Edgar Filing: FOREIGN TRADE BANK OF LATIN AMERICA, INC.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE

SECURITIES EXCHANGE ACT OF 1934

Long Form of Press Release

Commission File Number 1-11414

BANCO LATINOAMERICANO DE COMERCIO EXTERIOR, S.A.

(Exact name of Registrant as specified in its Charter)

FOREIGN TRADE BANK OF LATIN AMERICA, INC.

(Translation of Registrant’s name into English)

Business Park Torre V, Ave. La Rotonda, Costa del Este

P.O. Box 0819-08730

Panama City, Republic of Panama

(Address of Registrant’s Principal Executive Offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F x Form 40-F ¨

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes ¨ No x

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes ¨ No x

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: February 9, 2018

FOREIGN TRADE BANK OF LATIN AMERICA, INC.
(Registrant)

	By:	/s/ Pierre Dulin

	Name:	Pierre Dulin
	Title:	General Manager

BLADEX’S ANNOUNCES PROFITS FOR THE FOURTH QUARTER AND FULL-YEAR 2017 OF $20.6 MILLION, OR $0.52 PER SHARE, AND $82.0 MILLION, OR $2.09 PER SHARE, RESPECTIVELY

PANAMA CITY, REPUBLIC OF PANAMA, February 9, 2018

Banco Latinoamericano de Comercio Exterior, S.A. (NYSE: BLX, “Bladex”, or “the Bank”), a Panama-based multinational bank originally established by the central banks of 23 Latin-American and Caribbean countries to promote foreign trade and economic integration in the Region, today announced its results for the fourth quarter (“4Q17”) and full-year (“FY17”) ended December 31, 2017 (“Y/E17”).

The consolidated financial information in this document has been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”).

FINANCIAL SNAPSHOT

(US$ million, except percentages and per share amounts)	2017			2016			4Q17			3Q17			4Q16
Key Income Statement Highlights
Total income	$	138.3		$	168.0		$	34.5		$	31.1		$	43.2
Expenses:
Impairment loss from ECL on loans, loan commitments and financial guarantees contracts, and investment securities	$	9.4		$	35.1		$	0.8		$	0.7		$	17.7
Operating expenses ^{(1) (*)}	$	46.9		$	45.8		$	13.1		$	10.0		$	12.1
Profit for the period	$	82.0		$	87.0		$	20.6		$	20.5		$	13.3
Profitability Ratios
Earnings per Share ("EPS") ⁽²⁾	$	2.09		$	2.23		$	0.52		$	0.52		$	0.34
Return on Average Equity (“ROAE”) ⁽³⁾		8.0	%		8.8	%		7.9	%		7.9	%		5.3	%
Return on Average Assets (“ROAA”)		1.27	%		1.16	%		1.31	%		1.30	%		0.73	%
Net Interest Margin ("NIM") ⁽⁴⁾		1.85	%		2.08	%		1.78	%		1.76	%		2.05	%
Net Interest Spread ("NIS") ⁽⁵⁾		1.48	%		1.84	%		1.38	%		1.37	%		1.79	%
Efficiency Ratio ⁽⁶⁾		34	%		27	%		38	%		32	%		28	%
Assets, Capital, Liquidity & Credit Quality
Commercial Portfolio ⁽⁷⁾	$	5,999		$	6,444		$	5,999		$	5,706		$	6,444
Treasury Portfolio	$	94		$	108		$	94		$	88		$	108
Total assets	$	6,274		$	7,181		$	6,274		$	6,200		$	7,181
Total stockholders' equity	$	1,043		$	1,011		$	1,043		$	1,032		$	1,011
Market capitalization ⁽⁸⁾	$	1,061		$	1,153		$	1,061		$	1,159		$	1,153
Tier 1 Basel III Capital Ratio ⁽⁹⁾		21.1	%		17.9	%		21.1	%		20.3	%		17.9	%
Total assets / Total stockholders' equity (times)		6.0			7.1			6.0			6.0			7.1
Liquid Assets / Total Assets ⁽¹⁰⁾		9.9	%		14.0	%		9.9	%		12.2	%		14.0	%
NPL to Loan Portfolio ⁽¹¹⁾		1.07	%		1.09	%		1.07	%		1.20	%		1.09	%
Total allowance for ECL to Commercial Portfolio ⁽¹²⁾		1.47	%		1.73	%		1.47	%		2.04	%		1.73	%
Total allowance for ECL to NPL (times) ⁽¹²⁾		1.5			1.7			1.5			1.8			1.7

^(*)2017 and 4Q17 operating expenses include personnel non-recurring expenses of $3.2 million, and $1.7 million, respectively.

4Q17 & FY17 Highlights

Reported results:

Profit for the 4Q17 and FY17 totaled $20.6 million (+1% QoQ, +54% YoY) and $82.0 million (-6% YoY), respectively.

4Q17 results were positively impacted on a sequential quarterly basis by increased fees (+59%) mostly from two successfully closed syndicated transactions, offset by non-recurring and seasonally higher operating expenses (+32%), while Net Interest Income (“NII”) totaling $28.1 million and Net Interest Margin “(NIM”) of 1.78% slightly increased (+1% and +2 bps, respectively) on higher average loan book, reversing the declining trend experienced in recent quarters.

YoY quarterly results benefited mostly from lower provision charges for expected credit losses (“ECL”) totaling $0.8 million in 4Q17 compared to $17.7 million in 4Q16, together with increased fees from letters of credit and syndication activities (+37%), which more than compensated lower NII (-25%) on lower average loan portfolio and margins.

2017 annual results were 6% lower, impacted by lower average loan volumes and margins, as the Bank de-risked and diversified its portfolio mix, and shortened its average loan tenors. This decline was partly compensated by a 45% increase in Net Other income on seven closed syndication transactions, increased letters of credit activity, the absence of non-core trading losses, and a decline of $25.7 million in provision charges for ECL.

Total Operating expenses were up 2% for the year. Recurring operating expenses were actually down 4% YoY, as personnel changes non-recurring expenses resulted in $3.2 million in charges for 2017.

Key performance metrics:

2017 Return on Average Equity (“ROAE”) stood at 8.0%, compared to 8.8% a year ago, as the result of lower profits for 2017 and strong levels of capitalization. Annualized ROAE was 7.9% in 4Q17, unchanged from the 3Q17 and up from 5.3% in 4Q16, on YoY higher profits.

The Efficiency Ratio reached 38% in 4Q17 (+6 pt. QoQ, +10 pts. YoY), and 34% for FY17 (+7 pts. YoY), mainly due to non-recurring operating expenses which surpassed total income improvement QoQ, and lower total income generation YoY both on a quarterly and annual basis.

The Tier 1 Basel III Capital Ratio increased to 21.1% at Y/E17, compared to 20.3% in 3Q17 and 17.9% at Y/E16, reflecting higher levels of capitalization with risk-weighted assets flat QoQ and down 13% YoY.

Commercial Portfolio & Quality:

Commercial Portfolio resumed growth in 4Q17 with EoP balances reaching $6.0 billion at Y/E17 (+5% QoQ, -7% YoY), and 4Q17 average balances totaling $5.8 billion (+3% QoQ, -12% YoY) as credit demand recovered lately across the Region with higher volume of origination, while still down YoY on the Bank’s focus of de-risking throughout 2017. FY17 average balances reached $5.9 billion (-14% YoY).

Credit quality improved to 1.07% of Loan Portfolio balances at Y/E17, vs. 1.20% in 3Q17 and 1.09% at Y/E16, as non-performing loans (“NPL”) decreased to $58.8 million at Y/E17, as the net result of write-offs against existing individually allocated reserves, a NPL collection and a credit exposure migration to NPL from underperforming.

CEO’s Comments

Mr. Rubens V. Amaral Jr., Bladex’s Chief Executive Officer, stated the following regarding the Bank’s 4Q17 and FY17 results: “2017 proved yet another challenging year for Bladex. Nevertheless, the fourth quarter has confirmed the positive trends of our business as alluded to in the third quarter’s earnings release. We increased the end-of-period portfolio balances reversing a stretch of declining activity in previous quarters. Fee income increased in 2017, and we delivered a ROE of 8.0% for the year. The projections for 2018 for economic growth in Latin America have been revised up by the World Bank and the IMF which bodes well for our business this year.

Our credit quality remains resilient, with NPL levels reduced to 1.07% of total loans at the end of the year, as the Bank continued to finalize agreements on a limited number of exposures that have been closely monitored and had undergone restructuring negotiations for several quarters. During the fourth quarter, the Bank successfully collected a remaining deteriorated exposure in Panama, and wrote off certain non-performing exposures against existing specific provisions.

