Last year proved stellar for Bancolombia, one of Latin America’s oldest banks and the largest in Colombia in terms of equity and assets. The institution reported pre-tax profits of $339m, up 53%, ranking it as one of the world’s best performing banks.

Earnings reported so far in 2005 are also positive. “The bank is growing at a healthy rate thanks to our basic strategy of sticking to a wide range of retail offerings,” says Jorge Londoño, president of Bancolombia.

The bank, with 1.6 million customers, is fusing its commercial activities with those of its latest acquisitions: Conavi, Colombia’s largest mortgage entity, and local investment bank Corfinsura. Mr Londoño is especially bullish when it comes to the mortgage market. “It is only now being tapped by commercial banks here,” he told The Banker. “Taking on this market segment with force will only help us form a more integrated portfolio.”

Mr Londoño, who has been with Bancolombia since 1993, attributes a chunk of last year’s growth to the bank’s increasing activity in microfinancing and lending to small and medium-sized companies. Lending to small enterprises has risen by more than 30% over the past year. In addition, the local credit card market is moving at a healthy rate. In Q1 2005, the bank reported that accumulated credit card billing increased 18% from the same period in 2004. It enjoys 13% of Colombia’s credit market market. “Demand is up and so are levels of disposable income,” says Mr Londoño.

Colombia’s strengthening economy, which is recovering fully from the crisis of the late 1990s, is helping the bank’s bottom line. In both 2003 and 2004, the economy expanded by 4%. The peso has appreciated, interest rates are declining and inflation is under control. All of this is helping to boost local investment and consumer spending.

Mr Londoño is proud of the fact that Bancolombia recently celebrated its 10th year on the New York Stock Exchange (it is the only Colombian company listed on the exchange). The liquidity offered by the exchange should also help the bank to roll with any unexpected kinks that could arise from the Conavi and Corfinsura integration.

Yet Mr Londoño also knows that he cannot let his guard down. Although Colombia’s economy is set for another year of growth, risks lingers such as the government’s management of public finances – which can be messy at times – and paramilitary and drug-related violence. Both factors could take a toll on investor confidence and damage banks’ earnings.



All fields are mandatory

The Banker is a service from the Financial Times. The Financial Times Ltd takes your privacy seriously.

Choose how you want us to contact you.

Invites and Offers from The Banker

Receive exclusive personalised event invitations, carefully curated offers and promotions from The Banker

For more information about how we use your data, please refer to our privacy and cookie policies.

Terms and conditions

Top 1000 2023

Request a demonstration to The Banker Database

Join our community

The Banker on Twitter