-----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, VCetHQBUXwta3XIQ9y18ULgfkVX7w3AT4o8W/ye+dQr9BsUhEKPXvqjIG0xoQ/Rf 2aUqLQu20BhA1cIy3er3TQ== 0000950127-06-000296.txt : 20060511 0000950127-06-000296.hdr.sgml : 20060511 20060511142028 ACCESSION NUMBER: 0000950127-06-000296 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20060510 FILED AS OF DATE: 20060511 DATE AS OF CHANGE: 20060511 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CORPBANCA/FI CENTRAL INDEX KEY: 0001276671 STANDARD INDUSTRIAL CLASSIFICATION: COMMERCIAL BANKS, NEC [6029] IRS NUMBER: 000000000 STATE OF INCORPORATION: F3 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 6-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-32305 FILM NUMBER: 06829426 BUSINESS ADDRESS: STREET 1: HUERFANOS 1072 CITY: SANTIAGO CHILE STATE: F3 ZIP: 00000 BUSINESS PHONE: 56 (2) 687-8000 MAIL ADDRESS: STREET 1: HUERFANOS 1072 CITY: SANTIAGO CHILE STATE: F3 ZIP: 00000 6-K 1 a6-k.txt REPORT OF FOREIGN PRIVATE ISSUER ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 6-K REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934 Date: May 11, 2006 Commission File Number: 001-32305 CORPBANCA ----------------------------------------------- (Translation of registrant's name into English) Huerfanos 1072, Santiago, Chile --------------------------------------- (Address of principal executive office) 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-________. ================================================================================ On May 5, 2006, Corpbanca announced unaudited consolidated financial results for the first quarter of 2006, ended March 31, 2006. A copy of the announcement is attached hereto as Exhibit 99.1. SIGNATURES 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. Date: May 11, 2006 CORPBANCA By: /s/ Claudio Chamorro Carrizo ------------------------------- Name: Claudio Chamorro Carrizo Title: Division Manager - Planning and Development Control EXHIBIT INDEX Exhibit Description - ------- ------------------------------------------------------------- 99.1 Corpbanca announcement, dated May 5, 2006, covering unaudited consolidated financial results for the first quarter of 2006, ended March 31, 2006. EX-99.1 2 ex99-1.txt PRESS RELEASE [LOGO OF CORP BANCA] CORP BANCA: FIRST QUARTER 2006 RESULTS Santiago, Chile, May 5, 2005 - CORP BANCA (NYSE: BCA), a Chilean financial institution offering a wide variety of corporate and retail financial products and services, today announced its financial results for the first quarter of 2006. This report is based on unaudited consolidated financial statements prepared in accordance with Chilean generally accepted accounting principles. Figures are expressed in Chilean pesos as of March 31, 2006 and percentages are expressed in real terms. Solely for the convenience of the reader, U.S. dollar amounts in this report have been translated from Chilean pesos at the rate of Ch$527.7 per U.S. dollar, the Central Bank of Chile's observed exchange rate as of March 31, 2006. CONSOLIDATED RESULTS FOR CORP BANCA FIRST QUARTER 2006 o ANALYSIS OF RESULTS CORP BANCA recorded net income of Ch$7,620 million for the first quarter of 2006. This represents a 31.8% decrease as compared to the same period in 2005, and is mainly due to a Ch$2,629 million decrease in gross margin, a Ch$1,088 million increase in operating expenses and a Ch$1,421 million decrease in net revenues from price-level restatement. In general, other key items remained relatively stable as compared to the first quarter of 2005. The following table shows certain information relating to the composition of our consolidated net income for the first quarter of 2005 and 2006, in millions of Chilean pesos (except percentages):
Change between Percentage change Three months ended Three months ended 2005 and 2006 between 2005 and March 31, 2005 March 31, 2006 periods 2006 periods ------------------- ------------------- --------------- ------------------ Gross margin 29,192 26,563 (2,629) (9.0)% Operating expenses (13,606) (14,694) (1,088) (8.0)% Provisions for loan losses (3,813) (3,762) 50 1.3% Income attributable to investments in other companies 63 85 22 34.8% Other non-operating expenses (430) (227) 202 47.1% Price-level restatement 2,605 1,184 (1,421) (54.5)% Net income before taxes 14,012 9,149 (4,863) (34.7)% Income tax provisions (2,836) (1,529) 1,308 46.1% Net income 11,176 7,620 (3,556) (31.8)%