On the other hand, we have adjusted the size of the Bank to reflect the reality of our business, and our determination to improve productivity and efficiency across the organization. This organizational restructuring produced a non-recurring impact on our operating expenses in the fourth quarter related to severance costs. We are confident that with a leaner organization and more efficient processes we have positioned the Bank to achieve our target of excellence throughout the organization, setting the basis to return to higher levels of profitability.

Our Board of Directors approved to maintain a dividend of US$ 0.385 for the fourth quarter confirming their favorable view of our financial strength and our ability to resume portfolio growth with sustainable double-digit ROEs moving forward. The Bank has a cleaner and stronger balance sheet and has left behind a negative credit cycle which impacted our financial performance in the last two years, and it is ready to resume growth on a sustainable basis.” Mr. Amaral concluded.

RESULTS BY BUSINESS SEGMENT

The Bank’s activities are managed and executed in two business segments, Commercial and Treasury. The business segment results are determined based on the Bank’s managerial accounting process as defined by IFRS 8 – Operating Segments, which assigns consolidated statement of financial positions, revenue and expense items to each business segment on a systemic basis.

COMMERCIAL BUSINESS SEGMENT

The Commercial Business Segment encompasses the Bank’s core business of financial intermediation and fee generation activities developed to cater to corporations, financial institutions and investors in Latin America. These activities include the origination of bilateral and syndicated credits, short-term and medium-term loans, customers’ liabilities under acceptances, loan commitments and financial guarantee contracts. Profits from the Commercial Business Segment include (i) net interest income from loans; (ii) Fees and Other Income from the issuance, confirmation and negotiation of letters of credit, guarantees and loan commitments, and through loan structuring and syndication activities; and (iii) gain on the sale of loans generated through loan intermediation activities, such as sales in the secondary market and distribution in the primary market; (iv) impairment loss (recovery) from ECL on loans, loan commitments and financial guarantee contracts; and (v) direct and allocated operating expenses.

The Commercial Portfolio resumed growth in the 4Q17 as EoP and average portfolio balances reached $6.0 billion and $5.8 billion, respectively, resulting in QoQ increases of 5% and 3%, respectively, as credit demand recovered lately across the Region with higher volume of origination, while still down 7% and 12% compared to a year ago, on the Bank’s focus of de-risking throughout 2017. On an annual basis, FY17 average Commercial Portfolio balances were $5.9 billion, a 14% YoY decrease compared to $6.8 billion a year ago. As of December 31, 2017, 81% of the Commercial Portfolio was scheduled to mature within a year, the same level from a quarter ago and up from 77% a year ago, while trade finance transactions represented 60% of the Commercial Portfolio at Y/E17, down from 66% a quarter and year ago, but still focused on trade-related operations.

The following graphs illustrate the geographic distribution of the Bank’s Commercial Portfolio, highlighting the portfolio´s diversification by country of risk, and across industry segments:

Refer to Exhibit X for additional information relating to the Bank’s Commercial Portfolio distribution by country, and Exhibit XII for the Bank’s distribution of credit disbursements by country.

(US$ million)	2017			2016			YoY (%)			4Q17			3Q17			4Q16			QoQ (%)			YoY (%)
Commercial Business Segment:
Net interest income	$	120.6		$	140.4			-14	%	$	28.9		$	28.3		$	35.0			2	%		-17	%
Net other income ⁽¹³⁾		18.9			16.3			16	%		6.5			3.7			4.7			75	%		39	%
Total income		139.5			156.7			-11	%		35.4			32.1			39.7			11	%		-11	%
Impairment loss from ECL on loans and loan commitments and financial guarantees contracts		(9.9	)		(35.1	)		72	%		(0.9	)		(0.6	)		(18.0	)		-55	%		95	%
Operating expenses		(35.9	)		(34.6	)		-4	%		(9.7	)		(7.7	)		(9.2	)		-26	%		-6	%
Profit for the period	$	93.7		$	87.0			8	%	$	24.9		$	23.8		$	12.5			5	%		98	%

4Q17 and FY17 Commercial Business Segment’s results were mainly impacted by:

YoY lower net interest income and margins as the Bank shortened its tenors, and experienced margin pressures from high USD liquidity in key markets, partly compensated by the increase in LIBOR-based market rates;

ii.

Higher net other income mostly from improved activity in the letters of credit business in the 4Q17 and FY17, and increased commissions from the syndication business, which successfully closed two more structured transactions in 4Q17, for a total of seven transactions for FY17;

iii.

YoY decreased provisions for ECL mostly reflecting finalized restructurings and lower requirements from reduced portfolio levels; and

iv.

Higher allocated operating expenses, mainly due to personnel changes non-recurring expenses incurred in 4Q17 and during 2017.

TREASURY BUSINESS SEGMENT

The Treasury Business Segment is responsible for the Bank’s funding and liquidity management, along with the management of its activities in investment securities, and the Bank’s interest rate, liquidity, price and currency positions. Interest-earning assets managed by the Treasury Business Segment include liquidity positions (cash and cash equivalents), and financial instruments related to the investment management activities, consisting of financial instruments at fair value through OCI and securities held-to-maturity (“Investment Securities Portfolio”). The Treasury Business Segment also manages the Bank’s interest-bearing liabilities, which constitute its funding sources, mainly deposits, short- and long-term borrowings and debt.

Profit from the Treasury Business Segment includes net interest income derived from the above mentioned treasury assets and liabilities, and related net other income (net results from derivative financial instruments and foreign currency exchange, gain (loss) per financial instruments at fair value through profit or loss, gain (loss) per financial instruments at fair value through OCI, and other income), impairment loss from ECL on investment securities, and direct and allocated operating expenses.

As of December 31, 2017, the Treasury Business Segment totaled $0.8 billion, down 15% from a quarter ago and 36% from a year ago, mainly on lower cash and cash equivalent balances, as the Bank reverts to its historical adequate levels of prudent liquidity management. The Bank establishes and monitors requirements for internal liquidity management through limits and policies based on the Basel III Liquidity Coverage Ratio (“LCR”). Liquidity balances amounted to $0.6 billion as of December 31, 2017, of which 98% of the Bank’s liquid assets were held in deposits with the Federal Reserve Bank of New York, compared to $0.8 billion, or 99% of liquid assets, at the end of 3Q17, and compared to $1.0 billion, or 59% of liquid assets, at the end of 4Q16. As of these quarter-end dates, the liquid assets to total assets ratio was 9.9%, 12.2%, and 14.0%, respectively, while the liquid assets to total deposits ratio was 21.1%, 25.2%, and 36.0%, respectively.

The Investment Securities Portfolio balances of $94 million at the end of the 4Q17 accounted for 1% of total assets at the end of 4Q17, compared to $88 million, or the same level of total assets, a quarter ago, and compared to $108 million, or 2% of total assets, a year ago, as the Bank aims to reduce market risk. The Investment Securities Portfolio mostly consisted of readily-quoted Latin American securities, 79% of which represented sovereign or state-owned risk (refer to Exhibit XI for a per-country risk distribution of the Investment Securities Portfolio).

Deposit balances amounted to $2.9 billion at the end of 4Q17, down 2% QoQ and up 4% YoY, representing 57% of total funding sources, compared to 59% and 46%, at the end of 3Q17 and 4Q16, respectively. Deposits placed by central banks or designees (i.e.: Class A shareholders of the Bank) represented 67% of total deposits as of December 31, 2017. At that same date, short-term borrowings and debt increased 46% QoQ while long-term borrowings and debt decreased 16% QoQ, (-27% and -36% YoY, respectively), to reach each one $1.1 billion at the end of the 4Q17, increasing the short-term composition of the overall funding sources, aligned with the lending book moving towards shorter tenors. The 4Q17 and FY17 weighted average funding cost was 2.10% (up 4 bps QoQ and 60 bps YoY) and 1.95% (up 56 bps YoY), respectively, mainly reflecting the increase in LIBOR-based market rates, partly compensated by decreasing funding spreads.

(US$ million)	2017			2016			YoY (%)			4Q17			3Q17			4Q16			QoQ (%)			YoY (%)
Treasury Business Segment:
Net interest income	$	(0.8	)	$	14.8			-105	%	$	(0.8	)	$	(0.4	)	$	2.7			-82	%		-129	%
Net other loss ⁽¹³⁾		(0.4	)		(3.6	)		88	%		(0.2	)		(0.6	)		0.8			73	%		-118	%
Total income (loss)		(1.2	)		11.3			-111	%		(0.9	)		(1.0	)		3.5			5	%		-127	%
Recovery (Impairment) loss from ECL on investment securities		0.5			(0.0	)		n.,m.			0.1			(0.1	)		0.3			232	%		-64	%
Operating expenses		(11.0	)		(11.2	)		2	%		(3.4	)		(2.2	)		(3.0	)		-53	%		-16	%
(Loss) Profit for the period	$	(11.7	)	$	0.0			n.m.		$	(4.3	)	$	(3.3	)	$	0.8			-29	%		n.m.

