Banesco, Venezuela's largest bank, saw its earnings expand by 48% in 2010, thanks entirely to even more rapid growth in its net interest margin (NIM).
According to numbers in its recently released 2H11 report to investors, the bank earned 906mn bolívares (US$211mn) in 2010, bumping its ROAE up to 23.6%, from 19.2% a year prior.
The bank owes the earnings bump almost entirely to a significant decline in the cost of deposits, which dropped 29.3% to 1.67bn bolívares.
Its financial income, on the other hand, increased by 10.2%, leaving the bank with a NIM of 3.14bn bolívares, up 56.6% from the previous year.
Earnings expanded significantly faster than annual inflation, which finished 2010 at around 27%.
However, Banesco's credit portfolio has not kept up pace, expanding by only 21.6% in 2010, to 27.6bn bolívares, according to the numbers released by the bank.
Banesco recently announced an expansion into the Dominican Republic, and its president, Juan Carlos Escotet, was just elected to a second two-year term as head of banking association ABV.