon pesos as of June 30, 2005) 2004 2005 Growth Market Share - ----------------------------------- ---- ---- ------ ------------ Bancolombia VISA 238,201 300,553 26,18% 5,38% Bancolombia Mastercard 421,342 470,961 11,78% 8,44% Bancolombia American Express 172,957 239,210 38,31% 4,28% TOTAL BANCOLOMBIA 832,501 1.010,724 21,41% 18,10% --------- --------- ----- ----- Colombian credit card market 4.446,039 5.583,171 25,58%
Source: Credibanco, American Express y Red Multicolor
CREDIT CARD MARKET SHARE % 2005 Outstanding credit cards as of June 30,2005 2004 2005 Growth Market Share - ------------------------------------------- ---- ---- ------ ------------ Bancolombia VISA 106.943 137.274 28,36% 4,49% Bancolombia Mastercard 165.225 177.741 7,58% 5,82% Bancolombia American Express 68.493 96.617 41,06% 3,16% TOTAL BANCOLOMBIA 340.661 411.632 20,83% 13,47% --------- --------- ----- ----- Colombian credit card market 2.525.673 3.056.154 21,00%
Source: Credibanco, American Express y Red Multicolor. 6 [BANCOLOMBIA LOGO] - -------------------------------------------------------------------------------- 2Q05 BANCOLOMBIA's accumulated unconsolidated credit card billing increased 21.4% during the second quarter of 2005, resulting in an 18.1% market share of the Colombian credit card business. In addition, the Bank's number of outstanding credit cards increased 20.8%, resulting in a 13.5% market share. BC American Express credit card showed excellent performance, increasing its billing to Ps 239.2 billion and the number of outstanding credit cards to 96,617 cards, as of June 30, 2005, reaching a market share of 4.3% of total billing and 3.2% of outstanding credit cards. 3.4 OPERATING EXPENSES Total operating expenses increased 2.7% during the second quarter of 2005, amounting to Ps 251.4 billion. Nonetheless, due to the increase in net interest income discussed in section 3.1, BANCOLOMBIA's efficiency ratio dropped to 50.5% during the quarter.
PRINCIPAL RATIOS QUARTERS AS OF 2Q 04 1Q 05 2Q 05 JUN-04 JUN-05 PROFITABILITY Net interest margin (1) 7,36% 8,06% 9,29% 8,65% 8,49% Return on average total assets (2) 3,17% 3,07% 3,91% 3,27% 3,42% Return on average shareholders' equity (3) 28,57% 26,85% 33,78% 29,48% 29,59% EFFICIENCY Operating expenses to net operating income (4) 59,76% 53,92% 50,48% 53,36% 52,11% Operating expenses to average total assets (4) 6,16% 6,10% 6,09% 6,18% 5,96% CAPITAL ADEQUACY Shareholders' equity to total assets 10,71% 10,88% 11,95% 10,71% 11,95% Technical capital to risk weighted assets 12,53% 13,09% 13,69% 12,53% 13,69%
- ---------- (1) Defined as Net Interest Income divided by monthly average interest-earning assets. (2) Net income divided by monthly average total assets. (3) Net income divided by monthly average shareholders' equity. (4) Operating income includes net interest income, total fees and income from services, and total other operating income. The efficiency ratios contained herein are not comparable to those previously released by BANCOLOMBIA because merger expenses have been included as operating expenses. 7 [BANCOLOMBIA LOGO] - -------------------------------------------------------------------------------- 2Q05 4. SUBSIDIARIES BANCOLOMBIA PANAMA AND ITS SUBSIDIARIES The following table is expressed in US dollars.
