Banco de Credito e Inversiones : Consolidated Financial Statements September, 2023 (English)

Interim Consolidated Financial Statements

As of September 30, 2023 and December 31, 2022 and for the nine and three months ended September 30, 2023 and 2022

CONTENT

Interim Consolidated Statements of Financial Position

Interim Consolidated Statements of Income

Interim Consolidated Statements of Other Comprehensive Income

Interim Consolidated Statements of Changes in Equity

Interim Consolidated Statements of Cash Flows

Notes to the Interim Consolidated Financial Statements

Table of contents
INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION	1
INTERIM CONSOLIDATED STATEMENTS OF INCOME	3
INTERIM CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME	4
INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY	5
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS	6
NOTE 1 - REPORTING ENTITY	8
NOTE 2 - BASIS OF ACCOUNTING	8
NOTE 3 - NEW ACCOUNTING PRONOUNCEMENTS ISSUED AND ADOPTED, OR ISSUED BUT NOT YET ADOPTED	29
NOTE 4 - ACCOUNTING CHANGES	32
NOTE 5 - SIGNIFICANT EVENTS	33
NOTE 6 - BUSINESS SEGMENTS	34
NOTE 7 - CASH AND CASH EQUIVALENTS	36
NOTE 8 - FINANCIAL ASSETS HELD FOR TRADING AT FAIR VALUE THROUGH PROFIT OR LOSS	36
NOTE 9 - FINANCIAL ASSETS NOT HELD FOR TRADING MANDATORILY MEASURED AT FAIR VALUE THROUGH PROFIT OR LOSS	37
NOTE 10 - FINANCIAL ASSETS AND LIABILITIES AT FAIR VALUE THROUGH PROFIT OR LOSS	37
NOTE 11 - FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME	38
NOTE 12 - FINANCIAL DERIVATIVES CONTRACT FOR ACCOUNTING HEDGE	39
NOTE 13 - FINANCIAL ASSETS AT AMORTIZED COST	44
NOTE 14 - INVESTMENTS IN COMPANIES	60
NOTE 15 - INTANGIBLE ASSETS	60
NOTE 16 - PROPERTY AND EQUIPMENT	62
NOTE 17 - RIGHT-OF-USE ASSETS AND LEASE LIABILITIES	63
NOTE 18 - CURRENT TAXES AND DEFERRED TAXES	64
NOTE 19 - OTHER ASSETS	66
NOTE 20 - NON-CURRENT ASSETS AND DISPOSAL GROUP HELD FOR SALE AND LIABILITIES INCLUDED IN DISPOSAL GROUP HELD FOR SALE	66
NOTE 21 - FINANCIAL LIABILITIES HELD FOR TRADING AT FAIR VALUE THROUGH PROFIT OR LOSS	67
NOTE 22 - FINANCIAL LIABILITIES AT AMORTIZED COST	68
NOTE 23 - REGULATORY CAPITAL FINANCIAL INSTRUMENTS ISSUED	73
NOTE 24 - PROVISIONS FOR CONTINGENCIES	74
NOTE 25 - PROVISIONS FOR DIVIDENDS, INTEREST PAYMENTS AND REVALUATION OF REGULATORY CAPITAL FINANCIAL INSTRUMENTS	75
NOTE 26 - SPECIAL PROVISIONS FOR CREDIT LOSS	75
NOTE 27 - OTHER LIABILITIES	77
NOTE 28 - EQUITY	77
NOTE 29 - CONTINGENCIES AND COMMITMENTS	80
NOTE 30 - INTEREST INCOME AND EXPENSES	82
NOTE 31 - INFLATION-INDEXATION INCOME AND EXPENSES	83
NOTE 32 - FEE INCOME AND EXPENSES	84
NOTE 33 - NET FINANCIAL INCOME (EXPENSE)	85
NOTE 34 - INCOME FROM INVESTMENTS IN COMPANIES	86
NOTE 36 - OTHER OPERATING INCOME AND EXPENSES	87
NOTE 37 - EXPENSES FOR EMPLOYEE BENEFITS	88
NOTE 38 - ADMINISTRATIVE EXPENSES	88
NOTE 39 - DEPRECIATION AND AMORTIZATION	89
NOTE 40 - IMPAIRMENT OF NON-FINANCIAL ASSETS	89
NOTE 41 - EXPENSES FOR CREDIT LOSSES	89
NOTE 42 - PROFIT OR LOSS FROM DISCONTINUED OPERATIONS	91
NOTE 43 - RELATED PARTIES DISCLOSURES	92
NOTE 44 - FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES	96
NOTE 45 - MATURITY OF FINANCIAL ASSETS AND LIABILITIES AS PER THEIR REMAINING TERMS	99
NOTE 46 - FINANCIAL AND NON-FINANCIAL ASSETS AND LIABILITIES BY CURRENCY	100
NOTE 47 - RISK MANAGEMENT AND REPORTING	102
NOTE 48 - INFORMATION ON REGULATORY CAPITAL AND CAPITAL ADEQUACY RATIOS	124
NOTE 49 - SUBSEQUENT EVENTS	126

