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Fair Value of Financial Assets and Liabilities (Tables)

12 Months Ended

Dec. 31, 2023

Fair Value of Financial Assets and Liabilities [Abstract]

Schedule of Valuation Techniques and Inputs

Type of Financial Instrument		Valuation Method		Description: Inputs and Sources
Local Bank and Corporate Bonds		Discounted cash flows model		Prices (internal rates of return) are provided by third party price providers that are widely used in the Chilean market. Model is based on a Base Yield (Central Bank Bonds) and issuer spread. The model is based on daily prices and risk/maturity similarities between Instruments.

Offshore Bank and Corporate Bonds				Prices (internal rates of return) are provided by third party price providers that are widely used in the Chilean market. Model is based on daily prices.

Local Central Bank and Treasury Bonds				Prices (internal rates of return) are provided by third party price providers that are widely used in the Chilean market. Model is based on daily prices.

Mortgage Notes				Prices (internal rates of return) are provided by third party price providers that are widely used in the Chilean market. Model is based on a Base Yield (Central Bank Bonds) and issuer spread. The model takes into consideration daily prices and risk/maturity similarities between instruments.

Time Deposits				Prices are provided by third party price providers that are widely used in the Chilean market. Model is based on daily prices and considers risk/maturity similarities between instruments.

Cross Currency Swaps, Interest Rate Swaps, FX Forwards, Inflation Forwards				Forward Points, Inflation forecast and local swap rates are provided by market brokers that are widely used in the Chilean market Offshore rates and spreads are obtained from third party price providers that are widely used in the Chilean market. Zero Coupon rates are calculated by using the bootstrapping method over swap rates.

FX Options		Black-Scholes Model		Prices for volatility surface estimates are obtained from market brokers that are widely used in the Chilean market.

Type of Financial Instrument		Valuation Method		Description: Inputs and Sources
Local Bank and Corporate Bonds		Discounted cash flows model		Since inputs for these types of securities are not observable by the market, we model interest rate of returns for them based on a Base Yield (Central Bank Bonds) and issuer spread. These inputs (base yield and issuer spread) are provided on a daily basis by third party price providers that are widely used in the Chilean market.

Offshore Bank and Corporate Bonds		Discounted cash flows model		Since inputs for these types of securities are not observable by the market, we model interest rate of returns for them based on a Base Yield (US-Libor) and issuer spread. These inputs (base yield and issuer spread) are provided on a weekly basis by third party price providers that are widely used in the Chilean market.

Schedule of Fair Value of Financial Assets Liabilities on the Balance Sheet

The following table shows the classification by levels, for financial instruments registered at fair value.

		Level 1								Level 2								Level 3								Total
		2023				2022				2023				2022				2023				2022				2023				2022
		MCh$				MCh$				MCh$				MCh$				MCh$				MCh$				MCh$				MCh$
Financial Assets
Financial Assets held for trading at fair value through profit or loss
Derivative contracts financial:
Forwards			—				—				212,639				566,050				—				—				212,639				566,050
Swaps			—				—				1,818,155				2,389,577				—				—				1,818,155				2,389,577
Call Options			—				—				3,435				2,321				—				—				3,435				2,321
Put Options			—				—				1,311				2,758				—				—				1,311				2,758
Futures			—				—				—				—				—				—				—				—
Subtotal			—				—				2,035,540				2,960,706				—				—				2,035,540				2,960,706
Debt Financial Instruments:
From the Chilean Government and Central Bank			181,702				28,128				2,845,611				3,031,164				—				—				3,027,313				3,059,292
Other debt financial instruments issued in Chile			—				—				301,948				273,934				34,363				100,519				336,311				374,453
Financial debt instruments issued Abroad			—				—				—				—				—				—				—				—
Subtotal			181,702				28,128				3,147,559				3,305,098				34,363				100,519				3,363,624				3,433,745

