Group 1: BanColombia (CIB) - BanColombia is the largest bank in terms of assets and has the largest market participation in deposit products and loans [1] - The Zacks Consensus Estimate for its current year earnings has increased by 4% over the last 60 days [1] - The company has a dividend yield of 12.4%, significantly higher than the industry average of 3.3% [1] Group 2: Intercorp Financial Services (IFS) - Intercorp Financial Services provides financial products and services [2] - The Zacks Consensus Estimate for its current year earnings has increased by 2.6% over the last 60 days [2] - The company has a dividend yield of 2.5%, compared to the industry average of 0.0% [2] Group 3: Seven and I Holdings Co. (SVNDY) - Seven and I Holdings is a Japan-based holding company focusing on seven business areas including convenience stores and financial services [3] - The Zacks Consensus Estimate for its current year earnings has increased by 18.5% over the last 60 days [3] - The company has a dividend yield of 1.2%, compared to the industry average of 0.0% [3]

Group 1 - Grupo Cibest (CIB) shares increased by 5.5% to close at $44.97, with trading volume significantly higher than usual, compared to a 2.5% gain over the past four weeks [1][2] - The rise in CIB's share price is attributed to reduced geopolitical tensions in the Middle East following President Trump's intervention, which has boosted investor confidence in global stock markets [2] - CIB is expected to report quarterly earnings of $1.63 per share, reflecting a year-over-year increase of 13.2%, with revenues projected at $1.83 billion, up 3% from the previous year [3] Group 2 - The consensus EPS estimate for CIB has remained unchanged over the last 30 days, indicating that stock price movements may not sustain without trends in earnings estimate revisions [4] - CIB currently holds a Zacks Rank of 3 (Hold), indicating a neutral outlook [5] - KBC Group, a peer in the same industry, has a consensus EPS estimate of $1.34, representing a year-over-year change of 10.7%, and also holds a Zacks Rank of 3 (Hold) [6]

Group 1 - Bancolombia has rebranded itself as "Grupo Cibest" and is a bank holding company based in Colombia [1] - The company is the direct owner of several banks, including Bancolombia (the largest bank in Colombia), Bancoagricola (the largest bank in El Salvador), Banistmo (the second-largest bank in Panama), and BAM [1]

Core Viewpoint - Bancolombia (CIB) has been upgraded to a Zacks Rank 2 (Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system emphasizes the importance of changing earnings estimates in determining stock price movements, with a strong correlation between earnings estimate revisions and near-term stock performance [4][6]. - Rising earnings estimates for Bancolombia indicate an improvement in the company's underlying business, suggesting that investors may respond positively by driving the stock price higher [5][10]. Zacks Rating System - The Zacks Rank stock-rating system categorizes stocks into five groups based on earnings estimates, with a proven track record of Zacks Rank 1 stocks generating an average annual return of +25% since 1988 [7]. - The upgrade of Bancolombia to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, indicating a strong potential for market-beating returns in the near term [9][10]. Earnings Estimate Revisions for Bancolombia - For the fiscal year ending December 2025, Bancolombia is expected to earn $6.30 per share, which remains unchanged from the previous year, while the Zacks Consensus Estimate has increased by 1.4% over the past three months [8].

Core Viewpoint - Investors in the Banks - Foreign sector should consider Bancolombia (CIB) and Banco Itau (ITUB) for potential undervalued stock opportunities [1] Group 1: Zacks Rank and Earnings Outlook - Bancolombia has a Zacks Rank of 2 (Buy), indicating a positive earnings outlook, while Banco Itau has a Zacks Rank of 3 (Hold) [3] - The Zacks Rank emphasizes companies with positive earnings estimate revisions, suggesting that CIB is likely experiencing a more favorable earnings outlook [3] Group 2: Valuation Metrics - CIB has a forward P/E ratio of 6.55, significantly lower than ITUB's forward P/E of 9.53, indicating that CIB may be undervalued [5] - CIB's PEG ratio is 0.92, while ITUB's PEG ratio is 1.17, suggesting that CIB's stock is expected to grow at a better rate relative to its price [5] - CIB's P/B ratio is 1.19 compared to ITUB's P/B of 1.99, further supporting the notion that CIB is undervalued [6] Group 3: Value Grades - CIB has earned a Value grade of A, while ITUB has a Value grade of D, indicating a stronger valuation profile for CIB [6] - The combination of Zacks Rank and Style Scores suggests that value investors may prefer CIB over ITUB at this time [6]

