Credicorp tops Q2 expectations with soaring profits

Peru's largest financial services holding company Credicorp beat analysts' expectations in the second quarter with a big jump in earnings.

The group's recurring net income climbed 35% year-on-year to 740mn soles (US$230mn) and came in 2% above the market consensus forecast.

The results were much stronger than in 1Q15 when recurring net income rose 15% y-o-y.

Second quarter recurring ROE improved to 20.4% from 19.8% in the previous quarter and from 17.7% in 2Q14, the company's results release shows.

The better-than-expected earnings were due to several factors, including strong net interest and fee income, double-digit loan growth, reduced loan loss provisions, cost control and a solid performance by the Pacifico insurance group.

The banking subsidiary, BCP, was as usual the biggest earnings generator with net income of 606mn soles – up 43.2% on 2Q14.

"We think it was a solid quarter, which shows the bank's resilience to deliver strong results even with a weaker than expected economy," said Deutsche Bank in a note on the results.

Pacifico and pension fund manager Prima reported quarterly net profits of 66.1mn soles and 43.3mn soles, increasing 42.3% and 6.3% respectively from 2Q14.