Indicate by check mark whether the registrant
files or will file annual reports under cover Form 20-F or Form 40-F.
Indicate by check mark if the registrant
is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(1): ____
Indicate by check mark if the registrant
is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(7): ____
Indicate by check mark whether by furnishing
the information contained in this Form, the
registrant is also thereby furnishing the information to the Commission pursuant to Rule
12g3-2(b) under the Securities Exchange Act of 1934.
If “Yes” is marked, indicate below
the file number assigned to the registrant in
connection with Rule 12g3-2(b): 82- ________
Attached Banco de Chile’s Consolidated
Financial Statements with notes as of June 30, 2019.
BANCO DE CHILE AND SUBSIDIARIES
(Free translation of consolidated financial
statements originally issued in Spanish)
INDEX
|
I.
|
Interim Consolidated Statements of Financial Position
|
|
II.
|
Interim Consolidated Statements of Income
|
|
III.
|
Interim Consolidated Statements of Other Comprehensive
Income
|
|
IV.
|
Interim Consolidated Statements of Changes in Equity
|
|
V.
|
Interim Consolidated Statements of Cash Flows
|
|
VI.
|
Notes to the Interim Consolidated Financial Statements
|
MCh$
|
=
|
Millions of Chilean pesos
|
ThUS$
|
=
|
Thousands of U.S. dollars
|
UF or CLF
|
=
|
Unidad de Fomento
|
|
|
(The UF is an inflation-indexed, Chilean peso denominated monetary unit set daily in advance on the basis of the previous month’s inflation rate).
|
Ch$ or CLP
|
=
|
Chilean pesos
|
US$ or USD
|
=
|
U.S. dollar
|
JPY
|
=
|
Japanese yen
|
EUR
|
=
|
Euro
|
HKD
|
=
|
Hong Kong dollar
|
CHF
|
=
|
Swiss Franc
|
|
|
|
IFRS
|
=
|
International Financial Reporting Standards
|
IAS
|
=
|
International Accounting Standards
|
RAN
|
=
|
Compilation of Standards of the Chilean
|
|
|
Commission for the Financial Market (“CMF”)
|
IFRIC
|
=
|
International Financial Reporting Interpretations Committee
|
SIC
|
=
|
Standards Interpretation Committee
|
BANCO DE CHILE AND SUBSIDIARIES
INDEX
|
|
Page
|
Interim Consolidated Statement of Financial Position
|
1
|
Interim Consolidated Statements of Income
|
2
|
Interim Consolidated Statements of Other Comprehensive Income
|
3
|
Interim Consolidated Statement of Changes in Equity
|
4
|
Interim Consolidated Statements of Cash Flows
|
5
|
1.
|
Company information:
|
6
|
2.
|
Legal regulations, basis of preparation and other information:
|
7
|
3.
|
New Accounting Pronouncements:
|
10
|
4.
|
Changes in Accounting policies and Disclosures:
|
15
|
5.
|
Relevant Events:
|
16
|
5.
|
Relevant Events, continued:
|
18
|
6.
|
Business Segments:
|
21
|
7.
|
Cash and Cash Equivalents:
|
22
|
8.
|
Financial Assets Held-for-trading:
|
23
|
9.
|
Cash collateral on securities borrowed and reverse repurchase agreements:
|
25
|
10.
|
Derivative Instruments and
Accounting Hedges:
|
31
|
11.
|
Loans and advances to Banks:
|
32
|
12.
|
Loans to Customers, net:
|
38
|
13.
|
Investment Securities:
|
40
|
14.
|
Investments in Other Companies:
|
41
|
15.
|
Intangible Assets:
|
42
|
16.
|
Fixed assets, leased assets and lease liabilities:
|
44
|
17.
|
Current Taxes and Deferred Taxes:
|
48
|
18.
|
Other Assets:
|
49
|
19.
|
Current accounts and Other Demand Deposits:
|
52
|
20.
|
Savings accounts and Time Deposits:
|
53
|
21.
|
Borrowings from Financial Institutions:
|
53
|
22.
|
Debt Issued:
|
54
|
23.
|
Other Financial Obligations:
|
55
|
24.
|
Provisions:
|
58
|
25.
|
Other Liabilities:
|
58
|
26.
|
Contingencies and Commitments:
|
62
|
27.
|
Equity:
|
68
|
28.
|
Interest Revenue and Expenses:
|
71
|
29.
|
Income and Expenses from Fees and Commissions:
|
73
|
30.
|
Net Financial Operating Income:
|
74
|
31.
|
Foreign Exchange Transactions, Net:
|
74
|
32.
|
Provisions for Loan Losses:
|
75
|
33.
|
Personnel Expenses:
|
76
|
34.
|
Administrative Expenses:
|
77
|
35.
|
Depreciation, Amortization and Impairment:
|
78
|
36.
|
Other Operating Income:
|
79
|
37.
|
Other Operating Expenses:
|
80
|
38.
|
Related Party Transactions:
|
81
|
39.
|
Fair Value of Financial Assets and Liabilities:
|
86
|
40.
|
Maturity of Assets and Liabilities:
|
99
|
41.
|
Subsequent Events:
|
101
|
BANCO DE CHILE AND SUBSIDIARIES
INTERIM CONSOLIDATED
STATEMENTS OF FINANCIAL POSITION
For the periods ended June 30, 2019 and
December 31, 2018
(Free translation of interim consolidated
financial statements originally issued in Spanish)
(
Expressed
in million of Chilean pesos
)
|
|
|
|
June
|
|
|
December
|
|
|
|
|
|
2019
|
|
|
2018
|
|
|
|
Notes
|
|
MCh$
|
|
|
MCh$
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Cash and due from banks
|
|
7
|
|
|
1,150,682
|
|
|
|
880,081
|
|
Transactions in the course of collection
|
|
7
|
|
|
1,023,491
|
|
|
|
580,333
|
|
Financial assets held-for-trading
|
|
8
|
|
|
1,550,158
|
|
|
|
1,745,366
|
|
Cash collateral on securities borrowed and reverse repurchase agreements
|
|
9
|
|
|
93,982
|
|
|
|
97,289
|
|
Derivative instruments
|
|
10
|
|
|
1,435,764
|
|
|
|
1,513,947
|
|
Loans and advances to banks
|
|
11
|
|
|
1,191,846
|
|
|
|
1,494,307
|
|
Loans to customers, net
|
|
12
|
|
|
28,205,600
|
|
|
|
27,307,223
|
|
Financial assets available-for-sale
|
|
13
|
|
|
1,243,177
|
|
|
|
1,043,440
|
|
Financial assets held-to-maturity
|
|
13
|
|
|
—
|
|
|
|
—
|
|
Investments in other companies
|
|
14
|
|
|
47,694
|
|
|
|
44,561
|
|
Intangible assets
|
|
15
|
|
|
54,423
|
|
|
|
52,061
|
|
Property and equipment
|
|
16
|
|
|
218,525
|
|
|
|
215,872
|
|
Leased assets
|
|
16
|
|
|
156,671
|
|
|
|
—
|
|
Current tax assets
|
|
17
|
|
|
388
|
|
|
|
677
|
|
Deferred tax assets
|
|
17
|
|
|
319,922
|
|
|
|
277,922
|
|
Other assets
|
|
18
|
|
|
562,342
|
|
|
|
673,380
|
|
TOTAL ASSETS
|
|
|
|
|
37,254,665
|
|
|
|
35,926,459
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
|
|
|
|
|
Current accounts and other demand deposits
|
|
19
|
|
|
9,600,788
|
|
|
|
9,584,488
|
|
Transactions in the course of payment
|
|
7
|
|
|
727,547
|
|
|
|
335,575
|
|
Cash collateral on securities lent and repurchase agreements
|
|
9
|
|
|
261,120
|
|
|
|
303,820
|
|
Savings accounts and time deposits
|
|
20
|
|
|
10,798,909
|
|
|
|
10,656,174
|
|
Derivative instruments
|
|
10
|
|
|
1,572,621
|
|
|
|
1,528,357
|
|
Borrowings from financial institutions
|
|
21
|
|
|
1,596,655
|
|
|
|
1,516,759
|
|
Debt issued
|
|
22
|
|
|
7,863,807
|
|
|
|
7,475,552
|
|
Other financial obligations
|
|
23
|
|
|
171,284
|
|
|
|
118,014
|
|
Lease liabilities
|
|
16
|
|
|
155,373
|
|
|
|
—
|
|
Current tax liabilities
|
|
17
|
|
|
74,389
|
|
|
|
20,924
|
|
Deferred tax liabilities
|
|
17
|
|
|
—
|
|
|
|
—
|
|
Provisions
|
|
24
|
|
|
506,928
|
|
|
|
670,119
|
|
Other liabilities
|
|
25
|
|
|
532,593
|
|
|
|
412,524
|
|
TOTAL LIABILITIES
|
|
|
|
|
33,862,014
|
|
|
|
32,622,306
|
|
|
|
|
|
|
|
|
|
|
|
|
EQUITY
|
|
27
|
|
|
|
|
|
|
|
|
Attributable to Bank’s Owners:
|
|
|
|
|
|
|
|
|
|
|
Capital
|
|
|
|
|
2,418,833
|
|
|
|
2,418,833
|
|
Reserves
|
|
|
|
|
703,317
|
|
|
|
617,597
|
|
Other
comprehensive income
|
|
|
|
|
(44,824
|
)
|
|
|
(39,222
|
)
|
Retained
earnings:
|
|
|
|
|
|
|
|
|
|
|
Retained
earnings from previous years
|
|
|
|
|
170,171
|
|
|
|
17,481
|
|
Income
for the period
|
|
|
|
|
293,663
|
|
|
|
594,872
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
Provision
for minimum dividends
|
|
|
|
|
(148,510
|
)
|
|
|
(305,409
|
)
|
Subtotal
|
|
|
|
|
3,392,650
|
|
|
|
3,304,152
|
|
Non-controlling interests
|
|
|
|
|
1
|
|
|
|
1
|
|
TOTAL EQUITY
|
|
|
|
|
3,392,651
|
|
|
|
3,304,153
|
|
TOTAL LIABILITIES AND EQUITY
|
|
|
|
|
37,254,665
|
|
|
|
35,926,459
|
|
The accompanying notes 1 to 41 are an integral
part of these interim consolidated financial statements
BANCO DE CHILE AND SUBSIDIARIES
INTERIM CONSOLIDATED STATEMENTS OF INCOME
For the six-month ended June 30, 2019 and
2018
(Free translation of interim consolidated
financial statements originally issued in Spanish)
(
Expressed
in million of Chilean pesos
)
|
|
|
|
June
|
|
|
June
|
|
|
|
|
|
2019
|
|
|
2018
|
|
|
|
Notes
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
Interest revenue
|
|
28
|
|
|
1,031,683
|
|
|
|
965,831
|
|
Interest expense
|
|
28
|
|
|
(364,583
|
)
|
|
|
(318,301
|
)
|
Net interest income
|
|
|
|
|
667,100
|
|
|
|
647,530
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from fees and commissions
|
|
29
|
|
|
279,671
|
|
|
|
249,198
|
|
Expenses from fees and commissions
|
|
29
|
|
|
(64,027
|
)
|
|
|
(69,974
|
)
|
Net fees and commission income
|
|
|
|
|
215,644
|
|
|
|
179,224
|
|
|
|
|
|
|
|
|
|
|
|
|
Net financial operating income
|
|
30
|
|
|
43,431
|
|
|
|
52,141
|
|
Foreign exchange transactions, net
|
|
31
|
|
|
32,391
|
|
|
|
7,273
|
|
Other operating income
|
|
36
|
|
|
24,346
|
|
|
|
16,064
|
|
Total operating revenues
|
|
|
|
|
982,912
|
|
|
|
902,232
|
|
|
|
|
|
|
|
|
|
|
|
|
Provisions for loan losses
|
|
32
|
|
|
(157,115
|
)
|
|
|
(124,755
|
)
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING REVENUES, NET OF PROVISIONS FOR LOAN LOSSES
|
|
|
|
|
825,797
|
|
|
|
777,477
|
|
|
|
|
|
|
|
|
|
|
|
|
Personnel expenses
|
|
33
|
|
|
(228,927
|
)
|
|
|
(209,898
|
)
|
Administrative expenses
|
|
34
|
|
|
(166,323
|
)
|
|
|
(162,173
|
)
|
Depreciation and amortization
|
|
35
|
|
|
(34,665
|
)
|
|
|
(18,471
|
)
|
Impairment
|
|
35
|
|
|
(822
|
)
|
|
|
(11
|
)
|
Other operating expenses
|
|
37
|
|
|
(21,786
|
)
|
|
|
(25,326
|
)
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL OPERATING EXPENSES
|
|
|
|
|
(452,523
|
)
|
|
|
(415,879
|
)
|
|
|
|
|
|
|
|
|
|
|
|
NET OPERATING INCOME
|
|
|
|
|
373,274
|
|
|
|
361,598
|
|
|
|
|
|
|
|
|
|
|
|
|
Income attributable to associates
|
|
14
|
|
|
3,973
|
|
|
|
4,148
|
|
Income before income tax
|
|
|
|
|
377,247
|
|
|
|
365,746
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
|
|
17
|
|
|
(83,584
|
)
|
|
|
(60,532
|
)
|
|
|
|
|
|
|
|
|
|
|
|
NET INCOME FOR THE PERIOD
|
|
|
|
|
293,663
|
|
|
|
305,214
|
|
Attributable to:
|
|
|
|
|
|
|
|
|
|
|
Bank’s Owners
|
|
27
|
|
|
293,663
|
|
|
|
305,214
|
|
Non-controlling interests
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share attributable to Bank’s Owners:
|
|
|
|
Ch$
|
|
|
Ch$
|
|
Basic net income per share
|
|
27
|
|
|
2.91
|
|
|
|
3.02
|
|
Diluted net income per share
|
|
27
|
|
|
2.91
|
|
|
|
3.02
|
|
The accompanying notes 1 to 41 are an integral
part of these interim consolidated financial statements
BANCO DE CHILE AND SUBSIDIARIES
INTERIM CONSOLIDATED STATEMENTS OF
OTHER COMPREHENSIVE INCOME
For the six-month ended June 30, 2019 and
2018
(Free translation of interim consolidated
financial statements originally issued in Spanish)
(
Expressed
in million of Chilean pesos
)
|
|
|
|
June
|
|
|
June
|
|
|
|
|
|
2019
|
|
|
2018
|
|
|
|
Notes
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
NET INCOME FOR THE PERIOD
|
|
|
|
|
293,663
|
|
|
|
305,214
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER COMPREHENSIVE INCOME THAT WILL BE RECLASSIFIED SUBSEQUENTLY TO PROFIT OR LOSS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gains (losses) on available-for-sale instruments valuation
|
|
13
|
|
|
17,677
|
|
|
|
(6,182
|
)
|
Net gains (losses) on derivatives held as cash flow hedges
|
|
10
|
|
|
(25,344
|
)
|
|
|
(30,342
|
)
|
Subtotal Other comprehensive income before income taxes
|
|
|
|
|
(7,667
|
)
|
|
|
(36,524
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Income tax relating to the components of other comprehensive income that are reclassified in income for the period
|
|
|
|
|
2,065
|
|
|
|
9,859
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other comprehensive income items that will be reclassified subsequently to profit or loss
|
|
|
|
|
(5,602
|
)
|
|
|
(26,665
|
)
|
|
|
|
|
|
|
|
|
|
|
|
OTHER COMPREHENSIVE INCOME THAT WILL NOT BE RECLASSIFIED SUBSEQUENTLY TO PROFIT OR LOSS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustment for defined benefit plans
|
|
24
|
|
|
(186
|
)
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal other comprehensive income before income taxes
|
|
|
|
|
(186
|
)
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax relating to the components of other comprehensive income that will not be reclassified to income for the period
|
|
|
|
|
50
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other comprehensive income items that will not be reclassified subsequently to profit or loss
|
|
|
|
|
(136
|
)
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
CONSOLIDATED COMPREHENSIVE INCOME FOR THE PERIOD
|
|
|
|
|
287,925
|
|
|
|
278,549
|
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to:
|
|
|
|
|
|
|
|
|
|
|
Bank’s Owners
|
|
|
|
|
287,925
|
|
|
|
278,549
|
|
Non-controlling interests
|
|
|
|
|
—
|
|
|
|
—
|
|
The accompanying notes 1 to 41 are an integral
part of these interim consolidated financial statements
BANCO DE CHILE AND SUBSIDIARIES
INTERIM CONSOLIDATED STATEMENTS OF CHANGES
IN EQUITY
For the six-month ended June 30, 2019 and
2018
(Free translation of interim consolidated
financial statements originally issued in Spanish)
(
Expressed
in millions of Chilean pesos
)
|
|
|
|
|
|
|
Reserves
|
|
|
Other
comprehensive income
|
|
|
Retained
earnings
|
|
|
|
|
|
|
|
|
Paid-in
Capital
|
|
|
Other
reserves
|
|
|
Reserves
from earnings
|
|
|
Unrealized
gains (losses) on available-for-sale
|
|
|
Derivatives
cash flow hedge
|
|
|
Income
|
|
|
Retained
earnings from previous periods
|
|
|
Income
(losses) for the period
|
|
|
Provision
for minimum dividends
|
|
|
Attributable
to equity holders of the parent
|
|
|
Non-controlling
interest
|
|
|
Total
equity
|
|
|
|
Notes
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
Tax
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Balances
as of December 31, 2017
|
|
|
|
|
2,271,401
|
|
|
|
32,053
|
|
|
|
531,135
|
|
|
|
1,851
|
|
|
|
(12,551
|
)
|
|
|
2,660
|
|
|
|
16,060
|
|
|
|
576,012
|
|
|
|
(312,907
|
)
|
|
|
3,105,714
|
|
|
|
1
|
|
|
|
3,105,715
|
|
Capitalization
of retained earnings
|
|
|
|
|
147,432
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(147,432
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Retention
(release) of profits according to bylaws
|
|
27
|
|
|
—
|
|
|
|
—
|
|
|
|
54,501
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(54,501
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Dividends
distributions and paid
|
|
27
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(374,079
|
)
|
|
|
312,907
|
|
|
|
(61,172
|
)
|
|
|
—
|
|
|
|
(61,172
|
)
|
Other
comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivatives
cash flow hedge, net
|
|
27
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(30,342
|
)
|
|
|
8,192
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(22,150
|
)
|
|
|
—
|
|
|
|
(22,150
|
)
|
Valuation
adjustment on available-for-sale instruments (net)
|
|
27
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(6,182
|
)
|
|
|
—
|
|
|
|
1,667
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(4,515
|
)
|
|
|
—
|
|
|
|
(4,515
|
)
|
Income
for the period 2018
|
|
27
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
305,214
|
|
|
|
—
|
|
|
|
305,214
|
|
|
|
—
|
|
|
|
305,214
|
|
Provision
for minimum dividends
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(155,398
|
)
|
|
|
(155,398
|
)
|
|
|
—
|
|
|
|
(155,398
|
)
|
Balances
as of June 30, 2018
|
|
|
|
|
2,418,833
|
|
|
|
32,053
|
|
|
|
585,636
|
|
|
|
(4,331
|
)
|
|
|
(42,893
|
)
|
|
|
12,519
|
|
|
|
16,060
|
|
|
|
305,214
|
|
|
|
(155,398
|
)
|
|
|
3,167,693
|
|
|
|
1
|
|
|
|
3,167,694
|
|
Defined
benefit plans adjustment, net
|
|
|
|
|
—
|
|
|
|
(92
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(92
|
)
|
|
|
—
|
|
|
|
(92
|
)
|
Equity
effect change in accounting policy
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,421
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,421
|
|
|
|
—
|
|
|
|
1,421
|
|
Other
comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivatives
cash flow hedge, net
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(601
|
)
|
|
|
162
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(439
|
)
|
|
|
—
|
|
|
|
(439
|
)
|
Valuation
adjustment on available-for-sale instruments
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(5,605
|
)
|
|
|
—
|
|
|
|
1,527
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(4,078
|
)
|
|
|
—
|
|
|
|
(4,078
|
)
|
Income
for the period 2018
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
289,658
|
|
|
|
—
|
|
|
|
289,658
|
|
|
|
—
|
|
|
|
289,658
|
|
Provision
for minimum dividends
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(150,011
|
)
|
|
|
(150,011
|
)
|
|
|
—
|
|
|
|
(150,011
|
)
|
Balances
as of December 31, 2018
|
|
|
|
|
2,418,833
|
|
|
|
31,961
|
|
|
|
585,636
|
|
|
|
(9,936
|
)
|
|
|
(43,494
|
)
|
|
|
14,208
|
|
|
|
17,481
|
|
|
|
594,872
|
|
|
|
(305,409
|
)
|
|
|
3,304,152
|
|
|
|
1
|
|
|
|
3,304,153
|
|
Retention
of profits
|
|
|
|
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
152,705
|
|
|
|
(152,705
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Retention
(release) of profits according to bylaws
|
|
27
|
|
|
—
|
|
|
|
—
|
|
|
|
85,856
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(85,856
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Dividends
distributions and paid
|
|
27
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(356,311
|
)
|
|
|
305,409
|
|
|
|
(50,902
|
)
|
|
|
—
|
|
|
|
(50,902
|
)
|
Defined
benefit plans adjustment, net
|
|
|
|
|
—
|
|
|
|
(136
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(136
|
)
|
|
|
—
|
|
|
|
(136
|
)
|
Other
comprehensive income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivatives
cash flow hedge, net
|
|
27
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(25,344
|
)
|
|
|
6,843
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(18,501
|
)
|
|
|
—
|
|
|
|
(18,501
|
)
|
Valuation
adjustment on available-for-sale instruments
|
|
27
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
17,677
|
|
|
|
—
|
|
|
|
(4,778
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
12,899
|
|
|
|
—
|
|
|
|
12,899
|
|
Equity
effect change in accounting policy
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(15
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(15
|
)
|
|
|
—
|
|
|
|
(15
|
)
|
Income
for the period 2019
|
|
27
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
293,663
|
|
|
|
—
|
|
|
|
293,663
|
|
|
|
—
|
|
|
|
293,663
|
|
Provision
for minimum dividends
|
|
27
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(148,510
|
)
|
|
|
(148,510
|
)
|
|
|
—
|
|
|
|
(148,510
|
)
|
Balances
as of June 30, 2019
|
|
|
|
|
2,418,833
|
|
|
|
31,825
|
|
|
|
671,492
|
|
|
|
7,741
|
|
|
|
(68,838
|
)
|
|
|
16,273
|
|
|
|
170,171
|
|
|
|
293,663
|
|
|
|
(148,510
|
)
|
|
|
3,392,650
|
|
|
|
1
|
|
|
|
3,392,651
|
|
The accompanying notes 1 to 41 are an integral
part of these interim consolidated financial statements
BANCO DE CHILE AND SUBSIDIARIES
INTERIM CONSOLIDATED STATEMENTS OF CASH
FLOWS
For the six-month ended June 30, 2019 and
2018
(Free translation of interim consolidated
financial statements originally issued in Spanish)
(
Expressed
in million of Chilean pesos
)
|
|
|
|
June
|
|
|
June
|
|
|
|
|
|
2019
|
|
|
2018
|
|
|
|
Notes
|
|
MCh$
|
|
|
MCh$
|
|
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
Net income for the period
|
|
|
|
|
293,663
|
|
|
|
305,214
|
|
Charges (credits) to income that do not represent cash flows:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
35
|
|
|
34,665
|
|
|
|
18,471
|
|
Impairment
|
|
35
|
|
|
822
|
|
|
|
11
|
|
Provision for loans
and accounts receivable from customers and owed by banks
|
|
32
|
|
|
178,820
|
|
|
|
147,747
|
|
Provision of contingent loans
|
|
32
|
|
|
2,670
|
|
|
|
3,159
|
|
Fair value adjustment of financial assets
held-for-trading
|
|
|
|
|
(2,305
|
)
|
|
|
(1,039
|
)
|
Changes in assets and liabilities by deferred
taxes
|
|
17
|
|
|
(46,728
|
)
|
|
|
8,711
|
|
(Gain) loss attributable
to investments in companies with significant influence, net
|
|
14
|
|
|
(3,655
|
)
|
|
|
(3,816
|
)
|
(Gain) loss from sales of assets received
in lieu of payment,net
|
|
36
|
|
|
(6,358
|
)
|
|
|
(2,723
|
)
|
(Gain) loss on sales of property and equipment,
net
|
|
36
|
|
|
(43
|
)
|
|
|
(3,580
|
)
|
Charge-offs of assets received in lieu of
payment
|
|
37
|
|
|
3,769
|
|
|
|
1,842
|
|
Other charges (credits) to income that do
not represent cash flows
|
|
|
|
|
6,401
|
|
|
|
(1,297
|
)
|
Change in the exchange rate of assets and
liabilities
|
|
|
|
|
(3,817
|
)
|
|
|
(59,409
|
)
|
Net interest variation, readjustment and
accrued fees on assets and liabilities
|
|
|
|
|
(393
|
)
|
|
|
79,252
|
|
|
|
|
|
|
|
|
|
|
|
|
Changes in assets and liabilities that affect operating cash flows:
|
|
|
|
|
|
|
|
|
|
|
(Increase) decrease in loans and advances
to banks, net
|
|
|
|
|
302,522
|
|
|
|
(542,754
|
)
|
(Increase) decrease in loans to customers
|
|
|
|
|
(1,034,377
|
)
|
|
|
(1,186,313
|
)
|
(Increase) decrease in financial assets held-for-trading,
net
|
|
|
|
|
90,824
|
|
|
|
343,151
|
|
(Increase) decrease in other assets and liabilities
|
|
|
|
|
375,546
|
|
|
|
(114,419
|
)
|
Increase (decrease) in current account and
other demand deposits
|
|
|
|
|
15,215
|
|
|
|
374,646
|
|
Increase (decrease)
in payables from repurchase agreements and security lending
|
|
|
|
|
(30,948
|
)
|
|
|
108,121
|
|
Increase (decrease) in savings accounts and
time deposits
|
|
|
|
|
130,378
|
|
|
|
411,375
|
|
Sale of assets received
in lieu of payment or adjudicated
|
|
|
|
|
16,407
|
|
|
|
11,927
|
|
Total
cash flows from operating activities
|
|
|
|
|
323,078
|
|
|
|
(101,723
|
)
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
(Increase) decrease in financial assets available-for-sale,
net
|
|
|
|
|
(187,415
|
)
|
|
|
76,061
|
|
Payments for lease agreements
|
|
16
|
|
|
(14,332
|
)
|
|
|
—
|
|
Purchases of property and equipment
|
|
16
|
|
|
(18,621
|
)
|
|
|
(10,959
|
)
|
Sales of property and equipment
|
|
|
|
|
43
|
|
|
|
3,581
|
|
Acquisition of intangible assets
|
|
15
|
|
|
(8,469
|
)
|
|
|
(11,518
|
)
|
Dividends received
from investments in companies
|
|
|
|
|
871
|
|
|
|
743
|
|
Total
cash flows from investing activities
|
|
|
|
|
(227,923
|
)
|
|
|
57,908
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
Redemption of letters of credit
|
|
|
|
|
(1,714
|
)
|
|
|
(2,334
|
)
|
Issuance of bonds
|
|
22
|
|
|
867,072
|
|
|
|
888,585
|
|
Redemption of bonds
|
|
|
|
|
(514,893
|
)
|
|
|
(538,225
|
)
|
Dividends paid
|
|
27
|
|
|
(356,311
|
)
|
|
|
(374,079
|
)
|
Increase (decrease) in borrowings from foreign
financial institutions
|
|
|
|
|
78,486
|
|
|
|
(17,833
|
)
|
Increase (decrease) in other financial obligations
|
|
|
|
|
54,417
|
|
|
|
8,545
|
|
Increase (decrease) in other obligations
with Central Bank of Chile
|
|
|
|
|
—
|
|
|
|
(1
|
)
|
Other long-term borrowings
|
|
|
|
|
—
|
|
|
|
15
|
|
Payment of other long-term
borrowings
|
|
|
|
|
(908
|
)
|
|
|
(1,301
|
)
|
Total
cash flows from financing activities
|
|
|
|
|
126,149
|
|
|
|
(36,628
|
)
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL NET POSITIVE (NEGATIVE) CASH
FLOWS FOR THE PERIOD
|
|
|
|
|
221,304
|
|
|
|
(80,443
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes
|
|
|
|
|
3,817
|
|
|
|
59,409
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
at beginning of period
|
|
|
|
|
2,256,375
|
|
|
|
2,079,398
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
at end of period
|
|
7
|
|
|
2,481,496
|
|
|
|
2,058,364
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June
|
|
|
June
|
|
|
|
|
|
2019
|
|
|
2018
|
|
|
|
|
|
MCh$
|
|
|
MCh$
|
|
Operational Cash flow interest:
|
|
|
|
|
|
|
|
|
|
|
Interest received
|
|
|
|
|
978,878
|
|
|
|
915,615
|
|
Interest paid
|
|
|
|
|
(312,171
|
)
|
|
|
(188,833
|
)
|
The accompanying notes 1 to 41 are an integral
part of these interim consolidated financial statements
BANCO DE CHILE AND SUBSIDIARIES
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL
STATEMENTS
(Free translation of interim consolidated
financial statements originally issued in Spanish)
______________
Banco de Chile is authorized
to operate as a commercial bank since September 17, 1996, being, in conformity with the stipulations of article 25 of Law No. 19,396,
the legal continuation of Banco de Chile resulting from the merger of the Banco Nacional de Chile, Banco Agrícola and Banco
de Valparaiso, which was constituted by public deed dated October 28, 1893, granted before the Notary Public of Santiago, Mr. Eduardo
Reyes Lavalle, authorized by Supreme Decree of November 28, 1893.
Banco de Chile (or the “Bank”)
is a Corporation organized under the laws of the Republic of Chile, regulated by the Chilean Commission for the Financial Market
(“CMF”), in accordance with the established in the Law 21,130 dated January 12, 2019, which ordered the integration
of the Superintendency of Banks and Financial Institutions (“SBIF”) with the Commission for the Financial Market as
of June 1, 2019. Since 2001, it is subject to the supervision of the Securities and Exchange Commission of the United States of
America (“SEC”), in consideration of the fact that the Bank is registered on the New York Stock Exchange (“NYSE”),
through a program of American Depositary Receipt (“ADR”).
Banco de Chile offers a broad
range of banking services to its customers, ranging from individuals to large corporations. The services are managed in the areas
of corporations and large companies, medium and small companies and personal and consumer banking. Additionally, the Bank offers
international as well as treasury banking services, in addition to those offered by subsidiaries that include securities brokerage,
mutual fund and investment management, insurance brokerage, financial advisory services and securitization.
Banco de Chile’s legal address
is Ahumada 251, Santiago, Chile and its website is www.bancochile.cl.
The Interim Consolidated Financial
Statements of Banco de Chile, for the period ended June 30, 2019 were approved by the Directors on July 25, 2019.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
2.
|
Legal regulations, basis of preparation and other information:
|
The Law 21,000 that creates
the CMF, in its article 5, empowers it to issue accounting standards of general application for entities it supervises. The Corporations
Law, in turn, requires following the generally accepted accounting principles.
Based on the aforementioned
laws, banks should use the criteria provided by the Compendium of Accounting Standards (“Compendium”), and any matter
not addressed therein, as long as it does not contradict its instructions, should adhere to generally accepted accounting principles
in technical standards issued by the Chilean Association of Accountants, that coincide with international accounting standards
and international financial reporting standards agreed upon by the International Accounting Standards Board (“IASB”).
Should there be discrepancies between these generally accepted accounting principles and the accounting criteria issued by the
CMF, the latter shall prevail.
|
(b)
|
Basis of preparation:
|
|
(b.1)
|
These Interim Consolidated Financial Statements are
presented according to Chapter C-2 of the Compendium of Accounting Standards, issued by the Chilean Commission for the Financial
Market (CMF).
|
|
(b.2)
|
The following table details the entities in which the Bank has control and are part of this consolidated
financial statements:
|
|
|
|
|
|
|
|
|
Interest Owned
|
|
|
|
|
|
|
|
|
|
Direct
|
|
|
Indirect
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
|
|
|
|
|
Functional
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
RUT
|
|
Subsidiaries
|
|
Country
|
|
Currency
|
|
%
|
|
|
%
|
|
|
%
|
|
|
%
|
|
|
%
|
|
|
%
|
|
96,767,630-6
|
|
Banchile Administradora General de Fondos S.A.
|
|
Chile
|
|
Ch$
|
|
|
99.98
|
|
|
|
99.98
|
|
|
|
0.02
|
|
|
|
0.02
|
|
|
|
100.00
|
|
|
|
100.00
|
|
96,543,250-7
|
|
Banchile Asesoría Financiera S.A.
|
|
Chile
|
|
Ch$
|
|
|
99.96
|
|
|
|
99.96
|
|
|
|
—
|
|
|
|
—
|
|
|
|
99.96
|
|
|
|
99.96
|
|
77,191,070-K
|
|
Banchile Corredores de Seguros Ltda.
|
|
Chile
|
|
Ch$
|
|
|
99.83
|
|
|
|
99.83
|
|
|
|
0.17
|
|
|
|
0.17
|
|
|
|
100.00
|
|
|
|
100.00
|
|
96,571,220-8
|
|
Banchile Corredores de Bolsa S.A.
|
|
Chile
|
|
Ch$
|
|
|
99.70
|
|
|
|
99.70
|
|
|
|
0.30
|
|
|
|
0.30
|
|
|
|
100.00
|
|
|
|
100.00
|
|
96,932,010-K
|
|
Banchile Securitizadora S.A.
|
|
Chile
|
|
Ch$
|
|
|
99.01
|
|
|
|
99.01
|
|
|
|
0.99
|
|
|
|
0.99
|
|
|
|
100.00
|
|
|
|
100.00
|
|
96,645,790-2
|
|
Socofin S.A.
|
|
Chile
|
|
Ch$
|
|
|
99.00
|
|
|
|
99.00
|
|
|
|
1.00
|
|
|
|
1.00
|
|
|
|
100.00
|
|
|
|
100.00
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
2.
|
Legal regulations, basis of preparation and other information,
continued:
|
|
(c)
|
Use of estimates and judgments:
|
Preparing the Interim Consolidated
Financial Statements requires the Bank’s Management to make judgments, estimations and assumptions that affect the application
of accounting policies and the valuation of assets, liabilities, income and expenses presented. Actual results could differ from
these estimated amounts. These estimates refer to:
|
1.
|
Provision for loan losses (Notes No. 11. No. 12 and
No. 32);
|
|
2.
|
Useful life of intangible and property and equipment
(Notes No.15 and No.16);
|
|
3.
|
Income taxes and deferred taxes (Note No. 17);
|
|
4.
|
Provisions (Note No. 24);
|
|
5.
|
Contingencies and Commitments (Note No. 26);
|
|
6.
|
Fair value of financial assets and liabilities (Note
No. 39).
|
Estimates and relevant assumptions
are regularly reviewed by the management of the Bank, according to quantify certain assets, liabilities, gains, loss and commitments.
Estimates reviewed are registered in income in the period that the estimate is reviewed.
As of June 30, there have been
no significant changes in the estimates made.
|
(d)
|
Seasonality or Cyclical Character of the Transactions
of the Intermediate Period:
|
Given the activities to which
the Bank and its subsidiaries are engaged, the transactions of the Bank do not have a cyclical or seasonal nature. For this reason,
specific breakdowns in these notes to the Interim Consolidated Financial Statements for the six-month period ended June 30, 2019
are not included.
In determining the information
to be disclosed on the different items of the financial statements or other matters, the relative importance in relation to the
Financial Statements of the period has been taken into account.
