...www.fitchratings.com February 9, 2016 Chilean Banks' 2015 Results Fell 11% by Higher Corporates Taxes Year-end results benefited from recurring operating income from costumers and good asset quality, counterbalancing the persistent economic slowdown, higher corporate taxes, local currency devaluation and lower inflation rate. However, the Chilean banking system¦s profitability has been resilient through the economic cycles, which is likely to continue. Net Interest Margin Decreasing Chilean banks have ample earning assets denominated in inflation-linked units (Unidad de Fomento [UF]), which makes interest margins highly correlated to inflation trends. The inflation rate in 2015 was 4.4%, compared with 4.7% in 2014. Earning assets' base increase was also related to the recent acquisition of the Banco de Credito Inversiones' (BCI) foreign subsidiary and mortgage loan growth, which are highly affected by inflation rate. Fitch expects operating ROAA in 2016 could continue to be eroded by a...
