BCH Down 1.35% Daily Amid Weak Loan Growth and Earnings Pressures

On NOV 14 2025, BCH dropped by 1.35% within 24 hours to reach $501.2, BCH dropped by 0.22% within 7 days, dropped by 6.11% within 1 month, and rose by 15.63% within 1 year.

Morningstar highlighted concerns over Banco de Chile’s earnings performance, attributing the slowdown to reduced inflation adjustment income and weak loan growth. The bank operates under three distinct brand names—Banco de Chile, Banco Edwards-Citi, and Banco CrediChile—and is the second-largest lender in the country by loans and third-largest by deposits. Nearly 60% of its revenue is derived from net interest income, primarily from mortgage, unsecured consumer credit lines, and commercial loans. A significant portion of its outstanding loans—25%—are directed to firms with more than 10,000 million CLP in annual revenue.

Goldman Sachs recently reaffirmed its Neutral recommendation for BCH, citing a modest 0.70% upside based on the average one-year price target of $36.93 per share. Analysts project a range from $36.54 to $38.04. Institutional ownership data reflects a mixed landscape. The number of funds or institutions holding BCH increased by 12.75% in the last quarter, with an average portfolio weight of 0.13%. However, total institutional shares held decreased by 3.53% to 14.6 million. The put/call ratio stands at 4.11, signaling a bearish outlook among traders.

Several large institutional investors altered their positions. Bridge Builder International Equity Fund increased its holdings by 14.87% and boosted its portfolio allocation by 23.75%. In contrast, Renaissance Technologies reduced its stake by 5.10% and its portfolio allocation by 3.96%. Baillie Gifford significantly trimmed its exposure, with a 289.93% reduction in shares held and a 91.16% decrease in portfolio allocation.

Backtest Hypothesis

A backtesting strategy has been developed to evaluate the performance of Banco de Chile (BCH.N) around its earnings release dates since 2022. The backtest uses close prices and evaluates performance over a 30-trading-day window following announcements. The event set includes only two earnings announcements—February 3, 2025, and July 31, 2025—due to data limitations for earlier periods.

Key observations show that the average cumulative excess return turned positive after approximately 10 trading days, peaking near +11% versus the benchmark by day 29. However, the positive performance was largely driven by a single event, underscoring the limited statistical power of the two-observation dataset. Analysts caution that results are indicative, and further data or alternative parameters—such as shorter windows or surprise metrics—could provide more robust insights.