BANCO DE CRÉDITO E INVERSIONES AND SUBSIDIARIES

INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

As of September 30, 2023 and December 31, 2022

(In millions of Chilean pesos - MCh$)

		September 30,	December 31,
		2023	2022
	Note	MCh$	MCh$
ASSETS
Cash and bank deposits	7	3,804,705	4,256,396
Transactions in the course of collection	7	641,205	404,209
Financial assets held for trading at fair value through profit or loss		7,754,969	7,680,615
Financial derivative contracts	8	6,673,204	6,770,653
Debt financial instruments	8	993,204	770,101
Other	8	88,561	139,861
Financial assets not held for trading mandatorily measured at fair value through profit or loss	9	48,679	71,282
Financial assets at fair value through profit or loss	10	-	-
Financial assets at fair value through other comprehensive income		10,226,620	10,477,361
Debt financial instruments	11	10,226,620	10,477,361
Other	11	-	-
Financial derivative contracts for accounting hedge	12	2,077,582	1,788,851
Financial assets at amortized cost		52,821,177	49,830,891
Rights for reverse repurchase agreements and securities lending	13	216,166	182,061
Debt securities	13	3,748,946	3,581,998
Loans and advances to banks	13	739,142	767,700
Loans and receivables from customers - Commercial	13	31,731,967	29,276,944
Loans and receivables from customers - Mortgage	13	13,532,472	12,809,381
Loans and receivables from customers - Consumer	13	2,852,484	3,212,807
Investments in companies	14	179,294	175,736
Intangible assets	15	427,463	411,009
Property and equipment	16	250,513	249,105
Right-of-use assets	17	142,864	152,886
Current tax assets	18	151,354	138,066
Deferred tax assets	18	471,820	482,714
Other assets	19	1,891,500	1,895,064
Non-current assets and disposal groups held for sale	20	43,404	34,934
TOTAL ASSETS		80,933,149	78,049,119

The accompanying notes Nos. 1 to 49 are an integral part of these Interim Consolidated Financial Statements

Interim Consolidated Financial Statements September 2023 / 1

BANCO DE CRÉDITO E INVERSIONES AND SUBSIDIARIES

INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

As of September 30, 2023 and December 31, 2022

(In millions of Chilean pesos - MCh$)

