Analyst Note
| Michael Miller |Narrow-moat-rated Banco Santander Chile posted decent third-quarter earnings, falling short of the FactSet consensus estimate of CLP 0.94 per share with reported adjusted EPS of CLP 0.93. These results equate to a return on equity of 21.1% for the quarter. With over 75% of the population fully vaccinated and lower rates of infection, things are looking up for the Chilean economy as it surpasses pre-pandemic levels. However, political uncertainty remains high with presidential and parliamentary elections happening in a few weeks, along with the constitutional rewrite that is expected to be finished by June 2022. Despite this, we do not see a material medium-term impact from the political situation on the bank’s performance and believe Santander Chile will continue to benefit from the country’s recovery from the pandemic. After incorporating the third-quarter results, we are maintaining our fair value estimate of $24 per ADR share.