Report of 2Q2020 consolidated results

Information reported in Ps billions(1) and under IFRS

(1) We refer to billions as thousands of millions.

Disclaimer

Grupo Aval Acciones y Valores S.A. ("Grupo Aval") is an issuer of securities in Colombia and in the United States.. As such, it is subject to compliance with securities regulation in Colombia and applicable U.S. securities regulation. Grupo Aval is also subject to the inspection and supervision of the Superintendency of Finance as holding company of the Aval financial conglomerate.

The consolidated financial information included in this document is presented in accordance with IFRS as currently issued by the IASB. Details of the calculations of non-GAAP measures such as ROAA and ROAE, among others, are explained when required in this report.

This report includes forward-looking statements. In some cases, you can identify these forward-looking statements by words such as "may," "will," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential," or "continue," or the negative of these and other comparable words. Actual results and events may differ materially from those anticipated herein as a consequence of changes in general, economic and business conditions, changes in interest and currency rates and other risk described from time to time in our filings with the Registro Nacional de Valores y Emisores and the SEC.

Recipients of this document are responsible for the assessment and use of the information provided herein. Matters described in this presentation and our knowledge of them may change extensively and materially over time but we expressly disclaim any obligation to review, update or correct the information provided in this report, including any forward looking statements, and do not intend to provide any update for such material developments prior to our next earnings report.

The content of this document and the figures included herein are intended to provide a summary of the subjects discussed rather than a comprehensive description.

When applicable, in this document we refer to billions as thousands of millions.

1

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS, except per share information

Bogotá, August 27th, 2020. Grupo Aval S.A. (NYSE:AVAL) reported a consolidated attributable net income for 2Q2020 of Ps 323.4 billion or $14.5 pesos per share. ROAE was 6.6% and ROAA was 0.8% for the quarter.

Key results of the quarter:

  • Grupo Aval closed on the Multi Financial Group (MFG) acquisition in Panama during the month of May.
  • The acquisition represented a one-time increase in consolidated total assets of approximately Ps 18.6 trillion (USD 5.0 billion) and in consolidated total liabilities of approximately Ps 16.7 trillion (USD 4.4 billion).
  • Including the acquisition of MFG, Aval´s consolidated assets grew by 25.8% in the last twelve months to Ps 333 trillion.
  • Consolidated gross loans grew in the last twelve months to Ps 209 trillion, or 22.6%, including the MFG acquisition.
  • Consolidated deposits grew in the last twelve months to Ps 212 trillion, or 27.8%, including the MFG acquisition.
  • Cost of risk during the semester increased significantly to 2.7%, when compared to 2.1% during the first semester of 2019 and 2.3% during the second semester of last year. 40 to 50% of loan provisions booked during this quarter were Covid-related.
  • Total NIM during the semester was 5.1%, a decrease of almost 70 bps versus total NIM during the first half of 2019, and of 60 bps versus total NIM recorded during the second half of last year. However, total NIM during the second quarter of 2020 improved by 50bps versus total NIM during the first quarter, driven by a 456 bps increase in NIM on Investments.
  • Although gross fee income during the first semester was in line with gross fee income during the first semester of last year, a sharp decrease (-19%) was recorded in fee income from banking activities versus the previous quarter, mostly related to the region's quarantine that resulted in a material decrease in credit card usage.
  • Income from non-financial sector operations contracted by 8.6% versus the first half of 2019 and by 10.6% versus the second semester of 2019, mainly driven by a contraction in revenues from infrastructure investments, which decreased by 8.9% and 11.7% versus the first and second semesters of 2019. This decrease was driven by the lockdown in Colombia that halted construction in our 4G concessions; however, the Government has already lifted most restrictions and construction has restarted.
  • We continue to observe strong funding and liquidity positions, as evidenced by the Deposits/Net Loans ratio of 1.04x and the Cash/Deposits ratio of 18.9%.
  • As a result, ROAA and ROAE for the semester were 1.3% and 10.4% respectively.

2

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS, except per share information

Bogotá, August 27th, 2020. Grupo Aval S.A. (NYSE:AVAL) reported a consolidated attributable net income for 2Q2020 of Ps 323.4 billion or $14.5 pesos per share. ROAE was 6.6% and ROAA was 0.8% for the quarter.

COP $tn

2Q19

1Q20

2Q20

2Q20 vs

2Q20 vs

2Q19

1Q20

Gross Loans

$ 170.7

$ 200.7

$ 209.3

22.6%

4.3%

Balance

Deposits

$ 166.0

$ 203.2

$ 212.2

27.8%

4.4%

Sheet

Deposits/Net Loans

1.00 x

1.04 x

1.04 x

0.05 x

0.00 x

90 days PDLs / Total

3.2%

3.1%

3.0%

(22) bps

(15) bps

loans

Loan Quality

Allowance/90 days

1.53 x

1.41 x

1.53 x

0.00 x

0.12 x

PDLs

Cost of risk

2.2%

2.2%

3.1%

87 bps

94 bps

Net interest margin

5.9%

4.8%

5.3%

(56) bps

50 bps

Fee income Ratio

25.4%

24.6%

21.4%

(396) bps

(315) bps

Profitability

Efficiency Ratio

45.4%

47.1%

51.3%

593 bps

428 bps

Attributable net

$ 0.81

$ 0.70

$ 0.32

-60.2%

-53.8%

income

ROAA

2.1%

1.8%

0.8%

(136) bps

(101) bps

ROAE

18.3%

14.2%

6.6%

(1,169) bps

(768) bps

Gross loans excludes interbank and overnight funds. PDLs 90+ defined as loans more than 90 days past due. Net Interest Margin includes net interest income plus net trading income from debt and equity investments at FVTPL divided by total average interest-earning assets. Fee income ratio is calculated as net income from commissions and fees divided by net interest income plus net income from commissions and fees, gross profit from sales of goods and services, net trading income, net income from other financial instruments mandatory at FVTPL and total other income. Efficiency Ratio is calculated as total other expenses divided by net interest income plus net income from commissions and fees, gross profit from sales of goods and services, net trading income, net income from other financial instruments mandatory at FVTPL and total other income. ROAA is calculated as annualized Net Income divided by average of total assets. ROAE is calculated as Net Income attributable to Aval's shareholders divided by average attributable shareholders' equity. NS refers to non-significant figures.

3

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

Grupo Aval Acciones y Valores S.A.

Consolidated Financial Statements Under IFRS

Information in Ps. Billions

2Q19

1Q20

2Q20

Consolidated Statement of Financial Position

2Q19

1Q20

2Q20

2Q20 vs. 1Q20

2Q20 vs. 2Q19

Cash and cash equivalents

29,824.7

40,136.8

40,109.2

-0.1%

34.5%

Trading assets

7,702.0

11,478.9

11,204.1

-2.4%

45.5%

Investment securities

24,316.2

28,999.9

33,302.6

14.8%

37.0%

Hedging derivatives assets

44.4

206.0

129.0

-37.4%

190.8%

Total loans, net

166,401.3

195,066.3

203,303.0

4.2%

22.2%

Tangible assets

8,863.4

9,295.5

9,437.8

1.5%

6.5%

Goodwill

7,249.3

8,571.5

8,236.5

-3.9%

13.6%

Concession arrangement rights

6,429.4

8,068.4

8,154.6

1.1%

26.8%

Other assets

13,845.4

18,604.4

19,086.7

2.6%

37.9%

Total assets

264,676.1

320,427.8

332,963.5

3.9%

25.8%

Trading liabilities

568.3

3,016.1

1,196.5

-60.3%

110.6%

Hedging derivatives liabilities

76.7

770.9

310.6

-59.7%

N.A.

Customer deposits

166,000.8

203,221.5

212,216.0

4.4%

27.8%

Interbank borrowings and overnight funds

10,416.7

7,768.2

11,004.5

41.7%

5.6%

Borrowings from banks and others

20,278.7

25,511.2

26,570.5

4.2%

31.0%

Bonds issued

20,105.5

28,684.4

28,829.1

0.5%

43.4%

Borrowings from development entities

3,290.4

3,799.6

4,103.0

8.0%

24.7%

Other liabilities

13,336.0

14,625.6

14,572.4

-0.4%

9.3%

Total liabilities

234,073.0

287,397.4

298,802.7

4.0%

27.7%

Equity attributable to owners of the parent

18,310.6

19,472.2

19,939.8

2.4%

8.9%

Non-controlling interest

12,292.5

13,558.1

14,221.0

4.9%

15.7%

Total equity

30,603.1

33,030.3

34,160.8

3.4%

11.6%

Total liabilities and equity

264,676.1

320,427.8

332,963.5

3.9%

25.8%

Consolidated Statement of Income

2Q19

1Q20

2Q20

Interest income

4,885.8

5,097.5

5,199.9

2.0%

6.4%

Interest expense

2,054.4

2,172.0

2,246.4

3.4%

9.3%

Net interest income

2,831.3

2,925.5

2,953.6

1.0%

4.3%

Loans and other accounts receivable

1,040.9

1,101.4

1,642.1

49.1%

57.7%

Other financial assets

(33.2)

14.8

43.6

194.1%

N.A

Recovery of charged-off financial assets

(96.6)

(79.7)

(56.0)

-29.7%

-42.0%

Net impairment loss on financial assets

911.1

1,036.5

1,629.6

57.2%

78.9%

Net interest income, after impairment losses

1,920.2

1,889.0

1,323.9

-29.9%

-31.1%

Net income from commissions and fees

1,347.2

1,345.8

1,094.5

-18.7%

-18.8%

Gross profit from sales of goods and services

599.7

833.7

239.4

-71.3%

-60.1%

Net trading income

208.6

1,101.2

(93.6)

-108.5%

-144.9%

Net income from other financial instruments mandatory at FVTPL

53.4

73.3

59.7

-18.5%

11.7%

Total other income

266.1

(804.3)

853.2

N.A

N.A.