BANCOLOMBIA PANAMA AND ITS SUBSIDIARIES BALANCE SHEET AND INCOME STATEMENT QUARTER GROWTH (US$) 2Q 04 1Q 05 2Q 05 2Q 05/1Q 05 2Q 05/2Q 04 ------------- ------------- ------------- ------------- ------------- ASSETS Loans and financial leases, net 521.118.663 526.841.306 534.249.551 1,41% 2,52% Investment securities, net 508.776.132 372.797.891 394.997.540 5,95% -22,36% Overnight funds sold 109.401.486 258.850.700 210.871.221 -18,54% 92,75% Other assets 41.388.857 49.768.563 63.556.517 27,70% 53,56% TOTAL ASSETS 1.180.685.138 1.208.258.460 1.203.674.829 -0,38% 1,95% LIABILITIES AND SHAREHOLDERS' EQUITY Deposits 1.022.790.639 1.020.806.955 959.678.271 -5,99% -6,17% Other liabilities 5.733.688 5.233.240 48.346.202 823,83% 743,20% TOTAL LIABILITIES 1.028.524.327 1.026.040.195 1.008.024.473 -1,76% -1,99% Shareholders' equity 152.160.811 182.218.265 195.650.356 7,37% 28,58% TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 1.180.685.138 1.208.258.460 1.203.674.829 -0,38% 1,95% Interest income 16.528.605 13.362.278 17.459.346 30,66% 5,63% Interest expense (4.263.276) (5.892.404) (6.204.917) 5,30% 45,54% NET INTEREST INCOME 12.265.329 7.469.874 11.254.429 50,66% -8,24% Net provisions (99.229) (1.404.904) (1.318.776) -6,13% 1229,02% Other operating income 297.755 1.538.268 1.351.951 -12,11% 354,05% Other operating expense (533.777) (1.484.540) (1.422.337) -4,19% 166,47% NET INCOME 11.930.078 6.118.698 9.865.267 61,23% -17,31%
Total assets were very stable amounting to US$1,204 million as of June 30, 2005. Additionally, shareholders' equity increased 7.4% over the quarter, from US$182 million as of March 31, 2005 to US$196 million as of June 30, 2005. BANCOLOMBIA Panama reported net income of US$9.9 million during the second quarter, increasing 61.2% compared to the previous quarter. This increase is explained by the recovery on bond prices mentioned above. 8 [BANCOLOMBIA LOGO] - -------------------------------------------------------------------------------- 2Q05
CONSOLIDATED BALANCE SHEET GROWTH (Ps millions) JUN-04 MAR-05 JUN-05 2Q 05/1Q 05 2Q 05/2Q 04 ---------- ---------- ---------- ---------- ---------- ASSETS Cash and due from banks 639.644 852.551 732.639 -14,07% 14,54% Overnight funds sold 423.373 525.528 311.420 -40,74% -26,44% TOTAL CASH AND EQUIVALENTS 1.063.017 1.378.079 1.044.059 -24,24% -1,78% ---------- ---------- ---------- ---------- ---------- DEBT SECURITIES 5.039.124 5.023.808 5.363.761 6,77% 6,44% Trading 2.111.136 2.295.496 2.156.776 -6,04% 2,16% Available for Sale 2.268.043 2.006.927 2.521.179 25,62% 11,16% Held to Maturity 659.945 721.385 685.806 -4,93% 3,92% EQUITY SECURITIES 283.288 355.450 302.665 -14,85% 6,84% Trading 43.159 83.950 26.189 -68,80% -39,32% Available for Sale 240.129 271.500 276.476 1,83% 15,14% Market value allowance (83.524) (65.486) (64.585) -1,38% -22,67% NET INVESTMENT SECURITIES 5.238.888 5.313.772 5.601.841 5,42% 6,93% ---------- ---------- ---------- ---------- ---------- Commercial loans 6.679.410 7.812.253 8.131.479 4,09% 21,74% Consumer loans 1.404.989 1.692.363 1.796.030 6,13% 27,83% Small business loans 84.628 91.321 95.943 5,06% 13,37% Mortgage loans 51.291 56.758 58.324 2,76% 13,71% Finance lease 672.710 949.275 1.040.760 9,64% 54,71% Allowance for loans and financial leases losses (439.466) (442.831) (466.653) 5,38% 6,19% NET TOTAL LOANS AND FINANCIAL LEASES 8.453.562 10.159.139 10.655.883 4,89% 26,05% ---------- ---------- ---------- ---------- ---------- Accrued interest receivable on loans 104.869 114.720 128.841 12,31% 22,86% Allowance for accrued interest losses (5.486) (4.569) (4.034) -11,71% -26,47% NET TOTAL INTEREST ACCRUED 99.383 110.151 124.807 13,31% 25,58% ---------- ---------- ---------- ---------- ---------- Customers' acceptances and derivatives 67.102 18.020 50.480 