UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 20-F

 

(Mark One)

REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

 

OR

 

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2023

 

OR

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

OR

 

SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

Date of event requiring this shell company report___________________

 

For the transition period from ______________ to ______________.

 

Commission file number: 001-14554

 

BANCO SANTANDER-CHILE
(d/b/a Santander and Banco Santander)
(Exact name of Registrant as specified in its charter)

 

SANTANDER-CHILE BANK
(d/b/a Santander and Banco Santander)
(Translation of Registrant’s name into English)

 

Chile
(Jurisdiction of incorporation or organization)

 

Bandera 140, 20th floor
Santiago, Chile
Telephone: 011-562-320-2000

(Address of principal executive offices)

 

Cristian Vicuña
Tel: 562 26483583, email: cristian.vicuna@santander.cl
Bandera 140, 20th Floor, Santiago, Chile

(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

 

Securities registered or to be registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbols   Name of each exchange on which registered
American Depositary Shares (“ADS”), each representing the right to receive 400 Shares of Common Stock without par value   BSAC   New York Stock Exchange
Shares of Common Stock, without par value*   BSAC   New York Stock Exchange

 

*Santander-Chile’s shares of common stock are not listed for trading, but only in connection with the registration of the American Depositary Shares pursuant to the requirements of the New York Stock Exchange.

 

Securities registered or to be registered pursuant to Section 12(g) of the Act:

 

None
(Title of Class)

 

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:

 

None
(Title of Class)

 

 

 

 

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report.

 

188,446,126,794 Shares of Common Stock, without par value

 

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

 

Yes           No

 

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

 

Yes          No

 

Note – Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

 

Yes ☒          No

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

 

Yes ☒          No

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large Accelerated Filer   Accelerated Filer   Non-accelerated Filer   Emerging growth company  

 

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act.

 

The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

 

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

 

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.

 

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).

 

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

 

U.S. GAAP

 

International Financial Reporting Standards as issued by the International Accounting Standards Board

 

Other

 

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.

 

Item 17          Item 18

 

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

 

Yes ☐          No

 

 

 

 

 

 

table of contents

 

  Page
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS ii
CERTAIN TERMS AND CONVENTIONS iv
PRESENTATION OF FINANCIAL INFORMATION iv
PART I 1
ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS 1
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE 1
ITEM 3. KEY INFORMATION 1
ITEM 4. INFORMATION ON THE COMPANY 36
ITEM 4A. UNRESOLVED STAFF COMMENTS 58
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS 59
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES 114
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS 126
ITEM 8. FINANCIAL INFORMATION 130
ITEM 9. THE OFFER AND LISTING 132
ITEM 10. ADDITIONAL INFORMATION 133
ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 150
ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES 169
PART II 171
ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES 171
ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS 171
ITEM 15. CONTROLS AND PROCEDURES 171
ITEM 16. [RESERVED] 172
ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT 172
ITEM 16B. CODE OF ETHICS 172
ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES 173
ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES 173
ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS 173
ITEM 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT 173
ITEM 16G. CORPORATE GOVERNANCE 174
ITEM 16H. MINE SAFETY DISCLOSURE 174
ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS 174
ITEM 16J. INSIDER TRADING POLICIES 174
ITEM 16K. CYBERSECURITY 174
PART III 176
ITEM 17. FINANCIAL STATEMENTS 176
ITEM 18. FINANCIAL STATEMENTS 176
ITEM 19. EXHIBITS 176

 

i

 

 

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

 

We have made statements in this Annual Report on Form 20-F that constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements appear throughout this report and include statements regarding our intent, belief or current expectations regarding:

 

asset growth and alternative sources of funding;

 

growth of our fee-based business;

 

financing plans;

 

impact of competition;

 

impact of regulation;

 

exposure to market risks including:

 

ointerest rate risk;

 

oforeign exchange risk; and

 

oequity price risk;

 

projected capital expenditures;

 

liquidity;

 

trends affecting:

 

oour financial condition; and

 

oour results of operation.

 

The sections of this Annual Report which contain forward-looking statements include, without limitation, “Item 3. Key Information—Risk Factors,” “Item 4. Information on the Company—B. Business Overview—Competition,” “Item 5. Operating and Financial Review and Prospects,” “Item 8. Financial Information—A. Consolidated Statements and Other Financial Information—Legal Proceedings,” and “Item 11. Quantitative and Qualitative Disclosures About Market Risk.” Our forward-looking statements also may be identified by words such as “believes,” “expects,” “anticipates,” “projects,” “intends,” “should,” “could,” “may,” “seeks,” “aim,” “combined,” “estimates,” “probability,” “risk,” “VaR,” “target,” “goal,” “objective,” “future” or similar expressions.

 

You should understand that the following important factors, in addition to those discussed elsewhere in this Annual Report and in the documents which are incorporated by reference, could affect our future results and could cause those results or other outcomes to differ materially from those expressed in our forward-looking statements:

 

changes in capital markets in general that may affect policies or attitudes towards lending to Chile or Chilean companies;

 

changes in economic conditions;

 

the monetary and interest rate policies of Central Bank (as defined below);

 

inflation;

 

ii

 

 

deflation;

 

unemployment;

 

increases in defaults by our customers and impairment losses;

 

decreases in deposits;

 

customer loss or revenue loss;

 

unanticipated turbulence in interest rates;

 

movements in foreign exchange rates;

 

movements in equity prices or other rates or prices;

 

the effects of non-linear market behavior that cannot be captured by linear statistical models, such as the VaR model we use;

 

changes in Chilean and foreign laws and regulations;

 

changes in taxes;

 

competition, changes in competition and pricing environments;

 

our inability to hedge certain risks economically;

 

the adequacy of loss allowances;

 

technological changes;

 

changes in consumer spending and saving habits;

 

changes in demographics;

 

changes in investment rates;

 

increased costs;

 

unanticipated increases in financing and other costs or the inability to obtain additional debt or equity financing on attractive terms;

 

changes in, or failure to comply with, banking regulations;

 

acquisitions or restructurings of businesses that may not perform in accordance with our expectations;

 

our ability to successfully market and sell additional services to our existing customers;

 

disruptions in client service;

 

damage to our reputation;

 

natural disasters;

 

iii

 

 

implementation of new technologies;

 

the Group’s exposure to operational losses (e.g., failed internal or external processes, people and systems);

 

an inaccurate or ineffective client segmentation model; and

 

pandemics.

 

You should not place undue reliance on such statements, which speak only as of the date at which they were made. The forward-looking statements contained in this report speak only as of the date of this Annual Report, and we do not undertake to update any forward-looking statement to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

 

CERTAIN TERMS AND CONVENTIONS

 

As used in this annual report (the “Annual Report”), “Santander-Chile”, “the Bank”, “we,” “our” and “us” or similar terms refer to Banco Santander-Chile together with its consolidated subsidiaries.

 

When we refer to “Santander Spain,” we refer to our parent company, Banco Santander, S.A. References to “the Group,” “Santander Group” or “Grupo Santander” mean the worldwide operations of the Santander Spain conglomerate, as indirectly controlled by Santander Spain and its consolidated subsidiaries, including Santander-Chile.

 

As used in this Annual Report, the term “billion” means one thousand million (1,000,000,000).

 

In this Annual Report, references to “$”, “U.S.$”, “U.S. dollars” and “dollars” are to United States dollars; references to “Chilean pesos,” “pesos” or “Ch$” are to Chilean pesos; references to “JPY” or “JPY$” are to Japanese Yen; references to “AUD” or “AUD$” are to Australian dollars; references to “CHF” or “CHF$” are to Swiss francs; references to “CNY” or “CNY$” are to Chinese yuan renminbi; and references to “UF” are to Unidades de Fomento. The UF is an inflation-indexed Chilean monetary unit with a value in Chilean pesos that changes daily to reflect changes in the official Consumer Price Index (“CPI”) of the Instituto Nacional de Estadísticas (the Chilean National Institute of Statistics) for the previous month.

 

As used in this Annual Report, the terms “write-offs” and “charge-offs” are synonyms.

 

In this Annual Report, references to the Audit Committee are to the Bank’s Comité de Directores y Auditoría.

 

In this Annual Report, references to “BIS” are to the Bank for International Settlement, and references to “BIS ratio” are to the capital adequacy ratio as calculated in accordance with the Basel Capital Accord. References to the “Central Bank” are to the Banco Central de Chile. References to the “FMC” are to the Financial Market Commission.

 

PRESENTATION OF FINANCIAL INFORMATION

 

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 International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). Any reference to IFRS in this document is to IFRS as issued by the IASB.

 

iv

 

 

As required by local regulations, our locally filed consolidated financial statements have been prepared in accordance with the Compendium of Accounting Standards issued by the FMC, the Chilean regulatory agency (“Chilean Bank GAAP”). Therefore, our locally filed consolidated financial statements have been adjusted to IFRS in order to comply with the requirements of the Securities and Exchange Commission (the “SEC”). Chilean Bank GAAP principles are substantially similar to IFRS but there are some exceptions. For further details and a discussion of the main differences between Chilean Bank GAAP and IFRS, see “Item 5. Operating and Financial Review and Prospects—Accounting Standards Applied in 2023.”

 

This Annual Report contains our consolidated financial statements as of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021 (the “Audited Consolidated Financial Statements”). Such Audited Consolidated Financial Statements have been prepared in accordance with IFRS as issued by the IASB, and have been audited by the independent registered public accounting firm PricewaterhouseCoopers Consultores, Auditores y Compañía Limitada for the years ended December 31, 2023, 2022 and 2021. See page F-3 of the Audited Consolidated Financial Statements as of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021 for the audit report issued by PricewaterhouseCoopers Consultores, Auditores y Compañía Limitada. The Audited Consolidated Financial Statements have been prepared from accounting records maintained by the Bank and its subsidiaries.

 

The notes to the Audited Consolidated Financial Statements form an integral part of the Audited Consolidated Financial Statements and contain additional information and narrative descriptions or details of these financial statements.

 

We have formatted our financial information according to the classification format for banks in Chile for purposes of IFRS. We have not reclassified the line items to comply with Article 9 of Regulation S-X. Article 9 is a regulation of the SEC that contains formatting requirements for bank holding company financial statements.

 

Functional and Presentation Currency

 

The Chilean peso is the currency of the primary economic environment in which the Bank operates and the currency that influences its structure of costs and revenues, and in accordance with International Accounting Standard 21 – The Effects of Changes in Foreign Exchange Rates has been defined as the functional and presentation currency. Accordingly, all balances and transactions denominated in currencies other than the Chilean peso are treated as “foreign currency.” See “Note 1—Summary of Significant Accounting Principles—e) Functional and presentation currency.” For presentation purposes, we have translated Chilean pesos (Ch$) into U.S. dollars (U.S.$) using the rate as indicated below under “Exchange Rates,” for the financial information included in this Annual Report.

 

Loans

 

Unless otherwise specified, all references herein (except in the Audited Consolidated Financial Statements) to loans are to loans and financial leases before deduction for loan loss allowance, and, except as otherwise specified, all market share data presented herein is based on information published periodically by the FMC.

 

Outstanding loans and the related percentages of our loan portfolio consisting of corporate and consumer loans as defined in the section entitled “Item 4. Information on the Company—B. Business Overview” are categorized based on the nature of the borrower. Outstanding loans and related percentages of our loan portfolio consisting of corporate and consumer loans in the section entitled “Item 5. Operating and Financial Review and Prospects—C. Selected Statistical Information” are categorized in accordance with the reporting requirements of the FMC, which are based on the type and term of loans.

 

v

 

 

Non-performing loans are also presented in accordance with reporting requirements of the FMC and include the entire principal amount and accrued but unpaid interest on loans for which either principal or interest is past-due for 90 days or more. Restructured loans for which no payments are past-due are not ordinarily classified as non-performing loans. See “Item 5. Operating and Financial Review and Prospects—C. Selected Statistical Information—Classification of Loan Portfolio Based on the Borrower’s Payment Performance.”

 

At the end of each reporting period the Bank evaluates the impairment of the loan book. For December 31, 2023, 2022 and 2021 this has been assessed in accordance with IFRS 9.

 

Effect of Rounding

 

Certain figures included in this Annual Report and in the Audited Consolidated Financial Statements have been rounded up for ease of presentation. Percentage figures included in this Annual Report have not in all cases been calculated on the basis of such rounded figures but on the basis of such amounts prior to rounding. For this reason, certain percentage amounts in this Annual Report may vary from those obtained by performing the same calculations using the figures in the Audited Consolidated Financial Statements. Certain other amounts that appear in this Annual Report may not sum due to rounding.

 

Economic and Market Data

 

In this Annual Report, unless otherwise indicated, all macroeconomic data related to the Chilean economy is based on information published by the Central Bank, and all market share and other data related to the Chilean financial system is based on information published by the FMC and our analysis of such information.

 

Exchange Rates

 

This Annual Report contains translations of certain Chilean peso amounts into U.S. dollars at specified rates solely for the convenience of the reader. These translations should not be construed as representations that the Chilean peso amounts actually represent such U.S. dollar amounts, were converted from U.S. dollars at the rate indicated in preparing the Audited Consolidated Financial Statements, could be converted into U.S. dollars at the rate indicated, were converted or will be converted at all.

 

Unless otherwise indicated, all U.S. dollar amounts at any year end, for any period have been translated from Chilean pesos based on the interbank market rate published by Reuters at 1:30 pm on the last business day of the period. On December 31, 2023 the exchange rate in the Informal Exchange Market as published by Reuters at 1:30 pm was Ch$874.45 per U.S.$1.00, or 1.15% less than the observed exchange rate published by the Central Bank for such date of Ch$884.59 per U.S.$1.00. The Federal Reserve Bank of New York does not report a noon buying rate for the Chilean peso.

 

The U.S. dollar equivalent of one UF was U.S.$41.59 as of December 31, 2023, using the observed exchange rate reported by the Central Bank as of December 30, 2023 of Ch$884.59 per U.S.$1.00, while the value of one UF as of December 31, 2023 was Ch$36,789.36.

 

vi

 

 

PART I

 

ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

 

Not applicable.

 

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE

 

Not applicable.

 

ITEM 3. KEY INFORMATION

 

A. [Reserved]

 

B. Capitalization and Indebtedness

 

Not applicable.

 

C. Reasons for the Offer and Use of Proceeds

 

Not applicable.

 

D. Risk Factors

 

You should carefully consider the following risk factors, which should be read in conjunction with all the other information presented in this Annual Report. The risks and uncertainties described below are not the only ones that we face. Additional risks and uncertainties that we do not know about or that we currently think are immaterial may also impair our business operations. Any of the following risks, if they actually occur, could materially and adversely affect our business, results of operations, prospects and financial condition. The following risk factors have been grouped as follows:

 

(a) Risk Factors in respect of Santander-Chile;

 

(b) Risk Factors in respect of Chile;

 

(c) Risk Factors in respect of our Controlling Shareholder and our ADSs; and

 

(d) General Risk Factors.

 

The risk factors in respect of Santander-Chile are presented in the following subcategories depending on their nature:

 

(a) Macro-economic Risks;

 

(b) Competitive Risks;

 

(c) Operational Risks;

 

(d) Financial Risks; and

 

(e) Legal and Regulatory Risks.

 

1

 

 

Summary of Key Risks

 

Our business is subject to numerous risks and uncertainties, discussed in more detail below. These risks include, among others, the following key risks:

 

The growth rate of our loan portfolio may be affected by economic turmoil, which could also lead to a contraction in our loan portfolio.

 

Inflation, government efforts to control inflation, and changes in interest rates may hinder the growth of the Chilean economy and could have an adverse effect on us.

 

The continuance or escalation of the war in Ukraine and the conflict in the Middle East could materially affect our financial position and increase our operational risk.

 

Our operations and results have been negatively impacted by the coronavirus outbreak.

 

We are vulnerable to disruptions and volatility in the global financial markets.

 

Our operations and results may be negatively affected by earthquakes due to the location of Chile in a highly seismic area.

 

Climate change can create transition risks, physical risks, and other risks that could adversely affect us.

 

Increased competition, including from non-traditional providers of banking services such as financial technology providers, and industry consolidation may adversely affect our results of operations.

 

Our ability to maintain our competitive position depends, in part, on the success of new products and services we offer our customers.

 

The growth of our loan portfolio may expose us to increased loan losses. Our exposure to individuals and small and mid-sized businesses could lead to higher levels of past due loans, allowances for loan losses and charge-offs.

 

Failure to successfully implement and continue to improve our risk management policies, procedures and methods, including our credit risk management system, could materially and adversely affect us, and we may be exposed to unidentified or unanticipated risks.

 

We rely on models for many of our decisions. Their inaccurate or incorrect use could have a material adverse effect on us.

 

Our loan and investment portfolios are subject to risk of prepayment, which could have a material adverse effect on us.

 

Risks relating to cybersecurity, data collection, processing and storage systems and security are inherent in our business.

 

Disclosure controls and procedures over financial and non-financial reporting may not prevent or detect all errors or acts of fraud.

 

Market conditions have resulted, and could result, in material changes to the estimated fair values of our financial assets. Negative fair value adjustments could have a material adverse effect on our operating results, financial condition and prospects.

 

Our financial results are constantly exposed to market risk. We are subject to fluctuations in inflation, interest rates and other market risks, which may materially and adversely affect us and our profitability.

 

We are subject to counterparty risk in our banking business.

 

Liquidity and funding risks are inherent in our business and could have a material adverse effect on our results, our costs of funds and our credit ratings.

 

2

 

 

We are subject to regulatory capital and liquidity requirements that could limit our operations, and changes to these requirements may further limit and adversely affect our operating results, financial condition and prospects.

 

We are subject to extensive regulatory risk, or the risk of not being able to meet all of the applicable regulatory requirements and guidelines.

 

Changes to the pension fund system may affect the funding mix of the Bank.

 

We may not be able to detect or prevent money laundering and other financial crime activities fully or on a timely basis, which could expose us to additional liability and could have a material adverse effect on us.

 

We are exposed to risk of loss from legal and regulatory proceedings.

 

Political, legal, regulatory and economic uncertainty arising from social unrest and the resulting social reforms, as well as the potential enactment of a new constitution could adversely impact the Bank’s business.

 

Our growth, asset quality and profitability may be adversely affected by macroeconomic and political conditions in Chile.

 

Currency fluctuations could adversely affect our financial condition and results of operations and the value of our securities.

 

Our controlling shareholder has a great deal of influence over our business and its interests could conflict with yours.

 

Our status as a controlled company and a foreign private issuer exempts us from certain of the corporate governance standards of the New York Stock Exchange (“NYSE”), limiting the protections afforded to investors.

 

As a holder of ADSs you will have different shareholders’ rights than in the United States and certain other jurisdictions.

 

Holders of ADSs may find it difficult to exercise voting rights at our shareholders’ meetings.

 

RISK FACTORS IN RESPECT OF SANTANDER-CHILE

 

Macro-Economic Risks

 

Our growth, asset quality and profitability, among others, may be adversely affected by a slowdown in the global and Chilean economy, volatile macroeconomic and political conditions.

 

A slowdown or recession in the global economy could lead major financial institutions, including some of the world’s largest global commercial banks, investment banks, mortgage lenders, mortgage guarantors and insurance companies to experience significant difficulties, including runs on deposits, the need for government aid or assistance or the need to reduce or cease providing funding to borrowers (including to other financial institutions).

 

Volatile conditions in the global financial markets could also have a material adverse effect on us, including on our ability to access capital and liquidity on financial terms acceptable to us, if at all. If capital markets financing ceases to become available, or becomes excessively expensive, we may be forced to raise the rates we pay on deposits to attract more customers and become unable to maintain certain liability maturities. Any such increase in capital markets funding availability or costs or in deposit rates could have a material adverse effect on our interest margins and liquidity.

 

In particular, we face, among others, the following risks related to economic downturns and volatile conditions:

 

Reduced demand for our products and services.

 

Increased regulation of our industry. Compliance with such regulation would likely continue to increase our costs and may affect the pricing for our products and services, increase our conduct and regulatory risks related to non-compliance and limit our ability to pursue business opportunities.

 

3

 

 

Inability of our borrowers to timely or fully comply with their existing obligations. Macroeconomic shocks may negatively impact the income of our customers, both retail and corporate, and may adversely affect the recoverability of our loans, resulting in increased loan losses.

 

The process we use to estimate losses inherent in our credit exposure requires complex judgements, including forecasts of economic conditions and how these economic conditions might impair the ability of our borrowers to repay their loans. The degree of uncertainty concerning economic conditions may adversely affect the accuracy of our estimates, which may, in turn, impact the reliability of the process and the sufficiency of our loan loss allowances.

 

The value and liquidity of the portfolio of investment securities that we hold may be adversely affected.

 

In particular, in 2023 the Chilean economy experienced a moderate recession because of the high interest rate environment. To contain inflation, central banks around the world, including the Central Bank of Chile, increased interest rates. During 2022, the Central Bank raised interest rates seven times to a high of 11.25% in December 2022. As of the end of 2022, inflation reached 12.8% based on the Chilean consumer price index. As of the end of 2023, inflation began to subside and finished the year at 3.9% based on the Chilean consumer price index. The high interest rate environment contributed to a slowdown of the Chilean economy in 2022 and 2023, following GDP growth of 11.7% in 2021. In 2022, Chile’s economy grew 2.4% and in 2023 GDP is expected to have contracted by 0.2%. Currently, the Central Bank expects GDP to increase in a range between 1.25%-2.25% in 2024. These or other conditions causing market turmoil or economic recession in the future could have a material adverse effect on our financing availability and terms and, more generally, on our results, financial condition and prospects.

 

The growth rate of our loan portfolio may be affected by economic turmoil, which could also lead to a contraction in our loan portfolio.

 

There can be no assurance that our loan portfolio will continue to grow at similar rates to historical growth rates. A reversal of the rate of growth of the Chilean economy, a slowdown in the growth of customer demand, an increase in market competition or changes in governmental regulations could adversely affect the rate of growth of our loan portfolio and our risk index and, accordingly, increase our required allowances for loan losses. Economic turmoil could materially adversely affect the liquidity, businesses and financial condition of our customers as well as lead to a general decline in consumer spending and a rise in unemployment. All this could in turn lead to decreased demand for borrowings in general.

 

Climate change can create transition risks, physical risks, and other risks that could adversely affect us.

 

There is an increasing focus over the risks of climate change and related environmental sustainability matters.

 

Climate change may imply two primary drivers of financial risk that could adversely affect us:

 

Transition risks associated with the move to a low-carbon economy, both at idiosyncratic and systemic levels, such as through policy, regulatory and technological changes and business and consumer preferences, which could increase our exposures and impact our strategies.

 

Physical risks related to discrete events, such as flooding and wildfires, and extreme weather impacts and longer term shifts in climate patterns, such as extreme heat, sea level rise and more frequent and prolonged drought, which could result in financial losses that could impair asset values and the creditworthiness of our customers. Such events could disrupt our operations or those of our customers or third parties on which we rely and do business with, including through direct damage to assets and indirect impacts from supply chain disruption and market volatility.

 

These primary drivers could materialize, among others, in the following financial risks:

 

Credit risks: Physical climate change could lower corporate revenues, increase operating costs and lead to increased credit exposure. Severe weather could also affect collateral value. Additionally, companies with business models not aligned with the transition to a low-carbon economy may face a higher risk of reduced corporate earnings and business disruption due to new regulations or market shifts.

 

Market risks: Market changes in the most carbon-intensive sectors could affect energy and commodity prices, corporate bonds, equities and certain derivatives contracts. Increasing frequency of severe weather events could affect macroeconomic conditions, weakening fundamental factors such as economic growth, employment and inflation and lead to higher volatility.

 

4

 

 

Liquidity risks: Companies could face liquidity risks derived from cash outflows to improve their reputation in the market or solve climate-related problems. Extreme weather events could also affect the value of our high-quality liquid assets or cause sovereign debt to rise limiting our access to capital markets.

 

Operational risks: Severe weather events could directly damage assets and impact business continuity, both of customers and ours. Climate-related financial risks could also cause operational risk losses from litigation if, for example, we are perceived to misrepresent sustainability-related practices, achievements, metrics goals or targets.

 

Regulatory compliance risks: Increased regulatory compliance risk may result from the increasing pace, breadth and depth of regulatory expectations requiring implementation in short timeframes across multiple jurisdictions and from changes in public policy, laws and regulations in connection with climate change and related environmental sustainability matters.

 

Reputational risks: Our reputation and client relationships may be damaged as a result of our practices, disclosures and decisions related to climate change and the environment, or to the practices or involvement of our clients, vendors or suppliers in certain industries or projects being associated with causing or exacerbating climate change. Furthermore, parties who may suffer losses from the effects of climate change may seek compensation from those they hold responsible such as state entities, regulators, investors and lenders. We could face conduct risks derived from misrepresentations in our sustainability-related disclosures, including our practices, achievements, metrics, goals and targets or the sustainability characteristics of our products or of our customers, investors or other stakeholders (greenwashing).

 

Strategic risks: Our strategy could be affected if we fail to achieve our net-zero or other targets, including those related to the activities that we finance and those concerning our own operations.

 

As climate risk is interconnected with all key risk types, we have developed and continue to enhance processes to embed climate risk considerations into our core processes and risk management cycle; however, because the timing and severity of climate change may not be predictable and is rapidly evolving, our risk management strategies may not be effective in mitigating climate risk exposure. Additionally, we may become subject to new or heightened regulatory requirements relating to climate change, which may result in increased regulatory, compliance or other costs. As the risks, perspective and focus of regulators, shareholders, employees, and other stakeholders regarding climate change are evolving rapidly, it can be difficult to assess the ultimate impact on us of climate change-related risks, compliance risks, and uncertainties.

 

We periodically disclose information such as emissions and other climate-related performance data, statistics, metrics and/or targets. If we lack robust and high-quality climate-related procedures, controls and data, we may not be able to disclose reliable climate-related information. In addition, because the climate-related information is based on current expectations and future estimates about Santander Chile’s and third-parties’ operations and businesses and addresses matters that are uncertain to varying degrees, we may not be able to meet our estimates, targets or commitments or we may not be able to achieve them within the timelines we announce. Actual or perceived shortcomings with respect to these emissions and other climate-related initiatives and reporting could result in litigation or regulatory enforcement and impact our ability to hire and retain employees, increase our customer base, and attract and retain certain types of investors.

 

Any of the conditions described above, or our failure to identify other climate-related risks, could have a material adverse effect on our business, financial condition and results of operations.

 

Pandemics, including the global COVID-19 pandemic, and other public health emergencies materially impacted, and may in the future materially impact, our financial condition, liquidity and results of operations.

 

Our business was materially impacted by the COVID-19 pandemic in 2020 and 2021. Although the Chilean economy has mostly recovered from the COVID-19 pandemic, certain adverse effects of the pandemic continue to impact the macroeconomic environment, such as the rise in inflation due to strong injections of liquidity in the economy during the pandemic, which forced the Central Bank of Chile to significantly tighten monetary policy to bring inflation back to levels it considers sustainable. Should the ongoing effects of the COVID-19 pandemic continue for an extended period of time, or worsen, our business, financial position, liquidity, results of operations and prospects could be adversely affected.

 

5

 

 

On August 31, 2023, the Ministry of Health of Chile declared the end of the public health alert for COVID-19. However, no assurances can be made as to whether the emergence of new variants of COVID-19, which may be resistant to existing vaccines, remains possible or the emergence of another pandemic in the future with similar impacts on the global economy.

 

In 2020, the Chilean government also announced a series of measures to support lending as a result of the economic dislocation seen at the beginning of the COVID-19 pandemic. The largest measures were to provide an additional U.S.$3 billion to the Fondo de Garantía para Pequeños Empresarios (Small Enterprise Guarantees Fund, or “FOGAPE”), a state fund that guarantees loans, leases and other credits provided to small businesses, extend FOGAPE’s coverage to companies with annual sales of up to UF 1 million (U.S.$41 million) and further amend the rules and regulations governing FOGAPE to encourage banks to provide lending to small businesses. As of December 31, 2023, we had Ch$230,474 million outstanding in FOGAPE loans disbursed to support lending during the COVID-19 crisis. We did not grant new FOGAPE loans related to COVID-19 during 2023.

 

Although we have received guarantees from FOGAPE for a portion of the FOGAPE loans we have granted, if our clients default on their payment obligations under these loans when they become due, or they otherwise fail to timely comply with their obligations under these loans, this will result in higher levels of non-performing loans in the future and require the recognition of additional allowances for loan losses. Moreover, we must share with FOGAPE a portion of any recovery made on non-performing loans guaranteed by FOGAPE.

 

Competitive Risks

 

Increased competition, including from non-traditional providers of banking services such as financial technology providers, and industry consolidation may adversely affect our results of operations.

 

We face substantial competition in all parts of our business, including in payments, in originating loans and in attracting deposits. The competition in originating loans comes principally from other domestic and foreign banks, mortgage banking companies, consumer finance companies, insurance companies and other lenders and purchasers of loans.

 

The Chilean market for financial services is highly competitive. We compete with other private sector Chilean and non-Chilean banks, with Banco del Estado de Chile, the principal government-owned sector bank, with department stores, private lenders (principally department stores and auto-lenders) and with credit unions and cooperatives that make consumer loans and sell other financial products to a large portion of the Chilean population. In addition, we face competition from non-bank finance competitors, such as leasing and factoring companies, security brokers, mutual fund administrators, pension fund management companies and insurance companies. The lower to middle-income segments of the Chilean population and the small- and mid-sized corporate segments have become the target markets of several banks and competition in these segments may increase. In addition, there has been a trend towards consolidation in the Chilean banking industry in recent years, which has created larger banks with which we must now compete. There can be no assurance that this increased competition will not adversely affect our growth prospects, and therefore our operations.

 

Non-traditional providers of banking services, such as fintechs, Internet-based e-commerce providers, mobile telephone companies and Internet search engines may offer and/or increase their offerings of financial products and services directly to customers. These non-traditional providers of banking services currently have an advantage over traditional providers because they are not subject to banking regulation. Several of these competitors may have long operating histories, large customer bases, strong brand recognition and significant financial, marketing and other resources. They may adopt more aggressive pricing and rates and devote more resources to technology, infrastructure and marketing.

 

New competitors may enter the market or existing competitors may adjust their services with unique product or service offerings or approaches to providing banking services. If we are unable to successfully compete with current and new competitors, or if we are unable to anticipate and adapt our offerings to changing banking industry trends, including technological changes, our business may be adversely affected. In addition, our failure to effectively anticipate or adapt to emerging technologies or changes in customer behavior, including among younger customers, could delay or prevent our access to new digital-based markets, which would in turn have an adverse effect on our competitive position and business. Furthermore, the widespread adoption of new technologies, including distributed ledger, artificial intelligence (“AI”) and/or biometrics, to provide services such as cryptocurrencies and payments, could require substantial expenditures to modify or adapt our existing products and services as we continue to grow our Internet and mobile banking capabilities and could entail new direct risks (including financial and non-financial risks) and indirect risks related to loss of business opportunities. Our customers may choose to conduct business or offer products in areas that may be considered speculative or risky. Such new technologies and mobile banking platforms in recent years could negatively impact the value of our investments in bank premises, equipment and personnel for our branch network.

 

6

 

 

The persistence or acceleration of this shift in demand towards Internet and mobile banking may necessitate further changes to our retail distribution strategy, which may include closing and/or selling certain branches (as we have been doing in recent years) and restructuring our remaining branches and work force. These actions could lead to losses on these assets and may lead to increased expenditures to renovate, reconfigure or close a number of our remaining branches or to otherwise reform our retail distribution channel. Furthermore, our failure to implement such changes to our distribution strategy swiftly and effectively could have an adverse effect our competitive position.

 

In particular, we face the challenge to compete in an ecosystem where the relationship with the consumer is based on access to digital data. This access is increasingly dominated by digital platforms and fintechs who are already eroding our results in very relevant markets such as payments. This privileged access to data can be used as a leverage to compete with us in other adjacent markets and may reduce our operations and margins in core businesses such as lending or wealth management. The alliances that our competitors are starting to build with large technology firms can make it more difficult for us to successfully compete with them and could adversely affect us.

 

Increasing competition could also require that we increase our rates offered on deposits or lower the rates we charge on loans, which could also have a material adverse effect on us, including our profitability. It may also negatively affect our business results and prospects by, among other things, limiting our ability to increase our customer base and expand our operations and increasing competition for investment opportunities.

 

If our customer service levels were perceived by the market to be materially below those of our competitor financial institutions, we could lose existing and potential business. If we are not successful in retaining and strengthening customer relationships, we may lose market share, incur losses on some or all of our activities or fail to attract new deposits or retain existing deposits, which could have a material adverse effect on our operating results, financial condition and prospects.

 

Our ability to maintain our competitive position depends, in part, on the success of new products and services we offer our customers and on our ability to offer products and services that meet the customers’ needs during the whole life cycle of the products or services. Our failure to manage various risks we face as we expand our range of products and services that could have a material adverse effect on us.

 

The success of our operations and our profitability depends, in part, on the success of new products and services we offer our customers and our ability to offer products and services that meet their needs during their entire life cycle. However, our customers’ needs, or desires may change over time, and such changes may render our products and services obsolete, outdated or unattractive and we may not be able to develop new products that meet our customers’ changing needs. Our success is also dependent on our ability to anticipate and leverage new and existing technologies that may have an impact on products and services in the banking industry. Technological changes may further intensify and complicate the competitive landscape and influence customer behavior. If we cannot respond in a timely fashion to the changing needs of our customers, we may lose existing or potential customers, which could in turn materially and adversely affect us. In addition, the cost of developing products is likely to affect our results of operations.

 

As we expand the range of our products and services, some of which may be at an early stage of development in the markets of certain regions where we operate, we will be exposed to new and potentially increasingly complex risks, such as the conduct risk in the relationship with customers, and development expenses. Our employees and our risk management systems, as well as our experience and that of our partners may not be sufficient to enable us to properly manage such risks. Any or all of these factors, individually or collectively, could have a material adverse effect on us.

 

7

 

 

Our strong position in the credit card market is in part due to our credit card co-branding agreement with Latam Airlines. This agreement was renewed in January 2019 for seven more years. Once this agreement expires, no assurance can be given that it will be renewed, which may materially and adversely affect our results of operations and financial condition in the credit card business.

 

While we have successfully increased our customer service levels in recent years, should these levels ever be perceived by the market to be materially below those of our competitor financial institutions, we could lose existing and potential new business. If we are not successful in retaining and strengthening customer relationships, we may lose market share, incur losses on some or all of our activities or fail to attract new deposits or retain existing deposits, which could have a material adverse effect on our operating results, financial condition and prospects.

 

Operational Risks

 

The financial problems faced by our customers could adversely affect us.

 

Potential market turmoil and economic recession could materially and adversely affect the liquidity, credit ratings, businesses and/or financial conditions of our customers. In 2023, inflationary pressures remained high mainly due to high levels of liquidity still circulating in the local and global economy. In an effort to contain inflation, central banks, including the Central Bank, have increased interest rates, leading to a global economic slowdown. These or other conditions causing market turmoil or economic recession in the future could increase our non-performing loan ratios, impair our loan and other financial assets and result in decreased demand for borrowings and deposits in general. A worsening of macroeconomic conditions may also lead to significant volatility in financial markets. As a result, our customers may in the future decrease their risk tolerance to non-deposit investments such as stocks, bonds and mutual funds, which would adversely affect our fee and commission income. Any of the conditions described above could have a material adverse effect on our business, financial condition and results of operations.

 

We may generate lower revenues from fee and commission-based businesses.

 

A portion of the Bank’s fee income is derived from brokerage of mutual funds, stocks and bonds and a market downturn could result in significantly lower fees from these sources. The fees and commissions that we earn from the different banking and other financial services that we provide represent a significant source of our revenues. Regulatory changes that modify the fees we may charge could adversely affect our fee and commission income.

 

In 2022 and 2023, new regulations regarding interchange fees for credit and debit cards were enacted in Chile, reducing fees which banks may charge from acquirers. We expect that this reduction will have a significant impact on our revenue from card fees which we expect will decrease by approximately Ch$25 billion in 2024 and approximately Ch$ 47 billion in 2025.

 

Banco Santander Chile sold its asset management business in 2013 and signed a management service agreement for a 10 year-period, automatically renewable for five-year periods, with the acquirer of this business in which we sell asset management funds on their behalf. Therefore, even in the absence of a market downturn, below-market performance by the mutual funds of the firm we broker for may result in a reduction in revenue we receive from selling asset management funds and adversely affect our results of operations.

 

The growth of our loan portfolio may expose us to increased loan losses. Our exposure to individuals and small and mid-sized businesses could lead to higher levels of past due loans, allowances for loan losses and charge-offs.

 

The further expansion of our loan portfolio (particularly in the consumer, small- and mid-sized companies and real estate segments) can be expected to expose us to a higher level of loan losses and require us to establish higher levels of provisions for loan losses. See “Note 8—Financial Assets at Amortized Cost” and “Note 6—Financial Assets At Fair Value Through Other Comprehensive Income” in our Audited Consolidated Financial Statements for a description and presentation of our loan portfolio as well as “Item 5. Operating and Financial Review and Prospects—C. Selected Statistical Information—Loan Portfolio.”

 

Retail customers represent 71.2% of the value of the total loan portfolio at amortized cost as of December 31, 2023. As part of our business strategy, we seek to increase lending and other services to retail clients, which are more likely to be adversely affected by downturns in the Chilean economy and other economic conditions, including the high inflation experienced in the first half of 2023. In addition, as of December 31, 2023, our residential mortgage loan portfolio totaled Ch$17,073,439 million, representing 41.8% of our total loans. See “Note 8—Financial Assets at Amortized Cost” in our Audited Consolidated Financial Statements for a description and presentation of our residential mortgage loan portfolio. If the economy and real estate market in Chile experience a significant downturn, this could materially adversely affect the liquidity, businesses and financial conditions of our customers, which may in turn cause us to experience higher levels of past-due loans, thereby resulting in higher provisions for loan losses and subsequent charge-offs. This may materially and adversely affect our asset quality, results of operations and financial condition.

 

8

 

 

Failure to successfully implement and continue to improve our risk management policies, procedures and methods, including our credit risk management systems, could materially and adversely affect us, and we may be exposed to unidentified or unanticipated risks.

 

Risk management is a central part of our activities. We seek to manage and control our risk exposure through forward-looking management model, based on robust governance and advanced risk management tools, supported by a risk culture that permeates the organization. While our management model uses a broad and diversified set of risk monitoring, control and mitigation techniques, such management model may not be fully effective at mitigating our risk exposure in all economic market environments or against all types of risk, including risks that we may fail to identify or anticipate.

 

Some of our tools and metrics for managing risk are based on our use of observed historical market behavior. We apply statistical and other tools to these observations to arrive at quantifications of our risk exposures. These tools and metrics may fail to predict future risk exposures. These risk exposures could, for example, arise from factors we did not anticipate or correctly evaluate in our statistical models. This would limit our ability to manage our risks. Our losses thus could be significantly greater than the historical measures indicate. In addition, our statistical models may not take all risks into account or measure emerging risks correctly.

 

Our approach to managing risks could prove insufficient, exposing us to material unanticipated losses. We could face adverse consequences as a result of decisions, which may lead to actions by management, based on models that are poorly developed, implemented or used, or as a result of the modelled outcome being misunderstood or the use of such information for purposes for which it was not designed. If existing or potential customers or counterparties believe our risk management is inadequate, they could take their business elsewhere or seek to limit their transactions with us. Any of these factors could have a material adverse effect on our reputation, operating results, financial condition and prospects.

 

As a retail bank, one of the main types of risks inherent in our business is credit risk. For example, an important feature of our credit risk management system is to employ an internal credit rating to assess the particular risk profile of individual customers and SMEs. As this process involves detailed analyses of the customer, taking into account both quantitative and qualitative factors, it is subject to human or information technology systems errors. In exercising their judgement on our customers’ current or future credit risk behavior, our management models may not always be able to assign an accurate credit rating, which may result in a higher exposure to credit risks than indicated by our risk rating system.

 

Some of the models and other analytical and judgement-based estimations we use in managing risks are subject to review by, and require the approval of, our regulators. If models do not comply with all their expectations, our regulators may require us to make changes to such models, may approve them with additional capital requirements or we may be precluded from using them. Any of these possible situations could limit our ability to expand our businesses or have a material impact on our financial results.

 

Failure to effectively implement, consistently monitor or continuously improve our credit risk management system may result in an increase in the level of non-performing loans and a higher risk exposure for us, which could have a material adverse effect on us.

 

In addition, failure to successfully execute any of our decisions and actions affecting or changing our practices, operations, priorities, strategies, policies, procedures, or frameworks, could have a material adverse effect on us.

 

9

 

 

The effectiveness of our credit risk management is affected by the quality and scope of information available in Chile.

 

In assessing customers’ creditworthiness, we rely largely on the credit information available from our own internal databases, the FMC, the Directorio de Información Comercial (Dicom), a Chilean nationwide credit bureau, and other sources. Due to limitations in the availability of information and the developing information infrastructure in Chile, our assessment of credit risk associated with a particular customer may not be based on complete, accurate or reliable information. In addition, although we have been improving our credit scoring systems to better assess borrowers’ credit risk profiles, we cannot assure you that our credit scoring systems will collect complete or accurate information reflecting the actual behavior of customers or that their credit risk can be assessed correctly. Without complete, accurate and reliable information, we will have to rely on other publicly available resources and our internal resources, which may not be effective. As a result, our ability to effectively manage our credit risk and subsequently our loan loss allowances may be materially adversely affected.

 

We rely on models for many of our decisions. Their inaccurate or incorrect use could have a material adverse effect on us.

 

We use models for admission (scoring and rating), and behavioral credit processes, for the calculation of capital, provisions, market and structural risk, operational, compliance and liquidity risk. A model is a system, approach or quantitative method that applies statistical, economic, financial or mathematical theories, techniques or hypotheses to transform input data into quantitative estimates and forecasts. It involves simplified representations of real-world relationships between characteristics, values and observed assumptions that allows us to focus on specific aspects.

 

Model risk is the negative consequence of decisions based on inaccurate, improper or incorrect use of models. Sources of model risk include (i) incorrect or incomplete data in the model itself or the modelling method used in systems; and (ii) incorrect use or implementation of the model.

 

Model risk can cause financial loss, erroneous commercial and strategic decision-making or damage to our transactions any of which could have a material adverse effect on our operating results, financial condition and prospects. In addition, our regulatory models and the underlying methodologies are subject to scrutiny from our regulators and supervisory bodies, who could identify potential weaknesses or deficiencies that may result in enforcement actions, including sanctions, fines and/or the imposition of stricter capital requirements, as well as mandates and recommendations with respect to the methodologies underlying our models, which could also lead us to more onerous or inefficient capital consumptions.

 

Unprecedented movement in economic and market drivers related to external events requires monitoring and adjusting of financial models (including credit loss models, capital models, traded risk models and models used in the asset/liability management process) to comply with the guidance and recommendations of standard setters, regulators and supervisors, particularly for credit loss models. It also results in the use of mitigants for model limitations, such as adjustments to model outputs to reflect consideration of management judgment. The performance and usage of models was and may continue to be impacted by the consequences of external events. In addition, data obtained during these external events may not be representative and may distort the calibration of the models in the future, which could have a material adverse effect on us.

 

In addition, the fair value of our financial assets, determined using financial valuation models, may be inaccurate or subject to change and, as a consequence, we may have to register impairments or write-downs that could have a material adverse effect on our operating results, financial condition and prospects. See more information in “—Market conditions have resulted and could result in material changes to the estimated fair values of our financial assets. Negative fair value adjustments could have a material adverse effect on our operating results, financial condition and prospects.”

 

Our loan and investment portfolios are subject to risk of prepayment, which could have a material adverse effect on us.

 

Our fixed rate loan and investment portfolios are subject to prepayment risk, which results from the ability of a borrower or issuer to pay a debt obligation prior to maturity. Generally, in a declining interest rate environment, prepayment activity increases, which reduces the weighted average lives of our earning assets and could have a material adverse effect on us. We expect a significant reduction in short-term rates to occur in 2024, which could increase prepayment risk of our loan book. We would also be required to amortize net premiums into income over a shorter period of time, thereby reducing the corresponding asset yield and net interest income. Prepayment risk also has a significant adverse impact on credit card and collateralized mortgage loans, since prepayments could shorten the weighted average life of these assets, which may result in a mismatch in our funding obligations and reinvestment at lower yields. Prepayment risk is inherent to our commercial activity and an increase in prepayments or a reduction in prepayment fees could have a material adverse effect on us. The Chilean government is presently analyzing an initiative to reduce or limit prepayment fees and the Bank does not yet have an estimate of the potential impact of such initiatives. We cannot assure you that this change or any future regulatory changes related to prepayment fees will not have a material impact on our business.

 

10

 

 

If we are unable to manage the growth of our operations or to integrate successfully our inorganic growth, this could have an adverse impact on our profitability.

 

We allocate management and planning resources to develop strategic plans for organic growth, and to identify possible acquisitions and disposals and areas for restructuring our businesses. From time to time, we evaluate acquisition and partnership opportunities that we believe offer additional value to our shareholders and are consistent with our business strategy. However, we may not be able to identify suitable acquisition or partnership candidates, and our ability to benefit from any such acquisitions and partnerships will depend in part on our successful integration of those businesses. Any such integration entails significant risks such as unforeseen difficulties in integrating operations and systems, unexpected liabilities or contingencies relating to the acquired businesses, including legal claims and delivery and execution risks. We can give no assurances that our expectations with regards to integration and synergies will materialize. We also cannot provide assurance that we will, in all cases, be able to manage our growth effectively or deliver our strategic growth objectives. Challenges that may result from our strategic growth decisions include our ability to:

 

manage efficiently the operations and employees of expanding businesses;

 

maintain or grow our existing customer base;

 

assess the value, strengths and weaknesses of investment or acquisition candidates, including local regulation that can reduce or eliminate expected synergies;

 

finance strategic investments or acquisitions;

 

align our current information technology systems adequately with those of an enlarged group;

 

apply our risk management policy effectively to an enlarged group; and

 

manage a growing number of entities without over-committing management or losing key personnel.

 

Any failure to manage growth effectively could have a material adverse effect on our operating results, financial condition and prospects.

 

In addition, any acquisition or venture could result in the loss of key employees and inconsistencies in standards, controls, procedures and policies.

 

Moreover, the success of the acquisition or venture will at least in part be subject to a number of political, economic and other factors that are beyond our control. Any of these factors, individually or collectively, could have a material adverse effect on us.

 

Any failure to improve or upgrade our information technology infrastructure and information management systems in an effective, timely and cost-effective manner, including in response to new or modified cybersecurity and data privacy laws, rules and regulations could have a material adverse effect on us.

 

Our ability to remain competitive depends in part on our ability to upgrade our information technology in an effective, timely and cost-effective manner. We must continually make significant investments in and improvements to our information technology infrastructure and information management systems in order to meet the needs of our customers. We cannot guarantee that in the future we will be able to maintain the level of capital expenditures necessary to support the continuous improvement and upgrading of our information technology infrastructure and information management systems and networks. To the extent we are dependent on any particular technology or technological solution, we may be harmed if such technology or technological solution becomes non-compliant with existing industry standards or applicable laws, rules or regulations, fails to meet or exceed the capabilities of our competitors’ equivalent technologies or technological solutions, becomes increasingly expensive to service, retain and update, becomes subject to third-party claims of intellectual property infringement, misappropriation or other violation, or malfunctions or functions in a way we did not anticipate. Additionally, new technologies and technological solutions, such as AI, are continually being released. As such, it is difficult to predict the problems we may encounter in improving our technologies’ functionality. There is no assurance that we will be able to successfully adopt new technology as critical systems and applications become obsolete and better ones become available. Any failure to effectively improve or upgrade our information technology infrastructure and information management systems and networks in an effective, timely and cost-efficient manner could have a material adverse effect on us.

 

11

 

 

Any failure or disruption of our operational processes or systems, or data breaches and other security incidents with respect to our or our third-party vendors’ systems could adversely affect our business or reputation, and create significant legal, regulatory or financial exposure.

 

Like other financial institutions, in conducting our banking operations, we receive, manage, hold, transmit and otherwise process certain proprietary, sensitive or confidential information, including personal information of customers and employees, as well as a large number of assets. Accordingly, our business relies on our ability to process a large number of transactions efficiently and accurately, and on our ability to rely on our digital technologies, computer and email services, software and networks, as well as on the secure storage, transmission, and other processing of proprietary confidential, sensitive and personal data and other information using our computer systems and networks or those of our third-party vendors. The proper and secure functioning of our financial controls, accounting and other data collection and processing systems is critical to our business and to our ability to compete effectively.

 

Data breaches, data losses and other security incidents, including fraudulent withdrawal of money, can result from, among other things, inadequate personnel, inadequate or failed internal control processes and systems, or external events or actors that interrupt normal business operations and may include cyberattacks, disruptions, failures, unauthorized access or misuse, software bugs, server malfunctions, software and hardware failure, malware and ransomware, social engineering and phishing attacks, denial-of-service attacks, misconduct, fraud, and other events that could have a serious impact on us. We also face the risk that the design of our or our third-party vendors’ cybersecurity controls and procedures prove to be inadequate or are circumvented such that our data or client records are incomplete, not recoverable or not securely stored. Moreover, it is not always possible to deter or prevent employee errors or misconduct, and the precautions we take to detect and prevent this activity may not always be effective. Any material disruption or slowdown of our systems could cause information, including data related to customer requests, to be lost or to be delivered to our clients with delays or errors, which could reduce demand for our services and products, produce customer claims and materially and adversely affect us.

 

Early identification and risk mitigation stand as our priorities in our goal to provide a resilient and secure operational environment. We monitor potential risks, including the vulnerabilities that arise in our interactions with third parties, and seek to identify and implement controls to mitigate them promptly. In this regard, although (i) we have policies, procedures and controls in place designed to safeguard proprietary sensitive and confidential information, including personal information, (ii) we take protective technical measures and monitor and develop our systems and networks to protect our technology infrastructure, data and information from misappropriation or corruption, and (iii) we work with our clients, vendors, service providers, counterparties and other third parties to develop secure data and information processing, collection, authentication, management, usage, storage and transmission capabilities and to ensure the eventual destruction of proprietary, sensitive and confidential information, including personal information, we, our third-party vendors or other third parties with which we do business have been and may continue to be subject to cyberattacks and other cybersecurity incidents. The implementation of our cybersecurity policies, procedures, controls and technical measures is designed to reduce the risk of such cybersecurity incidents but does not guarantee full protection against potential threats or cyberattacks or a risk-free environment. This is especially applicable in the current global environment, with the war in Ukraine and the conflict in the Middle East resulting in an increased risk of cyber-attacks, and other disruptions in response to, or retaliation for, the sanctions and costs imposed on Russia and certain other countries directly or indirectly involved in the wars. Additionally, the shift to remote work policies for a significant portion of our workforce, as they access our secure systems and networks remotely, and our customers’ increased reliance on digital banking products and other digital services, including mobile payment products, has also increased the risk of cyber-attacks.

 

12

 

 

While we generally perform cybersecurity due diligence on our key vendors, because we do not control our vendors and our ability to monitor their cybersecurity is limited, we cannot ensure the cybersecurity measures they take will be sufficient to protect any information we share with them. Due to applicable laws and regulations or contractual obligations, we may be held responsible for security breaches, cyber-attacks or other similar incidents attributed to our vendors as they relate to the information we share with them.

 

In addition, we may also be impacted by cyber-attacks against national critical infrastructures of Chile, such as telecommunications networks. Our information technology systems are dependent on such critical infrastructure and any cyber-attack against such critical infrastructure could negatively affect our ability to service our customers. As we do not operate such critical infrastructure, we have limited ability to protect our information technology systems from the adverse effects of a cyber-attack. For further information, see “Item 11. Quantitative and Qualitative Disclosures about Market Risk—2. Non-financial risks—Cyber-security and data security plans.”

 

We have seen in recent years the information technology systems and networks of companies and organizations being increasingly targeted, and the techniques used to obtain unauthorized, improper or illegal access to such information technology and systems and networks have become increasingly complex and sophisticated, including through the use of AI. Furthermore, such techniques change frequently and are often not recognized or detected until after they have been launched and can originate from a wide variety of sources, including organized crime, hackers, activists, terrorists, nation-states, nation state-supported actors and others, any of which may see their effectiveness enhanced by the use of AI. As attempted attacks continue to evolve in scope and sophistication, we may incur significant costs in order to modify or enhance our protective measures against such attacks, or to investigate or remediate any vulnerability or resulting breach, or in communicating cyber-attacks or other security incidents to our customers, affected individuals or regulators, as applicable.

 

If we cannot maintain effective and secure proprietary, confidential, sensitive and personal data, or if we or our third-party vendors fall victim to successful cyber-attacks, penetrations, compromises, breaches or circumventions of our information technology systems or networks or experience other security incidents in the future, we may incur substantial costs and suffer other negative consequences, such as disruption to our operations, misappropriation of personal, proprietary, confidential or sensitive information, remediation costs (including liabilities for stolen assets or information, repairs of system damage, among others), increased cybersecurity protection costs, lost revenues arising from the unauthorized use of personal, proprietary, confidential or sensitive information or the failure to retain or attract our customers following a cybersecurity incident, litigation and legal risks (including claims from customers, employees or other third parties, regulatory action, reporting obligations, investigation, fines and penalties), increased insurance premiums, reputational damage affecting our customers’ and the investors’ confidence, as well as damages to our competitiveness, stock price and long-term shareholder value. In addition, our remediation efforts may not be successful, and we may not have adequate insurance to cover these losses. While we maintain insurance coverage, we cannot assure you that such coverage will be adequate or otherwise protect us from liabilities or damages with respect to claims alleging compromises of proprietary, confidential, sensitive or personal data or otherwise relating to data privacy and cybersecurity matters. In addition, we cannot be sure that our existing insurance coverage will continue to be available on acceptable terms or at all, or that our insurers will not deny coverage to any future claim. Moreover, even when a failure of or interruption in our or our third-party vendors’ systems or facilities is resolved in a timely manner or an attempted cyber-attack, data breach or security incident is successfully avoided or thwarted, substantial resources and management attention are expended in doing so, and to successfully avoid or resolve any such incidents, we may be required to take actions that could adversely affect customer satisfaction or retention, as well as harm our reputation.

 

Any of the data breaches and other security incidents described above could have a material adverse effect on our business, financial condition and results of operations.

 

Users and credit card issuers such as us also have obligations when a client’s cards and/or online payment or transfer user information are lost, stolen or fraudulently used (including through hacking and cloning). Cardholders are obligated to notify the bank through an easily accessible channel when their cards have been lost, stolen, or fraudulently used. For those transactions realized prior to the notice of loss or theft of a credit card, the cardholder must also notify the issuer of all of the unauthorized transactions in the same notice or up to five business days following the original notification. In cases of fraud, the user will not be responsible for the transactions that they did not authorize, and which were made prior to the fraud notification within the 30 calendar days following the issuance of said notice. In these cases, issuers are responsible for assuming these costs or must demonstrate that the transaction was in fact authorized by the owner or user of the credit card. The law also considers increasing fines and jail time for those committing theft or fraud with credit cards, which must be legally pursued by the card issuer.

 

13

 

 

In light of these developments, we are trying to limit the exposure of our clients to credit card fraud through education, insurance coverage, marketing campaigns, daily transfer amount limits, chip technology, improved ATM software, and other technological improvements, but we cannot assure that this law will not increase the financial costs related to cybercrime and credit card fraud.

 

We utilize artificial intelligence, which could expose us to liability or adversely affect our business.

 

We utilize, and are continuing to explore further uses of, AI in connection with our business, products and services. However, there are significant risks involved in utilizing AI and no assurance can be provided that our use will enhance our products or services or produce the intended results. For example, AI algorithms may be flawed, insufficient, of poor quality, reflect unwanted forms of bias or contain other errors or inadequacies, any of which may not be easily detectable, AI has been known to produce false inferences or outputs, AI may subject us to new or heightened legal, regulatory, ethical or other challenges, AI may involve inappropriate or controversial data practices by developers and end-users, or other factors adversely affecting public opinion of AI, which could impair the acceptance of AI solutions, including those incorporated into our products and services. If the AI solutions that we create or use are deficient, inaccurate or controversial, we could incur operational inefficiencies, competitive harm, legal liability, brand or reputational harm, or other adverse impacts on our business and financial results. Additionally, if any of our employees, contractors, vendors or service providers use any third-party AI-powered solutions in connection with our business, it may lead to the inadvertent public disclosure of our proprietary, confidential, sensitive or personal information which may impact our ability to realize the benefit of our intellectual property or proprietary, confidential, sensitive or personal information, harming our competitive position and business. If we do not have sufficient rights to use the data or other material or content on which our AI solutions or other AI tools we use rely, we also may incur liability through the violation of applicable laws and regulations, third-party intellectual property, privacy or other rights, or contracts to which we are a party.

 

We rely on third parties and affiliates for important products and services.

 

Third party vendors and certain affiliated companies provide key components of our business infrastructure such as loan and deposit servicing systems, back office and business process support, information technology production and support, Internet connections and network access. Relying on these third parties and affiliated companies can be a source of operational and regulatory risk to us, including with respect to security breaches affecting such parties. We are also subject to risk with respect to security breaches affecting the vendors and other parties that interact with these service providers. As our interconnectivity with these third parties and affiliated companies increases, we increasingly face the risk of operational failure with respect to their systems. We may be required to take steps to protect the integrity of our operational systems, thereby increasing our operational costs and potentially decreasing customer satisfaction.

 

In addition, any problems caused by these third parties or affiliated companies, including as a result of them not providing us their services for any reason, or performing their services poorly, could adversely affect our ability to deliver products and services to customers and otherwise conduct our business, which could lead to reputational damage and regulatory investigations and intervention. Replacing these third-party vendors could also entail significant delays and expense. Further, the operational and regulatory risk we face as a result of these arrangements may be increased to the extent that we restructure such arrangements. Any restructuring could involve significant expense to us and entail significant delivery and execution risks, which could have a material adverse effect on our business, operations and financial condition.

 

Damage to our reputation could cause harm to our business prospects.

 

Maintaining a robust risk management framework based on robust ethical principles and corporate values is critical to protect our reputation and our brand, attract and retain customers, investors and employees and conduct business transactions with counterparties. Damage to our reputation could materially and adversely affect our perception among current and potential clients, investors, vendors, partners, regulators and other third parties, which in turn could have a material adverse effect on our operating results, financial condition, and prospects as well as damage our customers’ and investors’ confidence and the market price of our securities. Harm to our reputation could arise from numerous sources, including, among others, employee misconduct, including the possibility of fraud perpetrated by our employees, litigation or regulatory enforcement, failure to deliver minimum standards of service and quality, negative perceptions regarding our ability to maintain the security of our technology systems and protect customer data (including as a result of a cybersecurity incident), dealing with sectors that are not well perceived by the public (weapons industries or embargoed countries, for example), dealing with customers in sanctions lists, rating downgrades, significant variations in our share price throughout the year, compliance failures, unethical behavior, actual or alleged conduct in any number of activities, including lending practices, sales and marketing, corporate governance and corporate culture, and the activities of customers and counterparties, including activities that negatively affect the environment. Our reputation could also suffer if we are the subject of negative coverage in the media, whether it has merit or not.

 

14

 

 

Actions by the financial services industry generally or by certain members of, or individuals in, the industry can also affect our reputation. For example, the role played by financial services firms in the financial crisis and the seeming shift toward increasing regulatory supervision and enforcement has caused public perception of us and others in the financial services industry to decline.

 

Additionally, we could suffer significant reputational harm that could affect our business, results of operations and prospects from any negative perceptions regarding topics related to environmental, social and corporate governance policies. There has been increased focus by customers, shareholders, investor advocacy groups, employees, regulators and other stakeholders on these topics, and our policies, practices and disclosures in these areas could come under scrutiny. Governments may implement new or additional regulations and standards, or investors, customers and other stakeholders may impose new expectations or focus investments in ways that cause significant shifts in disclosure, consumption and behaviors that may have negative impacts on our business. If regulators or stakeholders consider our efforts to be ineffective, inadequate or unsatisfactory, whether real or perceived, it could harm our reputation, business and prospects and we could be subject to enforcement, other supervisory actions or other harm.

 

We could also suffer significant reputational harm if we fail to identify and manage potential conflicts of interest properly. The failure, or perceived failure, to adequately address conflicts of interest could affect the willingness of clients to deal with us or give rise to litigation or enforcement actions against us which could have an adverse effect on our operating results, financial condition and prospects.

 

We may be the subject of misinformation and misrepresentations deliberately propagated to harm our reputation or for other deceitful purposes, or by profiteering short sellers seeking to gain an illegal market advantage by spreading false information about us. There can be no assurance that we will effectively neutralize and contain a false information that may be propagated regarding the business, which could have an adverse effect on our operating results, financial condition and prospects.

 

Financial Risks

 

Credit, market and liquidity risk may have an adverse effect on our credit ratings and our cost of funds. Any downgrade in Chile’s, our controlling shareholders or our credit rating would likely increase our cost of funding, require us to post additional collateral or take other actions under some of our derivative and other contracts and adversely affect our interest margins and results of operations.

 

Credit ratings affect the cost and other terms upon which we can obtain funding. Rating agencies regularly evaluate us, and their ratings of our debt are based on several factors, including our financial strength and conditions affecting the financial services industry. In addition, due to the methodology of the main rating agencies, our credit rating is affected by the rating of Chile’s sovereign debt. If Chile’s sovereign debt is downgraded, our credit rating would also likely be downgraded by an equivalent amount. In addition, our ratings may be adversely affected by any downgrade in the ratings of our parent company, Santander Spain.

 

In September 2022, Moody’s downgraded the Republic of Chile and, as a direct effect of such downgrade, Santander Chile’s credit ratings to A2 with a stable outlook. On October 19, 2023, Standard and Poor’s changed its outlook for the Republic of Chile from positive to negative while it maintained its A rating. These downgrades were driven by fiscal and economic trends that have gradually but persistently weakened Chile’s sovereign credit profile.

 

Downgrades in our debt credit ratings have in the past, and would likely in the future, increase our borrowing costs and require us to post additional collateral or take other actions under some of our derivative and other contracts, and could limit our access to capital markets and adversely affect our commercial business. For example, a ratings downgrade could adversely affect our ability to sell or market some of our products, engage in certain longer-term and derivatives transactions and retain our customers, particularly customers who need a minimum rating threshold in order to invest. In addition, under the terms of certain of our derivative contracts and other financial commitments, we may be required to maintain a minimum credit rating or terminate such contracts or require the posting of collateral. Any of these results of a ratings downgrade could reduce our liquidity and have an adverse effect on us, including our operating results and financial condition.

 

15

 

 

While certain potential impacts of these downgrades are contractual and quantifiable, the full consequences of a credit rating downgrade are inherently uncertain, as they depend on numerous dynamic, complex and inter-related factors and assumptions, including market conditions at the time of any downgrade, whether any downgrade of our long-term credit rating precipitates downgrades to our short-term credit rating, and assumptions about the potential behaviors of various customers, investors and counterparties. Actual outflows could be higher or lower than the preceding hypothetical examples, depending upon certain factors including which credit rating agency downgrades our credit rating, any management or restructuring actions that could be taken to reduce cash outflows and the potential liquidity impact from loss of unsecured funding (such as from money market funds) or loss of secured funding capacity. Although unsecured and secured funding stresses are included in our stress testing scenarios and a portion of our total liquid assets is held against these risks, a credit rating downgrade could still have a material adverse effect on us.

 

In addition, if we were required to cancel our derivatives contracts with certain counterparties and were unable to replace such contracts, our market risk profile could be altered.

 

There can be no assurance that the rating agencies will maintain the current ratings or outlooks. In general, the future evolution of our ratings will be linked, to a large extent, to the general global macroeconomic outlook which includes the impact of the continuance or escalation of the war in Ukraine and of the conflict in the Middle East, the local macroeconomic outlook, the evolution of Chile’s political environment, especially in relation to potential projects to amend Chile’s constitution, the Chilean government’s fiscal policy and the outlook of our asset quality, profitability and capital. Failure to maintain favorable ratings and outlooks could increase our cost of funding and adversely affect interest margins, which could have a material adverse effect on us.

 

Market conditions have resulted and could result in material changes to the estimated fair values of our financial assets. Negative fair value adjustments could have a material adverse effect on our operating results, financial condition and prospects.

 

In the past, financial markets have been subject to significant stress resulting in steep falls in perceived or actual financial asset values, particularly due to volatility in global financial markets and the resulting widening of credit spreads, including as a result of local political issues, a higher interest rate environment, the war in Ukraine, the conflict in the Middle East and the COVID-19 pandemic. We have material exposures to securities, loans and other investments that are recorded at fair value and are therefore exposed to potential negative fair value adjustments. Asset valuations in future periods, reflecting then-prevailing market conditions, may result in negative changes in the fair values of our financial assets and these may also translate into increased impairments. In addition, the value ultimately realized by us on disposal may be lower than the current fair value. Any of these factors could require us to record negative fair value adjustments, which may have a material adverse effect on our operating results, financial condition or prospects.

 

In 2021, pension fund withdrawals, the acceleration of inflation on a global scale and political uncertainty in Chile led to significant rate increases along the entire yield curve. Furthermore, the Central Bank increased the monetary policy rate (“MPR”) from 0.5% to 4.0% in December 2021 and to 11.25% in December 2022. In 2023, the Central Bank loosened its monetary policy, but rates remained above recent historical averages. The MPR as of December 31, 2023 was 8.25%. This has negatively impacted the fair value of various financial assets, including our debt instruments at fair value through other comprehensive income. As of December 31, 2023, these instruments include balances of unrealized net loss of Ch$89,748 million recognized as “Valuation accounts” in equity.

 

In addition, to the extent that fair values are determined using financial valuation models, such values may be inaccurate or subject to change, as the data used by such models may not be available or may become unavailable due to changes in market conditions, particularly for illiquid assets, and particularly in times of economic instability. In such circumstances, our valuation methodologies require us to make assumptions, judgements and estimates in order to establish fair value, and reliable assumptions are difficult to make and are inherently uncertain and valuation models are complex, making them inherently imperfect predictors of actual results. Any consequential impairments or write-downs could have a material adverse effect on our operating results, financial condition and prospects.

 

16

 

 

The value of the collateral securing our loans may not be sufficient, and we may be unable to realize the full value of the collateral securing our loan portfolio.

 

The value of the collateral securing our loan portfolio may fluctuate or decline due to factors beyond our control, including macroeconomic or political factors affecting Chile’s economy, the continuance or escalation of the war in Ukraine and the conflict in the Middle East. The value of the collateral securing our loan portfolio may be adversely affected by force majeure events, such as natural disasters (including as a result of climate change), particularly in locations where a significant portion of our loan portfolio is composed of real estate loans. Natural disasters such as earthquakes and floods may cause widespread damage, which could impair the asset quality of our loan portfolio and could have an adverse impact on Chile’s economy. The real estate market is particularly vulnerable in the current economic climate and this may affect us, as real estate represents a significant portion of the collateral securing our residential mortgage loan portfolio. We may also not have sufficiently recent information on the value of collateral, which may result in an inaccurate assessment for impairment losses of our loans secured by such collateral. If any of the above were to occur, we may need to make additional provisions to cover actual impairment losses of our loans, which may materially and adversely affect our results of operations and financial condition.

 

In addition, auto industry technology changes, accelerated by environmental rules, could affect our auto consumer business in Chile, particularly residual values of leased vehicles. This transformation could affect our auto finance business in view of (i) a transition from fuel to electric engines, environmental aspects related to emissions and transition risks derived from political and regulatory decisions (e.g., traffic restrictions in city centres for certain cars based on emissions criteria); (ii) growing customer preferences for car leasing, subscription, car sharing and other services instead of vehicle ownership; (iii) greater market concentration in certain manufacturers, distributors and other agents; and (iv) more online sales channels. In addition, the auto industry could also suffer from supply chain disruption and shortages of batteries, semi-conductors and others in the wake of the wars, geopolitical and macroeconomic tensions, conflicts and other events, affecting guarantees, residual used car value and loan delinquencies. Although we monitor the auto portfolios and dealers and we have launched specific plans to tackle particular issues, the auto industry changes and disruptions described above could have a material adverse effect on our operating results, financial condition and prospects.

 

As of December 31, 2023, 63.2% of our loans and advances to customers, including contingent loan exposure are collateralized, which includes 10.5% of our consumer loans, 97.2% of our mortgage loans and 54.7% of our commercial loans.

 

The credit quality of our loan portfolio may deteriorate, and our loan loss reserves could be insufficient to cover our loan losses, which could have a material adverse effect on us.

 

Risks arising from changes in credit quality and the recoverability of loans and amounts due from counterparties are inherent to a wide range of our businesses. Non-performing or low credit quality loans have in the past negatively impacted our results of operations and could do so in the future. In particular, the amount of our reported credit impaired loans may increase in the future as a result of growth in our total loan portfolio, including as a result of loan portfolios that we may acquire in the future (the credit quality of which may turn out to be worse than we had anticipated), or factors beyond our control, such as adverse changes in the credit quality of our borrowers and counterparties or a general deterioration in economic conditions in Chile or in global economic and political conditions, including as a result of inflationary pressures, supply chain issues, labor shortages and increases in commodity prices (including as a result of the continuance or escalation of the war in Ukraine and the conflict in the Middle East). In certain markets, the combined pressure of economic downturn, high inflation and high interest rates may impact the ability of our customers to repay their debt. If we are unable to control the level of our credit impaired or poor credit quality loans, this could have a material adverse effect on us.

 

As of December 31, 2023, our non-performing loans were Ch$923,852 million, and the ratio of our non-performing loans to total loans at amortized cost was 2.26%. As of December 31, 2023, our allowance for expected credit losses for loans classified as financial assets at amortized costs was Ch$1,149,991 million, and the ratio of these allowances for expected loan losses to total loans at amortized cost was 2.82%. For additional information on our asset quality, see “Item 5. Operating and Financial Review and Prospects—C. Selected Statistical Information—Analysis and Classification of Loan Portfolio Based on the Borrower’s Payment Performance.”

 

17

 

 

Our loan loss reserves are based on our current assessment of and expectations concerning various factors affecting the quality of our loan portfolio. These factors include, among other things, our borrowers’ financial condition, repayment abilities and repayment intentions, the realizable value of any collateral, the prospects for support from any guarantor, Chile’s economy, government macroeconomic policies, interest rates and the legal and regulatory environment. Because many of these factors are beyond our control and there is no infallible method for predicting loan and credit losses, we cannot assure you that our current or future loan loss and reserves will be sufficient to cover actual losses. If our assessment of and expectations concerning the above-mentioned factors differ from actual developments, if the quality of our total loan portfolio deteriorates, for any reason, or if the future actual losses exceed our estimates of expected losses, we may be required to increase our loan loss reserves, which may adversely affect us. Additionally, in calculating our loan loss reserves, we employ qualitative tools and statistical models which may not be reliable in all circumstances and which are dependent upon data that may not be complete.

 

Our financial results are constantly exposed to market risk. We are subject to fluctuations in interest rates and other market risks, which may materially and adversely affect us and our profitability.

 

Our financial results are constantly exposed to market risk. In 2022 and 2023, the high interest rate environment, lingering inflationary pressures, global events (such as the continuance or escalation of the war in Ukraine and of the conflict in the Middle East) and the banking crisis that shocked regional banks in the U.S. have caused and could continue to cause high market volatility, which could materially and adversely affect us and our trading and banking book.

 

Economic activities exposed to market risk include (i) transactions where risk is assumed as a consequence of potential changes in interest rates, inflation rates, exchange rates, stock prices, credit spreads, commodity prices, volatility and other market factors; (ii) the liquidity risk from our products and markets; and (iii) the balance sheet liquidity risk.

 

As described below, market risk affects (i) our interest income / (charges); (ii) the market value of our assets and liabilities, in particular of our securities holdings, loans and deposits and derivatives transactions; and (iii) other areas of our business such as the volume of loans originated or credit spreads.

 

The performance of financial markets may cause changes in the value of our investment and trading portfolios. The volatility of world equity markets due to the continued economic uncertainty and sovereign debt crisis has had a particularly strong impact on the financial sector. Continued volatility may affect the value of our investments in equity securities and, depending on their fair value and future recovery expectations, could become a permanent impairment which would be subject to write-offs against our results.

 

Market risk could include unexpected or unpredictable risks related to periods in which the market does not calculate prices efficiently (for example, during market interruptions or shocks).

 

Interest rates are sensitive to many factors beyond our control, including increased regulation of the financial sector, the reserve policies of the Central Bank, deregulation of the financial sector in Chile, monetary policies and domestic and international economic and political conditions. Variations in interest rates could affect the interest earned on our assets and the interest paid on our borrowings, thereby affecting our interest income / (charges), which comprises the majority of our revenue, reducing our growth rate and potentially resulting in losses. In addition, costs we incur as we implement strategies to reduce interest rate exposure could increase in the future, which, in turn, will impact our results.

 

Increases in interest rates may reduce the volume of loans we originate. Sustained high interest rates have historically discouraged customers from borrowing and have resulted in increases or fluctuations in delinquencies in outstanding loans and deterioration in the quality of assets. Increases in interest rates may reduce the value of our financial assets and may reduce gains or require us to record losses on sales of our loans or securities. Additionally, a shrinking yield premium between short-term and long-term market interest rates, coupled with inflation, could adversely affect our business and results of operations.

 

While it would likely decrease funding costs, if interest rates decrease then the income we receive from our investments in securities and loans with similar maturities could be adversely affected. In addition, we may also experience increased delinquencies in a low interest rate environment when such an environment is accompanied by high unemployment and recessionary conditions. “See Item 11. Quantitative and Qualitative Disclosure About Market Risks—Market Risk: Quantitative Disclosure—Impact of Interest Rates.”

 

18

 

 

The market value of a security with a fixed interest rate generally decreases when the prevailing interest rates rise, which may have an adverse effect on our earnings and financial condition. In addition, we may incur costs as we implement strategies to reduce interest rate exposure in the future (which, in turn, will impact our results). The market value of an obligation with a floating interest rate can be adversely affected when interest rates increase, due to a lag in the implementation of repricing terms or an inability to refinance at lower rates.

 

High levels of inflation in Chile could adversely affect the Chilean economy and our business, financial condition and results of operations (see risk factor—“Inflation, government efforts to control inflation, and changes in interest rates may hinder the growth of the Chilean economy and could have an adverse effect on us.”). Any change in the methodology of how the CPI index or the UF are calculated could also adversely affect our business, financial condition and results of operations. Extended periods of deflation could also have an adverse effect on our business, financial condition and results of operations. The UF is revalued in monthly cycles. On each day in the period beginning on the tenth day of any given 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. For more information regarding the UF, see “Item 5. Operating and Financial Review and Prospects—A. Operating Results—Impact of Inflation.” Although we benefit from inflation in Chile due to the current structure of our assets and liabilities (i.e., a significant portion of our loans are indexed to the inflation rate, but there are no corresponding features in deposits, or other funding sources that would increase the size of our funding base), 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, including from extended periods of inflation that adversely affect economic growth or periods of deflation. “See Item 11. Quantitative and Qualitative Disclosure About Market Risks—Market Risk: Quantitative Disclosure—Impact of Inflation.”

 

We are also exposed to foreign exchange rate risk as a result of mismatches between assets and liabilities denominated in different currencies. Fluctuations in the exchange rate between currencies may negatively affect our earnings and value of our assets and securities. Therefore, while the Bank seeks to avoid significant mismatches between assets and liabilities due to foreign currency exposure, from time to time, we may have mismatches. The Chilean peso has been subject to large devaluations and appreciations in the past and could be subject to significant fluctuations in the future. Our results of operations may be affected by fluctuations in the exchange rates between the peso and the dollar despite our policy and Chilean regulations relating to the general avoidance of material exchange rate exposure. In order to avoid material exchange rate exposure, we enter into forward exchange transactions. We may decide to change our policy regarding exchange rate exposure. Regulations that limit such exposures may also be amended or eliminated. Greater exchange rate risk will increase our exposure to the devaluation of the peso, and any such devaluation may impair our capacity to service foreign currency obligations and may, therefore, materially and adversely affect our financial condition and results of operations. Notwithstanding the existence of general policies and regulations that limit material exchange rate exposures, the economic policies of the Chilean government, new foreign currency regulations by the Central Bank and any future fluctuations of the peso against the dollar could affect our financial condition and results of operations. “See Item 11. Quantitative and Qualitative Disclosure About Market Risks—Market Risk: Quantitative Disclosure—Foreign exchange fluctuations.”

 

If any of these risks were to materialize, our interest income or the market value of our assets and liabilities could suffer a material adverse impact.

 

We are subject to market, operational and other related risks associated with our derivative transactions that could have a material adverse effect on us.

 

We enter into derivative transactions for trading purposes as well as for hedging purposes. We are subject to market, credit and operational risks associated with these transactions, including basis risk (the risk of loss associated with variations in the spread between the asset yield and the funding and/or hedge cost) and credit or default risk (the risk of insolvency or other inability of the counterparty to a particular transaction to perform its obligations thereunder, including providing sufficient collateral).

 

Market practices and documentation for derivative transactions in Chile may differ from those in other countries. For example, documentation may not incorporate terms and conditions of derivatives transactions as commonly understood in other countries. In addition, the execution and performance of these transactions depend on our ability to maintain adequate control and administration systems. Moreover, our ability to adequately monitor, analyze and report derivative transactions continues to depend, largely, on our information technology systems. These factors further increase the risks associated with these transactions and could have a material adverse effect on us.

 

19

 

 

As of December 31, 2023, the fair value of the trading derivatives in our assets amounted to Ch$10,119,486 million with a notional value of Ch$263,509,283 million. Additionally, as of December 31, 2023, the fair value of trading derivatives in our liabilities totaled Ch$9,521,575 million with a notional value of Ch$269,896,699 million.

 

As of December 31, 2023, the nominal value of the hedging derivatives in our books within our financial risk management strategy and with the aim of reducing asymmetries in the accounting treatment of our operations amounted to Ch$35,784,423 million (with market value of Ch$605,529 million in assets and Ch$2,466,767 million in liabilities).

 

We are subject to counterparty risk in our banking business.

 

We are exposed to counterparty risk in addition to credit risks associated with lending activities. Counterparty risk may arise from, for example, investing in securities of third parties, entering into derivative contracts under which counterparties have obligations to make payments to us or executing securities, futures, currency or commodity trades from proprietary trading activities that fail to settle at the required time due to non-delivery by the counterparty or systems failure by clearing agents, clearing houses or other financial intermediaries.

 

We routinely transact with counterparties in the financial services industry, including brokers and dealers, commercial banks, investment banks, mutual funds, hedge funds and other institutional clients. Defaults by, and even rumors or questions about the solvency of, certain financial institutions and the financial services industry generally have led to market-wide liquidity problems and could lead to losses or defaults by other institutions. Many of the routine transactions we enter into expose us to significant credit risk in the event of default by one of our significant counterparties.

 

Liquidity and funding risks are inherent in our business and could have a material adverse effect on us.

 

Liquidity risk is the risk that we either do not have sufficient financial resources available to meet our obligations as they are due, or we can only secure them at excessive cost. This risk is inherent in any banking business and can be heightened by a number of enterprise-specific factors, including over-reliance on a particular source of funding, changes in credit ratings or market-wide phenomena such as market dislocation, including as a result of the continuance or escalation of the war in Ukraine and the conflict in the Middle East. While we have in place liquidity management processes to mitigate and control these risks, systemic market factors make it difficult to eliminate these risks completely. Constraints in the supply of liquidity, including in inter-bank lending, could materially and adversely affect the cost of funding of our business, and extreme liquidity constraints may affect our current operations and our ability to fulfill regulatory liquidity requirements, as well as limit growth possibilities.

 

Our cost of obtaining funding is directly related to prevailing interest rates and to our credit spreads. The high interest rate environment currently prevalent in Chile and globally significantly increased the cost of our funding. Credit spreads variations are market-driven and may be influenced by market perceptions of our creditworthiness. Changes to interest rates and our credit spreads may occur frequently and could be unpredictable and highly volatile.

 

We rely, and will continue to rely, primarily on retail deposits to fund lending activities. The ongoing availability of this type of funding is sensitive to a variety of factors beyond our control, such as general economic conditions and the confidence of retail depositors in the economy and in the financial services industry, and the availability and extent of deposit guarantees, as well as competition for deposits between banks or with other products, such as mutual funds. Any of these factors could increase the amount of retail deposit withdrawals in a short period of time, thereby reducing our ability to access retail deposit funding on appropriate terms, or at all, in the future. If these circumstances were to arise, this could have a material adverse effect on our operating results, financial condition and prospects.

 

In the first half of 2023, the liquidity issues faced by Silicon Valley Bank and other banks in the United States, and the issues faced by the Swiss bank Credit Suisse, caused withdrawals of deposits from these banks and volatility in international markets. Central banks took measures designed to guarantee the liquidity of the banking system. Although we did not have material exposure to the affected banks, the spread or potential spread of these or other issues to the broader financial sector could have a material adverse effect on our operating results, financial condition and prospects.

 

20

 

 

We anticipate that our customers will continue, in the near future, to make short-term deposits (particularly demand deposits and short-term time deposits), and we intend to maintain our emphasis on the use of banking deposits as a source of funds. As of December 31, 2023, 99.4% of our customer deposits had remaining maturities of one year or less or were payable on demand. A significant portion of our assets have longer maturities, resulting in a mismatch between the maturities of liabilities and the maturities of assets. Historically, one of our principal sources of funds has been time deposits. Time deposits represented 22.7% and 19.0% of our total liabilities and equity as of December 31, 2023 and 2022, respectively. The Chilean time deposit market is concentrated given the importance in size of various large institutional investors such as pension funds and corporations relative to the total size of the economy. As of December 31, 2023, the Bank’s top 20 time deposits represented 33.0% of total time deposits, or 7.5% of total liabilities and equity. No assurance can be given that future economic instability in the Chilean market will not negatively affect our ability to continue funding our business or to maintain our current levels of funding without incurring increased funding costs, a reduction in the term of funding instruments or the liquidation of certain assets. If this were to happen, we could be materially adversely affected.

 

The short-term nature of this funding source could cause liquidity problems for us in the future if deposits are not made in the volumes we expect or are not renewed. If a substantial number of our depositors withdraw their demand deposits or do not roll over their time deposits upon maturity, we may be materially and adversely affected.

 

Central banks took extraordinary measures to increase liquidity in the financial markets as a response to the COVID-19 pandemic and the regional banking crisis in the U.S. If these facilities, which are progressively being reduced, were to be rapidly removed, this could have an adverse effect on our ability to access liquidity and on our funding costs.

 

In response to the COVID-19 pandemic, the Central Bank made available two lines of credit to banks to reinforce their liquidity. Pursuant to these lines of credit, a bank may borrow up to 3% of the aggregate amount of its consumer and commercial loan portfolios as of February 29, 2020 and may borrow up to an additional 12% if it uses the funds to provide loans to companies and individuals. The first line of credit is a facility available conditionally on loan growth (the “FCIC”) to ensure that banks continue to finance households and businesses in Chile. Loans provided by this line of credit may have maturities of up to four years and must be secured by government bonds, corporate bonds or highly rated large commercial loans as collateral. In stages 1 and 2, the Board of the Central Bank had allocated a total of U.S.$40 billion to this facility, of which approximately U.S.$30 billion was disbursed. The Central Bank in its Monetary Policy Meeting held on January 27, 2021 announced the beginning of a third stage of this instrument (FCIC3) commencing on March 1, 2021 for approximately U.S.$10 billion. The FCIC instruments bear interest at 0.5% (the lowest Central Bank MPR) for the duration of the program. Loans provided under the second line of credit, the LCL, are unsecured and may have maturities of up to 2 years, bearing interest in accordance with the current Central Bank MPR. In addition, borrowings by a bank under the LCL are limited to the aggregate amount of the liquidity reserve requirements of such bank. Ultimately, these lines of credit are intended to ensure banks have ample liquidity to enable them to continue financing companies and individuals. As of December 31, 2023, we had borrowed Ch$6,181,998 million (U.S.$7.1 billion) under the FCIC programs and had no debt outstanding under the LCL.

 

Our obligation to the Central Bank under the FCIC program is due during 2024. With the purpose of managing an orderly process of the expiration of the FCIC, in November 2022 the Central Bank established a collateral replacement program with the goal of reducing the pledged credit portfolio by replacing it with eligible Central Bank instruments at a rate of 1/18 per month. Additionally, with the same objective, the Central Bank agreed to implement a program for issuing Liquidity Deposits (LD) aimed exclusively at guaranteeing and providing operational support for the payment of the FCIC. These instruments will be issued at floating MPR with the same payment dates of the various FCIC facilities. As of December 31, 2023, the Bank has invested Ch$3,392,609 million in this type of instrument, which we classify as financial investments at amortized cost.

 

Additionally, our activities could be adversely impacted by liquidity tensions arising from generalized drawdowns of committed credit lines to our customers.

 

We cannot assure that in the event of a sudden or unexpected shortage of funds in the banking system, we will be able to maintain levels of funding without incurring high funding costs, a reduction in the term of funding instruments or the liquidation of certain assets. If this were to happen, we could be materially adversely affected.

 

21

 

 

Changes to the pension fund system may affect our liquidity levels and/or funding costs

 

The current pension fund system dates from the 1980s when pensions went from being state-funded to privately-funded, which requires Chilean employees to set aside 10% of their wages. As of September 30, 2023, the most recent date as of which information is available, the Chilean pension fund management companies (Administradora de Fondos de Pensión, or “AFPs”) had U.S.$3.4 billion invested in the Bank via equity, deposits and fixed income. The demographics of Chilean society have changed, resulting in a need to modify the system. In December 2023, the Chilean government once again presented a new bill for pension reform to Congress, as previous bills proposed by the government failed to gain congressional support. The proposed bill would create a mixed pension system, maintain the individual capitalization system and complement it with a contributory pillar with a social security logic. It imposes a 6% additional contribution charged to employers to be allocated to social security in addition to the current 10% contribution, with ample discussion between the Executive and Congress about which institutions will manage these additional contributions to the pension system and whether the contributions will be assigned to each worker’s individual account or to a common fund. The potential adverse effect, if any, of the proposed bill on our financial condition and results of operations cannot yet be ascertained.

 

Chilean regulations also impose a series of restrictions on how Chilean AFPs may allocate their assets. In the particular case of financial issuers’ there are three restrictions, each involving different assets and different limits determined by the amount of assets in each fund and the market and book value of the issuer’s equity. As a consequence, limits vary within funds of AFPs and issuers. According to our estimates, as of September 2023, the most recent date as of which information is available, the AFPs still had the possibility of being able to invest another U.S.$7.7 billion in the Bank via equity, deposits and fixed income. If the exposure of any AFP to Santander-Chile exceeds the regulatory limits, if the regulatory limits are reduced or the amount of funds available in the pension funds falls significantly, we would need to seek alternative sources of funding, which could be more expensive and, as a consequence, may have a material adverse effect on our financial condition and results of operations.

 

In July 2020, a law was passed permitting Chileans to withdraw a minimum of UF35 (U.S.$1,472) and a maximum of UF150 (U.S.$6,311) from their pension funds. For those that had funds below UF35, they were able to withdraw the total amount of their savings. The draw down was tax-free and approximately U.S.$19.7 billion were withdrawn. In December 2020, a second pension fund withdrawal was approved, although withdrawals under this approval were not tax-exempt. This added another U.S.$16.0 billion in liquidity to the system. On April 27, 2021, a third withdrawal was approved and added a further U.S.$13.3 billion of liquidity into the system. Withdrawals had an immediate impact on local fixed income capital markets and between December 31, 2020 and December 31, 2021, the yield on Chile’s 10-year Central Bank nominal bond increased from 2.6% to 5.7%, reaching a peak at 7.00% on September 28, 2022. The withdrawals were also a major contributing factor to the rise of inflation which reached 12.8% in 2022 and 3.9% in 2023. In 2023, there were no additional pension fund withdrawals, but given the higher interest rates resulting from a shift in monetary policy during the year and high levels of liquidity in households from prior withdrawals, the 10-year Central Bank nominal bond yield averaged 5.60%, which is well above pre-pandemic levels. No assurances can be made as to whether there will be additional withdrawals in the future or whether the withdrawals will have a material adverse effect on our financial condition, liquidity levels, and our ability to obtain funding from the AFPs.

 

Legal and Regulatory Risks

 

We are subject to regulatory capital requirements that could limit our operations, and changes to these requirements may further limit and adversely affect our operating results, financial condition and prospects.

 

On October 9, 2020, the FMC published the final regulations on regulatory capital to comply with effective net worth rules in accordance with Basel III and the General Banking Law. The new regulation became effective on December 1, 2021 and are being gradually implemented and adjusted to be fully effective by December 1, 2025. Pursuant to the new regulation, there are three levels of capital: ordinary capital level 1 or CET1 (basic capital), additional capital level 1 or AT1 (perpetual bonds and preferred stock) and capital level 2 or T2 (subordinated bonds and voluntary provisions). Regulatory capital is composed of the sum of CET1, AT1 and T2 after making some deductions, mainly for intangible assets, hybrid securities issued by foreign subsidiaries, partial deduction for deferred taxes and some reserve and profit accounts. The minimum total regulatory capital is 8% of risk-weighted assets, which includes credit, market, and operational risk. This minimum goes up in line with the size, complexity and solvency of a bank and the FMC’s assessment of a bank’s management. In addition, and to avoid restrictions on dividend payments, a bank must have an additional conservation buffer of 2.5% of RWA. The conservation buffer will be gradually phased in by 2025 and must be comprised of core capital.

