Accounting Standards Applied in 2025
Santander-Chile is a Chilean bank and maintains its financial books and records in Chilean pesos and prepares its consolidated financial statements in accordance with IFRS as issued by the IASB in order to comply with requirements of the SEC. As required by the General Banking Law, which subjects Chilean banks to the regulatory supervision of the FMC, and which mandates that Chilean banks abide by the accounting standards stipulated by the FMC, our locally filed consolidated financial statements have been prepared in accordance with Chilean Bank GAAP as issued by the FMC. The accounting principles issued by the FMC are substantially similar to IFRS but there are some exceptions, as described in “Item 4. Information on the Company—Differences between IFRS and Chilean Bank GAAP.” Therefore, our locally filed consolidated financial statements have been adjusted according to IFRS as issued by the IASB.
Critical Accounting Policies
Our consolidated financial statements include various estimates and assumptions, including but not limited to the adequacy of the allowance for loan losses, estimates of the fair value of certain financial instruments and the selection of useful lives of certain assets.
We evaluate these estimates and assumptions on an ongoing basis. Management bases its estimates and assumptions on historical experience and on various other factors that it believes to be reasonable under the circumstances. Actual results in future periods could differ from those estimates and assumptions, and if these differences were significant enough, our reported results of operations would be affected materially. We believe that the following are the most critical judgment areas or involve a higher degree of complexity in the application of the accounting policies that currently affect our financial condition and results of operations.
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Allowance for Loan Losses under IFRS 9
The impairment model applies to all financial assets measured at amortized cost and fair value through other comprehensive income (“FVOCI”), including loan commitments and contingent loans. The Bank accounted the expected credit losses (“ECL”) related to financial assets measured at amortized cost and FVOCI as a loss allowance in the statement of financial position and the carrying amount of these assets is stated net of the loss allowance. The ECL related to contingent loans are accounted as a provision in the statement of financial position. For financial assets that are measured at fair value through other comprehensive income, the loss allowance is recognized in other comprehensive income and does not reduce the carrying amount of the financial asset in the statement of financial position. The new model uses a dual measurement approach, under which the loss allowance is measured as either: (a) 12-month expected credit losses or (b) lifetime expected credit losses.
Based on changes in credit quality since initial recognition, IFRS 9 outlines a “three-stage” impairment model as illustrated by the following chart:
Change in credit quality since initial recognition
Stage 1 Stage 2 Stage 3
Initial recognition Significant increase in credit risk since initial recognition Credit impaired assets
12-month expected credit losses Lifetime expected credit losses Lifetime expected credit losses
The Bank, at the end of each reporting period, evaluates whether a financial instrument’s credit risk has increased since initial recognition, and consequently classifies the financial instrument in the relevant stage:
•Stage 1: At initial recognition of a loan or when there has been an improved credit risk following a significant increase or impairment of assets, the Bank recognizes an allowance based on 12 months ECL.
•Stage 2: When a loan has shown a significant increase in credit risk since origination, the Bank records an allowance for the lifetime ECL. Stage 2 loans also include loans where the credit risk has improved following a Stage 3 classification.
•Stage 3: Loans considered credit impaired. The Bank records an allowance for the lifetime ECL, setting the probability of default at 100%.
The Bank considers reasonable and verifiable information available without undue cost or effort to it that may affect the credit risk on a financial instrument, including forward-looking information to determine whether there is or has been a significant increase in credit risk since initial recognition of a loan. Forward-looking information includes past events that affect future performance, current conditions and forecasts of future economic conditions.
Expected credit loss measurement
The ECL is the probability-weighted estimate of credit losses, i.e., the present value of all cash shortfalls. A cash shortfall is the difference between the cash flows that are due to an entity in accordance with the contract and the cash flows that the entity expects to receive. The three main components in measuring ECL are:
•PD: The probability of default is an estimate of the likelihood of default over a given time period. A default may only happen at a certain time over the assessed period, if the facility has not been previously de-recognized and is still in the portfolio.
•LGD: The loss given default is an estimate of the loss arising after a specific default. It is based on the difference between the contractual cash flows due and those that the lender would expect to receive, including from the realization of any collateral.
•EAD: The exposure at default is an estimate of the exposure at a future default date, taking into account expected changes in the exposure after the reporting date, including repayments of principal and interest, whether scheduled by contract or otherwise, expected drawdown on committed facilities and accrued interest from missed payments.
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For measuring 12-month and lifetime expected credit losses, cash shortfalls are identified as follows:
•12-month expected credit losses: the portion of lifetime expected credit losses that represents the expected credit losses that result from default events on the financial instruments that are possible within the 12 months after the reporting date.
•Lifetime expected credit losses: the expected credit losses that result from all possible default events over the expected life of the financial instrument.
Forward-looking information
The ECL model includes a broad range of forward-looking information as economic inputs, such as:
•GDP growth;
•Unemployment rates;
•Central Bank interest rates; and
•Real estate prices.
Interbank loans
According to the balance presentation required under IFRS 9, the Bank has grouped interbank loans with loans and accounts receivable since both are measured at amortized cost and are evaluated together for impairment purposes.
Contingent loans
The Bank enters into various irrevocable loan commitments and contingent liabilities. Even though these obligations may not be recognized on the statement of financial position, they contain credit risk and, therefore, form part of the overall risk of the Bank. When the Bank estimates the ECL for contingent loan commitments and letters of credit, it estimates the expected portion of the loan commitment that will be drawn down over its expected life.
Loans and account receivable measured at fair value through other comprehensive income
When the Bank enters into arrangements with its major customers for project finance and syndicated loans, the amount requested sometimes exceeds the Bank’s limit for single client exposure under credit risk policy, so these operations are approved under the condition that a portion of the loans be sold in the near term. The Bank also has loans that it expects to sell if market conditions are favorable to the Bank. These loans are measured at fair value through other comprehensive income and are subject to impairment requirements.
Valuation of Financial Instruments
Fair value is the price that would be received to sell an asset or that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. IFRS 13 provides a hierarchy that separates the inputs and/or valuation technique assumptions used to measure the fair value of financial instruments. The hierarchy reflects the significance of the inputs used in making the measurement.
The hierarchy gives the highest priority to (unadjusted) quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The Bank uses valuation techniques appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.
For financial instruments with no available market prices, fair values are estimated using recent transactions in analogous instruments, and in the absence thereof, the present values or other valuation techniques based on mathematical valuation models sufficiently accepted by the international financial community. In the use of these models, consideration is given to the specific particularities of the asset or liability to be valued, and especially to the different kinds of risks associated with the asset or liability.
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These techniques are significantly influenced by the assumptions used, including the discount rate, the estimates of future cash flows and prepayment expectations. See “Note 36—Fair Value of Financial Assets and Liabilities” in our Audited Consolidated Financial Statements.
Derivative Activities
Derivatives are measured at fair value on the statement of financial position and the net unrealized gain (loss) on derivatives is classified as a separate line item within the income statement. Under IFRS, banks must mark-to-market derivatives. Within the fair value of derivatives are included Credit Valuation Adjustment (“CVA”) and Debit Valuation Adjustment (“DVA”), all with the objective that the fair value of each instrument includes the credit risk of its counterparty and the Bank’s own risk. The CVA is a valuation adjustment to OTC derivatives as a result of the risk associated with the credit exposure assumed by each counterparty in each future period. The DVA is a valuation adjustment similar to the CVA but, in this case, it arises as a result of the Bank’s own risk assumed by its counterparties. The following inputs are used to calculate the CVA and DVA:
•Expected exposure: Including for each transaction the mark-to-market (MtM) value plus an add-on for the potential future exposure for each period. Mitigating factors such as collateral and netting agreements are taken into account, as well as a temporary impairment factor for derivatives with interim payments.
•LGD: percentage of final loss assumed in a counterparty credit event/default.
•Probability of default: for cases where there is no market information, proxies based on comparable companies in the same industry and with the same external rating as the counterparty, are used.
•Discount factor curve.
Deferred Tax Assets and Liabilities
The Bank records, when appropriate, deferred tax assets and liabilities for the estimated future tax effects attributable to differences between the carrying amount of assets and liabilities and their tax bases. The measurement of deferred tax assets and liabilities is based on the tax rate, in accordance with the applicable tax laws, using the tax rate that applies to the period when the deferred asset and liability will be settled. The future effects of changes in tax legislation or tax rates are recorded in deferred taxes beginning on the date on which the law is enacted or substantially enacted. See “Note 13—Current and Deferred Taxes” of our Audited Consolidated Financial Statements.
Provisions – Contingent Liabilities
Provisions related to contingencies associated to pending signature of contracts, potential clients and other administrative claims, operational risk arise from financial transactions, potential property tax associated to leasing contracts are quantified using the best available information of uncertain future events that are not wholly within control of the Bank. These are reviewed and adjusted at each reporting date. See “Note 19—Provisions and Contingent Provisions” of our Audited Consolidated Financial Statements.
A.Operating Results
Chilean Economy
All of our operations and substantially all of our customers are located in Chile. Accordingly, our financial condition and results of operations are substantially dependent upon economic conditions prevailing in Chile. In 2025, Chile experienced a moderate increase in economic activity compared to the previous year as lower interest rates in Chile and globally drove growth. In 2025, Chile’s economy is expected to grow 2.4% as compared to 2.6% in 2024 and 0.5% in 2023. The Central Bank's reference rate, which is used to set monetary policy, finished 2025 at 4.50% compared to 5.00% in 2024 and 8.25% in 2023. The unemployment rate for 2025 remained elevated at 8.5%. The observed exchange rate appreciated 9.4% in 2025, depreciated 13.7% in 2024 and depreciated 2.9% in 2023. The appreciation of the Chilean peso in 2025 was mainly due to a weaker U.S. dollar globally. Currently, the Central Bank expects GDP to increase in a range between 1.5%-2.5% in 2025.
Total loans as of December 31, 2025, in the Chilean financial system, excluding loans held abroad by Chilean banks, grew 2.6% year-over-year. Total customer deposits (defined as time deposits plus checking accounts), excluding amounts
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held by Chilean banks abroad, increased 5.8% year-over-year as of December 31, 2025. The non-performing loans (defined as loans with an installment that is at least 90 days past-due) to total loans ratio increased from 2.1% as of December 31, 2024 to 2.5% as of December 31, 2025. This was mainly driven by asset quality weakness caused by the sluggish economic growth and high unemployment rates.
The Unidad de Fomento (UF) and the Impact of Inflation
Our assets and liabilities are denominated in Chilean pesos, Unidades de Fomento (UF) and foreign currencies. Inflation impacts our results of operations as some loan and deposit products are contracted in UF. The UF is revalued in monthly cycles. Each day in the period beginning on the tenth day of the current month through the ninth day of the succeeding month, the nominal peso value of the UF is indexed up (or down in the event of deflation) in order to reflect a proportionate amount of the change in the Chilean Consumer Price Index during the prior calendar month. One UF equaled Ch$39,727.96 as of December 31, 2025, Ch$38,416.69 as of December 31, 2024, Ch$36,789.36, and as of December 31, 2023. High levels of inflation in Chile could adversely affect the Chilean economy and could have an adverse effect on our business, financial condition, and results of operations. Negative inflation rates also negatively impact on our results. Inflation measured as the annual variation of the UF was 3.4% in 2025, 4.4% in 2024, and 4.8% in 2023. There can be no assurance that Chilean inflation will not change significantly from the current level. Due to the current structure of our assets and liabilities (i.e., a significant portion of our loans are indexed to the inflation rate compared to our deposits and other funding sources), there can be no assurance that our business, financial condition and result of operations in the future will not be adversely affected by changing levels of inflation. In summary:
•UF-denominated assets and liabilities. The effect of any changes in the nominal peso value of our UF-denominated interest earning assets and interest-bearing liabilities is reflected in our results of operations as an increase (or decrease, in the event of deflation) in interest income and expense, respectively. Our net interest income will be positively affected by an inflationary environment to the extent that our average UF-denominated interest earning assets exceed our average UF-denominated interest-bearing liabilities. Our net interest income will be positively affected by deflation in any period in which our average UF-denominated interest-bearing liabilities exceed our average UF-denominated interest earning assets. Our net interest income will be negatively affected in a deflationary environment if our average UF-denominated interest-earning assets exceed our average UF-denominated interest-bearing liabilities.
•Inflation and interest rate hedge. A key component of our asset and liability policy is the management of interest rate risk. The Bank’s assets generally have a longer maturity than our liabilities. As the Bank’s mortgage portfolio grows, the maturity gap tends to rise as these loans, which are contracted in UF, have a longer maturity than the average maturity of our funding base. As most of our long-term financial instruments and mortgage loans are contracted in UF and most of our deposits are in nominal pesos, the rise in mortgage lending increases the Bank’s exposure to inflation and to interest rate risk. This gap's size is limited by internal and regulatory guidelines to avoid excessive potential losses due to strong shifts in interest rates or inflation. To keep this duration gap below internal and regulatory limits, the Bank issues long term bonds denominated in UF or interest rate swaps. The financial cost of the bonds and the efficient part of these hedges is recorded as net interest income. The loss from the swaps taken to hedge mainly for inflation and interest rate risk, and included in net interest income, totaled a loss of Ch$236,523 in 2025, a loss of Ch$535,558 million in 2024, and a loss of Ch$1,147,193 million in 2023. The lower losses in 2025 were mainly due to lower short-term interest rates and inflation in 2025 compared to 2024. The average gap between our interest earnings assets and total liabilities linked to the inflation, including hedging, was Ch$7,403,454 million in 2025, Ch$7,518,560 million in 2024 and, Ch$6,875,280 million in 2023. Therefore, our sensitivity to a 100-basis point shift in UF inflation considering our average gap in 2025 would be approximately Ch$74 billion.
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The financial impact of the gap between our interest earning assets and liabilities denominated in UFs including hedges was as follows:
As of December 31, % Change
2025 2024 2023 2025/2024 2024/2023
(in millions of Ch$)
Impact of inflation on net interest income
Results from UF GAP(1) 253,849 323,751 321,698 (21.6 %) 0.6 %
Annual UF inflation 3.4 % 4.4 % 4.8 %
(1)UF GAP is net interest income from asset and liabilities denominated in UFs and include the results from hedging the size of this gap via interest rate swaps.
•Peso-denominated assets and liabilities. Interest rates prevailing in Chile during any period primarily reflect the inflation rate during the period and the expectations of future inflation. The sensitivity of our peso-denominated interest earning assets and interest-bearing liabilities to changes to such prevailing rates varies. See “Item 5. Operating and Financial Review and Prospects—A. Operating Results—Interest Rates.” We maintain a substantial amount of non-interest-bearing peso-denominated demand deposits. Because such deposits are not sensitive to inflation, any decline in the rate of inflation would adversely affect our net interest margin on assets funded with such deposits, and any increase in the rate of inflation would increase the net interest margin on such assets. The ratio of the average of such demand deposits and average shareholder’s equity to average interest-earning assets was 31.3%, 30.7%, and 29.0% for the years ended December 31, 2025, 2024 and 2023, respectively.
Interest Rates
Interest rates earned and paid on our assets and liabilities reflect, to a certain degree, inflation, expectations regarding inflation, changes in the short-term interest rates set by the Central Bank and movements in the long-term real rates. The Central Bank manages short-term interest rates based on its objectives of balancing low inflation and economic growth. Because our liabilities are generally re-priced sooner than our assets, changes in the rate of inflation or short-term rates in the economy are reflected in the rates of interest paid by us on our liabilities before such changes are reflected in the rates of interest earned by us on our assets. Our Financial Management Division usually seeks to maintain liabilities with an average duration that is shorter than that of our assets, including through the use of derivatives, in order to hedge against sudden or rapid falls in the inflation rate, which in general triggers a reduction in short-term rates. Therefore, when short-term interest rates fall, our net interest margin is positively impacted, but when short-term rates increase, our interest margin is negatively affected. An increase in long-term rates has a positive effect on our net interest margin, because our interest-earning assets generally have longer terms than our interest-bearing liabilities. A flattening of the yield curve (i.e. long-term rates falling quicker than short-term rates) negatively affects our margins by lowering loan yields at a greater pace than deposits costs. In addition, because our peso-denominated liabilities have relatively short re-pricing periods, they are generally more responsive to changes in inflation or short-term rates than our UF-denominated liabilities. As a result, during periods when expected inflation exceeds the previous period’s inflation, customers often switch funds from UF-denominated deposits to peso-denominated deposits, which generally bear higher interest rates, thereby adversely affecting our net interest margin.
Foreign Exchange Fluctuations
The Chilean government’s economic policies and any future changes in the value of the Chilean peso against the U.S. dollar could adversely affect our financial condition and results of operations. The Chilean peso has been subject to significant devaluation in the past and may be subject to significant fluctuations in the future. The exchange rate appreciated 9.4% in 2025, depreciated 13.7% in 2024 and depreciated 2.9% in 2023. A significant portion of our assets and liabilities are denominated in foreign currencies, principally the U.S. dollar, and we historically have maintained and may continue to maintain material gaps between the balances of such assets and liabilities. Our current strategy is not to maintain a significant difference between the balances of our assets and liabilities in foreign currencies. In either case, any differences are usually hedged using forwards and cross-currency swaps. Including derivatives, the Bank seeks to run minimal foreign currency risk in its non-trading balance sheet. Because such assets and liabilities, as well as interest earned or paid on such assets and liabilities, and gains and losses realized upon the sale of such assets, are translated to Chilean pesos in preparing our financial statements, our reported income is affected by changes in the value of the Chilean peso
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relative to foreign currencies (principally the U.S. dollar). The translation gain or loss over assets and liabilities (excluding derivatives held for trading) and derivatives accounted under hedge accounting standards are included as foreign exchange transactions in the income statement. The translation and mark-to-market of foreign currency derivatives held for trading is recognized as a gain or loss in the net results from mark-to-market and trading. The Bank also uses a sensitivity analysis with both internal limits and regulatory limits to seek to manage the potential loss in net interest income resulting from fluctuations of interest rates on U.S. dollar denominated assets and liabilities and a VaR model to limit foreign currency trading risk.
See “Item 11. Quantitative and Qualitative Disclosures About Market Risk—E. Market Risks—Foreign exchange fluctuations” for more detail on the Bank’s exposure to foreign currency.