180,13% -24,77% Net accounts receivable 162.264 190.403 204.532 7,42% 26,05% Net premises and equipment 371.661 348.801 376.263 7,87% 1,24% Foreclosed assets 30.961 12.779 10.362 -18,91% -66,53% Prepaid expenses and deferred charges 18.336 17.414 12.217 -29,84% -33,37% Good will 87.905 67.945 62.264 -8,36% -29,17% Operating lease, net 9.965 7.826 7.104 -9,23% -28,71% Other 237.437 331.942 293.715 -11,52% 23,70% Reappraisal of assets 266.883 261.871 279.698 6,81% 4,80% ---------- ---------- ---------- ---------- ---------- TOTAL ASSETS 16.107.364 18.218.142 18.723.225 2,77% 16,24% ---------- ---------- ---------- ---------- ---------- LIABILITIES AND SHAREHOLDERS' EQUITY LIABILITIES DEPOSITS NON-INTEREST BEARING 2.110.170 2.387.663 2.381.533 -0,26% 12,86% Checking accounts 1.924.749 2.232.125 2.226.941 -0,23% 15,70% Other 185.421 155.538 154.592 -0,61% -16,63% ---------- ---------- ---------- ---------- ---------- INTEREST BEARING 8.473.812 9.724.041 9.383.163 -3,51% 10,73% Checking accounts 1.221.367 937.442 1.043.645 11,33% -14,55% Time deposits 4.118.498 4.671.305 4.548.281 -2,63% 10,44% Savings deposits 3.133.947 4.115.294 3.791.237 -7,87% 20,97% ---------- ---------- ---------- ---------- ---------- TOTAL DEPOSITS 10.583.982 12.111.704 11.764.696 -2,87% 11,16% Overnight funds 1.097.369 509.366 1.123.770 120,62% 2,41% Bank acceptances outstanding 48.632 49.894 41.664 -16,49% -14,33% Interbank borrowings 253.365 669.331 817.794 22,18% 222,77% Borrowings from domestic development banks 762.680 848.751 858.736 1,18% 12,59% Accounts payable 567.274 908.101 645.319 -28,94% 13,76% Accrued interest payable 93.581 111.027 113.883 2,57% 21,69% Other liabilities 158.719 214.765 238.781 11,18% 50,44% Bonds 522.896 569.718 562.449 -1,28% 7,56% Accrued expenses 253.172 198.932 274.722 38,10% 8,51% Minority interest in consolidated subsidiaries 40.999 43.559 44.224 1,53% 7,87% ---------- ---------- ---------- ---------- ---------- TOTAL LIABILITIES 14.382.669 16.235.148 16.486.038 1,55% 14,62% ---------- ---------- ---------- ---------- ---------- SHAREHOLDER'S EQUITY SUBSCRIBED AND PAID IN CAPITAL 288.348 288.348 288.348 0,00% 0,00% Non Voting Preference Shares 89.218 89.218 89.218 0,00% 0,00% Common Shares 199.130 199.130 199.130 0,00% 0,00% ---------- ---------- ---------- ---------- ---------- RETAINED EARNINGS 1.103.423 1.331.838 1.491.310 11,97% 35,15% Appropiated 862.792 1.204.114 1.193.705 -0,86% 38,35% Unappropiated 240.631 127.724 297.605 133,01% 23,68% ---------- ---------- ---------- ---------- ---------- REAPPRAISAL AND OTHERS 289.192 320.036 342.998 7,17% 18,61% GROSS UNREALIZED GAIN OR LOSS ON DEBT SECURITIES 43.732 42.772 114.531 167,77% 161,89% ---------- ---------- ---------- ---------- ---------- TOTAL SHAREHOLDER'S EQUITY 1.724.695 1.982.994 2.237.187 12,82% 29,71% ---------- ---------- ---------- ---------- ----------
9 [BANCOLOMBIA LOGO] - -------------------------------------------------------------------------------- 2Q05
AS OF QUARTER GROWTH ------------------------------ ------------------------------ -------------------- CONSOLIDATED INCOME STATEMENT JUN-05/ 2Q 05/ 2Q 05/ (Ps Millions) JUN-04 JUN-05 JUN-04 2Q 04 1Q 05 2Q 05 1Q 05 2Q 04 -------- -------- -------- -------- -------- -------- -------- -------- INTEREST INCOME AND EXPENSES Interest on loans 534,442 645,389 20.76% 276,572 315,622 329,767 4.48% 19.23% Interest on investment securities 242,742 269,816 11.15% 72,877 111,312 158,504 42.40% 117.50% Overnight funds 7,753 14,197 83.12% 4,139 5,580 8,617 54.43% 108.19% Leasing 42,074 65,747 56.27% 22,295 31,860 33,887 6.36% 51.99% TOTAL INTEREST INCOME 827,011 995,149 20.33% 375,883 464,374 530,775 14.30% 41.21% -------- -------- -------- -------- -------- -------- -------- -------- Interest expense Checking accounts 6,238 9,008 44.41% 