 

22

 

 

The Central Bank may set an additional counter cyclical buffer of up to 2.5% of risk-weighted assets in agreement with the FMC, also comprised of core capital. At the Central Bank’s Financial Policy Meeting, held in the first half of 2023, the Board of the Central Bank of Chile agreed to activate the Countercyclical Capital Buffer (CCyB) for banks, setting it at 0.5% of risk-weighted assets, which must be implemented by May 2024.

 

On November 2, 2020, the FMC published the final guidelines regarding the identification and core capital charge for banks considered Systemically Important Banks (“SIBs”). The FMC, in agreement with the Central Bank, also imposed additional capital requirements for SIBs of between 1-3.5% of risk-weighted assets. This additional capital is being gradually phased in by 25% beginning in December 2021 until December 2025.

 

The General Banking Law also incorporates Pillar II capital requirements to ensure adequate risk management. This pillar’s objective is to ensure that banks maintain capital levels consistent with their risk profile and business model and encourage the development and use of appropriate processes to monitor and manage their risks. Pillar 2 also granted regulators the power to impose greater capital requirements because of deficient evaluations of a bank’s internal capital adequacy assessment process (ICAAP), which should consider a bank’s risk profile and a strategy to sustain adequate levels of capital, even under stress scenarios. The FMC, with at least four votes from the Council of the FMC, will have the power to impose additional regulatory capital demands of up to 4% of risk-weighted assets, either Tier I or Tier II, if it determines that the previous capital levels and buffers are not enough for a particular financial institution. Following the FMC latest revision of the Bank’s solvency and management, a 0% Pillar II requirement was set in 2024 for the Bank. The FMC also stated that it is considering changing its Pilar II requirements to include more banks or to have a permanent Pilar II requirement for all banks beginning in 2025. We cannot assure you that in the future our minimum capital levels will not be increased by the regulator due to new Pillar II capital requirements.

 

We believe our current capital levels are adequate, but we cannot rule out having to raise additional capital in the future in order to maintain our capital adequacy ratios above the minimum required by the FMC. Our ability to raise additional capital may be limited by numerous factors, including: our future financial condition, results of operations and cash flows; any necessary government regulatory approvals; our credit ratings; general market conditions for capital raising activities by commercial banks and other financial institutions; and domestic and international economic, political and other conditions. If we require additional capital in the future, we cannot assure you that we will be able to obtain such capital on favorable terms, in a timely manner or at all. Furthermore, the FMC may increase the minimum capital adequacy requirements applicable to us. Accordingly, although we currently meet the applicable capital adequacy requirements, we may face difficulties in meeting these requirements in the future. If we fail to meet the capital adequacy requirements, we may be required to take corrective actions. These measures could materially and adversely affect our business reputation, financial condition and results of operations. In addition, if we are unable to raise enough capital in a timely manner, the growth of our loan portfolio and other risk-weighted assets may be restricted, and we may face significant challenges in implementing our business strategy. As a result, our prospects, results of operations and financial condition could be materially and adversely affected. For further details of capital requirements, please see “Item 4 Information on the Company—B. Business Overview-Regulation and Supervision—Minimum Capital.”

 

We are subject to liquidity requirements that could limit our operations, and changes to these requirements may further limit and adversely affect our operating results, financial condition and prospects.

 

The FMC and the Central Bank published new liquidity standards in 2015 and ratios that must be implemented and calculated by all banks. These new liquidity standards are in line with those established in Basel III. The most important liquidity ratios that have been adopted by Chilean banks are:

 

Liquidity coverage ratio (LCR), which measures the percentage of liquid assets over net cash outflows. The new guidelines also define liquid assets and the formulas for calculating net cash outflows.

 

Net Stable Funding Ratio (NSFR) which will measure a bank’s available stable funding relative to its required stable funding. Both concepts are also defined in the new regulations.

 

23

 

 

The implementation of internationally accepted liquidity ratios might require changes in business practices that affect our profitability. The LCR is a liquidity standard that measures if banks have enough high-quality liquid assets to cover expected net cash outflows over a 30-day liquidity stress period. The net stable funding ratio (NSFR) provides a sustainable maturity structure of assets and liabilities such that banks maintain a stable funding profile in relation to their activities. As of December 31, 2023 our LCR and NSFR were 212% and 106%, respectively. While we are in compliance of regulatory requirements, no assurance can be made as to whether we will remain in compliance in the future. Moreover, there can be no assurance that the application of the existing regulatory requirements, standards or recommendations will not require us to issue additional securities that qualify as own funds or eligible liabilities, to maintain a greater proportion of its assets in highly-liquid but lower-yielding financial instruments, to liquidate assets, to curtail business or to take any other actions, any of which may have a material adverse effect on the our business, results of operations and/or financial position.

 

We are subject to extensive regulation and regulatory and governmental oversight which could adversely affect our business, operations and financial condition.

 

As a financial institution, we are subject to extensive regulation, inspections, examinations, inquiries, audits and other regulatory requirements by Chilean regulatory authorities, which materially affect our businesses. We cannot assure you that we will be able to meet all of the applicable regulatory requirements and guidelines, or that we will not be subject to sanctions, fines, restrictions on our business or other penalties in the future as a result of noncompliance. If sanctions, fines, restrictions on our business, higher capital requirements or other penalties are imposed on us for failure to comply with applicable requirements, guidelines or regulations, our business, financial condition, results of operations and our reputation and ability to engage in business may be materially and adversely affected.

 

In August 2021, Law No. 21,365 was enacted, regulating interchange fees in the credit card payment market in Chile. An autonomous and technical committee was formed to determine the interchange fee limits, conformed by 4 members designated by the Central Bank, the FMC, the National Economic Prosecutor (Fiscalía Nacional Económica) and the Ministry of Finance. This committee had six months to announce the first transitory limits. Interchange fee limits will be determined every three years. On February 5, 2023, the committee announced the new limits for interchange fees with a maximum fee of 0.6% for debit cards, 1.48% for credit cards and 1.04% for prepaid cards. As a result of this regulation, card fees were reduced by Ch$17 billion in 2022 and Ch$4.5 billion in 2023. We expect that this reduction will have a significant impact on our revenue from card fees, which we expect will decrease by approximately Ch$25 billion in 2024 and approximately Ch$47 billion in 2025.

 

In addition, Congress is currently discussing a bill that would introduce certain debtor rights, limiting interest rates, accelerating clauses and commissions. If enacted as currently proposed, this legislation may negatively affect our interest rate income and fees, which in turn could have a material adverse effect on our operating results, financial condition and prospects. No assurances can be made as to whether this law will be enacted or, if enacted, as to the final provisions contained therein.

 

In their supervisory roles, the regulators seek to maintain the safety and soundness of financial institutions with the aim of strengthening the protection of customers and the financial system. The supervisors’ continuing supervision of financial institutions is conducted through a variety of regulatory tools, including the collection of information by way of prudential returns, reports obtained from skilled persons, visits to firms and regular meetings with management to discuss issues such as performance, risk management and strategy. In general, these regulators have a more outcome-focused regulatory approach that involves more proactive enforcement and more punitive penalties for infringement. As a result, we face increased supervisory scrutiny (resulting in increasing internal compliance costs and supervision fees), and in the event of a breach of our regulatory obligations we are likely to face more stringent regulatory fines.

 

Changes in regulations may also cause us to face increased compliance costs and limitations on our ability to pursue certain business opportunities and provide certain products and services. As some of the banking laws and regulations have been recently adopted, the manner in which those laws and related regulations are applied to the operations of financial institutions is still evolving. Moreover, to the extent these recently adopted regulations are implemented inconsistently in the various jurisdictions in which we operate, we may face higher compliance costs. No assurance can be given generally that laws or regulations will be adopted, enforced or interpreted in a manner that will not have a material adverse effect on our business and results of operations.

 

24

 

 

We are subject to regulation by the FMC and by the Central Bank with regard to certain matters, including reserve requirements, interest rates, foreign exchange mismatches and market risks (see more details on “Item 4. Information on the Company—B. Business Overview—Regulation and Supervision”). Chilean laws, regulations, policies and interpretations of laws relating to the banking sector and financial institutions are continually evolving and changing. Any new reforms could result in increased competition in the industry and thus may have a material adverse effect on our financial condition and results of operations.

 

Pursuant to the General Banking Law, all Chilean banks may, subject to the approval of the FMC, engage in certain businesses other than commercial banking depending on the risk associated with such business and their financial strength. Such additional businesses include securities brokerage, mutual fund management, securitization, insurance brokerage, leasing, factoring, financial advisory, custody and transportation of securities, loan collection and financial services. The General Banking Law also applies to the Chilean banking system a modified version of the capital adequacy guidelines issued by the Basel Committee on Banking Regulation and Supervisory Practices and limits the discretion of the FMC to deny new banking licenses. There can be no assurance that regulators will not in the future impose more restrictive limitations on the activities of banks, including us. Any such change could have a material adverse effect on our financial condition or results of operations.

 

Historically, Chilean banks have not paid interest on amounts deposited in checking accounts. We have begun to pay interest on some checking accounts under certain conditions. If competition or other factors lead us to pay higher interest rates on checking accounts, to relax the conditions under which we pay interest or to increase the number of checking accounts on which we pay interest, any such change could have a material adverse effect on our financial condition or results of operations.

 

Modifications to reserve requirements may affect our business.

 

Deposits are subject to a reserve requirement of 9.0% for demand deposits and 3.6% for time deposits (with terms of less than one year). The Central Bank has statutory authority to require banks to maintain reserves of up to an average of 40.0% for demand deposits and up to 20.0% for time deposits (irrespective, in each case, of the currency in which these deposits are denominated) to implement monetary policy. In addition, to the extent that the aggregate amount of the following types of liabilities exceeds 2.5 times the amount of a bank’s regulatory capital, a bank must maintain a 100% reserve against them: demand deposits, deposits in checking accounts, obligations payable on sight incurred in the ordinary course of business and, in general, all deposits unconditionally payable immediately. The General Banking Law also states that the FMC, with the approval from the Central Bank, may lower this threshold from 2.5 times to 1.5 times a bank’s regulatory capital for a bank considered to be a SIB. This could lead to lower loan growth and have a negative effect on our business. In 2021 the strong rise in demand deposits since the beginning of the pandemic led to a technical reserve of Ch$4,272,695 million, representing 15.2% of our demand deposits as of December 31, 2021. In 2022, our demand deposits decreased and as of December 31, 2022 and 2023, the Bank was not required to, and did not constitute, a corresponding technical reserve.

 

We may not be able to detect or prevent money laundering and other financial crime activities fully or on a timely basis, which could expose us to additional liability and could have a material adverse effect on us.

 

We are required to comply with applicable anti-money laundering anti-terrorism (“AML/CFT”), anti-bribery and corruption, sanctions and other laws and regulations (collectively, financial crime compliance (“FCC”) regulations). These laws and regulations require us, among other things, to conduct full customer due diligence (including sanctions and politically exposed person screening), keep our customer, account and transaction information up to date and have implemented FCC policies and procedures detailing what is required from those responsible. We are also required to conduct FCC training for our employees and to report suspicious transactions and activity to appropriate law enforcement following full investigation by our FCC team.

 

Financial crime continues to be the subject of enhanced regulatory scrutiny and supervision by regulators globally. AML/CFT, anti-bribery and corruption and sanctions laws and regulations are increasingly complex and detailed. The Basel Committee has introduced guidelines to strengthen the interaction and cooperation between prudential and AML/CFT supervisors. Compliance with these laws and regulations requires automated systems, sophisticated monitoring and skilled compliance personnel.

 

25

 

 

We maintain updated policies and procedures aimed at detecting and preventing the use of our banking network for money laundering and other financial crime related activities. However, emerging technologies, such as cryptocurrencies and innovative payment methods, could limit our ability to track the movement of funds. Our ability to comply with the legal requirements depends on our ability to improve detection and reporting capabilities and reduce variation in control processes and oversight accountability. These require implementation and embedding within our business effective controls and monitoring, which in turn requires on-going changes to systems and operational activities. Financial crime is continually evolving and is subject to increasingly stringent regulatory oversight and focus. This requires proactive and adaptable responses from us so that we are able to deter threats and criminality effectively. Even known threats can never be fully eliminated, and there will be instances where we may be used by other parties to engage in money laundering and other illegal or improper activities. In addition, we rely heavily on our employees to assist us by spotting such activities and reporting them, and our employees have varying degrees of experience in recognizing criminal tactics and understanding the level of sophistication of criminal organizations. Where we outsource any of our customer due diligence, customer screening or anti financial crime operations, we remain responsible and accountable for full compliance and any breaches. If we are unable to apply the necessary scrutiny and oversight of third parties to whom we outsource certain tasks and processes, there remains a risk of regulatory breach.

 

If we are unable to comply fully with applicable laws, regulations and expectations, our regulators and relevant law enforcement agencies have the ability and authority to impose significant fines and other penalties on us, including requiring a complete review of our business systems, day-to-day supervision by external consultants and ultimately the revocation of our banking license.

 

We have been, and may in the future be, subject to negative coverage in the media about us or our clients, including with respect to alleged conduct such as failure to detect and/or prevent any financial crime activities or comply with FCC regulations. Negative media coverage of this type about us, whether it has merit or not, could materially and adversely affect our reputation and perception among current and potential clients, investors, vendors, partners, regulators and other third parties, which in turn could have a material adverse effect on our operating results, financial condition and prospects as well as damage our customers’ and investors’ confidence and the market price of our securities.

 

The reputational damage to our business and global brand could be severe if we were found to have breached AML/CFT, anti-bribery and corruption or sanctions requirements. Our reputation could also suffer if we are unable to protect our customers’ bank products and services from being used by criminals for illegal or improper purposes.

 

In addition, while we review our relevant counterparties’ internal policies and procedures with respect to such matters, we expect our relevant counterparties to maintain and properly apply their own appropriate compliance procedures and internal policies. Such measures, procedures and internal policies may not be completely effective in preventing third parties from using our (and our relevant counterparties’) services as a conduit for illicit purposes (including illegal cash transactions) without our (and our relevant counterparties’) knowledge. If we are associated with, or even accused of being associated with, breaches of AML/CFT, anti-bribery and corruption or sanctions requirements, our reputation could suffer and/or we could become subject to fines, sanctions and/or legal enforcement (including being added to “watch lists” that would prohibit certain parties from engaging in transactions with us), any one of which could have a material adverse effect on our operating results, financial condition and prospects.

 

Any such risks could have a material adverse effect on our operating results, financial condition and prospects.

 

We are exposed to risk of loss from legal and regulatory proceedings.

 

We face risk of loss from legal and regulatory proceedings, including tax proceedings, that could subject us to monetary judgements, regulatory enforcement actions, fines and penalties. The current regulatory and tax enforcement environment in the jurisdictions in which we operate reflects an increased supervisory focus on enforcement, combined with uncertainty about the evolution of the regulatory regime, and may lead to material operational and compliance costs.

 

We are from time to time subject to regulatory investigations and civil and tax claims, and party to certain legal proceedings incidental to the normal course of our business, including, among others, in connection with conflicts of interest, lending and derivatives activities, relationships with our employees and other commercial, data protection or tax matters. In view of the inherent difficulty of predicting the outcome of legal matters, particularly where the claimants seek very large or indeterminate damages, or where the cases present novel legal theories, involve a large number of parties or are in the early stages of investigation or discovery, we cannot state with certainty what the eventual outcome of these pending matters will be or what the eventual loss, fines or penalties related to each pending matter may be.

 

26

 

 

The amount of our reserves in respect of these matters, which considers the likelihood of future cash flows associated with each of such claims, is substantially less than the total amount of the claims asserted against us, and, in light of the uncertainties involved in such claims and proceedings, there is no assurance that the ultimate resolution of these matters will not significantly exceed the reserves currently accrued by us. As a result, the outcome of a particular matter may be material to our operating results for a particular period. As of December 31, 2023, we had provisions for legal contingencies of Ch$4,504 million.

 

RISK FACTORS IN RESPECT OF CHILE

 

Political, legal, regulatory and economic uncertainty arising from social unrest and the resulting social reforms, as well as the potential enactment of a new constitution could adversely impact the Bank’s business.

 

During October 2019, growing public concern over perceived social inequality led to a rise in social unrest. The social unrest caused commercial disruptions throughout the country, especially in Santiago and other major cities, including Valparaíso and Concepción. After three weeks of nationwide protests, the Chilean government announced in November 2019 that it would initiate a process to draft a new Constitution for Chile. When the government announced the process of enacting a new constitution, there was increased volatility in the Chilean stock market and exchange rate fluctuations that resulted in a weakening of the Chilean peso against the U.S. dollar. The share prices on local banks and bond spreads, including those of Santander Chile, suffered significant declines in the market. After a prolonged drafting process, a proposed draft of the constitution was rejected by 62% of voters in July 2022, as a consequence of which a new constitutional drafting process was agreed upon by the different political parties. In December 2023, a second draft of the constitution was put to the vote and more than 55% of voters elected to reject the constitutional amendment. As a result, the constitution drafted in 1980 remains in force. Although the government has publicly stated that it will not launch a new constitutional reform process, it is uncertain whether this process will not be initiated again at a later date or by a different government. There can be no assurance as to whether a new constitutional reform process, or any amendments to the Chilean Constitution implemented as a consequence of such a process, will not have a material adverse effect on our business, financial condition or results of operations.

 

Our growth, asset quality and profitability may be adversely affected by macroeconomic and political conditions in Chile.

 

A substantial number of our loans are to borrowers doing business in Chile. Chile’s economy has experienced significant volatility in recent decades, characterized, in some cases, by slow or regressive growth and declining investment. For example, the Chilean economy contracted 5.8% in 2020 as a result of the COVID-19 pandemic but recovered in 2021, growing 11.7%. In 2022, the rate of growth slowed to 2.4% and in 2023 GDP growth is expected to be –0.2%, as a result of deteriorating economic conditions in Chile and globally, including high inflation and high interest rates. This volatility resulted in fluctuations in the levels of deposits and in the relative economic strength of various segments of the economies to which we lend. The Chilean economy may not continue to grow at similar rates as in the past or future developments may negatively affect Chile’s overall levels of economic activity.

 

Negative and fluctuating economic conditions, such as slowing or negative growth and a changing interest rate and inflationary environment, impact our profitability by causing lending margins to decrease and credit quality to decline and leading to decreased demand for higher margin products and services. Even though Chile’s sovereign rating remains at an investment grade level, negative and fluctuating economic conditions in Chile could also result in government defaults on public debt. This could affect us in two ways: directly, through portfolio losses, and indirectly, through instabilities that a default in public debt could cause to the banking system, particularly since commercial banks’ exposure to government debt is high in Chile.

 

Our revenues are also subject to risk of loss from unfavorable political and diplomatic developments, social instability, international conflicts, and changes in governmental policies, including expropriation, nationalization, international ownership legislation, interest-rate caps and tax policies.

 

27

 

 

Any future fluctuation in oil prices may give rise to volatility in the global financial markets and further economic instability in oil-importing countries, such as Chile. In addition, the ability of borrowers in or exposed to the oil sector has been and may be further adversely affected by such price fluctuations.

 

Any future fall in commodity prices, such as copper, cellulose, fruit, wine, lithium and salmon prices, could have a material adverse effect on the Chilean economy, which could in turn have a material adverse effect on our financial condition and operations.

 

Our growth, asset quality and profitability may be adversely affected by volatile macroeconomic and political conditions in Chile.

 

Any material change to United States trade policy with respect to Chile could have a material adverse effect on the economy, which could in turn materially harm our financial condition and results of operations.

 

Portions of our loan portfolio are subject to risks relating to force majeure events and any such event could materially adversely affect our operating results.

 

Chile lies on the Nazca tectonic plate, making it one of the world’s most seismically active regions. Our financial and operating performance may be adversely affected by force majeure events, such as natural disasters, particularly in locations where a significant portion of our loan portfolio is composed of real estate loans. Natural disasters such as earthquakes and floods may cause widespread damage which could impair the asset quality of our loan portfolio and could have an adverse impact on the economy of the affected region.

 

Changes in taxes, including the corporate tax rate, in Chile may have an adverse effect on us and our clients.

 

The Chilean government enacted various tax reforms in 2014, 2016 and 2020 in order to finance greater social expenditures. The most relevant change was the rise of the corporate tax rate to 27% in 2018. There is currently discussion of another tax reform to finance an expected increase in social spending. In January 29, 2024, the government issued a new tax reform proposal which seeks to increase tax revenues by 1.5% of GDP, and there is expectations that the tax reform could be approved by Congress in 2024. Proposals included in the tax reform are mainly related to changes to Chilean GAAR provisions, the neutrality of foreign corporate reorganizations and VAT provisions. We cannot predict at this time if these proposed reforms will have a material impact on our business or clients or if further tax reforms will be implemented in the future. Banco Santander Chile’s effective corporate tax rate could rise in the future, including as a result of the proposed reforms described above, which may have an adverse impact on our results of operations. Please see “Item 10—Additional information—E. Taxation” for more information regarding the impacts of these tax reforms on ADR holders.

 

Developments in other countries may affect us, including the prices for our securities.

 

The prices of securities issued by Chilean companies, including banks, are influenced to varying degrees by economic and market considerations in other countries. We cannot assure you that future developments in or affecting the Chilean economy, including consequences of economic difficulties in other markets, will not materially and adversely affect our business, financial condition or results of operations.

 

We are exposed to risks related to the weakness and volatility of the economic and political situation in Asia, the United States, Europe (including Spain, where Santander Spain, our controlling shareholder, is based), Brazil, Argentina and other nations. Although economic conditions in Europe and the United States may differ significantly from economic conditions in Chile, investors’ reactions to developments in these other countries may have an adverse effect on the market value of securities of Chilean issuers. In particular, investor perceptions of the risks associated with our securities may be affected by perception of risk conditions in Spain.

 

If these, or other nations’ economic conditions deteriorate, the economy in Chile, as both a neighboring country and a trading partner, could also be affected and could experience slower growth than in recent years, with possible adverse impact on our borrowers and counterparties. If this were to occur, we would potentially need to increase our allowances for loan losses, thus affecting our financial results, our results of operations and the price of our securities. As of December 31, 2023, the Bank’s foreign exposure, including counterparty risk in the derivative instruments’ portfolio, was U.S.$4,108 million or 5.1% of our total assets. There can be no assurance that the effects of a global recession will not negatively impact growth, consumption, unemployment, investment and the price of exports in Chile.

 

28

 

 

Chile has considerable economic ties with China, the United States and Europe. In 2023, approximately 39% of Chile’s exports went to China, mainly copper. A slowdown in economic activity in China may affect Chile’s GDP and export growth as well as the price of copper, which is Chile’s main export. Chile exported approximately 16% of total exports to the United States and 10% to Europe in 2023. Crises and political uncertainties in these economies could also have an adverse effect on Chile, the price of our securities or our business.

 

Approximately 14% of Chile’s exports in 2023 went to other Latin American nations. We cannot assure you that crises and political uncertainty in other Latin American countries will not have an adverse effect on Chile, the price of our securities or our business.

 

A change in labor laws in Chile or a worsening of labor relations in the Bank could impact our business.

 

As of December 31, 2023, on a consolidated basis, we had 9,229 employees, of which 71.9% were unionized. In December 2023, a new collective bargaining agreement was signed with the main unions, which will become effective in September 2024 and expire in December 2027. We generally apply the terms of our collective bargaining agreement to unionized and non-unionized employees. We have traditionally had good relations with our employees and their unions, but we cannot assure you that in the future, a strengthening of cross-industry labor movements will not materially and adversely affect our business, financial condition or results of operations.

 

A new labor reform was approved by Congress in April 2023, which, among other reforms, shortened the work week from 45 hours to 40 hours. Additionally, the minimum wage formerly set at Ch$350,000/month (U.S.$400/month) in 2022 has been gradually increased and will reach Ch$500,000/month (U.S.$572/month) as of July 1, 2024. At Santander Chile, the weekly working hours agreed under the new collective bargaining agreement were set at 40 hours and the minimum wage at the Bank was set at Ch$1,030,000 as of June 2024 (U.S.$1,178/month). Despite this, we cannot assure that the new labor reform, or any further increases to the minimum wage, will not have material impact on our expenses.

 

In addition, a bill was introduced to Congress to modify the terms of the “gratificación legal,” which consists of an annual participation to employees of a company’s profit. The new bill being discussed seeks to modify the Labor Code regarding the participation of workers in the profits of companies. The new bill proposes to modify the Labor Code to increase the gratificación legal distributed to employees and change the way it is calculated. This bill was approved by the Chamber of Deputies of the Chilean Congress and is currently in the Senate with no set date for discussion. No assurances can be made as to whether the proposed bill will be approved and as to whether, if approved, it will have a material impact on our financial condition.

 

These and any additional legislative or regulatory actions in Chile, Spain, the European Union, the United States or other countries, and any required changes to our business operations resulting from such legislation and regulations, could result in reduced capital availability, significant loss of revenue, limit our ability to continue organic growth (including increased lending), pursue business opportunities in which we might otherwise consider engaging and provide certain products and services, affect the value of assets that we hold, require us to increase our prices and therefore reduce demand for our products, impose additional costs on us or otherwise adversely affect our businesses. Accordingly, we cannot provide assurance that any such new legislation or regulations would not have an adverse effect on our business, results of operations or financial condition in the future.

 

Our corporate disclosure may differ from disclosure regularly published by issuers of securities in other countries, including the United States.

 

Issuers of securities in Chile are required to make public disclosures that are different from, and that may be reported under presentations that are not consistent with, disclosures required in other countries, including the United States. In particular, as a Chilean regulated financial institution, we are required to submit to the FMC on a monthly basis unaudited consolidated balance sheets and income statements, excluding any note disclosure, prepared in accordance with Chilean Bank GAAP as issued by the FMC. This disclosure differs in a number of significant respects from generally accepted accounting principles in the United States and information generally available in the United States with respect to U.S. financial institutions or IFRS. In addition, as a foreign private issuer, we are not subject to the same disclosure requirements in the United States as a domestic U.S. registrant under the Exchange Act, including the requirements to prepare and issue quarterly reports, the proxy rules applicable to domestic U.S. registrants under Section 14 of the Exchange Act or the insider reporting and short-swing profit rules under Section 16 of the Exchange Act. Accordingly, the information about us available to you will not be the same as the information available to shareholders of a U.S. company and may be reported in a manner that you are not familiar with.

 

29

 

 

Risks Factors In Respect Of Our Controlling Shareholder and our ADSs

 

Investors may find it difficult to enforce civil liabilities against us or our directors, officers and controlling persons.

 

We are a Chilean corporation. None of our directors are residents of the United States and most of our executive officers reside outside of the United States. In addition, all or a substantial portion of our assets and the assets of our directors and executive officers are located outside of the United States. Although we have appointed an agent for service of process in any action against us in the United States, none of our directors, officers or controlling persons has consented to service of process in the United States or to the jurisdiction of any United States court. As a result, it may be difficult for investors to effect service of process within the United States on such persons.

 

It may also be difficult for ADS holders to enforce in the United States or in Chilean courts money judgments obtained in United States courts against us or our directors and executive officers based on civil liability provisions of the U.S. federal securities laws. If a U.S. court grants a final money judgment in an action based on the civil liability provisions of the federal securities laws of the United States, enforceability of this money judgment in Chile will be subject to the obtaining of the relevant “exequatur” (i.e., recognition and enforcement of the foreign judgment) according to Chilean civil procedure law currently in force, and consequently, subject to the satisfaction of certain factors. The most important of these factors are the existence of reciprocity, the absence of a conflicting judgment by a Chilean court relating to the same parties and arising from the same facts and circumstances and the Chilean courts’ determination that the U.S. courts had jurisdiction, that process was appropriately served on the defendant and that enforcement would not violate Chilean public policy. Failure to satisfy any of such requirements may result in non-enforcement of your rights.

 

Our controlling shareholder has a great deal of influence over our business and its interests could conflict with yours.

 

Santander Spain controls Santander-Chile through its holdings in Teatinos Siglo XXI Inversiones S.A. and Santander Chile Holding S.A., which are controlled subsidiaries. Santander Spain has control over 67.18% of our shares and an actual participation, excluding non-controlling shareholders that participate in Santander Chile Holding, S.A., of 67.13%.

 

Due to its share ownership, our controlling shareholder has the ability to control us and our subsidiaries, including the ability to:

 

elect the majority of the directors and exercise control over our company and subsidiaries;

 

cause the appointment of our principal officers;

 

declare the payment of any dividends;

 

agree to sell or otherwise transfer its controlling stake in us; and

 

determine the outcome of substantially all actions requiring shareholder approval, including amendments of our by-laws, transactions with related parties, corporate reorganizations, acquisitions and disposals of assets and issuance of additional equity securities, if any.

 

We operate as a stand-alone subsidiary within the Santander Group. Our controlling shareholder has no liability for our banking operations, except for the amount of its holdings of our capital stock and AT1 bond. The interests of Santander Spain may differ from the interests of our other shareholders, and the concentration of control in Santander Spain may differ from the interests of our other shareholders, and the concentration of control in Santander Spain will limit other shareholders’ ability to influence corporate matters. As a result, we may take actions that our other shareholders do not view as beneficial.

 

30

 

 

Our status as a controlled company and a foreign private issuer exempts us from certain of the corporate governance standards of the New York Stock Exchange (“NYSE”), limiting the protections afforded to investors.

 

We are a “controlled company” and a “foreign private issuer” within the meaning of the NYSE corporate governance standards. Under the NYSE rules, a controlled company is exempt from certain NYSE corporate governance requirements. In addition, a foreign private issuer may elect to comply with the practice of its home country and not to comply with certain NYSE corporate governance requirements, including the requirements that (1) a majority of the board of directors consist of independent directors, (2) a nominating and corporate governance committee be established that is composed entirely of independent directors and has a written charter addressing the committee’s purpose and responsibilities, (3) a compensation committee be established that is composed entirely of independent directors and has a written charter addressing the committee’s purpose and responsibilities and (4) an annual performance evaluation of the nominating and corporate governance and compensation committees be undertaken. Although we have similar practices, they do not entirely conform to the NYSE requirements for U.S. issuers; therefore, we currently use these exemptions and intend to continue using them. Accordingly, you will not have the same protections afforded to shareholders of companies that are subject to all NYSE corporate governance requirements.

 

There may be a lack of liquidity and market for our shares and ADSs.

 

Our ADSs are listed and traded on the NYSE (under the ticker “BSAC”). Our common stock is listed and traded on the Santiago Stock Exchange (under the ticker “BSANTANDER”), which we refer to as the Chilean Stock Exchange, although the trading market for the common stock is small by international standards. As of December 31, 2023, we had 188,446,126,794 shares of common stock outstanding. The Chilean securities markets are substantially smaller, less liquid and more volatile than major securities markets in the United States. According to Article 14 of the Ley de Mercado de Valores, Ley No. 18,045, or the Chilean Securities Market Law, the FMC may suspend the offer, quotation or trading of shares of any company listed on one or more Chilean stock exchanges for up to 30 days if, in its opinion, such suspension is necessary to protect investors or is justified for reasons of public interest. Such suspension may be extended for up to 120 days. If, at the expiration of the extension, the circumstances giving rise to the original suspension have not changed, the FMC will then cancel the relevant listing in the registry of securities. In addition, the Santiago Stock Exchange may inquire as to any movement in the price of any securities in excess of 10% and suspend trading in such securities for a day if it is deemed necessary.

 

Although our common stock is traded on the Chilean Stock Exchange, there can be no assurance that a liquid trading market for our common stock will continue to exist. Approximately 32.82% of our outstanding common stock is held by the public (i.e., shareholders other than Santander Spain and its affiliates), including our shares that are represented by ADSs trading on the NYSE. A limited trading market in general and our concentrated ownership in particular may impair the ability of an ADS holder to sell in the Chilean market shares of common stock obtained upon withdrawal of such shares from the ADR facility in the amount and at the price and time such holder desires and could increase the volatility of the price of the ADSs.

 

Chile imposes controls on foreign investment and repatriation of investments that may affect your investment in, and earnings from, our ADSs.

 

Equity investments in Chile by persons who are not Chilean residents have generally been subject to various exchange control regulations, which restrict the repatriation of the investments and earnings therefrom. In April 2001, the Central Bank eliminated the regulations that affected foreign investors, except that investors are still required to provide the Central Bank with information relating to equity investments and conduct such operations within Chile’s Formal Exchange Market. The ADSs are subject to a contract, dated May 17, 1994, among the Depositary, us and the Central Bank (the “Foreign Investment Contract”) that remains in full force and effect. The ADSs continue to be governed by the provisions of the Foreign Investment Contract subject to the regulations in existence prior to April 2001. The Foreign Investment Contract grants the Depositary and the holders of the ADSs access to the Formal Exchange Market, which permits the Depositary to remit dividends it receives from us to the holders of the ADSs. The Foreign Investment Contract also permits ADS holders to repatriate the proceeds from the sale of shares of our common stock withdrawn from the ADR facility, or that have been received free of payment as a consequence of spin offs, mergers, capital increases, wind ups, share dividends or preemptive rights transfers, enabling them to acquire the foreign currency necessary to repatriate earnings from such investments. Pursuant to Chilean law, the Foreign Investment Contract cannot be amended unilaterally by the Central Bank, and there are judicial precedents (although not binding with respect to future judicial decisions) indicating that contracts of this type may not be abrogated by future legislative changes or resolutions of the Advisory Council of the Central Bank. Holders of shares of our common stock, except for shares of our common stock withdrawn from the ADS facility or received in the manner described above, are not entitled to the benefits of the Foreign Investment Contract, may not have access to the Formal Exchange Market, and may have restrictions on their ability to repatriate investments in shares of our common stock and earnings therefrom.

 

31

 

 

Holders of ADSs are entitled to receive dividends on the underlying shares to the same extent as the holders of shares. Dividends received by holders of ADSs will be paid net of foreign currency exchange fees and expenses of the Depositary and will be subject to the Chilean withholding tax, currently imposed at a rate of 35.0% (subject to credits in certain cases). If for any reason, including changes in Chilean law, the Depositary was unable to convert Chilean pesos to U.S. dollars, investors would receive dividends and other distributions, if any, in Chilean pesos.

 

We cannot assure you that additional Chilean restrictions applicable to holders of our ADSs, the disposition of the shares underlying them or the repatriation of the proceeds from such disposition or the payment of dividends will not be imposed in the future, nor can we advise you as to the duration or impact of such restrictions if imposed.

 

You may be unable to exercise preemptive rights.

 

The Ley Sobre Sociedades Anónimas, Ley No. 18,046 and the Reglamento de Sociedades Anónimas, which we refer to collectively as the Chilean Companies Law, and applicable regulations require that whenever we issue new common stock for cash, we grant preemptive rights to all of our shareholders (including holders of ADSs), giving them the right to purchase a sufficient number of shares to maintain their existing ownership percentage. Such an offering would not be possible in the United States unless a registration statement under the U.S. Securities Act of 1933 (“Securities Act”), as amended, was effective with respect to such rights and common stock or an exemption from the registration requirements thereunder were available.

 

Since we are not obligated to make a registration statement available with respect to such rights and the common stock, you may not be able to exercise your preemptive rights in the United States. If a registration statement is not filed or an applicable exemption is not available under U.S. securities law, the Depositary will sell such holders’ preemptive rights and distribute the proceeds thereof if a premium can be recognized over the cost of any such sale.

 

As a holder of ADSs you will have different shareholders’ rights than in the United States and certain other jurisdictions.

 

Our corporate affairs are governed by our bylaws, and the laws of Chile, which may differ from the legal principles that would apply if we were incorporated in a jurisdiction in the United States or in certain other jurisdictions outside Chile. Under Chilean corporate law, you may have fewer and less well-defined rights to protect your interests than under the laws of other jurisdictions outside Chile. For example, under legislation applicable to Chilean banks, our shareholders would not be entitled to appraisal rights in the event of a merger or other business combination undertaken by us.

 

Although Chilean corporate law imposes restrictions on insider trading and price manipulation, the form of these regulations and the manner of their enforcement may differ from that in the U.S. securities markets or markets in certain other jurisdictions. In addition, in Chile, self-dealing and the preservation of shareholder interests may be regulated differently, which could potentially disadvantage you as a holder of the shares underlying ADSs.

 

Holders of ADSs may find it difficult to exercise voting rights at our shareholders’ meetings.

 

Holders of ADSs will not be our direct shareholders and will be unable to enforce directly the rights of shareholders under our by-laws and the laws of Chile. Holders of ADSs may exercise voting rights with respect to the common stock represented by ADSs only in accordance with the deposit agreement governing the ADSs. Holders of ADSs will face practical limitations in exercising their voting rights because of the additional steps involved in our communications with ADS holders. Holders of our common stock will be able to exercise their voting rights by attending a shareholders’ meeting in person or voting by proxy. By contrast, holders of ADSs will receive notice of a shareholders’ meeting by mail from the Depositary following our notice to the Depositary requesting the Depository to do so. To exercise their voting rights, holders of ADSs must instruct the Depositary on a timely basis on how they wish to vote. This voting process necessarily will take longer for holders of ADSs than for holders of our common stock. If the Depositary fails to receive timely voting instructions for all or part of the ADSs, the Depositary will assume that the holders of those ADSs are instructing it to give a discretionary proxy to a person designated by us to vote their ADSs, except in limited circumstances.

 

32

 

 

Holders of ADSs also may not receive the voting materials in time to instruct the Depositary to vote on the common stock underlying their ADSs. In addition, the Depositary and its agents are not responsible for failing to carry out voting instructions of the holders of ADSs or for the manner of carrying out those voting instructions. Accordingly, holders of ADSs may not be able to exercise voting rights, and they will have little, if any, recourse if the common stocks underlying their ADSs are not voted as requested.

 

ADS holders may be subject to additional risks related to holding ADSs rather than shares.

 

Because ADS holders do not hold their shares directly, they are subject to the following additional risks, among others:

 

as an ADS holder, you may not be able to exercise the same shareholder rights as a direct holder of ordinary shares;

 

we and the Depositary may amend or terminate the deposit agreement without the ADS holders’ consent in a manner that could prejudice ADS holders or that could affect the ability of ADS holders to transfer ADSs; and

 

the Depositary may take or be required to take actions under the Deposit Agreement that may have adverse consequences for some ADS holders in their particular circumstances.

 

GENERAL RISK FACTORS

 

Disclosure controls and procedures over financial and non-financial reporting may not prevent or detect all errors or acts of fraud.

 

Disclosure controls and procedures, including internal controls, over financial and non-financial reporting (including climate-related reporting) are designed to provide reasonable assurance that information required to be disclosed by the company in reports filed or submitted under the Securities Exchange Act of 1934 (the “Exchange Act”) is accumulated and communicated to management, and recorded, processed, summarized and reported within the time periods specified in the SEC’s U.S. Securities and Exchange Commission’s rules and forms.

 

These disclosure controls and procedures have inherent limitations, which include the possibility that judgements in decision-making can be faulty and that breakdowns can occur because of errors or mistakes. Additionally, controls can be circumvented by any unauthorized override of the controls. Consequently, our businesses are exposed to risk from potential non-compliance with policies, employee misconduct or negligence and fraud, which could result in regulatory sanctions, civil claims and serious reputational or financial harm. In recent years, several multinational financial institutions have suffered material losses due to the actions of ‘rogue traders’ or other employees. It is not always possible to deter employee misconduct and the precautions we take to prevent and detect this activity may not always be effective. Accordingly, because of the inherent limitations in the control system, misstatements due to error or fraud may occur and not be detected.

 

Our financial statements are based in part on assumptions and estimates which, if inaccurate, could cause material misstatement of the results of our operations and financial position.

 

The preparation of financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of assets, liabilities, income and expenses. Due to the inherent uncertainty in making estimates, actual results reported in future periods may be based upon amounts which differ from those estimates. Estimates, judgements and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Revisions to accounting estimates are recognized in the period in which the estimate is revised and in any future periods affected. The accounting policies deemed critical to our results and financial position, based upon materiality and significant judgements and estimates, include impairment of loans and advances, good will impairment, valuation of financial instruments, deferred tax assets –provisions and pension obligations for liabilities.

 

33

 

 

If the judgement, estimates and assumptions we use in preparing our consolidated financial statements are subsequently found to be incorrect, there could be a material effect on our results of operations and a corresponding effect on our funding requirements and capital ratios.

 

Changes in accounting standards could impact reported earnings.

 

The accounting standard setters and other regulatory bodies periodically change the financial accounting and reporting standards that govern the preparation of our consolidated financial statements. Changes made to accounting standards can materially impact how we record and report our financial condition and results of operations, as well as affect the calculation of our capital ratios. In some cases, we could be required to apply a new or revised standard retroactively, resulting in the restatement of prior period financial statements. Various amendments were made to financial and accounting standards in 2021, 2022 and 2023. For more information about current and future developments in financial accounting and reporting standards, see Note 1(y) “Application of new and revised International Financial Reporting Standards” to our Audited Consolidated Financial Statements.

 

We rely on recruiting, retaining and developing appropriate senior management and skilled personnel.

 

Our continued success depends in part on the continued service of key members of our senior executive team and other key employees. The ability to continue to attract, train, motivate and retain highly qualified and talented professionals is a key element of our strategy. The successful implementation of our strategy and culture depends on the availability of skilled and appropriate management, both at our head office and in each of our business units. If we or one of our business units or other functions fails to staff its operations appropriately or loses one or more of its key senior executives or other key employees and fails to replace them in a satisfactory and timely manner, our business, financial condition and results of operations, including control and operational risks, may be adversely affected.

 

Our ability to attract and retain qualified employees is affected by perceptions of our culture, social and corporate governance policies and management, our profile in the markets in which we operate and the professional opportunities we offer.

 

In addition, the financial industry has and may continue to experience more stringent regulation of employee compensation, which could have an adverse effect on our ability to hire or retain the most qualified employees. If we fail or are unable to attract and appropriately train, motivate and retain qualified professionals, our business may also be adversely affected.

 

Our business could be affected if its capital is not managed effectively or if changes limiting our ability to manage our capital position are adopted.

 

Effective management of our capital position is important to our ability to operate our business, to continue to grow organically and to pursue our business strategy. However, in response to the global financial crisis, several changes to the regulatory capital framework have been adopted. As these and other changes are implemented or future changes are considered or adopted that limit our ability to manage our balance sheet and capital resources effectively or to access funding on commercially acceptable terms, we may experience a material adverse effect on our financial condition and regulatory capital position.

 

34

 

 

We are subject to review by tax authorities, and an incorrect interpretation by us of tax laws and regulations may have a material adverse effect on us.

 

Preparing our tax returns requires the use of estimates and interpretations of complex tax laws and regulations and is subject to review by tax authorities.

 

We are subject to the income tax laws of Chile and certain foreign countries. These tax laws are complex and subject to different interpretations by the taxpayer and relevant governmental tax authorities, which are sometimes subject to prolonged evaluation periods until a final resolution is reached. In establishing a provision for income tax expense and filing returns, we must make judgements and interpretations about the application of these inherently complex tax laws.

 

If the judgement, estimates and assumptions we use in preparing our tax returns are subsequently found to be incorrect, there could be a material adverse effect on our results of operations. In some jurisdictions, the interpretations of the tax authorities are unpredictable and frequently involve litigation, which introduces further uncertainty and risk as to tax expense.

 

We engage in transactions with related parties that others may not consider to be on an arm’s-length basis.

 

We and our affiliates have entered into several services agreements pursuant to which we render services, such as administrative, accounting, finance, treasury, legal services and others.

 

Chilean law applicable to public companies and financial groups and institutions and our by-laws provide for several procedures designed to ensure that the transactions entered into with or among our financial subsidiaries and/or affiliates do not deviate from prevailing market conditions for those types of transactions, including the requirement that our board of directors approve such transactions. Furthermore, all significant related party transactions must be approved by the Audit Committee and the Board. These significant transactions are also reported in our annual shareholders’ meeting. Please see Note 34 to our Audited Consolidated Financial Statements and “Item 7. Major Shareholders and Related Party Transactions.”

 

We are likely to continue to engage in transactions with our affiliates. Future conflicts of interests between us and any of our affiliates, or among our affiliates, may arise, which conflicts are not required to be and may not be resolved in our favor.

 

35

 

 

ITEM 4. INFORMATION ON THE COMPANY

 

A. History and Development of the Company

 

Overview

 

We are the largest bank in the Chilean market in terms of loans (excluding loans held by subsidiaries of Chilean banks abroad) and the second largest bank in terms of total deposits (excluding deposits held by subsidiaries of Chilean banks aboard). As of December 31, 2023, we had total assets of Ch$71,089,439 million (U.S.$81.3 billion), outstanding loans at amortized cost, net of allowances for loan losses and including interbank loans of Ch$39,661,895 million (U.S.$45.4 billion), total deposits of Ch$29,675,768 million (U.S.$33.9 billion) and shareholders’ equity of Ch$5,217,760 million (U.S.$6.o billion). As of December 31, 2023, we employed 9,229 people. We have a leading presence in all the major business segments in Chile, and a large distribution network with national coverage spanning across all the country and a leading digital onboarding platform for new clients. We offer unique transaction capabilities to clients through our 247 branches and 2,103 ATMs. Our headquarters are in Santiago, and we operate in every major region of Chile.

 

We provide a broad range of commercial and retail banking services to our customers, including Chilean peso and foreign currency denominated loans to finance a variety of commercial transactions, trade, foreign currency forward contracts and credit lines and a variety of retail banking services, including mortgage financing. We seek to offer our customers a wide range of products while providing high levels of service. In addition to our traditional banking operations, we offer a variety of financial services, including financial leasing, financial advisory services, mutual fund management, securities brokerage, insurance brokerage and investment management.

 

The legal predecessor of Santander-Chile was Banco Santiago (“Santiago”). Old Santander-Chile was established as a subsidiary of Santander Spain in 1978. On August 1, 2002, Santiago and Old Santander Chile merged, whereby the latter ceased to exist and Santander-Chile (formerly known as Santiago) being the surviving entity.

 

Our principal executive offices are located at Bandera 140, 20th floor, Santiago, Chile. Our telephone number is +562-320-2000 and our website is www.santander.cl. None of the information contained on our website is incorporated by reference into, or forms part of, this Annual Report. Our agent for service of process in the United States is Puglisi & Associates, 850 Library Ave., Suite 204, Newark, DE 19711. The SEC maintains a website on the Internet at http://www.sec.gov that contains reports and information statements and other information about us. The reports (including this annual report) and information statements and other information about us can be downloaded from the SEC’s website www.sec.gov website or our investor relations website www.santandercl.gcs-web.com. None of the information contained on our website, or any website referred to in this Annual Report, is incorporated by reference into, or forms part of, this Annual Report.

 

Relationship with Grupo Santander

 

We believe that our relationship with our controlling shareholder, Santander Spain, offers us a significant competitive advantage over our peer Chilean banks. Grupo Santander, our parent company, is one of the largest financial groups in Brazil and the rest of Latin America, in terms of total assets measured on a regional basis. It is the largest financial group in Spain and is a major player elsewhere in Europe, including the United Kingdom, Poland and Portugal. Through Santander Consumer, it also operates a leading consumer finance franchise in the United States, as well as in Germany, Italy, Spain, and several other European countries.

 

Our relationship with Santander Spain provides us with access to the group’s client base, while its multinational focus allows us to offer international solutions to our clients’ financial needs. We also have the benefit of selectively borrowing from Santander Spain’s product offerings in other countries, as well as of its know-how in systems management. We believe that our relationship with Santander Spain will also enhance our ability to manage credit and market risks by adopting policies and knowledge developed by Santander Spain. In addition, our internal auditing function has been strengthened as a result of the addition of an internal auditing department that concurrently reports directly to our Audit Committee and the audit committee of Santander Spain. We believe that this structure leads to improved monitoring and control of our exposure to operational risks.

 

Grupo Santander’s support of Santander-Chile includes the assignment of managerial personnel to key supervisory areas of Santander-Chile, such as risks, auditing, accounting and financial control. Santander-Chile does not pay any management fees to Santander Spain in connection with these support services.

 

36

 

 

B. Business Overview

 

We have 247 branches of which: (i) 136 are traditional full product and transactional branches operated under the Santander brand name; (ii) 86 are WorkCafé branches, which are high-tech digital branches that are mainly focused on providing value added products without tellers and minimal back office; (iii) 5 are WorkCafé Espresso branches, all of which were opened in 2023, with a high-tech and efficient format exclusively dedicated to transactional operations with tellers; (iv) 4 are Select branches for affluent customers and; (v) 16 are auxiliary branches and payment centers located in large companies or universities mainly for Middle-market clients. We provide a full range of financial services to corporate and individual customers.

 

We divide our clients into the following groups: (i) Retail banking, (ii) Middle-market, (iii) Corporate Investment Banking and (iv) Corporate Activities (“Other”).

 

The Bank has the reportable segments noted below see “Segmentation Criteria” for further information.

 

Retail Banking

 

This segment consists of individuals and small to medium-sized entities (SMEs) with annual sales less than Ch$3,000 million (U.S.$3.4 million). This segment gives customers a variety of services, including consumer loans, credit cards, auto loans, commercial loans, foreign exchange, mortgage loans, debit cards, checking accounts, savings products, securities brokerage, and insurance brokerage. Additionally, the SME clients are offered government-guaranteed loans, foreign trade services, leasing, factoring, and transactional services.

 

Middle-market

 

This segment serves companies and large corporations with annual sales exceeding Ch$3,000 million (U.S.$3.4 million). It also serves institutions such as universities, government entities, local and regional governments and companies engaged in the real estate industry who carry out projects to sell properties to third parties and annual sales exceeding Ch$800 million (U.S.$0.9 million) with no upper limit. The companies within this segment have access to many products including commercial loans, leasing, factoring, foreign trade, credit cards, mortgage loans, checking accounts, transactional services, treasury services, financial consulting, savings products, securities brokerage, and insurance brokerage. Also, companies in the real estate industry are offered specialized services to finance projects, chiefly residential, with the aim of expanding sales of mortgage loans.

 

Corporate Investment Banking (“CIB”)

 

This segment consists of foreign and domestic multinational companies with sales over Ch$10,000 million (U.S.$11.4 million). The companies within this segment have access to many products including commercial loans, leasing, factoring, foreign trade, project finance, credit cards, mortgage loans, checking accounts, transactional services, treasury services, financial consulting, investments, savings products, securities brokerage, and insurance brokerage.

 

This segment also consists of a Treasury Division which provides sophisticated financial products, mainly to companies in the Middle-market segment and Corporate Investment Banking. These include products such as short-term financing and fund raising, brokerage services, foreign exchange services, derivatives, securitization and other tailor-made products. The Treasury Division may act as broker to transactions and manages the Bank’s trading fixed income portfolio.

 

Corporate Activities (“Other”)

 

This segment mainly includes our Financial Management Division, which develops global management functions, including managing inflation rate risk, foreign currency gaps, interest rate risk and liquidity risk. Liquidity risk is managed mainly through wholesale deposits, debt issuances and the Bank’s available-for-sale portfolio. This segment also manages capital allocation by unit. These activities, with the exception of our inflation gap, usually result in a negative contribution to income.

 

In addition, this segment encompasses all the intra-segment income and all the activities not assigned to a given segment or product with customers.

 

37

 

 

The segments’ accounting policies are those described in the summary of accounting policies. 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 tables below show the Bank’s results by reporting segment for the year ended December 31, 2023, in addition to the corresponding balances of loans and accounts receivable from customers:

 

   For the year ended December 31, 2023 
   Loans and accounts receivable at amortized
cost(1)
   Deposits and other demand liabilities   Net interest income   Net fee and commission income   Net income from financial operations   Provision for loan losses   Support expenses(2)   Segment’s net contribution 
   (In millions of Ch$) 
Retail Banking   29,066,792    13,896,076    1,381,014    376,643    45,573    (295,221)   (661,901)   846,108 
Middle-market   8,774,343    5,513,939    459,256    64,964    29,611    (37,515)   (106,851)   409,465 
Corporate Investment Banking   3,077,491    8,256,291    248,381    50,457    185,617    10,418    (95,914)   398,959 
Other   (106,740)   2,009,462    (995,602)   10,576    41,654    (467)   (11,482)   (955,321)
Total   40,811,886    29,675,768    1,093,049    502,640    302,455    (322,785)   (876,148)   699,211 
Other operating income                                      3,807 
Other operating expenses and impairment                                      (33,550)
Net income from non-current assets and groups available for sale not admissible as discontinued operations                                      13,154 
Income from investments in associates and other companies                                      8,763 
Net operating income before income tax                                      691,385 
Income tax expense                                      (97,548)
Results of continuing operations                                      593,837 
Results of discontinued operations                                       
Net income for the year                                      593,837 

 

(1)Corresponds to loans and accounts receivable at amortized cost under IFRS 9, without deducting their allowances for loan losses.

 

(2)Corresponds to the sum of personnel salaries and expenses, administrative expenses, depreciation and amortization.

 

38

 

 

Operations through Subsidiaries

 

The General Banking Law permits us to directly provide the leasing and financial advisory services that we could formerly offer only through our subsidiaries, to offer investment advisory services outside of Chile and to undertake activities that we could not formerly offer directly or through subsidiaries, such as factoring, securitization, foreign investment funds, custody and transport of securities and insurance brokerage services. For the twelve–month period ended December 31, 2023, our subsidiaries collectively accounted for 1.6% of our total consolidated assets.

 

      Percent ownership share as of December 31, 
      2023   2022   2021 
Name of the Subsidiary  Main activity  Direct   Indirect   Total   Direct   Indirect   Total   Direct   Indirect   Total 
   (in %)
Santander Corredora de Seguros Limitada  Insurance brokerage   99.75    0.01    99.76    99.75    0.01    99.76    99.75    0.01    99.76 
Santander Corredores de Bolsa Limitada  Financial instruments brokerage   50.59    0.41    51.00    50.59    0.41    51.00    50.59    0.41    51.00 
Santander Asesorias Financieras Limitada  Financial advisory   99.03        99.03    99.03        99.03    99.03        99.03 
Santander S.A. Sociedad Securitizadora  Purchase of credits and issuance of debt instruments   99.64        99.64    99.64        99.64    99.64        99.64 
Klare Corredora de Seguros S.A.  Insurance brokerage   50.10        50.10    50.10        50.10    50.10        50.10 
Santander Consumer Chile S.A.  Financing   51.00        51.00    51.00        51.00    51.00        51.00 
Sociedad operadora de Tarjetas de Pago Santander Getnet Chile S.A.  Card operator   99.99    0.01    100.00    99.99    0.01    100.00    99.99    0.01    100.00 

 

On January 7, 2021, at the Extraordinary Shareholders’ Meeting of Sociedad Operadora de Tarjetas de Pago Santander Getnet Chile S.A., the members were agreed to pay the subscribed and unpaid capital, for an amount of Ch$3,727 million. Santander Asesorias Financieras, made a cash payment of Ch$800 thousand. Banco Santander-Chile made a cash payment of Ch$38 million and also contributing assets valued at Ch$3,689 million. On January 29, 2021, the FMC authorized Sociedad Operadora de Tarjetas de Pago Santander Getnet Chile S.A. to serve as a bank support company and registered the company in the payment card operator’s registry. On March 22, 2021, Getnet’s shareholders modified the company’s bylaws to increase their number of directors from 3 to 5.

 

The following companies have been consolidated based on the determination that they are controlled by the Bank, in accordance with IFRS 10 Consolidated Financial Statements:

 

Santander Gestión de Recaudación y Cobranza Limitada (collection services)

 

Bansa Santander S.A. (management of repossessed assets, auto lending support, and leasing of properties)

 

Multiplica SpA (management of co-branding agreements)

 

The Bank also has significant influence over the following entities:

 

39

 

 

      Place of  Percentage of ownership share as of
December 31,
 
      Incorporation  2023   2022   2021 
Associates  Main activity  and operation      (in %)     
Centro de Compensación Automatizado  Electronic fund transfer and compensation services  Santiago, Chile   33.33    33.33    33.33 
Sociedad Interbancaria de Depósito de Valores S.A.  Delivery of securities on public offer  Santiago, Chile   29.29    29.29    29.29 
Cámara Compensación de Pagos de Alto Valor S.A.  Payments clearing  Santiago, Chile   15.00    15.00    15.00 
Administrador Financiero del Transantiago S.A.  Administration of boarding passes for public transportation  Santiago, Chile   20.00    20.00    20.00 
Servicios de Infraestructura de Mercado OTC S.A.  Administration of the infrastructure for the financial market of derivative instruments  Santiago, Chile   12.48    12.48    12.48 
Redbanc S.A.(1)  ATM services  Santiago, Chile   33.43    33.43    33.43 
Transbank S.A.(1)  Credit and debit card services  Santiago, Chile   25.00    25.00    25.00 

 

(1)In 2021 the Bank re-evaluated the classification of Redbanc and Transbank, due to the time elapsed since those companies were classified as held-for-sale, and the fact that it was not possible to find buyers, due to global economic effects derived from COVID-19 and the current Chilean economic situation. Thus, the Bank has reclassified those investments as Investments in associates and accounted them using the equity method.

 

In the case of Cámara Compensación de Pagos Alto Valor S.A., Banco Santander-Chile has a representative on the Board of Directors. As per the definition of associates, the Bank has concluded that it exerts significant influence over this entity.

 

In the case of Servicios de Infraestructura de Mercado OTC S.A., the Bank actively participates, through its executives, in the administration and in the process of organization, which is why the Administration has concluded that it exerts significant influence over it.

 

In 2018 the Bank announced it was selling its share participation on Redbanc S.A. and Transbank S.A. Accordingly, we classified those investments in accordance to IFRS 5 “Non-current Assets Held for Sale and Discontinued Operations” as investments available for sale. In June 2021 the FMC instructed Santander-Chile to participate in Transbank’s capital increase and therefore in July and September 2021, Santander Chile invested Ch$2,500 million and Ch$4,999 million, respectively, on Transbank’s capital. Since no potential buyers were identified, the Bank has reclassified those investments as investments in associates and accounted using the equity method. The Bank continues to be committed to the sale plan for these assets, actively seeking potential buyers and continuing its plans to develop its own acquiring network, as evidenced by the recent creation of a payment card operating company.

 

Competition

 

Overview

 

The Chilean financial services market consists of a variety of largely distinct sectors. The most important sector, commercial banking, includes a number of privately-owned banks and one public-sector bank, Banco del Estado de Chile (which operates within the same legal and regulatory framework as the private sector banks). The private-sector banks include local banks and a number of foreign-owned banks operating in Chile. The Chilean banking system is comprised of 17 banks, including one public-sector bank. The six largest banks accounted for 87.1% of all outstanding loans by Chilean financial institutions as of December 31, 2023 (excluding assets held abroad by Chilean banks).

 

The Chilean banking system has experienced increased competition in recent years, largely due to consolidation in the industry and new legislation. In January 2024, a merger between Banco BICE and Banco Security was announced, which would result in the 7th largest bank in Chile in terms of loan portfolio. We also face competition from non-bank and non-finance competitors, principally department stores, credit unions and cajas de compensación (private, non-profitable corporations whose aim is to administer social welfare benefits, including payroll loans, to their members) with respect to some of our credit products, such as credit cards, consumer loans and insurance brokerage. In addition, we face competition from non-bank finance competitors, such as leasing, factoring and automobile finance companies, with respect to credit products, and mutual funds, pension funds and insurance companies, with respect to savings products. Our subsidiary, Getnet, also competes against non-banks, such as MercadoPago, in the acquiring market. Currently, banks continue to be the main suppliers of leasing, factoring and mutual funds, and the insurance sales business has grown rapidly.

 

40

 

 

All the competition data in the following sections is based on Chilean Bank GAAP.

 

The following tables set out certain statistics comparing our market position to that of our peer group, defined as the six largest banks in Chile in terms of total loans as of December 31, 2023 or the latest date available (excluding assets held by Chilean banks abroad).

 

   As of December 31, 2023,
unless otherwise noted
 
   Market
Share
   Rank 
Commercial loans   14.7%   3 
Consumer loans   19.7%   1 
Residential mortgage loans   21.2%   1 
Total loans   17.6%   1 
Deposits   17.8%   2 
Checking accounts(1)   25.5%   1 
Branches(1)     16.3%   3 

 

Source: FMC

 

(1)As of November 2023, according to the latest publicly available information.

 

Loans

 

As of December 31, 2023, our loan portfolio was the largest among Chilean banks. Our loan portfolio, including interbank loans, represented 17.6% of the market for loans in the Chilean financial system as of such date. The following table sets forth our and our peer group’s market shares in terms of loans (excluding assets held by Chilean banks abroad).

 

   As of December 31, 2023
(Chilean Bank GAAP)
 
Loans  Ch$ bn   U.S.$ bn   Market Share 
Santander-Chile   40,849    46.7    17.6%
Banco de Chile   37,601    43.0    16.2%
Banco del Estado de Chile   34,863    39.9    15.0%
Banco de Crédito e Inversiones   33,929    38.8    14.6%
Scotiabank Chile   32,106    36.7    13.8%
Itaú Chile   22,926    26.2    9.9%
Others   30,326    34.7    13.0%
Chilean financial system   232,600    266.0      

 

Source: FMC.

 

41

 

 

Deposits

 

We had a 17.8% market share in deposits, ranking second among banks in Chile as of December 31, 2023. Deposit market share is based on total time and demand deposits as of the respective dates. The following table sets forth our and our peer group’s market shares in terms of deposits (excluding assets held by Chilean banks abroad).

 

   As of December 31, 2023
(Chilean Bank GAAP)
 
Deposits  Ch$ bn   U.S.$ bn   Market Share 
Banco del Estado de Chile   33,110    37.9    19.9%
Santander-Chile   29,676    33.9    17.8%
Banco de Chile   28,687    32.8    17.2%
Banco de Crédito e Inversiones   19,937    22.8    12.0%
Scotiabank Chile   18,032    20.6    10.8%
Itaú Chile   13,799    15.8    8.3%
Others   23,114    26.4    13.9%
Chilean financial system   166,356    190.2      

 

Source: FMC.

 

Total Equity

 

As of December 31, 2023, we were the third largest bank in Chile in terms of total equity. The following table sets forth our and our peer group’s total equity.

 

   As of December 31, 2023
(Chilean Bank GAAP)
 
Total Equity  Ch$ bn   U.S.$ bn   Market Share 
Banco de Crédito e Inversiones   6,066    6.9    19.3%
Banco de Chile   5,237    6.0    16.7%
Santander-Chile   4,367    5.0    13.9%
Itaú Chile   3,733    4.3    11.9%
Scotiabank Chile   3,436    3.9    10.9%
Banco del Estado de Chile   3,349    3.8    10.7%
Others   5,252    6.0    16.7%
Chilean financial system   31,440    36.0      

 

Source: FMC.

 

42

 

 

Efficiency

 

As of December 31, 2023, we were the fourth most efficient bank in our peer group. The following table sets forth our and our peer group’s efficiency ratio (defined as operating expenses as a percentage of operating revenue, which is the aggregate of net interest income, fees and income from services (net), net gains from mark-to-market and trading, exchange differences (net) and other operating income (net)) in each case under Chilean Bank GAAP.

 

Efficiency ratio as defined by the FMC  As of
December 31,
2023
(Chilean
Bank GAAP)
 
Banco de Chile   37.3 
Banco del Estado de Chile   38.4 
Scotiabank Chile   42.1 
Santander-Chile   46.6 
Itaú Chile   51.1 
Banco de Crédito e Inversiones   51.7 
Chilean financial system   43.6 

 

Source: FMC.

 

Net Income for the Period Attributable to Equity Holders

 

In 2023, we were the fourth largest bank in Chile in terms of net income attributable to shareholders measured under Chilean Bank GAAP. The following table sets forth our and our peer group’s net income.

 

   As of December 31, 2023
(Chilean Bank GAAP)
 
Net income attributable to equity holders  Ch$ bn   U.S.$ bn   Market Share 
Banco de Chile   1,243,634    1,422    27.7%
Banco de Crédito e Inversiones   682,468    780    15.2%
Banco del Estado de Chile   612,738    701    13.6%
Santander-Chile   496,404    568    11.1%
Scotiabank Chile   407,961    467    9.1%
Itaú Chile   354,887    406    7.9%
Others   691,605    791    15.4%
Chilean financial system   4,489,697    5,134      

 

Source: FMC.

 

Return on equity

 

We were the fourth most profitable bank in our peer group (as measured by return on period-end equity under Chilean Bank GAAP) and the second most capitalized bank as measured by the Chilean BIS ratio as of December 31, 2023 and September 30, 2023 (the last industry available data), respectively. The following table sets forth our and our peer group’s return on average equity and BIS ratio.

 

   Return on
period-end
equity as of
December 31, 2023
(Chilean Bank GAAP)
   BIS Ratio
as of
September 30, 2023
(Chilean Bank GAAP)
 
         
Banco de Chile   23.7    17.7 
Banco del Estado de Chile   18.9    14.0 
Scotiabank Chile   11.7    14.2 
Santander-Chile   11.4    17.1 
Banco de Crédito e Inversiones   11.2    13.2 
Itaú Chile   9.5    15.3 

 

Source: FMC.

 

43

 

 

Asset Quality

 

As of December 31, 2023, we had the fourth lowest non-performing loan to loan ratio in our peer group. The following table sets forth our and our peer group’s non-performing loan ratio as defined by the FMC as of December 31, 2021.

 

   Non-performing
loans / total
loans as of
December 31,
2023 (Chilean Bank GAAP)
 
Banco de Crédito e Inversiones   1.3 
Banco de Chile   1.4 
Scotiabank Chile   2.2 
Santander-Chile   2.3 
Itaú Chile   2.3 
Banco del Estado de Chile   4.0 
Chilean financial system   2.1 

 

Source: FMC

 

Regulation and Supervision

 

General

 

In Chile, only banks may maintain checking accounts for their customers, conduct foreign trade operations, and, together with non-banking financial institutions, accept time deposits. The principal authorities that regulate financial institutions in Chile are the FMC and the Central Bank. Chilean banks are primarily subject to the General Banking Law, and secondarily subject, to the extent not inconsistent with this statute, to the provisions of the Chilean Companies Law governing public corporations, except for certain provisions which that expressly excluded.

 

The modern Chilean banking system dates from 1925 and has been characterized by periods of substantial regulation and state intervention, as well as periods of deregulation. The most recent period of deregulation commenced in 1975 and culminated in the adoption of a series of amendments to General Banking Law. That law was amended in 2001 to grant additional powers to banks, including general underwriting powers for new issues of certain debt and equity securities and the power to create subsidiaries to engage in activities related to banking, such as brokerage, investment advisory and mutual fund services, administration of investment funds, factoring, securitization products and financial leasing services. The most recent amendment to the General Banking Law was introduced by law 21,130, passed in January 2019, which modernizes Chile’s banking legislation by adopting capital and resolution standards in line with the requirements of the Basel Committee.

 

The Central Bank

 

The Central Bank is an autonomous legal entity created by the Chilean Constitution. It is subject to the Chilean Constitution and its own ley orgánica constitucional, or organic constitutional law. To the extent not inconsistent with the Chilean Constitution or the Central Bank’s organic constitutional law, the Central Bank is also subject to private sector laws (but in no event is it subject to the laws applicable to the public sector). It is directed and administered by a Board of Directors composed of five members designated by the President of Chile, subject to the approval of the Chilean Senate.

 

The legal purpose of the Central Bank is to maintain the stability of the Chilean peso and the orderly functioning of Chile’s internal and external payment systems. The Central Bank’s powers include setting reserve requirements, regulating the amount of money and credit in circulation, establishing regulations and guidelines regarding finance companies, foreign exchange (including the Formal Exchange Market) and banks’ deposit-taking activities.

 

44

 

 

According to Article 132 of the General Banking Law, demand deposits and other obligations with unconditional withdrawal rights are 100% guaranteed in the event of forced liquidation of a bank, regardless of whether the depositors are natural or legal persons.

 

Financial Market Commission

 

In 2017, Law 21,000 created the Comisión para el Mercado Financiero or Financial Market Commission (FMC). This law became a Law of the Republic in January 2018. The FMC is the sole supervisor for the Chilean financial system overseeing insurance companies, companies with publicly traded securities, credit unions, credit card and prepaid card issuers, and, as of June 1, 2019, banks. This commission is responsible for ensuring the proper functioning, development and stability of the financial market, facilitating market agents' participation and defending public faith in the financial markets. To do so, it must maintain a general and systemic vision of the market, considering the interests of investors and policyholders. Likewise, it shall be responsible for ensuring that the persons or entities audited, from their initiation until the end of their liquidation, comply with the laws, regulations, statutes and other provisions that govern them.

 

The Commission oversees a Council, which is composed of five members, who are appointed and are subject to the following rules:

 

A commissioner appointed by the President of Chile, of recognized professional or academic prestige in matters related to the financial system, which will have the character of president of the FMC.

 

Four commissioners appointed by the President of Chile, from among persons of recognized professional or academic prestige in matters related to the financial system, by supreme decree issued through the Ministry of Finance, after ratification of the Senate by the four sevenths of its members in exercise, in session specially convened for that purpose.

 

The Council’s responsibilities include regulation, sanctioning and the definition of general supervision policies. In addition, there will be a prosecutor in charge of investigations and the Chairman will be responsible for supervision. The FMC will act in coordination with the Central Bank.

 

The date of entry into operation of the Commission for the Financial Market was December 14, 2017. The Superintendency of Banks and Financial Institutions (SBIF) was eliminated on January 15, 2018 and all functions of this Superintendency were absorbed by the FMC.

 

In January 2019, Law 21,130, which modernized the banking legislation contained in the General Banking Law and amended Law 21,000 (among others), was published in the Official Gazette. The law modernizes Chilean banking regulation in order to comply with Basel III practices and provisions. The law provides for stronger banking capital and reserves requirements in accordance with Basel III guidelines. The law also modernizes the corporate governance function of the FMC and, importantly, transfers the SBIF functions to the domain of the FMC. The FMC now has the faculty to determine the risk weighting of assets through a standardized model to be approved by the FMC or banks can implement their own methodology, subject to approval by the FMC. The law also imposes limitations on dividend distributions and puts in place intervention mechanisms in the event of insolvency.

 

The regulator examines all banks from time to time, generally at least once a year. Banks are also required to submit their financial statements monthly to the FMC, and the banks’ financial statements are published at least four times a year in a newspaper with countrywide coverage. In addition, banks must provide extensive information about their operations at various periodic intervals to the FMC. A bank’s annual financial statements and the opinion of its independent auditors must also be submitted to the FMC.

 

Any person wishing to acquire, directly or indirectly, 10.0% or more of the share capital of a bank must obtain the prior approval of the FMC. Absent such approval, the acquirer of shares so acquired will not have the right to vote. The FMC may only refuse to grant its approval, based on specific grounds set forth in the General Banking Law.

 

According to Article 35 bis of the General Banking Law, the prior authorization of the regulator is required for:

 

the merger of two or more banks;

 

the acquisition of all or a substantial portion of a bank’s assets and liabilities by another bank;

 

45

 

 

the control by the same person, or controlling group, of two or more banks; or

 

a substantial increase in the existing control of a bank by a controlling shareholder of that bank.

 

The intended purchase, merger or expansion may be denied by the regulator with an accompanying resolution recording the specific reasons for denial and with the agreement of a majority of the Board of Directors of the Central Bank.

 

Pursuant to the regulations of the FMC, the following ownership disclosures are required:

 

a bank is required to inform the FMC of the identity of any person owning, directly or indirectly, 5.0% or more of such banks’ shares;

 

holders of ADSs must disclose to the Depositary the identity of beneficial owners of ADSs registered under such holders’ names;

 

the Depositary is required to notify the bank as to the identity of beneficial owners of ADSs which such Depositary has registered and the bank, in turn, is required to notify the FMC as to the identity of the beneficial owners of the ADSs representing 5.0% or more of such banks’ shares; and

 

bank shareholders who individually hold 10.0% or more of a bank’s capital stock and who are controlling shareholders must periodically inform the FMC of their financial condition.

 

Limitations on Types of Activities

 

Chilean banks can only conduct those activities allowed by the General Banking Law: making loans, accepting deposits and, subject to limitations, making investments and performing financial services. Investments are restricted to real estate for the bank’s own use, gold, foreign exchange and debt securities. Through subsidiaries, banks may also engage in other specific financial service activities such as securities brokerage services, equity investments, securities, mutual fund management, investment fund management, financial advisory and leasing activities. Subject to specific limitations and the prior approval of the FMC and the Central Bank, Chilean banks may own majority or non-controlling interests in foreign banks.

 

Deposit Insurance

 

The Chilean government guarantees certain time deposits and savings accounts held by natural persons with a maximum value of UF400 per person (Ch$14.7 million or U.S.$16,829 as of December 31, 2023) per calendar year in the entire financial system and a maximum of UF200 per person per bank (Ch$7.4 million or U.S.$8,414 as of December 31, 2023. Governmental deposit insurance does not cover time deposits or savings account balances for legal entities (including for-profit and non-profit institutions or companies).

 

Reserve Requirements

 

Deposits are subject to a reserve requirement of 9.0% for demand deposits and 3.6% for time deposits (with terms of less than one year). For purposes of calculating the reserve obligation, banks are authorized to deduct daily from their foreign currency denominated liabilities, the balance in foreign currency of certain loans and financial investments held outside of Chile, the most relevant of which include:

 

cash clearance account, which should be deducted from demand deposit for calculating reserve requirement;

 

certain payment orders issued by pension providers; and

 

the amount set aside for “technical reserve” (as described below), which can be deducted from reserve requirement.

 

The Central Bank has statutory authority to require banks to maintain reserves of up to an average of 40.0% for demand deposits and up to 20.0% for time deposits (irrespective, in each case, of the currency in which they are denominated) to implement monetary policy.

 

46

 

 

In addition, to the extent that the aggregate amount of the following types of liabilities exceeds 2.5 times the amount of a bank’s regulatory capital, a bank must maintain a 100% “technical reserve” against them: demand deposits, deposits in checking accounts, or obligations payable on sight incurred in the ordinary course of business, and in general all deposits unconditionally payable immediately, but excluding interbank demand deposits. As of December 31, 2021, the Central Bank required us to maintain an additional technical reserve of Ch$4,272,695 million, representing 15.2% of our demand deposits, due to the strong rise in demand deposits since the beginning of the pandemic. As of December 31, 2023, the Bank was not required to maintain this reserve.

 

Minimum Capital

 

On October 9, 2020, the FMC published the final regulations on regulatory capital to comply with effective net worth rules in accordance with Basel III and General Banking Law. The new regulation became effective on December 1, 2021 and is being gradually implemented and adjusted to be fully in place by December 1, 2025. Pursuant to the proposed regulation, there are three levels of capital: core capital level 1 or CET1 (core capital), additional tier I capital or AT1 (perpetual bonds and preferred stock) and Tier 2 or T2 capital (subordinated bonds and voluntary provisions). Regulatory capital is composed of the sum of CET1, AT and T2 after making some deductions, mainly for intangible assets, hybrid securities issued by foreign subsidiaries, partial deduction for deferred taxes and some reserve and profit accounts. The minimum total regulatory capital is 8% of risk-weighted assets, which includes credit, market, and operational risk. This minimum increases in line with the size, complexity and solvency of a bank and the FMC’s assessment of a bank’s management.

 

According to Chilean regulations regulatory core capital must be as a minimum 4.5% of risk weighted assets (RWA) of a Bank. In addition, and to avoid restrictions on dividend payments, a bank must have an additional conservation buffer of 2.5% of RWA. The conservation buffer will be gradually phased in by 2025 and must be comprised of core capital. The Central Bank may set an additional counter cyclical buffer of up to 2.5% of risk-weighted assets in agreement with the FMC, also comprised of core capital. At the Central Bank’s Financial Policy Meeting, held in the first half of 2023, the Board of the Central Bank of Chile agreed to activate the Countercyclical Capital Buffer (CCyB) for banks, setting it at 0.5% of risk-weighted assets, which must be implemented by May 2024.

 

On November 2, 2020, the FMC published the final guidelines regarding the identification and core capital charge for banks considered Systemically Important Banks (“SIBs”). The FMC, in agreement with the Central Bank, also imposed additional capital requirements for SIBs of between 1-3.5% of risk-weighted assets. This additional capital is being gradually phased in by 25% beginning in December 2021 until December 2025.

 

There are a total of four factors that are weighted to reach a market share:

 

1.Size (weighted at 30%): Includes total assets consolidated in the domestic market.

 

2.Domestic interconnection (weighted at 30%): Includes assets and liabilities with financial institutions (banks and non-banks) and assets in circulation in the Chilean financial market (equity and fixed income).

 

3.Domestic substitution (weighted at 20%): Includes the share in local payments, assets in custody, deposits and loans.

 

4.Complexity (weighted at 20%): Includes factors that could lead to greater difficulties regarding costs and/ or time for the orderly resolution of the Bank. These include the notional amount of OTC derivatives, inter-jurisdictional assets and liabilities and available-for-sale assets.

 

47

 

 

The minimum amount of the sum of the factors to be considered systemic is 1000 bp, equivalent to a weighted participation of 10% of all four factors. The core capital additional charge depends on the size of the total factor, as set out in the table below:

 

Systemic Level   Range (bp)    Core capital additional charge
(% of
risk-weighted
assets)
 
I   1000-1300    1.0%-1.25% 
II   1300-1800    1.25%-1.75% 
III   1800-2000    1.75%-2.5% 
IV   >=2000    2.5%-3.5% 

 

The Central Bank may also require for a SIB: (1) the addition of up to 2% to the core capital to a bank’s total assets ratios; (2) a reduction in the technical reserve requirement trigger from 2.5 times regulatory capital to 1.5 times regulatory capital; and/or (3) a reduction in the interbank loan limit to 20% of regulatory capital of any SIB. Under this framework, we are classified as a Level II SIB with a requirement of maintaining 1.5% of RWA as core capital to fulfill this requirement.

 

Banks must also have at least 1.5% of RWA in Additional Tier 1 capital (AT1), either in the form of preferred shares or perpetual bonds, both of which may be convertible to common equity. The maximum amount of AT1 is set at 1/3 of core capital. As a temporary measure, the FMC permits banks to fulfill their minimum AT1 requirement with Tier II instruments. In October 2021, the Bank issued an AT1 perpetual bond for U.S.$700 million with no fixed maturity and not redeemable before five years from the date of issuance. The bond is convertible to shares if the banks CET1 ratio falls below 5.125% in line with the FMC conditions and requirements for the issuance of perpetual bonds and preferred equity.

 

Tier 2 capital is now set at a minimum of 2% of RWA. Tier 2 includes subordinated bonds and up to the equivalent of 50% of core capital can be considered Tier 2. Additional provision in accordance with the rules of General Banking Law can also be considered Tier 2 in amount up to 1.25% of RWA.

 

The General Banking Law also incorporates Pillar II capital requirements to ensure adequate risk management. This pillar's objective is to ensure that banks maintain capital levels consistent with their risk profile and business model and encourages the development and use of appropriate processes to monitor and manage their risks. Pillar II also granted the regulators the power to impose greater capital requirements as a result of deficient evaluations of a bank’s internal capital adequacy assessment process (ICAAP), which should consider a bank’s risk profile and a strategy to sustain adequate levels of capital, even under stress scenarios. Pillar II also focuses on risks not considered in Pillar 1 such as reputational risks, concentration risks, liquidity risks and interest rate risks. The FMC, with at least four votes from the Council of the FMC, will have the power to impose additional regulatory capital demands of up to 4% of risk-weighted assets, either Tier I or Tier II, if it determines that the previous capital levels and buffers are not enough for a particular financial institution. On January 17, 2024, the FMC stated that banks that had a level of market risk of the banking book greater than 15% of CET1 would have to meet an additional capital requirement under Pillar II guidelines. This additional capital requirement must be implemented by banks gradually, with 25% of the new Pillar II requirement established by June 30, 2024. Following the FMC latest revision of the Bank’s solvency and management, a 0% Pillar II requirement was set in 2024 for the Bank. The FMC also stated that it is considering changing its Pillar II requirements to include more banks or to have a permanent Pillar II requirement for all banks beginning in 2025.

 

In 2023, The CMF introduced Pillar III requirements for Chilean banks. The objective of the Pillar 3 standard is to give the public more transparency to better evaluate the capital situation of each entity. To do this, banking institutions must publish an independent document, referring exclusively to this pillar, which must offer readers a source of prudential parameters, updated according to the periodicity indicated, with all the information disclosure requirements indicated by the regulator.

 

48

 

 

The following table sets forth the regulatory capital demands under the General Banking Law:

 

Minimum capital requirements: Basel III, previous GBL and new requirements
Capital categories   General Banking Law
(% over risk weighted assets)    
(1) Core capital   4.5%
(2) Additional Tier 1 Capital (AT1)   Minimum 1.5% up to 1/3 of core capital
(3) Total Tier 1 Capital (1+2)   6.0%
(4) Tier 2 Capital   Minimum 2.0% with subordinated bonds up to 50% of core capital and additional provisions up to 1.25% of RWAs
(5) Total Regulatory Capital (3+4)   8.0%
(6) Conservation Buffer   2.5% CET1
(7) Total Equity Requirement (5+6)   10.5%
(8) Counter Cyclical Buffer   up to 2.5% CET1. Currently set at 0.5%
(9) SIB Requirement   Between 1 – 3.5% CET1
(10) Pillar 2   Up to 4% CET1 or Tier 2

 

Risk Weightings

 

The Basel Committee on Banking Supervision (BCBS) defines credit risk (CR) as the risk that a debtor or bank counterparty does not meet its obligations in accordance with the agreed terms. Credit risk is the most relevant in the Chilean banking industry. The prior mechanism estimated Risk Weighted Assets by Credit Risk (RWCR) using a methodology based on the Basel I standard. The standard method with Basel III standards is more advanced, since it has categories that depend on the type of counterparty and different risk factors. These categories are not based on accounting criteria, but rather on the underlying risk. Thus, all exposures that have mortgage guarantees, for example mortgage loans for housing, have a different treatment from those exposures not guaranteed by a mortgage. Additionally, in the case of mortgage-backed exposures, there are different types of treatment depending on the type of real estate and whether the obligations are paid with income generated by the property itself. The new framework also allows the use of internal methodologies, subject to compliance with minimum requirements. The new standards for weighing credit risk include the possibility of reducing RWCR when considering credit risk mitigators, such as compensation agreements, guarantees and other compensations.

 

The Basel Committee on Banking Supervision (BCBS) defines operational risk (OR) as the risk of loss resulting from inadequate or failed internal processes, people and systems or from external events. This definition includes legal risk but excludes strategic and reputational that a debtor or bank counterparty does not meet its obligations in accordance with the agreed terms. In order to estimate the operational risk coefficient, two factors are considered:

 

1.The business indicator component (BIC): A component that considers interest income, interest earning assets, dividend income, financial transactions, fees, and other operational income and expenses. These are then multiplied by a marginal coefficient.

 

2.Internal Loss Multiplier (ILM): This component is based on 10 years of historical operational losses, or at least five years in some special cases.

 

BCBS defines market risk (MR) as the risk of losses arising from movements in market prices. The risks subject to market risk capital requirements mainly includes: interest rate risk, credit spread risk, equity risk, foreign exchange (FX) risk and commodities risk for trading book instruments; and FX risk and commodities risk for banking book instruments. The FMC does not permit banks to use internal models for calculating MRWA and instead only permits the usage of simple standardized models.

 

49

 

 

The following table sets forth our RWA and regulatory capital as of December 31, 2023 under Basel III as required by the Chilean regulator as of this reporting date.

 

Risk-weighted assets  December 31,
2023
 
   Ch$ million 
Market risk   4,793,740 
Operational risk   4,424,739 
Credit risk   30,333,749 
Total RWA   39,552,228 

 

       Ratio 
   December 31,
2023
   December 31,
2023
 
   (Ch$ million)   (% of RWA) 
Common Equity Tier 1 (CET1)   4,397,881    11.1%
Additional Tier I   608,721    1.5%
Tier I   5,006,602    12.7%
Tier II   1,972,130    5.0%
Regulatory capital   6,978,732    17.6%

 

We believe our capital levels are adequate, but we cannot rule out having to raise additional capital in the future to maintain our capital adequacy ratios above the minimum required by the FMC.

 

Lending Limits

 

Under the General Banking Law, Chilean banks are subject to certain lending limits, including the following material limits:

 

A bank may not extend to any entity or individual (or any one group of related entities), except for another financial institution, directly or indirectly, unsecured credit in an amount that exceeds 10.0% of the bank’s regulatory capital, or in an amount that exceeds 30.0% of its regulatory capital if the excess over 10.0% is secured by certain assets with a value equal to or higher than such excess. In the case of financing infrastructure projects built by government concession, the 10.0% ceiling for unsecured credits is raised to 15.0% if secured by a pledge over the concession, or if granted by two or more banks or finance companies which have executed a credit agreement with the builder or holder of the concession in the case of export loans in foreign currency the ceiling is raised to 30%;

 

a bank may not extend loans to another financial institution subject to the General Banking Law in an aggregate amount exceeding 30.0% of its regulatory capital;

 

a bank may not grant loans to a single business group, as defined in Title XV of Law 18,045, that exceeds 30% of the Bank’s regulatory capital, provided that such limit excludes interbank loans;

 

if a bank originates a loan in excess of these limits, a fine equivalent to 10% of the excess will be applied to the bank;

 

a bank may not directly or indirectly grant a loan whose purpose is to allow an individual or entity to acquire shares of the lender bank;

 

a bank may not lend, directly or indirectly, to a director or any other person who has the power to act on behalf of the bank; and

 

a bank may not grant loans to related parties (including holders of more than 1.0% of its shares) on more favorable terms than those generally offered to non-related parties. Loans granted to related parties are subject to the limitations described in the first bullet point above. In addition, the aggregate amount of loans to related parties may not exceed a bank’s regulatory capital.

 

In addition, the General Banking Law limits the aggregate amount of loans that a bank may grant to its employees to 1.5% of its regulatory capital and provides that no individual employee may receive loans in excess of 10.0% of this 1.5% limit. Notwithstanding these limitations, a bank may grant each of its employees a single residential mortgage loan for personal use during such an employee’s term of employment.

 

50

 

 

Allowance for Loan Losses under Chilean Bank GAAP

 

Chilean banks are required to provide to the FMC detailed information regarding their loan portfolio on a monthly basis. The FMC examines and evaluates each financial institution’s credit management process, including its compliance with the loan classification guidelines. Banks are classified into four categories: 1, 2, 3 and 4. Each bank’s category depends on the models and methods used by the bank to classify its loan portfolio, as determined by the FMC. Category 1 banks are those banks whose methods and models are satisfactory to the FMC. Category 1 banks will be entitled to continue using the same methods and models they currently have in place. A bank classified as a category 2 bank will have to maintain the minimum levels of reserves established by the FMC while its Board of Directors will be made aware of the problems detected by the FMC and required to take steps to correct them. Banks classified as categories 3 and 4 will have to maintain the minimum levels of reserves established by the FMC until they are authorized by the FMC to do otherwise.

 

Differences between IFRS and Chilean Bank GAAP

 

Chilean Bank GAAP, as prescribed by the Compendium of Accounting Standards (the “Compendium”), differs in certain respects from IFRS. The main differences that should be considered by an investor are the following:

 

Suspension of Income Recognition on Accrual Basis

 

In accordance with the Compendium, financial institutions must suspend recognition of income on an accrual basis in their statements of income for certain loans included in the impaired portfolio. IFRS 9 does not allow the suspension of accrual of interest on financial assets for which an impairment loss has been determined. Under IFRS 9, interest income is calculated by applying the effective interest rate to the gross carrying amount of financial assets, except for financial assets that have subsequently become credit-impaired (or “Stage 3”), for which interest revenue is calculated by applying the effective interest rate to their amortized cost (i.e., net of ECL provision). Off-balance interests are recorded as interest income only if related payments are received. This difference does not materially impact our Audited Consolidated Financial Statements.

 

Charge-offs and Accounts Receivable

 

The Compendium requires companies to establish deadlines for the charge-off of loans and accounts receivable. IFRS does not require any such deadline for charge-offs. A charge-off due to impairment would be recorded, if and only if, all efforts at collection of the loan or account receivable had been exhausted. Accordingly, this difference does not materially impact our Audited Consolidated Financial Statements.

 

Assets Received in Lieu of Payment

 

The Compendium requires that the initial value of assets received in lieu of payment be the value agreed upon with a debtor as a result of the loan settlement or the value awarded in an auction, as applicable. These assets are required to be written off one year after their acquisition, if the assets have not been previously disposed of. IFRS requires that assets received in lieu of payment be initially accounted for at fair value. Subsequently, asset valuation depends on the classification provided by the entity for that type of asset. No deadline is established for charging-off an asset. The Bank has adjusted the Audited Consolidated Financial Statements accordingly.

 

Loan Loss Allowances

 

According to both Chilean Bank GAAP and IFRS, loan loss allowances are calculated using expected loss models. The main difference between Chilean Bank GAAP and IFRS 9 regarding loan loss allowances is that loan loss allowances under Chilean GAAP are calculated using expected loss models based on specific guidelines set by the FMC. The models adopted with IFRS 9 use an expected loss approach, however these are not in accordance with specific guidelines under Chilean Bank GAAP given by the FMC. The FMC has not adopted the IFRS 9 Impairment chapter and therefore the Bank has adjusted the Audited Consolidated Financial Statements to fully comply with IFRS standards.

 

Provisions for Country Risk and for Contingent Loan Risk

 

Under Chilean Bank GAAP, the Bank provisions for country risk to cover the risk taken when holding or committing resources with any foreign country. These allowances are established according to country risk classifications established by the FMC and therefore are not in accordance with IFRS. Our provisions for country risk as of December 31, 2023 were not material.

 

Also under Chilean Bank GAAP, the Bank has established allowances related to the undrawn available credit lines and contingent loans in accordance with the FMC. Under IFRS 9, provisions for contingent loans are calculated based on expected credit loss. The Bank has adjusted the Audited Consolidated Financial Statements accordingly.

