SAO PAULO: Chilean Itau Corpbanca is unlikely to post profit and pay dividends in 2020 after taking a $930 million impairment charge, its Chief Executive Gabriel Moura said on Friday in a conference call with analysts.
On Thursday, the bank said the impairment reflected the new fair value of cash generation for units in Chile and Colombia. "This impairment is primarily the result of economic conditions as of June 30, 2020," CorpBanca said.
Moura said that due to the coronavirus pandemic, the Chilean unit of Brazil's biggest lender Itau Unibanco Holding SA Corpbanca is likely to post lower-than-expected loan book and fee growth.
This asset impairment underscores Itau's challenges in building a Latin America retail footprint. Itaú merged with Chilean Corpbanca in 2016. The combined entity has operations in Chile, Colombia, Peru and Panama.
Since the acquisition, Itau has faced an integration that took longer than expected, loan losses, weak profitability and violent protests in Chile.
Itau Corpbanca ended March with $45 billion in assets and 321 branches.