3,075 4,614 4,394 -4.77% 42.89% Time deposits 125,267 150,866 20.44% 62,815 74,675 76,191 2.03% 21.29% Savings deposits 67,743 87,966 29.85% 37,679 42,654 45,312 6.23% 20.26% TOTAL INTEREST ON DEPOSITS 199,248 247,840 24.39% 103,569 121,943 125,897 3.24% 21.56% -------- -------- -------- -------- -------- -------- -------- -------- Interbank borrowings 2,402 12,188 407.41% 900 6,643 5,545 -16.53% 516.11% Borrowings from domestic development banks 35,646 40,293 13.04% 17,870 20,490 19,803 -3.35% 10.82% Overnight funds 15,666 17,495 11.67% 5,644 7,373 10,122 37.28% 79.34% Bonds 17,287 26,114 51.06% 11,021 13,359 12,755 -4.52% 15.73% TOTAL INTEREST EXPENSE 270,249 343,930 27.26% 139,004 169,808 174,122 2.54% 25.26% -------- -------- -------- -------- -------- -------- -------- -------- NET INTEREST INCOME 556,762 651,219 16.97% 236,879 294,566 356,653 21.08% 50.56% Provision for loan and accrued interest losses, net (44,399) (72,701) 63.74% (23,668) (32,228) (40,473) 25.58% 71.00% Recovery of charged-off loans 14,069 20,489 45.63% 7,836 6,800 13,689 101.31% 74.69% Provision for foreclosed assets and other assets (18,893) (9,000) -52.36% 2,527 (1,890) (7,110) 276.19% -381.36% Recovery of provisions for foreclosed assets and other assets 10,659 7,689 -27.86% 9,545 1,187 6,502 447.77% -31.88% -------- -------- -------- -------- -------- -------- -------- -------- TOTAL NET PROVISIONS (38,564) (53,523) 38.79% (3,760) (26,131) (27,392) 4.83% 628.51% NET INTEREST INCOME AFTER PROVISION FOR LOANS AND ACCRUED INTEREST LOSSES 518,198 597,696 15.34% 233,119 268,435 329,261 22.66% 41.24% -------- -------- -------- -------- -------- -------- -------- -------- Commissions from banking services and other services 33,003 40,622 23.08% 18,609 20,981 19,641 -6.38% 5.55% Electronic services and ATM's fees 28,432 34,194 20.27% 14,625 17,046 17,148 0.60% 17.25% Branch network services 18,105 20,690 14.28% 9,416 9,749 10,941 12.23% 16.20% Collections and payments fees 17,629 22,334 26.69% 8,257 10,660 11,674 9.51% 41.38% Credit card merchant fees 36,309 42,460 16.94% 18,695 19,599 22,861 16.64% 22.28% Credit and debit card annual fees 33,229 39,425 18.65% 16,982 18,867 20,558 8.96% 21.06% Checking fees 24,100 25,653 6.44% 12,081 12,370 13,283 7.38% 9.95% Warehouse services 23,102 27,634 19.62% 11,789 14,749 12,885 -12.64% 9.30% Fiduciary activities 25,826 27,945 8.20% 13,072 13,495 14,450 7.08% 10.54% Check remittance 5,561 4,998 -10.12% 2,728 2,426 2,572 6.02% -5.72% International operations 9,690 11,184 15.42% 4,520 5,122 6,062 18.35% 34.12% FEES AND OTHER SERVICE INCOME 254,986 297,139 16.53% 130,774 145,064 152,075 4.83% 16.29% -------- -------- -------- -------- -------- -------- -------- -------- Fees and other service expenses (45,078) (53,940) 19.66% (21,529) (28,958) (24,982) -13.73% 16.04% TOTAL FEES AND INCOME FROM SERVICES, NET 209,908 243,199 15.86% 109,245 116,106 127,093 9.46% 16.34% -------- -------- -------- -------- -------- -------- -------- -------- OTHER OPERATING INCOME Net foreign exchange gains (47,896) (59,033) 23.25% 10,830 (17,177) (41,856) 143.67% -486.48% Forward contracts in foreign currency 75,698 88,872 17.40% 3,255 30,890 57,982 87.70% 1681.32% Dividend income 15,909 29,611 86.13% 991 28,302 1,309 -95.37% 32.09% Revenues from commercial subsidiaries 38,929 35,165 -9.67% 16,848 14,763 20,402 38.20% 21.09% Communication, postage, rent and others 1,612 5,285 227.95% 1,015 2,610 2,675 2.47% 163.54% TOTAL OTHER OPERATING INCOME 84,252 99,900 18.57% 32,939 59,388 40,512 -31.78% 22.99% -------- -------- -------- -------- -------- -------- -------- -------- TOTAL INCOME 812,358 940,795 15.81% 375,303 443,929 496,866 11.92% 32.39% OPERATING EXPENSES Salaries and employee benefits 174,709 201,294 15.22% 88,328 99,434 101,860 2.44% 15.32% Bonus