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BancoEstado highlights important progress in bankarization

Felipe Roca

, Feb 07, 2011. 03:00

At the presentation of the year-end balance, Segismundo Schulin-Zeuthen, Chairman of the State Bank, met with the specialized media in the finance sector. He underlined the good results in bankarization and the opportunities that can give this entity to the thousands of Chileans who need financial.
Segismundo Schulin-Zeuthen, Chairman of BancoEstado, made a positive balance of the entity, referring to the main results of the bank during the period and the most important challenges for this year. The executive said last year was very important for Chile from bankarization point of view, which resulted in an increase of microenterprise clients, and the activation of numbers for CuentaRUT and CajaVecina (neighborhood cash machines).

While 2010 "was a difficult year because of the earthquake, and had cross-effects for the bank that included more than 60 branches damaged, but we moved into the second half in areas quite important for people. Immediately after the earthquake, we offered the postponement of payments, which resulted in about 57000 operations benefiting customers’ segment and 26000 micro-entrepreneurs’ segment. We received over 43 thousand claims for affected households, the greatest bulk of the system, and after an enormous effort, we managed to respond almost all complaints, "he said. 

Financial results: a solid bank 

The achievement of positive results was very important for the bank. This means that the entity may continue strengthening its service network and growing in important segments of the country, such as micro and small enterprises. Segismundo Schulin-Zeuthen noted that "for economy and financial system 2010 was a year of recovery, with positive results for the banking sector. After growing 21.7% in 2009, in 2010 total placements of the bank grew 0.6% and we had a 14.8% profit before tax on capital and reserves." 

A significant element, he said, was the improvement in the efficiency ratio (defined as supporting expenses over operating income) which improved, reaching 58%. The executive underlined this improvement as per the social trend of the bank: "This bank serves low-income sectors, which basically generates high operating costs and low incomes [...] Today we are leading the mortgage industry under UF1.000; we are in places where no other bank, we daily bankarize new micro-entrepreneurs and Chileans have their bank at walking distance with the CajaVecina." 

He also stressed that the contribution delivered to the Treasury, for profit and taxes, was approximately $267 billion, equivalent to US$560 million, versus the $55 billion delivered in 2009. 

Likewise, he mentioned successful placement of a US$500 million bond in international markets (U.S., Europe and Asia), which demand exceeded 3.5 times the amount of issuance.

He finally underlined that for Chilean people this is a safe and solvent bank, with the best risk rating in Latin America. Standard & Poor's and Moody's confirmed the above, and gave Bancoestado an A+ and Aa3 long term rating, respectively. 

Presence: financial services for all Chileans 

Special importance was given to the impact of having more than 400 thousand micro-entrepreneurs customers. "It is a contribution to the financial system and also for the country, whereas a micro-entrepreneur creates jobs for others, and according to our estimates, that could generate about 1 million 200 thousand jobs, "he said. 

This effort is complemented by offering customers the widest geographic coverage, which is 343 offices, 84 ServiEstado offices, 1,812 ATMs and more than 4,500 CajaVecinas in the country. Thus, "we can say in pride that in 79 communes we are the only bank available."

At this point he stressed the importance of the celebration of the CajaVecina number 4,000 held in Quintay. This opening, which counted on the presence of the President of the Republic, Sebastián Piñera, confirmed the importance of this service channel for Chileans. "We're talking about people who had to spend over $2,500 only to move to Valparaiso and the consequent waste of time, only to withdraw money, charge mobile phones and pay basic service bills," said the executive, who highlighted the case of small fishermen from Quintay, who could lose even one entire working day only in processes that now can be solved quickly.

Better customer service 

Segismundo Schulin-Zeuthen emphasized the role of the bank and the millions of customers assisted today. "We are a mass bank and we hope to improve every day our customer service. A recent example is that we recently fully complied with the commitment to of reducing the consumer-credit approval/process time from one week to 48 hours, "he said.

The bank, he added, has more than 2.9 million customers with active CuentaRUTs, more than 12.8 million savings accounts, approximately 499,000 mortgage operations under UF1,000, with more than 600,000 clients with housing loans, 124 thousand study loans, more than 4.5 million of valid insurances and over 140 thousand customers with Mutual Funds. Besides, it’s leader in number of customers using Internet banking. 

These indicators, he said, show the social role of the bank and imply being where others are not. "We are the bank of Chileans and strive to fulfill all the needs of the population," he said. 

Challenges 

Finally, the executive explained the main challenges for the period, which will be primarily focused on responding to customer needs. "What does it mean? Means continue growing in areas such as CajaVecina, where we expect to reach 6,500 or in CuentaRUTs activated, and reach more than 3.5 million Chileans with an account."

In microenterprises, the bank aims to reach 425,000 bankarized micro-entrepreneurs, and growing as well in small and medium companies, offering a better service and products tailored to the needs of our customers. 
"This is how we hope to come out into the market of Options, for example, as with this we will be taking a new step in delivering solutions to the sector," he said.

Human Resources 

BancoEstado’s Chairman said that these results reflect the effort and care of the bank's employees. In 2010 we had good results, but also sadness, not only associated with the earthquake, but also to the loss of five officers who died in tragic car accidents.

But the bank had joy, he said, such as being one of the Best Companies to work in Chile, acknowledged by the Great Place to Work; Being among the best companies for working mothers and fathers given by El Mercurio and Fundación Chile Unido; or the National Award for Consumer Satisfaction by ProCalidad and Capital, which are all of them an acknowledgement for each worker of BancoEstado.