		September 30,	December 31,
		2023	2022
	Note	MCh$	MCh$
LIABILITIES
Transactions in the course of payment	7	580,011	330,138
Financial liabilities held for trading at fair value through profit or loss	21	6,222,461	6,584,736
Financial derivative contracts	21	6,222,461	6,584,736
Other	21	-	-
Financial liabilities designated at fair value through profit or loss	10	-	-
Financial derivative contracts for accounting hedge	12	2,575,932	2,590,468
Financial liabilities at amortized cost		62,257,908	59,760,444
Deposits and other on-demand liabilities	22	23,771,943	24,122,165
Deposits and other term deposits	22	20,797,237	18,245,965
Liabilities for repurchase agreements and securities lending	22	667,367	384,883
Bank borrowings	22	6,966,703	6,661,071
Debt financial instruments issued	22	8,012,426	8,107,260
Other financial liabilities	22	2,042,232	2,239,100
Lease liabilities	17	127,957	136,448
Regulatory capital financial instruments issued	23	1,536,927	1,499,299
Provisions for contingencies	24	152,436	227,716
Provisions for dividends, payment of interests and revaluation of regulatory capital financial
instruments issued	25	150,576	246,247
Special provisions for credit loss	26	503,715	491,055
Current taxes	18	10,014	17,493
Deferred taxes	18	2,368	1,612
Other liabilities	27	1,517,586	1,386,662
Liabilities included in disposal groups held for sale	20	-	-
TOTAL LIABILITIES		75,637,891	73,272,318
EQUITY
Share capital	28	4,768,410	4,225,332
Reserves	28	-	(26,640)
Accumulated other comprehensive income	28	174,051	2,211
Items that will not be reclassified to profit or loss	28	127	(182)
Items that may be reclassified to profit or loss	28	173,924	2,393
Retained earnings from prior years	28	-	-
Profit for the period/year	28	501,921	820,822
Less: Provisions for dividends, payment of interests and revaluation of regulatory capital financial	28		(246,247)
instruments issued	(150,576)
Owners of the bank	28	5,293,806	4,775,478
Non-controlling interests	28	1,452	1,323
TOTAL EQUITY		5,295,258	4,776,801
TOTAL LIABILITIES AND EQUITY		80,933,149	78,049,119

The accompanying notes Nos. 1 to 49 are an integral part of these Interim Consolidated Financial Statements

Interim Consolidated Financial Statements September 2023 / 2

BANCO DE CRÉDITO E INVERSIONES AND SUBSIDIARIES

INTERIM CONSOLIDATED STATEMENTS OF INCOME

For the nine and three-month periods ended September 30, 2023 and 2022 (In millions of Chilean pesos - MCh$)

		For the nine months ended	For the three months ended
		September 30	September 30
		2023	2022	2023	2022
	Note	MCh$	MCh$	MCh$	MCh$
Interest income		3,055,601	1,984,793	1,075,653	817,910
Interest expenses		(1,900,441)	(832,557)	(692,307)	(416,891)
Net interest income	30	1,155,160	1,152,236	383,346	401,019
Inflation-indexation income		617,052	1,122,673	139,321	401,778
Inflation-indexation expenses		(305,258)	(552,495)	(47,835)	(224,948)
Net inflation-indexation income	31	311,794	570,178	91,486	176,830
Fee income		379,854	381,894	129,915	129,701
Fee expense		(125,556)	(107,219)	(41,827)	(36,509)
Net fee income	32	254,298	274,675	88,088	93,192
Finance income for:
Financial assets and liabilities held for trading		114,275	23,084	114,839	(62,552)
Non-trading financial assets mandatorily measured at fair value through profit or loss		(27,215)	(12,670)	(20,874)	(12,670)
Financial assets and liabilities designated at fair value through profit or loss		-	-	-	-
Income arising from derecognition of financial assets and liabilities measured at amortized cost and
financial assets measured at fair value through other comprehensive income		(7,481)	3,523	(7,618)	3,523
Foreign currency changes, inflation-indexation, and hedge accounting		(31,748)	(79,656)	(103,336)	51,187
Reclassification of financial assets due to change in business model		-	-	-	-
Other finance income		-	-	-	-
Net finance income (expense)	33	47,831	(65,719)	(16,989)	(20,512)
Income from investments in companies	34	10,838	4,698	3,816	1,254
Income from non-current assets and disposal groups held for sale not admissible as discontinued
operations	35	7,799	6,891	2,138	715
Other operating income	36	40,152	40,670	24,548	13,982
TOTAL OPERATING INCOME		1,827,872	1,983,629	576,433	666,480
Expenses for employee benefit obligations	37	(482,430)	(472,102)	(164,586)	(168,812)
Administrative expenses	38	(337,607)	(289,610)	(117,949)	(103,250)
Depreciation and amortization	39	(83,820)	(84,727)	(28,371)	(28,955)
Impairment of non-financial assets	40	(7)	-	-	-
Other operating expenses	36	13,803	(43,306)	18,323	(27,203)
TOTAL OPERATING EXPENSES		(890,061)	(889,745)	(292,583)	(328,220)
OPERATING INCOME BEFORE CREDIT LOSSES		937,811	1,093,884	283,850	338,260
Credit loss expense for:
Provisions for credit loss of loans and advances to banks and loans and receivables from customers		(358,711)	(331,480)	(78,206)	(104,587)
Special provisions for credit loss		(12,082)	(61,465)	(19,272)	(6,168)
Recovery of written-off credits		57,208	61,271	19,848	19,172
Impairment due to credit loss of other financial assets at amortized cost and financial assets at fair value
through other comprehensive income		(12,559)	(15,080)	(6,842)	3,109
Credit loss expense	41	(326,144)	(346,754)	(84,472)	(88,474)
OPERATING PROFIT		611,667	747,130	199,378	249,786
Profit from continuing operations before tax		611,667	747,130	199,378	249,786
Income tax	18	(109,645)	(116,743)	(70,201)	(60,327)
Profit from continuing operations after tax		502,022	630,387	129,177	189,459
Profit from discontinued operations before tax		-	-	-	-
Discontinued operations tax	42	-	-	-	-
Profit from discontinued operations after tax		-	-	-	-
CONSOLIDATED PROFIT FOR THE PERIOD		502,022	630,387	129,177	189,459
Attributable to:
Owners of the Bank		501,921	630,266	129,146	189,414
Non-controlling interests		101	121	31	45
Earnings per share:
Basic earnings		3,302	3,733	1,094	905
Diluted earnings		3,302	3,733	1,094	905