"n.m." means not meaningful.

4Q17 and FY17 Treasury Business Segment’s results were mainly impacted by:

An increase in funding rates on higher LIBOR-based market rates (also impacting interest-earning assets lending rates), partly compensated with lower funding spreads; and

ii.

A relatively stable funding mix source YoY (i.e. medium- and long-term borrowings and debt) despite higher short-term trade finance lending book, limited gap income.

NET INTEREST INCOME AND MARGINS

(US$ million, except percentages)	2017			2016			YoY (%)			4Q17			3Q17			4Q16			QoQ (%)			YoY (%)
Net Interest Income ("NII") by Business Segment
Commercial Business Segment	$	120.6		$	140.4			-14	%	$	28.9		$	28.3		$	35.0			2	%		-17	%
Treasury Business Segment		(0.8	)		14.8			-105	%		(0.8	)		(0.4	)		2.7			-82	%		-129	%
Combined Business Segment NII	$	119.8		$	155.2			-23	%	$	28.1		$	27.9		$	37.7			1	%		-25	%
Net Interest Margin		1.85	%		2.08	%		-11	%		1.78	%		1.76	%		2.05	%		1	%		-13	%

4Q17 and FY17 Net Interest Income and margins were mainly impacted by:

Higher NIM in 4Q17 (+2 bps QoQ) with increased average lending balances (+1% QoQ);

ii.

YoY reductions on average loan portfolio balances as a result of the Bank’s efforts to de-risk and diversify its portfolio towards short-term trade finance exposures;

iii.

Tighter net lending spreads in 2017 as the Bank shifted towards shorter tenor lending and experienced margin pressures from high USD liquidity in key markets, partly compensated by the effects of increased lending LIBOR-based rates; and

iv.

YoY increased funding rates on higher LIBOR-based market rates, partly compensated with lower funding spreads.

FEES AND OTHER INCOME

Fees and Other Income includes the fee income associated with letters of credit and other contingent credits, such as guarantees and credit commitments, as well as fee income derived from loan structuring and syndication activities, together with loan intermediation and distribution activities in the primary and secondary markets.

(US$ million)	2017		2016		YoY (%)			4Q17		3Q17		4Q16		QoQ (%)			YoY (%)
Fees and Commissions *	$	17.5	$	14.3		22	%	$	5.7	$	3.6	$	4.1		59	%		37	%
Letters of credit and other contingent credits		10.9		8.5		28	%		2.9		2.3		2.8		29	%		4	%
Loan structuring and distribution fees		6.6		5.8		14	%		2.7		1.3		1.3		111	%		109	%
Gain on sale of loans		0.2		0.8		-78	%		0.1		0.0		0.3		353	%		-78	%
Other income, net		1.7		1.4		25	%		0.9		0.2		0.3		354	%		184	%
Fees and Other Income	$	19.4	$	16.5		18	%	$	6.6	$	3.8	$	4.8		76	%		40	%

* Net of commission expenses

4Q17 and FY17 Fees and Other Income were mainly impacted by:

Increased commissions from the syndication business, which successfully closed two more structured transactions in 4Q17, for a total of seven transactions for FY17; and

ii.

Higher fees from improved activity in the letters of credit business in the 4Q17 and FY17.

PORTFOLIO QUALITY AND ALLOWANCE FOR ECL ON LOANS, LOAN COMMITMENTS AND FINANCIAL GUARANTEE CONTRACTS

(US$ million, except percentages)	31-Dec-17			30-Sep-17			30-Jun-17			31-Mar-17			31-Dec-16
Allowance for ECL on loans
Balance at beginning of the period	$	111.7		$	115.6		$	109.9		$	106.0		$	106.3
Provisions		(1.1	)		0.4			5.7			4.0			17.6
Write-offs, net of recoveries		(29.3	)		(4.2	)		0.0			0.0			(17.9	)
End of period balance	$	81.3		$	111.7		$	115.6		$	109.9		$	106.0

Allowance for ECL on loan commitments and financial guarantee contracts:
Balance at beginning of the period	$	4.8		$	4.6		$	5.9		$	5.8		$	5.4
Provisions (Reversals)		2.0			0.2			(1.3	)		0.2			0.4
End of period balance	$	6.8		$	4.8		$	4.6		$	5.9		$	5.8

Total allowance for ECL (allowance for ECL on loans plus allowance for ECL on loan commitments and financial guarantee contracts)	$	88.1		$	116.6		$	120.2		$	115.9		$	111.8

Total allowance for ECL to Commercial Portfolio		1.47	%		2.04	%		2.06	%		1.89	%		1.73	%
NPL to gross loan portfolio		1.07	%		1.20	%		1.12	%		1.14	%		1.09	%
Total allowance for ECL to NPL (times)		1.5			1.8			1.9			1.8			1.7

The total allowance for ECL amounted to $88.1 million at December 31, 2017, representing 1.47% of the total Commercial Portfolio, compared to $116.6 million and 2.04%, respectively, as of September 30, 2017, and compared to $111.8 million and 1.73%, respectively, as of December 31, 2016. The QoQ and YoY decreases of $28.5 million and $23.7 million, respectively, were mostly attributable to write-offs against existing individually allocated reserves following finalized restructuring processes.

At the end of 4Q17, NPL balances decreased to $58.8 million, representing 1.07% of Loan Portfolio balances, compared to $64.1 million, or 1.20% of Loan Portfolio in 3Q17, and $65.4 million, or 1.09% of Loan Portfolio in 4Q16, as the net result of write-offs against existing individually allocated reserves, a NPL collection and a credit exposure migration to NPL from underperforming. The ratio of the total allowance for ECL to NPLs stood at 1.5 times as of the end of December 31, 2017, compared to 1.8 times from the previous quarter, and 1.7 times a year ago.

OPERATING EXPENSES

Operating expenses reflect the following line items of the consolidated statements of profit or loss:

(US$ million, except percentages)	2017			2016			YoY (%)			4Q17			3Q17			4Q16			QoQ (%)			YoY (%)
Salaries and other employee expenses	$	27.7		$	25.2			10	%	$	7.3		$	5.8		$	6.2			26	%		19	%
Depreciation of equipment and leasehold improvements		1.6			1.5			8	%		0.4			0.4			0.4			6	%		1	%
Amortization of intangible assets		0.8			0.6			33	%		0.3			0.2			0.2			64	%		31	%
Other expenses		16.8			18.5			-9	%		5.1			3.6			5.3			43	%		-5	%
Total Operating Expenses	$	46.9		$	45.8			2	%	$	13.1		$	10.0		$	12.1			32	%		8	%

Efficiency Ratio		34	%		27	%		24	%		38	%		32	%		28	%		19	%		35	%

4Q17 and FY17 Operating Expenses were mainly impacted by:

Higher salaries and other employee expenses due to personnel changes non-recurring expenses incurred in 4Q17; and

ii.

YoY reduction in other operating expenses mostly from lower administrative, maintenance and professional services expenses, as a result of the Bank’s focus on cost reduction and high productivity throughout the organization.

The Bank’s Efficiency Ratios reached 38% in 4Q17 (+6 pt. QoQ, +10 pts. YoY), and 34% for FY17 (+7 pts. YoY), mainly due to non-recurring operating expenses which surpassed total income improvement QoQ, and lower total income generation YoY both on a quarterly and annual basis.

CAPITAL RATIOS AND CAPITAL MANAGEMENT

The following table shows capital amounts and ratios as of the dates indicated:

(US$ million, except percentages and shares outstanding)	31-Dec-17			30-Sep-17			31-Dec-16			QoQ (%)			YoY (%)
Tier 1 Capital ⁽⁹⁾	$	1,043		$	1,032		$	1,012			1	%		3	%
Risk-Weighted Assets Basel III ⁽⁹⁾	$	4,931		$	5,082		$	5,662			-3	%		-13	%
Tier 1 Basel III Capital Ratio ⁽⁹⁾		21.1	%		20.3	%		17.9	%		4	%		18	%
Total stockholders’ equity	$	1,043		$	1,032		$	1,011			1	%		3	%
Total stockholders’ equity to total assets		16.6	%		16.6	%		14.1	%		0	%		18	%
Accumulated other comprehensive income (loss) ("OCI")	$	0		$	(2	)	$	(3	)		124	%		115	%
Total assets / Total stockholders' equity (times)		6.0			6.0			7.1			0	%		-15	%
Shares outstanding (in thousand)		39,429			39,365			39,160			0	%		1	%

The Bank’s equity consists entirely of issued and fully paid ordinary common stock, with 39.4 million common shares outstanding as of December 31, 2017. At the same date, the Bank’s ratio of total assets to stockholders’ equity was 6.0x and its Tier 1 Basel III Capital Ratio increased to 21.1%, reflecting higher levels of capitalization with risk-weighted assets flat QoQ and down 13% YoY.

