Banorte Reports First-Quarter Profit Increase

MEXICO CITY (Reuters) – Mexican lender Banorte reported an 8% increase in first-quarter profits on Tuesday, driven by strong internal demand boosting its loan book growth.

Net profit for the group, which owns one of Mexico’s largest banks and pension funds, reached 15.29 billion pesos ($747.3 million) for the quarter, slightly above the LSEG estimate of 15.04 billion pesos.

Net interest income, reflecting the difference between earnings on loans and payments on deposits, increased by 4% year-over-year due to a larger loan book despite lower interest rates, according to Banorte.

In March, Mexico’s central bank lowered its benchmark rate to the lowest level since September 2022 with a 50-basis-point cut, pointing to easing price pressures while cautioning about trade tension uncertainties.

Banorte’s loan book expanded by 13% year-over-year, marking the highest growth in the corporate sector.

Revenues for the firm rose by 10% in the quarter to 40.58 billion pesos, also exceeding the LSEG estimate of 39.89 billion pesos.

Return on equity increased significantly, rising 136 basis points year-over-year to 23.4%.

However, non-financial expenses grew by 11% compared to the previous year, as Banorte focused on growth initiatives, notably its digital bank, Bineo, which reported a net loss of 289 million pesos in the quarter.

($1 = 20.4604 pesos at end-March)