XML 112 R11.htm IDEA: XBRL DOCUMENT

Segment Reporting

12 Months Ended

Dec. 31, 2019

Disclosure of operating segments [abstract]

5.	Segment Reporting:

For management purposes, the Bank has organized its operations and commercial strategies into four business segments, which are defined in accordance with the type of products and services offered to target customers. These business segments are currently defined as follows:

Retail:

This segment focuses on individuals and small and medium-sized companies 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 and money market operations:

This segment includes revenue associated with managing the Bank's balance sheet (currencies, maturities and interest rates) and liquidity, including financial instrument and currency trading on behalf of the Bank itself.

Transactions on behalf of 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.

Operations through 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:

	●	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.

	●	Socofin S.A.

The financial information used to measure the performance of the Bank's business segments is not necessarily comparable with similar information from other financial institutions because it is based on internal reporting policies. The accounting policies used to prepare the Bank's operating segment information are similar to those described in Note No. 2, "Summary of Significant Accounting Policies". The Bank obtains the majority of its income from: interest, UF indexation and fees and financial operations and changes, discounting provisions for credit risk and operating expenses. Management is mainly focused on these concepts in its evaluation of segment performance and decision-making regarding goals and allocation of resources for each unit individually. Although the results of the segments reconcile with those of the Bank at total level, this is not necessarily the case for all concepts on an individual basis, since the management is measured and controlled in individual form and additionally applies the following criteria:

●

The net interest margin of loans and deposits is measured on an individual transaction and individual client basis. For that purposes, it is considered the volume of each operation and its contribution margin, that at the same time corresponds to the difference between effective rate of the client and the internal transfer price established according to terms and currency of each operation. Additionally, the net margin includes the result of interest and UF indexation from the accounting hedges.

●

The internal performance profitability system considers capital allocation in each segment in accordance to the Basel guidelines.

●

Operating expenses are distributed at each area level. The Bank allocates all of its indirect operating costs to each business segment by utilizing a different cost driver in order to allocate such costs to the specific segment.

The Bank did not enter into transactions with any particular customer or third party that collectively generated more than 10% of the Bank's total income in 2018 and 2019.

Taxes are managed at the consolidated level and are not allocated to business segments.

	As of December 31, 2017
	Retail			Wholesale			Treasury			Subsidiaries			Subtotal			Reclassifications and adjustments to conform IFRS				Total
	MCh$			MCh$			MCh$			MCh$			MCh$			MCh$			Note	MCh$
Net interest income		930,539			322,431			(21,169	)		(4,336	)		1,227,465			7,230				1,234,695
Net fees and commissions income		184,049			43,443			(4,306	)		135,987			359,173			(11,499	)			347,674
Other operating income		19,095			34,712			56,328			26,884			137,019			(31,846	)			105,173
Total operating revenue		1,133,683			400,586			30,853			158,535			1,723,657			(36,115	)	(1)		1,687,542
Provisions for loan losses		(256,262	)		21,415			―			(135	)		(234,982	)		13,727		(2)		(221,255	)
Depreciation and amortization		(27,669	)		(4,547	)		(141	)		(2,894	)		(35,251	)		(2,285	)	(3)		(37,536	)
Other operating expenses		(507,771	)		(153,360	)		(5,022	)		(102,281	)		(768,434	)		21,614		(4)		(746,820	)
Income attributable to associates		4,372			1,026			108			551			6,057			(546	)			5,511
Income before income taxes		346,353			265,120			25,798			53,776			691,047			(3,605	)			687,442
Income taxes														(115,034	)		(327	)	(5)		(115,361	)
Income after income taxes														576,013			(3,932	)			572,081

Assets		16,099,926			10,558,278			5,469,829			637,860			32,765,893			(388,753	)			32,377,140
Current and deferred taxes														290,432			(106,135	)			184,297
Total assets														33,056,325			(494,888	)	(6)		32,561,437

Liabilities		10,380,250			10,272,607			8,815,056			479,244			29,947,157			(934,521	)			29,012,636
Current and deferred taxes														3,453			―				3,453
Total liabilities														29,950,610			(934,521	)	(7)		29,016,089

Reclassifications and adjustments to conform IFRS

(1)

The total effect due to the elimination adjustments to conform the total operating revenue is MCh$(14,387). In addition the total effect of IFRS adjustments is MCh$(21,728) which mainly stems from the reclassification of interest on repurchase agreements and suspended interest recognition.