The Bank acts as a lessor
Assets that are leased to clients
under contracts that substantially transfer all risks and property recognition, with or without legal title, are classified as
a financial lease. When the assets are subject to a financial leasing, the leased assets are no longer recognized as a fixed asset
and are recorded in an account receivable, which is equal to the minimum value of the lease payment, discounted at the interest
rate of the lease. The initial negotiation expenses in a financial lease are incorporated into the account receivable through the
discount rate applied to the lease. Lease income is recognized on lease terms based on a model that consistently reflects a periodic
rate of return on the net investment of the lease.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
2.
|
Legal regulations, basis of preparation and other information,
continued:
|
Assets that are leased to customers
under contracts that do not transfer substantially all the risks and benefits of the property are classified as an operating lease
and are recognized monthly on an accrual basis.
The leased investment properties,
under the operating lease modality, are included in “Other assets” in the Statement of Financial position and depreciation
is determined on the book value of these assets, applying a proportion of the value in a systematic way on the economic use of
the estimated useful life. Lease income is recognized on a straight-line basis over the lease period, on an accrual basis.
The Bank acts as a lessee
A contract is or contains a
lease if it has the right to control the use of an identified asset for a period of time in exchange for a consideration.
At the start date of a lease,
an asset is determined by right of use of the leased asset at cost, which comprises the amount of the initial measurement of the
lease liability plus other disbursements made, except lease payments in the short term and those in which the underlying asset
is of low value, which are recognized directly in results.
The amount of the lease liability
is measured at the present value of future lease payments that have not been paid on that date, which are discounted using the
Bank’s incremental financing interest.
The right-of-use asset is measured
using the cost model less accumulated depreciation and accumulated impairment losses. The depreciation of the right-of-use asset
is recognized in the Income Statement based on the straight-line method of depreciation from the start date and until the end of
the term of the lease.
After the start date, the lease
liability is measured by reducing the carrying amount to reflect the lease payments made and the lease contract modifications.
There
have not been significant reclassifications at the end of this period 2019.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
3.
|
New Accounting Pronouncements:
|
3.1 Standards approved and/or
modified by the International Accounting Standards Board (IASB) and by the Chilean Commission for the Financial Market (CMF):
3.1.1 Standards and interpretations
that have been adopted in these Consolidated Financial Statements.
As of the date of issuance
of these Interim Consolidated Financial Statements, the new accounting pronouncements issued by both the International Accounting
Standards Board and the CMF, which have been adopted by the Bank and its subsidiaries, are detailed below:
Accounting standards issued
by IASB.
IFRS 16 Leases.
On January 2016 was issued
IFRS 16, which has as purpose to establish principles to the recognition, measurement, presentation and disclosure of lease contracts
from the point of view of the lessee and lessor.
This new rule does not differ
significantly from IAS 17 Leases that precedes it, related to the accounting treatment for the lessor. However, related to the
lessee, the new rule requires the recognition of assets and liabilities for most lease contracts.
The Bank and its subsidiaries,
for purposes of the initial application of the standard, took the option to recognize the cumulative effect on the initial adoption
date (January 1, 2019), not expressing comparative information, recording an asset for right of use for an amount equal to the
lease liability for an amount of Ch$144,529 million. This amount was determined according to the present value of the remaining
lease payments, discounted using the Bank’s incremental financing interest rate.
IFRIC 23 Uncertainty over
Income Tax Treatments.
In June 2017, the IASB published
IFRIC 23, which clarifies the application of the recognition and measurement criteria required by IAS 12 Income Taxes when there
is uncertainty about tax treatments.
This modification had no impact
on the Banco de Chile and its subsidiaries.
IFRS 9 Financial instruments
and IAS 28 Investments in associates and joint ventures.
On October 2017, the IASB published
the amendments to IFRS 9 Financial Instruments and IAS 28 Investments in Associated Entities and Joint Ventures.
The amendments to IFRS 9 allow
entities to measure financial assets, prepaid with negative compensation at amortized cost or fair value, through other comprehensive
income if a specific condition is met, instead of at fair value with effect on results.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
3.
|
New Accounting Pronouncements, continued:
|
Regarding IAS 28, the amendments
clarify that entities must account for long-term results in an associate or joint venture, to which the equity method is not applied,
using IFRS 9.
The IASB also released an example
that illustrates how companies should apply the requirements of IFRS 9 and IAS 28 to long-term interests in an associated entity
or joint venture.
This modification had no impact
for Banco de Chile and its subsidiaries.
Annual improvements
to IFRS.
On December 2017, the IASB issued the Annual Improvements
to IFRS Cycle 2015-2017, which includes amendments to the following regulations:
- IFRS 3 Business Combinations. Interests
previously held in a joint operation.
The amendment provides additional
guidance for applying the procurement method to particular types of business combinations.
The amendment states that when
a party to a joint arrangement obtains control of a business, which is a joint arrangement and had rights over the assets and liabilities
for the liabilities related to this joint arrangement, immediately before the acquisition date, the transaction it is a business
combination achieved in stages.
Therefore, the acquirer will apply
the requirements for a business combination achieved in stages, including re-measuring its previously held interest in the joint
operation. By doing so, the acquirer will re-measure its total value that it previously had in the joint operation.
This modification had no impact
for Banco de Chile and its subsidiaries.
- IFRS 11 Joint Arrangements.
The amendment to IFRS 11 relate
to the accounting for acquisitions of interests in Joint Agreements.
The amendment establishes that
a party that participates, but does not have control, in a joint agreement, can obtain control of the joint agreement. Given the
above, the activity of the joint agreement would constitute a Business Combination as defined in IFRS 3, in such cases; the interests
previously held in the joint agreement are not remeasured.
This modification had no impact
for Banco de Chile and its subsidiaries.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
3.
|
New Accounting Pronouncements, continued:
|
- IAS 23 Costs for loans. Costs for loans that can
be capitalized.
The amendment to the standard
is intended to clarify that, when an asset is available for use or sale, an entity will treat any outstanding loan taken specifically
to obtain said asset, as part of the funds it has taken as current loans, from that moment on the interest will not be included
as part of the cost of the asset.
This modification had no impact
for Banco de Chile and its subsidiaries.
- IAS 19 Employee Benefits.
On February 2018 the IASB issued
amendments to IAS 19 “Employee Benefits”, which relate to:
- If there is a modification,
reduction or liquidation of a plan, it is now mandatory that the current service cost and net interest for the period after the
new measurement be determined using the assumptions used for the new measurement.
- In addition, amendments have
been included to clarify the effect of a modification, reduction or liquidation of a plan on the requirements with respect to the
asset roof
.
This modification had no impact
for Banco de Chile and its subsidiaries.
Accounting standards issued
by the CMF.
- Circular No. 3,645.
On January 31, 2019, the CMF
published this circular, which introduces changes to the Compendium of Accounting Standards in order to apply the criteria defined
in IFRS 16.
The main changes are for the
valuation for the right to use of assets under lease being applied as a measurement after initial recognition, the cost methodology
less accumulated depreciation / amortization and accumulated impairment.
In the statement of financial
position are introduced the items “Leased assets” and “lease liabilities”, which also modify the Notes
“Fixed assets” and “Leased assets and lease liabilities”.
Additionally, banks and their
subsidiaries must record any effect due to the first application of this standard in the equity item “Retained earnings from
previous periods”.
The application of these amendments
was made jointly with the adoption of IFRS 16 Leases.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
3.
|
New Accounting Pronouncements, continued:
|
3.1.2 New standards and
interpretations that have been issued but its date of application have not yet come into force:
The following is a summary
of new standards, interpretations and improvements to the International Financial Reporting Standards issued by the International
Accounting Standards Board and the CMF that are not yet effective as of June 30, 2019, are detailed below:
Accounting standards issued
by IASB.
IAS 28 Investments in Associates
and Join Venture and IFRS 10 - Consolidated Financial Statements.
In September 2014, the IASB
issued this amendment, which clarifies the scope of recognized gains and losses in a transaction involving an associate or joint
venture, and this depends on whether the asset sold or contribution is a business. Therefore, IASB concluded that all of the profit
or loss should be recognized against loss of control of a business. Likewise, gains or losses resulting from the sale or contribution
of a subsidiary that is not a business (definition of IFRS 3) to an associate or joint venture should be recognized only to the
extent of unrelated interests in the associate or joint venture.
During December 2015 the IASB
agreed that the amendments should apply in the future, allowing its immediate application.
This amendment will not impact
on the Interim Consolidated Financial Statements of Banco de Chile and its subsidiaries.
Conceptual Framework.
On March 29, 2018, the IASB issued
a “Reviewed” Conceptual Framework. Changes to the Conceptual Framework may affect the application of IFRS when no rule
applies to a particular transaction or event.
The Conceptual Framework introduces
mainly the following improvements:
|
-
|
It incorporates some new concepts of measurement,
presentation and disclosure and derecognition of assets and liabilities in the Financial Statements.
|
|
-
|
Provides updated definitions of assets, liabilities
and includes criteria for the recognition of assets and liabilities in the financial statements.
|
|
-
|
Clarifies some important concepts such as background
on form, prudential criteria and measurement of uncertainty.
|
The Conceptual Framework enters
into force for periods beginning on
January 1, 2020
. Early adoption is permitted.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
3.
|
New Accounting Pronouncements, continued:
|
- IFRS 3 Business Combinations. Definition of a
Business.
The amendments clarify the definition
of business, with the objective of helping entities determine whether a transaction should be accounted for as a business combination
or as the acquisition of an asset.
|
(a)
|
clarify that, to be considered a business, an acquired
set of activities and assets must include, as a minimum, an input and a substantive process that together contribute significantly
to the ability to produce outputs;
|
|
(b)
|
eliminate the assessment of whether market participants
can substitute missing processes or inputs and continue to produce outputs;
|
|
(c)
|
add guides and illustrative examples to help entities
assess whether a substantial process has been acquired;
|
|
(d)
|
restrict definitions of a business or products by focusing
on goods and services provided to clients and eliminate reference to the ability of reducing costs; and
|
|
(e)
|
add an optional concentration test that allows a simplified
assessment of whether an acquired set of activities and businesses acquired are not business.
|
Companies are required to apply
the modified definition of a business to acquisitions made from
January 1, 2020
. Early application is allowed.
This amendment has no impact on
the Interim Consolidated Financial Statements of Banco de Chile and its subsidiaries.
- IAS 1 Presentation of Financial Statements and
IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors. Definition of Materiality or relative importance.
The IASB issued changes to IAS
1, Presentation of Financial Statements, and IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors, to clarify
the definition of materiality and align these standards with the Revised Conceptual Framework issued in March 2018, to facilitate
companies to make materiality judgments.
Under the old definition omissions
or misrepresentations of elements are important if they could, individually or collectively, influence the economic decisions that
users make on the basis of financial statements (IAS 1 Presentation of Financial Statements).
The new definition states that
information is material if the omission, distortion or concealment of the information can reasonably be expected to influence decisions
that primary users of financial statements of general purpose make on the basis of those financial statements, which provide financial
information about a specific reporting entity.
The date of application of these
amendments is
January 1, 2020
. Early application is allowed.
This amendment has no impact on
the Interim Consolidated Financial Statements of Banco de Chile and its subsidiaries.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
3.
|
New Accounting Pronouncements, continued:
|
Accounting standards issued
by the CMF.
- Circular N°3,638.
On July 6, 2018, the CMF published
amendments to the standards contained in Chapter B-1 “Provisions for Credit Risk” of the Compendium of Accounting Standards,
which incorporates a standard model for the estimation of provisions for credit risk of the commercial portfolio of group analysis.
The proposed methods and risk factors considered are
the following:
|
-
|
Commercial Leasing Portfolio: considers default, the
type of asset in leasing (real estate or non-real estate) and the current value over value of the asset of the operation.
|
|
-
|
Student Portfolio: considers the type of loan granted,
the enforceability of the payment and the default that it presents, in case the loan is required.
|
|
-
|
Generic Commercial Portfolio: considers default and
the existence of real guarantees that guarantee the placement. In the case of guarantees, the relationship between the placement
and the value of the security right that covers it is considered.
|
According to the CMF, the three
standardized methods included in the model will constitute a prudential floor for internal methods currently used by the industry.
On January 31, 2019, the CMF supplemented
said instructions with the publication of Circular No. 3,647, with the purpose of recognizing the mitigating effect of the credit
risk represented by the assignor’s responsibility in the factoring operations, a particular factor is introduced for the
component “Loss Given Default” (hereinafter “LGD”) of the standard method for the commercial portfolio
of group analysis, for factoring provisions.
The new standards will come into
force in
July 2019.
The adoption of this standard
will not have material impacts on the Consolidated Financial Statements of Banco de Chile and its subsidiaries.
|
4.
|
Changes in Accounting policies and Disclosures:
|
The accounting policies adopted
in the preparation of this Consolidated Interim Financial Statements are consistent with those used in the preparation of the annual
Consolidated Financial Statements for the year ended December 31, 2018, except for the adoption of new regulations in force at
1 January 2019. See Note No. 3 “Recent Accounting Pronouncements”.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
(a)
|
On January 18, 2019, the subsidiary Banchile Corredores
de Bolsa S.A. informed that in the Ordinary Session held that day, the Board became aware and accepted the resignation presented
by Mr. Roberto Serwaczak Slowinski to his position as Director of the company.
|
|
(b)
|
On January 24, 2019 in the Ordinary Session No. BCH
2,895, the Board of Directors of Banco de Chile agreed to convene an Ordinary Meeting of Shareholders for March 28, 2019, with
the purpose of proposing, among other matters, the distribution of the dividend No. 207 of $ 3.52723589646 for each share, corresponding
to 70% of the distributable liquid profit, retaining the remaining 30%.
|
|
(c)
|
On January 28, 2019, Banco de Chile and its subsidiary
Banchile Corredores de Seguros Ltda. informed that they have entered into a strategic alliance with the insurance companies Chubb
Seguros Chile S.A. and Chubb Seguros de Vida Chile S.A. The framework of the strategic alliance establishes the general terms
and conditions pursuant to which the Bank will grant, for a period of 15 years, exclusive access to the Companies to provide insurances
to clients via face-to-face and digital channels of the Bank, through Banchile, subject to the exceptions agreed upon by the parties.
|
The aforementioned Agreement
includes a payment to the Bank of UF 5,367,057 on the date of the signing of the contracts, in accordance with the terms and conditions
thereof, and annual payments subject to compliance with insurance sales objectives during the agreement lifetime.
The subscription of the contracts
referred in the Agreement was subject to the condition that the National Economic Prosecutor’s Office approve the execution
of all of them, for which purpose the parties have proceeded to notify the operation in accordance with Chapter IV of the Decree
Law No. 211.
|
(d)
|
On March 14, 2019 in the Ordinary session No. 2,897,
the Board of Directors of Banco de Chile agreed to establish a provision for minimum dividends of 60% of the net distributable
profit that will be generated during the course of the year. For these purposes, the net distributable profit is defined as net
income for the corresponding period minus the value effect of the monetary unit of paid capital and reserves, as a result of any
change in the Consumer Price Index (CPI) between to the month prior to the current month and the month of November of the previous
year.
|
|
(e)
|
On March 28, 2019 at the Ordinary Shareholder’s
Meeting, our shareholders approved the distribution of the dividend No. 207 of $3.52723589646 per share, to be charged to the
net distributable income obtained during the fiscal year 2018. Also, the shareholders agreed to withhold of 30% of the distributable
net profit for the year 2018.
|
Additionally, the shareholders
approved the definite appointment of Mr. Julio Santiago Figueroa as Director of Banco de Chile, a position which he will hold until
the next renewal of the Board of Directors.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
5.
|
Relevant Events, continued:
|
|
(f)
|
On May 20, 2019, the subsidiary Banchile Corredores
de Bolsa S.A. reported that in Ordinary Session held on May 17, 2019, the Board of Banchile Corredores de Bolsa S.A. appointed
Mr. Fuad Jorge Muvdi Arenas as titular director.
|
|
(g)
|
On June 4, 2019, Banco de Chile reported that the condition
established in of the Strategic Alliance Framework Agreement subscribed by Banco de Chile, its subsidiary Banchile Corredores
de Seguros Limitada and the insurance companies Chubb Seguros Chile SA and Chubb Seguros de Vida Chile SA, had been met on January
28, 2019, and in order to comply with said agreement, the following contracts had been signed:
|
|
-
|
Contract of Exclusive Access to Distribution Channels
between the Bank and the Companies;
|
|
-
|
Supply, Intermediation and Distribution of Insurance
Contracts between Banchile and each of the Companies;
|
|
-
|
Trademark Use Agreement between the Bank and each
of the Companies; and
|
|
-
|
Collection Contracts between the Bank and each of
the Companies.
|
|
(h)
|
On June 10, 2019, Banco de Chile informed that on that
date Mr. Rodrigo Manubens Moltedo submitted his resignation to the position of Deputy Director of Banco de Chile.
|
|
(i)
|
On June 27, 2019, Banco de Chile informed that in ordinary
session, the Board of Directors appointed Mrs. Sandra Guazzotti as first substitute director, until the next Ordinary Shareholders’
Meeting, replacing Mr. Rodrigo Manubens Moltedo.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
For management
purposes, the Bank is organized into four segments, which are defined based on the types of products and services offered, and
the type of client in which focuses as described below:
|
Retail:
|
This segment focuses on individuals and small and medium-sized companies (SMEs) with annual sales up to UF 70,000, where the product offering focuses primarily on consumer loans, commercial loans, checking accounts, credit cards, credit lines and mortgage loans.
|
|
|
|
|
Wholesale:
|
This segment focused on corporate clients and large companies, whose annual revenue exceed UF 70,000, where the product offering focuses primarily on commercial loans, checking accounts and liquidity management services, debt instruments, foreign trade, derivative contracts and leases.
|
|
|
|
|
Treasury:
|
This segment includes the associated revenues to the management of the investment portfolio and the business of financial transactions and currency trading.
|
|
|
|
|
|
Transactions with customers carried out by the Treasury are reflected in the respective aforementioned segments. These products are highly transaction-focused and include foreign exchange transactions, derivatives and financial instruments in general, among others.
|
|
|
|
|
Subsidiaries:
|
Corresponds to the businesses generated by the companies controlled by the Bank, which carry out activities complementary to the bank business. The companies that comprise this segment are:
|
Entity
|
-
|
Banchile Administradora General de Fondos S.A.
|
|
-
|
Banchile Asesoría Financiera S.A.
|
|
-
|
Banchile Corredores de Seguros Ltda.
|
|
-
|
Banchile Corredores de Bolsa S.A.
|
|
-
|
Banchile Securitizadora S.A.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
6.
|
Business Segments, continued:
|
The
financial information used to measure the performance of the Bank’s business segments is not comparable with similar information
from other financial institutions because each institution relies on its own definitions. The accounting policies applied to the
segments is the same as those described in the summary of accounting principles. The Bank obtains the majority of the results for:
interest, indexation and commissions and financial operations and changes, discounting provisions for credit risk and operating
expenses. Management is mainly based on these concepts to evaluate the performance of the segments and make decisions about the
goals and allocations of resources of each unit. Although the results of the segments reconcile with those of the Bank at the total
level, this is not necessarily the case in terms of the different concepts, given that management is measured and controlled individually
and not on a consolidated basis, applying the following criteria:
|
·
|
The net interest margin of loans and deposits is obtained
aggregating the net financial margins of each individual operation of credit and uptake made by the bank. For these purposes,
the volume of each operation and its contribution margin are considered, which in turn corresponds to the difference between the
effective rate of the customer and the internal transfer price established according to the term and currency of each operation.
Additionally, the net margin includes the result of interest and indexation from the accounting hedges.
|
|
·
|
The capital and its financial impacts on outcome have
been assigned to each segment based on the risk-weighted assets.
|
|
·
|
Operational expenses are reflected at the level of
the different functional areas of the Bank. The allocation of expenses from functional areas to business segments is done using
different allocation criteria, at the level of the different concepts and expense items.
|
Taxes are managed at a corporate
level and are not allocated to business segments.
For the periods ended June
30, 2019 and 2018, there was no income from transactions with a customer or counterparty that accounted for 10% or more of the
Bank’s total revenues.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
6.
|
Business Segments, continued:
|
The
following table presents the income by segment for the periods ended June, 2019 and 2018 for each of the segments defined above:
|
|
Retail
|
|
|
Wholesale
|
|
|
Treasury
|
|
|
Subsidiaries
|
|
|
Subtotal
|
|
|
Consolidation
adjustment
|
|
|
Total
|
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net interest
income
|
|
|
512,190
|
|
|
|
477,250
|
|
|
|
171,707
|
|
|
|
173,158
|
|
|
|
(15,050
|
)
|
|
|
(1,057
|
)
|
|
|
(3,771
|
)
|
|
|
(3,287
|
)
|
|
|
665,076
|
|
|
|
646,064
|
|
|
|
2,024
|
|
|
|
1,466
|
|
|
|
667,100
|
|
|
|
647,530
|
|
Net commissions income
(loss)
|
|
|
122,308
|
|
|
|
92,859
|
|
|
|
24,968
|
|
|
|
22,576
|
|
|
|
(1,616
|
)
|
|
|
(2,087
|
)
|
|
|
74,785
|
|
|
|
71,947
|
|
|
|
220,445
|
|
|
|
185,295
|
|
|
|
(4,801
|
)
|
|
|
(6,071
|
)
|
|
|
215,644
|
|
|
|
179,224
|
|
Other
operating income
|
|
|
16,566
|
|
|
|
14,296
|
|
|
|
28,057
|
|
|
|
27,533
|
|
|
|
31,328
|
|
|
|
20,724
|
|
|
|
27,574
|
|
|
|
15,775
|
|
|
|
103,525
|
|
|
|
78,328
|
|
|
|
(3,357
|
)
|
|
|
(2,850
|
)
|
|
|
100,168
|
|
|
|
75,478
|
|
Total operating revenue
|
|
|
651,064
|
|
|
|
584,405
|
|
|
|
224,732
|
|
|
|
223,267
|
|
|
|
14,662
|
|
|
|
17,580
|
|
|
|
98,588
|
|
|
|
84,435
|
|
|
|
989,046
|
|
|
|
909,687
|
|
|
|
(6,134
|
)
|
|
|
(7,455
|
)
|
|
|
982,912
|
|
|
|
902,232
|
|
Provision for loan
losses
|
|
|
(150,506
|
)
|
|
|
(122,530
|
)
|
|
|
(6,567
|
)
|
|
|
(2,337
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(42
|
)
|
|
|
112
|
|
|
|
(157,115
|
)
|
|
|
(124,755
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(157,115
|
)
|
|
|
(124,755
|
)
|
Depreciation and amortization
|
|
|
(28,614
|
)
|
|
|
(14,542
|
)
|
|
|
(3,039
|
)
|
|
|
(2,439
|
)
|
|
|
(53
|
)
|
|
|
(46
|
)
|
|
|
(2,959
|
)
|
|
|
(1,444
|
)
|
|
|
(34,665
|
)
|
|
|
(18,471
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(34,665
|
)
|
|
|
(18,471
|
)
|
Other operating expenses
|
|
|
(292,382
|
)
|
|
|
(272,777
|
)
|
|
|
(77,095
|
)
|
|
|
(77,464
|
)
|
|
|
(2,622
|
)
|
|
|
(3,064
|
)
|
|
|
(51,893
|
)
|
|
|
(51,558
|
)
|
|
|
(423,992
|
)
|
|
|
(404,863
|
)
|
|
|
6,134
|
|
|
|
7,455
|
|
|
|
(417,858
|
)
|
|
|
(397,408
|
)
|
Income
attributable to associates
|
|
|
3,085
|
|
|
|
3,196
|
|
|
|
490
|
|
|
|
545
|
|
|
|
47
|
|
|
|
60
|
|
|
|
351
|
|
|
|
347
|
|
|
|
3,973
|
|
|
|
4,148
|
|
|
|
—
|
|
|
|
—
|
|
|
|
3,973
|
|
|
|
4,148
|
|
Income
before income taxes
|
|
|
182,647
|
|
|
|
177,752
|
|
|
|
138,521
|
|
|
|
141,572
|
|
|
|
12,034
|
|
|
|
14,530
|
|
|
|
44,045
|
|
|
|
31,892
|
|
|
|
377,247
|
|
|
|
365,746
|
|
|
|
—
|
|
|
|
—
|
|
|
|
377,247
|
|
|
|
365,746
|
|
Income
taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(83,584
|
)
|
|
|
(60,532
|
)
|
Income
after income taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
293,663
|
|
|
|
305,214
|
|
The following table presents assets and
liabilities of the periods ended June 30, 2019 and December 31, 2018 by each segment defined above:
|
|
Retail
|
|
|
Wholesale
|
|
|
Treasury
|
|
|
Subsidiaries
|
|
|
Subtotal
|
|
|
Consolidation
adjustment
|
|
|
Total
|
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
17,141,384
|
|
|
|
16,425,068
|
|
|
|
10,771,497
|
|
|
|
10,592,117
|
|
|
|
8,284,530
|
|
|
|
8,093,850
|
|
|
|
1,081,351
|
|
|
|
925,440
|
|
|
|
37,278,762
|
|
|
|
36,036,475
|
|
|
|
(344,407
|
)
|
|
|
(388,615
|
)
|
|
|
36,934,355
|
|
|
|
35,647,860
|
|
Current
and deferred taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
320,310
|
|
|
|
278,599
|
|
Total
assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
37,254,665
|
|
|
|
35,926,459
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
10,793,601
|
|
|
|
10,369,534
|
|
|
|
9,627,692
|
|
|
|
9,873,018
|
|
|
|
12,793,034
|
|
|
|
11,982,709
|
|
|
|
917,705
|
|
|
|
764,736
|
|
|
|
34,132,032
|
|
|
|
32,989,997
|
|
|
|
(344,407
|
)
|
|
|
(388,615
|
)
|
|
|
33,787,625
|
|
|
|
32,601,382
|
|
Current
and deferred taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
74,389
|
|
|
|
20,924
|
|
Total
liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
33,862,014
|
|
|
|
32,622,306
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
7.
|
Cash and Cash Equivalents:
|
|
(a)
|
The detail of the balances included under cash and
cash equivalents and their reconciliation with the Statement of Cash Flows at the end of each period are detailed as follows:
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Cash and due from banks:
|
|
|
|
|
|
|
|
|
Cash (*)
|
|
|
700,677
|
|
|
|
624,862
|
|
Deposit in Chilean Central Bank (*)
|
|
|
244,486
|
|
|
|
121,807
|
|
Deposits in other domestic banks
|
|
|
5,812
|
|
|
|
26,698
|
|
Deposits abroad
|
|
|
199,707
|
|
|
|
106,714
|
|
Subtotal - Cash and due from banks
|
|
|
1,150,682
|
|
|
|
880,081
|
|
|
|
|
|
|
|
|
|
|
Net transactions in the course of collection
|
|
|
295,944
|
|
|
|
244,758
|
|
Highly liquid financial instruments (**)
|
|
|
953,793
|
|
|
|
1,058,904
|
|
Repurchase agreements (**)
|
|
|
81,077
|
|
|
|
72,632
|
|
Total cash and cash equivalents
|
|
|
2,481,496
|
|
|
|
2,256,375
|
|
|
(*)
|
Amounts in cash funds and in Central Bank are regulatory
reserve deposits that the Bank must maintain as a monthly average.
|
|
(**)
|
It corresponds to negotiation instruments and repurchase
contracts that meet the definition of cash and cash equivalents.
|
|
(b)
|
Transactions in course of settlement:
|
Transactions in course of settlement
are transactions for which the only remaining step is settlement, which will increase or decrease the funds in the Central Bank
or in foreign banks, normally occurring within 24 to 48 business hours, and are detailed as follows:
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
Assets
|
|
|
|
|
|
|
Documents drawn on other banks (clearing)
|
|
|
180,539
|
|
|
|
210,743
|
|
Funds receivable
|
|
|
842,952
|
|
|
|
369,590
|
|
Subtotal transactions in the course of collection
|
|
|
1,023,491
|
|
|
|
580,333
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
Funds payable
|
|
|
(727,547
|
)
|
|
|
(335,575
|
)
|
Subtotal transactions in the course of payment
|
|
|
(727,547
|
)
|
|
|
(335,575
|
)
|
Net transactions in the course of settlement
|
|
|
295,944
|
|
|
|
244,758
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
8.
|
Financial Assets Held-for-trading:
|
The detail of financial instruments
classified as held-for-trading is as follows:
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
Instruments issued by the Chilean Government and Central Bank of Chile
|
|
|
|
|
|
|
Central Bank of Chile bonds
|
|
|
69,292
|
|
|
|
24,906
|
|
Central Bank of Chile promissory notes
|
|
|
1,013,357
|
|
|
|
1,410,080
|
|
Other instruments issued by the Chilean Government and Central Bank
|
|
|
255,513
|
|
|
|
88,486
|
|
|
|
|
|
|
|
|
|
|
Other instruments issued in Chile
|
|
|
|
|
|
|
|
|
Bonds from other domestic companies
|
|
|
—
|
|
|
|
7,532
|
|
Bonds from domestic banks
|
|
|
25,252
|
|
|
|
20,186
|
|
Deposits in domestic banks
|
|
|
133,360
|
|
|
|
100,225
|
|
Other instruments issued in Chile
|
|
|
2,709
|
|
|
|
1,664
|
|
|
|
|
|
|
|
|
|
|
Instruments issued Abroad
|
|
|
|
|
|
|
|
|
Instruments from foreign governments or central banks
|
|
|
—
|
|
|
|
—
|
|
Other instruments issued abroad
|
|
|
—
|
|
|
|
4,446
|
|
|
|
|
|
|
|
|
|
|
Mutual fund investments
|
|
|
|
|
|
|
|
|
Funds managed by related companies
|
|
|
50,675
|
|
|
|
87,841
|
|
Funds managed by third-party
|
|
|
—
|
|
|
|
—
|
|
Total
|
|
|
1,550,158
|
|
|
|
1,745,366
|
|
Under “Instruments issued
by the Chilean Government and Central Bank of Chile” are classified instruments sold under repurchase agreements to customers
and financial instruments, by an amount of Ch$73,529 million as of June 30, 2019 (Ch$115,749 million as of December 31, 2018).
Repurchase agreements had a 1 day average expiration as of period-end 2019 (2 days in December 2018).
Moreover, under this same item,
other financial instruments are maintained as collateral guaranteeing the derivative transactions executed through Comder Contraparte
Central S.A. for an amount of Ch$52,758 as of June 30, 2019 (Ch$34,456 million as of December 31, 2018).
“Other instruments issued
in Chile” include instruments sold under repurchase agreements with customers and financial instruments amounting to Ch$120,543
million as of June 30, 2019 (Ch$99,268 million as of December 31, 2018). The repurchase agreements have an average expiration of
11 days as of period-end 2019 (10 days in December 2018).
Additionally, the Bank holds financial
investments in mortgage finance bonds issued by itself in the amount of Ch$9,892 million as of June 30, 2019 (Ch$11,397 million
as of December 31, 2018), which are presented as a reduction of the liability line item “Debt issued”.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
9.
|
Cash collateral on securities borrowed and reverse repurchase
agreements:
|
|
(a)
|
Receivables for repurchase agreements: The Bank provides financing to its customers through repurchase
agreements and security borrowings, in which the financial instrument serves as collateral. As of June 30, 2019 and December 31,
2018, the detail is as follows:
|
|
|
Up
to 1 month
|
|
|
Over
1 month and up to 3 months
|
|
|
Over
3 months and up to 12 months
|
|
|
Over
1 year and up to 3 years
|
|
|
Over
3 years and up to 5 years
|
|
|
Over
5 years
|
|
|
Total
|
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Instruments issued
by the Chilean Governments and Central Bank of Chile
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Central Bank bonds
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Central
Bank promissory notes
|
|
|
—
|
|
|
|
742
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
742
|
|
Other
instruments issued by the Chilean Government and Central Bank
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Subtotal
|
|
|
—
|
|
|
|
742
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
742
|
|
Other
Instruments issued in Chile
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposit promissory
notes from domestic banks
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Mortgage bonds from
domestic banks
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Bonds from domestic
banks
|
|
|
—
|
|
|
|
367
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
367
|
|
Deposits in domestic
banks
|
|
|
—
|
|
|
|
2,053
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
2,053
|
|
Bonds from other Chilean
companies
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Other
instruments issued in Chile
|
|
|
66,612
|
|
|
|
70,334
|
|
|
|
14,466
|
|
|
|
16,918
|
|
|
|
12,904
|
|
|
|
6,875
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
93,982
|
|
|
|
94,127
|
|
Subtotal
|
|
|
66,612
|
|
|
|
72,754
|
|
|
|
14,466
|
|
|
|
16,918
|
|
|
|
12,904
|
|
|
|
6,875
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
93,982
|
|
|
|
96,547
|
|
Instruments
issued by foreign institutions
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Instruments from foreign
governments or Central Bank
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Other
instruments
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Subtotal
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Mutual fund investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Funds managed by related
companies
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Funds
managed by third-party
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Subtotal
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Total
|
|
|
66,612
|
|
|
|
73,496
|
|
|
|
14,466
|
|
|
|
16,918
|
|
|
|
12,904
|
|
|
|
6,875
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
93,982
|
|
|
|
97,289
|
|
Securities
received:
The
Bank and its subsidiaries have received financial instruments that they can sell or give as collateral in case the owner of these
instruments enters into default or in bankruptcy. As of June 30, 2019, the fair value of the instruments received amounts to Ch$93,612
million (Ch$95,316 million as of December, 2018).
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
9.
|
Cash collateral on securities lent and repurchase
agreements, continued:
|
|
(b)
|
Liabilities for repurchase contracts: The Bank obtains
financing by selling financial instruments and committing to purchase them at future dates, plus interest at a prefixed rate.
