products and credit cards, whose higher spreads feed the
net interest income.
Fee income stood at €805m, practically flat to
September 2008, despite lower volumes, above all in
credit cards. Net trading income rose significantly over
the year, going up 14.1% to reach €310m year to date
by the end of September 2009. As indicated in earlier
quarters, this rise is especially positive as it is referenced
against the same period of 2008, which included the
proceeds of the VISA IPO. The insurance and
pension-fund businesses also contributed sound
earnings. Gross income rose 4.8% to reach €3,722m
during the first nine months of the year.
Various efficiency plans implemented to improve
management and contain costs helped to maintain
operating expenses at the same level as the previous
year. With the rise in gross income mentioned above,
this meant that the cost-income ratio hit a new record,
ending September at 31.1%. This was 27 basis points
lower than in the second quarter of 2009. With positive
revenue and cost performance, the year-to-date
operating income for the nine months was €2,564m,
with a year-on-year increase of 7.1%.
Impairment losses on financial assets stood at
€1,097m year to date. This 68.7% year-on-year rise is
lower than in previous quarters. The percentage of the
operating income used to absorb these losses is also
continuing to drop. In the third quarter, it was 42.2%,
as against 43.1% in 2Q09. This is one of the lowest
percentages within the Mexican banking industry.
The area’s performance and administration was thus
proven to be up to the circumstances, enabling it to
record a positive net attributable profit from January to
September 2009 of €1,101m despite the difficult
environment for the country as a whole.
Banking business
Bancomer’s positive performance compares favourably
against its peers in the main indicators for asset quality,
thanks to its well focussed risk management.
During the third quarter of 2009, Moody’s confirmed
its C+ rating of Bancomer’s financial strength. This
ratifies the bank’s reputation for robustness and
leadership in the Mexican market, even during troubled
times.
Bancomer’s lending activity maintained a very similar
loan-book at 30-Sept-09 to what it had the previous
year: €26,550m. However, the loan-book mix has
changed substantially, as the consumer portfolio
continues to lose share. It now accounts for 22% of
total gross customer lending, as compared with the
26% share it had in September 2008. It reflects a
13.1% drop over the period. This is the outcome of
low business volumes which reflect both the general
economic downturn and the strict lending standards
and the selective acceptance policy applied to
customers.
Its portfolio of loans to small and medium-sized
enterprises (SMEs) was the most dynamic, growing
24.6% year on year, driven by Bancomer’s strategies to
boost lending this year. During the third quarter, the
area implemented a successful programme to provide
small businesses with liquidity. Bancomer placed €93m
through this programme and restructured a further
€61m, benefitting more than 6,000 SMEs. Bancomer
has continued to provide a line of liquidity to larger
companies too (in keeping with their current repayment
capacities). Its programme to support business with
credit has had 220 beneficiaries, companies borrowing
more than €263m to ensure their operations can run
without financial pressure and avoid deterioration of
their sales activities. Bancomer also reinforced its
leadership position in government lending during the
third quarter of this year. It granted a total of €557m in
credit to monetarise the resources of the FEIEF (a
federated fund for revenue stabilisation). This sum will
be drawn down gradually over time.
Through its Investment & Corporate Banking unit,
Bancomer helped corporations to increase liquidity,
participating in 20 debt issues and 5 syndicated loan
facilities during the third quarter. For the fourth quarter
running, the bank has headed the ranking tables, with
28.3% and 31.6% of the total volume placed in the
market during 3Q09, according to Bloomberg and
Thomson Financial, respectively.
Its mortgage book maintained a year-on-year growth of
9.5%. At the end of September, it stood at €8,521m.
Bancomer maintains its leadership in new mortgages,
3Q09 BUSINESS AREAS
Mexico
41
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