The accompanying notes Nos. 1 to 49 are an integral part of these Interim Consolidated Financial Statements.

Interim Consolidated Financial Statements September 2023 / 3

BANCO DE CRÉDITO E INVERSIONES AND SUBSIDIARIES

INTERIM CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME

For the nine and three-month periods ended September 30, 2023 and 2022 (In millions of Chilean pesos - MCh$)

CONSOLIDATED PROFIT FOR THE PERIOD

Other comprehensive income from the period:

ITEMS THAT WILL NOT BE RECLASSIFIED TO PROFIT OR LOSS

Remeasurements of defined benefit liability (asset) and actuarial results for other employee benefit plans

Changes in fair value of equity instruments at fair value through other comprehensive income

Movements in fair value of financial liabilities at fair value through profit or loss attributable to changes in the credit risk of the financial liability

Other

OTHER COMPREHENSIVE INCOME THAT WILL NOT BE RECLASSIFIED TO INCOME BEFORE TAX

Income tax on other comprehensive income that will not be reclassified to profit or loss

TOTAL OTHER COMPREHENSIVE INCOME THAT WILL NOT BE RECLASSIFIED TOPROFIT OR LOSS

AFTER TAX

ITEMS THAT MAY BE RECLASSIFIED TO PROFIT OR LOSS

Changes in fair value of financial assets at fair value through other comprehensive income Translation differences for foreign operations

Hedge of net investments in foreign operations Cash flow hedges

Undesignated items of accounting hedge instruments Other

OTHER COMPREHENSIVE INCOME THAT MAY BE RECLASSIFIED TO PROFIT OR LOSS BEFORE TAX

Income tax on other comprehensive income that may be reclassified to profit or loss

TOTAL OTHER COMPREHENSIVE INCOME THAT MAY BE RECLASSIFIED TO PROFIT OR LOSS AFTER

TAX

TOTAL OTHER COMPREHENSIVE INCOME FOR THE PERIOD

COMPREHENSIVE INCOME FOR THE CONSOLIDATED PERIOD

Attributable to:

Owners of the Bank

Non-controlling interests

		For the nine months	For the three months ended
		ended September 30	September 30
		2023	2022	2023	2022
Note		MCh$	MCh$	MCh$	MCh$
	502,022	630,387	129,177	189,459

28	-	-	-		-
28	309	(71)	(15)	(16)
	-	-	-		-
	-	-	-		-
		309	(71)	(15)		(16)
	-	-	-		-
		309	(71)	(15)		(16)
28
28	(58,611)	(518,242)	(118,860)	(276,845)
28	107,817	292,077	207,100		144,886
	-	-	-		-
28	165,184	9,339	128,091		235,865
	-	-	-		-
	-	-	-		-
		214,390	(216,826)	216,331		103,906
28
28	(42,859)	165,383	(23,728)	(6,063)
		171,531	(51,443)	192,603		97,843
28
	171,840	(51,514)	192,588		97,827
	673,862	578,873	321,765		287,286
	673,761	578,752	321,734		287,241
	101	121	31		45

The accompanying notes Nos. 1 to 49 are an integral part of these Interim Consolidated Financial Statements

Interim Consolidated Financial Statements September 2023 / 4

BANCO DE CRÉDITO E INVERSIONES AND SUBSIDIARIES

INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

For the periods ended September 30, 2023 and December 31, 2022

(In millions of Chilean pesos - MCh$)

						Equity attributable to owners
				Re-measurement of net	Net changes in fair value of	Accumulated other comprehensive income						Retained earnings
				Changes in fair value of	Translation						Profit for	Provision for		Non-
				equity instruments at fair					Retained		Total
		Share capital	Reserves	defined benefit	financial assets at fair value	differences for	Cash flow hedges	Income tax	Total	the year	minimum	Total	controlling
		value through other	earnings	equity
				liabilities (assets)	through other comprehensive	foreign operations						dividends		interests
				comprehensive income
					income
		MCh$	MCh$	MCh$	MCh$	MCh$	MCh$		MCh$	MCh$	MCh$	MCh$	MCh$	MCh$	MCh$	MCh$	MCh$
Closing balances as of December 31, 2021		3,862,386	(26,806)	-	-	(242,905)	405,367		177,037	(36,959)	302,540	-	520,391	(156,117)	4,502,394	1,400	4,503,794
Effects of changes in accounting compendium			3,706			(13,285)					(13,285)	-	-	-	(9,579)	-	(9,579)
As of January 1, 2022		3,862,386	(23,100)	-	-	(256,190)	405,367		177,037	(36,959)	289,255	-	520,391	(156,117)	4,492,815	1,400	4,494,215
Transfer to retained earnings	-	-	-	-	-	-		-	-	-	520,391	(520,391)	-	-	-	-
Other equity movements	-	(3,540)	-	-	-	-		-	-	-	-	-	-	(3,540)	(279)	(3,819)
Common shares issued with release of capitalization payment	362,946	-	-	-	-	-		-	-	-	(362,946)	-	-	-	-	-
Additions to paid-in capital by capitalization without issue
of common shares released from paymen	-	-	-	-	-	-		-	-	-	-	-	-	-	-	-
Payment of ordinary share dividends	-	-	-	-	-	-		-	-	-	(157,445)	-	156,117	(1,328)	-	(1,328)
Provision for payment of ordinary share dividends	-	-	-	-	-	-		-	-	-	-	-	(246,247)	(246,247)	-	(246,247)
Subtotal of transactions with the owners in the period		4,225,332	(26,640)	-	-	(256,190)	405,367		177,037	(36,959)	289,255	-	-	(246,247)	4,241,700	1,121	4,242,821
Profit for the year	-	-	-	-	-	-		-	-	-	-	820,822	-	820,822	202	821,024
Other comprehensive income	-	-	(132)	(50)	(384,996)	(19,997)		(36,129)	154,260	(287,044)	-	-	-	(287,044)	-	(287,044)
Subtotal comprehensive income		-	-	(132)	(50)	(384,996)	(19,997)		(36,129)	154,260	(287,044)	-	820,822	-	533,778	202	533,980
Closing balance as of December 31, 2022		4,225,332	(26,640)	(132)	(50)	(641,186)	385,370		140,908	117,301	2,211	-	820,822	(246,247)	4,775,478	1,323	4,776,801
Transfer to retained earnings		-	-	-	-	-	-		-	-	-	820,822	(820,822)	-	-	-	-
Other equity movements	-	-	-	-	-	-		-	-	-	-	-	-	-	28	28
Common shares subscribed and fully paid	2,152	-	-	-	-	-		-	-	-	-	-	-	2,152	-	2,152
Common shares issued with release of capitalization payment	540,926	26,640	-	-	-	-		-	-	-	(567,566)	-	-	-	-	-
Additions to share capital for capitalization without issuance of											-				-		-
fully paid ordinary shares	-	-	-	-	-	-		-	-	-	-	-	-
Payment of ordinary share dividends	-	-	-	-	-	-		-	-	-	(253,256)	-	246,247	(7,009)	-	(7,009)
Provision for payment of ordinary share dividends	-	-	-	-	-	-		-	-	-	-	-	(150,576)	(150,576)	-	(150,576)
Subtotal of transactions with the owners in the period		4,768,410	-	(132)	(50)	(641,186)	385,370		140,908	117,301	2,211	-	-	(150,576)	4,620,045	1,351	4,621,396
Profit for the period	-	-	-	-	-	-		-	-	-	-	501,921	-	501,921	101	502,022
Other comprehensive income	-	-	-	309	(58,611)	107,817		165,184	(42,859)	171,840	-	-	-	171,840	-	171,840
Subtotal comprehensive income	-	-	-	309	(58,611)	107,817		165,184	(42,859)	171,840	-	501,921	-	673,761	101	673,862
Closing balance as of September 30, 2023	4,768,410	-	(132)	259	(699,797)	493,187		306,092	74,442	174,051	-	501,921	(150,576)	5,293,806	1,452	5,295,258