As of June 30, 2019 and December 31, 2018, the repurchase agreements are the following:
|
|
|
Up
to 1 month
|
|
|
Over
1 month and
up to 3 months
|
|
|
Over 3 months and
up to 12 months
|
|
|
Over
1 year and
up to 3 years
|
|
|
Over
3 years and
up to 5 years
|
|
|
Over
5 years
|
|
|
Total
|
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Instruments issued
by the Chilean Governments and Central Bank of Chile
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Central
Bank bonds
|
|
|
—
|
|
|
|
130,197
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
130,197
|
|
Central Bank promissory
notes
|
|
|
25,452
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
25,452
|
|
|
|
—
|
|
Other
instruments issued by the Chilean Government and Central Bank
|
|
|
47,923
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
47,923
|
|
|
|
—
|
|
Subtotal
|
|
|
73,375
|
|
|
|
130,197
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
73,375
|
|
|
|
130,197
|
|
Other
Instruments issued in Chile
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposit promissory
notes from domestic banks
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Mortgage bonds from
domestic banks
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Bonds from domestic
banks
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Deposits in domestic
banks
|
|
|
—
|
|
|
|
162,167
|
|
|
|
—
|
|
|
|
1,448
|
|
|
|
—
|
|
|
|
5,210
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
168,825
|
|
Bonds from other Chilean
companies
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Other
instruments issued in Chile
|
|
|
185,906
|
|
|
|
4,798
|
|
|
|
693
|
|
|
|
—
|
|
|
|
1,146
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
187,745
|
|
|
|
4,798
|
|
Subtotal
|
|
|
185,906
|
|
|
|
166,965
|
|
|
|
693
|
|
|
|
1,448
|
|
|
|
1,146
|
|
|
|
5,210
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
187,745
|
|
|
|
173,623
|
|
Instruments
issued by foreign institutions
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Instruments from foreign
governments or central bank
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Other
instruments issued by foreing
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Subtotal
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Mutual fund investments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Funds managed by related
companies
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Funds
managed by third-party
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Subtotal
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Total
|
|
|
259,281
|
|
|
|
297,162
|
|
|
|
693
|
|
|
|
1,448
|
|
|
|
1,146
|
|
|
|
5,210
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
261,120
|
|
|
|
303,820
|
|
Securities sold:
The fair value of the financial
instruments delivered as collateral by the Bank and its subsidiaries, in sales transactions with repurchase agreement and securities
loans as of June 30, 2019 amounts to Ch$259,532 million (Ch$298,708 million in December 2018). In the event that the Bank and its
subsidiaries enter into default or bankruptcy, the counterparty is authorized to sell or deliver these investments as collateral.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
10.
|
Derivative Instruments and
Accounting
Hedges:
|
|
(a)
|
As of June 30,
2019 and December 31, 2018, the Bank’s portfolio of derivative instruments is detailed as follows:
|
|
|
Notional amount of contract with final expiration date in
|
|
|
Fair Value
|
|
|
|
Up to 1 month
|
|
|
Over 1 month and up to 3 months
|
|
|
Over 3 months and up to 12 months
|
|
|
Over 1 year and up to 3 years
|
|
|
Over 3 year and up to 5 years
|
|
|
Over 5 years
|
|
|
Total
|
|
|
Assets
|
|
|
Liabilities
|
|
As of June 30, 2019
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Derivatives held for hedging purposes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate swap and cross currency swap
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,659
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,659
|
|
|
|
—
|
|
|
|
2,838
|
|
Interest rate swap
|
|
|
—
|
|
|
|
—
|
|
|
|
10,329
|
|
|
|
10,790
|
|
|
|
3,394
|
|
|
|
71,776
|
|
|
|
96,289
|
|
|
|
46
|
|
|
|
6,179
|
|
Total derivatives held for hedging purposes
|
|
|
—
|
|
|
|
—
|
|
|
|
10,329
|
|
|
|
20,449
|
|
|
|
3,394
|
|
|
|
71,776
|
|
|
|
105,948
|
|
|
|
46
|
|
|
|
9,017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivatives held as cash flow hedges
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate swap and cross currency swap
|
|
|
—
|
|
|
|
—
|
|
|
|
248,839
|
|
|
|
137,970
|
|
|
|
132,876
|
|
|
|
551,649
|
|
|
|
1,071,334
|
|
|
|
14,476
|
|
|
|
60,286
|
|
Total derivatives held as cash flow hedges
|
|
|
—
|
|
|
|
—
|
|
|
|
248,839
|
|
|
|
137,970
|
|
|
|
132,876
|
|
|
|
551,649
|
|
|
|
1,071,334
|
|
|
|
14,476
|
|
|
|
60,286
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trading derivatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency forward
|
|
|
11,035,266
|
|
|
|
5,865,696
|
|
|
|
14,521,276
|
|
|
|
3,909,421
|
|
|
|
140,697
|
|
|
|
34,615
|
|
|
|
35,506,971
|
|
|
|
322,472
|
|
|
|
278,839
|
|
Interest rate swap
|
|
|
2,059,967
|
|
|
|
6,043,461
|
|
|
|
15,881,126
|
|
|
|
17,937,298
|
|
|
|
6,873,410
|
|
|
|
9,722,926
|
|
|
|
58,518,188
|
|
|
|
664,162
|
|
|
|
670,095
|
|
Interest rate swap and cross currency swap
|
|
|
286,254
|
|
|
|
487,684
|
|
|
|
3,279,522
|
|
|
|
5,238,796
|
|
|
|
3,252,845
|
|
|
|
4,089,393
|
|
|
|
16,634,494
|
|
|
|
432,344
|
|
|
|
551,297
|
|
Call currency options
|
|
|
14,257
|
|
|
|
57,466
|
|
|
|
89,820
|
|
|
|
9,213
|
|
|
|
—
|
|
|
|
—
|
|
|
|
170,756
|
|
|
|
1,907
|
|
|
|
948
|
|
Put currency options
|
|
|
12,763
|
|
|
|
52,503
|
|
|
|
81,135
|
|
|
|
7,177
|
|
|
|
—
|
|
|
|
—
|
|
|
|
153,578
|
|
|
|
357
|
|
|
|
2,139
|
|
Total trading derivatives
|
|
|
13,408,507
|
|
|
|
12,506,810
|
|
|
|
33,852,879
|
|
|
|
27,101,905
|
|
|
|
10,266,952
|
|
|
|
13,846,934
|
|
|
|
110,983,987
|
|
|
|
1,421,242
|
|
|
|
1,503,318
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
13,408,507
|
|
|
|
12,506,810
|
|
|
|
34,112,047
|
|
|
|
27,260,324
|
|
|
|
10,403,222
|
|
|
|
14,470,359
|
|
|
|
112,161,269
|
|
|
|
1,435,764
|
|
|
|
1,572,621
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
10
.
|
Derivative Instruments and
Accounting
Hedges, continued:
|
|
(a)
|
P
ortfolio of derivative instruments, continued:
|
|
|
Notional amount of contract with final expiration date in
|
|
|
Fair Value
|
|
|
|
Up to 1 month
|
|
|
Over 1 month and up to 3 months
|
|
|
Over 3 months and up to 12 months
|
|
|
Over 1 year and up to 3 years
|
|
|
Over 3 year and up to 5 years
|
|
|
Over 5 years
|
|
|
Total
|
|
|
Assets
|
|
|
Liabilities
|
|
As of December 31, 2018
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Derivatives held for hedging purposes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate swap and cross currency swap
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
11,132
|
|
|
|
—
|
|
|
|
11,132
|
|
|
|
—
|
|
|
|
3,012
|
|
Interest rate swap
|
|
|
—
|
|
|
|
—
|
|
|
|
10,555
|
|
|
|
—
|
|
|
|
16,078
|
|
|
|
200,321
|
|
|
|
226,954
|
|
|
|
1,116
|
|
|
|
3,152
|
|
Total derivatives held for hedging purposes
|
|
|
—
|
|
|
|
—
|
|
|
|
10,555
|
|
|
|
—
|
|
|
|
27,210
|
|
|
|
200,321
|
|
|
|
238,086
|
|
|
|
1,116
|
|
|
|
6,164
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivatives held as cash flow hedges
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate swap and cross currency swap
|
|
|
—
|
|
|
|
142,045
|
|
|
|
213,518
|
|
|
|
136,852
|
|
|
|
163,027
|
|
|
|
482,015
|
|
|
|
1,137,457
|
|
|
|
34,298
|
|
|
|
31,818
|
|
Total derivatives held as cash flow hedges
|
|
|
—
|
|
|
|
142,045
|
|
|
|
213,518
|
|
|
|
136,852
|
|
|
|
163,027
|
|
|
|
482,015
|
|
|
|
1,137,457
|
|
|
|
34,298
|
|
|
|
31,818
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trading derivatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency forward
|
|
|
8,414,296
|
|
|
|
9,941,108
|
|
|
|
13,350,051
|
|
|
|
3,843,703
|
|
|
|
92,395
|
|
|
|
35,374
|
|
|
|
35,676,927
|
|
|
|
735,444
|
|
|
|
631,047
|
|
Interest rate swap
|
|
|
3,977,068
|
|
|
|
9,065,335
|
|
|
|
25,723,239
|
|
|
|
17,216,272
|
|
|
|
7,219,269
|
|
|
|
9,129,644
|
|
|
|
72,330,827
|
|
|
|
287,611
|
|
|
|
284,840
|
|
Interest rate swap and cross currency swap
|
|
|
227,185
|
|
|
|
369,509
|
|
|
|
1,983,836
|
|
|
|
4,366,801
|
|
|
|
3,339,946
|
|
|
|
3,695,613
|
|
|
|
13,982,890
|
|
|
|
450,519
|
|
|
|
570,033
|
|
Call currency options
|
|
|
16,988
|
|
|
|
71,243
|
|
|
|
131,175
|
|
|
|
9,769
|
|
|
|
—
|
|
|
|
—
|
|
|
|
229,175
|
|
|
|
4,839
|
|
|
|
2,921
|
|
Put currency options
|
|
|
16,141
|
|
|
|
62,809
|
|
|
|
103,834
|
|
|
|
9,769
|
|
|
|
—
|
|
|
|
—
|
|
|
|
192,553
|
|
|
|
120
|
|
|
|
1,534
|
|
Total trading derivatives
|
|
|
12,651,678
|
|
|
|
19,510,004
|
|
|
|
41,292,135
|
|
|
|
25,446,314
|
|
|
|
10,651,610
|
|
|
|
12,860,631
|
|
|
|
122,412,372
|
|
|
|
1,478,533
|
|
|
|
1,490,375
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
12,651,678
|
|
|
|
19,652,049
|
|
|
|
41,516,208
|
|
|
|
25,583,166
|
|
|
|
10,841,847
|
|
|
|
13,542,967
|
|
|
|
123,787,915
|
|
|
|
1,513,947
|
|
|
|
1,528,357
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
10.
|
Derivative Instruments and Accounting Hedges, continued:
|
The Bank uses cross-currency
swaps and interest rate swaps to hedge its exposure to changes in the fair value of the hedged elements attributable to interest
rates in financial instruments. The aforementioned hedge instruments change the effective cost of long-term assets from a fixed
interest rate to a floating rate, decreasing the duration and modifying the sensitivity to the shortest segments of the curve.
Below is a detail of the hedged
elements and instruments under fair value hedges as of June 30, 2019 and December 31, 2018:
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
Hedge element
|
|
|
|
|
|
|
Commercial loans
|
|
|
9,659
|
|
|
|
11,132
|
|
Corporate bonds
|
|
|
96,289
|
|
|
|
226,954
|
|
|
|
|
|
|
|
|
|
|
Hedge instrument
|
|
|
|
|
|
|
|
|
Cross currency swap
|
|
|
9,659
|
|
|
|
11,132
|
|
Interest rate swap
|
|
|
96,289
|
|
|
|
226,954
|
|
|
(c.1)
|
The Bank uses cross currency swaps to hedge the risk
from variability of cash flows attributable to changes in the interest rates and foreign exchange of foreign banks obligations
and bonds issued abroad in US Dollars, Hong Kong dollars, Swiss Franc, Japanese Yens and Euros. The cash flows of the cross currency
swaps equal the cash flows of the hedged items, which modify uncertain cash flows to known cash flows derived from a fixed interest
rate.
|
Additionally, these cross currency
swap contracts used to hedge the risk from variability of the Unidad de Fomento (“CLF”) in assets flows denominated
in CLF until a nominal amount equal to the portion notional of the hedging instrument CLF, whose readjustment daily impact the
item “Interest Revenue” of the Income Financial Statements.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
10.
|
Derivative Instruments and Accounting Hedges, continued:
|
|
(c)
|
Cash flow Hedges, continued:
|
|
(c.2)
|
Below are the cash flows from bonds issued abroad
objects of this hedge and the cash flows of the asset part of the derivative instrument:
|
|
|
Up
to 1 month
|
|
|
Over 1 month and
up to 3 months
|
|
|
Over
3 months and
up to 12 months
|
|
|
Over
1 year and
up to 3 years
|
|
|
Over
3 years and
up to 5 years
|
|
|
Over
5 years
|
|
|
Total
|
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hedge
element
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outflows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate
Bond EUR
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1,300
|
)
|
|
|
(1,338
|
)
|
|
|
(2,600
|
)
|
|
|
(2,675
|
)
|
|
|
(2,600
|
)
|
|
|
(2,675
|
)
|
|
|
(83,959
|
)
|
|
|
(87,097
|
)
|
|
|
(90,459
|
)
|
|
|
(93,785
|
)
|
Corporate Bond HKD
|
|
|
—
|
|
|
|
—
|
|
|
|
(4,423
|
)
|
|
|
—
|
|
|
|
(59,100
|
)
|
|
|
(66,378
|
)
|
|
|
(21,186
|
)
|
|
|
(21,601
|
)
|
|
|
(80,059
|
)
|
|
|
(83,608
|
)
|
|
|
(258,216
|
)
|
|
|
(263,206
|
)
|
|
|
(422,984
|
)
|
|
|
(434,793
|
)
|
Corporate Bond CHF
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(89,256
|
)
|
|
|
(124,290
|
)
|
|
|
(125,993
|
)
|
|
|
(1,431
|
)
|
|
|
(1,450
|
)
|
|
|
(81,437
|
)
|
|
|
(82,552
|
)
|
|
|
(104,617
|
)
|
|
|
(106,050
|
)
|
|
|
(311,775
|
)
|
|
|
(405,301
|
)
|
Corporate Bond USD
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1,444
|
)
|
|
|
(1,476
|
)
|
|
|
(2,889
|
)
|
|
|
(2,952
|
)
|
|
|
(2,889
|
)
|
|
|
(2,952
|
)
|
|
|
(40,436
|
)
|
|
|
(42,060
|
)
|
|
|
(47,658
|
)
|
|
|
(49,440
|
)
|
Obligation USD
|
|
|
(193
|
)
|
|
|
(870
|
)
|
|
|
(87
|
)
|
|
|
(86
|
)
|
|
|
(48,178
|
)
|
|
|
(49,401
|
)
|
|
|
(102,970
|
)
|
|
|
(105,622
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(151,428
|
)
|
|
|
(155,979
|
)
|
Corporate Bond JPY
|
|
|
—
|
|
|
|
—
|
|
|
|
(86
|
)
|
|
|
(49,362
|
)
|
|
|
(33,176
|
)
|
|
|
(1,072
|
)
|
|
|
(34,708
|
)
|
|
|
(33,487
|
)
|
|
|
(2,543
|
)
|
|
|
(32,882
|
)
|
|
|
(143,998
|
)
|
|
|
(71,830
|
)
|
|
|
(214,511
|
)
|
|
|
(188,633
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hedge
instrument
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Inflows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cross Currency Swap
EUR
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,300
|
|
|
|
1,338
|
|
|
|
2,600
|
|
|
|
2,675
|
|
|
|
2,600
|
|
|
|
2,675
|
|
|
|
83,959
|
|
|
|
87,097
|
|
|
|
90,459
|
|
|
|
93,785
|
|
Cross Currency Swap
HKD
|
|
|
—
|
|
|
|
—
|
|
|
|
4,423
|
|
|
|
—
|
|
|
|
59,100
|
|
|
|
66,378
|
|
|
|
21,186
|
|
|
|
21,601
|
|
|
|
80,059
|
|
|
|
83,608
|
|
|
|
258,216
|
|
|
|
263,206
|
|
|
|
422,984
|
|
|
|
434,793
|
|
Cross Currency Swap
CHF
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
89,256
|
|
|
|
124,290
|
|
|
|
125,993
|
|
|
|
1,431
|
|
|
|
1,450
|
|
|
|
81,437
|
|
|
|
82,552
|
|
|
|
104,617
|
|
|
|
106,050
|
|
|
|
311,775
|
|
|
|
405,301
|
|
Cross Currency Swap
USD
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,444
|
|
|
|
1,476
|
|
|
|
2,889
|
|
|
|
2,952
|
|
|
|
2,889
|
|
|
|
2,952
|
|
|
|
40,436
|
|
|
|
42,060
|
|
|
|
47,658
|
|
|
|
49,440
|
|
Cross Currency Swap
USD
|
|
|
193
|
|
|
|
870
|
|
|
|
87
|
|
|
|
86
|
|
|
|
48,178
|
|
|
|
49,401
|
|
|
|
102,970
|
|
|
|
105,622
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
151,428
|
|
|
|
155,979
|
|
Cross
Currency Swap JPY
|
|
|
—
|
|
|
|
—
|
|
|
|
86
|
|
|
|
49,362
|
|
|
|
33,176
|
|
|
|
1,072
|
|
|
|
34,708
|
|
|
|
33,487
|
|
|
|
2,543
|
|
|
|
32,882
|
|
|
|
143,998
|
|
|
|
71,830
|
|
|
|
214,511
|
|
|
|
188,633
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
cash flows
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
10.
|
Derivative Instruments and Accounting Hedges, continued:
|
|
(c)
|
Cash flow Hedges, continued:
|
|
(c.2)
|
Below are the cash flows from underlying assets and
the cash flows of the liability part of the derivative instrument:
|
|
|
Up
to 1 month
|
|
|
Over
1 month and
up to 3 months
|
|
|
Over
3 months and
up to 12 months
|
|
|
Over
1 year and
up to 3 years
|
|
|
Over
3 years and
up to 5 years
|
|
|
Over
5 years
|
|
|
Total
|
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hedge element
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Inflows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows
in CLF
|
|
|
—
|
|
|
|
—
|
|
|
|
3,724
|
|
|
|
144,458
|
|
|
|
268,092
|
|
|
|
237,340
|
|
|
|
176,305
|
|
|
|
173,263
|
|
|
|
165,463
|
|
|
|
195,590
|
|
|
|
627,781
|
|
|
|
542,523
|
|
|
|
1,241,365
|
|
|
|
1,293,174
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hedge
instrument
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outflows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cross Currency Swap
HKD
|
|
|
—
|
|
|
|
—
|
|
|
|
(3,349
|
)
|
|
|
—
|
|
|
|
(56,402
|
)
|
|
|
(59,667
|
)
|
|
|
(17,031
|
)
|
|
|
(16,835
|
)
|
|
|
(67,455
|
)
|
|
|
(68,362
|
)
|
|
|
(236,143
|
)
|
|
|
(233,286
|
)
|
|
|
(380,380
|
)
|
|
|
(378,150
|
)
|
Cross Currency Swap
JPY
|
|
|
—
|
|
|
|
—
|
|
|
|
(375
|
)
|
|
|
(50,247
|
)
|
|
|
(36,704
|
)
|
|
|
(2,740
|
)
|
|
|
(39,361
|
)
|
|
|
(37,432
|
)
|
|
|
(5,491
|
)
|
|
|
(35,213
|
)
|
|
|
(160,677
|
)
|
|
|
(78,611
|
)
|
|
|
(242,608
|
)
|
|
|
(204,243
|
)
|
Cross Currency Swap
USD
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(48,117
|
)
|
|
|
(47,797
|
)
|
|
|
(108,679
|
)
|
|
|
(107,893
|
)
|
|
|
(1,261
|
)
|
|
|
(1,243
|
)
|
|
|
(37,024
|
)
|
|
|
(36,888
|
)
|
|
|
(195,081
|
)
|
|
|
(193,821
|
)
|
Cross Currency Swap
CHF
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(94,211
|
)
|
|
|
(125,033
|
)
|
|
|
(125,325
|
)
|
|
|
(7,571
|
)
|
|
|
(7,482
|
)
|
|
|
(87,599
|
)
|
|
|
(87,164
|
)
|
|
|
(108,561
|
)
|
|
|
(108,488
|
)
|
|
|
(328,764
|
)
|
|
|
(422,670
|
)
|
Cross
Currency Swap EUR
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1,836
|
)
|
|
|
(1,811
|
)
|
|
|
(3,663
|
)
|
|
|
(3,621
|
)
|
|
|
(3,657
|
)
|
|
|
(3,608
|
)
|
|
|
(85,376
|
)
|
|
|
(85,250
|
)
|
|
|
(94,532
|
)
|
|
|
(94,290
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
cash flows
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
10.
|
Derivative Instruments and Accounting Hedges, continued:
|
|
(c)
|
Cash flow Hedges, continued:
|
With respect to CLF assets hedged;
these are revalued monthly according to the variation of the UF, which is equivalent to monthly reinvest the assets until maturity
of the relationship hedging.
|
(c.3)
|
The unrealized results generated during the period
2019 by those derivative contracts that conform the hedging instruments in this cash flow hedging strategy, have been recorded
with charge to equity amounting to Ch$25,344 million (charge to equity of Ch$30,342 million in June 30, 2018). The net effect
of taxes charge to equity amounts to Ch$18,501 million (net charge to equity of Ch$22,150 million credit to equity during the
period June 2018).
|
The accumulated balance for
this concept as of June 30, 2019 corresponds to a charge in equity amounted to Ch$68,838 million (charge to equity of Ch$43,494
million as of December 31, 2018).
|
(c.4)
|
The net effect in income of derivatives cash flow
hedges amount to Ch$36,663 million charge to income during the period 2019 (Ch$36,730 million credit to income during the period
June 2018).
|
|
(c.5)
|
As of June 30, 2019 and 2018, it not exist inefficiency
in cash flow hedge, because both, hedge item and hedge instruments, are mirrors of each other, it means that all variation of
value attributable to rate and revaluation components are netted totally.
|
|
(c.6)
|
As of June 30, 2019 and 2018, the Bank does not have hedges
of net investments in foreign business.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
11.
|
Loans and advances to Banks:
|
|
(a)
|
At the end of each reporting
period, the balances presented in the item “Loans and advances to Banks” are as follows:
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
Domestic Banks
|
|
|
|
|
|
|
|
|
Interbank loans of liquidity
|
|
|
105,015
|
|
|
|
100,023
|
|
Provisions for loans to domestic banks
|
|
|
(93
|
)
|
|
|
(83
|
)
|
Subtotal
|
|
|
104,922
|
|
|
|
99,940
|
|
Foreign Banks
|
|
|
|
|
|
|
|
|
Interbank loans commercial
|
|
|
290,304
|
|
|
|
239,797
|
|
Credits with third countries
|
|
|
52,197
|
|
|
|
41,872
|
|
Chilean exports trade loans
|
|
|
85,114
|
|
|
|
12,873
|
|
Provisions for loans to foreign banks
|
|
|
(774
|
)
|
|
|
(1,006
|
)
|
Subtotal
|
|
|
426,841
|
|
|
|
293,536
|
|
Central Bank of Chile
|
|
|
|
|
|
|
|
|
Non-available Central Bank deposits
|
|
|
660,083
|
|
|
|
1,100,306
|
|
Other Central Bank credits
|
|
|
—
|
|
|
|
525
|
|
Subtotal
|
|
|
660,083
|
|
|
|
1,100,831
|
|
Total
|
|
|
1,191,846
|
|
|
|
1,494,307
|
|
|
(b)
|
The changes in provisions of the credits owed by the
banks, during the periods 2019 and 2018, are summarized as follows:
|
|
|
Bank’s Location
|
|
|
|
|
|
|
Chile
|
|
|
Abroad
|
|
|
Total
|
|
Detail
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of January 1, 2018
|
|
|
43
|
|
|
|
540
|
|
|
|
583
|
|
Provisions established
|
|
|
11
|
|
|
|
572
|
|
|
|
583
|
|
Provisions released
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Balance as of June 30, 2018
|
|
|
54
|
|
|
|
1,112
|
|
|
|
1,166
|
|
Provisions established
|
|
|
29
|
|
|
|
—
|
|
|
|
29
|
|
Provisions released
|
|
|
—
|
|
|
|
(106
|
)
|
|
|
(106
|
)
|
Balance as of December 31, 2018
|
|
|
83
|
|
|
|
1,006
|
|
|
|
1,089
|
|
Provisions established
|
|
|
10
|
|
|
|
—
|
|
|
|
10
|
|
Provisions released
|
|
|
—
|
|
|
|
(232
|
)
|
|
|
(232
|
)
|
Balance as of June 30, 2019
|
|
|
93
|
|
|
|
774
|
|
|
|
867
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
12.
|
Loans to Customers, net:
|
|
(a.i)
|
Loans to Customers:
|
As
of June 30, 2019 and December 31, 2018, the portfolio of loans is composed as follows:
|
|
As of June 30, 2019
|
|
|
|
Assets before allowances
|
|
|
Allowances established
|
|
|
|
|
|
|
Normal Portfolio
|
|
|
Substandard Portfolio
|
|
|
Non-Complying Portfolio
|
|
|
Total
|
|
|
Individual Provisions
|
|
|
Group Provisions
|
|
|
Total
|
|
|
Net assets
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Commercial loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial loans
|
|
|
11,257,006
|
|
|
|
47,223
|
|
|
|
318,628
|
|
|
|
11,622,857
|
|
|
|
(105,099
|
)
|
|
|
(105,902
|
)
|
|
|
(211,001
|
)
|
|
|
11,411,856
|
|
Foreign trade loans
|
|
|
1,502,375
|
|
|
|
9,165
|
|
|
|
12,003
|
|
|
|
1,523,543
|
|
|
|
(36,635
|
)
|
|
|
(2,817
|
)
|
|
|
(39,452
|
)
|
|
|
1,484,091
|
|
Current account debtors
|
|
|
278,939
|
|
|
|
3,421
|
|
|
|
3,505
|
|
|
|
285,865
|
|
|
|
(3,471
|
)
|
|
|
(9,267
|
)
|
|
|
(12,738
|
)
|
|
|
273,127
|
|
Factoring transactions
|
|
|
630,956
|
|
|
|
4,819
|
|
|
|
1,806
|
|
|
|
637,581
|
|
|
|
(10,310
|
)
|
|
|
(1,209
|
)
|
|
|
(11,519
|
)
|
|
|
626,062
|
|
Student loans
|
|
|
53,574
|
|
|
|
—
|
|
|
|
1,398
|
|
|
|
54,972
|
|
|
|
—
|
|
|
|
(1,371
|
)
|
|
|
(1,371
|
)
|
|
|
53,601
|
|
Commercial lease transactions (1)
|
|
|
1,579,827
|
|
|
|
14,167
|
|
|
|
27,899
|
|
|
|
1,621,893
|
|
|
|
(6,065
|
)
|
|
|
(4,039
|
)
|
|
|
(10,104
|
)
|
|
|
1,611,789
|
|
Other loans and accounts receivable
|
|
|
81,998
|
|
|
|
322
|
|
|
|
10,096
|
|
|
|
92,416
|
|
|
|
(2,515
|
)
|
|
|
(6,959
|
)
|
|
|
(9,474
|
)
|
|
|
82,942
|
|
Subtotal
|
|
|
15,384,675
|
|
|
|
79,117
|
|
|
|
375,335
|
|
|
|
15,839,127
|
|
|
|
(164,095
|
)
|
|
|
(131,564
|
)
|
|
|
(295,659
|
)
|
|
|
15,543,468
|
|
Mortgage loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Letters of credit
|
|
|
16,852
|
|
|
|
—
|
|
|
|
1,214
|
|
|
|
18,066
|
|
|
|
—
|
|
|
|
(15
|
)
|
|
|
(15
|
)
|
|
|
18,051
|
|
Endorsable mortgage loans
|
|
|
36,225
|
|
|
|
—
|
|
|
|
1,211
|
|
|
|
37,436
|
|
|
|
—
|
|
|
|
(27
|
)
|
|
|
(27
|
)
|
|
|
37,409
|
|
Other residential lending
|
|
|
8,310,672
|
|
|
|
—
|
|
|
|
162,693
|
|
|
|
8,473,365
|
|
|
|
—
|
|
|
|
(25,707
|
)
|
|
|
(25,707
|
)
|
|
|
8,447,658
|
|
Credit from ANAP
|
|
|
5
|
|
|
|
—
|
|
|
|
—
|
|
|
|
5
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
5
|
|
Residential lease transactions
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Other loans and accounts receivable
|
|
|
9,872
|
|
|
|
—
|
|
|
|
230
|
|
|
|
10,102
|
|
|
|
—
|
|
|
|
(263
|
)
|
|
|
(263
|
)
|
|
|
9,839
|
|
Subtotal
|
|
|
8,373,626
|
|
|
|
—
|
|
|
|
165,348
|
|
|
|
8,538,974
|
|
|
|
—
|
|
|
|
(26,012
|
)
|
|
|
(26,012
|
)
|
|
|
8,512,962
|
|
Consumer loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consumer loans in installments
|
|
|
2,745,004
|
|
|
|
—
|
|
|
|
242,641
|
|
|
|
2,987,645
|
|
|
|
—
|
|
|
|
(242,751
|
)
|
|
|
(242,751
|
)
|
|
|
2,744,894
|
|
Current account debtors
|
|
|
297,698
|
|
|
|
—
|
|
|
|
1,972
|
|
|
|
299,670
|
|
|
|
—
|
|
|
|
(14,860
|
)
|
|
|
(14,860
|
)
|
|
|
284,810
|
|
Credit card debtors
|
|
|
1,148,054
|
|
|
|
—
|
|
|
|
19,576
|
|
|
|
1,167,630
|
|
|
|
—
|
|
|
|
(48,490
|
)
|
|
|
(48,490
|
)
|
|
|
1,119,140
|
|
Consumer lease transactions (1)
|
|
|
8
|
|
|
|
—
|
|
|
|
—
|
|
|
|
8
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
8
|
|
Other loans and accounts receivable
|
|
|
11
|
|
|
|
—
|
|
|
|
744
|
|
|
|
755
|
|
|
|
—
|
|
|
|
(437
|
)
|
|
|
(437
|
)
|
|
|
318
|
|
Subtotal
|
|
|
4,190,775
|
|
|
|
—
|
|
|
|
264,933
|
|
|
|
4,455,708
|
|
|
|
—
|
|
|
|
(306,538
|
)
|
|
|
(306,538
|
)
|
|
|
4,149,170
|
|
Total
|
|
|
27,949,076
|
|
|
|
79,117
|
|
|
|
805,616
|
|
|
|
28,833,809
|
|
|
|
(164,095
|
)
|
|
|
(464,114
|
)
|
|
|
(628,209
|
)
|
|
|
28,205,600
|
|
|
(1)
|
In this item, the Bank finances its customers purchases
of assets, including real estate and other personal property, through finance lease agreements. As of June 30, 2019 Ch$765,050
million correspond to finance leases for real estate and Ch$856,851 million correspond to finance leases for movable assets.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
12.
|
Loans to Customers net, continued:
|
|
(a.i)
|
Loans to Customers, continued:
|
|
|
As of December 31, 2018
|
|
|
|
Assets before allowances
|
|
|
Allowances established
|
|
|
|
|
|
|
Normal Portfolio
|
|
|
Substandard Portfolio
|
|
|
Non-Complying Portfolio
|
|
|
Total
|
|
|
Individual Provisions
|
|
|
Group Provisions
|
|
|
Total
|
|
|
Net assets
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Commercial loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial loans
|
|
|
11,135,653
|
|
|
|
56,275
|
|
|
|
298,916
|
|
|
|
11,490,844
|
|
|
|
(104,382
|
)
|
|
|
(100,310
|
)
|
|
|
(204,692
|
)
|
|
|
11,286,152
|
|
Foreign trade loans
|
|
|
1,290,718
|
|
|
|
7,619
|
|
|
|
14,012
|
|
|
|
1,312,349
|
|
|
|
(36,984
|
)
|
|
|
(3,449
|
)
|
|
|
(40,433
|
)
|
|
|
1,271,916
|
|
Current account debtors
|
|
|
215,228
|
|
|
|
3,500
|
|
|
|
3,443
|
|
|
|
222,171
|
|
|
|
(3,723
|
)
|
|
|
(9,067
|
)
|
|
|
(12,790
|
)
|
|
|
209,381
|
|
Factoring transactions
|
|
|
694,367
|
|
|
|
3,847
|
|
|
|
2,517
|
|
|
|
700,731
|
|
|
|
(11,289
|
)
|
|
|
(1,901
|
)
|
|
|
(13,190
|
)
|
|
|
687,541
|
|
Student loans
|
|
|
50,230
|
|
|
|
—
|
|
|
|
1,667
|
|
|
|
51,897
|
|
|
|
—
|
|
|
|
(1,502
|
)
|
|
|
(1,502
|
)
|
|
|
50,395
|
|
Commercial lease transactions (1)
|
|
|
1,524,226
|
|
|
|
23,270
|
|
|
|
24,092
|
|
|
|
1,571,588
|
|
|
|
(5,283
|
)
|
|
|
(3,947
|
)
|
|
|
(9,230
|
)
|
|
|
1,562,358
|
|
Other loans and accounts receivable
|
|
|
72,163
|
|
|
|
382
|
|
|
|
8,367
|
|
|
|
80,912
|
|
|
|
(1,543
|
)
|
|
|
(6,579
|
)
|
|
|
(8,122
|
)
|
|
|
72,790
|
|
Subtotal
|
|
|
14,982,585
|
|
|
|
94,893
|
|
|
|
353,014
|
|
|
|
15,430,492
|
|
|
|
(163,204
|
)
|
|
|
(126,755
|
)
|
|
|
(289,959
|
)
|
|
|
15,140,533
|
|
Mortgage loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Letters of credit
|
|
|
19,820
|
|
|
|
—
|
|
|
|
1,552
|
|
|
|
21,372
|
|
|
|
—
|
|
|
|
(5
|
)
|
|
|
(5
|
)
|
|
|
21,367
|
|
Endorsable mortgage loans
|
|
|
40,790
|
|
|
|
—
|
|
|
|
1,474
|
|
|
|
42,264
|
|
|
|
—
|
|
|
|
(29
|
)
|
|
|
(29
|
)
|
|
|
42,235
|
|
Other residential lending
|
|
|
7,816,433
|
|
|
|
—
|
|
|
|
157,416
|
|
|
|
7,973,849
|
|
|
|
—
|
|
|
|
(26,245
|
)
|
|
|
(26,245
|
)
|
|
|
7,947,604
|
|
Credit from ANAP
|
|
|
6
|
|
|
|
—
|
|
|
|
—
|
|
|
|
6
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
6
|
|
Residential lease transactions
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Other loans and accounts receivable
|
|
|
9,949
|
|
|
|
—
|
|
|
|
268
|
|
|
|
10,217
|
|
|
|
—
|
|
|
|
(167
|
)
|
|
|
(167
|
)
|
|
|
10,050
|
|
Subtotal
|
|
|
7,886,998
|
|
|
|
—
|
|
|
|
160,710
|
|
|
|
8,047,708
|
|
|
|
—
|
|
|
|
(26,446
|
)
|
|
|
(26,446
|
)
|
|
|
8,021,262
|
|
Consumer loans
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consumer loans in installments
|
|
|
2,711,285
|
|
|
|
—
|
|
|
|
246,207
|
|
|
|
2,957,492
|
|
|
|
—
|
|
|
|
(231,753
|
)
|
|
|
(231,753
|
)
|
|
|
2,725,739
|
|
Current account debtors
|
|
|
310,344
|
|
|
|
—
|
|
|
|
2,401
|
|
|
|
312,745
|
|
|
|
—
|
|
|
|
(13,870
|
)
|
|
|
(13,870
|
)
|
|
|
298,875
|
|
Credit card debtors
|
|
|
1,145,106
|
|
|
|
—
|
|
|
|
19,958
|
|
|
|
1,165,064
|
|
|
|
—
|
|
|
|
(44,579
|
)
|
|
|
(44,579
|
)
|
|
|
1,120,485
|
|
Consumer lease transactions (1)
|
|
|
9
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9
|
|
Other loans and accounts receivable
|
|
|
8
|
|
|
|
—
|
|
|
|
804
|
|
|
|
812
|
|
|
|
—
|
|
|
|
(492
|
)
|
|
|
(492
|
)
|
|
|
320
|
|
Subtotal
|
|
|
4,166,752
|
|
|
|
—
|
|
|
|
269,370
|
|
|
|
4,436,122
|
|
|
|
—
|
|
|
|
(290,694
|
)
|
|
|
(290,694
|
)
|
|
|
4,145,428
|
|
Total
|
|
|
27,036,335
|
|
|
|
94,893
|
|
|
|
783,094
|
|
|
|
27,914,322
|
|
|
|
(163,204
|
)
|
|
|
(443,895
|
)
|
|
|
(607,099
|
)
|
|
|
27,307,223
|
|
|
(1)
|
In this item, the Bank finances its customers purchases
of assets, including real estate and other personal property, through finance lease agreements. As of December 31, 2018 Ch$758,772
million correspond to finance leases for real estate and Ch$812,825 million correspond to finance leases for movable assets.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
12.
|
Loans to Customers, net, continued:
|
|
(a.ii)
|
Impaired Portfolio:
|
As
of June 30, 2019 and December 31, 2018, the Bank presents the following details of normal and impaired portfolio:
|
|
Assets
before Allowances
|
|
|
Allowances
established
|
|
|
|
Normal
Portfolio
|
|
|
Impaired
Portfolio
|
|
|
Total
|
|
|
Individual
Provisions
|
|
|
Group
Provisions
|
|
|
Total
|
|
|
Net
assets
|
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Commercial
loans
|
|
|
15,461,242
|
|
|
|
15,075,493
|
|
|
|
377,885
|
|
|
|
354,999
|
|
|
|
15,839,127
|
|
|
|
15,430,492
|
|
|
|
(164,095
|
)
|
|
|
(163,204
|
)
|
|
|
(131,564
|
)
|
|
|
(126,755
|
)
|
|
|
(295,659
|
)
|
|
|
(289,959
|
)
|
|
|
15,543,468
|
|
|
|
15,140,533
|
|
Mortgage loans
|
|
|
8,373,626
|
|
|
|
7,886,998
|
|
|
|
165,348
|
|
|
|
160,710
|
|
|
|
8,538,974
|
|
|
|
8,047,708
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(26,012
|
)
|
|
|
(26,446
|
)
|
|
|
(26,012
|
)
|
|
|
(26,446
|
)
|
|
|
8,512,962
|
|
|
|
8,021,262
|
|
Consumer
loans
|
|
|
4,190,775
|
|
|
|
4,166,752
|
|
|
|
264,933
|
|
|
|
269,370
|
|
|
|
4,455,708
|
|
|
|
4,436,122
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(306,538
|
)
|
|
|
(290,694
|
)
|
|
|
(306,538
|
)
|
|
|
(290,694
|
)
|
|
|
4,149,170
|
|
|
|
4,145,428
|
|
Total
|
|
|
28,025,643
|
|
|
|
27,129,243
|
|
|
|
808,166
|
|
|
|
785,079
|
|
|
|
28,833,809
|
|
|
|
27,914,322
|
|
|
|
(164,095
|
)
|
|
|
(163,204
|
)
|
|
|
(464,114
|
)
|
|
|
(443,895
|
)
|
|
|
(628,209
|
)
|
|
|
(607,099
|
)
|
|
|
28,205,600
|
|
|
|
27,307,223
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
12.
|
Loans to Customers, continued:
|
|
(b)
|
Credit risk provisions:
|
The
changes in credits risk provisions, during the periods 2019 and 2018, are summarized as follows:
|
|
Commercial
|
|
|
Mortgage
|
|
|
Consumer
|
|
|
|
|
|
|
Individual
|
|
|
Group
|
|
|
Group
|
|
|
Group
|
|
|
Total
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of December 31, 2017
|
|
|
176,178
|
|
|
|
107,297
|
|
|
|
31,764
|
|
|
|
242,943
|
|
|
|
558,182
|
|
Charge-offs
|
|
|
(4,715
|
)
|
|
|
(24,943
|
)
|
|
|
(3,156
|
)
|
|
|
(112,473
|
)
|
|
|
(145,287
|
)
|
Sales or transfers of credits
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Allowances established
|
|
|
573
|
|
|
|
29,679
|
|
|
|
—
|
|
|
|
117,320
|
|
|
|
147,572
|
|
Allowances released
|
|
|
—
|
|
|
|
—
|
|
|
|
(408
|
)
|
|
|
—
|
|
|
|
(408
|
)
|
Balance as of June 30, 2018
|
|
|
172,036
|
|
|
|
112,033
|
|
|
|
28,200
|
|
|
|
247,790
|
|
|
|
560,059
|
|
Charge-offs
|
|
|
(1,035
|
)
|
|
|
(21,726
|
)
|
|
|
(3,837
|
)
|
|
|
(121,038
|
)
|
|
|
(147,636
|
)
|
Sales or transfers of credits
|
|
|
(2,144
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(2,144
|
)
|
Allowances established
|
|
|
—
|
|
|
|
36,448
|
|
|
|
2,083
|
|
|
|
163,942
|
|
|
|
202,473
|
|
Allowances released
|
|
|
(5,653
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(5,653
|
)
|
Balance as of December 31, 2018
|
|
|
163,204
|
|
|
|
126,755
|
|
|
|
26,446
|
|
|
|
290,694
|
|
|
|
607,099
|
|
Charge-offs
|
|
|
(4,738
|
)
|
|
|
(22,505
|
)
|
|
|
(4,248
|
)
|
|
|
(123,892
|
)
|
|
|
(155,383
|
)
|
Sales or transfers of credits
|
|
|
(2,549
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(2,549
|
)
|
Allowances established
|
|
|
8,178
|
|
|
|
27,314
|
|
|
|
3,814
|
|
|
|
139,736
|
|
|
|
179,042
|
|
Allowances released
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Balance as of June 30, 2019
|
|
|
164,095
|
|
|
|
131,564
|
|
|
|
26,012
|
|
|
|
306,538
|
|
|
|
628,209
|
|
In
addition to these credit risk provisions, also provisions are maintained for country risk to cover foreign operations and additional
loan provisions agreed upon by the Board of Directors, which are presented in liabilities under the item Provisions (Note No. 24).
