Banco Latinoamericano de Comercio Exterior SA Q4 FY2025 earnings call

• 2025 was the fourth consecutive year of record results. - Commercial portfolio grew 11.5% yoy, with loan book and contingent portfolio showing strong growth. - Deposits grew 22% yoy, making up over 60% of total funding. - Successfully completed first AT1 issuance in September 2025, strengthening capital structure. - Net interest income hit a record despite rate cuts, NIM 2.36% slightly above guidance. - Noninterest income grew 54% yoy, driven by strong performance of letters of credit and syndication teams. - Asset quality remained strong with Stage 1 exposures at 98.2% of total credit portfolio. - Funding strategy centered on deposits, with Yankee CD program reaching $1.5B by year-end.

Bladex's commercial portfolio grew 11.5% year-over-year in 2025, driven by a 10% year-over-year loan growth and over 20% growth in the contingent portfolio. Loan growth was led by Guatemala, Colombia, Mexico, the Dominican Republic, and Argentina. Deposits grew 22% year-over-year and represented more than 60% of total funding. Net interest income reached a record, increasing 5% year-over-year with a net interest margin of 2.36%. Noninterest income set a new record, growing 54% year-over-year and representing 20% of total revenues.

• 2026 guidance: commercial portfolio growth between 13% and 15%, average deposit growth at similar pace, net interest margin around 2.3%, efficiency ratio in the 28% area, ROE between 14% and 15%, Tier 1 capital in the 15% to 16% range.

• Geopolitical volatility. - Impact of rate cuts. - Election-related volatility in Latin American countries. - Potential sovereign rating downgrade in Colombia. - Increased bankruptcies and defaults in Brazil affecting refinancing risk.

Q: Clarify if ROE guidance is for accounting or adjusted figure, noninterest income outlook for 2026, and how duration impacted NIM in Q4.

A: ROE guidance is for adjusted figure. Noninterest income in 2026 is expected to be similar to 2025 levels with growth in fee-based products. Duration of medium-term transactions deployed in Q4 protected margins, and factors like average deposit balances and cost of funds also impacted Q4 NIM.

Q: How much of 13%-15% portfolio growth is driven by market growth vs market share gains, and NIM outlook for medium-term.

A: It's hard to separate market growth and market share gains as Bladex is a small player in a large market. NIM faces challenges due to market spread compression, but disciplined strategy and value-added transactions should help maintain margins over the medium-term.

Q: Which countries/regions will drive 13%-15% loan growth and which countries have high competitive pressures.

A: Growth is balanced across regions, with Guatemala, Argentina, etc., showing potential. Concerns include Colombia's fiscal situation and Brazil's increased bankruptcies/defaults, but opportunities exist in secondary loan market due to strong capital base.