(2)

The total effect relates to IFRS adjustments of MCh$13,727, which mainly stems from differences in the calculation of allowances for loan losses.

(3)

The total effect relates to IFRS adjustments of MCh$(2,285), which stems from the amortization of intangibles and depreciation of property and equipment acquired through business combinations.

(4)

The total effect due to the elimination adjustments to conform other operating expenses is MCh$14,387. In addition the total effect of IFRS adjustments is MCh$7,227, which represents reversal of write-offs of assets received in lieu of payments.

(5)

The total effect relates to IFRS adjustments of MCh$(327), which stems from deferred taxes.

(6)

The total effect due to the elimination adjustments to conform the consolidated financial position data in assets is MCh$(232,137). In addition the total effect of IFRS adjustments in assets is MCh$(262,751), which mainly stems from differences in the calculation of allowances for loan losses, the acquisition of Citibank Chile and deferred taxes effects and settlement of transactions in the course of collection.

(7)

The total effect due to the elimination adjustments to conform the consolidated financial position data in liabilities is MCh$(232,137). In addition the total effect of IFRS adjustments in liabilities is MCh$(702,384), which mainly stems from provision for minimum dividends and differences in the calculation of allowances for loan losses.

	As of December 31, 2018
	Retail			Wholesale			Treasury			Subsidiaries			Subtotal			Reclassifications and adjustments to conform IFRS				Total
	MCh$			MCh$			MCh$			MCh$			MCh$			MCh$			Note	MCh$
Net interest income		972,172			355,451			(2,415	)		(8,994	)		1,316,214			4,763				1,320,977
Net fees and commissions income		184,545			45,905			(4,031	)		145,704			372,123			(12,168	)			359,955
Other operating income		43,288			59,376			63,931			33,341			199,936			(34,798	)			165,138
Total operating revenue		1,200,005			460,732			57,485			170,051			1,888,273			(42,203	)	(1)		1,846,070
Provisions for loan losses		(287,569	)		6,041			―			118			(281,410	)		31,639		(2)		(249,771	)
Depreciation and amortization		(29,571	)		(5,008	)		(91	)		(3,011	)		(37,681	)		―				(37,681	)
Other operating expenses		(561,513	)		(152,921	)		(4,693	)		(105,906	)		(825,033	)		23,006		(3)		(802,027	)
Income attributable to associates		4,220			2,173			400			462			7,255			(444	)			6,811
Income before income taxes		325,572			311,017			53,101			61,714			751,404			11,998				763,402
Income taxes														(156,531	)		(3,237	)	(4)		(159,768	)
Income after income taxes														594,873			8,761				603,634

Assets		16,425,483			10,591,702			8,093,850			925,440			36,036,475			(612,545	)			35,423,930
Current and deferred taxes														262,582			(85,082	)			177,500
Total assets														36,299,057			(697,627	)	(5)		35,601,430

Liabilities		10,399,587			9,873,018			11,952,656			764,736			32,989,997			(1,067,190	)			31,922,807
Current and deferred taxes														4,907			―				4,907
Total liabilities														32,994,904			(1,067,190	)	(6)		31,927,714

Reclassifications and adjustments to conform IFRS

(1)

The total effect due to the elimination adjustments to conform the total operating revenue is MCh$(14,990). In addition the total effect of IFRS adjustments is MCh$(27,213) which mainly stems from the reclassification of interest on repurchase agreements and suspended interest recognition.

(2)

The total effect relates to IFRS adjustments of MCh$31,639, which mainly stems from differences in the calculation of allowances for loan losses.

(3)

The total effect due to the elimination adjustments to conform other operating expenses is MCh$14,990. In addition the total effect of IFRS adjustments is MCh$8,016, which mainly represents reversal of write-offs of assets received in lieu of payments.