plan payments 14,374 8,235 -42.71% 5,109 6,197 2,038 -67.11% -60.11% Compensation 9,543 4,500 -52.85% 4,678 2,083 2,417 16.03% -48.33% Administrative and other expenses 210,560 239,561 13.77% 109,217 116,736 122,825 5.22% 12.46% Deposit security, net 6,222 16,831 170.51% 2,455 7,667 9,164 19.53% 273.28% Donation expenses 93 94 1.08% 45 43 51 18.60% 13.33% Depreciation 21,334 25,796 20.91% 11,046 12,738 13,058 2.51% 18.21% TOTAL OPERATING EXPENSES 436,835 496,311 13.62% 220,878 244,898 251,413 2.66% 13.82% -------- -------- -------- -------- -------- -------- -------- -------- NET OPERATING INCOME 375,523 444,484 18.36% 154,425 199,031 245,453 23.32% 58.95% Merger expenses -- 10,498 100.00% -- 2,905 7,593 161.38% 100.00% Goodwill amortization Banco de Colombia 11,324 11,324 0.00% 5,662 5,662 5,662 0.00% 0.00% NON-OPERATING INCOME (EXPENSE) Other income 22,912 24,143 5.37% 13,671 7,006 17,137 144.60% 25.35% Minority interest (1,592) (1,915) 20.29% (1,404) (999) (916) -8.31% -34.76% Other expense (31,858) (19,874) -37.62% (7,520) (5,063) (14,811) 192.53% 96.95% TOTAL NON-OPERATING INCOME (10,538) 2,354 -122.34% 4,747 944 1,410 49.36% -70.30% INCOME BEFORE INCOME TAXES 353,661 425,016 20.18% 153,510 191,408 233,608 22.05% 52.18% Income tax expense (113,030) (127,411) 12.72% (36,927) (63,684) (63,727) 0.07% 72.58% -------- -------- -------- -------- -------- -------- -------- -------- NET INCOME 240,631 297,605 23.68% 116,583 127,724 169,881 33.01% 45.72% -------- -------- -------- -------- -------- -------- -------- --------
10 [BANCOLOMBIA LOGO] - -------------------------------------------------------------------------------- 2Q05 5. PRO-FORMA FINANCIAL STATEMENTS(2)
AS OF JUNE 30, 2005 PRINCIPAL RATIOS BANCOLOMBIA BANCOLOMBIA PRE-MERGER POST-MERGER(1) ---------- -------------- PROFITABILITY Net interest margin 8.49% 7.38% Return on total assets 3.42% 2.95% Return on shareholders' equity 29.59% 28.55% EFFICIENCY Operating expenses to net operating income 52.11% 57.56% Operating expenses to average total assets 5.96% 5.89% CAPITAL ADEQUACY Shareholders' equity to total assets 11.95% 10.33% Technical capital to risk weighted assets 13.69% 11.12%
---------- (1) Calculated with figures as of June 30, 2005, not with averages like the Pre-Merger ratios
AS OF JUNE 30, 2005 ------------------- TECHNICAL CAPITAL RISK WEIGHTED ASSETS BANCOLOMBIA BANCOLOMBIA MERGER (Ps millions) PRE-MERGER POST-MERGER EFFECT % - ------------- ---------- ----------- ------ Basic capital (Tier I) 1.682.375 1.955.867 16,26% Additional capital (Tier II) 308.543 513.214 66,33% Technical capital (1) 1.990.918 2.469.081 24,02% Risk weighted assets included market risk 14.544.531 22.203.580 52,66% CAPITAL ADEQUACY (2) 13,69% 11,12% -2,57%
---------- (1) Technical capital is the sum of basic capital and additional capital. (2) Capital Adequacy is Technical capital divided by Risk weighted assets - ---------- (2) The unaudited pro forma combined condensed financial statements presented below are derived from the consolidated unaudited financial statements of Bancolombia, Corporacion Financiera Nacional y Suramericana S.A. ("Corfinsura") and Conavi Banco Comercial y de Ahorros S.A ("Conavi"), as of June 30, 2005, adjusted to give effect to the acquisition of Corfinsura and Conavi by Bancolombia, realized through the merger of the three entities, as if the merger had been completed as of June 30, 2005. The pro forma amounts have been developed from (a) the unaudited consolidated financial results of Bancolombia, included in this report, (b) the unaudited consolidated financial results of Corfinsura, giving effect to the spin-off of the portion of Corfinsura's assets and liabilities that will not be assumed by Bancolombia through the merger, as of June 30, 2005 and (c) the unaudited