Other
disclosures:
|
1.
|
As of June 30, 2019 and December 2018, the Bank and
its subsidiaries have made purchases and sales of loan portfolios. The effect in income is no more than 5% of net income before
taxes, as described in Note No. 12 (d) and (e).
|
|
2.
|
As of June 30, 2019 and December 2018, the Bank and
its subsidiaries derecognized 100% of its portfolio of loans sold and on which all or substantially all of the risks and benefits
associated to these financial assets have been transferred (see Note No. 12 letter (e)).
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
12.
|
Loans to Customers, continued:
|
|
(c)
|
Finance lease contracts:
|
The cash flows to be received
by the Bank from finance lease contracts have the following maturities:
|
|
Total receivable
|
|
|
Unearned income
|
|
|
Net balance receivable (*)
|
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Within one year
|
|
|
547,846
|
|
|
|
519,186
|
|
|
|
(61,925
|
)
|
|
|
(60,216
|
)
|
|
|
485,921
|
|
|
|
458,970
|
|
From 1 to 2 years
|
|
|
394,162
|
|
|
|
383,164
|
|
|
|
(44,580
|
)
|
|
|
(44,066
|
)
|
|
|
349,582
|
|
|
|
339,098
|
|
From 2 to 3 years
|
|
|
260,832
|
|
|
|
255,997
|
|
|
|
(28,858
|
)
|
|
|
(28,740
|
)
|
|
|
231,974
|
|
|
|
227,257
|
|
From 3 to 4 years
|
|
|
168,353
|
|
|
|
162,310
|
|
|
|
(19,345
|
)
|
|
|
(19,471
|
)
|
|
|
149,008
|
|
|
|
142,839
|
|
From 4 to 5 years
|
|
|
108,981
|
|
|
|
108,453
|
|
|
|
(13,702
|
)
|
|
|
(13,992
|
)
|
|
|
95,279
|
|
|
|
94,461
|
|
After 5 years
|
|
|
333,248
|
|
|
|
336,705
|
|
|
|
(31,994
|
)
|
|
|
(33,666
|
)
|
|
|
301,254
|
|
|
|
303,039
|
|
Total
|
|
|
1,813,422
|
|
|
|
1,765,815
|
|
|
|
(200,404
|
)
|
|
|
(200,151
|
)
|
|
|
1,613,018
|
|
|
|
1,565,664
|
|
|
(*)
|
The net balance receivable does not include past-due portfolio
totaling Ch$8,883 million as of June 30, 2019 (Ch$5,933 million as of December 2018).
|
The Bank maintains financial
lease operations associated with real estate, industrial machinery, vehicles and transportation equipment. These leases contracts
have an average term between 2 and 15 years.
|
(d)
|
Purchase of loan portfolio:
|
During
the period ended June 30, 2019 the Bank has not acquired portfolio loans.
During
the year 2018, the Bank acquired portfolio loans, whose nominal value amounted to Ch$36,919 million.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
12.
|
Loans to Customers, continued:
|
|
(e)
|
Sale or transfer of loans from the loan portfolio:
|
During
the periods 2019 and 2018 there have been operations of sale or transfer of of the loan portfolio according to the following:
|
|
As of June 30, 2019
|
|
|
|
Carrying amount
|
|
|
Allowances
|
|
|
Sale price
|
|
|
Effect on income
(loss) gain
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sale of current loans
|
|
|
12,420
|
|
|
|
(2,549
|
)
|
|
|
12,420
|
|
|
|
2,549
|
|
Sale of written – off loans
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Total
|
|
|
12,420
|
|
|
|
(2,549
|
)
|
|
|
12,420
|
|
|
|
2,549
|
|
|
|
As of June 30, 2018
|
|
|
|
Carrying amount
|
|
|
Allowances
|
|
|
Sale price
|
|
|
Effect on income
(loss) gain
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sale of current loans
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Sale of written – off loans
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Total
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
(f)
|
Securitization of own assets:
|
During
the period 2019 and the year 2018, there is no securitization transactions executed involving its own assets.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
13.
|
Investment Securities:
|
As
of June 30, 2019 and December 31, 2018, investment securities classified as available-for-sale and held-to-maturity are detailed
as follows
:
|
|
June 2019
|
|
|
December 2018
|
|
|
|
Available-
for-sale
|
|
|
Held-to- maturity
|
|
|
Total
|
|
|
Available-
for-sale
|
|
|
Held-to- maturity
|
|
|
Total
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Instruments issued by the Chilean Government and Central Bank of Chile
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bonds issued by the Central Bank of Chile
|
|
|
87,702
|
|
|
|
—
|
|
|
|
87,702
|
|
|
|
135,145
|
|
|
|
—
|
|
|
|
135,145
|
|
Promissory notes issued by the Central Bank of Chile
|
|
|
16,226
|
|
|
|
—
|
|
|
|
16,226
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Other instruments of the Chilean Government and the Central Bank of Chile
|
|
|
22,722
|
|
|
|
—
|
|
|
|
22,722
|
|
|
|
29,077
|
|
|
|
—
|
|
|
|
29,077
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other instruments issued in Chile
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposit promissory notes from domestics banks
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Mortgage bonds from domestic banks
|
|
|
99,965
|
|
|
|
—
|
|
|
|
99,965
|
|
|
|
92,491
|
|
|
|
—
|
|
|
|
92,491
|
|
Bonds from domestic banks
|
|
|
6,749
|
|
|
|
—
|
|
|
|
6,749
|
|
|
|
5,351
|
|
|
|
—
|
|
|
|
5,351
|
|
Deposits from domestic banks
|
|
|
907,974
|
|
|
|
—
|
|
|
|
907,974
|
|
|
|
559,108
|
|
|
|
—
|
|
|
|
559,108
|
|
Bonds from other Chilean companies
|
|
|
1,653
|
|
|
|
—
|
|
|
|
1,653
|
|
|
|
6,599
|
|
|
|
—
|
|
|
|
6,599
|
|
Promissory notes issued by other Chilean companies
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Other instruments issued in Chile
|
|
|
82,066
|
|
|
|
—
|
|
|
|
82,066
|
|
|
|
107,125
|
|
|
|
—
|
|
|
|
107,125
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Instruments issued Abroad
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Instruments from foreign governments or Central Banks
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Other instruments
|
|
|
18,120
|
|
|
|
—
|
|
|
|
18,120
|
|
|
|
108,544
|
|
|
|
—
|
|
|
|
108,544
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
1,243,177
|
|
|
|
—
|
|
|
|
1,243,177
|
|
|
|
1,043,440
|
|
|
|
—
|
|
|
|
1,043,440
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
13.
|
Investment Securities, continued:
|
Instruments
issued by the Chilean Government and Central Bank include instruments with repurchase agreements sold to clients and financial
institutions, totaling Ch$6,965 million as of December 2018. The repurchase agreements have an average maturity of 3 days as of
December 2018. As of June 30, 2019, there is no amount for this concept.
Under
the instruments issued abroad mainly include bonds of local companies issued abroad.
As of June 30, 2019,
the portfolio of financial assets available-for-sale includes an accumulated unrealized gain of Ch$7,741 million (accumulated unrealized
losses of Ch$9,936 million in December 2018), recorded as an equity valuation adjustment.
During
the period 2019 and 2018, there is no evidence of impairment of financial assets available-for-sale.
Gross profits and losses
realized on the sale of available-for-sale investments as of June 30, 2019 and 2018 are shown in Note No. 30 “Net Financial
Operating Income”. The changes on results at the end of each period are as fallow:
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Unrealized (losses) gains
|
|
|
20,751
|
|
|
|
(4,938
|
)
|
Realized losses (gains) reclassified to income
|
|
|
(3,074
|
)
|
|
|
(1,244
|
)
|
Subtotal
|
|
|
17,677
|
|
|
|
(6,182
|
)
|
Income tax on other comprehensive income
|
|
|
(4,778
|
)
|
|
|
1,667
|
|
Net effect in equity
|
|
|
12,899
|
|
|
|
(4,515
|
)
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
14.
|
Investments in Other Companies:
|
|
(a)
|
Investments in other companies include investments
of Ch$47,694, million as of June 30, 2019 (Ch$44,561 million as of December 31, 2018), as follows:
|
|
|
|
|
|
|
|
|
|
|
Investment
|
|
|
|
|
|
Ownership Interest
|
|
|
Equity
|
|
|
Book Value
|
|
|
Income (Loss)
|
|
|
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
June
|
|
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
Company
|
|
Shareholder
|
|
%
|
|
|
%
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Associates
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transbank S.A.
|
|
Banco de Chile
|
|
|
26.16
|
|
|
|
26.16
|
|
|
|
79,125
|
|
|
|
69,358
|
|
|
|
20,697
|
|
|
|
18,468
|
|
|
|
2,228
|
|
|
|
1,985
|
|
Soc. Operadora de Tarjetas de Crédito Nexus S.A.
|
|
Banco de Chile
|
|
|
25.81
|
|
|
|
25.81
|
|
|
|
19,033
|
|
|
|
16,805
|
|
|
|
4,912
|
|
|
|
4,557
|
|
|
|
355
|
|
|
|
657
|
|
Administrador Financiero del Transantiago S.A.
|
|
Banco de Chile
|
|
|
20.00
|
|
|
|
20.00
|
|
|
|
18,695
|
|
|
|
17,978
|
|
|
|
3,739
|
|
|
|
3,680
|
|
|
|
143
|
|
|
|
118
|
|
Redbanc S.A.
|
|
Banco de Chile
|
|
|
38.13
|
|
|
|
38.13
|
|
|
|
8,924
|
|
|
|
8,356
|
|
|
|
3,403
|
|
|
|
3,219
|
|
|
|
184
|
|
|
|
262
|
|
Centro de Compensación Automatizado S.A.
|
|
Banco de Chile
|
|
|
33.33
|
|
|
|
33.33
|
|
|
|
6,148
|
|
|
|
5,592
|
|
|
|
2,049
|
|
|
|
1,894
|
|
|
|
159
|
|
|
|
118
|
|
Sociedad Imerc OTC S.A.
|
|
Banco de Chile
|
|
|
12.33
|
|
|
|
12.33
|
|
|
|
12,201
|
|
|
|
11,952
|
|
|
|
1,505
|
|
|
|
1,474
|
|
|
|
26
|
|
|
|
40
|
|
Sociedad Interbancaria de Depósitos de Valores S.A.
|
|
Banco de Chile
|
|
|
26.81
|
|
|
|
26.81
|
|
|
|
4,511
|
|
|
|
4,161
|
|
|
|
1,209
|
|
|
|
1,129
|
|
|
|
78
|
|
|
|
96
|
|
Sociedad Operadora de la Cámara de Compensación de Pagos de Alto Valor S.A.
|
|
Banco de Chile
|
|
|
15.00
|
|
|
|
15.00
|
|
|
|
6,314
|
|
|
|
6,106
|
|
|
|
947
|
|
|
|
944
|
|
|
|
17
|
|
|
|
32
|
|
Subtotal Associates
|
|
|
|
|
|
|
|
|
|
|
|
|
154,951
|
|
|
|
140,308
|
|
|
|
38,461
|
|
|
|
35,365
|
|
|
|
3,190
|
|
|
|
3,308
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Joint Ventures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Servipag Ltda.
|
|
Banco de Chile
|
|
|
50.00
|
|
|
|
50.00
|
|
|
|
11,826
|
|
|
|
11,398
|
|
|
|
5,913
|
|
|
|
5,699
|
|
|
|
214
|
|
|
|
298
|
|
Artikos Chile S.A.
|
|
Banco de Chile
|
|
|
50.00
|
|
|
|
50.00
|
|
|
|
2,026
|
|
|
|
2,025
|
|
|
|
1,013
|
|
|
|
1,188
|
|
|
|
251
|
|
|
|
210
|
|
Subtotal Joint Ventures
|
|
|
|
|
|
|
|
|
|
|
|
|
13,852
|
|
|
|
13,423
|
|
|
|
6,926
|
|
|
|
6,887
|
|
|
|
465
|
|
|
|
508
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal
|
|
|
|
|
|
|
|
|
|
|
|
|
168,803
|
|
|
|
153,731
|
|
|
|
45,387
|
|
|
|
42,252
|
|
|
|
3,655
|
|
|
|
3,816
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments valued
at cost (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Bolsa de Comercio de Santiago S.A.
|
|
Banchile Corredores de Bolsa
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,646
|
|
|
|
1,646
|
|
|
|
277
|
|
|
|
305
|
|
Banco Latinoamericano de Comercio Exterior S.A. (Bladex)
|
|
Banco de Chile
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
309
|
|
|
|
309
|
|
|
|
31
|
|
|
|
27
|
|
Bolsa Electrónica de Chile S.A.
|
|
Banchile Corredores de Bolsa
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
257
|
|
|
|
257
|
|
|
|
9
|
|
|
|
—
|
|
Sociedad de Telecomunicaciones Financieras Interbancarias Mundiales (Swift)
|
|
Banco de Chile
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
87
|
|
|
|
89
|
|
|
|
—
|
|
|
|
—
|
|
CCLV Contraparte Central S.A.
|
|
Banchile Corredores de Bolsa
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8
|
|
|
|
8
|
|
|
|
1
|
|
|
|
—
|
|
Subtotal
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,307
|
|
|
|
2,309
|
|
|
|
318
|
|
|
|
332
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
47,694
|
|
|
|
44,561
|
|
|
|
3,973
|
|
|
|
4,148
|
|
|
(1)
|
Income from investments
valorized at cost, corresponds to income recognized on cash basis (dividends).
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
14
.
|
Investments in Other Companies, continued:
|
|
(b)
|
The change of investments in companies registered under
the equity method in the periods of June2019 and 2018, are as follows:
|
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Initial book value
|
|
|
42,252
|
|
|
|
35,771
|
|
Acquisition of investments in companies
|
|
|
—
|
|
|
|
—
|
|
Participation on income in companies with significant influence and joint control
|
|
|
3,655
|
|
|
|
3,816
|
|
Dividends receivable
|
|
|
—
|
|
|
|
—
|
|
Dividends Minimum
|
|
|
—
|
|
|
|
136
|
|
Dividends received
|
|
|
(553
|
)
|
|
|
(411
|
)
|
Others
|
|
|
33
|
|
|
|
3
|
|
Total
|
|
|
45,387
|
|
|
|
39,315
|
|
|
(c)
|
During the period ended as of June 30, 2019 and December
31, 2018 no impairment has incurred in these investments.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
(a)
|
As of June 30, 2019 and December 31, 2018 intangible
assets are detailed as follows:
|
|
|
Useful Life
|
|
|
Average remaining amortization
|
|
|
Gross balance
|
|
|
Accumulated Amortization
|
|
|
Net balance
|
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
Years
|
|
|
Years
|
|
|
Years
|
|
|
Years
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Intangible Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Software or computer programs
|
|
|
6
|
|
|
|
6
|
|
|
|
5
|
|
|
|
5
|
|
|
|
152,819
|
|
|
|
144,942
|
|
|
|
(98,396
|
)
|
|
|
(92,881
|
)
|
|
|
54,423
|
|
|
|
52,061
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
152,819
|
|
|
|
144,942
|
|
|
|
(98,396
|
)
|
|
|
(92,881
|
)
|
|
|
54,423
|
|
|
|
52,061
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
15.
|
Intangible Assets, continued:
|
|
(b)
|
The change of intangible assets as of June 30, 2019
and December 31, 2018 are as follows:
|
|
|
June 2019
|
|
|
|
Software or computer programs
|
|
|
|
MCh$
|
|
Gross Balance
|
|
|
|
|
Balance as of January 1, 2019
|
|
|
144,942
|
|
Acquisition
|
|
|
8,469
|
|
Disposals/ write-downs
|
|
|
(316
|
)
|
Reclassification
|
|
|
(276
|
)
|
Total
|
|
|
152,819
|
|
|
|
|
|
|
Accumulated Amortization
|
|
|
|
|
Balance as of January 1, 2019
|
|
|
(92,881
|
)
|
Amortization for the period (*)
|
|
|
(6,093
|
)
|
Disposals/ write-downs
|
|
|
316
|
|
Reclassification
|
|
|
262
|
|
Total
|
|
|
(98,396
|
)
|
|
|
|
|
|
Balance as of June 30, 2019
|
|
|
54,423
|
|
|
|
December 2018
|
|
|
|
Software or computer programs
|
|
|
|
MCh$
|
|
Gross Balance
|
|
|
|
Balance as of January 1, 2018
|
|
|
122,454
|
|
Acquisition
|
|
|
23,512
|
|
Disposals/ write-downs
|
|
|
(1,024
|
)
|
Total
|
|
|
144,942
|
|
|
|
|
|
|
Accumulated Amortization
|
|
|
|
|
Balance as of January 1, 2018
|
|
|
(83,409
|
)
|
Amortization for the year
|
|
|
(10,496
|
)
|
Disposals/ write-downs
|
|
|
1,024
|
|
Total
|
|
|
(92,881
|
)
|
|
|
|
|
|
Balance as of December 31, 2018
|
|
|
52,061
|
|
|
(*)
|
See Note No. 35 Depreciation, amortization and impairment.
|
|
(c)
|
As of June 30, 2019 and December 31, 2018, the Bank
maintains the following amounts with technological developments:
|
|
|
Commitment Amount
|
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
Detail
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
Software and licenses
|
|
|
5,828
|
|
|
|
11,806
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
16.
|
Fixed assets, leased assets and lease liabilities:
|
|
(a)
|
The properties and equipment as of June 30, 2019 and
December 31, 2018 are composed as follows:
|
|
|
Useful Life
|
|
|
Average remaining depreciation
|
|
|
Gross balance
|
|
|
Accumulated Depreciation
|
|
|
Net balance
|
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
Years
|
|
|
Years
|
|
|
Years
|
|
|
Years
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Type of property and equipment:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Land and Buildings
|
|
|
26
|
|
|
|
26
|
|
|
|
21
|
|
|
|
21
|
|
|
|
320,825
|
|
|
|
320,585
|
|
|
|
(153,416
|
)
|
|
|
(150,099
|
)
|
|
|
167,409
|
|
|
|
170,486
|
|
Equipment
|
|
|
5
|
|
|
|
5
|
|
|
|
4
|
|
|
|
3
|
|
|
|
197,793
|
|
|
|
183,220
|
|
|
|
(156,209
|
)
|
|
|
(148,455
|
)
|
|
|
41,584
|
|
|
|
34,765
|
|
Others
|
|
|
7
|
|
|
|
7
|
|
|
|
4
|
|
|
|
4
|
|
|
|
53,947
|
|
|
|
53,500
|
|
|
|
(44,415
|
)
|
|
|
(42,879
|
)
|
|
|
9,532
|
|
|
|
10,621
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
572,565
|
|
|
|
557,305
|
|
|
|
(354,040
|
)
|
|
|
(341,433
|
)
|
|
|
218,525
|
|
|
|
215,872
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
16.
|
Fixed assets, leased assets and lease liabilities, continued:
|
|
(b)
|
The changes in properties and equipment as of June
30, 2019 and December 31, 2018 are as follows:
|
|
|
June 2019
|
|
|
|
Land and Buildings
|
|
|
Equipment
|
|
|
Others
|
|
|
Total
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Gross Balance
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of January 1, 2019
|
|
|
320,585
|
|
|
|
183,220
|
|
|
|
53,500
|
|
|
|
557,305
|
|
Reclassification
|
|
|
(2,555
|
)
|
|
|
(37
|
)
|
|
|
—
|
|
|
|
(2,592
|
)
|
Additions
|
|
|
2,795
|
|
|
|
15,218
|
|
|
|
608
|
|
|
|
18,621
|
|
Disposals/write-downs/Sales
|
|
|
—
|
|
|
|
(608
|
)
|
|
|
(154
|
)
|
|
|
(762
|
)
|
Impairment losses (*) (***)
|
|
|
—
|
|
|
|
—
|
|
|
|
(7
|
)
|
|
|
(7
|
)
|
Total
|
|
|
320,825
|
|
|
|
197,793
|
|
|
|
53,947
|
|
|
|
572,565
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated Depreciation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of January 1, 2019
|
|
|
(150,099
|
)
|
|
|
(148,455
|
)
|
|
|
(42,879
|
)
|
|
|
(341,433
|
)
|
Reclassification
|
|
|
1,108
|
|
|
|
37
|
|
|
|
—
|
|
|
|
1,145
|
|
Depreciation charges of the period (*) (**)
|
|
|
(4,425
|
)
|
|
|
(8,382
|
)
|
|
|
(1,694
|
)
|
|
|
(14,501
|
)
|
Sales and disposals of the period
|
|
|
—
|
|
|
|
591
|
|
|
|
158
|
|
|
|
749
|
|
Total
|
|
|
(153,416
|
)
|
|
|
(156,209
|
)
|
|
|
(44,415
|
)
|
|
|
(354,040
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of June 30, 2019
|
|
|
167,409
|
|
|
|
41,584
|
|
|
|
9,532
|
|
|
|
218,525
|
|
|
|
December 2018
|
|
|
|
Land and Buildings
|
|
|
Equipment
|
|
|
Others
|
|
|
Total
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Gross Balance
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of January 1, 2018
|
|
|
311,428
|
|
|
|
184,369
|
|
|
|
52,552
|
|
|
|
548,349
|
|
Reclassification
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Additions
|
|
|
12,589
|
|
|
|
12,702
|
|
|
|
2,774
|
|
|
|
28,065
|
|
Disposals/write-downs/Sales
|
|
|
(3,145
|
)
|
|
|
(13,845
|
)
|
|
|
(1,785
|
)
|
|
|
(18,775
|
)
|
Impairment losses
|
|
|
(287
|
)
|
|
|
(6
|
)
|
|
|
(41
|
)
|
|
|
(334
|
)
|
Total
|
|
|
320,585
|
|
|
|
183,220
|
|
|
|
53,500
|
|
|
|
557,305
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated Depreciation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of January 1, 2018
|
|
|
(142,768
|
)
|
|
|
(148,006
|
)
|
|
|
(41,316
|
)
|
|
|
(332,090
|
)
|
Depreciation charges of the year (**)
|
|
|
(9,193
|
)
|
|
|
(14,291
|
)
|
|
|
(3,333
|
)
|
|
|
(26,817
|
)
|
Sales and disposals of the year
|
|
|
1,862
|
|
|
|
13,842
|
|
|
|
1,770
|
|
|
|
17,474
|
|
Total
|
|
|
(150,099
|
)
|
|
|
(148,455
|
)
|
|
|
(42,879
|
)
|
|
|
(341,433
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of December 31, 2018
|
|
|
170,486
|
|
|
|
34,765
|
|
|
|
10,621
|
|
|
|
215,872
|
|
|
(*)
|
See Note No.35 Depreciation, Amortization and Impairment.
|
|
(**)
|
This amount does not include the depreciation of the year
of the Investment Properties, amount is included in “Other Assets” for Ch$180 million (Ch$368 million as of December
31, 2018).
|
|
(***)
|
This amount does not include charge-offs provision of Property
and Equipment of Ch$815 million.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
16.
|
Fixed assets, leased assets and lease liabilities, continued:
|
|
(c)
|
The composition of the rights over leased assets as
of June 30, 2019, is as follows:
|
|
|
Gross
Balance
|
|
|
Accumulated Depreciation
|
|
|
Net
Balance
|
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2019
|
|
|
2019
|
|
Categories
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
Buildings
|
|
|
127,106
|
|
|
|
(9,164
|
)
|
|
|
117,942
|
|
ATMs
|
|
|
41,438
|
|
|
|
(4,550
|
)
|
|
|
36,888
|
|
Improvements to leased properties
|
|
|
3,035
|
|
|
|
(1,194
|
)
|
|
|
1,841
|
|
Total
|
|
|
171,579
|
|
|
|
(14,908
|
)
|
|
|
156,671
|
|
|
(d)
|
The changes of the rights over leased assets as of
June 30, 2019, is as follows
|
|
|
June 2019
|
|
|
|
Buildings
|
|
|
ATMs
|
|
|
Improvements to leased properties
|
|
|
Total
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Balance
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of January 1, 2019
|
|
|
116,609
|
|
|
|
27,920
|
|
|
|
—
|
|
|
|
144,529
|
|
Reclassification
|
|
|
—
|
|
|
|
—
|
|
|
|
3,071
|
|
|
|
3,071
|
|
Additions
|
|
|
10,381
|
|
|
|
13,518
|
|
|
|
181
|
|
|
|
24,080
|
|
Write-downs
|
|
|
—
|
|
|
|
—
|
|
|
|
(217
|
)
|
|
|
(217
|
)
|
Others
|
|
|
116
|
|
|
|
—
|
|
|
|
—
|
|
|
|
116
|
|
Total
|
|
|
127,106
|
|
|
|
41,438
|
|
|
|
3,035
|
|
|
|
171,579
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated Depreciation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of January 1, 2019
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Reclassification
|
|
|
—
|
|
|
|
—
|
|
|
|
(1,234
|
)
|
|
|
(1,234
|
)
|
Depreciation of the period (*)
|
|
|
(9,164
|
)
|
|
|
(4,550
|
)
|
|
|
(177
|
)
|
|
|
(13,891
|
)
|
Write-downs
|
|
|
—
|
|
|
|
—
|
|
|
|
217
|
|
|
|
217
|
|
Total
|
|
|
(9,164
|
)
|
|
|
(4,550
|
)
|
|
|
(1,194
|
)
|
|
|
(14,908
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of June 30, 2019
|
|
|
117,942
|
|
|
|
36,888
|
|
|
|
1,841
|
|
|
|
156,671
|
|
|
(*)
|
See Note No.35 Depreciation, Amortization and Impairment.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
16.
|
Fixed assets, leased assets and lease liabilities, continued:
|
|
(e)
|
The following are the future maturities of the lease
liabilities as of June 30, 2019:
|
|
|
Up to 1 month
|
|
|
Over 1 month and up to 3 months
|
|
|
Over 3 months and up to 12 months
|
|
|
Over 1 year and up to 3 years
|
|
|
Over 3 years and up to 5 years
|
|
|
Over 5 years
|
|
|
Total
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Lease associated with:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Buildings
|
|
|
1,700
|
|
|
|
3,432
|
|
|
|
15,313
|
|
|
|
39,550
|
|
|
|
26,553
|
|
|
|
42,094
|
|
|
|
128,642
|
|
ATMs
|
|
|
798
|
|
|
|
1,596
|
|
|
|
7,182
|
|
|
|
18,129
|
|
|
|
9,622
|
|
|
|
1,179
|
|
|
|
38,506
|
|
Total
|
|
|
2,498
|
|
|
|
5,028
|
|
|
|
22,495
|
|
|
|
57,679
|
|
|
|
36,175
|
|
|
|
43,273
|
|
|
|
167,148
|
|
The
Bank and its subsidiaries maintain contracts with certain renewal options and for which there is reasonable certainty that said
option shall be carried out. In such cases, the lease period used to measure the liability and assets corresponds to an estimate
of future renewals.
The
changes of the period of obligations under capitalized leases and period flows are as follows:
|
|
Total cash flow
for the period
|
|
Lease liability
|
|
MCh$
|
|
|
|
|
|
Balances as of January 1, 2019
|
|
|
144,529
|
|
Liabilities for new lease agreements
|
|
|
22,238
|
|
Interest expenses
|
|
|
1,192
|
|
Payments of capital and interests
|
|
|
(14,332
|
)
|
Others
|
|
|
1,746
|
|
Balances as of June 30, 2019
|
|
|
155,373
|
|
|
(f)
|
The future cash flows related to short-term lease agreements
in effect as of June 30, 2019 correspond to Ch$10,017 million.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
17.
|
Current Taxes and Deferred Taxes:
|
The
Bank and its subsidiaries at the end of each period, have constituted a First Category Income Tax Provision, which was determined
based on current tax regulations, and has been reflected in the Statement of Financial Position net of taxes to be recovered or
payable, as applicable, as of June 30, 2019 and December 31, 2018, according to the following detail:
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Income tax
|
|
|
141,523
|
|
|
|
150,798
|
|
Less:
|
|
|
|
|
|
|
|
|
Monthly prepaid taxes
|
|
|
(66,107
|
)
|
|
|
(126,917
|
)
|
Credit for training expenses
|
|
|
(633
|
)
|
|
|
(2,224
|
)
|
Others
|
|
|
(782
|
)
|
|
|
(1,410
|
)
|
Total
|
|
|
74,001
|
|
|
|
20,247
|
|
|
|
|
|
|
|
|
|
|
Tax rate
|
|
|
27.0
|
%
|
|
|
27.0
|
%
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Current tax assets
|
|
|
388
|
|
|
|
677
|
|
Current tax liabilities
|
|
|
(74,389
|
)
|
|
|
(20,924
|
)
|
Total tax payable
|
|
|
(74,001
|
)
|
|
|
(20,247
|
)
|
The
effect of the tax expense during the periods between January 1 and June 30, 2019 and 2018, broken down as follows:
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
Income tax expense:
|
|
|
|
|
|
|
Current year tax
|
|
|
148,366
|
|
|
|
50,189
|
|
Tax Previous year
|
|
|
(16,347
|
)
|
|
|
2,574
|
|
Subtotal
|
|
|
132,019
|
|
|
|
52,763
|
|
(Credit) Charge for deferred taxes:
|
|
|
|
|
|
|
|
|
Origin and reversal of temporary differences
|
|
|
(46,728
|
)
|
|
|
8,711
|
|
Subtotal
|
|
|
(46,728
|
)
|
|
|
8,711
|
|
Others
|
|
|
(1,707
|
)
|
|
|
(942
|
)
|
Net charge to income for income taxes
|
|
|
83,584
|
|
|
|
60,532
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
17.
|
Current and Deferred Taxes, continued:
|
|
(c)
|
Reconciliation of effective tax rate:
|
The following is a reconciliation
of the income tax rate to the effective rate applied to determine the Bank’s income tax expense as of June 30, 2019 and 2018:
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
Tax rate
%
|
|
|
MCh$
|
|
|
Tax rate
%
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax calculated on net income before tax
|
|
|
27.00
|
|
|
|
101,857
|
|
|
|
27.00
|
|
|
|
98,751
|
|
Additions or deductions
|
|
|
(0.80
|
)
|
|
|
(3,025
|
)
|
|
|
(0.58
|
)
|
|
|
(2,111
|
)
|
Subordinated debt (*)
|
|
|
—
|
|
|
|
—
|
|
|
|
(5.60
|
)
|
|
|
(20,500
|
)
|
Price-level restatement
|
|
|
(4.03
|
)
|
|
|
(15,202
|
)
|
|
|
(4.38
|
)
|
|
|
(16,031
|
)
|
Other
|
|
|
(0.01
|
)
|
|
|
(46
|
)
|
|
|
0.11
|
|
|
|
423
|
|
Effective rate and income tax expense
|
|
|
22.16
|
|
|
|
83,584
|
|
|
|
16.55
|
|
|
|
60,532
|
|
|
(*)
|
The tax expense related to the subordinated debt held by
SAOS S.A, it ended during the current fiscal year 2018, as a result of the generation of sufficient resources to pay off the total
debt.
|
The effective rate for income
tax for the period 2019 is 22.16% (16.55% in June 2018).
