UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

 

FORM 6-K

 

REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934

 

For the month of May, 2016

 

Comission File Number 001-32535

 

Bancolombia S.A.

(Translation of registrant’s name into English)

 

Cra. 48 # 26-85
Medellín, Colombia
(Address of principal executive offices)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F þ                    Form 40-F ¨

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):___

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(2):___

 

Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes o                    No þ

 

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-                    .

  

 

 

  

 

 

BANCOLOMBIA S.A. (NYSE: CIB; BVC: BCOLOMBIA, PFBCOLOM) REPORTS CONSOLIDATED NET INCOME OF 397 BILLION FOR THE FIRST QUARTER OF 2016

 

·Net loan portfolio grew 21.0% compared to 1Q15. This annual growth is explained by organic net loan growth, the depreciation of the peso, and by the incorporation of BAM’s loan portfolio in 2015, which explains 6.4% of the total growth. During the quarter, the peso appreciated versus the dollar and this caused the contraction of the loan portfolio on a consolidated level.

 

·Net interest income grew 29.9% compared to 1Q15. This growth is explained by sustained growth in the loan portfolio and by an improving net interest margin, which increased from 5.6% in 1Q15 to 5.7% in 1Q16.

 

·Net fees increased by 18.9% compared to 1Q15. This solid growth was mainly driven by an increase in fees related to banking services, electronic services, credit and debit cards, distribution of insurance products through the bank’s network, brokerage, and international wire transfers.

 

·Net provisions increased 16.7% during the last quarter but were offset by the solid growth in net interest income. This increase in provisions is explained by specific defaults related to a few corporate clients and to some deterioration in the consumer segment.

 

·Income tax increased 113% compared to 1Q15. This jump is explained by the inter quarterly exchange rate fluctuations experienced last year, that create differences between financial accounting and tax accounting, which in turn made the effective tax rate 56% in 1Q16.

 

May 23, 2016. Medellin, Colombia – Today, BANCOLOMBIA S.A. (“Bancolombia” or “the Bank”) announced its earnings results for the first quarter of 20161. For the quarter ended on March 31, 2016 (“1Q16”), Bancolombia reported consolidated net income of COP 397 billion, or COP 408.3 per share - USD 0.54 per ADR. This net income represents a 39.5% decrease compared to the quarter ended on December 31, 2015 (“4Q15”) and a 37.1% decrease compared to the quarter ended on March 31, 2015 (“1Q15”).

 

All data, results, and analyses shown in this report, treat Tuya S.A. as a discontinued operation. For this reason, Bancolombia does not consolidate this operation in its consolidated financial statements and makes reference to it through a separate line on its Balance Sheet and Income Statement.

 

 

1. This report corresponds to the interim unaudited consolidated financial statements of BANCOLOMBIA S.A. and its subsidiaries (“BANCOLOMBIA” or “The Bank”) which Bancolombia controls, amongst others, by owning directly or indirectly, more than 50% of the voting capital stock. These financial statements have been prepared in accordance with International Financial Reporting Standards – IFRS. BANCOLOMBIA maintains accounting records in Colombian pesos, referred to herein as “Ps.” or “COP”. The statements of income for the quarter ended March 31, 2016 are not necessarily indicative of the results for any other future interim period. For more information, please refer to the Bank's filings with the Securities and Exchange Commission, which are available on the Commission's website at www.sec.gov. CAUTIONARY NOTE REGARDING CHANGES IN THE BANK’S ACCOUNTING POLICIES: Until 2014, BANCOLOMBIA prepared its financial statements under the rules issued by Superintendencia Financiera de Colombia (Colombian GAAP). Beginning on January 1, 2015, the financial statements of BANCOLOMBIA are being prepared under IFRS. BANCOLOMBIA’s first IFRS financial statements will cover the year ending in 2015 and will also include the comparative financial statements for the year ending in 2014. Until Bancolombia prepares the first annual consolidated financial statements under IFRS and definitively establishes its IFRS accounting policies in accordance with the IFRS 1, the interim unaudited consolidated financial information for interim periods within 2015 may be further amended.

CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS: This release contains statements that may be considered forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934. All forward-looking statements, whether made in this release or in future filings or press releases or orally, address matters that involve risks and uncertainties; consequently, there are or will be factors, including, among others, changes in general economic and business conditions, changes in currency exchange rates and interest rates, introduction of competing products by other companies, lack of acceptances of new products or services by our targeted customers, changes in business strategy and various others factors, that could cause actual results to differ materially from those indicated in such statements. We do not intend, and do not assume any obligation, to update these forward-looking statements. Certain monetary amounts, percentages and other figures included in this report have been subject to rounding adjustments. Any reference to BANCOLOMBIA means the Bank together with its affiliates, unless otherwise specified.

