Strong consumer loan demand lifts Banorte quarterly profit

By Natalia Siniawski

MEXICO ‌CITY, July 21 (Reuters) - ​Mexico's ​Grupo Financiero Banorte reported a 6% rise in second-quarter net profit on Tuesday, slightly above ‌estimates, boosted by strong demand for consumer loans ⁠and higher fee income.

Net profit reached 15.55 billion pesos ($888.64 million), ‌above an LSEG-compiled estimate of ‌15.53 billion pesos, as revenues totaled 43.15 billion pesos, up 12% year-over-year and above a forecast of ​42.41 billion pesos.

• Banorte named Tomas Lozano as chief financial officer; Rafael Arana, who previously held both ⁠the CFO and COO roles, will retain his position as chief operating ​officer.

• Lozano, a 19-year Banorte veteran who most recently led investor relations, corporate development and ​financial planning, will report to Arana, ‌the company said in a statement.

• Return on equity expanded to 25.7%, up 209 ⁠basis points year-over-year.

• Consumer loan growth led portfolio expansion, with auto and payroll loans each rising 4% sequentially and credit ⁠card loans up 2%.

• Net interest income fell 5% from the ​prior quarter, hurt by lower valuation of inflation-linked securities, though the bank said the effect was offset by adjustments to technical ‌reserves, leaving net income unaffected.

• Provisions fell 12% from the prior quarter following a ‌regulatory adjustment to reserve calculations for government-backed loans implemented ⁠in June, though they ‌rose 26% year-over-year in ​line with portfolio growth.

($1 = 17.4986 Mexican pesos at end-June)

(Reporting by Natalia Siniawski, Editing by Iñigo ‌Alexander)

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