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Financial risk review | 12 Months Ended
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Dec. 31, 2023
Disclosure of credit risk exposure [abstract] |
Financial risk review | A. Credit risk i. Credit quality analysis The following tables set out information about the credit quality of financial assets measured at amortized cost, and debt instruments at FVOCI. Unless specifically indicated, for financial assets the amounts in the table represent the outstanding gross balances. For loan commitments and financial guarantee contracts, the amounts in the table represent the amounts committed or guaranteed, respectively. Explanation of the terms ‘Stage 1’, ‘Stage 2’ and ‘Stage 3’ is included in Note 3.4 (K). Loans at amortized cost, outstanding balance
| December 31, 2023
| PD Ranges |  | Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Grades 1 - 4 | 0.03 - 0.74 |  | 2,893,562 |  |  | — |  |  | — |  |  | 2,893,562 |
Grades 5 - 6 | 0.75 - 3.80 |  | 3,680,969 |  |  | 237,878 |  |  | — |  |  | 3,918,847 |
Grades 7 - 8 | 3.81 - 34.51 |  | 303,445 |  |  | 69,606 |  |  | — |  |  | 373,051 |
Grades 9 - 10 | 34.52 - 100 |  | — |  |  | — |  |  | 10,107 |  |  | 10,107 |
|  |  | 6,877,976 |  |  | 307,484 |  |  | 10,107 |  |  | 7,195,567 |
Loss allowance |  |  | (34,778) |  |  | (17,734) |  |  | (6,898) |  |  | (59,410) |
Total |  |  | 6,843,198 |  |  | 289,750 |  |  | 3,209 |  |  | 7,136,157 |
| December 31, 2022
| PD Ranges |  | Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Grades 1 - 4 | 0.03 - 0.74 |  | 2,864,686 |  |  | — |  |  | — |  |  | 2,864,686 |
Grades 5 - 6 | 0.75 - 3.80 |  | 3,645,901 |  |  | 50,625 |  |  | — |  |  | 3,696,526 |
Grades 7 - 8 | 3.81 - 34.51 |  | 123,603 |  |  | 48,098 |  |  | 20,000 |  |  | 191,701 |
Grades 9 - 10 | 34.52 - 100 |  | — |  |  | — |  |  | 10,107 |  |  | 10,107 |
|  |  | 6,634,190 |  |  | 98,723 |  |  | 30,107 |  |  | 6,763,020 |
Loss allowance |  |  | (28,589) |  |  | (5,050) |  |  | (21,561) |  |  | (55,200) |
Total |  |  | 6,605,601 |  |  | 93,673 |  |  | 8,546 |  |  | 6,707,820 |
A. Credit risk (continued) Loan commitments, financial guarantees issued and customers’ liabilities under acceptances
| December 31, 2023
| 12-month PD Ranges |  | Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Commitments and financial guarantees issued |  |  |  |  |  |  |  |  |
Grades 1 - 4 | 0.03 - 0.74 |  | 457,901 |  |  | — |  |  | — |  |  | 457,901 |
Grades 5 - 6 | 0.75 - 3.80 |  | 416,786 |  |  | 24,996 |  |  | — |  |  | 441,782 |
Grades 7 - 8 | 3.81 - 34.51 |  | 160,473 |  |  | 3,550 |  |  | — |  |  | 164,023 |
|  |  | 1,035,160 |  |  | 28,546 |  |  | — |  |  | 1,063,706 |
Customers' liabilities under acceptances |  |  |  |  |  |  |  |  |
Grades 1 - 4 | 0.03 - 0.74 |  | 163,438 |  |  | — |  |  | — |  |  | 163,438 |
Grades 5 - 6 | 0.75 - 3.80 |  | 2,009 |  |  | — |  |  | — |  |  | 2,009 |
Grades 7 - 8 | 3.81 - 34.51 |  | 95,981 |  |  | — |  |  | — |  |  | 95,981 |
|  |  | 261,428 |  |  | — |  |  | — |  |  | 261,428 |
|  |  | 1,296,588 |  |  | 28,546 |  |  | — |  |  | 1,325,134 |
Loss allowance |  |  | (3,905) |  |  | (1,154) |  |  | — |  |  | (5,059) |
Total |  |  | 1,292,683 |  |  | 27,392 |  |  | — |  |  | 1,320,075 |
| December 31, 2022
| 12-month PD Ranges |  | Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Commitments and financial guarantees issued |  |  |  |  |  |  |  |  |
Grades 1 - 4 | 0.03 - 0.74 |  | 302,260 |  |  | — |  |  | — |  |  | 302,260 |
Grades 5 - 6 | 0.75 - 3.80 |  | 279,550 |  |  | 1,700 |  |  | — |  |  | 281,250 |
Grades 7 - 8 | 3.81 - 34.51 |  | 195,864 |  |  | — |  |  | — |  |  | 195,864 |
|  |  | 777,674 |  |  | 1,700 |  |  | — |  |  | 779,374 |
Customers' liabilities under acceptances |  |  |  |  |  |  |  |  |
Grades 1 - 4 | 0.03 - 0.74 |  | 34,258 |  |  | — |  |  | — |  |  | 34,258 |
Grades 5 - 6 | 0.75 - 3.80 |  | 19,782 |  |  | — |  |  | — |  |  | 19,782 |
Grades 7 - 8 | 3.81 - 34.51 |  | 109,305 |  |  | — |  |  | — |  |  | 109,305 |
|  |  | 163,345 |  |  | — |  |  | — |  |  | 163,345 |
|  |  | 941,019 |  |  | 1,700 |  |  | — |  |  | 942,719 |
Loss allowance |  |  | (3,605) |  |  | (23) |  |  | — |  |  | (3,628) |
Total |  |  | 937,414 |  |  | 1,677 |  |  | — |  |  | 939,091 |
A. Credit risk (continued) Securities at amortized cost
| December 31, 2023
| 12-month DP Ranges |  | Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Grades 1 - 4 | 0.03 - 0.74 |  | 913,524 |  |  | — |  |  | — |  |  | 913,524 |
Grades 5 - 6 | 0.75 - 3.80 |  | 57,674 |  |  | 28,346 |  |  | — |  |  | 86,020 |
|  |  | 971,198 |  |  | 28,346 |  |  | — |  |  | 999,544 |
Loss allowance |  |  | (1,230) |  |  | (402) |  |  | — |  |  | (1,632) |
Total |  |  | 969,968 |  |  | 27,944 |  |  | — |  |  | 997,912 |
| December 31, 2022
| 12-month PD Ranges |  | Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Grades 1 - 4 | 0.03 - 0.74 |  | 736,139 |  |  | — |  |  | — |  |  | 736,139 |
Grades 5 - 6 | 0.75 - 3.80 |  | 154,248 |  |  | 46,589 |  |  | — |  |  | 200,837 |
Grades 7 - 8 | 3.81 - 34.51 |  | — |  |  | — |  |  | 4,995 |  |  | 4,995 |
|  |  | 890,387 |  |  | 46,589 |  |  | 4,995 |  |  | 941,971 |
Loss allowance |  |  | (2,170) |  |  | (1,779) |  |  | (4,002) |  |  | (7,951) |
Total |  |  | 888,217 |  |  | 44,810 |  |  | 993 |  |  | 934,020 |
Securities at FVOCI
| December 31, 2023
| 12-month PD Ranges |  | Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Grades 1 - 4 | 0.03 - 0.74 |  | 11,824 |  |  | — |  |  | — |  |  | 11,824 |
|  |  | 11,824 |  |  | — |  |  | — |  |  | 11,824 |
Loss allowance |  |  | (1) |  |  | — |  |  | — |  |  | (1) |
Total |  |  | 11,823 |  |  | — |  |  | — |  |  | 11,823 |
| December 31, 2022
| 12-month PD Ranges |  | Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Grades 1 - 4 | 0.03 - 0.74 |  | 77,972 |  |  | — |  |  | — |  |  | 77,972 |
|  |  | 77,972 |  |  | — |  |  | — |  |  | 77,972 |
Loss allowance |  |  | (10) |  |  | — |  |  | — |  |  | (10) |
Total |  |  | 77,962 |  |  | — |  |  | — |  |  | 77,962 |
A. Credit risk (continued) The following table presents information of the current and past due balances of loans at amortized cost in stages 1, 2 and 3:
| December 31, 2023
| Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Current | 6,873,737 |  |  | 311,723 |  |  | — |  |  | 7,185,460 |
Past due | — |  |  | — |  |  | 10,107 |  |  | 10,107 |
Total | 6,873,737 |  |  | 311,723 |  |  | 10,107 |  |  | 7,195,567 |
| December 31, 2022
| Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Current | 6,634,190 |  |  | 98,723 |  |  | — |  |  | 6,732,913 |
Defaulters | — |  |  | — |  |  | 20,000 |  |  | 20,000 |
Past due | — |  |  | — |  |  | 10,107 |  |  | 10,107 |
Total | 6,634,190 |  |  | 98,723 |  |  | 30,107 |  |  | 6,763,020 |
The following table presents an analysis of counterparty credit exposures arising from derivative transactions. The Bank's derivative fair values are generally secured by cash.
