Gaining Momentum and Capitalizing on Local Expertise
The prestigious magazine Euromoney has named Banorte “Best Bank of the year in Mexico” and “Best Bank in Latin America” in 2008, as a recognition of its leadership and financial solidity.
Banorte is the last remaining large bank in Mexico controlled by local share-holders. The rest of the large banks are controlled by international behemoths such as Citigroup, BBVA, Santander, HSBC and Scotiabank. In spite of the large international scale of its competitors, Banorte has been a formidable player and has consolidated its leading position in many market segments, including mortgages and SMEs, while increasing its market share in other key segments, such as credit cards and mutual funds.
The bank serves almost 6.5 million clients through its nationwide footprint network. It has added more than 1 million clients over the past 15 months, making it one of the fastest-growing banks. Its branch network is the fourth-largest in the country, expanding at a yearly rate of 6%, while its ATM network is the fifth-largest, with an annual expansion rate of 17%. The bank ranks fourth in market share of deposits and fifth in loans nationwide.
In addition to important investments carried out over the last three years to expand its distribution network and IT platforms, Banorte is continuously improving its efficiency.
Growth on a Sound Footing
Banorte continues to grow on a sound footing. In 2008, the overall performing loan portfolio has been growing at a 28% annual rate. The bank’s loan portfolio is mainly composed of commercial and mortgage loans, which create high customer loyalty and provide a combination of attractive yields and low delinquency rates.
Non-interest-bearing deposits have been growing at an annual rate of 19% in 2008, above the industry average. The funding mix has remained attractive, helping to contain funding cost pressures and supporting higher margins. In terms of asset quality, the past due loan ratio (PDL) stands at 1.5%, one of the lowest in the industry and well below the industry’s average of 2.8%.
North of the Border
Regarding acquisitions and alliances, Banorte recently expanded its presence into the United States through the purchase of Texas-based Inter National Bank (INB), and two remittance companies, Motran and Uniteller, based in California and New Jersey, respectively. Also, in early 2008, Banorte reached an agreement with Comercial Mexicana (CCM), one of the leading retailers in Mexico, to establish a strategic alliance. Through this joint venture, Banorte and CCM will offer innovative financial products and services through CCM’s 200 points of sale, having access to around 6 million customers, most of whom are unbanked.
The bank is also highly committed to modern corporate governance practices and the creation of shareholder value. For the third consecutive year, Banorte has achieved a return on equity (ROE) of at least 20%, a commitment made to its shareholders, while delivering strong earnings growth and sustaining a 15% dividend payout ratio. This has translated into strong value creation reflected in the stock’s consistent outperformance of the Mexican Stock Exchange.
David Ricardo Suàrez
Investor Relations Officer
Av. Prolongación de la Reforma 1230
Col. Cruz Manca Santa Fe
Mexico City, 05300
Tel. +52 (55) 5268 1680