Consolidated Ratios
We use certain consolidated ratios to measure profitability and efficiency when planning, monitoring and evaluating our performance. The following tables set forth our consolidated ratios for each of the periods indicated.
2025 2024
CONSOLIDATED RATIOS
(IFRS)
Profitability and performance:
Net interest margin(1) 3.8 % 3.4 %
Return on average total assets(2) 1.5 % 1.2 %
Return on average equity(3) 18.3 % 17.0 %
Return on average adjusted equity(4) 20.8 % 19.5 %
Capital:
Average shareholders’ equity as a percentage of average total assets(5) 8.2 % 7.3 %
Total liabilities as a multiple of equity(6) 10.9 11.8
Credit Quality:
Non-performing loans as a percentage of total loans(7) 3.3 % 3.2 %
Allowance for loan losses as percentage of total loans(8) 3.0 % 2.9 %
Operating Ratios:
Operating expenses /operating revenue(9) 36.4 % 39.2 %
Operating expenses /average total assets 1.5 % 1.5 %
OTHER DATA
CPI Inflation Rate 3.4 % 4.5 %
Revaluation (devaluation) rate (Ch$/U.S.$) at year end(10) 9.4 % (13.7 %)
Number of employees at period end 8,526 8,757
Number of branches and offices at period end 229 236
(1)Net interest income divided by average interest earning assets (as presented in “Item 5. Operating and Financial Review and Prospects—C. Selected Statistical Information”).
(2)Net income for the year divided by average total assets (as presented in “Item 5. Operating and Financial Review and Prospects—C. Selected Statistical Information”).
(3)Net income for the year attributable to shareholders divided by average equity (as presented in “Item 5. Operating and Financial Review and Prospects—C. Selected Statistical Information”).
(4)Net income for the year attributable to shareholders divided by average adjusted equity. Average adjusted equity is the average equity (as presented in “Item 5. Operating and Financial Review and Prospects—C. Selected Statistical Information”) adjusted to exclude the average balance of the additional tier 1 perpetual bond.
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(5)Total average shareholders’ equity (as presented in “Item 5. Operating and Financial Review and Prospects—C. Selected Statistical Information”) divided by average total assets (as presented in “Item 5. Operating and Financial Review and Prospects—C. Selected Statistical Information”).
(6)Liabilities divided by equity including non-controlling interest.
(7)Non-performing loans include the aggregate unpaid principal and accrued but unpaid interest on all loans with at least one installment over 90 days past-due. Total loans in 2025 and 2024 correspond to loans at amortized cost.
(8)Allowance for loan losses as of December 31, 2025 and 2024 corresponds to allowances for loans at amortized cost according to IFRS 9.
(9)The efficiency ratio is equal to operating expenses over operating income. Operating expenses includes personnel salaries and expenses, administrative expenses, depreciation and amortization, impairment and other operating expenses. Operating income includes net interest income, net fee and commission income, net income from financial operations (net trading income), foreign exchange gain, net and other operating income.
(10)Based on the interbank market rate published by Reuters at 1:30 pm on the last business day of the period.
Segmentation Criteria
The accounting policies used to determine the Bank’s income and expenses by reporting segment are the same as those described in the summary of accounting policies in “Note 1—Summary of Significant Accounting Policies” of the Bank’s Consolidated Financial Statements and are customized to meet the needs of the Bank’s management. The Bank earns most of its income in the form of interest income, fee and commission income and income from financial operations.
To evaluate a segment’s financial performance and make decisions regarding the resources to be assigned to segments, the Chief Operating Decision Maker (CODM) bases his or her assessment on the segment’s interest income, fee and commission income, and expenses. The Bank’s reporting segments have three Chief Operating Decision Makers: (i) the Director of Retail banking, (ii) the Director of the Middle-market segment and (iii) the Director of Corporate Investment Banking, each of which report to our Chief Executive Officer. All reporting segment information is presented following this structure.
Under IFRS 8, the Bank has aggregated operating segments with similar economic characteristics according to the aggregation criteria specified in the standard. A reporting segment consists of clients that are offered differentiated but, considering how their performance is measured, homogenous services based on IFRS 8 aggregation criteria. The clients included in each business segment are constantly revised and reclassified if a client no longer meets the criteria for the segment they are in and transferred to a different CODM. Therefore, variations of loan volumes and profit and loss items reflect business trends as well as client migration effects. Overall, this aggregation has no significant impact on the understanding of the nature and effects of the Bank’s business activities and the economic environment.
The Bank’s reportable segments are (i) Retail banking, (ii) Middle-market, (iii) Corporate Investment Banking and (iv) Corporate Activities (“Other”). See “Note 3—Reporting Segments” of our Audited Consolidated Financial Statements for more information.
Results of Operations for the Years Ended December 31, 2025 and 2024
In this section, we discuss the results of our operations for the year ended December 31, 2025 compared to the year ended December 31, 2024. For a discussion of the results of our operations for the year ended December 31, 2024 compared to the year ended December 31, 2023, please refer to “Item 5. – A. Operating Results – Results of Operations for the Year Ended December 31, 2024 Compared to the Year Ended December 31, 2023” in our Annual Report on Form 20-F for the year ended December 31, 2024.
The following discussion is based on and should be read together with the Audited Consolidated Financial Statements. The Audited Consolidated Financial Statements have been prepared in accordance with IFRS as issued by the IASB. The following table sets forth the principal components of our net income for the years ended December 31, 2025 and 2024.
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Consolidated Income Statement Data IFRS
2025 2025 2024 % Change 2025/2024
(U.S.$ thousands)(1) (Ch$ million)
Interest income and inflation 4,214,113 3,795,609 4,094,817 (7.3 %)
Interest expense and inflation (2,008,378) (1,808,926) (2,308,031) (21.6 %)
Net interest income 2,205,734 1,986,683 1,786,786 11.2 %
Fees and commission income 1,155,385 1,040,644 960,168 8.4 %
Fees and commission expense (493,858) (444,813) (413,102) 7.7 %
Total net fees and commission income 661,527 595,831 547,066 8.9 %
Net income/(expense) from financial assets and liabilities for trading (48,358) (43,556) 85,013 (151.2 %)
Net income from derecognizing financial assets and liabilities at amortized cost and financial assets at fair value through other comprehensive income 3,262 2,938 (37,068) (107.9 %)
Net income from exchange, adjustment and hedge accounting of foreign exchange 329,081 296,400 202,574 46.3 %
Net income from financial operations 283,985 255,782 250,519 2.1 %
Income from investments in associates and other companies 10,313 9,289 10,436 (11.0) %
Net income from non-current assets and groups available for sale not admissible as discontinued operations 8,042 7,243 4,049 78.9 %
Other operating income 7,790 7,016 8,048 (12.8) %
Total operating income 3,177,391 2,861,844 2,606,904 9.8 %
Personnel salaries and expenses (458,429) (412,902) (398,819) 3.5 %
Administrative expenses (430,342) (387,605) (366,431) 5.8 %
Depreciation and amortization (150,062) (135,159) (141,435) (4.4 %)
Impairment of property, plant and equipment (4,160) (3,747) (1,295) 189.3 %
Other operating expenses (112,917) (101,703) (114,739) (11.4) %
Total operating expenses (1,155,909) (1,041,116) (1,022,719) 1.8 %
Net operating income before credit losses 2,021,481 1,820,728 1,584,185 14.9 %
Provisions for loan losses for interbank loans and account receivable from customers (833,291) (750,537) (660,814) 13.6 %
Provisions for loan losses for contingent loans and others (14,951) (13,466) 2,902 (564.0 %)
Recovery of loans previously charged-off 213,880 192,640 153,944 25.1 %
Provision for loan losses for other financial assets at amortized cost and financial assets at fair value through OCI (4,387) (3,950) (622) 535.0 %
Provision for loan losses (638,747) (575,313) (504,590) 14.0 %
Net operating income before income tax 1,382,734 1,245,415 1,079,595 15.4 %
Income tax expense (230,226) (207,362) (219,745) (5.6 %)
Result of discontinued operations — — — — %
Net income for the year 1,152,509 1,038,053 859,850 20.7 %
Net income for the year attributable to:
Shareholders of the Bank 1,134,297 1,021,650 852,964 19.8 %
Non-controlling interests 18,212 16,403 6,886 138.2 %
(1)Amounts stated in U.S. dollars at and for the year ended December 31, 2025 have been translated from Chilean pesos at the exchange rate of Ch$900.69= U.S.$1.00 as of December 31, 2025.
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Results of Operations for the Years Ended December 31, 2025 and 2024
Net income for the year attributable to shareholders of the Bank increased 19.8% in 2025 compared to 2024 and totaled Ch$1,021,650 million. Our return on annualized average equity (adjusted to exclude the AT1 perpetual bond) was 20.8% in 2025 compared to 19.5% in 2024.
Our net interest income increased 11.2% in 2025 compared to 2024. Net interest income from our reporting segments totaled Ch$2,248,468 million in 2025 and increased 3.8% compared to 2024. This rise was mainly due to a higher-yield asset mix and lower funding costs that benefited from the lower interest rate environment in Chile in 2025. Our interest-bearing liabilities have a shorter maturity than our interest-earning assets and, therefore, incorporate rate cuts more quickly. The increase in net interest income was also due to a decrease in the loss in “other” net interest income, which totaled a loss of Ch$261,785 million in 2025 compared to a loss of Ch$379,913 million in 2024. Overall, our net interest margin increased from 3.36% in 2024 to 3.79% in 2025.
Net fees and commission income increased 8.9% to Ch$595,831 million in 2025 compared to the same period in 2024. Fee growth in 2025 was driven by client growth and cross-selling indicators driven by greater availability and usage of our digital platforms. This resulted in a 12.8% increase in fees from debit and credit cards, a 38.8% increase in fees generated by our acquiring subsidiary Getnet, a 21.7% rise in commission income from brokerage of mutual funds, a 10.5% increase in account management fees, among other items.
Total net income from financial operations reached Ch$255,782 million and increased 2.1% in 2025 compared to 2024. Income from client treasury services totaled Ch$249,648 million, a decrease of 8.7% compared to 2024. In 2025, demand for interest rate and foreign exchange treasury products on behalf of corporate clients declined as volatility decreased in the year in both the interest rate and foreign exchange markets. The results from non-client treasury income totaled Ch$6,134 million in 2025 compared to a loss of Ch$22,845 million in 2024. Non-client treasury results include the income from sale of loans, including charged-off loans, CVA adjustments and most importantly, the treasury results from our Financial Management Division. In 2025, long-term interest rates fell producing higher realized gains from the sale of fixed income instruments and better results from the repurchase of bonds issued by the Bank.
Operating expenses in the year ended December 31, 2025 increased 1.8% compared to the corresponding period in 2024. The efficiency ratio was 36.4% in 2025 and 39.2% in 2024. Personnel salaries and expenses in the year ended December 31, 2025 increased 3.5% compared to the corresponding period in 2024, mainly due to the increase in inflation, as most of the wages paid by the bank pursuant to collective bargaining agreements are indexed to the Chilean CPI, as well as higher variable pay, which was, partially offset by the decrease in headcount. Administrative expenses increased 5.8% in the year ended December 31, 2025 compared to the corresponding period in 2024 primarily due to investments in core systems, cloud computing and technology-related initiatives supporting the modernization of our commercial platforms. Depreciation and amortization expense decreased 4.4% in 2025 compared to 2024, mainly due to lower depreciation of right of use assets and intangible assets, in line with the reduction of the number of branches. Other operating expenses fell 11.4% in 2025 compared to 2024. This decline mainly corresponds to a lower restructuring charges which decreased from Ch$43,156 million in 2024 to Ch$34,164 million in 2025.
Operating income increased 9.8% in 2025 compared to an increase of only 1.8% in operating expenses, which drove the 14.9% increase in net operating income before credit losses.
For the year ended December 31, 2025, provisions for loan losses totaled Ch$638,747 million and increased 14.0% compared to 2024. This increase was mainly due to a Ch$76,823 million increase in the provision expense for mortgage and consumer loans and a Ch$20,495 million increase in loan loss provisions in the Middle Market segment. This was mainly due to the sluggish growth of the economy and persistently high unemployment rates that led to higher loan losses and write-offs. This was partially offset by the 25.1% rise in recovery of loans previously written-off.
Total income tax expense by the Bank in 2025 was Ch$207,362 million and decreased 5.6% compared to 2024. The decrease in income tax expenses in 2025 compared to 2024 mainly reflects the lower growth of the CPI in 2025 compared to 2024 due to the fact that our capital in our Chilean tax books is recast each year based on the variation in the CPI, which causes a tax loss, as well as timing differences between accounting and tax treatment of certain bonds. See “Note 13—Current and Deferred Taxes” of the Audited Consolidated Financial Statements for more detail on income tax expense.
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Therefore while, the statutory corporate tax rate in Chile in 2024 and 2025 was 27%, the Bank recognized an effective tax rate of 16.7% in 2025 compared to 20.4% in 2024.
Net Interest Income
Year ended December 31, % Change
2025 2024 2025/2024
(in millions of Ch$, except percentages)
Retail banking 1,642,104 1,559,556 5.3 %
Wealth Management & Insurance 59,789 57,773 3.5 %
Middle-market 334,660 314,230 6.5 %
Corporate Investment banking 211,915 235,140 (9.9 %)
Total reporting segments 2,248,468 2,166,699 3.8 %
Other(1) (261,785) (379,913) 31.1 %
Net interest income 1,986,683 1,786,786 11.2 %
Average interest-earning assets 52,430,092 53,180,232 (1.4 %)
Average non-interest-bearing demand deposits 10,837,345 11,317,733 (4.2 %)
Net interest margin(2) 3.79 % 3.36 %
Average shareholders’ equity and average non-interest-bearing demand deposits to total average interest-earning assets 31.32 % 30.74 %
(1)Consists mainly of net interest income from the Financial Management Division, including the result of the Bank’s inflation gap as well as the net impact of derivatives used to hedge our exposure to inflation or shifts on interest rates and the cost of funding our financial assets held for trading. Each segment obtains funding from its clients. Any surplus deposits are transferred to the Financial Management Division, which in turn makes such excess available to other areas that need funding. The Financial Management Division also sells the funds it obtains in the institutional funding market at a transfer price equal to the market price of the funds. This segment also includes intra-segment income and activities not assigned to a given segment or product line.
(2)Net interest margin is net interest income divided by average interest-earning assets.
For the year ended December 31, 2025, our net interest income totaled Ch$1,986,683 million and increased 11.2% compared to 2024. Average interest earning assets decreased 1.4% in the same period. During 2025, the loan portfolio decreased 0.9% due to the decrease in commercial loans in CIB and a fall in residential mortgage loans.
The average nominal interest rate earned on interest earning assets decreased from 7.7% in 2024 to 7.2% in 2025. This was mainly due to: (i) lower yields earned over interest earning assets denominated in UF due to the lower UF inflation rate in 2025 compared to 2024. The average interest rate earned over UF denominated interest earning assets reached 6.6% in 2025 compared to 7.4% in 2024; and (ii) lower yields earned over foreign currency interest earning assets, mainly due to lower rates in U.S. dollar-denominated interest earning assets. This fall in asset yields was partially offset by an increase in the yield earned over interest earning assets denominated in Chilean pesos. The average rate earned over interest earning assets denominated in Chilean pesos increased from 9.2% in 2024 to 9.5% in 2024. Despite a lower rate environment locally, the shift of the loan mix away from lending in CIB to consumer loans drove this rise in Ch$ denominated interest earning assets.
Average nominal interest rate earned on interest earning assets 2025 2024
Ch$ 9.5 % 9.2 %
UF 6.6 % 7.4 %
Foreign currencies 3.7 % 4.7 %
Total 7.2 % 7.7 %
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The fall in short-term interest rates and the lower UF inflation also lowered funding costs in 2025 compared to 2024. The average rate paid on our interest-bearing liabilities decreased from 6.3% in 2024 to 4.9% in 2025. Our interest-bearing liabilities have a shorter maturity than our interest-earning assets and, therefore, incorporate rate cuts more quickly. The most important reduction in funding costs came from the lower rate paid on interest bearing time deposits, the Bank's main source of funding, which fell from 5.0% in 2024 to 4.6% in 2025. The lower UF inflation rate in 2025 compared to 2024 also lowered funding costs of interest bearing liabilities denominated in this currency from 8.3% in 2024 to 5.9% in 2025. The funding mix also improved in 2025 as the ratio of average equity and non-interest bearing demand deposits to total average interest earning assets improved from 30.7% in 2024 to 31.3% in 2025, mainly driven by the rise in the Bank's average equity.
Average nominal interest rate paid on interest bearing liabilities 2025 2024
Ch$ 5.9 % 8.7 %
UF 5.9 % 8.3 %
Foreign currencies 1.7 % 1.7 %
Total 4.9 % 6.3 %
In summary, the improved asset mix and the impact of lower rates on funding costs more than offset the impact of lower inflation and rates on interest earning assets, which drove our net interest margin to increase from 3.36% in 2024 to 3.79% in 2025.
Net interest income from our reporting segments in 2025 totaled Ch$2,248,468 million and increased 3.8% compared to 2024. This rise was mainly due to asset growth in higher yielding loan products and lower funding costs. The quicker repricing of deposits in our business segments more than offset low loan growth and the declining yields earned on loans.
•Net interest income from Retail banking increased 5.3% in 2025 compared to 2024. Total loans in the retail segment decreased 2.2% led by a 0.7% decrease in residential mortgage loans. This was partially offset by a 2.5% increase in consumer loans in the year. This fall in loan volumes was also offset by lower interest paid on time deposits as a result of the lower interest rate environment.
•Net interest income from Wealth Management increased 3.5% in 2025 compared to 2024, mainly driven by the 13.0% growth in loan volumes in this segment and lower funding costs. This was partially offset by the lower yield earned over loans in this segment due to the lower rate environment.
•Net interest income from the Middle-market segment increased 6.5% in 2025 mainly due to lower funding costs driven by a lower interest rate environment and the 2.2% increase in loans in this segment during the year.
•Net interest income from the Corporate Investment Banking segment decreased 9.9% in 2025 compared to 2024 mainly due to the 7.1% reduction of this segment's loan portfolio in the year. In 2025, CIB continued to follow a generate-to-distribute model that implies originating and then selling loans in this segment, while focusing on the higher profitability products and services such as transactional services and treasury products in order to optimize capital usage levels.
