Grupo Financiero Santander México Reports Third Quarter 2016 Loan Portfolio Up 13.8% YoY and Net Income of Ps.3,926 Million

MEXICO CITY, Oct. 27, 2016 /PRNewswire/ --Grupo Financiero Santander México, S.A.B. de C.V., (NYSE: BSMX; BMV: SANMEX), ("Santander México"), one of the leading financial groups in Mexico, today announced financial results for the three-month and nine-month periods ending September 30, 2016.

Santander México reported net income for 3Q16 of Ps.3,926 million, representing a YoY and QoQ increases of 13.3% and 5.9%, respectively. For 9M16, net income amounted to Ps.11,173 million, reflecting a 12.7% increase from 9M15.

Héctor Grisi, Grupo Financiero Santander México's Executive President and CEO, commented, "We reported strong performance this quarter as we continue to drive profitable growth. Importantly, this was achieved against the backdrop of a more challenging global environment, demonstrating the resilience of our business. Ongoing expansion in demand deposits and strong loan growth underpinned results, and we are increasingly able to leverage operating efficiencies."

"The strategic commercial initiatives launched earlier this year to become a client centric bank through a strong focus on innovation and operational transformation are starting to show promising results. Santander Plus boasts more than 700,000 customers, demonstrating the strength of our value proposition while reducing attrition. Most importantly, 50% of these are new clients. Our Aeromexico co-branded card is proving very successful with over 300,000 customers to date. Progress was also made in implementing technological innovation, a key element of our strategy. We are pleased to report that we reached more than 1.2 million digital customers this quarter and expect to almost double this figure by 2019."

"Meanwhile, we continue to consolidate our position in commercial loans, maintaining a disciplined philosophy in terms of returns on risk weighted assets and applying a risk-based pricing approach in SMEs and mid-market."

"Solid loan book expansion of 14% year-on-year together with higher interest rates since December 2015 boosted Net Interest Income by 15% year-on-year and 5% sequentially. Moreover, NIM improved 15 bps sequentially reaching 5.01% this quarter. We also reported year-on-year improvements in the NPL ratio and cost of risk. Our increased focus on return on risk weighted assets and efficiency, along with our commercial initiatives have allowed us to gain traction in profitability metrics, supporting year-on-year net income growth of 13.3%, RoAE of 13.4% and the best efficiency ratio this year."

"We remain committed to executing strategic initiatives that will position Santander México as our customers' primary bank and are confident in our ability to keep delivering sustainable profitable growth in the best interests of all stakeholders."

To obtain the full text of this earnings report and the 3Q16 earnings presentation, please click on the following link: http://www.santander.com.mx/ir/english/financial/quarterly.html

ABOUT GRUPO FINANCIERO SANTANDER MÉXICO, S.A.B. DE C.V. (NYSE: BSMX; BMV: SANMEX) 
Grupo Financiero Santander México, S.A.B. de C.V. (Santander México), one of Mexico's leading financial services holding companies, provides a wide range of financial and related services, including retail and commercial banking, securities brokerage, financial advisory and other related investment activities. 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, 2016, Santander México had total assets of Ps.1,242 billion under Mexican Banking GAAP and more than 13 million customers. Headquartered in Mexico City, the Company operates 1,076 branches and 311 offices nationwide and has a total of 16,828 employees.

LEGAL DISCLAIMER 
Grupo Financiero Santander México cautions that this report may contain forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements may be found in various places throughout this report 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; our focus on strategic businesses; our compound annual growth rate; our risk, efficiency and profitability targets; financing plans; competition; impact of regulation; 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; 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, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from our expectations. These factors include, but are not limited to: 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 Mexico); 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; 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 allowances for loans and other losses; increased default by borrowers; 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; and certain other factors indicated in our  annual report20F. 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.

Note: The information contained in this report 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 nominal terms. Historical figures are not adjusted for inflation.

SOURCE Grupo Financiero Santander Mexico, S.A.B. de C.V.