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Fixed Assets and Right of Use Assets and Lease Liability

12 Months Ended

Dec. 31, 2019

Fixed Assets And Right Of Use Assets And Lease Liability

FIXED ASSETS AND RIGHT OF USE ASSETS AND LEASE LIABILITY

NOTE 14

FIXED ASSETS AND RIGHT OF USE ASSETS AND LEASE LIABILITY

As of December 31, 2019 and 2018, the composition of property, plant, and equipment balances are composed as follows:

			As of December 31, 2019
	Net opening balance as of January 1, 2019		Gross balance		Accumulated depreciation			Net balance
	MCh$		MCh$		MCh$			MCh$

Land and buildings		174,758		295		(121,338	)		174
Equipment		56,865		219,600		(164,106	)		55,494
Other		21,963		69,758		(47,552	)		22,206
Total		253,586		585,342		(332,996	)		252,346

			As of December 31, 2018
	Net opening balance as of January 1, 2018		Gross balance		Accumulated depreciation			Net balance
	MCh$		MCh$		MCh$			MCh$

Land and buildings		159,352		289,568		(114,810	)		174,758
Equipment		63,516		192,328		(135,463	)		56,865
Other		15,458		62,156		(40,193	)		21,963
Total		238,326		544,052		(290,466	)		253,586

The changes in the value of property, plant, and equipment as of December 31, 2019 and 2018 is as follows:

b.1

Gross balance

2019	Land and buildings			Equipment			Other		Total
	MCh$			MCh$			MCh$		MCh$

Balances as of January 1, 2019		289,568			192,328			62,156		544,052
Additions		10,065			33,302			7,602		50,969
Disposals		(2,636	)		(6,030	)		-		(8,666	)
Impairment due to damage (*)		(1,013	)		-			-		(1,013	)
Other		-			-			-		-
Balances as of December 31, 2019		295,984			219,600			69,758		585,342

(*) Banco Santander-Chile have recognized in its consolidated financial statements as of December 31, 2019 an impairment of $ 1,013 million, due to social unrest in the country. See Note 33.

2018	Land and buildings			Equipment			Other			Total
	MCh$			MCh$			MCh$			MCh$

Balances as of January 1, 2018		259,316			169,286			55,613			484,215
Additions		30,396			27,697			8,646			66,739
Disposals		(144	)		(4,616	)		(2,103	)		(6,863	)
Impairment due to damage		-			(39	)		-			(39	)
Other		-			-			-			-
Balances as of December 31, 2018		289,568			192,328			62,156			544,052

(*) Banco Santander-Chile has had to recognize in its financial statements as of December 31, 2018 impairment by $ 39 million, corresponding to looting in ATM's.

b.2

Accumulated depreciation

2019	Land and buildings			Equipment			Other			Total
	MCh$			MCh$			MCh$			MCh$

Balances as of January 1, 2019		(114,810	)		(135,463	)		(40,193	)		(290,466	)
Depreciation charges in the period		(16,018	)		(29,968	)		(6,869	)		(52,855	)
Sales and disposals in the period		9,490			1,325			-			10,815
Other		-			-			(490	)		(490	)
Balances as of December 31, 2019		(121,338	)		(164,106	)		(47,552	)		(332,996	)

2018	Land and buildings			Equipment			Other			Total
	MCh$			MCh$			MCh$			MCh$

Balances as of January 1, 2018		(97,267	)		(109,843	)		(34,558	)		(241,668	)
Depreciation charges in the period		(17,585	)		(25,660	)		(5,635	)		(48,880	)
Sales and disposals in the period		42			40			-			82
Other		-			-			-			-
Balances as of December 31, 2018		(114,810	)		(135,463	)		(40,193	)		(290,466	)

The composition of the right of use assets as of December 31, 2019 and January 1, 2019 is as follows:

			As of December 31, 2019
	First application balance as of January 1, 2019		Gross balance		Accumulated depreciation			Net balance
	MCh$		MCh$		MCh$			MCh$
Land and building		154,284		181,325		(25,338	)		155,987
Equipment		-		-		-			-
Other		-		-		-			-
Total		154,284		181,325		(25,338	)		155,987

The movement of the right of use assets under lease during the 2019 period, is as follows:

d.1)

Gross balance

2019	Land and building			Lease improvements			Equipment		Other		Total
	MCh$			MCh$			MCh$		MCh$		MCh$
Balances as of January 1, 2019 (*)		154,284			122,658			-		-		154,284
Additions		46,423			7,013			-		-		46,423
Disposals		(17,669	)		(2,636	)		-		-		(17,669	)
Impairment		(1,713	)		-			-		-		(1,713	)
Other		-			-			-		-		-
Balances as of December 31, 2019		181,325			127,035			-		-		181,325

(*) See Note N° 02.

d.2)

Accumulated amortization

2019	Land and building			Lease improvements			Equipment		Other		Total
	MCh$			MCh$			MCh$		MCh$		MCh$
Balances as of January 1, 2019 (*)		-			(68,145	)
Amortization for the period		(26,889	)		(7,898	)		-		-		(26,889	)
Sales and disposals during the period		1,551			1,936			-		-		1,551
Transfers		-			-			-		-		-
Others		-			-			-		-		-
Balances as of December 31, 2019		(25,338	)		(74,107	)		-		-		(25,338	)

(*) See Note N° 02.

Lease liability:

As of December 31, 2019 and 2018, the composition of lease liability balances are composed as follows:

	As of December 31,
	2019		2018
	MCh$		MCh$
Lease liability		158,494		-
Total		158,494		-

An explanation of the difference between operating lease commitment under IAS 17 at December 31, 2018 and initial application of IFRS 16 as of January 1, 2019 is as follows:

	MCh$
Operating lease commitments as at December 31, 2018		173,602

Discounted using the lessee´s incremental borrowing rate of at the date of initial application		14,726
Lease liabilities recognised due to IFRS 16 implementation		139,558
Lease liability recognised as at January 1, 2019		154,284

Expenses associated with assets for the right of use leased assets and lease liability

	As of December 31,
	2019			2018
	MCh$			MCh$
Depreciation		(26,889	)		-
Interests		(2,965	)		-
Short term lease		(4,177	)		-
Total		(34,031	)		-

As of December 31, 2019 and 2018, the maturity level of the lease liability, according to their contractual maturity is as follows:

	As of December 31,
	2019		2018
	MCh$		MCh$
Due within 1 year		26,061		-
Due after 1 year but within 2 years		24,311		-
Due after 2 years but within 3 years		21,667		-
Due after 3 years but within 4 years		19,411		-
Due after 4 years but within 5 years		16,982		-
Due after 5 years		50,062		-
Total		158,494		-

Operational leases – lessor

As of December 31, 2019 and 2018, the future minimum lease cash inflows under non-cancellable operating leases are as follows:

	As of December 31,
	2019		2018
	MCh$		MCh$

Due within 1 year		603		469
Due after 1 year but within 2 years		598		882
Due after 2 years but within 3 years		500		469
Due after 3 years but within 4 years		498		460
Due after 4 years but within 5 years		412		428
Due after 5 years		1,563		2,242

Total		4,174		4,950

As of December 31, 2019 and 2018, the Bank has no financial leases which cannot be unilaterally rescinded.

The Bank has no restriction on property, plant and equipment as of December 31, 2019 and 2018. Additionally, the property, plant and equipment have not been provided as guarantees of financial liabilities. The Bank has no debt in connection with property, plant and equipment.