BCH Drops 1.35% Today as Loan Expansion Slows and Profitability Faces Challenges
- BCH fell 1.35% in 24 hours amid weak loan growth and reduced inflation adjustment income, with 60% revenue tied to net interest income. - Institutional holdings rose 12.75% but shares held dropped 3.53%, as Bridge Builder increased exposure while Baillie Gifford cut holdings by 289.93%. - Goldman Sachs maintains Neutral rating with 0.70% upside, while backtesting shows mixed post-earnings performance with limited statistical significance from two data points.
As of November 14, 2025,
Morningstar expressed concerns about Banco de Chile’s earnings, pointing to slower growth caused by lower inflation adjustment income and sluggish loan expansion. The bank operates under three separate brands—Banco de Chile, Banco Edwards-Citi, and Banco CrediChile—and ranks as the country’s second-largest lender by loan volume and third by deposit size. Nearly 60% of its income comes from net interest, mainly from mortgages, unsecured consumer loans, and business lending. Notably, 25% of its outstanding loans are to companies generating over 10,000 million CLP in annual revenue.
Goldman Sachs has maintained its Neutral rating on BCH, noting a slight 0.70% potential upside based on the consensus one-year price target of $36.93 per share. Analyst estimates range between $36.54 and $38.04. Institutional ownership trends are mixed: the number of funds or institutions holding BCH grew by 12.75% last quarter, with an average portfolio allocation of 0.13%. However, the total number of institutional shares dropped by 3.53% to 14.6 million. The put/call ratio is at 4.11, indicating a bearish sentiment among market participants.
Several major institutional investors adjusted their BCH positions. Bridge Builder International Equity Fund raised its holdings by 14.87% and increased its portfolio allocation by 23.75%. Conversely, Renaissance Technologies cut its stake by 5.10% and reduced its allocation by 3.96%. Baillie Gifford made a substantial reduction, decreasing its share count by 289.93% and its portfolio allocation by 91.16%.
Backtest Hypothesis
A backtesting approach was designed to assess the performance of
Key findings indicate that the average cumulative excess return became positive after about 10 trading days, reaching a peak of roughly +11% compared to the benchmark by day 29. However, this strong result was mainly influenced by a single event, highlighting the limited reliability of conclusions drawn from just two data points. Analysts advise that these results are preliminary, and that more data or different parameters—such as shorter analysis windows or surprise factors—may yield more dependable conclusions.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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