Total other expenses

2,409.2

2,576.4

2,621.6

1.8%

8.8%

Net income before income tax expense

1,986.1

1,862.3

855.6

-54.1%

-56.9%

Income tax expense

586.4

516.4

214.6

-58.4%

-63.4%

Net income for the period

1,399.7

1,345.8

641.0

-52.4%

-54.2%

Non-controlling interest

586.5

645.6

317.6

-50.8%

-45.8%

Net income attributable to owners of the parent

813.2

700.2

323.4

-53.8%

-60.2%

Key ratios

2Q19

1Q20

2Q20

YTD 2019

YTD 2020

Net Interest Margin(1)

5.7%

5.3%

5.0%

5.6%

5.2%

Net Interest Margin (including net trading income)(1)

5.9%

4.8%

5.3%

5.8%

5.1%

Efficiency ratio(2)

45.4%

47.1%

51.3%

45.1%

49.1%

ROAA(3)

2.1%

1.8%

0.8%

2.1%

1.3%

ROAE(4)

18.3%

14.2%

6.6%

17.7%

10.4%

90 days PDL / Gross loans (5)

3.2%

3.1%

3.0%

3.2%

3.0%

Provision expense / Average gross loans (6)

2.2%

2.2%

3.1%

2.1%

2.7%

Allowance / 90 days PDL (5)

1.53

1.41

1.53

1.53

1.53

Allowance / Gross loans

4.9%

4.4%

4.6%

4.9%

4.6%

Charge-offs / Average gross loans (6)

2.3%

1.9%

1.8%

2.4%

1.9%

Total loans, net / Total assets

62.9%

60.9%

61.1%

62.9%

61.1%

Deposits / Total loans, net

99.8%

104.2%

104.4%

99.8%

104.4%

Equity / Assets

11.6%

10.3%

10.3%

11.6%

10.3%

Tangible equity ratio (7)

8.7%

7.5%

7.6%

8.7%

7.6%

Shares outstanding (EoP)

22,281,017,159

22,281,017,159

22,281,017,159

22,281,017,159

22,281,017,159

Shares outstanding (Average)

22,281,017,159

22,281,017,159

22,281,017,159

22,281,017,159

22,281,017,159

Common share price (EoP)

1,295.0

1,100.0

935.0

1,295.0

935.0

Preferred share price (EoP)

1,285.0

897.0

830.0

1,285.0

830.0

BV/ EoP shares in Ps.

821.8

873.9

894.9

821.8

894.9

EPS

36.5

31.4

14.5

70.7

45.9

P/E (8)

8.8

7.1

14.3

9.1

9.0

P/BV (8)

1.6

1.0

0.9

1.6

0.9

  1. NIM is calculated as Net Interest Income divided by the average of Interest Earning Assets; (2) Efficiency Ratio is calculated as total other expenses divided by net interest income plus net income from commissions and fees, gross profit from sales of goods and services, net trading income, net income from other financial instruments mandatory at FVTPL and total other income; (3) ROAA is calculated as Income before Minority Interest divided by the average of total assets for each quarter; (4) ROAE is calculated as Net Income attributable to Grupo Aval's shareholders divided by the average of shareholders´ attributable equity for each quarter; (5) PDLs 90+ defined as loans more than 90 days past due include interest accounts receivables. Gross loans excluding interbank and overnight funds; (6) Refers to average gross loans for the period; (7) Tangible Equity Ratio is calculated as Total Equity minus Intangibles (excluding those related to concessions) divided by Total Assets minus Intangibles (excluding those related to concessions); (8) Based

4 on Preferred share prices.

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

Statement of Financial Position Analysis

1. Assets

Total assets as of June 30th, 2020 totaled Ps 332,963.5 billion showing an increase of 25.8% versus June 30th, 2019 and of 3.9% versus March 31st, 2020. Growth in assets was mainly driven by (i) an 22.2% year over year growth in loans, net to Ps 203,303.0 billion,(ii) a 34.5% year over year growth in cash and cash equivalents to Ps 40,109.2 billion and (iii) a 36.9% yearly growth for investment securities to Ps 33,302.6 billion. When excluding FX movement in our Central American operation ("excluding FX"), asset growth would have been 19.7% versus June 30th, 2019 and 6.5% versus March 31st, 2020; for total loans and receivables, net growth would have been 16.0% versus June 30th, 2019 and 7.0% versus March 31st, 2020; for cash and cash equivalents 26.3% and 3.0%; and for investment securities growth would have been 30.7% versus June 30th, 2019 and 17.5% versus March 31th, 2020.

Multi Financial Group contributed with Ps. 18.6 trillion in assets (USD 5.0 billion).

1.1 Loan portfolio

Gross loans (excluding interbank and overnight funds) increased by 22.6% between June 30th, 2019 and June 30sth, 2020 to Ps 209,292.9 billion (16.6% excluding FX) mainly driven by (i) a 25.6% increase in Commercial loans to Ps 118,617.5 billion (20.8% excluding FX), (ii) a 14.8% increase in Consumer loans to Ps 65,122.3 billion (8.5% excluding FX), and (iii) a 32.0% increase Mortgages loans to Ps 25,168.6 billion (20.6% excluding FX).

Multi Financial Group contributed with Ps. 12.7 trillion in gross loans (USD 3.4 billion). Ps. 7.1 trillion in commercial loans (USD 1.9 billion), Ps. 3.0 trillion in consumer loans (USD 0.8 billion) and Ps. 2.6 trillion in mortgages loans (USD 0.7 billion).

Interbank & overnight funds decreased by 13.1% to Ps 3,585.4 billion (-18.5% excluding FX) during the last twelve months.

Loss allowance was Ps 9,575.2 billion as of June 30th, 2020 taking net loans to Ps 203,303.0 billion.

Total loans, net

2Q19

1Q20

2Q20

2Q20 vs.

2Q20 vs.

1Q20

2Q19

Gross loans

Commercial loans

94,475.8

111,830.7

118,617.5

6.1%

25.6%

Consumer loans

56,705.3

65,205.6

65,122.3

-0.1%

14.8%

Mortgages loans

19,060.8

23,228.4

25,168.6

8.4%

32.0%

Microcredit loans

411.3

403.4

384.4

-4.7%

-6.5%

Gross loans

170,653.2

200,668.0

209,292.9

4.3%

22.6%

Interbank & overnight funds

4,123.6

3,282.2

3,585.4

9.2%

-13.1%

Total gross loans

174,776.8

203,950.2

212,878.3

4.4%

21.8%

Loss allowance

(8,375.5)

(8,883.9)

(9,575.2)

7.8%

14.3%

Allowance for impairment of commercial loans

(4,476.8)

(4,601.8)

(5,212.3)

13.3%

16.4%

Allowance for impairment of consumer loans

(3,488.9)

(3,783.5)

(3,843.9)

1.6%

10.2%

Allowance for impairment of mortgages

(323.6)

(406.5)

(429.6)

5.7%

32.8%

Allowance for impairment of microcredit loans

(86.2)

(92.1)

(89.5)

-2.8%

3.8%

Total loans, net

166,401.3

195,066.3

203,303.0

4.2%

22.2%

5

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

The following table shows the gross loan composition per product of each of our loan categories.

Gross loans

2Q19

1Q20

2Q20

2Q20 vs.

2Q20 vs.