| December 31, 2023
| Notional value USD |  | Derivative financial instruments - fair value assets |  | Derivative financial instruments - fair value liabilities
Interest rate swaps | 987,394 |  |  | 11,358 |  |  | (790) |
Cross-currency swaps | 1,678,042 |  |  | 145,909 |  |  | (39,823) |
Total | 2,665,436 |  |  | 157,267 |  |  | (40,613) |
| December 31, 2022
| Notional value USD |  | Derivative financial instruments - fair value assets |  | Derivative financial instruments - fair value liabilities
Interest rate swaps | 368,711 |  |  | 483 |  |  | (544) |
Cross-currency swaps | 1,175,570 |  |  | 45,806 |  |  | (33,217) |
Foreign exchange forwards | 189,173 |  |  | 21,870 |  |  | — |
Total | 1,733,454 |  |  | 68,159 |  |  | (33,761) |
A. Credit risk (continued) ii. Collateral and other credit enhancements The amount and type of collateral required depends on an assessment of the credit risk of the counterparty. Guidelines are in place covering the acceptability and valuation of each type of collateral. Derivatives and repurchase agreements In the ordinary course of business, the Bank enters into derivative financial instrument transactions and securities sold under repurchase agreements under industry standard agreements. Depending on the collateral requirements stated in the contracts, the Bank and counterparties can receive or deliver collateral based on the fair value of the financial instruments transacted between parties. Collateral typically consists of pledged cash deposits and securities. The master netting agreements include clauses that, in the event of default, provide for close-out netting, which allows all positions with the defaulting counterparty to be terminated and net settled with a single payment amount. The International Swaps and Derivatives Association master agreement (“ISDA”) and similar master netting arrangements do not meet the criteria for offsetting in the consolidated statement of financial position. This is because they create for the parties to the agreement a right of set-off of recognized amounts that is enforceable only following an event of default, insolvency or bankruptcy of the Bank or the counterparties or following other predetermined events. Such arrangements provide for single net settlement of all financial instruments covered only by the agreements in the event of default on any one contract. Master netting arrangements do not normally result in an offset of balance–sheet assets and liabilities unless certain conditions for offsetting are met. Although master netting arrangements may significantly reduce credit risk, it should be noted that: - Credit risk is eliminated only to the extent that amounts due to the same counterparty will be settled after the assets are realized. - The extent to which overall credit risk is reduced may change substantially within a short period because the exposure is affected by each transaction subject to the arrangement. Loans The main types of collateral obtained for commercial lending are as follows: - Liens on real estate property, inventory and trade receivables. The Bank also obtains guarantees from parent companies for loans to their subsidiaries. Management monitors the market value of collateral and will request additional collateral in accordance with the underlying agreement. It is the Bank’s policy to dispose of repossessed property in an orderly fashion. The proceeds are used to reduce or repay the outstanding claim. In general, the Bank does not occupy repossessed property or received in lieu of payment, for business use. The Bank holds guarantees and other financial credit enhancements against certain exposures in the loan portfolio. As of December 31, 2023, and 2022, the coverage ratio to the carrying amount of the loan portfolio was 16% and 12%. iii. Incorporation of forward-looking information The Bank incorporates information about forward-looking economic environment, when assessing whether the credit risk of a financial instrument has significantly increased since initial recognition applying customer and country risk rating models which include projections of the inputs under analysis. A. Credit risk (continued) Supplementary, for the expected credit loss measurement, the results of the “alert model” can be considered, through the assessment of a severity indicator to total risk resulting from the estimates and assumptions of several macroeconomic factors. These estimates and assumptions are supported by a base scenario. Other scenarios represent upside and downside results. The implementation and interpretation of the outcomes of the alert model are based on Management´s expert judgment, pondering on suggestions of areas such as Credit Risk, Economic Studies and Loan Recovery of the Bank. The external information could include economic data and projections published by governmental committees, monetary agencies (for example, the U.S. Federal Reserve and banking authorities from countries where the Bank operates), supranational organizations (International Monetary Fund, The World Bank, World Trade Organization), private sector, academic projections, credit rating agencies, among other. Main macroeconomic variables of the alert model with forward-looking scenarios are:
Variables |  | Description
GDP Growth (Var. %) |  | % Variation in the growth of the Gross Domestic Product (GDP)
ComEx Growth Index (Var. %) |  | % Variation in foreign trade growth (Export + Import)
The model uses, as main inputs, the percentage variation of the gross domestic product and the percentage of the foreign trade growth index. The main movements and changes in the variables are analyzed, in general and in particular for each country in the region. The historical and projected information over a period of five years allows Management to estimate the macroeconomic effects in the Bank's portfolio. A. Credit risk (continued) The table below lists the alert model's macroeconomic assumptions for countries representing the higher exposures, for the base, upside and downside scenarios over the five-year forecasted average available for each reporting period.