•The loss in Other net interest income improved 31.1% in 2025 compared to 2024. Other net interest income consists mainly of net interest income from the Bank’s Asset & Liability Management ("ALM") and is managed by the Banks Financial Management Division. This includes net interest income from the Bank’s debt instruments recorded at fair value through other comprehensive income, deposits in the Central Bank, and the financial cost of supporting our cash position and financial investments held for trading (the interest income from which is recognized as net income from financial operations and not interest income). The result of the Bank’s inflation gap is also included in this line as well as the net impact of derivatives used to hedge our inflation gap or views on interest rates.
The result of corporate activities and ALM shows an improvement compared to the previous year, with the loss decreasing by 31.1% to Ch$261,785 million mainly due to an improvement in the cost of funding managed by this division in line with lower short-term rates, which improved the results from fair value hedges of interest rate risk on liabilities (micro hedges), mainly interest rate swaps. This shortened the duration of our liabilities and resulted in a lower rate paid over Central Bank and other borrowings.
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The following table shows our balances of loans and accounts receivable from customers and interbank loans by segment at the dates indicated.
At December 31, % Change
2025 2024 2025/2024
(in millions of Ch)
Retail banking 31,225,378 31,942,515 (2.2 %)
Wealth Management & Insurance 924,692 818,155 13.0 %
Middle-market 6,178,983 6,044,799 2.2 %
Corporate Investment banking 2,139,201 2,301,491 (7.1 %)
Other(1) 464,626 216,884 114.2 %
Total loans 40,932,880 41,323,844 (0.9) %
(1)Includes interbank loans.
The following table shows interest income of financial assets by valuation as of December 31, 2025 and 2024. The 8.6% decrease is mainly due to the lower variation of the UF and the lower interest rate environment, which had a Ch$352,166 million negative impact on interest earning asset yields.
At December 31, % Change
2025 2024 2025/2024
(in millions of Ch)
Financial assets measured at amortized cost(1) 3,793,625 4,160,400 (8.8 %)
Financial assets measured at FVOCI(2) 155,275 162,086 (4.2 %)
Interest income not including income from hedge accounting 3,948,900 4,322,486 (8.6 %)
(1)Financial assets measured at amortized cost include loans measured at amortized cost as described above and investments under resale agreements. The effective interest method is used in the calculation of the amortized cost of the financial asset and in the allocation and recognition of the interest revenue over the relevant period.
(2)Financial assets measured at fair value through other comprehensive income include the interest income from debt instruments. These mainly consisted of securities and bonds of the Central Bank that contain contractual terms that give rise on specific dates to cash flows that are solely payments of principal and interest (SPPI), and are measured at FVOCI.
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Fee and Commission Income
Net fees and commission income increased 8.9% to Ch$595,831 million in the twelve-month period ended December 31, 2025 compared to the same period in 2024. Fee growth in 2025 continued to be driven by client growth, improved cross-selling indicators, and greater availability and usage of our digital platforms. This was partially offset by lower fees from financial advisory services following a record year in 2024 and lower prepayment fees in line with the lower interest environment that reduced demand for the prepayment of loans.
Year ended December 31, % Change
2025 2024 2025/2024
Total clients(1) 4,608,182 4,311,488 6.9 %
Active clients(2) 2,693,441 2,556,462 5.4 %
Loyal clients(3) 1,378,876 1,305,953 5.6 %
Digital clients(4) 2,291,971 2,238,774 2.4 %
(1)Number of clients registered for at least one product.
(2)Number of clients that have used at least one product at least one time in the past month.
(3)Clients with four or more products plus a minimum profitability level and a minimum usage indicator, all differentiated by segment. SME and Middle-market cross-selling is differentiated by client size using a point system that depends on the number of products, usage of products and income net of risk.
(4)Number of clients that used at least one digital channel with password during the last month.
The following table sets forth certain components of our income from services (net of fees paid to third parties directly connected to providing those services, principally fees relating to credit card processing and ATM network administration) in the years ended December 31, 2025 and 2024.
Year ended December 31, % Change
2025 2024 2025/2024
(in millions of Ch$)
Card services (credit, debit and ATM cards) 146,490 129,836 12.8 %
Getnet (acquirer) 109,102 78,623 38.8 %
Brokerage of mutual funds 92,406 75,932 21.7 %
Management of accounts (checking and debit) 80,774 73,076 10.5 %
Collection and payments 61,556 65,187 (5.6 %)
Insurance brokerage 55,039 60,528 (9.1 %)
Guarantees and Letters of credit 42,340 34,893 21.3 %
Financial advisory 21,068 28,378 (25.8 %)
Office banking 20,606 19,958 3.2 %
Prepayments 15,595 17,108 (8.8 %)
Others (49,145) (36,453) 34.8 %
Total fees and commission income, net 595,831 547,066 8.9 %
Fees from card services increased 12.8% in 2025. This rise was mainly due to greater usage of our cards. According to the latest information published by the CMF, Santander Chile's credit cardholders that actively use their cards increased by 5.0% to 1,405,294 in the twelve month period ended November 2025 compared to a 2.7% for banking industry. In the same period, monetary purchases with Santander Chile's credit cards increased 10.7% and market share in terms of total purchases reached 25.9%.
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Fees from Getnet, the Bank's subsidiary in the acquiring business, increased 38.8% in 2025 compared to 2024. This was driven by strong growth in the number of SME and large retail customers of Getnet and greater usage of cards for payments in Chile. The amount of POS terminals in operation increased 11.9% in 2025 compared to 2024.
Fees from the brokerage of mutual funds increased 21.7% in 2025 compared to 2024 driven by a rise in sales of funds to our clients driven by positive returns in both the equity and fixed income funds.
Fees from management of accounts increased 10.5% in 2025 compared to 2024 driven by continued strong account opening growth as a result of our client friendly digital platforms, such as Más Lucas and Santander Life, and positive evolution of client satisfaction and cross-selling indicators.
Fees from collections and payments decreased 5.6% in 2025 compared to 2024 due to lower collection fees related to credit and insurance.
Insurance brokerage fees decreased 9.1% due to lower commissions generated by insurance policies associated with mortgage loans driven by lower commercial activity in this product, in line with the decrease in volume in mortgage loans.
Fees from guarantees and letters of credit increased 21.3% in 2025 compared to 2024 due to higher commissions from our corporate and middle-market clients, particularly related to Stand-by Letters driven by healthy growth trends in foreign trade and exports in 2025.
Fees from financial advisory decreased 25.8% in 2025 due to a decrease in financial advisory services. The record year in financial advisory services in 2024 was not repeated in 2025, especially in the CIB segment.
Fees from office banking, the Bank's online digital banking platform for companies, increased 3.2% in 2025 compared to 2024, mainly due to more and better functionalities that has driven higher usage of this banking platform by our corporate, middle-market and SME customers.
Fees from the prepayment of loans decreased 8.8% in 2025 compared to 2024. As interest rates rates declined in the year the level of prepayment of loans also decreased.
The 34.8% increase in the loss recorded in other fee income in 2025 compared to 2024 was mainly due higher fees paid for credit insurance.
The following table sets forth, for the periods indicated our fee income broken down by segment for the periods indicated (See “Note 26—Fees and Commission” of our Audited Consolidated Financial Statements for more detail on fees by segment):
Year ended December 31, % Change
2025 2024 2025/2024
(in millions of Ch$)
Retail banking 503,186 454,194 10.8 %
Wealth Management & Insurance 30,019 23,183 29.5 %
Middle-market 52,921 43,954 20.4 %
Corporate Investment banking 47,404 54,901 (13.7 %)
Other (37,699) (29,166) 29.3 %
Total fees and commission income, net 595,831 547,066 8.9 %
Fees from Retail banking increased 10.8% in 2025 compared to 2024 mainly driven by a 10.2% increase in fees from management of accounts, a 9.9% increase in card service income and the 38.8% increase in fees from Getnet, our acquiring business mainly geared toward SME clients. The greater availability and usage of our digital platforms, better cross-selling indicators and positive trends of our Net Promoter Score also drove product usage and fees in this segment.
Fees from Wealth Management increased 29.5% in 2025 compared to 2024 due to the 15.7% increase in card service income and the 182.7% increase in fees from securities intermediation in this segment. These growth rates were mainly due
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to an increase in sales of investment funds and greater brokerage of securities to our clients in this segment, driven by positive returns in both the equity and fixed income markets.
The 20.4% increase in fees from the Middle-market segment in 2025 compared to 2024 was mainly due to a 24.7% increase in fees from guarantees and letters of credit particularly related to Stand-by Letters in line with healthy growth trends in foreign trade and exports in 2025. This was partially offset a 36.5% decrease in financial advisory fees.
Fees from the Corporate Investment Banking segment decreased 13.7% in 2025 compared to 2024, mainly due a 15.9% decrease in financial advisory fees in 2025 compared to 2024.
The loss in Other fees increased 29.3% mainly due to was mainly due higher fees paid for credit insurance.
Net Income from Financial Operations
Net income from financial operations amounted to Ch$255,782 million for the year ended December 31, 2025, an increase of 2.1% compared to the year ended December 31, 2024. These results include the results of our Treasury Division’s trading business and financial transactions with customers, as well as the results of our Financial Management Division. The higher result was mainly due to a Ch$29,180 million increase in the results in our Financial Management Division partially offset by a Ch$23,716 million decrease in the results from our client treasury division.
The following table sets forth information regarding our income (loss) from financial transactions for the years ended December 31, 2025 and 2024.
Year ended December 31, % Change
2025 2024 2025/2024
(in millions of Ch$)
Net income/(expense) from financial assets and liabilities for trading (43,556) 85,013 (151.2 %)
Net income from derecognising financial assets and liabilities at amortised cost and financial assets at fair value through other comprehensive income 2,938 (37,068) (107.9 %)
Net income from exchange, adjustment and hedge accounting of foreign exchange 296,400 202,574 46.3 %
Net income from financial operations 255,782 250,519 2.1 %
The net loss from financial assets and liabilities for trading at fair value through the profit and loss statement totaled Ch$43,556 million in the year ended December 31, 2025 and decreased 151.2% compared to 2024. This decrease was mainly due to a Ch$218,033 million loss from foreign currency forwards classified at fair value through profit and loss partially offset by a rise of Ch$89,464 million from other assets and liabilities classified at fair through profit and loss. The loss from foreign currency forwards classified at fair value through profit and loss was mainly due to the appreciation of the Chilean peso against the U.S. dollar in the last quarter of 2025. This was also partially offset by better results from Net income from exchange, adjustment and hedge accounting of foreign exchange which improved by Ch$117,843 million compared to 2024.
Net income from derecognizing financial assets and liabilities at amortized cost and financial assets at fair value through other comprehensive income totaled a gain of Ch$2,938 million in the year ended December 31, 2025 compared to a loss of Ch$37,068 million in the same period in 2024. The higher result was mainly due to a Ch$29,180 million increase in the results in our Financial Management Division. In 2024 this division derecognized fixed income instruments in its portfolio, which is mainly comprised of Chilean Central Bank bonds. Since long-term rates remain above purchase yields, this derecognition resulted in a loss in this line item in 2024, which was previously recorded as a loss in OCI in equity. Since long-term rates have fallen from previous levels and have moved closer to purchase yields, this derecognition has resulted in a gain in this line item during 2025.
Net income from exchange, adjustment and hedge accounting of foreign exchange totaled Ch$296,400 million in the year ended December 31, 2025, an increase of 46.3% compared to the gain obtained in 2024. This higher result was mainly due to the appreciation of the Chilean peso against the U.S. dollar, especially in the last quarter of 2025. The Chilean peso appreciated 9.4% in 2025 and depreciated 13.7% in 2024 against the U.S. dollar. Internal Bank policy does not allow
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significant foreign currency mismatches and requires that the results registered in Net income from financial operations include not only the market-to-market of our foreign currency spot position, but also the results of the derivatives used to hedge currency risk and currency exchange services. The mark-to-market of our spot position and the derivatives used to hedge foreign currency risk are classified in the line item: Net income from exchange, adjustment and hedge accounting of foreign exchange. For more details regarding our management and exposure to foreign currency risk, see “Item 11. Quantitative and Qualitative Disclosures About Market Risk—E. Market Risks—Market risk management—Market risk – local and foreign financial management.”
In order to more easily compare the results from net income from financial operations, we present the following table that separates the results by lines of business for 2025 and 2024.
Year ended December 31, % Change
2025 2024 2025/2024
(in millions of Ch$)
Client treasury products 189,868 193,469 (1.9 %)
Market-making with clients 59,780 79,895 (25.2 %)
Client treasury services 249,648 273,364 (8.7 %)
Sale of loans and charged-off loans 3,395 1,874 81.2 %
CVA adjustments (648) 1,074 (160.3) %
Financial Management Division and others(1) 3,387 (25,793) 113.1 %
Non-client treasury income (loss) 6,134 (22,845) (126.9 %)
Total financial transactions, net 255,782 250,519 2.1 %
(1)The Financial Management Division manages the structural interest rate risk, the structural position in inflation-indexed assets and liabilities, capital requirements and liquidity levels. The aim of the Financial Management Division is to provide stability and continuity in our net interest income from commercial activities, and to ensure that we comply with internal and regulatory limits regarding liquidity, regulatory capital, reserve requirements and market risk.
Income from client treasury services totaled Ch$249,648 million, a decrease of 8.7% compared to 2024. The results from client treasury products and market-making mainly include the results from the sale of derivatives, foreign exchange and fixed income instruments to our client base. In 2025, demand for these types of products on behalf of corporate clients fell as a result of reduced volatility in local and global markets. The results from client treasury, which includes the results from the sale of foreign exchange and interest rate products to clients, mainly in the Middle Market and CIB segments, decreased Ch$3,601 million in 2025 compared to 2024. The results from our market making area decreased Ch$20,115 million in 2025 compared to 2024. Market making involves providing continuous bid and offer prices in selected financial instruments, such as foreign exchange, fixed income securities, and derivatives to support client transactions and maintain market liquidity. These results may vary year-to-year as some large operations with corporate clients may not be repeated in subsequent years and market condition vary each year.
The results from non-client treasury income totaled a gain of Ch$6,134 million in 2025. These results include the income from sale of loans, including charged-off loans, CVA adjustments and most importantly, the treasury results from our Financial Management Division. The results of the Bank’s Financial Management Division totaled a gain of Ch$3,387 million in 2025 compared to a loss of Ch$25,793 million in 2024. In 2025, long-term interest rates fell producing higher realized gains from the sale of fixed income instruments. In 2024, as long-term interest rates remained high, the Bank carried out various liability management exercises including the unwinding of rate and currency hedges and the repurchase of its bonds. These operations help to sustain margins going forward, but in the short-term produced the aforementioned loss.
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Other Operating Income, Income from investments in associates and other companies and Net income form non-current assets and non-continued operations
Year ended December 31, % Change
2025 2024 2025/2024
(in millions of Ch$)
Income from investments in associates and other companies 9,289 10,436 (11.0 %)
Net income from non-current assets and non-continued operations 7,243 4,049 78.9 %
Other operating income 7,016 8,048 (12.8) %
Total 23,548 22,533 4.5 %
Other Operating Income, Income from investments in associates and other companies and Net income from non-current assets and non-continued operations increased by 4.5% in 2025 compared to 2024. Income from investments in associates and other companies decreased 11.0% in 2025 due to a one-time gain recognized in 2024 of Ch$1,903 million from the sale of a 1.28% stake in Cámara de Compensación de Alto Valor S.A.with no corresponding gain in 2025. Net income from non-current assets and non-continued operations increased 78.9% in 2025 compared to 2024, mainly due to higher results from the sale of fixed assets and assets received in lieu of payment. Other operating income decreased 12.8% in 2025 compared to 2024 mainly due to lower interest gained on pension plans and lower recovery of expenses compared to 2024.
Operating Expenses
The following table sets forth information regarding our operating expenses in the years ended December 31, 2025 and 2024.
Year ended December 31, % Change
2025 2024 2025/2024
(in millions of Ch$)
Personnel salaries and expenses (412,902) (398,819) 3.5 %
Administrative expenses (387,605) (366,431) 5.8 %
Depreciation and amortization (135,159) (141,435) (4.4 %)
Impairment of property, plant and equipment (3,747) (1,295) 189.3 %
Other operating expenses (101,703) (114,739) (11.4 %)
Total operating expenses (1,041,116) (1,022,719) 1.8 %
Efficiency ratio(1) 36.4 % 39.2 %
(1)The efficiency ratio is the ratio of total operating expenses to total operating income. Total operating income consists of net interest income, fee income, net income from financial operations, and other operating income.
Operating expenses in the year ended December 31, 2025 increased 1.8% compared to the corresponding period in 2024 mainly due to an increase in personnel salaries and administrative expenses. The efficiency ratio improved to 36.4% in 2025 compared to 39.2% in 2024.
Personnel salaries and expenses in the year ended December 31, 2025 increased 3.5% compared to the corresponding period in 2024, mainly due to the increase in inflation, as most of the wages paid by the bank pursuant to collective bargaining agreements are indexed to the Chilean CPI, and higher performance bonuses in line with better operating results. This was partially offset by the 2.6% decrease in headcount in 2025 compared to 2024.
Administrative expenses increased 5.8% in the year ended December 31, 2025 compared to the corresponding period in 2024. This rise was mainly due to ongoing investments in IT, the digitalization of our banking services and data processing costs. In early 2025, the Bank transitioned most of its data processing functions to a new cloud-based server as
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part of the Santander Group-wide Gravity project. This resulted in higher expenses related to the changeover and write-downs and impairment recognition related to legacy systems. The growth in the client base and product usage also partially drove the rise in administrative expenses.
This increase was partially offset by reductions in the Bank’s branch network. As of December 31, 2025, the Bank had a total of 229 branches which decreased 3.0% in 2025 compared to 2024. The table below provides a breakdown of the Bank’s branch network during the periods indicated.
Year ended December 31, % Change
2025 2024 2025/2024
(in millions of Ch$)
Traditional branches 126 133 (5.3 %)
WorkCafés 94 89 5.6 %
Select 9 14 (35.7 %)
Total branches 229 236 (3.0 %)
Total ATMs (including depositary ATMs) 2,055 2,059 (0.2 %)
Depreciation and amortization expense decreased 4.4% in 2025 compared to 2024 mainly due to the lower depreciation of right of use assets in line with the reduction in our branch network and lower amortization of intangible assets that mainly include internally generated software used for the development of our digital platforms.