1Q20

2Q19

General purpose

65,885.1

77,982.4

81,815.3

4.9%

24.2%

Working capital

14,801.8

18,611.7

21,197.9

13.9%

43.2%

Financial leases

9,958.0

10,838.2

10,747.4

-0.8%

7.9%

Funded by development banks

3,067.7

3,497.7

3,950.9

13.0%

28.8%

Overdrafts

456.4

544.3

635.5

16.7%

39.2%

Credit cards

306.7

356.3

270.5

-24.1%

-11.8%

Commercial loans

94,475.8

111,830.6

118,617.5

6.1%

25.6%

Payroll loans

24,656.5

28,098.7

28,630.9

1.9%

16.1%

Personal loans

10,418.2

11,409.6

11,451.6

0.4%

9.9%

Credit cards

15,395.8

18,770.1

17,095.3

-8.9%

11.0%

Automobile and vehicle

5,746.2

6,399.2

7,447.8

16.4%

29.6%

Financial leases

257.7

302.3

287.3

-5.0%

11.5%

Overdrafts

93.3

89.7

80.6

-10.2%

-13.6%

Other

137.6

136.0

128.8

-5.3%

-6.4%

Consumer loans

56,705.2

65,205.6

65,122.3

-0.1%

14.8%

Mortgages

17,643.1

21,602.7

23,510.1

8.8%

33.3%

Housing leases

1,417.7

1,625.6

1,658.5

2.0%

17.0%

Mortgages loans

19,060.8

23,228.4

25,168.6

8.4%

32.0%

Microcredit loans

411.3

403.4

384.4

-4.7%

-6.5%

Gross loans

170,653.1

200,668.0

209,292.9

4.3%

22.6%

Interbank & overnight funds

4,123.6

3,282.2

3,585.4

9.2%

-13.1%

Total gross loans

174,776.8

203,950.2

212,878.3

4.4%

21.8%

Over the last twelve months, commercial general purpose loans and payroll loans have driven our loan portfolio growth in accordance with our banks' strategies.

In Colombia, gross loans increased by 11.5% during the last twelve months and 1.0% during the quarter. As for Central America, loans and receivables grew by 48.4% between June 30th, 2019 and June 30th, 2020 and 10.5% in the last quarter; when excluding FX, growth would have been 26.6% and 19.3%, respectively.

Commercial loans grew by 25.6% over the year and 6.1% in the last quarter. In Colombia, commercial loans increased by 13.9% annually and 2.1% over the quarter. As for Central America, commercial loans grew by 64.6% over the year and 16.6% in the last quarter; when excluding FX, growth in Central America would have been 40.5% and 25.9%, respectively.

Consumer loans growth over the last year and quarter was mainly driven by payrolls loans. In Colombia, Consumer loans grew by 6.7% during the last twelve months and decreased 1.3% between March 31st , 2020 and June 30th, 2020 mainly in credit cards. Growth of our Central American operations was 30.6% over the year and 1.7% in the last quarter, excluding FX, growth would have been 11.5% during the last twelve months and 9.8% in the quarter.

6

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

The following table shows the loans and receivables composition per entity. During the last twelve months, Banco de Occidente showed the highest growth rate within our banking operation in Colombia, driven by a strong performance in all loan categories (commercial loans grew 18.2%, consumer loans grew 6.8% and mortgages grew 18.2%) .

Gross loans / Bank ($)

2Q19

1Q20

2Q20

2Q20 vs.

2Q20 vs.

1Q20

2Q19

Banco de Bogotá

109,904.9

134,807.7

141,757.5

5.2%

29.0%

Domestic

58,329.6

65,554.2

65,237.0

-0.5%

11.8%

Central America

51,575.3

69,253.5

76,520.5

10.5%

48.4%

Banco de Occidente

29,400.7

32,260.5

33,942.2

5.2%

15.4%

Banco Popular

19,280.8

20,767.5

21,469.1

3.4%

11.3%

Banco AV Villas

11,883.4

12,435.3

12,051.4

-3.1%

1.4%

Corficolombiana

1,761.3

2,000.4

1,821.3

-8.9%

3.4%

Eliminations

(1,578.0)

(1,603.5)

(1,748.7)

9.1%

10.8%

Gross loans

170,653.2

200,668.0

209,292.9

4.3%

22.6%

Interbank & overnight funds

4,123.6

3,282.2

3,585.4

9.2%

-13.1%

Total gross loans

174,776.8

203,950.2

212,878.3

4.4%

21.8%

Gross loans / Bank (%)

2Q19

1Q20

2Q20

Banco de Bogotá

64.4%

67.2%

67.7%

Domestic

34.2%

32.7%

31.2%

Central America

30.2%

34.5%

36.6%

Banco de Occidente

17.2%

16.1%

16.2%

Banco Popular

11.3%

10.3%

10.3%

Banco AV Villas

7.0%

6.2%

5.8%

Corficolombiana

1.0%

1.0%

0.9%

Eliminations

-0.9%

-0.8%

-0.8%

Gross loans

100%

100%

100%

Of the total loans and receivables, 63.1% are domestic and 36.9% are foreign. In terms of gross loans (excluding interbank and overnight funds), 63.4% are domestic and 36.6% are foreign (reflecting the Central American operations).

Gross loans

2Q19

1Q20

2Q20

2Q20 vs.

2Q20 vs.

1Q20

2Q19

Domestic

Commercial loans

72,716.9

81,115.8

82,806.2

2.1%

13.9%

Consumer loans

37,464.6

40,497.7

39,985.9

-1.3%

6.7%

Mortgages loans

8,485.0

9,397.6

9,595.8

2.1%

13.1%

Microcredit loans

411.3

403.4

384.4

-4.7%

-6.5%

Interbank & overnight funds

2,509.3

1,611.9

1,471.4

-8.7%

-41.4%

Total domestic loans

121,587.2

133,026.3

134,243.7

0.9%

10.4%

Foreign

Commercial loans

21,758.9

30,714.9

35,811.2

16.6%

64.6%

Consumer loans

19,240.6

24,707.9

25,136.4

1.7%

30.6%

Mortgages loans

10,575.8

13,830.7

15,572.8

12.6%

47.2%

Microcredit loans

-

-

-

-

-

Interbank & overnight funds

1,614.3

1,670.3

2,114.0

26.6%

31.0%

Total foreign loans

53,189.6

70,923.9

78,634.5

10.9%

47.8%

Total gross loans

174,776.8

203,950.2

212,878.3

4.4%

21.8%

7

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

The quality of our loan portfolio improved during the quarter.

Our 30 days PDL to total loans closed 2Q20 in 4.1%, compared to 4.2% in 1Q20 and 4.5% in 2Q19. The ratio of 90 days PDL to total loans was 3.0% for 2Q20, compared to 3.1% for 1Q20 and 3.2% in 2Q19. Finally, the ratio of CDE Loans to total loans was 6.8% in 2Q20, 6.9% in 1Q20, and 7.1% in 2Q19.

Commercial loans 30 days PDL ratio was 4.1% for 2Q20 and 1Q20, and 4.2% for 2Q19; 90 days PDL ratio was 3.6%, 3.5% and 3.6%, respectively. Consumer loans 30 days PDL ratio was 3.8% for 2Q20, 4.1% for 1Q20 and 4.9% for 2Q19; 90 days PDL ratio was 2.0%, 2.6% and 2.7%, respectively. Mortgages' 30 days PDL ratio was 4.4% for 2Q20 and 1Q20, and 4.6% for 2Q19; 90 days PDL ratio was 2.7%, 3.0% and 2.6%, respectively.

Total gross loans

2Q19

1Q20

2Q20

2Q20 vs.

2Q20 vs.

1Q20

2Q19

''A'' normal risk

153,775.8

181,576.2

188,606.9

3.9%

22.7%

''B'' acceptable risk

4,749.9

5,305.3

6,491.7

22.4%

36.7%

''C'' appreciable risk

5,394.5

6,253.8

6,562.8

4.9%

21.7%

''D'' significant risk

3,762.6

3,886.3

3,875.4

-0.3%

3.0%

''E'' unrecoverable

2,970.4

3,646.3

3,756.1

3.0%

26.5%

Gross loans

170,653.2

200,668.0

209,292.9

4.3%

22.6%

Interbank and overnight funds

4,123.6

3,282.2

3,585.4

9.2%

-13.1%

Total gross loans

174,776.8

203,950.2

212,878.3

4.4%

21.8%

CDE loans / Total loans (*)

7.1%

6.9%

6.8%

Past due loans

2Q19

1Q20

2Q20

2Q20 vs.

2Q20 vs.