Representative Market Rate, April 1, 2016 $3,000.63 = US$ 1

 

  1

 

 

 

BANCOLOMBIA: Summary of consolidated financial quarterly results

 

CONSOLIDATED BALANCE SHEET                    
AND INCOME STATEMENT      Quarter       Growth 
(COP millions)  1Q15   4Q15   1Q16   1Q16/4Q15   1Q16/1Q15 
ASSETS                         
Net Loans   115,192,159    140,371,884    139,432,678    -0.67%   21.04%
Investments   13,368,676    14,277,824    15,040,851    5.34%   12.51%
Other assets   27,942,323    38,323,159    36,911,252    -3.68%   32.10%
Total assets   156,503,158    192,972,867    191,384,781    -0.82%   22.29%
                          
LIABILITIES AND SHAREHOLDERS' EQUITY                         
Deposits   97,896,958    122,202,090    117,399,796    -3.93%   19.92%
Other liabilities   40,972,271    50,362,858    54,200,764    7.62%   32.29%
Total liabilities   138,869,229    172,564,948    171,600,560    -0.56%   23.57%
Non-controlling interest   475,154    1,128,470    1,100,018    -2.52%   131.51%
Shareholders' equity   17,158,775    19,279,449    18,684,203    -3.09%   8.89%
Total liabilities and shareholders' equity   156,503,158    192,972,867    191,384,781    -0.82%   22.29%
                          
Interest income   2,662,836    3,088,030    3,679,988    19.17%   38.20%
Interest expense   (884,718)   (1,165,072)   (1,369,008)   17.50%   54.74%
Net interest income   1,778,118    1,922,958    2,310,980    20.18%   29.97%
Net provsions   (299,631)   (459,596)   (536,553)   16.74%   79.07%
Fees and income from service, net   465,982    505,699    553,949    9.54%   18.88%
Other operating income   358,968    377,671    388,392    2.84%   8.20%
Total Dividends received and equity method   53,897    96,388    63,840    -33.77%   18.45%
Total operating expense   (1,454,564)   (1,626,499)   (1,801,484)   10.76%   23.85%
Profit before tax   902,770    816,621    979,124    19.90%   8.46%
Income tax   (258,266)   (98,904)   (550,848)   456.95%   113.29%
Net income before non-controlling interest   644,504    717,717    428,276    -40.33%   -33.55%
Non-controlling interest   (23,918)   (45,752)   (35,555)   -22.29%   48.65%
Net income before Descontinued Operations   620,586    671,965    392,721    -41.56%   -36.72%
Discontinued Operations Net Income   11,315    (15,613)   4,645    -129.75%   -58.95%
Net income   631,901    656,352    397,366    -39.46%   -37.12%

 

PRINCIPAL RATIOS  1Q 15  

Quarter

4Q 15

   1Q 16 
PROFITABILITY               
Net interest margin (1) from continuing operations   5.58%   5.11%   5.68%
Return on average total assets (2) from continuing operations   1.64%   1.51%   0.81%
Return on average shareholders' equity (3)   14.22%   13.83%   8.10%
EFFICIENCY               
Operating expenses to net operating income   54.75%   56.04%   54.31%
Operating expenses to average total assets   3.85%   3.66%   3.73%
Operating expenses to products assets   4.55%   4.32%   4.43%
CAPITAL ADEQUACY               
Shareholders' equity to total assets   11.14%   9.99%   9.76%
Technical capital to risk weighted assets   14.21%   12.46%   12.96%
KEY FINANCIAL HIGHLIGHTS               
Net income per ADS from continuing operations   0.98    0.89    0.54 
Net income per share $COP from continuing operations   645.22    698.63    408.31 
P/BV ADS (4)   1.41    1.05    1.28 
P/BV Local (5) (6)   1.35    1.05    1.27 
P/E (7) from continuing operations   9.68    7.52    15.18 
ADR price   39.33    26.75    33.18 
Common share price (8)   24,500    20,980    24,700 
Weighted average of Preferred Shares outstanding   961,827,000    961,827,000    961,827,000 
USD exchange rate (quarter end)   2,598.36    3,149.47    3,000.63 

 

(1) Defined as net interest income divided by monthly average interest-earning assets. (2) Net income divided by monthly average assets. (3) Net income divided by monthly average shareholders' equity. (4) Defined as ADS price divided by ADS book value. (5) Defined as share price divided by share book value. (6) Share prices on the Colombian Stock Exchange. (7) Defined as market capitalization divided by annualized quarter results. (8) Prices at the end of the respective quarter.

 

  2

 

 

 

 

1.BALANCE SHEET

 

1.1.Assets

 

As of March 31, 2016, Bancolombia’s assets totaled COP 191,385 billion, which represents a decrease of 0.8% compared to 4Q15 and an increase of 22.3% compared to 1Q15. In the quarter, the decrease in assets was explained by a reduction in the repurchase agreement operations position. The consolidation of BAM at the end of 2015 explains 7.3% of the total asset’s annual growth (33% of marginal growth).

 

During the quarter the COP appreciated 4.7% versus the USD and depreciated 15.5% over the past 12 months. The decrease in total assets is largely explained by the reduced value of assets denominated in dollars that represent less pesos when converted and also to a reduction in the position of reverse purchase agreements.