|  |  |  | Variable
|  |  |  | GDP Growth (Var.% ) |  | ComEx Growth Index (Var.% )
|  | Scenario |  | December 31, 2023 |  | December 31, 2022 |  | December 31, 2023 |  | December 31, 2022
|  | Base |  | 2.1 | % |  | 1.9 | % |  | 2.5 | % |  | 7.1 | %
Brazil |  | Upside |  | 3.1 | % |  | 2.9 | % |  | 6.0 | % |  | 10.6 | %
|  | Downside |  | 0.7 | % |  | 0.5 | % |  | -1.5 | % |  | 3.1 | %
|  | Base |  | 1.8 | % |  | 1.7 | % |  | 1.4 | % |  | 3.1 | %
Chile |  | Upside |  | 2.9 | % |  | 2.8 | % |  | 4.9 | % |  | 6.6 | %
|  | Downside |  | 0.6 | % |  | 0.5 | % |  | -2.6 | % |  | -0.9 | %
|  | Base |  | 2.4 | % |  | 3.6 | % |  | 0.2 | % |  | 8.4 | %
Colombia |  | Upside |  | 3.5 | % |  | 4.7 | % |  | 3.2 | % |  | 11.4 | %
|  | Downside |  | 1.1 | % |  | 2.3 | % |  | -3.3 | % |  | 4.9 | %
|  | Base |  | 4.2 | % |  | 4.8 | % |  | 3.6 | % |  | 5.8 | %
Dominican Republic |  | Upside |  | 5.4 | % |  | 6.0 | % |  | 7.1 | % |  | 9.3 | %
|  | Downside |  | 2.9 | % |  | 3.5 | % |  | -0.4 | % |  | 1.8 | %
|  | Base |  | 1.8 | % |  | 2.6 | % |  | 0.2 | % |  | 5.7 | %
Ecuador |  | Upside |  | 2.8 | % |  | 3.6 | % |  | 3.2 | % |  | 8.7 | %
|  | Downside |  | 0.3 | % |  | 1.1 | % |  | -3.3 | % |  | 2.2 | %
|  | Base |  | 3.4 | % |  | 3.5 | % |  | 4.7 | % |  | 5.8 | %
Guatemala |  | Upside |  | 4.4 | % |  | 4.5 | % |  | 7.7 | % |  | 8.8 | %
|  | Downside |  | 2.2 | % |  | 2.3 | % |  | 1.2 | % |  | 2.3 | %
|  | Base |  | 2.4 | % |  | 1.9 | % |  | 4.9 | % |  | 6.4 | %
Mexico |  | Upside |  | 3.4 | % |  | 2.9 | % |  | 8.9 | % |  | 10.4 | %
|  | Downside |  | 1.2 | % |  | 0.7 | % |  | 0.4 | % |  | 1.9 | %
|  | Base |  | 2.3 | % |  | 2.9 | % |  | 2.7 | % |  | 4.9 | %
Peru |  | Upside |  | 3.3 | % |  | 3.9 | % |  | 6.2 | % |  | 8.4 | %
|  | Downside |  | 1.1 | % |  | 1.7 | % |  | -1.3 | % |  | 0.9 | %
iv. Loss allowances The following tables show reconciliations from the opening to the closing balances of the loss allowance by class of financial instrument. The basis for determining transfers due to changes in credit risk is set out in our accounting policy in Note 3.4 (K). A. Credit risk (continued) Loans at amortized cost
| Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Allowance for expected credit losses as of December 31, 2022 | 28,589 |  |  | 5,050 |  |  | 21,561 |  |  | 55,200 |
Transfer to lifetime expected credit losses | (752) |  |  | 752 |  |  | — |  |  | — |
Net effect of changes in allowance for expected credit losses | (2,363) |  |  | 11,195 |  |  | 6,481 |  |  | 15,313 |
Financial instruments that have been derecognized during the year | (17,950) |  |  | (879) |  |  | — |  |  | (18,829) |
New instruments originated or purchased | 27,254 |  |  | 1,616 |  |  | — |  |  | 28,870 |
Write-offs | — |  |  | — |  |  | (21,144) |  |  | (21,144) |
Allowance for expected credit losses as of December 31, 2023 | 34,778 |  |  | 17,734 |  |  | 6,898 |  |  | 59,410 |
| Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Allowance for expected credit losses as of December 31, 2021 | 20,115 |  |  | 16,175 |  |  | 5,186 |  |  | 41,476 |
Transfer to lifetime expected credit losses | (29) |  |  | 29 |  |  | — |  |  | — |
Transfer to 12-month expected credit losses | 176 |  |  | (176) |  |  | — |  |  | — |
Transfer to credit-impaired financial instruments | (130) |  |  | — |  |  | 130 |  |  | — |
Net effect of changes in allowance for expected credit losses | (1,718) |  |  | (10,146) |  |  | 16,072 |  |  | 4,208 |
Financial instruments that have been derecognized during the year | (12,385) |  |  | (832) |  |  | — |  |  | (13,217) |
New instruments originated or purchased | 22,560 |  |  | — |  |  | — |  |  | 22,560 |
Write-offs | — |  |  | — |  |  | (893) |  |  | (893) |
Recoveries | — |  |  | — |  |  | 1,066 |  |  | 1,066 |
Allowance for expected credit losses as of December 31, 2022 | 28,589 |  |  | 5,050 |  |  | 21,561 |  |  | 55,200 |
A. Credit risk (continued) Loan commitments, financial guarantee contracts and customers’ liabilities under acceptances The allowance for expected credit losses on loan commitments and financial guarantee contracts reflects the Bank’s Management is estimate of expected credit losses of customers’ liabilities under acceptances and contingent liabilities such as: confirmed letters of credit, stand-by letters of credit, guarantees, and credit commitments.
| Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Allowance for expected credit losses as of December 31, 2022 | 3,605 |  |  | 23 |  |  | — |  |  | 3,628 |
Transfer to lifetime expected credit losses | (24) |  |  | 24 |  |  | — |  |  | — |
Transfer to 12-month expected credit losses | 22 |  |  | (22) |  |  | — |  |  | — |
Net effect of changes in reserve for expected credit losses | (58) |  |  | 21 |  |  | — |  |  | (37) |
Financial instruments that have been derecognized during the year | (2,824) |  |  | — |  |  | — |  |  | (2,824) |
New instruments originated or purchased | 3,184 |  |  | 1,108 |  |  | — |  |  | 4,292 |
Allowance for expected credit losses as of December 31, 2023 | 3,905 |  |  | 1,154 |  |  | — |  |  | 5,059 |
| Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Allowance for expected credit losses as of December 31, 2021 | 3,472 |  |  | 331 |  |  | — |  |  | 3,803 |
Transfer to 12-month expected credit losses | 133 |  |  | (133) |  |  | — |  |  | — |
Net effect of changes in reserve for expected credit losses | (160) |  |  | (39) |  |  | — |  |  | (199) |
Financial instruments that have been derecognized during the year | (2,981) |  |  | (136) |  |  | — |  |  | (3,117) |
New instruments originated or purchased | 3,141 |  |  | — |  |  | — |  |  | 3,141 |
Allowance for expected credit losses as of December 31, 2022 | 3,605 |  |  | 23 |  |  | — |  |  | 3,628 |
Securities at amortized cost
| Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Allowance for expected credit losses as of December 31, 2022 | 2,170 |  |  | 1,779 |  |  | 4,002 |  |  | 7,951 |
Transfer to lifetime expected credit losses | (46) |  |  | 46 |  |  | — |  |  | — |
Net effect of changes in allowance for expected credit losses | (58) |  |  | 547 |  |  | 1,252 |  |  | 1,741 |
Financial instruments that have been derecognized during the year | (1,074) |  |  | (218) |  |  | — |  |  | (1,292) |
New financial assets originated or purchased | 238 |  |  | — |  |  | — |  |  | 238 |
Writte-offs | — |  |  | (1,752) |  |  | (5,254) |  |  | (7,006) |
Allowance for expected credit losses as of December 31, 2023 | 1,230 |  |  | 402 |  |  | — |  |  | 1,632 |
A. Credit risk (continued)
| Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Allowance for expected credit losses as of December 31, 2021 | 1,790 |  |  | — |  |  | — |  |  | 1,790 |
Transfer to lifetime expected credit losses | (46) |  |  | 46 |  |  | — |  |  | — |
Transfer to credit-impaired financial instruments | (33) |  |  | — |  |  | 33 |  |  | — |
Net effect of changes in allowance for expected credit losses | (13) |  |  | 941 |  |  | 3,969 |  |  | 4,897 |
Financial instruments that have been derecognized during the year | (420) |  |  | — |  |  | — |  |  | (420) |