consolidated financial results of Conavi, as of June 30, 2005. These financial statements have been prepared in accordance with generally accepted accounting principles in Colombia, are stated in nominal terms and have not been audited. There can be no assurance that the Superintendency of Banking will not modify the accounting characterization for some of these items, in accordance with generally accepted accounting principles in Colombia. The unaudited pro forma combined condensed financial statements are provided for illustrative purposes only and do not purport to represent what the actual consolidated results of operations or the consolidated financial position of Bancolombia would have been, nor are they necessarily indicative of future consolidated results of operations or consolidated financial position. The unaudited pro forma combined condensed financial statements do not include the realization of cost savings from operating efficiencies, revenue synergies or other restructuring costs currently expected to result from the merger. No assurance can be given that any such savings or other expected benefits of the merger will in fact take place, whether at the level of management's current expectations or at all. 11 [BANCOLOMBIA LOGO] - -------------------------------------------------------------------------------- 2Q05
AS OF JUNE 30, 2005 ------------------- LOANS AND FINANCIAL LEASES CLASSIFICATION BANCOLOMBIA BANCOLOMBIA MERGER ( Ps millions) PRE-MERGER POST-MERGER EFFECT % - -------------- ---------- ----------- ------ "A" Normal 10.294.476 92,6% 16.255.410 92,6% 57,9% "B" Subnormal 349.882 3,1% 628.849 3,6% 79,7% "C" Deficient 141.570 1,3% 209.101 1,2% 47,7% "D" Doubtful recovery 237.610 2,1% 284.589 1,6% 19,8% "E" Unrecoverable 98.998 0,9% 174.451 1,0% 76,2% TOTAL 11.122.536 100% 17.552.400 100% 57,8% LOANS AND FINANCIAL LEASES CLASSIFIED AS C, D AND E AS A PERCENTAGE OF TOTAL LOANS AND FINANCIAL LEASES 4,3% 3,8%
AS OF JUNE 30, 2005 ------------------- ASSET QUALITY BANCOLOMBIA BANCOLOMBIA MERGER ( Ps millions) PRE-MERGER POST-MERGER EFFECT % - -------------- ---------- ----------- -------- Total performing past due loans 81.504 286.525 251,55% Total non-performing past due loans (1) 103.245 250.046 142,19% Total past due loans 184.749 536.571 190,43% Allowance for loans and accrued interest losses 470.687 705.552 49,90% Past due loans to total loans 1,66% 3,06% Non-performing loans to total loans 0,93% 1,42% C, D, and E loans to total loans 4,30% 3,81% Allowances to past due loans (2) 254,77% 131,49% Allowances to C, D, and E loans (2) 98,43% 105,60% Allowances to non-performing loans (2) 455,89% 282,17% Allowances to total loans 4,23% 4,02% Performing loans to total loans 99,07% 98,58%
- ---------- (1) Non-performing loans comprise consumer loans that are past due 60 days or more, commercial loans that are past due 90 days or more, and mortgage loans that are past due 120 days or more. (2) Allowance means allowance for loan and accrued interest losses. 12 [BANCOLOMBIA LOGO] - -------------------------------------------------------------------------------- 2Q05
AS OF JUNE 30, 2005 ---------------------------------------------------------- CONSOLIDATED BALANCE SHEET BANCOLOMBIA BANCOLOMBIA MERGER BANCOLOMBIA (Ps million and US Dollars millions) PRE-MERGER POST-MERGER EFFECT POST-MERGER % MILLIONS OF US$ - ------------------------------------ ----------- ----------- ----------- --------------- ASSETS Cash and due from banks 732,639 1,146,553 56.50% 493 Overnight funds sold 311,420 812,086 160.77% 350 TOTAL CASH AND EQUIVALENTS 1,044,059 1,958,639 87.60% 843 ----------- ----------- ----------- --------------- DEBT SECURITIES 5,363,761 7,400,501 37.97% 3,184 Trading 2,156,776 4,080,234 89.18% 1,756 Available for Sale 2,521,179 