The bank’s results were supported by intermediation spread enhancement, focusing on more profitable credit asset products, and by improving the mix of deposits and pricing policy.
A plan to reduce expenses contributed greatly to a more efficient use of funds, reflected in a level of expenses below the rate of inflation. The bank’s 19.3% rise in expenses at June 2007 represented the lowest level among Venezuela’s four big banks. This helped Banco Provincial to cut its cost-income ratio 1400bp to 44.8% in the year. The bank also boosted net profits by 43.36% and assets by 59.3%, with a 2.2 percentage point cut in the cost-income ratio.
The bank launched several original products, such as the Instant Payroll Credit, which was a successful initiative that focused on an overlooked customer need. It also set up alliances with e-commerce related companies to reinforce its web banking traffic and boost the use of credit cards, a business segment that has cornered 13.57% of the market.
“We feel honoured and pleased for having been recognised as Bank of the Year 2007 in Venezuela,” says chief executive Jose Antonio Colomer. “This prize gratifies the efforts we put into being the best financial institution in the country. At the same time it reaffirms our commitment to quality, sustainable growth and [cost] austerity, which are key to our strategy.”