 

1.2.Loan Portfolio

 

The following table shows the composition of Bancolombia’s investments and loans by type and currency:

 

(COP Million)  Amounts in COP   Amounts in USD converted to COP   Amounts in USD (thousands)   Total 
(1 USD = 3000.63 COP)  1Q16   1Q16/4Q15   1Q16   1Q16/4Q15   1Q16   1Q16/4Q15   1Q16   1Q16/4Q15 
Commercial loans   64,038,297    3.80%   40,184,504    -5.82%   13,392,022    -1.15%   104,222,799    -0.13%
Consumer loans   12,818,376    1.10%   8,386,406    -3.74%   2,794,882    1.03%   21,204,782    -0.87%
Mortgage loans   10,439,344    -2.81%   8,064,182    -2.14%   2,687,496    2.71%   18,503,948    -2.52%
Small  business loans   612,426    3.31%   312,639    5.50%   104,191    10.74%   925,065    4.04%
Interests paid in advance   (21,747)   2405.40%   -    -100.00%   -    -100.00%   (21,747)   2405.41%
Gross loans   87,886,696    2.55%   56,947,731    -4.95%   18,978,592    -0.24%   144,834,847    -0.54%

 

The quarter 1Q16 shows a decrease in gross loans of 0.5%, in general the segments during this quarter presented a slight decrease caused by less credit demand and the appreciation of the COP versus the USD during the quarter, as was expected during the year, except for small business loans that grew 4.0%. Also, in comparison with a year ago, total gross loans grew 20.6%. The consolidation of BAM at the end of 2015 explains 6.4% of the gross loans annual growth (31% of marginal growth).    

 

Gross loans denominated in currencies different from COP product of our operation in El Salvador, Panama and Guatemala accounted for 39.3% at the end of 1Q16.

 

Total reserves (allowances in the balance sheet) for loan losses increased by 2.9% during 1Q16 and totaled COP 5,402 billion, equivalent to 3.7% of gross loans at the end of the quarter.

 

For further explanation regarding coverage of the loan portfolio and credit quality trends, (see section 2.4. Asset Quality, Provision Charges and Balance Sheet Strength).

 

The following table summarizes Bancolombia’s total loan portfolio:

 

LOAN PORTFOLIO                        
(COP million)  1Q15   4Q 15   1Q16   1Q16/4Q15   1Q16/1Q15   % of total loans 
Commercial   84,853,593    104,359,215    104,222,799    -0.13%   22.83%   72.0%
Consumer   19,633,257    21,391,494    21,204,782    -0.87%   8.00%   14.6%
Mortgage   14,976,934    18,981,641    18,503,948    -2.52%   23.55%   12.8%
Microcredit   703,731    889,157    925,065    4.04%   31.45%   0.6%
Interests received in advance   (31,363)   (868)   (21,747)   2405.41%   -30.66%   0.0%
Total loan portfolio   120,136,152    145,620,639    144,834,847    -0.54%   20.56%   100.0%
Allowance for loan losses   (4,943,993)   (5,248,755)   (5,402,169)   2.92%   9.27%     
Total loans, net   115,192,159    140,371,884    139,432,678    -0.67%   21.04%     

 

1.3.Investment Portfolio

 

As of March 31, 2016, Bancolombia’s net investment portfolio totaled COP 15,041 billion, increasing 5.3% compared to the figure reported in 4Q15 and growing 12.5% compared to 1Q15. This quarterly increase is explained by the bank's strategy of increasing its time deposits and investing its excess of cash in liquid assets. The investment portfolio consists primarily of debt securities, which represent 71.0% of Bancolombia’s total investments and 5.6% of assets at the end of 1Q16.

 

  3

 

 

 

At the end of 1Q16, the investments in debt securities had a duration of 17.1 months and a yield to maturity of 6.76%.

 

1.4.Goodwill and intangibles

 

As of 1Q16, Bancolombia’s goodwill and intangibles totaled COP 6,676 billion, decreasing 5.9% compared to 4Q15. This variation is explained by the appreciation of the COP against the USD during the quarter.

 

1.5.Funding

 

As of March 31, 2016, Bancolombia’s liabilities totaled COP 171,601 billion, decreasing 0.9% with respect to 4Q15 and increasing 23.6% compared to 1Q15. Of this annual growth, 7.35% (31% of marginal variation) is explained by the incorporation of BAM.

 

Deposits by customers totaled COP 116,806 billion (or 68.1% of liabilities) at the end of 1Q16, decreasing 4.1% during the quarter and increasing 20.3% over the last 12 months. The net loans to deposits ratio (including borrowings from domestic development banks) was 114% at the end of 1Q16, which marks an increase in comparison to the 110% reported in 4Q15, and the 113% reported in 1Q15.

 

Bancolombia’s funding strategy during the quarter focused on taking deposits prematurely in order to assure the necessary liquidity for the upcoming months. The objective is to build and maintain ample liquidity on the balance sheet. This strategy, added to the Central Bank’s rate hikes, increased the cost of deposits during the quarter.

 

Funding mix   1 Q15    4 Q15    1 Q16 
COP Million                              
Checking accounts   17,649,725    13%   23,646,578    15%   21,894,531    14%
Saving accounts   38,667,767    30%   47,813,680    29%   46,863,823    29%
Time deposits   39,470,983    29%   48,713,789    30%   46,788,999    29%
Other deposits   5,099,439    4%   2,860,437    2%   5,023,147    3%
Long term debt   15,400,833    12%   19,435,865    12%   18,586,652    12%
Loans with banks   15,509,665    12%   20,121,246    12%   20,441,690    13%
Total Funds   130,755,085    100%   162,591,595    100%   159,598,842    100%

  

1.6.Shareholders’ Equity and Regulatory Capital

 

Shareholders’ equity at the end of 1Q16 was COP 18,684 billion, decreasing 3.1% or COP 595 billion, with respect to the COP 19,279 billion reported at the end of 4Q15.