2,474,099 -1.87% 1,064 Held to Maturity 685,806 846,168 23.38% 364 EQUITY SECURITIES 302,665 213,193 -29.56% 92 Trading 26,189 31,678 20.96% 14 Available for Sale 276,476 181,515 -34.35% 78 Market value allowance (64,585) (64,532) -0.08% (28) NET INVESTMENT SECURITIES 5,601,841 7,549,162 34.76% 3,248 ----------- ----------- ----------- --------------- Commercial loans 8,131,479 11,441,432 40.71% 4,924 Consumer loans 1,796,030 2,125,157 18.33% 914 Small business loans 95,943 96,232 0.30% 41 Mortgage loans 58,324 1,455,408 2395.38% 626 Finance lease 1,040,760 2,434,171 133.88% 1,047 Allowance for loans and financial leases losses (466,653) (692,832) 48.47% (298) NET TOTAL LOANS AND FINANCIAL LEASES 10,655,883 16,859,568 58.22% 7,254 ----------- ----------- ----------- --------------- Accrued interest receivable on loans 128,841 198,598 54.14% 85 Allowance for accrued interest losses (4,034) (12,720) 215.32% (5) NET TOTAL INTEREST ACCRUED 124,807 185,878 48.93% 80 ----------- ----------- ----------- --------------- Customers' acceptances and derivatives 50,480 88,989 76.29% 38 Net accounts receivable 204,532 311,856 52.47% 134 Net premises and equipment 376,263 637,040 69.31% 274 Foreclosed assets 10,362 54,562 426.56% 23 Prepaid expenses and deferred charges 12,217 60,188 392.66% 26 Good will 62,264 62,264 0.00% 27 Operating lease, net 7,104 18,540 160.98% 8 Other 293,715 386,040 31.43% 166 Reappraisal of assets 279,698 396,574 41.79% 171 ----------- ----------- ----------- --------------- TOTAL ASSETS 18,723,225 28,569,300 52.59% 12,292 ----------- ----------- ----------- --------------- LIABILITIES AND SHAREHOLDERS' EQUITY LIABILITIES DEPOSITS NON-INTEREST BEARING 2,381,533 2,502,570 5.08% 1,077 Checking accounts 2,226,941 2,246,186 0.86% 966 Other 154,592 256,384 65.85% 111 ----------- ----------- ----------- --------------- INTEREST BEARING 9,383,163 14,696,705 56.63% 6,323 Checking accounts 1,043,645 1,056,500 1.23% 455 Time deposits 4,548,281 6,812,775 49.79% 2,931 Savings deposits 3,791,237 6,827,430 80.08% 2,937 ----------- ----------- ----------- --------------- TOTAL DEPOSITS 11,764,696 17,199,275 46.19% 7,400 Overnight funds 1,123,770 1,534,014 36.51% 660 Bank acceptances outstanding 41,664 41,949 0.68% 18 Interbank borrowings 817,794 1,274,645 55.86% 548 Borrowings from domestic development banks 858,736 1,809,234 110.69% 778 Accounts payable 645,319 875,924 35.74% 377 Accrued interest payable 113,883 188,319 65.36% 81 Other liabilities 238,781 304,678 27.60% 133 Bonds 562,449 1,992,489 254.25% 857 Accrued expenses 274,722 344,474 25.39% 148 Minority interest in consolidated subsidiaries 44,224 54,315 22.82% 23 ----------- ----------- ----------- --------------- TOTAL LIABILITIES 16,486,038 25,619,316 55.40% 11,023 ----------- ----------- ----------- --------------- SHAREHOLDER'S EQUITY SUBSCRIBED AND PAID IN CAPITAL 288,348 363,604 26.10% 156 ----------- ----------- ----------- --------------- RETAINED EARNINGS 1,491,310 1,847,229 23.87% 795 Appropiated 1,193,705 1,426,165 19.47% 614 Unappropiated 297,605 421,064 41.48% 181 ----------- ----------- ----------- --------------- REAPPRAISAL AND OTHER 342,998 624,606 82.10% 269 GROSS UNREALIZED GAIN OR LOSS ON DEBT SECURITIES 114,531 114,545 0.01% 49 ----------- ----------- ----------- --------------- TOTAL SHAREHOLDER'S EQUITY 2,237,187 2,949,984 31.86% 1,269
13 [BANCOLOMBIA LOGO] - -------------------------------------------------------------------------------- 2Q05