Gross Margin. The following table shows certain information relating to the composition of CORP BANCA's gross margin for the first quarter of 2005 and 2006, in millions of Chilean pesos (except percentages):
Change between Percentage change Three months ended Three months ended 2005 and 2006 between 2005 and March 31, 2005 March 31, 2006 periods 2006 periods ------------------- ------------------- --------------- ------------------ Net interest revenue 21,906 22,037 132 0.6% Fees and income from services, net 4,442 6,218 1,776 40.0% Gains from trading activities, net 5,633 998 (4,635) (82.3)% Foreign exchange transactions, net (1,091) 91 1,183 108.4% Other operating income, net (1,698) (2,782) (1,084) (63.8)% Gross margin 29,192 26,563 (2,629) (9.0)% Net interest revenue, as adjusted (*) 21,235 21,514 279 1.3% Foreign Exchange rate earnings, as adjusted (*) (421) 615 1,035 246.2%
(*) Includes exchange rate earnings derived from forward contracts held by CORP BANCA for hedging purposes www.corpbanca.cl Huerfanos 1072, Santiago, Chile 1 Phone: 56 (2) 687 8000 [LOGO OF CORP BANCA] Our gross margin decreased by Ch$2,629 million, or 9.0%, in the first quarter of 2006 as compared to the first quarter of 2005. This decrease mainly reflects the Ch$4,635 million, or 82.3%, decrease in gains from trading activities, net. In prior periods, gains from trading activities, net, which reflects the results of trading in our investment portfolio, have provided us with an important source of cash flow. However, due to increases in the prevailing interest rates in Chile toward the end of 2005, our investment portfolio generated losses when marked to market, which were recorded as reserves in shareholders' equity. Subsequently, we voluntarily decided to gradually liquidate our investment portfolio, and, accordingly, recognize the aforementioned losses. Foreign exchange transactions, net increased by Ch$1,183 million, or 108.4%, in the first quarter of 2006 as compared to the same period in 2005, reflecting the effective management of our foreign currency-denominated asset and liability positions through forward contracts. Other operating income, net, decreased by Ch$1,084 million, or 63.8%, in the first quarter of 2006 as compared to the same period in 2005, due largely to a Ch$340 million increase in sales force expenses relating to the growth in our consumer loan and residential mortgage loan portfolios. Operating Expenses. The following table shows certain information relating to the composition of CORP BANCA's operating expenses for the first quarter of 2005 and 2006, in millions of Chilean pesos (except percentages):
Change between Percentage change Three months ended Three months ended 2005 and 2006 between 2005 and March 31, 2005 March 31, 2006 periods 2006 periods ------------------- ------------------- --------------- ------------------ Personnel salaries and expenses (8,718) (9,370) (653) -7.5% Administrative and other expenses (3,628) (4,064) (436) -12.0% Depreciation and amortization costs (1,260) (1,260) 0 0.0% Total operating expenses (13,606) (14,694) (1,088) -8.0%
Our operating expenses increased by Ch$1,088 million, or 8.0%, in the first quarter of 2006 compared to the first quarter of 2005. This increase was attributable to higher personnel salaries and expenses, which rose by Ch$653 million, or 7.5%, from Ch$8,718 million in the first quarter of 2005 to Ch$9,370 million in the first quarter of 2006, reflecting our hiring of additional personnel to handle increased business activity. In addition, administrative and other expenses increased by Ch$436 million, or 12.0%, in the same period due primarily to increased expenditures on marketing campaigns. These increased operating expenses had a negative impact on the efficiency ratio of the bank, which reached 55.3% as of March 31, 2006, as compared to 46.6% as of March 31, 2005. Price-level restatement. During the first quarter of 2006, we recorded