 

51

 

 

These differences do not have a material impact on our financial statements.

 

Mark-to-market of debt instruments at amortized cost

 

In the past years and in response to the pandemic the Chilean government rolled out a series of measures to increase liquidity for households as well as passing a law that enabled Chileans to make up to three withdrawals from their pension fund. See “Item 5. Operating and Financial Review and Prospects—A. Operating Results—Chilean Economy” for more information. The increased liquidity of our clients led to an increase in demand deposits that surpassed the technical reserve threshold defined by the Central Bank as 2.5 times the Bank’s regulatory capital. Therefore, the Bank was required to maintain a 100% reserve requirement in the Central Bank for any deposit unconditionally payable immediately that surpassed this threshold. This reserve requirement may also be composed of notes issued by the Central Bank. Additionally, in 2020 and 2021 the Central Bank issued low-cost Central Bank Credit lines (FCIC), whereby banks had to provide eligible collateral to access these lines. The eligible collateral included debt instruments issued by the Central Bank and the Chilean Treasury. Due to exceptional changes arising in the liquidity market, the Bank created a new business model “Held-to-collect” whose objective is to properly manage the prevailing high level of liquidity, and maintain the required reserves and collateral. As a result, the Bank reclassified a portion of the portfolio of high rated Central Bank bonds from debt instruments at fair value through other comprehensive income to debt instruments at amortized cost that matched the estimated duration of our excess technical reserves and the duration of the FCIC lines with the Central Bank.

 

Under IFRS 9, the financial asset is reclassified at its fair value at the reclassification date, and the cumulative gain or loss previously recognized in other comprehensive income is removed from equity. As a result, the financial asset is measured at the reclassification date as if it had always been measured at amortized cost and the cumulative gain or loss previously recognized in OCI is removed from equity and applied against the fair value of the financial asset at the reclassification date.

 

Perpetual bonds

 

The Bank has classified the perpetual bonds it has issued as other equity instruments issued other than capital in accordance with IFRS, with interest being recognized in interest expense in the consolidated statement of income. Under Chilean Bank GAAP these instruments are recognized as liabilities under the line item issued regulatory capital financial instruments, with interest recognized in equity.

 

Deferred taxes

 

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. Due to the adjustments made to our consolidated financial statements for the differences between Chilean Bank GAAP and IFRS, we adjust deferred taxes accordingly.

 

Provision for Mandatory Dividends

 

This provision is made in accordance with the Bank’s internal policy and Article 79 of the Chilean Companies Law, pursuant to which at least 30% of net income for the period is distributed, except in the case of a contrary resolution adopted at the respective shareholders’ meeting by unanimous vote of the outstanding shares. While the Bank uses the same policy under Chilean Bank GAAP and IFRS, the net income used to calculate the provision is adjusted in accordance with IFRS principles. However, for the distribution of dividends, the Bank uses the net income according to Chilean Bank GAAP.

 

Capital Markets

 

Under the General Banking Law, banks in Chile may purchase, sell, place, underwrite and act as paying agents with respect to certain debt securities. Likewise, banks in Chile may place and underwrite certain equity securities. Bank subsidiaries may also engage in debt placement and dealing, equity issuance advice and securities brokerage, as well as in financial leasing, mutual fund and investment fund administration, investment advisory services and merger and acquisition services. These subsidiaries are regulated by the FMC.

 

52

 

 

Legal Provisions Regarding Banking Institutions with Economic Difficulties

 

Article 112 of the General Banking Law provides that if specified adverse economic circumstances exist at any bank, its Board of Directors must approve a financing plan to correct the situation and present it to the FMC. In its proposal, the bank must state the scheduled time within which the plan will be completed, which may not exceed 6 months. If one of the measures contained in the financing plan is to increase the capital of the bank by the amount necessary to return the bank to financial stability, the Board of Directors must call a special shareholders’ meeting to the capital increase. If the shareholders reject the capital increase, the FMC may apply one or more of the restrictions stated in Article 116 of the General Banking Law for a period not exceeding 6 months, which may be renewed once for the same period. These restrictions include limiting the bank’s ability to grant loans to any person or legal entity linked (directly or through third parties) to the property or management of the bank, limiting loan renewals for more than 180 days, limiting security documents governing existing loans, among others.

 

If the approval of shareholders is required for a different measure included in the plan, the Board of Directors must call the shareholders’ meeting within 15 days. The General Banking Law provides that the bank may receive a three-year term loan from one or more banking institutions. The terms and conditions of such a loan must be approved by the directors of both banks, as well as by the FMC, but need not be submitted to any institution’s shareholders for their approval. In any event, a creditor bank cannot grant interbank loans to an insolvent bank in an amount exceeding 25.0% of the creditor bank’s regulatory capital. If the bank is unable to pay the loan to its creditors, article 115 of the General Banking Law provides that a bank’s unpaid debt may be: (i) capitalized in a merger between the bank and creditor bank, where the creditor bank may establish the terms and conditions of the merger provided such terms and conditions are approved by the FMC; (ii) used to complete a capital increase agreed by the bank, provided that the shares are issued by a third party; and (iii) to subscribe and pay a capital increase. The shares acquired by the creditor bank must be sold within a period of 180 days, which can be extended by the FMC for a further 180 days.

 

Dissolution and Liquidation of Banks

 

The FMC may establish that a bank should be liquidated for the benefit of its depositors or other creditors when such bank does not have the necessary solvency to continue its operations. In such case, the FMC must revoke a bank’s authorization to exist and order its mandatory liquidation, subject to agreement by the Central Bank. The FMC must also revoke a bank’s authorization if the reorganization plan of such bank has been rejected twice. The resolution by the FMC must state the reason for ordering the liquidation and must name a liquidator, unless the FMC assumes this responsibility. When a liquidation is declared, all checking accounts and other demand deposits received in the ordinary course of business are required to be paid by using existing funds of the bank, its deposits with the Central Bank or its investments in instruments that represent its reserves. If these funds are insufficient to pay these obligations, the liquidator may seize the rest of the bank’s assets, as needed. If necessary and in specified circumstances, the Central Bank will lend the bank the funds necessary to pay these obligations. Any such loans are preferential to any claims of other creditors of the liquidated bank.

 

On January 12, 2019, Law No. 21,130 was published in the Official Gazette of Chile. The law modernizes banking legislation including the General Banking Law by, among other things, transferring the supervisory powers of the Superintendency of Banks and Financial Institutions (SBIF) to the FMC, updating the capital and risk management requirements applicable to banking companies in accordance with the Basel III standards, and introducing measures for the early regularization and intervention of banking companies that are at risk of insolvency.

 

With respect to measures for early regularization, Law No. 21,130 establishes an obligation on banks to inform the FMC if any of the regulatory non-compliance situations listed in Article 112 of the General Banking Law arise or if it has detected any event indicative of financial instability or deficient administration. Within five days of notifying the FMC, the bank must present a regularization plan approved by its board of directors containing concrete measures that shall remedy the relevant situation and ensure the bank’s normal performance. The bank must comply with the regularization plan within 6 months of the resolution approving it. During the implementation of the plan, the bank must also submit periodic reports on its progress to the FMC, and the FMC may require the implementation of additional measures and/or prohibitions it deems necessary for the plan’s success.

 

53

 

 

Article 161 of the General Banking Law provides that directors, managers, administrators and attorneys-in-fact who, without written authorization from the FMC, agree to, perform or cause the execution of any of the acts prohibited under Article 116 of the General Banking Law shall be imprisoned for a term within the medium to maximum range. If a bank fails to submit the regularization plan, the plan is rejected by the FMC, the bank fails to comply with any of the measures set out in the plan, the bank repeatedly breaches the plan’s terms or is subject to fines, or if any serious event occurs that raises concerns for the bank’s financial stability, the FMC may appoint a delegated inspector, who shall have powers to, among other things, suspend any agreement of the board of directors or act of the attorneys-in-fact of the institution, and/or a provisional administrator, who shall have all the ordinary faculties that the law and the by-laws provide for the board of directors, or whoever acts in its place, and for the general manager.

 

Other amendments incorporated by Law No. 21,130 include the elimination of creditors’ agreements as a mechanism for regularizing a bank’s financial situation, the incorporation of modifications to financial system capitalization and preventive capitalization, and the incorporation of further requirements for bank directors.

 

Obligations Denominated in Foreign Currencies

 

Santander-Chile must also comply with various regulatory and internal limits regarding exposure to movements in foreign exchange rates (See “Item 11. Quantitative and Qualitative Disclosures About Market Risk”).

 

Foreign Loans and Investments in Foreign Securities

 

Under current Chilean banking regulations, banks in Chile may grant loans to foreign individuals and entities and invest in certain securities of foreign issuers. Chapter 3 Section B.5-3 and Section B.5-4 of the Central Bank’s Financial Norms regulate a bank’s investment in foreign loans and investment in foreign securities. Banks in Chile may invest in debt securities traded in formal secondary markets. Such debt securities must be (1) securities issued or guaranteed by foreign sovereign states or their central banks or other foreign or international financial entities, and (2) bonds issued by foreign companies. If the sum of investment in foreign securities and loans granted outside of Chile surpasses 70.0% of regulatory capital, the amount that exceeds 70.0% is subject to a mandatory loan loss reserve of 100%.

 

Table 1

 

Rating Agency  Short Term  Long Term
Moody’s  P2  Baa3
Standard and Poor’s  A3  BBB-
Fitch  F2  BBB-
Dominion Bond Rating (DBRS)  R-2  BBB (low)

 

In the event that the sum of: (a) loans granted abroad that are not to subsidiaries of Chilean companies, and that have a rating of BB- or less and do not trade on a foreign stock exchange, and (b) the investments in foreign securities which have a rating that is below that indicated in Table 1 above, but is equal to or exceeds the ratings mentioned in the Table 2 below and exceeds 20.0% (and 30.0% for banks with a BIS ratio equal or exceeding 10% of the regulatory capital of such bank), the excess is subject to a mandatory loan loss reserve of 100%.

 

Table 2

 

Rating Agency  Short Term  Long Term
Moody’s  P2  Ba3
Standard and Poor’s  A-2  BB-
Fitch  F2  BB-
DBRS  R-2  BB (low)

 

In addition, banks may invest in foreign securities whose ratings are equal to or exceed those mentioned in Table 3 below for an additional amount equal to 70% of their regulatory capital. This limit constitutes an additional margin and is not subject to the 100% mandatory reserve.

 

54

 

 

Additionally, a Chilean bank may invest in foreign securities whose rating is equal to or exceeds those mentioned in Table 3 below in: (i) demand deposits with foreign banks, including overnight deposits in a single entity; and (ii) securities issued or guaranteed by sovereign states or their central banks or securities issued or guaranteed by foreign entities within the Chilean State, though investment will be subject to the limits by issuer up to 30.0% and 50.0%, respectively, of the regulatory capital of the Chilean bank that makes the investment. If these foreign securities do not have a rating, the individual limit will be 10.0% of regulatory capital.

 

Table 3

 

Rating Agency  Short Term  Long Term
Moody’s  P1  Aa3
Standard and Poor’s  A1+  AA-
Fitch  F1+  AA-
DBRS  R-1 (high)  AA(low)

 

Moreover, the sum of all demand deposits with foreign banks, including overnight deposits to related parties, as defined by the Central Bank and the FMC cannot surpass 25.0% of a bank’s regulatory capital. This limit excludes foreign branches of Chilean banks or their subsidiaries but must include amounts deposited by these entities in related parties abroad. Banks may grant commercial loans and foreign trade loans and can buy loans granted by banks abroad. Chilean banks may only invest in equity securities of foreign banks and certain other foreign companies which may be affiliates of the bank or which would be complementary to the bank’s business if such companies were incorporated in Chile.

 

United States Supervision and Regulation

 

Financial Regulatory Reform

 

Santander-Chile is a subsidiary of Santander Spain, a foreign banking organization (“FBO”) with operations in the United States. As a subsidiary of Santander Spain, Santander-Chile is subject to certain U.S. financial regulatory laws and rules. In addition to regulations, the U.S. financial regulatory agencies may issue policy statements, interpretive letters and similar written guidance.

 

Financial regulatory statutes and rules are continually under review by the U.S. Congress and U.S. financial regulatory agencies. Under the current U.S. administration, banking organizations, including large FBOs, may become subject to increased scrutiny and more extensive legal and regulatory requirements than under the prior presidential and congressional regime. In addition, changes in key personnel at the agencies that regulate such banking organizations, including the federal banking regulators, including due to any changes to the U.S. administration that may result from the 2024 U.S. presidential election, may result in differing interpretations of existing rules and guidelines and potentially more stringent enforcement and more severe penalties than previously.

 

Volcker Rule

 

Owing to its status as a subsidiary of an FBO, Santander-Chile is subject to Section 13 of the U.S. Bank Holding Company Act and its implementing rules (collectively, the “Volcker Rule”). The Volcker Rule prohibits “banking entities” from engaging in certain forms of proprietary trading or from sponsoring or investing in “covered funds,” in each case subject to certain exceptions. The Volcker Rule also limits the ability of banking entities and their affiliates to enter into certain transactions with covered funds with which they or their affiliates have certain relationships. The Group has adopted processes to establish, maintain, enforce, review and test the compliance program designed to achieve and maintain compliance with the Volcker Rule. The Volcker Rule contains exclusions and certain exemptions for, among others, market-making, hedging, underwriting, trading in U.S. government and agency obligations and certain foreign government obligations, and trading solely outside the United States, and also permits certain ownership interests in certain types of funds to be retained. Santander Spain’s non-U.S. banking organization subsidiaries, including Santander-Chile, are largely able to continue their activities outside the United States in reliance on the “solely outside the U.S.” exemptions from the Volcker Rule. Those exemptions generally exempt proprietary trading, and sponsoring or investing in covered funds if, among other restrictions, the essential actions take place outside the United States.

 

55

 

 

Santander Spain will continue to monitor Volcker Rule-related developments and assess their impact on its operations, including those of Santander-Chile, as necessary.

 

Other U.S. Financial Regulations

 

Santander Spain is subject to other U.S. financial regulatory regimes that do not directly apply to Santander-Chile based on the current scope of its operations. For example, Santander Spain, as a Category IV FBO, and Santander Holdings USA, Santander Spain’s U.S. intermediate holding company (“IHC”), as a Category IV IHC, are subject to enhanced prudential standards imposed by the Board of Governors of the Federal Reserve System (the “Federal Reserve Board”) on large banking organizations that exceed certain asset thresholds. Enhanced prudential standards include risk-based and leverage capital requirements, liquidity requirements, risk management and governance requirements, capital planning and stress testing requirements, resolution planning requirements, and risk management requirements. Category IV institutions are subject to the least exacting level of enhanced prudential standards.

 

In addition, Santander Spain is provisionally registered as a non-US swap dealer with the CFTC and is conditionally registered as a non-US security-based swap dealer with the SEC. As such, Santander Spain is subject to certain clearing, exchange trading, uncleared swap margin, business conduct, reporting and other requirements.

 

U.S. Anti-Money Laundering, Anti-Terrorist Financing, and Foreign Corrupt Practices Act Regulations

 

Santander-Chile, as a foreign private issuer whose securities are registered under the U.S. Securities Exchange Act of 1934, is subject to the U.S. Foreign Corrupt Practices Act (the “FCPA”). The FCPA generally prohibits such issuers and their directors, officers, employees and agents from using any means or instrumentality of U.S. interstate commerce in furtherance of any offer or payment of money to any foreign official or political party for the purpose of influencing a decision of such person in order to obtain or retain business. It also requires that the issuer maintain books and records and a system of internal accounting controls sufficient to provide reasonable assurance that accountability of assets is maintained, and accurate financial statements can be prepared. Penalties, fines and imprisonment of Santander-Chile’s officers and/or directors can be imposed for violations of the FCPA.

 

Furthermore, Santander-Chile is subject to a variety of U.S. anti-money laundering and anti-terrorist financing laws and regulations, such as the Bank Secrecy Act of 1970, as amended, and the USA PATRIOT Act of 2001, as amended, and a violation of such laws and regulations may result in substantial penalties, fines and imprisonment of Santander-Chile’s officers and/or directors.

 

The Anti-Money Laundering Act of 2020 (“AML Act”), enacted on January 1, 2021 as part of the National Defense Authorization Act, does not directly impose new requirements on banks, but requires the U.S. Treasury Department to issue National Anti-Money Laundering and Countering the Financing of Terrorism Priorities, and conduct studies and issue regulations that may, over the next few years, significantly alter some of the due diligence, recordkeeping and reporting requirements that the Bank Secrecy Act and Patriot Act impose on banks. The AML Act also contains provisions that promote increased information-sharing and use of technology, and increases penalties for violations of the Bank Secrecy Act and includes whistleblower incentives, both of which could increase the prospect of regulatory enforcement.

 

Disclosure pursuant to Section 219 of the Iran Threat Reduction and Syria Human Rights Act

 

Pursuant to Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012, which added Section 13(r) to the Securities Exchange Act of 1934, as amended (the “Exchange Act”), an issuer is required to disclose in its annual or quarterly reports, as applicable, whether it or any of its affiliates knowingly engaged in certain activities, transactions or dealings relating to Iran or with individuals or entities designated pursuant to certain Executive Orders. Disclosure is generally required even where the activities, transactions or dealings were conducted in compliance with applicable law.

 

56

 

 

The following activities are disclosed in response to Section 13(r) with respect to the Group and its affiliates. During the period covered by this report:

 

a)Santander UK holds seven blocked accounts for five customers that are currently designated by the U.S. under the Specially Designated Global Terrorist (SDGT) sanctions programme. Revenues and profits generated by Santander UK on these accounts in the year ended December 31, 2023 were negligible relative to the overall profits of Banco Santander S.A.

 

b)Santander Consumer Finance, S.A. holds through its Belgian branch seven blocked correspondent accounts for an Iranian bank that is currently designated by the U.S. under the Specially Designated Global Terrorist (SDGT) sanctions programme. The accounts have been blocked since 2008. No revenues or profits were generated by the Belgian branch on these accounts in the year ended December 31, 2023.

 

c)Banco Santander (Brasil) S.A. (Santander Brasil) holds three blocked accounts for three customers with domicile in Brazil designated by the U.S. under the Specially Designated Global Terrorist (SDGT) sanctions program. Revenues and profits generated by Santander Brasil on these accounts in the year ended December 31, 2023 were negligible relative to the overall profits of Banco Santander S.A.

 

d)The Group also has certain legacy performance guarantees for the benefit of an Iranian bank that is currently designated by the U.S. under the Specially Designated Global Terrorist (SDGT) sanctions programme (stand-by letters of credit to guarantee the obligations – either under tender documents or under contracting agreements – of contractors who participated in public bids in Iran) that were in place prior to April 27, 2007.

 

In the aggregate, all of the transactions described above resulted in gross revenues and net profits in the year ended December 31, 2023 which were negligible relative to the overall revenues and profits of Banco Santander, S.A. The Group has undertaken significant steps to withdraw from the Iranian market such as closing its representative office in Iran and ceasing all banking activities therein, including correspondent relationships, deposit taking from Iranian entities and issuing export letters of credit, except for the legacy transactions described above. The Group is not contractually permitted to cancel these arrangements without either (i) paying the guaranteed amount (in the case of the performance guarantees), or (ii) forfeiting the outstanding amounts due to it (in the case of the export credits). As such, the Group intends to continue to provide the guarantees and hold these assets in accordance with company policy and applicable laws.

 

C.Organizational Structure

 

Santander Spain controls Santander-Chile through its holdings in Teatinos Siglo XXI Inversiones S.A. and Santander Chile Holding S.A. which are controlled subsidiaries. Santander Spain control over 67.18% of our shares and actual participation when excluding non-controlling interests participating in Santander Chile Holding S.A. of 67.13%.

 

Shareholder  Number of
Shares
   Percentage 
Santander Chile Holding S.A.   66,822,519,695    35.46 
Teatinos Siglo XXI Inversiones S.A.   59,770,481,573    31.72 

 

57

 

 

The chart below sets forth the names and areas of responsibility of our senior managers as of the date of the filing of this annual report:

 

 

D.Property, plants and equipment

 

We are domiciled in Chile and own our principal executive offices located at Bandera 140, 20th floor, Santiago, Chile. As of December 31, 2023, we owned the locations at which 28.7% of our branches were located. The remaining branches operate at rented locations. We believe that our existing physical facilities are adequate for our needs.

 

Main Properties as of December 31, 2023  Number 
Central Offices     
Owned   4 
Rented   5 
Total   9 
      
Branches     
Owned   71 
Rented   176 
Total   247 
      
Other property(1)     
Owned   18 
Rented   27 
Total   45 

 

(1)Consists mainly of parking lots, mini-branches and property owned by our subsidiaries.

 

ITEM 4A. UNRESOLVED STAFF COMMENTS

 

None.

 

58

 

 

ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS

 

Accounting Standards Applied in 2023

 

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.

 

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.

 

59

 

 

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.

 

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.

 

60

 

 

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.

 

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.

 

61

 

 

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 2020, the Chilean economy suffered due to the COVID-19 pandemic with extensive lockdowns in place, which led to an economic contraction of 6.1% in 2020. During 2021, the Chilean economy started to recover as the extensive lockdowns where lifted and consumption was strongly boosted by the pension fund withdrawals and other support measures given by the government. In 2021, GDP grew 11.7%, but the measures implemented by the government to increase liquidity for households during the COVID-19 pandemic led to an increase in inflation, with inflation reaching 7.2% in 2021 and 12.8% in 2022, based on the Chilean consumer price index. As a result, the Central Bank increased the MPR multiple times, from a historically low level of 0.5% in 2020 to a historically high level of 11.25% in October 2022. In 2023, inflation began to subside and decreased to 3.9% by the end of the year, based on the Chilean consumer price index. As a result, the Central Bank began easing monetary policy and reduced the MPR to 8.25% as of December 31, 2023.

 

In 2022 GDP grew 2.4% and is expected to have decreased by 0.2% in 2023 mainly due to the high interest rate environment in place both in Chile and globally. The current Central Bank forecast is that GDP will expand between 1.25%-2.25% in 2024. Due to the low growth rate of the economy, the unemployment rate for 2023 was 8.7% as of November 2023, the latest figure available, up from 7.9% as of December 31, 2022.

 

The exchange rate depreciated by 19.9% in 2021, appreciated by 0.5% in 2022 and depreciated by 2.9% in 2023. The depreciation of the Chilean peso in 2023 was mainly due to the rising U.S. yield curve.

 

Total loans as of December 31, 2023, in the Chilean financial system, excluding loans held abroad by Chilean banks, grew 3.2% year-over-year. Total customer deposits (defined as time deposits plus checking accounts), excluding amounts held by Chilean banks abroad, increased 1.6% year-over-year as of December 31, 2023. The non-performing loans (defined as loans with an installment that is at least 90 days past-due) to total loans ratio increased from 1.7% as of December 31, 2022 to 2.1% as of December 31, 2023 as the high interest environment and higher unemployment caused a deterioration of asset quality.

 

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$36,789.36 as of December 31, 2023, Ch$35,110.98 as of December 31, 2022, Ch$30,991.74, and as of December 31, 2021. 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 4.8% in 2023, 13.3% in 2022, and 6.6% in 2021. 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, but there are significantly less features in deposits and other funding sources that would increase the size of our funding base), 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.

 

62

 

 

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$1,147,193 million in 2023, a loss of Ch$1,755,795 million in 2022, and a loss of Ch$429,759 million in 2021. These larger losses in 2023 and 2022 were mainly due to higher short-term interest rates which negatively affected fixed rate liabilities swapped to short-term rates. The average gap between our interest earnings assets and total liabilities linked to the inflation, including hedging, was Ch$6,875,280 million in 2023, Ch$7,849,843 million in 2022 and Ch$6,252,221 million in 2021. Therefore, our sensitivity to a 100-basis point shift in UF inflation considering our average gap in 2023 would be approximately Ch$69 billion.

 

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 
   2023   2022   2021   2023/2022   2022/2021 
   (in millions of Ch$)         
Impact of inflation on net interest income                    
Results from UF GAP(1)   321,698    1,015,855    410,249    (68.3)%   147.6%
Annual UF inflation   4.8%   13.3%   6.6%          

 

(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.

 

The lower result in 2023 compared to 2022 was mainly due to lower inflation in UFs.

 

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 29.0%, 32.0% and 38.9%, for the years ended December 31, 2023, 2022 and 2021, respectively.

 

63

 

 

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 depreciated 2.9% in 2023, appreciated 0.6% in 2022 and depreciated 19.9% in 2021. 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 no 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 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.

 

64

 

 

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.

 

   2023   2022 
CONSOLIDATED RATIOS        
(IFRS)        
Profitability and performance:        
Net interest margin(1)   2.0%   3.1%
Return on average total assets(2)   0.9%   1.2%
Return on average equity(3)   12.3%   22.5%
           
Capital:          
Average shareholders’ equity as a percentage of average total assets(4)   6.8%   5.14%
Total liabilities as a multiple of equity(5)   12.3    12.8 
Credit Quality:          
Non-performing loans as a percentage of total loans(6)   2.26%   1.85%
Allowance for loan losses as percentage of total loans(7)   2.8%   3.0%
Operating Ratios:          
Operating expenses /operating revenue(8)   47.3%   43.3%
Operating expenses /average total assets   1.3%   1.4%
           
OTHER DATA          
CPI Inflation Rate(12)   3.9%   12.8%
Revaluation (devaluation) rate (Ch$/U.S.$) at year end(9)   (2.9)%   0.5%
Number of employees at period end   9,229    9,389 
Number of branches and offices at period end   247    286 

 

(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)This ratio is calculated using total average shareholders’ equity (as presented in “Item 5. Operating and Financial Review and Prospects—C. Selected Statistical Information”).

 

(5)Liabilities and equity divided by equity including non-controlling interest.

 

(6)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 2023 and 2022 correspond to loans at amortized cost.

 

(7)Allowance for loan losses as of December 31, 2023 and 2022 corresponds to allowances for loans at amortized cost according to IFRS 9.

 

(8)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.

 

(9)Based on the interbank market rate published by Reuters at 1:30 pm on the last business day of the period.

 

65

 

 

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, 2023 and 2022

 

In this section, we discuss the results of our operations for the year ended December 31, 2023 compared to the year ended December 31, 2022. For a discussion of the results of our operations for the year ended December 31, 2022 compared to the year ended December 31, 2021, please refer to “Item 5. – A. Operating Results – Results of Operations for the Year Ended December 31, 2022 Compared to the Year Ended December 31, 2021” in our Annual Report on Form 20-F for the year ended December 31, 2022.

 

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, 2023 and 2022.

 

66

 

 

Consolidated Income Statement Data IFRS

 

   2023   2023   2022   % Change
2023/2022
 
   (U.S.$ thousands)(1)   (Ch$
million)
 
                 
Interest income and inflation   5,036,298    4,403,991    4,086,656    7.8%
Interest expense and inflation   (3,786,314)   (3,310,942)   (2,516,544)   31.6%
Net interest income   1,249,984    1,093,049    1,570,112    (30.4)%
Fees and commission income   970,339    848,513    729,063    16.4%
Fees and commission expense   (395,532)   (345,873)   (321,794)   7.5%
Total net fees and commission income   574,807    502,640    407,269    23.4%
Net income/(expense) from financial assets and liabilities for trading   104,936    91,761    78,191    17.4%
Net income from derecognizing financial assets and liabilities at amortized cost and financial assets at fair value through other comprehensive income   (138,297)   (120,934)   (1,628)   7328.4%
Net income from exchange, adjustment and hedge accounting of foreign exchange   379,242    331,628    140,615    135.8%
Net income from financial operations   345,881    302,455    217,178    39.3%
Income from investments in associates and other companies   10,021    8,763    10,310    (15.0)%
Net income from non-current assets and groups available for sale not admissible as discontinued operations   15,043    13,154    8,518    54.4%
Other operating income   4,354    3,807    5,539    (31.3)%
Total operating income   2,200,090    1,923,868    2,218,926    (13.3)%
Personnel salaries and expenses   (471,468)   (412,275)   (414,808)   (0.6)%
Administrative expenses   (366,071)   (320,111)   (310,219)   3.2%
Depreciation and amortization   (164,403)   (143,762)   (129,993)   10.6%
Impairment of property, plant and equipment   (2,187)   (1,912)       —% 
Other operating expenses   (36,180)   (31,638)   (106,306)   (70.2)%
Total operating expenses   (1,040,309)   (909,698)   (961,326)   (5.4)%
Net operating income before credit losses   1,159,781    1,014,170    1,257,600    (19.4)%
Provisions for loan losses for interbank loans and account receivable from customers   (518,564)   (453,458)   (441,396)   2.7%
Provisions for loan losses for contingent loans and others   27,861    24,363    (5,189)   (569.5)%
Recovery of loans previously charged-off   122,442    107,069    90,577    18.2%
Provision for loan losses for other financial assets at amortized cost and financial assets at fair value through OCI   (868)   (759)   (486)   56.2%
Provision for loan losses   (369,129)   (322,785)   (356,494)   (9.5)%
Net operating income before income tax   790,651    691,385    901,106    (23.3)%
Income tax expense   (111,554)   (97,548)   (93,624)   4.2%
Result of discontinued operations               —% 
Net income for the year   679,097    593,837    807,482    (26.5)%
Net income for the year attributable to:                    
Shareholders of the Bank   662,619    579,427    792,276    (26.9)%
Non-controlling interests   16,479    14,410    15,206    (5.2)%

 

(1)Amounts stated in U.S. dollars at and for the year ended December 31, 2023 have been translated from Chilean pesos at the exchange rate of Ch$874.45= U.S.$1.00 as of December 31, 2023.

 

67

 

 

Results of Operations for the Years Ended December 31, 2023 and 2022

 

Net income for the year attributable to shareholders of the Bank decreased 26.9% in 2023 compared to 2022 and totaled Ch$579,427 million. Our return on annualized average equity was 12.3% in 2023 compared to 22.5% in 2022.

 

In 2023, net operating income before credit losses was Ch$1,014,170 million, a decrease of 19.4% compared to 2022.

 

Our net interest income decreased 30.4% in 2023 compared to 2022. Net interest income from our reporting segments totaled Ch$2,088,651 million in 2023 and increased 25.6% compared to 2022. This rise was mainly due to the effect of a better spread on our products and loan growth, partially offset by a more expensive funding mix.

 

The increase in net interest income from our reporting segments was fully offset by a decrease in “other” net income which totaled a loss of Ch$995,602 million in 2023. The decline in other net interest income was mainly due to: (i) the lower results from the UF GAP and (ii) the negative results from fair value hedges of interest rate risk on liabilities (micro hedges), consisting mainly of interest rate swaps that shortened the duration of our liabilities, mainly Central Bank borrowings. Overall, our net interest margin decreased from 3.1% in 2022 to 2.0% in 2023.

 

Net fees and commission income increased 23.4% to Ch$502,640 million in 2023 compared to the same period in 2022. Fee growth in 2023 was driven by client growth and cross-selling indicators driven by greater availability and usage of our digital platforms. This resulted in significant increases in fees from card services, insurance brokerage fees, fees from brokerage of mutual funds and fees from management of accounts. Good business trends in the CIB segment also drove fee growth, despite slower economic activity in 2023. This was reflected in the increase in fees from collections and payments and financial advisory fees. Our subsidiary, Getnet, which provides acquiring services through POS terminals, experienced positive business trends with an increase in clients despite lower economic growth.

 

Total net income from financial operations reached Ch$302,455 million and increased 39.3% in 2023 compared to 2022. Income from client treasury services totaled Ch$246,087 million, an increase of 12.7% compared to 2022. This higher result was driven by higher demand for hedging from our Corporate and Middle-market clients as a result of the rise in long-term interest rates and the volatility of the exchange rate. The results from non-client treasury income totaled a gain of Ch$56,368 million in 2023 compared to a loss of Ch$1,221 million in 2022. During 2023, as long-term interest rates continued to rise, the Bank carried out various liability management exercises including the unwinding of rate and currency hedges and the repurchase of its bonds.

 

Operating expenses in the year ended December 31, 2023 decreased 5.4% compared to the corresponding period in 2022. The efficiency ratio was 47.3% in 2023 and 43.3% in 2022. Personnel salaries and expenses in the year ended December 31, 2023 decreased 0.6% compared to the corresponding period in 2022, mainly due to lower performance bonuses and a 1.7% fall in headcount. Administrative expenses increased 3.2% in the year ended December 31, 2023 compared to the corresponding period in 20213 mainly due to the higher inflation rate and volatility of the Chilean peso, which resulted in the rise of various administrative expenses linked to inflation or the exchange rate. This was partially offset by savings from the ongoing reduction and digitalization of our branch network. Depreciation and amortization expense increased 10.6% in 2023 compared to 2022. This increase was mainly due to a higher amortization of intangible assets, mainly internally created software as part of our digital strategy to improve productivity. Other operating expenses fell 70.2% in 2023 compared to 2022 and totaled Ch$31,638. The decrease responds to lower expenses for insurance premiums for operational risk events as the Bank has implemented different measures to reduce cyber-fraud.

 

For the year ended December 31, 2023, provisions for expected credit loss totaled Ch$322,785 million and decreased 9.5% compared to 2022. This fall was mainly due to a decrease of expected losses in commercial and contingent loans. In 2022, the expected loan loss in these products increased, especially in the construction sector, as interest rates rose sharply. In 2023, as rates began to fall, these sectors saw gradual improvements. Provisions for contingent loans totaled a reversal of Ch$24,363 million for the year ended December 31, 2023 as an update was performed on the forward-looking parameters of contingent credit card loans, resulting in a release of provisions over these contingent loans. These trends were mainly offset by the continued rise in risk levels in consumer and mortgage loans as unemployment levels continued to rise in 2023. Moreover, there was an increase in risk in the agriculture sector as strong rains affected production in some regions of Chile.

 

Total income tax expense by the Bank in 2023 was Ch$97,548 million, an increase of 4.2% compared to 2022. Net income before tax decreased 23.3%. The Bank paid an effective tax rate of 14.1% in 2023 compared to 10.4% in 2022. The statutory corporate tax rate in Chile in 2023 was 27%. The Bank usually pays a lower effective tax rate than the statutory rate since in our Chilean tax books we must re-measure capital each year for the variation in CPI inflation and this produces a tax loss. As the inflation rate was lower in 2023 compared to 2022, the adjustment of capital for CPI resulted in a lower loss in our tax books which increased the effective income tax rate.

 

68

 

 

Net Interest Income

 

   Year ended December 31,   % Change 
   2023   2022   2023/2022 
   (in millions of Ch$,
except percentages)
     
Retail banking   1,381,014    1,129,553    22.3%
Middle-market   459,256    389,297    18.0%
Corporate Investment banking   248,381    143,575    73.0%
Total reporting segments   2,088,651    1,662,425    25.6%
Other(1)   (995,602)   (92,313)   978.5%
Net interest income   1,093,049    1,570,112    (30.4)%
Average interest-earning assets   54,592,187    51,083,192    6.9%
Average non-interest-bearing demand deposits   11,099,866    12,844,814    (13.6)%
Net interest margin(2)   2.00%   3.13%     
Average shareholders’ equity and average non-interest-bearing demand deposits to total average interest-earning assets   28.98%   32.04%     

 

(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, 2023, our net interest income totaled Ch$1,093,049 million and decreased 30.4% compared to 2022. Average interest earning assets increased 6.9% in the same period. During 2023, the loan portfolio grew 5.4%, driven by an 8.5% increase in mortgage loans, a 6.0% increase in consumer loans and a 2.2% increase in commercial loans when compared to the year ended December 31, 2022. The average nominal interest rate earned on interest earning assets increased from 8.0% in 2022 to 8.1% in 2023. This was mainly due to higher yields earned over interest earning assets denominated in Ch$, which benefitted from the repricing of loans at higher rates. Most interest-earning assets have a maturity greater than our interest-bearing liabilities and, therefore, take longer to incorporate rate hikes. Therefore, the strong rate hikes seen in 2022 were reflected in nominal asset yields in 2023. On the other hand, the lower UF inflation rate in 2023 compared to 2022 resulted in a lower yield over UF denominated interest earning assets from 10.2% in 2022 to 7.8% in 2023. The higher U.S.$ interest rate environment also drove the yields on U.S.$ denominated interest earning assets upwards.

 

Average nominal interest rate earned on interest earning assets  2023   2022 
Ch$   9.7%   8.1%
UF   7.8%   10.2%
Foreign currencies   4.4%   1.7%
Total   8.1%   8.0%

 

The higher yield earned over interest-earning assets was more than offset by the higher yield paid over interest-bearing liabilities. The average rate paid on our interest-bearing liabilities increased from 7.3% in 2022 to 8.6% in 2023 despite the fall in yields paid over UF denominated liabilities. The average yield paid on interest bearing liabilities continued to rise in 2023 since: (i) the yield curve remained inverted negatively affecting the cost of liabilities. This also includes the results from fair value hedges of interest rate risk on liabilities (micro hedges), mainly interest rate swaps that shortened the duration of our liabilities, mainly Central Bank borrowings and; (ii) the funding mix became more expensive as the ratio of average equity and non-interest bearing demand deposits to total average interest earning assets fell from 32% in 2022 to 29.0% in 2023.

 

69

 

 

Average nominal interest rate paid on interest bearing liabilities  2023   2022 
Ch$   12.7%   8.8%
UF   8.7%   17.4%
Foreign currencies   0.6%   0.2%
Total   8.6%   7.3%

 

In summary, the inverted yield curve, lower inflation and a more expensive funding mix reduced our net interest margin in 2023 to 2.0% from 3.1% in 2022.

 

Net interest income from our reporting segments in 2023 totaled Ch$2,088,651 million and increased 25.6% compared to 2022. This rise was mainly due to the effect of a better spread on our products, partially offset by a more expensive funding mix.

 

Net interest income from Retail banking increased 22.1% in 2023 compared to 2022. Total loans in the retail segment increased 7.3% with an 8.5% rise in mortgage loans and a 6.0% increase in consumer lending. At the same time, the higher loan spreads drove net interest income in this segment. The average yield earned over consumer loans in 2023 reached 15.1% compared to 12.8% in 2022.

 

Net interest income from the Middle-market segment increased 18.0% in 2023 mainly due to higher yield earned over loans denominated in Ch$ and U.S.$ due to the higher interest rate environment. Loans in this segment increased 1.5% in 2023 compared to 2022.

 

Net interest income from the Corporate Investment Banking segment increased 73.0% in 2023 compared to 2022 mainly due to higher yields earned over loans denominated in Ch$ and U.S.$ due to the higher interest rate environment. Loans in this segment increased 3.3% year-over-year.

 

The increase in net interest income from our reporting segments was fully offset by a decrease in “other” net income which totaled a loss of Ch$995,602 million in 2023. Other net interest income consists mainly of net interest income from the Bank’s ALCO, which includes the 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 decline in other net interest income was mainly due to: (i) the lower results from the UF GAP and (ii) the negative results from fair value hedges of interest rate risk on liabilities (micro hedges), mainly interest rate swaps that shortened the duration of our liabilities, mainly Central Bank borrowings. Even though the short-term rates declined in the second half of 2023, on average they were higher than in 2022, resulting in a higher rate paid over Central Bank borrowings including the micro hedge.

 

70

 

 

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 
   2023   2022   2023/2022 
   (in millions of Ch)     
Retail banking   29,066,792    27,081,897    7.3%
Middle-market   8,774,343    8,641,652    1.5%
Corporate Investment banking   3,077,491    2,978,420    3.3%
Other(1)   (106,740)   27,432    %
Total loans   40,811,886    38,729,401    5.4%

 

(1)Includes interbank loans.

 

The following table shows interest income of financial assets by valuation as of December 31, 2023 and 2022. The 15.6% decrease is mainly due to the lower variation of the UF, which had a negative impact on commercial and mortgage loans denominated in this unit.

 

   At December 31,   % Change 
   2023   2022   2023/2022 
   (in millions of Ch)     
Financial assets measured at amortized cost(1)   4,039,618    4,988,277    (19.0)%
Financial assets measured al FVOCI(2)   436,193    316,478    37.8%
Interest income not including income from hedge accounting   4,475,811    5,304,755    (15.6)%

 

(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.

 

71

 

 

Fee and Commission Income

 

Net fees and commission income increased 23.4% to Ch$502,640 million in the twelve-month period ended December 31, 2023 compared to the same period in 2022. Fee growth in 2023 continued to be driven by client growth and cross-selling indicators driven by greater availability and usage of our digital platforms and positive Net Promoter Score indicators. Good business trends in the CIB segment also drove fee growth, despite slower economic activity in 2023.

 

   Year ended December 31,   % Change 
   2023   2022   2023/2022 
Total clients(1)   4,052,314    3,910,094    3.6%
Active clients(2)   2,398,741    2,195,847    9.2%
Loyal clients(3)   850,905    855,156    (0.5)%
Digital clients(4)   2,113,128    1,981,540    6.6%

 

(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, 2023 and 2022.

 

   Year ended December 31,   % Change 
   2023   2022   2023/2022 
   (in millions of Ch$)     
Card services (credit, debit and ATM cards)(1)     131,418    104,929    25.2%
Insurance brokerage   61,511    52,568    17.0%
Collections and payments   60,912    54,060    12.7%
Brokerage of mutual funds   60,823    56,543    7.6%
Management of accounts (checking and debit)   59,538    52,226    14.0%
Getnet  (acquirer)   49,039    27,060    81.2%
Guarantees and Letters of credit   34,462    35,935    (4.1)%
Office banking   18,636    19,389    (3.9)%
Prepayments   14,152    11,348    24.7%
Financial advice   15,422    9,362    64.7%
Others   (3,273)   (16,151)   (79.7)%
Total fees and commission income, net   502,640    407,269    23.4%

 

(1)Excludes Getnet, our acquiring business, which was launched in February 2021.

 

Fees from card services increased 25.2% in 2023 due to the growth of our Santander Life debit and credit cards as well as increased use by all our card-using customers. The Bank also increased the number of ATMs during the year by 27.7%, from 1,647 as of December 31, 2022 to 2,103 machines as of December 31, 2023, resulting in higher fees from clients from other banks and financial institutions using our machines. These increases were offset by an decrease in the Bank’s maximum interchange rates to 1.48% for credit cards, 0.6% for debit cards and 1.04% for prepaid cards. As a result of this regulation, card fees were reduced by Ch$17 billion in 2022 and Ch$4.5 billion in 2023. We expect that this reduction will have a significant impact on our revenue from card fees, which we expect will decrease by approximately Ch$25 billion in 2024 and approximately Ch$47 billion in 2025.

 

Insurance brokerage fees increased 17.0% due to an increase in the sale of car and life insurance, primarily due to advances in our digital platforms that enable clients to search for and purchase these products online more easily.

 

72

 

 

Fees from collections and payments increased 12.7% in 2023 compared to 2022 due to higher collection of loan fees and loan-related insurance premiums.

 

Fees from the brokerage of mutual funds increased 7.6% in 2023 compared to 2022 driven by a rise in sales of funds to our clients driven by positive returns in both the equity and short-term fixed income funds.

 

Fees from management of accounts increased 14.0% in 2023 compared to 2022 driven by continued strong account opening growth. This was driven by our client friendly digital platforms such as Santander Life, which in 2023 included an additional feature that allowed clients to easily open a U.S.$ denominated checking accounts online.

 

Fees from Getnet increased 81.2% in 2023 compared to 2022 driven by strong growth in the number of SME customers of Getnet and greater usage of cards for payments in general in Chile.

 

Fees from guarantees and letters of credit decreased 4.1% in 2023 compared to 2022. This line corresponds to international and foreign trade financing business with clients. The decrease was mainly due to the slowdown of economic activity in 2023.

 

Fees from office banking decreased 3.9% in 2023 compared to 2022 mainly due to lower economic growth in 2023.

 

Fees from the prepayment of loans increased 24.7% mainly due to higher prepayments of consumer loans, as rates remained high in the year.

 

Fees from financial advice grew 64.7% in 2023. Despite lower economic growth, our CIB segment experienced a rise in large advisory deals during the year.

 

The 79.7% decrease in the loss from other fee income in 2023 compared to 2022 was mainly due to higher fees for various services in the CIB segment. Other fees also include the fees paid to our support company Santander Gestión de Recaudación y Cobranzas, Ltda.

 

73

 

 

The following table sets forth, for the periods indicated our fee income broken down by segment for the periods indicated:

 

   Year ended December 31,   % Change 
   2023   2022   2023/2022 
   (in millions of Ch$)     
Retail banking   376,643    312,706    20.4%
Middle-market   64,964    62,644    3.7%
Corporate Investment banking   50,457    37,300    35.3%
Other   10,576    (5,381)   %
Total fees and commission income, net   502,640    407,269    23.4%

 

Fees from Retail banking increased 20.4% in 2023 compared to 2022 mainly driven by higher fees from card services, management of accounts (mainly Santander Life), mutual fund brokerage, and Getnet, our acquiring business geared toward SME clients. The greater availability and usage of our digital platforms and positive Net Promoter Score indicators drove strong product growth in this segment, despite slower economic activity.

 

The 3.7% increase in fees from the Middle-market segment in 2023 compared to 2022 was mainly due to greater customer activity in payments and collection services. However, lower economic growth reduced demand for other products such as Guarantees and Letters of credit and usage of our Office banking digital platform.

 

Fees from the Corporate Investment banking segment increased 35.3% in 2023 compared to 2022, mainly due to higher fees from investment banking and financial advisory services.

 

Fees in Other totaled a gain of Ch$10,576 million compared to a loss of Ch$5,381 million in 2022. This was mainly due to the reversal of fee commissions contractually set aside as part of our agreement with our main insurance underwriter, Zurich Chile, as commercial results exceeded expectations during 2023.

 

Net Income from Financial Operations

 

The following table sets forth information regarding our income (loss) from financial transactions for the years ended December 31, 2023 and 2022.

 

   Year ended December 31,   % Change 
   2023   2022   2023/2022 
   (in millions of Ch$)     
Net income/(expense) from financial assets and liabilities for trading   91,761    78,191    17.4%
Net income from derecognizing financial assets and liabilities at amortized cost and financial assets at fair value through other comprehensive income   (120,934)   (1,628)   7328.4%
Net income from exchange, adjustment and hedge accounting of foreign exchange   331,628    140,615    135.8%
Net income from financial operations   302,455    217,178    39.3%

 

Net income from financial operations totaled Ch$302,455 million in the year ended December 31, 2023, an increase of 39.3% compared to the same period in 2022. These results include the results of our Treasury Division’s trading business and financial transactions with customers, and the results of our Financial Management Division. Internal Bank policy does not allow significant foreign currency mismatches and requires that the results included in Net income from financial operations includes not only the market-to-market of our foreign currency spot position, but also the results of the derivatives used to hedge currency risk. The mark-to-market of our spot position and the derivatives used to hedge foreign currency risk are classified as trading and are included 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.”

 

74

 

 

Net income from financial assets and liabilities for trading totaled a gain of Ch$91,761 million in the year ended December 31, 2023 and increased 17.4% compared to a gain of Ch$78,191 million in 2022. This increase was mainly due to greater client demand for treasury products given the high market volatility and the increases in the monetary policy rate.

 

Net income from derecognizing financial assets and liabilities at amortized cost and financial assets at fair value through other comprehensive income totaled a loss of Ch$120,934 million in the year ended December 31, 2023 compared to a loss of Ch$1,628 million in the same period in 2022. The increase in long-term interest rates in 2023 resulted in higher losses from the derecognition of financial assets at fair value through other comprehensive income.

 

Net income from exchange, adjustment and hedge accounting of foreign exchange totaled Ch$331,628 million in the year ended December 31, 2023, an increase of 135.8% compared to the gain obtained in 2022. The higher long-term rates and depreciation of the peso explain this higher result. The Bank uses cross-currency swaps to hedge the risk of the variability of cash flows attributable to changes in the interest rate of bonds and interbank loans issued at floating rates and to hedge foreign currency fluctuations, mainly in U.S. dollars.

 

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 2023 and 2022.

 

   Year ended December 31,   % Change 
   2023   2022   2023/2022 
   (in millions of Ch$)     
Client treasury products   181,621    160,650    13.1%
Market-making with clients   64,466    57,749    11.6%
Client treasury services   246,087    218,399    12.7%
Sale of loans and charged-off loans   (767)   (485)   58.1%
CVA adjustments   (5,994)   (9,464)   (36.7)%
Financial Management Division and others(1)   63,129    8,728    623.3%
Non-client treasury income (loss)   56,368    (1,221)   %
Total financial transactions, net   302,455    217,178    39.3%

 

(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$246,087 million, an increase of 12.7% compared to 2022. 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 2023, the results from client treasury products increased 13.1%. This higher result was driven by higher demand for hedging from our Corporate and Middle-market clients as a result of the rise in long-term interest rates and the volatility of the exchange rate. The results from market-making with client services increasing 11.6% in 2023 was mainly due to the increase in long-term rates which created market volatility driving an increase in business volumes of our corporate clients. These results may vary year-to-year as some large operations with corporate clients may not be repeated in subsequent years.

 

75

 

 

The results from non-client treasury income totaled a gain of Ch$56,368 million in 2023 compared to a loss of Ch$1,221 million in 2022. These results include the income from sale of loans, including charged-off loans, CVA adjustments and the results from our Financial Management Division. The results of the Bank’s Financial Management Division totaled a gain of Ch$63,129 million compared to a loss of Ch$45,323 million in 2021. During 2023, as long-term interest rates continued to rise, the Bank carried out various liability management exercises including the unwinding of rate and currency hedges and the repurchase of its bonds, which resulted in higher revenues in 2023 in this division.

 

The results from the sale of loans totaled a loss of Ch$767 million in 2023 compared to a loss of Ch$485 million in 2022, which represent an increase of 58.1%. The results from CVA adjustment improved from a loss of Ch$9,464 million in 2022 to a loss of Ch$5,994 million in 2023. This was mainly due to a loss from CVA adjustments of our derivative portfolio, which is included in this line item, since the CVA generated by derivatives taken for hedging and on behalf of clients is not part of client income or part of Financial Management’s profit and loss. During 2023, the CVA adjustment loss decreased since in 2022 this loss was negatively affected by higher counterparty risk triggered by the war in Ukraine.

 

Other Operating Income

 

   Year ended December 31,   % Change 
   2023   2022   2023/2022 
   (in millions of Ch$)     
Income from investments in associates and other companies   8,763    10,310    (15.0)%
Net income from non-current assets and non-continued operations   13,154    8,518    54.4%
Other operating income:               
Pension plan interest   539    963    (44.0)%
Compensation from insurance companies due to damages(1)   45    141    (68.1)%
Rental income   457    488    (6.4)%
Income from recovery tax and expenses   661    548    20.6%
Income from business alliance   1,218    1,180    3.2%
Other   887    2,219    (60.0)%
Subtotal   3,807    5,539    (31.3)%
Total   25,724    24,367    5.6%

 

(1)Mainly related to recoveries from fraud claims.

 

Total other operating income increased by 5.6% in 2023 compared to 2022 and totaled a gain of Ch$25,724 million. This was mainly due to the 54.4% increase in 2023 of the results from non-current assets and non-continued operations, which was mainly due to higher income from assets received in lieu of payments. This was partially offset by lower income from investments in associates and other companies, which totaled a gain of Ch$8,763 million in 2023 and decreased 15.0%. in comparison with 2022 This, in turn was mainly due to lower income from Transbank and Redbanc, which is correlated with the slowdown of economic growth and consumption in 2023.

 

76

 

 

Operating Expenses

 

The following table sets forth information regarding our operating expenses in the years ended December 31, 2023 and 2022.

 

   Year ended December 31,   % Change 
   2023   2022   2023/2022 
   (in millions of Ch$)     
Personnel salaries and expenses   (412,275)   (414,808)   (0.6)%
Administrative expenses   (320,111)   (310,219)   3.2%
Depreciation and amortization   (143,762)   (129,993)   10.6%
Impairment of property, plant and equipment   (1,912)        —%
Other operating expenses   (31,638)   (106,306)   (70.2)%
Total operating expenses   (909,698)   (961,326)   (5.4)%
Efficiency ratio(1)   47.3%   43.3%     

 

(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, 2023 decreased 5.4% compared to the corresponding period in 2022. The efficiency ratio was 47.3% in 2023 and 43.3% in 2022.

 

Personnel salaries and expenses in the year ended December 31, 2023 decreased 0.6% compared to the corresponding period in 2022, mainly due to lower performance bonuses and a 1.7% fall in headcount.

 

Administrative expenses increased 3.2% in the year ended December 31, 2023 compared to the corresponding period in 2022 mainly due to the higher inflation rate and volatility of the Chilean peso, which resulted in the rise of administrative expenses, as items such as rent and outsourced service contracts, such as the security transport vehicles, are indexed to inflation. The growth of the Bank’s checking accounts, client base and ATM network also increased data processing costs in 2023. This rise was partially offset by reductions in the Bank’s branch network. As of December 31, 2023, the Bank had a total of 247 branches, 91 of which were in the WorkCafé format. The table below provides a breakdown of the Bank’s branch network during the periods indicated.

 

   Year ended December 31,   % Change 
   2023   2022   2023/2022 
   (in millions of Ch$)     
Traditional branches   136    182    (25.3)%
Workcafes   91    74    23.0%
Select   4    6    (33.3)%
Middle-market & other payment centers   16    24    (33.3)%
Total branches   247    286    (13.6)%
Total ATMs (including depositary ATMs)   2,103    1,647    27.7%

 

77

 

 

Depreciation and amortization expense increased 10.6% in 2023 compared to 2022. This increase was mainly due to a higher amortization of intangible assets, mainly internally created software as part of our digital strategy to improve productivity.

 

In 2023, the Bank also recognized an impairment of Ch$1,912 million due to the impairment of technological development for Superdigital, a digital product which is being discontinued.

 

Other operating expenses fell 70.2% in 2023 compared to 2022 and totaled Ch$31,638. The decrease responds to lower expenses for insurance premiums for operational risk events as the Bank has implemented different measures to reduce cyberfraud, such as general improvements in security of digital channels, longer and more complex web access codes, physical cards without visible numbers, dynamic CVV, among others. 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 
   2023   2022   2023/2022 
   (in millions of Ch$)     
Retail banking   (661,901)   (635,991)   4.1%
Middle-market   (106,851)   (105,160)   1.6%
Corporate Investment banking   (95,914)   (91,926)   4.3%
Other   (11,482)   (21,943)   (47.7)%
Total personnel, administrative expenses, depreciation and amortization (1)   (876,148)   (855,020)   2.5%

 

(1)Excludes impairment and other operating expenses.

 

The 2.5% increase in total costs was mainly due to greater business activity, higher product usage, and the impact of higher inflation and the volatility of the Chilean peso on administrative expenses. 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. The Middle-market segment saw a moderate rise in costs in line with overall business trends in this segment in 2023. Costs in CIB saw moderate growth of 4.3% in 2023, despite strong business trends as transactional services did not grow significantly compared to advisory and investment banking services that are less cost intensive.

 

78

 

 

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, 2023.

 

For the year ended   Stage 1   Stage 2   Stage 3     
December 31, 2023  Corporate   Other (2)   Corporate   Other (2)   Corporate   Other (2)   TOTAL (1) 
   (in millions of Ch$) 
Commercial loans   132    (3,898)   (19,358)   4,686    92,539    81,616    155,717 
Mortgage loans       (4,582)       (1,213)       97,364    91,569 
Consumer loans       29,029        57,262        119,881    206,172 
Contingent loans   (1,184)   (14,256)   (6,316)   (1,834)   816    (1,589)   (24,363)
Loans and account receivable at FVOCI   (201)                       (201)
Debt at FVOCI       (78)                   (78)
Debt at amortized cost       1,038                    1,038 
Subtotal   (1,253)   7,253    (25,674)   58,901    93,355    297,272    429,854 
Recovery of loans previously charged-off                                 (107,069)
TOTAL                                 322,785 

 

(1)Includes overlays for an amount of Ch$93,614 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, 2023, the P&L impact for provisions for expected credit loss totaled Ch$322,785 million and decreased 9.5% compared to 2022. This decrease was mainly due to a decrease of risk in commercial and contingent loans. In 2022, the expected loan loss in these products increased, especially in the construction sector, as interest rates rose sharply. In 2023, as rates began to fall, these sectors saw gradual improvements. This trend was mainly offset by the continued rise in risk levels in consumer and mortgage loans as unemployment levels continued to rise in 2023. Moreover, there was an increase in risk in the agriculture sector as strong rains affected production in some regions of Chile. The table below breaks down these results by main product item:

 

   Year ended December 31,   % Change 
   2023   2022   2023/2022 
   (in millions of Ch$)     
Commercial loans   (155,717)   (198,165)   (21.4)%
Mortgage loans   (91,569)   (41,381)   121.3%
Consumer loans   (206,172)   (201,859)   2.1%
Contingent loans   24,363    (5,189)   %
Loans and AR at FVOCI   201    (58)   %
Debt at FVOCI   78    529    (85.3)%
Debt at amortized cost   (1,038)   (957)   8.5%
Subtotal   (429,854)   (447,071)   (3.9)%
Recoveries   107,069    90,577    18.2%
Total Provision for Loan Losses   (322,785)   (356,494)   (9.5)%

 

Provisions for expected credit losses of our commercial loans totaled Ch$155,717 million for the year ended December 31, 2023 and decreased 21.4% compared to 2022. Commercial loans increased 2.2% in the year, which increased provision expenses. This was more than offset by a decrease in provision expense in commercial loans due to greater transfer of commercial clients from Stage 2 to Stage 1 and Stage 3 to Stage 2. In 2022, as interest rates rose sharply, the expected loan loss in various segments increased. In 2023, as rates began to fall, some sectors saw gradual improvements.

 

79

 

 

Provisions for expected credit losses for mortgage loans totaled an expense of Ch$91,569 million for the year ended December 31, 2023, compared to an expense of Ch$41,381 million in 2022. Mortgage loans increased 8.5% in 2023 compared to 2022. This, together with lower economic growth in 2023, and a rise in unemployment led to a rise in the expected loss of the mortgage loan book reflected in the increase in transfers from Stage 1 to Stage 2 and from Stage 2 to Stage 3.

 

The provisions for expected credit losses for consumer loans totaled a charge of Ch$206,172 million and increased 2.1% in 2023 compared to 2022. During 2023, the consumer loan book increased 6.0% compared to 2022, mainly driven by a rise in credit card loans. This, together with lower economic growth in 2023, and a rise in unemployment led to a rise in the expected loss of the consumer loan book reflected in the increase in consumer loans classified in stages 2 and 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 2023, write-off for this loan book increased 55.0% and totaled Ch$271,123 million.

 

Provisions for contingent loans totaled a reversal of Ch$24,363 million for the year ended December 31, 2023 compared to a provision expense of Ch$5,189 million in 2022. In 2023, an update was performed on the forward-looking parameters of contingent credit card loans, resulting in a release of provision over these contingent loans.

 

Generally, charge-offs should be done when all collection efforts are exhausted. These charge-offs consist of de-recognition 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 18.2% in 2023 compared to 2022 as greater amounts of write-offs led to higher recoveries. The following table shows recoveries of loans previously charged-off by type of loan.

 

   Year ended December 31,   % Change 
   2023   2022   2023/2022 
   (in millions of Ch$)     
Recovery of loans previously charged-off            
Consumer loans   27,722    24,140    14.8%
Residential mortgage loans   27,763    21,575    28.7%
Commercial loans   51,584    44,862    15.0%
Total recoveries   107,069    90,577    18.2%

 

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, 2023 and 2022.

 

80

 

 

   Year ended December 31,   % Change 
   2023   2022   2023/2022 
   (in millions of Ch$)     
Gains (losses) on sale of loans previously charged off   (767)   (485)   58.1%

 

The following table sets forth, for the periods indicated, our net provision expense broken down by business segment:

 

   Year ended December 31,   % Change 
   2023   2022   2023/2022 
   (in millions of Ch$)     
Retail banking   (295,221)   (290,184)   1.8%
Middle-market   (37,515)   (57,253)   (34.5)%
Corporate Investment banking   10,418    (8,082)   %
Other   (467)   (1,075)   (56.6)%
Total provisions, net   (322,785)   (356,494)   (9.5)%

 

Net provisions expense from retail banking increased 1.8% in 2023 compared to 2022. Loans in this segment increased 7.3% in 2023 compared to 2022. Simultaneously, the slowdown of economic growth and the rise in unemployment led to an increase in provisions in this segment, mainly for consumer and residential mortgage loans. In 2023, an update was performed on the forward-looking parameters of contingent credit card loans, resulting in a release of provision over these contingent loans that partially offset the rise in provisions for consumer and mortgage loans.

 

Net provision expense from the Middle-market segment decreased 34.5% in 2023 despite a 1.5% increase in this loan portfolio. This decrease was mainly due to a decrease of risk in commercial and contingent loans. In 2022, the expected loan loss in these products increased, especially in the construction sector, as interest rates rose sharply. In 2023, as rates began to fall, these sectors saw gradual improvements or a stabilization of their risk levels.

 

Net provision expense from CIB totaled a reversal of Ch$10,418 million in 2023 compared to 2022 despite a 3.3% rise in this segment´s loan book in the year. This reversal was due to improvements in the risk classification of various clients.

 

Total provisions, net included in Others totaled an expense of Ch$467 million in 2023 compared to an expense of Ch$1,075 million in 2022. This was mainly due to an improved ECL of non-segmented loans. .

 

As of December 31, 2023, the Bank maintains Ch$93,614 million in residual overlays, 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.

 

Income tax

 

   Year ended December 31,   % Change 
   2023   2022   2023/2022 
   (in millions of Ch$)     
Net operating income before tax   691,385    901,106    (23.3)%
Income tax expense   (97,548)   (93,624)   4.2%
Effective tax rate(1)   14.1%   10.4%     

 

(1)The effective tax rate is the income tax expense divided by net income before tax.

 

Total income tax expense by the Bank in 2023 was Ch$97,548 million, an increase of 4.2% compared to 2022. Net income before tax decreased 23.3%. The Bank paid an effective tax rate of 14.1% in 2023 compared to 10.4% in 2022. The statutory corporate tax rate in Chile in 2023 was 27%. The Bank usually pays a lower effective tax rate than the statutory rate since in our Chilean tax books we must re-measure capital each year for the variation in CPI inflation and this produces a tax loss. As the inflation rate was lower in 2023 compared to 2022, the adjustment of capital for CPI resulted in a lower loss in our tax books which increased the effective income tax rate. See “Note 13—Current and Deferred Taxes” of the Audited Consolidated Financial Statements for more detail on income tax expense.

 

81

 

 

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, 2023, 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, 2023   
Obligations under repurchase agreements       282,483        101    282,584                    282,584 
Checking accounts, time deposits and other time liabilities(1)   14,641,150    7,999,764    3,689,743    3,950,166    30,280,823    138,320    3,364    28,343    170,027    30,450,850 
Financial derivatives contracts       376,279    1,170,614    2,443,279    3,990,172    3,056,317    1,526,321    3,415,532    7,998,170    11,988,342 
Interbank borrowings   18,220    42,730    727,302    9,100,446    9,888,698    304,384    173,417        477,801    10,366,499 
Issued debt instruments       291,687    285,923    1,272,427    1,526,001    3,183,069    1,314,205    3,467,672    8,288,982    9,814,983 
Lease liabilities       296,095            296,095    164    14        178    296,273 
Other financial liabilities(2)               20,716    20,716    37,446    22,913    23,441    83,800    104,516 
Subtotal   14,659,370    9,036,935    5,851,238    16,737,546    46,285,089    7,046,369    2,979,714    6,992,875    17,018,958    63,304,047 
Contractual interest payments(3)       374,602    1,447,858    3,113,981    4,936,441    2,784,288    2,675,100    3,772,174    9,231,562    14,168,004 
Total   14,659,370    9,411,537    7,299,096    19,851,527    51,221,530    9,830,657    5,654,814    10,765,049    26,250,520    77,472,051 

 

(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$30,280,823 million as of December 31, 2023. Santander-Chile’s liquidity depends upon its (i) capital, (ii) reserves and (iii) financial investments, including 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$8,048,069 million as of December 31, 2023, 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.

 

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 lengthening the maturities of funding with institutional clients, diversifying our bondholder base. Overall, the management of our liquidity and funding has led to an LCR ratio of 212% and a NSFR of 106%. Furthermore, the Bank also has regulatory capital of Ch$6,978,733 million, representing 17.6% of our risk-weighted assets as of December 31, 2023.

 

82

 

 

Lease liabilities

 

Certain bank premises and equipment are leased and the scheduled maturities of obligations for lease agreements as of December 31, 2023 were as follows:

 

   As of
December 31,
2023
 
   (in millions of Ch$) 
Due within 1 year   20,716 
Due after 1 year but within 2 years   19,696 
Due after 2 years but within 3 years   17,750 
Due after 3 years but within 4 years   12,949 
Due after 4 years but within 5 years   9,964 
Due after 5 years   23,441 
Total   104,516 

 

Other Commercial Commitments

 

As of December 31, 2023, 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   95,503    164,384    667,477    653,899    37,505    22,743    1,641,511 
Confirmed foreign letters of credit   91,073    125,429    40,450    5,544    -    -    262,496 
Pledges and other commercial commitments   15,931    56,527    378,745    28,860    13,500    541    494,104 
Total other commercial commitments   202,507    346,340    1,086,672    688,303    51,005    23,284    2,398,111 

 

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, 2023 
   Current   Non-current   Total 
   Ch$ million 
Other equity instruments issued other than capital (Perpetual bond)       608,721    608,721 
Total       608,721    608,721 

 

83

 

 

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 loans and Central Bank bonds and include the collateral for the Central Bank Credit Lines (FCIC) used in 2021, 2022 and 2023. In 2023, the financial instruments at amortized cost also include the Liquidity Deposits (LD) aimed exclusively at guaranteeing and providing operational support the payment of the FCIC. These instruments are issued at floating MPR with the same payment dates of the various FCIC facilities. As of December 31, 2023, the Bank has invested Ch$3,392,609 million in this type of instrument.

 

   As of December 31, 2023 
   2023   2022   2021 
   (in millions of Ch$) 
Chilean Central Bank and Government securities   8,178,624    4,868,485    4,692,441 
Other Chilean Securities            
Foreign securities            
Investment in mutual funds            
Total (gross carrying amount)   8,178,624    4,868,485    4,692,441 

 

(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.

 

84

 

 

Debt financial instruments at fair value through other comprehensive income (FVOCI) – under IFRS 9

 

As of December 31, 2023, 2022 and 2021, the debt instruments at fair value through other comprehensive income (FVOCI) in accordance with IFRS 9 are as follows:

 

   As of December 31, 2023 
   2023   2022   2021 
   (in millions of Ch$) 
Chilean central bank and government securities    
Chilean Central Bank financial instruments   2,286,541    3,331,264    3,258,417 
Chilean Treasury bonds and notes   737,705    742,717    981,939 
Other Chilean government financial instruments   454    432     
Subtotal   3,024,700    4,074,413    4,240,356 
of which sold under repurchase agreement   362,893    207,280    86,554 
Other Chilean debt financial securities               
Chilean Bank debt financial instruments   6,656    9,891    11,774 
Other Chilean financial instruments       7     
Subtotal   6,656     9,898    11,774 
of which sold under repurchase agreement   77    91    80 
Foreign financial securities               
Foreign Central Banks debt financial instruments   1,238,866    1,668,670    1,438,155 
Other foreign financial instruments   265,803    127,752    111,094 
Subtotal   1,504,669    1,796,422    1,549,249 
of which sold under repurchase agreement       127,752     
Total   4,536,025    5,880,733    5,801,379 

 

(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, 2023 
   2023   2022   2021 
   (in millions of Ch$) 
Central Bank and Government Securities   98,308    153,967    68,649 
Other Chilean Securities           4,698 
Foreign financial debt securities       79     
Investments in mutual funds            
Total   98,308    154,046    73,347 

 

(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.

 

85

 

 

Analysis of investments

 

The following table sets forth an analysis of our investments as of December 31, 2023 by remaining maturity and the weighted average nominal rates of such investments.

 

   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 Nominatl Rate   Total   Weighted average Nominal Rate 
   (in millions of Ch$, except rates) 
As of December 31, 2023 Financial Assets Held for Trading at fair value Central Bank and Government Securities   
Chilean Central Bank financial instruments                                        
Chilean Treasury bonds and notes   2,487    7.76    32,463.00    4.46    46,762.00    4.96    16,596.00    5.39    98,308    4.94 
Other Chilean government financial instruments                                        
Subtotal   2,487        32,463.00        46,762.00        16,596.00        98,308     
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   2,487        32,463.00        46,762.00        16,596.00        98,308     

 

86

 

 

   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 Nominatl Rate   Total   Weighted average Nominal Rate 
   (in millions of Ch$, except rates) 
As of December 31, 2023 Debt instruments at amortized cost   
Chilean Central Bank debt financial instruments   3,392,609    8.25                            3,392,609    8.25 
Chilean Treasury bonds and notes   331,808    5.70    4,454,207    1.36                    4,786,015    1.66 
Total   3,724,417         4,454,207                         8,178,624      
                                                   
Debt instruments at FVOCI                                                  
Chilean Central Bank financial instruments   2,286,541    8.41                            2,286,541    8.41 
Chilean Treasury bonds and notes           175,974.00    2.50    477,314.00    1.72    84,417.00    3.40    737,705    2.10 
Other Chilean government financial instruments   454    4.51                            454    4.51 
Subtotal   2,286,995        175,974        477,314        84,417        3,024,700     
Other Chilean Securities                                                  
Chilean Bank debt financial instruments   944    9.63    3,672    3.49    1,030    3.69    1,010    4.15    6,656    4.49 
Chilean bonds and commercial papers                                        
Other Chilean financial instruments                                        
Subtotal   944        3,672        1,030        1,010        6,656     
Other Financial Securities                                                  
Foreign Central Banks debt financial instruments                                        
Foreign government and state debt financial instruments           980,681    3.83    258,185    3.49            1,238,866    3.76 
Other foreign debt financial instruments                   265,803    5.07            265,803    5.07 
Subtotal           980,681        523,988                1,504,669     
Total   2,287,939        1,160,327        1,002,332        85,427        4,536,025     

 

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.

 

87

 

 

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 now uses as its 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, 2023 and 2022, the breakdown of the Bank’s liquid assets by levels was the following:

 

   December 31,
2023
   December 31,
2022
 
   (Ch$ million)   (Ch$ million) 
Balance as of:        
Cash and cash equivalent   1,969,547    1,453,265 
Level 1 liquid assets (1)   6,072,282    5,424,452 
Level 2 liquid assets (2)   6,240    8,066 
Total liquid assets   8,048,069    6,885,783 

 

(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. Collateral under the FCIC funding program with the Central Bank of Chile and technical reserve in the Central Bank are not included.

 

(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,
2023
   December 31,
2022
 
   (Ch$ million)   (Ch$ million) 
Average balance as of:        
Cash and cash equivalent   1,328,956    1,237,652 
Level 1 liquid assets (1)   5,275,734    3,957,449 
Level 2 liquid assets (2)   7,001    8,785 
Total liquid assets   6,611,690    5,203,887 

 

(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. Collateral under the FCIC funding program with the Central Bank of Chile and technical reserve in the Central Bank are not included.

 

(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.”

 

88

 

 

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, 
   2023   2022   2021 
   Millions of Ch$ 
Net cash flow (used in) provided by operating activities   1,315,758    (358,988)   (594,679)

 

Our operating activities provided cash for Ch$1,315,758 million in 2023, mainly due to the high growth of time deposits, foreign bank lines and bond issuances that was greater than loan growth. Our operating activities used cash for Ch$358,988 million in 2022, derived from lower loan growth, a decrease in checking accounts and the redemption of senior bonds in the year. This was partially offset by an increase in financial investment. Our operating activities used cash for Ch$594,679 million in 2021, mainly derived from an increase in loans and financial investment, partially offset by an increase in deposits, principally demand deposits.

   Year ended December 31, 
   2023   2022   2021 
   Millions of Ch$ 
Net cash (used in) provided by investment activities   (117,850)   (94,602)   (84,271)

 

In 2023, the Bank’s investment activities consumed cash in an amount of Ch$117,850 million, mainly due to the purchase of property, plant and equipment which was mainly related to investments in the WorkCafe branch network. Cash was also consumed by investments in intangible assets, mainly related to the Bank’s digital strategy. In 2022, the Bank’s investment activities consumed cash in an amount of Ch$94,602 million, mainly due to the purchase of intangible assets, mainly related to the digital strategy. In 2021 the Bank’s investment activities consumed cash in an amount of Ch$84,271 million, mainly due to purchases of property, plant and equipment, as well as intangible assets such as software.

 

   Year ended December 31, 
   2023   2022   2021 
   Millions of Ch$ 
Net cash  provided by (used in) financing activities   (515,292)   (384,323)   238,661 

 

In 2023, net cash used in financing activities was Ch$515,292 million and was mainly due to the payment of the annual dividend paid to shareholders on April 26, 2023. In 2022, net cash used in financing activities was Ch$384,323 million due to the annual dividend payment, which was partially offset by issuance of subordinated bonds, which amounted to a cash increase of Ch$102,481 million. In 2021, net cash provided by financing activities was Ch$238,661 million due to the placement of a perpetual bond, which amounted to a cash increase of Ch$595,175 million. This was partially offset by the annual dividend payment.

 

89

 

 

Deposits and Other Borrowings

 

The following table sets forth our average balance of liabilities for the years ended December 31, 2023, 2022, and 2021, in each case together with the related average nominal interest rates paid thereon.

 

   2023   2022   2021 
   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   190,469    0.3%   3.6%   198,478    0.3%   11.3%   177,779    0.3%   5.9%
Time deposits   16,392,793    23.6%   7.4%   14,114,807    20.3%   5.9%   13,174,290    22.8%   0.8%
Central Bank borrowings   5,773,345    8.3%   12.2%   5,441,584    7.8%   8.5%   5,546,895    9.6%   0.5%
Repurchase agreements   779,214    1.1%   7.2%   450,632    0.6%   3.7%   135,078    0.2%   0.7%
Mortgage finance bonds   2,063    0.0%   9.3%   5,058    0.0%   17.3%   9,105    0.0%   10.9%
Commerical paper   613,212    0.9%   5.8%   298,142    0.4%   2.4%   277,666    0.5%   0.3%
Other interest bearing liabilities   14,920,208    21.5%   8.7%   14,449,972    20.8%   8.3%   9,781,372    16.9%   9.8%
Subtotal interest-bearing liabilities   38,671,304    55.6%   8.6%   34,958,674    50.4%   7.3%   29,102,186    50.3%   3.8%
Non-interest bearing liabilities                                             
Non-interest bearing deposits   11,099,866    16.0%        12,844,814    18.5%        14,035,242    24.3%     
Derivatives   10,937,411    15.7%        11,979,276    17.3%        7,666,801    13.2%     
Other non-interest bearing liabilities   4,108,850    5.9%        6,079,681    8.8%        3,000,598    5.2%     
Shareholders’ equity   4,720,294    6.8%        3,524,063    5.1%        4,062,407    7.0%     
Subtotal non-interest bearing liabilities   30,866,421    44.4%        34,427,834    49.6%        28,765,048    49.7%     
Total liabilities   69,537,725    100.0%        69,386,508    100.0%        57,867,233    100.0%     

 

Our most important source of funding is our deposits. Average time deposits plus non-interest bearing demand deposits represented 39.5% of our average total liabilities and shareholders’ equity in 2023. As of December 31, 2023, the Bank’s top 20 time deposits represented 33.0% of total time deposits, or 7.5% 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.

 

90

 

 

Composition of Deposits

 

The following table sets forth the composition of our deposits and similar commitments at December 31, 2023, 2022, 2021, 2020 and 2019.

 

   2023   2022   2021   2020   2019 
   (in millions of Ch$) 
Demand deposits and other demand obligations                         
Current accounts   11,014,748    11,711,969    14,385,633    11,342,648    8,093,108 
Other deposits and demand accounts   854,595    1,016,896    1,773,233    1,583,183    741,103 
Other demand obligations   1,668,483    1,357,361    1,742,072    1,635,062    1,463,221 
Subtotals   13,537,826    14,086,226    17,900,938    14,560,893    10,297,432 
Time deposits and other time deposits                         
Time deposits   15,939,325    12,779,206    9,926,507    10,421,872    13,064,932 
Time saving accounts   189,757    191,257    195,570    153,330    123,787 
Other time deposits   8,860    8,327    8,978    6,589    4,098 
Subtotals   16,137,942    12,978,790    10,131,055    10,581,791    13,192,817 
Total deposits and other commitments   29,675,768    27,065,016    28,031,993    25,142,684    23,490,249 

 

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, 2023, 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   Currencies   Total 
Demand deposits   0.0%   0.5%   0.0%   0.1%
Savings accounts   0.2%   15.5%   0.0%   1.2%
Time deposits:                    
Maturing within 3 months   76.2%   42.3%   72.1%   73.2%
Maturing after 3 but within 6 months   13.0%   22.5%   24.3%   15.7%
Maturing after 6 but within 12 months   9.6%   13.9%   3.2%   8.7%
Maturing after 12 months   1.0%   5.3%   0.4%   1.2%
Total time deposits   99.8%   83.9%   100.0%   98.8%
Total deposits   100.0%   100.0%   100.0%   100.0%

 

The following table sets forth information regarding the maturity of our outstanding time deposits as of December 31, 2023.

 

   Ch$   UF   Foreign
Currencies
   Total 
Time deposits:                
Maturing within 3 months   9,240,060    464,810    2,104,580    11,809,450 
Maturing after 3 but within 6 months   1,570,798    247,897    707,516    2,526,211 
Maturing after 6 but within 12 months   1,161,547    152,448    94,304    1,408,299 
Maturing after 12 months   125,793    58,191    11,381    195,365 
Total deposits   12,098,198    923,346    2,917,781    15,939,325 

 

91

 

 

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.

 

   2023   2022   2021 
   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   779,214    7.2%   450,632    3.7%   135,078    0.7%
Obligations with the Central Bank   5,773,345    12.2%   5,441,584    8.5%   5,546,895    0.9%
Loans from domestic financial institutions   55,839    7.0%   26,947    10.5%   98,425    0.0%
Foreign obligations   3,421,666    6.9%   3,426,605    2.3%   2,380,327    43.6%
Total Short-term borrowings   10,030,064    10.0%   9,345,768    6.0%   8,160,725    13.4%

 

The following table presents the maximum month-end balances of our principal sources of short-term borrowings during the years indicated.

 

   Maximum 2023
Month-End
Balance
   Maximum 2022
Month-End
Balance
   Maximum 2021
Month-End
Balance
 
   (in millions of Ch$) 
Obligations under repurchase agreements   1,161,741    811,731    128,218 
Obligations with the Central Bank   6,048,867    5,584,084    6,025,781 
Loans from domestic financial institutions   225,604    237,870    187,000 
Foreign obligations   4,271,414    3,890,552    3,453,642 
Total short-term borrowings   11,707,626    10,524,237    9,794,641 

 

92

 

 

Total Borrowings

 

   As of December 31, 2023 
   Long-term   Short-term   Total 
   (in millions of Ch$) 
Loans from Central Bank (a)       6,048,867    6,048,867 
Obligations under repurchase agreements       282,584    282,584 
Mortgage finance bonds (b)   254    975    1,229 
Senior bonds (c)   6,076,323    1,849,062    7,925,385 
Mortgage bonds(d)   74,431        74,431 
Regulatory capital financial instruments(e)   1,813,939        1,813,939 
Borrowings from domestic financial institutions       46,218    46,218 
Foreign borrowings(f)   477,801    3,793,613    4,271,414 
Other obligations(g)   178    296,095    296,273 
Total borrowings   8,442,926    12,317,414    20,760,340 

 

   As of December 31, 2022 
   Long-term   Short-term   Total 
   (in millions of Ch$) 
Central Bank credit lines for renegotiations of loans (a)   5,584,084        5,584,084 
Obligations under repurchase agreements       315,355    315,355 
Mortgage finance bonds (b)   1,206    2,592    3,798 
Senior bonds (c)   6,597,776    482,696    7,080,472 
Mortgage bonds(d)   74,515    7,108    81,623 
Regulatory capital financial instruments(e)   1,733,870        1,733,870 
Borrowings from domestic financial institutions       41,318    41,318 
Foreign borrowings(f)       3,239,363    3,239,363 
Other obligations(g)   239    292,756    292,995 
Total borrowings   13,991,690    4,381,188    18,372,878 

 

   As of December 31, 2021 
   Long-term   Short-term   Total 
   (in millions of Ch$) 
Central Bank credit lines for renegotiations of loans (a)   5,611,439        5,611,439 
Obligations under repurchase agreements       86,634    86,634 
Mortgage finance bonds (b)   3,533    3,946    7,479 
Senior bonds (c)   5,688,533    1,158,301    6,846,834 
Mortgage bonds(d)   75,069    6,041    81,110 
Regulatory capital financial instruments(e)   1,461,637        1,461,637 
Borrowings from domestic financial institutions       1,226    1,226 
Foreign borrowings(f)       3,213,918    3,213,918 
Other obligations(g)   261    182,646    182,907 
Total borrowings   12,840,472    4,652,712    17,493,184 

 

93

 

 

(a) Loans from Central Bank

 

In response to the COVID-19 pandemic, the Central Bank made two lines of credit available to banks to reinforce their liquidity and to fund loans for SMEs with government guarantees. These lines of credit bear interest at the Central Bank’s monetary policy rate (MPR), which was 0.5% at the time the lines of credit were granted.

 

   As of
December 31,
2023
 
   (in millions of
Ch$)
 
Due within 1 year    6,048,867 
Due within 1 and 2 year    
Due within 2 and 3 year    
Due within 3 and 4 year    
Due after 5 years    
Total loans from Chilean Central Bank   6,048,867 

 

(b) Mortgage finance bonds

 

These bonds are used to finance mortgage loans. Their principal amounts are amortized on a quarterly basis. The range of maturities of these bonds is between five and twenty years. Loans are indexed to UF and pay a yearly interest rate.

 

   As of
December 31,
2023
 
   (in millions of
Ch$)
 
Due within 1 year   975 
Due after 1 year but within 2 years   254 
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    1,229 

 

94

 

 

(c) Senior bonds

 

The following table sets forth, at the dates indicated, our issued senior bonds. The bonds are denominated principally in UFs or U.S. dollars, and are principally used to fund assets with similar durations.

 

   As of December 31, 
   2023   2022   2021 
   (in millions of Ch$) 
Senior Bonds in UF   3,632,979    3,510,708    3,144,544 
Senior Bonds in U.S.$   2,424,045    2,215,515    1,976,909 
Senior Bonds in CHF   637,203    644,780    850,924 
Senior Bonds in Ch$   619,386    223,467    311,060 
Current bonds in AUD   116,515    122,611    143,030 
Santander bonds in JPY   323,922    203,512    234,667 
Senior bonds in EUR   171,335    159,879    185,700 
Total senior bonds    7,925,385     7,080,472     6,846,834 

 

The maturities of these bonds are as follows:

 

   As of
December 31,
2023
 
   (in millions of
Ch$)
 
Due within 1 year   1,849,062 
Due after 1 year but within 2 years   1,577,424 
Due after 2 years but within 3 years   1,395,929 
Due after 3 years but within 4 years   559,331 
Due after 4 years but within 5 years   573,349 
Due after 5 years   1,970,290 
Total bonds    7,925,385 

 

In 2023, the Bank issued the following bonds:

 

Series  Currency  Amount   Term
(years)
  Issuance rate
(% annual)
  Placement
date
  Series Maximum
amount
  Maturity date
W3  UF   2,004,000   7.5  1.60  12-01-18  02-21-23  06-01-26
W5  UF   1,920,000   9  1.80  03-01-19  01-19-23  03-01-28
AA13  UF   1,205,000   6  3.40  09-01-23  11-23-23  09-01-2029
Total UF      7,719,000                
U7  CLP   3,000,000,000   5.5  7.00  03-01-22  02-24-23  09-01-27
T18  CLP   75,000,000,000   5.5  7.50  06-01-22  01-09-23  12-01-27
AA7  CLP   67,650,000,000   3.5  6.80  02-24-23  02-24-23  08-01-26
AA1  CLP   100,000,000,000   6.0  6.60  03-13-23  03-13-23  12-01-28
AA3  CLP   100,000,000,000   8.0  6.20  03-16-23  03-16-23  09-01-30
AA10  CLP   25,000,000,000   3.0  7.10  03-01-23  06-09-23  03-01-26
AA8  CLP   32,500,000,000   4.5  6.70  03-01-23  06-13-23  09-01-27
AA2  CLP   18,250,000,000   6.5  6.2  12-01-22  12-05-23  06-01-2029
AA9  CLP   3,000,000,000   8.0  6.3  11-01-22  12-20-23  11-01-2030
Total CLP      424,400,000,000                
Bond USD  USD   30,000,000   1.0  5.84  04-12-23  04-19-23  04-19-24
Total USD      30,000,000                
Bond JPY  JPY   10,500,000,000   1.0  0.60  04-24-23  04-28-23  04-28-24
Bond JPY  JPY   7,000,000,000   2.0  0.78  05-24-23  05-30-23  05-30-25
Bond JPY  JPY   8,000,000,000   2.0  0.78  10-20-23  10-27-23  10-27-25
Total JPY      25,500,000,000                

 

95

 

 

In 2022, the Bank issued bonds for UF 26,326,000, USD 30,000,000, CLP 347,000,000,000 and JPY 3,000,000,000, detailed as follows:

 

Series  Currency  Amount   Term
(years)
  Issuance rate
(% annual)
  Placement
date
  Series
Maximum
amount
   Maturity date
T3  UF   5,000,000   11  1.55  06-16-22   5,000,000   01-01-30
W3  UF   2,116,000   7.5  1.60  06-30-22   2,116,000   06-01-26
W5  UF   1,210,000   9  1.80  06-30-22   1,210,000   03-01-28
U2  UF   3,000,000   11.5  2.8  07-28-22   3,000,000   06-01-32
U1  UF   3,000,000   7.5  2.5  08-09-22   3,000,000   06-01-29
T20  UF   5,000,000   11.5  2.65  10-24-22   5,000,000   02-01-34
W4  UF   8,000,000   10.5  2.65  12-09-22   8,000,000   12-01-33
W9  UF   2,000,000   9.5  2.70  07-27-22   2,000,000   06-01-31
Total      29,326,000             29,326,000    
Bono USD  USD   30,000,000   3  Sofr + 95pb  04-28-22   30,000,000   04-28-25
Total      30,000,000             30,000,000    
U6  CLP   64,800,000,000   5.5  2.95  06-16-22   64,800,000,000   04-01-26
U5  CLP   100,000,000,000   4.5  2.70  06-29-22   93,000,000,000   04-01-25
U6  CLP   35,200,000,000   5.5  2.95  10-21-22   35,200,000,000   04-01-26
U7  CLP   72,000,000,000   5.5  7  11-16-22   72,000,000,000   04-01-26
T17  CLP   75,000,000,000   10  7.5  11-22-22   75,000,000,000   08-01-32
Total      347,000,000,000             347,000,000,000    
Bono JPY  JPY   3,000,000,000   3  0.65  09-15-2022   3,000,000,000   09-15-25
Total      3,000,000,000             3,000,000,000    

 

(d) 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.

 

96

 

 

The maturities of our mortgage bonds are as follows:

 

   As of December 31, 
   2023   2022 
   (in millions of Ch$) 
Due within 1 year       7,108 
Due after 1 year but within 2 years   13,997    11,411 
Due after 2 year but within 3 years   14,398    11,779 
Due after 3 year but within 4 years   14,812    12,159 
Due after 4 year but within 5 years   15,240    12,551 
Due after 5 years   15,984    26,615 
Total mortgage bonds   74,431    81,623 

 

During 2023 and 2022, the Bank did not place any mortgage bonds.

 

(e) 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.

 

   As of December 31, 
   2023   2022   2021 
   (in millions of Ch$) 
Subordinated bonds linked to the U.S.$   175,234    169,835    230,118 
Subordinated bonds linked to the UF   1,638,705    1,564,034    1,231,519 
Total subordinated bonds   1,813,939    1,733,869    1,461,637 

 

The maturities of these bonds, which are considered long-term, are as follows.

 

   As of
December 31,
2023
 
   (in millions of
Ch$)
 
Due within 1 year    
Due after 1 year but within 2 years    
Due after 2 years but within 3 years   188,869 
Due after 3 years but within 4 years    
Due after 4 years but within 5 years   110,296 
Due after 5 years   1,514,774 
Total subordinated bonds   1,813,939 

 

97

 

 

During 2023, the Bank did not issue subordinated bonds. During 2022, the Bank issued the following subordinated bond:

 

   Currency   Placement
amount
   Interest rate   Term  Placement date  Maturity date
USTDW70320   UF    3,300,000    3.51%  6 years  01-07-2022  09-01-2028

 

(f) Foreign borrowings

 

These are short-term and long-term borrowings from foreign banks used to fund our foreign trade business. The maturities of these borrowings are as follows.

 

   As of
December 31,
2023
 
   (in millions of
Ch$)
 
Due within 1 year   3,793,613 
Due after 1 year but within 2 years   304,384 
Due after 2 years but within 3 years    
Due after 3 years but within 4 years   173,417 
Due after 5 years    
Total loans from foreign financial institutions   4,271,414 

 

(g) Other obligations

 

Other obligations are summarized as follows:

 

   As of
December 31,
2023
 
   Ch$ million 
Long term obligations:     
Due after 1 years but within 2 years   78 
Due after 2 years but within 3 years   86 
Due after 3 years but within 4 years   14 
Due after 4 years but within 5 years    
Due after 5 years    
Long-term financial obligations subtotals   178 
Short term obligations:     
Amounts due to credit card operators   171,529 
Acceptance of letters of credit    
Other long-term financial obligations, short-term portion   124,566 
Short-term financial obligations subtotals   296,095 
Other financial obligations totals   296,273 

 

98

 

 

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, 2023, 2022 and 2021:

 

   As of December 31, 
   2023   2022   2021 
   (in millions of Ch$) 
Personal guarantees   494,104    924,173    579,051 
Letter of credits of merchandise traffic operations   262,496    255,522    377,308 
Transactions related to contingent events   1,641,510    1,476,599    1,390,410 
Unrestricted prompt cancel credit lines   9,490,141    8,974,077    8,986,535 
Other credit commitments   314,318    314,962    265,517 
Total   12,202,569    11,945,333    11,598,821 

 

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.