Others			409,328				257,325				—				—				—				—				409,328				257,325

Financial Assets at fair value through Other Comprehensive Income
Debt Financial Instruments: (1)
From the Chilean Government and Central Bank			532,203				552,763				1,305,449				1,706,094				—				—				1,837,652				2,258,857
Other debt financial instruments issued in Chile			—				—				1,653,182				1,499,625				88,483				41,283				1,741,665				1,540,908
Financial debt instruments issued Abroad			—				—				207,208				167,627				—				—				207,208				167,627
Equity Instruments:
Instruments issued in Chile			10,243				5,342				—				—				358				358				10,601				5,700
Instruments issued abroad			1,286				820				—				—				25				25				1,311				845
Subtotal			543,732				558,925				3,165,839				3,373,346				88,866				41,666				3,798,437				3,973,937

Derivative contracts financial for hedging purposes
Forwards			—				—				—				—				—				—				—				—
Swaps			—				—				49,065				27,077				—				—				49,065				27,077
Call Options			—				—				—				—				—				—				—				—
Put Options			—				—				—				—				—				—				—				—
Futures			—				—				—				—				—				—				—				—
Subtotal			—				—				49,065				27,077				—				—				49,065				27,077
Total			1,134,762				844,378				8,398,003				9,666,227				123,229				142,185				9,655,994				10,652,790

Financial Liabilities
Financial liabilities held for trading at fair value through profit or loss
Derivative contracts financial:
Forwards			—				—				221,626				535,630				—				—				221,626				535,630
Swaps			—				—				1,969,558				2,560,285				—				—				1,969,558				2,560,285
Call Options			—				—				1,061				1,665				—				—				1,061				1,665
Put Options			—				—				3,871				3,889				—				—				3,871				3,889
Futures			—				—				—				—				—				—				—				—
Subtotal			—				—				2,196,116				3,101,469				—				—				2,196,116				3,101,469

Others			—				—				2,305				6,271				—				—				2,305				6,271

Derivative contracts financial for hedging purposes
Forwards			—				—				—				—				—				—				—				—
Swaps			—				—				160,602				223,016				—				—				160,602				223,016
Call Options			—				—				—				—				—				—				—				—
Put Options			—				—				—				—				—				—				—				—
Futures			—				—				—				—				—				—				—				—
Subtotal			—				—				160,602				223,016				—				—				160,602				223,016
Total			—				—				2,359,023				3,330,756				—				—				2,359,023				3,330,756

(1)

As of December 31, 2023, 100% of instruments of level 3 have denomination “Investment Grade”. Also, 100% of total of these financial instruments correspond to domestic issuers.

Schedule of Reconciliation Between the Beginning and Ending Balances of Instruments

The following table shows the reconciliation between the balances at the beginning and at the end of year for those instruments classified in Level 3, whose fair value is reflected in the Consolidated Financial Statements:

		2023
		Balance as of January 1, 2023				Gain (Loss) Recognized in Income (1)				Gain (Loss) Recognized in Equity (2)				Purchases				Sales				Transfer from Level 1 and 2				Transfer to Level 1 and 2				Balance as of December 31, 2023
		MCh$				MCh$				MCh$				MCh$				MCh$				MCh$				MCh$				MCh$
Financial Assets held for trading at fair value through profit or loss
Debt Financial Instruments:
Other debt financial instruments issued in Chile			100,519				767				—				18,085				(62,179	)			15,190				(38,019	)			34,363
Subtotal			100,519				767				—				18,085				(62,179	)			15,190				(38,019	)			34,363

Financial Assets at fair value through Other Comprehensive Income:
Debt Financial Instruments:
Other debt financial instruments issued in Chile			41,283				4,093				(7,355	)			63,930				(1,695	)			3,951				(15,724	)			88,483
Equity Instruments:
Instruments issued in Chile			358				—				—				—				—				—				—				358
Instruments issued abroad			25				—				—				—				—				—				—				25
Subtotal			41,666				4,093				(7,355	)			63,930				(1,695	)			3,951				(15,724	)			88,866

Total			142,185				4,860				(7,355	)			82,015				(63,874	)			19,141				(53,743	)			123,229