net revenues from price-level restatement of Ch$1,184 million, representing a decrease of Ch$1,421 million, or 54.5%, as compared to net revenues from price-level restatement of Ch$2,605 million in the first quarter of 2005. This decrease reflects the negative inflation rate in Chile in the 2006 period as compared to higher inflation rates in the 2005 period. Other Indicators. CORP BANCA's annualized return on equity slid from 12.6% in the first quarter of 2005 to 7.9% in the first quarter of 2006 due to the negative impact of the liquidation of the majority of our investment portfolio and the increase in our equity base resulting from the capitalization of 50% of our 2005 net income. On a pre-tax basis, our return on equity in the first quarter of 2006 would have been 9.5%. www.corpbanca.cl Huerfanos 1072, Santiago, Chile 2 Phone: 56 (2) 687 8000 [LOGO OF CORP BANCA] Meanwhile, our net interest margin ratio (net interest revenue over interest-earning assets) remained relatively flat, falling from 2.8% as of March 31, 2005 to 2.7% as of March 31, 2006. o BUSINESS ACTIVITY Loan Portfolio. Our total loan portfolio (net of interbank loans) amounted to Ch$2,853,704 million as of March 31, 2006, representing 7.8% growth in real terms during the 12-month period then ended, which was lower than the 13.7% growth recorded by the Chilean banking sector for the same period. In addition, our loan portfolio market share in Chile decreased from 6.5% as of March 31, 2005 to 6.2% as of March 31, 2006. On the other hand, this decrease also reflects the results of our strategy of targeting loans to small- and medium-sized businesses. While loans in this sector tend to be for lower amounts than loans to larger corporations, they generate more favorable financial margins for us. The following table sets forth certain information with respect to CORP BANCA's loan portfolio, by loan type, as of the dates indicated, in millions of Chilean pesos (except percentages):
Percentage change As of March 31, As of March 31, Change from March from March 31, 2005 2005 2006 31, 2005 to 2006 to 2006 ------------------ ------------------ ----------------- ------------------- Commercial(*) 1,247,104 1,302,821 55,717 4.5% Consumer(*) 307,304 369,123 61,819 20.1% Foreign trade 233,750 222,925 (10,825) (4.6)% Residential mortgages 88,291 115,061 26,770 30.3% Commercial mortgages 198,157 191,617 (6,540) (3.3)% Other commercial mortgages 1,454 879 (576) (39.6)% Other Residential mortgages 101,901 123,427 21,525 21.1% Leasing contracts 186,565 214,173 27,608 14.8% Factored receivables 49,671 51,030 1,359 2.7% Contingent 206,495 239,578 33,083 16.0% Past due loans 25,730 22,833 (2,898) (11.3)% Other outstanding loans 482 238 (244) (50.6)% Total loans (excluding interbank loans) 2,646,907 2,853,704 206,797 7.8%
(*) Includes overdrafts The loan types that demonstrated the highest growth in relative terms were residential mortgage loans, with a 25.4% increase as of March 31, 2006 as compared to March 31, 2005, and consumer loans, with a 20.1% increase during the same period. The 25.4% increase in residential mortgages easily outpaced the 16.8% growth reported for this loan type in the Chilean banking sector for the same period. This growth allowed us to increase our residential mortgage market share in Chile from 2.3% as of March 31, 2005 to 2.5% as of March 31, 2006. Other Indicators. For the first quarter of 2006, we had a risk index (allowances for loan losses over total loans) of 1.5%, which compares favorably to the 1.7% risk index for the first quarter of 2005 and the 1.6% risk index for the Chilean banking sector in the first quarter of 2006. The improvement in the risk index was due mainly to changes in the composition of our loan portfolio, including a decrease in past due loans from 1.0% of total loans (net of interbank loans) in the first quarter of 2005 to 0.8% for the first quarter of 2006. Reported past due loans over total loans (net of interbank loans) for the Chilean banking sector were 0.9% for the first quarter of 2006. Our coverage ratio, measured as allowances for loan losses over past due loans, stayed flat at 196.1% as of March 31, 2006 when compared to March 31, 2005. We believe that this ratio indicates a healthy amount of coverage and it compares favorably to the 178.0% recorded by the Chilean banking sector as of the same date. www.corpbanca.cl Huerfanos 1072, Santiago, Chile 3 Phone: 56 (2) 687 8000 [LOGO OF CORP BANCA] o FINANCING The following table sets forth certain information with respect to CORPBANCA's sources of financing as of the dates indicated, in millions of Chilean pesos (except percentages):