 

Capital Expenditures

 

The following table reflects capital expenditures in each of the three years ended December 31, 2022, 2021 and 2020:

 

   Year Ended December 31, 
   2023   2022   2021 
   (in millions of Ch$) 
Land and Buildings   31,574    26,690    16,688 
Machinery, Systems and Equipment   25,697    14,941    36,275 
Furniture, Vehicles, Other(1)   28,875    47,969    29,614 
Software development   45,067    54,899    47,487 
Total   131,213    144,499    130,064 

 

(1)Includes assets ceded under operating leases.

 

During 2023 the Bank focused its investments in the continued transformation of its branch network through the opening of its Workcafe branches, which is reflected in the increase in capital expenditures in land and buildings. The decrease in capital expenditures in 2023 was due to lower investments in software development and lower investments in furniture, vehicles and other fixed assets.

 

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.”

 

99

 

 

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 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.

  

100

 

 

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, 2023, 2022 and 2021.

 

   For the year ended December 31, 
   2023   2022   2021 
   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$   1,151,196    11,367    1.0%   489,899    19,503    4.0%   1,317,498    4,731    0.4%
UF           %           %           %
Foreign currency           %           %           %
Total   1,151,196    11,367    1.0%   489,899    19,503    4.0%   1,317,498    4,731    0.4%
Financial investments (1)                                             
Ch$   6,870,255    312,529    4.5%   6,158,172    174,066    2.8%   4,134,617    99,782    2.4%
UF   1,948,039    15,401    0.8%   1,881,946    36,466    1.9%   1,634,550    42,939    2.6%
Foreign currency   2,032,147    23,155    1.1%   2,002,023        %   3,398,637    9,264    0.3%
Total   10,850,441    351,085    3.2%   10,042,141    210,532    2.1%   9,167,803    151,986    1.7%
Commercial Loans                                             
Ch$   7,514,142    990,169    13.2%   7,420,641    728,650    9.8%   7,927,561    406,497    5.1%
UF   6,404,622    630,575    9.8%   6,776,739    1,231,218    18.2%   6,470,164    562,282    8.7%
Foreign currency   3,605,705    221,816    6.2%   3,677,328    137,280    3.7    2,763,604    90,482    3.3%
Total   17,524,469    1,842,560    10.5%   17,874,708    2,097,148    11.7%   17,161,329    1,059,260    6.2%
Consumer loans                                             
Ch$   5,141,105    786,598    15.3%   4,826,207    629,334    13.0%   4,602,144    479,956    10.4%
UF   10,513    507    4.8%   13,143    1,521    11.6%   11,912    1,270    10.7%
Foreign currency   72,816    5    %   70,960    5    %   52,089        %
Total   5,224,434    787,110    15.1%   4,910,309    630,860    12.8%   4,666,145    481,227    10.3%
Mortgage loans                                             
Ch$   7,660    17    0.2%   1,696    22    1.3%   2,489    64    2.6%
UF   16,306,409    1,287,251    7.9%   14,685,885    1,102,944    7.5%   12,972,976    670,942    5.2%
Foreign currency           %           %           %
Total   16,314,069    1,287,268    7.9%   14,687,581    1,102,966    7.5%   12,975,465    671,006    5.2%
Interbank loans                                             
Ch$   5,541    579    10.4%   11,260    925    8.2%   19,060    429    2.2%
UF           %           %           %
Foreign currency           %           %           %
Total   5,541    579    10.4%   11,260    925    8.2%   19,060    429    2.2%
Investment agreements to resell                                             
Ch$   21,952        %   3,629    433    11.9%   6,185    355    5.7%
UF       71    %           %   28    2    8.0%
Foreign currency           %   1,268    56    4.4%           %
Total   21,952    71    0.0%   4,897    489    10.0%   6,213    357    5.7%
Threshold (2)                                             
Ch$   984,360    9,564    1.0%   842,451    44,607    5.3%   172,242    467    0.3%
UF   2        %           %    89,568        %
Foreign currency   2,515,723    114,388    4.5%   2,219,946        %   953,774    732    0.1%
Total   3,500,085    123,952    3.5%   3,062,397    44,607    1.5%   1,215,583    1,199    0.1%

 

   For the year ended December 31, 
   2023   2022   2021 
   Average
Balance
   Interest
Earned
   Average
Nominal
Rate
   Average
Balance
   Interest
Earned
   Average
Nominal
Rate
   Average
Balance
   Interest
Earned
   Average
Nominal
Rate
 
Total interest earning assets                                    
Ch$   21,696,211    2,110,823    9.7%   19,753,955    1,597,540    8.1%   18,181,795    992,281    5.5%
UF   24,669,585    1,933,805    7.8%   23,357,713    2,372,149    10.2%   21,179,197    1,277,436    6.0%
Foreign currency   8,226,391    359,364    4.4%   7,971,524    137,341    1.7%   7,168,103    100,478    1.4%
Total   54,592,187    4,403,992    8.1%   51,083,192    4,107,030    8.0%   46,529,096    2,370,195    5.1%
                                              
Cash                                             
Ch$   1,147,881              1,245,813              784,836           
UF   1,190              1,393                         
Foreign currency   149,615              121,113              92,392           
Total   1,298,686              1,368,319              877,228           
Allowance for loan losses                                             
Ch$   (1,285,860)             (1,162,923)             (1,164,182)          
UF                                          
Foreign currency   (125,624)             (116,716              (16,193)          
Total   (1,411,484)                     (1,279,639)                  (1,180,375)               

 

101

 

 

   For the year ended December 31, 
   2023   2022   2021 
   Average
Balance
   Interest
Earned
   Average
Nominal
Rate
   Average
Balance
   Interest
Earned
   Average
Nominal
Rate
   Average
Balance
   Interest
Earned
   Average
Nominal
Rate
 
Fixed assets                                             
Ch$   109,720              99,152              201,730           
UF                                          
Foreign currency                                          
Total   109,720              99,152              201,730           
Derivatives                                             
Ch$   11,915,184              12,804,979              7,231,880           
UF                                          
Foreign currency                 (39)                        
Total   11,915,184              12,804,940              7,231,880           
Financial Investment (Trading)                                             
Ch$   78,500              97,396              1,086,865           
UF   85,377              84,546              46,127           
Foreign currency   695,497              1,022,075              344,063           
Total   859,374              1,204,017              1,477,055           
Other assets                                             
Ch$   1,433,356              3,446,277              1,495,030           
UF   78,050              69,413              465,603           
Foreign currency   662,652              590,837              769,986           
Total   2,174,058              4,106,527              2,730,619           
Total non-interest earning assets                                             
Ch$   13,398,781              16,530,694              9,636,160           
UF   164,617              155,352              511,730           
Foreign currency   1,382,140              1,617,270              1,190,249           
Total   14,945,538              18,303,316              11,338,138           
                                              
Total assets                                             
Ch$   35,094,992    2,110,823         36,284,649    1,597,540         27,817,954    992,281      
UF   24,834,202    1,933,805         23,513,065    2,372,149         21,690,927    1,277,436      
Foreign currency   9,608,531    359,364         9,588,794    137,341         8,358,352    100,478      
Total   69,537,725    4,403,992         69,386,508    4,107,030         57,867,233    2,370,195      

 

    For the year ended December 31,  
    2023     2022     2021  
    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$     10,798       281       2.6 %     3,869       10       0.3 %     3,656       9       0.3 %
UF     179,671       6,562       3.7 %     194,609       22,449       11.5 %     174,124       10,506       6.0 %
Foreign currency                                                  
Total     190,469       6,843       3.6 %     198,478       22,459       11.3 %     177,779       10,515       5.9 %
Time deposits                                                                        
Ch$     11,007,900       1,115,853       10.1 %     8,658,972       720,600       8.3 %     8,464,907       61,391       0.7 %
UF     1,125,964       95,029       8.4 %     794,934       108,714       13.7 %     180,258       14,174       7.9 %
Foreign currency     4,258,929                 4,660,901                 4,529,125       5,656       0.1 %
Total     16,392,793       1,210,882       7.4 %     14,114,807       829,314       5.9 %     13,174,290       81,221       0.6 %
Central bank borrowings                                                                        
Ch$     5,773,345       703,113       12.2 %     5,441,584       464,758       8.5 %     5,546,895       52,642       0.9 %
UF                                                
Foreign currency                                                
Total     5,773,345       703,113       12.2 %     5,441,584       464,758       8.5 %     5,546,895       52,642       0.9 %

 

102

 

 

    For the year ended December 31,  
    2023     2022     2021  
    Average
Balance
    Interest
Earned
    Average
Nominal
Rate
    Average
Balance
    Interest
Earned
    Average
Nominal
Rate
    Average
Balance
    Interest
Earned
    Average
Nominal
Rate
 
Repurchase Agreements                                                                        
Ch$     397,017       35,597       9.0 %     125,837       16,847       13.4 %     121,446       999       0.8 %
UF                           11                 1       % 
Foreign currency     382,197       20,184       5.3 %     324,795                 13,632            
Total     779,214       55,781       7.2 %     450,632       16,858       3.7 %     135,078       1,000       0.7 %
Mortgage finance bonds                                                                        
Ch$                 %                                   —%  
UF     2,063       192       9.3 %     5,058       874       17.3 %     9,105       991       10.9 %
Foreign currency                                                
Total     2,063       192       9.3 %     5,058       874       17.3 %     9,105       991       10.9 %
Commercial paper                                                                        
Ch$                 %                 %                
UF                  %                                
Foreign currency     613,212       35,772       5.8 %     298,142       7,137       2.4 %     277,666       716       0.3 %
Total     613,212       35,772       5.8 %     298,142       7,137       2.4       277,666       716       0.3 %
Other interest bearing  liabilities                                                                        
Ch$     3,859,742       819,756       21.2 %     3,038,893       314,537       10.4 %     1,012,965       10,370       1.0 %
UF     5,184,297       463,172       8.9 %     4,730,899       866,326       18.3 %     4,724,054       348,387       7.4 %
Foreign currency     5,876,169       15,432       0.3 %     6,680,180       14,655       0.2 %     4,044,352       69,579       1.7 %
Total     14,920,208       1,298,360       8.7 %     14,449,972       1,195,518       8.3 %     9,781,372       428,336       4.4 %
Total interest bearing liabilities                                                                        
Ch$     21,048,802       2,674,600       12.7 %     17,269,155       1,516,752       8.8 %     15,149,870       125,410       0.8 %
UF     6,491,995       564,955       8.7 %     5,725,500       998,374       17.4 %     5,087,541       374,059       7.4 %
Foreign currency     11,130,507       71,388       0.6 %     11,964,018       21,792       0.2 %     8,864,775       75,951       0.9 %
Total     38,671,304       3,310,943       8.6 %     34,958,674       2,536,918       7.3 %     29,102,186       575,420       2.0 %

 

103

 

 

 

    For the year ended December 31,  
    2023     2022     2021  
    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$     10,754,65                             12,414,155                           13,652,135                      
UF     89,127                       92,488                       72,007                  
Foreign currency     256,083                       338,171                       311,100                  
Total     11,099,86                       12,844,814                       14,035,242                  
Derivatives                                                                        
Ch$     10,937,254                       11,979,326                       7,666,801                  
UF                                                                  
Foreign currency     157                       (50 )                                      
Total     10,937,411                       11,979,276                       7,666,801                  
Other non-interest bearing liabilities                                                                        
Ch$     1,768,888                       4,105,928                       1,249,442                  
UF     445,842                       384,484                       752,420                  
Foreign currency     1,894,120                       1,589,269                       998,736                  
Total     4,108,850                       6,079,681                       3,000,598                  
Shareholders’ equity                                                                        
Ch$     4,720,294                       3,524,063                       3,485,008                  
UF                                                                  
Foreign currency                                                 577,399                  
Total     4,720,294                       3,524,063                       4,062,407                  
                                                                         
Total non-interest bearing liabilities and shareholders’ equity                                                                        
Ch$     28,181,092                       32,023,472                       26,053,386                  
UF     534,969                       476,972                       824,426                  
Foreign currency     2,150,360                       1,927,390                       1,887,236                  
Total     30,866,421                       34,427,834                       28,765,048                  
                                                                         
Total Liabilities and Shareholders’ Equity                                                                        
Ch$     49,229,894       2,674,600               49,292,628       1,516,752               41,203,255       125,410          
UF     7,026,964       564,955               6,202,472       998,374               5,911,968       374,059          
Foreign currency     13,280,867       71,388               13,891,408       21,792               10,752,010       75,951          
Total     69,537,725       3,310,943               69,386,508       2,536,918               57,867,233       575,420          

 

(1)This line item includes debt instruments at fair value through other comprehensive income according to IFRS 9.

 

104

 

 

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 2023 compared to 2022 and 2022 compared to 2021. 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 2022 to 2023
Due to Changes in
   Increase (Decrease) from 2021 to 2022
Due to Changes in
 
   Volume   Rate   Net Change from 2022 to 2023   Volume   Rate   Net Change from 2021 to 2022 
ASSETS                        
Interest earning assets                        
Deposits in Central Bank                        
Ch$   (4,880)   (3,256)   (8,136)   11,045    3,726    14,772 
UF                        
Foreign currency                        
Subtotal   (4,880)   (3,256)   (8,136)   11,045    3,726    14,772 
Financial investments                              
Ch$   (157,121)   295,584    138,463    103,655    (29,371)   74,284 
UF   (4,667)   (16,398)   (21,065)   (2,894)   (3,580)   (6,473)
Foreign currency   (4,218)   27,374    23,155    (8,977)   (287)   (9,264)
Subtotal   (166,006)   306,560    140,553    91,784    (33,237)   58,546 
Commercial loans                              
Ch$   (2,577)   264,096    261,519    8,698    313,456    322,153 
UF   (19,351)   (581,292)   (600,643)   4,499    664,437    668,936 
Foreign currency   5,549    78,987    84,536    41,834    4,964    46,798 
Subtotal   (16,379)   (238,209)   (254,588)   55,031    982,856    1,037,888 
Consumer loans                              
Ch$   939    156,325    157,264    7,663    141,715    149,378 
UF   42    (1,056)   (1,014)   63    188    251 
Foreign currency               5        5 
Subtotal   981    155,269    156,250    7,730    141,903    149,633 
Mortgage loans                              
Ch$   (4)   (1)   (5)   (119)   77    (42)
UF   1,054,715    (870,408)   184,307    (44,295)   476,297    432,002 
Foreign currency                        
Subtotal   1,054,710    (870,408)   184,302    (44,414)   476,373    431,960 
Interbank loans                              
Ch$   (226)   (120)   (346)   173    324    496 
UF                        
Foreign currency                        
Subtotal   (226)   (120)   (346)   173    324    496 
Investment under agreements to resell                              
Ch$   (22)   (411)   (433)   10    68    78 
UF               (2)       (2)
Foreign currency   (56)       (56)       56    56 
Subtotal   (78)   (411)   (489)   8    124    132 
TRESHOLD                              
Ch$   (6,357)   (28,686)   (35,043)   2,320,858    (2,276,718)   44,140 
UF                        
Foreign currency   (50,503)   164,891    114,388    (740)   8    (732)
Subtotal   (56,859)   136,204    79,345    2,320,118    (2,276,710)   43,408 
Total interest earning assets                              
Ch$   (170,248)   683,531    513,283    2,451,983    (1,846,724)   605,259 
UF   1,030,740    (1,469,155)   (438,415)   (42,628)   1,137,341    1,094,713 
Foreign currency   (49,228)   271,252    222,023    32,122    4,741    36,863 
Total   811,263    (514,372)   296,891    2,441,476    (704,641)   1,736,835 

 

105

 

 

   Increase (Decrease) from 2022 to 2023
Due to Changes in
   Increase (Decrease) from 2021 to 2022
Due to Changes in
 
   Volume   Rate   Net Change from 2022 to 2023   Volume   Rate   Net Change from 2021 to 2022 
LIABILITIES AND SHAREHOLDERS’ EQUITY                        
Interest bearing liabilities                        
Savings accounts                        
Ch$   404    (133)   271    1        1 
UF   189    (16,076)   (15,887)   (247)   12,191    11,943 
Foreign currency                        
Subtotal   592    (16,208)   (15,616)   (247)   12,190    11,944 
Time deposits                              
Ch$   195,478    199,775    395,253    1,407    657,802    659,209 
UF   631    (14,316)   (13,685)   7,492    87,048    94,540 
Foreign currency               (8,930)   3,274    (5,656)
Subtotal   196,109    185,459    381,568    (31)   748,124    748,093 
Central Bank borrowings                              
Ch$   (15,082)   253,437    238,355    6,009    406,107    412,116 
UF                        
Foreign currency                        
Subtotal   (15,082)   253,437    238,355    6,009    406,107    412,116 
Repurchase agreements                              
Ch$   (1,672)   20,422    18,750    (265)   16,113    15,848 
UF       (11)   (11)       10    10 
Foreign currency   (10,253)   30,437    20,184             
Subtotal   (11,926)   50,849    38,923    (265)   16,123    15,858 
Mortgage finance bonds                              
Ch$                        
UF   (287)   (395)   (682)   89    (206)   (117)
Foreign currency                        
Subtotal   (287)   (395)   (682)   89    (206)   (117)
Commercial papers                              
Ch$                        
UF                        
Foreign currency   91,698    (63,063)   28,635    1,809    4,613    6,421 
Subtotal   91,698    (63,063)   28,635    1,809    4,613    6,421 
Other interest bearing liabilities                              
Ch$   (22,286)   527,505    505,219    (211,319)   515,486    304,167 
UF   19,288    (422,442)   (403,154)   13    517,926    517,939 
Foreign currency   756    21    777    (75,762)   20,837    (54,924)
Subtotal   (2,241)   105,083    102,842    (287,067)   1,054,249    767,182 
Total interest bearing liabilities                              
Ch$   156,841    1,001,007    1,157,848    (204,166)   1,595,508    1,391,342 
UF   19,821    (453,240)   (433,419)   7,347    616,968    624,315 
Foreign currency   (9,497)   30,458    20,961    (84,692)   24,112    (60,580)
Total   167,166    578,224    745,390    (281,511)   2,236,588    1,955,076 

 

106

 

 

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.

 

   Year ended December 31, 
   2023   2022   2021 
   (in millions of Ch$) 
Total average interest-earning assets               
Ch$   21,696,211    19,753,955    18,181,795 
UF   24,669,585    23,357,713    21,179,197 
Foreign currencies   8,226,391    7,971,524    7,168,103 
Total   54,592,187    51,083,192    46,529,096 
Net interest earned(1)               
Ch$   (563,777)   80,788    866,871 
UF   1,368,850    1,373,775    903,377 
Foreign currencies   287,976    115,549    24,527 
Total   1,093,049    1,570,112    1,794,775 
Net interest margin(2)               
Ch$   (2.6)   0.4    4.8 
UF   5.5    5.9    4.3 
Foreign currencies   3.5    1.4    0.3 
Total   2.0%   3.1%   3.9%

 

(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.

 

107

 

 

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.

 

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.

 

108

 

 

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.

 

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, 2023.

 

   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, 2023
 
   (in millions of Ch$) 
Interbank loans   68,440                68,440 
                          
Commercial loans   6,103,354    4,665,521    2,100,291    367,271    13,236,437 
Foreign trade loans   1,873,466    67,488    1,723        1,942,677 
Checking accounts debtors   143,732    8    3        143,743 
Credit card debtors   62,250    75,898    69        138,217 
Factoring transactions   1,020,523    50            1,020,573 
Leasing transactions   349,622    674,091    215,134    130    1,238,977 
Student loans   7,708    19,819    18,452    1,105    47,084 
Other loans and account receivable   265,104    38,536    243    66    303,949 
SUBTOTAL Commercial loans   9,825,759    5,541,411    2,335,915    368,572    18,071,657 
Loans with mortgage finance bonds   437    37            474 
Endorsable mortgage mutual loans   648    387    47        1,082 
Mortgage mutual financed with mortgage bonds   7,245    28,638    46,105    8,772    90,760 
Other mortgage mutual loans   992,148    3,933,582    7,777,888    4,202,372    16,905,990 
Other credit and account receivable   3,562    14,198    34,219    23,154    75,133 
SUBTOTAL Mortgage loans   1,004,040    3,976,842    7,858,259    4,234,298    17,073,439 
Installment consumer loans   1,325,283    2,306,075    77,514    12    3,708,884 
Checking accounts debtors   150,947    4    3        150,954 
Credit card debtors   599,649    1,135,506    634        1,735,789 
Leasing transactions   1,107    974    1        2,082 
Other consumer loans   637    2    2        641 
SUBTOTAL Consumer loans   2,077,623    3,442,561    78,154    12    5,598,350 
Total   12,975,862    12,960,814    10,272,328    4,602,882    40,811,886 

 

109

 

 

The following tables present the total amount of loans due after one year that have fixed and variable interest rates as of December 31, 2023 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, 2023 
   (in millions of Ch$) 
   Variable Interest
Rates
   Fixed Interest
Rates
 
Interbank   68,440    - 
           
Commercial loans   10,834,138    2,402,299 
Foreign trade loans   1,726,257    216,420 
Checking accounts debtors   13,300    130,443 
Credit card debtors   138,217     
Factoring transactions   1,020,573     
Leasing transactions   47,084     
Student loans   1,222,299    16,678 
Other loans and account receivable   303,949     
Subtotals   15,305,817    2,765,840 
Loans with mortgage finance bonds   474     
Endorsable mortgage mutual loans   1,082     
Mortgage mutual financed with mortgage bonds   90,760     
Other mortgage mutual loans   11,850,343    5,055,647 
Other credit and account receivable   67,302    7,831 
Subtotals   12,009,961    5,063,478 
Installment consumer loans   3,708,445    439 
Checking accounts debtors   9,414    141,540 
Credit card debtors   1,735,789     
Leasing transactions   2,082     
Other consumer loans   641     
Subtotals   5,456,371    141,979 
Totals loans to clients   32,840,589    7,971,297 

 

110

 

 

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.

 

   2023   2022 
   (Ch$ million) 
Total loans   40,811,886    38,729,401 
Allowance for loan losses   1,149,991    1,153,267 
Impaired loans   2,189,613    1,682,496 
Impaired loans as a percentage of total loans   5.37%   4.34%
Amounts non-performing   923,852    717,411 
To the extent secured(1)   554,311    430,447 
To the extent unsecured   369,541    286,964 
Amounts non-performing as a percentage of total loans   2.26%   1.85%
To the extent secured(1)   1.36%   1.11%
To the extent unsecured   0.91%   0.74%
Loans loss allowances as a percentage of:          
Total loans   2.82%   2.98%
Total amounts non-performing   124.48%   160.75%
Total amounts non-performing – unsecured   311.19%   401.89%

 

(1) Security generally consists of mortgages on real estate, pledges of marketable securities, letters of credit or cash.

 

111

 

 

Credit Ratios

 

The following sets forth our credit ratios as of and for the years ended December 2023, 2022 and 2021 by loan category.

 

   As of and for the Year Ended December 31 
   2023   2021   2020 
   (in millions of Ch$) 
Allowance for credit losses to total loans outstanding   2.82%   2.98%   2.88%
Allowance for credit losses   1,149,991    1,153,267    1,051,434 
Total loans outstanding   40,811,886    38,729,401    36,529,062 
Net write-offs during the period to average loans outstanding:               
Commercial               
Interbank Loans               
Net charge-off during the period   -         
Average amount outstanding   34,163    11,260    19,060 
Ratio of net charge-off/average amount outstanding   %   %   %
Commercial Loans               
Net charge-off during the period   123,544    102,499    148,505 
Average amount outstanding   13,794,651    14,254,233    13,764,674 
Ratio of net charge-off/average amount outstanding   0.9%   0.7%   1.1%
Foreign Trade Loans               
Net charge-off during the period   -    0    10,358 
Average amount outstanding   1,828,177    1,646,604    1,318,946 
Ratio of net charge-off/average amount outstanding   0.0%   0.0%   0.8%
Checking Account Debtors               
Net charge-off during the period   3,462    4,962    6,341 
Average amount outstanding   137,208    144,773    120,034 
Ratio of net charge-off/average amount outstanding   2.5%   3.4%   5.3%
Factoring Transactions               
Net charge-off during the period   889    2,230    1,417 
Average amount outstanding   831,437    835,763    454,273 
Ratio of net charge-off/average amount outstanding   0.1%   0.3%   0.3%
Leasing Transactions               
Net charge-off during the period   2,267    9,976    8,792 
Average amount outstanding   50,103    1,347,664    1,319,618 
Ratio of net charge-off/average amount outstanding   4.5%   0.7%   0.7%
Student Loans               
Net charge-off during the period   7,468    1,624    1,311 
Average amount outstanding   1,287,533    54,366    59,246 
Ratio of net charge-off/average amount outstanding   0.6%   3.0%   2.2%
Other Loans and Accounts Receivable               
Net charge-off during the period   14,670    19,374    2 
Average amount outstanding   222,999    233,811    124,538 
Ratio of net charge-off/average amount outstanding   6.6%   8.3%   0.0%
Total Commercial               
Net charge-off during the period   155,511    140,665    176,726 
Average amount outstanding   18,317,077    18,528,474    17,180,389 
Ratio of net charge-off/average amount outstanding   0.8%   0.8%   1.0%
Residential               
Loans with Mortgage Finance Bonds               
Net charge-off during the period   24    19    23 
Average amount outstanding   1089    3,004    5,976 
Ratio of net charge-off/average amount outstanding   2.2%   0.6%   0.4%
Mortgage Mutual Loans financed with mortgage bonds               
Net charge-off during the period   7    4    907 
Average amount outstanding   95,701    87,415    88,349 
Ratio of net charge-off/average amount outstanding   0.0%   0.0%   1.0%
Other Mortgage Loans               
Net charge-off during the period   27,192    22,259    18,870 
Average amount outstanding   16,001,670    14,621,584    12,881,140 
Ratio of net charge-off/average amount outstanding   0.2%   0%   0.1%
Total Residential               
Net charge-off during the period   27,274    22,282    19,800 
Average amount outstanding   16,314,069    14,712,003    12,975,465 
Ratio of net charge-off/average amount outstanding   0.2%   0.2%   0.2%

 

112

 

 

   As of and for the Year Ended December 31 
   2023   2022   2021 
   (in millions of Ch$) 
Consumer Loans            
Installment Consumer Loans            
Net charge-off during the period   205,066    141,131    100,493 
Average amount outstanding   3,817,414    3,710,662    3,579,688 
Ratio of net charge-off/average amount outstanding   5.4%   3.8%   2.8%
Credit Card Balances               
Net charge-off during the period   65,912    32,156    18,143 
Average amount outstanding   1,541,871    1,328,114    1,083,252 
Ratio of net charge-off/average amount outstanding   4.3%   2.4%   1.7%
Consumer Leasing Contracts               
Net charge-off during the period   45    23    1 
Average amount outstanding   2,309    2,793    2,990 
Ratio of net charge-off/average amount outstanding   1.9%   0.8    0.0%
Other Consumer Loans               
Net charge-off during the period   3,139    1,594    4,848 
Average amount outstanding   857    480    215 
Ratio of net charge-off/average amount outstanding   366.3%   332.1%   2254.9%
Total Consumer               
Net charge-off during the period   274,162    174,904    123,485 
Average amount outstanding   5,362,451    5,042,049    4,666,145 
Ratio of net charge-off/average amount outstanding   5.1%   3.5%   2.6%
Total Loans               
Net charge-off during the period   456,947    337,851    320,011 
Average amount outstanding   39,993,597    38,282,526    34,821,999 
Ratio of net charge-off/average amount outstanding   1.1%   0.9%   0.9%

 

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 2023 and 2022, 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,
 
   2023   2022 
   (in millions of Ch$) 
Insured deposits   213,524    194,960 
Uninsured deposits   15,697,728    12,654,685 
Of which:          
Excess over guaranteed limit   646,492    642,292 
Otherwise uninsured   3,692,958    3,701,690 
Total   15,911,252    12,849,645 

 

113

 

 

   For the year ended December 31, 2023 
   Ch$   Foreign
currency
   Total 
   (in millions of Ch$) 
Time deposits otherwise uninsured with a maturity of:            
3 months or less   14,457,554    143,923    14,601,477 
Over 3 months through 6 months   724,915    65,696    790,611 
Over 6 months through 12 months   197,250    36,766    234,016 
Over 12 months   60,127    11,497    71,623 
Total   15,439,847    257,881    15,697,728 

 

ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

 

A. Directors and Senior Management Directors

 

We are managed by our Board of Directors, which, in accordance with our by-laws, consists of 9 directors and two alternates who are elected at our ordinary shareholders’ meetings. The current members of the Board of Directors were elected by the shareholders in the ordinary shareholders’ meeting held on April 30, 2023. Members of the Board of Directors are elected for three-year terms. The term of the current Board members expires in April of 2026.

 

Cumulative voting is permitted for the election of directors. The Board of Directors may appoint replacements to fill any vacancies that occur during periods between elections. If any member of the Board of Directors resigns before his or her term has ended, and no other alternate director is available to take the position at the next annual ordinary shareholders’ meeting a new replacing member will be elected. Our executive officers are appointed by the Board of Directors and hold office at its discretion. Scheduled meetings of the Board of Directors are held monthly. Extraordinary meetings can be held when called in one of three ways: by the Chairman of the Board of Directors, by three directors with the consent of the Chairman of the Board of Directors or by the majority of directors. None of the members of our Board of Directors has a service contract which entitles any Director to any benefits upon termination of employment with Santander-Chile.

 

Our current directors are as follows:

 

Directors  Position  Committees  Term
Expires
Claudio Melandri Hinojosa  President  Asset and Liability Committee
Remuneration Committee
Integral Risk Committee
Management Appointment Committee
  Apr-26
Rodrigo Vergara Montes  First Vice President  Audit Committee
Asset and Liability Committee (President)
Management Appointment Committee
  Apr-26
Orlando Poblete Iturrate  Second Vice President  Remuneration Committee  
Audit Committee (President)
  Apr-26
María Olivia Recart  Director  Integral Risk Committee
Asset and Liability Committee
  Apr-26
Felix de Vicente Mingo  Director  Asset and Liability Committee
Audit Committee
Integral Risk Committee
  Apr-26
Ana Dorrego de Carlos  Director    Apr-26
Rodrigo Echenique Gordillo  Director    Apr-26
Lucia Santa Cruz Sutil  Director  Integral Risk Committee  Apr-26
Blanca Bustamante Bravo  Director  Integral Risk Committee
Management Appointment Committee (President)
  Apr-26
Alfonso Gómez Morales  Alternate Director  Integral Risk Committee (President)
Remuneration Committee
Asset and Liability Committee
  Apr-26
Juan Pedro Santa Maria Perez  Alternate Director  Audit Committee (Secretary)
Integral Risk Committee
  Apr-26

 

114

 

 

Claudio Melandri Hinojosa became the Executive Chairman of Grupo Santander in Chile on February 27, 2018. He is also President of Santander Chile Holding S.A. and Vice President of Universia Chile S.A. He has more than 30 years of experience in the financial industry and was Chief Executive Officer of Santander Chile from January 2010 to March 2018 and was also Country Head until July 2022. He started his career in Banco Concepción and joined Grupo Santander in 1990, where he has held various positions of responsibility, including Regional Manager, Manager of the branch network, Human Resources Manager and Manager of Commercial Banking. He was also a Vice President at Banco Santander Venezuela for three years in the commercial area of this country. Mr. Melandri has degrees in Business and Accounting and holds a Master of Business Administration from Universidad Adolfo Ibañez.

 

Rodrigo Vergara became a director and First Vice President of the Board on July 12, 2018. He is a professor of Economics at Pontificia Universidad Católica de Chile and an economic consultant and board member for various companies. He graduated with an Economics Degree from the Pontificia Universidad Católica de Chile in 1985 and earned a Doctorate Degree in Economics from Harvard University in 1991. He is a researcher at the Center for Public Studies (CEP) and an associate researcher at the Harvard University School of Government (Kennedy School). He is the author of numerous articles published in specialized professional journals and has edited several books. Along with this, he is a professor of Economics at the Catholic University of Chile and is an economic consultant and member of the board of directors of several companies. He went to work at the Central Bank of Chile in 1985. Then he was at the Center for Public Studies and at the Catholic University of Chile. In 2009 he joined the Council of the Central Bank of Chile, assuming his position as president between 2011 and 2016. In addition, he has been an economic advisor to the central banks and governments of several countries and has been an external consultant to the World Bank, the International Monetary Fund, the Inter-American Bank Development and the United Nations.

 

Orlando Poblete Iturrate is the Second Vice President and has served on the Board since April 22, 2014. Since 1991, Mr. Poblete has been a professor at Universidad de los Andes. Between 1997 and 2004, he was Dean of the Law School at Universidad de los Andes and until 2014 he served as Chancellor. He is also a partner at the law firm Orlando Poblete & Company. He is a member of the Counsel of the Arbitration and Mediation of Santiago of the Chamber of Commerce of Santiago. Previously, between 1979 and 1991, he was a professor of Procedural Law at Universidad de Chile. Mr. Poblete is a lawyer from Universidad de Chile and has a Masters in Law from the same university. He is also a graduate of the Directive Management of Companies Program (PADE) of ESE Business School of Universidad de los Andes.

 

María Olivia Recart joined the Board in March 2023 as an alternate director and was voted to the Board in April 2023. She has a degree in Business Administration with a major in Economics from the University of Concepción and a Master of Arts in Economics from Georgetown. She has more than 25 years of experience in public policy, R&D, senior management of companies and non-profit organizations. She spent 16 years at Fundación Chile, and then served as undersecretary in the Ministry of Finance (2006-2010). At the end of 2010, she assumed as VP of Corporate Affairs for the Region of the Americas of the Australian mining company BHP. Between 2019 and 2023 she was National Chancellor of the Santo Tomás University (UST). She is president of the board of directors of Comunidad Mujer, director of Esval, Essbio, Lundin Mining and Aclara.

 

Félix de Vicente Mingo became a director on March 27, 2018. He has a Business degree with a specialization in Economics from Universidad de Chile. Between 2013 and 2014, he was Minister of Economy, Development and Tourism of Chile. Before this, he was a Trade Commissioner of ProChile, an institution of the Ministry of Foreign Affairs dedicated to promoting Chilean products abroad. In his career he has been president and partner of several companies both in Chile and abroad.

 

Ana Dorrego became a director on March 15, 2015. She has been working at the Santander Group since 2000 mainly in the Financial Planning and Corporate Development department, coordinating the Group’s planning processes and following up on the different Santander Group units and projects. She is currently a Directo of Caceis. She was director of E-business development for the Santander Group and previously she was a corporate client relationship manager and commercial director of transactional banking at Bankinter. Ms. Dorrego holds a degree in Business Administration from Universidad Pontificia de Comillas ICAI-ICADE, and a master’s degrees in Business Administration from Deusto University – Bilbao, Spain, and Adolfo Ibañez, Miami/Chile.

 

115

 

 

Rodrigo Echenique Gordillo became a director in March 2019. He has a law degree from Universidad Complutense de Madrid. He is president of Fundación Banco Santander and a non-executive director of Inditex. He has ample experience in international banking, having held positions as CEO and Vice President at Banco Santander. He has also been president of Santander Spain and president of Banco Popular. Likewise, he has had multiple responsibilities as president and member of the boards of directors of several industrial and financial companies.

 

Lucía Santa Cruz Sutil became a director on August 19, 2003. She is a Member of the Board of Universidad Adolfo Ibañez. She is director of Compañía de Seguros Generales y de Vida La Chilena Consolidada (Zurich) and is a member of the Advisory Board of Nestle Chile. She is a member of the Self-Regulation Committee for Insurance Companies in Chile. Ms. Santa Cruz is a historian and holds a Master in Philosophy in History from Oxford University and a Bachelor of Arts in History from King's College, University of London.

 

Blanca Bustamante Bravo became an alternate director on April 28, 2015 and was voted to the Board in April 2023. She holds a commercial engineering degree with mention in economics from Universidad Católica de Chile. Her professional experience includes the role of economic analyst for the Central Bank of Chile and research analyst for Oppenheimer & Co. in New York and IM Trust. In 1998, she joined Viña Concha y Toro as Head of Investor Relations, a position held until 2010. In 2001, she also became deputy manager of Corporate Communications and in 2017 was named Director of Corporative Affairs. Since 2013, she has been a director in the Center for Research & Innovation for Viña Concha y Toro. In 2023, she left her managerial position in Viña Concha y Toro and assumed as a board member.

 

Alfonso Gómez became a director on March 27, 2018 and an alternate director in April 2023. He has a Civil Engineering degree from Universidad Católica de Chile, and a Master of Design and a Ph.D. from the Royal College of Art of London. He is an advisor to the Innovation Center UC Anacleto Angelini. He started his career in the Industrial and System Engineering Department of Universidad Católica de Chile. He was founder of various companies, such as Apple Chile, Unlimited and Virtualia, the first social network developed in Latin America. He has been a director of numerous companies and institutions such as the National Council of Culture and the Arts, Fundación País Digital, the National Council of Innovation, Sonda, Derco, Puerto de Valparaíso, Corporación 3xi, Conecta Logística and Boma Chile. He was Dean of the Faculty of Engineering and later Dean of the Business School of Universidad Adolfo Ibáñez.

 

Juan Pedro Santa María Pérez became an alternate director in April 2023 after serving as a full Board member since July 24, 2012. He previously served as Corporate Legal Director for Grupo Santander in Chile, Legal Counsel for Santander-Chile, Banco O’Higgins and Banco Santiago. He was President of the Legal Committee of the Asociación de Bancos e Instituciones Financieras de Chile for over 20 years and President Pro-Tempore of the Financial Law Committee of the Federación Latinoamericana de Bancos (FELABAN). He is a member of the Counsel of Arbitrage and Mediation of the Chamber of Commerce of Santiago. Mr. Santa María holds a degree in Law from the Pontificia Universidad Católica de Chile.

 

116

 

 

Senior Management

 

Our senior managers are as follows:

 

Senior Manager  Position  Date
Appointed
Román Blanco  Chief Executive Officer  Aug-22
Pedro Orellana  Executive Vice-President of Retail Banking  Apr-21
Andres Trautmann  Executive Vice-President of Corporate and Investment Banking  May-21
Luis Araya  Executive Vice-President of Middle-Market  Apr-21
Emiliano Muratore  Chief Financial Officer  Apr-16
Guillermo Sabater  Financial & Cost Controller  Nov-15
Oscar Gomez  Executive Vice-President of Risk  Sep-23
Ricardo Bartel  Executive Vice-President of Technology and Operations  Jun-15
Paula Melendez  Executive Vice-President of Human Resources  Jun-23
Sergio Avila  Executive Vice-President of Administration and Global Payments  Mar-15
Claudia Heimpell  Executive Vice-President of Client Experience & Service Quality  Nov-22
Cristian Florence  General Counsel  Sep-12
Mey Lin Hernandez  Executive Vice President of Internal Audit  Sep-23
Jorge Valencia  Executive Vice-President of Wealth Management and Insurance  Nov-21
Fernando Larraín  Executive Vice-President of Communications, Marketing and Research  Jun-23
Jonathan Covarrubias  Chief Accounting Officer  May-19
Soledad Ramirez  Senior Manager Sustainable Finance & Climate Change  Mar-23

 

Román Blanco became the Chief Executive Officer and Country Head of Banco Santander Chile in August 2022. He has a Civil Engineering degree from University of Cantabria (Spain) and an MBA from Carnegie Mellon University (Pittsburgh, United States). He has 18 years of experience in the Group, which he joined in 2004 as vice president of Banco Santander Banespa in Sao Paulo, Brazil, where he was assigned the task of consolidating the role that this market played for the Group. In 2007 he was appointed president and CEO of Santander Colombia, whose strategy led to a revaluation of Santander in that country. In 2012, he assumed the same responsibilities in Puerto Rico, and was subsequently appointed as CEO of Santander Bank, NA and Santander Holdings in Boston, United States. He has also been responsible for the operations in the Andean region and Uruguay of the Santander Group and member of the board of Santander Uruguay, Santander Peru and Santander Colombia.

 

Pedro Orellana became the executive Vice-President of Retail Banking in April 2021. He has been part of the Santander Group for 27 years. He began his career in the Bank in 1995, where he has had various responsibilities, including serving as Manager of the Individuals and SMEs segments. He was also Executive vice-president of Retail Banking in Colombia and then Head of Retail Banking of the Americas Division in Madrid. Mr. Orellana holds a degree in Civil Engineering from Universidad de Chile and a CFI from Stanford.

 

Andrés Trautmann became the Executive Vice-President of Santander Corporate and Investment Banking in May 2021. He joined Grupo Santander in 2007, serving as Treasurer of Santander Chile between 2018 and 2021. Between 2013 and 2018 he was in charge of sales for the Andean region for Goldman Sachs in New York, and prior to that he was Head of Institutional and Corporate Sales at Santander Chile. He was also in charge of sales of structured products in London for Santander UK between 2010 and 2012. Between 2002 and 2006, he worked at Econsult as investment manager for investment funds and financial analyst for studies, and previously he was a financial analyst in the planning and development department of Enersis S.A. Mr. Trautmann is a Commercial Engineer from Universidad de Chile.

 

Luis Araya became the Executive Vice-President of our Middle-market banking segment in May 2021. Prior to that, he held various responsibilities in different divisions throughout the 25 years he has worked in the Bank. Before becoming manager of this segment, he was manager of the Santander branch network for four years and Manager of Human Resources for the Individuals Division for two years. Before that, he was part of the Commercial Division as Manager of Products, Investments and the Individuals segment. He also worked for Santander Corporate and Investment Banking for nine years. Luis Araya holds a degree in Civil Engineering and has a Master of Science in Engineering, both from Pontificia Universidad Católica de Chile.

 

Emiliano Muratore became the Chief Financial Officer for Santander-Chile in April 2016. From Buenos Aires, Argentina, he has more than 23 years of experience in the Santander Group. He joined Santander Rio (Argentina) in 1999 and after four years he was moved to the Group headquarters in Madrid as part of a young talent development program, where he started his experience in the finance division. In 2006, he moved to Santander Chile where, in 2008, he was appointed as Manager of the Financial Division, bearing responsibility for the management of structural financial risks. After eight years, he was promoted to Chief Financial Officer. Mr. Muratore has a degree in business from Universidad Católica Argentina in Buenos Aires and a postgraduate degree in finance from Universidad de San Andrés in Buenos Aires. In 2018 he completed the Advanced Management Program at Harvard Business School. Currently, he is chairman of the financial management and infrastructure committee at Chile’s Banking Association (ABIF). He also serves as board member at Fundación Belén Educa, a non-for-profit organization that manages 12 schools targeted to disadvantaged families.

 

117

 

 

Guillermo Sabater is the Financial and Cost Controller of Santander-Chile and has been working for Santander Group and its affiliates for 28 years. Between 2009 and 2015, he was Senior Executive Vice President of Santander in the U.S. and CFO and Controller of Sovereign Bank and Santander Holdings USA. Before that, he was the financial controller of Banco Santander Chile between 2006 and 2009. He also served for three years, between 2003 and 2006, as Financial Controller of the Consumer Finance Division in Madrid, Spain. Mr. Sabater also served as an internal auditor during his first ten years at the company. He has a degree in Economics and Business Administration from University College of Financial Studies at Universidad Complutense de Madrid and completed a Program in Executive Development at the Institute of Business and has completed various courses at institutions such as Babson College and Boston University.

 

Oscar Gómez is the Executive Vice-President of Risks, a position he has held since September 2023. Previously, he was Director of Internal Audit, a position he held from January 2020 to September 2023. He has worked for Grupo Santander since 1997 in different positions in the Internal Audit Division, including serving as the Corporate Director for Financial Risk Information. Mr. Gómez has a degree in Economic and Business Science from Universidad de Cantabria and is certified by the IIA (Institute of Internal Auditors) as CIA (Certified Internal Auditor) and CRMA (Certification in Risk Management Assurance). He has also completed post graduate studies at Instituto de Empresa (Spain) and INSEAD.

 

Ricardo Bartel became the Executive Vice-President of Technology and Operations in June 2015 after joining Santander Chile in October 2014 as Manager of Operational Services of the same division. Previously, he held various management positions in product and service companies such as Chief Financial Officer at Madeco, Logistics and Distribution Manager and Chief Financial Officer of CCU SA. and Chief Executive Officer of Empresas Relsa S.A. and Laboratorio Maver. Mr. Bartel has both a Civil Engineering degree and a Master of Business Administration from Universidad Católica de Chile. He is also a graduate of the Directive Management of Companies Program (PADE) of ESE Business School of Universidad de los Andes.

 

Paula Meléndez became the Executive Vice-President of Human Resources in June 2023. She has extensive experience in the financial sector, both in financial operational areas and in human resources. She has been part of Grupo Santander since 2004 leading, among others, the People and Culture Management, Organizational Development, Change Management and Financial Operations Control teams. She is an auditor/accountant and engineer in Information and Management Control from the University of Chile and has a Master’s degree in Financial Management from the Adolfo Ibáñez University.

 

Sergio Avila is the Exectuive Vice-President of Administration and Global Payments. He has been part of Grupo Santander since 1996, having led the teams of Investment Funds, Structured Financing, Personal Banking, Personal Products, Company Products and Retail Risks, Costs and Suppliers. Mr. Avila has a Civil Engineering degree with specialization in Electricity and a Master of Science in Civil Engineering from Universidad Católica de Chile.

 

Claudia Heimpell became Executive Vice-President of Client Experience and Service Quality of Santander Chile in November 2022. She has held various positions within the organization, including Select and High Income Segment Manager, Medium and Massive Income Manager, Commercial Assistant Manager in the Mortgage Area, and Marketing and Complementary Channels Manager at Banefe. Between 2018 and 2022 she was at Scotiabank, where she was responsible for the Retail, Data Analytics and VP of Distribution segments. Ms. Heimpell has a degree in Business from Finis Terrae University, an AMP from Universidad de los Andes and IESE Business School-Universidad de Navarra and holds a Diploma in Strategic Leadership from the Pontificia Universidad Católica de Chile.

 

Cristian Florence is our General Counsel, a position he has held since September 2012. Prior to that he served as Chief Lawyer at Santander-Chile. Mr. Florence joined Santander-Chile in 2002 when Santander-Chile merged with Banco Santiago. He started working in the banking industry in 1991, when he joined Centrobanco, a predecessor of Banco O’Higgins and Banco Santiago serving at several positions in the law departments. Mr. Florence is also a Director of Zurich Santander Seguros Generales Chile S.A., Zurich Santander Seguros de Vida Chile S.A. and Santander Asset Management S.A. Administradora General de Fondos. He has a degree in Law from Universidad Gabriela Mistral and a Master of Laws (LLM) from the same university and is a professor of Civil Law.

 

118

 

 

Mey Lin Hernandez is our Internal Auditor, a position she has held since September 2023. She has been working in internal auditing in Grupo Santander since Ocotber 2003. In March 2020 she joined Banco Santander Chile as head internal auditor for Market Risk. Ms. Hernández has a Business Degree from the Universidad Complutense de Madrid and is certified by COSO.

 

Jorge Valencia became the Director of Wealth Management and Insurance (WM&I) of Banco Santander in November 2021. He joined the group in 2016 at SCIB as head of Global Markets and later he was in charge of Banking and Corporate Finance. During his more than 25-year career, he has held various positions of responsibility at JPMorgan, Platinum Grove Asset Management, RBS and AFP Habitat. Mr. Valencia is an Economist from the Pontificia Universidad Católica de Chile and a Master of Arts in Corporate Communications from Universidad Adolfo Ibáñez.

 

Fernando Larraín became Executive Vice-President of Communications, Marketing and Research in June 2023. During his career he has served as a government advisor in different ministries and countries and has been a consultant to multilateral organizations, a business advisor, an academic, and a manager at universities and trade associations. Between 2016 and 2020 he was general manager of the Association of Pension Fund Administrators. Subsequently, he served as a consultant to the World Bank, non-resident senior fellow of the Atlantic Council, Director of the International Center for Pension Administration and member of the board of various foundations. He is a business engineer with a major in economics from the Pontificia Universidad Católica de Chile and a Master's in Public Affairs from Princeton University.

 

Jonathan Covarrubias was named Chief Accounting Officer of Santander-Chile in May 2019. He has over 21 years of experience in the banking industry, having started at Santander Chile in 2001. Previously, he has held managerial positions related to the Consolidation and Reporting Departments, overseeing our Chilean, U.S. and Spanish GAAP reporting requirements. Mr. Covarrubias is a public accountant from Universidad de Santiago. He has a Master in Business Administration (MBA) from Pontificia Universidad Católica de Chile and a Masters in International Business Management from Universidad de Zaragoza. He is also certified by the Comité de Acreditación de Conocimientos en el Mercado de Valores (CAMV) in Chile.

 

Soledad Ramirez became the Senior Manager of Sustainable Finance and Climate Change in March 2023. She joined Santander Chile in August 2019 as head of Collaboration Revenue in the Corporate Banking division. She has focused much of her career on creating and executing corporate finance transactions, effective risk management, and portfolio performance. Between 2002 and 2018, she worked in Scotiabank Chile, holding multiple positions within corporate banking, before being transferred to Canada as director of the risk area, having adjudication roles for corporate banking and later designing policies for retail banking. She is a commercial engineer from the Pontificia Universidad Católica de Chile. She has more than 20 years of experience in the financial industry, related to roles within corporate and investment banking, credit risk management and strategy.

 

B. Compensation

 

For the year ended December 31, 2023, the aggregate amount of compensation paid by us to all of our directors, executive officers and management members was Ch$43,941 million (U.S.$50.3 million). For the year ended December 31, 2023, the aggregate amount of compensation paid by us to all of our directors was Ch$1,7711 million (U.S.$2.0 million), in monthly stipends.

 

At our annual shareholder meeting held on April 19, 2023, shareholders agreed to maintain the remunerations approved in the previous shareholders’ meeting in 2022. In addition, a monthly stipend per director of UF 250 (U.S.$10,518), UF 500 (U.S.$21,036) for the Chairman of the Board and UF 375 (U.S.$15,777) for the Vice-Chairman’s of the Board was set. This amount will be increased by UF 30 per month (U.S.$1,262) if a Board member is named to one or more committees of the Board. The additional amount will be UF 60 (U.S.$2,524) for the President of a committee and UF 15 (U.S.$631) for the Vice-President of one or more committees. In the case of the Integral Risk Committee, which holds sessions twice a month, the remuneration received by a regular board member is UF 15 (U.S.$631) per session with the President of this committee receiving 30 UF (U.S.$1,262) per session. Remuneration will be limited to two sessions per month, even if more sessions are held. Shareholders also approved the Audit Committee remuneration for its members. The remuneration received by a regular board member is UF 115 (U.S.$4,838) with the President of this committee receiving 230 UF (U.S.$9,676). This remuneration is in line with Chilean corporate governance law. In addition, we can pay certain directors professional service fees for the consulting services that they render to us in their fields of expertise. For the year ended December 31, 2023, we did not make any such payments to our directors.

 

119

 

 

Santander-Chile and its affiliates have designed variable-compensation plans for their employees, based on performance targets and objectives, the achievement of which are evaluated and paid on a quarterly and/or annual basis.

 

Share-based compensation (settled in cash)

 

In accordance with IFRS 2, equity instruments settled in cash are allocated to executives of the Bank and its Subsidiaries as a form of compensation for their services. The Bank measures the services received and the cash obligation at fair value at the end of each reporting period and on the settlement date, recognizing any change in fair value in the income statement for the period. For the years ended December 31, 2023, 2022 and 2021 share-based compensation amounted to Ch$2,119 million, Ch$(1,169) million and Ch$(315) million.

 

Pension Plans

 

The Bank has an additional benefit available to its principal executives, consisting of a pension plan. The purpose of the pension plan is to endow the executives with funds for a better supplementary pension upon their retirement. For this purpose, the Bank will match the voluntary contributions made by the beneficiaries for their future pensions with an equivalent contribution. The executives will be entitled to receive this benefit subject to the following terms:

 

  a. The general requisite to apply for this benefit is that the employee must be carrying out his/her duties when turning 60 years old.

 

  b. The Bank will create a pension fund, with life insurance, for each beneficiary in the plan. Periodic contributions into this fund are made by the manager and matched by the Bank.

 

  c. The Bank will be responsible for granting the benefits directly.

 

120

 

 

If the working relationship between the executive and the company ends, before she fulfills the abovementioned requirements, she will have no rights under this benefit plan. In the event of the executive’s death or total or partial disability, the executive or her family will be entitled to receive this benefit. The Bank will make contributions to this benefit plan on the basis of mixed collective insurance policies whose beneficiary is the Bank. The life insurance company with whom such policies are executed is not an entity linked or related to the Bank or any other Santander Group company. Plan Assets owned by the Bank at the end of 2022 totaled Ch$6,819 million, (Ch$7,200 million in 2021). The amount of the defined benefit plans has been quantified by the Bank, based on the following criteria:

 

Calculation method

 

We use the projected unit credit method, which considers each working year as generating an additional amount of rights over benefits and values each unit separately. It is calculated based primarily on fund contributions, as well as other factors such as the legal annual pension limit, seniority, age and yearly income for each unit valued individually.

 

Actuarial hypothesis assumptions

 

Actuarial assumptions with respect to demographic and financial variables are non-biased and mutually compatible with each other. The most significant actuarial hypotheses considered in the calculations were:

 

   Plans post-employment
2023
   Plans post-employment
2022
 
Mortality chart   RV-2014    RV-2014 
Termination of contract rates   5.0%   5.0%
Impairment chart    PDT 1985    PDT 1985 

  

Assets related to the pension fund contributed by the Bank into the Seguros Euroamerica insurance company with respect to defined benefit plans are presented as net of associated commitments. Activity for post-employment benefits is as follows:

 

   As of December 31, 
   2023   2022 
   (in millions of Ch$) 
Plan assets   5,260    6,819 
Commitments for defined-benefit plans:          
For active personnel   (5,027)   (6,277)
Incurred by inactive personnel         
Minus:          
Unrealized actuarial (gain) losses         
Balances at year end   233    542 

 

121

 

 

Year’s cash flow for post-employment benefits is as follows:

 

   For the years ended December 31, 
   2023   2022   2021 
   (in millions of Ch$) 
a) Fair value of plan assets            
Opening balance   6,819    7,127    8,224 
Expected yield of insurance contracts   539    211    640 
Employer contributions   1,269    337    995 
Benefits paid   (3,367)   (856)   (2,659)
Fair value of plan assets at year end   5,260    6,819    7,200 
b) Present value of obligations               
Opening balance   (6,277)   (6,633)   (7,551)
Service cost   1,250    356    873 
Present value of obligations at year end   (5,027)   (6,277)   (6,678)
Net balance at year end   233    542    522 

 

Plan expected profit:

   As of December 31,
   2023  2022  2021
Type of expected yield from the plan’s assets  UF + 2.50% annually  UF + 2.50% annual  UF + 2.50% annual
Type of yield expected from the reimbursement rights  UF + 2.50% annually  UF + 2.50% annual  UF + 2.50% annual

 

Plan associated expenses:

 

   For the years ended December 31, 
   2023   2022   2021 
   (in millions of Ch$) 
Current period service expenses   1,250    356    (873)
Expected yield from plan’s assets   539    211    (640)
Total   1,789    567    (1,513)

 

C. Board Practices

 

Audit Committee

 

The Audit Committee (Comité de Directores y Auditoría) is comprised of three independent members of the Board of Directors and the Committee Secretary is Juan Pedro Santa María. The Chief Executive Officer, General Counsel, General Auditor and other managers of the Bank can be invited to the meetings if necessary and are present when discussing specific matters. This Committee’s primary responsibility is to support the Board of Directors in the continuous improvement of our system of internal controls, which includes reviewing the work of both the independent registered public accounting firm and the Internal Audit Department. The committee is also responsible for analyzing observations made by regulatory entities of the Chilean financial system about us and for recommending measures to be taken by our management in response. The external auditors are recommended by this committee to our Board of Directors and appointed by our shareholders at the annual shareholders’ meeting.

 

This committee is also responsible for:

 

  Presenting to the Board of Directors a list of candidates for the selection of an external auditor to be proposed at the Annual Shareholders’ Meeting.

 

  Presenting to the Board of Directors a list of candidates for the selection of rating agencies.

 

  Overseeing and analyzing the results of the external audit and the internal reviews.

 

122

 

 

  Overseeing and coordinating the Bank’s operational risk policies.

 

  Analyzing the interim and year-end financial statements and reporting the results to the Board of Directors.

 

  Analyzing the external auditors’ reports and their content, procedures and scope.

 

  Obtaining information regarding the effectiveness and reliability of the internal control systems and procedures.

 

  Analyzing the information systems performance, and its sufficiency, reliability and use in connection with decision-making processes.

 

  Obtaining information regarding compliance with the company’s policies regarding the due observance of laws, regulations and internal rules to which the company is subject.

 

  Investigating suspicious and fraudulent activities (including conflicts).

 

  Analyzing the reports of the inspection visits, instructions and presentations of the FMC.

 

  Obtaining information, analyzing and verifying the company’s compliance with the annual audit program prepared by the internal audit department.

 

  Informing the Board of Directors of accounting changes and their effects.

 

The Board members of this committee are:

 

Board member  Position in
Committee
Orlando Poblete Iturrate  President
Felix de Vicente Mingo  Member
Rodrigo Vergara Montes  Member
Juan Pedro Santa María Pérez  Secretary

 

Integral Risk Committee

 

The Integral Risk Committee of the Board is responsible for reviewing and monitoring all risks that may affect us, allowing for integral risk management. This committee serves as the governing body through which the Board supervises risk in general. It also evaluates the reasonability of the systems for measurement and control of the following risks: Credit risk, Market risk, Operational risk, Cybersecurity, Solvency risk (BIS), Legal risks, Compliance risks and Reputational risks.

 

This Committee includes seven Board members. This committee also includes the Chief Executive Officer, the Director of Risk and other senior level executives from the risk and commercial side of our business. The Board members of this committee are:

 

Board member  Position in
Committee
Alfonso Gomez  President
María Olivia Recart  Member
Félix de Vicente  Member
Blanca Bustamante  Member
Juan Pedro Santa María Pérez  Member
Claudio Melandri  Member
Lucía Santa Cruz  Member

 

123

 

 

Asset and Liability Committee (ALCO)

 

The ALCO includes the Chairman and Vice-Chairman of the Board and three additional members of the Board, the Chief Executive Officer, the Chief Financial Officer, the Corporate Financial Controller, the Manager of the Financial Management Division, the Manager of Market Risk, the Manager of the Treasury Division, and other senior members of management. The ALCO meets monthly. All limits reviewed by the ALCO are measured and prepared by the Market Risk Department. The non-Board members of the ALCO meet weekly to review liquidity, funding, capital and market risk related matters. The members of this committee are the following:

 

Board member  Position in
Committee
Rodrigo Vergara Montes  President
Claudio Melandri  Member
María Olivia Recart  Member
Félix de Vicente  Member
Alfonso Gomez Morales  Member

 

The main functions of the ALCO are:

 

  Making the most important decisions, approving the risk appetite and limits regarding our exposure to inflation, interest rate risk, inflation risk, funding, capital and liquidity levels.

 

  Review of the evolution of the most relevant local and international markets and monetary policies.

 

  Analyzing the main economic and risk factors that directly impact the results of the trading portfolios.

 

  Establishing the Bank’s policies, procedures and limits with respect to its trading portfolio. The Bank’s Market Risk Department measures all risks and limits and reports these to the Market Committee.

 

  Reviewing the net foreign exchange exposure and limit.

 

  Reviewing the results of the Bank’s client treasury business.

 

The main limits set and monitored by the ALCO (and measured by the Market Risk Department) are the following:

 

Risk   Measure
Interest rates   Sensitivity Capital
    Sensitivity NIM
    Regulatory limit (30 Days)
    Regulatory limit (90 Days)
    Inflation GAP
     
Liquidity   Liquidity coverage ratio
    Net stable funding ratio
    Stress tests
    Structural liquidity limit
    Wholesale funding limits
    Deposit concentration
    Asset encumbrance
     
Capital   Leverage ratio
    Core capital ratio
    BIS ratio
    ROE – COE
    RORAC – COE
     
Foreign exposures   Intergroup exposure: Derivatives, deposits, loans
Foreign assets: Derivatives, Deposits, Loans

 

124

 

 

Management Appointment Committee

 

The Management Appointment Committee oversees the revision and application of policies and procedures of roles defined as “key positions” and also the review of other positions within the organization in general. The members of this committee are the following:

 

Board member  Position in
Committee
Blanca Bustamante  President
Claudio Melandri  Member
Rodrigo Vergara Montes  Member

 

Remuneration Committee

 

The Remuneration Committee reviews the documentation referring to the evaluation and remuneration of roles defined as “key positions” and other members of the organization in general. The members of this committee are the following:

 

Board member  Position in
Committee
Alfonso Gómez  President
Orlando Poblete  Member
Claudio Melandri  Member

 

125

 

 

D. Employees

 

As of December 31, 2023, on a consolidated basis, we had 9,229 employees: 8,660 of whom were bank employees, 521 of which were employees of our subsidiaries and 48 of which were employees of entities controlled by the Bank through other considerations. We have traditionally enjoyed good relations with our employees and their unions. Of the total headcount of us and our subsidiaries, 6,639 or 71.9% were unionized.

 

In December 2023, a new collective bargaining agreement was signed with the main unions ahead of schedule, which becomes effective as of September 1, 2024 and which expires on December 31, 2027. We generally apply the terms of our collective bargaining agreement to unionized and non-unionized employees. The following chart summarizes the number of employees employed by the bank.

 

Employees  As of
December 31,
2023
 
Executives   247 
Supervisors   1,025 
Professionals   5,715 
Administrative   2,242 
Total   9,229 

 

E. Share Ownership

 

No director or executive officer owns more than 1% of the shares of Santander-Chile as of December 31, 2022. Santander-Chile currently does not have any arrangements for involving employees in its capital and there is no systematic arrangement for grant of options or shares or securities of Santander-Chile to them. In accordance with IFRS 2, equity instruments settled in cash are allocated to executives of the Bank and its Subsidiaries as a form of compensation for their services. See “Item 6—Directors, Senior Management and Employees—Compensation” for more details.

 

F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation

 

Not applicable.

 

ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

 

A. Major Shareholders

 

Santander Spain controls Santander-Chile through its holdings in Teatinos Siglo XXI Inversiones S.A. and Santander Chile Holding S.A., which are controlled subsidiaries. Santander Spain has control over 67.18% of our shares and actual participation, excluding non-controlling shareholders that participate in Santander Chile Holding, S.A. of 67.13%.

 

Shareholder  Number of
Shares
   Percentage 
Santander Chile Holding S.A.   66,822,519,695    35.46%
Teatinos Siglo XXI Inversiones S.A.   59,770,481,573    31.72%

 

Santander Spain is in a position to elect of a majority of the members of Santander-Chile’s Board of Directors, to determine its dividend and other policies and to determine substantially all matters to be decided by a vote of shareholders. Santander Spain holds ordinary shares to which no special voting rights are attached. Each share represents one vote and there are no shareholders with different voting rights.

 

The number of outstanding shares of Santander-Chile (of which there is only one class, being ordinary shares) at December 31, 2023, was 188,446,126,794 shares, without par value. Santander-Chile’s shares are listed for trading on the Chilean Stock Exchange and on the NYSE in connection with the registration of ADRs. The market capitalization of Santander-Chile as of December 31, 2023 on the Chilean Stock Exchange was Ch$8,103,183 million and U.S.$9,182 million on the NYSE. As of December 31, 2023, Santander-Chile had 11,013 holders of its ordinary shares registered in Chile, including The Bank of New York Mellon as Depositary (the “Depositary”) of Santander-Chile’s ADS Program. Other than the information disclosed in this section, there are no arrangements to the knowledge of Santander-Chile that can result in a change of control of Santander-Chile. As of December 31, 2023, there were a total of 23 ADR holders on record. Since some of these ADRs are held by nominees, the number of record holders may not be representative of the number of beneficial holders.

 

B. Related Party Transactions

 

The Chilean Companies Law requires that our transactions with related parties be on a market basis, that is, on similar terms to those customarily prevailing in the market. We are required to compare the terms of any such transaction to those prevailing in the market at the date the transaction is to be entered into. Directors of companies that violate this provision are liable for losses resulting from such violations.

 

126

 

 

In addition, under the Chilean Companies Law, a company may not enter into a transaction with related parties unless (i) such transaction has received the prior approval of the company’s Board of Directors and (ii) the terms of such transaction are consistent with the terms of transactions of a similar type prevailing in the market. If it is not possible to make this decision, the board may appoint two independent evaluators. The evaluators’ final conclusions must be made available to shareholders and directors for a period of 20 business days, during which shareholders representing 5% or more of the issued voting shares may request the board to call a shareholders’ meeting to resolve the matter, with the agreement of two thirds of the issued voting shares required for approval. For purposes of this regulation, the law considers the amount of a proposed transaction to be material if (1) it exceeds 1% of the company’s net worth (provided that it also exceeds UF2,000) or (2) it exceeds UF20,000.

 

All resolutions approving such transactions must be reported to the company’s shareholders at the annual shareholders’ meeting. Violations of this provision may result in administrative or civil liability to the corporation, the shareholders and/or third parties who suffer losses as a result of such violation.

 

Loans granted to related parties

 

In addition to subsidiaries and associated entities, the Bank’s “related parties” include the “key personnel” of the Bank’s executive staff (members of the Bank’s Board of Directors and the Senior Managers of Santander-Chile and its subsidiaries, together with their close relatives), as well as the entities over which the key personnel could exert significant influence or control.

 

The Bank also considers the companies that are part of the Santander Group worldwide as related parties, given that all of them have a common parent, i.e., Santander Spain. The table below shows loans and accounts receivable and contingent loans with related parties. For more information, see “Note 34—Transactions with Related Parties” in our Audited Consolidated Financial Statements appearing elsewhere in this Annual Report.

 

127

 

 

   As of December 31, 
   2023   2022   2021 
   Group
entities
   Assoc-iates
entities
   Key
personnel
   Other   Group
entities
   Assoc-iates
entities
   Key
personnel
   Other   Group
entities
   Assoc-iates
entities
   Key
personnel
   Other 
   (in millions of Ch$)   (in millions of Ch$)   (in millions of Ch$) 
Loans and accounts receivable                                                
Commercial loans   750,419    49,284    3,272    978    680,624    118    3,185    280    592,992    192    2,611    219 
Mortgage loans           29,809                30,479                20,716     
Consumer loans           6,388                6,540                6,562     
Loans and accounts receivable   750,419    49,284    39,469    978    680,624    118    40,204    280    592,992    192    29,889    219 
Allowance for loan losses   (1,037)   (50)   (361)   (19)   (2,213)   (8)   (164)   (10)   (2,586)   (30)   (138)   (6)
Net loans   749,382    49,234    39,108    959    678,411    100    40,040    270    590,406    162    29,751    213 
Guarantees                                   2,039        25,545    117 
Contingent loans                                                            
Personal guarantees                                                
Letters of credit   1,960                19,162                13,848             
Guarantees   438            343    30,422                538             
Contingent loans   2,398            343    49,584                14,386             
Allowance for contingent loans   (4)           (5)   (41)               (32)            
Net contingent loans   2,394            338    49,543                14,354             

 

Loans (a) were made in the ordinary course of business, (b) were made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with unrelated persons, and (c) did not involve more than the normal collection risk.

 

Under the Chilean General Banking Law, Chilean banks are subject to certain lending limits, including the following:

 

  a bank may not extend to any person or legal entity (or group of related entities), directly or indirectly, unsecured loans in an amount that exceeds 5.0% of the bank’s regulatory capital, or secured loans in an amount that exceeds 25.0% of its regulatory capital. In the case of foreign export trade finance, this 5.0% ceiling is raised to: 10.0% for unsecured financing, 30.0% for secured financing. This ceiling is raised to 15.0% for loans granted to finance public works under the concessions system contemplated in the Decree with Force of Law 164 of 1991, of the Ministry of Public Works, provided that either the loan is secured on the concession, or the loan is granted as part of a loan syndication;

 

  a bank may not grant loans bearing more favorable terms than those generally offered by banks in the same community to any entity (or group of related entities) that is directly or indirectly related to its owners or management;

 

  a bank may not extend loans to another bank in an aggregate amount exceeding 30.0% of its regulatory capital;

 

  a bank may not directly or indirectly grant a loan, the purpose of which is to allow the borrower to acquire shares in the lending bank;

 

  a bank may not lend, directly or indirectly, to a Director or any other person who has the power to act on behalf of the bank, or to certain related parties; and

 

  a bank may not grant loans to individuals or legal entities involved in the ownership or management of the bank, whether directly or indirectly (including holders of 1.0% or more of its shares), on more favorable terms than those generally offered to non-related parties. Loans may not be extended to senior executives and to companies in which such individuals have a participation of 5.0% or more of the equity or net earnings in such companies. The aggregate amount of loans to related parties may not exceed a bank’s regulatory capital.

 

We are not aware of any loans to any related parties exceeding the above lending limits.

 

128

 

 

The table below shows all other assets and liabilities with related parties:

 

   As of December 31, 
   2023   2022   2021 
   Companies
of the
Group
   Associ-ated
companies
   Key
person-nel
   Other   Companies
of the
Group
   Assoc-iated
companies
   Key
personnel
   Other   Companies
of the
Group
   Assoc-iated
companies
   Key
person-nel
   Other 
   (in millions of Ch$) 
Assets                                                
Cash and deposits in banks   666,062                280,364                1,069,468             
Financial assets at FVTPL                                                      
Financial derivative contracts   967,020    267,679            1,190,683    386,494            1,164,660    298,997         
Other assets   686,950    550,400            676,850    287,053            1,042,852    437,227         
                                                             
Liabilities                                                            
Financial liabilities at FVTPL                                                            
Financial derivative contracts   1,255,740    370,314            1,695,284    326,149            2,083,795    224,247         
Financial liabilities at amortized cost                                                            
Deposits and other demand liabilities   54,033    1,272    3,833    502    73,193        4,398    833    16,190    2,486    4,760    1,003 
Time deposits and other time liabilities   145,649        9,894    1,589    10,376        9,442    1,102    900,830    1,677    3,066    948 
Obligations under repurchase agreements   129,321                64,547            18,135    57,771        181    5,807 
Interbank borrowing   33,693                224,798                640,860             
Issued debt instruments   1,081,123                1,001,310                584,244    592,468         
Other financial liabilities   257,915    435,093            267,130    325,070                         

 

129

 

 

Other transactions with related parties

 

During the years ended December 31, 2023, 2022 and 2021, the Bank had the following significant income (expenses) from services provided to (by) related parties:

 

   As of December 31, 
   2023   2022   2021 
   Companies of the Group   Associated companies   Key personnel   Other   Companies of the Group   Associated companies   Key personnel   Other   Companies of the Group   Associated companies   Key personnel   Other 
   (in millions of Ch$) 
Interest income and inflation-indexation adjustments   (45,542)   1,471    1,717    (41)   (44,196)   (13)   4,198    79    (24,428)   51    1,905    9 
Fee and commission income and expenses   176,603    87,987    250    24    157,236    86,581    261    15    134,404    25,445    202    11 
Net income (expense) from financial operations and net foreign exchange gain (loss)(1)   233,651                (690,780)   (47,993)   (217)   27    (751,605)   187,300         
Other operating income and expenses   964    (734)           1,311    (619)           552    (525)        
Key personnel compensation and expenses           (43,941)               (32,739)               (36,579)    
Administrative and other expenses   (95,561)   (1,120)           (78,435)   (82,771)           (66,895)   (54,953)        
Total   270,115    87,604    (41,974)   (17)   (654,864)   (44,815)   (28,497)   121    (707,972)   157,318    (34,472)   20 

 

(1) Primarily relates to derivative contracts used to financially cover exchange risk of assets and liabilities that cover positions of the Bank and its subsidiaries.

 

Only transactions with related parties equal to or greater than UF5,000 (U.S.$210,357) are included individually in the table above. Transactions with related parties between UF1,000 (U.S.$42,071) and up to UF5,000 are included in other transactions with related parties. All transactions were conducted at arm’s length.

 

C. Interests of Experts and Counsel

 

Not applicable.

 

ITEM 8. FINANCIAL INFORMATION

 

A. Consolidated Statements and Other Financial Information

 

Financial Information

 

See “Item 18. Financial Statements.

 

Legal Proceedings

 

We are subject to certain claims and are party to certain legal and arbitration proceedings in the normal course of our business, including claims for alleged operational errors. We do not believe that the liabilities related to such claims and proceedings are likely to have, in the aggregate, a material adverse effect on our consolidated financial condition or results of operations. There are no material proceedings in which any of our directors, any members of our senior management, or any of our affiliates is either a party adverse to us or our subsidiaries or has a material interest adverse to us or our subsidiaries.

 

130

 

 

Upon the recommendation of our legal advisors, we estimate that our aggregate liability if all legal proceedings were determined adversely to us could result in significant losses not estimated by us. As of the date of the Audited Consolidated Financial Statements, the Bank and its affiliates were subject to certain legal actions in the normal course of their business. As of December 31, 2023, the Bank has provisions for these legal actions of Ch$4,504 million (Ch$5,533 million as of December 31, 2022), which are included in “Provisions” in the Audited Consolidated Statements of Financial Position as provisions for contingencies.

 

Dividends and dividend policy

 

Dividends

 

Under the current General Banking Law, a Chilean bank may not distribute provisory dividends. Santander-Chile’s annual dividend is proposed by its Board of Directors and is approved by the shareholders at the annual ordinary shareholders’ meeting held the year following that in which the dividend is generated. For example, the 2022 dividend must be proposed and approved during the first four months of 2023. Following shareholder approval, the proposed dividend is declared and paid. Historically, the dividend for a particular year has been declared and paid no later than one month following the shareholders’ meeting. Dividends are paid to shareholders of record on the fifth day preceding the date set for payment of the dividend. The applicable record dates for the payment of dividends to holders of ADSs will, to the extent practicable, be the same.

 

Under the General Banking Law, a bank must distribute cash dividends in respect of any fiscal year in an amount equal to at least 30% of its net income for that year, if the dividend does not result in the infringement of minimum capital requirements. The balances of our distributable net income are generally retained for use in our business (including for the maintenance of any required legal reserves). Although our Board of Directors currently intends to pay regular annual dividends, the amount of dividend payments will depend upon, among other factors, our current level of earnings, capital and legal reserve requirements, as well as market conditions, and there can be no assurance as to the amount or timing of future dividends.

 

Dividends payable to holders of ADSs are net of foreign currency conversion expenses of The Bank of New York Mellon, as depositary (the “Depositary”) and will be subject to the Chilean withholding tax currently at the rate of 35% (subject to credits in certain cases as described in “Item 10. Additional Information—E. Taxation—Material Tax Consequences of Owning Shares of Our Common Stock or ADSs”).

 

Under the Foreign Investment Contract (as defined herein), the Depositary, on behalf of ADS holders, is granted access to the Formal Exchange Market to convert cash dividends from Chilean pesos to U.S. dollars and to pay such U.S. dollars to ADS holders outside Chile, net of taxes, and no separate registration by ADS holders is required. In the past, Chilean law required that holders of shares of Chilean companies who were not residents of Chile to register as foreign investors under one of the foreign investment regimes contemplated by Chilean law in order to have dividends, sale proceeds or other amounts with respect to their shares remitted outside Chile through the Formal Exchange Market. On April 19, 2001, the Central Bank deregulated the Exchange Market and eliminated the need to obtain approval from the Central Bank in order to remit dividends, but at the same time this eliminated the possibility of accessing the Formal Exchange Market. These changes do not affect the current Foreign Investment Contract, which was signed prior to April 19, 2001, which grants access to the Formal Exchange Market with prior approval of the Central Bank. See “Item 10. Additional Information—D. Exchange Controls.”

 

131

 

 

The following table presents dividends declared and paid by us in nominal terms in the past four years:

 

Year  Dividend
(Ch$ millions)(1)
   Dividend
(U.S.$ millions)(2)
   Per share
(Ch$/share)(3)
   Per ADS
(U.S.$/ADS)(4)%
   over
earnings(5)%
   over
earnings(6)
 
2020(7)   331,256    430.8    1.76    0.91    60    54 
2021   310,468    443.4    1.65    0.94    60    61 
2022   464,977    548.60    2.47    1.16    60    55 
2023   485,191    610.1    2.57    1.30    60    61 

  

(1) Millions of nominal pesos.

 

(2) Millions of U.S.$ using the observed exchange rate of the day the dividend was approved at the annual shareholders’ meeting.

 

(3) Calculated on the basis of 188,446 million shares.

 

(4) Dividend in U.S.$ million divided by the number of ADS, which was calculated on the basis of 400 shares per ADS.

 

(5) Calculated by dividing dividend paid in the year by net income attributable to the equity holders of the Bank for the previous year under Chilean Bank GAAP. This is the payment ratio determined by shareholders.

 

(6) Calculated by dividing dividend paid in the year by net income attributable to the equity holders of the Bank for the previous year under IFRS.

 

(7) In 2020, shareholders of the Bank approved the distribution of 30% of the 2019 net income attributable to shareholders under Chilean Bank GAAP on April 30, 2020. This amounted to Ch$165,627 million (U.S.$198.0 million using the observed exchange rate of the day the dividend was approved at the annual shareholders’ meeting) or Ch$0.88 per share (U.S.$ per ADR 0.49). In the Extraordinary Shareholders Meeting held on November 26, 2020, a further 30% of the 2019 earnings was approved.

 

B. Significant Changes

 

None.

 

ITEM 9. THE OFFER AND LISTING

 

A. Offer and Listing Details

 

Our common stock is listed and traded on the Santiago Stock Exchange (under the ticker “BSANTANDER”). Our ADSs are listed and traded on the NYSE (under the ticker “BSAC”).

 

B. Plan of Distribution

 

Not applicable

 

C. Markets

 

Shares of our common stock are traded on the Chilean Stock Exchange. Each ADS represents 400 shares of common stock. ADRs have been issued pursuant to the amended and restated deposit agreement dated as of August 4, 2015. As of December 31, 2023, 31,999,913 ADSs were outstanding equivalent to 12,799,964,871 shares of common stock or 6.79%% of the total number of issued shares of common stock.

 

D. Selling Shareholders

 

Not applicable.

 

E. Dilution

 

Not applicable.

 

132

 

 

F. Expenses of the Issue

 

Not applicable.

 

ITEM 10. ADDITIONAL INFORMATION

 

A. Share Capital

 

Not applicable.

 

B. Memorandum and Articles of Association

 

The legal predecessor of Santander-Chile was Banco Santiago (“Santiago”). Santiago was incorporated by public deed dated September 7, 1977 granted at the Notary Office of Alfredo Astaburuaga Gálvez. Santiago received its permission to incorporate and function as a bank by Resolution No. 118 of the FMC on October 27, 1977. The Bank’s by-laws were approved by Resolution No. 103 of the FMC on September 22, 1977. In January 1997, Santiago merged with Banco O’Higgins, with Santiago as the surviving entity. In 1999, Santiago became a controlled subsidiary of Santander Spain. On January 9, 2017 in an Extraordinary Shareholder Meeting, the shareholders’ approved an amendment of the Bank’s Articles of Incorporation.

 

Our official name is Banco Santander-Chile and Banco Santander and Santander can also be used (formerly Banco Santander Santiago and Santander Santiago could also be used, but these names were eliminated in the new Articles of Incorporation).

 

The Bank has a single series of capital stock, which amounts to Ch$891,302,881,691, divided into 188,446,126,794 registered shares with no par value. The capital stock is fully subscribed for, deposited, and paid up. Each share represents one vote and there are no special classes of shares with different rights. Our by-laws do not include any condition that is more significant than required by law to change the right of shareholders.

 

Shareholder rights in a Chilean bank that is also an open stock (public) corporation are governed by (1) the corporation’s estatutos, which effectively serve the purpose of both the articles or certificate of incorporation and the by-laws of a company incorporated in the United States, (2) the General Banking Law and (3) to the extent not inconsistent with the General Banking Law, by the provisions of Chilean Companies Law applicable to open stock corporations, except for certain provisions that are expressly excluded. Article 137 of the Chilean Companies Law provides that all provisions of the Chilean Companies Law take precedence over any contrary provision in a corporation’s estatutos. Both the Chilean Companies Law and our estatutos provide that legal actions by shareholders against us (or our officers or directors) to enforce their rights as shareholders or by one shareholder against another in their capacity as such are to be brought in Chile in arbitration proceedings.

 

The Chilean securities markets are principally regulated by the FMC under the Chilean Securities Market Law and the Chilean Companies Law. In the case of banks, compliance with these laws is supervised by the FMC. These two laws provide for disclosure requirements, restrictions on insider trading and price manipulation and protection of non-controlling investors. The Chilean Securities Market Law sets forth requirements relating to public offerings, stock exchanges and brokers, and outlines disclosure requirements for companies that issue publicly offered securities. The Chilean Companies Law sets forth the rules and requirements for establishing open stock corporations while eliminating government supervision of closed (closely-held) corporations. Open stock (public) corporations are those with 500 or more shareholders, or companies in which 100 or more shareholders own at least 10.0% of the subscribed capital (excluding those whose individual holdings exceed 10.0%), and all other companies that are registered in the Securities Registry of the FMC.

 

Santander-Chile is a bank providing a broad range of commercial and retail banking services, as well as a variety of financial services. Our objects and purposes can be found in Article 4 of our by-laws.

 

Board of Directors and Managers

 

Currently, the Board of Directors consists of nine directors and two alternates, elected by shareholder vote at Ordinary Shareholders’ Meetings. The directors may be either shareholders or non-shareholders of the Company. There is no age limit for directors. The directors may be shareholders or persons who are not members of the company.

 

133

 

 

The directors shall hold office for three years and may be indefinitely re-elected, and their terms of office shall be renewed in their entirety at the conclusion of each term of office. If the Ordinary Shareholders’ Meeting at which periodic elections of directors occur is not held at the stipulated time for any reason, the incumbency of those who have completed their terms shall be understood to be extended until their replacements are appointed, and the Board shall be obligated to summon a Shareholders’ Meeting to make said appointments within thirty days.

 

The directors shall be compensated for their service. The amount of their compensation shall be fixed annually at the Ordinary Shareholders’ Meeting. Such compensation shall be in addition to any salaries, fees, travel expenses, representation expenses, payments due as delegates of the Board, or other stipends in money, kind, or royalties of any class, whether assigned to particular directors at the Ordinary Shareholders’ Meeting or by Board approval, for specific functions or work above and beyond their obligations as directors which have been entrusted to them precisely at the Ordinary Shareholders’ Meeting or by the Board. A detailed and separate record of these special compensations must be made in the Annual Report, indicating the full name of each director who has received them.

 

Without prejudice to other legal disqualifications or conflicts of interest, the following persons cannot serve as directors: (a) a person who has been convicted or is on trial for crimes penalized with a principal or accessory penalty of temporary suspension or permanent disqualification to hold public positions or offices; (b) a debtor subject to a pending insolvency procedure for liquidation, (c) legislators; (d) directors or employees of any other financial institution; (e) employees of the Office of the President of Chile or employees or officials of the Treasury or of the Services, Fiscal or Semi-Fiscal Institutions, Autonomous Agencies, State-Owned Enterprises, and generally all the Public Services created by law, as well as those of companies, partnerships, or public or private entities to which the State or its companies, partnerships, or centralized or decentralized institutions have contributed the majority capital or a proportion equal thereto, or have a similar representation or participation, provided that the limitation prescribed in this letter (e) shall not apply to persons who hold teaching positions; and (f) Bank employees.

 

In the elections of directors, each shareholder shall have one vote per share held or represented, and may cast all such votes in favor a single candidate or distribute them as deemed convenient; those who receive the largest number of votes in an election shall be proclaimed as elected, until the number of persons to be elected is reached. Elections of principal and alternate directors must be held separately. To proceed to a vote, the Chairman and the Secretary, jointly with the persons who have previously been designated at the Ordinary Shareholders’ Meeting to sign the minutes thereof, must make a documentary record of the votes which are cast through voice vote by the shareholders present, according to the list of attendance. However, any shareholder shall be entitled to vote on a ballot signed by him, stating whether he signs on his own behalf or as a proxy. In any event, to facilitate the casting or speed of a vote, the Chairman of the Bank or the FMC, if applicable, may order an alternative procedure or permit either a voice vote or a ballot vote, or any other procedure stipulated as adequate for the purpose. In counting the results, the Chairman shall read out the votes cast aloud so that all the persons present can count the votes themselves and the truthfulness of the result can be verified. The Secretary shall add up the votes and the Chairman shall announce the candidates that receive the largest majorities and proclaim them thereby elected, until the number of persons to be elected is reached. The Secretary shall place the document reflecting the vote count, signed by the persons responsible for taking note of the votes cast, as well as the ballots delivered by the shareholders who did not vote by voice, in an envelope which shall be closed and sealed with the corporate seal, and shall be kept on file at the Bank for at least two years.

 

Every election to the Board, or every change to the composition of the Board, must be recorded in a public deed executed before a Notary, published in a Santiago newspaper, and reported to the FMC by sending an authorized copy of the respective public deed. The appointments of the General Manager and Assistant Deputy Manager must likewise be reported and converted into a public deed.

 

Vacancies that arise when a director ceases to be able to perform his or her duties, either because he becomes subject to any conflict of interest, limitation, or legal disqualification or because he is subject to a pending insolvency procedure for liquidation, or due to impossibility of serving, unjustified absence, death, resignation, or for another legal cause, shall be filled in the following manner: (a) vacancies of principal directors by alternate directors; and (b) in case of vacancies of alternate directors because of the application or circumstances not provided for in letter (a) above, or vacancies of principal directors which could not be filled as provided for in this letter because the alternate directors have become principal directors, the appropriate replacements shall be appointed at the first board of directors meeting to be held. The directors so designated shall remain in office until the next Ordinary Shareholders’ Meeting, at which the definitive appointments shall be made for the time remaining to complete the replaced directors’ terms.

 

134

 

 

The alternate directors may always take part in a Board meeting and have the right to speak at any such meeting. However, they shall have the right to vote only when they replace a principal director.

 

The Board shall separately elect a Chairman, a First Vice Chairman, and a Second Vice Chairman from among its members at the first meeting held after the Shareholders’ Meeting has appointed it or at its first meeting held after the persons in question have ceased to hold the position for any reason. In case of a tie vote, the person who chairs the meeting shall have the tie-breaking vote.

 

The Board shall appoint a General Manager who is responsible for the management of the Bank’s business and represents the Bank in all its offices. The General Manager has the right to participate in discussions at Board meetings but may not vote at such meetings. The Board shall also appoint one or more Managers who are responsible for the transactions and business of the Bank at the offices, branch offices, divisions and services placed under their management. The Directors, Managers and other employees of the Bank shall be personally responsible for non-compliance with the Bank’s by-laws and other legal or regulatory provisions arising from the performance of their duties, and liable for such infringements which are affected with their knowledge.

 

The Board meetings shall be held at the company’s domicile unless the directors unanimously resolve to hold a particular session at a different location, or all the directors participate in any such meeting held at a different location. The Board shall meet in ordinary session at least once a month, on the days and at the times the Board designates, and additionally, in extraordinary sessions from time to time when summoned by the Chairman at his or her own initiative or at the request of three or more directors, following the Chairman’s determination of the need for a meeting, unless it is requested by an absolute majority of the incumbent directors, in which case the meeting must necessarily be held without the need for a prior determination. Only the topics specifically stated in the notice of meeting may be addressed at extraordinary meetings, unless all the incumbent directors are present, and they unanimously agree otherwise. Summons to extraordinary meetings shall be made in accordance with and in the form prescribed by law.

 

The quorum for Board meetings shall be the absolute majority of the number of directors entitled to vote as prescribed in our by-laws. Resolutions shall be adopted by the absolute majority of the directors present who are entitled to vote. In case of a tie vote, the person who chairs the meeting shall have the tie-breaking vote. Directors who, though not present, are in simultaneous and permanent communication through technological means which have been authorized by the FMC shall be understood to participate in the meetings.

 

Directors who have an interest in a business dealing, legal act, contract, or operation or transaction not specifically of a banking nature, or as representatives of another person, must inform the other directors thereof. The respective resolutions shall be approved by the Board and must be in accordance with conditions of equity similar to those customarily prevailing in the market and they shall be disclosed at the next Ordinary Shareholders’ Meeting by the person who chairs such meeting.

 

A record of the Board’s deliberations and resolutions shall be made in a special minute book to be kept by the Secretary. The minutes must be consecutively numbered, with one numbering sequence assigned to ordinary meetings and another to extraordinary meetings, and they must be signed by the directors who took part in the meeting and the Secretary or the person who performs his or her functions. A director who believes certain minutes contain inaccuracies or omissions is entitled to record his or her reservations prior to signing them. Resolutions may be carried out without the need to approve the minutes at a subsequent meeting. If any of the persons present dies, refuses to sign the minutes, or is prevented from doing so for any reason, a record of said impediment shall be made at the foot thereof.

 

The directors shall be personally responsible or liable for all the legal acts they execute in the performance of their functions. A director who wishes to avoid responsibility or liability for any legal act or resolution of the Board must make a record of his or her opposition in the minutes and the Chairman shall be informed thereof at the next Ordinary Shareholders’ Meeting.

