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Segment Reporting | 12 Months Ended
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Dec. 31, 2021
Disclosure of entity |
Segment Reporting |
| 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 (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:
| ● | 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. en Liquidación
| ● | 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 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 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.
| ● | Provisions for credit risk are determined at the customer level based on the characteristics of each of their operations.
| ● | The capital and 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.
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 2020 and 2021. Taxes are managed at the consolidated level and are not allocated to business segments.
|  | 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 |  |  | 1,020,346 |  |  |  | 366,638 |  |  |  | (13,511 | ) |  |  | (7,650 | ) |  |  | 1,365,823 |  |  |  | 5,455 |  |  |  |  |  | 1,371,278 |
Net fees and commissions income |  |  | 268,345 |  |  |  | 49,492 |  |  |  | (2,917 | ) |  |  | 153,330 |  |  |  | 468,250 |  |  |  | (10,948 | ) |  |  |  |  | 457,302 |
Other operating income |  |  | 37,225 |  |  |  | 62,153 |  |  |  | 42,087 |  |  |  | 53,931 |  |  |  | 195,396 |  |  |  | (18,758 | ) |  |  |  |  | 176,638 |
Total operating revenue |  |  | 1,325,916 |  |  |  | 478,283 |  |  |  | 25,659 |  |  |  | 199,611 |  |  |  | 2,029,469 |  |  |  | (24,251 | ) |  | (1) |  |  | 2,005,218 |
Provisions for Expected Credit losses |  |  | (332,833 | ) |  |  | (14,375 | ) |  |  | — |  |  |  | (66 | ) |  |  | (347,274 | ) |  |  | 15,673 |  |  | (2) |  |  | (331,601 | )
Depreciation and amortization |  |  | (57,826 | ) |  |  | (6,605 | ) |  |  | (264 | ) |  |  | (5,846 | ) |  |  | (70,541 | ) |  |  | — |  |  |  |  |  | (70,541 | )
Other operating expenses |  |  | (588,997 | ) |  |  | (151,949 | ) |  |  | (2,967 | ) |  |  | (111,499 | ) |  |  | (855,412 | ) |  |  | 23,703 |  |  | (3) |  |  | (831,709 | )
Income attributable to associates |  |  | 4,826 |  |  |  | 1,020 |  |  |  | 111 |  |  |  | 493 |  |  |  | 6,450 |  |  |  | (411 | ) |  |  |  |  | 6,039 |
Income before income taxes |  |  | 351,086 |  |  |  | 306,374 |  |  |  | 22,539 |  |  |  | 82,693 |  |  |  | 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 |  |  | 18,215,859 |  |  |  | 10,765,728 |  |  |  | 11,351,141 |  |  |  | 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 |  |  | 10,735,252 |  |  |  | 9,160,441 |  |  |  | 17,337,471 |  |  |  | 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$(14,949). In addition the total effect of IFRS adjustments is MCh$(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 ECL.
| (3) | The total effect due to the elimination adjustments to conform other operating expenses is MCh$14,949. 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 ECL.