1Q20

2Q19

Performing

90,507.7

107,237.1

113,778.3

6.1%

25.7%

Between 31 and 90 days past due

552.6

734.4

574.4

-21.8%

3.9%

+90 days past due

3,415.4

3,859.2

4,264.8

10.5%

24.9%

Commercial loans

94,475.8

111,830.7

118,617.5

6.1%

25.6%

Performing

53,904.5

62,523.2

62,647.4

0.2%

16.2%

Between 31 and 90 days past due

1,273.7

987.1

1,198.3

21.4%

-5.9%

+90 days past due

1,527.1

1,695.3

1,276.6

-24.7%

-16.4%

Consumer loans

56,705.3

65,205.6

65,122.3

-0.1%

14.8%

Performing

18,183.2

22,212.5

24,050.9

8.3%

32.3%

Between 31 and 90 days past due

380.5

323.3

435.0

34.6%

14.3%

+90 days past due

497.1

692.6

682.8

-1.4%

37.4%

Mortgages loans

19,060.8

23,228.4

25,168.6

8.4%

32.0%

Performing

341.7

342.3

333.2

-2.7%

-2.5%

Between 31 and 90 days past due

18.6

3.1

4.6

46.7%

-75.2%

+90 days past due

51.1

58.0

46.7

-19.5%

-8.6%

Microcredit loans

411.3

403.4

384.4

-4.7%

-6.5%

Gross loans

170,653.2

200,668.0

209,292.9

4.3%

22.6%

Interbank & overnight funds

4,123.6

3,282.2

3,585.4

9.2%

-13.1%

Total gross loans

174,776.8

203,950.2

212,878.3

4.4%

21.8%

30 Days PDL / Total loans (*)

4.5%

4.2%

4.1%

90 Days PDL / Total loans (*)

3.2%

3.1%

3.0%

(*) Total loans excluding interbank and overnight funds. 30 days past due and 90 days past due are calculated on a capital plus interest accounts receivable basis.

8

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

Grupo Aval's coverage over its 90 days PDL was 1.5x for 2Q20, 1.4x for 1Q20 and 1.5x for 2Q19. Allowance to CDE Loans was 0.7x for 2Q20, 0.6x for 1Q20 and 0.7x for 2Q19, and allowance to 30 days PDL was 1.1x for 2Q20, 1Q20 and 2Q19. Impairment loss, net of recoveries of charged off assets to average total loans was 3.1% in 2Q20, and 2.2% in 1Q20 and 2Q19. Charge-offs to average total loans was 1.8% in 2Q20, 1.9% in 1Q20, and 2.3% in 2Q19.

Total gross loans

2Q19

1Q20

2Q20

Allowance for impairment / CDE loans

0.7

0.6

0.7

Allowance for impairment / 30 Days PDL

1.1

1.1

1.1

Allowance for impairment / 90 Days PDL

1.5

1.4

1.5

Allowance for impairment / Total loans (*)

4.9%

4.4%

4.6%

Impairment loss / CDE loans

0.3

0.3

0.5

Impairment loss / 30 Days PDL

0.5

0.5

0.8

Impairment loss / 90 Days PDL

0.8

0.7

1.0

Impairment loss / Average total loans (*)

2.5%

2.3%

3.2%

Impairment loss, net of recoveries of charged-off assets / Average total loans (*)

2.2%

2.2%

3.1%

Charge-offs / Average total loans (*)

2.3%

1.9%

1.8%

  1. Total loans excluding interbank and overnight funds. 30 days past due and 90 days past due are calculated on a capital plus interest accounts receivable basis.
    1.2 Investment securities and trading assets

Total investment securities and trading assets increased 39.0% to Ps 44,506.7 billion between June 30th, 2019 and June 30th, 2020 and 10.0% versus March 31st, 2020. Ps 37,518.5 billion of our total portfolio is invested in debt securities, which increased by 38.7% between June 30th, 2019 and June 30th, 2020 and by 15.3% since March 31st, 2020. Ps 5,619.6 billion of our total investment securities is invested in equity securities, which increased by 26.8% between June 30th, 2019 and June 30th, 2020 and by 11.5% versus March 31st, 2020.

Multi Financial Group contributed with Ps. 4.2 trillion of investment and trading assets (USD 1.1 billion).

Investment and trading assets

2Q19

1Q20

2Q20

2Q20 vs.

2Q20 vs.

1Q20

2Q19

Debt securities

4,011.4

4,883.0

5,600.7

14.7%

39.6%

Equity securities

3,157.1

3,708.1

4,234.8

14.2%

34.1%

Derivative assets

533.5

2,887.8

1,368.5

-52.6%

156.5%

Trading assets

7,702.0

11,478.9

11,204.1

-2.4%

45.5%

Investments in debt securities at FVTPL (non compliant with

SPPI test)

25.1

9.3

8.8

-4.8%

-64.8%

Debt securities at FVOCI

20,030.6

24,426.3

27,001.1

10.5%

34.8%

Equity securities at FVOCI

1,276.0

1,330.7

1,384.8

4.1%

8.5%

Investments in securities at FVOCI

21,306.6

25,757.0

28,386.0

10.2%

33.2%

Investments in debt securities at AC

2,984.5

3,233.7

4,907.8

51.8%

64.4%

Investment and trading assets

32,018.2

40,478.8

44,506.7

10.0%

39.0%

9

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

The average yield on our debt and equity investment securities (trading assets, investments in debt securities at FVTPL, investments in securities at FVOCI and investments in debt securities at AC) was 6.6% for 2Q20, 1.4% for 1Q20 and 5.7% in 2Q19.

1.3 Cash and Cash Equivalents

As of June 30th, 2020 cash and cash equivalents had a balance of Ps 40,109.2 billion showing an increase of 34.5% versus June 30th, 2019 and decreasing 0.1% versus March 31st, 2020 (26.3% and 3.0% excluding FX).

The ratio of cash and cash equivalents to customer deposits was 18.9% at June 30th, 2020, 19.8% at March 31st, 2020, and 18.0% at June 30th, 2019.

1.4 Goodwill and Other Intangibles

Goodwill and other intangibles as of June 30th, 2020 reached Ps 17,856.9 billion, increasing by 21.1% versus June 30th, 2019 and decreasing 0.3% versus March 31st, 2020.

Goodwill as of June 30th, 2020 was Ps 8,236.5 billion, increasing by 13.6% versus June 30th, 2019 and decreasing 3.9% versus March 31st, 2020, explained by fluctuations in the exchange rate.

Other intangibles, which include "concession arrangement rights" and other intangibles, mainly reflect the value of road concessions recorded for the most part at Corficolombiana. Other intangibles as of June 30th, 2020 reached Ps 9,620.4 billion and grew by 28.3% versus June 30th, 2019 and 3.0% versus March 31st, 2020.

2. Liabilities

As of June 30th, 2020 funding represented 94.6% of total liabilities and other liabilities represented 5.4%.

2.1 Funding

Total Funding (Total financial liabilities at amortized cost) which includes (i) Customer deposits, (ii) Interbank borrowings and overnight funds, (iii) Borrowings from banks and others, (iv) Bonds issued, and (v) Borrowing from development entities had a balance of Ps 282,723.1 billion as of June 30th, 2020 showing an increase of 28.5% versus June 30th, 2019 and of 5.1% versus March 31st, 2020 (22.5% and 7.6% increase excluding FX). Total customer deposits represented 75.1% of total funding as of the end of 2Q20, 75.6% for 1Q20 and 75.4% for 2Q19.

Multi Financial Group contributed with Ps. 16.3 trillion in total funding (USD 4.3 billion). Average cost of funds was 3.3% for 2Q20, 3.5% for 1Q20 and 3.8% for 2Q19.

10

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

2.1.1 Customer deposits

Customer deposits

2Q19

1Q20

2Q20

2Q20 vs.

2Q20 vs.

1Q20

2Q19

Checking accounts

14,811.2

18,843.7

25,290.1

34.2%

70.7%

Other deposits

526.6

388.6

499.8

28.6%

-5.1%

Non-interest bearing

15,337.8

19,232.3

25,789.9

34.1%

68.1%

Checking accounts

23,479.6

34,215.8

26,486.3

-22.6%

12.8%

Time deposits

71,687.7

81,071.4

86,638.2

6.9%

20.9%

Savings deposits

55,495.7

68,701.9

73,301.6

6.7%

32.1%

Interest bearing

150,663.0

183,989.2

186,426.2

1.3%

23.7%

Customer deposits

166,000.8

203,221.5

212,216.0

4.4%

27.8%

Of our total customer deposits as of June 30th, 2020 checking accounts represented 24.4%, time deposits 40.8%, savings accounts 34.5%, and other deposits 0.2%.

Multi Financial Group contributed with Ps. 11.0 trillion in deposits (USD 2.9 billion).

The following table shows the customer deposits composition by bank. During the last twelve months, Banco de Bogotá showed the highest growth rate in customer deposits within our banking operation in Colombia.

Deposits / Bank ($)

2Q19

1Q20

2Q20

2Q20 vs.

2Q20 vs.