Percentage Change from change from As of March 31, As of March 31, March 31, 2005 March 31, 2005 2005 2006 to 2006 to 2006 - ---------------------------------------- ------------------- ------------------- --------------- ------------------ Saving accounts and time deposits 1,823,102 1,519,918 (303,185) (16.6)% Current (checking) accounts 142,641 150,065 7,424 5.2% Banker's drafts and other sight deposits 146,699 57,150 (89,550) (61.0)% Mortgage bonds 284,554 285,887 1,333 0.5% Domestic borrowings 89,995 125,550 35,555 39.5% Foreign borrowings 236,006 215,622 (20,384) (8.6)% Funds in process of settlement 91,826 21,041 (70,785) (77.1)% Current (checking) accounts + other sight deposits(*) 197,515 186,174 (11,340) (5.7)%
(*) Net of funds in process of settlement Our domestic and other borrowings (saving accounts and time deposits, current (checking) accounts, banker's drafts and other sight deposits, mortgage bonds and domestic borrowings) decreased by Ch$348,421 million, or 14.0%, as of March 31, 2006 as compared to March 31,2005. This decrease was primarily due to a decrease of Ch$303,185 million, or 16.6%, in saving accounts and time deposits. Our foreign borrowings decreased by Ch$20,384 million, or 8.6%, reflecting the decrease in the value of the U.S. dollar as compared to the Chilean peso. Although these decreases have reduced the amount of available cash, the liquidation of the majority of investments in our treasury portfolio, described above, provided us with cash to finance a significant part of our growth and to service our liabilities. o SHAREHOLDERS' EQUITY The capitalization of 50% of our 2005 net income at the beginning of 2006, in the amount of Ch$26,316 million, enhanced our ability to cause our loan portfolio to grow and to maintain favorable solvency ratios. With capital and reserves of Ch$384,861 million as of March 31, 2006, we ranked as the fourth largest private bank in Chile as of March 31, 2006 and had an equity market share in Chile of 7.8% as of that date. Our Basle Index for the first quarter of 2006 was 15.1% compared to 14.1% for the first quarter of 2005. www.corpbanca.cl Huerfanos 1072, Santiago, Chile 4 Phone: 56 (2) 687 8000 [LOGO OF CORP BANCA]
Change ------------------------------------- Three months ended Three months ended March 31, 2005 March 31, 2006 Ch$ millions % ------------------- ------------------- --------------- ------------------ OPERATING INCOME Net interest revenue 21,906 22,037 132 0.6% Gains from trading activities 5,633 998 (4,635) (82.3) Fees and income from services, net 4,442 6,218 1,776 40.0% Foreign exchange transactions, net (1,091) 91 1,183 108.4% Other operating income (loss), net (1,698) (2,782) (1,084) (63.8)% Gross margin 29,192 26,563 (2,629) (9.0)% Personnel salaries and expenses (8,718) (9,370) (653) (7.5)% Administrative and other expenses (3,628) (4,064) (436) (12.0)% Depreciation and amortization (1,260) (1,260) 0 0.0% Total operating expenses (13,606) (14,694) (1,088) (8.0)% Net operating income 15,586 11,869 (3,717) (23.8)% Provisions for loan losses (*) (3,813) (3,762) 50 1.3% Operating income 11,773 8,107 (3,667) (31.1)% OTHER INCOME AND EXPENSES Non-operating income 606 495 (110) (18.2)% Non-operating expenses (1,035) (722) 313 30.2% Income attributable to investments in other companies 63 85 22 34.8% Price level restatement 2,605 1,184 (1,421) (54.5)% Total other income and expenses 2,239 1,042 (1,197) (53.4)% Income before income taxes 14,012 9,149 (4,863) (34.7)% Income taxes (2,836) (1,529) 1,308 46.1% Income after income taxes 11,176 7,620 (3,556) (31.8)% Minority interest -- -- -- -- Net income 11,176 7,620 (3,556) (31.8)%