Core Viewpoint - The article emphasizes the importance of value investing and highlights BanColombia (CIB) as a strong value stock based on various financial metrics [2][8]. Company Overview - BanColombia (CIB) currently holds a Zacks Rank of 2 (Buy) and has a Value grade of A [4]. - The stock is trading with a P/E ratio of 6.63, significantly lower than its industry's average of 9.46 [4]. - CIB's Forward P/E has fluctuated between 5.05 and 7.19 over the past year, with a median of 5.51 [4]. Valuation Metrics - CIB has a P/B ratio of 1.22, which is favorable compared to the industry's average P/B of 2.28 [5]. - The P/S ratio for CIB is 0.98, while the industry's average P/S is 1.55, indicating a potential undervaluation [6]. - CIB's P/CF ratio stands at 7.71, compared to the industry's average of 16.13, suggesting strong cash flow relative to its market value [7]. Investment Potential - The various valuation metrics indicate that BanColombia is likely undervalued at present, making it an attractive option for value investors [8].

Financial Data and Key Metrics Changes - The quarterly net income reached COP 1.7 trillion, reflecting a 4.5% growth both quarterly and annually [6][28] - The return on equity (ROE) for the quarter was 16.3%, with a return on tangible equity of 20.4% [29] - The loan portfolio decreased slightly this quarter but grew 7% annually [6][20] - Deposits fell by 1% in the quarter yet increased almost 13% annually [7][21] - The cost of risk for the period was 1.6%, showing improved asset quality [7][26] Business Line Data and Key Metrics Changes - The retail segment saw an increase in market share in savings accounts and time deposits by 110 basis points as of February 2025 [16] - NEKI's deposits experienced a significant growth of 70% year over year [17] - Credit card loans market share increased by 20 basis points, representing nearly 30% of transaction value [17] Market Data and Key Metrics Changes - The Colombian economy showed signs of recovery with increased investment and domestic demand despite global trade tensions [5] - Inflation rates remained stable, leading to unchanged interest rates [5] - The exchange rate depreciated up to 8% during March, impacting local assets [12] Company Strategy and Development Direction - The merger of Bancolombia ALA MANO with NEKI aims to enhance financial inclusion and meet evolving technological needs [14] - The company is transitioning to Grupo Cypest, allowing for more value distribution, including an extraordinary dividend [8] - A share buyback program is planned for approval at an upcoming extraordinary shareholders meeting [9] Management's Comments on Operating Environment and Future Outlook - Management expects GDP growth of 2.6% for 2025, with a slight increase to 3% in 2026 [11] - The fiscal situation in Colombia is a significant challenge, with a projected fiscal deficit of 5.9% of GDP [54] - The company remains cautious regarding the cost of risk due to macroeconomic uncertainties [70] Other Important Information - The company plans to release consolidated results for the second quarter on August 6, including a new accounting structure [9] - The efficiency ratio fell to 49.6%, indicating improved operational efficiency [28] Q&A Session Summary Question: Regarding personal expenses tracking above inflation - Management explained that the increase in personal expenses is due to higher provisions for bonuses compared to the previous year, which were lower due to lower net income expectations [40][41] Question: On margin optimization and funding costs - Management acknowledged the competitive environment for funding but expressed confidence in maintaining margins through effective cost management strategies [36][37] Question: Thoughts on political and economic outlook in Colombia - Management indicated that the fiscal situation is a significant challenge and emphasized the need for the new government to address it [52][54] Question: ROE targets for subsidiaries - Management provided ROE targets, expecting Banco Agricola in El Salvador to exceed 20%, Banismo in Panama to exceed 10%, and BAM to reach around 14-15% [58][59] Question: Impact of lower oil prices on GDP and fiscal forecasts - Management maintained the GDP growth forecast of 2.6% but acknowledged that lower oil prices could impact fiscal revenues and expenditures [68] Question: Guidance on provisions and growth expectations - Management confirmed that provisions are expected to remain prudent despite positive asset quality trends, with specific growth rates projected for different loan segments [82]