The accompanying notes Nos. 1 to 49 are an integral part of these Interim Consolidated Financial Statements

Interim Consolidated Financial Statements September 2023 / 5

BANCO DE CRÉDITO E INVERSIONES AND SUBSIDIARIES

INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS

For the periods ended September 30, 2023 and 2022

(In millions of Chilean pesos - MCh$)

September 30,

		2023	2022
	Note	MCh$	MCh$
A) CASH FLOWS FROM OPERATING ACTIVITIES
CONSOLIDATED PROFIT BEFORE TAX FOR THE PERIOD ENDED		611,667	747,130
Debit (credit) to profit or loss that do not represent movements in cash flows
Depreciation and amortization	39	83,820	84,727
Impairment of non-financial assets	40	(7)	-
Provisions for credit loss		370,793	392,945
Adjustment to market value of financial instruments		(23,936)	27,396
Net loss on investment in companies	34	(10,838)	(4,698)
Net loss on sale of assets received in payment	35	(2,036)	2
Net loss on sale of property and equipment	35	(518)	(241)
Net gain on sale of property and equipment	35	1	253
Write-off of assets received in payment	35	1,369	629
Net interest income	30	(1,155,160)	(1,152,236)
Net inflation-indexation income	31	(311,794)	(570,178)
Net fee income	32	(254,298)	(274,675)
Other debit (credit) that do not represent movements in cash flows		254,799	82,417
Changes due to increases/decreases in operating assets and liabilities:
(Increase) decrease in loans and advances to banks		34,260	(282,125)
(Increase) decrease in loans and receivables from customers		(2,957,759)	(5,781,122)
(Increase) decrease in financial investments		(942,636)	(867,592)
Increase (decrease) in other on-demand liabilities		(349,780)	(440,922)
Increase (decrease) in repurchase agreements and securities lending		347,648	221,414
Increase (decrease) in deposits and other term deposits		2,399,830	5,068,415
Increase (decrease) in bank borrowings		(91,196)	(124,679)
Increase (decrease) in other financial liabilities		(201,210)	1,447,238
Loans from the Central Bank of Chile (long-term)		47,878	-
Repayment of loans from the Central Bank of Chile (long term)		-	(74,965)
Long-term foreign loans		342,712	-
Repayment of long-term foreign loans		-	(140,716)
Income tax		(97,982)	(156,763)
Interest and inflation-indexation received		3,672,653	3,107,466
Interest and inflation-indexation paid		(2,205,699)	(1,385,052)
Fees received	32	379,854	381,894
Fees paid	32	(125,555)	(107,219)
Total net cash (used in) from operating activities		(183,120)	198,743
B) CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of investments in companies	14	-	-
Sale of investments in companies	14	-	1,319
Dividends received from investments in companies	14	2,745	99
Acquisition of property and equipment	16	(13,747)	(12,411)
Sale of property and equipment		333	1,700
Acquisition of intangible assets	15	(63,937)	(44,847)
Sale of intangible assets		-	-
Sale of goods received in payment or awarded		8,037	5,669
Net (increase) in other assets and liabilities		(398,809)	(871,781)
Total net cash (used in) investing activities		(465,378)	(920,252)