New financial assets originated or purchased | 892 |  |  | 792 |  |  | — |  |  | 1,684 |
Allowance for expected credit losses as of December 31, 2022 | 2,170 |  |  | 1,779 |  |  | 4,002 |  |  | 7,951 |
Securities at FVOCI
| Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Allowance for expected credit losses as of December 31, 2022 | 10 |  |  | — |  |  | — |  |  | 10 |
Financial instruments that have been derecognized during the year | (11) |  |  | — |  |  | — |  |  | (11) |
New financial assets originated or purchased | 2 |  |  | — |  |  | — |  |  | 2 |
Allowance for expected credit losses as of December 31, 2023 | 1 |  |  | — |  |  | — |  |  | 1 |
| Stage 1 |  | Stage 2 |  | Stage 3 |  | Total
Allowance for expected credit losses as of December 31, 2021 | 26 |  |  | — |  |  | — |  |  | 26 |
Financial instruments that have been derecognized during the year | (16) |  |  | — |  |  | — |  |  | (16) |
Allowance for expected credit losses as of December 31, 2022 | 10 |  |  | — |  |  | — |  |  | 10 |
The following table provides a reconciliation between: - Amounts shown in the previous tables reconciling opening and closing balances of loss allowance per class of financial instrument; and - The (reversal) provision for credit losses’ line item in the consolidated statement of profit or loss. A. Credit risk (continued)
|  | Loans at amortized cost |  | Loan commitments and financial guarantee contracts |  | Securities |  |
December 31, 2023 |  |  |  | At amortized cost |  | FVOCI |  | Total
Net effect of changes in allowance for expected credit losses |  | 15,313 |  |  | (37) |  |  | 1,741 |  |  | — |  |  | 17,017 |
Financial instruments that have been derecognized during the year |  | (18,829) |  |  | (2,824) |  |  | (1,292) |  |  | (11) |  |  | (22,956) |
New financial assets originated or purchased |  | 28,870 |  |  | 4,292 |  |  | 238 |  |  | 2 |  |  | 33,402 |
Total |  | 25,354 |  |  | 1,431 |  |  | 687 |  |  | (9) |  |  | 27,463 |
|  | Loans at amortized cost |  | Loan commitments and financial guarantee contracts |  | Securities |  |
December 31, 2022 |  |  |  | At amortized cost |  | FVOCI |  | Total
Net effect of changes in allowance for expected credit losses |  | 4,208 |  |  | (199) |  |  | 4,897 |  |  | — |  |  | 8,906 |
Financial instruments that have been derecognized during the year |  | (13,217) |  |  | (3,117) |  |  | (420) |  |  | (16) |  |  | (16,770) |
New financial assets originated or purchased |  | 22,560 |  |  | 3,141 |  |  | 1,684 |  |  | — |  |  | 27,385 |
Total |  | 13,551 |  |  | (175) |  |  | 6,161 |  |  | (16) |  |  | 19,521 |
|  | Loans at amortized cost |  | Loan commitments and financial guarantee contracts |  | Securities |  |
December 31, 2021 |  |  |  | At amortized cost |  | FVOCI |  | Total
Net effect of changes in allowance for expected credit losses |  | (2,477) |  |  | (54) |  |  | (20) |  |  | — |  |  | (2,551) |
Financial instruments that have been derecognized during the year |  | (14,715) |  |  | (1,948) |  |  | (193) |  |  | (17) |  |  | (16,873) |
New financial assets originated or purchased |  | 17,343 |  |  | 2,901 |  |  | 1,508 |  |  | — |  |  | 21,752 |
Total |  | 151 |  |  | 899 |  |  | 1,295 |  |  | (17) |  |  | 2,328 |
A. Credit risk (continued) v.Credit-impaired financial assets Financial instruments with credit-impaired are graded 8 to 10 in the Bank’s internal credit risk grading system. The following table sets out a reconciliation of changes in the carrying amount of the allowance for credit losses for credit-impaired financial assets:
| December 31,
| 2023 |  | 2022
Credit-impaired loans at beginning of year | 21,561 |  |  | 5,186 |
Classified as credit-impaired during the year | — |  |  | 130 |
Change in allowance for expected credit losses | 6,181 |  |  | 14,606 |
Write-offs | (21,144) |  |  | (893) |
Recoveries of amounts previously written off | — |  |  | 1,066 |
Interest income | 300 |  |  | 1,466 |
Credit-impaired loans at end of year | 6,898 |  |  | 21,561 |
| December 31, |  |  |  |
| 2023 |  | 2022
Investments at amortized cost with credit impairment at beginning of year | 4,002 |  |  | — |  |  |  |  |
Classified as credit-impaired during the year | — |  |  | 33 |  |  |  |  |
Change in allowance for expected credit losses | 1,249 |  |  | 3,717 |  |  |  |  |
Interest income | 3 |  |  | 252 |  |  |  |  |
Write-offs | (5,254) |  |  | — |  |  |  |  |
Investments at amortized cost with credit impairment at end of year | — |  |  | 4,002 |  |  |  |  |
A. Credit risk (continued) vi.Concentrations of credit risk The Bank monitors concentrations of credit risk by sector, industry and country. An analysis of concentrations of credit risk from loans, loan commitments, financial guarantees and securities is as follows. Concentration by sector and industry
| Loans at amortized cost |  | Loan commitments and financial guarantee contracts |  | Securities
|  |  | At amortized cost |  | FVOCI
| December 31, 2023 |  | December 31, 2022 |  | December 31, 2023 |  | December 31, 2022 |  | December 31, 2023 |  | December 31, 2022 |  | December 31, 2023 |  | December 31, 2022
Carrying amount - principal | 7,195,567 |  |  | 6,763,020 |  |  | 261,428 |  |  | 163,345 |  |  | 999,544 |  |  | 941,971 |  |  | 11,824 |  |  | 77,972 |
Amount committed/guaranteed | — |  |  | — |  |  | 1,063,706 |  |  | 779,374 |  |  | — |  |  | — |  |  | — |  |  | — |
Concentration by sector |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Corporations: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Private | 3,192,357 |  |  | 2,553,193 |  |  | 727,379 |  |  | 409,139 |  |  | 582,877 |  |  | 543,381 |  |  | — |  |  | 24,773 |
State-owned | 1,204,471 |  |  | 1,115,932 |  |  | 115,542 |  |  | 110,468 |  |  | 20,619 |  |  | 51,388 |  |  | — |  |  | — |
Financial institutions: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Private | 2,248,150 |  |  | 2,245,385 |  |  | 97,381 |  |  | 120,614 |  |  | 311,870 |  |  | 250,975 |  |  | — |  |  | — |
State-owned | 464,917 |  |  | 719,882 |  |  | 384,832 |  |  | 302,498 |  |  | 35,149 |  |  | 31,902 |  |  | 11,824 |  |  | 53,199 |
Sovereign | 85,672 |  |  | 128,628 |  |  | — |  |  | — |  |  | 49,029 |  |  | 64,325 |  |  | — |  |  | — |
Total | 7,195,567 |  |  | 6,763,020 |  |  | 1,325,134 |  |  | 942,719 |  |  | 999,544 |  |  | 941,971 |  |  | 11,824 |  |  | 77,972 |
Concentration by industry |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Financial institutions | 2,713,067 |  |  | 2,965,266 |  |  | 482,213 |  |  | 423,112 |  |  | 351,463 |  |  | 282,878 |  |  | 11,824 |  |  | 53,199 |
Manufacturing | 1,702,514 |  |  | 1,341,453 |  |  | 464,433 |  |  | 293,659 |  |  | 346,140 |  |  | 339,914 |  |  | — |  |  | 14,898 |
Oil and petroleum derived products | 1,330,526 |  |  | 1,244,491 |  |  | 106,518 |  |  | 104,426 |  |  | 95,144 |  |  | 77,553 |  |  | — |  |  | 9,875 |
Agricultural | 239,498 |  |  | 317,037 |  |  | 22,546 |  |  | 3,854 |  |  | — |  |  | — |  |  | — |  |  | — |