 

The Board shall represent the Bank judicially and extra-judicially and for the pursuit of its corporate purpose, which need not be demonstrated to third parties in any manner; it shall be vested with all the authorities and powers of administration that the law or the by-laws do not define as pertaining exclusively to Shareholders’ Meetings, without the need to confer any special power of attorney whatsoever, even for legal acts or contracts for which the laws so require. The foregoing does not impair the Bank’s judicial representation by the General Manager. The Board may delegate part of its powers to the General Manager, to one or more managers, assistant managers, or attorneys of the Bank, to a director, or to a committee of Directors, as well as to other persons for specific purposes.

 

135

 

 

The Board shall designate three Directors from among its members to serve on a Comité de Directores (Audit Committee) which shall be governed by the provisions of Article 50bis of the Chilean Companies Law.

 

The Chairman/President

 

The Chairman of the Board shall likewise be the president of the company and the chairman of the Shareholders’ Meetings. He shall have the following obligations and authorities, in addition to those prescribed in the pertinent legal and regulatory provisions, in our by-laws, or by the Board: (a) chair the Board and Shareholders’ Meetings; (b) enforce strict compliance with the by-laws, the Board’s resolutions, and the resolutions of the Shareholders’ Meetings; (c) summon the Board meetings; and (d) sign the annual reports and the resolutions and communications of the Board and the Shareholders’ Meetings. In the absence or temporary impediment of the Chairman/President, the First Vice Chairman/First Vice President shall act in his or her stead, and in the latter’s absence, the Second Vice Chairman/Second Vice President shall act, or finally, the person designated by the Board from among its members or the shareholder designated at the Shareholders’ Meeting, as the case may be. Replacement is an internal company procedure that shall not require any formality, and it shall not be necessary to demonstrate its validity to third parties in order to assure the validity of the replacement’s actions; the sole fact of its occurrence suffices to make said actions effective.

 

Meetings and Voting Rights

 

The shareholders shall meet in Ordinary or Extraordinary Shareholders’ Meetings held in Santiago. The resolutions adopted at a validly summoned and convened Shareholders’ Meeting, in conformity with the by-laws, shall be binding on all of the shareholders.

 

The Ordinary Shareholders’ Meetings shall be held annually on the dates determined by the Board within the first four months following the date of the annual balance sheet. There shall be an Extraordinary Shareholders’ Meeting whenever the company’s needs so require. The meetings shall be summoned by the Board at its own initiative or at the request of shareholders representing at least 10% of the issued shares having a legal right to vote. If in this circumstance, the Board, and through it the Chairman, refuses to issue a summons, the FMC may be requested to do so.

 

The summons to a Shareholders’ Meeting shall be given through a prominent notice to be published three times on different days in the Santiago newspaper which has been chosen at the Ordinary Shareholders’ Meeting, and in the absence of agreement or in the event of a suspension or disappearance of the designated newspaper’s circulation, in the Official Journal, at the time, in the form, and under the conditions stipulated by the Regulations of the Chilean Companies Law. Summonses to Extraordinary Shareholders’ Meetings shall state the topics which will be submitted to them. The summons to a meeting shall likewise be announced through a letter sent to the shareholders a minimum of fifteen days in advance of the date set for the meeting, which must contain a reference to the topics to be addressed at it. Failure to send said letter shall not invalidate the summons, without prejudice to legal liabilities. On a date no later than that of the first notice of a summons for an Ordinary Shareholders’ Meeting, each shareholder must be sent a copy of the Bank’s Annual Report and Balance Sheet, including the auditors’ opinion and its respective notes.

 

Quorum for Shareholders’ Meetings shall be established by the presence of as many shareholders as represent, directly or by proxy, at least an absolute majority of the issued voting shares. If said quorum is not satisfied, a new summons shall be given, for a meeting which must be scheduled to be held in the manner prescribed in Article 37 of our by-laws, indicating that it is a second summons and scheduling the new meeting to be held within the forty five days subsequent to the date scheduled for the meeting that was not held due to a lack of quorum. A meeting called by a second summons shall lawfully convene with the number of issued voting shares present or represented thereat.

 

In the absence of a special rule, a Shareholders’ Meeting resolution shall be adopted by an absolute majority of the voting shares present or represented.

 

The Ordinary Shareholders’ Meetings have the following responsibilities: (a) deliberate and resolve on the Annual Report and Balance Sheet which must be submitted by the Board; (b) annually designate an external auditing firm in conformity with the provisions of law to report on the balance sheet and comply with the legal requirements; (c) elect the members of the Board when appropriate pursuant to our by-laws; (d) resolve the distribution of the liquid profits or earnings for each fiscal year, and at the Board’s request, order the distribution of a dividend to the shareholders as of the end of each fiscal year, as prescribed in the by-laws; and (e) in general, deliberate and pass resolutions on any other topic of corporate interest which is not reserved to an Extraordinary Shareholders’ Meeting. The revocation of all the Board members elected by the shareholders and the designation of their replacements may be resolved at an Ordinary or Extraordinary Shareholders’ Meeting, but any individual or collective revocation of one or more Board members would accordingly be invalid.

 

136

 

 

The Extraordinary Shareholders’ Meetings are reserved for certain topics indicated by law or by our by-laws. Resolutions on the topics indicated in the notice of meeting may be adopted at Extraordinary Shareholders’ Meetings.

 

The shareholders may have themselves represented at Meetings by another person, whether a shareholder or not, as is stipulated in the Chilean Companies Law.

 

A record of the deliberations and resolutions at any Shareholders’ Meeting shall be made in a special minute book to be kept by the Secretary, if any, or in his or her absence by the Bank’s General Manager. The minutes shall be signed by the Chairman or the person who performs his or her functions, by the Secretary and three shareholders elected by the Meeting, or by all the persons present if they number fewer than three. In the event of death, refusal, or impediment to signing the minutes on the part of any of the persons who must do so, a record of the impediment shall be made at the foot thereof. An extract of the minutes shall be made to record what happened at the meeting, and an official copy of the following data shall necessarily be made: the names of the shareholders present and the number of shares owned or represented by each of them (a brief summary of any objections may be omitted if it is attached to the same page or roll of attendance), a list of the proposals submitted for discussion and the results of the votes taken, and the list of the shareholders who voted for or against. Solely by the unanimous consent of the persons present may a record of any event occurring at the meeting that is related to the company’s interests be deleted from the minutes.

 

The persons present at any Shareholders’ Meetings shall sign a roll of attendance on which they shall indicate the number of shares the signatory holds, the number of shares he represents, and the name of the shareholder he represents.

 

In general, Chilean law does not require a Chilean open stock corporation to provide the level and type of information that U.S. securities laws require a reporting company to provide to its shareholders in connection with a solicitation of proxies. However, shareholders are entitled to examine the books of the bank within the 15-day period before the ordinary annual meeting. In addition to these requirements, we regularly provide, and management currently intends to continue to provide, together with the notice of shareholders’ meeting, a proposal for the final annual dividend.

 

Annual Report, Balance Sheet, and Distribution of Profits

 

A Balance Sheet shall be drawn up as of the thirty-first day of December of each year, to be submitted to the Ordinary Shareholders’ Meeting for its consideration, jointly with the Annual Report. The Balance Sheet and Statement of Income shall be published in conformity with the currently applicable legal and regulatory provisions. The approval or rejection of such financial statements is entirely within our shareholders’ discretion. If our shareholders reject our financial statements, our Board of Directors must submit new financial statements not later than 60 days from the date of such rejection. If our shareholders reject our new financial statements, our entire Board of Directors is deemed removed from office and a new Board of Directors is elected at the same meeting. Directors who individually approved such rejected financial statements are disqualified for re-election for the ensuing period.

 

The profits attributable to shareholders reflected in the Balance Sheet shall be applied preferentially to absorb prior-year losses. The balance which is earned shall be allocated as may be resolved by the Shareholders’ Meeting, at the Board’s recommendation, to: (a) an increase of the effective capital, the formation of a fund for future capitalizations or dividends, or other special reserve funds; these uses shall receive the amounts the Meeting deems convenient, in conformity with the limits and obligations prescribed by law; and (b) the distribution of dividends to the shareholders in proportion to their shareholdings.

 

Under the Chilean Corporations Law, Chilean companies are generally required to distribute at least 30.0% of their earnings as dividends. No dividends of a bank above the legal minimum can be distributed if doing so would result in the bank infringing its ratio of regulatory capital to risk-weighted assets and shareholders’ equity to total assets.

 

137

 

 

Dividends that are declared but not paid by the date set for payment at the time of declaration are adjusted from the date set for payment to the date such dividends are actually paid, and they accrue interest.

 

We may declare a dividend in cash or in shares. When a share dividend is declared above the legal minimum (which minimum must be paid in cash), our shareholders must be given the option to elect to receive cash. Our ADS holders may, in the absence of an effective registration statement under the Securities Act or an available exemption from the registration requirement thereunder, effectively be required to receive a dividend in cash. See “Item 10.B.—Memorandum and Articles of Association—Preemptive Rights and Increases of Share Capital.” A dividend entitlement lapses after 5 years and the funds go to the Chilean Treasury.

 

Liquidation and Appraisal Rights

 

The Bank may be dissolved and liquidated if it is so resolved at an Extraordinary Shareholders’ Meeting, with the favorable vote of at least two thirds of the issued voting shares, and approved by the Superintendent of Banks and Financial Institutions.

 

Once the voluntary dissolution to which the preceding article refers has been resolved, the Shareholders’ Meeting at which it is resolved shall appoint a committee of three shareholders to proceed to the company’s liquidation. The liquidating committee so created shall act with the powers and obligations which the by-laws confer on the Board, and it shall keep the shareholders informed of the liquidation’s progress, shall summon Ordinary Shareholders’ Meetings on the dates scheduled for them, being authorized to likewise summon Extraordinary Shareholders’ Meetings. In all other respects the provisions of the Commercial Code, the applicable provisions of the Chilean Companies Law, and the corporate regulations which govern the company shall be followed. In accordance with the General Banking Law, our shareholders do not have appraisal rights.

 

Arbitration

 

Any difficulty which may arise between the Bank and any of the shareholders or directors, or between such persons, in connection with the application of the by-laws or the recognition of the existence, nonexistence, validity, nullity, construction, performance or breach, dissolution, liquidation, or any other cause shall be submitted to resolution by two arbitrators at law and in equity, who shall rule without subsequent appeal, one of whom shall be appointed by each party. If they cannot reach agreement, the parties shall appoint a third arbitrator to resolve the discord. If there is no agreement for the third arbitrator’s appointment, the two previously appointed arbitrators shall make the designation. If either party refuses to participate in the appointment of arbitrators or, after they have been appointed, there is no agreement on the ruling and neither the parties nor the arbitrators have designated the third arbitrator to resolve the discord, the designation of said arbitrator, if any, or of the third participant in discord, shall be made by the Ordinary Court of Justice, and the person so designated must necessarily be one who has held or currently holds the position of attorney and member of the Honorable Supreme Court.

 

Capitalization

 

Under Chilean law, the shareholders of a company, acting at an extraordinary shareholders’ meeting, have the power to authorize an increase in such company’s capital. When an investor subscribes for issued shares, the shares are registered in such investor’s name, even if not paid for, and the investor is treated as a shareholder for all purposes except with regard to receipt of dividends and the return of capital, provided that the shareholders may, by amending the by-laws, also grant the right to receive dividends or distributions of capital. The investor becomes eligible to receive dividends and returns of capital once it has paid for the shares (if it has paid for only a portion of such shares, it is entitled to reserve a corresponding pro-rata portion of the dividends declared and/or returns of capital with respect to such shares unless the company’s by-laws provide otherwise). If an investor does not pay for shares for which it has subscribed on or prior to the date agreed upon for payment, the company is entitled under Chilean law to auction the shares on the stock exchange and collect the difference, if any, between the subscription price and the auction proceeds. However, until such shares are sold at auction, the subscriber continues to exercise all the rights of a shareholder (except the right to receive dividends and return of capital).

 

Article 22 of the Chilean Corporations Law states that the purchaser of shares of a company implicitly accepts its by-laws and any agreements adopted at shareholders’ meetings.

 

138

 

 

Registrations and Transfers

 

We act as our own registrar and transfer agent, as is customary among Chilean companies. In the case of jointly owned shares, an attorney-in-fact must be appointed to represent the joint owners in dealings with us.

 

Ownership Restrictions

 

Under Article 12 of the Chilean Securities Market Law and the regulations of the FMC, shareholders of open stock corporations are required to report the following to the FMC and the Chilean stock exchanges:

 

any direct or indirect acquisition or sale of shares that results in the holder’s acquiring or disposing, directly or indirectly, 10.0% or more of an open stock corporation’s share capital; and

 

any direct or indirect acquisition or sale of shares or options to buy or sell shares, in any amount, if made by a holder of 10.0% or more of an open stock corporation’s capital or if made by a director, liquidator, main officer, general manager or manager of such corporation.

 

In addition, majority shareholders must include in their report whether their purpose is to acquire control of the company or if they are making a financial investment. A beneficial owner of ADSs representing 10.0% or more of our share capital will be subject to these reporting requirements under Chilean law.

 

Under Article 54 of the Chilean Securities Market Law and the regulations of the FMC, persons or entities intending to acquire control, directly or indirectly, of an open stock corporation, regardless of the acquisition vehicle or procedure, and including acquisitions made through direct subscriptions or private transactions, are also required to inform the public of such acquisition at least 10 business days before the date on which the transaction is to be completed, but in any case, as soon as negotiations regarding the change of control begin (i.e., when information and documents concerning the target are delivered to the potential acquirer) through a filing with the FMC, the stock exchanges and the companies controlled by and that control the target and through a notice published in two Chilean newspapers, which notice must disclose, among other information, the person or entity purchasing or selling and the price and conditions of any negotiations.

 

Prior to such publication, a written communication to such effect must be sent to the target corporation, to the controlling corporation, to the corporations controlled by the target corporation, to the FMC, and to the Chilean stock exchanges on which the securities are listed.

 

In addition to the foregoing, Article 54A of the Chilean Securities Market Law requires that within two business days of the completion of the transactions pursuant to which a person has acquired control of a publicly traded company, a notice shall be published in the same newspapers in which the notice referred to above was published and notices shall be sent to the same persons mentioned in the preceding paragraphs.

 

The provisions of the aforementioned articles do not apply whenever the acquisition is being made through a tender or exchange offer.

 

Title XXV of the Chilean Securities Market Law on tender offers and the regulations of the FMC provide that the following transactions must be carried out through a tender offer:

 

an offer which allows a person to take control of a publicly traded company, unless (i) the shares are being sold by a controlling shareholder of such company at a price in cash which is not substantially higher than the market price and the shares of such company are actively traded on a stock exchange and (ii) those shares are acquired (a) through a capital increase, (b) as a consequence of a merger, (c) by inheritance or (d) through a forced sale; and

 

an offer for a controlling percentage of the shares of a listed company if such person intends to take control of the parent company (whether listed or not) of such listed company, to the extent that the listed company represents 75.0% or more of the consolidated net worth of the parent company.

 

In addition, Article 199 of the Chilean Securities Market Law requires that whenever a controlling shareholder acquires two thirds of the voting shares of a listed company, such controlling shareholder must offer to purchase the remaining shares from the non-controlling shareholders in a tender offer.

 

139

 

 

Article 200 of the Chilean Securities Market Law prohibits any shareholder that has taken control of a publicly traded company to acquire, for a period of 12 months from the date of the transaction in which it gained control of the publicly traded company, a number of shares equal to or greater than 3.0% of the outstanding issued shares of the target without making a tender offer at a price per share not lower than the price paid at the time of taking control. Should the acquisition from the other shareholders of the company be made on a stock exchange and on a pro rata basis, the controlling shareholder may purchase a higher percentage of shares, if so permitted by the regulations of the stock exchange.

 

Title XV of the Chilean Securities Market Law sets forth the basis to determine what constitutes a controlling power, a direct holding and a related party. The Chilean Securities Market Law defines control as the power of a person or group of persons acting (either directly or through other entities or persons) pursuant to a joint action agreement, to direct the majority of the votes at the shareholders’ meetings of the corporation, to elect the majority of members of its Board of Directors, or to influence the management of the corporation significantly. Significant influence is deemed to exist in respect of the person or group of persons with an agreement to act jointly that holds, directly or indirectly, at least 25.0% of the voting share capital, unless:

 

another person or group of persons acting pursuant to joint action agreement, directly or indirectly, controls a stake equal to or greater than the percentage controlled by such person or group of persons;

 

the person or group does not control, directly or indirectly, more than 40.0% of the voting share capital and the percentage controlled is lower than the sum of the shares held by other shareholders holding more than 5.0% of the share capital (either directly or pursuant to a joint action agreement); or

 

in cases where the Superintendency of Securities and Insurance (now the FMC) has ruled otherwise, based on the distribution or atomization of the overall shareholding.

 

According to the Chilean Securities Market Law, a joint action agreement is an agreement among two or more parties which, directly or indirectly, own shares in a corporation at the same time and whereby they agree to participate with the same interest in the management of the corporation or in taking control of the same. The law presumes that such an agreement exists between:

 

a principal and its agents;

 

spouses and relatives within certain degrees of kinship;

 

entities within the same business group; and

 

an entity and its controller or any of the members of the controller.

 

Likewise, the FMC may determine that a joint action agreement exists between two or more entities considering, among other things, the number of companies in which they participate and the frequency with which they vote identically in the election of directors, appointment of managers and other resolutions passed at extraordinary shareholders’ meetings.

 

According to Article 96 of the Chilean Securities Market Law, a business group is a group of entities with such ties in their ownership, management or credit liabilities that it may be assumed that the economic and financial action of such members is directed by, or subordinated to, the joint interests of the group, or that there are common credit risks in the credits granted to, or in the acquisition of securities issued by, them. According to the Chilean Securities Market Law, the following entities are part of the same business group:

 

a company and its controller;

 

all the companies with a common controller together with that controller;

 

all the entities that the FMC declares to be part of the business group due to one or more of the following reasons:

 

a substantial part of the assets of the company is involved in the business group, whether as investments in securities, equity rights, loans or guaranties;

 

140

 

 

the company has a significant level of indebtedness and the business group has a material participation as a lender or guarantor;

 

any member of a group of controlling entities of a company mentioned in the first two bullets above and there are grounds to include it in the business group; or

 

the company is controlled by a member of a group of controlling entities and there are grounds to include it in the business group.

 

Article 36 of the General Banking Law states that as a matter of public policy, no person or company may acquire, directly or indirectly, more than 10.0% of the shares of a bank without the prior authorization of the FMC, which may not be unreasonably withheld. The prohibition would also apply to beneficial owners of ADSs. In the absence of such authorization, any person or group of persons acting in concert would not be permitted to exercise voting rights with respect to the shares or ADSs acquired. In determining whether or not to issue such an authorization, the FMC considers a number of factors enumerated in Article 28 of the General Banking Law, including, among others (i) the financial stability of the purchasing party and (ii) the legitimacy of the purchasing party.

 

According to Article 35bis of the General Banking Law, the prior authorization of the FMC is required for:

 

the merger of two or more banks;

 

the acquisition of all or a substantial portion of a banks’ assets and liabilities by another bank;

 

the control by the same person, or controlling group, of two or more banks; or

 

a substantial increase in the existing control of a bank by a controlling shareholder of that bank.

 

The FMC may deny its authorization with an accompanying resolution recording the specific reasons for denying the authorization and with the agreement of a majority of the Board of Directors of the Central Bank, provided there is notice of such agreement within 10 banking business days (which may be extended under Law 18,840).

 

According to the General Banking Law, a bank may not grant loans to related parties on terms more favorable than those generally offered to non-related parties. Article 84 No. 2 of the General Banking Law provides that the FMC will determine, by means of a general rule, who must be considered a related party of the bank. In addition, the FMC will establish rules to determine if certain persons constitute a group of related parties in one or more of the following circumstances: (i) business or administrative relationships that allow a person to exercise relevant and permanent influence over another’s decisions; (ii) an assumption will be made that the loans granted to one person will be used in benefit of the other; and (iii) an assumption will be made that diverse persons maintain relationships that create a unit of economic interests. Finally, according to the regulations of the FMC, Chilean banks that issue ADSs are required to inform the FMC if any person, directly or indirectly, acquires ADSs representing 5.0% or more of the total amount of shares of capital stock issued by such bank.

 

Article 16bis of the General Banking Law provides that the individuals or legal entities that, individually or with other people, directly control a bank and who individually own more than 10.0% of its shares must send to the FMC reliable information on their financial situation with the content and in the opportunity set forth in a general rule issued by the FMC, which will not exceed the information required for open-stock corporations (sociedad anónima abierta).

 

There are no limitations for non-resident or foreign shareholders to hold or exercise voting rights on the securities.

 

Preemptive Rights and Increases of Share Capital

 

The Chilean Corporations Law provides that whenever a Chilean company issues new shares for cash, it must offer its existing shareholders the right to purchase a number of shares sufficient to maintain their existing ownership percentages in the company. According to our by-laws, options for subscription of capital increases must be offered on a preemptive basis to the shareholders, in proportion to the number of shares each shareholder owns, and the released shares which are issued shall be distributed in the same proportion.

 

141

 

 

Pursuant to this requirement, preemptive rights in connection with any future issue of shares will be offered by us to the Depositary as the registered owner of the shares underlying the ADRs. However, the Depositary will not be able to make such preemptive rights available to holders of ADSs unless a registration statement under the Securities Act is effective with respect to the underlying shares or an exemption from the registration requirements thereunder is available.

 

We intend to evaluate, at the time of any preemptive rights offering, the practicality under Chilean law and Central Bank regulations in effect at the time of making such rights available to our ADS holders, as well as the costs and potential liabilities associated with registration of such rights and the related shares of common stock under the Securities Act, and the indirect benefits to us of thereby enabling the exercise by all or certain holders of ADSs of their preemptive rights and any other factors we consider appropriate at the time, and then to make a decision as to whether to file such registration statement. We cannot assure you that any registration statement would be filed. If we do not file a registration statement and no exemption from the registration requirements under the Securities Act is available, the Depositary will sell such holders’ preemptive rights and distribute the proceeds thereof if a premium can be recognized over the cost of such sale. In the event that the Depositary is not able, or determines that it is not feasible, to sell such rights at a premium over the cost of any such sale, all or certain holders of ADSs may receive no value for such rights. Non-U.S. holders of ADSs may be able to exercise their preemptive rights regardless of whether a registration statement is filed. The inability of all or certain holders of ADSs to exercise preemptive rights in respect of shares of common stock underlying such ADSs could result in such holders not maintaining their percentage ownership of the common stock following such preemptive rights offering unless such holder made additional market purchases of ADSs or shares of common stock.

 

Under Chilean law, preemptive rights are exercisable or freely transferable by shareholders during a period that cannot be less than 30 days following the grant of such rights. During such period, and for an additional 30-day period thereafter, a Chilean corporation is not permitted to offer any unsubscribed shares for sale to third parties on terms which are more favorable than those offered to its shareholders. At the end of such additional 30-day period, a Chilean open stock corporation is authorized to sell unsubscribed shares to third parties on any terms, provided they are sold on a Chilean stock exchange. Unsubscribed shares that are not sold on a Chilean stock exchange can be sold to third parties only on terms no more favorable for the purchaser than those offered to shareholders.

 

C. Material Contracts

 

During the past two years, we were not a party to any material contract outside the ordinary course of business.

 

D. Exchange Controls

 

The Central Bank is responsible for, among other things, monetary policies and exchange controls in Chile. Appropriate registration of a foreign investment in Chile grants the investor access to the Formal Exchange Market. Foreign investments can be registered with the Foreign Investment Committee under Decree Law No. 600 or can be registered with the Central Bank under the Central Bank Act. The Central Bank Act is an organic constitutional law requiring a “special majority” vote of the Chilean Congress to be amended. Since April 18, 2001, all exchange controls in Chile have been eliminated.

 

Previously, Chilean law mandated that holders of shares of Chilean companies that were not residents of Chile register as foreign investors under one of the foreign investment regimes contemplated by Chilean law in order to receive dividends, sale proceeds or other amounts with respect to their shares remitted outside Chile through the Formal Exchange Market. Under the Foreign Investment Contract (as defined herein), the Depositary, on behalf of ADS holders, is granted access to the Formal Exchange Market to convert cash dividends from Chilean pesos to U.S. dollars and to pay such U.S. dollars to ADS holders outside Chile, net of taxes, and no separate registration by ADR holders is required. As of April 19, 2001, the Central Bank deregulated the Exchange Market, eliminating the need to obtain approval from the Central Bank in order to remit dividends, but at the same time eliminating the possibility of guaranteeing access to the Formal Exchange Market. However, this did not affect the current Foreign Investment Contract, which was signed prior to April 19, 2001, and which still permits access to the Formal Exchange Market based on the prior approval of the Central Bank. Therefore, the holders of ADRs of Santander-Chile are still subject to the Foreign Investment Contract, including its clauses referring to the prior exchange rules including the now extinct Chapter XXVI of the Compendium.

 

142

 

 

E. Taxation

 

The following discussion summarizes certain Chilean tax and United States federal income tax consequences to beneficial owners arising from the ownership and disposition of our common stock or ADSs. The summary does not purport to be a comprehensive description of all potential Chilean and United States federal income tax considerations that may be relevant to a decision to own or dispose of our common stock or ADSs and is not intended as tax advice to any particular investor. This summary does not describe any tax consequences arising under the laws of any state, locality or other taxing jurisdiction other than Chile and the United States.

 

Prior to December 19, 2023, there was no income tax treaty effective between the United States and Chile. However, the Convention between the Government of the United States of America and the Government of the Republic of Chile for the Avoidance of Double Taxation and Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital was signed on February 4, 2010, and it, along with the related Protocol (together, the “U.S.-Chile Double Tax Treaty”), entered into force on December 19, 2023. With respect to taxes withheld at source, the U.S.-Chile Double Tax Treaty will have effect for amounts paid or credited on or after February 1, 2024. For all other taxes, the U.S.-Chile Double Tax Treaty will have effect for taxable periods beginning on or after January 1, 2024. U.S. investors should consult their tax advisers as to the applicability of the U.S.-Chile Double Tax Treaty in their particular circumstances.

 

Material Tax Consequences of Owning Shares of Our Common Stock or ADSs

 

Chilean Taxation

 

The following is a summary of certain Chilean tax consequences of the ownership and disposition of shares of our common stock or of ADSs evidenced by ADRs by Foreign Holders (as defined herein). The summary does not purport to be a comprehensive description of all of the tax considerations that may be relevant to a decision to own or dispose of shares of our common stock or ADSs and does not purport to address the tax consequences applicable to all categories of investors, some of whom may be subject to special rules. Holders of shares of our common stock or ADSs are advised to consult their tax advisers concerning the Chilean and other tax consequences of the ownership and disposition of shares of our common stock or of ADSs evidenced by ADRs.

 

The description of Chilean tax laws set forth below is based on Chilean laws in force as of the date of this Annual Report and can be subject to any changes in such laws occurring after the date of this Annual Report. Although it is uncommon, legal changes can be made on a retroactive basis. However, changes in regulations or interpretations held by the Chilean tax authorities may not be used retroactively against taxpayers who acted in good faith relying on such modified regulations or interpretations.

 

For purposes of this summary, the term “Foreign Holder” means either (1) in the case of an individual, a person who is not resident or domiciled in Chile; or (2) in the case of a legal entity, a legal entity that is not organized under the laws of Chile, unless the shares of our common stock or ADSs are assigned to a branch or a permanent establishment of such entity in Chile. For purposes of Chilean taxation, (a) an individual holder is resident in Chile if he or she has remained in Chile for a period of more than 183 days in any 12-month period (which need not be consecutive), and (b) an individual is domiciled in Chile if he or she resides in Chile with the actual or presumptive intent of staying in Chile (intention that can be evidenced by circumstances such as the acceptance of employment in Chile or the relocation to Chile of his or her family).

 

The Income Tax Law provides that a Foreign Holder is subject to income taxes on his or her Chilean-sourced income. For these purposes, Chilean source income means earnings from activities performed within Chilean territory or from sales, dispositions, or other transactions in connection with assets or goods located in Chile. Indirect sale regulations may also attribute Chilean sourced income.

 

Taxation of Dividends

 

Cash dividends paid by us with respect to shares of our common stock held by a Foreign Holder, including shares represented by ADSs, will be subject to a 35% Chilean Withholding Tax (“WHT”), which is withheld, filed and paid over by us. If we have paid Corporate Income Tax (“CIT”) on the income from which the dividend is paid, a credit for the CIT (reduced, in certain circumstances by a related fiscal debit, as described below) effectively reduces the rate of WHT. When a credit is available, the WHT is computed by applying the 35% rate to the pre-tax amount needed to fund the dividend and then subtracting from the tentative WHT so determined the amount of CIT actually paid on the pre-tax income. For determining the pre-tax amount of the dividend, the CIT credit will depend on the amounts accumulated in the Accumulated Credit Balance (SAC), at the date of withdrawal or distribution. In general, 35% of the CIT paid on the income from which a dividend is paid gives rise to a fiscal debit owed to the Chilean Treasury at the time the dividend distribution is made to a Foreign Holder. Accordingly, a Foreign Holder generally may apply a net credit equal to only 65% of the CIT to reduce WHT.

 

143

 

 

However, if the Foreign Holder is a resident of a country with which Chile has a tax treaty for the avoidance of double taxation (a “Double Tax Treaty”) in force, the Foreign Holder may be entitled to apply the entire CIT against WHT otherwise due. Moreover, if the Foreign Holder is a resident of a country with a signed Double Tax Treaty that has not entered into force as of January 1, 2020 (as in the case of the United States), the Foreign Holder would also be entitled to a 100% CIT credit, without reduction by any related fiscal debit, until December 31, 2026. If by such date the treaty has not entered into force, the Foreign Holder will be subject to the general rules, and hence entitled only to a net credit of 65% of the CIT as described above. Please note that the U.S.-Chile Double Tax Treaty came into effect as of January 1, 2024 for all taxes except those withheld at source, and for all taxes as of February 1, 2024.

 

In accordance with the above, upon the distribution of profits to Foreign Holders, a 35% WHT applies, and only 65% of the CIT is creditable against such WHT, with the remaining 35% being paid back to the Chilean Treasury; thus, the combined tax rate on profits earned in Chile amounts to 44.45%. However, if the Foreign Holder resides in a country with which Chile has a Double Tax Treaty in force, the full 27% CIT is creditable, resulting in combined tax rate of 35%.

 

To prove residency in a country with which Chile has a Double Tax Treaty, whether signed or in force, a Foreign Holder must produce a government-issued residence certificate, duly translated and apostilled or legalized, recognizing the taxpayer as a resident of the corresponding country and sign a corresponding sworn statement. Foreign Holders are urged to consult with their tax advisers regarding all requirements to be entitled to the 100% CIT credit.

 

The WHT applicable to withdrawals, remittances or distributions abroad must be determined taking into account an interim CIT credit, based on the corporate tax rate in force in the year of the remittance or distribution. Therefore, taxation of the withdrawal, remittance or distribution shall occur at year-end. Any withholding tax difference determined at year-end must: a) be paid in the annual tax return to be declared by the Chilean company in April of the following year or b) be requested as a refund by the Foreign Holder through an administrative process or through the annual tax return to be filed in April of the year following the distribution of the dividend.

 

The example below illustrates the effective Chilean WHT burden on a cash dividend received by a Foreign Holder, assuming a WHT rate of 35.0%, a statutory CIT rate of 27.0% and a distribution of all of the net proceeds available after payment of the CIT.

 

100% Credit available Taxable income  U.S.$100 
CIT (27.0% of U.S.$100)   (27.0)
Net proceeds available   73.0 
Dividend payment   73.0 
Withholding Tax (35.0% of the sum of the dividend (U.S.$73.0) and the available CIT credit (U.S.$27.0))   35.0 
CIT credit   (27.0)
Payable WHT   8.0 
    65 
Net dividend received   (73.0-8.0)
    11.0%
Effective dividend withholding tax rate   (8.0/73.0)

 

144

 

 

65% Credit available Taxable income  U.S.$100 
CIT (27.0% of U.S.$100)   (27.0)
Net proceeds available   73.0 
Dividend payment   73.0 
Withholding Tax (35.0% of the sum of the dividend (U.S.$73.0) and the available CIT credit (U.S.$27.5))   35.0 
CIT credit   (27.00)
CIT debt   9.45 
Payable WHT   17.45 
    55.55 
Net dividend received   (73.0-17.45)
    24.0 
Effective dividend withholding tax rate   (17.45/73.0)

 

Dividend distributions made in kind would be subject to the same Chilean tax rules as cash dividends. The U.S.-Chile Double Tax Treaty came into effect as of January 1, 2024, (with some provisions becoming effective on February 1, 2024); hence we recommend investors should consult their tax advisers as to the applicability of the treaty for their own circumstances.

 

Taxation of Capital Gains

 

Gain realized on the sale, exchange, or other disposition by a Foreign Holder of ADSs should not be subject to direct or indirect Chilean taxation, provided that such sale or disposition occurs outside Chile and that the depositor is also a foreign party. Provided these requirements are met, these gains will be understood as foreign source gains. The deposit and withdrawal of shares of common stock in exchange for ADSs should also not be subject to any Chilean taxes as there will be no transfer of shares of common stock.

 

Gain recognized on a sale or exchange of shares of common stock (as distinguished from sales or exchanges of ADSs representing such shares of common stock) by a Foreign Holder will be subject to WHT. This tax must be withheld by the purchaser, with an interim rate of 10.0% of the total price without any deduction, unless the gain subject to taxation can be determined, in which case the withholding will be equal to 35.0% of the gain. Such 35.0% rate could be reduced either by the application of local provisions (e.g., exemptions on the sale of actively traded stock by institutional investors, reduced rates on the sale of actively traded stock) or if the provisions of a Double Tax Treaty were to apply (providing also for both exempted or lowered tax rates on certain capital gains).

 

Notwithstanding the above, if the seller shows evidence that no capital gain was generated, the WHT would not be applicable. The purchaser will be released of its withholding obligations only if a particular set of documents is kept for such purpose. For tax purposes, the capital gain shall be the difference between the sales price and the acquisition cost of the stock.

 

The tax basis of shares of common stock received in exchange for ADSs will be the acquisition value of such shares. The valuation procedure set forth in the deposit agreement states that the highest price at which shares of common stock were exchanged on the Santiago Stock Exchange on the date of the exchange generally will determine the acquisition value for this purpose. Consequently, the conversion of ADSs into shares of common stock and sale of such shares of common stock for the value established under the deposit agreement made on the date of the exchange will not generate a capital gain subject to taxation in Chile. In the case where ADSs were exchanged for shares and the subsequent sale of the shares is made at a valuation which is different from the one on which the exchange is recorded in the shareholders’ registry of the issuer, capital gains subject to taxation in Chile may be generated, depending on the difference between the acquisition value and the sale price.

 

On October 1, 1999, the Chilean Internal Revenue Service issued Ruling N°3,708 whereby it allowed Chilean issuers of ADSs to amend the Deposit Agreements to which they are parties in order to include a clause that states that, in the case that the exchanged shares are sold by the ADSs’ holder on a Chilean stock exchange, either on the same day on which the exchange is recorded in the shareholders’ registry of the issuer or within the two prior business days to such date, the acquisition price of such exchanged shares shall be the price registered in the invoice issued by the stock broker that participated in the sale transaction.

 

145

 

 

Consequently, as we have included this clause in the form of ADRs attached to the deposit agreement, the capital gain that might be generated if the shares received in exchange for ADSs were sold within two days prior to the date on which the exchange is recorded in the shareholders’ registry of the issuer, should not be subject to Chilean taxation. Distribution and exercise of preemptive rights relating to the shares of common stock will not be subject to Chilean taxation.

 

Cash amounts received in exchange for the shares or assignment of preemptive rights relating to the shares will be subject to both the CIT and the WHT (the former being creditable against the latter to the extent described above). In certain cases, and provided certain requirements are met, capital gains realized on the sale of actively traded stock of Chilean public companies by institutional investors may be exempt from Chilean income taxes.

 

Our stock is currently considered to be an actively traded stock in the Santiago Stock Exchange, and Foreign Holders of the stock who are institutional investors may qualify for an income tax exemption. Foreign Holders are urged to consult with their own tax advisers to determine whether an exemption applies to them.

 

The U.S.-Chile Double Tax Treaty came into effect as of January 1, 2024 (with some provisions becoming effective on February 1, 2024); hence we recommend investors should consult their tax advisers as to the applicability of the treaty in their circumstances.

 

Other Chilean Taxes

 

No Chilean inheritance, donation or succession taxes apply to the transfer or disposition of the ADSs by a Foreign Holder, but such taxes generally will apply to the transfer at death or by donation of shares of our common stock by a Foreign Holder. No Chilean stamp, issue, registration or similar taxes or duties apply to Foreign Holders of shares or ADSs.

 

Withholding Tax Certificates

 

Upon request, we will provide to Foreign Holders appropriate documentation evidencing the payment of Withholding Taxes. For further information, the investor should contact: Cristian Vicuña, irelations@santander.cl. Dividends payable to holders of ADSs are net of foreign currency conversion expenses of the Depositary and will be subject to the Withholding Tax currently at the rate of 35% (subject to credits in certain cases as described above).

 

U.S. Federal Income Tax Considerations

 

The following is a discussion of material U.S. federal income tax consequences of owning and disposing of shares of our common stock or ADSs to U.S. holders described below, but it does not purport to be a comprehensive description of all of the tax considerations that may be relevant to a particular person’s decision to hold such common stock or ADSs. The discussion applies only if you are a U.S. holder holding shares of our common stock or ADSs as capital assets for U.S. federal income tax purposes. It does not address all aspects of U.S. federal income taxation that may be relevant to you in light of your particular circumstances, including the alternative minimum tax and the Medicare contribution tax, nor does it describe all tax consequences that may be relevant to U.S. holders subject to special rules, such as:

 

certain financial institutions;

 

insurance companies;

 

dealers and traders in securities who use a mark-to-market method of tax accounting;

 

persons holding shares or ADSs as part of a hedge, “straddle,” conversion transaction, integrated transaction or similar transaction;

 

persons whose functional currency for U.S. federal income tax purposes is not the U.S. dollar;

 

partnerships or other entities classified as partnerships for U.S. federal income tax purposes;

 

146

 

 

tax-exempt entities, including “individual retirement accounts” or “Roth IRAs”;

 

persons holding shares of our common stock or ADSs that own or are deemed to own ten percent or more of the voting power or value of our stock;

 

persons who acquired shares of our common stock or ADSs pursuant to the exercise of any employee stock option plan or otherwise as compensation; or

 

persons whose shares or ADSs are held in connection with a trade or business conducted outside the United States.

 

If an entity that is classified as a partnership for U.S. federal income tax purposes owns shares of our common stock or ADSs, the U.S. federal income tax treatment of a partner will generally depend on the status of the partner and upon the activities of the partnership. Partnerships owning shares of our common stock or ADSs and partners in such partnerships should consult their tax advisers as to the particular U.S. federal income tax consequences of owning and disposing of the shares of our common stock or ADSs.

 

This discussion is based on the Code, the U.S.-Chile Double Tax Treaty, administrative pronouncements, judicial decisions and final, temporary and proposed Treasury regulations, all as of the date hereof. These laws are subject to change, possibly on a retroactive basis. It is also based in part on representations by the Depositary and assumes that each obligation under the deposit agreement and any related agreement will be performed in accordance with its terms. In addition, this discussion does not address U.S. state, local and non-U.S. tax consequences. Please consult your tax advisers concerning the U.S. federal, state, local and non-U.S. tax consequences of owning and disposing of shares or ADSs in your particular circumstances.

 

As used herein, a “U.S. holder” is a person that for U.S. federal income tax purposes, is a beneficial owner of shares of our common stock or ADSs and is:

 

a citizen or individual resident of the United States;

 

a corporation, or other entity taxable as a corporation, created or organized in or under the laws of the United States, a state thereof or the District of Columbia; or

 

an estate or trust the income of which is subject to U.S. federal income taxation regardless of its source.

 

In general, if you own ADSs, you will be treated as the owner of the underlying shares represented by those ADSs for purposes of the U.S.-Chile Double Tax Treaty and for U.S. federal income tax purposes. Accordingly, no gain or loss will be recognized if you exchange ADSs for the underlying shares represented by those ADSs.

 

This discussion assumes that we are not, and will not become, a passive foreign investment company, as described below.

 

Taxation of Distributions

 

Distributions paid on shares of our common stock or ADSs, other than certain pro rata distributions of common shares or rights, will be treated as dividends to the extent paid out of our current or accumulated earnings and profits (as determined under U.S. federal income tax principles). Because we do not maintain calculations of our earnings and profits under U.S. federal income tax principles, it is expected that distributions generally will be reported to U.S. holders as dividends. Subject to applicable limitations, certain dividends paid by “qualified foreign corporations” to certain non-corporate U.S. holders may be taxable at rates applicable to long-term capital gains. A foreign corporation is treated as a qualified foreign corporation with respect to dividends paid on stock that is readily tradable on a securities market in the United States, such as the NYSE where our ADSs are traded. A foreign corporation may also qualify as a qualified foreign corporation with respect to dividends if it is eligible for benefits of a comprehensive income tax treaty with the United States that has been determined by the U.S. Secretary of the Treasury to be satisfactory and that includes an exchange of information program. On December 28, 2023, the U.S. Internal Revenue Service (the “IRS”) released a notice adding the U.S.-Chile Double Tax Treaty to the list of current treaties between the U.S. and various countries that meet both of these requirements. You should consult your tax advisers to determine whether favorable rates may apply to dividends you receive and whether you are subject to any special rules that limit your ability to be taxed at such favorable rates. The amount of the dividend will include any amounts withheld by us or our paying agent in respect of Chilean taxes at the effective rate (after credit for CIT) as described above under “—Material Tax Consequences of Owning Shares of Our Common Stock or ADSs—Chilean Taxation— Taxation of Dividends.” The amount of the dividend will be treated as foreign-source dividend income to you and will not be eligible for the dividends-received deduction generally allowed to U.S. corporations under the Code.

 

147

 

 

Dividends will be included in your income on the date of your (or in the case of ADSs, the Depositary’s) receipt of the dividend. The amount of any dividend income paid in Chilean pesos will be the U.S. dollar amount calculated by reference to the exchange rate in effect on the date of receipt regardless of whether the payment is in fact converted into U.S. dollars. If the dividend is converted into U.S. dollars on the date of receipt, you should not be required to recognize foreign currency gain or loss in respect of the dividend income. You may have foreign currency gain or loss if the dividend is converted into U.S. dollars after the date of receipt.

 

Subject to applicable limitations that may vary depending upon your circumstances, Chilean taxes withheld from cash dividends on shares of our common stock or ADSs, reduced by the credit for any CIT, as described above under “—Chilean Taxation—Taxation of Dividends,” might be creditable against your U.S. federal income tax liability. On December 28, 2021, new Treasury regulations pertaining to foreign tax credits (the “Final Treasury Regulations”) were released that impose significant new limitations on the non-U.S. taxes (including withholding taxes) for which a foreign tax credit can be claimed. Corrections with respect to the Final Treasury Regulations were published on July 27, 2022, and the IRS has released a series of notices, most recently on December 11, 2023, which modify and, in some cases, indefinitely defer the application of certain aspects of the Final Treasury Regulations. We have not determined whether these limitations will prevent a U.S. Holder from claiming a foreign tax credit with respect to any withholding tax imposed on dividends on ADRs or shares of our common stock. As discussed above, the U.S.-Chile Double Tax Treaty entered into force on December 19, 2023. During periods of its applicability, Chilean income taxes withheld from dividends on shares or ADSs in excess of the rate provided in the U.S.-Chile Double Tax Treaty will not be creditable by a U.S. holder who is eligible for the benefits of the the U.S.-Chile Double Tax Treaty. The rules governing foreign tax credits, including the Final Treasury Regulations, are complex and you should consult your tax advisers to determine whether they may limit your ability to make effective use of foreign tax credits. Instead of claiming a credit, you may, at your election, deduct such Chilean taxes in computing your taxable income, subject to generally applicable limitations under U.S. law. An election to deduct foreign taxes instead of claiming foreign tax credits must apply to all foreign taxes paid or accrued in the taxable year.

 

Sale or Other Disposition of Shares or ADSs

 

For U.S. federal income tax purposes, gain or loss you realize on the sale or other disposition of shares of our common stock or ADSs generally will be capital gain or loss, and will be long-term capital gain or loss if you held the shares of our common stock or ADSs for more than one year. The amount of your gain or loss will be equal to the difference between your tax basis in the shares of our common stock or ADSs disposed of and the amount realized on the disposition, in each case as determined in U.S. dollars.

 

As discussed above under “—Material Tax Consequences of Owning Shares of Our Common Stock or ADSs—Chilean Taxation— Taxation of Capital Gains”, gain realized by a U.S. Holder on the sale or other disposition of our ADSs should be exempt from Chilean tax on capital gains provided that certain requirements are met. Similarly, gain realized by a U.S Holder that qualifies for the benefits of the U.S.-Chile Double Tax Treaty on the sale or other disposition of our common stock may be exempt from Chilean tax on capital gains under the U.S.-Chile Double Tax Treaty, provided certain conditions are met. If a Chilean tax is withheld on the sale or disposition of the shares of our common stock or ADSs, your amount realized will include the gross amount of the proceeds of such sale or disposition before deduction of the Chilean tax. See “—Chilean Taxation—Taxation of Capital Gains” for a description of when a disposition may be subject to taxation by Chile. Such gain or loss generally will be U.S.-source gain or loss for foreign tax credit purposes. The Final Treasury Regulations generally preclude U.S. persons from claiming a foreign tax credit with respect to any tax imposed on gains from the disposition of shares or ADSs by a jurisdiction that does not have in effect an applicable income tax treaty with the United States (which for periods prior to the U.S.-Chile Double Tax Treaty’s entry into force, included Chile), although such taxes may be applied to reduce the amount realized on the disposition. Consequently, if you do not qualify for the benefits of the U.S.-Chile Double Tax Treaty or you disposed of shares of our common stock or ADSs prior to the treaty’s entry into force, you may not be able to credit any Chilean tax imposed on the disposition of shares of our common stock or ADSs against your taxable income unless you have other foreign-source income in the appropriate foreign tax credit category. A U.S. holder who is eligible for the benefits of the U.S.-Chile Double Tax Treaty and whose gain from the sale of shares is not exempt from Chilean tax under the U.S.-Chile Double Tax Treaty may elect to treat disposition gain that is subject to Chilean tax as foreign-source gain and claim a credit in respect of the tax.

 

148

 

 

Passive Foreign Investment Company Rules

 

Based on proposed Treasury regulations (the “Proposed Regulations”), including those which are proposed to be effective for taxable years beginning after December 31, 1994 (and on which taxpayers may currently rely pending finalization), we believe that we were not a “passive foreign investment company” (a “PFIC”) for U.S. federal income tax purposes for the year ended December 31, 2023. However, since the Proposed Regulations may not be finalized in their current form and since PFIC status depends upon the composition of a company’s income and assets and the market value of its assets (including, among others, less than 25 percent owned equity investments) from time to time, and, if more recently proposed Treasury regulations are finalized in their current form, the location of activities that produce active banking income and the location of our customers, there can be no assurance that we will not be a PFIC for any taxable year. If we were a PFIC for any taxable year during which you held an ADS or a share of our common stock, certain adverse tax consequences could apply to you.

 

If we were a PFIC for any taxable year during which you held shares of our common stock or ADSs, gain recognized by you on a sale or other disposition (including certain pledges) of a share of our common stock or an ADS would generally be allocated ratably over your holding period for the share of our common stock or ADS. The amounts allocated to the taxable year of the sale or other disposition and to any year before we became a PFIC would be taxed as ordinary income. The amount allocated to each other taxable year would be subject to tax at the highest rate in effect for individuals or corporations, as appropriate, for that taxable year, and an interest charge would be imposed on the resulting tax liability for that taxable year. Similar rules would apply to any distribution in respect of shares of our common stock or ADSs that exceeds 125% of the average of the annual distributions on shares of our common stock or ADSs received by you during the preceding three years or your holding period, whichever is shorter. Certain elections may be available that would result in alternative treatments of the shares of our common stock or ADSs (including, with respect to our ADSs, a mark-to-market election). In addition, if we were a PFIC for a taxable year in which we pay a dividend or the prior taxable year, the favorable rates discussed above with respect to dividends paid to non-corporate holders would not apply.

 

If we were to be treated as a PFIC in any taxable year, a U.S. holder may be required to file reports with the Internal Revenue Service containing such information as the Treasury Department may require.

 

Information Reporting and Backup Withholding

 

Payment of dividends and sales proceeds that are made within the United States or through certain U.S.-related financial intermediaries generally are subject to information reporting and may be subject to backup withholding, unless you are a corporation or other exempt recipient or in the case of backup withholding, you provide a correct taxpayer identification number and certify that you are not subject to backup withholding.

 

The amount of any backup withholding from a payment to you will be allowed as a credit against your U.S. federal income tax liability and may entitle you to a refund, provided that the required information is timely furnished to the Internal Revenue Service.

 

Certain U.S. holders may be required to report information relating to stock of a non-U.S. person, subject to certain exceptions (including an exception for stock held in custodial accounts maintained by a U.S. financial institution). You should consult your tax advisers regarding any reporting obligations you may have with respect to shares of our common stock or ADSs.

 

F. Dividends and Paying Agents

 

Not applicable.

 

G. Statement by Experts

 

Not applicable.

 

149

 

 

H. Documents on Display

 

The documents concerning us which are referred to in this Annual Report may be inspected at our offices at Bandera 140, 20th floor, Santiago, Chile. We are subject to the information reporting requirements of the Exchange Act, except that, as a foreign issuer, we are not subject to the proxy rules or the short-swing profit and disclosure rules of the Exchange Act. The SEC maintains a website on the Internet at http://www.sec.gov that contains reports and information statements and other information about us. The reports and information statements and other information about us can be downloaded from the SEC’s website or our investor relations website https://santandercl.gcs-web.com. None of the information contained on our website is incorporated by reference into, or forms part of, this Annual Report.

 

I. Subsidiary Information

 

Not applicable.

 

J. Annual Report to Security Holders

 

Not applicable.

 

ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

Introduction

 

The principal types of risk inherent in Santander-Chile’s business are market, liquidity, operational and credit risks. The effectiveness with which we are able to manage the balance between risk and reward is a significant factor in our ability to generate long term, stable earnings growth. Toward that end, our Board and senior management places great emphasis on risk management.

 

For more information on our Integral Risk Committee, Audit Committee, Asset and Liability Committee and Market Committee, see “Item 6. Directors, Senior Management and Employees.”

 

Risk Department

 

All issues regarding risk in the Bank are the responsibility of the Bank’s Risk Department. The Risk Department reports to the CEO but has full independence, and no risk decisions can be made without its approval. The following diagram illustrates the governance of our risk division including the committees with approval power:

 

 

150

 

 

Below is an organizational chart of the Risk Department:

 

 

1. Credit Risk

 

The impairment model applies to all financial assets measured at amortized cost and fair value through other comprehensive income (FVOCI), including commitment and contingent loans. Investments in equity are outside of the scope of the new impairment requirements. For more information, see “Item 5 Operating and financial review and prospects—Critical Accounting Policies.”

 

The Bank has defined default on the following basis:

 

Corporate: when exposure is more than 89 days past due, it has been restructured, it is in judicial collection, pulling effect defined as the entire outstanding amount on any loan which has an instalment 90 days or more past due.

 

Other: when exposure is more than 89 days past due, it has been restructured, it is in judicial collection, it has been written off, or has been identified as impaired by an internal risk committee.

 

An exposure will be considered as defaulted when the past-due amounts of an exposure exceed materiality thresholds for 89 or more consecutive days.

 

The Bank considers reasonable and supportable information that is available without undue cost or effort and that may affect the credit risk on a financial instrument, including forward looking information to determine a significant increase in credit risk since the initial recognition. Forward looking information includes past events, current conditions and forecasts or future economic conditions (macro-economic data). Credit risk assessment and forward-looking information (including macro-economic factors), includes quantitative and qualitative information based on the Bank’s classification policy:

 

a.Adverse changes in the financial situation, such as a significant increase in debt levels.

 

b.Significant drops in turnover or, in recurring cash flows.

 

c.Significant narrowing of operating margins or recurring income.

 

d.Significant adverse changes in credit risk cost, due to changes in this risk after initial recognition.

 

e.Other changes in the transaction’s credit risk that would impact on conditions being significantly different if the transaction were originated or reissued on the reference date.

 

f.An actual or expected reduction of the integral credit rating of the operation (client’s integral rating) or decrease in the performance score.

 

g.An actual or expected significant decrease in the price or external credit rating of the mail operation, as well as other external market indicators of the credit risk for similar operations with the same expected life.

 

The Bank will classify an operation as Stage 2 when the past-due amounts of an exposure exceed materiality thresholds for 90 or more consecutive days.

 

151

 

 

Expected credit loss measurement

 

The ECL are 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 Bank considered a multi-factor analysis to perform credit risk analysis. The Bank conducts a corporate evaluation to assess whether objective evidence of impairment exists for loans that are individually significant, and then conducts a separate evaluation of loans that are not individually significant and loans which are significant but for which there is no objective evidence of impairment available under custom monitoring.

 

Credit Risk Governance

 

The Risk Division, our credit analysis and risk management group, is largely independent of our business areas. Risk evaluation teams interact regularly with our clients. For larger transactions, risk teams in our headquarters work directly with clients when evaluating credit risks and preparing credit applications. Various credit approval committees, all of which include Risk Division and Commercial Division personnel, must verify that the appropriate qualitative and quantitative parameters are met by each applicant. Each committee’s powers are defined by our Board of Directors.

 

Santander-Chile’s governance rules establish an Integral Risk Committee. This committee is responsible for revising and following all risks that may affect us, including reputational risk, allowing for an integral risk management. This committee serves as the governing body through which the Board supervises all risk functions. It also evaluates the reasonability of the systems for measurement and control of risks. This Committee includes the Vice Chairman of the Board and five Board members.

 

The Board has delegated the duty of credit risk management to the Risk Committee, as well as to the Bank’s risk departments, whose roles are summarized below:

 

Formulate credit policies by consulting with the business units, meeting requirements of guarantees, credit evaluation, risk rating and submitting reports, documentation and legal procedures in compliance with the regulatory, legal and internal requirements of the Bank.

 

Establish the structure to approve and renew credit requests. The Bank structures credit risks by assigning limits to the concentration of credit risk in terms of individual debtor, debtor group, industry segment and country. Approval levels are assigned to the corresponding officials of the business unit (commercial, consumer, SMEs) to be exercised by that level of management. In addition, those limits are continually revised. Teams in charge of risk evaluation at the branch level interact on a regular basis with customers; however, for larger credit requests, the risk team from the head office and the Executive Risk Committee works directly with customers to assess credit risks and prepare risk requests.

 

Limit concentrations of exposure to customers or counterparties in geographic areas or industries (for accounts receivable or loans), and by issuer, credit rating and liquidity.

 

Develop and maintain the Bank’s credit risk classifications for the purpose of classifying risks according to the degree of exposure to financial loss that is exhibited by the respective financial instruments, with the aim of focusing risk management specifically on the associated risks.

 

Revise and evaluate credit risk. Management’s risk divisions are largely independent of the Bank’s commercial division and evaluate all credit risks in excess of the specified limits prior to loan approvals for customers or prior to the acquisition of specific investments. Credit renewal and reviews are subject to similar processes.

 

For more detail on credit risk metrics please see: “Item 5. Operating and Financial Review and Prospects—A. Operating Results—Provision for loan losses”, “Item 5. Operating and Financial Review and Prospects—B. Selected Statistical Information- Loan Portfolio”, “Item 5. Operating and Financial Review and Prospects—B. Selected Statistical Information- Credit Ratios”, “Note 8 – Financial Assets at Amotized Costs” and “Note 37-Risk Management-Credit Risk”.

 

152

 

 

2. Non-financial risks

 

Following the Basel framework, the Bank defines operational risk as the risk of losses arising from defects or failures in its internal processes, people, systems or external events, thus covering risk categories such as fraud, technological, cyber, legal and conduct risk.

 

Operational risk is inherent to all products, activities, processes and systems and is generated in all business and support areas. For this reason, all employees are responsible for managing and controlling the operational risks generated in their sphere of action. The Bank’s goal in terms of operational risk management and control is focused on identifying, evaluating and mitigating sources of risk, regardless of whether they have materialized or not. The analysis of operational risk exposure contributes to the establishment of risk management priorities.

 

The following table summarizes our net losses from operational risks in 2023 compared to 2022. In 2023, the 19.0% decrease in operational-related losses was mainly due to improved security measures to control credit card and cyber fraud.

 

   As of December 31,   % Change 
   2023   2022   2023/2022 
   (Ch$ millions)     
Net losses from operational risks            
Fraud   2,759    6,409    (57.0)%
Labor related   5,611    6,704    (16.3)%
Client / product related   761    116    556.0%
Damage to fixed assets   255    221    15.4%
Business continuity / Systems   164    979    (83.2)%
Processing   4,418    2,815    56.9%
Total   13,968    17,245    (19.0)%

 

Governance

 

The risk management program contemplates that all relevant risk issues must be reported to the Board of Directors, the Integral Risk Committee and the Non-Financial Risk Committee.

 

Risk identification, measurement and assessment model

 

A series of quantitative and qualitative techniques and tools have been defined by the Bank to identify, measure and assess operational risk. The quantitative analysis of this risk assessment is carried out mainly with tools that record and quantify the level of potential losses associated with operational risk events. The qualitative analysis seeks to assess aspects of exposure and hedging (including the control environment). The most important operational risk tools used by Santander Chile are an internal events database, operational risk control self-assessment, analysis of operational risk scenarios, appetite of corporate and local indicators, and internal audit and regulatory recommendations, among others.

 

Operational risk management

 

To accomplish our operational risk objectives, we have established a risk model based on three lines of defense, with the objective of continuously improving and developing our management and control of operational risks. The defense lines consist of: (i) the business and support areas (first line of defense), responsible for managing the risks related to their processes; (ii) the non-financial risk area (second line of defense), in charge of supporting the first line of defense in relation to the fulfillment of its direct responsibilities and; (iii) the internal audit function (third line of defense) responsible for verifying, independently and periodically, the adequacy of the risk identification and management processes and procedures, in accordance with the guidelines established in the Internal Audit Policy and submitting the results of its recommendations for improvement to the Audit Committee. For further information, see “Item 16K. Cybersecurity.”

 

153

 

 

Our methodology consists of the evaluation of the risks and controls of a business from a broad perspective and includes a plan to monitor the effectiveness of such controls and the identification of eventual weaknesses. The main objectives of the Bank and its subsidiaries in terms of operational risk management are the following:

 

Identify, evaluate, inform, manage and monitor the operational risk in connection with activities, products, and processes carried out or commercialized by the Bank and its subsidiaries;

 

Build a strong culture of operational risk management and internal controls, with clearly defined and adequately segregated responsibilities between business and support functions, whether these are internally-developed or outsourced to third parties;

 

Generate effective internal reports in connection with issues related to operational risk management, with a clearly defined escalation protocol; and

 

Control the design and application of effective plans to deal with contingencies that ensure business continuity and losses control.

 

Cyber-security and data security plans

 

The Bank continuously monitors cyber-security risks and has implemented preventative measures to be prepared for any cyber-attack. Likewise, the internal cyber-security model based on best practices and international standards, is periodically evaluated for its maturity level. Through these evaluations, points of improvement have been identified and actions and remediations have been established and incorporated into our cybersecurity plans. For further information, see “Item 16K. Cybersecurity.”

 

Business Continuity Management: Ensuring the realization of critical process during contingencies

 

The Bank has a Business Continuity Management System, which covers the entire organization in order to ensure the execution of the activities that may cause significant negative impacts (operational, reputation, consumer services, legal and operational losses) to the organization. The Non-financial Risk Department, through the IT Risk Department (BCM specialized area, as part of the second line of defense), leads the control and implementation of the model and policies defining the roles and responsibilities of each line of defense, where the first line of defense has a main role that involves the identification of their process, the business impact analysis of each risk according to the methodology, the preparation of business continuity plans and strategies to respond to each contingency scenario and ensure the realization of the critical processes, the testing and continuous updating of the information to secure the resources needed (at least annually).

 

The Bank is constantly facing different types of contingencies (mainly natural disasters, pandemics, social movements, protests, among others), which has proven to be effective in order to maintain, social movements, protests, among others), which has proven to be effective in order to maintain and ensure the business continuity of the organization. We are constantly detecting new opportunities to improve the current mitigation actions and contingency plans allowing the critical departments to recover after the events that may occur in the future.

 

Role of Santander Group’s Global Risk Division: Operational Risk

 

In matters regarding operational risk, Santander Spain’s Global Risk Department’s role is to define certain global policies, guidelines and procedures regarding operational risk. The Corporate Operational Risk Committee is the main body in which the different units of Santander discuss and review the major operational risk events and policies.

 

3. Market Risks

 

This section describes the market risks that we are exposed to, the tools and methodology used to control these risks, the portfolios over which these market risk methods were applied and quantitative disclosure that demonstrate the level of exposure to market risk that we are assuming. This section also discloses the derivative instruments that we use to hedge exposures and offer to our clients.

 

154

 

 

Market risk is the risk of losses due to unexpected changes in interest rates, foreign exchange rates, inflation rates and other rates or prices. We are exposed to market risk mainly as a result of the following activities:

 

trading in financial instruments, which exposes us to interest rate and foreign exchange rate risk;

 

engaging in banking activities, which subjects us to interest rate risk, since a change in interest rates affected gross interest income, gross interest expense and customer behavior;

 

engaging in banking activities, which exposes us to inflation rate risk, since a change in expected inflation affects gross interest income, gross interest expense and customer behavior;

 

trading in the local equity market, which subjects us to potential losses caused by fluctuations of the stock market; and

 

investing in assets whose returns, or accounts are denominated in currencies other than the Chilean peso, which subjects us to foreign exchange risk between the Chilean peso and such other currencies.

 

The main decisions that relate to market risk for the Bank and the limits regarding market risk are made in the Asset and Liability Committee and the Market Committee. The measurement and oversight of market risks is performed by the Market Risk Department. Santander-Chile’s governance rules have established the Asset and Liability Committee and the Market Committee to monitor and control market risks.

 

Role of Santander Group’s Global Risk Division: Market Risk

 

In matters regarding Market Risk, the role of Santander Spain’s Global Risk Department is to define certain global policies, guidelines and procedures regarding market risk. The information produced by our local Market Risk Department is standardized for the whole group in order to facilitate a consolidation of risks being taken on a global basis. They review daily the consumption of limits and provide valuable input on the evolution of markets, especially regarding the Eurozone.

 

4. Market Risk: Quantitative Disclosure

 

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$36,789.36 as of December 31, 2023, Ch$35,110.98 as of December 31, 2022, Ch$30,991.74, and at December 31, 2021. 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 4.8% in 2023, 13.3% in 2022, and 6.6% in 2021. 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, but there are significantly less features in deposits and other funding sources that would increase the size of our funding base), 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.

 

155

 

 

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$1,147,193 million in 2023, a loss of Ch$1,755,795 million in 2022 and a loss of Ch$429,759 million in 2021. These larger losses in 2023 and 2022 were mainly due to higher short-term interest rates which negatively affected fixed rate liabilities swapped to short-term rates. The average gap between our interest earnings assets and total liabilities linked to the inflation, including hedging, was Ch$6,875,280 million in 2023, Ch$7,849,843 million in 2022 and Ch$6,252,221 million in 2021. Therefore, our sensitivity to a 100-basis point shift in UF inflation considering our average gap in 2023 would be approximately Ch$69 billion.

 

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 
   2023   2022   2021   2023/2022   2022/2021 
   (in millions of Ch$)         
Impact of inflation on net interest income                    
Results from UF GAP(1)    321,698    1,015,855    410,249    (68.3)%   147.6%
Annual UF inflation    4.8%   13.3%   6.6%          

 

(1)UF GAP is net interest income from asset and liabilities denominated in UFs and includes the results from hedging the size of this gap via interest rate swaps.

 

The lower result in 2023 compared to 2022 was mainly due to the lower inflation in UFs.

 

Interest Rates

 

Interest rates earned and paid on our assets and liabilities reflect, to a certain degree, inflation, expectations regarding inflation, changes in short term interest rates set by the Central Bank and movements in long term real rates. See “Item 5. Operating and Financial Review and Prospects—A. Operating Results—Interest 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. At the same time, our net interest margin tends to be adversely affected in the short term by a decrease in inflation rates since generally our UF-denominated assets exceed our UF-denominated liabilities. See “Item 5. Operating and Financial Review and Prospects—A. Operating Results—Impact of Inflation—Peso-denominated assets and liabilities.” 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 or 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.

 

156

 

 

We also maintain a substantial amount of non-interest-bearing peso-denominated demand deposits. Because such deposits are non-interest bearing and are not indexed to inflation the higher percentage of our funding that comes from this source positively impacts our net interest margin as interest rates or inflation rises and vice-versa. The ratio of the average of such demand deposits and average shareholder’s equity to average interest-earning assets was 29.0%, 32.0% and 38.9% and 33.5% for the years ended December 31, 2023, 2022 and 2021, respectively.

 

As of December 31, 2023, the detail of the maturities of assets and liabilities is as follows:

 

As of December 31, 2023  Demand   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 
   (in millions of
Ch$)
                             
Financial assets                                
Cash and deposits in banks   2,723,282                            2,723,282 
Cash items in process of collection   812,524                            812,524 
Financial assets for trading at FVTPL                                        
Financial derivative contracts and hedge contracts(1)       383,845    807,016    1,548,923    3,046,056    1,413,070    3,526,105    10,725,015 
Debt financial instruments       211        2,275    31,031    1,432    63,359    98,308 
Financial assets at FVOCI                                       
Debt financial instrument       2,277,301    10,319    319    668,856    491,471    1,087,759    4,536,025 
Other financial instruments               66,685    13,566    19,692    5,439    105,382 
Financial assets at amortized cost(2)                                        
Debt financial instruments               3,724,781    4,453,843            8,178,624 
Interbank loans   49    68,391                        68,440 
Loans and account receivable from customers   872,591    3,304,077    3,178,674    5,552,061    8,293,975    4,666,845    14,875,223    40,743,446 
Guarantee deposits (margin accounts)   2,238,900                            2,238,900 
Total financial assets   6,647,346    6,033,825    3,996,009    10,895,044    16,507,327    6,592,510    19,557,885    70,229,946 
Financial liabilities                                        
Cash items in process of being cleared   775,082                            775,082 
Financial liabilities for trading at FVTPL                                        
Financial derivative contracts and hedge contracts(1)       376,279    1,170,614    2,443,279    3,056,317    1,526,321    3,415,532    11,988,342 
Financial liabilities at amortized cost                                        
Deposits and other demand liabilities   13,537,826                            13,537,826 
Time deposits and other time liabilities   328,242    7,999,764    3,689,743    3,950,166    138,320    3,364    28,343    16,137,942 
Obligations under repurchase agreements       282,483    101                    282,584 
Interbank borrowings   18,220    2,730    4,006,532    5,821,216    34,384    173,417        10,366,499 
Issued debt instruments(3)       291,687    285,923    1,272,427    3,183,069    1,314,205    3,467,672    9,814,983 
Other financial liabilities       296,095            164    14        296,273 
Lease liabilities               20,716    37,446    22,913    23,441    104,516 
Guarantees received (margin accounts)   1,081,226                            1,081,226 
Total financial liabilities   15,740,596    9,289,038    9,152,913    13,507,804    6,719,700    3,040,234    6,934,988    64,385,273 

 

(1)Includes derivative contracts for trading purposes and hedge derivatives contracts.

 

(2)Debt financial instruments, Interbank loans and loans and accounts receivable from customer are presented on a gross basis, the related allowance are Ch$1,729 million, Ch$2 million and Ch$1,149,989 million, respectively.

 

(3)Includes Subordinated bonds for Ch$1,813,938 million which is presented as a Regulatory capital financial instruments.

 

157

 

 

The following table sets forth our average daily balance of liabilities for the years ended December 31, 2023, 2022 and 2021, in each case together with the related average nominal interest rates paid thereon.

 

   2023   2022   2021 
   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
 
Interest-bearing liabilities                                    
Savings accounts   190,469    0.3%   3.6%   198,478    0.3%   11.3%   177,779    0.3%   5.9%
Time deposits   16,392,793    23.6%   7.4%   14,114,807    20.3%   5.9%   13,174,290    22.8%   0.8%
Central Bank borrowings   5,773,345    8.3%   12.2%   5,441,584    7.8%   8.5%   5,546,895    9.6%   0.5%
Repurchase agreements   779,214    1.1%   7.2%   450,632    0.6%   3.7%   135,078    0.2%   0.7%
Mortgage finance bonds   2,063    0.0%   9.3%   5,058    0.0%   17.3%   9,105    0.0%   10.9%
Commercial paper   613,212    0.9%   5.8%   298,142    0.4%   2.4%   277,666    0.5%   0.3%
Other interest bearing liabilities   14,920,208    21.5%   8.7%   14,449,972    20.8%   8.3%   9,781,372    16.9%   9.8%
Subtotal interest-bearing liabilities   38,671,304    55.6%   8.6%   34,958,674    50.4%   7.3%   29,102,186    50.3%   3.8%
Non-liabilities                                             
Non-interest bearing deposits   11,099,866    16.0%        12,844,814    18.5%        14,035,242    24.3%     
Derivatives   10,937,411    15.7%        11,979,276    17.3%        7,666,801    13.2%     
Other non-interest bearing liabilities   4,108,850    5.9%        6,079,681    8.8%        3,000,598    5.2%     
Shareholders’ equity   4,720,294    6.8%        3,524,063    5.1%        4,062,407    7.0%     
Subtotal non-interest bearing liabilities and equity   30,866,421    44.4%        34,427,834    49.6%        28,765,048    49.7%     
Total liabilities   69,537,725    100.0%        69,386,508    100.0%        57,867,233    100.0%     

 

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 depreciated 2.9% in 2023, appreciated 0.6% in 2022 and depreciated 19.9% in 2021.

 

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. 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 relative to foreign currencies (principally the U.S. dollar).

 

158

 

 

In general, the Bank is not permitted, due to guidelines set by the ALCO and the Market Committee, to open a meaningful gap in foreign currency. Any significant difference between the spot asset position and the spot liability position in foreign currency is usually hedged using forwards and cross-currency swaps. Any remaining foreign currency risk is included as part of the trading portfolio We set an absolute limit on the size of Santander-Chile’s consolidated net foreign currency trading position, which is equivalent to the maximum differential allowed between assets and liabilities in foreign currencies, including hedging of this gap. The limit on the size of the net foreign currency position is determined by the Market Committee and is calculated and monitored by the Market Risk Department. As of December 31, 2023, this was equal to U.S.$350 million. This limit in various other currencies is as follows:

 

Currency  Limit 
   (in millions
of U.S.$)
 
U.S. dollars   350 
Euros   110 
Yen   27 
British pound   20 
Mexican peso   30 
Brazilian real   30 
Colombian peso   30 
Peruvian Sol   20 
Other European currencies   30 
Other Latin American currencies   30 
Other currencies   47.5 
Total Limit   350 

 

Foreign currency risk included in the trading portfolio is also measured and controlled using VaR. The average VAR of our foreign currency position was U.S.$2.20 million in 2023. The translation gains or loss over assets and liabilities (excluding derivatives held for trading) is 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.

 

Liquidity risk management

 

The Financial Management Division receives information from all the business units on the liquidity profile of their financial assets and liabilities, as well as breakdowns of other projected cash flows stemming from future businesses. On the basis of that information, the Financial Management Division maintains a portfolio of liquid short–term assets, comprised mainly of liquid investments, loans and advances to other banks, to make sure the Bank has sufficient liquidity. The business units’ liquidity needs are met through short–term transfers from the Financial Management Division to cover any short–term fluctuations and long–term financing to address all the structural liquidity requirements.

 

The Bank monitors its liquidity position every day, determining the future flows of its outlays and revenues. In addition, stress tests are performed at the close of each month, for which a variety of scenarios encompassing both normal market conditions and conditions of market fluctuation are used. The liquidity policy and procedures are subject to review and approval by the Bank’s Board. Periodic reports are generated by the Market Risk Department, providing a breakdown of the liquidity position of the Bank and its subsidiaries, including any exceptions and the corrective measures adopted, which are regularly submitted to the ALCO for review.

 

The Bank relies on demand deposits from Retail, Middle-Market and Corporates, obligations to banks, debt instruments, and time deposits as its main sources of funding. Our most important source of funding is our deposits. Average time deposits plus non-interest bearing demand deposits represented 39.5% of our average total liabilities and shareholders’ equity in 2023. As of December 31, 2023, the Bank’s top 20 time deposits represented 33.0% of total time deposits, or 7.5% 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.

 

159

 

 

Although most obligations to banks, debt instruments and time deposits mature in over a year, customer (retail) and institutional deposits tend to have shorter maturities and a large proportion of them are payable within 90 days. The short–term nature of these deposits increases the Bank’s liquidity risk, and hence, the Bank actively manages this risk by continual supervision of the market trends and price management. We cannot assure that in the event of a sudden or unexpected shortage of funds in the banking system, we will be able to maintain levels of funding without incurring higher funding costs, a reduction in the term of funding instruments or the liquidation of certain assets. If this were to happen, we could be materially adversely affected.

 

Liquidity Measures Implemented by the Central Bank of Chile as a Result of the COVID-19 Pandemic

 

In response to the COVID-19 pandemic, the Central Bank has made two lines of credit available to banks to reinforce their liquidity, amounting to a total of U.S.$24 billion for the whole banking system. These lines of credit bear interest at the Central Bank’s monetary policy rate (MPR), which was 4.0% as of December 31, 2021, 11.25% as of December 31, 2022 and 8.25% as of December 31, 2023. Pursuant to these lines of credit, a bank may borrow up to 3% of the aggregate amount of its consumer and commercial loan portfolios as of February 29, 2020 and may borrow up to an additional 12% if it uses the funds to provide loans to companies and individuals. The first line of credit is a facility available conditionally on loan growth (the “FCIC”) to ensure that banks continue to finance households and businesses in Chile. Loans provided under this line of credit may have maturities of up to four years and must be secured by government bonds, corporate bonds or highly rated large commercial loans as collateral. Loans provided under the second line of credit, the LCL, are unsecured and may have maturities of up to 2 years. In addition, borrowings by a bank under the LCL are limited to the aggregate amount of the liquidity reserve requirements of such bank. Ultimately, these lines of credit are intended to ensure banks have ample liquidity to enable them to continue financing Small to Mid-size Enterprises (“SMEs”) and Middle-market companies. As of December 31, 2023, we had borrowed Ch$6,181,998 million from the FCIC or 8.7% of our total liabilities and had no outstanding LCL loans.

 

Our obligation to the Central Bank under the FCIC program is due during 2024. With the purpose of managing an orderly process of the expiration of the FCIC, in November 2022 the Central Bank established a collateral replacement program with the goal of reducing the pledged credit portfolio by replacing it with eligible Central Bank instruments at a rate of 1/18 per month. Additionally, with the same objective, the Central Bank agreed to implement a program for issuing Liquidity Deposits (LD) aimed exclusively at guaranteeing and providing operational support for the payment of the FCIC. These instruments will be issued at floating MPR with the same payment dates of the various FCIC facilities.

 

Liquidity risk 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 ALCO now uses as its 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, 2023, and 2022, the breakdown of the Bank’s liquid assets by levels was the following:

 

   December 31,
2023
   December 31,
2022
 
   (Ch$ million) 
Balance as of:        
Cash and cash equivalent   1,969,547    1,453,265 
Level 1 liquid assets(1)   6,072,282    5,424,452 
Level 2 liquid assets(2)   6,240    8,066 
Total liquid assets   8,048,069    6,885,783 

 

(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. Collateral under the FCIC funding program with the Central Bank of Chile and technical reserves in the Central Bank are not included.

 

(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.

 

160

 

 

   December 31,
2023
   December 31,
2022
 
   (Ch$ million)   (Ch$ million) 
Average balance as of:        
Cash and cash equivalent   1,328,956    1,237,652 
Level 1 liquid assets(1)   5,275,734    3,957,449 
Level 2 liquid assets(2)   7,001    8,785 
Total liquid assets   6,611,690    5,203,887 

 

(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. Collateral under the FCIC funding program with the Central Bank of Chile and technical reserve in the Central Bank are not included.

 

(2)Includes instruments issued by governments, central banks and development banks of foreign countries with a risk rating of A- to AA+ in accordance with international rating agencies and mortgage bonds issued by Chilean banks that are acceptable at the Central Bank’s repo window.

 

The Central Bank and our ALCO also requires us to comply with the following liquidity limits:

 

Liquidity coverage ratio (LCR), which measures the percentage of Liquid Assets over Net Cash Outflows. As of April 2019, Chilean banks began reporting their local LCR figures with a minimum level of 60% in 2020, 80% in 2021 and 100% in 2022. As of December 31, 2023, this indicator for Banco Santander Chile was 212%.

 

Net Stable Funding Ratio (NSFR) which measures a bank’s stable funding sources over required stable needs. Beginning in 2022, Chilean banks must have a minimum NSFR ratio of 60% with a gradual phase-in which will reach 100% by 2026. As of December 31, 2023, this indicator for Banco Santander Chile was 106% in compliance with the local regulatory limit.

 

The sum of the liabilities with a maturity of less than 30 days may not exceed the sum of the assets with a maturity of less than 30 days by an amount greater than our capital. This limit must be calculated in local currency and foreign currencies together as one gap. At December 31, 2023, the percentage of (i) our liabilities with a maturity of less than 30 days in excess of our assets with a maturity of less than 30 days to (ii) our capital and reserves was 40%, thus resulting in our compliance.

 

The sum of the liabilities in foreign currency with a maturity of less than 30 days may not exceed the sum of the assets in foreign currency with a maturity of less than 30 days by more than an amount greater than our capital. At December 31, 2023 the liabilities with a maturity of less than 30 days in foreign currency were less than our assets in foreign currency with a maturity of less than 30 days, thus resulting in our compliance.

 

The sum of the liabilities with a maturity of less than 90 days may not exceed the sum of the assets with a maturity of less than 90 days by more than 2 times our capital. This limit must be calculated in local currency and foreign currencies together as one gap. At December 31, 2023 the percentage of (i) our liabilities with a maturity of less than 90 days in excess of our assets with a maturity of less than 90 days to (ii) two times our capital and reserves was 39%, thus resulting in our compliance.

 

161

 

 

Market risk management

 

The Bank’s internal management of market risk is based chiefly on the procedures and standards of Santander Spain, which are in turn based on analysis of management in three principal components:

 

trading portfolio;

 

local financial management portfolio; and

 

foreign financial management portfolio.

 

The trading portfolio is comprised chiefly of investments valued at fair market value and free of any restriction on their immediate sale, which are often bought and sold by the Bank with the intention of selling them in the short term to benefit from short–term price fluctuations. The trading portfolio also includes the Bank’s exposure to foreign currency. The financial management portfolios include all the financial investments not considered to be part of trading portfolio.

 

Market risk – management of trading portfolio

 

The Bank applies VaR methodologies to measure the market risk of its trading portfolio. The Bank has a consolidated commercial position comprised of fixed–income investments and foreign currency trading. This portfolio is comprised mostly of Central Bank of Chile bonds, mortgage bonds, locally issued, low–risk corporate bonds and foreign currencies, mainly U.S. dollars. At the end of each year, the trading portfolio included no stock portfolio investments.

 

For the Bank, the VaR estimate is made under the historical simulation methodology, which consists of observing the behavior of the profits and losses that would have occurred in the current portfolio if the market conditions for a given historical period had been in force, in order to infer the maximum loss on the basis of that information, with a given degree of confidence. The methodology has the advantage of precisely reflecting the historical distribution of the market variables and not requiring any assumptions regarding the distribution of specific probabilities. All the VaR measures are intended to determine the distribution function for a change in the value of a given portfolio, and once that distribution is known, to calculate the percentile related to the necessary degree of confidence, which will be equal to the value at risk by virtue of those parameters. As calculated by the Bank, the VaR is an estimate of the maximum expected loss of market value for a given portfolio over a 1–day horizon, with a 99.00% confidence level. It is the maximum 1–day loss that the Bank could expect to experience in a given portfolio, with a 99.00% confidence level. In other words, it is the loss that the Bank would expect to experience only 1.0% of the time. The VaR provides a single estimate of market risk which is not comparable from one market risk to another. Returns are calculated through the use of a 2–year time window or at least 520 data points obtained since the last reference date for calculation of the VaR going backward in time.

 

We do not calculate three separate VaRs. We calculate a single VaR for the entire trading portfolio, which in addition is segregated by risk type. The VaR software performs a historical simulation and calculates a Profit and Loss Statement (P&L) for 520 data points (days) for each risk factor (fixed income, foreign currency and variable income.) The P&L of each risk factor is added and a consolidated VaR is calculated with 520 points or days of data. At the same time a VaR is calculated for each risk factor based on the individual P&L calculated for each individual risk factor. Furthermore, a weighted VaR is calculated in the manner described above, but which gives a greater weighting to the 30 most recent data points. The larger of the two VaRs is the one that is reported. In 2022, 2021 and 2020, we used the same VaR model and there has been no change in methodology or assumptions for subsequent periods.

 

The Bank uses the VaR estimates to provide a warning when the statistically estimated incurred losses in its trading portfolio would exceed prudent levels, and hence, there are certain predetermined limits.

 

Limitations of the VaR model

 

When applying a calculation methodology, no assumptions are made regarding the probability distribution of the changes in the risk factors; the historically observed changes are used for the risk factors on which each position in the portfolio will be valued.

 

It is necessary to define a valuation function fj(xi) for each instrument j, preferably the same one used to calculate the market value and income of the daily position. This valuation function will be applied in each scenario to generate simulated prices for all the instruments in each scenario.

 

162

 

 

In addition, the VaR methodology is subject to the following limitations:

 

Changes in market rates and prices may not be independent and identically distributed random variables, and may not have a normal distribution; in particular, the assumption of normal distribution may underestimate the probability of extreme market movements;

 

The historical data used by the Bank may not provide the best estimate of the joint distribution of changes in the risk factors in the future, and any modification of the data may be inadequate; In particular, the use of historical data may fail to capture the risk of potential extreme and adverse market fluctuations, regardless of the time period used;

 

A 1–day time horizon may not fully capture the market risk positions which cannot be liquidated or covered in a single day; it would not be possible to liquidate or cover all the positions in a single day;

 

The VaR is calculated at the close of business, but trading positions may change substantially in the course of the trading day;

 

The use of a 99% degree of confidence does not take account of, or make any statement about, the losses that could occur outside of that degree of confidence; and

 

A model such as the VaR does not capture all the complex effects of the risk factors over the value of the positions or portfolios, and accordingly, it could underestimate potential losses.

 

We perform back-testing daily and generally find that trading losses exceed our VaR estimate approximately one out of every 100 trading days. At the same time, we set a limit to the maximum VaR that we are willing to accept over our trading portfolio. We perform back-testing daily and generally find that trading losses exceed our VaR estimate approximately one out of every 100 trading days. At the same time, we set a limit to the maximum VaR that we are willing to accept over our trading portfolio. Also, a maximum VaR limit was established that can be applied over the trading portfolio. The average VaR as of December 31, 2023 was U.S.$4.09 million, which is below the total limit. The high, low, and average levels for each component and each year below were as follows:

 

Consolidated  2023   2022   2021 
   (in millions of U.S.$) 
VaR            
High   6.81    6.23    3.43 
Low   2.61    2.73    1.11 
Average   4.09    4.41    1.96 
                
Fixed-income investments               
High   5.06    5.78    2.86 
Low   2.11    2.75    1.12 
Average   3.15    4.20    1.86 
                
Variable-income investments               
High           0.29 
Low            
Average           0.19 
                
Foreign currency investments               
High   5.79    4.82    2.33 
Low   0.23    0.17    0.09 
Average   2.20    1.14    0.77 

 

Market risk – local and foreign financial management

 

The Bank’s financial management portfolio includes most of the Bank’s non-trading assets and liabilities, including the credit/loan portfolio. For these portfolios, investment and financing decisions are strongly influenced by the Bank’s commercial strategies.

 

163

 

 

The Bank uses a sensitivity analysis to measure the market risk of local and foreign currencies (not included in the trading portfolio). The Bank performs a simulation of scenarios, which will be calculated as the difference between the present value of the flows in the chosen scenario and their value in the base scenario. In 2021 and 2022, the ALCO set a curve with a parallel movement of 25 bps. In 2023, the ALCO set a curve with a parallel movement of 100 bps. All the positions in local currency, including the one indexed to inflation (UF), and also the positions in foreign currency are added together based on a historical correlation model existing between the currencies. The Bank has also established limits regarding the maximum loss that these types of movements in interest rates may have on capital and net financial income budgeted for the year.

 

Limitations of the sensitivity models

 

The most important assumption is using an exchange rate of 100bp in 2023 and 25 bps in 2022 and 2021 based on the yield curve. In 2021 and 2022, the Bank used a 25 bps exchange rate since sudden changes of this magnitude were considered more realistic. In 2023 and prior to 2021, a model was used that considered a change of 100 basis points in the yield curve (57 basis points for real rates). Santander Spain Global Risk Department has also established comparable limits by country, to be able to compare, monitor and consolidate market risk by country in a realistic and orderly way.

 

In addition, the sensitivity simulation methodology should be interpreted taking into consideration the following limitations:

 

The simulation of scenarios assumes that the volumes remain consistent in the Bank’s Consolidated Statements of Financial Position and are always renewed at maturity, also including certain credit risk and prepayment considerations that may affect the maturity of certain positions.

 

This model assumes an identical change along the entire length of the yield curve and does not take into account the different movements for different maturities.

 

The model does not take into account the sensitivity of volumes which results from interest rate changes.

 

The limits to losses of budgeted financial income are calculated based on the financial income foreseen for the year, which may not be actually earned, meaning that the real percentage of financial income at risk may be higher than the expected one.

 

Market Risk – Financial management portfolio – December 31, 2023, 2022 and 2021:

 

   2023   2022   2021 
   Effect on
net interest
income
   Effect on
equity
   Effect on
net interest
income
   Effect on
equity
   Effect on
net interest
income
   Effect on
equity
 
Financial management portfolio – local currency (in millions of Ch$)                        
Loss limit   124,904    353,718    33,550    95,710    32,865    84,864 
High   79,657    173,389    23,982    57,176    31,233    80,097 
Low   41,151    88,382    15,459    39,957    13,694    41,653 
Average   62,740    133,464    21,366    49,580    24,018    62,916 
                               
Financial management portfolio – foreign currency (in millions of U.S.$)                              
Loss limit   157    175    38    43    37    35 
High   18    92    10    33    9    32 
Low   0    53    0    20    1    1 
Average   10    70    3    26    4    18 
                               
Financial management portfolio – consolidated (in millions of Ch$)                              
Loss limit   124,904    353,718    33,550    95,710    32,865    84,864 
High   75,816    283,550    28,699    76,738    25,709    78,259 
Low   34,663    246,664    16,515    66,098    12,854    56,857 
Average   64,477    268,776    23,438    71,003    21,041    69,577 

 

164

 

 

Market risk –Regulatory method

 

The following table illustrates our market risk exposure according to the Chilean regulatory method, as of December 31, 2023. During 2022, the FMC issued a new regulation on the measurement and control of interest rate risk of the banking book and inflation risk, which will come into force in April 2023. According to such new regulation, the short-term exposure to interest rate risk and inflation risk as a percentage of net interest and inflation income and net fee income sensitive to interest rates, accumulated in the last 12 months, should not exceed a limit established by the Bank’s Board. The Board set a limit equal to 55% of net income from interest and inflation and net income from fees sensitive to interest rates. Furthermore, long-term exposure to interest rates for the banking book as a percentage of regulatory capital should not exceed a limit established by the Bank’s Board. The Board set this limit at 35% of the Bank’s regulatory capital. Nonetheless, the FMC can lower limits at their discretion as part of its supervisory authority over the risk management of the Bank.

 

   As of Dec.31, 
   2023 
   Ch$mn 
Market risk – short-term financial management portfolio     
Short Term Exposure to Interest Rate Risk   97,410 
Exposure to Inflation Risk   161,222 
Short-term exposure of financial management portfolio   258,632 
Limit = 55% net (net income from interest and inflation+ interest rates sensitive commissions)   575,483 
Available margin   316,851 
Market risk – long-term financial management portfolio     
Long Term Exposure to Interest Rate Risk   1,057,637 
Limit = 35% Regulatory capital   2,442,556 
Available margin   1,384,919 
Trading book     
Exposure to rate risk   371,203 
Exposure to currency risk   9,130 
Interest rate option risk   - 
Currency option risk   3,167 
Total exposure of trading portfolio   383,500 
Banking book     
Short Term Exposure to Interest Rate Risk   97,410 
Exposure to Inflation Risk   161,222 
Long Term Exposure to Interest Rate Risk   1,057,637 
Total exposure of banking book   1,316,269 

 

165

 

 

Derivative activities

 

At December 31, 2023, 2022 and 2021, derivatives are valued at market price on the balance sheet and the net unrealized gain (loss) on derivatives is classified as a separate line item on the income statement. Notional amounts are not recorded on the balance sheet. Banks must mark-to-market derivatives. A derivative financial instrument held for trading purposes must be marked to market and the unrealized gain or loss recognized in the income statement. The FMC recognizes three kinds of hedge accounting: (i) cash flow hedges, (ii) fair value hedges and (iii) hedging of foreign investments.