(4)

The total effect relates to IFRS adjustments of MCh$(3,237), which stems from deferred taxes.

(5)

The total effect due to the elimination adjustments to conform the consolidated financial position data in assets is MCh$(388,615). In addition the total effect of IFRS adjustments in assets is MCh$(309,012), which mainly stems from differences in the calculation of allowances for loan losses, the acquisition of Citibank Chile and deferred taxes effects and settlement of transactions in the course of collection.

(6)

The total effect due to the elimination adjustments to conform the consolidated financial position data in liabilities is MCh$(388,615). In addition the total effect of IFRS adjustments in liabilities is MCh$(678,575), which mainly stems from provision for minimum dividends and differences in the calculation of allowances for loan losses.

	As of December 31, 2019
	Retail			Wholesale			Treasury			Subsidiaries			Subtotal			Reclassifications and adjustments to conform IFRS				Total
	MCh$			MCh$			MCh$			MCh$			MCh$			MCh$			Note	MCh$
Net interest income		1,033,646			359,074			(19,246	)		(7,651	)		1,365,823			5,455				1,371,278
Net fees and commissions income		270,064			48,097			(3,241	)		153,330			468,250			(10,948	)			457,302
Other operating income		34,854			61,505			45,105			53,931			195,395			(18,757	)			176,638
Total operating revenue		1,338,564			468,676			22,618			199,610			2,029,468			(24,250	)	(1)		2,005,218
Provisions for loan losses		(333,156	)		(14,052	)		―			(66	)		(347,274	)		15,673		(2)		(331,601	)
Depreciation and amortization		(58,725	)		(5,885	)		(85	)		(5,846	)		(70,541	)		―				(70,541	)
Other operating expenses		(587,212	)		(151,660	)		(5,040	)		(111,499	)		(855,411	)		23,702		(3)		(831,709	)
Income attributable to associates		3,957			1,669			331			493			6,450			(411	)			6,039
Income before income taxes		363,428			298,748			17,824			82,692			762,692			14,714				777,406
Income taxes														(169,683	)		(3,978	)	(4)		(173,661	)
Income after income taxes														593,009			10,736				603,745

Assets		18,139,505			10,766,374			11,426,849			964,695			41,297,423			(515,199	)			40,782,224
Current and deferred taxes														321,305			(89,655	)			231,650
Total assets														41,618,728			(604,854	)	(5)		41,013,874

Liabilities		11,407,066			10,750,446			15,075,652			781,052			38,014,216			(982,392	)			37,031,824
Current and deferred taxes														76,289			―				76,289
Total liabilities														38,090,505			(982,392	)	(6)		37,108,113

Reclassifications and adjustments to conform IFRS

(1)

The total effect due to the elimination adjustments to conform the total operating revenue is MCh$(14,948). In addition the total effect of IFRS adjustments is MCh$(9,302) which mainly stems from the reclassification of interest on repurchase agreements and suspended interest recognition.

(2)

The total effect relates to IFRS adjustments of MCh$15,673, which mainly stems from differences in the calculation of allowances for loan losses.

(3)

The total effect due to the elimination adjustments to conform other operating expenses is MCh$14,948. In addition the total effect of IFRS adjustments is MCh$8,754, which mainly represents reversal of write-offs of assets received in lieu of payments.

(4)

The total effect relates to IFRS adjustments of MCh$(3,978), which stems from deferred taxes.

(5)

The total effect due to the elimination adjustments to conform the consolidated financial position data in assets is MCh$(345,395). In addition the total effect of IFRS adjustments in assets is MCh$(259,459), which mainly stems from differences in the calculation of allowances for loan losses, the acquisition of Citibank Chile and deferred taxes effects and settlement of transactions in the course of collection.

(6)

The total effect due to the elimination adjustments to conform the consolidated financial position data in liabilities is MCh$(345,395). In addition the total effect of IFRS adjustments in liabilities is MCh$(636,997), which mainly stems from provision for minimum dividends and differences in the calculation of allowances for loan losses.