Services | 465,113 |  |  | 267,868 |  |  | 108,632 |  |  | 55,430 |  |  | 84,840 |  |  | 64,412 |  |  | — |  |  | — |
Mining | 328,415 |  |  | 150,707 |  |  | 26,329 |  |  | — |  |  | 9,690 |  |  | 24,381 |  |  | — |  |  | — |
Sovereign | 85,672 |  |  | 128,628 |  |  | — |  |  | — |  |  | 49,029 |  |  | 64,325 |  |  | — |  |  | — |
Other | 330,762 |  |  | 347,570 |  |  | 114,463 |  |  | 62,238 |  |  | 63,238 |  |  | 88,508 |  |  | — |  |  | — |
Total | 7,195,567 |  |  | 6,763,020 |  |  | 1,325,134 |  |  | 942,719 |  |  | 999,544 |  |  | 941,971 |  |  | 11,824 |  |  | 77,972 |
A. Credit risk (continued) Risk rating and concentration by country
| Loans at amortized cost |  | Loan commitments and financial guarantee contracts |  | Securities
|  |  | At amortized cost |  | FVOCI
| December 31, 2023 |  | December 31, 2022 |  | December 31, 2023 |  | December 31, 2022 |  | December 31, 2023 |  | December 31, 2022 |  | December 31, 2023 |  | December 31, 2022
Carrying amount - principal | 7,195,567 |  |  | 6,763,020 |  |  | 261,428 |  |  | 163,345 |  |  | 999,544 |  |  | 941,971 |  |  | 11,824 |  |  | 77,972 |
Amount committed/guaranteed | — |  |  | — |  |  | 1,063,706 |  |  | 779,374 |  |  | — |  |  | — |  |  | — |  |  | — |
Rating |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
1-4 | 2,893,562 |  |  | 2,864,685 |  |  | 621,339 |  |  | 336,519 |  |  | 913,524 |  |  | 736,139 |  |  | 11,824 |  |  | 77,972 |
5-6 | 3,918,848 |  |  | 3,696,527 |  |  | 443,791 |  |  | 301,031 |  |  | 86,020 |  |  | 200,837 |  |  | — |  |  | — |
7-8 | 373,050 |  |  | 191,701 |  |  | 260,004 |  |  | 305,169 |  |  | — |  |  | 4,995 |  |  | — |  |  | — |
10 | 10,107 |  |  | 10,107 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total | 7,195,567 |  |  | 6,763,020 |  |  | 1,325,134 |  |  | 942,719 |  |  | 999,544 |  |  | 941,971 |  |  | 11,824 |  |  | 77,972 |
Concentration by country |  |  |  |  |  |  |  |  |  |  |  |  |  |
Argentina | 52,264 |  |  | 55,598 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Australia | — |  |  | — |  |  | — |  |  | — |  |  | 4,803 |  |  | 9,628 |  |  | — |  |  | — |
Belgium | 14,223 |  |  | 25,362 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Bolivia | — |  |  | — |  |  | 4,270 |  |  | 3,759 |  |  | — |  |  | — |  |  | — |  |  | — |
Brazil | 1,008,633 |  |  | 980,205 |  |  | 83,932 |  |  | 54,907 |  |  | 31,009 |  |  | 69,501 |  |  | — |  |  | — |
Canada | 22,599 |  |  | — |  |  | 24,996 |  |  | — |  |  | 38,508 |  |  | 13,503 |  |  | — |  |  | — |
Chile | 454,885 |  |  | 416,714 |  |  | 16,423 |  |  | 44,846 |  |  | 79,495 |  |  | 112,586 |  |  | — |  |  | — |
Colombia | 938,897 |  |  | 702,409 |  |  | 67,545 |  |  | 54,333 |  |  | 23,837 |  |  | 54,484 |  |  | — |  |  | — |
Korea | — |  |  | — |  |  | — |  |  | — |  |  | 1,839 |  |  | — |  |  | — |  |  | — |
Costa Rica | 284,709 |  |  | 260,625 |  |  | 51,895 |  |  | 56,718 |  |  | 7,988 |  |  | 9,926 |  |  | — |  |  | — |
Denmark | — |  |  | — |  |  | — |  |  | 11,880 |  |  | — |  |  | — |  |  | — |  |  | — |
Dominican Republic | 637,199 |  |  | 579,918 |  |  | 157,986 |  |  | 27,534 |  |  | 4,705 |  |  | 4,828 |  |  | — |  |  | — |
Ecuador | 190,628 |  |  | 110,466 |  |  | 259,597 |  |  | 305,168 |  |  | — |  |  | — |  |  | — |  |  | — |
El Salvador | 82,500 |  |  | 30,032 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
France | 27,454 |  |  | 126,929 |  |  | 96,249 |  |  | 66,906 |  |  | — |  |  | — |  |  | — |  |  | — |
Germany | — |  |  | — |  |  | 15,000 |  |  | 10,000 |  |  | 14,750 |  |  | — |  |  | — |  |  | — |
Guatemala | 704,012 |  |  | 745,837 |  |  | 100,227 |  |  | 67,456 |  |  | — |  |  | — |  |  | — |  |  | — |
Honduras | 221,672 |  |  | 176,270 |  |  | 975 |  |  | 3,615 |  |  | — |  |  | — |  |  | — |  |  | — |
Hong Kong | 15,000 |  |  | 2,800 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Ireland | — |  |  | — |  |  | — |  |  | — |  |  | 14,976 |  |  | 9,579 |  |  | — |  |  | — |
Israel | — |  |  | — |  |  | — |  |  | — |  |  | 4,788 |  |  | 4,880 |  |  | — |  |  | — |
Italy | — |  |  | — |  |  | — |  |  | — |  |  | 14,660 |  |  | — |  |  | — |  |  | — |
Jamaica | 101,858 |  |  | 14,083 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Japan | 12,037 |  |  | 14,712 |  |  | — |  |  | — |  |  | 38,548 |  |  | 4,353 |  |  | — |  |  | — |
Luxembourg | 89,833 |  |  | 114,557 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Mexico | 838,495 |  |  | 823,028 |  |  | 83,561 |  |  | 69,080 |  |  | 62,229 |  |  | 100,870 |  |  | — |  |  | — |
Netherlands | — |  |  | — |  |  | 800 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Norway | — |  |  | — |  |  | — |  |  | — |  |  | 9,838 |  |  | — |  |  | — |  |  | — |
Panama | 374,364 |  |  | 533,452 |  |  | 29,301 |  |  | 19,240 |  |  | 33,977 |  |  | 29,065 |  |  | — |  |  | — |
Paraguay | 186,426 |  |  | 151,287 |  |  | 230 |  |  | 3,430 |  |  | — |  |  | — |  |  | — |  |  | — |
Peru | 536,236 |  |  | 478,998 |  |  | 223,460 |  |  | 114,941 |  |  | 30,635 |  |  | 60,575 |  |  | — |  |  | — |
Singapore | 145,807 |  |  | 152,208 |  |  | 7,057 |  |  | 24,333 |  |  | — |  |  | — |  |  | — |  |  | — |
Trinidad and Tobago | 132,783 |  |  | 128,846 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
United States of America | 74,139 |  |  | 53,463 |  |  | — |  |  | 3,349 |  |  | 539,727 |  |  | 458,193 |  |  | — |  |  | 43,464 |
United Kingdom | 37,314 |  |  | 51,221 |  |  | — |  |  | — |  |  | 43,232 |  |  | — |  |  | — |  |  | — |
Uruguay | 11,600 |  |  | 34,000 |  |  | 101,630 |  |  | 1,224 |  |  | — |  |  | — |  |  | — |  |  | — |
Multilateral | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 11,824 |  |  | 34,508 |
Total | 7,195,567 |  |  | 6,763,020 |  |  | 1,325,134 |  |  | 942,719 |  |  | 999,544 |  |  | 941,971 |  |  | 11,824 |  |  | 77,972 |
A. Credit risk (continued) vii.Offsetting financial assets and liabilities The following tables include financial assets and liabilities that are offset in the consolidated financial statement or subject to an enforceable master netting arrangement: a)Derivative financial instruments – assets
|  | December 31, 2023
|  | Gross amounts of assets |  | Gross amounts offset in the consolidated statement of financial position |  | Net amount of assets presented in the consolidated statement of financial position |  | Gross amounts not offset in the consolidated statement of financial position |  | Net amount
|  |  |  |  | Financial instruments |  | Cash collateral received |
Derivative financial instruments used for hedging |  | 157,267 |  |  | — |  |  | 157,267 |  |  | — |  |  | (152,111) |  |  | 5,156 |
Total |  | 157,267 |  |  | — |  |  | 157,267 |  |  | — |  |  | (152,111) |  |  | 5,156 |
|  | December 31, 2022
|  | Gross amounts of assets |  | Gross amounts offset in the consolidated statement of financial position |  | Net amount of assets presented in the consolidated statement of financial position |  | Gross amounts not offset in the consolidated statement of financial position |  | Net amount