The accompanying notes Nos. 1 to 49 are an integral part of these Interim Consolidated Financial Statements

Interim Consolidated Financial Statements September 2023 / 6

BANCO DE CRÉDITO E INVERSIONES AND SUBSIDIARIES

INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS

For the periods ended September 30, 2023 and 2022

(In millions of Chilean pesos - MCh$)

September 30,

		2023	2022
	Note	MCh$	MCh$
C) CASH FLOWS FROM FINANCING ACTIVITIES
Attributable to interest of the owners:
Issue of letters of credit		-	-
Redemption and payment of interest / principal of letters of credit		(988)	(2,756)
Issuance of current bonds		497,307	1,080,579
Redemption and payment of interest / principal of current bonds		(821,909)	(1,185,755)
Issue of mortgage bonds		-	-
Redemption and payment of interest / principal of mortgage bonds		-	-
Payment of interest / principal of lease liabilities		(2,080)	(2,194)
Issue of subordinated bonds		-	-
Payment of interest and principal of subordinated bonds		(47,661)	(39,579)
Issue of bonds with no fixed maturity date		-	-
Redemption and payment of interest on bonds with no fixed maturity date		-	-
Issue of preferred shares		-	-
Redemption of preference shares and payment of preference share dividends		-	-
Increase in share capital for the issuance of ordinary shares		2,152	-
Payment of ordinary shares dividends		(253,256)	(157,445)
Attributable to non-controlling interests:
Dividend payment and/or withdrawals of share capital related to subsidiaries corresponding to		-
non-controlling interest		-
Total net cash used in financing activities		(626,435)	(307,150)
NET DECREASE IN CASH AND CASH EQUIVALENTS FOR THE PERIOD ENDED		(1,126,135)	(751,774)
EFFECT OF EXCHANGE RATE FLUCTUATIONS		(148,798)	(276,885)
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD		7,309,538	6,820,120
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD	7	6,034,605	5,791,461

The accompanying notes Nos. 1 to 49 are an integral part of these Interim Consolidated Financial Statements

Interim Consolidated Financial Statements September 2023 / 7

BANCO DE CRÉDITO E INVERSIONES AND SUBSIDIARIES

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

As of September 30, 2023 and December 31, 2022 and for the nine and three-month periods ended September 30, 2023 and 2022

NOTE 1 - REPORTING ENTITY

1. The Bank

Banco de Crédito e Inversiones (hereinafter "BCI" or "the Bank") is a company incorporated in Chile, regulated by the Financial Market Commission, hereinafter the "CMF", in accordance with the amendments to the General Banking Law under Law No. 21.130, which defines this commission as regulatory entity from June 1, 2019 (Official Gazette Publication No. 42.343 of Thursday, May 2, 2019). Its registered office is at Avenida El Golf 125, in the municipality of Las Condes. The Interim Consolidated Financial Statements as of September 30, 2023 and December 31, 2022 and for the nine and three months ended as of September 30, 2023 and 2022, include the Bank and its subsidiaries detailed in the following paragraph, as well as the Miami Branch. The Bank is involved in all the businesses and operations that the General Banking Law allows it, as personal, corporate, and real estate banking, large and medium-sized companies banking, private banking, and asset management services.