		2022
		Balance as of January 1, 2022				Gain (Loss) Recognized in Income (1)				Gain (Loss) Recognized in Equity (2)				Purchases				Sales				Transfer from Level 1 and 2				Transfer to Level 1 and 2				Balance as of December 31, 2022
		MCh$				MCh$				MCh$				MCh$				MCh$				MCh$				MCh$				MCh$
Financial Assets held for trading at fair value through profit or loss
Debt Financial Instruments:
Other debt financial instruments issued in Chile			51,484				902				—				111,960				(63,827	)			—				—				100,519
Subtotal			51,484				902				—				111,960				(63,827	)			—				—				100,519

Financial Assets at fair value through Other Comprehensive Income:
Debt Financial Instruments:
Other debt financial instruments issued in Chile			25,203				(1,477	)			4,921				25,044				(12,408	)			—				—				41,283
Equity Instruments:
Instruments issued in Chile			218				—				140				—				—				—				—				358
Instruments issued abroad			25				—				—				—				—				—				—				25
Subtotal			25,446				(1,477	)			5,061				25,044				(12,408	)			—				—				41,666

Total			76,930				(575	)			5,061				137,004				(76,235	)			—				—				142,185

(1)

Recorded in income under item “Net Financial income (expense)”.

(2)

Recorded in equity under item “Accumulated other comprehensive income”.

Schedule of Instruments Classified in Level 3 using Alternative in Key Valuation Assumptions

The following table shows the sensitivity, by type of instrument, of those instruments classified in Level 3 using alternative in key valuation assumptions:

		As of December 31, 2023								As of December 31, 2022
		Level 3				Sensitivity to changes in key assumptions of models				Level 3				Sensitivity to changes in key assumptions of models
		MCh$				MCh$				MCh$				MCh$

Financial Assets held for trading at fair value through profit or loss
Debt Financial Instruments:
Other debt financial instruments issued in Chile			34,363				(696	)			100,519				(997	)
Subtotal			34,363				(696	)			100,519				(997	)

Financial Assets at fair value through Other Comprehensive Income
Debt Financial Instruments:
Other debt financial instruments issued in Chile			88,483				(2,721	)			41,283				(1,263	)
Equity Instruments:
Instruments issued in Chile			358				—				358				—
Instruments issued abroad			25				—				25				—
Subtotal			88,866				(2,721	)			41,666				(1,263	)
Total			123,229				(3,417	)			142,185				(2,260	)

Schedule of Fair Values of the Financial Assets and Liabilities that are not Recorded at Fair Value in the Statement of Financial Position

The following table summarizes the fair values of the Bank’s main financial assets and liabilities that are not recorded at fair value in the Statement of Financial Position.

		Book Value								Estimated Fair Value
		2023				2022				2023				2022
		MCh$				MCh$				MCh$				MCh$

Assets
Cash and due from banks			2,464,648				2,764,884				2,464,648				2,764,884
Transactions in the course of collection			415,505				772,196				415,505				772,196
Subtotal			2,880,153				3,537,080				2,880,153				3,537,080
Financial assets at amortized cost
Rights by resale agreements and securities lending			71,822				54,061				71,822				54,061
Debt financial instruments			1,431,083				902,355				1,368,416				836,527
Loans and advances to Banks
Domestic banks			—				—				—				—
Central Bank of Chile			2,100,933				1,801,100				2,100,933				1,801,100
Foreign banks			417,657				372,051				412,662				369,526
Subtotal			4,021,495				3,129,567				3,953,833				3,061,214
Loans to customers, net
Commercial loans			19,770,403				19,987,278				19,193,778				19,161,774
Residential mortgage loans			12,277,266				11,371,676				11,656,071				11,138,046
Consumer loans			4,893,418				4,545,734				5,025,163				4,608,041
Subtotal			36,941,087				35,904,688				35,875,012				34,907,861
Total			43,842,735				42,571,335				42,708,998				41,506,155