|  |  |  |  | Financial instruments |  | Cash collateral received |
Derivative financial instruments used for hedging |  | 68,159 |  |  | — |  |  | 68,159 |  |  | — |  |  | (50,615) |  |  | 17,544 |
Total |  | 68,159 |  |  | — |  |  | 68,159 |  |  | — |  |  | (50,615) |  |  | 17,544 |
A. Credit risk (continued) b)Securities sold under repurchase agreements and derivative financial instruments – liabilities
|  | December 31, 2023
|  | Gross amounts of liabilities |  | Gross amounts offset in the consolidated statement of financial position |  | Net amount of assets presented in the consolidated statement of financial position |  | Gross amounts not offset in the consolidated statement of financial position |  | Net amount
|  |  |  |  | Financial instruments |  | Cash collateral received |
Securities sold under repurchase agreements at amortized cost |  | (310,197) |  |  | — |  |  | (310,197) |  |  | 342,271 |  |  | 8,087 |  |  | 40,161 |
Derivative financial instruments used for hedging at FVTPL |  | (40,613) |  |  | — |  |  | (40,613) |  |  | — |  |  | 34,297 |  |  | (6,316) |
Total |  | (350,810) |  |  | — |  |  | (350,810) |  |  | 342,271 |  |  | 42,384 |  |  | 33,845 |
|  | December 31, 2022
|  | Gross amounts of liabilities |  | Gross amounts offset in the consolidated statement of financial position |  | Net amount of assets presented in the consolidated statement of financial position |  | Gross amounts not offset in the consolidated statement of financial position |  | Net amount
|  |  |  |  | Financial instruments |  | Cash collateral received |
Securities sold under repurchase agreements at amortized cost |  | (300,498) |  |  | — |  |  | (300,498) |  |  | 791,956 |  |  | 22,947 |  |  | 514,405 |
Derivative financial instruments used for hedging at FVTPL |  | (33,761) |  |  | — |  |  | (33,761) |  |  | — |  |  | 17,702 |  |  | (16,059) |
Total |  | (334,259) |  |  | — |  |  | (334,259) |  |  | 791,956 |  |  | 40,649 |  |  | 498,346 |
Liquidity risk (continued) The following table details the Bank’s liquidity ratios:
| December 31,
| 2023 |  | 2022
At the end of the year | 205.8 | % |  | 167.5 | %
Year average | 177.2 | % |  | 132.6 | %
Maximum of the year | 357.0 | % |  | 276.9 | %
Minimun of the year | 111.5 | % |  | 81.2 | %
The following table includes the Bank’s liquid assets by country risk:
| December 31, 2023 |  | December 31, 2022
(in millions of USD dollars) | Cash and due from banks |  | Securities FVOCI |  | Total |  | Cash and due from banks |  | Securities FVOCI |  | Total
United States of America | 1,904 |  |  | — |  |  | 1,904 |  |  | 1,151 |  |  | 43 |  |  | 1,194 |
Latin America | 7 |  |  | — |  |  | 7 |  |  | 15 |  |  | — |  |  | 15 |
Other countries | 1 |  |  | — |  |  | 1 |  |  | — |  |  | — |  |  | — |
Multilateral | 75 |  |  | 12 |  |  | 87 |  |  | 25 |  |  | 35 |  |  | 60 |
Total | 1,987 |  |  | 12 |  |  | 1,999 |  |  | 1,191 |  |  | 78 |  |  | 1,269 |
The following table includes the Bank’s demand deposits from customers and its ratio to total deposits from customers:
| December 31,
| 2023 |  | 2022
(in millions of USD dollars) |  |  |
Demand and "overnight" deposits | 748 |  |  | 583 |
Demand and "overnight" deposits to total deposits | 17.0 | % |  | 18.3 | %
The liquidity requirements resulting from the Bank’s demand deposits from customers is satisfied by the Bank’s liquid assets as follows:
| December 31,
(in millions of USD dollars) | 2023 |  | 2022
Total liquid assets | 1,999 |  |  | 1,269 |
Total assets to total liabilities | 45.4 | % |  | 39.8 | %
Total liquid assets in the Federal Reserve of the United States of America | 94.3 | % |  | 90.2 | %
B. Liquidity risk (continued) Even though the average term of the Bank’s assets exceeds the average term of its liabilities, the associated liquidity risk is diminished by the short-term nature of a material portion of the loan portfolio, since the Bank is primarily engaged in financing foreign trade. The following table includes the carrying amount for the Bank’s loans and securities short-term portfolio with maturity within one year based on their original contractual term along with its average remaining term:
| December 31,
(in millions of USD dollars) | 2023 |  | 2022
Loan portfolio at amortized cost and investment portfolio less than/equal to 1 year according to its original terms | 4,087 |  |  | 4,008 |
Average term (days) | 197 |  | 200
The following table includes the carrying amount for the Bank’s loans and securities medium term portfolio with maturity over one year based on their original contractual terms along with their average remaining term:
| December 31,
(in millions of USD dollars) | 2023 |  | 2022
Loan portfolio at amortized cost and investment portfolio greater than/equal to 1 year according to its original terms | 4,119 |  |  | 3,775 |
Average term (days) | 1381 |  | 1367
B. Liquidity risk (continued) ii. Maturity analysis for financial liabilities and financial assets The following table details the future undiscounted cash flows of financial assets and liabilities grouped by their remaining maturity with respect to the contractual maturity:
|  | December 31, 2023
|  | Up to 3 months |  | 3 to 6 months |  | 6 months to 1 year |  | 1 to 5 years |  | More than 5 years |  | Gross inflows (outflows) |  | Carrying amount
Assets |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and due from banks |  | 2,048,021 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 2,048,021 |  |  | 2,047,452 |
Securities |  | 10,992 |  |  | 89,836 |  |  | 110,816 |  |  | 886,944 |  |  | 32,117 |  |  | 1,130,705 |  |  | 1,022,131 |
Loans |  | 1,935,474 |  |  | 1,775,280 |  |  | 1,524,298 |  |  | 2,580,310 |  |  | 243,491 |  |  | 8,058,853 |  |  | 7,220,520 |
Derivative financial instruments - assets |  | 2,510 |  |  | 5,783 |  |  | 54,983 |  |  | 90,516 |  |  | 3,473 |  |  | 157,265 |  |  | 157,267 |
Total |  | 3,996,997 |  |  | 1,870,899 |  |  | 1,690,097 |  |  | 3,557,770 |  |  | 279,081 |  |  | 11,394,844 |  |  | 10,447,370 |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |
Deposits |  | (3,270,253) |  |  | (536,751) |  |  | (606,002) |  |  | (90,194) |  |  | — |  |  | (4,503,200) |  |  | (4,451,025) |
Securities sold under repurchase agreements |  | (317,951) |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (317,951) |  |  | (310,197) |
Borrowings and debt |  | (856,466) |  |  | (746,314) |  |  | (989,680) |  |  | (2,167,620) |  |  | (59,762) |  |  | (4,819,842) |  |  | (4,401,205) |
Lease liabilities |  | (284) |  |  | (286) |  |  | (572) |  |  | (4,728) |  |  | (10,837) |  |  | (16,707) |  |  | (16,707) |
Derivative financial instruments - liabilities |  | (17,188) |  |  | (1,994) |  |  | (7,849) |  |  | (11,661) |  |  | (2,034) |  |  | (40,726) |  |  | (40,613) |
Total |  | (4,462,142) |  |  | (1,285,345) |  |  | (1,604,103) |  |  | (2,274,203) |  |  | (72,633) |  |  | (9,698,426) |  |  | (9,219,747) |
Subtotal net position |  | (465,145) |  |  | 585,554 |  |  | 85,994 |  |  | 1,283,567 |  |  | 206,448 |  |  | 1,696,418 |  |  | 1,227,623 |