1Q20

2Q19

Banco de Bogotá

107,408.4

143,581.6

148,550.2

3.5%

38.3%

Domestic

56,458.0

72,181.8

67,964.0

-5.8%

20.4%

Central America

50,950.4

71,399.8

80,586.2

12.9%

58.2%

Banco de Occidente

26,706.2

31,476.6

30,764.9

-2.3%

15.2%

Banco Popular

19,096.1

18,516.9

21,579.6

16.5%

13.0%

Banco AV Villas

11,307.6

12,694.2

12,821.0

1.0%

13.4%

Corficolombiana

4,006.2

4,671.5

4,765.1

2.0%

18.9%

Eliminations

(2,523.5)

(7,719.5)

(6,264.7)

-18.8%

148.2%

Total Grupo Aval

166,000.8

203,221.5

212,216.0

4.4%

27.8%

Deposits / Bank (%)

2Q19

1Q20

2Q20

Banco de Bogotá

64.7%

70.7%

70.0%

Domestic

34.0%

35.5%

32.0%

Central America

30.7%

35.1%

38.0%

Banco de Occidente

16.1%

15.5%

14.5%

Banco Popular

11.5%

9.1%

10.2%

Banco AV Villas

6.8%

6.2%

6.0%

Corficolombiana

2.4%

2.3%

2.2%

Eliminations

-1.5%

-3.8%

-3.0%

Total Grupo Aval

100.0%

100.0%

100.0%

11

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

2.1.2 Borrowings from Banks and Other (includes borrowings from development entities)

As of June 30th, 2020 borrowings from banks and other totaled Ps 30,673.5 billion, showing an increase of 30.1% versus June 30th, 2019 and of 4.6% versus March 31st, 2020. Excluding FX, borrowings from banks and other increased 21.8% versus June 30th, 2019 and 7.7% versus March 31st, 2020.

2.1.3 Bonds issued

Total bonds issued as of June 30th, 2020 totaled Ps 28,829.1 billion increased 43.4% versus June 30th, 2019 and 0.5% versus March 31st, 2020. Excluding FX, bonds increased 42.1% versus June 30th, 2019 and 0.8% versus March 31st, 2020.

3. Non-controlling Interest

Non-controlling Interest in Grupo Aval reflects: (i) the minority stakes that third party shareholders hold in each of its direct consolidated subsidiaries (Banco de Bogotá, Banco de Occidente, Banco Popular, Banco AV Villas and Corficolombiana), and (ii) the minority stakes that third party shareholders hold in the consolidated subsidiaries at the bank level (mainly Porvenir). As of June 30th, 2020 non-controlling interest was Ps 14,221.0 billion which increased by 15.7% versus June 30th, 2019 and 4.9% versus March 31st, 2020. Total non-controlling interest represents 41.6% of total equity as of 2Q20, compared to 41.0% in 1Q20 and 40.2% in 2Q19. Total non-controlling interest derives from the sum of the combined minority interests of our banks and of Grupo Aval, applying eliminations associated with the consolidation process of Grupo Aval.

Percentage consolidated by Aval

2Q19

1Q20

2Q20

2Q20 vs. 1Q20

2Q20 vs. 2Q19

Banco de Bogotá

68.7%

68.7%

68.7%

-

-

Banco de Occidente

72.3%

72.3%

72.3%

-

-

Banco Popular

93.7%

93.7%

93.7%

-

-

Banco AV Villas

79.9%

79.9%

79.9%

-

-

BAC Credomatic(1)

68.7%

68.7%

68.7%

-

-

Porvenir(2)

75.7%

75.7%

75.7%

-

0

Corficolombiana

38.2%

38.6%

38.6%

-

40

  1. BAC Credomatic is fully owned by Banco de Bogotá; (2) Grupo Aval indirectly owns a 100% of Porvenir as follows: 20.0% in Grupo Aval, 46.9% in Banco de Bogotá and 33.1% in Banco de Occidente. Porvenir's results consolidate into Banco de Bogotá.

4. Attributable Shareholders' Equity

Attributable shareholders' equity as of June 30th, 2020 was Ps 19,939.8 billion, showing an increase of 8.9% versus June 30th, 2019 and a increase of 2.4% versus March 31st, 2020.

12

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

Income Statement Analysis

Our net income attributable to the owners of the parent company for 2Q20 of Ps 323.4 billion showed a 60.2% decrease versus 2Q19 and a 53.8% decrease versus 1Q20.

Consolidated Statement of Income

2Q19

1Q20

2Q20

2Q20 vs.

2Q20 vs.

1Q20

2Q19

Interest income

4,885.8

5,097.5

5,199.9

2.0%

6.4%

Interest expense

2,054.4

2,172.0

2,246.4

3.4%

9.3%

Net interest income

2,831.3

2,925.5

2,953.6

1.0%

4.3%

Loans and other accounts receivable

1,040.9

1,101.4

1,642.1

49.1%

57.7%

Other financial assets

(33.2)

14.8

43.6

194.1%

N.A

Recovery of charged-off financial assets

(96.6)

(79.7)

(56.0)

-29.7%

-42.0%

Net impairment loss on financial assets

911.1

1,036.5

1,629.6

57.2%

78.9%

Net income from commissions and fees

1,347.2

1,345.8

1,094.5

-18.7%

-18.8%

Gross profit from sales of goods and services

599.7

833.7

239.4

-71.3%

-60.1%

Net trading income

208.6

1,101.2

(93.6)

-108.5%

-144.9%

Net income from other financial instruments mandatory at FVTPL

53.4

73.3

59.7

-18.5%

11.7%

Total other income

266.1

(804.3)

853.2

N.A

N.A.

Total other expenses

2,409.2

2,576.4

2,621.6

1.8%

8.8%

Net income before income tax expense

1,986.1

1,862.3

855.6

-54.1%

-56.9%

Income tax expense

586.4

516.4

214.6

-58.4%

-63.4%

Net income for the period

1,399.7

1,345.8

641.0

-52.4%

-54.2%

Non-controlling interest

586.5

645.6

317.6

-50.8%

-45.8%

Net income attributable to owners of the parent

813.2

700.2

323.4

-53.8%

-60.2%

1. Net Interest Income

Net interest income

2Q19

1Q20

2Q20

2Q20 vs.

2Q20 vs.

1Q20

2Q19

Interest income

Commercial

1,842.9

1,889.1

1,963.6

3.9%

6.5%

Interbank and overnight funds

108.5

81.9

43.7

-46.6%

-59.7%

Consumer

2,224.8

2,322.9

2,374.0

2.2%

6.7%

Mortgages and housing leases

403.9

455.2

466.1

2.4%

15.4%

Microcredit

25.5

25.7

22.5

-12.5%

-11.6%

Loan portfolio

4,605.7

4,774.8

4,870.0

2.0%

5.7%

Interests on investments in debt securities

280.0

322.6

330.0

2.3%

17.8%

Total interest income

4,885.8

5,097.5

5,199.9

2.0%

6.4%

Interest expense

Checking accounts

103.6

93.7

81.7

-12.8%

-21.2%

Time deposits

888.5

948.4

968.9

2.2%

9.0%

Savings deposits

374.2

427.1

422.4

-1.1%

12.9%

Total interest expenses on deposits

1,366.4

1,469.2

1,473.0

0.3%

7.8%

Interbank borrowings and overnight funds

84.3

84.5

97.7

15.7%

16.0%

Borrowings from banks and others

277.3

220.4

242.3

9.9%

-12.7%

Bonds issued

294.4

359.4

397.8

10.7%

35.1%

Borrowings from development entities

32.0

38.5

35.7

-7.3%

11.5%

Total interest expenses on financial obligations

688.0

702.7

773.4

10.1%

12.4%

Total interest expense

2,054.4

2,172.0

2,246.4

3.4%

9.3%

Net interest income

2,831.3

2,925.5

2,953.6

1.0%

4.3%

13

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

Our net interest income increased by 4.3% to Ps 2,953.6 billion for 2Q20 versus 2Q19 and increased 1.0% versus 1Q20. The increase versus 2Q19 was derived from a 6.4% increase in total interest income that was partially offset by a 9.3% increase in total interest expense.

Our Net Interest Margin(1) was 5.3% for 2Q20, 4.8% in 1Q20 and 5.9% in 2Q19. Net Interest Margin on Loans was 5.8% for 2Q20, 6.1% in 1Q20 and 6.6% in 2Q19. On the other hand, our Net Investments Margin was 2.9% in 2Q20 versus -1.7% in 1Q20 and 2.3% in 2Q19.

In our Colombian operations, our Net Interest Margin was 4.9% for 2Q20, 4.0% for 1Q20, and 5.4% for 2Q19. Net Interest Margin on Loans was 5.3% for 2Q20, 5.6% in 1Q20 and 6.2% in 2Q19. On the other hand, our Net Investments Margin was 3.4% in 2Q20 versus -3.3% in 1Q20 and 2.0% in 2Q19.

In our Central American operations, our Net Interest Margin was 6.0% for 2Q20, 6.4% in 1Q20 and 6.9% in 2Q19. Net Interest Margin on Loans was 6.8% for 2Q20, 7.0% in 1Q20 and 7.5% in 2Q19. On the other hand, our Net Investments Margin was 1.5% for 2Q20, 2.7% in 1Q20 versus 3.0% in 2Q19.