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
17.
|
Current and Deferred Taxes, continued:
|
|
(d)
|
Effect of deferred taxes on income and equity:
|
The Bank and its subsidiaries
have recorded the effects of deferred taxes in their Financial Statements. The effects of deferred taxes on assets, liabilities
and income accounts are detailed as follows:
|
|
Balances as of
December 31,
|
|
|
Effect on
|
|
|
Balances as of
June 30,
|
|
|
|
2018
|
|
|
Income
|
|
|
Equity
|
|
|
2019
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Debit Differences:
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowances for loan losses
|
|
|
206,197
|
|
|
|
6,963
|
|
|
|
—
|
|
|
|
213,160
|
|
Personnel provisions
|
|
|
12,994
|
|
|
|
(3,063
|
)
|
|
|
—
|
|
|
|
9,931
|
|
Staff vacations
|
|
|
7,241
|
|
|
|
17
|
|
|
|
—
|
|
|
|
7,258
|
|
Accrued interests adjustments from impaired loans
|
|
|
3,232
|
|
|
|
388
|
|
|
|
—
|
|
|
|
3,620
|
|
Staff severance indemnities provision
|
|
|
600
|
|
|
|
(29
|
)
|
|
|
50
|
|
|
|
621
|
|
Provision of credit cards expenses
|
|
|
9,813
|
|
|
|
(1,369
|
)
|
|
|
—
|
|
|
|
8,444
|
|
Provision of accrued expenses
|
|
|
13,155
|
|
|
|
4,856
|
|
|
|
—
|
|
|
|
18,011
|
|
Adjustment for valuation of financial assets available-for-sale
|
|
|
2,695
|
|
|
|
—
|
|
|
|
(2,695
|
)
|
|
|
—
|
|
Leasing
|
|
|
42,988
|
|
|
|
908
|
|
|
|
—
|
|
|
|
43,896
|
|
Incomes received in advance
|
|
|
—
|
|
|
|
40,246
|
|
|
|
|
|
|
|
40,246
|
|
Other adjustments
|
|
|
12,392
|
|
|
|
2,336
|
|
|
|
—
|
|
|
|
14,728
|
|
Total Debit Differences
|
|
|
311,307
|
|
|
|
51,253
|
|
|
|
(2,645
|
)
|
|
|
359,915
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit Differences:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and price-level restatement of property and equipment
|
|
|
14,990
|
|
|
|
1,312
|
|
|
|
—
|
|
|
|
16,302
|
|
Adjustment for valuation of financial assets available-for-sale
|
|
|
—
|
|
|
|
—
|
|
|
|
2,083
|
|
|
|
2,083
|
|
Transitory assets
|
|
|
4,359
|
|
|
|
2,679
|
|
|
|
—
|
|
|
|
7,038
|
|
Loans accrued to effective rate
|
|
|
1,569
|
|
|
|
(58
|
)
|
|
|
—
|
|
|
|
1,511
|
|
Advance payment of lump-sum under union contracts
|
|
|
6,699
|
|
|
|
(1,796
|
)
|
|
|
—
|
|
|
|
4,903
|
|
Other adjustments
|
|
|
5,768
|
|
|
|
2,388
|
|
|
|
—
|
|
|
|
8,156
|
|
Total Credit Differences
|
|
|
33,385
|
|
|
|
4,525
|
|
|
|
2,083
|
|
|
|
39,993
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred, Net
|
|
|
277,922
|
|
|
|
46,728
|
|
|
|
(4,728
|
)
|
|
|
319,922
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
17.
|
Current and Deferred Taxes, continued:
|
|
(d)
|
Effect of deferred taxes on income and equity, continued:
|
The effects
of deferred taxes on assets, liabilities and income as of June 30, 2018 and December 31, 2018, are as follows:
|
|
Balance as of
December 31,
|
|
|
Effect on
|
|
|
Balance as of
June 30,
|
|
|
Effect on
|
|
|
Balance as of
December 31,
|
|
|
|
2017
|
|
|
Income
|
|
|
Equity
|
|
|
2018
|
|
|
Income
|
|
|
Equity
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Debit differences:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowances for loan losses
|
|
|
195,192
|
|
|
|
(948
|
)
|
|
|
—
|
|
|
|
194,244
|
|
|
|
11,953
|
|
|
|
—
|
|
|
|
206,197
|
|
Personnel provisions
|
|
|
12,238
|
|
|
|
(3,240
|
)
|
|
|
—
|
|
|
|
8,998
|
|
|
|
3,996
|
|
|
|
—
|
|
|
|
12,994
|
|
Staff vacations
|
|
|
6,908
|
|
|
|
(32
|
)
|
|
|
—
|
|
|
|
6,876
|
|
|
|
365
|
|
|
|
—
|
|
|
|
7,241
|
|
Accrued interest adjustments from impaired loans
|
|
|
3,414
|
|
|
|
(49
|
)
|
|
|
—
|
|
|
|
3,365
|
|
|
|
(133
|
)
|
|
|
—
|
|
|
|
3,232
|
|
Staff severance indemnities provision
|
|
|
573
|
|
|
|
(8
|
)
|
|
|
—
|
|
|
|
565
|
|
|
|
—
|
|
|
|
35
|
|
|
|
600
|
|
Provisions of credit card expenses
|
|
|
8,955
|
|
|
|
576
|
|
|
|
—
|
|
|
|
9,531
|
|
|
|
282
|
|
|
|
—
|
|
|
|
9,813
|
|
Provisions of accrued expenses
|
|
|
16,358
|
|
|
|
1,153
|
|
|
|
—
|
|
|
|
17,511
|
|
|
|
(4,356
|
)
|
|
|
—
|
|
|
|
13,155
|
|
Adjustment for valuation financial assets available-for-sale
|
|
|
—
|
|
|
|
—
|
|
|
|
1,168
|
|
|
|
1,168
|
|
|
|
—
|
|
|
|
1,527
|
|
|
|
2,695
|
|
Leasing
|
|
|
32,549
|
|
|
|
3,158
|
|
|
|
—
|
|
|
|
35,707
|
|
|
|
7,281
|
|
|
|
—
|
|
|
|
42,988
|
|
Other adjustments
|
|
|
17,372
|
|
|
|
1,407
|
|
|
|
—
|
|
|
|
18,779
|
|
|
|
(6,387
|
)
|
|
|
—
|
|
|
|
12,392
|
|
Total debit differences
|
|
|
293,559
|
|
|
|
2,017
|
|
|
|
1,168
|
|
|
|
296,744
|
|
|
|
13,001
|
|
|
|
1,562
|
|
|
|
311,307
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Credit differences:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation of property and equipment and investment properties
|
|
|
14,281
|
|
|
|
242
|
|
|
|
—
|
|
|
|
14,523
|
|
|
|
467
|
|
|
|
—
|
|
|
|
14,990
|
|
Adjustment for valuation financial assets available-for-sale
|
|
|
499
|
|
|
|
—
|
|
|
|
(499
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Transitory assets
|
|
|
4,331
|
|
|
|
1,937
|
|
|
|
—
|
|
|
|
6,268
|
|
|
|
(1,909
|
)
|
|
|
—
|
|
|
|
4,359
|
|
Loans accrued to effective rate
|
|
|
1,608
|
|
|
|
(92
|
)
|
|
|
—
|
|
|
|
1,516
|
|
|
|
53
|
|
|
|
—
|
|
|
|
1,569
|
|
Advance payment of lump-sum under union contracts
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
6,173
|
|
|
|
526
|
|
|
|
6,699
|
|
Other adjustments
|
|
|
5,440
|
|
|
|
8,641
|
|
|
|
—
|
|
|
|
14,081
|
|
|
|
(8,313
|
)
|
|
|
—
|
|
|
|
5,768
|
|
Total credit differences
|
|
|
26,159
|
|
|
|
10,728
|
|
|
|
(499
|
)
|
|
|
36,388
|
|
|
|
(3,529
|
)
|
|
|
526
|
|
|
|
33,385
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Assets (Liabilities) net
|
|
|
267,400
|
|
|
|
(8,711
|
)
|
|
|
1,667
|
|
|
|
260,356
|
|
|
|
16,530
|
|
|
|
1,036
|
|
|
|
277,922
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
At the end of each period, the
item is composed as follows:
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Assets held for leasing (*)
|
|
|
94,861
|
|
|
|
101,848
|
|
|
|
|
|
|
|
|
|
|
Assets received or awarded as payment (**)
|
|
|
|
|
|
|
|
|
Assets awarded at judicial sale
|
|
|
12,635
|
|
|
|
14,171
|
|
Assets received in lieu of payment
|
|
|
2,459
|
|
|
|
3,623
|
|
Provision for assets received in lieu of payment or awarded
|
|
|
(247
|
)
|
|
|
(806
|
)
|
Subtotal
|
|
|
14,847
|
|
|
|
16,988
|
|
|
|
|
|
|
|
|
|
|
Other Assets
|
|
|
|
|
|
|
|
|
Deposits by derivatives margin
|
|
|
247,221
|
|
|
|
336,548
|
|
Prepaid expenses
|
|
|
42,754
|
|
|
|
37,394
|
|
Other accounts and notes receivable
|
|
|
42,333
|
|
|
|
29,080
|
|
Recoverable income taxes
|
|
|
32,912
|
|
|
|
44,665
|
|
Trading and brokerage (***)
|
|
|
17,316
|
|
|
|
28,478
|
|
Investment properties
|
|
|
13,368
|
|
|
|
13,938
|
|
Commissions receivable
|
|
|
11,971
|
|
|
|
12,155
|
|
Servipag available funds
|
|
|
11,731
|
|
|
|
13,991
|
|
VAT receivable
|
|
|
11,526
|
|
|
|
15,021
|
|
Pending transactions
|
|
|
2,700
|
|
|
|
2,070
|
|
Accounts receivable for sale of assets received in lieu of payment
|
|
|
2,182
|
|
|
|
4,816
|
|
Rental guarantees
|
|
|
1,931
|
|
|
|
1,895
|
|
Assets recovered from leasing for sale
|
|
|
1,029
|
|
|
|
1,064
|
|
Materials and supplies
|
|
|
792
|
|
|
|
745
|
|
Others
|
|
|
12,868
|
|
|
|
12,684
|
|
Subtotal
|
|
|
452,634
|
|
|
|
554,544
|
|
Total
|
|
|
562,342
|
|
|
|
673,380
|
|
|
(*)
|
These correspond to property and equipment to be given
under finance lease.
|
|
(**)
|
Assets received in lieu of payment are assets received
as payment of customers’ past-due debts. The assets acquired must not exceed the aggregate 20% of the Bank’s effective
equity. These assets currently represent 0.0584% (0.0877% as of December 31, 2018) of the Bank’s effective equity.
|
The
assets awarded at judicial sale are not subject to the aforementioned margin. These properties are assets available for sale and
is expected to be completed the sale within one year from the date the asset is received or acquired. In the event that said assets
are not sold within one year, it must be written off.
The
provision for assets received in lieu of payment or awarded is recorded as indicated in the Compendium of Accounting Standards,
Chapter B-5 No.3, which indicates to recognize a provision for the difference between the initial value plus any additions and
its realizable value, when the initial is greater.
|
(***)
|
This item mainly includes simultaneous operations carried
out by the subsidiary Banchile Corredores de Bolsa S.A.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
18.
|
Other Assets, continued:
|
|
(b)
|
The changes of the provision for assets received in
lieu of payment during the three-month period ended as of June 30, 2019 and 2018 are as follows:
|
Provision for assets received in lieu of payment
|
|
MCh$
|
|
|
|
|
|
Balance as of January 1, 2018
|
|
|
818
|
|
Provisions used
|
|
|
(1,282
|
)
|
Provisions established
|
|
|
1,488
|
|
Balance as of June 30, 2018
|
|
|
1,024
|
|
Provisions used
|
|
|
(1,499
|
)
|
Provisions established
|
|
|
1,281
|
|
Balance as of December 31, 2018
|
|
|
806
|
|
Provisions used
|
|
|
(1,143
|
)
|
Provisions established
|
|
|
584
|
|
Balance as of June 30, 2019
|
|
|
247
|
|
|
19.
|
Current accounts and Other Demand Deposits:
|
At the
end of each period, this item is composed as follows:
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Current accounts
|
|
|
7,601,790
|
|
|
|
7,725,465
|
|
Other demand deposits
|
|
|
1,277,860
|
|
|
|
1,143,414
|
|
Other deposits and sight accounts
|
|
|
721,138
|
|
|
|
715,609
|
|
Total
|
|
|
9,600,788
|
|
|
|
9,584,488
|
|
|
20.
|
Savings accounts and Time Deposits:
|
At the end of each period,
this item is composed as follows:
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Time deposits
|
|
|
10,497,181
|
|
|
|
10,343,922
|
|
Term savings accounts
|
|
|
233,843
|
|
|
|
224,303
|
|
Other term balances payable
|
|
|
67,885
|
|
|
|
87,949
|
|
Total
|
|
|
10,798,909
|
|
|
|
10,656,174
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
21.
|
Borrowings from Financial Institutions:
|
|
(a)
|
At the end of each period, borrowings from financial
institutions are detailed as follows:
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Domestic banks
|
|
|
|
|
|
|
Banco do Brasil
|
|
|
6,901
|
|
|
|
7,001
|
|
Banco Security
|
|
|
—
|
|
|
|
374
|
|
Subtotal domestic banks
|
|
|
6,901
|
|
|
|
7,375
|
|
|
|
|
|
|
|
|
|
|
Foreign banks
|
|
|
|
|
|
|
|
|
Foreign trade financing
|
|
|
|
|
|
|
|
|
Citibank N.A.
|
|
|
244,520
|
|
|
|
212,329
|
|
Bank of America
|
|
|
226,431
|
|
|
|
210,279
|
|
Sumitomo Mitsui Banking
|
|
|
213,504
|
|
|
|
196,571
|
|
Bank of New York Mellon
|
|
|
169,860
|
|
|
|
152,828
|
|
Wells Fargo Bank
|
|
|
138,681
|
|
|
|
225,087
|
|
Toronto Dominion Bank
|
|
|
102,878
|
|
|
|
84,056
|
|
The Bank of Nova Scotia
|
|
|
87,078
|
|
|
|
122,080
|
|
Standard Chartered Bank
|
|
|
67,196
|
|
|
|
296
|
|
Mizuho Bank Ltd.
|
|
|
62,274
|
|
|
|
63,651
|
|
Zuercher Kantonalbank
|
|
|
54,428
|
|
|
|
55,621
|
|
JP Morgan Chase Bank
|
|
|
40,817
|
|
|
|
62,557
|
|
Banco Latinoamericano (Bladex)
|
|
|
33,953
|
|
|
|
—
|
|
DZ Bank AG
|
|
|
22,730
|
|
|
|
—
|
|
Commerzbank AG
|
|
|
2,583
|
|
|
|
1,084
|
|
Industrial and Commercial Bank of China
|
|
|
1,386
|
|
|
|
—
|
|
Others
|
|
|
510
|
|
|
|
24
|
|
Borrowings and other obligations
|
|
|
|
|
|
|
|
|
Wells Fargo Bank
|
|
|
102,423
|
|
|
|
104,637
|
|
Citibank N.A.
|
|
|
16,752
|
|
|
|
15,940
|
|
Bank of America
|
|
|
1,634
|
|
|
|
486
|
|
Deutsche Bank AG
|
|
|
30
|
|
|
|
161
|
|
Standard Chartered Bank
|
|
|
—
|
|
|
|
1,612
|
|
Others
|
|
|
86
|
|
|
|
85
|
|
Subtotal foreign banks
|
|
|
1,589,754
|
|
|
|
1,509,384
|
|
|
|
|
|
|
|
|
|
|
Chilean Central Bank
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
1,596,655
|
|
|
|
1,516,759
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
At the end of each period, this item is
composed as follows:
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Mortgage bonds
|
|
|
13,668
|
|
|
|
16,368
|
|
Bonds
|
|
|
7,171,494
|
|
|
|
6,772,990
|
|
Subordinated bonds
|
|
|
678,645
|
|
|
|
686,194
|
|
Total
|
|
|
7,863,807
|
|
|
|
7,475,552
|
|
During the period ended as of
June 30, 2019, Banco de Chile issued bonds by an amount of Ch$867,072 million, from which corresponds to Current Bonds and Short-Term
Bonds by an amount of Ch$371,576 million and Ch$495,496 million respectively, according to the following details:
Current Bonds Long-Term
Serie
|
|
Currency
|
|
Amount
MCh$
|
|
|
Terms
Years
|
|
Annual issue rate %
|
|
|
Issue date
|
|
Maturity date
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BCHIEC0817
|
|
UF
|
|
|
83,470
|
|
|
5
|
|
|
1.55
|
|
|
30/01/2019
|
|
30/01/2024
|
BCHIED1117
|
|
UF
|
|
|
41,711
|
|
|
5
|
|
|
1.54
|
|
|
14/03/2019
|
|
14/03/2024
|
BCHIED1117
|
|
UF
|
|
|
5,587
|
|
|
5
|
|
|
1.45
|
|
|
19/03/2019
|
|
19/03/2024
|
BCHIED1117
|
|
UF
|
|
|
36,317
|
|
|
5
|
|
|
1.45
|
|
|
20/03/2019
|
|
20/03/2024
|
BCHIDW1017
|
|
UF
|
|
|
84,359
|
|
|
2
|
|
|
0.93
|
|
|
09/05/2019
|
|
09/05/2021
|
BCHIDW1017
|
|
UF
|
|
|
57,091
|
|
|
2
|
|
|
0.57
|
|
|
24/06/2019
|
|
24/06/2021
|
Subtotal UF
|
|
|
|
|
308,535
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BONO JPY
|
|
JPY
|
|
|
63,041
|
|
|
20
|
|
|
1.00
|
|
|
14/05/2019
|
|
14/05/2039
|
Subtotal Others currency
|
|
|
|
|
63,041
|
|
|
|
|
|
|
|
|
|
|
|
Total as of June 30, 2019
|
|
|
|
|
371,576
|
|
|
|
|
|
|
|
|
|
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
22.
|
Debt Issued, continued:
|
Short-term Bonds
Counterparty
|
|
Currency
|
|
Amount MCh$
|
|
|
Annual
interest rate
%
|
|
|
Issued date
|
|
Maturity date
|
Citibank N.A.
|
|
USD
|
|
|
40,937
|
|
|
|
2.91
|
|
|
04/01/2019
|
|
04/04/2019
|
Wells Fargo Bank
|
|
USD
|
|
|
40,264
|
|
|
|
2.85
|
|
|
17/01/2019
|
|
24/04/2019
|
Citibank N.A.
|
|
USD
|
|
|
33,598
|
|
|
|
2.80
|
|
|
22/01/2019
|
|
22/04/2019
|
Citibank N.A.
|
|
USD
|
|
|
53,250
|
|
|
|
2.67
|
|
|
04/04/2019
|
|
02/07/2019
|
Citibank N.A.
|
|
USD
|
|
|
27,886
|
|
|
|
2.67
|
|
|
09/04/2019
|
|
09/08/2019
|
Citibank N.A.
|
|
USD
|
|
|
33,257
|
|
|
|
2.66
|
|
|
11/04/2019
|
|
11/07/2019
|
Wells Fargo Bank
|
|
USD
|
|
|
33,257
|
|
|
|
2.68
|
|
|
11/04/2019
|
|
11/10/2019
|
Citibank N.A.
|
|
USD
|
|
|
33,051
|
|
|
|
2.66
|
|
|
12/04/2019
|
|
22/07/2019
|
Wells Fargo Bank
|
|
USD
|
|
|
3,966
|
|
|
|
2.67
|
|
|
12/04/2019
|
|
12/09/2019
|
Citibank N.A.
|
|
USD
|
|
|
27,184
|
|
|
|
2.67
|
|
|
29/04/2019
|
|
29/10/2019
|
Wells Fargo Bank
|
|
USD
|
|
|
33,838
|
|
|
|
2.60
|
|
|
30/04/2019
|
|
30/07/2019
|
Citibank N.A.
|
|
USD
|
|
|
34,795
|
|
|
|
2.61
|
|
|
17/05/2019
|
|
18/11/2019
|
Citibank N.A.
|
|
USD
|
|
|
34,842
|
|
|
|
2.59
|
|
|
23/05/2019
|
|
22/08/2019
|
Bank of America
|
|
USD
|
|
|
34,208
|
|
|
|
2.50
|
|
|
21/06/2019
|
|
22/08/2019
|
Wells Fargo Bank
|
|
USD
|
|
|
3,421
|
|
|
|
2.50
|
|
|
24/06/2019
|
|
25/07/2019
|
Citibank N.A.
|
|
USD
|
|
|
547
|
|
|
|
2.40
|
|
|
24/06/2019
|
|
15/10/2019
|
Citibank N.A.
|
|
USD
|
|
|
13,620
|
|
|
|
2.50
|
|
|
25/06/2019
|
|
05/08/2019
|
Citibank N.A.
|
|
USD
|
|
|
13,575
|
|
|
|
2.51
|
|
|
28/06/2019
|
|
01/08/2019
|
Total as of June 30, 2019
|
|
|
|
|
495,496
|
|
|
|
|
|
|
|
|
|
During the period ended June 30,
2019, there were no subordinated bonds, issued.
During the year ended as of December
31, 2018, Banco de Chile issued bonds by an amount of Ch$2,157,587 million, from which corresponds to Current Bonds and Short-Term
Bonds by an amount of Ch$1,216,867 million and Ch$940,720 million respectively, according to the following details:
Current Bonds Long-Term
Serie
|
|
Currency
|
|
Amount
MCh$
|
|
|
Terms
Years
|
|
Annual
issue rate %
|
|
|
Issue date
|
|
Maturity date
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BCHIEA0617
|
|
UF
|
|
|
106,001
|
|
|
6
|
|
|
1.60
|
|
|
03/01/2018
|
|
03/01/2024
|
BCHIBN1015
|
|
UF
|
|
|
114,212
|
|
|
12
|
|
|
2.90
|
|
|
24/01/2018
|
|
24/01/2030
|
BCHIEF1117
|
|
UF
|
|
|
79,612
|
|
|
8
|
|
|
1.80
|
|
|
09/02/2018
|
|
09/02/2026
|
BCHIEP0717
|
|
UF
|
|
|
104,550
|
|
|
11
|
|
|
2.00
|
|
|
13/02/2018
|
|
13/02/2029
|
BCHIBT1215
|
|
UF
|
|
|
57,936
|
|
|
14
|
|
|
3.00
|
|
|
13/03/2018
|
|
13/03/2032
|
BCHIBW1215
|
|
UF
|
|
|
59,081
|
|
|
14
|
|
|
2.20
|
|
|
14/08/2018
|
|
14/08/2032
|
BCHIDY0917
|
|
UF
|
|
|
55,619
|
|
|
5
|
|
|
1.24
|
|
|
16/08/2018
|
|
16/08/2023
|
BCHIEN1117
|
|
UF
|
|
|
109,543
|
|
|
10
|
|
|
2.08
|
|
|
25/09/2018
|
|
25/09/2028
|
BCHIDX0817
|
|
UF
|
|
|
109,311
|
|
|
5
|
|
|
1.70
|
|
|
22/10/2018
|
|
22/10/2023
|
BCHIDY0917
|
|
UF
|
|
|
12,025
|
|
|
5
|
|
|
1.74
|
|
|
22/10/2018
|
|
22/10/2023
|
BCHIDY0917
|
|
UF
|
|
|
15,299
|
|
|
5
|
|
|
1.75
|
|
|
22/10/2018
|
|
22/10/2023
|
BCHIBY1215
|
|
UF
|
|
|
59,374
|
|
|
15
|
|
|
2.29
|
|
|
24/10/2018
|
|
24/10/2033
|
BCHIBX0815
|
|
UF
|
|
|
58,998
|
|
|
15
|
|
|
2.29
|
|
|
24/10/2018
|
|
24/10/2033
|
BCHIBZ0815
|
|
UF
|
|
|
59,987
|
|
|
15
|
|
|
2.23
|
|
|
07/12/2018
|
|
07/12/2033
|
BCHIEJ0717
|
|
UF
|
|
|
82,878
|
|
|
9
|
|
|
1.99
|
|
|
12/12/2018
|
|
12/12/2027
|
Subtotal UF
|
|
|
|
|
1,084,426
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BCHIDH0916
|
|
CLP
|
|
|
20,370
|
|
|
4
|
|
|
3.80
|
|
|
11/06/2018
|
|
11/06/2022
|
BONO USD
|
|
USD
|
|
|
32,842
|
|
|
10
|
|
|
4.26
|
|
|
28/09/2018
|
|
28/09/2028
|
BONO CHF
|
|
CHF
|
|
|
79,229
|
|
|
5
|
|
|
0.57
|
|
|
26/10/2018
|
|
26/10/2023
|
Subtotal others currency
|
|
|
|
|
132,441
|
|
|
|
|
|
|
|
|
|
|
|
Total as of December 31, 2018
|
|
|
|
|
1,216,867
|
|
|
|
|
|
|
|
|
|
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
22.
|
Debt Issued, continued:
|
Short-term Bonds
Counterparty
|
|
Currency
|
|
Amount
MCh$
|
|
|
Annual
interest rate
%
|
|
|
Issued date
|
|
Maturity
date
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wells Fargo Bank
|
|
USD
|
|
|
2,998
|
|
|
|
1.85
|
|
|
06/02/2018
|
|
08/05/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
2,998
|
|
|
|
1.93
|
|
|
06/02/2018
|
|
08/06/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
2,998
|
|
|
|
1.98
|
|
|
06/02/2018
|
|
09/07/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
2,998
|
|
|
|
2.05
|
|
|
06/02/2018
|
|
06/08/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
2,998
|
|
|
|
2.05
|
|
|
06/02/2018
|
|
08/08/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
29,716
|
|
|
|
2.25
|
|
|
28/02/2018
|
|
28/06/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
1,723
|
|
|
|
2.40
|
|
|
28/02/2018
|
|
29/08/2018
|
Citibank N.A.
|
|
USD
|
|
|
6,894
|
|
|
|
2.60
|
|
|
28/02/2018
|
|
25/02/2019
|
Wells Fargo Bank
|
|
USD
|
|
|
13,780
|
|
|
|
2.30
|
|
|
02/03/2018
|
|
02/07/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
4,489
|
|
|
|
2.30
|
|
|
05/03/2018
|
|
06/07/2018
|
Citibank N.A.
|
|
USD
|
|
|
18,080
|
|
|
|
2.22
|
|
|
07/03/2018
|
|
05/06/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
1,747
|
|
|
|
2.25
|
|
|
13/03/2018
|
|
11/06/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
3,006
|
|
|
|
2.45
|
|
|
14/03/2018
|
|
11/09/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
606
|
|
|
|
2.60
|
|
|
15/03/2018
|
|
14/12/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
605
|
|
|
|
2.60
|
|
|
29/03/2018
|
|
28/09/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
60,343
|
|
|
|
2.60
|
|
|
05/04/2018
|
|
04/09/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
30,254
|
|
|
|
2.50
|
|
|
06/04/2018
|
|
01/08/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
1,743
|
|
|
|
2.40
|
|
|
10/04/2018
|
|
09/08/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
8,918
|
|
|
|
2.75
|
|
|
13/04/2018
|
|
12/04/2019
|
Wells Fargo Bank
|
|
USD
|
|
|
8,946
|
|
|
|
2.75
|
|
|
17/04/2018
|
|
16/04/2019
|
Citibank N.A.
|
|
USD
|
|
|
19,046
|
|
|
|
2.36
|
|
|
08/05/2018
|
|
08/08/2018
|
Citibank N.A.
|
|
USD
|
|
|
31,665
|
|
|
|
2.38
|
|
|
09/05/2018
|
|
07/08/2018
|
Citibank N.A.
|
|
USD
|
|
|
1,873
|
|
|
|
2.37
|
|
|
10/05/2018
|
|
08/08/2018
|
Citibank N.A.
|
|
USD
|
|
|
12,250
|
|
|
|
2.36
|
|
|
14/05/2018
|
|
15/08/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
18,968
|
|
|
|
2.70
|
|
|
11/06/2018
|
|
01/04/2019
|
Wells Fargo Bank
|
|
USD
|
|
|
28,973
|
|
|
|
2.42
|
|
|
13/06/2018
|
|
24/07/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
15,991
|
|
|
|
2.45
|
|
|
19/06/2018
|
|
20/09/2018
|
Citibank N.A.
|
|
USD
|
|
|
12,778
|
|
|
|
2.41
|
|
|
20/06/2018
|
|
20/09/2018
|
Citibank N.A.
|
|
USD
|
|
|
31,944
|
|
|
|
2.45
|
|
|
20/06/2018
|
|
03/10/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
3,194
|
|
|
|
2.65
|
|
|
20/06/2018
|
|
13/02/2019
|
Citibank N.A.
|
|
USD
|
|
|
3,885
|
|
|
|
2.50
|
|
|
22/06/2018
|
|
23/11/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
19,495
|
|
|
|
2.20
|
|
|
28/06/2018
|
|
27/07/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
4,875
|
|
|
|
2.30
|
|
|
03/07/2018
|
|
11/09/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
29,556
|
|
|
|
2.30
|
|
|
06/07/2018
|
|
10/09/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
62,079
|
|
|
|
2.45
|
|
|
17/07/2018
|
|
17/10/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
32,729
|
|
|
|
2.45
|
|
|
24/07/2018
|
|
22/10/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
19,283
|
|
|
|
2.45
|
|
|
27/07/2018
|
|
29/10/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
31,919
|
|
|
|
2.50
|
|
|
30/07/2018
|
|
29/11/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
16,039
|
|
|
|
2.52
|
|
|
01/08/2018
|
|
06/12/2018
|
Citibank N.A.
|
|
USD
|
|
|
25,787
|
|
|
|
2.50
|
|
|
02/08/2018
|
|
06/12/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
10,859
|
|
|
|
2.47
|
|
|
07/08/2018
|
|
14/12/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
3,238
|
|
|
|
2.46
|
|
|
09/08/2018
|
|
14/12/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
17,070
|
|
|
|
2.53
|
|
|
31/08/2018
|
|
28/12/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
6,929
|
|
|
|
2.58
|
|
|
04/09/2018
|
|
06/02/2019
|
Citibank N.A.
|
|
USD
|
|
|
34,646
|
|
|
|
2.57
|
|
|
04/09/2018
|
|
04/01/2019
|
Citibank N.A.
|
|
USD
|
|
|
4,902
|
|
|
|
2.24
|
|
|
07/09/2018
|
|
09/10/2018
|
Citibank N.A.
|
|
USD
|
|
|
34,525
|
|
|
|
2.25
|
|
|
07/09/2018
|
|
09/10/2018
|
Citibank N.A.
|
|
USD
|
|
|
1,742
|
|
|
|
2.23
|
|
|
10/09/2018
|
|
09/10/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
3,484
|
|
|
|
2.65
|
|
|
10/09/2018
|
|
11/03/2019
|
Wells Fargo Bank
|
|
USD
|
|
|
6,026
|
|
|
|
2.45
|
|
|
11/09/2018
|
|
06/12/2018
|
Bank of America
|
|
USD
|
|
|
18,421
|
|
|
|
2.62
|
|
|
14/09/2018
|
|
01/03/2019
|
Wells Fargo Bank
|
|
USD
|
|
|
33,464
|
|
|
|
2.48
|
|
|
20/09/2018
|
|
20/12/2018
|
Wells Fargo Bank
|
|
USD
|
|
|
1,322
|
|
|
|
2.70
|
|
|
03/10/2018
|
|
05/04/2019
|
Wells Fargo Bank
|
|
USD
|
|
|
13,591
|
|
|
|
2.78
|
|
|
12/10/2018
|
|
25/04/2019
|
Wells Fargo Bank
|
|
USD
|
|
|
6,694
|
|
|
|
2.55
|
|
|
16/10/2018
|
|
16/01/2019
|
Citibank N.A.
|
|
USD
|
|
|
6,713
|
|
|
|
2.50
|
|
|
17/10/2018
|
|
04/01/2019
|
Citibank N.A.
|
|
USD
|
|
|
34,208
|
|
|
|
2.65
|
|
|
23/10/2018
|
|
22/01/2019
|
Citibank N.A.
|
|
USD
|
|
|
20,483
|
|
|
|
2.84
|
|
|
11/12/2018
|
|
11/03/2019
|
Wells Fargo Bank
|
|
USD
|
|
|
2,236
|
|
|
|
2.90
|
|
|
12/12/2018
|
|
12/04/2019
|
Wells Fargo Bank
|
|
USD
|
|
|
34,555
|
|
|
|
2.67
|
|
|
20/12/2018
|
|
19/02/2019
|
Wells Fargo Bank
|
|
USD
|
|
|
10,466
|
|
|
|
2.97
|
|
|
27/12/2018
|
|
02/05/2019
|
Wells Fargo Bank
|
|
USD
|
|
|
6,977
|
|
|
|
2.97
|
|
|
27/12/2018
|
|
29/04/2019
|
Total
as of December 31, 2018
|
|
|
|
|
940,720
|
|
|
|
|
|
|
|
|
|
During
the year ended December 31, 2018, there were no subordinated bonds, issued.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
22.
|
Debt Issued, continued:
|
During the period of June 30,
2019 and December 31, 2018, the Bank has not been in default of principal and interest on its debt instruments. Likewise, there
have been no breaches of covenants and other commitments associated with the debt instruments issued.
|
23.
|
Other Financial Obligations:
|
At
the end of each period, this item is composed as follows:
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Other Chilean obligations
|
|
|
150,329
|
|
|
|
95,912
|
|
Public sector obligations
|
|
|
20,955
|
|
|
|
22,102
|
|
Total
|
|
|
171,284
|
|
|
|
118,014
|
|
|
(a)
|
At the end of each period, this item is composed as
follows:
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Provisions for minimum dividends (*)
|
|
|
148,510
|
|
|
|
305,409
|
|
Provisions for personnel benefits and payroll expenses
|
|
|
76,496
|
|
|
|
92,579
|
|
Provisions for contingent loan risks
|
|
|
58,200
|
|
|
|
55,530
|
|
Provisions for contingencies:
|
|
|
|
|
|
|
|
|
Additional loan provisions
|
|
|
213,252
|
|
|
|
213,252
|
|
Country risk provisions
|
|
|
9,967
|
|
|
|
2,881
|
|
Other provisions for contingencies
|
|
|
503
|
|
|
|
468
|
|
Total
|
|
|
506,928
|
|
|
|
670,119
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
24.
|
Provisions, continued:
|
|
(b)
|
The following table shows the changes in provisions
and accrued expenses during the periods 2019 and 2018:
|
|
|
Minimum dividends
|
|
|
Personnel benefits
and payroll
|
|
|
Contingent loan Risks
|
|
|
Additional loan provisions
|
|
|
Country risk provisions and other contingencies
|
|
|
Total
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balances as of January 1, 2018
|
|
|
312,907
|
|
|
|
86,628
|
|
|
|
58,031
|
|
|
|
213,252
|
|
|
|
25,050
|
|
|
|
695,868
|
|
Provisions established
|
|
|
155,398
|
|
|
|
34,567
|
|
|
|
3,159
|
|
|
|
—
|
|
|
|
5,779
|
|
|
|
198,903
|
|
Provisions used
|
|
|
(312,907
|
)
|
|
|
(50,394
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(21,269
|
)
|
|
|
(384,570
|
)
|
Provisions released
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Balances as of June 30, 2018
|
|
|
155,398
|
|
|
|
70,801
|
|
|
|
61,190
|
|
|
|
213,252
|
|
|
|
9,560
|
|
|
|
510,201
|
|
Provisions established
|
|
|
150,011
|
|
|
|
38,379
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
188,390
|
|
Provisions used
|
|
|
—
|
|
|
|
(16,601
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
1,922
|
|
|
|
(14,679
|
)
|
Provisions released
|
|
|
—
|
|
|
|
—
|
|
|
|
(5,660
|
)
|
|
|
—
|
|
|
|
(8,133
|
)
|
|
|
(13,793
|
)
|
Balances as of December 31, 2018
|
|
|
305,409
|
|
|
|
92,579
|
|
|
|
55,530
|
|
|
|
213,252
|
|
|
|
3,349
|
|
|
|
670,119
|
|
Provisions established
|
|
|
148,510
|
|
|
|
37,971
|
|
|
|
2,670
|
|
|
|
—
|
|
|
|
7,121
|
|
|
|
196,272
|
|
Provisions used
|
|
|
(305,409
|
)
|
|
|
(54,054
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(359,463
|
)
|
Provisions released
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Balances as of June 30, 2019
|
|
|
148,510
|
|
|
|
76,496
|
|
|
|
58,200
|
|
|
|
213,252
|
|
|
|
10,470
|
|
|
|
506,928
|
|
|
(c)
|
Provisions for personnel benefits and payroll:
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Provisions for performance bonuses
|
|
|
26,180
|
|
|
|
47,797
|
|
Staff accrued vacation provision
|
|
|
26,916
|
|
|
|
26,855
|
|
Staff severance indemnities
|
|
|
7,694
|
|
|
|
7,754
|
|
Other personnel benefits provision
|
|
|
15,706
|
|
|
|
10,173
|
|
Total
|
|
|
76,496
|
|
|
|
92,579
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
24.
|
Provisions, continued:
|
|
(d)
|
Staff severance indemnities:
|
|
(i)
|
Changes in the staff severance indemnities:
|
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Present value of the obligations at the beginning of the period
|
|
|
7,754
|
|
|
|
7,676
|
|
Increase (Decrease) in provision
|
|
|
127
|
|
|
|
299
|
|
Benefit paid
|
|
|
(373
|
)
|
|
|
(141
|
)
|
Effect of change in actuarial factors
|
|
|
186
|
|
|
|
—
|
|
Total
|
|
|
7,694
|
|
|
|
7,834
|
|
|
(ii)
|
Net benefits expenses:
|
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
(Decrease) Increase in provisions
|
|
|
(125
|
)
|
|
|
(42
|
)
|
Interest cost of benefits obligations
|
|
|
252
|
|
|
|
341
|
|
Effect of change in actuarial factors
|
|
|
186
|
|
|
|
—
|
|
Net benefit expenses
|
|
|
313
|
|
|
|
299
|
|
|
(iii)
|
Factors used in the calculation of the provision:
|
The
main assumptions used in the determination of severance indemnity obligations for the Bank’s plan are shown below:
|
|
June 30,
2019
|
|
|
December 31,
2018
|
|
|
|
%
|
|
|
%
|
|
|
|
|
|
|
|
|
Discount rate
|
|
|
3.42
|
|
|
|
4.25
|
|
Salary increase rate
|
|
|
4.42
|
|
|
|
4.42
|
|
Payment probability
|
|
|
99.99
|
|
|
|
99.99
|
|
The
most recent actuarial valuation of the staff severance indemnities provision was carried out during the period ended June 30, 2019.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
24.
|
Provisions, continued:
|
|
(e)
|
Changes in compliance bonuses provision:
|
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Balances as of January 1
|
|
|
47,797
|
|
|
|
43,372
|
|
Net provisions established
|
|
|
15,900
|
|
|
|
18,751
|
|
Provisions used
|
|
|
(37,517
|
)
|
|
|
(35,630
|
)
|
Total
|
|
|
26,180
|
|
|
|
26,493
|
|
|
(f)
|
Changes in staff accrued vacation provision:
|
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Balances as of January 1
|
|
|
26,855
|
|
|
|
25,159
|
|
Net provisions established
|
|
|
3,411
|
|
|
|
3,279
|
|
Provisions used
|
|
|
(3,350
|
)
|
|
|
(2,939
|
)
|
Total
|
|
|
26,916
|
|
|
|
25,499
|
|
|
(g)
|
Employee benefits share-based provision:
|
As of June 30, 2019 and 2018,
the Bank and its subsidiaries do not have a stock-based compensation plan.
|
(h)
|
Contingent loan provisions:
|
As of June 30, 2019 and December
31, 2018, the Bank and its subsidiaries maintain contingent loan provisions by an amount of Ch$58,200 million (Ch$55,530 million
in December 2018). See Note No. 26 (d).
