Banco Latinoamericano's Q1 2025: Unraveling Contradictions in Fee Income, Net Interest Margins, and Business Strategy

Fee income growth expectations, net interest margin outlook, letters of credit business expectations are the key contradictions discussed in Banco Latinoamericano de Comercio Exterior's latest 2025Q1 earnings call.



Strong Financial Performance:
- Bladex reported a net income of $51.7 million for Q1 2025, in line with both the previous quarter and the same period last year.
- This was supported by strong top-line performance, resilient fee income, and contain [credit provisions].

Asset Growth and Diversification:
- The company's total loan portfolio reached $10.7 billion, reflecting a 6.5% increase quarter over quarter and 23% increase year over year.
- Growth was driven by strong performance in Argentina, Mexico, and Guatemala, with asset quality remaining pristine.

Deposit and Funding Expansion:
- Deposits rose to $5.9 billion, up 8% quarter over quarter and 24% year over year, representing almost 60% of total funding.
- This positive trend reflects strong client engagement and the success of the Yankee CD program.

Fee Income and Off-Balance Sheet Growth:
- Fee income totaled $10.6 million, up 12% year over year, with particular strength in the letters of credit business.
- This growth was driven by successful cross-selling initiatives and increased demand from high-grade names in the oil and gas sector.

Liquidity and Capital Management:
- Bladex maintained a strong liquidity position with $1.9 billion of liquid assets, representing 15% of total assets.
- The capital ratio remained strong, with a total capital increase to $1.37 billion, supporting a quarterly dividend of $0.625 per share.