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Mexico's Banorte posts 9% profit climb in Q1 as loan book grows

Published 04/16/2024, 05:43 PM
Updated 04/16/2024, 07:02 PM
© Reuters. A general view shows the of headquarters of Banorte Bank in Monterrey, Mexico, June 17, 2019. REUTERS/Daniel Becerril/File Photo

By Kylie Madry

MEXICO CITY (Reuters) -Mexico's Grupo Financiero Banorte reported on Tuesday a 9% hike in first-quarter net profit from the year-ago period, citing growth in its loan book.

Net profit for the quarter hit 14.21 billion pesos ($859.48 million), as its active loan book topped 1 trillion pesos for the third-consecutive quarter.

Net interest income, the difference between what banks earn on loans and dole out in deposits, grew 10% year-over-year on the larger loan book, which also benefited from higher interest rates.

Nearly all loan sectors showed double-digit growth year-over-year. Government loans, however, shrank 2.2% on election-year restrictions, Banorte said.

Mexico's central bank lowered its benchmark interest rate from a historic high of 11.25% to 11% in March, the effects of which "will be seen starting in the second quarter," Banorte said in a release.

Revenue for the group, which owns one of the country's largest banks and pension funds, totaled 37.038 billion pesos in the quarter, up 15% from a year earlier.

Return on equity grew 78 basis points year-over-year to 22.2%. The firm estimates a ROE between 21% and 22% for the year.

Non-financial expenses in the quarter grew 13% from the year-ago period on growth initiatives such as Banorte's digital bank, Bineo.

© Reuters. A general view shows the of headquarters of Banorte Bank in Monterrey, Mexico, June 17, 2019. REUTERS/Daniel Becerril/File Photo

Banorte launched Bineo in January, aiming to add 2.8 million new clients over the next five years.

($1= 16.5310 Mexican pesos at the end of March)

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