(*) Under new regulations effective since January 1, 2004 provisions for loan losses are stated net of recoveries of previously charged off loans www.corpbanca.cl Huerfanos 1072, Santiago, Chile 6 Phone: 56 (2) 687 8000 [LOGO OF CORP BANCA]
As of March 31, 2005 As of March 31, 2006 or for the three or for the three Selected Performance Ratios months then ended months then ended - ----------------------------------------------------------------- --------------------- --------------------- SOLVENCY INDICATORS Basle index 14.1% 15.1% Shareholders' equity/Total assets 10.2% 11.7% Shareholders' equity/Total liabilities 11.4% 13.2% CREDIT QUALITY RATIOS Risk index (1) 1.7% 1.5% Past due loans/Total loans 1.0% 0.8% Allowances/Total loans 1.7% 1.5% Allowances/Past due loans 172.6% 196.1% Provisions for loan losses/Total loans 0.6% 0.5% Provisions for loan losses/Gross margin 13.1% 14.2% Provisions for loan losses/Net income 34.1% 49.4% PROFITABILITY RATIOS Net interest revenue/Interest-earning assets (2) 2.7% 2.8% Net interest revenue, as adjusted (3)/Interest-earning assets (2) 2.8% 2.9% Gross margin/Total assets 3.4% 3.2% Gross margin/Interest-earning assets (2) 3.6% 3.4% Provisions and charge-off expenses/Total assets 0.4% 0.5% ROA(before taxes), over total assets 1.6% 1.1% ROA(before taxes), over interest-earning assets (2) 1.7% 1.2% ROE(before taxes) 15.8% 9.5% ROA, over total assets 1.3% 0.9% ROA, over interest-earning assets (2) 1.4% 1.0% ROE 12.6% 7.9% Earnings from subsidiaries/Investment in subsidiaries 14.3% 19.0% EFFICIENCY RATIOS Operating expenses/Total assets 1.6% 1.8% Operating expenses/Total loans 2.0% 2.0% Operating expenses/Gross margin 46.6% 55.3% EARNINGS Earnings per share before taxes (Chilean pesos per share) 0.25 0.16 Earnings per ADR before taxes (U.S. dollars per ADR) 2.11 1.53 Earnings per share (Chilean pesos per share) 0.20 0.13 Earnings per ADR (U.S. dollars per ADR) 1.68 1.27
(1) New risk index includes total loan loss allowances (2) Interest-earning assets: Total loans and financial investments (3) Includes exchange rate earnings from forward contracts www.corpbanca.cl Huerfanos 1072, Santiago, Chile 7 Phone: 56 (2) 687 8000 [LOGO OF CORP BANCA] Consolidated Balance Sheets (unaudited) (In millions of Chilean pesos as of March 31, 2006, except percentages)
Change ------------------------------------- Three months ended Three months ended March 31, 2005 March 31, 2006 Ch$ millions % ------------------- ------------------- --------------- ------------------ ASSETS Cash and due from banks 133,770 80,033 (53,737) (40.2)% Total Loans 2,646,803 2,853,704 206,901 7.8% Provisions (44,405) (44,777) (372) 0.8% Loans, net 2,602,398 2,808,927 206,529 7.9% Loans to financial institutions 20,822 40,638 19,817 95.2% Securities trading 7,809 13,973 6,164 78.9% Investments 574,466 220,456 (354,010) (61.6)% Other assets 95,404 101,949 6,545 6.9% Fixed assets 34,295 33,886 (409) (1.2)% Total assets 3,468,963 3,299,863 (169,100) (4.9)% LIABILITIES Current (checking) accounts 142,641 150,065 7,424 5.2% Saving accounts and time deposits 2,525,941 2,166,249 (359,692) (14.2)% Subordinated bonds 48,789 191,704 142,915 292.9% Borrowings from domestic financial institutions 89,995 125,550 35,555 39.5% Foreign borrowings 236,006 215,622 (20,384) (8.6)% Other borrowings 60,106 58,191 (1,915) (3.2)% Total liabilities 3,103,478 2,907,382 (196,096) (6.3)% Shareholders' equity 365,486 392,481 26,996 7.4% Total liabilities and shareholders' equity 3,468,963 3,299,863 (169,100) (4.9)%
www.corpbanca.cl Huerfanos 1072, Santiago, Chile 8 Phone: 56 (2) 687 8000 [LOGO OF CORP BANCA] FORWARD-LOOKING INFORMATION Certain statements contained herein constitute forward-looking statements. Such statements are based on the point of view and the assumptions of management and involve known and unknown risks and uncertainties. Results may be materially different from those expressed or implied in such statements. Contacts - CORP BANCA: Claudio Chamorro C. Planning and Development Manager (56 - 2) 687-8114 claudio.chamorro@corpbanca.cl Raul Rubel B. Investor Relations (56 - 2) 687-6075 raul.rubel@corpbanca.cl www.corpbanca.cl Huerfanos 1072, Santiago, Chile 9 Phone: 56 (2) 687 8000 -----END PRIVACY-ENHANCED MESSAGE-----