NOTE 2 - BASIS OF ACCOUNTING

1. Basis of preparation of the interim financial statements

These Interim Consolidated Financial Statements have been prepared in accordance with the Compendium of Accounting Standards for Banks (CNCB) and instructions issued by the Financial Market Commission (hereinafter "CMF"), a regulatory body that in accordance with Law No. 21.000 that " Creates the Financial Market Commission", provides in number 6 of article 5 that the Financial Market Commission may "set the standards for the preparation and presentation of the annual reports, balance sheets, statements of financial position and other financial statements of the regulated entities and determine the principles to which they must keep their accounting and in everything that is not treated by it if it does not contradict their instructions, they must adhere to the generally accepted accounting policies, which correspond to the technical standards issued by Colegio de Contadores de Chile AG, matching the International Financial Reporting Standards (IFRS) agreed upon by the International Accounting Standards Board (IASB). In case of discrepancies between the International Financial Reporting Standards (IFRS) and the accounting policies issued by the CMF in its Compendium of Accounting Standards for Banks and Instructions, the latter will prevail.

The notes to the Interim Consolidated Financial Statements contain additional information to that presented in the Interim Consolidated Statements of Financial Position, the Interim Consolidated Statements of Income, the Interim Consolidated Statements of Other Comprehensive Income, the Interim Consolidated Statements of Changes in Equity and the Interim Consolidated Statements of Cash Flows.

1. Controlled entities (subsidiaries)

The Interim Consolidated Financial Statements as of September 30, 2023 and December 31, 2022 include the financial statements of the Bank and the controlled companies (subsidiaries). Control is obtained when the Bank is exposed, or has the right, to variable returns from its involvement with the investee and has the ability to influence those returns through its power over the investee.

Specifically, the Bank controls an investee only if it meets the following elements:

1. Power over the investee (that is, it has rights that give it the current ability to direct the relevant activities of the investee);

1. exposure, or right, to variable returns from its involvement with the investee; and

III. ability to use its power over the investee to influence the amount of the investor's returns.

When the Bank has less than most of the voting rights over an investee; but such voting rights are sufficient to have the practical ability to direct the relevant activities unilaterally, then it will be concluded that the Bank has control. The Bank considers all relevant factors and circumstances in assessing whether the voting rights are sufficient to obtain control, these include:

●

●

●

●

The size of the Bank's voting rights relative to the size and dispersion of holdings of the other vote holders. The potential voting rights held by the investor, other vote holders or other parties.

Rights arising from other contractual arrangements.

Any additional facts and circumstances that indicate the investor has, or does not have, the current ability to direct the relevant activities at the time those decisions need to be made, including voting patterns at previous shareholders' meetings.

The Bank reassesses whether it has control over an investee when the facts or circumstances indicate that there are changes in one or more of the control elements listed above.

Loss of control generates de-recognition of assets and liabilities of the former subsidiary in the Interim Consolidated Statements of Financial Position and the recognition of the loss or gain associated with the loss of control.

The Interim Consolidated Financial Statements consider the separate (stand-alone) financial statements of the Bank and of the companies included in the consolidation and include the necessary adjustments and reclassifications to standardize the accounting policies and valuation criteria applied by the Bank, together with the elimination of all balances and transactions between the consolidated companies.

Additionally, the participation of third parties in the equity of the consolidated Bank is presented as "non-controlling interest" in the Interim Consolidated Statements of Financial Position. Their share of profits for the period is presented as "Profit attributable to non-controlling interest" in the Interim Consolidated Statements of Income for the period.

The following table shows the composition of the entities over which the Bank can exercise control, therefore, they are part of the scope of consolidation:

Interim Consolidated Financial Statements September 2023 / 8