 

Bancolombia’s capital adequacy ratio was 13.0% in 1Q16. This figure highlights the company’s solid capital position.

 

Bancolombia’s capital adequacy ratio was 400 basis points above the minimum 9% required by the Colombian regulator, while the basic capital ratio (Tier 1) to risk weighted assets was 8.20%, 370 basis points above the regulatory minimum of 4.5%. The tangible capital ratio, defined as shareholders’ equity minus goodwill and intangible assets divided by tangible assets, was 6.37% at the end of 1Q16.

 

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TECHNICAL CAPITAL RISK WEIGHTED ASSETS                        
Consolidated (COP millions)  1Q15   %   4Q15   %   1Q16   % 
Basic capital (Tier I)   11,367,295    8.57%   12,552,622    7.51%   13,741,047    8.20%
Additional capital (Tier II)   7,487,984    5.64%   8,268,887    4.95%   7,985,639    4.76%
Technical capital (1)   18,855,278         20,821,509         21,726,686      
Risk weighted assets included market risk   132,687,996         167,168,400         167,605,948      
CAPITAL ADEQUACY (2)   14.21%             12.46%        12.96%

 

(1) Technical capital is the sum of basic and additional capital.

(2) Capital adequacy is technical capital divided by risk weighted assets.

 

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2.INCOME STATEMENT

 

Net income totaled COP 397 billion in 1Q16, or COP 408.3 per share - USD 0.54 per ADR (excluding discontinued operations). This net income represents a decrease of 39.5% compared to 4Q15 and of 37.1% compared to 1Q15. This drop in net income was impacted by higher income taxes. Bancolombia’s annualized ROE for 1Q16 was 8.1%.

 

2.1.Net Interest Income

 

Net interest income totaled COP 2,311 billion in 1Q16, 20.2% more than that reported in 4Q15, and 30.0% higher than the figure for 1Q15. The positive annual performance of this line was driven by higher volumes in loans and the depreciation of the COP versus the USD. Of this annual increase in revenue, BAM explains 7.11% (24% of marginal variation). The quarterly performance can be explained by improvement in the net interest margin.

 

During 1Q16, the investment, interest rate derivatives and repos portfolio generated COP 184 billion.

 

Net Interest Margin

 

The annualized net interest margin increased to 5.7% in 1Q16. The annualized net interest margin for investments was 3.0%, higher than the -0.5% of 4Q15 and the annualized net interest margin of the loan portfolio was 5.9%, which is higher than the 5.6% in 4Q15.

 

Annualized Interest            
Margin  1Q15   4Q15   1Q16 
Loans' Interest margin   6.0%   5.6%   5.9%
Debt investments' margin   0.9%   -0.5%   3.0%
Net interest margin   5.6%   5.1%   5.7%

 

 

The funding cost increased during 1Q16 due to the increase in the reference rate of the Colombian Central Bank. Savings and checking accounts remained the same as a proportion of the total cost of funding presented last quarter, and the annualized average weighted cost of deposits was 2.79% in 1Q16, increasing 32 basis points compared to 4Q15.

 

Average weighted            
funding cost  1Q15   4Q15   1Q16 
Checking accounts   0.00%   0.00%   0.00%
Saving accounts   1.34%   1.63%   1.77%
Time deposits   4.11%   4.41%   5.13%
Total deposits   2.18%   2.47%   2.79%
Long term debt   6.28%   6.36%   7.18%
Loans with banks   2.27%   2.37%   2.54%
Total funding cost   2.67%   2.92%   3.27%

 

2.2.Fees and Income from Services

 

During 1Q16, net fees and income from services totaled COP 554 billion, increasing 9.5% with respect to 4Q15 and 18.9% with respect to 1Q15. Fees from credit and debit cards increased 8.1% compared to 4Q15 due to lower costs related to loyalty programs, and they marked a 6.6% increase compared to 1Q15, explained by transaction volumes. Fees from asset management and trust services increased 5.7% compared to 4Q15 and 9.0% compared to 1Q15. Fees from our bancassurance business decreased 7.4% compared to 4Q15, due largely to seasonal variations, but grew 34.7% in respect to 1Q15, thanks to the successful cross-selling initiatives led by our sales teams.

 

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The following table summarizes Bancolombia’s participation in the credit card business in Colombia:

 

ACCUMULATED CREDIT CARD BILLING          %   2016 
(COP millions)  Jan-15   Jan-16   Growth   Market Share 
Bancolombia VISA   264,671    332,687    25.70%   8.55%
Bancolombia Mastercard   308,378    350,110    13.53%   9.00%
Bancolombia American Express   317,525    290,044    -8.65%   7.46%
Total Bancolombia   890,573    972,840    9.24%   25.01%
Colombian Credit Card Market   3,494,657    3,890,522    11.33%     

 

CREDIT CARD MARKET SHARE          %   2016 
(Outstanding credit cards)  Jan-15   Jan-16   Growth   Market Share 
Bancolombia VISA   504,113    607,820    20.57%   5.62%
Bancolombia Mastercard   654,604    751,309    14.77%   6.95%
Bancolombia American Express   710,206    644,792    -9.21%   5.96%
Total Bancolombia   1,868,923    2,003,921    7.22%   18.53%
Colombian Credit Card Market   9,963,573    10,817,230    8.57%     

 

Source: Superintendencia Financiera de Colombia

 

2.3.Other Operating Income

 

Total other operating income was COP 388 billion in 1Q16, growing by 2.8% compared to 4Q15, and by 8.2% with respect to 1Q15.