 

When a cash flow hedge exists, the fair value movements on the part of the hedging instrument that is effective are recognized in equity. Any ineffective portion of the fair value movement on the hedging instrument is recognized in the income statement.

 

When a fair value hedge exists, the fair value movements on the hedging instrument and the corresponding fair value movements on the hedged item are recognized in the income statement. Hedged items in the balance sheet are presented at their market value.

 

When a hedge of foreign investment exposure exists (i.e. investment in a foreign branch), the fair value movements on the part of the hedging instrument that is effective are recognized in equity. Any ineffective portion of the fair value movement on the hedging instrument is recognized in the income statement.

 

In order to reduce the credit risk in its derivative contracts, the Bank has entered into Credit Support Annex (CSA) agreements with the majority of its counterparties, which include obligations to post daily cash collateral. The majority of the agreements include an obligation to post collateral with a threshold amount of zero. In the table below we identify those contracts with CSA and breakdown the fair value of our derivative portfolio by collateral threshold requirements for 2023 and 2022.

 

   Fair value of derivative contracts 
   2023   2022 
   Assets   Liabilities   Assets   Liabilities 
Derivative contracts with zero threshold collateral amount in CSA   9,802,491    10,836,243    8,177,074    9,588,768 
Derivative contracts with threshold collateral amounts in CSA that are greater than zero   773,325    895,894    440,091    536,318 
Derivative contracts without CSA agreements   149,199    256,205    3,533,557    3,983,028 
Total   10,725,015    11,988,342    12,150,722    14,108,114 

 

We classify some of our derivative financial instruments as being financial assets held for trading, due to the guidelines from the FMC. We enter into derivative contracts with some clients who seek hedging instruments. However, substantially all of our derivatives are not actually used for speculative purposes or trading.

 

166

 

 

As of December 31, 2023, the Bank held the following portfolios of financial assets and liabilities derivative contracts for trading at fair value through profit and loss:

 

   As of December 31, 2023 
   Notional amount 
   Demand   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   Fair value 
   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn 
Assets                                    
Currency forward       15,867,609    12,888,002    14,222,043    4,911,114    684,394    1,086,568    49,659,730    1,262,688 
Interest rate swaps       5,619,676    18,456,733    20,257,077    18,590,489    7,833,406    14,063,652    84,821,033    2,342,464 
Cross currency swaps       1,960,833    4,433,903    17,189,757    41,659,348    18,501,221    44,664,446    128,409,508    6,505,587 
Call currency options       44,358    100,886    84,331                229,575    4,100 
Put currency options       212,940    114,990    54,949    6,558            389,437    4,647 
Total       23,705,416    35,994,514    51,808,157    65,167,509    27,019,021    59,814,666    263,509,283    10,119,486 

 

   As of December 31, 2023 
   Notional amount 
   On Demand   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   Fair value 
   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn 
Liabilities                                    
Currency forward       15,424,586    11,104,328    15,247,865    3,947,215    1,408,304    2,072,624    49,204,922    1,258,352 
Interest rate swaps       5,149,926    15,399,286    19,835,190    18,565,396    7,666,659    11,349,882    77,966,339    1,940,320 
Cross currency swaps       1,915,707    4,813,848    22,440,782    48,295,676    20,620,952    44,005,979    142,092,944    6,314,963 
Call currency options       192,051    81,368    10,799                284,218    2,726 
Put currency options       6,518    147,329    157,779    36,650            348,276    5,214 
Total       22,688,788    31,546,159    57,692,415    70,844,937    29,695,915    57,428,485    269,896,699    9,521,575 

 

As of December 31, 2022, the Bank holds the following the Bank holds the following portfolios of financial assets and liabilities derivative contracts for trading at fair value through profit and loss:

 

   As of December 31, 2022 
   Notional amount 
   Demand   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   Fair value 
   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn 
Assets                                    
Currency forward       9,245,832    7,653,539    9,828,036    6,178,376    1,009,395    737,202    34,652,380    1,669,807 
Interest rate swaps       5,583,353    8,796,596    26,246,111    24,855,247    11,658,182    16,373,617    93,513,106    4,283,817 
Cross currency swaps       1,258,796    1,575,109    5,398,185    19,811,336    11,689,202    21,297,126    61,029,754    5,708,306 
Call currency options       99,157    80,844    24,744                204,745    1,429 
Put currency options       309,713    1,699    7,816                319,228    9,601 
Total       16,496,851    18,107,787    41,504,892    50,844,959    24,356,779    38,407,945    189,719,213    11,672,960 

 

167

 

 

   As of December 31, 2022 
   Notional amount 
   On Demand   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   Fair value 
   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn 
Liabilities                                    
Currency forward       10,130,103    7,474,471    10,559,457    4,725,547    1,913,113    2,034,929    36,837,620    1,818,024 
Interest rate swaps       4,042,822    9,226,258    26,018,228    25,470,384    11,344,275    15,274,620    91,376,587    3,935,401 
Cross currency swaps       726,140    1,580,644    5,192,387    18,051,948    10,879,098    20,229,246    56,659,463    5,561,634 
Call currency options       289,795    70,941    10,365                371,101    2,794 
Put currency options       68,099    11,304    27,612                107,015    1,467 
Total       15,256,959    18,363,618    41,808,049    48,247,879    24,136,486    37,538,795    185,351,786    11,319,320 

 

We also use derivatives to hedge our exposure to foreign exchange, interest rate and inflation risks. The Bank uses derivatives, mainly Ch$/UF swaps, in order to cover its exposure to inflation due to a higher amount of assets linked to inflation as compared to liabilities. Such derivatives are accounted for as cash flow hedges. 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. To maintain this position, the Bank enters into interest rate swaps that are accounted for as fair value hedges.

 

As of December 31, 2023 and 2022 the Bank holds the following portfolio of derivative instruments for hedging purposes:

 

   As of December 31, 2023             
   Notional amount       Fair value 
   Demand   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   Assets   Liabilities 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Fair value hedge derivatives                                        
Interest rate swaps       12,562    3,656,708    2,971,608    2,219,138    349,780    612,115    9,821,911    96,729    1,319,275 
Cross currency swaps       87,445    216,904    902,332    4,075,196    497,502    1,764,227    7,543,606    251,810    174,041 
Subtotal       100,007    3,873,612    3,873,940    6,294,334    847,282    2,376,342    17,365,517    348,539    1,493,316 
                                                   
Currency forwards       43,242    177,000    2,207,656    8,745            2,436,643    5,539    64,624 
Cross currency swaps       459,517    1,144,579    5,286,020    6,210,538    1,205,343    1,676,266    15,982,263    251,451    908,827 
Subtotal       502,759    1,321,579    7,493,676    6,219,283    1,205,343    1,676,266    18,418,906    256,990    973,451 
Total       602,766    5,195,191    11,367,616    12,513,617    2,052,625    4,052,608    35,784,423    605,529    2,466,767 

 

   As of December 31, 2022             
   Notional amount       Fair value 
   Demand   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   Assets   Liabilities 
   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn   Ch$mn 
Fair value hedge derivatives                                        
Interest rate swaps       206,630    447,773    722,845    7,300,878    608,013    1,728,916    11,015,055    213,478    1,166,339 
Cross currency swaps       84,959    706,859    1,512,048    3,149,733    1,200,889    1,462,413    8,116,901    75,848    333,097 
Subtotal       291,589    1,154,632    2,234,893    10,450,611    1,808,902    3,191,329    19,131,956    289,326    1,499,436 
Cash flow hedge derivatives                                                  
Currency forwards       176,664    1,839,766    554,696                2,571,126    823    35,332 
Cross currency swaps       486,032    932,204    2,019,072    6,703,372    2,077,260    2,261,958    14,479,898    187,613    1,254,026 
Subtotal       662,696    2,771,970    2,573,768    6,703,372    2,077,260    2,261,958    17,051,024    188,436    1,289,358 
Total       954,285    3,926,602    4,808,661    17,153,983    3,886,162    5,453,287    36,182,980    477,762    2,788,794 

 

168

 

 

ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

 

A. Debt Securities

 

Not applicable.

 

B. Warrants and Right

 

Not applicable.

 

C. Other Securities

 

Not applicable.

 

D. American Depositary Shares

 

Our Depositary is The Bank of New York Mellon, with its principal executive office located at 240 Greenwich Street, New York, N.Y. 10286.

 

Each ADS represents the right to receive 400 shares of Common Stock without par value.

 

Persons depositing or withdrawing shares or ADS holders must pay:
$5.00 (or less) per 100 ADSs   Issuance of ADSs, including issuances resulting from a distribution of shares or rights or other property Cancellation of ADSs for the purpose of withdrawal, including if the Deposit Agreement terminates
     
$.05 (or less) per ADS (or a portion thereof)   Any cash distribution to ADS holders
A fee equivalent to the fee that would be payable if securities distributed to you had been deposited with the Depositary   Distribution of securities distributed to holders of deposited securities (including rights) that are distributed by the Depositary to ADS holders
     
$.05 (or less) per ADS (or a portion thereof) per calendar year   Depositary services
Registration and transfer fees   Transfer and registration of shares on our share register to or from the name of the Depositary or its agent when you deposit or withdraw shares
Expenses of the Depositary   Cable (including SWIFT), telex and facsimile transmissions (when expressly provided in the Deposit Agreement)

Converting foreign currency to U.S. dollars
Taxes and other governmental charges the Depositary or the custodian has to pay on any ADSs or shares underlying ADSs, such as stock transfer taxes, stamp duty or withholding taxes   As necessary
Any other charges incurred by the Depositary or its agents for servicing the shares or other deposited securities   As necessary

 

The Depositary may collect any of its fees by deducting those fees from any cash distributions payable to owners, or by selling a portion of distributable property to pay the fees. The Depositary may also collect its annual fee for Depositary services and its fees for any other charges incurred by deducting those fees from any cash distributions or by directly billing ADS holders.

 

169

 

 

The Depositary may convert currency itself or through any of its affiliates and, in those cases, acts as principal for its own account and not as agent, advisor, broker or fiduciary on behalf of any other person and earns revenue, including, without limitation, transaction spreads, that it will retain for its own account. The revenue is based on, among other things, the difference between the exchange rate assigned to the currency conversion made under the Deposit Agreement and the rate that the Depositary or its affiliate receives when buying or selling foreign currency for its own account. The Depositary makes no representation that the exchange rate used or obtained in any currency conversion under the Deposit Agreement will be the most favorable rate that could be obtained at the time or that the method by which that rate will be determined will be the most favorable to ADS holders, subject to the Depositary’s obligations under the Deposit Agreement. The methodology used to determine exchange rates used in currency conversions is available upon request.

 

In performing its duties under the Deposit Agreement, the Depositary may use brokers, dealers, foreign currency dealers or other service providers that are owned by or affiliated with the Depositary and that may earn or share fees, spreads or commissions.

 

Direct and Indirect Payments

 

The Depositary has agreed to make payments to us to reimburse us for costs and expenses generally arising out of establishment and maintenance of the ADS program, waive fees and expenses for services provided to us by the Depositary or share revenue from the fees collected from ADS holders from time to time. Under certain circumstances, including termination of the program, we are required to repay the Depositary amounts reimbursed in prior periods.

 

The reimbursements include direct payments (legal and accounting fees incurred in connection with preparation of Form 20-F and ongoing SEC compliance and listing requirements, listing fees, investor relations expenses, advertising and public relations expenses and fees payable to service providers for the distribution of hard copy materials to beneficial ADR holders in the Depositary Trust Company, such as information related to shareholders’ meetings and related voting instruction cards); and indirect payments (third-party expenses paid directly and fees waived).

 

In 2023, the Depositary made direct payments and reimbursements to us in the gross amount of U.S.$1,339,387 for expenses related to investor relations of which 30% was withheld for tax purposes in the U.S.

 

170

 

 

PART II

 

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

 

Not applicable.

 

ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

 

Not applicable.

 

ITEM 15. CONTROLS AND PROCEDURES

 

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

 

As of December 31, 2023, the Bank, under the supervision and with the participation of the Bank’s management, including its Disclosure Committee, the Chief Executive Officer, the Chief Financial Officer and the Chief Accounting Officer, performed an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). There are, as described below, inherent limitations to the effectiveness of any control system, including disclosure controls and procedures. Accordingly, even effective disclosure controls and procedures can provide only reasonable assurance of achieving their control objectives.

 

Based on such evaluation, as of December 31, 2023, the Bank’s Disclosure Committee, the Chief Executive Officer, the Chief Financial Officer and the Chief Accounting Officer concluded that the Bank’s disclosure controls and procedures were effective in ensuring that information relating to the Bank, including its consolidated subsidiaries, required to be disclosed in the reports it files under the Exchange Act is (1) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (2) accumulated and communicated to the Bank’s management, including its Disclosure Committee and principal financial officers as appropriate to allow timely decisions regarding required disclosure.

 

Management’s Report on Internal Control Over Financial Reporting

 

The Bank’s management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Exchange Act. The Bank’s internal control over financial reporting is a process designed by, or under the supervision of, the Bank’s principal executive and principal financial officers and effected by the Bank’s Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with IFRS-IASB and includes those policies and procedures that:

 

Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Bank;

 

Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with IFRS-IASB, and that our receipts and expenditures are being made only in accordance with authorizations of the Bank’s management and directors; and

 

Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

 

Because of its inherent limitations, internal control over financial reporting, no matter how well designed may not prevent or detect misstatements, due to the possibility that a control can be circumvented or overridden or that misstatements due to error or fraud may occur that are not detected. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

171

 

 

We have adapted our internal control over financial reporting to international standards and comply with the guidelines set by the Committee of Sponsoring Organizations of the Treadway Commission in its Internal Control—Integrated Framework (2013). The general framework assigns to management specific responsibilities regarding the structure and effectiveness of the processes related directly and indirectly with the production of consolidated financial statements, as well as the controls needed to mitigate the risks inherent in these processes.

 

Under the supervision and with the participation of the Bank’s management, including the Disclosure Committee, the Chief Executive Officer, the Chief Financial Officer and the Chief Accounting Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).

 

Based on this assessment, our management concluded that, as of December 31, 2023, our internal control over financial reporting was effective based on those criteria.

 

Changes in Internal Control Over Financial Reporting

 

There has been no change in the Bank’s internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that occurred during the period covered by this Annual Report that has materially affected, or is reasonably likely to materially affect, internal control over financial reporting.

 

Our internal control over financial reporting as of December 31, 2023 has been audited by an independent registered public accounting firm, as stated in its report, which is referenced below.

 

Report of Independent Registered Public Accounting Firm

 

For the report of PricewaterhouseCoopers Consultores, Auditores y Compañía Limitada, independent registered public accounting firm, dated February 22, 2023, on the effectiveness of our internal control over financial reporting as of December 31, 2023, see page F-3 of our Audited Consolidated Financial Statements.

 

ITEM 16. [RESERVED]

 

ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT

 

Our Board of Directors determined that one of the members of our Audit Committee, Rodrigo Vergara, met the requirements of an “audit committee financial expert” in accordance with SEC rules and regulations, in that he has an understanding of IFRS-IASB and financial statements, the ability to assess the general application of IFRS-IASB in connection with the accounting for estimates, accruals and reserves, experience analyzing and evaluating financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by our consolidated financial statements, an understanding of internal controls over financial reporting, and an understanding of audit committee functions. All three members of our Audit Committee have experience overseeing and assessing the performance of Santander-Chile and its consolidated subsidiaries and our external auditors with respect to the preparation, auditing and evaluation of our consolidated financial statements.

 

All three members of our Audit Committee are considered to be independent according to applicable NYSE criteria.

 

ITEM 16B. CODE OF ETHICS

 

The Bank has adopted a code of ethics that is applicable to all of the Bank’s employees and a copy is included as an exhibit hereto. We will provide to any person without charge, upon request, a copy of our code of ethics. Please email irelations@santander.cl to request a copy. Our code of ethics is available on our website, which does not form part of this Annual Report on Form 20-F, at www.santander.cl under the heading “Información Corporativa.

 

172

 

 

ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES

 

Amounts billed by the auditors for statutory audit and other services were as follows:

 

   2023   2022 
   (in millions of Ch$) 
Audit Fees:        
Statutory audit   847    808 
Audit-related regulatory reporting   424    396 
Other audit-related fees   24    23 
Tax Fees:          
Compliance   -    - 
Advisory Services   -      
Total   1,295    1,227 

 

Statutory audit: Consists of fees billed for professional services rendered in connection with the audit of our consolidated financial statements that are provided by PricewaterhouseCoopers Consultores, Auditores y Compañía Limitada (PCAOB ID: 1364) in 2021 and 2020 in connection with statutory and regulatory filings or engagements, and attest services.

 

Audit-related regulatory reporting: Consists of fees billed for assurance and related services that were specifically related to the performance of the audit and review of our filings under the Securities Act.

 

Tax fees: Consist of fees billed for related services that were specifically related to tax related matters such as assuring the Bank was in compliance with tax laws and other tax advisory services.

 

The Audit Committee is required to pre-approve the audit and non-audit services performed by the Bank auditors in order to assure that the provision of such services do not impair the audit firm’s independence.

 

In the first months of each year the Audit Committee proposes to the Board the appointment of the independent auditor. As a matter of policy, at that time, the Audit Committee pre-approves the audit and audit related services that the appointed auditors will be required to carry out during the year to comply with the applicable regulation. These services will be included in the corresponding audit contracts of the Bank with its principal auditing firm.

 

In addition, under such policy, non-recurring audit or audit-related services and all non-audit services provided by the Bank principal auditing firm or other auditing firms are subject to case-by-case approval by the Audit Committee.

 

The Chief Accounting Officer is in charge of managing the process and must report monthly to the Audit Committee detailing all services to be provided by auditors, and others requiring individual approval.

 

All services provided by the Bank principal auditing firm in 2021 detailed in the table above were approved by the Audit and Compliance Committee.

 

ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES

 

Not applicable.

 

ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

 

In 2023, neither Santander-Chile nor any of its affiliates purchased any of Santander-Chile’s equity securities.

 

ITEM 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT

 

Not applicable.

 

173

 

 

ITEM 16G. CORPORATE GOVERNANCE

 

Summary Comparison of Corporate Governance Standards and NYSE Listed Company Standards

 

Our corporate governance standards, dictated by Chilean corporate law, differ from the standards followed by U.S. companies under the New York Stock Exchange (NYSE) listing standards in a number of ways. Consequently, you will not have the same protections afforded to shareholders of companies that are subject to all NYSE corporate governance requirements. The following is a non-exhaustive summary of a few key differences:

 

Whether a company’s executive officers may serve as its directors – the NYSE standards do not prohibit a U.S. company’s executive officer from also serving as a director, whereas our corporate governance standards prohibit this.

 

Whether the shareholders must be given an opportunity to vote on equity-compensation plans – the NYSE standards require that shareholders be allowed to vote on all equity compensation plans of a U.S. company, whereas our corporate governance standards only require that shareholders be allowed to vote on director compensation.

 

The adoption and disclosure of corporate governance guidelines – the NYSE standards require all U.S. companies listed on the NYSE to adopt the NYSE corporate governance guidelines, whereas we follow the corporate governance guidelines established under Chilean law.

 

As more than 50% of our voting power is held by another company, Santander Spain, we would be permitted to elect for certain exemptions under NYSE corporate governance standards if we were a U.S. company. Specifically, as a U.S. company, we could elect to be exempted from the requirements (i) that we have a majority of independent directors (as defined by the NYSE), (ii) that we have a nominating/corporate governance committee meeting certain conditions, and (iii) that we have a compensation committee meeting certain requirements. Because we would not be required to follow these standards if we were a U.S. company, we have not summarized the differences, if any, between these provisions and our own corporate governance procedures.

 

Summary of Corporate Governance Standards

 

For a summary of our Board’s corporate governance practices please see “Item 6C—Board Practices” and “Item 10B—Memorandum and Articles of Association” which describe in detail the governing standards of the board committees. Santander-Chile has also adopted diverse measures to promote good corporate governance.

 

ITEM 16H. MINE SAFETY DISCLOSURE

 

Not applicable.

 

ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

 

Not applicable.

 

ITEM 16J. INSIDER TRADING POLICIES

 

Not applicable.

 

ITEM 16K. CYBERSECURITY

 

Cybersecurity Risk Management

 

Our operational risk management and control model is based on a continuous process of identifying, evaluating, and mitigating sources of risk, regardless of whether they have materialized or not. Throughout the application of this process, risk management priorities are established appropriately, and internal controls are defined and executed to manage and mitigate the risk across the organization. For example, the internal cyber-security model, which is a part of our operational risk management and control model and is based on best practices and international standards, is periodically evaluated for its maturity level.

 

174

 

 

With respect to operational risk management specifically, we have implemented tools such as Heracles, which is our management and reporting system for operational risk and which supports the operational risk program with a Governance, Risk and Compliance (GRC) approach. Heracles provides information for management and reporting at the Bank and throughout the Santander Group. Heracles also facilitates better operational risk management decisions by using a common set of taxonomies and methodological standards to allow information consolidation, duplication prevention, and reporting simplification.

 

We have also implemented a qualitative “Risk control self-assessment” (RCSA) process, that allows us to identify, assess and measure, in a dynamic and proactive way, the material operational risks that could prevent the business or support units from achieving their objectives, as well as the effectiveness of the controls linked to their mitigation. Our RCSA integrates specific reviews that allows us to identify cyber, technology, fraud, third party supplier and other risk drivers, that could lead to operational risks as well as the failure to meet regulatory expectations. In addition, RCSA incorporates reviews related to regulatory compliance, conduct and financial crime risk. In 2023, in light of an increase in cyber and environmental related risks as well as regulatory requirements (in particular, Digital Operational Resilience Act (DORA) - Regulation (EU) 2022/2554), the Group and its subsidiaries, including the Bank, have strengthened the supplier risk management model and the internal control framework. A new IT platform is being developed to properly assess and manage the risks in outsourcing and third-party agreements.

 

Other instruments are used to analyze and manage operational risk, such as the assessment of new products and services, and transformation initiatives; business continuity plans (BCP); review of corporate insurance; review of the management perimeter; recommendations from internal and external auditors, and supervisors; and the quality assurance process.

 

In 2023, the Santander Group, in general, and the Bank, specifically, have continued evolving their cyber defenses in line with the Cybersecurity Vision and key strategic initiatives. New controls were implemented following a cyber threat-led approach, covering current areas of risk and new attack methods. In addition to the evolution of our Ransomware readiness and Data Leakage Prevention frameworks, developed in 2022, a new Distributed Denial of Service framework has been designed, responding to the increased threat derived by the geopolitical backdrop. New controls have been developed, notably around supply chain, backup and recovery and fraud prevention measures reinforced by leveraging behavioral biometric solutions and machine learning technology.

 

There were other isolated events involving third-party service providers, which were promptly addressed and resolved. None of these events materially affected our operations. Our team remains vigilant and committed to enhancing our cybersecurity measures to protect against evolving digital threats.

 

Governance

 

The Bank has implemented a Cybersecurity Framework defines the governance, roles, responsibilities, and policies on preventing and confronting cybercrime. The Chief of Cybersecurity or CISO (Chief Information Security Officer) has been defined as the officer responsible for cybersecurity, embedded in the Bank’s Technology and Operations division, which is the front line of defense against cyber-security threats and data security. In addition, the Non-Financial Risk Department through Cyber Risk (a specialized area) independently controls and supervises the Cyber Security Risk. Our CISO has extensive experience in general management roles, IT project management, high performance team development and management, innovative solution portfolios and industry segments development. His career has included executive positions in IT companies such as IBM, SAP and Oracle and he has been Technology Risk Manager at Banco Santander Chile, in charge of Cybersecurity and Cyber Fraud for more than 8 years.

 

In turn, there is a group of supervisory bodies that include the Cybersecurity and Technology Risk Committee, who are responsible for ensuring adequate management of cybersecurity risks in line with business objectives and risk appetite; the Non-Financial Risk Committee, who is in charge of supervising and controlling the management of non-financial risks in order to prevent and mitigate operational losses. The Bank’s Board is involved in supervising cybersecurity matters in two instances: (i) First, the board of directors, which approves the cybersecurity framework, strategy and policies, and ensures that appropriate priority and resources are allocated to protect systems and information of the Bank, and (ii) the board’s Integral Risk Committee, which proposes the action framework and risk appetite for the Bank, and oversees risk management based on a comprehensive view of risks. Both the board and the board’s Integral Risk Committee discuss these matters on a quarterly basis and the CISO reports to the board on Santander Chile’s cybersecurity management, including the review of strategic indicators and objectives for the year, cyber incidents of the period (if any) and the status of vulnerabilities management.. We are strongly aligned with Santander Group’s headquarters, who sets the guidelines and main initiatives to develop in these areas, regarding strategy, best practices, and experience-sharing. 

 

All this architecture has been created with the aim of identifying cyber risks, the development of a culture and education in cybersecurity, the creation of cyber scenarios to anticipate potential threats, and the fulfillment of the regulatory framework set by the authorities. 

 

175

 

 

PART III

 

ITEM 17. FINANCIAL STATEMENTS

 

We have responded to Item 18 in lieu of this Item.

 

ITEM 18. FINANCIAL STATEMENTS

 

Reference is made to Item 19 for a list of all financial statements filed as part of this Annual Report.

 

ITEM 19. EXHIBITS

 

a) Index to Financial Statements

 

Report of PricewaterhouseCoopers Consultores, Auditores y Compañía Limitada, independent registered public accounting firm (PCAOB ID:1364)   F-2
Audited Consolidated Financial Statements    
Consolidated Statements of Financial Position as of December 31, 2023 and 2022   F-4
Consolidated Statements of Income for each of the three years in the period ended December 31, 2023, 2022 and 2021   F-5
Consolidated Statements of Comprehensive Income for each of the three years in the period ended December 31, 2023, 2022 and 2021   F-6
Consolidated Statements of Changes in Equity for each of the three years in the period ended December 31, 2023, 2022 and 2021   F-7
Consolidated Statements of Cash Flows for each of the three years in the period ended December 31, 2023, 2022 and 2021   F-9
Notes to consolidated financial statements   F-11

 

176

 

 

b) Index to Exhibits

 

Exhibit Number   Description
1A.1   Restated Articles of Incorporation of Santander-Chile (Spanish Version) (incorporated by reference to exhibit 3(a) to our Registration Statement on Form F-4 (Registration No. 333-100975) filed with the Commission on December 9, 2002).
1A.2   Restated Articles of Incorporation of Santander-Chile (English Version) (incorporated by reference to exhibit 3(b) to our Registration Statement on Form F-4 (Registration No. 333-100975) filed with the Commission on December 9, 2002).
1B   Amended and Restated By-Laws (estatutos) of Santander-Chile (English Version) (incorporated by reference to exhibit 99.1 to our Report on Form 6-K (File No. 001-14554) filed with the Commission on March 15, 2017).
2A.1   Form of Amended and Restated Deposit Agreement among Banco Santander-Chile, The Bank of New York Mellon (as depositary) and Owners and Holders of American Depositary Shares (incorporated by reference to our Registration Statement on Form F-6 (Registration No. 333-205890) filed with the Commission on July 27, 2015).
2A.2   English translation of the Foreign Investment Contract among Banco Santander Chile, JPMorgan Chase Bank, N.A. and the Central Bank of Chile relating to the foreign exchange treatment of an investment in ADSs (incorporated by reference to exhibit 2.A.2 to Banco Santander-Chile’s Annual Report on Form 20-F for the fiscal year ended December 31, 2015 (File No. 1-14554) filed with the Commission on May 2, 2016).
2A.3   English translation of the Assignment of Rights under the Foreign Investment Contract from JPMorgan Chase Bank, N.A. to The Bank of New York Mellon (incorporated by reference to exhibit 2.A.3 to Banco Santander-Chile’s Annual Report on Form 20-F for the fiscal year ended December 31, 2015 (File No. 1-14554) filed with the Commission on May 2, 2016).
2A.4   Copy of the Central Bank Chapter XXVI Regulations Related to the Acquisition of Shares in Chilean Corporations and the Issuance of Instrument on Foreign Stock Exchanges or under Other Terms and Conditions of Issue (accompanied by an English translation) (incorporated by reference to Banco Santander-Chile’s Annual Report on Form 20-F for the fiscal year ended December 31, 1996 (File No. 1-13448) filed in paper with the Commission on June 30, 1997).
2B.1   Agreement for the Issuance of Bonds dated November 26, 1996 between Old Santander-Chile and Banco Security (accompanied by an English translation) (incorporated by reference to Banco Santander-Chile’s Annual Report for the fiscal year ended December 31, 1996 (File No. 1-13448) filed in paper with the Commission on June 30, 1997).
2D   Description of Securities.
8.1   List of Subsidiaries.
12.1   Section 302 Certification by the Chief Executive Officer.
12.2   Section 302 Certification by the Chief Financial Officer.
12.3   Section 302 Certification by the Financial Controller.
13.1   Section 906 Certification.
97.1   Banco Santander Chile Financial Statement Compensation Recoupment Policy
101.INS   Inline XBRL Instance Document.
101.SCH   Inline XBRL Taxonomy Extension Schema Document.
101.CAL   Inline XBRL Taxonomy Extension Calculation LinkbaseDocument.
101.DEF   Inline XBRL Taxonomy Extension Definition LinkbaseDocument.
101.LAB   Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE   Inline XBRL Taxonomy Extension Presentation LinkbaseDocument.
104   Cover Page Interactive Data File (formatted as InlineXBRL and contained in Exhibit 101).

 

We will furnish to the Securities and Exchange Commission, upon request, copies of any unfiled instruments that define the rights of holders of long-term debt of Banco Santander-Chile.

 

177

 

 

SIGNATURES

 

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this Annual Report on its behalf.

 

  BANCO SANTANDER-CHILE
   
  By: /s/ Cristian Florence
    Name: Cristian Florence
    Title: General Counsel

 

Date: February 22, 2024

 

178

 

 

 

 

 

 

 

 

 

 

CONSOLIDATED FINANCIAL STATEMENTS 2023

 

 

Banco Santander-Chile

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CONTENT

 

Report of Independent Registered Public Accounting Firm F-2
   
Report of Independent Registered Public Accounting Firm (PCAOB ID 1364)  
     
Consolidated Financial Statements  
     
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION F-4
CONSOLIDATED STATEMENTS OF INCOME F-5
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME F-6
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY F-7
CONSOLIDATED STATEMENTS OF CASH FLOWS F-9
     
Notes to the Consolidated Financial Statements  
     
NOTE 01 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES F-11
NOTE 02 SIGNIFICANT EVENTS F-33
NOTE 03 REPORTING SEGMENTS F-35
NOTE 04 CASH AND CASH EQUIVALENTS F-39
NOTE 05 FINANCIAL ASSETS FOR TRADING AT FAIR FALUE THROUGH PROFIT AND LOSS F-40
NOTE 06 FINANCIAL ASSETS AT FAIR FALUE THROUGH OTHER COMPREHENSIVE INCOME F-42
NOTE 07 FINANCIAL DERIVATIVE CONTRACTS FOR HEDGE ACCOUNTING F-48
NOTE 08 FINANCIAL ASSETS AT AMORTISED COST F-54
NOTE 09 INVESTMENTS IN ASSOCIATES AND OTHER COMPANIES F-66
NOTE 10 INTANGIBLE ASSETS F-68
NOTE 11 FIXED ASSETS F-69
NOTE 12 RIGHT OF USE ASSETS AND OBLIGATION FOR LEASE CONTRACTS F-70
NOTE 13 CURRENT AND DEFERRED TAXES F-72
NOTE 14 OTHER ASSETS F-75
NOTE 15 NON CURRENT ASSETS AND DISPOSAL GROUPS FOR SALE F-76
NOTE 16 FINANCIAL LIABILITIES FOR TRADING AT FAIR VALUE THROUGH PROFIT OR LOSS F-77
NOTE 17 FINANCIAL LIABILITIES AT AMORTISED COST F-78
NOTE 18 REGULATORY CAPITAL FINANCIAL INSTRUMENTS F-87
NOTE 19 PROVISIONS AND CONTINGENT PROVISIONS F-89
NOTE 20 OTHER LIABILITIES F-91
NOTE 21 EQUITY F-92
NOTE 22 NON-CONTROLLING INTEREST F-96
NOTE 23 MATURITY OF ASSETS AND LIABILITIES F-99
NOTE 24 CONTINGENCIES AND COMMITMENTS F-101
NOTE 25 INTEREST INCOME AND EXPENSES F-102
NOTE 26 FEES AND COMMISSIONS F-103
NOTE 27 NET INCOME (EXPENSE) FROM FINANCIAL OPERATIONS F-107
NOTE 28 NET INCOME FROM NON-CURRENT ASSETS AND GROUPS AVAILABLE FOR SALE NOT ADMISSIBLE AS DISCONTINUED OPERATIONS F-108
NOTE 29 OTHER OPERATING INCOME AND EXPENSES F-109
NOTE 30 PERSONNEL SALARIES AND EXPENSES F-110
NOTE 31 ADMINISTRATIVE EXPENSES F-111
NOTE 32 DEPRECIATION, AMORTISATION, AND IMPAIRMENT F-112
NOTE 33 EXPECTED CREDIT LOSSES ALLOWANCE F-113
NOTE 34 TRANSACTIONS WITH RELATED PARTIES F-114
NOTE 35 PENSION PLANS F-121
NOTE 36 FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES F-124
NOTE 37 RISK MANAGEMENT F-134
NOTE 38 SUBSEQUENT EVENTS F-171

 

F-1

 

 

Report of Independent Registered Public Accounting Firm

 

 

 

Report of Independent Registered Public Accounting Firm

 

Santiago, February 20, 2024

To the Board of Directors and Shareholders of Banco Santander - Chile

 

Opinions on the Financial Statements and Internal Control over Financial Reporting

 

We have audited the accompanying consolidated statements of financial position of Banco Santander - Chile and its subsidiaries (the “Bank”) as of December 31, 2023 and 2022, and the related consolidated statements of income, comprehensive income, changes in equity and cash flows for each of the three years in the period ended December 31, 2023, including the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Bank’s internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

 

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Bank as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2023 in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board. Also in our opinion, the Bank maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023 based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

 

Basis for Opinions

 

The Bank’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control over Financial Reporting, appearing under Item 15. Our responsibility is to express opinions on the Bank’s consolidated financial statements and on the Bank’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Bank in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

 

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

 

Definition and Limitations of Internal Control over Financial Reporting

 

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

 

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

 

F-2

 

 

 

 

Santiago, February 20, 2024

Board of Directors and Shareholders of Banco Santander - Chile

 

Critical Audit Matters

 

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

 

Expected Credit Loss Allowance for Commercial, Mortgage and Consumer Loans – Collective Basis

 

As described in Notes 1 and 37 to the consolidated financial statements, management assesses the adequacy of the collective basis expected credit loss allowance for commercial, mortgage and consumer loans using expected credit loss models. As of December 31, 2023, the collective basis expected credit loss allowance was Ch$ 994,088 million on total commercial, mortgage and consumer loans of Ch$ 40,464,409 million. As described by management, the estimation of the collective basis expected credit loss allowance considers qualitative and quantitative information that may affect the changes in credit risk and the development of significant assumptions related to the probabilities of default and loss given default, related to forward looking information, multi-factor analysis such as type of portfolio or transaction and macroeconomic factors. Management assesses the adequacy of significant assumptions and the qualitative information used to determine the significant increase in credit risk since initial recognition, the internal rating and scoring policy, and the probabilities of default and loss given default.

 

The principal considerations for our determination that performing procedures relating to the collective basis expected credit loss allowance for commercial, mortgage and consumer loans is a critical audit matter are (i) the significant judgment by management in determining the collective basis expected credit loss allowance, which in turn led to a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating audit evidence obtained relating to the significant assumptions used in the determination of the probabilities of default and loss given default, related to forward looking information, multi-factor analysis such as type of portfolio or transaction, the internal rating and scoring policy, and macroeconomic factors; and (ii) the audit effort involved the use of professionals with specialized skill and knowledge.

 

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the expected credit loss allowance for commercial, mortgage and consumer loans estimation process, which included controls over the significant assumptions used in the estimation of the collective basis expected credit loss allowance, within the qualitative information. These procedures also included, among others, (i) testing management’s process for estimating the collective basis expected credit loss allowance for commercial, mortgage and consumer loans; (ii) testing the completeness, accuracy, and relevance of underlying data provided by management and used in the model and (iii) the involvement of professionals with specialized skill and knowledge to assist in testing management’s process for estimating the collective basis expected credit loss allowance for commercial, mortgage and consumer loans, including evaluating the appropriateness of the methodologies and models, testing data used in the estimate and evaluating the reasonableness of significant assumptions in determining the probabilities of default and loss given default, related to forward looking information, multi-factor analysis such as type of portfolio or transaction, the internal rating and scoring policy, and macroeconomic factors.

 

Santiago, Chile

February 20, 2024

 

/s/ PricewaterhouseCoopers Consultores, Auditores y Compañía Limitada

 

We have served as the Bank’s auditor since 2016.

 

F-3

Banco Santander-Chile and Subsidiaries
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
For the years ended,

 

      As of December 31, 
      2023   2022 
   Note  MCh$   MCh$ 
ASSETS           
Cash and deposits in banks  4   2,723,282    1,982,942 
Cash items in process of collection  4   812,524    843,816 
Financial assets for trading at fair value through profit and loss  5   10,217,794    11,827,006 
Financial derivative contracts      10,119,486    11,672,960 
Debt financial instruments      98,308    154,046 
Financial assets at fair value through other comprehensive income  6   4,641,282    6,023,039 
Debt financial instrument      4,536,025    5,880,733 
Other financial instruments      105,257    142,306 
Financial derivative contracts for hedge accounting  7   605,529    477,762 
Financial assets at amortised cost  8   47,838,790    42,443,725 
Debt financial instruments      8,176,895    4,867,591 
Interbank loans      68,438    32,990 
Loans and account receivable from customers      39,593,457    37,543,144 
Investments in associates and other companies  9   55,284    46,586 
Intangible assets  10   97,551    107,789 
Property, plant, and equipment  11   251,823    238,095 
Right of use assets  12   100,449    133,795 
Current taxes  13    93,604    36,514 
Deferred taxes  13   553,475    641,254 
Other assets  14   3,046,607    3,579,345 
Non-current assets and disposal groups for sale  15   51,445    40,358 
TOTAL ASSETS      71,089,439    68,422,026 
LIABILITIES             
Cash items in process of being cleared  4   775,082    746,872 
Financial liabilities for trading at fair value through profit and loss  16   9,521,575    11,319,320 
Financial derivative contracts      9,521,575    11,319,320 
Financial derivative contracts for accounting hedges  7   2,466,767    2,788,794 
Financial liabilities at amortised cost  17   48,622,169    43,704,024 
Deposits and other demand liabilities      13,537,826    14,086,226 
Time deposits and other time liabilities      16,137,942    12,978,790 
Obligations under repurchase agreements      282,584    315,355 
Interbank borrowings      10,366,499    8,864,765 
Issued debt instruments      8,001,045    7,165,893 
Other financial liabilities      296,273    292,995 
Lease liabilities  12   104,516    137,089 
Regulatory capital financial instruments  18   1,813,938    1,733,869 
Provisions  19   283,971    461,022 
Current taxes  13   257,336    148,680 
Deferred taxes  13   217,936    376,727 
Other liabilities  20   1,683,654    2,041,682 
TOTAL LIABILITIES      65,746,944    63,458,079 
EQUITY             
Attributable to the shareholders of the Bank:      5,217,760    4,854,383 
Capital  21   891,303    891,303 
Reserves      3,160,610    2,860,541 
Valuation adjustments  21   (5,242)   (167,147)
Others equity instruments issued other than capital  21   608,721    590,247 
Retained earnings      537,461    679,439 
Retained earnings from prior years      131,862    124,846 
Income for the year      579,427    792,276 
Minus: Provision for mandatory dividends  19   (148,921)   (237,683)
Non-controlling interest  22   124,735    109,564 
TOTAL EQUITY      5,342,495    4,963,947 
TOTAL LIABILITIES AND EQUITY      71,089,439    68,422,026 

 

The accompanying notes form integral part of these consolidated financial statements.

 

F-4

Banco Santander-Chile and Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME
For the years ended,

 

      December 31, 
      2023   2022   2021 
   Note  MCh$   MCh$   MCh$ 
OPERATING INCOME               
Interest income and inflation  25   4,403,991    4,086,656    2,904,520 
Interest expense and inflation  25   (3,310,942)   (2,516,544)   (1,109,746)
Net interest income      1,093,049    1,570,112    1,794,774 
Fee and commission income  26   848,513    729,063    595,181 
Fee and commission expense  26   (345,873)   (321,794)   (245,853)
Net fee and commission income      502,640    407,269    349,328 
Net income from financial operations:  27               
Net income/(expense) from financial assets and liabilities for trading      91,761    78,191    (28,602)
Net income from derecognising financial assets and liabilities at amortised cost and financial assets at fair value through other comprehensive income      (120,934)   (1,628)   22,199 
Net income from exchange, adjustment and hedge accounting of foreign exchange      331,628    140,615    125,431 
Net income from financial operations      302,455    217,178    119,028 
Income from investments in associates and other companies  9   8,763    10,310    (475)
Net income from non-current assets and groups available for sale not admissible as discontinued operations  28   13,154    8,518    2,297 
Other operating income  29   3,807    5,539    1,662 
TOTAL OPERATING INCOME      1,923,868    2,218,926    2,266,614 
Personnel salaries and expenses  30   (412,275)   (414,808)   (397,675)
Administrative expenses  31   (320,111)   (310,219)   (280,134)
Depreciation and amortisation  32   (143,762)   (129,993)   (122,055)
Impairment of non-financial assets  33   (1,912)   
-
    
-
 
Other operating expenses  29   (31,638)   (106,306)   (101,430)
TOTAL OPERATING EXPENSES      (909,698)   (961,326)   (901,294)
                   
NET OPERATING INCOME BEFORE CREDIT LOSSES      1,014,170    1,257,600    1,365,320 
Provisions for loan losses for interbank loans and account receivable from customers  33   (453,458)   (441,396)   (355,638)
Provisions for loan losses for contingent loans and others  33   24,363    (5,189)   (12,254)
Recovery of loans previously charged-off  33   107,069    90,577    76,999 
Provision for loan losses for other financial assets at amortised cost and financial assets at fair value through OCI  33   (759)   (486)   (335)
Provision for loan losses      (322,785)   (356,494)   (291,228)
NET OPERATING INCOME BEFORE INCOME TAX      691,385    901,106    1,074,092 
Income tax expense  13   (97,548)   (93,624)   (221,664)
Result of continuing operations      593,837    807,482    852,428 
Result of discontinued operations      
 
    
-
    
-
 
NET INCOME FOR THE YEAR      593,837    807,482    852,428 
Attributable to:                  
Shareholders of the Bank      579,427    792,276    842,467 
Non-controlling interest  22   14,410    15,206    9,961 
Earnings per share from continued operations attributable to shareholders of the Bank:                  
Basic earnings  21   3.075    4.204    4.471 
Diluted earnings  21   3.075    4.204    4.471 
Earnings per share attributable to shareholders of the Bank:                  
Basic earnings  21   3.075    4.204    4.471 
Diluted earnings  21   3.075    4.204    4.471 

 

The accompanying notes form integral part of these consolidated financial statements.

 

F-5

Banco Santander-Chile and Subsidiaries
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the years ended,

 

      December 31, 
      2023   2022   2021 
   Note  MCh$   MCh$   MCh$ 
NET INCOME FOR THE YEAR      593,837    807,482    852,428 
                   
Other comprehensive income that will not be reclassified to profit or loss                  
Equity instruments at fair value through other comprehensive income      2,151    (3)   (243)
Income tax related to the above      (581)   1    66 
                   
Total items that will not be reclassified to the income statements      1,570    (2)   (177)
                   

Other comprehensive income that will be reclassified to profit or loss

                  
Debt instruments at fair value through other comprehensive income  21   17,493    2,834    (214,835)
Cash flow hedge  21   203,254    254,743    (236,816)
Income tax related to the above      (59,602)   (70,895)   122,987 
                   
Total items that will be reclassified to the income statements      161,145    186,682    (328,664)
Other comprehensive income for the year, net of tax      162,715    186,680    (328,841)
TOTAL COMPREHENSIVE INCOME FOR THE YEAR      756,552    994,162    523,587 
                   
Attributable to:                  
Shareholders of the Bank      741,332    978,979    513,910 
Non-controlling interests  22   15,220    15,183    9,677 

 

The accompanying notes form integral part of these consolidated financial statements.

 

F-6

Banco Santander-Chile and Subsidiaries
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
For the years ended,

 

       RESERVES   VALUATION ADJUSTMENTS       RETAINED EARNINGS             
   Capital   Reserves and other retained earnings   Effects of merger of companies under common control   Fair value reserve   Cash flow hedge   Income tax effects   Other
Equity instruments
   Retained earnings of prior years   Income for the year   Provision for mandatory dividends   Total attributable to shareholders of the Bank   Non-controlling interest   Total Equity 
   $   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Equity as of December 31, 2020   891,303    2,345,804    (2,224)   101,696    (136,765)   9,776    -    27,171    547,614    (164,284)   3,620,091    84,683    3,704,774 
Distribution of income from previous period   -    -    -    -    -    -    -    547,614    (547,614)   -    -    -    - 
Equity as of January 1, 2021   891,303    2,345,804    (2,224)   101,696    (136,765)   9,776    -    574,785    -    (164,284)   3,620,091    84,683    3,704,774 
Increase/decrease capital and reserves   -    -    -    -    -    -    598,136    -    -    -    598,136    -    598,136 
Dividends distributions / withdrawals made   -    -    -    -    -    -    -    (310,468)   -    164,284    (146,184)   -    (146,184)
Transfer of retained earnings to reserves   -    206,979    -    -    
 
    -    -    (206,979)   -    -    -    -    - 
Provision for mandatory dividends   -    -    -    -    -    -    -    -    -    (252,740)   (252,740)   -    (252,740)
Subtotal   -    206,979    -    -    -    -    598,136    (517,447)   -    (88,456)   199,212    -    199,212 
Other comprehensive income   -    -    -    (214,689)   (236,816)   122,948    -    -    -    -    (328,557)   (284)   (328,841)
Result of continuous operations   -    -    -    -    -    -    -    -    842,467    -    842,467    9,961    852,428 
Result of discontinuous operations   -    -    -    -    -    -    -    -    -    -    -    -    - 
Subtotal   -    -    -    (214,689)   (236,816)   122,948    -    -    842,467    -    513,910    9,677    523,587 
Equity as of December 31, 2021   891,303    2,552,783    (2,224)   (112,993)   (373,581)   132,724    598,136    57,338    842,467    (252,740)   4,333,213    94,360    4,427,573 
Distribution of income from previous period   -    -    -    -    -    -    -    842,467    (842,467)   -    -    -    - 
Equity as of January 1, 2022   891,303    2,552,783    (2,224)   (112,993)   (373,581)   132,724    598,136    899,805    -    (252,740)   4,333,213    94,360    4,427,573 
Issued perpetual bonds and interest   -    -    -    -    -    -    (7,889)   -    -    -    (7,889)   -    (7,889)
Dividends distributions / withdrawals made   -    -    -    -    -    -    -    (464,977)   -    252,740    (212,237)   -    (212,237)
Transfer of retained earnings to reserves   -    309,982    -    -    
 
    -    -    (309,982)   -    -    
 
    -    - 
Provision for mandatory dividends   -    -    -    -    -    -    -    -    -    (237,683)   (237,683)   -    (237,683)
Others   -    -    -    -    -    -    -    -    -    -    -    21    21 
Subtotal   -    309,982    -    -    -    -    (7,889)   (774,959)   -    15,057    (457,809)   21    (457,788)
Other comprehensive income   -    -    -    2,863    254,743    (70,903)   -    -    -    -    186,703    (23)   186,680 
Result of continuous operations   -    -    -    -    -    -    -    -    792,276    -    792,276    15,206    807,482 
Result of discontinuous operations   -    -    -    -    -    -    -    -    -    -    -    -    - 
Subtotal   -    -    -    2,863    254,743    (70,903)   -    -    792,276    -    978,979    15,183    994,162 
Equity as of December 31, 2022   891,303    2,862,765    (2,224)   (110,130)   (118,838)   61,821    590,247    124,846    792,276    (237,683)   4,854,383    109,564    4,963,947 
Distribution of income from previous period   -    -    -    -    -    -    -    792,276    (792,276)   -    -    -    - 
Equity as of January 1, 2023   891,303    2,862,765    (2,224)   (110,130)   (118,838)   61,821    590,247    917,122    -    (237,683)   4,854,383    109,564    4,963,947 
Issued perpetual bonds and interest   -    -    -    -    -    -    18,474    -    -    -    18,474    -    18,474 
Dividends distributions / withdrawals made   -    -    -    -    -    -    -    (485,191)   -    -    (485,191)   -    (485,191)
Transfer of retained earnings to reserves   -    300,069    -    -         -    -    (300,069)   -    -    -    -    - 
Provision for mandatory dividends   -    -    -    -    -    -    -    -    -    88,762    88,762    -    88,762 
Others   -    -    -    -    -    -    -    -    -    -    -    (49)   (49)
Subtotal   -    300,069    -    -    -    -    18,474    (785,260)   -    88,762    (377,955)   (49)   (378,004)
Other comprehensive income   -    -    -    18,534    203,254    (59,883)   -    -    -    -    161,905    810    162,715 
Result of continuous operations   -    -    -    -    -    -    -    -    579,427    -    579,427    14,410    593,837 
Result of discontinuous operations   -    -    -    -    -    -    -    -    -    -    -    -    - 
Subtotal   -    -    -    18,534    203,254    (59,883)   -    -    579,427    -    741,332    15,220    756,552 
Equity as of December 31, 2023   891,303    3,162,834    (2,224)   (91,596)   84,416    1,938    608,721    131,862    579,427    (148,921)   5,217,760    124,735    5,342,495 

 

The accompanying notes form integral part of these consolidated financial statements.

 

F-7

Banco Santander-Chile and Subsidiaries
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
For the years ended,

 

Period  Total
attributable to
shareholders
of the Bank
  

Allocated to

reserves

   Allocated to
dividends
  

Percentage

distributed

  

Number of

shares

  

Dividend
per share

(in pesos)

 
   MCh$   MCh$   MCh$   %         
Year 2021 (Shareholders meeting April 2023)   808,651    300,069    485,191    60    188,446,126,794    2.575 
Year 2021 (Shareholders meeting April 2022)   774,959    309,982    464,977    60    188,446,126,794    2.467 

 

The accompanying notes form integral part of these consolidated financial statements.

 

F-8

Banco Santander-Chile and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended,

 

      December 31, 
      2023   2022   2021 
   NOTE  MCh$   MCh$   MCh$ 
A - CASH FLOWS FROM OPERATING ACTIVITIES               
NET INCOME FOR THE YEAR      593,837    807,482    852,428 
Adjustments for non-cash items included in net income      (1,306,901)   (1,456,419)   (1,440,550)
Depreciation and amortization  32   143,762    129,993    122,055 
Impairment of property, plant, and equipment  32   1,912    
-
    
-
 
Provision for loan losses  33   429,854    447,071    368,082 
Mark to market of trading investments      (125,613)   (20,173)   (18,031)
Income from investments in associates and other companies  9   (8,763)   (10,310)   (2,383)
Net gain on sale of assets received in lieu of payment  28   (8,452)   (4,354)   (5,479)
Provision on assets received in lieu of payment  28   (858)   743    349 
Net gain on sale of property, plant and equipment  28   (5,281)   (6,405)   (673)
Net interest income  25   (1,093,049)   (1,570,112)   (1,811,351)
Net fee and commission income  26   (502,640)   (407,268)   (332,751)
Changes in deferred taxes  13   (131,195)   (52,181)   226,810 
Other non-cash items      (6,578)   36,577    12,822 
Increase/decrease in operating assets and liabilities      2,028,822    289,949    (6,557)
(Increase)/decrease of loans and accounts receivables from customers, net      (2,047,036)   (2,026,071)   (2,244,100)
(Increase)/decrease of financial investments      (1,908,858)   (647,482)   (2,960,906)
Decrease/ (increase) of interbank loans      (35,372)   (32,527)   18,502 
Decrease/(increase) of assets received or awarded in lieu of payment      (5,685)   (1,533)   4,822 
Increase/(decrease) of debits in customers checking accounts      (697,222)   (2,673,664)   3,042,985 
(Decrease)/increase of time deposits and other time liabilities      3,159,152    2,847,734    (450,736)
(Decrease)/increase of obligations with domestic banks      4,900    40,093    (215,876)
Increase/(decrease) of other demand liabilities or time obligations      (162,301)   (756,337)   190,050 
Increase/(decrease) of obligations with foreign banks      1,032,051    25,445    2,061,681 
Increase/(decrease) of obligations with Central Bank of Chile      464,784    (27,356)   652,179 
(Decrease)/increase of obligations under repurchase agreements      (32,771)   228,721    (883,174)
(Decrease)/increase in other financial liabilities      3,278    110,089    (1,411)
(Decrease)/increase of other assets and liabilities      940,645    1,989,113    (2,535,796)
Redemption of letters of credit      (2,568)   (3,681)   (4,835)
Senior bond issuances      775,171    461,221    1,471,106 
Redemption of senior bonds and payments of interest      (266,794)   (1,183,950)   (6,483)
Redemption of mortgage bonds and payments of interest      (7,545)   (6,655)   (289,173)
Redemption of perpetual bond and payments of interest      (28,243)   
-
    
-
 
Payment of interest on lease obligations      (3,601)   (31,118)   
-
 
Interest received      4,662,944    4,086,656    2,921,097 
Interest paid      (4,135,540)   (2,516,544)   (1,109,746)
Dividends received from investments in other companies  9   2,944    526    506 
Fees and commissions received      621,286    729,063    578,604 
Fees and commissions paid      (304,797)   (321,794)   (245,853)
Total cash flow (used in) provided by operating activities      1,315,758    (358,988)   (594,679)

 

F-9

Banco Santander-Chile and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended,

 

      December 31, 
      2023   2022   2021 
   NOTE  MCh$   MCh$   MCh$ 
B - CASH FLOWS FROM INVESTMENT ACTIVITIES:               
Purchases of property, plant, and equipment  11   (76,426)   (58,393)   (57,995)
Sales of property, plant, and equipment      1,643    18,690    2,498 
Purchases of intangible assets  10   (45,067)   (54,899)   (28,774)
Total cash flow used in investment activities      (117,850)   (94,602)   (84,271)
C - CASH FLOW FROM FINANCING ACTIVITIES:                  
Dividends paid      (485,191)   (464,977)   (310,468)
Placement of subordinated bond      -    102,481    - 
Placement of perpetual bond      -    -    595,175 
Lease obligations paid      (30,101)   (21,827)   (46,046)
Total cash flow used in financing activities      (515,292)   (384,323)   238,661 
D – NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS DURING THE YEAR      682,616    (837,913)   (440,289)
E – EFFECTS OF FOREIGN EXCHANGE RATE FLUCTUATIONS      (1,778)   25,904    437,564 
F - INITIAL BALANCE OF CASH AND CASH EQUIVALENTS      2,079,886    2,891,895    2,894,620 
                   
FINAL BALANCE OF CASH AND CASH EQUIVALENTS  4   2,760,724    2,079,886    2,891,895 

 

Reconciliation of provisions for the Consolidated Statements of
Cash Flow for the year ended
     December 31, 
      2023   2022   2021 
      MCh$   MCh$   MCh$ 
                
Provision for loan losses for cash flow purposes  33   429,854    447,071    368,227 
Recovery of loans previously charged off  33   (107,069)   (90,577)   (76,999)
Provision for loan losses – net
      322,785    356,494    291,228 

 

           Changes not related to cash flows     
Reconciliation of liabilities that arise from financing activities 

31-12-2022

   Cash Flow   Acquisition   Foreign currency exchange   UF Inflation effect   Fair value changes  

31-12-2023

 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Subordinated bonds    1,733,870    -             -           -    80,069             -    1,813,939 
Senior bonds   7,080,472    508,377    -    -    336,536    -    7,925,385 
Mortgage bonds   81,623    (7,545)   -    -    353    -    74,431 
Paid dividend   -    (485,191)   -    -         -    (485,191)
Lease obligations   137,089    (33,702)   -    -    1,129    -    104,516 
Total liabilities related to financing activities   9,033,054    (18,061)   -    -    418,087    -    9,433,080 

 

The accompanying notes form integral part of these consolidated financial statements.

 

F-10

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

CORPORATE INFORMATION

 

Banco Santander-Chile is a banking corporation (limited company) operating under the laws of the Republic of Chile, headquartered at Bandera N°140, Santiago. The corporation provides a broad range of general banking services to its customers, ranging from individuals to major corporations. Banco Santander-Chile and its subsidiaries (collectively referred to herein as the “Bank” or “Banco Santander-Chile”) offers commercial and consumer banking services, including (but not limited to) factoring, collection, leasing, securities and insurance brokering, mutual and investment fund management brokering, and investment banking. Banco Santander Spain controls Banco Santander-Chile through its holdings in Teatinos Siglo XXI Inversiones S.A. and Santander Chile Holding S.A., which are controlled subsidiaries of Banco Santander Spain. As of December 31, 2023 Banco Santander Spain owns or controls directly and indirectly 99.8% of Santander Chile Holding S.A. and 100% of Teatinos Siglo XXI Inversiones S.A. Banco Santander Spain, through its subsidiaries, has control over 67.18% of the Bank’s shares.

 

a.Basis of preparation

 

These Consolidated Financial Statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB) (hereinafter referred to as IFRS).

 

For purposes of these financial statements we use certain terms and conventions. References to “US$”, “U.S. dollars” and “dollars” are to United States dollars, references to “EUR” are to European Economic Community Euro, references to “CNY” are to Chinese Yuan, reference to “JPY” are to Japanese Yuan, references to “CHF” are to Swiss franc, references to “Chilean pesos”, “pesos” or “Ch$” are to Chilean pesos, and references to “UF” are to Unidades de Fomento. The UF is an inflation-indexed Chilean monetary unit with a value in Chilean pesos that changes daily to reflect changes in the official Consumer Price Index (“CPI”) of the Instituto Nacional de Estadísticas (the Chilean National Institute of Statistics) for the previous month.

 

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 is equaled to Ch$36,789.36 as of December 31, 2023 and Ch$35,110.98 as of December 31, 2022. In 2023, UF inflation was 4.7% compared to 13.3% in 2022. 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.

 

The Notes to the Consolidated Financial Statements contain additional information to support the figures submitted in the Consolidated Statements of Financial Position, Consolidated Statements of Income, Consolidated Statements of Comprehensive Income, Consolidated Statements of Changes in Equity and Consolidated Statements of Cash Flows for the period.

 

b.Basis of preparation for the Consolidated Financial Statements

 

The Consolidated Financial Statements for the years ended December 31, 2023, 2022 and 2021, incorporate the financial statements of the entities over which the Bank has control (including structured entities); and includes the adjustments, reclassifications and eliminations needed to comply with the accounting and valuation criteria established by IFRS. Control is achieved when the Bank:

 

i.has power over the investee;

 

ii.is exposed, or has rights, to variable returns from its involvement with the investee; and

 

iii.has the ability to use its power to affect its returns.

 

The Bank reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control listed above. When the Bank has less than a majority of the voting rights of an investee, it has power over the investee when the voting rights are sufficient to give it the practical ability to direct the relevant activities over the investee unilaterally. The Bank considers all relevant facts and circumstances in assessing whether or not the Bank’s voting rights in an investee are sufficient to give it power, including:

 

the size of the Bank’s holding of voting rights relative to the size and dispersion of holdings of the other vote holders;

 

potential voting rights held by the Bank, other vote holders or other parties;

 

rights arising from other agreements; and

 

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

 

F-11

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

Consolidation of a subsidiary begins when the Bank obtains control over the subsidiary and ceases when the Bank loses control over the subsidiary. Specifically, income and expenses of a subsidiary acquired or disposed of during the year are included in the Consolidated Statements of Income and Comprehensive Income from the date the Bank gains control until the date when the Bank ceases to control the subsidiary.

 

Profit or loss and each component of other comprehensive income are attributed to the owners of the Bank and to the non-controlling interests. Total comprehensive income of subsidiaries is attributed to the owners of the Bank and to the non-controlling interests even if this results in the non-controlling interests having a deficit in certain circumstances.

 

When necessary, adjustments are made to the financial statements of the subsidiaries to ensure their accounting policies are consistent with the Bank’s accounting policies. All intragroup assets, liabilities, equity, income, expenses and cash flows relating to transactions between consolidated entities are eliminated in full on consolidation.

 

Changes in the consolidated entities ownership interests in subsidiaries that do not result in a loss of control over the subsidiaries are accounted for as equity transactions. The carrying values of the Bank’s equity and the non-controlling interests’ equity are adjusted to reflect the changes to their relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity and attributed to owners of the Bank.

 

In addition, third parties’ shares in the Bank’s consolidated equity are presented as “Non-controlling interests” in the Consolidated Statements of Changes in Equity. Their share in the income for the year is presented as “Attributable to non-controlling interest” in the Consolidated Statements of Income.

 

The following companies are considered entities controlled by the Bank and are therefore within the scope of consolidation:

 

i.Entities controlled by the Bank through participation in equity

 

         Percent ownership share
As of December 31,
 
      Place of  2023   2022   2021 
     Incorporation  Direct   Indirect   Total   Direct   Indirect   Total   Direct   Indirect   Total 
Name of the Subsidiary  Main Activity  and operation  %   %   %   %   %   %   %   %   % 
Santander Corredora de Seguros Limitada  Insurance brokerage  Santiago, Chile   99.75    0.01    99.76    99.75    0.01    99.76    99.75    0.01    99.76 
Santander Corredores de Bolsa Limitada  Financial instruments brokerage  Santiago, Chile   50.59    0.41    51.00    50.59    0.41    51.00    50.59    0.41    51.00 
Santander Asesorias Financieras Limitada  Securities brokerage  Santiago, Chile   99.03    -    99.03    99.03    -    99.03    99.03    -    99.03 
Santander S.A. Sociedad Securitizadora  Purchase of credits and issuance of debt instruments  Santiago, Chile   99.64    -    99.64    99.64    -    99.64    99.64    -    99.64 
Klare Corredora de Seguros S.A.  Insurance brokerage  Santiago, Chile   50.10    -    50.10    50.10    -    50.10    50.10    -    50.10 
Santander Consumer Chile S.A.  Financing  Santiago, Chile   51.00    -    51.00    51.00    -    51.00    51.00    -    51.00 
Sociedad operadora de Tarjetas de Pago Santander Getnet Chile S.A. (1)  Card operator  Santiago, Chile   99.99    0.01    100.00    99.99    0.01    100.00    99.99    0.01    100.00 

 

The detail of non-controlling participation on all the remaining subsidiaries can be seen in Note 24– Non-controlling interest.

 

ii.Entities controlled by the Bank through other considerations

 

The following companies have been consolidated based on the determination that the Bank has control as previously defined above and in accordance with IFRS 10 “Consolidated Financial Statements” (IFRS 10):

 

-Santander Gestión de Recaudación y Cobranza Limitada (collection services)

 

-Bansa Santander S.A. (financing revolving inventory lines to automotive dealers)

 

-Multiplica SpA (Development card incentive programmes)

 

-Pagonxt Trade Chile SPA (data processing and transmission services, databases and resources)

 

F-12

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

iii.Associates

 

An associate is an entity over which the Bank has significant influence. Significant influence, in this case, is defined as the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies. An investment in an associate is accounted for using the equity method from the date on which the investee becomes an associate.

 

The following companies are considered “Associates” in which the Bank accounts for its participation using the equity method:

 

         Percentage of ownership share 
      Place of  As of December 31, 
      Incorporation  2023   2022   2021 
Associates  Main activity  and operation  %   %   % 
Redbanc S.A.  ATM services  Santiago, Chile   33.43    33.43    33.43 
Transbank S.A.  Debit and credit card services  Santiago, Chile   25.00    25.00    25.00 
Centro de Compensación Automatizado S.A.  Electronic fund transfer and compensation services  Santiago, Chile   33.33    33.33    33.33 
Sociedad Interbancaria de Depósito de Valores S.A.  Delivery of securities on public offer  Santiago, Chile   29.29    29.29    29.29 
Cámara Compensación de Pagos de Alto Valor S.A.  Payments clearing  Santiago, Chile   15.00    15.00    15.00 
Administrador Financiero del Transantiago S.A.  Administration of boarding passes to public transportation  Santiago, Chile   20.00    20.00    20.00 
Servicios de Infraestructura de Mercado OTC S.A.  Administration of the infrastructure for the financial market of derivative instruments  Santiago, Chile   12.48    12.48    12.48 

  

In the case of Cámara Compensación de Pagos Alto Valor S.A., Banco Santander-Chile has a representative on the Board of Directors. As per the definition of associates, the Bank has concluded that it exerts significant influence over those entities.

 

In the case of Servicios de Infraestructura de Mercado OTC S.A., the Bank actively participates, through its executives, in the administration and in the process of organization, which is why the Administration has concluded that it exerts significant influence on it.

 

c.Non-controlling interest

 

Non-controlling interest represents the portion of net income and net assets which the Bank does not own, either directly or indirectly. It is presented as “Attributable to non-controlling interest” separately in the Consolidated Statements of Income, and separately from shareholders’ equity in the Consolidated Statements of Financial Position.

 

In the case of entities controlled by the Bank through other considerations, income and equity are presented in full as non-controlling interest, since the Bank controls them, but does not have any ownership expressed as a percentage.

 

d.Reporting segments

 

Operating segments are components of an entity:

 

i.that engages in business activities from which it may earn revenues and incur expenses (including revenues and expenses from transactions with other components of the same entity);

 

ii.whose operating results are regularly reviewed by the entity’s chief executive officer, who makes decisions about resources allocated to the segment and assess its performance; and

 

iii.for which discrete financial information is available.

 

F-13

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

Two or more segments can be combined only if aggregation is consistent with International Financial Reporting Standard 8 “Operating Segments” (IFRS 8) and the segments have similar economic characteristics and are similar in each of the following respects:

 

i.the nature of the products and services;

 

ii.the nature of the production processes;

 

iii.the type or class of customers that use their products and services;

 

iv.the methods used to distribute their products or services; and

 

v.if applicable, the nature of the regulatory environment, for example, banking, insurance, or public utilities.

 

The Bank reports separately on each operating segment that exceeds any of the following quantitative thresholds:

 

i.its reported revenue, from both external customers and intersegment sales or transfers, is 10% or more of the combined internal and external revenue of all the operating segments.

 

ii.the absolute amount of its reported profit or loss is 10% or more of the greater in absolute amount of: (i) the combined reported profit of all the operating segments that did not report a loss; (ii) the combined reported loss of all the operating segments that reported a loss.

 

iii.its assets represent 10% or more of the combined assets of all the operating segments.

 

Operating segments that do not meet any of the quantitative threshold may be treated as segments to be reported, in which case the information must be disclosed separately if management believes it could be useful for the users of the Consolidated Financial Statements.

 

Information about other business activities of the operating segments not separately reported is combined and disclosed in the “Other segments” category.

 

e.Functional and presentation currency

 

According to International Accounting Standard (IAS) 21 “The Effects of Changes in Foreign Exchange Rates”, the Chilean peso, which is the currency of the primary economic environment in which the Bank operates and the currency which influences its costs and revenue structure, has been defined as the Bank’s functional and presentation currency.

 

Accordingly, all balances and transactions denominated in currencies other than the Chilean Peso are treated as “foreign currency”.

 

The Bank maintains its accounting records and prepares its financial statements in Chilean pesos.

 

f.Foreign currency transactions

 

The Bank performs transactions in foreign currencies, mainly in U.S. dollar. Assets and liabilities denominated in foreign currencies, held by the Bank and its subsidiaries are translated to Chilean pesos at the representative market exchange rate of the month for the reported period; the rate used was Ch$874,45 as of December 31, 2023 (Ch$849.59 per US$1 as of December 31, 2022).

 

The amounts of net foreign exchange gains and losses includes recognition of the effects that exchange rate variations have on assets and liabilities denominated in foreign currencies and the profits and losses on foreign exchange spot and forward transactions undertaken by the Bank.

 

g.Classification and measurement of financial instrument

 

I.Classification of financial instrument

 

i.Classification of financial assets

 

Financial assets are classified into a measurement category based on both the Bank’s business model for managing the financial asset and the contractual cash flow characteristics of the financial asset.

 

Contractual cash flow assessment determines if the cash flows from the financial asset meet the SPPI (solely payment of principal and interest) criterion, i.e., whether the contractual terms of the financial asset give rise, on specific dates, to cash flows that are solely payments of principal and interest. Principal is the fair value of the financial assets at initial recognition, and interest is the consideration for the time value of money, the credit risk associated with the principal outstanding, and also may include liquidity risk, administrative cost and profit margin.

 

For classification process the Bank perform the SPPI test, which assesses the contractual term to identify whether they meet SPI criterion, i.e., the contract is a basic lending arrangement. The Bank applies judgement and considers relevant factors such as currency in which the financial asset is denominated, and period for which the interest rate is set.

 

F-14

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

Business model refers to how the Bank manages its financial assets in order to generate cash flows. The Bank determined its business model on initial application of IFRS 9 at the level that best reflects how it manages groups of financial assets to achieve its business objective.

 

The Banks’s business model is not assessed on an instrument-by- instrument basis, but at a higher level of aggregated portfolio and is based on observable factors such as: performance of the financial assets, the risk that affect the performance, and the expected frequency, value and timing of sales.

 

In accordance with IFRS 9 the business models are:

 

Held to collect business model (HTC) - financial assets that are held within a business model whose objective is to hold assets in order to collect contractual cash flows are managed to realize cash flows by collecting contractual payments over the life of the instrument, under this business model sales made when there is an increase in the credit risk, or to manage credit concentration risk are not inconsistent with a business model whose objective is to hold financial assets to collect contractual cash flows.

 

Held to collect and sell (HTC&S) - financial assets under this business model achieve the objective by both collecting contractual cash flows and selling financial assets, then involve a greater frequency and value of sales than HTC business model.

 

Other business model - financial assets held in this business has the objective of realizing cash flows through the sale of the assets. The Bank makes decisions based on the assets’ fair values and manages the assets to realize those fair values.

 

In accordance to the above mentioned, financial instruments are assigned to portfolios which represent specific business models. Each portfolio has its proper business objective and seek to face liquidity risk, inflation and interest rate risk effectively.

 

Due to exceptional changes arose in the liquidity market, changes that we expect to face in the short and middle term, the Bank is requiring to maintain certain collaterals with 2024-2026 maturity to guarantee a loan programme led by the Chilean Central Bank (“FCIC”), and also is required to establishing greater Technical Reserves due to increase in currents accounts, time deposits and other on demand deposits from our clients. For this reason, the Bank has to create a new business model “Held-to-collect” whose objective is to manage properly the prevailing high level of liquidity, where additionally the Bank has the intention and the ability to hold them until maturity.

 

The Bank classified all financial liabilities as subsequently measured at amortised cost, except for derivatives that are liabilities, which are measured at fair value through profit or loss.

 

ii.Reclassification

 

Reclassification of financial assets is required if, and only if, the objective of the Bank’s business model for managing those financial assets changes. Financial liabilities cannot be reclassified.

 

II. Measurement of financial instruments

 

i.Initial measurement

 

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 are directly attributable to the acquisition or issue of the financial asset or financial liability.

 

ii.Subsequent measurement- financial assets

 

After initial recognition, the Bank shall measure a financial asset at:

 

(a)Amortised 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 amortised cost.

 

The effective interest method is used in the calculation of the amortised 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 amortised cost of a financial liability.

 

F-15

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

(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 flows 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, interestincome and foreign currency exchange gains and losses) are recognised in other comprehensive income, until the assets are sold. Upon disposal, the cumulative gain and losses in OCI are recognised in the income statements.

 

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 recognised at fair value through profit or loss, likewise derivatives contracts for trading purposes.

 

(c)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 recognised in profit or loss. Gains or losses on derecognition of these equity instruments are not transferred to profit or loss.

 

iii.Subsequent measurement- financial liabilities

 

After initial recognition, the Bank shall measure a financial liability at amortised cost.

 

III. Derecognition of financial assets and liabilities

 

Financial assets are derecognised when, and only when:

 

the contractual rights to the cash flows from the financial asset expire, or

 

the Bank transfers substantially all the risks and rewards of ownership of the financial asset, and therefore the Bank derecognises the financial asset and recognise separately any rights and obligations created or retained in the transfer.

 

In some cases, the Bank enters into transactions for which it retains the contractual rights to receive the cash flows of the financial asset but assumes a contractual obligation to pay the cash flows in an arrangement that meets all the conditions required, i.e. the Bank only transfers collected amounts from original assets, selling or pledging original assets is prohibited, and the Bank has the obligation to remit cash flows collected without material delay.

 

When a financial asset is sold and the Bank simultaneously agrees to repurchase it (or an asset that is substantially the same) at a fixed price on a future date, the Bank continues to recognise the financial assets in their entirety in the statements of financial position because it retains substantially all of the risks and rewards of ownership. The cash consideration received is recognised as a financial asset and a financial liability is recognised for the obligation to pay the repurchase price.

 

Financial liabilities are derecognised when, and only when, they are extinguished, cancelled or expired.

 

IV. Contingent loan

 

The Bank issues contingent liabilities (including letters of credit, foreign letters of credit and performance guarantee) and loan commitments.

 

Contingent liabilities and undrawn loan commitments are commitments under which, over the duration of the commitment, the Bank is required to provide a loan with pre-specified term to the customer.

 

The nominal contractual loan value, when the loan agreed to be provided is on market terms, is not recorded in the statements of financial position. The related ECL allowances are disclosed in Note 19.

 

V. Offsetting of financial instruments

 

Financial asset and liability balances are offset, i.e., reported in the Consolidated Statements of Financial Position at their net amount, only if there is a legally enforceable right to offset the recorded amounts and the Bank intends either to settle them on a net basis or to realize the asset and settle the liability simultaneously. As of December 31, 2023 and 2022 the Bank does not have balance offsetting of financial instruments.

 

F-16

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

h.Derivatives and hedging activities

 

The Bank has elected to continue applying the hedge accounting requirements of IAS 39 on adoption of IFRS 9.

 

A “financial derivative” is a financial instrument whose value changes in response to the changes in an underlying observable market variable (such as an interest rate, a foreign exchange rate, a financial instrument’s price, or a market index, including credit ratings), whose initial investment is very small compared with other financial instruments having a similar response to changes in market factors, and which is generally settled at a future date.

 

For presentation purposes, derivatives are presented in accordance with its positive or negative fair value as assets or liabilities, respectively, and include trading and hedging instruments separately (see Note 6).

 

Hedging transactions

 

The bank has elected to continue applying the hedge accounting requirements in IAS 39 instead of the requirements of IFRS 9, thus the Bank uses financial derivatives for the following purposes:

 

i.to sell to customers who request these instruments in the management of their market and credit risks;

 

ii.to use these derivatives in the management of the risks of the Bank entities’ own positions and assets and liabilities (“hedging derivatives”), and

 

iii.to obtain profits from changes in the price of these derivatives (trading derivatives).

 

All financial derivatives that are not held for hedging purposes are accounted for as trading derivatives.

 

A derivative qualifies for hedge accounting if all the following conditions are met:

 

1.The derivative hedges one of the following three types of exposure:

 

a.Changes in the value of assets and liabilities due to fluctuations, among others, in the interest rate and/or exchange rate to which the position or balance to be hedged is subject (“fair value hedge”);

 

b.Changes in the estimated cash flows arising from financial assets and liabilities, and highly probable forecasted transactions (“cash flow hedge”);

 

c.The net investment in a foreign operation (“hedge of a net investment in a foreign operation”).

 

2.It is effective in offsetting exposure inherent in the hedged item or position throughout the expected term of the hedge, which means that:

 

a.At the date of arrangement the hedge is expected, under normal conditions, to be highly effective (“prospective effectiveness”).

 

b.There is sufficient evidence that the hedge was actually effective during the life of the hedged item or position (“retrospective effectiveness”).

 

The changes in the value of financial instruments qualifying for hedge accounting are recorded as follows:

 

i.For fair value hedges, the gains or losses arising on both hedging instruments and the hedged items (attributable to the type of risk being hedged) are included as “Net income (expense) from financial operations” in the Consolidated Statements of Income.

 

ii.For fair value hedges of interest rate risk on a portfolio of financial instruments (macrohedges), gains or losses that arise in measuring hedging instruments within “Interest income and expense”, and other gains or losses due to changes in fair value of the underlying hedged item (attributable to the hedged risk) are recorded in the Consolidated Statements of Income under “Net income (expense) from financial operations”.

 

iii.For cash flow hedges, the change in fair value of the hedging instrument is included as “Cash flow hedge” in “Other comprehensive income”.

 

iv.The differences in valuation of the hedging instrument corresponding to the ineffective portion of the cash flow hedging transactions are recorded directly in the Consolidated Statements of Income under “Net income (expense) from financial operations”.

 

F-17

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

If a derivative designated as a hedging instrument no longer meets the requirements described above due to expiration, ineffectiveness or for any other reason, hedge accounting treatment is discontinued. When “fair value hedging” is discontinued, the fair value adjustments to the carrying amount of the hedged item arising from the hedged risk are amortised to gain or loss from that date, where applicable.

 

When cash flow hedges are discontinued, any cumulative gain or loss of the hedging instrument recognised under “Other comprehensive income” (from the period when the hedge was effective) remains recorded in equity until the hedged transaction occurs, at which time it is recorded in the Consolidated Statements of Income, unless the transaction is no longer expected to occur, in which case any cumulative gain or loss is recorded immediately in the Consolidated Statements of Income.

 

i.Fair value measurement

 

In general, financial assets and liabilities are initially recognised at fair value which, in the absence of evidence to the contrary, is deemed to be the transaction price. Financial instruments, other than those measured at fair value through profit or loss, are initially recognised at fair value plus transaction costs. Subsequently, and at the end of each reporting period, financial instruments are measured pursuant to the following criteria:

 

i.Valuation of financial instruments

 

Financial assets are measured according to their fair value, gross of any transaction costs that may be incurred in the course of a sale, except for loans and accounts receivable from customers.

 

“Fair value” is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal (or most advantageous) market at the measurement date under current market conditions (i.e. an exit price) regardless of whether that price is directly observable or estimated using another valuation technique. When measuring fair value an entity shall take into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date.

 

The fair value measurement assumes that the transaction to sell the asset or transfer the liability takes place either: (a) in the principal market for the asset or liability, or (b) in the absence of a principal market, the most advantageous market for the asset or liability. Even when there is no observable market to provide pricing information in connection with the sale of an asset or the transfer of a liability at the measurement date, the fair value measurement shall assume that the transaction takes place, considered from the perspective of a potential market participant who intends to maximize value associated with the asset or liability.

 

When using valuation techniques, the Bank shall maximize the use of relevant observable inputs and minimize the use of unobservable inputs as available. If an asset or a liability measured at fair value has a bid price and an ask price, the price within the bid-ask spread that is most representative of fair value in the circumstances shall be used to measure fair value regardless of where the input is categorized within the fair value hierarchy (i.e. Level 1, 2 or 3). IFRS 13 establishes a fair value hierarchy that categorizes into three levels the inputs to valuation techniques used to measure fair value. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1 inputs) and the lowest priority to unobservable inputs (Level 3 inputs).

 

All derivatives are recorded in the Consolidated Statements of Financial Position at the fair value previously described. This value is compared to the valuation as at the trade date. If the fair value is subsequently measured positive, this is recorded as an asset. If the fair value is subsequently measured negative, this is recorded as a liability. The fair value on the trade date is deemed, in the absence of evidence to the contrary, to be the transaction price. The changes in the fair value of derivatives from the trade date are recorded in “Net income (expense) from financial operations” in the Consolidated Statements of Income.

 

Specifically, the fair value of financial derivatives included in the ortfolios of financial assets or liabilities held for trading is deemed to be their daily quoted price. If, for exceptional reasons, the quoted price cannot be determined on a given date, the fair value is determined using similar methods to those used to measure over the counter (OTC) derivatives. The fair value of OTC derivatives is the sum of the future cash flows resulting from the instrument, discounted to present value at the date of valuation (“present value” or “theoretical close”) using valuation techniques commonly used by the financial markets: “net present value” (NPV) and option pricing models, among other methods. Also, 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 Bank´s own risk. The Credit valuation adjustment (CVA) is a valuation adjustment to OTC derivatives as a result of the risk associated with the credit exposure assumed by each counterparty.

 

F-18

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

The CVA is calculated taking into account potential exposure to each counterparty in each future period. The debit valuation adjustment (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 in OTC derivatives.

 

ii.Valuation techniques

 

Financial instruments at fair value, determined on the basis of price quotations in active markets, include government debt securities, private sector debt securities, equity shares, short positions, and fixed-income securities issued.

 

In cases where price quotations cannot be observed in available markets, the Bank’s management determines a best estimate of the price that the market would set using its own internal models. In most cases, these models use data based on observable market parameters as significant inputs however for some valuations of financial instruments, significant inputs are unobservable in the market. To determine a value for those instruments, various techniques are employed to make these estimates, including the extrapolation of observable market data.

 

The most reliable evidence of the fair value of a financial instrument on initial recognition usually is the transaction price, however due to lack of availability of market information, the value of the instrument may be derived from other market transactions performed with the same or similar instruments or may be measured by using a valuation technique in which the variables used include only observable market data, mainly interest rates.

 

The main techniques used as of December 31, 2023 and 2022 by the Bank’s internal models to determine the fair value of the financial instruments are as follows:

 

i.In the valuation of financial instruments permitting static hedging (mainly forwards and swaps), the present value method is used. Estimated future cash flows are discounted using the interest rate curves of the related currencies. The interest rate curves are generally observable market data.

 

ii.In the valuation of financial instruments requiring dynamic hedging (mainly structured options and other structured instruments), the Black-Scholes model is normally used. Where appropriate, observable market inputs are used to obtain factors such as the bid-offer spread, exchange rates, volatility, correlation indexes and market liquidity.

 

iii.In the valuation of certain financial instruments exposed to interest rate risk, such as interest rate futures, caps and floors, the present value method (futures) and the Black-Scholes model (plain vanilla options) are used. The main inputs used in these models are observable market data, including the related interest rate curves, volatilities, correlations and exchange rates.

 

The fair value of the financial instruments calculated by the aforementioned internal models considers contractual terms and observable market data, which include interest rates, credit risk, exchange rates, quoted market price of shares, volatility and prepayments, among others. The Bank’s management considers that its valuation models are not significantly subjective, since these methodologies can be adjusted and evaluated, as appropriate, through the internal calculation of fair value and the subsequent comparison with the related actively traded price.

 

j.Recognising income and expenses

 

The most significant criteria used by the Bank to recognise its revenues and expenses are summarised as follows:

 

i.Interest revenue, interest expense, and similar items

 

Interest income is calculated by applying the effective interest rate to the gross carrying amount of financial assets, except for financial assets that have subsequently become credit-impaired (or ’stage 3’), for which interest revenue is calculated by applying the effective interest rate to their amortised cost (i.e. net of the ECL provision).

 

A substantial portion of our loan portfolio is denominated in UF’s, a unit that is daily indexed to reflect inflation recorded in the previous month, with the net gain or loss resulting from such indexation reflected in the interest income and inflation line in the consolidated statement of income.

 

ii.Commissions, fees, and similar items

 

Fee and commission income and expenses are recognised in the Consolidated Statements of Income using criteria established in IFRS 15 “Revenue from contracts with customers”.

 

F-19

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

Under IFRS 15, the Bank recognises revenue when (or as) satisfied a performance obligation by transferring a service (i.e. an asset) to a customer; under this definition an asset is transferred when (or as) the customer obtains control of that asset. The Bank considers the terms of the contract and its customary business practices to determine the transaction price.

 

The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third-parties.

 

The Bank transfers control of a good or service over time and, therefore, satisfies a performance obligation and recognises revenue over time, and/or the Bank satisfies the performance obligation at a point in time.

 

The main revenues arising from commissions, fees and similar items correspond to:

 

-Fees and commissions for lines of credits and overdrafts: includes accrued fees related to granting lines of credit and overdrafts in checking accounts.

 

-Fees and commissions for guarantees and letters of credit: includes accrued fees in the period relating to granting of guarantee payment for current and contingent third party obligations.

 

-Fees and commissions for card services: includes accrued and earned commissions in the period related to use of credit cards, debit cards and other cards

 

-Fees and commissions for management of accounts: includes accrued commissions for the maintenance of checking, savings and other accounts

 

-Fees and commissions for collections and payments: includes income arising from collections and payments services provided by the Bank.

 

-Fees and commissions for intermediation and management of securities: includes income from brokerage, placements, administration and securities’ custody services.

 

-Fees and commissions for insurance brokerage fees: includes income arising for insurances distribution.

 

-Other fees and commissions: include income arising from currency changes, financial advisory, cashier check issuance, placement of financial products and online banking services.

 

The main expenses arising from commissions, fees and similar items correspond to:

 

-Compensation for card operation: includes commission expenses for credit and debit card operations related to income commissions card services.

 

-Fees and commissions for securities transactions: includes commissions expense for deposits, securities custody service and securities’ brokerage.

 

-Other fees and commissions: include mainly expenses generated from online services.

 

The Bank has incorporated disaggregated revenue and expense disclosures and reportable segment relationship in Note 26.

 

Additionally, the Bank maintains certain loyalty programmes associated to its credit cards services, for which it has deferred a percentage of the consideration received in the statements of financial position to comply with its related performance obligation or has liquidated on a monthly basis as far they arise.

 

iii.Loan arrangement fees

 

Fees that arise as a result of the origination of a loan, mainly application and analysis-related fees, are deferred and charged to the Consolidated Statements of Income over the term of the loan.

 

F-20

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

k.Impairment of non-financial assets

 

The Bank’s non-financial assets, are reviewed at the reporting date to determine whether they show signs of impairment (i.e. its carrying amount exceeds its recoverable amount). If any such evidence exists, the recoverable amount of the asset is estimated, in order to determine the extent of the impairment loss.

 

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

 

If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss.

 

In connection with other assets, impairment losses recorded in prior periods are assessed at each reporting date to determine whether the loss has decreased and should be reversed. The increased carrying amount of an asset other than goodwill attributable to a reversal of an impairment loss shall not exceed the carrying amount that would have been determined (net of amortisation or depreciation) had no impairment loss been recognised for the asset in prior years. Goodwill impairment is not reversed.

 

l.Property, plant, and equipment

 

This category includes the amount of buildings, land, furniture, vehicles, computer hardware and other fixtures owned by the consolidated entities or acquired under finance leases. Assets are classified according to their use as follows:

 

i.Property, plant and equipment for own use

 

Property, plant and equipment for own use includes but is not limited to tangible assets received by the consolidated entities in full or partial satisfaction of financial assets representing accounts receivable from third parties which are intended to be held for continuing own use and tangible assets acquired under finance leases. These assets are presented at acquisition cost less the related accumulated depreciation and, if applicable, any impairment losses (when net carrying amount was higher than recoverable amount).

 

Depreciation is calculated using the straight-line method over the acquisition cost of assets less their residual value, assuming that the land on which buildings and other structures stand has an indefinite life and, therefore, is not subject to depreciation.

The Bank applies the following useful lives for the tangible assets that comprise its assets:

 

ITEM  Useful life
(Months)
 
Land   
-
 
Paintings and works of art   
-
 
Carpets and curtains   36 
Computers and hardware   36 
Vehicles   36 
IT systems and software   36 
ATMs   60 
Other machines and equipment   60 
Office furniture   60 
Telephone and communication systems   60 
Security systems   60 
Rights over telephone lines   60 
Air conditioning systems   84 
Other installations   120 
Buildings   
1,200
 

 

The consolidated entities assess at each reporting date whether there is any indication that the carrying amount of any tangible asset exceeds its recoverable amount. If this is the case, the carrying amount of the asset is reduced to its recoverable amount and future depreciation charges are adjusted in accordance with the revised carrying amount and to the new remaining useful life.

 

The estimated useful lives of the items of property, plant and equipment held for own use are reviewed at the end of each reporting period to detect significant changes. If changes are detected, the useful lives of the assets are adjusted by correcting the depreciation charge to be recorded in the Consolidated Statements of Income in future years on the basis of the new useful lives.

 

Maintenance expenses relating to tangible assets held for own use are recorded as an expense in the period in which they are incurred.

 

F-21

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

ii.Assets leased out under operating leases

 

The criteria used to record the acquisition cost of assets leased out under operating leases, to calculate their depreciation and their respective estimated useful lives, and to record the impairment losses thereof, are consistent with those described in relation to property, plant and equipment held for own use.

 

m.Leasing

 

At inception of a contract the Bank assesses whether a contract contains a lease. A contract contains a lease if the contracts conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Bank assesses whether:

 

the contract involves the use of an identified asset – this may be specified explicitly or implicitly and should be physically distinct. If the supplier has a substantive substitution right, then the asset is not identified.

 

the Bank has the right to obtain substantially all of the economic benefits from use of the asset throughout the period of use, and

 

the Bank has the right to direct the use of the asset – this is decision-making purpose for which asset is use.

 

a.As a Lessee

 

The Bank recognises a right-of-use asset and a lease liability at the lease commencement date in accordance within IFRS 16 “Leases”. The main contracts that the Bank has are offices and branches related, which are necessary to carry out its activities.

 

At the beginning, the right-of-use asset is equal to the lease liability and is calculated as the present value of the lease payments discounted using the incremental interest rate at the commencement date, considering the lease term of each contract. The average incremental interest rate as of December 31, 2023 is 1.44%. After initial recognition, the right-of-use is subsequently depreciated using the straight-line method in accordance with the lease term of the contract, and the lease liability is amortised in accordance with the effective interest method. Financial interest is accounted as interest expense, and depreciation as depreciation expense in each period.