|  | As of December 31, 2020 |
|  | Retail |  |  | Wholesale |  |  | Treasury |  |  | Subsidiaries |  |  | Subtotal |  |  | Reclassifications and adjustments to conform IFRS |  |  |  |  | Total |
|  | MCh$ |  |  | MCh$ |  |  | MCh$ |  |  | MCh$ |  |  | MCh$ |  |  | MCh$ |  |  | Note |  | MCh$ |
Net interest income |  |  | 940,075 |  |  |  | 377,314 |  |  |  | (3,603 | ) |  |  | (1,923 | ) |  |  | 1,311,863 |  |  |  | 4,925 |  |  |  |  |  | 1,316,788 |
Net fees and commissions income |  |  | 265,338 |  |  |  | 55,599 |  |  |  | (1,969 | ) |  |  | 143,863 |  |  |  | 462,831 |  |  |  | (16,863 | ) |  |  |  |  | 445,968 |
Other operating income |  |  | 26,231 |  |  |  | 48,163 |  |  |  | 75,144 |  |  |  | 35,991 |  |  |  | 185,529 |  |  |  | (13,475 | ) |  |  |  |  | 172,054 |
Total operating revenue |  |  | 1,231,644 |  |  |  | 481,076 |  |  |  | 69,572 |  |  |  | 177,931 |  |  |  | 1,960,223 |  |  |  | (25,413 | ) |  | (1) |  |  | 1,934,810 |
Provisions for Expected Credit losses |  |  | (325,852 | ) |  |  | (136,448 | ) |  |  | — |  |  |  | (380 | ) |  |  | (462,680 | ) |  |  | (84,426 | ) |  | (2) |  |  | (547,106 | )
Depreciation and amortization |  |  | (59,730 | ) |  |  | (7,317 | ) |  |  | (312 | ) |  |  | (5,998 | ) |  |  | (73,357 | ) |  |  | — |  |  |  |  |  | (73,357 | )
Other operating expenses |  |  | (566,688 | ) |  |  | (153,717 | ) |  |  | (3,458 | ) |  |  | (106,591 | ) |  |  | (830,454 | ) |  |  | 26,059 |  |  | (3) |  |  | (804,395 | )
Income attributable to associates |  |  | (6,674 | ) |  |  | 1,548 |  |  |  | (7 | ) |  |  | 472 |  |  |  | (4,661 | ) |  |  | (438 | ) |  |  |  |  | (5,099 | )
Income before income taxes |  |  | 272,700 |  |  |  | 185,142 |  |  |  | 65,795 |  |  |  | 65,434 |  |  |  | 589,071 |  |  |  | (84,218 | ) |  |  |  |  | 504,853 |
Income taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (125,962 | ) |  |  | 22,739 |  |  | (4) |  |  | (103,223 | )
Income after income taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 463,109 |  |  |  | (61,479 | ) |  |  |  |  | 401,630 |
Assets |  |  | 18,800,918 |  |  |  | 10,811,000 |  |  |  | 15,400,139 |  |  |  | 830,910 |  |  |  | 45,842,967 |  |  |  | (607,473 | ) |  |  |  |  | 45,235,494 |
Current and deferred taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 380,894 |  |  |  | (65,428 | ) |  |  |  |  | 315,466 |
Total assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 46,223,861 |  |  |  | (672,901 | ) |  | (5) |  |  | 45,550,960 |
Liabilities |  |  | 13,848,124 |  |  |  | 10,143,939 |  |  |  | 17,844,350 |  |  |  | 660,869 |  |  |  | 42,497,282 |  |  |  | (943,714 | ) |  |  |  |  | 41,553,568 |
Current and deferred taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 311 |  |  |  | — |  |  |  |  |  | 311 |
Total liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 42,497,593 |  |  |  | (943,714 | ) |  | (6) |  |  | 41,553,879 |
Reclassifications and adjustments to conform IFRS
| (1) | The total effect due to the elimination adjustments to conform the total operating revenue is MCh$(21,480). In addition the total effect of IFRS adjustments is MCh$(3,933) 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$(84,426), which mainly stems from differences in the calculation of allowances for ECL.
| (3) | The total effect due to the elimination adjustments to conform other operating expenses is MCh$21,480. In addition the total effect of IFRS adjustments is MCh$4,579, which mainly represents reversal of write-offs of assets received in lieu of payments.
| (4) | The total effect relates to IFRS adjustments of MCh$22,739, which stems from deferred taxes.
| (5) | The total effect due to the elimination adjustments to conform the consolidated financial position data in assets is MCh$(128,730). In addition the total effect of IFRS adjustments in assets is MCh$(544,171), which mainly stems from differences in the calculation of allowances for loan losses, the acquisition of Citibank Chile and deferred taxes effects and settlement of transactions in the course of collection.
| (6) | The total effect due to the elimination adjustments to conform the consolidated financial position data in liabilities is MCh$(128,730). In addition the total effect of IFRS adjustments in liabilities is MCh$(814,984), which mainly stems from provision for minimum dividends and differences in the calculation of allowances for ECL.