Off-balance sheet contingencies |  |  |  |  |  |  |  |  |  |  |  |  |  |
Confirmed letters of credit |  | 264,603 |  |  | 64,100 |  |  | 345 |  |  | 16,560 |  |  | — |  |  | 345,608 |  |  |
Stand-by letters of credit and guarantees |  | 196,775 |  |  | 79,659 |  |  | 199,192 |  |  | 15,000 |  |  | — |  |  | 490,626 |  |  |
Credit commitments |  | 20,000 |  |  | 39,497 |  |  | 37,545 |  |  | 130,430 |  |  | — |  |  | 227,472 |  |  |
Total |  | 481,378 |  |  | 183,256 |  |  | 237,082 |  |  | 161,990 |  |  | — |  |  | 1,063,706 |  |  |
Total net position |  | (946,523) |  |  | 402,298 |  |  | (151,088) |  |  | 1,121,577 |  |  | 206,448 |  |  | 632,712 |  |  |
B. Liquidity risk (continued)
|  | December 31, 2022
|  | Up to 3 months |  | 3 to 6 months |  | 6 months to 1 year |  | 1 to 5 years |  | More than 5 years |  | Gross inflows (outflows) |  | Carrying amount
Assets |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and due from banks |  | 1,241,779 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 1,241,779 |  |  | 1,241,586 |
Securities |  | 129,983 |  |  | 105,789 |  |  | 98,345 |  |  | 744,996 |  |  | 10,293 |  |  | 1,089,406 |  |  | 1,023,632 |
Loans |  | 2,294,259 |  |  | 1,478,494 |  |  | 1,223,661 |  |  | 2,244,454 |  |  | 158,967 |  |  | 7,399,835 |  |  | 6,760,434 |
Derivative financial instruments - assets |  | 4,216 |  |  | 10,831 |  |  | 14,015 |  |  | 39,097 |  |  | — |  |  | 68,159 |  |  | 68,159 |
Total |  | 3,670,237 |  |  | 1,595,114 |  |  | 1,336,021 |  |  | 3,028,547 |  |  | 169,260 |  |  | 9,799,179 |  |  | 9,093,811 |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |
Deposits |  | (2,770,754) |  |  | (256,989) |  |  | (161,889) |  |  | (39,805) |  |  | — |  |  | (3,229,437) |  |  | (3,205,386) |
Securities sold under repurchase agreements |  | (53,418) |  |  | (64,513) |  |  | (55,144) |  |  | (138,286) |  |  | — |  |  | (311,361) |  |  | (300,498) |
Borrowings and debt |  | (776,584) |  |  | (895,531) |  |  | (934,288) |  |  | (2,212,704) |  |  | (41,523) |  |  | (4,860,630) |  |  | (4,464,389) |
Lease liabilities |  | (384) |  |  | (384) |  |  | (738) |  |  | (5,769) |  |  | (13,771) |  |  | (21,046) |  |  | (16,745) |
Derivative financial instruments - liabilities |  | (3,702) |  |  | (764) |  |  | (63) |  |  | (26,882) |  |  | (2,350) |  |  | (33,761) |  |  | (33,761) |
Total |  | (3,604,842) |  |  | (1,218,181) |  |  | (1,152,122) |  |  | (2,423,446) |  |  | (57,644) |  |  | (8,456,235) |  |  | (8,020,779) |
Subtotal net position |  | 65,395 |  |  | 376,933 |  |  | 183,899 |  |  | 605,101 |  |  | 111,616 |  |  | 1,342,944 |  |  | 1,073,032 |
Off-balance sheet contingencies |  |  |  |  |  |  |  |  |  |  |  |  |  |
Confirmed letters of credit |  | 166,367 |  |  | 117,398 |  |  | 21,024 |  |  | — |  |  | — |  |  | 304,789 |  |  |
Stand-by letters of credit and guarantees |  | 132,353 |  |  | 117,750 |  |  | 92,750 |  |  | 8,772 |  |  | — |  |  | 351,625 |  |  |
Credit commitments |  | — |  |  | 13,102 |  |  | 32,906 |  |  | 76,952 |  |  | — |  |  | 122,960 |  |  |
Total |  | 298,720 |  |  | 248,250 |  |  | 146,680 |  |  | 85,724 |  |  | — |  |  | 779,374 |  |  |
Total net position |  | (233,325) |  |  | 128,683 |  |  | 37,219 |  |  | 519,377 |  |  | 111,616 |  |  | 563,570 |  |  |
The amounts in the tables above have been compiled as follows:
Type of financial instrument |  | Basis on which amounts are compiled
Financial assets and liabilities |  | Undiscounted cash flows, which include estimated interest payments.
Issued financial guarantee contracts, and loan commitments |  | Earliest possible contractual maturity. For issued financial guarantee contracts, the maximum amount of the guarantee is allocated to the earliest period in which the guarantee could be called.
Derivative financial assets and financial liabilities |  | Contractual undiscounted cash flows. The amounts shown are the gross notional inflows and outflows for derivatives that simultaneously settle gross or net amounts.
B. Liquidity risk (continued) Future undiscounted cash flow presented in the table above on some financial assets and financial liabilities vary materially from contractual cash flows. The principal difference is that the undiscounted future cash flows of floating rate assets and liabilities are calculated using projected market rates. iii. Liquidity reserves As part of the management of liquidity risk arising from financial liabi lities, the Bank holds liquid assets comprising cash and cash equivalents. The following table sets out the components of the Banks’s liquidity reserves:
| December 31, 2023 |  | December 31, 2022
| Amount |  | Fair value |  | Amount |  | Fair value
Balances with Federal Reserve of the United States of America | 1,884,204 |  |  | 1,884,204 |  |  | 1,144,896 |  |  | 1,144,896 |
Cash and due from banks (1) | 102,864 |  |  | 102,864 |  |  | 46,040 |  |  | 46,040 |
Total | 1,987,068 |  |  | 1,987,068 |  |  | 1,190,936 |  |  | 1,190,936 |
(1)Excludes pledged deposits. iv. Financial assets available to support future funding The following table sets out the Bank’s financial assets available to support future funding:
| December 31, 2023 |  | December 31, 2022
| Pledged as collateral |  | Available as collateral |  | Pledged as collateral |  | Available as collateral
Cash and due from banks | 60,384 |  |  | 1,987,066 |  |  | 50,650 |  |  | 1,190,936 |
Notional of investment securities | 400,825 |  |  | 619,533 |  |  | 331,571 |  |  | 672,042 |
Loans at amortized cost | — |  |  | 7,195,567 |  |  | — |  |  | 6,763,020 |
Total | 461,209 |  |  | 9,802,166 |  |  | 382,221 |  |  | 8,625,998 |
The total financial assets recognized in the statement of financial position that had been pledged as collateral for liabilities as of December 31, 2023, and 2022, are shown in the table above. The nature of those financial assets is included in Note 5.A.ii C. Market risk The Bank manages market risk by considering the consolidated financial situation of the Bank. For the definition of market risk and information on how the Bank manages the market risks of non-trading portfolios, see Note 6. i. Interest rate risk The table below details the Bank's exposure based on interest rate repricing/maturity date for the notional amount of the interest bearing financial assets and liabilities on interest-bearing financial assets and liabili ties:
|  | December 31, 2023
|  | Up to 3 months |  | 3 to 6 months |  | 6 months to 1 year |  | 1 to 5 years |  | More than 5 years |  | Without interest rate risk |  | Total
Assets |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and due from banks |  | 2,044,103 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 3,349 |  |  | 2,047,452 |
Securities |  | 14,169 |  |  | 60,256 |  |  | 82,951 |  |  | 824,836 |  |  | 29,156 |  |  | — |  |  | 1,011,368 |
Loans |  | 4,292,324 |  |  | 1,699,301 |  |  | 915,143 |  |  | 280,005 |  |  | 8,794 |  |  | — |  |  | 7,195,567 |