 

Revenues aggregated in the operating leases line totaled COP 117 billion in 1Q16, decreasing by 6.2% compared to 4Q15 and increased by 14.5% compared to those reported in 1Q15.

 

2.4.Asset Quality, Provision Charges and Balance Sheet Strength

 

The capital balance for past due loans (those that are overdue for more than 30 days) totaled COP 4,646 billion at the end of 1Q16 and represented 3.3% of total gross loans, showing a slight increase compared to 4Q15. Charge-offs totaled COP 352 billion in 1Q16.

 

The coverage, measured by the ratio of allowances for loans losses (principal) to PDLs (overdue 30 days), was 106.2% at the end of 1Q16, decreasing compared to 115.2% in 4Q15. Likewise, the coverage measured by the ratio of allowances for loans losses to loans classified as C, D and E, was 86.0% at the end of 1Q16, decreasing with respect to the 87.0% reported in 4Q15.

 

The deterioration of the loan portfolio (new past due loans including charge-offs) was COP 810 billion in 1Q16, which represented 0.6% of the loan portfolio at the beginning of the quarter.

 

Provision charges (net of recoveries) totaled COP 537 billion in 1Q16. Provisions as a percentage of the average gross loans were 1.5% for 1Q16.

 

Bancolombia maintains a strong balance sheet supported on an adequate level of loan loss reserves. Allowances for loan losses (only reserves for the principal of loans) totaled COP 4,934 billion, or 3.5% of total loans at the end of 1Q16. This proportion is slightly higher than the 3.4% presented at the end of 4Q15.

 

  7

 

  

 

The following tables present key metrics related to asset quality:

 

ASSET QUALITY  As of 
(COP millions)  1Q15   4Q15   1Q16 
Total 30-day past due loans   3,578,656    4,188,287    4,645,700 
Allowance for loan losses (1)   4,409,115    4,823,393    4,934,311 
Past due loans to total loans   3.11%   2.98%   3.33%
“C”, “D” and “E” loans as a percentage of total loans   3.73%   3.95%   4.11%
Allowances to past due loans   123.21%   115.16%   106.21%
Allowance for loan  losses as a percentage of “C”, “D” and “E” loans   102.69%   87.00%   85.95%
Allowance for loan losses as a percentage of total loans   3.83%   3.43%   3.54%

 

(1) Allowances are reserves for the principal of loans.

 

PDL Per Category          30 days 
   % Of loan Portfolio   1Q15   4Q15   1Q16 
Commercial loans   72.4%   1.9%   2.08%   2.39%
Consumer loans   14.7%   4.8%   4.74%   4.83%
Microcredit   0.6%   8.3%   7.59%   8.40%
Mortgage loans   12.2%   6.6%   6.03%   6.83%
PDL TOTAL        3.1%   2.98%   3.33%

 

PDL Per Category          90 days 
   % Of loan Portfolio   1Q15   4Q15   1Q16 
Commercial loans   72.4%   1.4%   1.33%   1.67%
Consumer loans   14.7%   2.2%   3.06%   3.07%
Microcredit   0.6%   5.1%   5.05%   5.18%
Mortgage loans*   12.2%   3.0%   2.81%   2.62%
PDL TOTAL        1.7%   1.79%   2.01%

 

* Mortgage loans that were overdue were calculated for past due loans for 120 days instead of 90 days.

 

LOANS AND FINANCIAL LEASES CLASSIFICATION   1 Q15      4 Q15   1 Q16 
(COP millions)                              
¨A¨ Normal   104,210,390    90.55%   127,370,372    90.65%   125,295,403    89.80%
¨B¨ Subnormal   6,579,396    5.72%   7,585,730    5.40%   8,504,797    6.09%
¨C¨ Deficient   2,033,253    1.77%   2,366,866    1.68%   2,524,384    1.81%
¨D¨ Doubtful recovery   1,319,315    1.15%   1,684,517    1.20%   1,626,057    1.17%
¨E¨ Unrecoverable   940,997    0.81%   1,492,441    1.07%   1,590,147    1.13%
Total   115,083,351    100.00%   140,499,927    100.00%   139,540,789    100.00%
Loans and financial leases classified as C, D and E as a percentage of total loans and financial leases   3.73%        3.95%        4.11%     

 

2.5.Operating Expenses

 

During 1Q16, operating expenses totaled COP 1,801 billion, increasing 10.8% with respect to 4Q15 and increasing 23.9% with respect to 1Q15. Of this annual increase in personnel expenses, BAM explains 10.6% (45% of the marginal increase).

 

Personnel expenses (salaries, bonus plan payments and compensation) totaled COP 698 billion in 1Q16, increasing 19.7% compared to 4Q15 and 33.5% compared to 1Q15. Of this annual growth in personnel expenses, BAM explains 8.0% (24% of the marginal increase).