ACCUMULATED JUNE 30, 2005 ---------------------------------------------------------- CONSOLIDATED INCOME STATEMENT BANCOLOMBIA BANCOLOMBIA MERGER BANCOLOMBIA (Ps million and US Dollars millions) PRE-MERGER POST-MERGER EFFECT POST-MERGER % MILLIONS OF US$ - ------------------------------------ ----------- ----------- ----------- --------------- INTEREST INCOME AND EXPENSES Interest on loans 645,389 987,243 52.97% 425 Interest on investment securities 269,816 382,112 41.62% 164 Overnight funds and other 14,197 15,643 10.19% 7 Leasing 65,747 136,089 106.99% 59 TOTAL INTEREST INCOME 995,149 1,521,087 52.85% 655 ----------- ----------- ----------- --------------- Interest expense Checking accounts 9,008 9,090 0.91% 4 Time deposits 150,866 230,657 52.89% 99 Savings deposits 87,966 118,381 34.58% 51 TOTAL INTEREST ON DEPOSITS 247,840 358,128 44.50% 154 ----------- ----------- ----------- --------------- Interbank borrowings 12,188 20,693 69.78% 9 Borrowings from domestic development banks 40,293 78,523 94.88% 34 Overnight funds 17,495 40,236 129.99% 17 Bonds 26,114 80,739 209.18% 35 TOTAL INTEREST EXPENSE 343,930 578,319 68.15% 249 ----------- ----------- ----------- --------------- NET INTEREST INCOME 651,219 942,768 44.77% 406 Provision for loan and accrued interest losses, net (72,701) (77,385) 6.44% (33) Recovery of charged-off loans 20,489 31,306 52.79% 13 Provision for foreclosed assets and other assets (9,000) (28,674) 218.60% (12) Recovery of provisions for foreclosed assets and other assets 7,689 24,234 215.18% 10 ----------- ----------- ----------- --------------- TOTAL NET PROVISIONS (53,523) (50,519) -5.61% (22) NET INTEREST INCOME AFTER PROVISION FOR LOANS AND ACCRUED INTEREST LOSSES 597,696 892,249 49.28% 384 ----------- ----------- ----------- --------------- Commissions from banking services and other services 40,622 85,173 109.67% 36 Electronic services and ATM's fees 34,194 47,376 38.55% 20 Branch network services 20,690 22,811 10.25% 10 Collections and payments fees 22,334 27,043 21.09% 12 Credit card merchant fees 42,460 50,764 19.56% 22 Credit and debit card annual fees 39,425 103,924 163.60% 45 Checking fees 25,653 27,663 7.83% 12 Warehouse services 27,634 27,524 -0.40% 12 Fiduciary activities 27,945 28,827 3.16% 12 Check remittance 4,998 5,001 0.06% 2 International operations 11,184 13,325 19.15% 6 FEES AND OTHER SERVICE INCOME 297,139 439,431 47.89% 189 ----------- ----------- ----------- --------------- Fees and other service expenses (53,940) (77,887) 44.40% (34) TOTAL FEES AND INCOME FROM SERVICES, NET 243,199 361,544 48.66% 155 ----------- ----------- ----------- --------------- OTHER OPERATING INCOME Net foreign exchange gains (59,033) (61,094) 3.49% (26) Forward contracts in foreign currency 88,872 105,166 18.33% 45 Dividend income 29,611 39,364 32.94% 17 Revenues from commercial subsidiaries 35,165 65,746 86.96% 28 Communication, postage, rent and others 5,285 7,798 47.55% 4 TOTAL OTHER OPERATING INCOME 99,900 156,980 57.14% 68 ----------- ----------- ----------- --------------- TOTAL INCOME 940,795 1,410,773 49.96% 607 OPERATING EXPENSES Salaries and employee benefits 201,294 302,473 50.26% 130 Bonus plan payments 8,235 8,703 5.68% 4 Compensation 4,500 4,756 5.69% 2 Administrative and other expenses 239,561 425,747 77.72% 183 Deposit security, net 16,831 27,086 60.93% 12 Donation expenses 94 403 328.72% -- Depreciation 25,796 43,183 67.40% 19 TOTAL OPERATING EXPENSES 496,311 812,351 63.68% 350 ----------- ----------- ----------- --------------- NET OPERATING INCOME 444,484 598,422 34.63% 257 Merger expenses 10,498 17,381 65.56% 7 Goodwill amortization Banco de Colombia 11,324 11,324 0.00% 5 NON-OPERATING INCOME (EXPENSE) Other income 24,143 37,224 54.18% 16 Minority interest (1,915) (3,089) 61.31% (1) Other expense (19,874) (41,516) 108.90% (18) TOTAL NON-OPERATING INCOME 2,354 (7,381) -413.55% (3) INCOME BEFORE INCOME TAXES 425,016 562,336 32.31% 242 Income tax expense (127,411) (141,272) 10.88% (61) ----------- ----------- ----------- --------------- NET INCOME 297,605 421,064 41.48% 181
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