 

The term of the lease comprises non-cancelable periods established within each contract, while for lease contracts with an indefinite useful life, the Bank has determined to assign a useful life equal to the longer non-cancelable period of its lease agreements. The Bank has elected not to recognise right-of-use assets and lease liabilities for short term leases that have a lease term of 12 months or less and leases of low-value assets. The Bank recognises lease payments associated with these leases as an expense on a straight-line basis over the lease term. Any modification in the terms or lease should be treated as a new measurement.

 

Initially, the Bank measures the right-of-use asset at cost. The rent of the lease agreements is agreed in UF and paid in pesos. According to that, monthly variation in UF should be treated as a new measurement, and therefore, readjustments should be recognised as a modification to the obligation and the right-of-use asset.

 

The Bank has not entered into lease agreements with residual value guarantee or variable lease payments.

 

In applying IFRS 16, the Bank has used the following practical expedients permitted by the standard:

 

accounting for operating leases with a remaining lease term of less than 12 months as at January 1, 2019 as short-term leases.

 

excluding initial direct costs for the measurement of the right-of-use asset at the date of initial application.

 

The Bank has also elected not to reassess whether a contract is or contains a lease at the date of initial application. Instead, for contracts entered into before the transition date the Bank relied on its assessment made applying IAS 17 and Interpretation 4 Determining whether an Arrangement contains a Lease.

 

b. As a lessor

 

When the Bank acts as a lessor, it determines at the beginning if it corresponds to a financial or operating lease. To do this, it evaluates whether it has substantially transferred all the risks and benefits of the asset. In the affirmative case, it corresponds to a financial lease, otherwise it is a financial lease.

 

The Bank recognises the lease income on a straight-line basis over the lease term.

 

F-22

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

c.Third party financing

 

The Bank recognises the loans with third parties within “Loans and accounts receivable from customers” in the Consolidated Statements of Financial Position, the sum of the present value of the lease payments receivable from the lessee, including the exercise price of the lessee’s purchase option at the end of the lease term, when at the inception of the lease it is reasonably certain that the lessee will exercise the option.

 

The finance income and expenses arising from these contracts are recorded under “Interest income” and “Interest expense” respectively, in Consolidated Statements of Income to achieve constant return rate over the lease term.

 

n.Intangible assets

 

Intangible assets are identified as non-monetary assets (separately identifiable from other assets) without physical substance which arise as a result of legal or contractual rights. The Bank recognises an intangible asset, whether purchased or self-created (at cost), when the cost of the asset can be measured reliably, and it is probable that the future economic benefits that are attributable to the asset will flow to the Bank.

 

Intangible assets are recorded initially at acquisition or production cost and are subsequently measured at cost less any accumulated amortisation and any accumulated impairment losses.

 

Internally developed computer software is recorded as an intangible asset if, among other requirements (basically the Bank’s ability to use or sell it), it can be identified and its ability to generate future economic benefits can be demonstrated.

 

Intangible assets are amortised on a straight-line basis using the estimated useful life, which has been defined by default in 36 months, and can be modified to the extent that it is demonstrated that the Bank will benefit from the use of the intangible for a different period mentioned above.

 

Expenditure on research activities is recorded as an expense in the year in which it is incurred and cannot be subsequently capitalized.

 

o.Cash and cash equivalents

 

For the preparation of the cash flow statements, the indirect method was used, starting with the Bank’s consolidated pre-tax income and incorporating non-cash transactions, as well as income and expenses associated with cash flows, which are classified as operating, investment or financing activities.

 

For the preparation of the cash flow statements, the following items are considered:

 

i.Cash flows: Inflows and outflows of cash and cash equivalents, such as deposits with the Central Bank of Chile, deposits in domestic banks, and deposits in foreign banks.

 

ii.Operating activities: Principal revenue-producing activities performed by banks and other activities that cannot be classified as investing or financing activities.

 

The Bank’s activity of granting loans encompasses not only the activities with its debtors but also the related activities that provide the funding to the loans granted. Since the funding for granting such loans is provided by, among other sources, senior bonds, mortgage bonds and subordinated bonds, the Bank presents the related cash flows as operating activities.

 

iii.Investing activities: The acquisition and disposal of long-term assets and other investments not included in cash and cash equivalents.

 

iv.Financing Activities: Activities that result in changes in the size and composition of the equity and liabilities that are not operating activities.

 

p.Expected credit losses allowance – under IFRS 9

 

IFRS 9 established a new single impairment model applies to all financial assets measured at amortised cost and fair value through other comprehensive income (FVOCI), including commitment and contingent loans. Investments in equity are outside of the scope of the new impairment requirements.

 

F-23

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

The Bank accounted ECL related to financial assets measured at amortised cost as a loss allowance in the statements of financial position, but the carrying amount of these assets is stated net of the loss allowance. ECL related to contingent loans is accounted as a provision in the statements of financial position. The Bank recognises in profit or loss, as an impairment gain or loss, the amount of ECL (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is required to be recognised in accordance IFRS 9, for financial assets measured at amortised cost and contingent loans.

 

The model uses a dual measurement approach, under which the loss allowance is measured as either:

 

-12-month expected credit losses

 

-Lifetime expected credit losses

 

The Bank evaluates the clients within the corporate commercial loan portfolio, by preparing individual credit proposals, verifying debt servicing capacity (projected cash flow), client’s financial history and projections for economic sector. All proposal includes analysis of the client, rating and recommendation. For corporations, the evaluation includes subsidiaries and affiliates. Smaller commercial loans, mortgage loans and consumer loans are grouped into homogeneous portfolios, based on a combination of internal and external characteristics.

 

According to the Bank’s policy, an exposure will be considered as defaulted when the past-due amounts of an exposure exceed materiality thresholds for 90 or more consecutive days, it has been restructured, it is in judicial collection, it has been writen-off or has been identified as impaired by an internal risk committee. The pulling effect defined as the entire outstanding amount on any loan which has an instalment 90 days or more past due.

 

Since January 2022, the Bank updated its definition of default – new default – entailing the application of new parameters on PD, LGD y ELBE, resulting in a release of ECL allowance that amounted of MCh$3,341 for 2022.

 

The measurement basis depends on whether there has been a significant increase in credit risk since initial recognition. Based on changes in credit quality since initial recognition, IFRS 9 outlines a “three-stage” model impairment in accordance with the following diagram:

 

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, evaluated whether financial instrument’s credit risk has significantly increased since initial recognition or whether an asset is considered to be credit-impaired, and consequently classified the financial instrument in the respective stage:

 

Stage 1: When loans are first recognised, the Bank recognises an allowance based on 12 months ECL. Stage 1 loans also include facilities where the credit risk has improved, and the loan has been returned to Stage 1.

 

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 loans also include facilities, where the credit risk has improved, and the loan has been returned to stage 2.

 

Stage 3: Loans considered credit impaired. The Bank records an allowance for the lifetime ECL, setting the PD at 100%.

 

The Bank considers reasonable and supportable information that is available without undue cost or effort and that may affect the credit risk on a financial instrument, including forward looking information to determine a significant increase in credit risk since initial recognition. Forward looking information includes past events, current conditions and forecast or future economic conditions (macro-economic data).

 

Credit risk assessment and forward-looking information (including macro-economic factors), includes quantitative and qualitative information based on the Bank’s classification policy:

 

a.Adverse changes in the financial situation, such as a significant increase in debt levels.

 

b.Significant drops in turnover or in recurring cash flows.

 

c.Significant narrowing of operating margins or recurring income.

 

d.Significant adverse changes in credit risk cost, due to changes in this risk after initial recognition.

 

F-24

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

e.Other changes in the transaction’s credit risk that would impact on conditions being significantly different if the transaction were originated or reissued on the reference date.

 

f.An actual or expected reduction of the integral credit rating of the operation (client’s integral rating) or decrease in the performance score.

 

g.An actual or expected significant decrease in the price or external credit rating of the mail operation, as well as other external market indicators of the credit risk for similar operations with the same expected life.

 

The Bank will classify a loan as stage 2, if contractual payments are 30 or more consecutive days past due, because of the credit risk is deemed to have increased significantly since initial credit recognition, but is not an absolute indicator. The bank did not rebut the backstop presumption of IFRS 9 relating to SICR or default.

 

Expected credit loss measurement (ECL)

 

The ECL are 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 to measure the ECL are:

 

PD: The Probability of default is an estimate of the likelihood of default over a given time horizon. A default may only happen at a certain time over the assessed period, if the facility has not been previously derecognised and is still in the portfolio.

 

LGD: The loss given default is an estimate of the loss arising in the case where a default occurs at a given time. 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.

 

For measuring 12-month and lifetime ECL, cash shortfalls are identified as follow:

 

-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.

 

The Bank considered a multi-factor analysis to perform credit risk analysis. The type of portfolio or transactions, industry, collaterals and monitoring basis (corporate or Other commercial, which include smaller commercial, mortgage and consumer loans).

 

The Bank divides its portfolio as:

 

i.Commercial loans;

 

ii.Mortgage loans;

 

iii.Consumer loans; and

 

iv.Contingent loans.

 

ECL allowance calculated on an Individual basis:

 

For financial assets in the corporate portfolio that are (a) credit-impaired at the reporting date (classified in stage 3 with a PD equal to 100%), and (b) is individually significant, the Bank calculates allowance for expected credit losses on an individual basis by using a “Cash flow discounted Methodology”. In this instance, the Bank measures the expected credit losses as the difference between the asset’s gross carrying amount and the present value of estimated future cash flows discounted at the financial asset’s original effective interest rate. Any adjustment is recognised in profit or loss as an impairment gain or loss. The allowances determined under a “Discounted Cash Flow Methodology” must take into account the financial information of the debtor, including available business strategies, as well as collateral associated with that debtor. The recovery analysis includes the following scenarios:

 

-Recovery of a possible sale of collateral.

 

-Recovery on the basis of common commercial activities (commercial plan).

 

F-25

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

ECL allowance calculated on a collective basis:

 

Commercial loans (except for those described within the “ECL allowance calculated on an Individual basis” description aforementioned), mortgage loans and consumer loans are grouped and assessed on a collective basis by using a credit loss allowance model. The estimation of the collective basis expected credit loss allowance considers qualitative and quantitative information that may affect the changes in credit risk and the development of significant assumptions related to the probabilities of default and loss given default, related to forward looking information, multi-factor analysis such as type of portfolio or transaction and macroeconomic factors. See Note 37 Risk Management - f) Measurement of expected credit losses.

 

Contingent loans

 

The Bank has established several irrevocable loan commitments and contingent liabilities. Even though these obligations may not be recognised on the statements 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 loans, it estimates the expected portion of the loan commitment that will be drawn down over its expected life.

 

i.Forward looking information

 

The ECL model includes a broad range of forward-looking information as economic inputs, such as:

 

Chilean Central Bank interest rates

 

Unemployment rates

 

Housing price growth

 

GDP growth

 

Consumer price index

 

See Note 37 Risk management – i) Macro economical forward-looking information.

 

ii.Modifications of financial assets

 

When loan measured at amortised cost has been renegotiated or modified but not derecognised, the Bank recognises the resulting gains or losses as the difference between the carrying amount of the original loans and modified contractual cash flows discounted using the EIR before modification.

 

For ECL estimation purposes on financial assets that have been modified, is required to distinguish between modification that result in derecognition from those that does not result in derecognition. If the modification does not result in derecognition, then the subsequent assessment of whether there is a significant increase in credit risk is made comparing the risk at the reporting date based on the modified contractual term and the risk at initial recognition based on the original, unmodified contractual term. If the modification results in derecognition, then the modified asset is considered to be a new asset, and the modification’s date is origination date for impairment purposes.

 

According to current definitions, contractual modifications generate new operations.

 

iii.Collateral

 

The Banks seeks to use collateral to mitigate its credit risks on financial assets, where possible. Types of collateral are: cash, securities, letters of credit, real estate and inventories. Collateral, unless repossessed, is not recorded on the Bank’s statements of financial position. However, the fair value of collateral affects the calculation of ECLs. The main collateral associated to mortgage loans are real estate, which are valued based on data provided by specialized third parties.

 

The estimation of ECL reflects the cash flows expected from collateral and other credit enhancement that are part of the contractual terms of the financial instruments.

 

According to the Bank’s policy when assets are repossessed they are transferred to assets held for sale at their fair value less cost to sell as non-financial assets at the repossession date.

 

F-26

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

iv.Write-offs

 

The gross carrying amount of a financial asset is reduced when there is no reasonable expectation of recovery. A write-off constitutes a derecognition event of the corresponding loan transaction in its entirety, and therefore, include portions not past-due for installments loans or leasing operation (no partial write-off).

 

Subsequent recoveries of amounts previously written-off are credited to the income statements, as recovery of loans previously write-off, as a deduction from provisions for loan losses.

 

Loan and accounts receivable write-offs are recorded for overdue and current installments based on the time periods expired since reaching overdue status, as described below:

 

Type of loan  Term
Consumer loans with or without collateral  6 months
Other transactions without collateral  24 months
Commercial loans with collateral  36 months
Mortgage loans  48 months
Consumer leasing  6 months
Other non-mortgage leasing transactions  12 months
Mortgage leasing (household and business)  36 months

 

q.Provisions, contingent assets and contingent liabilities

 

Provisions are liabilities of uncertain timing or amount. Provisions are recognised in the Consolidated Statements of Financial Position when the Bank:

 

i.has a present obligation (legal or constructive) as a result of past events, and

 

ii.it is probable that an outflow of resources will be required to settle these obligations and the amount of these resources can be reliably measured.

 

Contingent assets or contingent liabilities are any potential rights or obligations arising from past events whose existence will be confirmed only by the occurrence or non-occurrence if one or more uncertain future events that are not wholly within control of the Bank.

 

The Consolidated Statements of Financial Position and annual accounts reflect all significant provisions for which it is estimated that it is probable an outflow of resources will be required to meet the obligation where the probability of having to meet the obligation is more likely than not. Provisions are quantified using the best available information on the consequences of the event giving rise to them and are reviewed and adjusted at the end of each year. Provisions must specify the liabilities for which they were originally recognised. Partial or total reversals are recognised when such liabilities cease to exist or are reduced.

 

Provisions are classified according to the obligation covered as follows:

 

-Provision for employee salaries and expenses

 

-Provision for mandatory dividends

 

-Provision for contingent credit risks
   
-Provisions for contingencies

 

r.Deferred income taxes and other deferred taxes

 

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.

 

s.Use of estimates

 

The preparation of the financial statements requires the Bank’s management to make estimates and assumptions that affect the application of the accounting policies and the reported balances of assets, liabilities, revenues and expenses. Actual results may differ from these estimates.

 

F-27

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

In certain cases, International Financial Reporting Standards (IFRS) require that assets or liabilities be recorded or disclosed at their fair values. The fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When available, quoted market prices in active markets have been used as the basis for measurement. When quoted market prices in active markets are not available, the Bank has estimated such values based on the best information available, including the use of modeling and other valuation techniques.

 

Bank has established allowances to cover credit losses. These allowances must be regularly reviewed taking into consideration factors such as changes in the nature and volume of the loan portfolio, trends in forecasted portfolio quality, credit quality and economic conditions that may adversely affect the borrowers’ ability to pay. Increases in the allowances for loan losses are reflected as “Provision for loan losses” in the Consolidated Statements of Income. Loans are charged-off when the Bank’s management determines that a loan or a portion thereof is impaired. Charge-offs are recorded as a reduction of the allowance for loan losses.

 

The relevant estimates and assumptions made to calculate provisions are regularly reviewed by the Bank’s Management to quantify certain assets, liabilities, revenues, expenses, and commitments.

 

These estimates, made on the basis of the best available information, mainly refer to:

 

-Allowances for loan losses

 

-Impairment losses of certain assets

 

-The useful lives of tangible and intangible assets

 

-The fair value of assets and liabilities

 

-Commitments and contingencies

 

-Current and deferred taxes

 

t.Non-current assets held for sale

 

The requirements established in IFRS 5 to classify assets (or disposal group) as held for sale are the following:

 

the assets are available for immediate sale in its present conditions and its sale must be highly probable.

 

for the sale to be highly probable, the appropriate level of management is committed to a plan to sell the asset, and an active programme to locate a buyer and complete the plan.

 

additionally, the sale should be expected to qualify for recognition as a completed sale within one year from the date of classification.

 

An entity shall measure a non-current asset (or disposal group) classified as held for sale at the lower of its carrying amount and fair value less sale cost.

 

Events or circumstances may extend the period to complete the sale beyond one year. An extension of the period required to complete a sale does not preclude an asset from being classified as held for sale if the delay is caused by events or circumstances beyond the entity’s control and there is sufficient evidence that the entity remains committed to its plan to sell the asset.

 

Assets received or awarded in lieu of payment

 

Assets received or awarded in lieu of payment of loans and accounts receivable from clients are recognised at their fair value (as determined by an independent appraisal). A price is agreed upon by the parties through negotiation or, when the parties do not reach an agreement, at the amount at which the Bank is awarded those assets at a judicial auction. In the both cases, an independent appraisal is performed. The excess of the outstanding loan balance over the fair value is charged to net income for the period, under “Provision for loan losses”. Any excess of the fair value over the outstanding loan balance, less costs to sell of the collateral, is returned to the client. These assets are subsequently adjusted to their net realizable value less cost to sale (assuming a forced sale).

 

The difference between the carrying value of the asset and the estimated fair value less costs to sell is charged to net income for the period, under “Other operating expenses”. The result obtained in the sale of the asset is subsequently recorded under “Other operating income”.

 

Independent appraisals are obtained at least every 18 months and fair values are adjusted accordingly. No adjustments have been made between appraisals with respect to the period covered by these financial statements considering the stability of the real estate market in Chile during past years and expected stability of the real estate market in the coming years.

 

F-28

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

At least once a year, the Bank performs the necessary analysis to update the “cost to sale” of assets received or awarded in lieu of payments. According to the Bank’s survey, as of December 31, 2023 the average cost to sale was estimated at 5.67% of the appraisal value (5.8% as of December 31, 2022).

 

u.Earnings per share

 

Basic earnings per share are determined by dividing the net income attributable to the shareholders of the Bank for the reported period by the weighted average number of shares outstanding during the reported period.

 

Diluted earnings per share are determined in the same way as basic earnings, but the weighted average number of outstanding shares is adjusted to take into consideration the potential diluting effect of stock options, warrants, and convertible debt.

As of December 31, 2023, 2022 and 2021 the Bank did not have any instruments that generated dilution.

 

v.Temporary acquisition (assignment) of assets and liabilities

 

Purchases or sales of financial assets under non-optional repurchase agreements at a fixed price are recorded in the Consolidated Statements of Financial Position based on the nature of the debtor (creditor) under “Deposits in the Central Bank of Chile,” “Deposits in financial institutions” or “Loans and accounts receivable from customers” (“Central Bank of Chile deposits,” “Deposits from financial institutions” or “Customer deposits”), in Note 7.

 

Differences between the purchase and sale prices are recorded as financial interest over the term of the contract.

 

w.Provision for mandatory dividends

 

As of December 31, 2023, 2022 and 2021 the Bank recorded a provision for mandatory dividends. This provision is made pursuant to Article 79 of the Corporations Act, which is in accordance with the Bank’s internal policy, pursuant to which at least 30% of net income for the period is distributed, except in the case of a contrary resolution adopted at the respective shareholders’ meeting by unanimous vote of the outstanding shares. This provision is recorded, as a deducting item, under the “Retained earnings – provision for mandatory dividends” line of the Consolidated Statements of Changes in Equity with offset to Provisions.

 

x.Employee benefits

 

i.Post-employment benefits – Defined Benefit Plan:

 

According to current collective labor agreements and other agreements, the Bank has an additional benefit available to its principal executives, consisting of a pension plan whose purpose is to endow them with funds for a better supplementary pension upon their retirement.

 

Features of the Plan:

 

The main features of the Post-Employment Benefits Plan promoted by the Banco Santander-Chile are:

 

a.Aimed at the Bank’s management.

 

b.The general requirement to apply for this benefit is that the employee must be carrying out his/her duties when turning 60 years old.

 

c.The Bank will create a pension fund, with life insurance, for each beneficiary in the plan. Periodic contributions into this fund are made by the manager and matched by the Bank.

 

d.The Bank will be responsible for granting the benefits directly.

 

The Bank uses the method of projected unit credit, to determine the present value of the defined benefit obligation and the current service cost.

 

Components of defined benefit cost include:

 

i.current service cost and any past service cost, which are recognised in profit or loss for the period;

 

ii.net interest on the liability (asset) for net defined benefit, which is recognised in profit or loss for the period;

 

iii.new liability (asset) remeasurements for net defined benefit include:

 

a.actuarial gains and losses;

 

b.the difference between the actual return on plan assets and the interest on plan assets included in the net interest component and;

 

c.changes in the effect of the asset ceiling.

 

F-29

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

The liability (asset) for net defined benefit is the deficit or surplus, determined as the difference between the present value of the defined benefit obligation less the fair value of plan assets.

 

Plan assets comprise the pension fund taken out by the Group with a third party that is not a related party. These assets are held by an entity legally separated from the Bank and exist solely to pay benefits to employees.

The Bank recognises the present service cost and the net interest of the Personnel salaries and expenses on the Consolidated Statements of Income.

 

The post-employment benefits liability, recognised in the Consolidated Statements of Financial Position represents the deficit or surplus in the defined benefit plans of the Bank. Any surplus resulting from the calculation is limited to the present value of any economic benefits available in the form of refunds from the plan or reductions in future contributions.

 

When employees leave the plan before meeting the requirements to be eligible for the benefit, contributions made by the Bank are reduced.

 

ii.Cash-settled share-based compensation

 

The Bank allocates cash-settled share-based compensation to executives of the Bank and its Subsidiaries in accordance with IFRS 2. The Bank measures the services received and the obligation incurred at fair value. Until the obligation is settled, the Bank determines the fair value at the end of each reporting period, as well as at the date of settlement, recognising any change in fair value in the income statements of the period.

 

y.Application of new and revised International Financial Reporting Standards

 

1. New and revised standards effective in current year

 

The following new and revised IFRS have been adopted in these financial statements:

 

Amendments to IAS 1 - Classification of liabilities as current or non-current. Issued on January 23, 2020, this amendment to provide a general approach to the classification of liabilities under IAS 1 based on the contractual arrangements in place at the reporting date. The amendments affect only the presentation of liabilities in the statement of financial position — not the amount or timing of recognition of any asset, liability income or expenses, or the information that entities disclose about those items. The Amendments:

 

clarify that the classification of liabilities should be based on rights that are in existence at the end of the reporting period and align the wording in all affected paragraphs to refer to the “right” to defer settlement by at least twelve months and make explicit that only rights in place “at the end of the reporting period” should affect the classification of a liability;

 

clarify that classification is unaffected by expectations about whether an entity will exercise its right to defer settlement of a liability; and

 

make clear that settlement refers to the transfer to the counterparty of cash, equity instruments, other assets or services.

 

The amendments are effective for annual reporting periods beginning on or after January 1, 2023 and are to be applied retrospectively. Earlier application is permitted. This amendments has no impact on the presentation of the Bank’s Consolidated Financial Statements.

 

Amendments to IAS 8 - Definition of Accounting estimates. Issued on February 12, 2021, these amendments help entities to distinguish between accounting policies and accounting estimates. The changes to IAS 8 focus entirely on accounting estimates and clarify the following:

 

The definition of a change in accounting estimates is replaced with a definition of accounting estimates. Under the new definition, accounting estimates are “monetary amounts in financial statements that are subject to measurement uncertainty”.

 

Entities develop accounting estimates if accounting policies require items in financial statements to be measured in a way that involves measurement uncertainty.

 

The Board clarifies that a change in accounting estimate that results from new information or new developments is not the correction of an error. In addition, the effects of a change in an input or a measurement technique used to develop an accounting estimate are changes in accounting estimates if they do not result from the correction of prior period errors.

 

A change in an accounting estimate may affect only the current period’s profit or loss, or the profit or loss of both the current period and future periods. The effect of the change relating to the current period is recognised as income or expense in the current period. The effect, if any, on future periods is recognised as income or expense in those future periods.

 

F-30

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

The amendments were effective for annual periods beginning on or after 1 January 2023 and changes in accounting policies and changes in accounting estimates that occur on or after the start of that period. Earlier application is permitted. This amendments has no impact on the presentation of the Bank’s Consolidated Financial Statements.

 

Amendments to IAS 1 and IFRS Practice Statement 2 - Disclosure of Accounting Policies. Issued on February 12, 2021, these amendments intended to help preparers in deciding which accounting policies to disclose in their financial statements. Disclosure of Accounting Policies amends IAS 1 in the following ways:

An entity is now required to disclose its material accounting policy information instead of its significant accounting policies;

 

-several paragraphs are added to explain how an entity can identify material accounting policy information and to give examples of when accounting policy information is likely to be material;

 

-the amendments clarify that accounting policy information may be material because of its nature, even if the related amounts are immaterial; the amendments clarify that accounting policy information is material if users of an entity’s financial statements would need it to understand other material information in the financial statements; and

 

-the amendments clarify that if an entity discloses immaterial accounting policy information, such information shall not obscure material accounting policy information.

  

In addition, IFRS Practice Statement 2 has been amended by adding guidance and examples to explain and demonstrate the application of the ‘four-step materiality process’ to accounting policy information in order to support the amendments to IAS 1.

The amendments are applied prospectively. The amendments to IAS 1 were effective for annual periods beginning on or after January 1, 2023. Earlier application is permitted. Once the entity applies the amendments to IAS 1, it is also permitted to apply the amendments to IFRS Practice Statement 2. The Bank’s management has reviewed its disclosures under these regulations, resulting in no material modifications.

 

Deferred Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12). Issued on May 7, 2021, to clarify how companies account for deferred tax on transactions such as leases (when a lessee recognises an asset and a liability at the lease commencement) and decommissioning obligations (when an entity recognises a liability and includes the decommissioning costs in the cost of the item of property, plant and equipment).

 

The main change in Deferred Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12) is an exemption from the initial recognition exemption provided in IAS 12.15(b) and IAS 12.24. Accordingly, the initial recognition exemption does not apply to transactions in which equal amounts of deductible and taxable temporary differences arise on initial recognition. This is also explained in the newly inserted paragraph IAS 12.22A. The amendments are effective for annual reporting periods beginning on or after January 1, 2023. Early adoption is permitted. The Bank’s management has implemented this amendments in the consolidated financial statements of the Bank.

 

Initial Application of IFRS 17 and IFRS 9—Comparative Information. Issued on December 9, 2021, the main amendment is a narrow-scope amendment to the transition requirements of IFRS 17 for entities that first apply IFRS 17 and IFRS 9 at the same time. The amendment regards financial assets for which comparative information is presented on initial application of IFRS 17 and IFRS 9, but where this information has not been restated for IFRS 9. Under the amendment, an entity is permitted to present comparative information about a financial asset as if the classification and measurement requirements of IFRS 9 had been applied to that financial asset before. The option is available on an instrument-by-instrument basis. In applying the classification overlay to a financial asset, an entity is not required to apply the impairment requirements of IFRS 9. There are no changes to the transition requirements in IFRS 9. This amendments has no impact on the presentation of the Bank’s Consolidated Financial Statements..

 

International Tax Reform—Pillar Two Model Rules (Amendments to IAS 12). Issued on May 23,2023, The amendments introduce an exception to the requirements in the standard that an entity does not recognise and does not disclose information about deferred tax assets and liabilities related to the OECD pillar two income taxes; an entity applies the exception and the requirement to disclose that it has applied the exception immediately upon issuance of the amendments; the remaining disclosure requirements are required for annual reporting periods beginning on or after 1 January 2023. This standard has no impact on the presentation of the Bank’s Consolidated Financial Statements.

 

F-31

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 01 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, continued

 

2. New and revised IFRS issued but not effective

 

As of the closing date of these financial statements, new International Financial Reporting Standards had been published as well as interpretations of them, which were not mandatory as of December 31, 2023. Although in some cases the early application is permitted by the IASB, the Bank has not taken that option.

 

Amendments to IFRS 16 – Lease liability in a sale and leaseback. Issued on September 22, 2022, these amendments requires a seller-lessee to subsequently measure lease liabilities arising from a leaseback in a way that it does not recognise any amount of the gain or loss that relates to the right of use it retains. The new requirements do not prevent a seller-lessee from recognising in profit or loss any gain or loss relating to the partial or full termination of a lease. The amendments are effective for annual reporting periods beginning on or after 1 January 2024. Earlier application is permitted. The Bank’s Administration is evaluating the potential effects of this modification.

 

Amendments to IAS 1 – Non-current liabilities with covenants. Issued on October 21, 2022, these amendments modify the requirements introduced by Classification of Liabilities as Current or Non-current on how an entity classifies debt and other financial liabilities as current or non-current in particular circumstances: Only covenants with which an entity is required to comply on or before the reporting date affect the classification of a liability as current or non-current. In addition, an entity has to disclose information in the notes that enables users of financial statements to understand the risk that non-current liabilities with covenants could become repayable within twelve months. The amendments are effective for reporting periods beginning on or after 1 January 2024. The amendments are applied retrospectively in accordance with IAS 8 and earlier application is permitted. The Bank’s Administration is evaluating the potential effects of this modification.

 

Amendments to IAS 7 and IFRS 7 - Supplier Finance Arrangements. Issued on May 25, 2023, the amendments require that an entity shall disclose information about its supplier finance arrangements that enables users of financial statements to assess the effects of those arrangements on the entity’s liabilities and cash flows and on the entity’s exposure to liquidity risk.

 

An entity applies the amendments to IAS 7 for annual reporting periods beginning on or after 1 January 2024 (with earlier application permitted) and the amendments to IFRS 7 when it applies the amendments to IAS 7. The Bank’s Administration is evaluating the potential effects of this modification.

 

Amendments to IAS 21 – Lack of exchangeability. Issued on August 15, 2023, the amendments includes:

 

1.Specify when a currency is exchangeable into another currency and when it is not.

 

2.Specify how an entity determines the exchange rate to apply when a currency is not exchangeable

 

3.Require the disclosure of additional information when a currency is not exchangeable

 

The pronouncement also includes a new appendix with application guidance on exchangeability and a new illustrative example. The amendments also extend to conforming amendments to IFRS 1 which previously referred to, but did not define, exchangeability. An entity applies the amendments for annual reporting periods beginning on or after 1 January 2025. Earlier application is permitted. The Bank’s Administration is evaluating the potential effects of this modification.

 

F-32

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 02 - SIGNIFICANT EVENTS

 

As of December 31, 2023, the following significant events have occurred and affected the Bank’s operation and Consolidated Financial Statements.

 

a.The Board

 

At the Ordinary Board of Director’s meeting held on March 28, 2023, the members agreed to summon an Ordinary Shareholders Meeting scheduled for April 19, 2023 with the aim to propose a distribution of profits and payment of dividends equivalent to 60% of the retained earnings as of December 31, 2022 equivalent to $ 2.57469221 per share and to propose that the remaining 40% of the profits be destined to increase the Bank’s reserves. Hence, the Bank has accounting minimum dividend of 60% of the 2022 retained earnings.

 

Additionally, the resignation of the Alternate Director Oscar Von Chrismar was announced, and Maria Olivia Recart Herrera was appointed to replace him.

 

b.Shareholders’ meeting

 

At the Ordinary Shareholders’ Meeting of Banco Santander-Chile held on April 19, 2023, along with the approval of the Consolidated Financial Statements for 2022, the shareholders agreed to distribute 60% of the net profits for the year (“Profit attributable to equity holders of the Bank”), which amounted to $485,191 million. Those profits represent a dividend of $2.57469221 Chilean pesos for each share. In addition, the Board approved that the remaining 40% was allocated to increase the Bank’s reserves.

 

Moreover, Claudio Melandri Hinojosa (president), Rodrigo Vergara Montes (independent), Orlando Poblete Iturrate (independent), Felix de Vicente Mingo (independent), Maria Olivia Recart Herrera (independent), Ana Dorrego de Carlos, Rodrigo Echenique, Lucia Santa Cruz Sutil, Blanca Bustamante Bravo (independiente) were elected as regular directors, and as substitute directors Juan Pedro Santa Maria Perez (independent) and Alfonso Gómez Morales (independent).

 

Furthermore, the members also approved PricewaterhouseCoopers Consultores Auditores SpA as external auditors for the 2023 financial year.

 

c.Related entities

 

On April 5, 2023, at the extraordinary Shareholders meeting of Getnet, Mr. Carlos Alfredo Rocca Vidal resigned from the position of General Manager of the Company and Mr. Fernando Benito was appointed as the new General Manager unanimously.

 

In 2023, the company PagoNxt Trade Chile SpA was incorporated in Chile, whose sole shareholder is PagoNxt Trade S.L, domiciled in Spain. Since July 2023, PagoNxt Trade Chile SpA was consolidated into financial statements of Banco Santander Chile based on the new company´s relevant activities are determined by the Bank and, therefore, the Bank exercises control.

 

On July 25, 2023, the shareholders of Santander Corredora de Seguros Limitada approved the reduction of its share capital in the sum of $19,578,714,679, thus, the effective share capital as of August 30, 2023 was $12,304,220,013. This capital reduction did not mean a change in the percentages of shareholders’ participation.

 

On August 21, 2023, the shareholders of Santander Corredora de Seguros Limitada agreed to distribute the company’s accumulated profits in the amount of 50,323,708,868 Chilean pesos.

 

On October 5, 2023, the shareholders of Santander Asesorias Fiancieras agrred to distribute the company’s accumulated profits in the amount of 19,058,866,145 Chilean pesos, the effective payment distribution was made on October 11, 2023. On the same date, the company made a capital decrease for an amount of Th$38,499,134 distributed among its shareholders, according to their participation.

 

d.Bonds issued

 

Senior bonds

 

As of December 31, 2023 the Bank has registered senior bonds for an amount of CLP 750,000,000,000 and UF 21,000,000. The debt issuance information is included in Note 17.

 

F-33

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 02 - SIGNIFICANT EVENTS, continued

 

Series  Currency  Term
(annual)
  Issuance rate
(annual)
   Placement
date
  Amount  

Maturity

date

AA1  CLP  6 years   6.60%  12-01-2022   100,000,000,000   12-01-2028
AA2  CLP  6.5 years   6.20%  12-01-2022   100,000,000,000   06-01-2029
AA3  CLP  8 years   6.20%  09-01-2022   100,000,000,000   09-01-2030
AA4  CLP  10.5 years   6.25%  09-01-2022   100,000,000,000   03-01-2033
AA5  UF  9.5 years   2.95%  08-01-2022   10,000,000   02-01-2032
AA6  UF  15 years   2.70%  10-01-2022   5,000,000   10-01-2037
AA7  CLP  3.5 years   6.80%  02-01-2023   75,000,000,000   08-01-2026
AA8  CLP  4.5 years   6.70%  03-31-2023   100,000,000,000   09-01-2027
AA9  CLP  8 years   6.30%  03-31-2023   75,000,000,000   11-01-2030
AA10  CLP  8 years   7.10%  04-24-2023   50,000,000,000   03-01-2026
AA11  CLP  3 years   6.40%  07-01-2023   50,000,000,000   07-012026
AA12  UF  10 years   3.40%  09-01-2023   3,000,000   03-01-2033
AA13  UF  6 years   3.40%  09-01-2023   3,000,000   09-01-2029

 

On October 20, 2023, the Bank issued a green bond in the Japanesee market, with settlement date on October 27, 2023 –through the Bank’s EMTN program – for JPY8,000,000,000 with maturity on October 27, 2025 at 0.845% interest rate.

 

e.Others

 

Transbank

 

The Ministry of Finance together with the Association of Banks and Financial Institutions (ABIF) announced that the shareholder banks of Transbank began a process of selling their shareholding in that company, within the new framework of the payment system (four-part model). The Shareholders has defined JPMorgan as the advisory bank in the disposal. Up to now, there is no buyer for this sale.

 

MPR

 

On July 28, 2023, after 8 months maintaining Monetary Policy Rate (MPR) the Chilean Central Bank decreased the rate by 100 basis points, from 11.25% to 10.15%. Subsequently, on September 4, the Chilean Central Bank made a new decrease in the MPR, to 9.50%. At the end of December the MPR was 8.25%.

 

Chilean Central Bank – liquidity deposits

 

On September 26, 2023, the Council of the Central Bank of Chile established a special program that consists of the issuance of liquidity deposit certificates in national currency (PDL), with the exclusive purpose of guaranteeing and operationally supporting the payment of the Financing Facility Conditional on Increased Loans (FCIC). On October 13, 2023, the CMF issued a communication instructing the accounting treatment of these PDLs, which must be registered as Financial Debt Instruments, within the category of financial assets at amortized cost. As of December 31, 2023, the Bank has invested Ch$3,392,609 million in this type of instruments.

 

Interchanges fees

 

Since October 1, 2023, the first reduction of the interchange rates limits began, as per was agreed by the Committee for Setting Limits on Exchange Rates in last February and published on April, 26, 2023 at the Official Journal. The maximum rates will be 0.5% for debit cards, 1.14% for credit cards, and 0.94% for cards with provision of funds.

 

F-34

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 03 - REPORTING SEGMENTS

 

The Bank manages and measures the performance of its operations by business segments. The information disclosed in this note is not necessarily comparable to that of other financial institutions, since it is based on management’s internal information system by segment.

 

Inter-segment transactions are conducted under normal arm’s length commercial terms and conditions. Each segment’s assets, liabilities, and income include items directly attributable to the segment to which they can be allocated on a reasonable basis.

 

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, are homogenous services based on IFRS 8 aggregation criteria, thus they form part of the same reporting segment. 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 has the reportable segments noted below:

 

Retail Banking

 

Consists of individuals and small to middle-sized entities (SMEs) with annual income less than Ch$3,000 million. This segment gives customers a variety of services, including consumer loans, credit cards, automobile loans, commercial loans, foreign exchange, mortgage loans, debit cards, checking accounts, savings products, mutual funds, stockbrokerage, and insurance brokerage. Additionally, the SME clients are offered government-guaranteed loans, leasing and factoring.

 

Middle-market

 

This segment is made up of companies and large corporations with annual sales exceeding Ch$3,000 million. It serves institutions such as universities, government entities, local and regional governments and companies engaged in the real estate industry who carry out projects to sell properties to third parties and annual sales exceeding Ch$800 million with no upper limit. The companies within this segment have access to many products including commercial loans, leasing, factoring, foreign trade, credit cards, mortgage loans, checking accounts, transactional services, treasury services, financial consulting, savings products, mutual funds, and insurance brokerage. Also companies in the real estate industry are offered specialized services to finance projects, chiefly residential, with the aim of expanding sales of mortgage loans.

 

Corporate & Investment Banking (CIB)

 

This segment consists of foreign and domestic multinational companies with sales over Ch$10,000 million. The companies within this segment have access to many products including commercial loans, leasing, factoring, foreign trade, credit cards, mortgage loans, checking accounts, transactional services, treasury services, financial consulting, investments, savings products, mutual funds and insurance brokerage.

 

This segment also consists of a Treasury Division which provides sophisticated financial products, mainly to companies in the Middle-market and Global Investment Banking segments. These include products such as short-term financing and fund raising, brokerage services, derivatives, securitization, and other tailor-made products, The Treasury area may act as brokers to transactions and also manages the Bank’s investment portfolio.

 

Corporate Activities (“Other”)

 

This segment mainly includes the results of our Financial Management Division, which develops global management functions, including managing inflation rate risk, foreign currency gaps, interest rate risk and liquidity risk. Liquidity risk is managed mainly through wholesale deposits, debt issuances and the Bank’s available for sale portfolio. This segment also manages capital allocation by unit. These activities usually result in a negative contribution to income.

 

F-35

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 03 - REPORTING SEGMENTS, continued

 

In addition, this segment encompasses all the intra-segment income and all the activities not assigned to a given segment or product with customers.

 

The segments’ accounting policies are those described in the summary of accounting policies, 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 assessment on the segment’s interest income, fee and commission income, and expenses.

 

Below are the tables showing the Bank’s results by reporting segment for the years ended December 31, 2023, 2022 and 2021 in addition to the corresponding balances of loans and accounts receivable from customers:

 

           For the year ended December 31, 2023 
  

Loans and
accounts
receivable
from
customers (1)

  

Deposits
and other
demand
deposits (2)

   Net
interest
income
   Net fee and
commission
income
  

Net income
from
financial
operations

   Provision
for loan
losses
  

Support
expenses (3)

   Segment’s
net
contribution
 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Retail Banking   29,066,792    13,896,076    1,381,014    376,643    45,573    (295,221)   (661,901)   846,108 
Middle-market   8,774,343    5,513,939    459,256    64,964    29,611    (37,515)   (106,851)   409,465 
CIB   3,077,491    8,256,291    248,381    50,457    185,617    10,418    (95,914)   398,959 
Other   (106,740)   2,009,462    (995,602)   10,576    41,654    (467)   (11,482)   (955,321)
Total   40,811,886    29,675,768    1,093,049    502,640    302,455    (322,785)   (876,148)   699,211 
                                         
Other operating income                         3,807 
Other operating expenses and impairment                        (33,550)
Net income from non-current assets and groups available for sale not admissible as discontinued operations    13,154 
Income from investments in associates and other companies                  8,763 
Result of continuing operations before income taxes              691,385 
Income tax expense                    (97,548)
Result of discontinued operations before income taxes                        
-
 
Income tax expense                   
-
 
Net income for the year                        593,837 

 

(1)Corresponds to loans and accounts receivable and Interbank at amortised cost, without deducting their allowances for loan losses.
(2)Corresponds to Deposits and other demand liabilities and Time deposits and other time liabilities.
(3)Corresponds to the sum of personnel salaries and expenses, administrative expenses, depreciation and amortisation.

 

F-36

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 03 - REPORTING SEGMENTS, continued

 

           For the year ended December 31, 2022 
  

Loans and
accounts
receivable
from
customers (1)

  

Deposits
and other
demand
deposits (2)

   Net
interest
income
   Net fee and
commission
income
  

Net income
from
financial
operations

   Provision
for loan
losses
  

Support
expenses (3)

   Segment’s
net
contribution
 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Retail Banking   27,081,897    13,553,898    1,129,553    312,706    34,721    (290,184)   (635,991)   550,905 
Middle-market   8,641,652    6,110,529    389,297    62,644    22,979    (57,253)   (105,160)   312,507 
CIB   2,978,420    6,636,113    143,575    37,300    157,793    (8,082)   (91,926)   238,660 
Other   27,432    764,476    (92,313)   (5,381)   1,685    (1,075)   (21,943)   (119,027)
Total   38,729,401    27,065,016    1,570,112    407,269    217,178    (356,494)   (855,020)   983,045 
                                         
Other operating income                             5,539 
Other operating expenses                            (106,306)
Net income from non-current assets and groups available for sale not admissible as discontinued operations    8,518 
Income from investments in associates and other companies                  10,310 
Result of continuing operations before income taxes                       901,106 
Income tax expense                        (93,624)
Result of discontinued operations before income taxes                   
-
 
Income tax expense                        
-
 
Net income for the year                        807,482 

 

F-37

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 03 - REPORTING SEGMENTS, continued

 

           For the year ended December 31, 2021 
  

Loans and
accounts
receivable
from
customers (1)

  

Deposits
and other
demand
deposits (2)

   Net
interest
income
   Net fee and
commission
income
  

Net income
from
financial
operations

   Provision
for loan
losses
  

Support
expenses (3)

   Segment’s
net
contribution
 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Retail Banking   25,784,719    14,779,739    1,035,288    270,750    36,286    (239,885)   (616,287)   486,152 
Middle-market   8,511,500    6,185,189    327,519    49,545    18,001    (53,281)   (94,721)   247,063 
CIB   2,154,325    6,010,150    96,388    31,027    112,576    2,884    (77,051)   165,824 
Other   78,518    1,056,915    335,579    (1,994)   -47,835    (946)   (11,805)   272,999 
Total   36,529,062    28,031,993    1,794,774    349,328    119,028    (291,228)   (799,864)   1,172,038 
                                         
Other operating income                                  1,662 
Other operating expenses                                (101,430)
Net income from non-current assets and groups available for sale not admissible as discontinued operations    2,297 
Income from investments in associates and other companies                  (475)
Result of continuing operations before income taxes                        1,074,092 
Income tax expense                        (221,664)
Result of discontinued operations before income taxes                       
-
 
Income tax expense                       
-
 
Net income for the year                       852,428 

 

(1)Corresponds to loans and accounts receivable and Interbank at amortised cost, without deducting their allowances for loan losses.
(2)Corresponds to Deposits and other demand liabilities and Time deposits and other time liabilities.
(3)Corresponds to the sum of personnel salaries and expenses, administrative expenses, depreciation and amortisation.

 

F-38

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 04 - CASH AND CASH EQUIVALENTS

 

a.The detail of the balances included under cash and cash equivalents is as follows:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Cash and deposits in banks        
Cash   1,198,568    1,110,830 
Deposits at the Central Bank of Chile   654,883    444,491 
Deposits in local banks   1,128    2,646 
Deposits in banks abroad   868,703    424,975 
Subtotals – Cash and deposits in banks   2,723,282    1,982,942 
           
Net cash items in process of collection   37,442    96,944 
Cash and cash equivalents   2,760,724    2,079,886 

 

The balance of funds held in cash and at the Central Bank of Chile reflects the monthly average that the Bank must maintain in accordance with the regulations governing minimum reserves although the balance can be withdrawn on demand.

 

b.Cash in process of collection and in process of being cleared:

 

Cash items in process of collection and in process of being cleared represent domestic transactions which have not been processed through the central domestic clearinghouse or international transactions which may be delayed in settlement due to timing differences. These transactions were as follows:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Assets        
Documents held by other banks (documents to be cleared)   85,467    93,650 
Funds receivable   727,057    750,166 
Subtotal   812,524    843,816 
Liabilities          
Funds payable   (775,082)   (746,872)
Subtotal   (775,082)   (746,872)
           
Cash in process of collection, net   37,442    96,944 

 

F-39

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 05 - FINANCIAL ASSETS FOR TRADING AT FAIR VALUE TRHOUGH PROFIT AND LOSS

 

The detail of financial assets for trading at fair value through profit and loss is as follows:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Financial derivative contracts        
Forwards   1,262,688    1,669,807 
Swaps   8,848,051    9,992,123 
Call currency options   4,100    1,429 
Put currency options   4,647    9,601 
Subtotal   10,119,486    11,672,960 
Debt financial instruments          
Chilean Central Bank and Government securities   98,308    153,967 
Foreign financial debt securities   
-
    79 
Subtotal   98,308    154,046 
           
Total   10,217,794    11,827,006 

 

a.As of December 31, 2023 and 2022 the Bank holds the following portfolio of financial assets derivative contracts:

 

   As of December 31, 2023 
   Notional amount 
   Demand   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   Fair value 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Currency forward   
-
    15,867,609    12,888,002    14,222,043    4,911,114    684,394    1,086,568    49,659,730    1,262,688 
Interest rate swaps   
-
    5,619,676    18,456,733    20,257,077    18,590,489    7,833,406    14,063,652    84,821,033    2,342,464 
Cross currency swaps   
-
    1,960,833    4,433,903    17,189,757    41,659,348    18,501,221    44,664,446    128,409,508    6,505,587 
Call currency options   
-
    44,358    100,886    84,331    
-
    
-
    
-
    229,575    4,100 
Put currency options   
-
    212,940    114,990    54,949    6,558    
-
    
-
    389,437    4,647 
Total   
-
    23,705,416    35,994,514    51,808,157    65,167,509    27,019,021    59,814,666    263,509,283    10,119,486 

 

       As of December 31, 2022 
       Notional amount 
   Demand   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   Fair value 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Currency forward   
       -
    9,245,832    7,653,539    9,828,036    6,178,376    1,009,395    737,202    34,652,380    1,669,807 
Interest rate swaps   
       -
    5,583,353    8,796,596    26,246,111    24,855,247    11,658,182    16,373,617    93,513,106    4,283,817 
Cross currency swaps   
       -
    1,258,796    1,575,109    5,398,185    19,811,336    11,689,202    21,297,126    61,029,754    5,708,306 
Call currency options   
       -
    99,157    80,844    24,744    
-
    
-
    
-
    204,745    1,429 
Put currency options   
       -
    309,713    1,699    7,816    
-
    
-
    
-
    319,228    9,601 
Total   
       -
    16,496,851    18,107,787    41,504,892    50,844,959    24,356,779    38,407,945    189,719,213    11,672,960 

 

F-40

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 05 - FINANCIAL ASSETS FOR TRADING AT FAIR VALUE TRHOUGH PROFIT AND LOSS, continued

 

b.As of December 31, 2021 and 2020 the Bank holds the following portfolio of debt financial instruments for trading:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Chilean Central Bank and Government securities        
Chilean Central Bank financial instruments   
-
    1,412 
Chilean Treasury bonds and notes   98,308    152,555 
Subtotal   98,308    153,967 
Other Chilean debt financial securities          
Chilean corporate bonds   
-
    
-
 
Subtotal   
-
    
-
 
Foreign financial debt securities          
Other foreign financial instruments   
-
    79 
Subtotal   
-
    79 
           
Total   98,308    154,046 

 

As of December 31, 2023 and 2022, there were no trading investments sold under resell agreements to clients or financial institutions.

 

F-41

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 06 – FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME

 

The financial assets at fair value through other comprehensive income is as follows:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Debt financial instruments        
Chilean Central Bank and Government securities   3,024,700    4,074,413 
Other Chilean debt financial securities   6,656    9,898 
Foreign financial debt securities   1,504,669    1,796,422 
Subtotal   4,536,025    5,880,733 
Other financial instruments          
Commercial loans   105,257    142,306 
Subtotal   105,257    142,306 
           
Total   4,641,282    6,023,039 

 

a.As of December 31, 2023 and 2022 detail of financial debt instruments is as follows:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Chilean Central Bank and Government securities        
Chilean Central Bank financial instruments   2,286,541    3,331,264 
Chilean Treasury bonds and notes   737,705    742,717 
Other Chilean government financial instruments   454    432 
Subtotal   3,024,700    4,074,413 
of which sold under repurchase agreement   362,893    207,280 
Other Chilean debt financial securities          
Chilean Bank debt financial instruments   6,656    9,891 
Other Chilean financial instruments   
-
    7 
Subtotal   6,656    9,898 
of which sold under repurchase agreement   77    91 
Foreign financial debt securities          
Foreign Central Banks debt financial instruments   1,238,866    1,668,670 
Other foreign financial instruments   265,803    127,752 
Subtotal   1,504,669    1,796,422 
of which sold under repurchase agreement   
-
    127,752 
Total   4,536,025    5,880,733 

 

The Bank holds instruments, within “Chilean Central Bank and government securities”, which guarantee derivatives transactions through Comder Contraparte Central S.A., in the local market as of December 31, 2023 and 2022 for an amount of Ch$224,680 and Ch$133,480, respectively, while “Foreign financial debt securities” guarantee derivatives transactions through London Clearing House (LCH) as of December 31, 2023 and 2022 for an amount of Ch$71,705 and Ch$69,666, respectively. Additionally, the Bank maintains guarantees with Euroclear as of December 31, 2023 and 2022 for an amount of Ch$564,020 and Ch$590,466, respectively, to comply with the initial margin required by European EMIR Standard.

 

F-42

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 06 – FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME, continued

 

As of December 31, 2023, changes in fair value of financial assets measured at FVCO included a cumulative net unrealized loss of MCh$89,748, recorded as “valuation adjustment” in OCI, where MCh$91,596 (loss) are attributable to shareholders equity and MCh$1,848 (profit) to non-controlling interest.

 

As of December 31, 2022, changes in fair value of financial assets measured at FVCO included a cumulative net unrealized loss of MCh$109,392, recorded as “valuation adjustment” in OCI, where MCh$110,130 (loss) are attributable to shareholders equity and MCh$738 (profit) to non-controlling interest.

 

The changes in the fair value and the corresponding ECL as of December 31, 2023 is as follows:

 

   Stage 1   Stage 2   Stage 3   TOTAL 
Gross carrying amount at January 1, 2023  5,880,733  
-
  
-
   5,880,733 
New financial assets purchased   41,150,092    
-
    
-
    41,150,092 
Transfers to stage 1   
-
    
-
    
-
    
-
 
Transfers to stage 2   
-
    
-
    
-
    
-
 
Transfers to stage 3   
-
    
-
    
-
    
-
 
Assets derecognised or matured (excluding write-off)   (42,616,549)   
-
    
-
    (42,616,549)
Changes in measument of financial assets   121,749    
-
    
-
    121,749 
Other adjustments   -    -    -    - 
At December 31, 2023   4,536,025    
-
    
-
    4,536,025 

 

   Stage 1   Stage 2   Stage 3   TOTAL 
ECL at January 1, 2023   877    
-
    
-
    877 
New financial assets purchased   9,051    
-
    
-
    9,051 
Transfers to stage 1   
-
    
-
    
-
    
-
 
Transfers to stage 2   
-
    
-
    
-
    
-
 
Transfers to stage 3   
-
    
-
    
-
    
-
 
Assets derecognised or matured (excluding write-off)   (9,174)   
-
    
-
    (9,174)
Changes due to changes in credit risk   33    
-
    
-
    33 
Write-off   
-
    
-
    
-
    
-
 
Other adjustments   
-
    
-
    
-
    
-
 
At December 31, 2023   787    
-
    
-
    787 

  

The changes in the fair value and the corresponding ECL as of December 31, 2022 is as follows:

 

   Stage 1   Stage 2   Stage 3   TOTAL 
Gross carrying amount at January 1, 2022  5,803,139  
-
  
-
   5,801,379 
New financial assets purchased   31,456,434    
-
    
-
    31,456,434 
Transfers to stage 1   
-
    
-
    
-
    
-
 
Transfers to stage 2   
-
    
-
    
-
    
-
 
Transfers to stage 3   
-
    
-
    
-
    
-
 
Assets derecognised or matured (excluding write-off)   (31,248,163)   
-
    
-
    (31,248,163)
Changes in measument of financial assets   (130,677)   
-
    
-
    (128,917)
Other adjustments   
-
    
-
    
-
    
-
 
At December 31, 2022   5,880,733    
-
    
-
    5,880,733 

 

   Stage 1   Stage 2   Stage 3   TOTAL 
ECL at January 1, 2022   703    
-
    
-
    703 
New financial assets purchased   5,627    
-
    
-
    5,627 
Transfers to stage 1   
-
    
-
    
-
    
-
 
Transfers to stage 2   
-
    
-
    
-
    
-
 
Transfers to stage 3   
-
    
-
    
-
    
-
 
Assets derecognised or matured (excluding write-off)   (5,553)   
-
    
-
    (5,553)
Changes due to changes in credit risk   100    
-
    
-
    100 
Write-off   
-
    
-
    
-
    
-
 
Other adjustments   
-
    
-
    
-
    
-
 
At December 31, 2022   877    
-
    
-
    877 

 

F-43

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 06 – FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME, continued

 

Gross profits and losses realized on the sale of available for sale investments as of December 31, 2023, 2022 and 2021 is as follows:

 

   As of December 31, 
   2023   2022   2021 
   MCh$   MCh$   MCh$ 
Sale of debt financial instruments at FVOCI generating realized profits   6,837,112    452,668    1,728,731 
Realized profits   392    121    28,131 
Sale of debt financial instruments at FVOCI generating realized losses   1,605,762    1,122,222    1,247,044 
Realized losses   134,485    22,195    4,944 

 

The Bank evaluated those instruments with unrealized losses as of December 31, 2023 and 2022 and concluded they were not impaired. This review consisted of evaluating the economic reasons for any declines, the credit ratings of the securities’ issuers, and the Bank’s intention and ability to hold the securities until the unrealized loss is recovered. Based on this analysis, the Bank believes that there were no significant or prolonged declines nor changes in credit risk which would cause impairment in its investment portfolio, since most of the decline in fair value of these instruments was caused by market conditions which the Bank considers to be temporary. All of the instruments that have unrealized losses as of December 31, 2023 and 2022 were not in a continuing unrealized loss position for more than one year.

 

b.Other financial instruments

 

The Bank classifies certain loans and account receivables at fair value through other comprehensive income (FVOCI), when a credit operation exceeds single client exposure under the Bank’s credit risk policy. Initially, the risk committee approves the full operation but with the condition to sell a portion of the loan in the medium term.

 

Additionally, the Bank includes operations that expect to sell, for which an increase of the credit risk has been identified.

 

This portfolio is measured at fair value, recognising the adjustment in other comprehensive income. The portfolio is assessed for impairment loss under the ECL model, same as loans at amortised cost.

 

The changes in the gross carrying amount and the corresponding ECL allowance as of December 31, 2023, is as follows:

 

   Stage 1   Stage 2   Stage 3   TOTAL 
   MCh$   MCh$   MCh$   MCh$ 
Gross carrying amount at January 1, 2023   142,632    
          -
    
          -
    142,632 
New financial assets originated   85,533    
 
    
 
    85,533 
Transfers to stage 1   
-
    
-
    
-
    
-
 
Transfers to stage 2   
-
    
-
    
-
    
-
 
Transfers to stage 3   
-
    
-
    
-
    
-
 
Assets derecognised or matured (excluding write-off)   (138,700)   
-
    
-
    (138,700)
Changes in measument of financial assets   15,916    
-
    
-
    15,916 
Write-off   
-
    
-
    
-
    
-
 
Other adjustments   
-
    
-
    
-
    
-
 
At December 31, 2023   105,381    
-
    
-
    105,381 

 

   Stage 1   Stage 2   Stage 3   TOTAL 
   MCh$   MCh$   MCh$   MCh$ 
ECL allowance at January 1, 2023   326    
          -
    
          -
    326 
New financial assets originated   162    
 
    
 
    162 
Transfers to stage 1   
-
    
-
    
-
    
-
 
Transfers to stage 2   
-
    
-
    
-
    
-
 
Transfers to stage 3   
-
    
-
    
-
    
-
 
Assets derecognised or matured (excluding write-off)   (313)   
-
    
-
    (313)
Changes due to changes un credit risk   (50)   
-
    
-
    (50)
Write-off   
-
    
-
    
-
    
-
 
Other adjustments   
-
    
-
    
-
    
-
 
At December 31, 2023   125    
-
    
-
    125 

 

F-44

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 06 – FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME, continued

 

The changes in the gross carrying amount and the corresponding ECL allowance as of December 31, 2022, is as follows:

 

   Stage1   Stage2   Stage3   TOTAL 
   MCh$   MCh$   MCh$   MCh$ 
Gross carrying amount at January 1, 2022   99,643    
-
    
-
    99,643 
New financial assets originated   72,745    
 
    
 
    72,745 
Transfers to stage 1   
-
    
-
    
-
    
-
 
Transfers to stage 2   
-
    
-
    
-
    
-
 
Transfers to stage 3   
-
    
-
    
-
    
-
 
Assets derecognised or matured (excluding write-off)   (24,835)   
-
    
-
    (24,835)
Changes in measument of financial assets   (4,921)   
-
    
-
    (4,921)
Write-off   
-
    
-
    
-
    
-
 
Other adjustments   -    
-
    
-
    - 
At December 31, 2022   142,632    
-
    
-
    142,632 

 

   Stage 1   Stage 2   Stage 3   TOTAL 
   MCh$   MCh$   MCh$   MCh$ 
ECL allowance at January 1, 2022   268    
-
    
-
    268 
New financial assets originated   76    
 
    
 
    76 
Transfers to stage 1   
-
    
-
    
-
    
-
 
Transfers to stage 2   
-
    
-
    
-
    
-
 
Transfers to stage 3   
-
    
-
    
-
    
-
 
Assets derecognised or matured (excluding write-off)   (110)   
-
    
-
    (110)
Changes due to changes un credit risk   92    
-
    
-
    92 
Write-off   
-
    
-
    
-
    
-
 
Other adjustments   
-
    
-
    
-
    
-
 
At December 31, 2022   326    
-
    
-
    326 

  

F-45

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 06 – FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME, continued

 

The following charts show debt instruments at fair value through other comprehensive income cumulative unrealized losses, as of December 31, 2023:

 

   Less than 12 months   More than 12 months   Total 
2023  Amortised
cost
   Fair value  

Unrealized

profit

   Unrealized
loss
   Amortised
cost
   Fair value  

Unrealized

profit

   Unrealized
loss
   Amortised
cost
   Fair value  

Unrealized

profit

   Unrealized
loss
 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Chilean Central Bank and Government securities                  -   -   -   -                 
Chilean Central Bank financial instruments   2,286,208    2,286,541    417    (84)   
-
    
-
    
-
    
-
    2,286,208    2,286,541    417    (84)
Chilean Treasury bonds and notes   801,738    737,705    24,466    (88,499)   
            -
    
     -
    
         -
    
           -
    801,738    737,705    24,466    (88,499)
Other Chilean government financial instruments   444    454    10    
-
    
-
    
-
    
-
    
-
    444    454    10    
-
 
Subtotal   3,088,390    3,024,700    24,893    (88,583)   
-
    
-
    
-
    
-
    3,088,390    3,024,700    24,893    (88,583)
                                                             
Other Chilean debt financial securities                                                            
Chilean Bank debt financial instruments   7,858    6,656    23    (1,225)   
-
    
-
    
-
    
-
    7,858    6,656    23    (1,225)
Other Chilean financial instruments   -    -    
-
    
-
    
-
    
-
    
-
    
-
    -    -    
-
    
-
 
Subtotal   7,858    6,656    23    (1,225)   
-
    
-
    
-
    
-
    7,858    6,656    23    (1,225)
                                                             
Foreign financial debt securities                                                            
Foreign Central Banks financial instruments   1,264,768    1,238,866    18,330    (44,232)   
-
    
-
    
-
    
-
    1,268,492    1,238,866    14,606    (44,232)
Other foreign debt financial instruments   260,401    265,803    6,966    (1,564)   
-
    
-
    
-
    
-
    260,401    265,803    6,966    (1,564)
Subtotal   1,525,169    1,504,669    25,296    (45,796)   
-
    
-
    
-
    
-
    1,528,893    1,504,669    21,572    (45,796)
Loans and account receivable from customer                                                            
Commercial loans   109,613    105,257    
-
    (4,356)   
-
    
-
    
-
    
-
    109,613    105,257    
-
    (4,356)
Subtotal   109,613    105,257    
-
    (4,356)   
-
    
-
    
-
    
-
    109,613    105,257    
-
    (4,356)
                        -    -    -    -                     
Total   4,731,030    4,641,282    50,212    (139,960)   
-
    
-
    
-
    
-
    4,734,754    4,641,282    46,488    (139,960)

 

F-46

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 06 – FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME, continued

 

The following charts show debt instruments at fair value through other comprehensive income cumulative unrealized losses, as of December 31, 2022:

 

   Less than 12 months   More than 12 months   Total 
2022  Amortised
cost
   Fair value  

Unrealized

profit

   Unrealized
loss
   Amortised
cost
   Fair value  

Unrealized

profit

   Unrealized
loss
   Amortised
cost
   Fair value  

Unrealized

profit

   Unrealized
loss
 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Chilean Central Bank and Government securities                  -   -   -   -                 
Chilean Central Bank financial instruments   3,331,635    3,331,264    2,270    (2,641)               -         -               -                  -    3,331,635    3,331,264    2,270    (2,641)
Chilean Treasury bonds and notes   834,935    742,717    27    (92,218)   -    -    -    -    834,935    742,717    27    (92,218)
Other Chilean government financial instruments   407    432    25    -    -    -    -    -    407    432    25    - 
Subtotal   4,166,977    4,074,413    2,322    (94,859)   -    -    -    -    4,166,977    4,074,413    2,322    (94,859)
                                                             
Other Chilean debt financial securities                                                            
Chilean Bank debt financial instruments   10,082    9,891    17    (207)   -    -    -    -    10,082    9,891    17    (207)
Other Chilean financial instruments   6    7    -    -    -    -    -    -    6    7    -    - 
Subtotal   10,088    9,898    17    (207)   -    -    -    -    10,088    9,898    17    (207)
                                                             
Foreign financial debt securities                                                            
Foreign Central Banks financial instruments   1,683,052    1,668,670    39,210    (53,592)   -    -    -    -    1,683,052    1,668,670    39,210    (53,592)
Other foreign debt financial instruments   116,351    127,752    11,401    -    -    -    -    -    116,351    127,752    11,401    - 
Subtotal   1,799,403    1,796,422    50,611    (53,592)   -    -    -    -    1,799,403    1,796,422    50,611    (53,592)
Loans and account receivable from customer                                                            
Commercial loans   155,990    142,306    -    (13,684)   -    -    -    -    155,990    142,306    -    (13,684)
Subtotal   155,990    142,306    -    (13,684)   -    -    -    -    155,990    142,306    -    (13,684)
                        -    -    -    -                     
Total   6,132,458    6,023,039    52,950    (162,342)   -    -    -    -    6,132,458    6,023,039    52,950    (162,342)

  

F-47

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 07 - FINANCIAL DERIVATIVES CONTRACTS FOR HEDGE ACCOUNTING

 

As of December 31, 2023 and 2022 the Bank holds the following portfolio of derivative instruments for hedging purposes:

 

   As of December 31, 2023             
   Notional amount       Fair value 
   Demand
  

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   Assets   Liabilities 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Fair value hedge derivatives                                
Interest rate swaps            -    12,562    3,656,708    2,971,608    2,219,138    349,780    612,115    9,821,911    96,729    1,319,275 
Cross currency swaps   -    87,445    216,904    902,332    4,075,196    497,502    1,764,227    7,543,606    251,810    174,041 
Subtotal   -    100,007    3,873,612    3,873,940    6,294,334    847,282    2,376,342    17,365,517    348,539    1,493,316 
Currency forwards   -    43,242    177,000    2,207,656    8,745    
-
    
-
    2,436,643    5,539    64,624 
Cross currency swaps   -    459,517    1,144,579    5,286,020    6,210,538    1,205,343    1,676,266    15,982,263    251,451    908,827 
Subtotal   -    502,759    1,321,579    7,493,676    6,219,283    1,205,343    1,676,266    18,418,906    256,990    973,451 
Total   -    602,766    5,195,191    11,367,616    12,513,617    2,052,625    4,052,608    35,784,423    605,529    2,466,767 

 

   As of December 31, 2022             
   Notional amount       Fair value 
   Demand  

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   Assets   Liabilities 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Fair value hedge derivatives                                
Interest rate swaps   -    206,630    447,773    722,845    7,300,878    608,013    1,728,916    11,015,055    213,478    1,166,339 
Cross currency swaps            -    84,959    706,859    1,512,048    3,149,733    1,200,889    1,462,413    8,116,901    75,848    333,097 
Subtotal   -    291,589    1,154,632    2,234,893    10,450,611    1,808,902    3,191,329    19,131,956    289,326    1,499,436 
Cash flow hedge derivatives                                                  
Currency forwards   -    176,664    1,839,766    554,696    
-
    
-
    
-
    2,571,126    823    35,332 
Cross currency swaps   -    486,032    932,204    2,019,072    6,703,372    2,077,260    2,261,958    14,479,898    187,613    1,254,026 
Subtotal   -    662,696    2,771,970    2,573,768    6,703,372    2,077,260    2,261,958    17,051,024    188,436    1,289,358 
Total   -    954,285    3,926,602    4,808,661    17,153,983    3,886,162    5,453,287    36,182,980    477,762    2,788,794 

 

a.Micro-hedge accounting

 

Fair value micro-hedge

 

The Bank uses cross-currency swaps and interest rate swaps to hedge its exposure to changes in fair value of hedged items attributable to interest rates. Those hedging instruments change the effective cost of long-term issuances from a fixed interest rate to a variable interest rate.

 

F-48

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 07 - FINANCIAL DERIVATIVES CONTRACTS FOR HEDGE ACCOUNTING, continued

 

Below is a detail of the hedged elements and hedge instruments under fair value hedges as of December 31, 2023 and 2022, classified by term to maturity:

 

   As of December 31, 2023 
   Demand  

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 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Hedged item                                
Debt instruments at FVOCI                                
Chilean sovereign bonds   
       -
    
-
    
-
    -    
-
    -    301,803    301,803 
US Treasury bonds   
-
    
-
    
-
    
-
    655,838    349,780    262,335    1,267,953 
Chilean Treasury bonds                                 50,795    50,795 
Time deposits and other time liabilities                                        
Time deposits   
-
    12,562    27,708    92,160    -    
-
    
-
    132,430 
Instrumentos de deuda emitidos                                        
Senior bonds   -    -    91,973    882,779    2,262,976    497,502    696,941    4,432,171 
Subordinated bonds   
-
    87,445    
-
    -    183,946         505,998    777,389 
Interbank borrowing                                        
Chilean Central Bank loans   
-
    
-
    3,329,001    2,849,001         
-
    
-
    6,178,002 
Total   -    100,007    3,448,682    3,823,940    3,102,760    847,282    1,817,872    13,140,543 
Hedging instrument                                        
Cross currency swaps   -    87,445    91,973    902,331    2,433,621    497,502    1,205,760    5,218,632 
Forwards   -    12,562    3,356,709    2,921,609    669,139    349,780    612,112    7,921,911 
Total   -    100,007    3,448,682    3,823,940    3,102,760    847,282    1,817,872    13,140,543 

 

   As of December 31, 2022 
   Demand  

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 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Hedged item                                
Loans and account receivable at amortised cost                                    
Commercial loans   
            -
    -    -    180,963    
-
    
-
    
-
    180,963 
Debt instruments at FVOCI                                        
US Treasury bonds   
-
    
-
    
-
    
-
    
-
    594,713    1,389,080    1,983,793 
Time deposits and other time liabilities                                        
Time deposits   
-
    206,630    447,773    873,822    141,539    
-
    
-
    1,669,764 
Instrumentos de deuda emitidos                                        
Senior bonds   
-
    
-
    -    122,638    2,569,632    1,038,634    757,861    4,488,765 
Subordinated bonds   
-
    
-
    
-
    
-
    84,959    175,555    485,917    746,431 
Interbank borrowing                                        
Interbank loans   
-
    84,959    706,859    1,057,470    
-
    
-
    
-
    1,849,288 
Chilean Central Bank loans   
-
    
-
    
-
    
-
    6,178,000    
-
    
-
    6,178,000 
Total   -    291,589    1,154,632    2,234,893    8,974,130    1,808,902    2,632,858    17,097,004 
Hedging instrument                                        
Cross currency swaps   -    84,959    706,859    1,512,048    2,573,252    1,200,890    903,942    6,981,950 
Forwards   -    206,630    447,773    722,845    6,400,878    608,012    1,728,916    10,115,054 
Total   -    291,589    1,154,632    2,234,893    8,974,130    1,808,902    2,632,858    17,097,004 

 

F-49

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 07 - FINANCIAL DERIVATIVES CONTRACTS FOR HEDGE ACCOUNTING, continued

 

Cash flow micro-hedges

 

The Bank uses cross currency swaps to hedge the risk from variability of cash flows attributable to changes in the interest rates of bonds and interbank loans at a variable interest rate. The inflation risk that arises in some items is covered by both forwards as well as cross currency swaps.

 

Below is the notional amount of the hedged items as of December 31, 2023 and 2022, and the period when the cash flows will be generated:

 

   As of December 31, 2023
   Demand 

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
   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Hedged item                        
Loans and accounts receivable at amortised cost                        
Mortgage loans   
         -
    232,909    596,597    3,889,412    4,192,353    766,685    1,077,483    10,755,439 
Debt instruments at FVOCI                                        
Chilean Treasury bonds   
-
    
-
    
-
    
-
    492,370    -    191,905    684,275 
Time deposits and other time liabilities                                        
Time deposits   
-
    
-
    21,861    392,453    8,744    
-
    
-
    423,058 
Issued debt instruments                                        
Senior bonds   
-
    
-
    
-
    
-
    331,104    
-
    
-
    331,104 
Subordinated bonds   
-
    269,850    124,236    549,555    893,024    263,768    406,878    2,507,311 
Interbank borrowings                                        
Interbank loans   
-
    
-
    578,885    2,662,256    301,688    174,890    
-
    3,717,719 
Total   
-
    502,759    1,321,579    7,493,676    6,219,283    1,205,343    1,676,266    18,418,906 
Hedging instrument                                        
Cross currency swaps   
-
    459,518    1,144,579    5,286,018    6,210,539    1,205,343    1,676,266    15,982,263 
Currency forward   
-
    43,241    177,000    2,207,658    8,744    
-
    
-
    2,436,643 
Total   
-
    502,759    1,321,579    7,493,676    6,219,283    1,205,343    1,676,266    18,418,906 

 

   As of December 31, 2022
   Demand 

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
   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Hedged item                        
Loans and accounts receivable at amortised cost                        
Mortgage loans   
     -
    545,747    2,563,558    1,999,451    5,568,862    1,026,081    1,577,002    13,280,701 
Debt instruments at FVOCI                                        
Chilean Treasury bonds   
-
    
-
    
-
    
-
    
-
    492,370    191,906    684,276 
Issued debt instruments                                        
Senior bonds   
-
    
-
    
-
    
-
    315,999    
-
    
-
    315,999 
Subordinated bonds   
-
    70,222    140,444    245,526    818,511    558,809    493,051    2,326,563 
Interbank borrowings                                        
Interbank loans   
-
    46,727    67,967    328,791    
-
    
-
    
-
    443,485 
Total   
-
    662,696    2,771,969    2,573,768    6,703,372    2,077,260    2,261,959    17,051,024 
Hedging instrument                                        
Cross currency swaps   
-
    486,032    932,203    2,019,072    6,703,372    2,077,260    2,261,959    14,479,898 
Currency forward   
-
    176,664    1,839,766    554,696    
-
    
-
    
-
    2,571,126 
Total   
-
    662,696    2,771,969    2,573,768    6,703,372    2,077,260    2,261,959    17,051,024 

 

F-50

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 07 - FINANCIAL DERIVATIVES CONTRACTS FOR HEDGE ACCOUNTING, continued

 

i.Forecasted cash flows for interest rate risk

 

Below is an estimate of the periods in which cash flows are expected to be produced:

 

   As of December 31, 2023   
   Demand 

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
   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Hedged item                        
Inflows   
          -
    
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Outflows   
-
    (7,483)   (13,555)   (68,956)   (39,724)   (7,913)   (2,980)   (140,611)
Net flows   
-
    (7,483)   (13,555)   (68,956)   (39,724)   (7,913)   (2,980)   (140,611)
Hedging instrument                                        
Inflows   
-
    
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Outflows (*)   
-
    7,483    13,555    68,956    39,724    7,913    2,980    140,611 
Net flows   
-
    7,483    13,555    68,956    39,724    7,913    2,980    140,611 

 

(*)Only includes cash flow forecast portion of the hedge instruments used to cover interest rate risk.

 

   As of December 31, 2022   
   Demand 

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
   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Hedged item                        
Inflows   
        -
    
-
    4,267    4,627    
-
    
-
    
-
    8,894 
Outflows   
-
    (288)   (733)   (5,993)   (10,273)   (5,063)   (4,310)   (26,660)
Net flows   
-
    (288)   3,534    (1,366)   (10,273)   (5,063)   (4,310)   (17,766)
Hedging instrument                                        
Inflows   
-
    
-
    (4,267)   (4,627)   
-
    
-
    
-
    (8,894)
Outflows (*)   
-
    288    733    5,993    10,273    5,063    4,310    26,660 
Net flows   
-
    288    (3,534)   1,366    10,273    5,063    4,310    17,766 

 

(*)Only includes cash flow forecast portion of the hedge instruments used to cover interest rate risk.

 

ii.Forecasted cash flows for inflation risk:

 

   As of December 31, 2023   
   Demand 

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
   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Hedged item                        
Inflows   
     -
    23,515    91,152    302,604    72,206    19,206    33,221    541,904 
Outflows   
-
    (78,300)   (379,379)   (784,238)   (552,738)   (49,350)   (39,017)   (1,883,022)
Net flows   
-
    (54,785)   (288,227)   (481,634)   (480,532)   (30,144)   (5,796)   (1,341,118)
Hedging instrument                                        
Inflows   
-
    78,300    379,379    784,238    552,738    49,350    39,017    1,883,022 
Outflows   
-
    (23,515)   (91,152)   (302,604)   (72,206)   (19,206)   (33,221)   (541,904)
Net flows   
-
    54,785    288,227    481,634    480,532    30,144    5,796    1,341,118 

 

   As of December 31, 2022   
   Demand 

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
   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Hedged item                        
Inflows   
           -
    112,209    410,507    397,542    1,197,961    393,717    702,610    3,214,546 
Outflows   
-
    (10,882)   (24,505)   (20,551)   (98,565)   (52,368)   (52,297)   (259,168)
Net flows   
-
    101,327    386,002    376,991    1,099,396    341,349    650,313    2,955,378 
Hedging instrument                                        
Inflows   
-
    10,882    24,505    20,551    98,565    52,368    52,297    259,168 
Outflows   
-
    (112,209)   (410,507)   (397,542)   (1,197,961)   (393,717)   (702,610)   (3,214,546)
Net flows   
-
    (101,327)   (386,002)   (376,991)   (1,099,396)   (341,349)   (650,313)   (2,955,378)

 

F-51

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 07 - FINANCIAL DERIVATIVES CONTRACTS FOR HEDGE ACCOUNTING, continued

 

iii.Forecasted cash flows for exchange rate risk

 

   As of December 31, 2023   
   Demand 

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
   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Hedged item                        
Inflows   
       -
    
-
    
-
    
-
    
-
    
-
    
       -
    
-
 
Outflows   
-
    (30,629)   (168,812)   (1,992,343)   (22,684)   (3,212)   
-
    (2,217,680)
Net flows   
-
    (30,629)   (168,812)   (1,992,343)   (22,684)   (3,212)   
-
    (2,217,680)
Hedging instrument                                        
Inflows   
-
    
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Outflows   
-
    30,629    168,812    1,992,343    22,684    3,212    
-
    2,217,680 
Net flows   
-
    30,629    168,812    1,992,343    22,684    3,212    
-
    2,217,680 

 

   As of December 31, 2022   
   Demand 

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
   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Hedged item                        
Inflows   
         -
    
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Outflows   
-
    (5,687)   (4,281)   (20,192)   (6,784)   (3,208)   (1,606)   (41,758)
Net flows   
-
    (5,687)   (4,281)   (20,192)   (6,784)   (3,208)   (1,606)   (41,758)
Hedging instrument                                        
Inflows   
-
    
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Outflows   
-
    5,687    4,281    20,192    6,784    3,208    1,606    41,758 
Net flows   
-
    5,687    4,281    20,192    6,784    3,208    1,606    41,758 

 

b.Other comprehensive income effect

 

The accumulated effect of the mark to market adjustment of cash flow hedges generated by hedge instruments used in hedged cash flow was recorded in the Consolidated Statements of Changes in Equity, within other comprehensive income, as of December 31, 2023 and 2022, is as follows:

 

   As of December 31,
Hedged item  2023  2022
   MCh$  MCh$
Interbank loans   (10,675)   (2,343)
Time deposits and other time liabilities   516    
-
 
Issued debt instruments   (9,684)   415 
Debt instruments at FVOCI   (4,235)   (22,571)
Loans and accounts receivable at amortised cost   108,494    (94,339)
Total   84,416    (118,838)

 

Since the inflows and outflows for both the hedged element and the hedging instrument mirror each other, the hedges are nearly 100% effective, which means that fluctuations of fair value attributable to risk components are almost completely offset.

 

During the current year, the Bank did not enter into any cash flow hedges relating to forecasted transactions.

 

F-52

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 07 - FINANCIAL DERIVATIVES CONTRACTS FOR HEDGE ACCOUNTING, continued

 

c.P&L effect

 

The amounts recycling from other comprehensive income to income for the year related to cash flow hedges are as follows:

 

   For the years ended December 31,
   2023  2022  2021
   MCh$  MCh$  MCh$
Bond hedging derivatives   817    (826)   (3,248)
Interbank loans hedging derivatives   (4,775)   (4,762)   (286)
Mortgage loans hedging derivatives   (36,154)   (37,698)   (22,160)
Cash flow hedge net gain (loss)   (40,112)   (43,286)   (25,694)

 

See Note 21 - Equity, letter e, for other comprehensive income reconciliation

 

d.Net investment hedges in foreign operations

 

As of December 31, 2023, and 2022, the Bank does not have any foreign net investment hedges nor hedge accounting.

 

e.Fair value macro-hedges

 

   Notional amount
As of December 31, 2023  Demand 

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
   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Hedge item                        
Loans and account receivable at amortised cost                        
Mortgage loans   
         -
    
     -
    
-
    
-
    
-
    
          -
    377,928    377,928 
Commercial loans   
-
    
-
    424,930    50,000    3,191,574    
-
    180,542    3,847,046 
Total   
-
    
-
    424,930    50,000    3,191,574    
-
    558,470    4,224,974 
Hedging instrument                                        
Cross currency swaps   
-
    
-
    124,930    
-
    1,641,574    
-
    558,470    2,324,974 
Interest rate swaps   
-
    
-
    300,000    50,000    1,550,000    
-
    
-
    1,900,000 
Total   
-
    
-
    424,930    50,000    3,191,574    
-
    558,470    4,224,974 

 

   Notional amount
As of December 31, 2022  Demand 

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
   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Hedge item                        
Loans and account receivable at amortised cost                                                         
Mortgage loans   
       -
    
       -
    
         -
    
          -
    576,481    
           -
    558,470    1,134,951 
Commercial loans   
-
    
-
    
-
    
-
    900,000    
-
    
-
    900,000 
Total   
-
    
-
    
-
    
-
    1,476,481    
-
    558,470    2,034,951 
Hedging instrument                                        
Cross currency swaps   
-
    
-
    
-
    
-
    576,481    
-
    558,470    1,134,951 
Interest rate swaps   
-
    
-
    
-
    
-
    900,000    
-
    
-
    900,000 
Total   
-
    
-
    
-
    
-
    1,476,481    
-
    558,470    2,034,951 

 

As of December 31, 2023, and 2022 Other Assets include MCh$160,370 and MCh$160,531 respectively, related to fair value measurement of net assets or liabilities subject to macrohedges. See Note 14.

 

As of December 31, 2023, and 2022, Other Liabilities include MCh$68,781 and MCh$85,725 respectively, related to fair value measurement of net assets or liabilities subject to macrohedges. See Note 20.

