Banco Santander México Reports Third Quarter 2021 Net Income of Ps.4,843 Million

MEXICO CITY, Oct. 28, 2021 /PRNewswire/ -- Banco Santander México, S.A., Institución de Banca Múltiple, Grupo Financiero Santander México (NYSE: BSMX; BMV: BSMX), ("Banco Santander México" or "the Bank"), today announced financial results for the three-month and nine-month periods ending September 30^th, 2021.

Banco Santander México reported net income of Ps.4,843 million in 3Q21, representing a YoY decrease of 3.7% and a QoQ increase of 2.8%. On a cumulative basis, net income for 9M21 reached Ps.12,835 million, representing a 12.5% YoY decrease.

Héctor Grisi, Banco Santander México's Executive President and CEO, commented: "During the quarter we continued advancing on our strategic priorities while maintaining a strong balance sheet and liquidity positions. Loan volumes continue lagging, mostly among commercial loans, in line with market trends and still soft demand conditions. However, we are optimistic, as we have started seeing a slight sequential upturn in certain loan segments. Another bright spot is our individual loans, which continue outpacing the market, supported by sustained market share gains in mortgages and auto loans. In addition, consumer and SME loans are now showing signs of a gradual sequential recovery, as economic activity starts to gather speed and our risk appetite in these segments has grown correspondingly.

For the third consecutive quarter, our deposits remained relatively stable sequentially. The high liquidity has allowed us to focus on improving our deposit mix by favoring demand deposits over term ones. In fact, our current deposit mix stands at 74% demand and 26% term, our best ratio ever. Both our individual and corporate demand deposits continue expanding at low double-digit rates year-over-year, underscoring the success of our loyalty and customer acquisition strategies as well as our focus on lowering funding costs.

Our asset quality also improved during the quarter, as NPLs continued falling, aided by improving economic conditions in Mexico and our sound loan portfolio, which still reflects our prudent risk management. We are also approaching a normalized level of provisions as our operating environment becomes healthier. Accordingly, our cost of risk has declined to its lowest level in the last five quarters, and we expect it to continue converging gradually to pre-pandemic levels.

Although domestic and global economic conditions are improving, they will likely remain uneven and challenging. Nevertheless, our strategy remains focused on further strengthening client loyalty and driving digitalization, with the same ambition to become the bank providing the best customer experience in Mexico. 

We continue working on growth initiatives by leveraging a host of new digital tools and methodologies and also by further enhancing our internal operating processes. With a focus on prudent and profitable growth, we continue making new investments in the bank's transformation, mainly in IT and digitalization, while seeking efficiencies and maintaining tight cost controls across business lines."

3Q21 Earnings Call Dial-In Information

ABOUT BANCO SANTANDER MÉXICO (NYSE: BSMX; BMV: BSMX)

Banco Santander México, S.A., Institución de Banca Múltiple, Grupo Financiero Santander México (Banco Santander México), one of Mexico's leading banking institutions, provides a wide range of financial and related services, including retail and commercial banking, financial advisory and other related investment activities. Banco Santander México offers a multichannel financial services platform focused on mid- to high-income individuals and small- to medium-sized enterprises, while also providing integrated financial services to larger multinational companies in Mexico. As of September 30^th, 2021, Banco Santander México had total assets of Ps.1,669 billion under Mexican Banking GAAP and more than 19.4 million customers. Headquartered in Mexico City, the Company operates 1,350 branches and offices nationwide and has a total of 24,901 employees.

INVESTOR RELATIONS CONTACT
Héctor Chávez Lopez – Managing Director - IRO
+ 52 (55) 5269-1925
[email protected]

Investor Relations Team
[email protected]                                                     

www.santander.com.mx

LEGAL DISCLAIMER
Banco Santander México cautions that this presentation may contain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements could be found in various places throughout this presentation and include, without limitation, statements regarding our intent, belief, targets or current expectations in connection with: asset growth and sources of funding; growth of our fee-based business; expansion of our distribution network; financing plans; competition; impact of regulation and the interpretation thereof; action to modify or revoke our banking license; exposure to market risks including interest rate risk, foreign exchange risk and equity price risk; exposure to credit risks including credit default risk and settlement risk; projected capital expenditures; capitalization requirements and level of reserves; investment in our information technology platform; liquidity; trends affecting the economy generally; and trends affecting our financial condition and our results of operations. While these forward-looking statements represent our judgment and future expectations concerning the development of our business, many important factors could cause actual results to differ substantially from those anticipated in forward-looking statements. These factors include, among other things: changes in capital markets in general that may affect policies or attitudes towards lending to Mexico or Mexican companies; changes in economic conditions, in Mexico in particular, in the United States or globally; the monetary, foreign exchange and interest rate policies of the Mexican Central Bank (Banco de México); inflation; deflation; unemployment; unanticipated turbulence in interest rates; movements in foreign exchange rates; movements in equity prices or other rates or prices; changes in Mexican and foreign policies, legislation and regulations; changes in requirements to make contributions to, for the receipt of support from programs organized by or requiring deposits to be made or assessments observed or imposed by, the Mexican government; changes in taxes and tax laws; competition, changes in competition and pricing environments; our inability to hedge certain risks economically; economic conditions that affect consumer spending and the ability of customers to comply with obligations; the adequacy of allowance for impairment losses and other losses; increased default by borrowers; our inability to successfully and effectively integrate acquisitions or to evaluate risks arising from asset acquisitions; technological changes; changes in consumer spending and saving habits; increased costs; unanticipated increases in financing and other costs or the inability to obtain additional debt or equity financing on attractive terms; changes in, or failure to comply with, banking regulations or their interpretation; and certain other risk factors included in our annual report on Form 20-F. The risk factors and other key factors that we have indicated in our past and future filings and reports, including those with the U.S. Securities and Exchange Commission, could adversely affect our business and financial performance. The words "believe," "may," "will," "aim," "estimate," "continue," "anticipate," "intend," "expect," "forecast" and similar words are intended to identify forward-looking statements. You should not place undue reliance on such statements, which speak only as of the date they were made. We undertake no obligation to update publicly or to revise any forward-looking statements after we distribute this presentation because of new information, future events or other factors. In light of the risks and uncertainties described above, the future events and circumstances discussed herein might not occur and are not guarantees of future performance.

Note: The information contained in this presentation is not audited. Nevertheless, the consolidated accounts are prepared on the basis of the accounting principles and regulations prescribed by the Mexican National Banking and Securities Commission (Comisión Nacional Bancaria y de Valores) for credit institutions, as amended (Mexican Banking GAAP). All figures presented are in millions of Mexican pesos, unless otherwise indicated. Historical figures are not adjusted by inflation.

SOURCE Banco Santander México, S.A.

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