RECENT EVENTS

Quarterly dividend payment: At a meeting held January 16, 2018, the Bank’s Board of Directors approved a quarterly common dividend of $0.385 per share corresponding to the fourth quarter 2017. The dividend will be paid on February 21, 2018, to stockholders registered as of February 2, 2018.

Notes:

Numbers and percentages set forth in this earnings release have been rounded and accordingly may not total exactly.

QoQ and YoY refer to quarter-on-quarter and year-on-year variations, respectively.

Footnotes:

Total operating expenses includes the following expenses line items of the consolidated statements of profit or loss: salaries and other employee expenses, depreciation of equipment and leasehold improvements, amortization of intangible assets, and other expenses.

Earnings per Share (“EPS”) calculation is based on the average number of shares outstanding during each period.

ROAE refers to return on average stockholders’ equity which is calculated on the basis of unaudited daily average balances.

NIM refers to net interest margin which constitutes to net interest income divided by the average balance of interest-earning assets.

NIS refers to net interest spread which constitutes the average yield earned on interest-earning assets, less the average yield paid on interest-bearing liabilities.

Efficiency Ratio refers to consolidated operating expenses as a percentage of total income.

The Bank’s “Commercial Portfolio” includes gross loans (or the “Loan Portfolio”), loan commitments and financial guarantee contracts, such as confirmed and stand-by letters of credit, and guarantees covering commercial risk; and other assets consisting of customers’ liabilities under acceptances.

Market capitalization corresponds to total outstanding common shares multiplied by market close price at the end of each corresponding period.

Tier 1 Capital is calculated according to Basel III capital adequacy guidelines, and is equivalent to stockholders’ equity excluding certain effects such as the OCI effect of the financial instruments at fair value through OCI. Tier 1 Capital ratio is calculated as a percentage of risk-weighted assets. Risk-weighted assets are estimated based on Basel III capital adequacy guidelines.

10)

Liquid assets refer to total cash and cash equivalents, consisting of cash and due from banks, and interest-bearing deposits in banks, excluding pledged deposits and margin calls. Liquidity ratio refers to liquid assets as a percentage of total assets.

11)

Loan Portfolio refers to loans, gross of the allowance for expected credit losses and unearned interest and deferred fess.

12)

Total allowance for ECL refers to allowance for expected credit losses on loans plus allowance for expected credit losses on loan commitments and financial guarantee contracts.

13)

Net other income (loss) by Business Segment consists of the following items:

Commercial Business Segment: net fees and commissions, gain on sale of loans, and net related other income.

Treasury Business Segment: net other income from derivative financial instruments and foreign currency exchange, gain (loss) per financial instruments at fair value through profit or loss, gain (loss) per financial instruments at fair value through OCI, and net related other income.

SAFE HARBOR STATEMENT

This press release contains forward-looking statements of expected future developments. The Bank wishes to ensure that such statements are accompanied by meaningful cautionary statements pursuant to the safe harbor established by the Private Securities Litigation Reform Act of 1995. The forward-looking statements in this press release refer to the growth of the credit portfolio, including the trade portfolio, the increase in the number of the Bank’s corporate clients, the positive trend of lending spreads, the increase in activities engaged in by the Bank that are derived from the Bank’s client base, anticipated operating profit and return on equity in future periods, including income derived from the Treasury Business Segment, the improvement in the financial and performance strength of the Bank and the progress the Bank is making. These forward-looking statements reflect the expectations of the Bank’s management and are based on currently available data; however, actual experience with respect to these factors is subject to future events and uncertainties, which could materially impact the Bank’s expectations. Among the factors that can cause actual performance and results to differ materially are as follows: the anticipated growth of the Bank’s credit portfolio; the continuation of the Bank’s preferred creditor status; the impact of increasing/decreasing interest rates and of the macroeconomic environment in the Region on the Bank’s financial condition; the execution of the Bank’s strategies and initiatives, including its revenue diversification strategy; the adequacy of the Bank’s allowance for expected credit losses; the need for additional allowance for expected credit losses; the Bank’s ability to achieve future growth, to reduce its liquidity levels and increase its leverage; the Bank’s ability to maintain its investment-grade credit ratings; the availability and mix of future sources of funding for the Bank’s lending operations; potential trading losses; the possibility of fraud; and the adequacy of the Bank’s sources of liquidity to replace deposit withdrawals.

ABOUT BLADEX

Bladex, a multinational bank originally established by the central banks of Latin-American and Caribbean countries, initiated operations in 1979 to promote foreign trade finance and economic integration in the Region. The Bank, headquartered in Panama, operates throughout the Region with offices in Argentina, Brazil, Colombia, Mexico, Peru, and the United States of America, to support the expansion and servicing of its client base, which includes financial institutions and corporations. Through December 31, 2017, Bladex had disbursed accumulated credits of approximately $258 billion.

Bladex is listed on the NYSE in the United States of America (NYSE: BLX), since 1992, and its shareholders include central banks, state-owned banks and entities representing 23 Latin American countries, as well as commercial banks and financial institutions, institutional and retail investors through its public listing.

CONFERENCE CALL INFORMATION

There will be a conference call to discuss the Bank’s quarterly results on Friday, February 9, 2018 at 11:00 a.m. New York City time (Eastern Time). For those interested in participating, please dial (800) 311-9401 in the United States or, if outside the United States, (334) 323-7224. Participants should use conference ID# 8034, and dial in five minutes before the call is set to begin. There will also be a live audio webcast of the conference at http://www.bladex.com. The webcast presentation is available for viewing and downloads on http://www.bladex.com.

The conference call will become available for review on Conference Replay one hour after its conclusion, and will remain available for 60 days. Please dial (877) 919-4059 or (334) 323-0140, and follow the instructions. The replay passcode is: 97587848.

For more information, please access http://www.bladex.com or contact:

Mrs. Ana Graciela de Méndez

Chief Financial Officer

Tel: +507 210-8563

E-mail address: amendez@bladex.com

Mrs. Irma Garrido Arango

SVP, Corporate Development and Investor Relations

Tel: +507 210-8559

E-mail address: igarrido@bladex.com

Bladex

Business Park Torre V, Piso 5

Avenida La Rotonda, Urbanización Costa del Este

Panama City, Panama

EXHIBIT I

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

	AT THE END OF,
	(A)			(B)			(C)			(A) - (B)						(A) - (C)
	December 31, 2017			September 30, 2017			December 31, 2016			CHANGE			%			CHANGE			%
	(In US$ thousand)

ASSETS:
Cash and cash equivalents	$	672,048		$	799,435		$	1,069,538		$	(127,387	)		(16	)%	$	(397,490	)		(37	)%
Financial Instruments:
At fair value through OCI		25,135			16,796			30,607			8,339			50			(5,472	)		(18	)
Securities held-to-maturity, net		68,934			70,697			77,214			(1,763	)		(2	)		(8,280	)		(11	)
Loans		5,505,658			5,343,191			6,020,731			162,467			3			(515,073	)		(9	)
Less:
Allowance for expected credit losses		81,294			111,728			105,988			(30,434	)		(27	)		(24,694	)		(23	)
Unearned interest and deferred fees		4,985			5,838			7,249			(853	)		(15	)		(2,264	)		(31	)
Loans, net		5,419,379			5,225,625			5,907,494			193,754			4			(488,115	)		(8	)

Derivative financial instruments used for hedging – receivable		13,338			11,034			9,352			2,304			21			3,986			43

Property and equipment, net		7,420			7,849			8,549			(429	)		(5	)		(1,129	)		(13	)
Intangibles, net		5,425			2,368			2,909			3,057			129			2,516			86

Other assets:
Customers' liabilities under acceptances		6,369			4,902			19,387			1,467			30			(13,018	)		(67	)
Accrued interest receivable		30,872			32,869			44,187			(1,997	)		(6	)		(13,315	)		(30	)
Other assets		24,834			28,545			11,546			(3,711	)		(13	)		13,288			115
Total of other assets		62,075			66,316			75,120			(4,241	)		(6	)		(13,045	)		(17	)

