Credicorp Ltd. (NYSE:BAP) stock rose 6.05% (As on Feb 8, 11:49:07 AM UTC-4, Source: Google Finance) after the company posted lower than expected results for the fourth quarter of FY 21. QoQ, total loans increased +0.7% and structural loans +2.7%; both metrics were affected by the -3.6% decrease in  the exchange rate. Structural growth was led by Retail Banking at BCP Stand-alone. All segments contributed to expansion, with the exception of SME-Business. Growth was driven by economic recovery in general and by personal consumption in particular given seasonal effects at year-end and due to the fact that sanitary restrictions were loosened. Mibanco’s portfolio registered structural growth of +4.7% in a context marked by record-high levels of disbursements. The microfinance segment was very dynamic in the last quarter of the year, in line with the seasonality that businesses experience at year-end. Total investments increased +1.8% QoQ due to purchases of low-risk instruments and new allocations of certificates of deposits. The funding level fell 2.0% QoQ. Deposits registered a drop QoQ. Nonetheless, if we isolate the exchange rate effect, growth of 0.4% was evident. The main drivers of these movements were: (i) The drop in demand deposits, which fell -4.1% (-2.0% if we exclude the exchange rate effect), was driven mainly by a decrease in current accounts in LC held by corporate clients and, to a lesser extent, by current accounts held by retail banking clients. The aforementioned reduction in retail accounts reflected clients’ use of funds from AFPs. (ii) A -5.1% decline in time deposits (-3.1% if we exclude the exchange rate effect). This drop was mainly driven by BCP Stand-alone and by Corporate Banking in particular. Growth in savings deposits particularly at BCP Stand-alone, which grew +4.7% QoQ (6.4% if the company exclude the exchange rate effect). This growth was mainly spurred from higher levels of savings by individuals, associated with bonus payments in the month of December.

Moreover, Credicorp’s funding cost in the fourth quarter remained low and stood at 1.24% (+3bps QoQ) in a context of strong growth in interest rates and an increase in the share of low-cost deposits in the funding mix. The structural funding cost, which excludes the effects of funding generated by Reactiva loans and other non-recurring funding expenses, rose slightly to 1.31% (+4bps QoQ).

BAP in the fourth quarter of FY 21 has reported the adjusted earnings per share of $3.30, missing the analysts’ estimates for the adjusted earnings per share of $3.36. The company had reported the adjusted revenue growth of 35.9 percent to $938.5 million in the fourth quarter of FY 21, which also did not meet Street forecasts.