The impairment expense increased 189.3% in 2025 compared to 2024 due to impairment of intangible assets mainly obsolete internally developed software.
Other operating expenses decreased 11.4% in 2025 compared to 2024. This fall mainly corresponds to the 20.8% decrease in restructuring charges incurred in 2025 compared to 2024, which totaled Ch$34,164 million. These restructuring charges are mainly due to the on-going restructuring of our branch network and other digital transformations. This was offset by higher operating risk charge-offs and provisions that totaled Ch$48,808 million in 2025. See “Note 29—Other Operating Income and Expenses” to our Audited Consolidated Financial Statements for more detail on Other operating expenses.
The following table sets forth, for the periods indicated, our personnel salaries, administrative and depreciation and amortization expenses broken down by business segment. These amounts exclude impairment and other operating expenses.
Year ended December 31, % Change
2025 2024 2025/2024
(in millions of Ch$)
Retail banking (744,059) (715,845) 3.9 %
Wealth Management & Insurance (32,037) (33,494) (4.4 %)
Middle-market (45,074) (43,343) 4.0 %
Corporate Investment Banking (103,287) (97,420) 6.0 %
Other (14,956) (17,878) (16.3) %
Total personnel, administrative expenses, depreciation and amortization (1) (939,413) (907,980) 3.5 %
(1)Excludes impairment and other operating expenses.
The 3.5% increase in total costs recognized by our business segments was mainly due to greater business activity, IT investments and higher product usage. In Retail Banking, the increase was mainly due to the rise in the client base and accounts, partially offset by the positive impact on costs of less branches. Costs in the Wealth Management and Insurance segment decreased 4.4% due to efficiency driven by digital platforms. Costs in the Middle-market and CIB segments increased 4.0% and 6.0%, respectively driven by the growth of as transactional services, wages and IT investments.
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Provision for loan losses (P&L)
The following table sets forth certain information relating to the P&L impacts of our provision for expected credit losses for the year ended December 31, 2025.
For the year ended Stage 1 Stage 2 Stage 3
December 31 2025 Corporate Other (2) Corporate Other (2) Corporate Other (2) TOTAL (1)
(in millions of Ch$)
Commercial loans 2,831 8,750 (13,573) 84 (67,015) (193,570) (262,493)
Mortgage loans — (6,316) — (3,546) — (75,487) (85,349)
Consumer loans — (7,463) — (13,620) — (381,612) (402,695)
Contingent loans 1,181 (10,730) (159) (5,223) 2,529 (1,064) (13,466)
Loans and account receivable at FVOCI (154) — 312 — (3,657) — (3,499)
Debt at FVOCI (214) — — — — — (214)
Debt at amortised cost (122) — — — — — (122)
Subtotal 3,522 (15,759) (13,420) (22,305) (68,143) (651,733) (767,838)
Recovery of loans previously charged-off 192,640
TOTAL (575,198)
(1)Includes overlays for an amount of Ch$119,776 million. See Note 37, Risk management to our Audited Consolidated Financial Statements
(2)Includes Mortgages, Consumer and Other Commercial loans.
For the year ended December 31, 2025, the P&L impact of provisions for expected credit loss totaled Ch$575,198 million and increased 14.0% compared to 2024. This increase was mainly due to a rise driven by sluggish economic growth and high unemployment rates. This trend was partially offset by a 25.1% rise in recoveries of loans previously charged-off. The table below breaks down these results by main product item:
Year ended December 31, % Change
2025 2024 2025/2024
(in millions of Ch$)
Commercial loans (262,493) (249,593) 5.2 %
Mortgage loans (85,349) (53,574) 59.3 %
Consumer loans (402,695) (357,647) 12.6 %
Contingent loans (13,466) 2,902 564.0 %
Loans and account receivable at FVOCI (3,499) (1,040) 236.4 %
Debt at FVOCI (214) (188) 13.8 %
Debt at amortised cost (122) 606 120.1 %
Subtotal (767,838) (658,534) 16.6 %
Recovery of loans previously charged-off 192,640 153,944 25.1 %
Total Provision for Loan Losses (575,198) (504,590) 14.0 %
Provisions for expected credit losses of our commercial loans totaled Ch$262,493 million for the year ended December 31, 2025 and increased 5.2% compared to 2024. In commercial loans, the rise in provision for loan losses was mainly due to: (i) the sluggish growth of the economy which negatively affected specific clients in various sectors, mainly in the Middle Market segment and (ii) weakness in the agriculture sector due to negative impacts of destructive floods in
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certain fruit producing regions in 2023 and 2024. This drove an increase in commercial loans transferred from Stage 1 to Stage 2 and from Stage 2 to Stage 3. For the same reasons, there was a 26.4% increase in write-offs of commercial loans that totaled Ch$299,933 million representing 1.7% of total average commercial loans in 2025 compared to 1.4% in 2024.
Provisions for expected credit losses for mortgage loans totaled Ch$85,349 million for the year ended December 31, 2025, and increased 59.3% compared to 2024. Total mortgage loans in 2025 decreased 0.7% in 2025 compared to 2024 as the Bank adopted a more conservative stance in terms of loan growth in this product. Persistent high unemployment levels have led to a rise in mortgage loans classified in Stage 3 by 19.5% in 2025 totaling Ch$1,018,317 million. For the same reasons, the write-off of mortgage loans increased by 41.8% to Ch$62,123 million in 2025 compared to 2024. The ratio of write-offs to average mortgage loans was 0.4% in 2025 compared to 0.3% in 2024.
The provisions for expected credit losses for consumer loans totaled Ch$402,695 million and increased 12.6% in 2025. During 2025, the consumer loan book increased 2.5%, mainly driven by a rise in auto and credit card loans. This, together with persistently high levels of unemployment led to an increase of 10.3% of consumer loans classified in Stage 3. Regardless of other factors, if contractual payments are more than 30 days past due, the credit risk is deemed to have increased significantly since initial recognition and consumer loans are written off after 6 months. In 2025, write-off for this loan book decreased 1.0% and totaled Ch$349,805 million. The ratio of write-offs of consumer loans to average consumer loans reached 6.0% in 2025 compared to 6.4% in 2024.
Provisions for contingent loans totaled Ch$13,466 million for the year ended December 31, 2025 compared to a provision reversal of Ch$2,902 million in 2024. Total contingent loans reached Ch$13,508,433 million in 2025 and increased 0.6% compared to 2024. This rise in contingent loans led to an increase of these loans classified in Stage 1 which resulted in a provision loss of Ch$9,549 million compared to a provision reversal of Ch$2,456 million in 2024. See “Note 24b—Contingent Loans” of the Audited Consolidated Financial Statements for more detail on contingent loans.
Generally, charge-offs should be done when all collection efforts are exhausted. These charge-offs consist of derecognition from the Consolidated Statements of Financial Position of the corresponding loans operations in its entirety, and, therefore, include portions not past-due of a loan in the case of installments loans or leasing operations (no partial charge-offs exists). Subsequent payments obtained from charged-off loans will be recognized in the Consolidated Statement of Income as a recovery of loans previously charged-off.
Any payment agreement of an already charged-off loan will not give rise to income-as long as the operation is still in an impaired status-and the effective payments received are accounted for as a recovery from loans previously charged-off. In general, legal collection proceedings begin with respect to consumer loans once they are past-due for at least 90 days and, with respect to mortgage loans, once they are past-due for at least 120 days. Legal collection proceedings always commence within one year of such loans becoming past-due, unless we determine that the size of the past-due amount does not warrant such proceedings. In addition, the majority of our commercial loans are short-term, with single payments at maturity. Past-due loans are required to be covered by individual loan loss reserves equivalent to 100% of any unsecured portion thereof.
Recoveries on loans previously charged-off increased 25.1% in 2025 compared to 2024 as greater amounts of write-offs led to higher recoveries. There was a 26.4% increase in write-offs of commercial loans in 2025 representing 1.7% of total average commercial loans in 2025 compared to 1.4% in 2024. This increase was mainly due to (i) the sluggish growth of the economy which negatively affected specific clients in various sectors, mainly in the Middle Market segment and (ii) weakness in the agricultural sector due to the negative impacts of destructive floods in certain fruit producing regions in 2023 and 2024. Additionally, persistently high unemployment levels have led to a 41.8% rise in the write-off of mortgage loans in 2025 compared to 2024, representing 0.4% of the average mortgage loans outstanding in 2025 compared to 0.3% in 2024. In response, the Bank strengthened recovery efforts during the year, which included the relocation and restructuring of the collections department to the Risk Division. The following table shows recoveries of loans previously charged-off by type of loan.
Year ended December 31, % Change
2025 2024 2025/2024
(in millions of Ch$)
Recovery of loans previously charged-off
Consumer loans 45,587 35,748 27.5 %
Residential mortgage loans 59,271 45,486 30.3 %
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Commercial loans 87,782 72,710 20.7 %
Total recoveries 192,640 153,944 25.1 %
In some instances, we will sell a portfolio of charged-off loans to a third party. Gain (loss) on these charged-off loans is recognized as net income from financial transactions as disclosed in “Note 27—Net Income (Expense) from Financial Operations” of our Audited Consolidated Financial Statements. The following table sets forth information about our sale of charged-off loans for the years ended December 31, 2025 and 2024.
Year ended December 31, % Change
2025 2024 2025/2024
(in millions of Ch$)
Gains (losses) on sale of loans previously charged off 3,395 1,874 81.2 %
The following table sets forth, for the periods indicated, our net provision expense broken down by business segment:
Year ended December 31, % Change
2025 2024 2025/2024
(in millions of Ch$)
Retail banking (498,572) (446,842) 11.6 %
Wealth Management & Insurance (2,870) (2,430) 18.1 %
Middle-market (74,190) (53,695) 38.2 %
Corporate Investment banking 4,269 (2,995) (242.5 %)
Other (3,950) 1,372 387.9 %
Total provisions, net (575,313) (504,590) 14.0 %
Net provision expense in retail banking increased 11.6% in 2025 compared to 2024. This increase was mainly due to the negative impact of elevated unemployment rates in the economy which has affected the consumer, mortgage and SME loan portfolios.
Net provisions expense from Wealth Management increased 18.1% in 2025 compared to 2024 due to strong business growth in this segment. Loans in this segment grew 13.0% in the year .
Net provision expense from the Middle-market segment increased 38.2% in 2025. This increase was mainly due to: (i) the sluggish growth of the economy which negatively affected specific clients in various sectors and (ii) weakness in the agriculture sector due to negative impacts of destructive floods in certain fruit and wine producing regions in 2023 and 2024.
Net provision expense from CIB totaled a reversal of Ch$4,269 million driven by the 7.1% decrease in this segment's loan book.
As of December 31, 2025, the Bank maintains post-model adjustments (overlays) totaling Ch$119,776 million to cover certain defaulted loans from mortgage and other commercial portfolios. We believe that our loan loss allowances are currently adequate for all known and expected credit losses.
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Income tax
Year ended December 31, % Change
2025 2024 2025/2024
(in millions of Ch$)
Net operating income before income tax 1,245,415 1,079,595 15.4 %
Income tax expense (207,362) (219,745) (5.6 %)
Effective tax rate(1) 16.7 % 20.4 %
(1)The effective tax rate is the income tax expense divided by net operating income before income tax.
Total income tax expense by the Bank in 2025 was Ch$207,362 million, a decrease of 5.6% compared to 2024. The decrease in income tax expenses in 2025 compared to 2024 mainly reflects the lower CPI in 2025 compared to 2024, due to the fact that our capital in our Chilean tax books is recast each year based on the variation in the CPI, which causes a tax loss, as well as timing differences between accounting and tax treatment of certain bonds. See “Note 13—Current and Deferred Taxes” of the Audited Consolidated Financial Statements for more detail on income tax expense.
Therefore while, the statutory corporate tax rate in Chile in 2024 and 2025 was 27%, the Bank recognized an effective tax rate of 16.7% in 2025 compared to 20.4% in 2024.
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B.Liquidity and Capital Resources
Sources of Liquidity
The following table sets forth Santander-Chile’s contractual obligations and commercial commitments by time remaining to maturity. As of the date of the filing of this Annual Report, the Bank does not have significant purchase obligations. As of December 31, 2025, the scheduled maturities of our contractual obligations and of other commercial commitments, including accrued interest, were as follows:
Demand Up to 1 month Between 1 and 3 months Between 3 and 12 months Subtotal up to 1 year Between 1 and 3 years Between 3 and 5 years More than 5 years Subtotal after 1 year Total
(in millions of Ch$)
As of December 31 2025
Obligations under repurchase agreements — 2,180,874 574,369 — 2,755,243 — — — — 2,755,243
Checking accounts, time deposits and other time liabilities(1) 15,143,806 7,731,868 3,692,751 4,601,006 31,169,431 435,105 322 32,731 468,158 31,637,589
Financial derivatives contracts — 789,194 1,274,609 2,113,806 4,177,609 2,414,508 1,745,432 3,162,475 7,322,415 11,500,024
Interbank borrowings 28,266 289,677 275,757 1,949,788 2,543,488 659,092 223,890 7,767 890,749 3,434,237
Issued debt instruments — 45,980 676,736 1,642,349 2,365,065 1,995,136 1,205,230 2,133,669 5,334,035 7,699,100
Lease liabilities — — — 6,629 6,629 14,751 11,276 7,993 34,020 40,649
Other financial liabilities(2) — 224,321 — — 224,321 — — — — 224,321
Subtotal 15,172,072 11,261,914 6,494,222 10,313,578 43,241,786 5,518,592 3,186,150 5,344,635 14,049,377 57,291,163
Contractual interest payments(3) — 2,180,874 574,369 — 2,755,243 — — — — 2,755,243
Total 15,172,072 13,442,788 7,068,591 10,313,578 45,997,029 5,518,592 3,186,150 5,344,635 14,049,377 60,046,406
(1)Includes demand deposits and other demand liabilities, cash items in process of being cleared and time deposits and other time liabilities.
(2)Mainly includes amounts owed to credit card processors and to the Chilean Production Development Corporation (Corporación de Fomento de la Producción de Chile), the state development agency.
(3)The table above includes future cash interest payments. For variable rate obligations, we assume the same rate as the last rate known. Various of the payment obligations in the table above are variable debt instruments, since they are denominated in UF, for which we have estimated a long-term inflation rate equal to 3%, which is at the center of the Central Bank’s long-term inflation target. No exclusions requiring further explanation have been made in this table.
The Bank has checking accounts, time deposits and other time liabilities maturing within one year amounting to Ch$31,169,431 million as of December 31, 2025. Santander-Chile’s liquidity depends upon its (i) capital, (ii) reserves, and (iii) financial investments, including cash and investments in government securities. To cover any liquidity shortfalls and to augment its liquidity position, Santander-Chile has established lines of credit with foreign and domestic banks and also has access to Central Bank borrowings. The Bank has a liquidity portfolio of Ch$8,136,013 million as of December 31, 2025, including cash and liquid assets defined by the Bank’s Asset and Liability Committee (ALCO) in line with BIS III guidelines.
For further discussion of the maturities of our liquid assets, see “Analysis of Investments”. Our general policy is to maintain adequate liquidity to ensure our ability to honor withdrawals of deposits, make repayments of other liabilities at maturity, extend loans and meet our own working capital needs. Our minimum amount of liquidity is determined by the statutory reserve requirements of the Central Bank.
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Most instruments maturing after one year are financial derivative contracts and issued debt instruments. Our current funding strategy is to continue to utilize all sources of funding in accordance with their costs, their availability and our general asset and liability management strategy. Special emphasis is placed on retail deposits, lengthening the maturities of funding with institutional clients, and diversifying our bondholder and deposit base. Overall, the management of our liquidity and funding has led to an LCR ratio of 187.7% and a NSFR of 115.1% as of December 31, 2025. Furthermore, the Bank also has regulatory capital of Ch$7,047,321 million, representing 16.9% of our risk-weighted assets as of December 31, 2025.
Lease liabilities
Certain bank premises and equipment are leased and the scheduled maturities of obligations for lease agreements as of December 31, 2025 were as follows:
As of December 31 2025
(in millions of Ch$)
Due within 1 year 6,629
Due after 1 year but within 2 years 8,004
Due after 2 years but within 3 years 6,747
Due after 3 years but within 4 years 6,082
Due after 4 years but within 5 years 5,194
Due after 5 years 7,993
Total 40,649
Other Commercial Commitments
As of December 31, 2025, the scheduled maturities of other commercial commitments, including accrued interest, were as follows:
Up to 1 month Between 1 and 3 months Between 3 and 12 months Between 1 and 3 years Between 3 and 5 years More than 5 years Total
Other Commercial Commitments (in millions of Ch$)
Guarantees 180,829 232,050 874,566 530,122 53,397 838 1,871,802
Confirmed foreign letters of credit 79,588 101,207 62,112 6,233 - - 249,140
Pledges and other commercial commitments 36,280 65,812 397,018 56,494 592 - 556,196
Total other commercial commitments 296,697 399,069 1,333,696 592,849 53,989 838 2,677,138
Other equity instruments
On October 2021, the Bank issued a perpetual bond for U.S.$700 million at an annual rate of 4.63% with no fixed maturity and that is not redeemable before five years from the date of issuance. The trigger (going concern) was set at 5.125% and the bond considers an expiration absorption mechanism. The amount outstanding in Ch$ million at year-end was as follows:
As of December 31, 2025
Current Non-current Total
Ch$ million
Other equity instruments issued other than capital (Perpetual bond) — 629,468 629,468
Total — 629,468 629,468
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Financial Investments
On initial recognition, financial assets and financial liabilities are measured at the transaction price, i.e. the fair value of the consideration given or received (IFRS 13). In the case of financial instruments not at fair value through profit or loss, transaction costs are directly attributable to the acquisition or issue of the financial asset or financial liability. After initial recognition, an entity shall measure a financial liability at amortized cost and an entity shall measure a financial asset at:
(a)Amortized Cost
Financial assets that are held in a business model to collect the contractual cash flows and contain contractual terms that give rise on specific dates to cash flows that are SPPI, are measured at amortized cost.