Total |  | 6,350,596 |  |  | 1,759,557 |  |  | 998,094 |  |  | 1,104,841 |  |  | 37,950 |  |  | 3,349 |  |  | 10,254,387 |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |
Demand deposits and time deposits |  | (3,553,774) |  |  | (442,338) |  |  | (342,686) |  |  | (59,029) |  |  | — |  |  | (10,322) |  |  | (4,408,149) |
Securities sold under repurchase agreements |  | (310,197) |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (310,197) |
Borrowings and debt |  | (2,653,379) |  |  | (381,795) |  |  | (483,731) |  |  | (818,947) |  |  | (14,136) |  |  | — |  |  | (4,351,988) |
Total |  | (6,517,350) |  |  | (824,133) |  |  | (826,417) |  |  | (877,976) |  |  | (14,136) |  |  | (10,322) |  |  | (9,070,334) |
Net effect of derivative financial instruments held for interest risk management |  | (3,485) |  |  | 3,790 |  |  | 47,134 |  |  | 78,855 |  |  | 1,439 |  |  | — |  |  | 127,733 |
Total interest rate sensitivity |  | (170,239) |  |  | 939,214 |  |  | 218,811 |  |  | 305,720 |  |  | 25,253 |  |  | (6,973) |  |  | 1,311,786 |
C. Market risk (continued)
|  | December 31, 2022
|  | Up to 3 months |  | 3 to 6 months |  | 6 months to 1 year |  | 1 to 5 years |  | More than 5 years |  | Without interest rate risk |  | Total
Assets |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and due from banks |  | 1,233,700 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 7,886 |  |  | 1,241,586 |
Securities |  | 112,736 |  |  | 114,815 |  |  | 82,666 |  |  | 701,749 |  |  | 7,977 |  |  | — |  |  | 1,019,943 |
Loans |  | 2,956,268 |  |  | 2,531,067 |  |  | 1,007,343 |  |  | 240,949 |  |  | 27,393 |  |  | — |  |  | 6,763,020 |
Total |  | 4,302,704 |  |  | 2,645,882 |  |  | 1,090,009 |  |  | 942,698 |  |  | 35,370 |  |  | 7,886 |  |  | 9,024,549 |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |
Demand deposits and time deposits |  | (2,746,776) |  |  | (250,299) |  |  | (153,862) |  |  | (35,082) |  |  | — |  |  | (4,697) |  |  | (3,190,716) |
Securities sold under repurchase agreements |  | (52,164) |  |  | (62,968) |  |  | (53,740) |  |  | (131,626) |  |  | — |  |  | — |  |  | (300,498) |
Borrowings and debt |  | (1,354,457) |  |  | (953,503) |  |  | (1,083,543) |  |  | (999,151) |  |  | (25,857) |  |  | — |  |  | (4,416,511) |
Total |  | (4,153,397) |  |  | (1,266,770) |  |  | (1,291,145) |  |  | (1,165,859) |  |  | (25,857) |  |  | (4,697) |  |  | (7,907,725) |
Net effect of derivative financial instruments held for interest risk management |  | 476 |  |  | 41 |  |  | 2,145 |  |  | 12,215 |  |  | (2,350) |  |  | — |  |  | 12,527 |
Total interest rate sensitivity |  | 149,783 |  |  | 1,379,153 |  |  | (198,991) |  |  | (210,946) |  |  | 7,163 |  |  | 3,189 |  |  | 1,129,351 |
Management of interest rate risk is complemented by monitoring the sensitivity of the Bank’s financial assets and liabilities to various standard interest rate scenarios. Standard scenarios that are considered on a monthly basis include a 50bps, 100bps and 200 bps parallel fall or rise in all yield curves which are assessed based on market conditions. The Bank performs a sensitivity analysis to the most likely increase or decrease in market interest rates at the reporting date, assuming no asymmetric movements in yield curves and a constant financial position to assess the effect on profit or loss. Interest rate sensitivity analysis affect reported equity in the following ways: - Retained earnings: increases or decreases in net interest income and in fair values of derivatives reported in profit or loss; - Fair value reserve: increases or decreases in fair values of financial assets at FVOCI reported directly in equity; and - Hedging reserve: increases or decreases in fair values of hedging instruments designated in qualifying cash flow hedge relationships. This sensitivity provides an analysis of changes in interest rates, considering the previous year´s interest rate volatility. C. Market risk (continued) Additionally, the Bank measures the sensitivity of the equity value (EVE) following the methodology described by the Basel Committee on Banking Supervision, which measures the interest rate risk embedded in the equity value, which for interest rate risk purposes is defined as the difference between the net present value of assets less the net present value of liabilities due, based on the impact of a change in interest rates on such present values. The following table presents the sensitivity analysis performed for the Bank:
| Change in interest rate |  | Effect on profit or loss |  | Effect on equity |  | Effect on equity value (EVE)
December 31, 2023 | +50 bps |  | 1,669 |  |  | 3,881 |  |  | (9,047) |
| -50 bps |  | (1,786) |  |  | (2,861) |  |  | 9,199 |
December 31, 2022 | +50 bps |  | 4,559 |  |  | 2,904 |  |  | 676 |
| -50 bps |  | (4,629) |  |  | (1,808) |  |  | (206) |
ii. Foreign exchange risk The following table presents the maximum exposure amount in foreign currency of the Bank’s carrying amount of total assets and liabilities, except for hedging relationships.
| December 31, 2023
| Brazilian real |  | European euro |  | Japanese yen |  | Colombian peso |  | Mexican peso |  | Other currencies(1) |  | Total
Exchange rate | 4.85 |  |  | 1.10 |  |  | 141.00 |  |  | 3,875.97 |  |  | 16.98 |  |  |  |  |
Assets |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and due from banks | 10 |  |  | 387 |  |  | 45 |  |  | 35 |  |  | 1,314 |  |  | 14 |  |  | 1,805 |
Loans | — |  |  | 30,360 |  |  | — |  |  | — |  |  | 304,529 |  |  | — |  |  | 334,889 |
Total | 10 |  |  | 30,747 |  |  | 45 |  |  | 35 |  |  | 305,843 |  |  | 14 |  |  | 336,694 |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |  |
Borrowings and debt | — |  |  | (30,360) |  |  | — |  |  | — |  |  | (305,631) |  |  | — |  |  | (335,991) |
Total | — |  |  | (30,360) |  |  | — |  |  | — |  |  | (305,631) |  |  | — |  |  | (335,991) |
Net currency position | 10 |  |  | 387 |  |  | 45 |  |  | 35 |  |  | 212 |  |  | 14 |  |  | 703 |
C. Market risk (continued)
| December 31, 2022
| Brazilian real |  | European euro |  | Japanese yen |  | Colombian peso |  | Mexican peso |  | Other currencies(1) |  | Total
Exchange rate | 5.29 |  |  | 1.07 |  |  | 130.96 |  |  | 4,854.37 |  |  | 19.50 |  |  |  |  |
Assets |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and due from banks | 26 |  |  | 53 |  |  | 4 |  |  | 9 |  |  | 5,439 |  |  | 38 |  |  | 5,569 |
Loans | — |  |  | — |  |  | — |  |  | — |  |  | 301,765 |  |  | — |  |  | 301,765 |
Total | 26 |  |  | 53 |  |  | 4 |  |  | 9 |  |  | 307,204 |  |  | 38 |  |  | 307,334 |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |  |
Borrowings and debt | — |  |  | — |  |  | — |  |  | — |  |  | (306,603) |  |  | — |  |  | (306,603) |
Total | — |  |  | — |  |  | — |  |  | — |  |  | (306,603) |  |  | — |  |  | (306,603) |
Net currency position | 26 |  |  | 53 |  |  | 4 |  |  | 9 |  |  | 601 |  |  | 38 |  |  | 731 |
(1)It includes other currencies such as: Argentine pesos, Australian dollar, Swiss franc, Sterling pound and Peruvian soles.

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