2. Impairment loss on financial assets, net

Our impairment loss on financial assets, net increased by 78.9% to Ps 1,629.6 billion for 2Q20 versus 2Q19 and 57.2% versus 1Q20.

Net impairment loss on financial assets

2Q19

1Q20

2Q20

2Q20 vs. 2Q20 vs.

1Q20

2Q19

Loans and other accounts receivable

1,040.9

1,101.4

1,642.1

49.1%

57.7%

Other financial assets

(33.2)

14.8

43.6

194.1%

N.A

Recovery of charged-off financial assets

(96.6)

(79.7)

(56.0)

-29.7%

-42.0%

Net impairment loss on financial assets

911.1

1,036.5

1,629.6

57.2%

78.9%

Our annualized gross cost of risk was 3.2% for 2Q20, 2.3% for 1Q20 and 2.5% for 2Q19. Net of recoveries of charged-off assets our ratio was 3.1% for 2Q20, 2.2% for 1Q20 and 2.2% for 2Q19.

  1. Grupo Aval's NIM without income from trading securities and investment in debt securities designated at fair value

through profit and loss (non compliant with SPPI test) was 5.0% for 2Q20, 5.3% for 1Q20 and 5.7% for 2Q19.

14

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

3. Non-interest income

Total non-interest income

2Q19

1Q20

2Q20

2Q20 vs.

2Q20 vs.

1Q20

2Q19

Income from commissions and fees

Banking fees (1)

1,075.1

1,109.0

893.5

-19.4%

-16.9%

Trust activities

84.4

81.4

78.9

-3.0%

-6.5%

Pension and severance fund management

301.0

307.7

260.9

-15.2%

-13.3%

Bonded warehouse services

40.1

36.7

35.0

-4.8%

-12.8%

Total income from commissions and fees

1,500.6

1,534.8

1,268.3

-17.4%

-15.5%

Expenses from commissions and fees

153.4

189.0

173.7

-8.1%

13.3%

Net income from commissions and fees

1,347.2

1,345.8

1,094.5

-18.7%

-18.8%

Income from sales of goods and services

2,077.9

2,463.6

1,528.3

-38.0%

-26.4%

Costs and expenses from sales of goods and services

1,478.1

1,629.9

1,288.9

-20.9%

-12.8%

Gross profit from sales of goods and services

599.7

833.7

239.378

-71.3%

-60.1%

Net trading income

208.6

1,101.2

(93.6)

-108.5%

-144.9%

Net income from other financial instruments mandatory at FVTPL

53.4

73.3

59.7

-18.5%

11.7%

Other income

Foreign exchange gains (losses), net

16.6

(1,147.8)

557.7

-148.6%

N.A.

Net gain on sale of investments and OCI realization

65.1

94.3

106.2

12.7%

63.1%

Gain on the sale of non-current assets held for sale

6.6

28.6

6.6

-76.9%

0.5%

Income from non-consolidated investments (2)

65.9

148.2

43.4

-70.7%

-34.2%

Net gains on asset valuations

(7.3)

3.3

(1.8)

-154.8%

-75.0%

Other income from operations

119.2

69.1

141.1

104.1%

18.4%

Total other income

266.1

(804.3)

853.2

N.A

N.A.

Total non-interest income

2,475.0

2,549.6

2,153.3

-15.5%

-13.0%

(1)Includes commissions on banking services, office network services, credit and debit card fees, fees on drafts, checks and checkbooks and other fees

  1. Includes share of profit of equity accounted investees, net of tax, and dividend income.

3.1 Net income from commissions and fees

Net income from commissions and fees decreased by 18.8% to Ps 1,094.5 billion for 2Q20 versus 2Q19 and 18.7% in the quarter. Income from commissions and fees decreased by 15.5% to Ps 1,268.3 billion in 2Q20 versus 2Q19 and 17.4% in the quarter. Excluding FX, net income from commissions decreased 24.6% and 21.8%, respectively. In Colombia, net income from commissions and fees decreased by 20.8% over the last year and 17.8% over the quarter. In Central America, net income from commissions and fees decreased by 16.1% over the last year and 19.7% over the quarter; excluding FX, net income decreased by 29.1% over the last year and 26.5% during the quarter.

3.2 Gross profit from sales of goods and services

Gross profit from sales of goods and services (non-financial sector) decreased by 60.4% to Ps 239.4 billion for 2Q20 versus 2Q19 and 71.3% during the quarter. The decrease versus 1Q20 and 2Q19 is mainly explained by the lower income from investments in toll road concessions and in Promigas.

15

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

3.3 Net trading income

Net trading income

2Q19

1Q20

2Q20

2Q20 vs.

2Q20 vs.

1Q20

2Q19

Trading investment income

152.3

(204.2)

316.8

N.A

108.0%

Net income (loss) on financial derivatives

31.4

1,160.5

(364.0)

-131.4%

N.A

Other trading income on derivatives

24.9

144.8

(46.4)

-132.0%

N.A

Net trading income

208.6

1,101.2

(93.6)

-108.5%

-144.9%

Net trading income for Grupo Aval should be analyzed in conjunction with the foreign exchange gains (losses).

3.4 Other income

Total other income for 2Q20 totaled Ps 853.2 billion mainly driven by gains from foreign exchange.

4. Other expenses

Total other expenses for 2Q20 totaled Ps 2,621.6 billion increasing by 8.8% versus 2Q19 and 1.8% versus 1Q20 (1.4% and -1.9% excluding FX). Our efficiency ratio measured as total other expenses to total income was 51.3% in 2Q20, 47.1% in 1Q20 and 45.4% in 2Q19. The ratio of annualized total other expenses as a percentage of average total assets was 3.2% in 2Q20, 3.4% in 1Q20 and 3.7% in 2Q19.

In Colombia, our efficiency ratio measured as total other expenses to total income, was 47.4% in 2Q20, 42.7% in 1Q20 and 40.3% in 2Q19. The ratio of annualized total other expenses as a percentage of average total assets was 2.8% in 2Q20, 2.9% in 1Q20 and 3.2% in 2Q19.

In Central America, our efficiency ratio measured as total other expenses to total income, was 57.8% in 2Q20, 54.7% in 1Q20 and 56.5% in 2Q19. The ratio of annualized total other expenses as a percentage of average total assets was 4.0% in 2Q20, 4.7% in 1Q20 and 4.9% in 2Q19.

5. Non-controlling Interest

Non-controlling interest in Grupo Aval reflects: (i) the minority stakes that third party shareholders hold in each of its direct consolidated subsidiaries (Banco de Bogotá, Banco de Occidente, Banco Popular, Banco AV Villas and Corficolombiana), and (ii) the minority stakes that third party shareholders hold in the consolidated subsidiaries at the bank level (mainly Porvenir). For 2Q20, non- controlling interest in the income statement was Ps 317.6 billion, showing an 45.8% decrease versus 2Q19 and 50.8% versus 1Q20. The ratio of non-controlling interest to income before non-controlling interest was 49.6% in 2Q20, 48.0% in 1Q20 and 41.9% in 2Q19.

16

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

Information related to Grupo Aval's consolidated financial statements by geography

Grupo Aval Acciones y Valores S.A. - Colombian Operation

Financial Statements Under Full IFRS

Information in Ps. Billions

2Q19

1Q20

2Q20

2Q19

2Q20

2Q19

1Q20

2Q20

2Q20 vs.

2Q20 vs.

1Q20

2Q19

Gross loans and receivables

119,077.9

131,414.5

132,772.4

1.0%

11.5%

Total assets

186,697.0

215,714.4

213,888.5

-0.8%

14.6%

Customer deposits

115,050.4

131,821.7

131,629.9

-0.1%

14.4%

Total liabilities

169,577.4

200,921.0

197,380.3

-1.8%

16.4%

Net income for the period

1,090.7

901.9

401.7

-55.5%

-63.2%

Net income attributable to owners of the parent

600.8

395.2

158.9

-59.8%

-73.6%

YTD 2019

YTD 2020

2020 vs. 2019

Net income for the period

2,150.6

1,303.6

-39.4%

A

Net income attributable to owners of the parent

1,159.7

554.0

-52.2%

Leasing Bogotá Panamá S.A.(1)

Financial Statements Under IFRS

Information in Ps. Billions

3Q18

4Q18

2Q18

3Q18

2Q18

2Q19

1Q20

2Q20

2Q20 vs.

2Q20 vs.