TOTAL ASSETS	$	6,273,754		$	6,200,120		$	7,180,783		$	73,634			1	%	$	(907,029	)		(13	)%

LIABILITIES AND STOCKHOLDERS' EQUITY:
Deposits:
Demand	$	82,064		$	205,133		$	127,014		$	(123,069	)		(60	)%	$	(44,950	)		(35	)%
Time		2,846,780			2,797,876			2,675,838			48,904			2			170,942			6
Total deposits		2,928,844			3,003,009			2,802,852			(74,165	)		(2	)		125,992			4

Derivative financial instruments used for hedging – payable		34,943			25,617			59,686			9,326			36			(24,743	)		(41	)

Financial liabilities at fair value through profit or loss		0			0			24			0			n.m.	(*)		(24	)		(100	)
Short-term borrowings and debt		1,072,723			737,129			1,470,075			335,594			46			(397,352	)		(27	)
Long-term borrowings and debt, net		1,138,844			1,357,796			1,776,738			(218,952	)		(16	)		(637,894	)		(36	)

Other liabilities:
Acceptances outstanding		6,369			4,902			19,387			1,467			30			(13,018	)		(67	)
Accrued interest payable		15,816			18,191			16,603			(2,375	)		(13	)		(787	)		(5	)
Allowance for expected credit losses on loan commitments and financial guarantee contracts		6,845			4,830			5,776			2,015			42			1,069			19
Other liabilities		26,558			16,907			18,328			9,651			57			8,230			45
Total other liabilities		55,588			44,830			60,094			10,758			24			(4,506	)		(7	)

TOTAL LIABILITIES	$	5,230,942		$	5,168,381		$	6,169,469		$	62,561			1	%	$	(938,527	)		(15	)%

STOCKHOLDERS' EQUITY:
Common stock		279,980			279,980			279,980			0			0	%		0			0	%
Treasury stock		(63,248	)		(64,667	)		(69,176	)		1,419			(2	)		5,928			(9	)
Additional paid-in capital in excess of assigned value of common stock		119,941			119,436			120,594			505			0			(653	)		(1	)
Capital reserves		95,210			95,210			95,210			0			0			0			0
Retained earnings		610,516			603,523			587,507			6,993			1			23,009			4
Accumulated other comprehensive loss		413			(1,743	)		(2,801	)		2,156			(124	)		3,214			(115	)

TOTAL STOCKHOLDERS' EQUITY	$	1,042,812		$	1,031,739		$	1,011,314		$	11,073			1	%	$	31,498			3	%

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	6,273,754		$	6,200,120		$	7,180,783		$	73,634			1	%	$	(907,029	)		(13	)%

(*)

"n.m." means not meaningful.

EXHIBIT II

CONSOLIDATED STATEMENTS OF PROFIT OR LOSS

(In US$ thousand, except per share amounts and ratios)

	FOR THE THREE MONTHS ENDED
	(A)			(B)			(C)			(A) - (B)						(A) - (C)
	December 31, 2017			September 30, 2017			December 31, 2016			CHANGE			%			CHANGE			%

NET INTEREST INCOME:
Interest income	$	55,799		$	55,050		$	61,450		$	749			1	%	$	(5,651	)		(9	)%
Interest expense		(27,658	)		(27,153	)		(23,765	)		(505	)		2			(3,893	)		16

NET INTEREST INCOME		28,141			27,897			37,685			244			1			(9,544	)		(25	)

OTHER INCOME:
Fees and commissions, net		5,666			3,566			4,128			2,100			59			1,538			37
Derivative financial instruments and foreign currency exchange		(425	)		(616	)		(351	)		191			(31	)		(74	)		21
(Loss) Gain per financial instrument at fair value through profit or loss		(26	)		3			1,208			(29	)		(967	)		(1,234	)		(102	)
Gain (Loss) per financial instrument at fair value through OCI		170			0			(110	)		170			n.m.	(*)		280			(255	)
Gain on sale of loans		68			15			316			53			353			(248	)		(78	)
Other income		913			201			321			712			354			592			184
NET OTHER INCOME		6,366			3,169			5,512			3,197			101			854			15

TOTAL INCOME		34,507			31,066			43,197			3,441			11			(8,690	)		(20	)

EXPENSES:
(Recovery) Impairment loss from expected credit losses on loans		(1,122	)		362			17,574			(1,484	)		(410	)		(18,696	)		(106	)
(Recovery) Impairment loss from expected credit losses on investment securities		(99	)		75			(273	)		(174	)		(232	)		174			(64	)
Impairment loss from expected credit losses on loan commitments and financial guarantee contracts		2,015			215			410			1,800			837			1,605			391
OPERATING EXPENSES:
Salaries and other employee expenses		7,347			5,842			6,188			1,505			26			1,159			19
Depreciation of equipment and leasehold improvements		407			384			404			23			6			3			1
Amortization of intangible assets		285			174			218			111			64			67			31
Other expenses		5,075			3,553			5,332			1,522			43			(257	)		(5	)
TOTAL OPERATING EXPENSES		13,114			9,953			12,142			3,161			32			972			8
TOTAL EXPENSES		13,908			10,605			29,853			3,303			31			(15,945	)		(53	)

PROFIT FOR THE PERIOD	$	20,599		$	20,461		$	13,344		$	138			1	%	$	7,255			54	%

PER COMMON SHARE DATA:
Basic earnings per share		0.52			0.52			0.34
Diluted earnings per share		0.52			0.52			0.34

Weighted average basic shares		39,375			39,362			39,160
Weighted average diluted shares		39,408			39,413			39,310

PERFORMANCE RATIOS:
Return on average assets		1.31	%		1.30	%		0.73	%
Return on average stockholders' equity		7.9	%		7.9	%		5.3	%
Net interest margin		1.78	%		1.76	%		2.05	%
Net interest spread		1.38	%		1.37	%		1.79	%
Efficiency Ratio		38.0	%		32.0	%		28.1	%
Operating expenses to total average assets		0.83	%		0.63	%		0.66	%

(*)

"n.m." means not meaningful.

EXHIBIT III

SUMMARY OF CONSOLIDATED FINANCIAL DATA

(Consolidated Statements of Profit or Loss, Financial Position, and Selected Financial Ratios)

	FOR THE YEAR ENDED
	December 31, 2017			December 31, 2016
	(In US$ thousand, except per share amounts & ratios)

PROFIT OR LOSS DATA:
Net interest income	$	119,815		$	155,209
Fees and commissions, net		17,514			14,306
Derivative financial instruments and foreign currency exchange		(437	)		(486	)
(Loss) Gain per financial instrument at fair value through profit or loss		(732	)		(2,883	)
Gain (Loss) per financial instrument at fair value through OCI		249			(356	)
Gain on sale of loans		181			806
Other income		1,723			1,378
Impairment loss from expected credit losses on loans and loan commitments and financial guarantee contracts		(9,928	)		(35,112	)
Recovery (Impairment) loss from expected credit losses on investment securities		489			(3	)
Operating expenses		(46,875	)		(45,814	)
PROFIT FOR THE PERIOD	$	81,999		$	87,045

FINANCIAL POSITION DATA:
Financial instruments at fair value through OCI		25,135			30,607
Securities held-to-maturity, net		68,934			77,214
Loans		5,505,658			6,020,731
Total assets		6,273,754			7,180,783
Deposits		2,928,844			2,802,852
Short-term borrowings and debt		1,072,723			1,470,075
Long-term borrowings and debt, net		1,138,844			1,776,738
Total liabilities		5,230,942			6,169,469
Stockholders' equity		1,042,812			1,011,314

PER COMMON SHARE DATA:
Basic earnings per share		2.09			2.23
Diluted earnings per share		2.08			2.22
Book value (period average)		26.00			25.42
Book value (period end)		26.45			25.83

(In thousand):
Weighted average basic shares		39,311			39,085
Weighted average diluted shares		39,329			39,210
Basic shares period end		39,429			39,160

SELECTED FINANCIAL RATIOS:
PERFORMANCE RATIOS:
Return on average assets		1.27	%		1.16	%
Return on average stockholders' equity		8.0	%		8.8	%
Net interest margin		1.85	%		2.08	%
Net interest spread		1.48	%		1.84	%
Efficiency Ratio		33.9	%		27.3	%
Operating expenses to total average assets		0.72	%		0.61	%