Liabilities
Transactions in the course of payment			356,871				681,792				356,871				681,792
Financial liabilities at amortized cost
Current accounts and other demand deposits			13,670,793				13,592,155				13,670,793				13,592,155
Saving accounts and time deposits			15,538,196				14,358,987				15,536,406				14,342,841
Obligations by repurchase agreements and securities lending			157,173				216,264				157,173				216,264
Borrowings from financial institutions			5,360,715				5,397,676				5,152,776				4,844,427
Debt financial instruments issued
Letters of credit for residential purposes			1,433				2,328				1,533				2,466
Letters of credit for general purposes			11				49				12				52
Bonds			9,358,621				9,265,570				9,090,188				9,030,443
Other financial obligations			339,305				344,030				339,327				363,809
Subtotal			44,426,247				43,177,059				43,948,208				42,392,457
Debt financial instruments issued for regulatory capital purposes
Subordinate bonds			1,039,814				1,010,905				1,035,801				1,002,250
Total			45,822,932				44,869,756				45,340,880				44,076,499

Schedule of Fair Value Financial Assets and Liabilities not Measured at Fair Value on the Balance Sheet

The table below sets forth the fair value of Financial Assets and Liabilities not measured at fair value on the balance sheet, for the years ended December 31, 2023 and 2022:

		Level 1 Estimated Fair Value								Level 2 Estimated Fair Value								Level 3 Estimated Fair Value								Total Estimated Fair Value
		2023				2022				2023				2022				2023				2022				2023				2022
		MCh$				MCh$				MCh$				MCh$				MCh$				MCh$				MCh$				MCh$

Assets
Cash and due from banks			2,464,648				2,764,884				—				—				—				—				2,464,648				2,764,884
Transactions in the course of collection			415,505				772,196				—				—				—				—				415,505				772,196
Subtotal			2,880,153				3,537,080				—				—				—				—				2,880,153				3,537,080
Financial assets at amortized cost
Rights by resale agreements and securities lending			71,822				54,061				—				—				—				—				71,822				54,061
Debt financial instruments			1,368,416				836,527				—				—				—				—				1,368,416				836,527
Loans and advances to Banks
Domestic banks			—				—				—				—				—				—				—				—
Central Bank of Chile			2,100,933				1,801,100				—				—				—				—				2,100,933				1,801,100
Foreign banks			—				—				—				—				412,662				369,526				412,662				369,526
Subtotal			3,541,171				2,691,688				—				—				412,662				369,526				3,953,833				3,061,214
Loans to customers, net
Commercial loans			—				—				—				—				19,193,778				19,161,774				19,193,778				19,161,774
Residential mortgage loans			—				—				—				—				11,656,071				11,138,046				11,656,071				11,138,046
Consumer loans			—				—				—				—				5,025,163				4,608,041				5,025,163				4,608,041
Subtotal			—				—				—				—				35,875,012				34,907,861				35,875,012				34,907,861
Total			6,421,324				6,228,768				—				—				36,287,674				35,277,387				42,708,998				41,506,155

Liabilities
Transactions in the course of payment			356,871				681,792				—				—				—				—				356,871				681,792
Financial liabilities at amortized cost
Current accounts and other demand deposits			13,670,793				13,592,155				—				—				—				—				13,670,793				13,592,155
Saving accounts and time deposits			—				—				—				—				15,536,406				14,342,841				15,536,406				14,342,841
Obligations by repurchase agreements and securities lending			157,173				216,264				—				—				—				—				157,173				216,264
Borrowings from financial institutions			—				—				—				—				5,152,776				4,844,427				5,152,776				4,844,427
Debt financial instruments issued
Letters of credit for residential purposes			—				—				1,533				2,466				—				—				1,533				2,466
Letters of credit for general purposes			—				—				12				52				—				—				12				52
Bonds			—				—				9,090,188				9,030,443				—				—				9,090,188				9,030,443
Other financial obligations			—				—				—				—				339,327				363,809				339,327				363,809
Subtotal			13,827,966				13,808,419				9,091,733				9,032,961				21,028,509				19,551,077				43,948,208				42,392,457
Debt financial instruments issued for regulatory capital purposes
Subordinate bonds			—				—				—				—				1,035,801				1,002,250				1,035,801				1,002,250
Total			14,184,837				14,490,211				9,091,733				9,032,961				22,064,310				20,553,327				45,340,880				44,076,499