The effective interest method is used in the calculation of the amortized cost of a financial asset or a financial liability and in the allocation and recognition of the interest revenue or interest expense in profit or loss over the relevant period. The effective interest rate (“EIR”) is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial asset or financial liability to the gross carrying amount of a financial asset or to the amortized cost of a financial liability.
Debt financial instruments at amortized cost
These instruments include high rated Chilean Central Bank bonds and treasury notes issued locally and abroad.
As of December 31, 2025
2025 2024 2023
(in millions of Ch$)
Chilean Central Bank and Government securities 5,098,597 4,852,552 8,178,624
Other Chilean Securities — — —
Foreign securities 427,790 324,527 —
Investment in mutual funds — — —
Total (gross carrying amount) 5,526,387 5,177,079 8,178,624
(b)Fair Value through Other Comprehensive Income (FVOCI)
Financial assets that are debt instruments held in a business model that is achieved by both collecting contractual cash flow and selling, and that contain contractual terms that give rise on specific dates to cash flows that are SPPI, are measured at FVOCI. They are subsequently remeasured at fair value and changes therein (except for those relating to impairment, interest income and foreign currency exchange gains and losses) are recognized in other comprehensive income, until the assets are sold. Upon disposal, the cumulative gain and losses in OCI are recognized in the income statement.
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Debt financial instruments at fair value through other comprehensive income (FVOCI) – under IFRS 9
As of December 31, 2025, 2024 and 2023, the debt instruments at fair value through other comprehensive income (FVOCI) in accordance with IFRS 9 are as follows:
As of December 31 2025
2025 2024 2023
(in millions of Ch$)
Chilean Central Bank and government securities
Chilean Central Bank financial instruments — 199,903 2,286,541
Chilean Treasury bonds and notes 2,825,238 1,273,701 737,705
Other Chilean government financial instruments — — 454
Subtotal 2,825,238 1,473,604 3,024,700
of which sold under repurchase agreement 1,789,703 397,334 207,280
Other Chilean debt financial securities
Chilean Bank debt financial instruments 3,484 5,006 6,656
Other Chilean financial instruments — — —
Subtotal 3,484 5,006 6,656
of which sold under repurchase agreement — — 91
Foreign financial securities
Foreign Central Banks debt financial instruments 769,644 1,001,105 1,238,866
Other foreign financial instruments — 207,770 265,803
Subtotal 769,644 1,208,875 1,504,669
of which sold under repurchase agreement — — 127,752
Total 3,598,366 2,687,485 4,536,025
(c)Fair Value through Profit or Loss (FVTPL)
Financial assets that do not contain contractual terms that give rise on specified dates to cash flows that are SPPI, or if the financial assets, or if the financial asset is not held in a business model that is either (i) a business model to collect the contractual cash flows or (ii) a business model that is achieved by both collecting contractual cash flows and selling.
Financial assets held for trading are recognized at fair value through profit or loss, likewise derivatives contracts for trading purposes.
Financial Instruments Held For Trading
As of December 31 2025
2025 2024 2023
(in millions of Ch$)
Central Bank and Government Securities 714,628 324,982 98,308
Other Chilean Securities — 4,345 —
Foreign financial debt securities — — —
Investments in mutual funds — — —
Total 714,628 329,327 98,308
In 2025, the Bank increased its investment in Chilean Central Bank and government securities in view of the rates offered in relation to their expected risk.
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(d)Equity Instruments
For certain equity instruments, the Bank may make an irrevocable election to present subsequent changes in the fair value of the instrument in other comprehensive income, except for dividend income which is recognized in profit or loss. Gains or losses on derecognition of these equity instruments are not transferred to profit or loss.
Analysis of investments
The following table sets forth an analysis of our investments as of December 31, 2025 by remaining maturity and the weighted average nominal rates of such investments.
Financial Instruments Held For Trading
Within one year Weighted average Nominal Rate After one year but within five years Weighted average Nominal Rate After five years but within ten years Weighted average Nominal Rate After ten years Weighted average Nominal Rate Total Weighted average Nominal Rate
(in millions of Ch$, except rates)
As of December 31 2025 Financial Assets Held for Trading at fair value Central Bank and Government Securities
Chilean Central Bank financial instruments — — — — — — — — — —
Chilean Treasury bonds and notes — — — — — — 714,628 4.5 714,628 4.5
Other Chilean government financial instruments — — — — — — — — — —
Subtotal — — — — — — 714,628 — 714,628 —
Other Chilean debt financial securities — — — — — — — — — —
Chilean Bank debt financial instruments — — — — — — — — — —
Chilean bonds and commercial papers — — — — — — — — — —
Other Chilean financial instruments — — — — — — — — — —
Subtotal — — — — — — — — — —
Foreign financial debt securities — — — — — — — — — —
Foreign Central Banks debt financial instruments — — — — — — — — — —
Other foreign financial instruments — — — — — — — — — —
Subtotal — — — — — — — — — —
Investments in mutual funds — — — — — — — — — —
Funds managed by related entities — — — — — — — — — —
Subtotal — — — — — — — — — —
Total — — — — — — 714,628 — 714,628 —
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Debt financial instruments at amortized cost and Debt financial instruments at FVOCI
Within one year Weighted average Nominal Rate After one year but within five years Weighted average Nominal Rate After five years but within ten years Weighted average Nominal Rate After ten years Weighted average Nominal Rate Total Weighted average Nominal Rate
(in millions of Ch$, except rates)
As of December 31 2025 Debt instruments at amortized cost
Chilean Central Bank debt financial instruments — — — — — — — — — —
Chilean Treasury bonds and notes — — — — — — 5,098,597 3.9 5,098,597 3.9
Subtotal — — — — — 5,098,597 — 5,098,597
Foreign debt financial securities — — — — — — — — — —
Other foreign debt financial instruments — — — — — — 427,790 4.9 427,790 4.9
Subtotal — — — — — — 427,790 — 427,790 —
Total — — — — — — 5,526,387 — 5,526,387 —
Debt instruments at FVOCI
Chilean Central Bank financial instruments — — — — — — — — — —
Chilean Treasury bonds and notes — — 10,207 4.73 — — 2,815,031 3.4 2,825,238 3.5
Other Chilean government financial instruments — — — — — — — — — —
Subtotal — — 10,207 — — — 2,815,031 — 2,825,238 —
Other Chilean Securities
Chilean Bank debt financial instruments — — — — — — 3,484 3.7 3,484 3.7
Chilean bonds and commercial papers — — — — — — — — — —
Other Chilean financial instruments — — — — — — — — — —
Subtotal — — — — — — 3,484 — 3,484 —
Other Financial Securities
Foreign Central Banks debt financial instruments — — — — — — — — — —
Foreign government and state debt financial instruments — — — — — — 769,644 3.6 769,644 —
Other foreign debt financial instruments — — — — — — — — — 5.0
Subtotal — — — — — — 769,644 — 769,644 —
Total — — 10,207 — — — 3,588,159 — 3,598,366 —
Working Capital
As a bank, we satisfy our working capital needs through general funding, the majority of which derives from deposits and other borrowings from the public. (See “Item 5. Operating and Financial Review and Prospects—B. Liquidity and Capital Resources—Deposits and Other Borrowings”). In our opinion, our working capital is sufficient for our present needs.
Liquidity Management
Liquidity management seeks to ensure that, even under adverse conditions, we have access to the funds necessary to cover client needs, maturing liabilities and capital requirements. Liquidity risk arises in the general funding for our financing, trading and investment activities. It includes the risk of unexpected increases in the cost of funding the portfolio of assets at appropriate maturities and rates, the risk of being unable to liquidate a position in a timely manner at a reasonable price and the risk that we will be required to repay liabilities earlier than anticipated.
The following table sets forth the balance of our liquidity portfolio managed by our Financial Management Division in the manner in which it is presented to the Asset and Liability Committee (ALCO) and the Board. The ALCO uses as its
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liquidity portfolio those defined by the FMC and the Central Bank, which are in line with those established in BIS III. As of December 31, 2025 and 2024, the breakdown of the Bank’s liquid assets by levels was the following:
December 31, 2025 December 31, 2024
(Ch$ million) (Ch$ million)
Balance as of:
Cash and cash equivalent 1,904,994 2,416,812
Level 1 liquid assets (1) 6,227,856 7,241,318
Level 2 liquid assets (2) 3,163 4,517
Total liquid assets 8,136,013 9,662,647
(1)Includes available balances held in the Central Bank of Chile, financial instruments issued by the Chilean Treasury or Central Bank and other financial instruments issued or guaranteed by states, multilateral development banks or foreign central banks that have a first class rating, in accordance with international rating agencies.
(2)Includes instruments issued by governments, central banks and development banks of foreign countries with a risk rating of A- to AA+ and mortgage bonds issued by Chilean banks that are acceptable at the Central Bank’s repo window.
December 31, 2025 December 31, 2024
(Ch$ million) (Ch$ million)
Average balance as of:
Cash and cash equivalent 1,828,528 1,732,701
Level 1 liquid assets (1) 6,476,798 6,236,963
Level 2 liquid assets (2) 3,660 5,217
Total liquid assets 8,308,986 7,974,881
(1)Includes available balances held in the Central Bank of Chile, financial instruments issued by the Chilean Treasury or Central Bank and other financial instruments issued or guaranteed by states, multilateral development banks or foreign central banks that have a first class rating, in accordance with international rating agencies.
(2)Includes instruments issued by governments, central banks and development banks of foreign countries with a risk rating of A- to AA+ and mortgage bonds issued by Chilean banks that are acceptable at the Central Bank’s repo window.
Our general policy is to maintain liquidity adequate to ensure our ability to honor withdrawals of deposits, make repayments of other liabilities at maturity, extend loans and meet our own working capital needs. Our minimum amount of liquidity is determined by the statutory reserve requirements of the Central Bank. Deposits are subject to a statutory reserve requirement of 9.0% for demand deposits and 3.6% for Chilean peso-, UF- and foreign currency denominated time deposits with a term of less than a year. See “Item 4. Information on the Company—B. Business Overview—Competition—Regulation and Supervision.” The Central Bank has statutory authority to increase these percentages to up to 40.0% for demand deposits and up to 20.0% for time deposits. In addition, a 100% special reserve (reserva técnica) applies to demand deposits, deposits in checking accounts, other demand deposits received or obligations payable on sight and incurred in the ordinary course of business, other than deposits unconditionally payable immediately. This special reserve requirement applies to the amount by which the total of such deposits exceeds 2.5 times the amount of a bank’s regulatory capital. Interbank loans are deemed to have a maturity of more than 30 days, even if payable within the following 10 days. The Central Bank has also set other liquidity limits and ratios that minimize liquidity risk. See “Item 11. Quantitative and Qualitative Disclosures About Market Risk.”
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Cash Flow
The tables below set forth our main sources of cash. The subsidiaries are not an important source of cash flow for us and therefore have no impact on our ability to meet our cash obligations. No legal or economic restrictions exist on the ability of subsidiaries to transfer funds to us in the form of loans or cash dividends as long as these subsidiaries abide by the regulations of the Ley General de Bancos and the Ley de Sociedad Anónimas regarding loans to related parties and minimum dividend payments. See our Consolidated Statements of Cash Flows in our Audited Consolidated Financial Statements for a detailed breakdown of the Bank’s cash flow.
Year ended December 31,
2025 2024 2023
Millions of Ch$
Net cash flow (used in) provided by operating activities 55,407 482,388 1,315,758
Our operating activities provided cash in an amount of Ch$55,407 million in 2025, mainly due to the cash flow provided by profits and the decrease in loans, deposits, and other funding sources, mainly bonds partially offset by the funds used in purchasing financial investments and bond repurchases. Our operating activities provided cash for Ch$482,388 million in 2024, mainly due an increase in profits, deposits, and other funding sources partially offset by the repayment of the Bank’s FCIC obligation with the Central Bank of Chile. Our operating activities provided cash for Ch$1,315,758 million in 2023, mainly derived from an increase in time deposits and obligations with foreign banks, partially offset by cash used in the growth of the loan portfolio.
Year ended December 31,
2025 2024 2023
Millions of Ch$
Net cash (used in) provided by investment activities (104,945) (106,580) (117,850)
In 2025, the Bank’s investment activities consumed cash in an amount of Ch$104,945 million, mainly due to the purchase of property, plant and equipment, which was mainly related to investments in the WorkCafé branch network. Cash was also consumed by investments in intangible assets, related to the Bank’s digital strategy and cloud computing investments. In 2024, the Bank’s investment activities consumed cash in an amount of Ch$106,580 million in 2024 mainly due to the purchase of property, plant and equipment, which was mainly related to investments in the Workcafé branch network. Cash was also consumed by investments in intangible assets, mainly related to the Bank’s digital strategy. due to the purchase of intangible assets, mainly related to the digital strategy. In 2023, the Bank’s investment activities consumed cash in an amount of Ch$117,850 million, mainly due to the purchase of intangible assets, mainly related to the Bank’s digital strategy.
Year ended December 31,
2025 2024 2023
Millions of Ch$
Net cash provided by (used in) financing activities (621,098) (372,847) (515,292)
In 2025, net cash used in financing activities was Ch$621,098 million and was mainly due to the payment of the annual dividend paid to shareholders in April 2025, which was higher than the dividend paid in 2024. In 2024, net cash used in financing activities was Ch$372,847 million due to the annual dividend payment. In 2023, net cash used by financing activities was Ch$515,292 million due to the annual dividend payment.
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Deposits and Other Borrowings
The following table sets forth our average balance of liabilities for the years ended December 31, 2025, 2024, and 2023, in each case together with the related average nominal interest rates paid thereon.
2025 2024 2023
Average Balance % of Total Average Liabilities Average Nominal Rate Average Balance % of Total Average Liabilities Average Nominal Rate Average Balance % of Total Average Liabilities Average Nominal Rate
(in millions of Ch$, except percentages)
Interest-bearing liabilities
Savings accounts 246,969 0.4 % 3.2 % 204,486 0.3 % 4.5 % 190,469 0.3 % 3.6 %
Time deposits 16,819,761 24.7 % 4.6 % 18,333,279 26.6 % 7.4 % 16,392,793 23.6 % 7.4 %
Central Bank borrowings — 0.0 % 0.0 % 2,227,144 3.2 % 5.1 % 5,773,345 8.3 % 12.2 %
Repurchase agreements 2,189,070 3.2 % 4.9 % 567,006 0.8 % 9.1 % 779,214 1.1 % 7.2 %
Mortgage finance bonds 71 0.0 % 5.6 % 455 0.0 % 11.4 % 2,063 0.0 % 9.3 %
Commercial paper 837,704 1.2 % 4.9 % 639,541 0.9 % 6.0 % 613,212 0.9 % 5.8 %
Other interest bearing liabilities 17,155,876 25.2 % 5.1 % 14,707,545 21.3 % 8.0 % 14,920,208 21.5 % 8.7 %
Subtotal interest-bearing liabilities 37,249,451 54.6 % 4.9 % 36,679,456 53.2 % 6.3 % 38,671,304 55.6 % 8.6 %
Non-interest bearing liabilities
Non-interest bearing deposits 10,837,345 15.9 % 11,317,733 16.4 % 11,099,866 16.0 %
Derivatives 11,497,964 16.9 % 11,710,435 17.0 % 10,937,411 15.7 %
Other non-interest bearing liabilities 3,011,037 4.4 % 4,162,306 6.0 % 4,108,850 5.9 %
Equity 5,584,350 8.2 % 5,028,887 7.3 % 4,720,294 6.8 %
Subtotal non-interest bearing liabilities 30,930,696 45.4 % 32,219,361 46.8 % 30,866,421 44.4 %
Total liabilities 68,180,147 100.0 % 68,898,817 100.0 % 69,537,725 100.0 %
Our most important source of funding is our deposits. Average time deposits plus non-interest bearing demand deposits represented 40.6% of our average total liabilities and shareholders’ equity in 2025. As of December 31, 2025, the Bank’s top 20 time deposits represented 20.0% of total time deposits, or 4.8% of total liabilities and equity. Our current funding strategy is to continue to utilize all sources of funding in accordance with their costs, their availability and our general asset and liability management strategy. Special emphasis is being placed on lengthening the maturities of funding with institutional clients, diversifying our bond holder base and broadening our core deposit funding. We believe that broadening our deposit base by increasing the number of account holders has created a more stable funding source. The liquidity coverage ratio (“LCR”), which measures the short-term resistance of Banks’ liquidity risk profile to ensure that organizations have an adequate pool of unencumbered, high-quality liquid assets, which can be readily and immediately converted to cash in private markets, in order to meet short-term liquidity needs. As of December 31, 2025, our LCR was 187.7%. The net stable funding ratio (“NSFR”) which measures a bank’s stable funding sources over required stable needs was 115.1% as of December 31, 2025.
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Composition of Deposits
The following table sets forth the composition of our deposits and similar commitments at December 31, 2025, 2024, 2023, 2022, and 2021.
2025 2024 2023 2022 2021
(in millions of Ch$)
Demand deposits and other demand obligations
Current accounts 11,674,317 11,898,457 11,014,748 11,711,969 14,385,633
Other deposits and demand accounts 966,621 915,917 854,595 1,016,896 1,773,233
Other demand obligations 1,434,652 1,446,235 1,668,483 1,357,361 1,742,072
Subtotals 14,075,590 14,260,609 13,537,826 14,086,226 17,900,938
Time deposits and other time deposits
Time deposits 16,216,079 16,867,607 15,939,325 12,779,206 9,926,507
Time saving accounts 269,821 221,973 189,757 191,257 195,570
Other time deposits 7,883 9,045 8,860 8,327 8,978
Subtotals 16,493,783 17,098,625 16,137,942 12,978,790 10,131,055
Total deposits and other commitments 30,569,373 31,359,234 29,675,768 27,065,016 28,031,993
Maturity of Interest Bearing Deposits
The following table sets forth information regarding the currency and maturity of our interest bearing deposits as of December 31, 2025, expressed in percentages of our total deposits in each currency category. UF-denominated deposits are similar to peso-denominated deposits in all respects, except that the principal is readjusted periodically based on variations in the Chilean consumer price index.