ASSET QUALITY RATIOS:
Non-performing loans to gross loan portfolio		1.07	%		1.09	%
Write-offs to gross loan portfolio		0.61	%		0.31	%
Allowance for expected credit losses on loans to gross loan portfolio		1.48	%		1.76	%
Allowance for expected credit losses on loan commitments and financial guarantee contracts to total loan commitments, financial guarantee contracts and other assets portfolio		1.39	%		1.37	%
Total allowance for expected credit losses on loans, loan commitments and financial guarantee contracts to non-performing loans		150	%		171	%

CAPITAL RATIOS:
Stockholders' equity to total assets		16.6	%		14.1	%
Tier 1 Basel III Capital Ratio		21.1	%		17.9	%

EXHIBIT IV

CONSOLIDATED STATEMENTS OF PROFIT OR LOSS

	FOR THE YEAR ENDED
	(A)			(B)			(A) - (B)
	December 31, 2017			December 31, 2016			CHANGE			%
	(In US$ thousand)
NET INTEREST INCOME:
Interest income	$	226,079		$	245,898		$	(19,819	)		(8	)%
Interest expense		(106,264	)		(90,689	)		(15,575	)		17

NET INTEREST INCOME		119,815			155,209			(35,394	)		(23	)

OTHER INCOME:
Fees and commissions, net		17,514			14,306			3,208			22
Derivative financial instruments and foreign currency exchange		(437	)		(486	)		49			(10	)
(Loss) Gain per financial instrument at fair value through profit or loss		(732	)		(2,883	)		2,151			(75	)
Gain (Loss) per financial instrument at fair value through OCI		249			(356	)		605			(170	)
Gain on sale of loans		181			806			(625	)		(78	)
Other income		1,723			1,378			345			25
NET OTHER INCOME		18,498			12,765			5,733			45

TOTAL INCOME		138,313			167,974			(29,661	)		(18	)

EXPENSES:
Impairment loss from expected credit losses on loans		8,859			34,760			(25,901	)		(75	)
(Recovery) Impairment loss from expected credit losses on investment securities		(489	)		3			(492	)		n.m.	(*)
Impairment loss from expected credit losses on loan commitments and financial guarantee contracts		1,069			352			717			204
OPERATING EXPENSES:
Salaries and other employee expenses		27,653			25,196			2,457			10
Depreciation of equipment and leasehold improvements		1,578			1,457			121			8
Amortization of intangible assets		838			629			209			33
Other expenses		16,806			18,532			(1,726	)		(9	)
TOTAL OPERATING EXPENSES		46,875			45,814			1,061			2
TOTAL EXPENSES		56,314			80,929			(24,615	)		(30	)

PROFIT FOR THE PERIOD	$	81,999		$	87,045		$	(5,046	)		(6	)%

(*)

"n.m." means not meaningful.

EXHIBIT V

CONSOLIDATED NET INTEREST INCOME AND AVERAGE BALANCES

	FOR THE THREE MONTHS ENDED
	December 31, 2017								September 30, 2017								December 31, 2016
	AVERAGE					AVG.			AVERAGE					AVG.			AVERAGE					AVG.
	BALANCE			INTEREST		RATE			BALANCE			INTEREST		RATE			BALANCE			INTEREST		RATE
	(In US$ thousand)

INTEREST EARNING ASSETS
Cash and cash equivalents	$	730,965		$	2,444		1.31	%	$	798,466		$	2,995		1.47	%	$	868,855		$	1,266		0.57	%
Financial Instruments at fair value through profit or loss		0			0		0.00			1			0		0.00			1			0		0.00
Financial Instruments at fair value through OCI		16,771			125		2.91			16,823			124		2.89			47,294			298		2.47
Securities held-to-maturity ⁽¹⁾		69,446			499		2.81			66,623			474		2.78			79,279			520		2.57
Loans, net of unearned interest		5,454,016			52,732		3.78			5,389,948			51,457		3.74			6,314,717			59,366		3.68

TOTAL INTEREST EARNING ASSETS	$	6,271,198		$	55,799		3.48	%	$	6,271,861		$	55,050		3.43	%	$	7,310,146		$	61,450		3.29	%

Allowance for expected credit losses on loans		(107,679	)							(115,631	)							(99,405	)
Non interest earning assets		94,884								86,060								94,316

TOTAL ASSETS	$	6,258,402							$	6,242,290							$	7,305,056

INTEREST BEARING LIABILITIES
Deposits	$	3,210,409		$	12,537		1.53	%	$	3,301,112		$	12,510		1.48	%	$	3,067,574		$	5,160		0.66	%
Trading liabilities		3			0		0.00			6			0		0.00			(117	)		0		0.00
Securities sold under repurchase agreement and short-term borrowings and debt		717,956			3,704		2.02			446,652			2,209		1.94			1,325,850			4,298		1.27
Long-term borrowings and debt, net ⁽²⁾		1,214,190			11,418		3.68			1,398,233			12,434		3.48			1,805,004			14,306		3.10

TOTAL INTEREST BEARING LIABILITIES	$	5,142,557		$	27,659		2.10	%	$	5,146,003		$	27,153		2.06	%	$	6,198,311		$	23,765		1.50	%

Non interest bearing liabilities and other liabilities	$	83,694							$	72,152							$	97,157

TOTAL LIABILITIES		5,226,251								5,218,155								6,295,468

STOCKHOLDERS' EQUITY		1,032,151								1,024,134								1,009,589

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	6,258,402							$	6,242,290							$	7,305,056

NET INTEREST SPREAD							1.38	%							1.37	%							1.79	%

NET INTEREST INCOME AND NET INTEREST MARGIN				$	28,140		1.78	%				$	27,897		1.76	%				$	37,685		2.05	%

⁽¹⁾

Gross of the allowance for expected credit losses relating to securities held-to-maturity.

⁽²⁾

Net of prepaid commissions.

Note: Interest income and/or expense includes the effect of derivative financial instruments used for hedging.

EXHIBIT VI

CONSOLIDATED NET INTEREST INCOME AND AVERAGE BALANCES

	FOR THE YEAR ENDED
	December 31, 2017								December 31, 2016
	AVERAGE					AVG.			AVERAGE					AVG.
	BALANCE			INTEREST		RATE			BALANCE			INTEREST		RATE
	(In US$ thousand)

INTEREST EARNING ASSETS
Cash and cash equivalents	$	908,661		$	10,261		1.11	%	$	844,801		$	4,472		0.52	%
Financial Instruments at fair value through profit or loss		0			0		0.00			16,081			0		0.00
Financial Instruments at fair value through OCI		19,175			545		2.80			97,602			2,254		2.27
Securities held-to-maturity ⁽¹⁾		67,678			1,947		2.84			99,542			2,780		2.75
Loans, net of unearned interest		5,498,246			213,326		3.83			6,421,069			236,392		3.62

TOTAL INTEREST EARNING ASSETS	$	6,493,759		$	226,079		3.43	%	$	7,479,095		$	245,898		3.23	%

Allowance for expected credit losses on loans		(109,983	)							(95,865	)
Non interest earning assets		84,613								96,146

TOTAL ASSETS	$	6,468,390							$	7,479,376

INTEREST BEARING LIABILITIES
Deposits	$	3,176,175		$	42,847		1.33	%	$	3,080,289		$	20,131		0.64	%
Trading liabilities		22			0		0.00			(25	)		0		0.00
Securities sold under repurchase agreement and short-term borrowings and debt		710,021			11,967		1.66			1,448,642			16,530		1.12
Long-term borrowings and debt, net ⁽²⁾		1,477,788			51,450		3.43			1,874,435			54,028		2.84

TOTAL INTEREST BEARING LIABILITIES	$	5,364,007		$	106,264		1.95	%	$	6,403,342		$	90,689		1.39	%

Non interest bearing liabilities and other liabilities	$	82,185							$	82,513

TOTAL LIABILITIES		5,446,191								6,485,855

STOCKHOLDERS' EQUITY		1,022,199								993,521

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	6,468,390							$	7,479,376

NET INTEREST SPREAD							1.48	%							1.84	%

NET INTEREST INCOME AND NET INTEREST MARGIN				$	119,815		1.85	%				$	155,209		2.08	%

⁽¹⁾

Gross of the allowance for expected credit losses relating to securities held-to-maturity.

⁽²⁾

Net of prepaid commissions.

Note: Interest income and/or expense includes the effect of derivative financial instruments used for hedging.