|  | As of December 31, 2021 |
|  | Retail |  |  | Wholesale |  |  | Treasury |  |  | Subsidiaries |  |  | Subtotal |  |  | Reclassifications and adjustments to conform IFRS |  |  |  |  | Total |
|  | MCh$ |  |  | MCh$ |  |  | MCh$ |  |  | MCh$ |  |  | MCh$ |  |  | MCh$ |  |  | Note |  | MCh$ |
Net interest income |  |  | 1,084,191 |  |  |  | 478,807 |  |  |  | 6,479 |  |  |  | (1,198 | ) |  |  | 1,568,279 |  |  |  | 5,743 |  |  |  |  |  | 1,574,022 |
Net fees and commissions income |  |  | 250,470 |  |  |  | 61,671 |  |  |  | (1,864 | ) |  |  | 160,507 |  |  |  | 470,784 |  |  |  | (15,756 | ) |  |  |  |  | 455,028 |
Other operating income |  |  | 42,160 |  |  |  | 80,994 |  |  |  | 52,058 |  |  |  | 36,839 |  |  |  | 212,051 |  |  |  | (7,016 | ) |  |  |  |  | 205,035 |
Total operating revenue |  |  | 1,376,821 |  |  |  | 621,472 |  |  |  | 56,673 |  |  |  | 196,148 |  |  |  | 2,251,114 |  |  |  | (17,029 | ) |  | (1) |  |  | 2,234,085 |
Provisions for Expected Credit losses |  |  | (259,229 | ) |  |  | (114,299 | ) |  |  | — |  |  |  | 268 |  |  |  | (373,260 | ) |  |  | 354,088 |  |  | (2) |  |  | (19,172 | )
Depreciation and amortization |  |  | (62,721 | ) |  |  | (8,114 | ) |  |  | (365 | ) |  |  | (5,598 | ) |  |  | (76,798 | ) |  |  | — |  |  |  |  |  | (76,798 | )
Other operating expenses |  |  | (562,599 | ) |  |  | (155,701 | ) |  |  | (3,538 | ) |  |  | (109,985 | ) |  |  | (831,823 | ) |  |  | 24,201 |  |  | (3) |  |  | (807,622 | )
Income attributable to associates |  |  | (229 | ) |  |  | 1,886 |  |  |  | 84 |  |  |  | 499 |  |  |  | 2,240 |  |  |  | (447 | ) |  |  |  |  | 1,793 |
Income before income taxes |  |  | 492,043 |  |  |  | 345,244 |  |  |  | 52,854 |  |  |  | 81,332 |  |  |  | 971,473 |  |  |  | 360,813 |  |  |  |  |  | 1,332,286 |
Income taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | (178,550 | ) |  |  | (97,419 | ) |  | (4) |  |  | (275,969 | )
Income after income taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 792,923 |  |  |  | 263,394 |  |  |  |  |  | 1,056,317 |
Assets |  |  | 20,458,338 |  |  |  | 12,806,598 |  |  |  | 17,412,053 |  |  |  | 954,858 |  |  |  | 51,631,847 |  |  |  | (482,299 | ) |  |  |  |  | 51,149,548 |
Current and deferred taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 440,040 |  |  |  | (163,640 | ) |  |  |  |  | 276,400 |
Total assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 52,071,887 |  |  |  | (645,939 | ) |  | (5) |  |  | 51,425,948 |
Liabilities |  |  | 16,794,546 |  |  |  | 10,530,749 |  |  |  | 19,640,221 |  |  |  | 770,228 |  |  |  | 47,735,744 |  |  |  | (1,241,051 | ) |  |  |  |  | 46,494,693 |
Current and deferred taxes |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 113,129 |  |  |  | (846 | ) |  |  |  |  | 112,283 |
Total liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | 47,848,873 |  |  |  | (1,241,897 | ) |  | (6) |  |  | 46,606,976 |
Reclassifications and adjustments to conform IFRS
| (1) | The total effect due to the elimination adjustments to conform the total operating revenue is MCh$(20,857). In addition the total effect of IFRS adjustments is MCh$3,828, 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$354,088, which mainly stems from differences in the calculation of allowances for ECL.
| (3) | The total effect due to the elimination adjustments to conform other operating expenses is MCh$20,857. In addition the total effect of IFRS adjustments is MCh$3,344, which mainly represents reversal of write-offs of assets received in lieu of payments.
| (4) | The total effect relates to IFRS adjustments of MCh$(97,419), 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$(369,448). In addition the total effect of IFRS adjustments in assets is MCh$(276,491), 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$(369,448). In addition the total effect of IFRS adjustments in liabilities is MCh$(872,449), which mainly stems from provision for minimum dividends and differences in the calculation of allowances for ECL.

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