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
At the end of each
period, this item is composed as follows:
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Accounts and notes payable
|
|
|
232,282
|
|
|
|
176,826
|
|
Income received in advance (*)
|
|
|
150,681
|
|
|
|
5,743
|
|
Dividends payable
|
|
|
1,148
|
|
|
|
1,079
|
|
|
|
|
|
|
|
|
|
|
Other liabilities
|
|
|
|
|
|
|
|
|
VAT debit
|
|
|
44,342
|
|
|
|
13,719
|
|
Documents intermediated (**)
|
|
|
36,271
|
|
|
|
53,492
|
|
Cobranding
|
|
|
31,011
|
|
|
|
36,081
|
|
Securities unliquidated
|
|
|
16,551
|
|
|
|
106,071
|
|
Insurance payments
|
|
|
1,075
|
|
|
|
992
|
|
Outstanding transactions
|
|
|
686
|
|
|
|
616
|
|
Others
|
|
|
18,546
|
|
|
|
17,905
|
|
Total
|
|
|
532,593
|
|
|
|
412,524
|
|
|
(*)
|
In relation to the Strategic Alliance Framework Agreement
disclosed in Note No. 5 c), on June 4, 2019, Banco Chile received the payment from the Insurance Companies for an amount of Ch$149,061
million, which was recorded according to IFRS 15. The related income will be recognized over time, when the performance obligation
is satisfied.
|
|
(**)
|
This item mainly includes financing of simultaneous operations
performed by subsidiary Banchile Corredores de Bolsa S.A.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
26.
|
Contingencies and Commitments:
|
|
(a)
|
Commitments and responsibilities accounted for in off-balance-sheet
accounts:
|
In
order to satisfy its customers’ needs, the Bank entered into several irrevocable commitments and contingent obligations.
Although these obligations are not recognized in the Statement of Financial Position, they entail credit risks and, therefore,
form part of the Bank’s overall risk.
The
Bank and its subsidiaries keep recorded in off-balance sheet accounts the main balances related to commitments or with responsibilities
inherent to the course of its normal business:
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
Contingent loans
|
|
|
|
|
|
|
|
|
Guarantees and sureties
|
|
|
265,582
|
|
|
|
341,676
|
|
Confirmed foreign letters of credit
|
|
|
32,178
|
|
|
|
56,764
|
|
Issued letters of credit
|
|
|
378,593
|
|
|
|
388,396
|
|
Bank guarantees
|
|
|
2,288,495
|
|
|
|
2,232,682
|
|
Freely disposition credit lines
|
|
|
7,626,143
|
|
|
|
7,769,325
|
|
Other credit commitments
|
|
|
174,390
|
|
|
|
46,561
|
|
|
|
|
|
|
|
|
|
|
Transactions on behalf of third parties
|
|
|
|
|
|
|
|
|
Documents in collections
|
|
|
145,654
|
|
|
|
160,367
|
|
Third-party resources managed by the Bank:
|
|
|
|
|
|
|
|
|
Financial assets managed on behalf of third parties
|
|
|
6,670
|
|
|
|
27,334
|
|
Other assets managed on behalf of third parties
|
|
|
—
|
|
|
|
—
|
|
Financial assets acquired on its own behalf
|
|
|
67,569
|
|
|
|
103,319
|
|
Other assets acquired on its own behalf
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
Custody of securities
|
|
|
|
|
|
|
|
|
Securities held in safe custody in the Bank and subsidiaries
|
|
|
6,729,352
|
|
|
|
6,930,293
|
|
Securities held in safe custody in other entities
|
|
|
14,122,907
|
|
|
|
13,783,748
|
|
Total
|
|
|
31,837,533
|
|
|
|
31,840,465
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
26.
|
Contingencies and Commitments, continued:
|
|
(b)
|
Lawsuits and legal proceedings:
|
|
(b.1)
|
Normal judicial contingencies in the industry:
|
At the date of issuance of
these Interim Consolidated Financial Statements, there are legal actions filed against the Bank related with the ordinary course
operations. As of June 30, 2019 the Bank maintain provisions for judicial contingencies amounting to Ch$239 million (Ch$204 million
as of December 31, 2018) which are part of the item “Provisions” in the Statement of Financial Position.
The
estimated end dates of the respective legal contingencies are as follows:
|
|
As of June 30, 2019
|
|
|
|
2019
|
|
|
2020
|
|
|
2021
|
|
|
2022
|
|
|
Total
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Legal contingencies
|
|
|
6
|
|
|
|
139
|
|
|
|
94
|
|
|
|
—
|
|
|
|
239
|
|
|
(b.2)
|
Contingencies for significant lawsuits in courts:
|
As
of June 30, 2019 and December 31, 2018 there are not significant lawsuits in court that affect or may affect these Interim Consolidated
Financial Statements.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
26.
|
Contingencies and Commitments, continued:
|
|
(c)
|
Guarantees granted by operations
:
|
|
i.
|
In subsidiary Banchile Administradora General de
Fondos S.A.:
|
In compliance with Article
No, 12 of Law No. 20,712, Banchile Administradora General de Fondos S.A., has designated Banco de Chile as the representative of
the beneficiaries of the guarantees it has established, and in such role the Bank has issued bank guarantees totaling UF 2,988,700,
maturing January 10, 2020 (UF 2,977,300, maturing on January 10, 2019 as of December 31, 2018). The subsidiary took a policy with
Mapfre Seguros Generales S.A. for the Real State Funds by a guaranteed amount of UF 695,800.
As of June 30, 2019 and December
31, 2018 the Bank has not guaranteed mutual funds.
In compliance with the rules
established by the Chilean Commission for the Financial Market (CMF) in letter f) of Circular No. 1,894 of September 24, 2008,
the entity has constituted guarantees, by management portfolio, in benefit of investors. Such guarantee corresponds to a bank guarantee
for UF 401,800, with maturity on January 10, 2020.
|
ii.
|
In subsidiary Banchile Corredores de Bolsa S.A.:
|
For the purposes of ensuring
correct and complete compliance with all of its obligations as broker-dealer entity, in conformity with the provisions from Article
No. 30 and subsequent of Law No. 18,045 on Securities Markets, the subsidiary established a guarantee in an insurance policy for
UF 20,000, insured by Mapfre Seguros, that matures April 22, 2020, whereby the Securities Exchange of the Santiago Stock Exchange
was appointed as the subsidiary’s creditor representative.
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
Guarantees:
|
|
|
|
|
|
|
Shares delivered to cover simultaneous forward sales transactions:
|
|
|
|
|
|
|
|
|
Santiago Securities Exchange, Stock Exchange
|
|
|
77,691
|
|
|
|
59,074
|
|
Electronic Chilean Securities Exchange, Stock Exchange
|
|
|
8,475
|
|
|
|
17,223
|
|
|
|
|
|
|
|
|
|
|
Fixed income securities to guarantee CCLV system, Santiago Securities Exchange, Stock Exchange
|
|
|
5,894
|
|
|
|
5,976
|
|
Shares delivered to guarantee equity lending, Electronic Chilean Securities Exchange, Stock Exchange
|
|
|
—
|
|
|
|
—
|
|
Total
|
|
|
92,060
|
|
|
|
82,273
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
26.
|
Contingencies and Commitments, continued:
|
|
(c)
|
Guarantees granted, continued:
|
|
ii.
|
In subsidiary Banchile Corredores de Bolsa S.A.,
continued:
|
In conformity with the internal
regulation of the stock exchange in which this subsidiary participates, and for the purpose of securing the broker’s correct
performance, the Company established a pledge over 1,000,000 shares of the Santiago Stock Exchange, in favor of that institution,
as stated in the Public Deed dated September 13, 1990 before the notary of Santiago Mr. Raul Perry Pefaur, and over 100,000 shares
of the Electronic Chilean Stock Exchange, in favor of that Institution, as stated in a contract signed between both entities dated
May 16, 1990.
Banchile Corredores de Bolsa
S.A. keeps an insurance policy current with Southbridge Compañía de Seguros Generales S.A. that expires January 2,
2020, this considers matters of employee fidelity, physical losses, falsification or adulteration, and currency fraud with a coverage
amount equivalent to US$10,000,000.
According to disposition of
Chilean Central Bank, it provided a bank guarantee corresponding to UF 10,500, with purposes to comply with the requirements of
the SOMA contract (Contract for Service of System Open Market Operations) of the Chilean Central Bank. This bank guarantee is readjustable
in UF to fixed term, non-endorsable and has a maturity date of July 22, 2019.
It also provided a bank guarantee
No. 350329-3 in the amount of UF 251,400 for the benefits of investors in portfolio management contracts. This bank guarantee is
revaluated in UF to fixed term, non-endorsable and has a maturity date of January 10, 2020.
It also provided a cash guarantee
in the amount of US$122,494.32 for the purpose of complying with the obligations to Pershing, for any operations conducted through
that broker.
|
iii.
|
In subsidiary Banchile Corredores de Seguros Ltda.:
|
According to established in
article No. 58, letter D of D.F.L. 251, as of June 30, 2019 the entity maintains two insurance policies with effect from April
15, 2019 to April 14, 2020 which protect it against of potential damages caused by infractions of the law, regulations and complementary
rules that regulate insurance brokers, especially when the non-compliance comes from acts, errors or omissions of the broker, its
representatives, agents or dependents that participate in the intermediation.
The policies contracted are:
Matter insured
|
|
Amount Insured (UF)
|
|
|
|
Errors and omissions liability policy
|
|
60,000
|
Civil liability policy
|
|
500
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
26.
|
Contingencies and Commitments, continued:
|
|
(d)
|
Provisions for contingencies loans:
|
Established provisions for credit
risk from contingencies operations are the followings:
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Freely disposition credit lines
|
|
|
29,923
|
|
|
|
29,255
|
|
Bank guarantees provision
|
|
|
22,691
|
|
|
|
22,806
|
|
Guarantees and sureties provision
|
|
|
2,743
|
|
|
|
2,891
|
|
Letters of credit provision
|
|
|
463
|
|
|
|
494
|
|
Other credit commitments
|
|
|
2,380
|
|
|
|
84
|
|
Total
|
|
|
58,200
|
|
|
|
55,530
|
|
|
(e)
|
On January 30, 2014, the SVS (now the CMF) brought
administrative charges against Banchile Corredores de Bolsa S.A. for the alleged infringement of the second paragraph of Article
53 of Security Market Law in relation to certain specific transactions performed during the years 2009, 2010 and 2011 related
to Sociedad Química y Minera de Chile S.A.’s shares (SQM). In relation with the preceding, the second paragraph of
Article 53 of Security Market Law states that “…no person may engage in transactions or induce or attempt to induce
the purchase or sale of securities, whether or not governed by this Act, by means of any misleading or deceptive act, practice,
mechanism or artifice….”
|
On October 30, 2014, the SVS (now
the Chilean Commission for the Financial Market) imposed a fine of UF 50,000 on Banchile Corredores de Bolsa S.A., for violation
to the second paragraph of Article 53 of the Securities Market Law in relation to certain transaction of SQM-A’s shares intermediated
by the Company in 2011.
Banchile Corredores de Bolsa S.A.,
filed a claim in the 11th Civil Court of Santiago against Exempt Resolution N°270 of October 30, 2014 of the SVS (now the Chilean
Commission for the Financial Market), requesting the annulment of the fine. This claim was consolidated with the trial due No.
25,795-2014, of the 22nd Civil Court of Santiago. On December 10, 2018, the aforementioned Court summoned the parties to hear the
sentence, which to date has not yet been dictated.
On January 16, 2019, Banchile
Corredores de Bolsa S.A. filed before the Constitutional Court an appeal of inapplicability for unconstitutionality for the purpose
of declaring that subsection 1 of article 29 of Decree Law No. 3,538, Organic Law of the Superintendency of Securities and Insurance,
prior to its amendment by Law No. 21,000 of February 23, 2017, is inapplicable in this process for violating the rules of the Republic
Political Constitution. On March 28, 2019, said Court declared admissible the requirement of inapplicability, suspending the proceedings
before the 22nd Civil Court of Santiago.
According to the provisions policy
of Banchile Corredores de Bolsa S.A., the company has not made provisions because in this judicial proceeding no judgment has yet
been issued, as well as considering that the legal advisors estimate that there are solid grounds for dismissal.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
(i)
|
Authorized, subscribed and paid shares:
|
As of June 30, 2019, the paid-in
capital of Banco de Chile is represented by 101,017,081,114 registered shares (101,017,081,114 shares as of December 31, 2018),
with no par value, subscribed and fully paid.
The following
table shows the changes in share from December 31, 2017 to June 30, 2019:
|
|
Total
|
|
|
|
Ordinary
Shares
|
|
|
|
|
|
Total shares as of December 31, 2017
|
|
|
99,444,132,192
|
|
|
|
|
|
|
Capitalization of earning – Issue fully paid-in shares
|
|
|
1,572,948,922
|
|
|
|
|
|
|
Total shares as of December 31, 2018
|
|
|
101,017,081,114
|
|
|
|
|
|
|
Total shares as June 30, 2019
|
|
|
101,017,081,114
|
|
|
(b)
|
Approval and payment of dividends:
|
At the Bank Ordinary Shareholders’
Meeting held on March 28, 2019 it was approved the distribution and payment of dividend No. 207 of Ch$3.52723589646 per share of
the Banco de Chile, with charged to the net distributable income for the year ended as of December 31, 2018. The amount of the
dividend paid in year 2019 amounts to Ch$356,311 million.
At the Bank Ordinary Shareholders’
Meeting held on March 22, 2018 it was approved the distribution and payment of dividend No. 206 of Ch$3.14655951692 per share of
the Banco de Chile, with charged to the net distributable income for the year ended as of December 31, 2017. The amount of the
dividend paid in year 2018 amounts to Ch$374,079 million.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
(c)
|
Provision for minimum dividends:
|
In 2019, the Board of Directors
of Banco de Chile agreed to establish a provision for minimum dividends of 60% of the net distributable profit generated during
the course of the year, being understood as net distributable profit as net income for the corresponding period minus the value
effect of the monetary unit of paid capital and reserves, as a result of any change in the Consumer Price Index (CPI) between to
the month prior to the current month and the month of November of the previous year. This, maintains the criteria adopted at the
Extraordinary Shareholders’ Meeting held on March 25, 2010, which agreed the withholding of the equivalent to change in the CPI
of the paid-in capital and reserves, which was materialized with a transitory article of the bylaws with effect until the payment
of the subordinated obligation made on April 30, 2019.
As indicated above, the retained
earnings for the year ended December 31, 2018 in March 2019 amounted to Ch$85,856 million (the retained earnings for the year ended
December 31, 2017 in March 2018 amounted to Ch$54,501 million).
The amount of net distributable
profit as of June 30, 2019 amounts to Ch$247,517 million (Ch$509,015 million as of December 31, 2018). In accordance with the foregoing,
the Bank recorded a provision for minimum dividends under “Provisions” as of June 30 for an amount of Ch$148,510 million
(Ch$305,409 million in December 2018), reflecting as a counterpart a capital reduction for the same amount in the item “Retained
earnings”.
|
(i)
|
Basic earnings per share:
|
Basic earnings per share are
determined by dividing the net income attributable to the Bank ordinary equity holders in a period between the weighted average
number of shares outstanding during that period, excluding the average number of own shares held throughout the period.
|
(ii)
|
Diluted earnings per share:
|
In order to calculate the diluted
earnings per share, both the amount of income attributable to common shareholders and the weighted average number of shares outstanding,
net of own shares, must be adjusted for all the inherent dilutive effects to the potential common shares (stock options, warrants
and convertible debt).
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
Accordingly,
the basic and diluted earnings per share as of June 30, 2019 and 2018 were determined as follows:
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
Basic earnings per share:
|
|
|
|
|
|
|
Net profits attributable to ordinary equity holders of the bank (in million Chilean pesos)
|
|
|
293,663
|
|
|
|
305,214
|
|
Weighted average number of ordinary shares (*)
|
|
|
101,017,081,114
|
|
|
|
101,017,081,114
|
|
Earning per shares (in Chilean pesos)
|
|
|
2.91
|
|
|
|
3.02
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share:
|
|
|
|
|
|
|
|
|
Net profits attributable to ordinary equity holders of the bank (in million Chilean pesos)
|
|
|
293,663
|
|
|
|
305,214
|
|
Weighted average number of ordinary shares (*)
|
|
|
101,017,081,114
|
|
|
|
101,017,081,114
|
|
Assumed conversion of convertible debt
|
|
|
—
|
|
|
|
—
|
|
Adjusted number of shares
|
|
|
101,017,081,114
|
|
|
|
101,017,081,114
|
|
Diluted earnings per share (in Chilean pesos)
|
|
|
2.91
|
|
|
|
3.02
|
|
|
(*)
|
June
2018 considers
the number of fully paid-in shares issued on July 26, 2018.
|
As of June 30, 2019 and 2018,
the Bank does not have instruments that generate dilutive effects.
|
(e)
|
Other comprehensive income:
|
This item includes the following
concepts:
The adjustment of cash flow
hedge derivatives comprises the portion of income recorded in equity resulting from changes in fair value due to changes in market
factors. During the period 2019 it was made a charge to equity for Ch$25,344 million (charge to equity of Ch$30,342 million in
2018). The income tax effect presented a credit to equity of Ch$6,843 million (credit of Ch$8,192 million in June 2018).
The valuation adjustment of
investments available for sale originates from fluctuations in the fair value of such portfolio, with a charge or credit to equity.
During the period 2019, it was made a credit to equity for Ch$17,677 million (charge of Ch$6,182 million during the year 2018).
The deferred tax effect meant a charge to equity of Ch$4,778 million (credit to equity of Ch$1,667 million in June 2018).
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
28.
|
Interest Revenue and Expenses:
|
|
(a)
|
On the closing date of the Financial Statement, the
interest and indexation income, excluding hedge results, are composed as follows:
|
|
|
June 2019
|
|
|
June 2018
|
|
|
|
Interest
|
|
|
UF
Indexation
|
|
|
Prepaid fees
|
|
|
Total
|
|
|
Interest
|
|
|
UF
Indexation
|
|
|
Prepaid fees
|
|
|
Total
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial loans
|
|
|
371,881
|
|
|
|
71,266
|
|
|
|
4,607
|
|
|
|
447,754
|
|
|
|
336,403
|
|
|
|
70,089
|
|
|
|
2,309
|
|
|
|
408,801
|
|
Consumer loans
|
|
|
313,721
|
|
|
|
747
|
|
|
|
4,789
|
|
|
|
319,257
|
|
|
|
296,521
|
|
|
|
905
|
|
|
|
4,156
|
|
|
|
301,582
|
|
Residential mortgage loans
|
|
|
146,991
|
|
|
|
101,318
|
|
|
|
2,192
|
|
|
|
250,501
|
|
|
|
140,064
|
|
|
|
99,102
|
|
|
|
2,571
|
|
|
|
241,737
|
|
Financial investment
|
|
|
18,085
|
|
|
|
3,119
|
|
|
|
—
|
|
|
|
21,204
|
|
|
|
19,926
|
|
|
|
6,296
|
|
|
|
—
|
|
|
|
26,222
|
|
Repurchase agreements
|
|
|
1,310
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,310
|
|
|
|
1,374
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,374
|
|
Loans to banks
|
|
|
14,922
|
|
|
|
—
|
|
|
|
—
|
|
|
|
14,922
|
|
|
|
9,800
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,800
|
|
Other interest and indexation revenue
|
|
|
6,707
|
|
|
|
860
|
|
|
|
—
|
|
|
|
7,567
|
|
|
|
3,379
|
|
|
|
945
|
|
|
|
—
|
|
|
|
4,324
|
|
Total
|
|
|
873,617
|
|
|
|
177,310
|
|
|
|
11,588
|
|
|
|
1,062,515
|
|
|
|
807,467
|
|
|
|
177,337
|
|
|
|
9,036
|
|
|
|
993,840
|
|
The amount of interest recognized
on a received basis for impaired portfolio in the period 2019 amounts to Ch$2,253 million (Ch$2,293 million in June 2018).
|
(b)
|
At the each period end, the stock of interest and UF
indexation not recognized in income is the following:
|
|
|
June 2019
|
|
|
June 2018
|
|
|
|
Interest
|
|
|
UF
Indexation
|
|
|
Total
|
|
|
Interest
|
|
|
UF
Indexation
|
|
|
Total
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial loans
|
|
|
8,379
|
|
|
|
1,090
|
|
|
|
9,469
|
|
|
|
6,807
|
|
|
|
921
|
|
|
|
7,728
|
|
Residential mortgage loans
|
|
|
2,419
|
|
|
|
1,491
|
|
|
|
3,910
|
|
|
|
3,063
|
|
|
|
1,628
|
|
|
|
4,691
|
|
Consumer loans
|
|
|
19
|
|
|
|
—
|
|
|
|
19
|
|
|
|
39
|
|
|
|
—
|
|
|
|
39
|
|
Total
|
|
|
10,817
|
|
|
|
2,581
|
|
|
|
13,398
|
|
|
|
9,909
|
|
|
|
2,549
|
|
|
|
12,458
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
28.
|
Interest Revenue and Expenses, continued:
|
|
(c)
|
At each period end, interest and UF indexation expenses
excluding hedge results, are detailed as follows:
|
|
|
June 2019
|
|
|
June 2018
|
|
|
|
Interest
|
|
|
UF
Indexation
|
|
|
Total
|
|
|
Interest
|
|
|
UF
Indexation
|
|
|
Total
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Savings accounts and time deposits
|
|
|
144,532
|
|
|
|
22,802
|
|
|
|
167,334
|
|
|
|
120,225
|
|
|
|
21,969
|
|
|
|
142,194
|
|
Debt securities issued
|
|
|
103,496
|
|
|
|
74,207
|
|
|
|
177,703
|
|
|
|
96,049
|
|
|
|
71,925
|
|
|
|
167,974
|
|
Other financial obligations
|
|
|
450
|
|
|
|
24
|
|
|
|
474
|
|
|
|
714
|
|
|
|
65
|
|
|
|
779
|
|
Repurchase agreements
|
|
|
3,503
|
|
|
|
—
|
|
|
|
3,503
|
|
|
|
3,572
|
|
|
|
—
|
|
|
|
3,572
|
|
Obligations with banks
|
|
|
21,825
|
|
|
|
—
|
|
|
|
21,825
|
|
|
|
11,316
|
|
|
|
1
|
|
|
|
11,317
|
|
Demand deposits
|
|
|
366
|
|
|
|
4,740
|
|
|
|
5,106
|
|
|
|
128
|
|
|
|
3,795
|
|
|
|
3,923
|
|
Lease liabilities
|
|
|
1,192
|
|
|
|
—
|
|
|
|
1,192
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Other interest and indexation expenses
|
|
|
36
|
|
|
|
183
|
|
|
|
219
|
|
|
|
18
|
|
|
|
314
|
|
|
|
332
|
|
Total
|
|
|
275,400
|
|
|
|
101,956
|
|
|
|
377,356
|
|
|
|
232,022
|
|
|
|
98,069
|
|
|
|
330,091
|
|
|
(d)
|
As of June 30, 2019 and 2018, the Bank uses cross currency
and interest rate swaps to hedge its position on movements on the fair value of corporate bonds and commercial loans and cross
currency swaps to hedge the risk of variability of obligations flows with foreign banks and bonds issued in foreign currency.
|
|
|
June 2019
|
|
|
June 2018
|
|
|
|
Income
|
|
|
Expense
|
|
|
Total
|
|
|
Income
|
|
|
Expense
|
|
|
Total
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain from fair value accounting hedges
|
|
|
386
|
|
|
|
—
|
|
|
|
386
|
|
|
|
2,463
|
|
|
|
—
|
|
|
|
2,463
|
|
Loss from fair value accounting hedges
|
|
|
(8,550
|
)
|
|
|
—
|
|
|
|
(8,550
|
)
|
|
|
(1,039
|
)
|
|
|
—
|
|
|
|
(1,039
|
)
|
Gain from cash flow accounting hedges
|
|
|
153,012
|
|
|
|
151,699
|
|
|
|
304,711
|
|
|
|
159,276
|
|
|
|
175,729
|
|
|
|
335,005
|
|
Loss from cash flow accounting hedges
|
|
|
(179,594
|
)
|
|
|
(138,926
|
)
|
|
|
(318,520
|
)
|
|
|
(186,479
|
)
|
|
|
(163,939
|
)
|
|
|
(350,418
|
)
|
Net gain on hedge items
|
|
|
3,914
|
|
|
|
—
|
|
|
|
3,914
|
|
|
|
(2,230
|
)
|
|
|
—
|
|
|
|
(2,230
|
)
|
Total
|
|
|
(30,832
|
)
|
|
|
12,773
|
|
|
|
(18,059
|
)
|
|
|
(28,009
|
)
|
|
|
11,790
|
|
|
|
(16,219
|
)
|
|
(e)
|
At each period end, the summary of interest is as follows:
|
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Interest revenue
|
|
|
1,062,515
|
|
|
|
993,840
|
|
Interest expense
|
|
|
(377,356
|
)
|
|
|
(330,091
|
)
|
|
|
|
|
|
|
|
|
|
Subtotal interest income
|
|
|
685,159
|
|
|
|
663,749
|
|
|
|
|
|
|
|
|
|
|
Net gain (loss) from accounting hedges
|
|
|
(18,059
|
)
|
|
|
(16,219
|
)
|
|
|
|
|
|
|
|
|
|
Total net interest income
|
|
|
667,100
|
|
|
|
647,530
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
29.
|
Income and Expenses from Fees and Commissions:
|
The income and expenses for
commissions that are shown in the Interim Consolidated Statements of Income for the period refers to the following items:
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
Commission income
|
|
|
|
|
|
|
Debit and credit card services
|
|
|
93,363
|
|
|
|
82,952
|
|
Investments in mutual funds and others
|
|
|
49,313
|
|
|
|
44,539
|
|
Collections and payments
|
|
|
27,693
|
|
|
|
25,850
|
|
Portfolio management
|
|
|
23,089
|
|
|
|
22,343
|
|
Use of distribution channel
|
|
|
19,377
|
|
|
|
10,330
|
|
Fees for insurance transactions
|
|
|
18,343
|
|
|
|
16,258
|
|
Guarantees and letters of credit
|
|
|
12,882
|
|
|
|
12,160
|
|
Trading and securities management
|
|
|
11,953
|
|
|
|
14,125
|
|
Brand use agreement
|
|
|
8,060
|
|
|
|
7,365
|
|
Lines of credit and overdrafts
|
|
|
2,376
|
|
|
|
2,430
|
|
Financial advisory services
|
|
|
1,490
|
|
|
|
1,438
|
|
Other commission earned
|
|
|
11,732
|
|
|
|
9,408
|
|
Total commissions income
|
|
|
279,671
|
|
|
|
249,198
|
|
|
|
|
|
|
|
|
|
|
Commission expenses
|
|
|
|
|
|
|
|
|
Credit card transactions
|
|
|
(47,448
|
)
|
|
|
(54,205
|
)
|
Interbank transactions
|
|
|
(9,526
|
)
|
|
|
(7,545
|
)
|
Collections and payments
|
|
|
(3,267
|
)
|
|
|
(3,289
|
)
|
Securities transactions
|
|
|
(3,134
|
)
|
|
|
(4,366
|
)
|
Sales force
|
|
|
(164
|
)
|
|
|
(96
|
)
|
Other commission
|
|
|
(488
|
)
|
|
|
(473
|
)
|
Total commissions expenses
|
|
|
(64,027
|
)
|
|
|
(69,974
|
)
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
30.
|
Net Financial Operating Income:
|
The gains (losses)
from trading and brokerage activities are detailed as follows:
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Financial assets held-for-trading
|
|
|
45,282
|
|
|
|
27,763
|
|
Sale of available-for-sale instruments
|
|
|
3,088
|
|
|
|
1,620
|
|
Sale of loan portfolios (Note No.12 (e))
|
|
|
2,549
|
|
|
|
—
|
|
Net income on other transactions
|
|
|
(103
|
)
|
|
|
270
|
|
Trading derivative
|
|
|
(7,385
|
)
|
|
|
22,488
|
|
Total
|
|
|
43,431
|
|
|
|
52,141
|
|
|
31.
|
Foreign Exchange Transactions, Net:
|
Net
foreign exchange transactions are detailed as follows:
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Indexed foreign currency
|
|
|
57,018
|
|
|
|
(48,943
|
)
|
Exchange difference, net
|
|
|
(1,773
|
)
|
|
|
4,073
|
|
Gain from accounting hedges
|
|
|
(22,854
|
)
|
|
|
52,143
|
|
Total
|
|
|
32,391
|
|
|
|
7,273
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
32.
|
Provisions for Loan
Losses:
|
The change registered in income
during the periods 2019 and 2018 due to provisions, are summarized as follows:
|
|
|
|
|
Loans to customers
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans and advance to banks
|
|
|
Commercial Loans
|
|
|
Mortgage Loans
|
|
|
Consumer Loans
|
|
|
Subtotal
|
|
|
Contingent Loans
|
|
|
Total
|
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Provisions established:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- Individual provisions
|
|
|
—
|
|
|
|
(583
|
)
|
|
|
(8,178
|
)
|
|
|
(573
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(8,178
|
)
|
|
|
(573
|
)
|
|
|
(1,517
|
)
|
|
|
(2,118
|
)
|
|
|
(9,695
|
)
|
|
|
(3,274
|
)
|
- Group provisions
|
|
|
—
|
|
|
|
—
|
|
|
|
(27,314
|
)
|
|
|
(29,679
|
)
|
|
|
(3,814
|
)
|
|
|
—
|
|
|
|
(139,736
|
)
|
|
|
(117,320
|
)
|
|
|
(170,864
|
)
|
|
|
(146,999
|
)
|
|
|
(1,153
|
)
|
|
|
(1,041
|
)
|
|
|
(172,017
|
)
|
|
|
(148,040
|
)
|
Provisions established, net
|
|
|
—
|
|
|
|
(583
|
)
|
|
|
(35,492
|
)
|
|
|
(30,252
|
)
|
|
|
(3,814
|
)
|
|
|
—
|
|
|
|
(139,736
|
)
|
|
|
(117,320
|
)
|
|
|
(179,042
|
)
|
|
|
(147,572
|
)
|
|
|
(2,670
|
)
|
|
|
(3,159
|
)
|
|
|
(181,712
|
)
|
|
|
(151,314
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provisions released:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- Individual provisions
|
|
|
222
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
222
|
|
|
|
—
|
|
- Group provisions
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
408
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
408
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
408
|
|
Provisions realeased, net
|
|
|
222
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
408
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
408
|
|
|
|
—
|
|
|
|
—
|
|
|
|
222
|
|
|
|
408
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision, net
|
|
|
222
|
|
|
|
(583
|
)
|
|
|
(35,492
|
)
|
|
|
(30,252
|
)
|
|
|
(3,814
|
)
|
|
|
408
|
|
|
|
(139,736
|
)
|
|
|
(117,320
|
)
|
|
|
(179,042
|
)
|
|
|
(147,164
|
)
|
|
|
(2,670
|
)
|
|
|
(3,159
|
)
|
|
|
(181,490
|
)
|
|
|
(150,906
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional provision
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Recovery of written-off assets
|
|
|
—
|
|
|
|
—
|
|
|
|
5,727
|
|
|
|
6,772
|
|
|
|
2,748
|
|
|
|
1,826
|
|
|
|
15,900
|
|
|
|
17,553
|
|
|
|
24,375
|
|
|
|
26,151
|
|
|
|
—
|
|
|
|
—
|
|
|
|
24,375
|
|
|
|
26,151
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for loan losses, net
|
|
|
222
|
|
|
|
(583
|
)
|
|
|
(29,765
|
)
|
|
|
(23,480
|
)
|
|
|
(1,066
|
)
|
|
|
2,234
|
|
|
|
(123,836
|
)
|
|
|
(99,767
|
)
|
|
|
(154,667
|
)
|
|
|
(121,013
|
)
|
|
|
(2,670
|
)
|
|
|
(3,159
|
)
|
|
|
(157,115
|
)
|
|
|
(124,755
|
)
|
In the opinion of the Administration,
provisions constituting for credit risk cover all possible losses that may arise from the non-recovery of assets, according to
the records examined by the Bank.
