Banco De Chile ADR

BCH: XNYS (USA)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	$98.00	Bhxpgsc	Vtsjvtp

Banco de Chile Earnings: Lower Inflation Is a Headwind to Results, but Credit Quality Is Stabilizing

Michael Miller

Oct 30, 2023

Narrow-moat-rated Banco de Chile reported decent third-quarter results, despite falling inflation acting as a headwind to the bank’s earnings. Net revenue decreased 12.4% from last year and 8.8% sequentially to CLP 681.9 billion. Meanwhile, net income fell 23.4% from last year to CLP 260 billion. Despite the decline, these earnings still translate to a return on average equity of 21%, an excellent result as Banco de Chile is coming off a cyclical high in profitability. As we incorporate these results, we do not expect to materially change our $21 fair value estimate for Banco de Chile. We see the shares as roughly fairly valued.

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