Ch$ UF Foreign Currencies Total
Demand deposits 0.0 % 0.6 % 0.0 % 0.1 %
Savings accounts 0.8 % 22.9 % 0.0 % 1.6 %
Time deposits:
Maturing within 3 months 66.3 % 43.8 % 78.2 % 67.6 %
Maturing after 3 but within 6 months 12.9 % 17.6 % 12.5 % 13.0 %
Maturing after 6 but within 12 months 16.7 % 9.3 % 9.0 % 14.9 %
Maturing after 12 months 3.3 % 5.8 % 0.3 % 2.8 %
Total time deposits 99.2 % 76.5 % 100.0 % 98.3 %
Total deposits 100.0 % 100.0 % 100.0 % 100.0 %
The following table sets forth information regarding the maturity of our outstanding time deposits (excluding savings accounts and other time deposits) as of December 31, 2025.
Ch$ UF Foreign Currencies Total
Time deposits:
Maturing within 3 months 8,270,306 322,846 2,559,840 11,152,992
Maturing after 3 but within 6 months 1,607,868 129,558 407,302 2,144,728
Maturing after 6 but within 12 months 2,090,389 68,217 294,603 2,453,209
Maturing after 12 months 411,999 42,955 10,196 465,150
Total deposits 12,380,562 563,576 3,271,941 16,216,079
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Short-term Borrowings
The following table shows the average balance and the average nominal rate for each short-term borrowing category for the years indicated.
2025 2024 2023
Average Balance Average Nominal Interest Rate Average Balance Average Nominal Interest Rate Average Balance Average Nominal Interest Rate
(in millions of Ch$, except percentages)
Obligations under repurchase agreements 2,189,070 4.9 % 567,006 9.1 % 779,214 7.2 %
Obligations with the Central Bank — 0.0 % 2,227,144 5.1 % 5,773,345 12.2 %
Loans from domestic financial institutions 333,388 2.4 % 1,063,703 0.9 % 55,839 7.0 %
Foreign obligations 3,814,336 6.8 % 3,794,062 8.0 % 3,421,666 6.9 %
Total Short-term borrowings 6,336,794 5.9 % 7,651,915 6.3 % 10,030,064 10.0 %
The following table presents the maximum month-end balances of our principal sources of short-term borrowings during the years indicated.
Maximum 2025 Month-End Balance Maximum 2024 Month-End Balance Maximum 2023 Month-End Balance
(in millions of Ch$)
Obligations under repurchase agreements 3,786,251 1,886,763 1,161,741
Obligations with the Central Bank — 6,147,010 6,048,867
Loans from domestic financial institutions 591,535 819,596 225,604
Foreign obligations 4,152,873 4,355,474 4,271,414
Total short-term borrowings 8,530,659 13,208,843 11,707,626
Total Borrowings
As of December 31, 2025
Long-term Short-term Total
(in millions of Ch$)
Loans from Central Bank — — —
Obligations under repurchase agreements 574,369 2,180,874 2,755,243
Mortgage finance bonds (a) — 55 55
Senior bonds (b) 5,278,740 2,365,010 7,643,750
Mortgage bonds (c) 55,295 — 55,295
Regulatory capital financial instruments (d) 1,746,324 202,169 1,948,493
Borrowings from domestic financial institutions — 30,052 30,052
Foreign borrowings (e) 890,749 2,513,436 3,404,185
Other obligations (f) — 224,321 224,321
Total borrowings 8,545,477 7,515,917 16,061,394
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As of December 31, 2024
Long-term Short-term Total
(in millions of Ch$)
Central Bank credit lines for renegotiations of loans — — —
Obligations under repurchase agreements — 276,588 276,588
Mortgage finance bonds 7 213 220
Senior bonds 5,420,980 2,646,294 8,067,274
Mortgage bonds 65,781 — 65,781
Regulatory capital financial instruments 1,910,697 — 1,910,697
Borrowings from domestic financial institutions 40,000 12,311 52,311
Foreign borrowings 932,481 3,353,155 4,285,636
Other obligations — 200,541 200,541
Total borrowings 8,369,946 6,489,102 14,859,048
As of December 31, 2023
Long-term Short-term Total
(in millions of Ch$)
Central Bank credit lines for renegotiations of loans 5,584,084 — 5,584,084
Obligations under repurchase agreements — 315,355 315,355
Mortgage finance bonds 1,206 2,592 3,798
Senior bonds 6,597,776 482,696 7,080,472
Mortgage bonds 74,515 7,108 81,623
Regulatory capital financial instruments 1,733,870 — 1,733,870
Borrowings from domestic financial institutions — 41,318 41,318
Foreign borrowings — 3,239,363 3,239,363
Other obligations 239 292,756 292,995
Total borrowings 13,991,690 4,381,188 18,372,878
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(a)Mortgage finance bonds
These bonds are used to finance mortgage loans. Their principal amounts are amortized on a quarterly basis. Loans are indexed to UF and pay a yearly interest rate.
As of December 31, 2025
(in millions of Ch$)
Due within 1 year 55
Due after 1 year but within 2 years —
Due after 2 years but within 3 years —
Due after 3 years but within 4 years —
Due after 4 years but within 5 years —
Due after 5 years —
Total mortgage finance bonds 55
(b)Senior bonds
The following table sets forth, at the dates indicated, our issued senior bonds. The bonds are denominated principally in UFs, Ch$, CHF or U.S. dollars, and are principally used to fund assets with similar durations.
As of December 31,
2025 2024 2023
(in millions of Ch$)
Santander bonds in UF 3,822,554 3,830,030 3,632,979
Santander bonds in USD 1,410,129 1,971,887 2,424,045
Santander bonds in CHF 917,621 866,942 637,203
Santander bonds in Ch$ 1,066,919 827,738 619,386
Santander bonds in AUD 91,224 93,244 116,515
Current bonds in JPY 177,332 296,831 323,922
Santander bonds in EUR 157,971 180,602 171,335
Total senior bonds 7,643,750 8,067,274 7,925,385
The maturities of these bonds are as follows:
As of December 31, 2025
(in millions of Ch$)
Due within 1 year 2,365,011
Due after 1 year but within 2 years 1,215,822
Due after 2 year but within 3 years 750,329
Due after 3 year but within 4 years 642,855
Due after 4 year but within 5 years 562,375
Due after 5 years 2,107,358
Total bonds 7,643,750
In 2025, the Bank issued bonds for UF 17,540,000, CLP 328,550,000,000, CHF 140,000,000, JPY 14,000 and USD 20, detailed as follows:
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Series Currency Amount Term (years) Issuance rate (%) Issuance date Placement date Maturity date
BSTD180624 UF 1,300,000 P1Y11M 2.00% 1/10/25 1/13/25 12/1/26
BSTD180624 UF 1,700,000 P1Y10M 2.00% 2/3/25 2/4/25 12/1/26
BSTD230822 UF 100,000 P6Y 3.00% 2/4/25 2/5/25 2/1/31
BSTD230822 UF 200,000 P6Y 3.00% 2/5/25 2/6/25 2/1/31
BSTD120923 UF 800,000 P8Y7M 3.00% 2/6/25 2/7/25 9/1/33
BSTD151023 UF 1,385,000 P2Y7M 2.00% 2/17/25 2/18/25 10/1/27
BSTDA61022 UF 600,000 P12Y6M 3.00% 3/28/25 3/31/25 10/1/37
BSTD120923 UF 300,000 P8Y5M 3.00% 3/28/25 3/31/25 9/1/33
BSTD120923 UF 500,000 P8Y5M 3.00% 4/1/25 4/2/25 9/1/33
BSTD120923 UF 100,000 P8Y5M 3.00% 4/2/25 4/3/25 9/1/33
BSTD120923 UF 500,000 P8Y5M 3.00% 4/8/25 4/10/25 9/1/33
BSTD230822 UF 620,000 P5Y10M 3.00% 4/9/25 4/10/25 2/1/31
BSTD120923 UF 20,000 P8Y5M 3.00% 4/9/25 4/10/25 9/1/33
BSTD211024 UF 350,000 P2Y 2.00% 4/9/25 4/10/25 4/1/27
BSTD211024 UF 200,000 P2Y 2.00% 4/10/25 4/11/25 4/1/27
BSTD120923 UF 780,000 P8Y5M 3.00% 4/15/25 4/16/25 9/1/33
BSTD230822 UF 180,000 P5Y10M 3.00% 4/15/25 4/16/25 2/1/31
BSTDA61022 UF 1,365,000 P12Y6M 3.00% 4/16/25 4/17/25 10/1/37
BSTDA61022 UF 350,000 P12Y5M 3.00% 4/23/25 4/24/25 10/1/37
BSTD211024 UF 148,000 P1Y15M 2.00% 4/24/25 4/25/25 4/1/27
BSTD211024 UF 2,000 P1Y10M 2.00% 4/24/25 4/25/25 4/1/27
BSTDA61022 UF 100,000 P12Y5M 3.00% 5/6/25 5/7/25 10/1/37
BSTD211024 UF 200,000 P1Y11M 2.00% 5/12/25 5/13/25 4/1/27
BSTD230822 UF 510,000 P5Y6M 2.65% 8/7/25 8/8/25 2/1/31
BSTD211024 UF 1,200,000 P1Y7M 2.30% 8/20/25 8/21/25 4/1/27
6XBSTD230822 UF 100,000 P5Y4M 2.65% 10/1/25 10/2/25 2/1/31
7XBSTD230822 UF 150,000 P5Y4M 2.65% 10/1/25 10/3/25 2/1/31
8XBSTD230822 UF 300,000 P5Y4M 2.65% 10/1/25 10/2/25 2/1/31
9XBSTD230822 UF 150,000 P5Y4M 2.65% 10/7/25 10/8/25 2/1/31
10BSTD230822 UF 400,000 P5Y4M 2.65% 10/8/25 10/9/25 2/1/31
11BSTD230822 UF 100,000 P5Y4M 2.65% 10/8/25 10/10/25 2/1/31
12BSTD230822 UF 200,000 P5Y4M 2.65% 10/10/25 10/13/25 2/1/31
6XBSTD210622 UF 530,000 P4Y1M 2.75% 10/20/25 10/21/25 12/1/29
13BSTD230822 UF 400,000 P5Y4M 2.65% 10/21/25 10/22/25 2/1/31
0XBSTDBA0225 UF 400,000 P6Y10M 3.00% 10/23/25 10/24/25 8/1/32
14BSTD230822 UF 300,000 P5Y4M 2.65% 10/27/25 10/28/25 2/1/31
1XBSTD220425 UF 800,000 P14Y5M 3.00% 10/28/25 10/30/25 4/1/40
2XBSTD220425 UF 200,000 P14Y5M 3.00% 10/28/25 10/30/25 4/1/40
Total UF 17,540,000
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BSTD110723 CLP 50,000,000,000 P2Y2M 6.00% 5/2/25 5/3/25 7/1/27
BSTDA91122 CLP 30,300,000,000 P5Y6M 6.00% 5/14/25 5/15/25 11/1/30
BSTD170624 CLP 3,000,000,000 P3Y 6.00% 5/16/25 5/17/25 6/1/28
BSTDA21222 CLP 77,750,000,000 P4Y 6.00% 5/16/25 5/17/25 6/1/29
BSTD170624 CLP 10,000,000,000 P3Y 6.00% 5/20/25 5/22/25 6/1/28
BSTD170624 CLP 5,000,000,000 P3Y 6.00% 5/22/25 5/23/25 6/1/28
BSTDA40922 CLP 90,000,000,000 P7Y10M 6.00% 5/22/25 5/23/25 3/1/33
BSTD170624 CLP 20,000,000,000 P3Y 6.00% 6/11/25 6/13/25 6/1/28
1XBSTDBI0525 CLP 40,000,000,000 P2Y6M 6.00% 11/12/25 11/13/25 5/1/28
2XBSTDBI0525 CLP 2,500,000,000 P2Y5M 6.00% 11/20/25 11/21/25 5/1/28
Total CLP 328,550,000,000
Bond CHF BNP & ZKB CHF 140,000,000 P5Y3M 1.19% 5/12/25 5/30/25 8/29/30
Total CHF 140,000,000
Bond JPY Santander SA JPY 4,000,000,000,000,000 P20Y 2.80% 4/24/25 4/29/25 4/28/45
Bond JPY Daiwa ESG JPY 10,000,000,000,000,000 P3Y 1.50% 7/2/25 7/10/25 7/10/28
Total JPY 14,000,000,000,000,000
Bond USD SOFR Daiwa USD 10,000,000 P5Y 5.05% 6/6/25 6/13/25 6/13/30
XS3257573298 USD 10,000,000 P5Y 6.00% 12/17/25 12/29/25 12/29/30
Total USD 20,000,000
In 2024, the Bank issued the following bonds:
Series Currency Amount Term (years) Issuance rate (% annual) Issuance date Placement date Maturity date
AA13 UF 1,795,000 7.5 years 3.40% 09-01-2023 01-03-2024 09-01-2029
AA14 UF 4,567,000 9 years 3.30% 12-01-2023 02-07-2024 12-01-2028
W3 UF 3,160,000 6 years 1.60% 12-01-2018 01-04-2024 06-01-2026
AA15 UF 1,615,000 9 years 3.20% 10-01-2023 05-09-2024 11-01-2030
AA16 UF 3,000,000 6 years 3.20% 04-01-2024 07-05-2024 10-01-2026
T21 UF 2,165,000 9 years 2.75% 06-01-2022 07-08-2024 12-01-2029
T19 UF 5,000,000 6 years 2.65% 08-01-2022 10-17-2024 08-01-2033
Total UF 21,302,000
AA7 CLP 7,350,000,000 5.5 years 6.80% 02-24-2023 01-04-2024 08-01-2026
AA10 CLP 25,000,000,000 5.5 years 7.10% 03-01-2023 03-25-2024 03-01-2026
AA8 CLP 67,500,000,000 3.5 years 6.70% 03-01-2023 01-05-2024 09-01-2027
AA2 CLP 4,000,000,000 6 years 6.20% 12-01-2022 01-11-2024 06-01-2029
AA9 CLP 41,700,000,000 8 years 6.30% 11-01-2022 01-05-2024 11-01-2030
Total CLP 145,550,000,000
CHF bond CHF 225,000,000 1 year 1.60% 01-11-2024 01-25-2024 01-25-2027
Total CHF 225,000,000
Mortgage bonds
These bonds are used to finance mortgage loans with certain characteristics such as loan-to-value ratios below 80.0% and a debt servicing ratio of the client lower than 20.0%. All outstanding mortgage bonds are UF denominated. The maturities of our mortgage bonds are as follows:
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As of December 31,
2025 2024
(in millions of Ch$)
Due within 1 year — —
Due after 1 year but within 2 years — —
Due after 2 year but within 3 years 28,984 —
Due after 3 year but within 4 years — 36,950
Due after 4 year but within 5 years — —
Due after 5 years 26,311 28,831
Total mortgage bonds 55,295 65,781
During 2025 and 2024, the Bank did not place any mortgage bonds.
(c)Regulatory capital financial instruments
The following table sets forth, at the dates indicated, the balances of our regulatory capital financial instruments, which are entirely comprised of subordinated bonds. The following table sets forth, at the dates indicated, our issued subordinated bonds. The bonds are denominated principally in UFs or U.S. dollars, and are principally used to fund the Bank’s mortgage portfolio and are considered to be a part of our regulatory capital.
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As of December 31,
2025 2024 2023
(in millions of Ch$)
Subordinated bonds linked to the U.S.$ 181,378 199,701 175,234
Subordinated bonds linked to the UF 1,767,115 1,710,996 1,638,705
Total subordinated bonds 1,948,493 1,910,697 1,813,939
The maturities of these bonds, which are considered long-term, are as follows.
As of December 31, 2025
(in millions of Ch$)
Due within 1 year 202,169
Due after 1 year but within 2 years —
Due after 2 years but within 3 years 124,099
Due after 3 years but within 4 years —
Due after 4 years but within 5 years 181,378
Due after 5 years 1,440,847
Total subordinated bonds 1,948,493
During 2025 and 2024, the Bank did not issue subordinated bonds.
(d)Foreign borrowings
These are short-term and long-term borrowings from foreign banks mainly used to fund our foreign trade business. The maturities of these borrowings are as follows.
As of December 31, 2025
(in millions of Ch$)
Due within 1 year 2,513,436
Due within 1 and 2 year 369,126
Due within 2 and 3 year 289,966
Due within 3 and 4 year —
Due after 4 to 5 years 223,890
Due after 5 years 7,767
Total loans from foreign financial institutions 3,404,185
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(e)Other obligations
Other obligations are summarized as follows:
As of December 31, 2025
Ch$ million
Long term obligations:
Due after 1 years but within 2 years —
Due after 2 years but within 3 years —
Due after 3 years but within 4 years —
Due after 4 years but within 5 years —
Due after 5 years —
Long-term financial obligations subtotals —
Short term obligations:
Amounts due to credit card operators 192,107
Acceptance of letters of credit 30,628
Other long-term financial obligations, short-term portion 1,586
Short-term financial obligations subtotals 224,321
Other financial obligations totals 224,321
Other Off-Balance Sheet Arrangements and Commitments
In the normal course of our business, we are party to transactions with off-balance sheet risk. These transactions expose us to credit risk in addition to amounts recognized in the consolidated financial statements. The most important off-balance sheet item is contingent loans. Contingent loans consist of guarantees granted by us in Ch$, UF and foreign currencies (principally U.S.$), unused letters of credit and commitments to extend credit such as overdraft protection and credit card lines of credit. Such commitments are agreements to lend to a customer at a future date, subject to the customer compliance with the contractual terms. Since a substantial portion of these commitments is expected to expire without being drawn upon, the total amount of commitments does not necessarily represent our actual future cash requirements. We use the same credit policies in making commitments to extend credit as we do for granting loans, therefore, in the opinion of our management, our outstanding commitments represent normal credit risk.
The following table presents the Bank’s outstanding contingent loans as of December 31, 2025, 2024 and 2023:
As of December 31,
2025 2024 2023
(in millions of Ch$)
Personal guarantees 556,196 365,932 494,104
Letter of credits of merchandise traffic operations 249,140 308,407 262,496
Transactions related to contingent events 1,871,802 2,208,507 1,641,510
Unrestricted prompt cancel credit lines 10,584,496 10,352,459 9,490,141
Other credit commitments 246,799 195,207 314,318
Total 13,508,433 13,430,512 12,202,569
Asset and Liability Management
Please refer to “Item 11. Quantitative and Qualitative Disclosures about Market Risk” for information regarding our policies with respect to asset and liability management.