Financial Data and Key Metrics Changes - The quarterly net income reached COP 1.7 trillion, reflecting a 4.5% growth both quarterly and annually [5][29] - The return on equity (ROE) for the quarter was 16.3%, with a return on tangible equity of 20.4% [30] - The loan portfolio decreased slightly this quarter but grew 7% annually [5][21] - Deposits fell by 1% in the quarter yet increased almost 13% annually [6][22] - The cost of risk for the period was 1.6%, showing improved asset quality [6][27] Business Line Data and Key Metrics Changes - The retail segment saw an increase in market share in savings accounts and time deposits by 110 basis points as of February 2025 [16] - NEKI's deposits experienced a significant growth of 70% year over year [18] - Credit card loans market share increased by 20 basis points, representing nearly 30% of transaction value [18] Market Data and Key Metrics Changes - The Colombian economy showed signs of recovery with increased investment and domestic demand despite global trade tensions [4] - Inflation rates remained stable, leading to unchanged interest rates during the quarter [4] - The exchange rate depreciated up to 8% during March, impacting local assets [12] Company Strategy and Development Direction - The merger of Bancolombia ALA MANO with NEKI aims to enhance financial inclusion and meet evolving technological needs [14] - The company plans to distribute an extraordinary dividend of $6.24 per share, resulting in a total dividend payout of 69% for the year [7] - A share buyback program is planned for approval at an upcoming extraordinary shareholders meeting [8] Management's Comments on Operating Environment and Future Outlook - Management maintains a GDP growth expectation of 2.6% for 2025, with a slight increase to 3% in 2026 [11] - The fiscal situation in Colombia is viewed as a significant challenge, with a projected fiscal deficit of 5.9% of GDP [51][53] - The company remains cautious regarding the cost of risk due to macroeconomic uncertainties [69] Other Important Information - The company achieved a total solvency ratio of nearly 13% and a core equity Tier one ratio of 11.2% [7][30] - The transition to the Mibanco Columbia App has enhanced customer experience, with 8.5 million users migrated [8] Q&A Session Summary Question: Regarding personal expenses and bonus line tracking above inflation - Management explained that the first quarter's higher provisions for bonuses were due to improved net income expectations compared to the previous year [39] Question: On margins and funding optimization - Management acknowledged the competitive environment for funding but expressed confidence in maintaining net interest margin (NIM) guidance of around 6.2% [37][38] Question: Political and economic outlook in Colombia - Management indicated that the fiscal situation is a key challenge, with expectations for a clearer political landscape by the end of the year [50][51] Question: ROE targets among subsidiaries - Management provided ROE targets of above 20% for Banco Agricola in El Salvador, above 10% for Banismo in Panama, and around 14-15% for BAM in Guatemala [57][59] Question: Impact of lower oil prices on GDP and fiscal forecast - Management maintained the GDP growth expectation of 2.6% but acknowledged potential revisions due to lower oil prices impacting fiscal revenues [66] Question: Provisions and growth relationship - Management confirmed guidance for commercial loans growing at 4%, mortgage loans at 4.5%, and consumer loans at 8% [83]

Earnings Results 1Q25 1Q25 Overview Financial Highlights • Net income COP 1.7 trillion and NIM 6.4% Credit Risk Other Highlights • ROE 16.3% ; ROTE 20.4% • Loan book down -0.3% QoQ and up 7.0% YoY • Deposits down -1.1% QoQ and up 12.8% YoY • Basel III CET1 Capital Ratio of 11.16% and Total Capital Ratio of 12.91% • Net provision charges amounted to 1.1 trillion up 18.3% QoQ equivalent to a quarterly annualized CoR of 1.6% • 90 days PDLs Coverage ratio of 162.5% • Allowances represent 5.2% of total loans • S ...

Group 1 - The bank has received regulatory non-objection for the proposal to reorganize its corporate structure, indicating that the implementation is imminent [1] - The shareholder meeting was described as busy, suggesting active engagement and decision-making among stakeholders [1] Group 2 - The article reflects a long-term investment perspective, emphasizing the importance of knowledge compounding and strategic thinking in investment [1]