The detail of the amounts
presented in the Interim Consolidated Statement of Cash Flow is as follows:
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Allowances established of loans to customer and loans and advances to banks
|
|
|
(179,042
|
)
|
|
|
(148,155
|
)
|
Allowances released of loans to customer and loans and advances to banks
|
|
|
222
|
|
|
|
408
|
|
Total allowances of loans to customer and loans and advances to banks
|
|
|
(178,820
|
)
|
|
|
(147,747
|
)
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
Salaries and personnel expenses
during the periods 2019 and 2018 are as follows:
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Remunerations
|
|
|
126,997
|
|
|
|
120,550
|
|
Bonuses and incentives
|
|
|
30,092
|
|
|
|
24,525
|
|
Variable compensation
|
|
|
17,556
|
|
|
|
17,039
|
|
Staff severance indemnities
|
|
|
15,508
|
|
|
|
9,869
|
|
Gratifications
|
|
|
13,959
|
|
|
|
13,123
|
|
Lunch and health benefits
|
|
|
13,783
|
|
|
|
13,606
|
|
Training expenses
|
|
|
1,785
|
|
|
|
2,080
|
|
Other personnel expenses
|
|
|
9,247
|
|
|
|
9,106
|
|
Total
|
|
|
228,927
|
|
|
|
209,898
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
34.
|
Administrative Expenses:
|
This item is composed as follows:
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
General administrative expenses
|
|
|
|
|
|
|
Information technology and communications
|
|
|
42,621
|
|
|
|
36,358
|
|
Maintenance and repair of property and equipment
|
|
|
21,347
|
|
|
|
17,171
|
|
External advisory services and professional services fees
|
|
|
6,906
|
|
|
|
9,151
|
|
Surveillance and securities transport services
|
|
|
5,869
|
|
|
|
5,878
|
|
Office supplies
|
|
|
5,321
|
|
|
|
4,218
|
|
Expenses for short-term leases and low value (*)
|
|
|
3,335
|
|
|
|
—
|
|
Energy, heating and other utilities
|
|
|
2,911
|
|
|
|
3,006
|
|
Postal box, mail , postage and home delivery services
|
|
|
2,897
|
|
|
|
2,596
|
|
External service of financial information
|
|
|
2,824
|
|
|
|
2,443
|
|
Insurance premiums
|
|
|
2,583
|
|
|
|
2,774
|
|
Legal and notary expenses
|
|
|
1,779
|
|
|
|
1,744
|
|
Representation and travel expenses
|
|
|
1,779
|
|
|
|
1,911
|
|
External service of custody of documentation
|
|
|
1,592
|
|
|
|
1,478
|
|
Other expenses of obligations for lease agreements (*)
|
|
|
1,363
|
|
|
|
—
|
|
Donations
|
|
|
1,239
|
|
|
|
1,210
|
|
Office rental and equipment and ATM (*)
|
|
|
—
|
|
|
|
17,317
|
|
Other general administrative expenses
|
|
|
9,261
|
|
|
|
9,374
|
|
Subtotal
|
|
|
113,627
|
|
|
|
116,629
|
|
|
|
|
|
|
|
|
|
|
Outsource services
|
|
|
|
|
|
|
|
|
Credit pre-evaluation
|
|
|
12,421
|
|
|
|
9,584
|
|
Data processing
|
|
|
5,177
|
|
|
|
4,131
|
|
External technological developments expenses
|
|
|
4,202
|
|
|
|
4,541
|
|
Certification and technology testing
|
|
|
3,687
|
|
|
|
3,192
|
|
Other
|
|
|
1,991
|
|
|
|
1,790
|
|
Subtotal
|
|
|
27,478
|
|
|
|
23,238
|
|
|
|
|
|
|
|
|
|
|
Board expenses
|
|
|
|
|
|
|
|
|
Board of Directors Compensation
|
|
|
1,253
|
|
|
|
1,230
|
|
Other Board expenses
|
|
|
120
|
|
|
|
159
|
|
Subtotal
|
|
|
1,373
|
|
|
|
1,389
|
|
|
|
|
|
|
|
|
|
|
Marketing expenses
|
|
|
|
|
|
|
|
|
Advertising
|
|
|
15,994
|
|
|
|
13,533
|
|
Subtotal
|
|
|
15,994
|
|
|
|
13,533
|
|
|
|
|
|
|
|
|
|
|
Taxes, payroll taxes and contributions
|
|
|
|
|
|
|
|
|
Contribution to the banking regulator
|
|
|
5,045
|
|
|
|
4,722
|
|
Real estate contributions
|
|
|
1,422
|
|
|
|
1,385
|
|
Patents
|
|
|
658
|
|
|
|
643
|
|
Other taxes
|
|
|
726
|
|
|
|
634
|
|
Subtotal
|
|
|
7,851
|
|
|
|
7,384
|
|
Total
|
|
|
166,323
|
|
|
|
162,173
|
|
(*) See Note No.
3 Adoption of IFRS 16 “Leases”.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
35.
|
Depreciation, Amortization and Impairment:
|
|
(a)
|
The amounts corresponding to charges to results for
depreciation and amortization during the periods 2019 and 2018, are detailed as follows:
|
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
Depreciation and amortization
|
|
|
|
|
|
|
Depreciation of property and equipment (Note No. 16 (b))
|
|
|
14,681
|
|
|
|
13,450
|
|
Depreciation of rights over leased assets (Note No. 16 (d))(*)
|
|
|
13,891
|
|
|
|
—
|
|
Amortization of intangibles assets (Note No. 15 (b))
|
|
|
6,093
|
|
|
|
5,021
|
|
Total
|
|
|
34,665
|
|
|
|
18,471
|
|
|
(*)
|
See Note No. 3 Adoption of IFRS 16 “Leases”.
|
|
(b)
|
As of June 30, 2019 and 2018 the impairment expenses
is composed as follows:
|
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
Impairment
|
|
|
|
|
|
|
Impairment of intangible assets (Note No. 15 (b))
|
|
|
—
|
|
|
|
—
|
|
Impairment of properties and equipment (Note No. 16 (b))
|
|
|
822
|
|
|
|
11
|
|
Impairment of rights over leased assets (Note No. 16 (d))
|
|
|
—
|
|
|
|
—
|
|
Total
|
|
|
822
|
|
|
|
11
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
36.
|
Other Operating Income:
|
During the periods 2019 and
2018, the Bank and its subsidiaries present other operating income, according to the following:
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
Income for assets received in lieu of payment
|
|
|
|
|
|
|
|
|
Income from sale of assets received in lieu of payment
|
|
|
6,358
|
|
|
|
2,723
|
|
Other income
|
|
|
15
|
|
|
|
15
|
|
Subtotal
|
|
|
6,373
|
|
|
|
2,738
|
|
|
|
|
|
|
|
|
|
|
Release of provisions for contingencies
|
|
|
|
|
|
|
|
|
Country risk provisions
|
|
|
—
|
|
|
|
—
|
|
Other provisions for contingencies
|
|
|
—
|
|
|
|
—
|
|
Subtotal
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
Other income
|
|
|
|
|
|
|
|
|
Release and expense recovery
|
|
|
6,655
|
|
|
|
2,100
|
|
Rental income
|
|
|
4,310
|
|
|
|
4,485
|
|
Recovery from correspondent banks
|
|
|
1,360
|
|
|
|
1,143
|
|
Income from sale leased assets
|
|
|
748
|
|
|
|
843
|
|
Revaluation of prepaid monthly payments
|
|
|
420
|
|
|
|
255
|
|
Insurance policy reimbursement
|
|
|
346
|
|
|
|
17
|
|
Fiduciary and trustee commissions
|
|
|
158
|
|
|
|
105
|
|
Gain on sale of property and equipment
|
|
|
43
|
|
|
|
3,580
|
|
Tax management income
|
|
|
42
|
|
|
|
14
|
|
Foreign trade income
|
|
|
41
|
|
|
|
4
|
|
Others
|
|
|
3,850
|
|
|
|
780
|
|
Subtotal
|
|
|
17,973
|
|
|
|
13,326
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
24,346
|
|
|
|
16,064
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
37.
|
Other Operating Expenses:
|
During the periods 2019 and
2018, the Bank and its subsidiaries present other operating expenses, according to the following:
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
Provisions and expenses for assets received in lieu of payment
|
|
|
|
|
|
|
Charge-off assets received in lieu of payment
|
|
|
3,769
|
|
|
|
1,842
|
|
Provisions for assets received in lieu of payment
|
|
|
784
|
|
|
|
1,798
|
|
Expenses to maintain assets received in lieu of payment
|
|
|
663
|
|
|
|
482
|
|
Subtotal
|
|
|
5,216
|
|
|
|
4,122
|
|
|
|
|
|
|
|
|
|
|
Provisions for contingencies
|
|
|
|
|
|
|
|
|
Country risk provisions
|
|
|
7,086
|
|
|
|
5,684
|
|
Other provisions
|
|
|
35
|
|
|
|
95
|
|
Subtotal
|
|
|
7,121
|
|
|
|
5,779
|
|
|
|
|
|
|
|
|
|
|
Other expenses
|
|
|
|
|
|
|
|
|
Leasings operational expenses
|
|
|
2,321
|
|
|
|
1,993
|
|
Write-offs for operating risks
|
|
|
2,122
|
|
|
|
8,628
|
|
Card administration
|
|
|
973
|
|
|
|
1,238
|
|
Provision on others assets
|
|
|
966
|
|
|
|
430
|
|
Correspondent banks
|
|
|
748
|
|
|
|
402
|
|
Expenses for charge-off leased assets recoveries
|
|
|
269
|
|
|
|
1,212
|
|
Credit life insurance
|
|
|
154
|
|
|
|
139
|
|
Contribution to other organisms
|
|
|
132
|
|
|
|
134
|
|
Civil lawsuits
|
|
|
52
|
|
|
|
67
|
|
Others
|
|
|
1,712
|
|
|
|
1,182
|
|
Subtotal
|
|
|
9,449
|
|
|
|
15,425
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
21,786
|
|
|
|
25,326
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
38.
|
Related Party Transactions:
|
Related parties are considered
to be those natural or legal persons who are in positions to directly or indirectly have significant influence through their ownership
or management of the Bank and its subsidiaries, as set out in the Compendium of Accounting Standards and Chapter 12-4 of the current
Compilation of Standards issued by the CMF.
According to the above, the
Bank has considered as related parties those natural or legal persons who have a direct participation or through third parties
on Bank ownership, where such participation exceeds 5% of the shares, and also people who, regardless of ownership, have authority
and responsibility for planning, management and control of the activities of the entity or its subsidiaries. There also are considered
as related the companies in which the parties related by ownership or management of the Bank have a share which reaches or exceeds
5%, or has the position of director, general manager or equivalent.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
38.
|
Related Party Transactions, continued:
|
|
(a)
|
Loans to related parties:
|
The
following are the loans and accounts receivable and contingent loans, corresponding to related entities.
|
|
Production and
Services
Companies (*)
|
|
|
Investment and
Commercial
Companies (**)
|
|
|
Individuals (***)
|
|
|
Total
|
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Loans and accounts receivable:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial loans
|
|
|
185,339
|
|
|
|
221,351
|
|
|
|
145,476
|
|
|
|
132,366
|
|
|
|
11,797
|
|
|
|
13,183
|
|
|
|
342,612
|
|
|
|
366,900
|
|
Residential mortgage loans
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
47,858
|
|
|
|
44,756
|
|
|
|
47,858
|
|
|
|
44,756
|
|
Consumer loans
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,485
|
|
|
|
10,074
|
|
|
|
9,485
|
|
|
|
10,074
|
|
Gross loans
|
|
|
185,339
|
|
|
|
221,351
|
|
|
|
145,476
|
|
|
|
132,366
|
|
|
|
69,140
|
|
|
|
68,013
|
|
|
|
399,955
|
|
|
|
421,730
|
|
Allowance for loan losses
|
|
|
(738
|
)
|
|
|
(962
|
)
|
|
|
(277
|
)
|
|
|
(242
|
)
|
|
|
(318
|
)
|
|
|
(379
|
)
|
|
|
(1,333
|
)
|
|
|
(1,583
|
)
|
Net loans
|
|
|
184,601
|
|
|
|
220,389
|
|
|
|
145,199
|
|
|
|
132,124
|
|
|
|
68,822
|
|
|
|
67,634
|
|
|
|
398,622
|
|
|
|
420,147
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contingent loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Guarantees and sureties
|
|
|
4,993
|
|
|
|
5,102
|
|
|
|
7,852
|
|
|
|
14,963
|
|
|
|
—
|
|
|
|
—
|
|
|
|
12,845
|
|
|
|
20,065
|
|
Letters of credits
|
|
|
918
|
|
|
|
5,310
|
|
|
|
392
|
|
|
|
2,776
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,310
|
|
|
|
8,086
|
|
Foreign letters of credits
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Banks guarantees
|
|
|
11,560
|
|
|
|
45,842
|
|
|
|
34,363
|
|
|
|
30,122
|
|
|
|
—
|
|
|
|
—
|
|
|
|
45,923
|
|
|
|
75,964
|
|
Freely disposition credit lines
|
|
|
47,326
|
|
|
|
58,041
|
|
|
|
14,202
|
|
|
|
14,674
|
|
|
|
20,425
|
|
|
|
19,160
|
|
|
|
81,953
|
|
|
|
91,875
|
|
Other contingencies loans
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Total contingent loans
|
|
|
64,797
|
|
|
|
114,295
|
|
|
|
56,809
|
|
|
|
62,535
|
|
|
|
20,425
|
|
|
|
19,160
|
|
|
|
142,031
|
|
|
|
195,990
|
|
Provision for contingencies loans
|
|
|
(167
|
)
|
|
|
(258
|
)
|
|
|
(47
|
)
|
|
|
(99
|
)
|
|
|
(32
|
)
|
|
|
(30
|
)
|
|
|
(246
|
)
|
|
|
(387
|
)
|
Contingent loans, net
|
|
|
64,630
|
|
|
|
114,037
|
|
|
|
56,762
|
|
|
|
62,436
|
|
|
|
20,393
|
|
|
|
19,130
|
|
|
|
141,785
|
|
|
|
195,603
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amount covered by guarantee:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage
|
|
|
30,331
|
|
|
|
28,208
|
|
|
|
59,837
|
|
|
|
52,108
|
|
|
|
66,652
|
|
|
|
69,292
|
|
|
|
156,820
|
|
|
|
149,608
|
|
Warrant
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Pledge
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Others (****)
|
|
|
31,212
|
|
|
|
47,135
|
|
|
|
13,364
|
|
|
|
13,219
|
|
|
|
3,966
|
|
|
|
3,694
|
|
|
|
48,542
|
|
|
|
64,048
|
|
Total collateral
|
|
|
61,543
|
|
|
|
75,343
|
|
|
|
73,201
|
|
|
|
65,327
|
|
|
|
70,618
|
|
|
|
72,986
|
|
|
|
205,362
|
|
|
|
213,656
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
38.
|
Related Party Transactions, continued:
|
|
(a)
|
Loans with related parties, continued:
|
|
(*)
|
For these effects are considered productive companies,
those that meet the following conditions:
|
|
i)
|
They engage in production activities and generate a separate
flow of income.
|
|
ii)
|
Less than 50% of their assets are financial assets held-for-trading or investments.
|
Service companies are considered
entities whose main purpose is oriented to rendering services to third parties.
|
(**)
|
Investment companies and commercial include those
legal entities that do not meet the conditions for productive companies or services providers and are profit-oriented.
|
|
(***)
|
Individuals include key members of the management
and correspond to those who directly or indirectly have authority and responsibility for planning, administrating and controlling
the activities of the organization, including directors. This category also includes their family members who influence or are
influenced by such individuals in their interactions with the organization.
|
|
(****)
|
These guarantees mainly correspond to shares and other
financial guarantees.
|
|
(b)
|
Other assets and liabilities with related parties:
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
Assets
|
|
|
|
|
|
|
Cash and due from banks
|
|
|
18,478
|
|
|
|
23,086
|
|
Transactions in the course of collection
|
|
|
20,726
|
|
|
|
35,469
|
|
Financial assets held-for-trading
|
|
|
126
|
|
|
|
205
|
|
Derivative instruments
|
|
|
198,836
|
|
|
|
415,683
|
|
Financial assets
|
|
|
10,900
|
|
|
|
14,690
|
|
Other assets
|
|
|
50,924
|
|
|
|
80,569
|
|
Total
|
|
|
299,990
|
|
|
|
569,702
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
Demand deposits
|
|
|
149,034
|
|
|
|
169,607
|
|
Transactions in the course of payment
|
|
|
316,757
|
|
|
|
58,987
|
|
Repurchase agreements
|
|
|
7,166
|
|
|
|
84,465
|
|
Savings accounts and time deposits
|
|
|
303,119
|
|
|
|
219,322
|
|
Derivative instruments
|
|
|
204,646
|
|
|
|
337,299
|
|
Borrowings with banks
|
|
|
295,225
|
|
|
|
228,269
|
|
Other liabilities
|
|
|
31,109
|
|
|
|
115,145
|
|
Total
|
|
|
1,307,056
|
|
|
|
1,213,094
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
38.
|
Related Party Transactions, continued:
|
|
(c)
|
Income and expenses from related party transactions
(*):
|
|
|
June 2019
|
|
|
June 2018
|
|
|
|
Income
|
|
|
Expense
|
|
|
Income
|
|
|
Expense
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Type of income or expense recognized
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and revenue expenses
|
|
|
9,851
|
|
|
|
2,871
|
|
|
|
10,681
|
|
|
|
3,682
|
|
Fees and commissions income
|
|
|
35,662
|
|
|
|
31,393
|
|
|
|
33,223
|
|
|
|
35,689
|
|
Net Financial Operating Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivative instruments (**)
|
|
|
21,297
|
|
|
|
19,583
|
|
|
|
58,974
|
|
|
|
8,854
|
|
Other financial operations
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Released or established of provision for credit risk
|
|
|
294
|
|
|
|
—
|
|
|
|
—
|
|
|
|
209
|
|
Operating expenses
|
|
|
—
|
|
|
|
68,821
|
|
|
|
—
|
|
|
|
60,095
|
|
Other income and expenses
|
|
|
311
|
|
|
|
18
|
|
|
|
220
|
|
|
|
25
|
|
|
(*)
|
This detail does not constitute a Statement of Comprehensive
Income for related party transactions since the assets with these parties are not necessarily equal to liabilities and each item
reflects total income and expense and not those corresponding to exact transactions.
|
|
(**)
|
The outcome of derivative operations is presented
net at each related counterparty level. Additionally, this line includes operations with local counterpart banks (unrelated) which
have been novated by Comder Contraparte Central S.A. (Related entity) for centralized clearing purposes, which generated a net
gain of Ch$5,518 million as of June 30, 2019 (net gain of Ch$51,596 million as of June 30, 2018).
|
|
(d)
|
Contracts with related parties:
|
During
the period ended June 30, 2019, the Bank has signed, renewed or amended the contractual terms and conditions of the following contracts
with related parties that do not correspond to the ordinary transactions with clients in general, for above UF 1,000:
Company name
|
|
Concept or service description
|
Servipag Ltda.
|
|
Development of systems and collection and payment services
|
Canal 13 S.A.
|
|
Advertising service
|
Redbanc S.A.
|
|
ATM configuration services
|
DCV Registros S.A.
|
|
Shareholders’ Meeting Management Service
|
Asociación de Bancos e Instituciones Financieras
|
|
Membership fee
|
Sociedad de Fomento Fabril
|
|
Cooperation agreement for the operation of the network of inclusive companies
|
Fundacion Chilena del Pacífico
|
|
Sponsorship of SMEs summit and entrepreneurs of Asia-Pacific Economic Cooperation (APEC)
|
Transbank S.A.
|
|
Operation contract Discover and Diners cards
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
38.
|
Related Party Transactions, continued:
|
|
(e)
|
Directors’ expenses and remunerations and payments
to key management personnel:
|
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
Personnel remunerations
|
|
|
1,966
|
|
|
|
2,045
|
|
Short-term benefits
|
|
|
3,037
|
|
|
|
3,230
|
|
Severance pay
|
|
|
—
|
|
|
|
870
|
|
Directors’ remunerations and fees (*)
|
|
|
1,253
|
|
|
|
1,230
|
|
Total
|
|
|
6,256
|
|
|
|
7,375
|
|
(*) It includes fees paid to
members of the Advisory Committee of Banchile Corredores de Seguros Ltda, of Ch$7 million (Ch$6 million in June 2018).
Fees paid to the advisors of
the Board of Directors amount to Ch$75 million (Ch$132 million in June 2018) and travel and other related expenses amount to Ch$45
million (Ch$27 million in June 2018).
Composition
of key personnel:
|
|
No. of executives
|
|
|
|
June
|
|
|
June
|
|
|
|
2019
|
|
|
2018
|
|
Position
|
|
|
|
|
|
|
CEO
|
|
|
1
|
|
|
|
1
|
|
CEOs of subsidiaries
|
|
|
6
|
|
|
|
6
|
|
Division Managers
|
|
|
13
|
|
|
|
12
|
|
Directors Bank and subsidiaries
|
|
|
21
|
|
|
|
21
|
|
Total
|
|
|
41
|
|
|
|
40
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
39.
|
Fair Value of Financial Assets and Liabilities:
|
Banco de Chile and its subsidiaries
have defined a corporate framework for valuation and control related with the process to the fair value measurement.
Within the established framework
includes the Product Control Unit, which is independent of the business areas and reports to the Financial Management and Control
Division Manager. The Financial Control and Treasury Area, through the Financial Risk Information and Control Section, is responsible
for independent verification of price and results of trading (including derivatives) and investment operations and all fair value
measurements.
To achieve the appropriate
measurements and controls, the Bank and its subsidiaries, take into account at least the following aspects:
|
(i)
|
Industry standard valuation.
|
To value financial instruments,
Banco de Chile uses industry standard modeling; quota value, share price, discounted cash flows and valuation of options through
Black-Scholes-Merton, according to the case. The input parameters for the valuation correspond to rates, prices and levels of volatility
for different terms and market factors that are traded in the national and international market and that are provided by the main
sources of the market.
|
(ii)
|
Quoted prices in active markets.
|
The fair value for instruments
with quoted prices in active markets is determined using daily quotes from electronic systems information (such as Bolsa de Comercio
de Santiago, Bloomberg, LVA and Risk America, etc). This quote represents the price at which these instruments are regularly traded
in the financial markets.
|
(iii)
|
Valuation techniques.
|
If no specific quotes are available
for the instrument to be valued, valuation techniques will be used to determine the fair value.
Due to, in general, the valuation
models require a set of market parameters as inputs, the aim is to maximize information based on observable or price-related quotations
for similar instruments in active markets. To the extent there is no information in direct from the markets, data from external
suppliers of information, prices of similar instruments and historical information are used to validate the valuation parameters.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
39.
|
Fair Value of Financial Assets and Liabilities, continued:
|
|
(iv)
|
Fair value adjustments.
|
Part of the fair value process
considers three adjustments to the market value of each instrument calculated based on the market parameters, including; a liquidity
adjustment, a Bid/Offer adjustment and an adjustment is made for credit risk of derivatives (CVA and DVA). The calculation of the
liquidity adjustment considers the size of the position in each factor, the particular liquidity of each factor, the relative size
of Banco de Chile with respect to the market, and the liquidity observed in transactions recently carried out in the market. In
turn, the Bid/Offer adjustment, represents the impact on the valuation of an instrument depending on whether the position corresponds
to a long (bought) or a short (sold).To calculate this adjustment is used the direct quotes from active markets or indicative prices
or derivatives of similar assets depending on the instrument, considering the Bid, Mid and Offer, respectively. Finally, the adjustment
made for CVA and DVA for derivatives corresponds to the credit risk recognition of the issuer, either of the counterparty (CVA)
or of Banco de Chile (DVA).
Liquidity value adjustments
are made to trading instruments (including derivatives) only, while Bid / Offer adjustments are made for trading instruments and
available for sale. Adjustments for CVA / DVA are carried out only for derivatives.
A process of independent verification
of prices and rates is executed daily, in order to control that the market parameters used by Banco de Chile in the valuation of
the financial instruments relating to the current state of the market and from them the best estimate derived of the fair value.
The objective of this process is to control that the official market parameters provided by the respective business area, before
being entered into the valuation, are within acceptable ranges of differences when compared to the same set of parameters prepared
independently by the Financial Risk Information and Control Section. As a result, value differences are obtained at the level of
currency, product and portfolio. In the event significant differences exist, these differences are scaled according to the amount
of individual materiality of each market factor and aggregated at the portfolio level, according to the grouping levels within
previously defined ranges. These ranges are approved by the Finance, International and Financial Risk Committee.
Complementary and in parallel,
the Financial Risk Information and Control Section generates and reports on a daily basis Profit and Loss (“P&L”)
and Exposure to Market Risks, which allow for proper control and consistency of the parameters used in the valuation.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
39.
|
Fair Value of Financial Assets and Liabilities, continued:
|
|
(vi)
|
Judgmental analysis and information to Management.
|
In particular cases, where there
are no market quotations for the instrument to be valued and there are no prices for similar transactions instruments or indicative
parameters, a specific control and a reasoned analysis must be carried out in order to estimate the fair value of the operation.
Within the valuation framework described in the Reasonable Value Policy (and its procedure) approved by the Board of Directors
of Banco de Chile, a required level of approval is set in order to carry out transactions where market information is not available
or it is not possible to infer prices or rates from it.
|
(a)
|
Hierarchy of instrument valued at Fair value:
|
Banco de Chile and its subsidiaries,
classify all the financial instruments among the following levels:
|
Level 1:
|
These are financial instruments whose fair value is calculated
at quoted prices (unadjusted) in extracted from liquid and deep markets for identical assets or liabilities. For these instruments
there are quotes or prices (return internal rates, quote value, price) the observable market, so that assumptions are not required
to determine the value.
|
In this
level, the following instruments are considered: currency futures, debt instruments issued Chilean Central Bank and Treasury, which
belong to benchmarks, mutual fund investments and equity shares.
For the
instruments of the Central Bank of Chile and the General Treasury of the Republic, all those mnemonics belonging to a Benchmark,
in other words corresponding to one of the following categories published by the Santiago Stock Exchange, will be considered as
Level 1: Pesos-02, Pesos-03, Pesos-04, Pesos-05, Pesos-07, Pesos-10, UF-02, UF-04, UF-05, UF-07, UF-10, UF-20, UF-30. A Benchmark
corresponds to a group of mnemonics that are similar in duration and are traded in an equivalent way, i.e., the price (return internal
rates in this case) obtained is the same for all the instruments that make up a Benchmark. This feature defines a greater depth
of market, with daily quotations that allow classifying these instruments as Level 1.
In the case
of debt issued by the Government, the internal rate of return of the market is used to discount all flows to present value. In
the case of mutual funds and equity shares, the current market price per share, which multiplied by the number of instruments results
in the fair value.
The preceding
described valuation methodology is equivalent to the one used by the Bolsa de Comercio de Santiago (Santiago Stock Exchange) and
correspond to the standard methodology used in the market.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
39.
|
Fair Value of Financial Assets and Liabilities, continued:
|
|
Level 2:
|
They are financial instruments whose fair value is
calculated based on prices other than in quoted in Level 1 that are observable for the asset or liability, directly (that is,
as prices or internal rates of return) or indirectly (that is, derived from prices or internal rates of return from similar instruments).
These categories include:
|
|
a)
|
Quoted prices for similar assets or liabilities in active
markets.
|
|
b)
|
Quoted prices for identical or similar assets or liabilities
in markets that are not active.
|
|
c)
|
Inputs data other than quoted prices that are observable
for the asset or liability.
|
|
d)
|
Inputs data corroborated by the market.
|
At this
level there are mainly derivatives instruments, debt issued by banks, debt issues of Chilean and foreign companies, issued in Chile
or abroad, mortgage claims, financial brokerage instruments and some issuances by the Central Bank of Chile and the General Treasury
of the Republic, which do not belong to benchmarks.
To value
derivatives, depends on whether they are impacted by volatility as a relevant market factor in standard valuation methodologies;
for options the Black-Scholes-Merton formula is used; for the rest of the derivatives, forwards and swaps, net present value through
discounted cash flows is used.
For the remaining instruments at this level, as for debt issues of level 1, the valuation is done through cash flows model by using
an internal rate of return that can be derived or estimated from internal rates of return of similar securities as mentioned above.
In the event
that there is no observable price for an instrument in a specific term, the price will be inferred from the interpolation between
periods that have observable quoted price in active markets. These models incorporate various market variables, including the credit
quality of counterparties, exchange rates and interest rate curves.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
39.
|
Fair Value of Financial Assets and Liabilities, continued:
|
Valuation Techniques and Inputs
for Level 2 Instrument:
Type of Financial Instrument
|
|
Valuation Method
|
|
Description: Inputs and Sources
|
Local Bank and
Corporate Bonds
|
|
Discounted cash flows model
|
|
Prices (internal rates of return) are provided by third party
price providers that are widely used in the Chilean market.
Model is based on a Base Yield (Central Bank Bonds) and issuer
spread.
The model is based on daily prices and risk/maturity similarities
between
Instruments.
|
|
|
|
|
|
Offshore Bank and Corporate Bonds
|
|
|
|
Prices are provided by third party price providers that are
widely used in the Chilean market.
Model is based on daily prices.
|
|
|
|
|
|
Local Central Bank
and Treasury Bonds
|
|
|
|
Prices (internal rates of return)are provided by third party
price providers that are widely used in the Chilean market.
Model is based on daily prices.
|
|
|
|
|
|
Mortgage
Notes
|
|
|
|
Prices (internal rates of return) are provided by third party
price providers that are widely used in the Chilean market.
Model is based on a Base Yield (Central Bank Bonds) and issuer
spread.
The model takes into consideration daily prices and risk/maturity
similarities between instruments.
|
|
|
|
|
|
Time
Deposits
|
|
|
|
Prices (internal rates of return) are provided by third party
price providers that are widely used in the Chilean market.
Model is based on daily prices and considers risk/maturity similarities
between instruments.
|
|
|
|
|
|
Cross Currency Swaps,
Interest Rate Swaps,
FX Forwards, Inflation
Forwards
|
|
|
|
Forward Points, Inflation forecast and local swap rates are
provided by market brokers that are widely used in the Chilean market.
Offshore rates and spreads are obtained from third party price
providers that are widely used in the Chilean market.
Zero Coupon rates are calculated by using the bootstrapping
method over swap rates.
|
|
|
|
|
|
FX Options
|
|
Black-Scholes Model
|
|
Prices for volatility surface estimates are obtained from market brokers that are widely used in the Chilean market.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
39.
|
Fair Value of Financial Assets and Liabilities, continued:
|
|
Level 3:
|
These are financial instruments whose fair value is determined
using non-observable inputs data neither for the assets or liabilities under analysis nor for similar instruments. An adjustment
to an input that is significant to the entire measurement can result in a fair value measurement classified within Level 3 of
the fair value hierarchy, if the adjustment uses significant non-observable data entry.
|
The instruments
likely to be classified as level 3 are mainly Corporate Debt by Chilean and foreign companies, issued both in Chile and abroad.
