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Banco Santander México Reports First Quarter 2019 Net Income of Ps.5,291 Million

- Executing the third and final year of operational and digital transformation

- Loyalty and digitalization initiatives continue to enhance quality of retail customer base

- Robust loan growth, particularly in middle-market, government and mortgages, while improving the asset quality

- Net income growth mainly driven by strong net interest income and lower provisions, offset by higher effective tax rate

MEXICO CITY, April 30, 2019 /PRNewswire/ -- Banco Santander México, S.A., Institución de Banca Múltiple, Grupo Financiero Santander México (NYSE: BSMX; BMV: BSMX), ("Banco Santander México" or "the Bank"), today announced financial results for the three-month period ending March 31st, 2019.

Banco Santander México reported net income of Ps.5,291 million in 1Q19, representing increases of 11.9% YoY and 15.3% QoQ.

HIGHLIGHTS








Results (Million pesos)


1Q19

4Q18

1Q18


% QoQ

% YoY

Net interest income


16,449

16,203

14,615


1.5

12.5

Fee and commission, net


4,426

4,230

4,069


4.6

8.8

Core revenues


20,875

20,433

18,684


2.2

11.7

Provisions for loan losses


4,318

4,838

4,137


(10.7)

4.4

Administrative and promotional expenses


9,256

9,228

8,218


0.3

12.6

Net income


5,291

4,590

4,727


15.3

11.9

Net income per share1


0.78

0.68

0.70


14.7

11.4









Balance Sheet Data (Million pesos)


Mar-19

Dec-18

Mar-18


% QoQ

% YoY

Total assets


1,304,294

1,381,570

1,288,249


(5.6)

1.2

Total loans


691,226

682,848

630,999


1.2

9.5

Deposits


702,644

693,812

665,100


1.3

5.6

Shareholders´ equity


132,366

125,693

122,132


5.3

8.4









Key Ratios (%)


1Q19

4Q18

1Q18


bps QoQ

bps YoY

Net interest margin


5.58

5.44

5.52


14

6

Net loans to deposits ratio


95.41

95.38

91.88


3

353

ROAE


16.40

15.18

15.87


122

53

ROAA


1.58

1.36

1.45


22

13

Efficiency ratio


44.81

46.63

44.77


(182)

4

Capital ratio


16.90

15.91

15.71


99

119

NPLs ratio


2.15

2.36

2.43


(21)

(28)

Cost of Risk


2.69

2.72

3.05


(3)

(36)

Coverage ratio


140.06

131.16

129.48


890

1,058









Operating Data


Mar-19

Dec-18

Mar-18


% QoQ

% YoY

Branches


1,214

1,219

1,219


(0.4)

(0.4)

Branches and offices2


1,390

1,393

1,375


(0.2)

1.1

ATMs


8,507

8,384

7,506


1.5

13.3

Customers


17,034,317

16,690,402

15,857,837


2.1

7.4

Employees


19,291

18,979

17,829


1.6

8.2









1) Accumulated EPS, net of treasury shares (compensation plan) and discontinued operations. Calculated by using weighted number of shares.

2) Includes cash desks (espacios select, box select and corner select) and SMEs business centers. Excluding brokerage house offices.

 

Héctor Grisi, Banco Santander México's Executive President and CEO, commented: "As we entered the third and final year of transforming our bank operationally and digitally, successful execution of our strategy continued improving performance across all business areas. Our discipline allowed us to deliver a 12% year-on-year increase in net income, with ROAE rising 53 basis points to 16.4%. We achieved this while continuing to invest in our strategic initiatives and improving asset quality throughout our loan portfolio.

Also reflecting the strength of our strategy to become a more client-centric bank, we made further progress driving sustained high-quality loan expansion that was in line with the market, while generating our ninth consecutive quarter of double-digit growth in retail deposits. More importantly, our base of loyal clients, who are four times more profitable than others, continues to expand at a strong, double-digit rate. The number of digital and mobile customers accelerated at an even faster pace, as our digital transformation advances

Attracted by the growing strength of our franchise and the potential of Mexico's financial sector, our parent company recently announced its intention to launch a voluntary exchange offer to acquire minority shareholders' interests in Banco Santander México. As part of this offer, there are no plans to de-list Banco Santander México's shares neither from the Mexican Stock Exchange nor from the NYSE."

