Historic ROE, a Carry-Trade Windfall, and an El Niño Watch
Grupo Cibest's record 28.7% quarterly ROE is flattered by one-offs, but the upgrade of sustainable ROE to 'above 20%' — plus Nequi's standalone debut and fresh El Niño and earthquake risks — makes this a genuine inflection.
CIB · Earnings Call · 2026-08-11
A Headline Number With Real Muscle
Grupo Cibest — the holding company that succeeded Bancolombia a little over a year ago — reported what management calls a historic quarter. Net income reached COP 2.7 trillion, “supported by a NIM close to 8%, solid asset quality that kept cost of risk at 1.6% and continued efficiency gains. Together, these factors drove a historic quarterly ROE of 28.7%.” — Juan Uribe, Executive (likely CEO or senior management) · 2026-08-11 The loan book was flat quarter-on-quarter on election uncertainty, but grew 5.7% year-over-year (9.6% net of FX), while deposits grew 7%. The headline deserves scrutiny: a meaningful slice of the beat is one-off. The COP 374 billion wealth tax that dragged Q1 is absent, and the reversal of the provision booked for the rejected extra-tax decree (roughly COP 120 billion) landed in Q2 — exactly as flagged in May: “since the court rejected the extra tax rate on April, that's going to be reversed during the second quarter of the year.” — Juan Uribe, CEO · 2026-05-09 Even ex-one-offs, the operating picture is strong: lending NIM expanded from 7.8% to 8.3%, fee income grew 17.7% year-over-year, the cost-to-income ratio hit 43%, and cost of risk held at 1.6%. Guidance moved up from a 19.5–20% ROE (set in Q1) to 21–22%. More importantly, management redrew what "sustainable" means. “Our sustainable ROE in the future, we think it's going to be between 18% and 20%,” — Juan Uribe, CEO · 2026-05-09 they said three months ago; now, “we firmly believe that we can deliver an ROE above 20% on the long term.” — Juan Uribe, Executive (likely CEO or senior management) · 2026-08-11 The stand-alone Colombian operation posted a 36% ROE, with Central America at 20%.A Carry-Trade Windfall and Nequi's Standalone Debut
Two themes are genuinely new this quarter. The first is the carry trade. Investment NIM jumped from 1.8% to 6.0% as international investors piled into peso instruments — the kind of window that shows up in global keyword flow but is being monetized here with unusual intensity via the investment portfolio. Management is candid the window is temporary, but it is a live, company-specific driver today.The second is Nequi's standalone debut. “Nequi is expected to begin operating as an independent financial entity within Grupo Cibest on September 1, 2026.” — Mauricio Botero Wolff, Executive (likely CFO or senior management) · 2026-08-11 With 18 million monetized users, an 81.6% activity ratio and a COP 2.2 trillion loan book growing 14% quarter-over-quarter, Nequi is the clearest proof the digital strategy is now earnings-relevant — and the Wompi/Wenia stack around it is the growth options portfolio.There is an open window as of today, a carry trade for international investors to participate in the local market... That window should be reduced over time, but it is open as of today, and we're taking advantage of that.
New Risks: El Niño, an Earthquake, and a New Government
The most striking new item on the risk slate is yesterday's earthquake — which struck the day before the call — alongside an el niño event management flags as potentially severe. Both were named alongside FX as the key swing factors for second-half credit costs, and earthquake is a unique local catalyst on top of a rising global-market theme.On top of these sit two strategic moves: the Avista acquisition — 100% of the payroll-lender, a low-risk segment with clear cross-sell and a path to scale across Central America — and the framing of the new government's fiscal adjustment as the primary macro variable, alongside a proposed extraordinary dividend of COP 1.2 trillion. Capital discipline is also getting tighter: management guided the group's double leverage to roughly 105% by year-end against a 120% appetite, with Bancolombia's total solvency expected at 15.3%. The share price has already re-rated — management notes the ATR price is up more than 90% in a year — so the market has partly priced in the story. The net read: the reported ROE is higher than the previous model said was sustainable, and the marginal drivers split between a temporary windfall (carry trade, one-offs) and durable ones (Nequi, fees, efficiency). Whether that mix holds now depends on the tail risks — the earthquake, El Niño, and the fiscal path of the new government. That is the honest tension in an otherwise very strong quarter.The big question is how the risk -- the credit risk is going to behave... There are some factors, including El Nino, that in Colombia creates an effect on no rain, and that could have an effect on inflation. And the other is the yesterday's earthquake...