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Capital Expenditures
The following table reflects capital expenditures in each of the three years ended December 31, 2025, 2024 and 2023:
As of December 31,
2025 2024 2023
(in millions of Ch$)
Land and Buildings 29,820 26,515 31,574
Machinery, Systems and Equipment 42,722 29,404 25,697
Furniture, Vehicles, Other(1) 18,706 15,749 28,875
Software development 52,868 44,559 45,067
Total 144,116 116,227 131,213
(1)Includes assets ceded under operating leases.
During 2025, the Bank focused its investments in the ongoing investments in IT and the digitalization of our banking services and expanding the WorkCafé network. In early 2025, the Bank transitioned most of its data processing functions to a new cloud-based server as part of the Group-wide Gravity project.
C.Selected Statistical Information
The following information is included for analytical purposes and should be read in conjunction with our Audited Consolidated Financial Statements, as well as the discussion in this “Item 5. Operating and Financial Review and Prospects.” The UF is linked to, and is adjusted daily to reflect changes in, the previous month’s Chilean consumer price index. See “Item 5. Operating and Financial Review and Prospects—A. Operating Results—Impact of Inflation.”
Average Balances, Income Earned from Interest-Earning Assets and Interest Paid on Interest-Bearing Liabilities
The average balances for interest-earning assets and interest-bearing liabilities, including interest and readjustments received and paid, have been calculated on the basis of daily balances for us on an unconsolidated basis. Such average balances are presented in Chilean pesos, UFs and in foreign currencies (principally U.S. dollars). Figures from our subsidiaries have been calculated on the basis of monthly balances. The average balances of our subsidiaries, except Sociedad Operadora de Tarjetas de Pago Santander Getnet Chile S.A., have not been categorized by currency. As such it is not possible to calculate average balances by currency for such subsidiaries on the basis of daily, weekly or monthly balances.
The nominal interest rate has been calculated by dividing the amount of interest and principal changes in the UF index (gain or loss) during the period by the related average balance, both amounts expressed in constant Chilean pesos.
The Bank has also distributed the financial cost or gain of hedges to the corresponding item being hedged to more clearly reflect the impact of these hedging strategies on yields earned or paid over assets and liabilities. For this reason, total interest earned over interest earning assets and interest paid over interest bearing liabilities can be different form the amounts recorded in the income statement, but the net interest income is equivalent to the amount recorded in the income statement. Foreign exchange gains or losses on foreign currency-denominated assets and liabilities are not included in interest income or expense. When a financial asset becomes credit-impaired and is, therefore, regarded as “Stage 3”, the Bank suspends the interest income recognition in the income statement. Similarly, trading and mark-to-market gains or losses on investments are not included in interest income or expense. Interest is not recognized on non-performing loans. Non-performing loans that are past-due for 90 days or less have been included in each of the various categories of loans, and therefore affect the various averages. Non-performing loans consist of loans as to which either principal or interest is past-due (i.e., non-accrual loans) and restructured loans earning no interest.
Included in interbank deposits are checking accounts maintained in the Central Bank and foreign banks. Such assets have a distorting effect on the average interest rate earned on total interest-earning assets because currently balances maintained in Chilean peso amounts do not earn interest, and the only balances held in a foreign currency that earn interest are those maintained in U.S. dollars, but those only earn interest on the amounts that are legally required to be held for liquidity purposes. Additionally, this account includes interest earned by overnight investments. Consequently, the average interest earned on such assets is comparatively low. We maintain these deposits in these accounts to comply with statutory
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requirements and to facilitate international business, rather than to earn income. See Note 1—Summary of Significant Accounting Policies—(k) Recognizing Income and Expenses to our Audited Consolidated Financial Statements.
The following tables show, by currency of denomination, average balances and, where applicable, interest amounts and real rates for our assets and liabilities for the years ended December 31, 2025, 2024 and 2023.
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As of December 31,
2025 2024 2023
Average Balance Interest Earned Average Nominal Rate Average Balance Interest Earned Average Nominal Rate Average Balance Interest Earned Average Nominal Rate
Assets
Interest earning assets
Deposits in Central Bank
Ch$ 438,299 42,759 9.8 % 1,798,219 103,775 5.8 % 1,151,196 11,367 1.0 %
UF — — — % — — — % — — — %
Foreign currency 209,895 2,633 1.3 % — — — % — — — %
Total 648,194 45,392 7.0 % 1,798,219 103,775 5.8 % 1,151,196 11,367 1.0 %
Financial investments (1)
Ch$ 5,107,625 115,755 2.3 % 4,632,133 79,396 1.7 % 6,870,255 312,529 4.5 %
UF 2,535,450 107,951 4.3 % 2,050,990 40,394 2.0 % 1,948,039 15,401 0.8 %
Foreign currency 1,054,423 48,967 4.6 % 1,775,767 6,683 0.4 % 2,032,147 23,155 1.1 %
Total 8,697,498 272,673 3.1 % 8,458,890 126,473 1.5 % 10,850,441 351,085 3.2 %
Commercial Loans
Ch$ 7,408,955 802,995 10.8 % 7,217,886 790,642 11.0 % 7,514,142 990,169 13.2 %
UF 6,241,929 441,683 7.1 % 6,425,726 535,782 8.3 % 6,404,622 630,575 9.8 %
Foreign currency 3,816,340 144,608 3.8 % 3,801,056 257,793 6.8 % 3,605,705 221,816 6.2 %
Total 17,467,224 1,389,286 8.0 % 17,444,668 1,584,217 9.1 % 17,524,469 1,842,560 10.5 %
Consumer loans
Ch$ 5,773,162 832,561 14.4 % 5,452,160 836,949 15.4 % 5,141,105 786,598 15.3 %
UF 2,670 301 11.3 % 6,457 404 6.3 % 10,513 507 4.8 %
Foreign currency 75,331 1 — % 83,610 5 — % 72,816 5 — %
Total 5,851,163 832,863 14.2 % 5,542,227 837,358 15.1 % 5,224,434 787,110 15.1 %
Mortgage loans
Ch$ 19,588 14 0.1 % 11,352 14 0.1 % 7,660 17 0.2 %
UF 17,447,106 1,172,414 6.7 % 17,333,470 1,343,237 7.7 % 16,306,409 1,287,251 7.9 %
Foreign currency — — — % — — — % — — — %
Total 17,466,694 1,172,428 6.7 % 17,344,822 1,343,251 7.7 % 16,314,069 1,287,268 7.9 %
Interbank loans
Ch$ 9,519 480 5.0 % 13,862 909 6.6 % 5,541 579 10.4 %
UF — — — % — — — % — — — %
Foreign currency 21,391 51 0.2 % — — — % — — — %
Total 30,910 531 1.7 % 13,862 909 6.6 % 5,541 579 10.4 %
Investment agreements to resell
Ch$ 81,134 2,977 3.7 % 52,655 — — % 21,952 — — %
UF 61,083 4,295 7.0 % — — — % — 71 — %
Foreign currency 112,664 5,120 4.5 % — — — % — — — %
Total 254,881 12,392 4.9 % 52,655 — — % 21,952 71 — %
Threshold (2)
Ch$ 138,389 9,280 6.7 % 628,904 9,646 1.5 % 984,360 9,564 1.0 %
UF — — — % — — — % 2 — — %
Foreign currency 1,875,139 60,765 3.2 % 1,895,985 89,188 4.7 % 2,515,723 114,388 4.5 %
Total 2,013,528 70,045 3.5 % 2,524,889 98,834 3.9 % 3,500,085 123,952 3.5 %
Total interest earning assets
Ch$ 18,976,671 1,806,821 9.5 % 19,807,171 1,821,331 9.2 % 21,696,211 2,110,823 9.7 %
UF 26,288,238 1,726,644 6.6 % 25,816,643 1,919,817 7.4 % 24,669,585 1,933,805 7.8 %
Foreign currency 7,165,183 262,145 3.7 % 7,556,418 353,669 4.7 % 8,226,391 359,364 4.4 %
Total 52,430,092 3,795,610 7.2 % 53,180,232 4,094,817 7.7 % 54,592,187 4,403,992 8.1 %
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As of December 31,
2025 2024 2023
Average Balance Interest Earned Average Nominal Rate Average Balance Interest Earned Average Nominal Rate Average Balance Interest Earned Average Nominal Rate
Cash
Ch$ 1,651,291 1,212,988 1,147,881
UF — 1,962 1,190
Foreign currency 2,087,520 184,097 149,615
Total 3,738,811 1,399,047 1,298,686
Allowance for loan losses
Ch$ (1,040,362) (1,068,928) (1,285,860)
UF — — —
Foreign currency (194,370) (168,607) (125,624)
Total (1,234,732) (1,237,535) (1,411,484)
Fixed assets
Ch$ 237,911 116,798 109,720
UF — 0 0
Foreign currency — 0 0
Total 237,911 116,798 109,720
Derivatives
Ch$ 11,348,109 12,519,562 11,915,184
UF — 0 0
Foreign currency 9 0 0
Total 11,348,118 12,519,562 11,915,184
Financial Investment (Trading)
Ch$ 319,041 183,671 78,500
UF 88,600 47,861 85,377
Foreign currency 257 411,019 695,497
Total 407,898 642,551 859,374
Other assets
Ch$ 1,073,672 1,132,808 1,433,356
UF 11,713 81,117 78,050
Foreign currency 166,664 1,064,237 662,652
Total 1,252,049 2,278,162 2,174,058
Total non-interest earning assets
Ch$ 13,589,662 14,096,899 13,398,781
UF 100,313 130,940 164,617
Foreign currency 2,060,080 1,490,746 1,382,140
Total 15,750,055 15,718,585 14,945,538
Total assets
Ch$ 32,566,333 1,806,821 33,904,070 1,821,331 36,284,649 1,597,540
UF 26,388,551 1,726,644 25,947,583 1,919,817 23,513,065 2,372,149
Foreign currency 9,225,263 262,145 9,047,164 353,669 9,588,794 137,341
Total 68,180,147 3,795,610 68,898,817 4,094,817 69,386,508 4,107,030
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As of December 31,
2025 2024 2023
Average Balance Interest Earned Average Nominal Rate Average Balance Interest Earned Average Nominal Rate Average Balance Interest Earned Average Nominal Rate
Liabilities And Shareholders’ Equity
Interest bearing liabilities
Savings accounts
Ch$ 76,222 2,292 3.0 % 35,256 999 2.8 % 10,798 281 2.6 %
UF 170,747 5,495 3.2 % 169,230 8,146 4.8 % 179,671 6,562 3.7 %
Foreign currency — — — % — — — % — — — %
Total 246,969 7,787 3.2 % 204,486 9,145 4.5 % 190,469 6,843 3.6 %
Time deposits
Ch$ 16,230,898 739,566 4.6 % 12,400,925 698,611 5.6 % 11,007,900 1,005,077 9.1 %
UF 569,752 28,498 5.0 % 752,746 55,696 7.4 % 1,125,964 95,029 8.4 %
Foreign currency 19,111 865 4.5 % 5,179,608 160,559 3.1 % 4,258,929 110,776 2.6 %
Total 16,819,761 768,929 4.6 % 18,333,279 914,866 5.0 % 16,392,793 1,210,882 7.4 %
Central bank borrowings
Ch$ — — — % 2,227,144 113,806 5.1 % 5,773,345 703,113 12.2 %
UF — — — % — — — % — — — %
Foreign currency — — — % — — — % — — — %
Total — — — % 2,227,144 113,806 5.1 % 5,773,345 703,113 12.2 %
Repurchase Agreements
Ch$ 1,666,977 74,197 4.5 % 525,525 49,471 9.4 % 397,017 35,597 9.0 %
UF 38,492 200 0.5 % — — — % — — — %
Foreign currency 483,601 33,079 6.8 % 41,481 2,280 5.5 % 382,197 20,184 5.3 %
Total 2,189,070 107,476 4.9 % 567,006 51,751 9.1 % 779,214 55,781 7.2 %
Mortgage finance bonds
Ch$ — — — % — — — % — — — %
UF 71 4 5.6 % 455 52 11.4 % 2,063 192 9.3 %
Foreign currency — — — % — — — % — — — %
Total 71 4 5.6 % 455 52 11.4 % 2,063 192 9.3 %
Commercial paper
Ch$ — — — % — — — % — — — %
UF — — — % — — — % — — — %
Foreign currency 837,704 41,429 4.9 % 639,541 38,471 6.0 % 613,212 35,772 5.8 %
Total 837,704 41,429 4.9 % 639,541 38,471 6.0 % 613,212 35,772 5.8 %
Other interest bearing liabilities
Ch$ 3,235,403 436,285 13.5 % 2,913,211 711,266 24.4 % 3,859,742 819,756 21.2 %
UF 5,996,119 368,349 6.1 % 5,413,433 459,098 8.5 % 5,184,297 463,172 8.9 %
Foreign currency 7,924,354 78,667 1.0 % 6,380,901 9,576 0.2 % 5,876,169 15,432 0.3 %
Total 17,155,876 883,301 5.1 % 14,707,545 1,179,940 8.0 % 14,920,208 1,298,360 8.7 %
Total interest bearing liabilities
Ch$ 21,209,500 1,252,340 5.9 % 18,102,061 1,574,153 8.7 % 21,048,802 2,563,824 12.2 %
UF 6,775,181 402,546 5.9 % 6,335,864 522,992 8.3 % 6,491,995 564,955 8.7 %
Foreign currency 9,264,770 154,040 1.7 % 12,241,531 210,886 1.7 % 11,130,507 182,164 1.6 %
Total 37,249,451 1,808,926 4.9 % 36,679,456 2,308,031 6.3 % 38,671,304 3,310,943 8.6 %
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As of December 31,
2025 2024 2023
Average Balance Interest Earned Average Nominal Rate Average Balance Interest Earned Average Nominal Rate Average Balance Interest Earned Average Nominal Rate
Non-interest bearing liabilities
Non-interest bearing demand deposits
Ch$ 9,094,698 10,998,237 10,754,656
UF — 94,183 89,127
Foreign currency 1,742,647 225,313 256,083
Total 10,837,345 11,317,733 11,099,866
Derivatives
Ch$ 11,497,940 11,710,435 10,937,254
UF — — —
Foreign currency 24 — 157
Total 11,497,964 11,710,435 10,937,411
Other non-interest bearing liabilities
Ch$ 1,985,243 1,844,366 1,768,888
UF 36,824 104,979 445,842
Foreign currency 988,970 2,212,961 1,894,120
Total 3,011,037 4,162,306 4,108,850
Shareholders’ equity
Ch$ 4,912,332 5,028,887 4,720,294
UF — — —
Foreign currency 672,018 — —
Total 5,584,350 5,028,887 4,720,294
Total non-interest bearing liabilities and shareholders’ equity
Ch$ 27,490,213 29,581,925 28,181,092
UF 36,824 199,162 534,969
Foreign currency 3,403,659 2,438,274 2,150,360
Total 30,930,696 32,219,361 30,866,421
Total Liabilities and Shareholders’ Equity
Ch$ 48,699,713 1,252,340 47,683,986 1,574,153 49,229,894 2,563,824
UF 6,812,005 402,546 6,535,026 522,992 7,026,964 564,955
Foreign currency 12,668,429 154,040 14,679,805 210,886 13,280,867 182,164
Total 68,180,147 1,808,926 68,898,817 2,308,031 69,537,725 3,310,943
(1)This line item includes debt instruments at fair value through other comprehensive income according to IFRS 9.
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Changes in Net Interest Revenue and Interest Expense: Volume and Rate Analysis
The following table allocates, by currency of denomination, changes in our net interest revenue and interest expense between changes in the average volume of interest-earning assets and interest-bearing liabilities and changes in their respective nominal interest rates for 2025 compared to 2024 and 2024 compared to 2023. Volume and rate variances have been calculated based on movements in average balances over the period and changes in nominal interest rates on average interest-earning assets and average interest-bearing liabilities.