 

During 1Q16, administrative expenses totaled COP 597 billion, decreasing 10.4% compared to 4Q15 and increasing 23.7% as compared to 1Q15. Of this annual growth in administrative expenses, BAM explains 15.4% (67% of the marginal increase).

 

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Depreciation and amortization expenses totaled COP 155 billion in 1Q16, increasing 16.3% compared to 4Q15 and 33.5% compared to 1Q15.

 

In 4Q15, the tax on wealth was reclassified under “Operating expenses”.

 

As of March 31, 2016, Bancolombia had 34,511 employees, owned 1,276 branches, 5,080 ATMs, and served 11 million customers.

 

2.6.Taxes

 

The income tax was COP 551 billion, which represented a 113% increase compared to the income tax paid in 1Q15. In 2015, the re-expression of USD denominated liabilities created a lower income tax base, which made the effective tax rate in 1Q15 and in general throughout the year significantly lower than the statutory tax rate.

 

On the other hand, in 1Q16 the COP appreciated versus the USD and this made the income tax base greater, therefore directly impacting the effective tax rate, which was naturally higher. Following this idea, the fluctuations in the FX rate USD/COP increased the differences between tax accounting and financial accounting and caused taxes to increase significantly in 2016 compared to 2015.

 

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3.RECENT DEVELOPMENTS

 

·March 16, 2016, the General Shareholders’ Assembly, (“Bancolombia”) approved a dividend equal to COP $888.12 per each common or preferred share, in each case issued and outstanding, to be paid as follows: COP $222.03 per share and per quarter on: April 1st, 2016, July 1st, 2016, October 3, 2016 and January 2, 2017.

 

·March 16, 2016, the General Shareholders’ Assembly of Bancolombia appointed the following persons to the Board of Directors of the Bank from April 2016 to March 2018:

 

David Bojanini García

Gonzalo Alberto Pérez Rojas

Hernando José Gómez Restrepo

Roberto Ricardo Steiner Sampedro

Luis Fernando Restrepo Echavarría

Arturo Condo Tamayo

Andrés Felipe Mejía Cardona

 

The following members: Hernando José Gómez Restrepo, Roberto Ricardo Steiner Sampedro, Luis Fernando Restrepo Echavarría, Arturo Condo Tamayo and Andres Felipe Mejía Cardona act as independent directors. Accordingly, independent directors represent 71% of the Board of Directors of Bancolombia.

 

·March 7, 2016, Carlos Raul Yepes Jimenez officially informed the Board about his decision to resign as CEO of Bancolombia, a position he has held since February 2011.

 

At an extraordinary meeting, the Board of Directors of Bancolombia, once understanding the reasons for the resignation of Carlos Raul recognizes the important effort that he has led for five years at the helm of the organization that now has presence in 10 countries and that has also implemented a new style of banking. His charisma, inspiring leadership and commitment are essential so that today Bancolombia obtains excellent financial results, generating shared value and is also recognized as the most reputable company in Colombia.

 

Likewise Directors, unanimously, have appointed Juan Carlos Mora Uribe, former Vice President of Innovation and Digital Transformation, as the new CEO of the Organization. Juan Carlos Mora Uribe holds a business degree from Universidad EAFIT, an MBA from Babson College (USA), and during his twenty-five years in the organization has held various positions as Vice President of Administrative Affairs, Chief Risk Officer and Chief Operating Officer.

 

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4.BANCOLOMBIA Company Description (NYSE: CIB)

 

GRUPO BANCOLOMBIA is a full service financial conglomerate incorporated in Colombia that offers a wide range of banking products and services to a diversified individual and corporate customer base of more than 11 million customers. GRUPO BANCOLOMBIA delivers its products and services via its regional network comprised of: Colombia’s largest non-government owned banking network, El Salvador’s leading financial conglomerate (Banagricola S.A.), off-shore and local (Banistmo S.A.) banking subsidiaries in Panama, Guatemala, Cayman and Puerto Rico. Together, BANCOLOMBIA and its subsidiaries provide stock brokerage, investment banking, leasing, factoring, consumer finance, fiduciary and trust services, asset management, among others.

 

Contact Information

 

Bancolombia’s Investor Relations

Phone: (574) 4041837 / (574) 4041838 / (574) 4043917.

E-mail: IR@bancolombia.com.co

Alejandro Mejia (IR Manager) / Camilo Arbelaez (Analyst) / Juliana Álvarez (Analyst)

Website: http://www.grupobancolombia.com/wps/portal/about-us/corporate-information/investor-relations/

 