1Q19 EARNINGS CALL DIAL-IN INFORMATION

Date:                  

Tuesday, April, 30th, 2019

Time:                   

10:00 a.m. (MCT); 11:00 a.m. (US ET)

Dial-in Numbers:   

1-877-407-4018 US & Canada 1-201-689-8471 International & Mexico

Access Code:     

Please ask for Santander México Earnings Call

Webcast:            

http://public.viavid.com/index.php?id=134043

Replay:               

Starting: Tuesday, April 30th, 2019 at 2:00 p.m. (US ET)


Ending: Tuesday, May 7th, 2019 at 11:59 p.m. (US ET)


ET Dial-in number: 1-844-512-2921 US & Canada; 1-412-317-6671 International & Mexico Access Code: 13689739

 

ABOUT BANCO SANTANDER MÉXICO (NYSE: BSMX; BMV: BSMX)
Banco Santander México, S.A., Institución de Banca Múltiple, Grupo Financiero Santander México (Banco Santander México), one of Mexico's leading banking institutions, provides a wide range of financial and related services, including retail and commercial banking, financial advisory and other related investment activities. Banco Santander México offers a multichannel financial services platform focused on mid- to high-income individuals and small- to medium-sized enterprises, while also providing integrated financial services to larger multinational companies in Mexico. As of March 31, 2019, Banco Santander México had total assets of Ps.1,304 billion under Mexican Banking GAAP and more than 17.0 million customers. Headquartered in Mexico City, the Company operates 1,390 branches and offices nationwide and has a total of 19,291 employees.

LEGAL DISCLAIMER
Banco Santander México cautions that this presentation may contain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements could be found in various places throughout this presentation and include, without limitation, statements regarding our intent, belief, targets or current expectations in connection with: asset growth and sources of funding; growth of our fee-based business; expansion of our distribution network; financing plans; competition; impact of regulation and the interpretation thereof; action to modify or revoke our banking license; exposure to market risks including interest rate risk, foreign exchange risk and equity price risk; exposure to credit risks including credit default risk and settlement risk; projected capital expenditures; capitalization requirements and level of reserves; investment in our information technology platform; liquidity; trends affecting the economy generally; and trends affecting our financial condition and our results of operations. While these forward-looking statements represent our judgment and future expectations concerning the development of our business, many important factors could cause actual results to differ substantially from those anticipated in forward-looking statements. These factors include, among other things: changes in capital markets in general that may affect policies or attitudes towards lending to Mexico or Mexican companies; changes in economic conditions, in Mexico in particular, in the United States or globally; the monetary, foreign exchange and interest rate policies of the Mexican Central Bank (Banco de México); inflation; deflation; unemployment; unanticipated turbulence in interest rates; movements in foreign exchange rates; movements in equity prices or other rates or prices; changes in Mexican and foreign policies, legislation and regulations; changes in requirements to make contributions to, for the receipt of support from programs organized by or requiring deposits to be made or assessments observed or imposed by, the Mexican government; changes in taxes and tax laws; competition, changes in competition and pricing environments; our inability to hedge certain risks economically; economic conditions that affect consumer spending and the ability of customers to comply with obligations; the adequacy of allowance for impairment losses and other losses; increased default by borrowers; our inability to successfully and effectively integrate acquisitions or to evaluate risks arising from asset acquisitions; technological changes; changes in consumer spending and saving habits; increased costs; unanticipated increases in financing and other costs or the inability to obtain additional debt or equity financing on attractive terms; changes in, or failure to comply with, banking regulations or their interpretation; and certain other risk factors included in our annual report on Form 20-F. The risk factors and other key factors that we have indicated in our past and future filings and reports, including those with the U.S. Securities and Exchange Commission, could adversely affect our business and financial performance. The words "believe," "may," "will," "aim," "estimate," "continue," "anticipate," "intend," "expect," "forecast" and similar words are intended to identify forward-looking statements. You should not place undue reliance on such statements, which speak only as of the date they were made. We undertake no obligation to update publicly or to revise any forward-looking statements after we distribute this presentation because of new information, future events or other factors. In light of the risks and uncertainties described above, the future events and circumstances discussed herein might not occur and are not guarantees of future performance.

Note: The information contained in this presentation is not audited. Nevertheless, the consolidated accounts are prepared on the basis of the accounting principles and regulations prescribed by the Mexican National Banking and Securities Commission (Comisión Nacional Bancaria y de Valores) for credit institutions, as amended (Mexican Banking GAAP). All figures presented are in millions of Mexican pesos, unless otherwise indicated. Historical figures are not adjusted by inflation.

Cision

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