1Q20

2Q19

Gross loans and receivables

51,575.3

69,253.5

76,520.5

10.5%

48.4%

Total assets

77,979.1

104,713.3

119,075.0

13.7%

52.7%

Customer deposits

50,950.4

71,399.8

80,586.2

12.9%

58.2%

Total liabilities

64,495.7

86,476.4

101,422.4

17.3%

57.3%

Net income for the period

309.0

443.9

239.3

-46.1%

-22.5%

Net income attributable to owners of the parent

212.4

305.1

164.5

-46.1%

-22.6%

YTD 2019

YTD 2020

2020 vs. 2019

Net income for the period

605.7

683.2

12.8%

B

Net income attributable to owners of the parent

416.3

469.5

12.8%

A+B

Net income attributable to owners of the parent

1,576.1

1,023.6

-35.1%

(1) Leasing Bogotá Panamá is the holding company that consolidates our Central American operations.

17

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

Information related to Grupo Aval Acciones y Valores S.A. (Holding Company) and Grupo Aval Limited

The holding company recorded a total gross indebtedness of Ps 1,661.4 billion (Ps 529.9 billion of bank debt and Ps 1,131.4 billion of bonds denominated in Colombian pesos) as of June 30th 2020. It also guarantees irrevocably and unconditionally Grupo Aval Limited's (144A / Reg S) 2022 (USD 1.0 billion) bonds and Grupo Aval Limited's (144A / Reg S) 2030 (USD 1.0 billion) bonds under its respective indentures. As of June 30th, 2020 the total amount outstanding (including interests payable) of such bonds was USD 2.0 billion, or Ps 7,590.7 billion when translated into pesos.

The debt at Grupo Aval Limited is serviced with interest income on loans to subsidiaries and cash & cash equivalents. Grupo Aval Limited has not required, to this date, cash from Grupo Aval Acciones y Valores S.A. to fulfill its obligations. The main sources of cash to pay the debt and debt service at Grupo Aval Acciones y Valores S.A. have been the dividend income from its subsidiaries and the returns on its cash & cash equivalents.

When combined, Grupo Aval Acciones y Valores S.A. and Grupo Aval Ltd. had Ps 3,994.9 billion of total liquid assets, a total gross indebtedness of Ps 9,252.1 billion and a net indebtedness (including callable senior loans to subsidiaries) of Ps 5,257.2 billion as of June 30th, 2020. In addition to liquid assets, Grupo Aval Ltd. has Ps 1,165.3 billion in other loans to subsidiaries and investments in AT1 instruments of Ps 1,953.3 billion.

Total liquid assets as of June 30, 2020

Cash and cash equivalents

2,980.1

Fixed income investments

304.8

Callable Senior loans to subsidiaries

709.9

Total liquid assets

3,994.9

Maturity schedule of our combined gross debt

(Ps Billions)

3,905.8 3,756.3

139.1

236.8

1.4

226.0

0.4

93.0

207.0

300.0

300.0

2020

2021

2022

2023

2024

2025

2026

2030

2036

2039

2042

As of June 30th, 2020 our combined double leverage (calculated as investments in subsidiaries at book value, subordinated loans to subsidiaries and goodwill as a percentage of shareholders' equity) was 1.20x. Finally, we present an evolution of our key ratios on a combined basis:

Debt service coverage and leverage ratios

2Q19

1Q20

2Q20

2Q20 vs.

2Q20 vs.

1Q20

2Q19

Double leverage (1)

1.14x

1.15x

1.20x

0.05

0.06

Net debt / Core earnings (2)(3)

2.7x

3.2x

3.3x

0.1

0.6

Net debt / Cash dividends (2)(3)

3.0x

3.7x

4.3x

0.6

1.3

Core Earnings / Interest Expense (2)

5.5x

4.0x

3.9x

-0.2

-1.6

  1. Double leverage is calculated as investments in subsidiaries at book value (excluding revaluations), subordinated loans to subsidiaries and goodwill as a percentage of shareholders' equity; (2) Core earnings are defined as annualized recurring cash flow from dividends, investments and net operating income; (3) Net debt is calculated as total gross debt minus cash and cash equivalents and fixed income investments

18

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

ABOUT GRUPO AVAL

Grupo Aval is Colombia's largest banking group, and through our BAC Credomatic and Multi Financial Group operations it is also the largest and the most profitable banking group in Central America. Grupo Aval currently operates through four commercial banks in Colombia (Banco de Bogotá, Banco de Occidente, Banco Popular and Banco AV Villas). It manages pension and severance funds through the largest pension and severance fund manager in Colombia (Porvenir) and owns the largest merchant bank in Colombia (Corficolombiana), each of which Aval controls and consolidates into its results.

Investor Relations Contact

Alejo Sánchez García

Strategic Planning and Investor Relations Manager

Tel: +571 241 9700 x23422

E-mail:asanchez@grupoaval.com

19

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

Grupo Aval Acciones y Valores S.A.

Consolidated Financial Statements Under IFRS

Financial Statements Under IFRS

Information in Ps. Billions

2Q19

1Q20

2Q20

2Q19

2Q20

Consolidated Statement of Financial Position

2Q19

1Q20

2Q20

2Q20 vs. 1Q20

2Q20 vs. 2Q19

Cash and cash equivalents

29,824.7

40,136.8

40,109.2

-0.1%

34.5%

Investment and trading assets

Debt securities

4,011.4

4,883.0

5,600.7

14.7%

39.6%

Equity securities

3,157.1

3,708.1

4,234.8

14.2%

34.1%

Derivative assets

533.5

2,887.8

1,368.5

-52.6%

156.5%

Trading assets

7,702.0

11,478.9

11,204.1

-2.4%

45.5%

Investments in debt securities at FVTPL (non compliant with SPPI test)

25.1

9.3

8.8

-4.8%

-64.8%

Investments in securities at FVOCI

21,306.6

25,757.0

28,386.0

10.2%

33.2%

Investments in debt securities at AC

2,984.5

3,233.7

4,907.8

51.8%

64.4%

Investment securities

24,316.2

28,999.9

33,302.6

14.8%

37.0%

Hedging derivatives assets

44.4

206.0

129.0

-37.4%

190.8%

Gross loans

Commercial loans

98,599.4

115,112.9

122,202.9

6.2%

23.9%

Commercial loans

94,475.8

111,830.7

118,617.5

6.1%

25.6%

Interbank & overnight funds

4,123.6

3,282.2

3,585.4

9.2%

-13.1%

Consumer loans

56,705.3

65,205.6

65,122.3

-0.1%

14.8%

Mortgages loans

19,060.8

23,228.4

25,168.6

8.4%

32.0%

Microcredit loans

411.3

403.4

384.4

-4.7%

-6.5%

Total gross loans

174,776.8

203,950.2

212,878.3

4.4%

21.8%

Loss allowance

(8,375.5)

(8,883.9)

(9,575.2)

7.8%

14.3%

Total loans, net

166,401.3

195,066.3

203,303.0

4.2%

22.2%

Other accounts receivable, net

10,343.5

13,340.9

13,548.9

1.6%

31.0%

Non-current assets held for sale

104.9

284.1

441.1

55.3%

N.A.

Investments in associates and joint ventures

937.3

996.5

999.5

0.3%

6.6%

Own-use property, plant and equipment for own-use and given in operating

5,711.0

5,886.3

6,070.0

3.1%

6.3%

lease, net

Right-of-use assets

2,132.1

2,379.8

2,328.0

-2.2%

9.2%

Investment properties

924.6

921.0

927.8

0.7%

0.3%

Biological assets

95.7

108.4

112.0

3.3%

17.0%

Tangible assets

8,863.4

9,295.5

9,437.8

1.5%

6.5%

Goodwill

7,249.3

8,571.5

8,236.5

-3.9%

13.6%

Concession arrangement rights

6,429.4

8,068.4

8,154.6

1.1%

26.8%

Other intangible assets

1,066.6

1,274.1

1,465.8

15.0%

37.4%

Intangible assets

14,745.4

17,914.0

17,856.9

-0.3%

21.1%

Current

797.0

923.9

1,142.2

23.6%

43.3%

Deferred

235.8

1,286.1

949.8

-26.1%

N.A.

Income tax assets

1,032.7

2,210.1

2,092.0

-5.3%

102.6%

Other assets

360.2

498.7

539.5

8.2%

49.8%

Total assets

264,676.1

320,427.8

332,963.5

3.9%

25.8%

Trading liabilities

568.3

3,016.1

1,196.5

-60.3%

110.6%

Hedging derivatives liabilities

76.7

770.9

310.6

-59.7%

N.A.