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BALANCE SHEET              Growth         
(COP million)  Mar-15   Dec-15   Mar-16   Mar- 16 /
Dec-15		   Mar-16 /
Mar-15		   % of
Assets		   % of
Liabilities		 
ASSETS                                   
Cash and balances at central bank   11,082,550    14,295,163    14,577,824    1.98%   31.54%   7.62%     
Interbank borrowings   1,524,439    999,220    1,504,929    50.61%   -1.28%   0.79%     
Reverse repurchase agreements   942,245    3,303,231    1,148,346    -65.24%   21.87%   0.60%     
Investments   13,368,676    14,277,824    15,040,851    5.34%   12.51%   7.86%     
Derivative financial instruments - Assets   1,618,568    2,382,168    2,350,871    -1.31%   45.24%   1.23%     
Loans and advances to customers   120,136,152    145,620,639    144,834,847    -0.54%   20.56%   75.68%     
Allowance for loan and lease losses   (4,943,993)   (5,248,755)   (5,402,169)   2.92%   9.27%   -2.82%     
Investment in associates and joint ventures   1,209,209    546,549    531,794    -2.70%   -56.02%   0.28%     
Goodwill and Intangible assets   4,944,577    7,092,255    6,676,098    -5.87%   35.02%   3.49%     
Premises and equipment   2,611,313    3,241,562    3,151,168    -2.79%   20.67%   1.65%     
Investment property   1,138,332    1,505,046    1,548,778    2.91%   36.06%   0.81%     
Prepayments   221,882    292,416    256,196    -12.39%   15.46%   0.13%     
Tax receivables   374,387    899,485    704,181    -21.71%   88.09%   0.37%     
Deferred tax   560,960    170,482    648,981    280.67%   15.69%   0.34%     
Assets held for sale   87,828    1,950,808    2,144,757    9.94%   2342.00%   1.12%     
Other assets   1,626,033    1,644,774    1,667,329    1.37%   2.54%   0.87%     
Total assets   156,503,158    192,972,867    191,384,781    -1.14%   22.29%   100.00%     
LIABILITIES AND SHAREHOLDERS' EQUITY                                   
LIABILITIES                                   
Deposit by customers   97,088,853    121,802,028    116,805,706    -4.10%   20.31%   61.03%   68.07%
Interbank Deposits   808,105    400,062    594,090    48.50%   -26.48%   0.31%   0.35%
Derivative financial instrument - Liabilities   1,557,450    1,930,609    1,990,850    3.12%   27.83%   1.04%   1.16%
Borrowings from other financial institutions   14,701,560    19,721,184    19,847,600    0.64%   35.00%   10.37%   11.57%
Debt securities in issue   15,400,833    19,435,865    18,586,652    -4.37%   20.69%   9.71%   10.83%
Preferred shares   537,335    580,959    538,348    -7.33%   0.19%   0.28%   0.31%
Repurchase agreements   3,015,558    1,232,456    3,764,794    205.47%   24.85%   1.97%   2.19%
Tax liabilities   256,052    193,949    594,371    206.46%   132.13%   0.31%   0.35%
Deferred tax liabilities   725,412    834,392    1,389,287    66.50%   91.52%   0.73%   0.81%
Employee pension plan   128,611    546,422    130,643    -76.09%   1.58%   0.07%   0.08%
Liabilities relating to assets held for sale   -    1,605,133    1,845,726    14.99%   0.00%   0.96%   1.08%
Other liabilities   4,649,460    4,281,889    5,512,493    28.74%   18.56%   2.88%   3.21%
Total liabilities   138,869,229    172,564,948    171,600,560    -0.92%   23.57%   89.66%   100.00%
SHAREHOLDERS' EQUITY                                   
Capital   480,914    480,914    480,914    0.00%   0.00%   0.00%     
Additional paid-in-capital   4,857,454    4,857,454    4,857,454    0.00%   0.00%   0.00%     
Appropriate reserves   6,026,569    5,877,379    7,097,545    20.76%   14.55%   17.77%     
Retained earnings   5,052,260    5,850,588    4,231,297    -27.68%   3.24%   -16.25%     
Cumulative other comprehensive income   741,578    2,213,114    2,016,993    -8.86%   200.84%   171.99%     
Stockholders’ equity attributable the owners of the parent company   17,158,775    19,279,449    18,684,203    -3.09%   8.89%   9.76%     
Non-controlling interest   475,154    1,128,470    1,100,018    -2.52%   131.51%   0.57%     
Total liabilities and stockholders' equity   156,503,158    192,972,867    191,384,781    -1.14%   22.29%   100.00%     

 