Increase (Decrease) from 2024 to 2025 Due to Changes in Increase (Decrease) from 2023 to 2024 Due to Changes in
Volume Rate Net Change from 2024 to 2025 Volume Rate Net Change from 2023 to 2024
ASSETS
Interest earning assets
Deposits in Central Bank
Ch$ 5,193 (66,209) (61,016) (25,110) 117,518 92,408
UF — — — — — —
Foreign currency — 2,633 2,633 — — —
Subtotal 5,193 (63,576) (58,383) (25,110) 117,518 92,408
Financial investments
Ch$ (56,447) 92,806 36,359 (21,167) (211,966) (233,133)
UF (28,434) 95,991 67,557 (3,702) 28,695 24,993
Foreign currency 188,306 (146,022) 42,284 (474) (15,998) (16,472)
Subtotal 103,425 42,775 146,200 (25,343) (199,269) (224,612)
Commercial loans
Ch$ (3,062) 6,039 2,977 (28,120) (171,407) (199,527)
UF — 4,295 4,295 1,188 (95,981) (94,793)
Foreign currency — 5,120 5,120 10,596 25,381 35,977
Subtotal (3,062) 15,454 12,392 (16,336) (242,007) (258,343)
Consumer loans
Ch$ (90) (339) (429) 46,571 3,780 50,351
UF — — — 61 (164) (103)
Foreign currency — 51 51 — — —
Subtotal (90) (288) (378) 46,632 3,616 50,248
Mortgage loans
Ch$ (53,606) 65,959 12,353 (3) — (3)
UF (5,539) (88,560) (94,099) 156,468 (100,482) 55,986
Foreign currency 2,289 (115,474) (113,185) — — —
Subtotal (56,856) (138,075) (194,931) 156,465 (100,482) 55,983
Interbank loans
Ch$ 4,804 (9,192) (4,388) (9,366) 9,696 330
UF 21 (124) (103) — — —
Foreign currency (4) — (4) — — —
Subtotal 4,821 (9,316) (4,495) (9,366) 9,696 330
Investment under agreements to resell
Ch$ — — — — — —
UF 2,301 (173,124) (170,823) — — —
Foreign currency — — — — — —
Subtotal 2,301 (173,124) (170,823) — — —
Threshold
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Ch$ (266) (100) (366) 61 21 82
UF — — — — — —
Foreign currency (2,507) (25,916) (28,423) (29,171) 3,971 (25,200)
Subtotal (2,773) (26,016) (28,789) (29,110) 3,992 (25,118)
Total interest earning assets
Ch$ (103,474) 88,964 (14,510) (37,134) (252,358) (289,492)
UF (31,651) (161,522) (193,173) 154,015 (167,932) (13,917)
Foreign currency 188,084 (279,608) (91,524) (19,049) 13,354 (5,695)
Total 52,959 (352,166) (299,207) 97,832 (406,936) (309,104)
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Increase (Decrease) from 2024 to 2025 Due to Changes in Increase (Decrease) from 2023 to 2024 Due to Changes in
Volume Rate Net Change from 2024 to 2025 Volume Rate Net Change from 2023 to 2024
LIABILITIES AND SHAREHOLDERS’ EQUITY
Interest bearing liabilities
Savings accounts
Ch$ 1,518 (225) 1,293 969 (251) 718
UF (12) (2,639) (2,651) 23 1,561 1,584
Foreign currency — — — — — —
Subtotal 1,506 (2,864) (1,358) 992 1,310 2,302
Time deposits
Ch$ — 40,955 40,955 127,190 (433,656) (306,466)
UF (5,044) (22,154) (27,198) (26,489) (12,844) (39,333)
Foreign currency (159,771) 77 (159,694) 18,106 31,677 49,783
Subtotal (164,815) 18,878 (145,937) 118,807 (414,823) (296,016)
Central Bank borrowings
Ch$ (113,806) — (113,806) (377,741) (211,566) (589,307)
UF — — — — — —
Foreign currency — — — — — —
Subtotal (113,806) — (113,806) (377,741) (211,566) (589,307)
Repurchase agreements
Ch$ (24,538) 49,264 24,726 10,065 3,809 13,874
UF — 200 200 — — —
Foreign currency 27,782 3,017 30,799 (18,015) 111 (17,904)
Subtotal 3,244 52,481 55,725 (7,950) 3,920 (4,030)
Mortgage finance bonds
Ch$ — — — — — —
UF (40) (8) (48) (158) 18 (140)
Foreign currency — — — — — —
Subtotal (40) (8) (48) (158) 18 (140)
Commercial papers
Ch$ — — — — — —
UF — — — — — —
Foreign currency 4,325 (8,833) (4,508) 1,406 1,293 2,699
Subtotal 4,325 (8,833) (4,508) 1,406 1,293 2,699
Other interest bearing liabilities
Ch$ 53,313 (353,153) (299,840) (262,970) 154,480 (108,490)
UF 11,368 (141,321) (129,953) 3,314 (7,388) (4,074)
Foreign currency 45,401 62,818 108,219 (1,952) (3,904) (5,856)
Subtotal 110,082 (431,656) (321,574) (261,608) 143,188 (118,420)
Total interest bearing liabilities
Ch$ (83,513) (263,159) (346,672) (502,488) (487,183) (989,671)
UF 6,272 (165,922) (159,650) (23,311) (18,652) (41,963)
Foreign currency (82,263) 57,079 (25,184) (1,861) 27,884 26,023
Total (159,504) (372,002) (531,506) (527,660) (477,951) (1,005,611)
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Interest-Earning Assets: Net Interest Margin
The following table analyzes, by currency of denomination, the levels of average interest-earning assets and net interest earned by Santander-Chile, and illustrates the comparative net interest margins obtained, for each of the years indicated in the table.
As of December 31,
2025 2024 2023
(in millions of Ch$)
Total average interest-earning assets
Ch$ 18,976,671 19,807,171 21,696,211
UF 26,288,238 25,816,643 24,669,585
Foreign currencies 7,165,183 7,556,418 8,226,391
Total 52,430,092 53,180,232 54,592,187
Net interest earned(1)
Ch$ 554,481 247,178 (453,001)
UF 1,324,098 1,396,825 1,368,850
Foreign currencies 108,105 142,783 177,200
Total 1,986,684 1,786,786 1,093,049
Net interest margin(2)
Ch$ 2.92% 1.25% (2.09%)
UF 5.04% 5.41% 5.55%
Foreign currencies 1.51% 1.89% 2.15%
Total 3.79 % 3.36 % 2.00 %
(1)Net interest earned is defined as interest revenue earned less interest expense incurred.
(2)Net interest margin is defined as net interest earned divided by total average interest-earning assets.
Loan Portfolio
Loan Categories
Our loan categories are as follows:
Interbank loans
Interbank loans are long-term and short-term loans made to other local or international banks, granted in Chilean pesos or foreign currencies, usually at a variable rate linked to Chilean interbank rates, SOFR or other interbank rates.
Commercial loans
Commercial loans are long-term and short-term loans, including checking overdraft lines for companies, granted in Chilean pesos, inflation linked, U.S.$ linked or denominated in U.S.$. The interest on these loans is fixed or variable and is used primarily to finance working capital or investments. General commercial loans also include factoring operations.
Foreign trade loans are fixed rate, short-term loans made in foreign currencies (principally U.S.$) to finance imports and exports.
Checking account debtors are checking overdraft lines granted to companies, in Chilean pesos or U.S.$, generally on a fixed rate nominal basis and linked to a company’s checking account.
Credit card debtors includes credit card balances from businesses subject to nominal fixed rate interest charges.
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Factoring transactions mainly include short-term loans to companies with a fixed monthly nominal rate backed by a company invoice.
Leasing transactions are agreements for the financial leasing of capital equipment and other property.
Student loans mainly include long-term loans made to finance tertiary education mainly in fixed real rates (UF) some of which some are guaranteed by the state. These loans, per Chilean regulations, must be classified as commercial loans since they are guaranteed by the Chilean State under Law 20.027 through CORFO, the government’s development agency.
Other loans and accounts receivable loans include other commercial loans and accounts payable not included in any of the categories above.
Mortgage loans
Loans with mortgage finance bonds are inflation-indexed, fixed or variable rate, long-term loans with monthly payments of principal and interest secured by a real property mortgage that are financed with mortgage finance bonds as defined in Chapter 9-1 of Chilean banking regulations. At the time of approval, these types of mortgage loans cannot be more than 75.0% of the lower of the purchase price or the appraised value of the mortgaged property or such loan will be classified as a commercial loan. Mortgage bonds are our general obligations, and we are liable for all principal and accrued interest on such bonds. In addition, if the issuer of a mortgage finance bond becomes insolvent, the General Banking Law’s liquidation procedures provide that these types of mortgage loans with their corresponding mortgage bonds shall be auctioned as a unit and the acquirer must continue paying the mortgage finance bonds under the same conditions as the original issuer.
Endorsable mortgage mutual loans are inflation-indexed fixed rate or variable rate, long-term loans with monthly payment of principal and interest secured by a real property mortgage that are financed through general funding. These kinds of loans are supported by a contract deed, which can be sold in the market through an endorsement.
Mortgage mutual financed with mortgage bond includes mortgage loans (fixed and variable rate) that are inflation-indexed long-term loans with monthly payments of principal and interest secured by a real property mortgage. These are financed by issuing mortgage bonds as defined in Chapter 9-2 of Chilean banking regulations.
Other mortgage mutual loans mainly include mortgage loans (fixed and variable rate) that are inflation-indexed long-term loans with monthly payments of principal and interest secured by a real property mortgage. These are financed by our general borrowings.
Other loans and accounts receivable loans include other mortgage loans and accounts payable not included in any of the categories above.
Consumer loans
Installment consumer loans are loans to individuals, granted in Chilean pesos, generally on a fixed rate nominal basis, to finance the purchase of consumer goods or to pay for services. This includes auto loans originated through Santander Consumer Chile.
Checking account debtors are checking overdraft lines to individuals, granted in Chilean pesos, generally on a fixed rate nominal basis and linked to an individual’s checking account.
Credit card debtors include credit card balances subject to nominal fixed rate interest charges.
Leasing transactions are agreements for the financial leasing of automobiles and other property to individuals.
Other consumer loans are other loans to individuals that are not classified in any of the other categories shown above.
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Maturity and Interest Rate Sensitivity of Loans
The following table sets forth an analysis by type and time remaining to maturity of our loans at amortized cost as of December 31, 2025.
Due in 1 year or less Due after 1 year through 5 years Due after 5 years through 15 years Due after 15 years Total balance as of December 31, 2025
(in millions of Ch$)
Interbank loans 68,178 — — — 68,178
Commercial loans 6,262,564 4,754,358 1,924,290 349,413 13,290,625
Foreign trade loans 1,737,235 44,657 4,421 — 1,786,313
Checking accounts debtors 107,088 1,120 — — 108,208
Credit card debtors 64,540 89,623 48 — 154,211
Factoring transactions 937,645 — — — 937,645
Leasing transactions 311,458 560,653 103,626 9 975,746
Student loans 5,188 13,463 10,643 476 29,770
Other loans and account receivable 41,283 39,547 390 97 81,317
SUBTOTAL Commercial loans 9,467,001 5,503,421 2,043,418 349,995 17,363,835
Loans with mortgage finance bonds 14 — — — 14
Endorsable mortgage mutual loans 97 149 4 — 250
Mortgage mutual financed with mortgage bonds 7,089 27,006 38,240 4,873 77,208
Other mortgage mutual loans 1,060,875 4,181,763 8,017,299 4,002,582 17,262,519
Other credit and account receivable 4,532 18,058 43,626 37,356 103,572
SUBTOTAL Mortgage loans 1,072,607 4,226,976 8,099,169 4,044,811 17,443,563
Installment consumer loans 1,364,813 2,429,956 61,592 7 3,856,368
Checking accounts debtors 137,325 8 5 — 137,338
Credit card debtors 840,521 1,220,458 712 — 2,061,691
Leasing transactions 859 717 — — 1,576
Other consumer loans 328 2 1 — 331
SUBTOTAL Consumer loans 2,343,846 3,651,141 62,310 7 6,057,304
Total 12,951,632 13,381,538 10,204,897 4,394,813 40,932,880
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The following tables present the total amount of loans that have fixed and variable interest rates as of December 31, 2025 for each category of loans required to be disclosed under IFRS financial statements. See also “Item 5. Operating and Financial Review and Prospects—A. Operating Results—Interest Rates.
As of December 31, 2025
(in millions of Ch$)
Variable Interest Rates Fixed Interest Rates
Interbank — 68,178
Commercial loans 2,824,080 10,466,545
Foreign trade loans 116,354 1,669,959
Checking accounts debtors 95,343 12,865
Credit card debtors — 154,211
Factoring transactions — 937,645
Leasing transactions 15,282 960,465
Student loans — 29,770
Other loans and account receivable 193 81,124
Subtotals 3,051,252 14,312,584
Loans with mortgage finance bonds — 14
Endorsable mortgage mutual loans — 250
Mortgage mutual financed with mortgage bonds — 77,208
Other mortgage mutual loans 4,612,008 12,650,511
Other credit and account receivable 11,321 92,250
Subtotals 4,623,329 12,820,234
Installment consumer loans 5 3,856,363
Checking accounts debtors 128,959 8,380
Credit card debtors — 2,061,691
Leasing transactions — 1,576
Other consumer loans — 331
Subtotals 128,964 5,928,340
Totals loans to clients 7,803,545 33,129,336
Analysis and Classification of Loan Portfolio Based on the Borrower’s Payment Performance
The following table analyzes our non-performing and impaired loans. Non-performing loans include the aggregate principal and accrued but unpaid interest of any loan with one installment that is at least 90 days past-due, and do not accrue interest. Loan information corresponds to loans at amortized cost in accordance with IFRS 9. See “Note 8—Financial Assets at Amortized Cost” of the Audited Consolidated Financial Statements.
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2025 2024
(Ch$ million)
Total loans 40,932,880 41,323,844
Allowance for loan losses 1,222,458 1,192,690
Impaired loans 2,615,378 2,404,820
Impaired loans as a percentage of total loans 6.39 % 5.82 %
Amounts non-performing 1,332,660 1,311,374
To the extent secured(1) 752,352 786,824
To the extent unsecured 580,308 524,550
Amounts non-performing as a percentage of total loans 3.26 % 3.17 %
To the extent secured(1) 1.84 % 1.90 %
To the extent unsecured 1.42 % 1.27 %
Loans loss allowances as a percentage of:
Total loans 2.99 % 2.89 %
Total amounts non-performing 91.73 % 90.95 %
Total amounts non-performing – unsecured 162.48 % 151.58 %
(1)Security generally consists of mortgages on real estate, pledges of marketable securities, letters of credit or cash.
Credit Ratios
The following sets forth our credit ratios as of and for the years ended December 2025, 2024 and 2023 by loan category.
2025 2024 2023
Allowance for credit losses to total loans outstanding 2.99 % 2.89 % 2.81 %
Allowance for credit losses 1,222,458 1,192,690 1,148,780
Total loans outstanding 40,932,880 41,323,844 40,811,886
Net write-offs during the period to average loans outstanding:
Commercial
Interbank Loans
Net charge-off during the period — — —
Average amount outstanding 30,886 13,862 34,163
Ratio of net charge-off/average amount outstanding — % — % — %
Commercial Loans
Net charge-off during the period 224,398 162,483 123,544
Average amount outstanding 13,329,553 13,142,288 13,794,651
Ratio of net charge-off/average amount outstanding 1.7 % 1.2 % 0.9 %
Foreign Trade Loans
Net charge-off during the period — — —
Average amount outstanding 1,927,226 1,867,465 1,828,177
Ratio of net charge-off/average amount outstanding — % — % — %
Checking Account Debtors
Net charge-off during the period 6,201 4,754 3,462
Average amount outstanding 118,610 134,335 137,208
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Ratio of net charge-off/average amount outstanding 5.2 % 3.5 % 2.5 %
Credit Cards Debtors
Net charge-off during the period 7,367 5,745 3,211
Average amount outstanding 145,335 132,904 130,806
Ratio of net charge-off/average amount outstanding 5.1 % 4.3 % 2.5 %
Factoring Transactions
Net charge-off during the period 6,722 6,142 889
Average amount outstanding 797,792 860,734 831,437
Ratio of net charge-off/average amount outstanding 0.8 % 0.7 % 0.1 %
Leasing Transactions
Net charge-off during the period 6,733 11,205 7,468
Average amount outstanding 1,032,553 1,160,926 1,287,533
Ratio of net charge-off/average amount outstanding 0.7 % 1.0 % 0.6 %
Student Loans
Net charge-off during the period 4,517 5,069 2,267
Average amount outstanding 34,232 42,702 50,103
Ratio of net charge-off/average amount outstanding 13.2 % 11.9 % 4.5 %
Other Loans and Accounts Receivable
Net charge-off during the period 43,995 42,266 14,670
Average amount outstanding 81,923 89,452 222,999
Ratio of net charge-off/average amount outstanding 53.7 % 47.2 % 6.6 %
Total Commercial
Net charge-off during the period 299,933 237,664 155,511
Average amount outstanding 17,498,110 17,444,668 18,317,077
Ratio of net charge-off/average amount outstanding 1.7 % 1.4 % 0.8 %
Residential
Loans with Mortgage Finance Bonds
Net charge-off during the period 10 7 24
Average amount outstanding 21 231 1,089
Ratio of net charge-off/average amount outstanding 47.6 % 3.0 % 2.2 %
Mortgage Mutual Loans financed with mortgage bonds
Net charge-off during the period — 15 7
Average amount outstanding 147,925 156,112 95,701
Ratio of net charge-off/average amount outstanding — % — % — %
Other Mortgage Loans
Net charge-off during the period 62,113 43,777 27,243
Average amount outstanding 17,318,748 17,188,479 16,217,279
Ratio of net charge-off/average amount outstanding 0.4 % 0.3 % 0.2 %
Total Residential
Net charge-off during the period 62,123 43,799 27,274
Average amount outstanding 17,466,694 17,344,822 16,314,069
Ratio of net charge-off/average amount outstanding 0.4 % 0.3 % 0.2 %
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2025 2024 2023
Consumer Loans
Installment Consumer Loans
Net charge-off during the period 261,938 263,450 205,066
Average amount outstanding 3,923,312 3,847,535 3,817,414
Ratio of net charge-off/average amount outstanding 6.7 % 6.8 % 5.4 %
Credit Card Balances
Net charge-off during the period 85,035 86,612 65,912
Average amount outstanding 1,925,812 1,692,456 1,541,871
Ratio of net charge-off/average amount outstanding 4.4 % 5.1 % 4.3 %
Consumer Leasing Contracts
Net charge-off during the period 12 59 45
Average amount outstanding 1,601 1,788 2,309
Ratio of net charge-off/average amount outstanding 0.7 % 3.3 1.9 %
Other Consumer Loans
Net charge-off during the period 2,820 3,293 3,139
Average amount outstanding 438 448 857
Ratio of net charge-off/average amount outstanding 643.8 % 735.0 % 366.3 %
Total Consumer
Net charge-off during the period 349,805 353,414 274,162
Average amount outstanding 5,851,163 5,542,227 5,362,451
Ratio of net charge-off/average amount outstanding 6.0 % 6.4 % 5.1 %
Total Loans
Net charge-off during the period 711,861 634,877 456,947
Average amount outstanding 40,815,967 40,331,717 39,993,597
Ratio of net charge-off/average amount outstanding 1.7 % 1.6 % 1.1 %
Deposits
The principal components of our deposits are savings accounts and time deposits and non-interest bearing demand deposits. For an analysis of average deposits for 2025 and 2024, see “—Average Balances, Income Earned from Interest-Earning Assets and Interest Paid on Interest-Bearing Liabilities.” The following table uses an estimate of uninsured time deposits which are not covered by the Chilean government guarantees as outlined in Item 4. Information on the Company – Deposit insurance.
For the year ended December 31,
2025 2024
(in millions of Ch$)
Insured deposits 698,698 719,804
Uninsured deposits 15,517,381 16,147,803
Of which:
Excess over guaranteed limit 3,136,574 3,118,264
Otherwise uninsured 12,380,807 13,029,539
Total 16,216,079 16,867,607
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For the year ended December 31,
Ch$ Foreign currency Total
(in millions of Ch$)
Time deposits otherwise uninsured with a maturity of:
3 months or less 7,967,364 2,512,422 10,479,786
Over 3 months through 6 months 1,717,636 405,165 2,122,801
Over 6 months through 12 months 2,149,743 293,766 2,443,509
Over 12 months 457,659 13,626 471,285
Total 12,292,402 3,224,979 15,517,381