EXHIBIT VII

CONSOLIDATED STATEMENT OF PROFIT OR LOSS

(In US$ thousand, except per share amounts and ratios)

	FOR THE YEAR			FOR THE THREE MONTHS ENDED															FOR THE YEAR
	ENDED																		ENDED
	DEC 31/17			DEC 31/17			SEP 30/17			JUN 30/17			MAR 31/17			DEC 31/16			DEC 31/16

NET INTEREST INCOME:
Interest income	$	226,079		$	55,799		$	55,050		$	56,099		$	59,131		$	61,450		$	245,898
Interest expense		(106,264	)		(27,658	)		(27,153	)		(26,754	)		(24,699	)		(23,765	)		(90,689	)

NET INTEREST INCOME		119,815			28,141			27,897			29,345			34,432			37,685			155,209

OTHER INCOME:
Fees and commissions, net		17,514			5,666			3,566			5,013			3,269			4,128			14,306
Derivative financial instruments and foreign currency exchange		(437	)		(425	)		(616	)		473			131			(351	)		(486	)
(Loss) Gain per financial instrument at fair value through profit or loss		(732	)		(26	)		3			(649	)		(60	)		1,208			(2,883	)
Gain (Loss) per financial instrument at fair value through OCI		249			170			0			(35	)		114			(110	)		(356	)
Gain on sale of loans		181			68			15			12			86			316			806
Other income		1,723			913			201			255			354			321			1,378

NET OTHER INCOME		18,498			6,366			3,169			5,069			3,894			5,512			12,765

TOTAL INCOME		138,313			34,507			31,066			34,414			38,326			43,197			167,974

Impairment loss from expected credit losses on loans		8,859			(1,122	)		362			5,666			3,953			17,574			34,760
(Recovery) Impairment loss from expected credit losses on investment securities		(489	)		(99	)		75			(11	)		(454	)		(273	)		3
(Recovery) Impairment loss from expected credit losses on loan commitments and financial guarantee contracts		1,069			2,015			215			(1,324	)		163			410			352
Operating expenses		46,875			13,114			9,953			12,602			11,206			12,142			45,814

PROFIT FOR THE PERIOD	$	81,999		$	20,599		$	20,461		$	17,481		$	23,458		$	13,344		$	87,045

SELECTED FINANCIAL DATA

PER COMMON SHARE DATA
Basic earnings per share	$	2.09		$	0.52		$	0.52		$	0.44		$	0.60		$	0.34		$	2.23

PERFORMANCE RATIOS
Return on average assets		1.27	%		1.31	%		1.30	%		1.08	%		1.39	%		0.73	%		1.16	%
Return on average stockholders' equity		8.0	%		7.9	%		7.9	%		6.9	%		9.4	%		5.3	%		8.8	%
Net interest margin		1.85	%		1.78	%		1.76	%		1.80	%		2.02	%		2.05	%		2.08	%
Net interest spread		1.48	%		1.38	%		1.37	%		1.44	%		1.71	%		1.79	%		1.84	%
Efficiency Ratio		33.9	%		38.0	%		32.0	%		36.6	%		29.2	%		28.1	%		27.3	%
Operating expenses to total average assets		0.72	%		0.83	%		0.63	%		0.78	%		0.66	%		0.66	%		0.61	%

EXHIBIT VIII

BUSINESS SEGMENT ANALYSIS

(In US$ thousand)

	FOR THE YEAR ENDED						FOR THE THREE MONTHS ENDED
	DEC 31/17			DEC 31/16			DEC 31/17			SEP 30/17			DEC 31/16

COMMERCIAL BUSINESS SEGMENT:

Net interest income ⁽¹⁾	$	120,581		$	140,375		$	28,933		$	28,333		$	34,994
Net other income ⁽²⁾		18,926			16,333			6,516			3,723			4,701
Total income		139,507			156,708			35,449			32,056			39,695
Impairment loss from expected credit losses on loans, loan commitments and financial guarantee contracts		(9,928	)		(35,112	)		(893	)		(577	)		(17,984	)
Operating expenses ⁽³⁾		(35,916	)		(34,598	)		(9,699	)		(7,723	)		(9,187	)

PROFIT FOR THE PERIOD	$	93,663		$	86,998		$	24,857		$	23,756		$	12,524

Average interest-earning assets ⁽⁴⁾		5,498,246			6,421,069			5,454,016			5,389,948			6,314,717
End-of-period interest-earning assets ⁽⁴⁾		5,500,673			6,013,482			5,500,673			5,337,353			6,013,482

TREASURY BUSINESS SEGMENT:

Net interest income ⁽¹⁾	$	(766	)	$	14,834		$	(792	)	$	(436	)	$	2,691
Net other loss ⁽²⁾		(428	)		(3,568	)		(150	)		(554	)		811
Total income (loss)		(1,194	)		11,266			(942	)		(990	)		3,502
Recovery (Impairment) loss from expected credit losses on investment securities		489			(3	)		99			(75	)		273
Operating expenses ⁽³⁾		(10,959	)		(11,216	)		(3,415	)		(2,230	)		(2,955	)

(LOSS) PROFIT FOR THE PERIOD	$	(11,664	)	$	47		$	(4,258	)	$	(3,295	)	$	820

Average interest-earning assets ⁽⁵⁾		995,514			1,058,026			817,182			881,913			995,429
End-of-period interest-earning assets ⁽⁵⁾		757,912			1,177,961			757,912			887,149			1,177,961

COMBINED BUSINESS SEGMENT TOTAL:

Net interest income ⁽¹⁾	$	119,815		$	155,209		$	28,141		$	27,897		$	37,685
Net other income ⁽²⁾		18,498			12,765			6,366			3,169			5,512
Total income		138,313			167,974			34,507			31,066			43,197
Impairment loss from expected credit losses on loans, loan commitments and financial guarantee contracts		(9,928	)		(35,112	)		(893	)		(577	)		(17,984	)
Recovery (Impairment) loss from expected credit losses on investment securities		489			(3	)		99			(75	)		273
Operating expenses ⁽³⁾		(46,875	)		(45,814	)		(13,114	)		(9,953	)		(12,142	)

PROFIT FOR THE PERIOD	$	81,999		$	87,045		$	20,599		$	20,461		$	13,344

Average interest-earning assets		6,493,760			7,479,095			6,271,198			6,271,861			7,310,146
End-of-period interest-earning assets		6,258,585			7,191,443			6,258,585			6,224,502			7,191,443

The Bank’s activities are managed and executed in two business segments, Commercial and Treasury. The business segment results are determined based on the Bank’s managerial accounting process as defined by IFRS 8 - Operating Segments, which assigns consolidated statement of financial positions, revenue and expense items to each business segment on a systematic basis.

(1) Interest income on interest-earning assets, net of allocated cost of funds.

(2) Net other income (loss) by Business Segment consists of the following items: - Commercial Business Segment: net fees and commissions, gain on sale of loans, and net related other income. - Treasury Business Segment: net other income from derivative financial instruments and foreign currency exchange, gain (loss) per financial instruments at fair value through profit or loss, gain (loss) per financial instruments at fair value through OCI, and net related other income.

(3) Operating Expenses allocation methodology assigns overhead expenses based on resource consumption by business segment. Total operating expenses includes the following line items of the consolidated statements of profit or loss: salaries and other employee expenses, depreciation of equipment and leasehold improvements, amortization of intangible assets, and other expenses.

(4) Includes loans, net of unearned interest and deferred fees.

(5) Includes cash and cash equivalents, financial instruments at fair value through profit or loss, financial instruments at fair value through OCI and securities held-to-maturity, gross of the allowance for expected credit losses.

EXHIBIT IX

CREDIT PORTFOLIO

DISTRIBUTION BY COUNTRY

(In US$ million)

	AT THE END OF,
	(A)						(B)						(C)
	December 31, 2017						September 30, 2017						December 31, 2016						Change in Amount
COUNTRY ^(*)	Amount			% of Total Outstanding			Amount			% of Total Outstanding			Amount			% of Total Outstanding			(A) - (B)			(A) - (C)

ARGENTINA	$	302			5		$	321			6		$	325			5		$	(19	)	$	(23	)
BELGIUM		11			0			14			0			4			0			(3	)		7
BOLIVIA		15			0			10			0			19			0			5			(4	)
BRAZIL		1,032			17			1,023			18			1,185			18			9			(153	)
CHILE		191			3			214			4			75			1			(23	)		116
COLOMBIA		949			16			734			13			762			12			215			187
COSTA RICA		376			6			415			7			403			6			(39	)		(27	)
DOMINICAN REPUBLIC		250			4			142			2			270			4			108			(20	)
ECUADOR		347			6			307			5			319			5			40			28
EL SALVADOR		56			1			79			1			106			2			(23	)		(50	)
GERMANY		38			1			43			1			50			1			(5	)		(12	)
GUATEMALA		321			5			238			4			323			5			83			(2	)
HONDURAS		75			1			82			1			74			1			(7	)		1
JAMAICA		24			0			14			0			7			0			10			17
MEXICO		906			15			943			16			959			15			(37	)		(53	)
NICARAGUA		30			0			33			1			37			1			(3	)		(7	)
PANAMA		556			9			533			9			552			8			23			4
PARAGUAY		60			1			58			1			108			2			2			(48	)
PERU		229			4			352			6			510			8			(123	)		(281	)
SINGAPORE		55			1			9			0			70			1			46			(15	)
SWITZERLAND		4			0			6			0			47			1			(2	)		(43	)
TRINIDAD & TOBAGO		184			3			166			3			193			3			18			(9	)
UNITED STATES		44			1			23			0			73			1			21			(29	)
URUGUAY		18			0			19			0			55			1			(1	)		(37	)
MULTILATERAL ORGANIZATIONS		0			0			0			0			11			0			0			(11	)
OTHER		20			0			16			0			15			0			4			5