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INCOME STATEMENT              Growth 
(COP million)  1Q 15   4Q 15   1Q 16   1Q16 / 4Q15   1Q16 / 1Q15 
Interest income and expenses                         
Interest on loans                         
Commercial   1,252,998    1,524,846    1,824,372    19.64%   45.60%
Consumer   558,658    619,699    675,884    9.07%   20.98%
Small business loans   42,826    50,489    54,921    8.78%   28.24%
Mortgage   323,203    398,620    487,771    22.36%   50.92%
Leasing   376,458    414,122    446,753    7.88%   18.67%
Total Interest on loans   2,554,143    3,007,776    3,489,701    16.02%   36.63%
Overnight and market funds   2,803    4,930    5,942    20.53%   111.99%
Investment                         
Debt investments, net   12,479    22,475    43,030    91.46%   244.82%
Net gains from investment activities at fair value through income statement                         
Debt investments   138,994    72,108    173,660    140.83%   24.94%
Derivatives   (19,288)   (17,720)   (37,394)   111.03%   93.87%
Repos   (22,628)   15,695    3,368    -78.54%   114.88%
Other   (3,667)   (17,234)   1,681    109.75%   145.84%
Total Net gains from investment activities at fair value through profit and loss   93,411    52,849    141,315    167.39%   51.28%
Total interest on investment securities   105,890    75,324    184,345    144.74%   74.09%
Total interest income   2,662,836    3,088,030    3,679,988    19.17%   38.20%
Interest expense                         
Borrowing costs   (101,404)   (132,585)   (167,241)   26.14%   64.93%
Overnight funds   (2,130)   (839)   (1,423)   69.61%   -33.19%
Debt securities in issue   (234,846)   (299,541)   (341,406)   13.98%   45.37%
Deposits   (521,432)   (711,376)   (837,077)   17.67%   60.53%
Preferred Shares Dividends   (15,091)   (14,980)   (15,091)   0.74%   0.00%
Other interest (expense)   (9,815)   (5,751)   (6,770)   17.72%   -31.02%
Total interest expense   (884,718)   (1,165,072)   (1,369,008)   17.50%   54.74%
Net interest income   1,778,118    1,922,958    2,310,980    20.18%   29.97%
Loan loss provisions   (330,573)   (581,976)   (595,427)   2.31%   80.12%
Recovery of charged-off loans   29,108    58,432    61,820    5.80%   112.38%
Other assets impairment   1,834    63,948    (2,946)   -104.61%   -260.63%
Total net provisions   (299,631)   (459,596)   (536,553)   16.74%   79.07%
Net interest income after provision, net   1,478,487    1,463,362    1,774,427    21.26%   20.02%
Fees and other service income                         
Banking services   143,987    175,235    190,589    8.76%   32.37%
Credit and debit card fees   126,697    124,911    135,073    8.14%   6.61%
Electronic services and ATM fees   104,694    144,364    134,944    -6.53%   28.89%
Brokerage   4,736    5,201    5,831    12.11%   23.12%
Acceptances, Guarantees and Standby letters of credits   11,291    11,087    12,474    12.51%   10.48%
Trust   65,296    67,293    71,127    5.70%   8.93%
Bancassurance   53,516    77,889    72,093    -7.44%   34.71%
Payments and Collections   46,428    55,803    51,684    -7.38%   11.32%
Other   73,447    88,113    101,573    15.28%   38.29%
Total Fees and other service income   630,092    749,896    775,388    3.40%   23.06%
Fees and other service expenses                         
Banking services   (67,889)   (82,509)   (92,550)   12.17%   36.33%
Other   (96,221)   (161,688)   (128,889)   -20.29%   33.95%
Total Fees and other service expenses   (164,110)   (244,197)   (221,439)   -9.32%   34.93%
Total fees and income from services, net   465,982    505,699    553,949    9.54%   18.88%
Other operating income                         
Derivatives FX contracts   49,389    337,615    69,515    -79.41%   40.75%
Net foreign exchange   54,209    (250,209)   26,837    110.73%   -50.49%
Hedging   (7,887)   (831)   (13,985)   1582.91%   77.32%
Operating leases   102,551    125,170    117,383    -6.22%   14.46%
Gains (or losses) on sale of assets   13,539    6,282    12,764    103.18%   -5.72%
Other reversals   1,066    251    393    56.57%   -63.13%
Other income   146,101    159,393    175,485    9.31%   20.11%
Total other operating income   358,968    377,671    388,392    2.84%   8.20%
Dividends received and equity method                         
Dividends   9,967    3,116    11,980    284.47%   20.20%
Equity investments   10,203    44,208    41,019    -7.21%   302.03%
Equity method   33,727    65,192    10,841    -83.37%   -67.86%
Gains (Losses) on sale of Discontinued Operations   -    (16,128)   -    -100.00%   0.00%
Total Dividends received and equity method   53,897    96,388    63,840    -33.77%   18.45%
Total income   2,357,334    2,443,120    2,780,608    13.81%   17.96%

 

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INCOME STATEMENT              Growth 
(COP million)  1Q 15   4Q 15   1Q 16   1Q16 / 4Q15   1Q16 / 1Q15 
Operating expenses                         
Salaries and employee benefits   (469,143)   (502,897)   (582,698)   15.87%   24.20%
Bonuses   (53,850)   (80,281)   (115,478)   43.84%   114.44%
Administration and general expenses   (482,276)   (665,720)   (596,573)   -10.39%   23.70%
Contributions and other tax burden   (109,630)   (164,613)   (144,549)   -12.19%   31.85%
Provision, depreciation and amortization   (116,498)   (133,751)   (155,487)   16.25%   33.47%
Other expenses   (63,204)   (79,237)   (61,989)   -21.77%   -1.92%
Tax on wealth   (159,963)   -    (144,710)   0.00%   -9.54%
Total operating expenses   (1,454,564)   (1,626,499)   (1,801,484)   10.76%   23.85%
Profit before tax   902,770    816,621    979,124    19.90%   8.46%
Income tax   (258,266)   (98,904)   (550,848)   456.95%   113.29%
Net income before non-controlling interest   644,504    717,717    428,276    -40.33%   -33.55%
Non-controlling interest   (23,918)   (45,752)   (35,555)   -22.29%   48.65%
Net income before Discontinued Operations   620,586    671,965    392,721    -41.56%   -36.72%
Discontinued Operations Net Income   11,315    (15,613)   4,645    129.75%   -58.95%
Net income   631,901    656,352    397,366    -39.46%   -37.12%

 

  14

 

 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

    BANCOLOMBIA S.A.
    (Registrant)
     
Date:  May 23, 2016 By: /s/  JAIME ALBERTO VELÁSQUEZ B.
    Name: Jaime Alberto Velásquez B.
    Title: Vice President of Strategy and Finance