Customer deposits

166,000.8

203,221.5

212,216.0

4.4%

27.8%

Checking accounts

38,290.8

53,059.5

51,776.4

-2.4%

35.2%

Time deposits

71,687.7

81,071.4

86,638.2

6.9%

20.9%

Savings deposits

55,495.7

68,701.9

73,301.6

6.7%

32.1%

Other deposits

526.6

388.6

499.8

28.6%

-5.1%

Financial obligations

54,091.2

65,763.4

70,507.1

7.2%

30.3%

Interbank borrowings and overnight funds

10,416.7

7,768.2

11,004.5

41.7%

5.6%

Borrowings from banks and others

20,278.7

25,511.2

26,570.5

4.2%

31.0%

Bonds issued

20,105.5

28,684.4

28,829.1

0.5%

43.4%

Borrowings from development entities

3,290.4

3,799.6

4,103.0

8.0%

24.7%

Total financial liabilities at amortized cost

220,092.1

268,984.9

282,723.1

5.1%

28.5%

Legal related

112.8

196.6

180.4

-8.3%

60.0%

Other provisions

607.5

700.4

729.4

4.1%

20.1%

Provisions

720.3

897.1

909.8

1.4%

26.3%

Current

314.8

466.5

267.3

-42.7%

-15.1%

Deferred

2,608.6

2,645.2

2,788.6

5.4%

6.9%

Income tax liabilities

2,923.3

3,111.7

3,055.9

-1.8%

4.5%

Employee benefits

1,151.4

1,295.7

1,250.1

-3.5%

8.6%

Other liabilities

8,541.0

9,321.2

9,356.6

0.4%

9.5%

Total liabilities

234,073.0

287,397.4

298,802.7

4.0%

27.7%

Equity attributable to owners of the parent

18,310.6

19,472.2

19,939.8

2.4%

8.9%

Non-controlling interest

12,292.5

13,558.1

14,221.0

4.9%

15.7%

Total equity

30,603.1

33,030.3

34,160.8

3.4%

11.6%

Total liabilities and equity

264,676.1

320,427.8

332,963.5

3.9%

25.8%

20

Report of 2Q2020 consolidated results

Information reported in Ps billions and under IFRS

Grupo Aval Acciones y Valores S.A.

Consolidated Financial Statements Under Full IFRS

Financial Statements Under IFRS

Information in Ps. Billions

2Q19

2Q20

2Q20

2Q19

1Q20

2Q20

2Q19

2Q20

Consolidated Statement of income

YTD 2019

YTD 2020

2020 vs. 2019

2Q19

1Q20

2Q20

2Q20 vs. 1Q20

2Q20 vs. 2Q19

Interest income

Loan portfolio

9,004.6

9,644.8

7.1%

4,605.7

4,774.8

4,870.0

2.0%

5.7%

Interests on investments in debt securities

550.3

652.6

18.6%

280.0

322.6

330.0

2.3%

17.8%

Total interest income

9,555.0

10,297.4

7.8%

4,885.8

5,097.5

5,199.9

2.0%

6.4%

Interest expense

Checking accounts

206.9

175.4

-15.2%

103.6

93.7

81.7

-12.8%

-21.2%

Time deposits

1,727.4

1,917.3

11.0%

888.5

948.4

968.9

2.2%

9.0%

Savings deposits

736.7

849.5

15.3%

374.2

427.1

422.4

-1.1%

12.9%

Total interest expenses on deposits

2,671.1

2,942.2

10.1%

1,366.4

1,469.2

1,473.0

0.3%

7.8%

Interbank borrowings and overnight funds

161.9

182.2

12.5%

84.3

84.5

97.7

15.7%

16.0%

Borrowings from banks and others

511.9

462.6

-9.6%

277.3

220.4

242.3

9.9%

-12.7%

Bonds issued

581.9

757.1

30.1%

294.4

359.4

397.8

10.7%

35.1%

Borrowings from development entities

67.4

74.2

10.1%

32.0

38.5

35.7

-7.3%

11.5%

Total interest expenses on financial obligations

1,323.1

1,476.2

11.6%

688.0

702.7

773.4

10.1%

12.4%

Total interest expense

3,994.1

4,418.3

10.6%

2,054.4

2,172.0

2,246.4

3.4%

9.3%

Net interest income

5,560.8

5,879.1

5.7%

2,831.3

2,925.5

2,953.6

1.0%

4.3%

Impairment losses (recoveries) on financial assets

Loans and other accounts receivable

1,974.1

2,743.4

39.0%

1,040.9

1,101.4

1,642.1

49.1%

57.7%

Other financial assets

(56.1)

58.4

N.A

(33.2)

14.8

43.6

194.1%

N.A

Recovery of charged-off financial assets

(173.8)

(135.7)

-21.9%

(96.6)

(79.7)

(56.0)

-29.7%

-42.0%

Net impairment loss on financial assets

1,744.3

2,666.1

52.9%

911.1

1,036.5

1,629.6

57.2%

78.9%

Net interest income, after impairment losses

3,816.6

3,212.9

-15.8%

1,920.2

1,889.0

1,323.9

-29.9%

-31.1%

Income from commissions and fees

Banking fees (1)

2,103.1

2,002.5

-4.8%

1,075.1

1,109.0

893.5

-19.4%

-16.9%

Trust activities

165.1

160.3

-2.9%

84.4

81.4

78.9

-3.0%

-6.5%

Pension and severance fund management

556.6

568.6

2.2%

301.0

307.7

260.9

-15.2%

-13.3%

Bonded warehouse services

81.1

71.7

-11.6%

40.1

36.7

35.0

-4.8%

-12.8%

Total income from commissions and fees

2,905.8

2,803.1

-3.5%

1,500.6

1,534.8

1,268.3

-17.4%

-15.5%

Expenses from commissions and fees

299.6

362.7

21.1%

153.4

189.0

173.7

-8.1%

13.3%

Net income from commissions and fees

2,606.2

2,440.3

-6.4%

1,347.2

1,345.8

1,094.5

-18.7%

-18.8%

Income from sales of goods and services

4,001.4

3,991.9

-0.2%

2,077.9

2,463.6

1,528.3

-38.0%

-26.4%

Costs and expenses from sales of goods and services

2,827.1

2,918.8

3.2%

1,478.1

1,629.9

1,288.9

-20.9%

-12.8%

Gross profit from sales of goods and services

1,174.3

1,073.1

-8.6%

599.7

833.7

239.4

-71.3%

-60.1%

Net trading income

316.7

1,007.6

N.A.

208.6

1,101.2

(93.6)

-108.5%

-144.9%

Net income from other financial instruments mandatory at FVTPL

107.1

133.0

24.1%

53.4

73.3

59.7

-18.5%

11.7%

Other income

Foreign exchange gains (losses), net

182.7

(590.1)

N.A

16.6

(1,147.8)

557.7

-148.6%

N.A.

Net gain on sale of investments and OCI realization

71.1

200.5

182.1%

65.1

94.3

106.2

12.7%

63.1%

Gain on the sale of non-current assets held for sale

12.6

35.2

179.9%

6.6

28.6

6.6

-76.9%

0.5%

Income from non-consolidated investments (2)

189.1

191.5

1.3%

65.9

148.2

43.4

-70.7%

-34.2%

Net gains on asset valuations

(2.8)

1.5

-154.5%

(7.3)

3.3

(1.8)

-154.8%

-75.0%

Other income from operations

199.3

210.3

5.5%

119.2

69.1

141.1

104.1%

18.4%

Total other income

652.0

48.9

-92.5%

266.1

(804.3)

853.2

N.A

N.A.

Other expenses

Loss on the sale of non-current assets held for sale

2.3

2.3

0.6%

0.7

1.8

0.4

-76.2%

-37.4%

Personnel expenses

1,962.3

2,175.5

10.9%

997.1

1,087.0

1,088.5

0.1%

9.2%

General and administrative expenses

2,235.8

2,394.3

7.1%

1,149.3

1,221.6

1,172.6

-4.0%

2.0%

Depreciation and amortization

439.8

484.5

10.1%

231.9

235.2

249.3

6.0%

7.5%

Impairment loss on other assets

19.2

4.1

-78.5%

15.4

3.7

0.4

-89.4%

-97.4%

Other operating expenses

36.3

137.3

N.A.

14.8

27.0

110.3

N.A.

N.A.

Total other expenses

4,695.6

5,197.9

10.7%

2,409.2

2,576.4

2,621.6

1.8%

8.8%

Net income before income tax expense

3,977.3

2,717.9

-31.7%

1,986.1

1,862.3

855.6

-54.1%

-56.9%

Income tax expense

1,221.0

731.0

-40.1%

586.4

516.4

214.6

-58.4%

-63.4%

Net income for the period

2,756.3

1,986.8

-27.9%

1,399.7

1,345.8

641.0

-52.4%

-54.2%

Net income for the period attibutable to:

Non-controlling interest

1,180.3

963.2

-18.4%

586.5

645.6

317.6

-50.8%

-45.8%

Net income attributable to owners of the parent

1,576.1

1,023.6

-35.1%

813.2

700.2

323.4

-53.8%

-60.2%

(1)Includes commissions on banking services, office network services, credit and debit card fees, fees on drafts, checks and checkbooks and other fees

  1. Includes share of profit of equity accounted investees, net of tax, and dividend income.

21

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Grupo Aval Acciones y Valores SA published this content on 27 August 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 August 2020 07:27:04 UTC