TOTAL CREDIT PORTFOLIO ⁽¹⁾	$	6,093			100	%	$	5,794			100	%	$	6,552			100	%	$	299		$	(459	)

UNEARNED INTEREST AND DEFERRED FEES		(5	)					(6	)					(7	)					1			2

TOTAL CREDIT PORTFOLIO, NET OF UNEARNED INTEREST & DEFERRED FEES	$	6,088					$	5,788					$	6,545					$	300		$	(457	)

⁽¹⁾

Includes gross loans (or the “Loan Portfolio”), financial instruments at fair value through OCI and securities held-to-maturity, gross of the allowance for expected credit losses, loan commitments and financial guarantee contracts, such as confirmed and stand-by letters of credit, and guarantees covering commercial risk; and other assets consisting of customers’ liabilities under acceptances.

^(*)

Risk in countries outside the Region related to transactions carried out in the Region.

EXHIBIT X

COMMERCIAL PORTFOLIO

DISTRIBUTION BY COUNTRY

(In US$ million)

	AT THE END OF,
	(A)						(B)						(C)
	December 31, 2017						September 30, 2017						December 31, 2016						Change in Amount
COUNTRY ^(*)	Amount			% of Total Outstanding			Amount			% of Total Outstanding			Amount			% of Total Outstanding			(A) - (B)			(A) - (C)

ARGENTINA	$	302			5		$	321			6		$	325			5		$	(19	)	$	(23	)
BELGIUM		11			0			14			0			4			0			(3	)		7
BOLIVIA		15			0			10			0			19			0			5			(4	)
BRAZIL		1,019			17			1,015			18			1,164			18			4			(145	)
CHILE		186			3			209			4			70			1			(23	)		116
COLOMBIA		920			15			705			12			732			11			215			188
COSTA RICA		376			6			415			7			403			6			(39	)		(27	)
DOMINICAN REPUBLIC		250			4			142			2			270			4			108			(20	)
ECUADOR		347			6			307			5			319			5			40			28
EL SALVADOR		56			1			79			1			106			2			(23	)		(50	)
GERMANY		38			1			43			1			50			1			(5	)		(12	)
GUATEMALA		321			5			238			4			323			5			83			(2	)
HONDURAS		75			1			82			1			74			1			(7	)		1
JAMAICA		24			0			14			0			7			0			10			17
MEXICO		886			15			923			16			939			15			(37	)		(53	)
NICARAGUA		30			0			33			1			37			1			(3	)		(7	)
PANAMA		538			9			516			9			540			8			22			(2	)
PARAGUAY		60			1			58			1			108			2			2			(48	)
PERU		229			4			352			6			510			8			(123	)		(281	)
SINGAPORE		55			1			9			0			70			1			46			(15	)
SWITZERLAND		4			0			6			0			47			1			(2	)		(43	)
TRINIDAD & TOBAGO		175			3			157			3			184			3			18			(9	)
UNITED STATES		44			1			23			0			73			1			21			(29	)
URUGUAY		18			0			19			0			55			1			(1	)		(37	)
OTHER		20			0			16			0			15			0			4			5

TOTAL COMMERCIAL PORTFOLIO ⁽¹⁾	$	5,999			100	%	$	5,706			100	%	$	6,444			100	%	$	293		$	(445	)

UNEARNED INTEREST AND DEFERRED FEES		(5	)					(6	)					(7	)					1			2

TOTAL COMMERCIAL PORTFOLIO, NET OF UNEARNED INTEREST & DEFERRED FEES	$	5,994					$	5,700					$	6,437					$	294		$	(443	)

⁽¹⁾

Includes gross loans (or the “Loan Portfolio”), loan commitments and financial guarantee contracts, such as confirmed and stand-by letters of credit, and guarantees covering commercial risk; and other assets consisting of customers’ liabilities under acceptances.

^(*)

Risk in countries outside the Region related to transactions carried out in the Region.

EXHIBIT XI

TREASURY PORTFOLIO

DISTRIBUTION BY COUNTRY

(In US$ million)

	AT THE END OF,
	(A)					(B)					(C)
	December 31, 2017					September 30, 2017					December 31, 2016					Change in Amount
COUNTRY	Amount		% of Total Outstanding			Amount		% of Total Outstanding			Amount		% of Total Outstanding			(A) - (B)		(A) - (C)

BRAZIL	$	13		14		$	8		9		$	21		20		$	5	$	(8	)
CHILE		5		5			5		6			5		5			0		0
COLOMBIA		29		31			29		33			30		27			0		(1	)
MEXICO		20		21			20		23			20		19			0		0
PANAMA		18		20			17		19			12		11			1		6
TRINIDAD & TOBAGO		9		9			9		10			9		8			0		0
MULTILATERAL ORGANIZATIONS		0		0			0		0			11		10			0		(11	)

TOTAL TREASURY PORTOFOLIO ⁽¹⁾	$	94		100	%	$	88		100	%	$	108		100	%	$	6	$	(14	)

⁽¹⁾

Includes financial instruments at fair value through OCI and securities held-to-maturity, gross of the allowance for expected credit losses.

EXHIBIT XII

CREDIT DISBURSEMENTS

DISTRIBUTION BY COUNTRY

(In US$ million)

	FULL-YEAR				QUARTERLY						Change in Amount
	(A)		(B)		(C)		(D)		(E)
COUNTRY ^(*)	2017		2016		4Q17		3Q17		4Q16		(A) - (B)			(C) - (D)			(C) - (E)

ARGENTINA	$	432	$	468	$	112	$	181	$	174	$	(36	)	$	(69	)	$	(62	)
BELGIUM		12		36		2		1		4		(24	)		1			(2	)
BOLIVIA		17		26		5		10		4		(9	)		(5	)		1
BRAZIL		954		467		367		219		208		487			148			159
CHILE		479		362		130		45		59		117			85			71
COLOMBIA		1,472		1,062		492		366		321		410			126			171
COSTA RICA		686		714		141		223		202		(28	)		(82	)		(61	)
DOMINICAN REPUBLIC		750		739		209		181		180		11			28			29
ECUADOR		1,334		853		339		334		256		481			5			83
EL SALVADOR		128		148		23		25		49		(20	)		(2	)		(26	)
GERMANY		0		100		0		0		0		(100	)		0			0
GUATEMALA		608		680		178		146		148		(72	)		32			30
HONDURAS		137		161		28		48		36		(24	)		(20	)		(8	)
JAMAICA		192		110		52		14		7		82			38			45
MEXICO		4,586		2,831		1,210		1,244		965		1,755			(34	)		245
NETHERLANDS		16		14		0		0		0		2			0			0
NICARAGUA		71		63		24		6		19		8			18			5
PANAMA		911		920		229		242		270		(9	)		(13	)		(41	)
PARAGUAY		48		98		30		6		10		(50	)		24			20
PERU		985		1,186		231		135		294		(201	)		96			(63	)
SINGAPORE		192		217		57		20		59		(25	)		37			(2	)
SWITZERLAND		6		129		0		6		27		(123	)		(6	)		(27	)
TRINIDAD & TOBAGO		384		432		52		153		166		(48	)		(101	)		(114	)
UNITED STATES		104		118		26		0		35		(14	)		26			(9	)
URUGUAY		80		32		3		0		32		48			3			(29	)
OTHER		41		31		15		8		6		10			7			9

TOTAL CREDIT DISBURSED ⁽¹⁾	$	14,625	$	11,997	$	3,955	$	3,613	$	3,531	$	2,628		$	342		$	424

⁽¹⁾

Includes gross loan portfolio, financial instruments at fair value through OCI and securities held-to-maturity, gross of the allowance for expected credit losses, loan commitments and financial guarantee contracts (including confirmed and stand-by letters of credit, and guarantees covering commercial risk).

^(*)

Risk in countries outside the Region related to transactions carried out in the Region.