Valuation
Techniques and Inputs for Level 3 Instrument:
Type of Financial Instrument
|
|
Valuation Method
|
|
Description: Inputs and Sources
|
Local Bank and
Corporate Bonds
|
|
Discounted cash
flows model
|
|
Since inputs for these types of securities are not observable by the market, we model interest rate of returns for them based on a Base Yield (Central Bank Bonds) and issuer spread. These inputs (base yield and issuer spread) are provided on a daily basis by third party price providers that are widely used in the Chilean market.
|
|
|
|
|
|
Offshore Bank and Corporate Bonds
|
|
Discounted cash
flows model
|
|
Since inputs for these types of securities are not
observable by the market, we model interest rate of returns for them based on a Base Yield (US-Libor) and issuer spread. These
inputs (base yield and issuer spread) are provided on a weekly basis by third party price providers that are widely used in the
Chilean market.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
39.
|
Fair Value of Financial Assets and Liabilities, continued:
|
The following
table shows the classification by levels, for financial instruments registered at fair value.
|
|
Level 1
|
|
|
Level 2
|
|
|
Level 3
|
|
|
Total
|
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Financial Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial assets held-for-trading
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
From the Chilean Government and Central Bank
|
|
|
310,628
|
|
|
|
178,692
|
|
|
|
1,027,534
|
|
|
|
1,344,780
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,338,162
|
|
|
|
1,523,472
|
|
Other instruments issued in Chile
|
|
|
2,708
|
|
|
|
1,663
|
|
|
|
134,501
|
|
|
|
107,078
|
|
|
|
24,112
|
|
|
|
20,866
|
|
|
|
161,321
|
|
|
|
129,607
|
|
Instruments issued abroad
|
|
|
—
|
|
|
|
4,446
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
4,446
|
|
Mutual fund investments
|
|
|
50,675
|
|
|
|
87,841
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
50,675
|
|
|
|
87,841
|
|
Subtotal
|
|
|
364,011
|
|
|
|
272,642
|
|
|
|
1,162,035
|
|
|
|
1,451,858
|
|
|
|
24,112
|
|
|
|
20,866
|
|
|
|
1,550,158
|
|
|
|
1,745,366
|
|
Derivative contracts for trading purposes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Forwards
|
|
|
—
|
|
|
|
—
|
|
|
|
322,472
|
|
|
|
735,444
|
|
|
|
—
|
|
|
|
—
|
|
|
|
322,472
|
|
|
|
735,444
|
|
Swaps
|
|
|
—
|
|
|
|
—
|
|
|
|
1,096,506
|
|
|
|
738,130
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,096,506
|
|
|
|
738,130
|
|
Call Options
|
|
|
—
|
|
|
|
—
|
|
|
|
1,907
|
|
|
|
4,839
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,907
|
|
|
|
4,839
|
|
Put Options
|
|
|
—
|
|
|
|
—
|
|
|
|
357
|
|
|
|
120
|
|
|
|
—
|
|
|
|
—
|
|
|
|
357
|
|
|
|
120
|
|
Futures
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Subtotal
|
|
|
—
|
|
|
|
—
|
|
|
|
1,421,242
|
|
|
|
1,478,533
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,421,242
|
|
|
|
1,478,533
|
|
Hedge derivative contracts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair value hedge (Swap)
|
|
|
—
|
|
|
|
—
|
|
|
|
46
|
|
|
|
1,116
|
|
|
|
—
|
|
|
|
—
|
|
|
|
46
|
|
|
|
1,116
|
|
Cash flow hedge (Swap)
|
|
|
—
|
|
|
|
—
|
|
|
|
14,476
|
|
|
|
34,298
|
|
|
|
—
|
|
|
|
—
|
|
|
|
14,476
|
|
|
|
34,298
|
|
Subtotal
|
|
|
—
|
|
|
|
—
|
|
|
|
14,522
|
|
|
|
35,414
|
|
|
|
—
|
|
|
|
—
|
|
|
|
14,522
|
|
|
|
35,414
|
|
Financial assets available-for-sale (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
From the Chilean Government and Central Bank
|
|
|
83,359
|
|
|
|
99,132
|
|
|
|
43,291
|
|
|
|
65,090
|
|
|
|
—
|
|
|
|
—
|
|
|
|
126,650
|
|
|
|
164,222
|
|
Other instruments issued in Chile
|
|
|
—
|
|
|
|
—
|
|
|
|
1,076,387
|
|
|
|
747,653
|
|
|
|
22,020
|
|
|
|
23,021
|
|
|
|
1,098,407
|
|
|
|
770,674
|
|
Instruments issued abroad
|
|
|
—
|
|
|
|
—
|
|
|
|
18,120
|
|
|
|
108,544
|
|
|
|
—
|
|
|
|
—
|
|
|
|
18,120
|
|
|
|
108,544
|
|
Subtotal
|
|
|
83,359
|
|
|
|
99,132
|
|
|
|
1,137,798
|
|
|
|
921,287
|
|
|
|
22,020
|
|
|
|
23,021
|
|
|
|
1,243,177
|
|
|
|
1,043,440
|
|
Total
|
|
|
447,370
|
|
|
|
371,774
|
|
|
|
3,735,597
|
|
|
|
3,887,092
|
|
|
|
46,132
|
|
|
|
43,887
|
|
|
|
4,229,099
|
|
|
|
4,302,753
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivative contracts for trading purposes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Forwards
|
|
|
—
|
|
|
|
—
|
|
|
|
278,839
|
|
|
|
631,047
|
|
|
|
—
|
|
|
|
—
|
|
|
|
278,839
|
|
|
|
631,047
|
|
Swaps
|
|
|
—
|
|
|
|
—
|
|
|
|
1,221,392
|
|
|
|
854,873
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,221,392
|
|
|
|
854,873
|
|
Call Options
|
|
|
—
|
|
|
|
—
|
|
|
|
948
|
|
|
|
2,921
|
|
|
|
—
|
|
|
|
—
|
|
|
|
948
|
|
|
|
2,921
|
|
Put Options
|
|
|
—
|
|
|
|
—
|
|
|
|
2,139
|
|
|
|
1,534
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2,139
|
|
|
|
1,534
|
|
Futures
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Subtotal
|
|
|
—
|
|
|
|
—
|
|
|
|
1,503,318
|
|
|
|
1,490,375
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,503,318
|
|
|
|
1,490,375
|
|
Hedge derivative contracts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fair value hedge (Swap)
|
|
|
—
|
|
|
|
—
|
|
|
|
9,017
|
|
|
|
6,164
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,017
|
|
|
|
6,164
|
|
Cash flow hedge (Swap)
|
|
|
—
|
|
|
|
—
|
|
|
|
60,286
|
|
|
|
31,818
|
|
|
|
—
|
|
|
|
—
|
|
|
|
60,286
|
|
|
|
31,818
|
|
Subtotal
|
|
|
—
|
|
|
|
—
|
|
|
|
69,303
|
|
|
|
37,982
|
|
|
|
—
|
|
|
|
—
|
|
|
|
69,303
|
|
|
|
37,982
|
|
Total
|
|
|
—
|
|
|
|
—
|
|
|
|
1,572,621
|
|
|
|
1,528,357
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,572,621
|
|
|
|
1,528,357
|
|
|
(1)
|
As of June 30, 2019, 86% of instruments of level 3 have
denomination “Investment Grade”. Also, 100% of total of these financial instruments correspond to domestic issuers.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
39.
|
Fair Value of Financial Assets and Liabilities, continued:
|
|
(c)
|
Level 3 reconciliation:
|
The following table shows the
reconciliation between the balances at the beginning and at the end of period for those instruments classified in Level 3, whose
fair value is reflected in the Financial Statements:
|
|
As of June 30, 2019
|
|
|
|
Balance as of January 1,
2019
|
|
|
Gain (Loss) Recognized in Income (1)
|
|
|
Gain (Loss) Recognized in Equity (2)
|
|
|
Purchases
|
|
|
Sales
|
|
|
Transfer from Level 1 and 2
|
|
|
Transfer to Level 1 and 2
|
|
|
Balance
as of June 30,
2019
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Financial Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial assets held-for-trading:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other instruments
issued in Chile
|
|
|
20,866
|
|
|
|
(159
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(8,197
|
)
|
|
|
12,217
|
|
|
|
(615
|
)
|
|
|
24,112
|
|
Subtotal
|
|
|
20,866
|
|
|
|
(159
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(8,197
|
)
|
|
|
12,217
|
|
|
|
(615
|
)
|
|
|
24,112
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available-for-Sale Instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other instruments issued
in Chile
|
|
|
23,021
|
|
|
|
(454
|
)
|
|
|
(268
|
)
|
|
|
—
|
|
|
|
(1,503
|
)
|
|
|
1,224
|
|
|
|
—
|
|
|
|
22,020
|
|
Subtotal
|
|
|
23,021
|
|
|
|
(454
|
)
|
|
|
(268
|
)
|
|
|
—
|
|
|
|
(1,503
|
)
|
|
|
1,224
|
|
|
|
—
|
|
|
|
22,020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
43,887
|
|
|
|
(613
|
)
|
|
|
(268
|
)
|
|
|
—
|
|
|
|
(9,700
|
)
|
|
|
13,441
|
|
|
|
(615
|
)
|
|
|
46,132
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of December 31, 2018
|
|
|
|
Balance as of January 1,
2018
|
|
|
Gain (Loss) Recognized in Income (1)
|
|
|
Gain (Loss) Recognized in Equity (2)
|
|
|
Purchases
|
|
|
Sales
|
|
|
Transfer from Level 1 and 2
|
|
|
Transfer to Level 1 and 2
|
|
|
Balance
as of December 31,
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Financial Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial assets held-for-trading:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other instruments
issued in Chile
|
|
|
8,012
|
|
|
|
176
|
|
|
|
—
|
|
|
|
48,740
|
|
|
|
(36,062
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
20,866
|
|
Subtotal
|
|
|
8,012
|
|
|
|
176
|
|
|
|
—
|
|
|
|
48,740
|
|
|
|
(36,062
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
20,866
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Available-for-Sale Instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other instruments issued
in Chile
|
|
|
46,265
|
|
|
|
2,539
|
|
|
|
(292
|
)
|
|
|
—
|
|
|
|
(20,520
|
)
|
|
|
—
|
|
|
|
(4,971
|
)
|
|
|
23,021
|
|
Subtotal
|
|
|
46,265
|
|
|
|
2,539
|
|
|
|
(292
|
)
|
|
|
—
|
|
|
|
(20,520
|
)
|
|
|
—
|
|
|
|
(4,971
|
)
|
|
|
23,021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
54,277
|
|
|
|
2,715
|
|
|
|
(292
|
)
|
|
|
48,740
|
|
|
|
(56,582
|
)
|
|
|
—
|
|
|
|
(4,971
|
)
|
|
|
43,887
|
|
|
(1)
|
Recorded in income under item “Net financial operating
income”.
|
|
(2)
|
Recorded in equity under item “Other Comprehensive
Income”.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
39.
|
Fair Value of Financial Assets and Liabilities, continued:
|
|
(d)
|
Sensitivity of instruments classified in level 3 to
changes in key assumptions of models:
|
The following table shows the
sensitivity, by type of instrument, of those instruments classified in Level 3 using alternative in key valuation assumptions:
|
|
As of June 30, 2019
|
|
|
As of December 31, 2018
|
|
|
|
Level 3
|
|
|
Sensitivity to changes in key assumptions of models
|
|
|
Level 3
|
|
|
Sensitivity to changes in key assumptions of models
|
|
Financial Assets
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Financial assets held-for-trading
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other instruments issued in Chile
|
|
|
24,112
|
|
|
|
(45
|
)
|
|
|
20,866
|
|
|
|
(26
|
)
|
Subtotal
|
|
|
24,112
|
|
|
|
(45
|
)
|
|
|
20,866
|
|
|
|
(26
|
)
|
Available-for- Sale Instruments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other instruments issued in Chile
|
|
|
22,020
|
|
|
|
(149
|
)
|
|
|
23,021
|
|
|
|
(195
|
)
|
Subtotal
|
|
|
22,020
|
|
|
|
(149
|
)
|
|
|
23,021
|
|
|
|
(195
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
46,132
|
|
|
|
(194
|
)
|
|
|
43,887
|
|
|
|
(221
|
)
|
With
the purpose to determine the sensitivity of the financial investments to changes in significant market factors, the Bank has made
alternative calculations at fair value, changing those key parameters for the valuation and which are not directly observable in
screens. In the case of the financial assets listed in the table above, which correspond to Bank Bonds and Corporate Bonds, it
was considered that, since there are no current observables prices, the input prices will be based on brokers’ quotes. The
prices are usually calculated as a base rate plus a spread. For Local Bonds it was determined to apply a 10% impact on the price,
while for the Off Shore Bonds it was determined to apply a 10% impact only on the spread, since the base rate is covered by interest
rate swaps instruments in the so-called accounting hedges. The 10% impact is considered a reasonable move taking into account the
market performance of these instruments and comparing it against the bid / offer adjustment that is provisioned by these instruments.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
39.
|
Fair Value of Financial Assets and Liabilities, continued:
|
|
(e)
|
Other assets and liabilities:
|
The
following table summarizes the fair values of the Bank’s main financial assets and liabilities that are not recorded at fair
value in the Statement of Financial Position. The values shown in this note are not attempt to estimate the value of the Bank’s
income-generating assets, nor forecast their future behavior. The estimated fair value is as follows:
|
|
Book Value
|
|
|
Estimated Fair Value
|
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and due from banks
|
|
|
1,150,682
|
|
|
|
880,081
|
|
|
|
1,150,682
|
|
|
|
880,081
|
|
Transactions in the course of collection
|
|
|
1,023,491
|
|
|
|
580,333
|
|
|
|
1,023,491
|
|
|
|
580,333
|
|
Repurchase agreements and securities lending
|
|
|
93,982
|
|
|
|
97,289
|
|
|
|
93,982
|
|
|
|
97,289
|
|
Subtotal
|
|
|
2,268,155
|
|
|
|
1,557,703
|
|
|
|
2,268,155
|
|
|
|
1,557,703
|
|
Loans and advances to banks
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic banks
|
|
|
104,922
|
|
|
|
99,940
|
|
|
|
104,922
|
|
|
|
99,940
|
|
Central Bank of Chile
|
|
|
660,083
|
|
|
|
1,100,831
|
|
|
|
660,083
|
|
|
|
1,100,831
|
|
Foreign banks
|
|
|
426,841
|
|
|
|
293,536
|
|
|
|
417,150
|
|
|
|
286,063
|
|
Subtotal
|
|
|
1,191,846
|
|
|
|
1,494,307
|
|
|
|
1,182,155
|
|
|
|
1,486,834
|
|
Loans to customers, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial loans
|
|
|
15,543,468
|
|
|
|
15,140,533
|
|
|
|
15,434,939
|
|
|
|
14,949,852
|
|
Residential mortgage loans
|
|
|
8,512,962
|
|
|
|
8,021,262
|
|
|
|
9,173,739
|
|
|
|
8,451,099
|
|
Consumer loans
|
|
|
4,149,170
|
|
|
|
4,145,428
|
|
|
|
4,145,267
|
|
|
|
4,116,261
|
|
Subtotal
|
|
|
28,205,600
|
|
|
|
27,307,223
|
|
|
|
28,753,945
|
|
|
|
27,517,212
|
|
Total
|
|
|
31,665,601
|
|
|
|
30,359,233
|
|
|
|
32,204,255
|
|
|
|
30,561,749
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current accounts and other demand deposits
|
|
|
9,600,788
|
|
|
|
9,584,488
|
|
|
|
9,600,788
|
|
|
|
9,584,488
|
|
Transactions in the course of payment
|
|
|
727,547
|
|
|
|
335,575
|
|
|
|
727,547
|
|
|
|
335,575
|
|
Repurchase agreements and securities lending
|
|
|
261,120
|
|
|
|
303,820
|
|
|
|
261,120
|
|
|
|
303,820
|
|
Savings accounts and time deposits
|
|
|
10,798,909
|
|
|
|
10,656,174
|
|
|
|
10,799,855
|
|
|
|
10,632,350
|
|
Borrowings from banks
|
|
|
1,596,655
|
|
|
|
1,516,759
|
|
|
|
1,585,587
|
|
|
|
1,506,940
|
|
Other financial obligations
|
|
|
171,284
|
|
|
|
118,014
|
|
|
|
172,934
|
|
|
|
119,024
|
|
Subtotal
|
|
|
23,156,303
|
|
|
|
22,514,830
|
|
|
|
23,147,831
|
|
|
|
22,482,197
|
|
Debt Issued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Letters of credit for residential purposes
|
|
|
12,678
|
|
|
|
15,040
|
|
|
|
13,483
|
|
|
|
15,982
|
|
Letters of credit for general purposes
|
|
|
990
|
|
|
|
1,328
|
|
|
|
1,053
|
|
|
|
1,411
|
|
Bonds
|
|
|
7,171,494
|
|
|
|
6,772,990
|
|
|
|
7,552,141
|
|
|
|
6,897,317
|
|
Subordinate bonds
|
|
|
678,645
|
|
|
|
686,194
|
|
|
|
763,597
|
|
|
|
732,611
|
|
Subtotal
|
|
|
7,863,807
|
|
|
|
7,475,552
|
|
|
|
8,330,274
|
|
|
|
7,647,321
|
|
Total
|
|
|
31,020,110
|
|
|
|
29,990,382
|
|
|
|
31,478,105
|
|
|
|
30,129,518
|
|
Other
financial assets and liabilities not measured at their fair value, but for which a fair value is estimated, even if not managed
based on such value, include assets and liabilities such as placements, deposits and other time deposits, debt issued, and other
financial assets and obligations with different maturities and characteristics. The fair value of these assets and liabilities
is calculated using the Discounted Cash Flow model and the use of various data sources such as yield curves, credit risk spreads,
etc. In addition, due to some of these assets and liabilities are not traded on the market, periodic reviews and analyzes are required
to determine the suitability of the inputs and determined fair values.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
39.
|
Fair Value of Financial assets and liabilities, continued:
|
|
(f)
|
Levels of other assets and liabilities:
|
The following table shows the
estimated fair value of financial assets and liabilities not valued at their fair value, as of June 30, 2019 and December 31, 2018:
|
|
Level 1
Estimated Fair Value
|
|
|
Level 2
Estimated Fair Value
|
|
|
Level 3
Estimated Fair Value
|
|
|
Total
Estimated Fair Value
|
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and due from banks
|
|
|
1,150,682
|
|
|
|
880,081
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,150,682
|
|
|
|
880,081
|
|
Transactions in the course of collection
|
|
|
1,023,491
|
|
|
|
580,333
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,023,491
|
|
|
|
580,333
|
|
Repurchase agreements and security lending
|
|
|
93,982
|
|
|
|
97,289
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
93,982
|
|
|
|
97,289
|
|
Subtotal
|
|
|
2,268,155
|
|
|
|
1,557,703
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2,268,155
|
|
|
|
1,557,703
|
|
Loans and advances to banks
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Domestic banks
|
|
|
104,922
|
|
|
|
99,940
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
104,922
|
|
|
|
99,940
|
|
Central Bank
|
|
|
660,083
|
|
|
|
1,100,831
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
660,083
|
|
|
|
1,100,831
|
|
Foreign banks
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
417,150
|
|
|
|
286,063
|
|
|
|
417,150
|
|
|
|
286,063
|
|
Subtotal
|
|
|
765,005
|
|
|
|
1,200,771
|
|
|
|
—
|
|
|
|
—
|
|
|
|
417,150
|
|
|
|
286,063
|
|
|
|
1,182,155
|
|
|
|
1,486,834
|
|
Loans to customers, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial loans
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
15,434,939
|
|
|
|
14,949,852
|
|
|
|
15,434,939
|
|
|
|
14,949,852
|
|
Residential mortgage loans
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,173,739
|
|
|
|
8,451,099
|
|
|
|
9,173,739
|
|
|
|
8,451,099
|
|
Consumer loans
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
4,145,267
|
|
|
|
4,116,261
|
|
|
|
4,145,267
|
|
|
|
4,116,261
|
|
Subtotal
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
28,753,945
|
|
|
|
27,517,212
|
|
|
|
28,753,945
|
|
|
|
27,517,212
|
|
Total
|
|
|
3,033,160
|
|
|
|
2,758,474
|
|
|
|
—
|
|
|
|
—
|
|
|
|
29,171,095
|
|
|
|
27,803,275
|
|
|
|
32,204,255
|
|
|
|
30,561,749
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current accounts and other demand deposits
|
|
|
9,600,788
|
|
|
|
9,584,488
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,600,788
|
|
|
|
9,584,488
|
|
Transactions in the course of payment
|
|
|
727,547
|
|
|
|
335,575
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
727,547
|
|
|
|
335,575
|
|
Repurchase agreements and security lending
|
|
|
261,120
|
|
|
|
303,820
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
261,120
|
|
|
|
303,820
|
|
Savings accounts and time deposits
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
10,799,855
|
|
|
|
10,632,350
|
|
|
|
10,799,855
|
|
|
|
10,632,350
|
|
Borrowings from banks
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,585,587
|
|
|
|
1,506,940
|
|
|
|
1,585,587
|
|
|
|
1,506,940
|
|
Other financial obligations
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
172,934
|
|
|
|
119,024
|
|
|
|
172,934
|
|
|
|
119,024
|
|
Subtotal
|
|
|
10,589,455
|
|
|
|
10,223,883
|
|
|
|
—
|
|
|
|
—
|
|
|
|
12,558,376
|
|
|
|
12,258,314
|
|
|
|
23,147,831
|
|
|
|
22,482,197
|
|
Debt Issued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Letters of credit for residential purposes
|
|
|
—
|
|
|
|
—
|
|
|
|
13,483
|
|
|
|
15,982
|
|
|
|
—
|
|
|
|
—
|
|
|
|
13,483
|
|
|
|
15,982
|
|
Letters of credit for general purposes
|
|
|
—
|
|
|
|
—
|
|
|
|
1,053
|
|
|
|
1,411
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,053
|
|
|
|
1,411
|
|
Bonds
|
|
|
—
|
|
|
|
—
|
|
|
|
7,552,141
|
|
|
|
6,897,317
|
|
|
|
—
|
|
|
|
—
|
|
|
|
7,552,141
|
|
|
|
6,897,317
|
|
Subordinated bonds
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
763,597
|
|
|
|
732,611
|
|
|
|
763,597
|
|
|
|
732,611
|
|
Subtotal
|
|
|
—
|
|
|
|
—
|
|
|
|
7,566,677
|
|
|
|
6,914,710
|
|
|
|
763,597
|
|
|
|
732,611
|
|
|
|
8,330,274
|
|
|
|
7,647,321
|
|
Total
|
|
|
10,589,455
|
|
|
|
10,223,883
|
|
|
|
7,566,677
|
|
|
|
6,914,710
|
|
|
|
13,321,973
|
|
|
|
12,990,925
|
|
|
|
31,478,105
|
|
|
|
30,129,518
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
39.
|
Fair Value of Financial Assets and Liabilities, continued:
|
|
(f)
|
Levels of other assets and liabilities, continued:
|
The Bank determines the fair
value of these assets and liabilities according to the following:
|
·
|
Short-term assets and liabilities: For assets and
liabilities with short-term maturity, it is assumed that the book values approximate to their fair value. This assumption is applied
to the following assets and liabilities:
|
|
Assets:
|
|
Liabilities:
|
|
|
|
|
|
Cash and deposits in banks
|
|
Current accounts and other demand deposits
|
|
Transactions in the course of collection
|
|
Transactions in the course of payments
|
|
Repurchase agreements and security lending
|
|
Repurchase agreements and security lending
|
|
Loans and advance to domestic banks
|
|
|
|
·
|
Loans to Customers and Advance to foreign banks: Fair
value is determined by using the discounted cash flow model and internally generated discount rates, based on internal transfer
rates derived from our internal transfer price policy. Once the present value is determined, we deduct the related loan loss allowances
in order to incorporate the credit risk associated with each contract or loan. As we use internally generated parameters for valuation
purposes, we categorize these instruments in Level 3.
|
|
·
|
Letters of Credit and Bonds: In order to determine
the present value of contractual cash flows, we apply the discounted cash flow model by using market interest rates that are available
in the market, either for the instruments under valuation or instruments with similar features that fit valuation needs in terms
of currency, maturities and liquidity. The market interest rates are obtained from third party price providers widely used by
the market. As a result of the valuation technique and the quality of inputs (observable) used for valuation, we categorize these
financial liabilities in Level 2.
|
|
·
|
Saving Accounts, Time Deposits, Borrowings from Financial
Institutions, Subordinated Bonds and Other borrowings financial: The discounted cash flow model is used to obtain the present
value of committed cash flows by applying a bucket approach and average adjusted discount rates that derived from both market
rates for instruments with similar features and our internal transfer price policy. As we use internally generated parameters
and/or apply significant judgmental analysis for valuation purposes, we categorize these financial liabilities in Level 3.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
39.
|
Fair Value of Financial Assets and Liabilities, continued:
|
|
(g)
|
Offsetting of financial assets and liabilities:
|
The Bank trades financial derivatives
with foreign counterparties using ISDA Master Agreement (International Swaps and Derivatives Association, Inc.), under legal jurisdiction
of the City of New York – USA or London – United Kingdom. Legal framework in these jurisdictions, along with documentation
mentioned, it allows Banco de Chile the right to anticipate the maturity of the transaction and then, offset the net value of those
transactions in case of default of counterparty. Additionally, the Bank has negotiated with these counterparties an additional
annex (CSA Credit Support Annex), that includes other credit mitigating, such as entering margins on a certain amount of net value
of transactions, early termination (optional or mandatory) of transactions at certain dates in the future, coupon adjustment of
transaction in exchange for payment of the debtor counterpart over a certain threshold amount, etc.
Below
are detail the contracts susceptible to offset:
|
|
Fair Value
|
|
|
Negative Fair Value of contracts with right to offset
|
|
|
Positive Fair Value of contracts with right to offset
|
|
|
Financial Collateral
|
|
|
Net Fair Value
|
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
June
|
|
|
December
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivative financial assets
|
|
|
1,435,764
|
|
|
|
1,513,947
|
|
|
|
(369,605
|
)
|
|
|
(582,210
|
)
|
|
|
(753,587
|
)
|
|
|
(424,920
|
)
|
|
|
(20,404
|
)
|
|
|
(30,036
|
)
|
|
|
292,168
|
|
|
|
476,781
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivative financial liabilities
|
|
|
1,572,621
|
|
|
|
1,528,357
|
|
|
|
(369,605
|
)
|
|
|
(582,210
|
)
|
|
|
(753,587
|
)
|
|
|
(424,920
|
)
|
|
|
(173,128
|
)
|
|
|
(233,450
|
)
|
|
|
276,301
|
|
|
|
287,777
|
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
40.
|
Maturity of Assets and Liabilities:
|
The
table below details the main financial assets and liabilities grouped in accordance with their remaining maturity, including accrued
interest as of June 30, 2019 and December 31, 2018, respectively. As these are for trading and available-for-sale instruments are
included at their fair value:
|
|
As of June 30, 2019
|
|
|
|
Up to 1 month
|
|
|
Over 1 month and up to 3 months
|
|
|
Over 3 month and up to 12 months
|
|
|
Subtotal up to 1 year
|
|
|
Over 1 year and up to 3 years
|
|
|
Over 3 year and up to 5 years
|
|
|
Over
5 years
|
|
|
Subtotal over 1 year
|
|
|
Total
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and due from banks
|
|
|
1,150,682
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,150,682
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,150,682
|
|
Transactions in the course of collection
|
|
|
1,023,491
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,023,491
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,023,491
|
|
Financial Assets held-for-trading
|
|
|
1,550,158
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,550,158
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,550,158
|
|
Repurchase agreements and security lending
|
|
|
66,612
|
|
|
|
14,466
|
|
|
|
12,904
|
|
|
|
93,982
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
93,982
|
|
Derivative instruments
|
|
|
105,324
|
|
|
|
69,031
|
|
|
|
265,454
|
|
|
|
439,809
|
|
|
|
288,613
|
|
|
|
268,114
|
|
|
|
439,228
|
|
|
|
995,955
|
|
|
|
1,435,764
|
|
Loans and advances to banks (*)
|
|
|
858,473
|
|
|
|
19,098
|
|
|
|
292,209
|
|
|
|
1,169,780
|
|
|
|
22,933
|
|
|
|
—
|
|
|
|
—
|
|
|
|
22,933
|
|
|
|
1,192,713
|
|
Loans to customers (*)
|
|
|
4,100,800
|
|
|
|
2,435,748
|
|
|
|
5,211,428
|
|
|
|
11,747,976
|
|
|
|
5,611,178
|
|
|
|
3,078,438
|
|
|
|
8,396,217
|
|
|
|
17,085,833
|
|
|
|
28,833,809
|
|
Financial assets available-for-sale
|
|
|
52,853
|
|
|
|
81,610
|
|
|
|
786,501
|
|
|
|
920,964
|
|
|
|
116,962
|
|
|
|
44,457
|
|
|
|
160,794
|
|
|
|
322,213
|
|
|
|
1,243,177
|
|
Financial assets held-to-maturity
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Total assets
|
|
|
8,908,393
|
|
|
|
2,619,953
|
|
|
|
6,568,496
|
|
|
|
18,096,842
|
|
|
|
6,039,686
|
|
|
|
3,391,009
|
|
|
|
8,996,239
|
|
|
|
18,426,934
|
|
|
|
36,523,776
|
|
|
|
As of December 31, 2018
|
|
|
|
Up to 1 month
|
|
|
Over 1 month and up to 3 months
|
|
|
Over 3 month and up to 12 months
|
|
|
Subtotal up to 1 year
|
|
|
Over 1 year and up to 3 years
|
|
|
Over 3 year and up to 5 years
|
|
|
Over
5 years
|
|
|
Subtotal over 1 year
|
|
|
Total
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and due from banks
|
|
|
880,081
|
|
|
|
—
|
|
|
|
—
|
|
|
|
880,081
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
880,081
|
|
Transactions in the course of collection
|
|
|
580,333
|
|
|
|
—
|
|
|
|
—
|
|
|
|
580,333
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
580,333
|
|
Financial Assets held-for-trading
|
|
|
1,745,366
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,745,366
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,745,366
|
|
Repurchase agreements and security lending
|
|
|
73,496
|
|
|
|
16,918
|
|
|
|
6,875
|
|
|
|
97,289
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
97,289
|
|
Derivative instruments
|
|
|
157,417
|
|
|
|
241,305
|
|
|
|
378,093
|
|
|
|
776,815
|
|
|
|
274,200
|
|
|
|
214,863
|
|
|
|
248,069
|
|
|
|
737,132
|
|
|
|
1,513,947
|
|
Loans and advances to banks (*)
|
|
|
1,262,428
|
|
|
|
77,268
|
|
|
|
132,259
|
|
|
|
1,471,955
|
|
|
|
23,441
|
|
|
|
—
|
|
|
|
—
|
|
|
|
23,441
|
|
|
|
1,495,396
|
|
Loans to customers (*)
|
|
|
3,941,756
|
|
|
|
2,143,023
|
|
|
|
4,973,622
|
|
|
|
11,058,401
|
|
|
|
5,726,668
|
|
|
|
3,133,606
|
|
|
|
7,995,647
|
|
|
|
16,855,921
|
|
|
|
27,914,322
|
|
Financial assets available-for-sale
|
|
|
38,691
|
|
|
|
137,420
|
|
|
|
383,200
|
|
|
|
559,311
|
|
|
|
74,940
|
|
|
|
136,342
|
|
|
|
272,847
|
|
|
|
484,129
|
|
|
|
1,043,440
|
|
Financial assets held-to-maturity
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Total assets
|
|
|
8,679,568
|
|
|
|
2,615,934
|
|
|
|
5,874,049
|
|
|
|
17,169,551
|
|
|
|
6,099,249
|
|
|
|
3,484,811
|
|
|
|
8,516,563
|
|
|
|
18,100,623
|
|
|
|
35,270,174
|
|
|
(*)
|
These balances are presented without deduction of their
respective provisions, which amount to Ch$628,209 million (Ch$607,099 million in December 2018) for loans to customers and Ch$867
million (Ch$1,089 million in December 2018) for borrowings from financial institutions.
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
40.
|
Maturity of Assets and Liabilities, continued:
|
|
|
As of June 30, 2019
|
|
|
|
Up to 1 month
|
|
|
Over 1 month and up to 3 months
|
|
|
Over 3 month and up to 12 months
|
|
|
Subtotal up to 1 year
|
|
|
Over 1 year and up to 3 years
|
|
|
Over 3 year and up to 5 years
|
|
|
Over
5 years
|
|
|
Subtotal over 1 year
|
|
|
Total
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current accounts and other demand deposits
|
|
|
9,600,788
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,600,788
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,600,788
|
|
Transactions in the course of payment
|
|
|
727,547
|
|
|
|
—
|
|
|
|
—
|
|
|
|
727,547
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
727,547
|
|
Repurchase agreements and security lending
|
|
|
259,281
|
|
|
|
693
|
|
|
|
1,146
|
|
|
|
261,120
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
261,120
|
|
Savings accounts and time deposits (**)
|
|
|
5,006,801
|
|
|
|
2,023,870
|
|
|
|
3,205,401
|
|
|
|
10,236,072
|
|
|
|
328,369
|
|
|
|
508
|
|
|
|
117
|
|
|
|
328,994
|
|
|
|
10,565,066
|
|
Derivative instruments
|
|
|
104,678
|
|
|
|
56,131
|
|
|
|
247,751
|
|
|
|
408,560
|
|
|
|
320,990
|
|
|
|
341,236
|
|
|
|
501,835
|
|
|
|
1,164,061
|
|
|
|
1,572,621
|
|
Borrowings from financial institutions
|
|
|
112,489
|
|
|
|
255,762
|
|
|
|
1,205,233
|
|
|
|
1,573,484
|
|
|
|
23,171
|
|
|
|
—
|
|
|
|
—
|
|
|
|
23,171
|
|
|
|
1,596,655
|
|
Debt issued:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage bonds
|
|
|
1,198
|
|
|
|
1,636
|
|
|
|
2,883
|
|
|
|
5,717
|
|
|
|
4,946
|
|
|
|
2,122
|
|
|
|
883
|
|
|
|
7,951
|
|
|
|
13,668
|
|
Bonds
|
|
|
362,776
|
|
|
|
312,266
|
|
|
|
577,082
|
|
|
|
1,252,124
|
|
|
|
1,228,075
|
|
|
|
1,537,446
|
|
|
|
3,153,849
|
|
|
|
5,919,370
|
|
|
|
7,171,494
|
|
Subordinate bonds
|
|
|
2,823
|
|
|
|
2,358
|
|
|
|
41,621
|
|
|
|
46,802
|
|
|
|
41,444
|
|
|
|
21,642
|
|
|
|
568,757
|
|
|
|
631,843
|
|
|
|
678,645
|
|
Other financial obligations
|
|
|
153,587
|
|
|
|
4,597
|
|
|
|
6,723
|
|
|
|
164,907
|
|
|
|
5,046
|
|
|
|
1,240
|
|
|
|
91
|
|
|
|
6,377
|
|
|
|
171,284
|
|
Lease liabilities
|
|
|
2,348
|
|
|
|
4,697
|
|
|
|
21,119
|
|
|
|
28,164
|
|
|
|
54,106
|
|
|
|
33,530
|
|
|
|
39,573
|
|
|
|
127,209
|
|
|
|
155,373
|
|
Total liabilities
|
|
|
16,334,316
|
|
|
|
2,662,010
|
|
|
|
5,308,959
|
|
|
|
24,305,285
|
|
|
|
2,006,147
|
|
|
|
1,937,724
|
|
|
|
4,265,105
|
|
|
|
8,208,976
|
|
|
|
32,514,261
|
|
|
|
As of December 31, 2018
|
|
|
|
Up to 1 month
|
|
|
Over 1 month and up to 3 months
|
|
|
Over 3 month and up to 12 months
|
|
|
Subtotal up to 1 year
|
|
|
Over 1 year and up to 3 years
|
|
|
Over 3 year and up to 5 years
|
|
|
Over
5 years
|
|
|
Subtotal over 1 year
|
|
|
Total
|
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
|
MCh$
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current accounts and other demand deposits
|
|
|
9,584,488
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,584,488
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,584,488
|
|
Transactions in the course of payment
|
|
|
335,575
|
|
|
|
—
|
|
|
|
—
|
|
|
|
335,575
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
335,575
|
|
Repurchase agreements and security lending
|
|
|
237,999
|
|
|
|
1,448
|
|
|
|
64,373
|
|
|
|
303,820
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
303,820
|
|
Savings accounts and time deposits (**)
|
|
|
5,018,791
|
|
|
|
1,946,688
|
|
|
|
3,100,464
|
|
|
|
10,065,943
|
|
|
|
365,177
|
|
|
|
619
|
|
|
|
132
|
|
|
|
365,928
|
|
|
|
10,431,871
|
|
Derivative instruments
|
|
|
146,887
|
|
|
|
237,039
|
|
|
|
335,497
|
|
|
|
719,423
|
|
|
|
264,438
|
|
|
|
273,790
|
|
|
|
270,706
|
|
|
|
808,934
|
|
|
|
1,528,357
|
|
Borrowings from financial institutions
|
|
|
115,220
|
|
|
|
269,412
|
|
|
|
1,052,830
|
|
|
|
1,437,462
|
|
|
|
79,297
|
|
|
|
—
|
|
|
|
—
|
|
|
|
79,297
|
|
|
|
1,516,759
|
|
Debt issued:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage bonds
|
|
|
1,453
|
|
|
|
1,618
|
|
|
|
3,581
|
|
|
|
6,652
|
|
|
|
5,911
|
|
|
|
2,577
|
|
|
|
1,228
|
|
|
|
9,716
|
|
|
|
16,368
|
|
Bonds
|
|
|
325,766
|
|
|
|
275,688
|
|
|
|
583,876
|
|
|
|
1,185,330
|
|
|
|
844,692
|
|
|
|
1,505,660
|
|
|
|
3,237,308
|
|
|
|
5,587,660
|
|
|
|
6,772,990
|
|
Subordinate bonds
|
|
|
4,220
|
|
|
|
2,254
|
|
|
|
44,901
|
|
|
|
51,375
|
|
|
|
41,122
|
|
|
|
27,906
|
|
|
|
565,791
|
|
|
|
634,819
|
|
|
|
686,194
|
|
Other financial obligations
|
|
|
97,393
|
|
|
|
3,505
|
|
|
|
10,126
|
|
|
|
111,024
|
|
|
|
5,555
|
|
|
|
1,307
|
|
|
|
128
|
|
|
|
6,990
|
|
|
|
118,014
|
|
Total liabilities
|
|
|
15,867,792
|
|
|
|
2,737,652
|
|
|
|
5,195,648
|
|
|
|
23,801,092
|
|
|
|
1,606,192
|
|
|
|
1,811,859
|
|
|
|
4,075,293
|
|
|
|
7,493,344
|
|
|
|
31,294,436
|
|
|
(**)
|
Excludes term saving accounts, which amount to Ch$233,84 3
million (Ch$224,303 million in December 2018).
|
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS, continued
(Free translation of interim consolidated financial statements originally issued in Spanish)
_____________
|
a)
|
On July 1, 2019, Banco de Chile reported the deceased
of the Director of Banco de Chile, Mr. Gonzalo Menéndez Duque.
|
|
b)
|
On July 8, 2019, the subsidiary Banchile Administradora
General de Fondos S.A. informed that on July 5, 2019 Mr. Nicolás Luksic Puga submitted his resignation to the position
of director of the Company.
|
In Management’s
opinion, there are no others significant subsequent events that affect or could affect the Interim Consolidated Financial Statements
of Banco de Chile and its subsidiaries between June 30, 2019 and the date of issuance of these Interim Consolidated Financial Statements.
|
|
|
|
|
|
Héctor Hernández G.
General Accounting Manager
|
|
Eduardo Ebensperger O.
Chief Executive Officer
|