 

F-53

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 08 - FINANCIAL ASSETS AT AMORTISED COST

 

As of December 31, 2023 and 2022 the composition and balances are as follows:

 

   As of December 31,
   2023  2022
   MCh$  MCh$
Debt financial instruments      
Chilean Central Bank and Government securities   8,176,895    4,867,591 
Subtotal   8,176,895    4,867,591 
Interbank loans          
Foreign banks   68,438    32,990 
Subtotal   68,438    32,990 
Loans and account receivable from customers          
Commercial loans   17,412,063    17,023,023 
Mortgage loans   16,857,306    15,566,253 
Consummer loans   5,324,088    4,953,868 
Subtotal   39,593,457    37,543,144 
           
Total   47,838,790    42,443,725 

 

a.Debt financial instruments

 

The detail of the instruments classified as Debt instruments at amortised cost is as follows:

 

   As of December 31,
   2023  2022
   MCh$  MCh$
Chilean Central Bank and Government securities      
Chilean Central Bank financial instrumentos   3,392,609    
-
 
Chilean Treasury bonds and notes   4,786,015    4,868,485 
Other Chilean government financial instruments   
-
    
-
 
Subtotal   8,178,624    4,868,485 
           
Expected credit loss allowance   (1,729)   (894)
           
Total   8,178,895    4,867,591 

 

F-54

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 08 - FINANCIAL ASSETS AT AMORTISED COST, continued

 

The changes in the amortised value and the corresponding ECL as of December 31, 2023 is as follows:

 

   Stage1  Stage2  Stage3  TOTAL
Gross carrying amount at January 1, 2023   4,868,485    
         -
    
       -
    4,868,485 
New financial assets purchased   3,342,572    
-
    
-
    3,342,572 
Transfers to stage 1   
-
    
-
    
-
    
-
 
Transfers to stage 2   
-
    
-
    
-
    
-
 
Transfers to stage 3   
-
    
-
    
-
    
-
 
Assets derecognised or matured (excluding write-off)   (96,899)   
-
    
-
    (96,899)
Changes due to modifications not derecognised   64,466    
-
    
-
    64,466 
Other adjustments   
-
    
-
    
-
    
-
 
At December 31, 2023   8,178,624    
-
    
-
    8,178,624 

 

   Stage1  Stage2  Stage3  TOTAL
ECL at January 1, 2023   894    
      -
    
        -
    894 
New financial assets purchased   706    
-
    
-
    706 
Transfers to stage 1   
-
    
-
    
-
    
-
 
Transfers to stage 2   
-
    
-
    
-
    
-
 
Transfers to stage 3   
-
    
-
    
-
    
-
 
Assets derecognised or matured (excluding write-off)   (22)   
-
    
-
    (22)
Changes due to modifications not derecognised   151    
-
    
-
    151 
Write-off   
-
    
-
    
-
    
-
 
Other adjustments   
-
    
-
    
-
    
-
 
At December 31, 2023   1,729    
-
    
-
    1,729 

 

The changes in the amortised value and the corresponding ECL as of December 31, 2022 is as follows:

 

   Stage1  Stage2  Stage3  TOTAL
Gross carrying amount at January 1, 2022   4,692,441    
       -
    
       -
    4,692,441 
New financial assets purchased   -    
-
    
-
    - 
Transfers to stage 1   
-
    
-
    
-
    
-
 
Transfers to stage 2   
-
    
-
    
-
    
-
 
Transfers to stage 3   
-
    
-
    
-
    
-
 
Assets derecognised or matured (excluding write-off)   
-
    
-
    
-
    
-
 
Changes due to modifications not derecognised   176,044    
-
    
-
    176,044 
Other adjustments   
-
    
-
    
-
    
-
 
At December 31, 2022   4,868,485    
-
    
-
    4,868,485 

 

   Stage1  Stage2  Stage3  TOTAL
ECL at January 1, 2022   711    
       -
    
       -
    711 
New financial assets purchased   -    
-
    
-
    - 
Transfers to stage 1   
-
    
-
    
-
    
-
 
Transfers to stage 2   
-
    
-
    
-
    
-
 
Transfers to stage 3   
-
    
-
    
-
    
-
 
Assets derecognised or matured (excluding write-off)   
-
    
-
    
-
    
-
 
Changes due to modifications not derecognised   183    
-
    
-
    183 
Write-off   
-
    
-
    
-
    
-
 
Other adjustments   
-
    
-
    
-
    
-
 
At December 31, 2022   894    
-
    
-
    894 

 

F-55

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 08 - FINANCIAL ASSETS AT AMORTISED COST, continued

 

b.Interbank Loans and Loans and account receivable from customers

 

   Assets before allowances   ECL allowance     
As of December 31, 2023  Stage 1   Stage 2   Stage 3   Total   Stage 1   Stage 2   Stage 3   Total   Net
Assets
 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
                                     
Interbank loans                                    
Foreign banks   68,440    
-
    
-
    68,440    2    
-
    
-
    2    68,438 
Subtotal   68,440    
-
    
-
    68,440    2    
-
    
-
    2    68,438 
                                              
Commercial loans                                             
Commercial loans   11,065,756    1,147,185    1,023,496    13,236,437    48,647    54,103    453,245    555,995    12,680,442 
Foreign trade loans   1,884,336    27,399    30,942    1,942,677    2,195    359    17,742    20,296    1,922,381 
Checking accounts debtors   117,410    15,952    10,381    143,743    763    623    6,534    7,920    135,823 
Credit card debtors   111,154    16,112    10,951    138,217    960    1,527    6,433    8,920    129,297 
Factoring transactions   1,005,869    5,813    8,891    1,020,573    505    40    2,679    3,224    1,017,349 
Leasing transactions   1,057,448    125,259    56,270    1,238,977    5,095    8,031    24,146    37,272    1,201,705 
Student loans   26,795    10,178    10,111    47,084    831    2,031    7,154    10,016    37,068 
Other loans and accounts receivable   280,658    5,169    18,122    303,949    2,585    921    12,445    15,951    287,998 
Subtotal   15,549,426    1,353,067    1,169,164    18,071,657    61,581    67,635    530,378    659,594    17,412,063 
                                              
Mortgage loans                                             
Loans with mortgage finance bonds   396    14    64    474    1    2    16    19    455 
Endorsable mortgage mutual loans   788    136    158    1,082    1    9    38    48    1,034 
Mortgage mutual financed with mortgage bonds   77,289    10,335    3,136    90,760    43    405    718    1,166    89,594 
Other mortgage mutual loans   14,496,439    1,693,324    716,227    16,905,990    8,567    52,650    152,295    213,512    16,692,478 
Other credit and account receivable   60,811    9,376    4,946    75,133    39    305    1,044    1,388    73,745 
Subtotal   14,635,723    1,713,185    724,531    17,073,439    8,651    53,371    154,111    216,133    16,857,306 
                                              
Consumer loans                                             
Installment consumer loans   2,974,147    478,315    256,422    3,708,884    51,401    71,048    113,566    236,015    3,472,869 
Checking account debtors   111,901    31,647    7,406    150,954    1,713    969    2,423    5,105    145,849 
Credit card debtors   1,424,125    279,997    31,667    1,735,789    4,216    11,813    16,820    32,849    1,702,940 
Leasing transactions   1,911    142    29    2,082    86    18    10    114    1,968 
Other consumer loans   72    175    394    641    13    49    117    179    462 
Subtotal   4,512,156    790,276    295,918    5,598,350    57,429    83,897    132,936    274,262    5,324,088 
                                              
Total   34,765,745    3,856,528    2,189,613    40,811,886    127,663    204,903    817,425    1,149,991    39,661,895 

 

F-56

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 08 - FINANCIAL ASSETS AT AMORTISED COST, continued

 

   Assets before allowances   ECL allowance     
As of December 31, 2022  Stage 1   Stage 2   Stage 3   Total   Stage 1   Stage 2   Stage 3   Total   Net
Assets
 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
                                     
Interbank loans                                    
Foreign banks   32,991    
-
    
-
    32,991    1    
-
    
-
    1    32,990 
Subtotal   32,991    
-
    
-
    32,991    1    
-
    
-
    1    32,990 
                                              
Commercial loans                                             
Commercial loans   11,168,530    1,158,198    965,669    13,292,397    62,595    74,972    405,743    543,310    12,749,087 
Foreign trade loans   1,525,589    61,981    24,938    1,612,508    6,453    2,262    16,820    25,535    1,586,973 
Checking accounts debtors   106,281    16,204    9,776    132,261    1,049    1,179    6,438    8,666    123,595 
Credit card debtors   112,483    11,208    8,986    132,677    1,141    1,683    5,671    8,495    124,182 
Factoring transactions   859,269    13,438    5,683    878,390    956    587    1,812    3,355    875,035 
Leasing transactions   1,113,284    156,368    76,325    1,345,977    6,288    9,478    29,462    45,228    1,300,749 
Student loans   39,728    2,016    11,089    52,833    1,284    690    10,747    12,721    40,112 
Other loans and accounts receivable   219,294    2,753    15,499    237,546    3,487    505    10,264    14,256    223,290 
Subtotal   15,144,458    1,422,166    1,117,965    17,684,589    83,253    91,356    486,957    661,566    17,023,023 
                                              
Mortgage loans                                             
Loans with mortgage finance bonds   1,648    41    224    1,913    3    1    33    37    1,876 
Endorsable mortgage mutual loans   1,769    56    413    2,238    3    2    69    74    2,164 
Mortgage mutual financed with mortgage bonds   81,982    780    4,859    87,621    227    23    753    1,003    86,618 
Other mortgage mutual loans   14,513,299    364,616    679,780    15,557,695    19,130    10,371    131,460    160,961    15,396,734 
Other credit and account receivable   73,382    1,974    4,186    79,542    25    65    591    681    78,861 
Subtotal   14,672,080    367,467    689,462    15,729,009    19,388    10,462    132,906    162,756    15,566,253 
                                              
Consumer loans                                             
Installment consumer loans   3,195,357    177,463    206,540    3,579,360    74,428    60,096    138,842    273,366    3,305,994 
Checking account debtors   147,023    1,851    6,782    155,656    6,065    542    4,318    10,925    144,731 
Credit card debtors   1,481,073    38,320    24,783    1,544,176    13,318    13,310    17,117    43,745    1,500,431 
Leasing transactions   2,468    184    
-
    2,652    307    9    
-
    316    2,336 
Other consumer loans   175    48    745    968    85    16    491    592    376 
Subtotal   4,826,096    217,866    238,850    5,282,812    94,203    73,973    160,768    328,944    4,953,868 
                                              
Total   34,675,625    2,007,499    2,046,277    38,729,401    196,845    175,791    780,631    1,153,267    37,576,134 

 

F-57

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 08 - FINANCIAL ASSETS AT AMORTISED COST, continued

 

a.Interbank loans

 

The changes in the gross carrying amount and the corresponding ECL allowance as of December 31, 2023, is as follows:

 

   Stage 1   Stage 2   Stage 3     
   Corporate   Other
commercial
   Corporate   Other
commercial
   Corporate   Other
commercial
   TOTAL 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Gross carrying amount at January 1, 2023  32,991  
-
  
-
  
-
  
-
  
-
   32,991 
Transfers:                            
Transfers from stage 1 to stage 2   
 -
    
      -
    
       -
    
      -
    
       -
    
         -
    
-
 
Transfers from stage 1 to stage 3   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 2 to stage 3   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 2 to stage 1   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 3 to stage 2   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 3 to stage 1   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Net changes of financial assets   35,495    
-
    
-
    
-
    
-
    
-
    35,495 
Write-off   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Other adjustments   (46)   
-
    
-
    
-
    
-
    
-
    (46)
At December 31, 2023   68,440    
-
    
-
    
-
    
-
    
-
    68,440 

 

   Stage 1   Stage 2   Stage 3     
   Corporate   Other
commercial
   Corporate   Other
commercial
   Corporate   Other
commercial
   TOTAL 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
ECL allowance at January 1, 2023   1    
-
    
-
    
-
    
-
    
-
    1 
Transfers                                   
Transfers from stage 1 to stage 2   
      -
    
       -
    
       -
    
         -
    
       -
    
       -
    
      -
 
Transfers from stage 1 to stage 3   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 2 to stage 3   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 2 to stage 1   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 3 to stage 2   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 3 to stage 1   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Net changes of the exposure and modifications in credit risk   1    
-
    
-
    
-
    
-
    
-
    1 
Write-off   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Other adjustments   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
At December 31, 2023   2    
-
    
-
    
-
    
-
    
-
    2 

 

F-58

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 08 - FINANCIAL ASSETS AT AMORTISED COST, continued

 

The changes in the gross carrying amount and the corresponding ECL allowance as of December 31, 2022, is as follows:

 

   Stage 1   Stage 2   Stage 3     
   Corporate   Other commercial   Corporate   Other commercial   Corporate   Other commercial   TOTAL 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Gross carrying amount at January 1, 2022   428    
        -
    
         -
    
        -
    
     -
    
        -
    428 
Transfers:                                   
Transfers from stage 1 to stage 2   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 1 to stage 3   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 2 to stage 3   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 2 to stage 1   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 3 to stage 2   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 3 to stage 1   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Net changes of financial assets   32,561    
-
    
-
    
-
    
-
    
-
    32,561 
Write-off   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Other adjustments   2    
-
    
-
    
-
    
-
    
-
    2 
At December 31, 2022   32,991    
-
    
-
    
-
    
-
    
-
    32,991 

 

   Stage 1   Stage 2   Stage 3     
   Corporate   Other
commercial
   Corporate   Other
commercial
   Corporate   Other
commercial
   TOTAL 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
ECL allowance at January 1, 2022   
       -
    
        -
    
        -
    
        -
    
        -
    
       -
    
      -
 
Transfers                                   
Transfers from stage 1 to stage 2   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 1 to stage 3   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 2 to stage 3   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 2 to stage 1   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 3 to stage 2   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Transfers from stage 3 to stage 1   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Net changes of the exposure and modifications in credit risk   1    
-
    
-
    
-
    
-
    
-
    1 
Write-off   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Other adjustments   
-
    
-
    
-
    
-
    
-
    
-
    
-
 
At December 31, 2022   1    
-
    
-
    
-
    
-
    
-
    1 

 

F-59

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 08 - FINANCIAL ASSETS AT AMORTISED COST, continued

 

b.Commercial loans

 

The changes in the gross carrying amount and the corresponding ECL allowance as of December 31, 2023, is as follows: 

 

   Stage 1   Stage 2   Stage 3     
   Corporate   Other
commercial
   Corporate   Other
commercial
   Corporate   Other
commercial
   TOTAL 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Gross carrying amount at January 1, 2023   11,885,781    4,258,677    1,192,595    229,571    683,368    434,597    17,684,589 
Transfers:                                   
Transfers from stage 1 to stage 2   (520,813)   (732,573)   520,813    732,573    
-
    
-
    
-
 
Transfers from stage 1 to stage 3   (4,278)   (40,314)   0    0    4,278    40,314    
-
 
Transfers from stage 2 to stage 3   
-
    
-
    (228,472)   (236,712)   228,472    236,712    
-
 
Transfers from stage 2 to stage 1   505,152    353,714    (505,152)   (353,714)   
-
    
-
    
-
 
Transfers from stage 3 to stage 2   
-
    
-
    93,978    144,542    (93,978)   (144,542)   
-
 
Transfers from stage 3 to stage 1   44    10,951    
-
    
-
    (44)   (10,951)   
-
 
Net changes of financial assets   297,075    528,353    (206,999)   (30,373)   (34,094)   (26,215)   527,747 
Write-off   
-
    
-
    
-
    
-
    (65,102)   (82,530)   (147,632)
Other adjustments   11,131    (3,474)   1    416    
-
    (1,121)   6,953 
At December 31, 2023   11,174,092    4,375,334    866,764    486,303    722,900    446,264    18,071,657 

 

   Stage 1   Stage 2   Stage 3*     
   Corporate   Other
commercial
   Corporate   Other
commercial
   Corporate   Other
commercial
   TOTAL 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
ECL allowance at January 1, 2023   38,718    44,535    61,094    30,262    285,762    201,195    661,566 
Transfers                                   
Transfers from stage 1 to stage 2   (4,221)   (26,250)   11,509    81,669    
-
    
-
    62,707 
Transfers from stage 1 to stage 3   (23)   (1,759)   
-
    
-
    1,723    6,896    6,837 
Transfers from stage 2 to stage 3   
-
    
-
    (19,808)   (40,855)   88,874    66,626    94,837 
Transfers from stage 2 to stage 1   6,715    7,286    (16,407)   (50,448)   
-
    
-
    (52,854)
Transfers from stage 3 to stage 2   
-
    
-
    12,317    24,741    (19,752)   (37,198)   (19,892)
Transfers from stage 3 to stage 1   
-
    131    
-
    
-
    (12)   (1,209)   (1,090)
Net changes of the exposure and modifications in credit risk   (17,720)   17,065    (12,984)   (13,112)   51,564    37,059    61,872 
Write-off   
-
    
-
    
-
    
-
    (65,102)   (82,530)   (147,632)
Other adjustments   199    (3,095)   (7)   (336)   (1)   (3,517)   (6,757)
At December 31, 2023   23,668    37,913    35,714    31,921    343,056    187,322    659,954 

 

*ECL allowance of corporate loans in stage 3, includes MCh$155,903 from cash flow discounted methodology.

 

F-60

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 08 - FINANCIAL ASSETS AT AMORTISED COST, continued

 

The changes in the gross carrying amount and the corresponding ECL allowance as of December 31, 2022, is as follows:

 

   Stage 1   Stage 2   Stage 3     
   Corporate   Other
commercial
   Corporate   Other
commercial
   Corporate   Other
commercial
   TOTAL 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Gross carrying amount at January 1, 2022   10,377,271    4,716,168    1,411,363    233,158    551,237    364,016    17,653,213 
Transfers:                                   
Transfers from stage 1 to stage 2   (539,387)   (492,763)   539,387    492,763    
-
    
-
    
-
 
Transfers from stage 1 to stage 3   (2,169)   (57,501)   
-
    
-
    2,169    57,501    
-
 
Transfers from stage 2 to stage 3   
-
    
-
    (234,165)   (256,444)   234,165    256,444    
-
 
Transfers from stage 2 to stage 1   397,703    350,391    (397,703)   (350,391)   
-
    
-
    
-
 
Transfers from stage 3 to stage 2   
-
    
-
    27,958    154,166    (27,958)   (154,166)   
-
 
Transfers from stage 3 to stage 1   
-
    369    
-
    
-
    
-
    (369)   
-
 
Net changes of financial assets   735,541    (262,145)   (154,244)   (44,096)   (9,790)   (14,601)   250,665 
Write-off   
-
    
-
    
-
    
-
    (66,456)   (74,191)   (140,647)
Other adjustments   (83,178)   4,158    (1)   415    1    (37)   (78,642)
At December 31, 2022   11,885,781    4,258,677    1,192,595    229,571    683,368    434,597    17,684,589 

 

   Stage 1   Stage 2   Stage 3*     
   Corporate   Other
commercial
   Corporate   Other
commercial
   Corporate   Other
commercial
   TOTAL 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
ECL allowance at January 1, 2022   50,052    38,597    101,334    14,655    222,516    176,211    603,365 
Transfers                                   
Transfers from stage 1 to stage 2   (7,575)   (31,569)   19,943    82,410    
-
    
-
    63,209 
Transfers from stage 1 to stage 3   (13)   (2,858)   
-
    
-
    666    12,082    9,877 
Transfers from stage 2 to stage 3   
-
    
-
    (19,924)   (50,214)   76,362    84,285    90,509 
Transfers from stage 2 to stage 1   12,752    6,295    (28,387)   (42,778)   
-
    
-
    (52,118)
Transfers from stage 3 to stage 2   
-
    
-
    10,409    15,418    (9,992)   (34,993)   (19,158)
Transfers from stage 3 to stage 1   
-
    15    
-
    
-
    
-
    (303)   (288)
Net changes of the exposure and modifications in credit risk   (16,913)   30,964    (22,255)   10,385    62,668    34,611    99,460 
Write-off   
-
    
-
    
-
    
-
    (66,456)   (74,191)   (140,647)
Other adjustments   415    3,091    (26)   386    (2)   3,493    7,357 
At December 31, 2022   38,718    44,535    61,094    30,262    285,762    201,195    661,566 

 

*ECL allowance of corporate loans in stage 3, includes MCh$105,837 from cash flow discounted methodology.

 

F-61

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 08 - FINANCIAL ASSETS AT AMORTISED COST, continued

 

c.Mortgage loans

 

The changes in the gross carrying amount and the corresponding ECL allowance as of December 31, 2023, is as follows:

 

   Stage1   Stage2   Stage3   TOTAL 
   MCh$   MCh$   MCh$   MCh$ 
Gross carrying amount at January 1, 2023  14,672,080   367,467   689,462   15,729,009 
Transfers:                
Transfers from stage 1 to stage 2   (2,265,541)   2,265,541    -    - 
Transfers from stage 1 to stage 3   (108,610)   
-
    108,610    
-
 
Transfers from stage 2 to stage 3   
-
    (397,175)   397,175    
-
 
Transfers from stage 2 to stage 1   936,562    (936,562)   
-
    
-
 
Transfers from stage 3 to stage 2   
-
    419,626    (419,626)   
-
 
Transfers from stage 3 to stage 1   20,596    
-
    (20,596)   
-
 
Net changes of financial assets   1,377,161    (5,294)   7,851    1,379,718 
Write-off   
-
    
-
    (38,193)   (38,193)
Other adjustments   3,475    (418)   (152)   2,905 
At December 31, 2023   14,635,723    1,713,185    724,531    17,073,439 

 

   Stage 1   Stage 2   Stage 3   TOTAL 
   MCh$   MCh$   MCh$   MCh$ 
ECL allowance at January 1, 2023   19,388    10,462    132,906    162,756 
Transfers                    
Transfers from stage 1 to stage 2   (12,382)   58,302    -    45,920 
Transfers from stage 1 to stage 3   (848)   
-
    6,813    5,965 
Transfers from stage 2 to stage 3   
-
    (18,422)   35,303    16,881 
Transfers from stage 2 to stage 1   6,893    (57,982)   
-
    (51,089)
Transfers from stage 3 to stage 2   
-
    58,566    (71,378)   (12,812)
Transfers from stage 3 to stage 1   135    
-
    (1,414)   (1,279)
Net changes of the exposure and modifications in credit risk   (4,536)   2,490    90,071    88,025 
Write-off   
-
    
-
    (38,193)   (38,193)
Other adjustments   1    (45)   3    (41)
At December 31, 2023   8,651    53,371    154,111    216,133 

 

F-62

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 08 - FINANCIAL ASSETS AT AMORTISED COST, continued

 

The changes in the gross carrying amount and the corresponding ECL allowance as of December 31, 2022, is as follows:

 

   Stage 1   Stage 2   Stage 3   TOTAL 
   MCh$   MCh$   MCh$   MCh$ 
Gross carrying amount at January 1, 2022   12,966,600    367,837    541,737    13,876,174 
Transfers:                    
Transfers from stage 1 to stage 2   (770,851)   770,851    -    - 
Transfers from stage 1 to stage 3   (127,190)   
-
    127,190    
-
 
Transfers from stage 2 to stage 3   
-
    (326,428)   326,428    
-
 
Transfers from stage 2 to stage 1   752,897    (752,897)   
-
    
-
 
Transfers from stage 3 to stage 2   
-
    289,978    (289,978)   
-
 
Transfers from stage 3 to stage 1   588    
 
    (588)   
-
 
Net changes of financial assets   1,854,186    18,544    6,882    1,879,612 
Write-off   
-
    
 
    (22,282)   (22,282)
Other adjustments   (4,150)   (418)   73    (4,495)
At December 31, 2022   14,672,080    367,467    689,462    15,729,009 

 

   Stage 1   Stage 2   Stage 3   TOTAL 
   MCh$   MCh$   MCh$   MCh$ 
ECL allowance at January 1, 2022   25,385    12,728    105,545    143,658 
Transfers                    
Transfers from stage 1 to stage 2   (7,352)   26,822    -    19,470 
Transfers from stage 1 to stage 3   (2,210)   -    10,838    8,628 
Transfers from stage 2 to stage 3   
-
    (20,901)   30,498    9,597 
Transfers from stage 2 to stage 1   6,022    (30,066)   
-
    (24,044)
Transfers from stage 3 to stage 2   
-
    19,302    (35,285)   (15,983)
Transfers from stage 3 to stage 1   4    
-
    (233)   (229)
Net changes of the exposure and modifications in credit risk   (2,464)   2,585    43,782    43,903 
Write-off   
-
    
-
    (22,282)   (22,282)
Other adjustments   3    (8)   43    38 
At December 31, 2022   19,388    10,462    132,906    162,756 

 

F-63

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 08 - FINANCIAL ASSETS AT AMORTISED COST, continued

 

d.Consumer loans

 

The changes in the gross carrying amount and the corresponding ECL allowance as of December 31, 2023, is as follows:

 

   Stage 1   Stage 2   Stage 3   TOTAL 
   MCh$   MCh$   MCh$   MCh$ 
Gross carrying amount at January 1, 2023   4,826,096    217,866    238,850    5,282,812 
Transfers:                    
Transfers from stage 1 to stage 2   (1,189,650)   1,189,650    
-
    
-
 
Transfers from stage 1 to stage 3   (61,922)   
-
    61,922    
-
 
Transfers from stage 2 to stage 3   
-
    (376,383)   376,383    
-
 
Transfers from stage 2 to stage 1   282,491    (282,491)   
-
    
-
 
Transfers from stage 3 to stage 2   
-
    82,015    (82,015)   
-
 
Transfers from stage 3 to stage 1   3,629    
-
    (3,629)   
-
 
Net changes of financial assets   651,516    (40,384)   (24,502)   586,630 
Write-off   
-
    
-
    (271,123)   (271,123)
Other adjustments   (4)   3    32    31 
At December 31, 2023   4,512,156    790,276    295,918    5,598,350 

 

   Stage 1   Stage 2   Stage 3   TOTAL 
   MCh$   MCh$   MCh$   MCh$ 
ECL allowance at January 1, 2023   94,203    73,973    160,768    328,944 
Transfers:                    
Transfers from stage 1 to stage 2   (89,169)   198,290    0    109,121 
Transfers from stage 1 to stage 3   (3,917)   0    9,723    5,806 
Transfers from stage 2 to stage 3   0    (155,653)   225,902    70,249 
Transfers from stage 2 to stage 1   15,328    (78,238)   0    (62,910)
Transfers from stage 3 to stage 2   0    33,946    (56,076)   (22,130)
Transfers from stage 3 to stage 1   521    0    (2,003)   (1,482)
Net changes of the exposure and modifications in the credit risk   40,463    11,580    65,730    117,773 
Write-off   0    0    (271,123)   (271,123)
Other adjustments   0    (1)   15    14 
At December 31, 2023   57,429    83,897    132,936    274,262 

 

F-64

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 08 - FINANCIAL ASSETS AT AMORTISED COST, continued

 

The changes in the gross carrying amount and the corresponding ECL allowance as of December 31, 2022, is as follows:

 

   Stage1  Stage2  Stage3  TOTAL
   MCh$  MCh$  MCh$  MCh$
Gross carrying amount at January 1, 2022   4,603,589    178,519    217,139    4,999,247 
Transfers:                    
Transfers from stage 1 to stage 2   (658,444)   658,444    
-
    
-
 
Transfers from stage 1 to stage 3   (34,730)   
-
    34,730    
-
 
Transfers from stage 2 to stage 3   
-
    (336,208)   336,208    
-
 
Transfers from stage 2 to stage 1   342,438    (342,438)   
-
    
-
 
Transfers from stage 3 to stage 2   
-
    113,277    (113,277)   
-
 
Transfers from stage 3 to stage 1   16,545    
-
    (16,545)   
-
 
Net changes of financial assets   556,707    (53,732)   (44,453)   458,522 
Write-off   
-
    
-
    (174,919)   (174,919)
Other adjustments   (9)   4    (33)   (38)
At December 31, 2022   4,826,096    217,866    238,850    5,282,812 

  

   Stage 1  Stage 2  Stage 3  TOTAL
   MCh$  MCh$  MCh$  MCh$
ECL allowance at January 1, 2022   125,939    38,197    140,275    304,411 
Transfers:                    
Transfers from stage 1 to stage 2   (91,772)   166,623    
-
    74,851 
Transfers from stage 1 to stage 3   (8,244)   
-
    17,516    9,272 
Transfers from stage 2 to stage 3   
-
    (140,415)   175,093    34,678 
Transfers from stage 2 to stage 1   21,587    (87,763)   
-
    (66,176)
Transfers from stage 3 to stage 2   
-
    41,172    (63,765)   (22,593)
Transfers from stage 3 to stage 1   498    
-
    (15,308)   (14,810)
Net changes of the exposure and modifications in the credit risk   46,196    56,153    81,891    184,240 
Write-off   
-
    
-
    (174,920)   (174,920)
Other adjustments   (1)   6    (14)   (9)
At December 31, 2022   94,203    73,973    160,768    328,944 

 

In November, the Bank updated the macro-economic information and scenarios, resulting in a decrease of ECL allowance amounting of MCh$50,935, due to better projections of economic activity. Also, the Bank has updated significant increase in credit risk threshold (SICR), which resulting in a decrease in ECL allowance amounted of MCh$863. Moreover, the Bank has implement both threshold type (relative and absolute) for SICR assessment, using OR criteria (prior was based on AND criteria) generating an increase of ECL allowance amounted of MCh$22,175. As of December 31, 2023, the Bank maintains MCh$93,614 in residual overlays, to cover certain defaulted loans from mortgage and other commercial portfolios.

 

In the course of 2022, the Bank updated the macro-economic information and scenarios, resulting in an increase of ECL allowance of MCh$73,000, which were covered with post-model adjustment previously recorded. As of December 31, 2022 the Bank maintained MCh$91,351 in residual overlays, to face future macro-economic information and scenarios updates and to cover certain defaulted loans from mortgage and other commercial portfolios.

 

F-65

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 09 - INVESTMENTS IN ASSOCIATES AND OTHER COMPANIES

 

Investments in associates and other companies are shown in the following table:

 

  

Ownership interest

As of December 31,

 

Carrying value

As of December 31,

 

Profit and loss

As of December 31,

  

2023

%

 

2022

%

 

2021

%

 

2023

MCh$

 

2022

MCh$

 

2021

MCh$

 

2023

MCh$

 

2022

MCh$

 

2021

MCh$

Redbanc S.A. (*)   33.43    33.43    33.43    4,168    3,800    3,321    255    572    472 
Transbank S.A. (*)   25.00    25.00    25.00    32,736    27,732    21,288    5,007    6,508    (3,046)
Centro de Compensación Automatizado S.A.   33.33    33.33    33.33    4,863    5,172    3,664    1,689    1,567    876 
Sociedad Interbancaria de Depósito de Valores S.A.   29.29    29.29    29.29    2,615    1,949    1,769    505    442    344 
Cámara de Compensación de Alto Valor S.A.   15.00    15.00    15.00    1,199    1,110    1,008    88    140    58 
Administrador Financiero del Transantiago S.A.   20.00    20.00    20.00    4,285    3,169    3,134    726    804    437 
Servicios de Infraestructura de Mercado OTC S.A.   12.48    12.48    12.48    1,824    1,682    1,561    134    109    33 
Subtotal                  51,690    44,614    35,745    8,404    10,142    (826)
Shares or rights in other companies                                             
Bladex                  -    -    -    
 
    -    188 
Stock Exchanges                  3,575    1,964    1,941    349    168    163 
Others                  19    8    8    10    -    - 
Total                  55,284    46,586    37,694    8,763    10,310    (475)

 

(*)In December 2021, the Bank reclassified its participation in Redbanc S.A. and Transbank S.A. as Investment in associates, after its prior decision to classify them as “Non-current assets held for sale and discontinued operations”, due to lack of buyers. See Note 1 v) and Note 39.

 

In April 22, 2021, Transbank held an extraordinary shareholders meeting, were the members approved a capital increase of MCh$30,000. In June 22, 2021, at the ordinary Board of Directors meeting, the Bank approved the contribution, the first contribution was made on July for MCh$2,500 and the second on September for MCh$4,999.

 

a.Equity instruments at fair value through other comprehensive income

 

As described in Note 1 g), the Bank has elected to measure equity instruments at FVOCI and thus present in OCI changes in the fair value. Those equity investment are considered “strategic investments”, are not held for trading and are not material.

 

Dividends are recognised in the income statements under “Income from investments in associates and other companies”.

 

The fair value of these equity investments is as follows:

 

   December 31,
   2023  2022
   MCh$  MCh$
Stock exchange   3,575    1,964 
Others   19    8 
Total   3,594    1,972 

 

F-66

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 09 - INVESTMENTS IN ASSOCIATES AND OTHER COMPANIES, continued

 

b.Summary of financial information of associates as of and for the years ended December 31, 2023, 2022 and 2021:

 

   As of December 31, 
   2023   2022   2021 
   Assets   Liabilities    Equity   Net
income
   Assets   Liabilities   Equity   Net
income
   Assets   Liabilities   Equity   Net
income
 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Redbanc S.A.   27,330    14,862    11,712    756    30,518    19,150    9,657    1,711    28,410    18,475    8,522    1,413 
Transbank S.A.   1,409,045    1,278,102    111,143    19,800    14,982,071    13,872,786    848,977    260,308    1,317,587    1,232,689    97,337    (12,439)
Centro de Compensación Automatizado S.A.   17,362    3,280    9,024    5,058    19,342    4,295    10,345    4,702    13,247    2,519    8,100    2,628 
Sociedad Interbancaria de Depósito de Valores S.A.   8,389    -    7,205    1,184    7,717    463    5,746    1,508    6,676    358    5,143    1,175 
Cámara de Compensación de Alto Valor S.A.   9,167    1,343    7,252    572    8,357    1,004    6,423    930    7,569    931    6,246    392 
Administrador Financiero del Transantiago S.A.   67,582    47,241    16,725    3,616    60,738    40,113    16,604    4,021    54,437    35,279    17,233    1,925 
Servicios de Infraestructura de Mercado OTC S.A.   32,888    18,578    13,250    1,060    16,631    3,418    13,210    3    35,640    23,023    12,246    371 
Total   1,571,763    1,363,406    176,311    32,046    15,125,374    13,941,229    910,962    273,183    1,463,566    1,313,274    154,827    (4,535)

 

c.Restrictions over the ability of associated companies to transfer funds to investors

 

There are no significant restrictions regarding the capacity of associates to transfer funds, whether in cash dividends, refund of loans, or advance payments to the Bank.

 

d.Activity with respect to investments in other companies in 2023, 2023 and 2022 is as follows:

 

   As of December 31,
   2023  2022  2021
   MCh$  MCh$  MCh$
          
Opening balance as of January 1,   46,586    37,694    12,987 
Acquisition of investments   
-
    
-
    27,233 
Sale of investments   
-
    
-
    (136)
Participation in income   8,404    10,310    (475)
Dividends received   (2,944)   526    506 
Other adjustments   3,238    (1,944)   (2,421)
Closing balances as of December 31,   55,284    46,586    37,694 

 

F-67

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 10 - INTANGIBLE ASSETS

 

As of December 31, 2023 and 2022, the composition of intangible assets is as follows:

 

         As of December 31, 2023
  

Average

remaining

useful life

 

Net opening

balance as of

January 1,
 2021

  Gross
balance
  Accumulated
amortisation
  Net balance
      MCh$  MCh$  MCh$  MCh$
Software development   2    107,789    378,800    (281,249)   97,551 
Total        107,789    378,800    (281,249)   97,551 

 

         As of December 31, 2022
  

Average

remaining

useful life

 

Net opening
balance as of

January 1,
2021

  Gross
balance
  Accumulated
amortisation
  Net balance
      MCh$  MCh$  MCh$  MCh$
Software development   2    95,411    351,309    (243,520)   107,789 
Total        95,411    351,309    (243,520)   107,789 

 

The changes in the value of intangible assets during the periods ended December 31, 2023 and December 31, 2022 is as follows:

 

i.Gross balance

 

Gross balances  Software
development
   MCh$
Balances as of January 1, 2023   351,309 
Acquisitions   45,067 
Disposals and impairment   (5,415)
Other   (12,161)
Balances as of December 31, 2023   378,800 
      
Balances as of January 1, 2022   294,745 
Acquisitions   54,899 
Disposals and impairment   (145)
Other   1,810 
Balances as of December 31, 2022   351,309 

 

ii.Accumulated amortisation

 

Accumulated amortisation  Software
development
   MCh$
Balances as of January 1, 2023   (243,520)
Year’s amortisation   (53,393)
Disposals and impairment   5,415 
Impairment   (1,912)
Other changes   12,161 
Balances as of December 31, 2023   (281,249)
      
Balances as of January 1, 2022   (199,334)
Year’s amortization   (42,376)
Other changes   (1,810)
Balances as of December 31, 2022   (243,520)

 

The Bank has no restriction on intangible assets as of December 31, 2023 and 2022. Additionally, intangible assets have not been pledged as guarantee for fulfillment of financial liabilities, and the Bank has no debt related to Intangible assets as of those dates.

 

F-68

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 11 - FIXED ASSETS

 

As of December 31, 2023 and 2022, the composition of property, plant, and equipment balances is as follows:

 

      As of December 31, 2023
  

Net opening balance as of

January 1,
2023

  Gross balance  Accumulated
depreciation
 

Net

balance

   MCh$  MCh$  MCh$  MCh$
Buildings   145,800    318,881    (173,263)   145,618 
Land   15,021    14,631    
-
    14,631 
Equipment   48,278    343,038    (275,287)   67,751 
Other   28,996    99,732    (75,909)   23,823 
Total   238,095    776,282    (524,459)   251,823 

 

      As of December 31, 2022
  

Net opening balance as of

January 1,
2022

  Gross balance  Accumulated
depreciation
  Net
balance
   MCh$  MCh$  MCh$  MCh$
Buildings   144,731    311,363    (165,563)   145,800 
Land   15,478    15,021    
-
    15,021 
Equipment   57,569    296,022    (247,744)   48,278 
Other   19,161    99,536    (70,540)   28,996 
Total   236,939    721,942    (483,847)   238,095 

 

The changes in the value of property, plant, and equipment as of December 31, 2023 and 2022 is as follows:

 

i.Gross balance

 

2023  Buildings  Land  Equipment  Other  Total
   MCh$  MCh$  MCh$  MCh$  MCh$
Balances as of January 1, 2023   311,363    15,021    296,022    99,536    721,942 
Additions   31,574    
-
    25,697    17,155    74,426 
Disposals   (14,746)   (390)   (1,440)   (3,510)   (20,086)
Impairment due to damage   
-
    
-
    
-
    
-
    
-
 
Other   (9,310)   
-
    22,759    (13,449)   0 
Balances as of December 31, 2023   318,881    14,631    343,038    99,732    776,282 

 

2022  Buildings  Land  Equipment  Other  Total
   MCh$  MCh$  MCh$  MCh$  MCh$
Balances as of January 1, 2022   306,153    15,478    278,176    82,433    682,240 
Additions   26,690    
-
    14,941    16,762    58,393 
Disposals   (15,684)   (457)   (410)   (2,139)   (18,690)
Impairment due to damage   
-
    
-
    
-
    
-
    
-
 
Other   (5,796)   
-
    3,315    2,480    (1)
Balances as of December 31, 2022   311,363    15,021    296,022    99,536    721,942 

 

ii.Accumulated depreciation

 

2023  Buildings  Land  Equipment  Other  Total
   MCh$  MCh$  MCh$  MCh$  MCh$
Balances as of January 1, 2023   (165,563)   
-
    (247,744)   (70,540)   (483,847)
Depreciation charges in the period   (21,603)   
-
    (28,674)   (8,778)   (59,055)
Sales and disposals in the period   13,903    
-
    1131    3,409    18,443 
Other   
-
    
-
    
-
    
-
    
-
 
Balances as of December 31, 2023   (173,263)   
-
    (275,287)   (75,909)   (524,459)

 

2022  Buildings  Land  Equipment  Other  Total
   MCh$  MCh$  MCh$  MCh$  MCh$
Balances as of January 1, 2022   (161,422)   
-
    (220,607)   (63,272)   (445,301)
Depreciation charges in the period   (19,481)   
-
    (27,498)   (9,318)   (56,297)
Sales and disposals in the period   15,340    
-
    361    2,050    17,751 
Other   
-
    
-
    
-
    
-
    
-
 
Balances as of December 31, 2022   (165,563)   
-
    (247,744)   (70,540)   (483,847)

 

F-69

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 12 - RIGHT OF USE ASSETS AND OBLIGATION FOR LEASE CONTRACTS

 

The composition of the right of use assets as of December 31, 2023 and 2022 is as follows:

 

      As of December 31, 2023
2023 

Opening balances as of

January 1,
 2023

  Gross balance  Accumulated
depreciation
  Net balance
   MCh$  MCh$  MCh$  MCh$
Land and building   133,795    215,411    (114,962)   100,449 
Other   
-
    
-
    
-
    
-
 
Total   133,795    215,411    (114,962)   100,449 

 

      As of December 31, 2022
2022 

Opening balances as of

January 1,
 2022

  Gross balance  Accumulated
depreciation
  Net balance
   MCh$  MCh$  MCh$  MCh$
Land and building   137,879    231,603    (97,808)   133,795 
Other   
-
    
-
    
-
    
-
 
Total   137,879    231,603    (97,808)   133,795 

 

The movement of the right of use assets under lease during the 2023 and 2022 period, is as follows:

 

i.Gross balance

 

2023  Land and building  Other  Total
   MCh$  MCh$  MCh$
Balances as of January 1, 2023   231,603    
-
    231,603 
Additions   11,720    
-
    11,720 
Disposals   (27,912)   
-
    (27,912)
Impairment   
-
    
-
    
-
 
Other   
-
    
-
    
-
 
Balances as of December 31, 2023   215,411    
-
    215,411 

 

2022  Land and building  Other  Total
   MCh$  MCh$  MCh$
Balances as of January 1, 2022   212,446    
-
    212,446 
Additions   31,207    
-
    31,207 
Disposals   (12,050)   
-
    (12,050)
Impairment   
-
    
-
    
-
 
Other   
-
    
 
    
-
 
Balances as of December 31, 2022   231,603    
-
    231,603 

 

ii.Accumulated amortisation

 

2023  Land and building  Other  Total
   MCh$  MCh$  MCh$
Balances as of January 1, 2023   (97,808)   
-
    (97,808)
Amortisation for the period   (31,314)   
-
    (31,314)
Sales and disposals during the period   14,160    
-
    14,160 
Transfers   
-
    
-
    
-
 
Others   
-
    
-
    
-
 
Balances as of December 31, 2023   (114,962)   
-
    (114,962)

 

2022  Land and building  Other  Total
   MCh$  MCh$  MCh$
Balances as of January 1, 2022   (74,567)   
-
    (74,567)
Amortisation for the period   (31,319)   
-
    (31,319)
Sales and disposals during the period   8,078    
-
    8,078 
Transfers   
-
    
-
    
-
 
Others   
-
    
-
    
-
 
Balances as of December 31, 2022   (97,808)   
-
    (97,808)

F-70

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 12 - RIGHT OF USE ASSETS AND OBLIGATION FOR LEASE CONTRACTS, continued

 

a.Lease liability

 

As of December 31, 2023 and 2022, the composition of lease liability balances are composed as follows:

 

   As of December 31,
   2023  2022
    MCh$    MCh$ 
Lease liability   104,516    137,089 
Total   104,516    137,089 

 

b.Expenses associated with assets for the right of use leased assets and lease liability

 

   As of December 31,
   2023  2022
   MCh$  MCh$
Depreciation   31,314    31,319 
Interests   3,601    2,862 
Short term lease   9,712    5,503 
Total   44,627    39,684 
           

 

c.As of December 31, 2023 and 2022, the maturity level of the lease liability, according to their contractual maturity is as follows:

 

   As of December 31,
   2023  2022
   MCh$  MCh$
Due within 1 year   20,716    25,902 
Due after 1 year but within 2 years   19,696    24,862 
Due after 2 years but within 3 years   17,750    22,093 
Due after 3 years but within 4 years   12,949    19,565 
Due after 4 years but within 5 years   9,964    13,220 
Due after 5 years   23,441    31,447 
Total   104,516    137,089 

 

d.Operational leases – lessor

 

As of December 31, 2023 and 2022, the future minimum lease cash inflows under non-cancellable operating leases are as follows:

 

   As of December 31,
   2023  2022
   MCh$  MCh$
Due within 1 year   1,012    1,090 
Due after 1 year but within 2 years   1,874    1,805 
Due after 2 years but within 3 years   787    582 
Due after 3 years but within 4 years   736    475 
Due after 4 years but within 5 years   522    470 
Due after 5 years   852    1,194 
Total   5,783    5,616 

 

e.As of December 31, 2023 and 2022, the Bank has no financial leases which cannot be unilaterally rescinded.

 

f.The Bank has no restriction on property, plant and equipment as of December 31, 2023 and 2022. Additionally, the property, plant and equipment have not been provided as guarantees of financial liabilities. The Bank has no debt in connection with property, plant and equipment.

 

F-71

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 13 - CURRENT AND DEFERRED TAXES

 

a.Current taxes

 

As of December 31, 2023 and 2022, the Bank recognises taxes payable (recoverable), which is determined based on the currently applicable tax legislation. This amount is recorded net of recoverable taxes, and is shown as follows:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
         
Summary of current tax liabilities (assets)        
Current tax (assets)   (93,604)   (36,514)
Current tax liabilities   257,336    148,680 
           
Total tax payable (recoverable)   163,732    112,166 
           
(Assets) liabilities current taxes detail (net)          
Income tax, tax rate   256,257    147,668 
Minus:          
Provisional monthly payments   (89,631)   (33,021)
Credit for training expenses   (2,242)   (2,039)
Grant credits   (1,371)   (1,160)
Other   719    718 
Total tax payable (recoverable)   163,732    112,166 

 

b.Effect on income

 

The effect of income tax expense on income for the years ended December 31, 2023, 2022 and 2021 is comprised of the following items:

 

   As of December 31, 
   2023   2022   2021 
   MCh$   MCh$   MCh$ 
Income tax expense            
Current tax   238,875    139,961    4,434 
                
Credits (debits) for deferred taxes               
Origination and reversal of temporary differences   (131,195)   (52,181)   226,810 
Valuation provision   
-
    
-
    
-
 
Subtotals   107,680    87,780    231,244 
Tax for rejected expenses (Article No21)   379    236    210 
Other   (10,511)   5,608    (9,790)
Net charges for income tax expense   97,548    93,624    221,664 

 

F-72

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 13 - CURRENT AND DEFERRED TAXES, continued

 

c.Effective tax rate reconciliation

 

The reconciliation between the income tax rate and the effective rate applied in determining tax expenses as of December 31, 2023, 2023 and 2022, is as follows:

 

   For the year ended, 
   2023   2022   2021 
   Tax rate   Amount   Tax rate   Amount   Tax rate   Amount 
   %   MCh$   %   MCh$    %   MCh$ 
                         
Tax calculated over profit before tax   27.00    186,674    27.00    238,415    27.00    290,005 
Price level restatement for tax purposes (1)   (12.19)   (84,289)   (18.70)   (165,164)   (7.56)   (81,235)
Single penalty tax (rejected expenses)   0.05    379    0.03    236    (0.01)   210 
Other   (0.75)   (5,216)   2.28    20,137    0.00    12,684 
Effective tax rates and expenses for income tax   14.14    97,548    10.61    93,624    19.43    221,664 

 

(1)Mainly corresponds to the permanent differences originated from the Tax Capital Monetary Correction and the effect of the bonds received under article 104 of the Tax Law.

 

d.Effect of deferred taxes on comprehensive income

 

Below is a summary of the separate effect of deferred tax on other comprehensive income, showing the asset and liability balances, for the years ended December 31, 2023 and 2022:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Deferred tax assets        
Debt instruments at FVOCI   30,150    76,512 
Cash flow hedges   24,599    35,689 
Total deferred tax assets recognised through other comprehensive income   54,749    112,201 
           
Deferred tax liabilities          
Debt instruments at FVOCI   5,919    (46,976)
Cash flow hedges   47,391    (3,603)
Total deferred tax liabilities recognised through other comprehensive income   53,310    (50,579)
           
Net deferred tax balances in equity   1,439    61,622 
           
Deferred taxes in equity attributable to shareholders of the Bank   1,938    61,821 
Deferred tax in equity attributable to non-controlling interests   (499)   (199)

 

F-73

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 13 - CURRENT AND DEFERRED TAXES, continued

 

e.Effect of deferred taxes on income

 

As of December 31, 2023 and 2022, the Bank has recorded effects for deferred taxes in the financial statements:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Deferred tax assets        
Interests and adjustments   19,679    17,670 
Extraordinary charge-offs   38,421    29,613 
Assets received in lieu of payment   53    1,223 
Property, plant and equipment valuation   6,426    4,708 
Allowance for loan losses   219,226    276,364 
Provision for expenses   77,149    88,372 
Derivatives   275    50 
Leased assets   106,230    95,152 
Subsidiaries tax losses   1,108    5,570 
Right of use assets   27,761    37,070 
Others   2,398    9,444 
Total deferred tax assets   498,726    565,236 
           
Deferred tax liabilities          
Valuation of investments   473    423 
Prepaid expenses   3,829    7,285 
Valuation provision   
-
    3,147 
Derivatives   127,080    289,352 
Lease obligations   27,433    36,183 
Exchange rate adjustments   5,384    8,779 
Other   427    17,162 
Total deferred tax liabilities   164,626    362,331 

 

f.Summary of deferred tax assets and liabilities

 

Below is a summary of the deferred taxes impact on equity and income:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Deferred tax assets        
Recognised through other comprehensive income   54,749    112,201 
Recognised through profit or loss   498,726    565,236 
Total deferred tax assets   553,475    677,437 
           
Deferred tax liabilities          
Recognised through other comprehensive income   53,310    50,579 
Recognised through profit or loss   164,626    326,331 
Total deferred tax liabilities   217,936    412,910 

 

F-74

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 14 - OTHER ASSETS

 

Other Assets includes the following:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Assets available to be granted under the financial leasing agreements   20,988    32,220 
Guarantee deposits (margin accounts) (1)   2,238,900    2,442,325 
Gold investments   819    715 
VAT credit   55,614    44,180 
Prepaid expenses (2)   169,603    245,937 
Valuation adjustments by macro hedge (3)   160,370    160,531 
Pension plan assets   233    542 
Accounts and notes receivable   199,746    184,989 
Brokerage dealer and simultaneous transactions   33,260    243,345 
Other cash submitted guarantess   2    2 
In-progress operation   13,453    31,709 
Other assets (4)   153,619    192,850 
Total   3,046,607    3,579,345 

 

(1)Guarantee deposits (margin accounts) correspond to collateral associated to derivative financial contracts to mitigate the counterparty credit risk and are mainly established in cash. These guarantees operate when mark to market of derivative financial instruments exceed the levels of threshold agreed in the contracts, which could result in the Bank delivering or receiving collateral.

(2)Under this item, the Bank has recorded prepaid expense related to the Santander LATAM Pass programme, which is consumed on a monthly basis in accordance with the client use of Bank’s transactional products and therefore the Bank assigned the respective LATAM Pass miles (loyalty program managed by LATAM Airlines Group S.A.).

(3)Net assets and liabilities fair value valuation subject to macro hedges. See Note 7.

(4)Other assets mainly include settlement of derivatives and other financial transactions.

 

F-75

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 15 - NON CURRENT ASSETS AND DISPOSAL GROUPS FOR SALE

 

The non-current assets held for sales is as follows:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Assets received or awarded in lieu of payment        
Assets received in lieu of payment   16,852    14,231 
Assets awarded at judicial sale   25,637    22,573 
Provision on assets received in lieu of payment or awarded   (26)   (1,182)
Subtotal   42,463    35,622 
Non current assets held for sale          
Assets recovered from leasing for sale   8,982    4,736 
Subtotal   8,982    4,736 
           
Total   51,445    40,358 

 

F-76

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 16 - FINANCIAL LIABILITIES FOR TRADING AT FAIR VALUE THROUGH PROFIT OR LOSS

 

A financial liability is classified as a financial liability at fair value through profit or loss if is held for trading or it is designated by the entity as at fair value through profit or loss (under specified conditions). The Bank has not designated financial liabilities at FVPL.

 

A financial liability is held for trading if it is incurred principally for the purpose of repurchasing it in the near term or it is a derivative. The Bank only has derivatives under this classification, whose purpose is to hedge the exchange rate and interest rate risk related to future obligations.

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Financial derivative contracts        
Forwards   1,258,352    1,818,024 
Swaps   8,255,283    9,497,035 
Call Options   2,726    2,794 
Put Options   5,214    1,467 
Total   9,521,575    11,319,320 

 

As of December 31, 2023 and 2022 the Bank holds the following portfolio of financial liabilities derivative contracts:

 

   As of December 31, 2023 
   Notional amount 
  

On

Demand

  

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   Fair value 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Currency forward   
        -
    15,424,586    11,104,328    15,247,865    3,947,215    1,408,304    2,072,624    49,204,922    1,258,352 
Interest rate swaps   
-
    5,149,926    15,399,286    19,835,190    18,565,396    7,666,659    11,349,882    77,966,339    1,940,320 
Cross currency swaps   
-
    1,915,707    4,813,848    22,440,782    48,295,676    20,620,952    44,005,979    142,092,944    6,314,963 
Call currency options   
-
    192,051    81,368    10,799    
-
    
-
    
-
    284,218    2,726 
Put currency options   
-
    6,518    147,329    157,779    36,650    
-
    
-
    348,276    5,214 
Total   
-
    22,688,788    31,546,159    57,692,415    70,844,937    29,695,915    57,428,485    269,896,699    9,521,575 

 

   As of December 31, 2022 
   Notional amount 
  

On

Demand

  

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   Fair value 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Currency forward   
         -
    10,130,103    7,474,471    10,559,457    4,725,547    1,913,113    2,034,929    36,837,620    1,818,024 
Interest rate swaps   
-
    4,042,822    9,226,258    26,018,228    25,470,384    11,344,275    15,274,620    91,376,587    3,935,401 
Cross currency swaps   
-
    726,140    1,580,644    5,192,387    18,051,948    10,879,098    20,229,246    56,659,463    5,561,634 
Call currency options   
-
    289,795    70,941    10,365    -    
-
    
-
    371,101    2,794 
Put currency options   
-
    68,099    11,304    27,612    
-
    
-
    
-
    107,015    1,467 
Total   
-
    15,256,959    18,363,618    41,808,049    48,247,879    24,136,486    37,538,795    185,351,786    11,319,320 

 

F-77

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 17 - FINANCIAL LIABILITIES AT AMORTISED COST

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Deposits and other demand liabilities        
Checking accounts   11,014,748    11,711,969 
Demand accounts   500,723    630,807 
Other demand deposits   352,865    379,331 
Obligation related to payments cards provision   1,007    6,758 
Other demand liabilities   1,668,483    1,357,361 
Subtotal   13,537,826    14,086,226 
Time deposits and other time liabilities          
Time deposits   15,939,325    12,779,206 
Time savings account   189,757    191,257 
Other time liabilities   8,860    8,327 
Subtotal   16,137,942    12,978,790 
Obligations under repurchase agreements          
Operation with foreign banks   
-
    103,425 
Operation with other Chilean entities   282,584    211,930 
Subtotal   282,584    315,355 
Interbank borrowings          
Loans from chilean financial institutions   46,218    41,317 
Loans from foreign financial institutions   4,271,414    3,239,358 
Loans from Chilean Central Bank   6,048,867    5,584,090 
Subtotal   10,366,499    8,864,765 
Issue debt instruments          
Mortgage finance bonds   1,229    3,798 
Senior bonds   7,925,385    7,080,472 
Mortgage bond   74,431    81,623 
Subtotal   8,001,045    7,165,893 
Other financial liabilities          
Other domestic obligations   296,273    292,417 
Foreign obligations        578 
Subtotal   296,273    292,995 
           
Total   48,622,169    43,704,024 

 

F-78

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 17 - FINANCIAL LIABILITIES AT AMORTISED COST, continued

 

a.Obligations under from repurchase agreements

 

The Bank raises funds by selling financial instruments and committing itself to buy them back at future dates, plus interest at a predetermined rate. As of December 31, 2023 and 2022, obligations related to instruments sold under repurchase agreements are as follows:

 

   As of December 31, 
   2023   2022 
  

From 1 day
to less than

3 months

  

More
than
3 months and

less than

1 year

  

More
than

1 year

   Total  

From 1 day

to less than

3 months

  

More than
3 months and

less than

1 year

  

More
than

1 year

   Total 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Chilean Central Bank and Government securities                    
Chilean Treasury bonds and notes   282,140    101    
    -
    282,511    186,691    109    
     -
    186,800 
Subtotal   282,140    101    
-
    282,511    186,691    109    
-
    186,800 
Other Chilean debt financial securities                                        
Chilean Bank debt financial instruments   73    
-
    
-
    73    84    
-
    
-
    84 
Subtotal   73    
-
    
-
    73    84    
-
    
-
    84 
Foreign financial debt securities                                        
Other foreign debt financial instruments   -    
-
    
-
    
-
    128,471    
-
    
-
    128,471 
Subtotal   -    
-
    
-
    
-
    128,471    
-
    
-
    128,471 
                                         
Total   282,483    101    
-
    282,584    315,246    109    
-
    315,355 

 

F-79

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 17 - FINANCIAL LIABILITIES AT AMORTISED COST, continued

 

b.Interbank borrowings

 

As of December 31, 2023 and 2022 the Interbank borrowings are as follows:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Loans from Chilean Central Bank  6,048,867   5,584,090 
Loans from chilean financial institutions  46,218   41,317 
Loans from foreign financial institutions        
State Bank Of India   693,430    100,653 
Wells Fargo Bank NA   497,833    42,479 
Sumitomo Mitsui Banking Corporation   451,646    42,524 
Citibank N.A.   378,760    - 
Bank of America   362,876    2,313,121 
Standard Chartered Bank Singapur   290,464    - 
The Bank Of New York Mellon   222,953    169,583 
International Finance Corporate   173,417    - 
Commerzbank Ag   170,966    25,349 
The Toronto Dominion Bank   136,525    - 
Barclays Bank Plc London   134,625    84,978 
Zurcher Kantonalbank   132,363    42,650 
Hong Kong and Shanghai Banking   125,736    2,521 
Banco Bilbao Vizcaya Argentaria   88,037    56 
Saudi National Bank   87,550    - 
Bank Of Baroda   70,521    - 
Bayerische Landesbank Ag Munic   70,242    - 
Bank Of Montreal   49,945    - 
Corporacion Andina De Fomento   44,674    - 
Banco Santander Singapur   22,318    19,633 
Standard Chartered Bank. New York   21,934    - 
Banco Santander Hong Kong   9,641    58,326 
Abanca Corporacion Bancaria S.A.   8,791    - 
Taishin International Bank Co.   8,740    - 
Standard Chartered Bank Hong kong   4,906    - 
Korea Exchange Bank   2,416    230 
Banco Santander Central Hispano   1,734    104 
Standard Chartered Bank   1,270    110,224 

Continued…

 

F-80

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 17 - FINANCIAL LIABILITIES AT AMORTISED COST, continued

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Loans from foreign financial institutions, continued        
Bank Of China   1,264    2,540 
Agricultural Bank Of China   1,015    114 
Bank of Tokio Mitsubishi   443    1,164 
Komercni Banka A.S.   392    - 
Australian And New Zeland Banking Group Ltd.   354    - 
Hsbc Bank Plc   333    - 
China Construction Bank   298    102 
Banca Intesa S.P.A.   282    - 
Banco Do Brasil   281    67 
Wachovia Bank Na   266    11,410 
Bbva Bancomer   225    86 
Bangkok Bank Public Company Limited   219    - 
Hua Nan Commercial Bank   211    196 
China Merchants Bank   182    1,146 
Cassa Di Risparmio Di   174    - 
Icici Bank Limited   166    - 
Industrial And Commercial Bank   144    - 
E. Sun Commercial Bank Ltd. ,   121    - 
The Industrial And Commercial   121    - 
Banco De Sabadell, S.A.   107    - 
Bank Of Communications   71    - 
Turkiye Garanti Bankasi   70    70 
Rhb Bank Berhad   61    - 
Export-Import Bank Of Thailand   56    - 
Banco Rio De La Plata S.A.   50    - 
Bank Of India , Mumbai   47    - 
Finansbank A.S.   38    - 
Citic Industrial Bank   37    - 
Shinhan Bank   27    58 
Banco Bilbao Vizcaya Madrid   22    - 
Yapi Ve Kredi Bankasi A.S.   21    - 
Svenka Handelsbanken Estocolmo   3    - 
The Bank Of Nova Scotia   -    199,224 
Banco Santander Brasil   -    7,359 
Industrial Bank Of Korea   -    901 
Shanghai Pudong Development Bank   -    394 
Bank Of Taiwan   -    386 
Kbc Bank Nv   -    243 
Banca Nazionale Del Lavoro   -    233 
Unicredit   -    219 
Bbva Uruguay   -    198 
Bank For Foreign Trade Of Vietnam   -    181 
Intesa Sanpaolo   -    125 
Fortis Bank   -    110 
Credit Agricole Italia   -    90 
Caixabank   -    80 
Taiwan Cooperative Bank   -    73 
Banco Itau Bba S.A.   -    71 
Abn Amro Bank N.V.   -    36 
Kotak Mahindra Bank Limited   -    32 
Banco De Galicia Y Buenos Aires   -    19 
Subtotal   4,271,414    3,239,358 
Total   10,366,499    8,864,765 

 

F-81

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 17 - FINANCIAL LIABILITIES AT AMORTISED COST, continued

 

i.Loans from the Chilean Central Bank

 

In response to the COVID-19 pandemic, the Chilean Central Bank awarded two credit lines for banks to reinforce their liquidity: The first line of credit was the Credit Facility Conditioned to Increase of Loans (FCIC), whose objective was for banks to continue financing households and companies’ loans. The FCIC1 amounted to US$24 billion for the whole banking system and has maturities of up to 4 years and must be secured by government bonds, corporate bonds or highly rated large commercial loans as collateral. The FCIC2 amounted to US$16 billion and was available only for banks which previously disbursed FCIC1. The FCIC3 was announced in January 2021 and amounted to US$10 billion. The second credit line was the Liquidity Credit line (LCL) and was an unsecured loan facility and had maturities of up to 2 years. In addition, the LCL was limited to the aggregate amount of the liquidity reserve requirements of each bank.

 

The loans balances from the Chilean Central Bank by maturity are as follows:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Due within 1 year   6,048,867    
-
 
Due within 1 and 2 year   
-
    5,584,084 
Due within 2 and 3 year   
-
    
-
 
Due within 3 and 4 year   
-
    
-
 
Due after 5 years   
-
    
-
 
Total loans from Chilean Central Bank  6,048,867    5,584,084 

 

ii.Loans from Chilean financial institutions

 

These obligations’ maturities are as follows:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Due within 1 year   46,218    41,318 
Due within 1 and 2 year   
-
    
-
 
Due within 2 and 3 year   
-
    
-
 
Due within 3 and 4 year   
-
    
-
 
Due after 5 years   
-
    
-
 
Total loans from Chilean financial institutions   46,218    41,318 

 

iii.Foreign obligations

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Due within 1 year   3,793,613    3,239,363 
Due within 1 and 2 year   304,384    
-
 
Due within 2 and 3 year   
-
    
-
 
Due within 3 and 4 year   173,417    
-
 
Due after 5 years   
-
    
-
 
Total loans from foreign financial institutions   4,271,414    3,239,363 

 

F-82

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 17 - FINANCIAL LIABILITIES AT AMORTISED COST, continued

 

c.Issued debt instruments

 

Debts classified as current are either demand obligations or will mature in one year or less. All other debts are classified as non-current, The Bank’s debts, both current and non-current, are summarised below:

 

   As of December 31, 2023   As of December 31, 2022 
   Current   Non-current   Total   Current   Non-current   Total 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Mortgage finance bonds   975    254    1,229    2,592    1,206    3,798 
Senior bonds   1,849,062    6,076,323    7,925,385    482,696    6,597,776    7,080,472 
Mortgage bond   
-
    74,431    74,431    7,108    74,515    81,623 
Issued debt instruments   

1,850,037

    6,151,008    8,001,045    492,396    6,673,497    7,165,893 
                               
Other financial liabilities   296,095    178    296,273    292,756    239    292,995 
                               
Total   1,822,096    6,475,222    8,297,318    785,152    6,673,736    7,458,888 

 

i.Mortgage finance bonds

 

These bonds are used to finance mortgage loans. Their principal amounts are amortised on a quarterly basis. The range of maturities of these bonds is between five and twenty years, Loans are indexed to UF and create a yearly interest yield of 5.23% as of December 31, 2023 (5.20% as of December 31, 2022).

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Due within 1 year   975    2,592 
Due after 1 year but within 2 years   

254

    1,039 
Due after 2 year but within 3 years   
-
    167 
Due after 3 year but within 4 years   
-
    
-
 
Due after 4 year but within 5 years   
-
    
-
 
Due after 5 years   
-
    
-
 
Total mortgage bonds   1,229    3,798 

 

ii.Senior bonds

 

The following table shows senior bonds by currency:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Santander bonds in UF   3,632,979    3,510,708 
Santander bonds in USD   2,424,045    2,215,515 
Santander bonds in CHF   637,203    644,780 
Santander bonds in Ch$   619,386    223,467 
Santander bonds in AUD   116,515    122,611 
Current bonds in JPY   323,922    203,512 
Santander bonds in EUR   171,335    159,879 
Total senior bonds   7,925,385    7,080,472 

 

F-83

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 17 - FINANCIAL LIABILITIES AT AMORTISED COST, continued

 

1.Placement of senior bonds

 

In 2023, the Bank issued bonds for UF 7,719,000, CLP 424,400,000,000, USD 30,000,000, and JPY 25,500,000,000, detailed as follows:

 

Series  Currency  Amount  

Term

(years)

  

Issuance rate

(% annual)

   Placement
date
  Series
Maximum
amount
  Maturity date
W3  UF   2,724,000    7.5    1.60   12-01-18  02-21-23  06-01-26
W5  UF   3,790,000    9    1.80   03-01-19  01-19-23  03-01-28
AA13  UF   1,205,000    6    3.40   09-01-23  11-23-23  09-01-29
Total UF      7,719,000                    
U7  CLP   3,000,000,000    5.5    7.00   03-01-22  02-24-23  09-01-27
T18  CLP   75,000,000,000    5.5    7.50   06-01-22  01-09-23  12-01-27
AA7  CLP   67,650,000,000    3.5    6.80   02-24-23  02-24-23  08-01-26
AA1  CLP   100,000,000,000    6.0    6.60   03-13-23  03-13-23  12-01-28
AA3  CLP   100,000,000,000    8.0    6.20   03-16-23  03-16-23  09-01-30
AA10  CLP   25,000,000,000    3.0    7.10   03-01-23  06-09-23  03-01-26
AA8  CLP   32,500,000,000    4.5    6.70   03-01-23  06-13-23  09-01-27
AA2  CLP   18,250,000,000    6.5    6.2   12-01-22  12-05-23  06-01-29
AA9  CLP   3,000,000,000    8.0    6.3   11-01-22  12-20-23  11-01-30
Total CLP      424,400,000,000                    
Bono USD  USD   30,000,000    1.0    5.84   04-12-23  04-19-23  04-19-24
Total USD      30,000,000                    
Bono JPY  JPY   10,500,000,000    1.0    0.60   04-24-23  04-28-23  04-28-24
Bono JPY  JPY   7,000,000,000    2.0    0.78   05-24-23  05-30-23  05-30-25
Bono JPY  JPY   8,000,000,000    2.0    0.78   10-20-23  10-27-23  10-27-25
Total JPY      25,500,000,000                    

 

In 2022, the Bank issued bonds for UF 26,326,000, USD 30,000,000, CLP 347,000,000,000 and JPY 3,000,000,000, detailed as follows:

 

Series  Currency  Amount  

Term

(years)

  

Issuance rate

(% annual)

   Placement
date
  Series
Maximum
amount
   Maturity date
T3  UF   5,000,000    11    1.55   06-16-22   5,000,000   01-01-30
W3  UF   2,116,000    7.5    1.60   06-30-22   2,116,000   06-01-26
W5  UF   1,210,000    9    1.80   06-30-22   1,210,000   03-01-28
U2  UF   3,000,000    11.5    2.8   07-28-22   3,000,000   06-01-32
U1  UF   3,000,000    7.5    2.5   08-09-22   3,000,000   06-01-29
T20  UF   5,000,000    11.5    2.65   10-24-22   5,000,000   02-01-34
W4  UF   8,000,000    10.5    2.65   12-09-22   8,000,000   12-01-33
W9  UF   2,000,000    9.5    2.70   07-27-22   2,000,000   06-01-31
Total      29,326,000                 29,326,000    
Bono USD  USD   30,000,000    3    Sofr + 95pb   04-28-22   30,000,000   04-28-25
Total      30,000,000                 30,000,000    
U6  CLP   64,800,000,000    5.5    2.95   06-16-22   64,800,000,000   04-01-26
U5  CLP   100,000,000,000    4.5    2.70   06-29-22   100,000,000,000   04-01-25
U6  CLP   35,200,000,000    5.5    2.95   10-21-22   35,200,000,000   04-01-26
U7  CLP   72,000,000,000    5.5    7   11-16-22   72,000,000,000   04-01-26
T17  CLP   75,000,000,000    10    7.5   11-22-22   75,000,000,000   08-01-32
Total      347,000,000,000                 347,000,000,000    
Bono JPY  JPY   3,000,000,000    3    0.65   09-15-2022   3,000,000,000   09-15-25
Total      3,000,000,000                 3,000,000,000    

 

F-84

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 17 - FINANCIAL LIABILITIES AT AMORTISED COST, continued

 

2.Repurchase of senior bonds

 

During 2023, the Bank repurchased the following bonds:

 

Date  Type  Currency  Amount 
01-13-23  Senior  UF   131,000 
01-19-23  Senior  UF   44,000 
01-13-23  Senior  UF   45,000 
04-26-23  Senior  UF   80,000 
04-28-23  Senior  UF   30,000 
05-02-23  Senior  CLP   91,000,000,000 
07-05-23  Senior  UF   50,000 
12-01-23  Senior  UF   73,000 
12-05-23  Senior  UF   1,000 

 

During 2022, the Bank repurchased the following bonds:

 

Date  Type  Currency  Amount 
01-07-2022  Senior  UF   1,065,000 
01-10-2022  Senior  UF   150,000 
02-03-2022  Senior  $   4,000,000,000 
02-04-2022  Senior  UF   785,000 
02-04-2022  Senior  UF   1,205,000 
02-17-2022  Senior  USD   4,156,000 
03-08-2022  Senior  UF   7,000 
03-09-2022  Senior  UF   5,000 
03-10-2022  Senior  UF   5,000 
03-14-2022  Senior  UF   5,000 
07-28-2022  Senior  UF   70,000 
07-29-2022  Senior  UF   9,000 
08-05-2022  Senior  UF   31,000 
09-07-2022  Senior  UF   602,000 
09-08-2022  Senior  UF   100,000 
09-12-2022  Senior  UF   377,000 
09-27-2022  Senior  UF   93,000 
09-28-2022  Senior  UF   414,000 
10-11-2022  Senior  UF   50,000 
10-12-2022  Senior  UF   43,000 
10-13-2022  Senior  UF   1,000 
10-19-2022  Senior  UF   64,000 
10-20-2022  Senior  UF   181,000 
10-27-2022  Senior  UF   50,000 
11-02-2022  Senior  UF   1,000 
11-07-2022  Senior  UF   2,000 
11-08-2022  Senior  UF   687,000 
11-09-2022  Senior  UF   165,000 
11-15-2022  Senior  UF   1,000 
11-17-2022  Senior  UF   100,000 
11-21-2022  Senior  UF   3,000 
11-23-2022  Senior  UF   400,000 
11-28-2022  Senior  UF   415,000 
12-01-2022  Senior  UF   1,052,000 
12-06-2022  Senior  UF   130,000 
12-13-2022  Senior  UF   348,000 
12-14-2022  Senior  UF   140,000 
12-15-2022  Senior  UF   104,000 
12-16-2022  Senior  UF   291,000 
12-19-2022  Senior  UF   97,000 
12-26-2022  Senior  UF   4,000 
12-28-2022  Senior  UF   60,000 

 

F-85

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 17 - FINANCIAL LIABILITIES AT AMORTISED COST, continued

 

3.The maturities of senior bonds are as follows:

 

    As of December 31,  
    2023     2022  
    MCh$     MCh$  
Due within 1 year     1,849,062       482,696  
Due after 1 year but within 2 years     1,577,424       1,185,935  
Due after 2 year but within 3 years     1,395,929       1,599,241  
Due after 3 year but within 4 years     559,331       1,282,436  
Due after 4 year but within 5 years     573,349       408,607  
Due after 5 years     1,970,290       2,121,557  
Total senior bonds     7,925,385       7,080,472  

 

iii.Mortgage bonds

 

Detail of mortgage bonds per currency is as follows:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Mortgage bonds in UF   74,431    81,623 
Total mortgage bonds   74,431    81,623 

 

1.Allocation of mortgage bonds

 

During 2023 and 2022, the Bank has not placed any mortgage bonds.

 

2.The maturities of Mortgage bonds are as follows

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Due within 1 year   
-
    7,108 
Due after 1 year but within 2 years   13,997    11,411 
Due after 2 year but within 3 years   14,398    11,779 
Due after 3 year but within 4 years   14,812    12,159 
Due after 4 year but within 5 years   15,240    12,551 
Due after 5 years   15,984    26,615 
Total Mortgage bonds   74,431    81,623 

 

F-86

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 18 - REGULATORY CAPITAL FINANCIAL INSTRUMENTS

 

d.Other financial liabilities

 

The composition of other financial obligations, by maturity, is detailed below:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Non-current portion        
Due after 1 year but within 2 years   78    68 
Due after 2 year but within 3 years   86    74 
Due after 3 year but within 4 years   14    84 
Due after 4 year but within 5 years   
-
    13 
Due after 5 years   
-
    
-
 
Non-current portion subtotal   178    239 
Current portion          
Amounts due to credit card operators   171,529    186,237 
Acceptance of letters of credit   
-
    110 
Other long-term financial obligations, short-term portion   124,566    106,409 
Current portion subtotal   296,095    292,756 
           
Total other financial liabilities   296,273    292,995 

 

As of December 31, 2023 and 2022, the Bank’s subordinated bonds classified as current and non-current are summarised below:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Current portion   
-
    
-
 
Non- current portion   1,813,938    1,733,869 
Total subordinated bonds   1,813,938    1,733,869 

 

Detail of the subordinated bonds per currency is as follows:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Subordinated bonds denominated in USD   175,234    169,835 
Subordinated bonds denominated in UF   1,638,705    1,564,034 
Total subordinated bonds   1,813,939    1,733,869 

 

i.Placement of subordinated bonds

 

   Currency  Placement amount   Interest
rate
   Plazo de emisión  Placement
date
  Maturity
date
USTDW70320  UF   3,300,000    3.51%  6 years  01-07-2022  09-01-2028

 

F-87

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 18 - REGULATORY CAPITAL FINANCIAL INSTRUMENTS, continued

 

During 2021, the Bank did not place any subordinated bonds.

 

ii.The Maturities of subordinated bonds

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Due within 1 year   
-
    
-
 
Due after 1 year but within 2 years   
-
    
-
 
Due after 2 year but within 3 years   188,869    
-
 
Due after 3 year but within 4 years   
-
    175,800 
Due after 4 year but within 5 years   110,296    
-
 
Due after 5 years   1,514,774    1,558,069 
Total subordinated bonds   1,813,939    1,733,869 

 

iii.Balances of subordinated bonds

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Balances as of January 1,   1,733,869    1,461,637 
New issues/placements   
-
    101,503 
Accrued interest at effective interés rate   3,947    6,563 
Readjustments accrued by UF or exchange rate   70,550    172,941 
Others   5,572    (8,775)
Balances as of December 31,   1,813,939    1,733,869 

 

F-88

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 19 - PROVISIONS AND CONTINGENT PROVISIONS

 

As of December 31, 2023 and 2022, the composition is as follows:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
         
Provisions for personnel salaries and expenses   81,907    99,424 
Provisions for lawsuits and litigations   4,504    5,533 
Provision for loyalty programmes   38    38 
Provision for operational risks   2,993    5,149 
Provision for other contingencies   19,391    63,232 
Provisions for mandatory dividends   148,921    237,683 
Provision for interest of perpetual bonds   5,112    4,966 
Provisions for contingent loan   21,105    44,997 
Total   283,971    461,022 

 

a.Below is the activity regarding provisions during the years ended December 31, 2023, 2022 and 2021:

 

    Personnel
salaries
and expenses
    Lawsuit and litigations     Loyalty programme     Operational risks     Contingencies     Mandatory Dividend     Interest of
perpetual bonds
    Contingent loan     Total  
    MCh$     MCh$     MCh$     MCh$     MCh$     MCh$     MCh$     MCh$     MCh$  
Balances as of January 1, 2023     99,424       5,533       38       5,149       63,232       237,683       4,966       44,997       461,022  
Provisions established     72,090       556      
 
      1,254       2,133       148,921       15,157       67,403       307,514  
Application of provisions     (72,840 )     (1,585 )    
 
      (3,410 )     (45,974 )     (237,683 )     (15,011 )    
 
      (376,503 )
Provisions released     (15,474 )    
-
     
-
     
-
     
-
     
-
     
-
      (91,269 )     (106,743 )
Other     (1,293 )    
-
     
-
     
-
     
-
     
-
     
-
      (26 )     (1,319 )
Balances as of December 31, 2023     81,907       4,504       38       2,993       19,391       148,921       5,112       21,105       283,971  
Balances as of January 1, 2022     109,001       3,035       38       1,578       52,205       252,740       4,995       40,357       463,949  
Provisions established     121,779       2,963      
-
      4,053       24,365       237,683       30,523       110,211       531,577  
Application of provisions     (132,340 )     (465 )    
-
      (482 )     (13,338 )     (252,740 )     (30,552 )    
-
      (429,917 )
Provisions released     (1,748 )    
-
     
-
     
-
      -       -      
-
      (105,687 )     (107,435 )
Other     2,732      
-
     
-
     
-
     
-
     
-
     
-
      116       2,848  
Balances as of December 31, 2022     99,424       5,533       38       5,149       63,232       237,683       4,966       44,997       461,022  
Balances as of January 1, 2021     102,958       2,411       38      
-
      32,726       164,284      
-
      28,247       330,664  
Provisions established     90,363       624       -       1,578       30,413       252,740       4,995       73,201       453,914  
Application of provisions     (80,768 )     -      
-
     
-
     
-
     
-
     
-
     
-
      (80,768 )
Provisions released     (1,836 )    
-
     
-
     
-
      (10,934 )     (164,284 )    
-
      (63,654 )     (240,708 )
Other     (1,716 )    
-
     
-
     
-
     
-
     
-
     
-
      2,563       847  
Balances as of December 31, 2021     109,001       3,035       38       1,578       52,205       252,740       4,995       40,357       463,949  

 

F-89

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 19 - PROVISIONS AND CONTINGENT PROVISIONS, continued

 

b.Provisions for personnel salaries and expenses includes:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Provision for short-term benefits   79,829    97,866 
Provision for long-term benefits   1,450    926 
Provision for senioruty compensation   585    601 
Provision for other personnel benefits   43    31 
Total   81,907    99,424 

 

c.Provisions for contingent loan risk

 

Provision for contingent loan arise from contingent liabilities and loan commitments. ECL allowance related to contingent loan are included in ECL allowance in the income statements for the year. The contingent portfolio is presented in Note 24.

 

An analysis of changes in the corresponding ECL allowance as of December 31, 2023 and 2022 is as follows:

 

   December 31, 2023 
   Stage 1   Stage 2   Stage 3   TOTAL 
ECL allowance at January 1, 2023  26,316   8,789   9,892   44,997 
Transfer                
Transfers from stage 1 to stage 2   (2,645)   5,559    
-
    2,914 
Transfers from stage 1 to stage 3   (142)   
-
    1,241    1,099 
Transfers from stage 2 to stage 3   
-
    (2,471)   7,507    5,036 
Transfers from stage 2 to stage 1   1,858    (9,253)   
-
    (7,395)
Transfers from stage 3 to stage 2   
-
    2,187    (5,044)   (2,857)
Transfers from stage 3 to stage 1   3    
-
    (213)   (210)
Net changes of the exposure and modifications in credit risk   (14,442)   (1,389)   (6,647)   (22,478)
Write-off   
-
    
-
    
-
    
-
 
Other adjustments   1    (2)   
-
    (1)
At December 31, 2023   10,949    3,420    6,736    21,105 

 

   December 31, 2022 
   Stage 1   Stage 2   Stage 3   TOTAL 
ECL allowance at January 1, 2022  23,029   9,599   7,729   40,357 
Transfer                
Transfers from stage 1 to stage 2   (1,585)   4,719    
-
    3,134 
Transfers from stage 1 to stage 3   (143)   
-
    2,846    2,703 
Transfers from stage 2 to stage 3   
-
    (1,860)   6,124    4,264 
Transfers from stage 2 to stage 1   1,832    (7,467)   
-
    (5,635)
Transfers from stage 3 to stage 2   
-
    3,762    (2,926)   836 
Transfers from stage 3 to stage 1   1    
-
    (78)   (77)
Net changes of the exposure and modifications in credit risk   2,998    35    (3,801)   (768)
Write-off   
-
    
-
    
-
    
-
 
Other adjustments   184    1    -2    183 
At December 31, 2022   26,316    8,789    9,892    44,997 

 

F-90

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 20 - OTHER LIABILITIES

 

The other liabilities line item is as follows:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Accounts and notes payable   312,882    405,878 
Income received in advance   777    901 
Macro-hedge valuation adjustment (1)   68,781    85,725 
Guarantees received (margin accounts) (2)   1,081,226    1,017,968 
Broker dealer and simultaneous transactions   36,819    265,793 
Withholding VAT   44,861    36,814 
Accounts payable insurance companies   7,869    10,893 
In-progress operations   18,191    21,918 
Deferred income   1,902    5,453 
Other liabilities   110,346    190,339 
Total   1,683,654    2,041,682 

 

(1)Valuation balances of net assets and liabilities at market value subject to macro-hedging

(2)Guarantee deposits (margin accounts) correspond to collateral associated to derivative financial contracts to mitigate the counterparty credit risk and are mainly established in cash. These guarantees operate when mark to market of derivative financial instruments exceed the levels of threshold agreed in the contracts, which could result in the Bank delivering or receiving collateral.

 

F-91

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 21 - EQUITY

 

a.Capital

 

As of December 31, 2022, and 2021 the Bank had 188,446,126,794 shares outstanding, all of which are subscribed for and paid in full, amounting to Ch$ 891,303 million. All shares have the same rights and have no preferences or restrictions.

 

The activity with respect to shares during 2023, 2023 and 2022 was as follows:

 

    SHARES
As of December 31,
 
    2023     2022     2021  
Issued as of January 1     188,446,126,794       188,446,126,794       188,446,126,794  
Issuance of paid shares    
-
     
-
     
-
 
Issuance of outstanding shares    
-
     
-
     
-
 
Stock options exercised    
-
     
-
     
-
 
Issued as of December 31,     188,446,126,794       188,446,126,794       188,446,126,794  

 

As of December 31, 2023, 2022 and 2021 the Bank does not have any of its own shares in treasury, nor do any of the consolidated companies.

 

As of December 31, 2023, the shareholder composition was as follows:

 

Corporate Name or Shareholder’s Name   Shares     ADRs (*)     Total     % of
equity holding
 
                         
Santander Chile Holding S.A.     66,822,519,695      
-
      66,822,519,695      
35,46
 
Teatinos Siglo XXI Inversiones S.A.     59,770,481,573      
-
      59,770,481,573      
31,72
 
The Bank of New York Mellon    
 
      12,799,964,871       12,799,964,871      
6,79
 
Bancos por cuenta de terceros     19,416,795,808       -       19,416,795,808      
10,30
 
AFP por cuentas de terceros     18,392,349,767       -       18,392,349,767      
9,76
 
Corredoras de bolsa por cuenta de terceros     5,029,151,233       -       5,029,151,233      
2,67
 
Otros accionistas minoritarios     6,214,863,847      
-
      6,214,863,847      
3,30
 
Total     175,646,161,923       12,799,964,871       188,446,126,794      
100,00
 

 

(*)American Depository Receipts (ADR) are certificates issued by a U.S. commercial bank to be traded on the U.S. securities markets.

 

As of December 31, 2022, the shareholder composition was as follows:

 

Corporate Name or Shareholder’s Name   Shares     ADRs (*)     Total     % of
equity holding
 
Santander Chile Holding S.A.     66,822,519,695      
-
      66,822,519,695       35.46  
Teatinos Siglo XXI Inversiones S.A.     59,770,481,573      
-
      59,770,481,573       31.72  
The Bank New York Mellon    
-
      19,845,850,871       19,845,850,871       10.53  
Banks on behalf of third parties     16,841,385,216      
-
      16,841,385,216       8.94  
Pension funds (AFP) on behalf of third parties     13,742,809,166      
-
      13,742,809,166       7.29  
Stock brokers on behalf of third parties     6,122,497,451      
-
      6,122,497,451       3.25  
Other minority holders     5,300,582,822      
-
      5,300,582,822       2.81  
Total     168,600,275,923       19,845,850,871       188,446,126,794       100.00  

 

(*)American Depository Receipts (ADR) are certificates issued by a U.S. commercial bank to be traded on the U.S. securities markets.

 

F-92

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 21 - EQUITY, continued

 

As of December 31, 2021, the shareholder composition was as follows:

 

Corporate Name or Shareholder’s Name  Shares   ADRs (*)   Total   % of
equity holding
 
Santander Chile Holding S.A.   66,822,519,695    
-
    66,822,519,695    35.46 
Teatinos Siglo XXI Inversiones S.A.   59,770,481,573    
-
    59,770,481,573    31.72 
The Bank New York Mellon   
-
    20,710,338,871    20,710,338,871    10.99 
Banks on behalf of third parties   17,318,500,798    
-
    17,318,500,798    9.19 
Pension funds (AFP) on behalf of third parties   11,949,134,854    
-
    11,949,134,854    6.34 
Stock brokers on behalf of third parties   5,870,596,720    
-
    5,870,596,720    3.12 
Other minority holders   6,004,554,283    
-
    6,004,554,283    3.18 
Total   167,735,787,923    20,710,338,871    188,446,126,794    100.00 

 

(*)American Depository Receipts (ADR) are certificates issued by a U.S. commercial bank to be traded on the U.S. securities markets.

 

b.Dividends

 

The distribution of dividends is detailed in the Consolidated Statements of Changes in Equity.

 

c.As of December 31, 2023, 2022 and 2021 the basic and diluted earnings per share were as follows:

 

   As of December 31, 
   2023   2022   2021 
   MCh$   MCh$   MCh$ 
             
a) Basic earnings per share            
Total attributable to the shareholders of the Bank   579,427    792,276    842,467 
Weighted average number of outstanding shares   188,446,126,794    188,446,126,794    188,446,126,794 
Basic earnings per share (in Ch$)   3.075    4.204    4.471 
Basic earnings per share from continuing operations (in Ch$)   3.075    4.204    4.471 
Basic earnings per share from discontinued operations (in Ch$)   
 
    
-
    
-
 
                
b) Diluted earnings per share               
Total attributable to the shareholders of the Bank   579,427    792,276    842,467 
Weighted average number of outstanding shares   188,446,126,794    188,446,126,794    188,446,126,794 
Adjusted number of shares   188,446,126,794    188,446,126,794    188,446,126,794 
Diluted earnings per share (in Ch$)   3.075    4.204    4.471 
Diluted earnings per share from continuing operations (in Ch$)   3.075    4.204    4.471 
Diluted earnings per share from discontinued operations (in Ch$)   
-
    
-
    
-
 

 

As of December 31, 2023, 2022 and 2021 the Bank does not own instruments with dilutive effects.

 

F-93

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 21 - EQUITY, continued

 

d.Other comprehensive income from available for sale investments and cash flow hedges:

 

   For the years ended December 31, 
   2023   2022   2021 
   MCh$   MCh$   MCh$ 
             
Debt instruments at FVOCI            
As of January 1,   (109,392)   (112,223)   102,855 
Gain (losses) on the re-measurement of debt instruments at FVOCI, before tax   145,257    23,004    (233,109)
Recycling from other comprehensive income to income for the year   
-
    
-
    
-
 
Net realized gains   (125,613)   (20,173)   18,031 
Subtotals   19,644    2,831    (215,078)
Total   (89,748)   (109,392)   (112,223)
                
Cash flow hedges               
As of January 1,   (118,838)   (373,581)   (136,765)
Gains (losses) on the re-measurement of cash flow hedges, before tax   243,366    298,029    (211,122)
Recycling adjustments on cash flow hedges, before tax   (40,112)   (43,286)   (25,694)
Amounts removed from equity and included in carrying amount of non-financial asset (liability) which acquisition or incurrence was hedged as a highly probable transaction   
-
    
-
    
-
 
Subtotals   203,254    254,743    (236,816)
Total   84,416    (118,838)   (373,581)
                
Other comprehensive income, before taxes   (5,332)   (228,230)   (485,804)
                
Income tax related to other comprehensive income components               
Income tax relating to debt instruments at FVOCI   24,231    29,536    31,650 
Income tax relating to cash flow hedges   (22,792)   32,086    100,867 
Total   1,439    61,622    132,517 
                
Other comprehensive income, net of tax   (3,893)   (166,608)   (353,287)
Attributable to:               
Shareholders of the Bank   (5,242)   (167,147)   (353,849)
Non-controlling interest   1,349    539    562 

 

The Bank expects that the results included in “Other comprehensive income” will be reclassified to profit or loss when the specific conditions have been met.

 

e.Other equity instruments issued other than capital

 

As of December 31, 2023 and 2022 the balance of the perpetual bonds was as follow:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
         
Perpetual bond   608,721    590,247 
Totals   608,721    590,247 

 

The perpetual bonds were issued on October 2021.

 

F-94

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 21 - EQUITY, continued

 

Debts classified as current are either demand obligations or will mature in one year or less. All other debts are classified as non-current. The Bank’s debts, both current and non-current, are summarised below:

 

   As of December 31, 2023   As of December 31, 2022 
   Current   Non-current   Total   Current   Non-current   Total 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Perpetual bonds   
-
    608,721    608,721    
-
    590,247    590,247 
Total   
-
    608,721    608,721    
-
    590,247    590,247 

 

The detail of perpetual bonds is as follows:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
US$ Bonds   608,721    590,247 
Total   608,721    590,247 

 

The terms of the perpetual bonds were as follows:

 

Series  Currency  Amount   Terms (years)  

Interest Rate

(Annual)

   Issuance
date
 

Principal
Amount

USD

   Maturity
date
 
AT1 Bond  USD   700,000,000    
-
    4.63   10-21-2021   700,000,000    
-
 
Total USD      700,000,000                 700,000,000      

 

During 2023 and 2022, no partial bond repurchases have been made.

 

The movement of the balance of regulatory capital financial instruments issued as of December 31, 2023 and 2022, is as follows:

 

   2023   2022   2021 
   MCh$   MCh$   MCh$ 
Balances as of January 01,   590,247    598,136    
-
 
New issuances   
 
    
-
    564,356 
Interest rate and fx exchange   18,474    (7,889)   33,780 
Balances as of December 31,   608,721    590,247    598,136 

 

F-95

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 22 - NON-CONTROLLING INTEREST

 

The non-controlling interest included in the equity and the income from the Bank’s subsidiaries is summarised as follows:

 

               Other comprehensive income 
As of December 31, 2023 

Non-

controlling

   Equity   Income  

Debt instruments

at FVOCI

   Deferred tax  

Total other

comprehensive

income

  

Comprehensive

income

 
   %   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Subsidiaries:                            
Santander Corredora de Seguros Limitada   0.25    45    21    -    
-
    
-
    21 
Santander Corredores de Bolsa Limitada   49.00    27,557    2,050    1,109    (299)   810    2,860 
Santander Asesorías Financieras Limitada   0.97    35    31    
-
    
-
    
-
    31 
Santander S.A. Sociedad Securitizadora   0.36    2    (1)   
-
    
-
    
-
    (1)
Klare Corredora de Seguros S.A.   49.90    (858)   (1,213)   
-
    
-
    
-
    (1,213)
Santander Consumer Chile S.A.   49.00    57,420    8,148    
-
    
-
    
-
    8,148 
Subtotal        84,201    9,036    1,109    (299)   810    9,846 
                                    
Santander Gestión de Recaudación y Cobranzas Limitada   100.00    8,518    1,530    
-
    
-
    
-
    1,530 
Bansa Santander S.A.   100.00    28,336    4,087    
-
    
-
    
-
    4,087 
Multiplica Spa   100.00    2,529    (682)   
 
         
 
    (682)
PagoNXT Trade Chile SpA   100.00    1,151    439    -    -    -    439 
Subtotal        40,534    5,374    
-
    
-
    
-
    5,374 
                                    
Total        124,735    14,410    1,109    (299)   810    15,220 

 

               Other comprehensive income 
As of December 31, 2022 

Non-

controlling

   Equity   Income  

Debt instruments

at FVOCI

   Deferred tax  

Total other

comprehensive

income

  

Comprehensive

income

 
   %   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Subsidiaries:                            
Santander Corredora de Seguros Limitada   0.25    201    21    
-
    
-
    
-
    21 
Santander Corredores de Bolsa Limitada   49.41    24,725    1,762    (32)   9    (23)   1,739 
Santander Asesorías Financieras Limitada   0.97    561    47    -    -    -    47 
Santander S.A. Sociedad Securitizadora   0.36    3    (1)   
-
    
-
    
-
    (1)
Klare Corredora de Seguros S.A.   49.90    356    (1,277)   
-
    
-
    
-
    (1,277)
Santander Consumer Chile S.A.   49.00    49,269    10,193    
-
    
-
    
-
    10,193 
Subtotal        75,115    10,745    (32)   9    (23)   10,722 
                                    
Santander Gestión de Recaudación y Cobranzas Limitada   100.00    6,988    2,168    
-
    
-
    
-
    2,168 
Bansa Santander S.A.   100.00    24,250    3,239    
-
    
-
    
-
    3,239 
Multiplica Spa   100.00    3,211    (946)   
-
    -    
-
    (946)
Subtotal        34,449    4,461    
-
    
-
    
-
    4,461 
                                    
Total        109,564    15,206    (32)   9    (23)   15,183 

 

F-96

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 22 - NON-CONTROLLING INTEREST, continued

 

               Other comprehensive income 
As of December 31, 2021 

Non-

controlling

   Equity   Income  

Debt instruments

at FVOCI

   Deferred tax  

Total other

comprehensive

income

  

Comprehensive

income

 
   %   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Subsidiaries:                            
Santander Corredora de Seguros Limitada   0.25    179    5    -    -    -    5 
Santander Corredores de Bolsa Limitada   49.41    22,970    717    (238)   65    (173)   544 
Santander Asesorías Financieras Limitada   0.97    513    21    (152)   41    (111)   (90)
Santander S.A. Sociedad Securitizadora   0.36    1    
-
    
-
    
-
    
-
    
-
 
Klare Corredora de Seguros S.A.   49.90    1,631    (1,270)   
-
    
-
    
-
    (1,270)
Santander Consumer Chile S.A.   49.00    39,080    9,386    
-
    
-
    
-
    9,386 
Subtotal        64,374    8,859    (390)   106    (284)   8,575 
                                    
Santander Gestión de Recaudación y Cobranzas Limitada   100.00    4,820    139    
-
    
-
    
-
    139 
Bansa Santander S.A.   100.00    21,010    1,096    
-
    
-
    
-
    1,096 
Multiplica Spa   100.00    4.156    (133)   
-
    
-
    
-
    (133)
Subtotal        29,986    1,102    
-
    
-
    
-
    1,102 
                                    
Total        94,360    9,961    (390)   106    (284)   9,677 

 

F-97

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 22 - NON-CONTROLLING INTEREST, continued

 

The overview of the financial information of the subsidiaries included in the consolidation of the Bank that possess non-controlling interests is as follows, which does not include consolidation or conforming accounting policy adjustments:

 

   As of December 31, 
   2023   2022   2021 
   Assets   Liabilities   Capital  

Net

income

   Assets   Liabilities   Capital  

Net

income

   Assets   Liabilities   Capital  

Net

income

 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Santander Corredora de Seguros Limitada   31,758    13,895    9,576    8,287    92,541    13,093    71,121    8,327    88,492    13,388    69,129    1,975 
Santander Corredores de Bolsa Limitada   99,325    43,087    52,054    4,184    321,411    270,952    46,863    3,596    98,496    51,649    45,396    1,451 
Santander Asesorias Financieras Limitada   5,023    1,442    354    3,227    60,640    2,725    53,082    4,833    54,731    1,683    50,900    2,148 
Santander S.A. Sociedad Securitizadora   879    345    709    (175)   1,107    398    857    (148)   810    463    455    (108)
Klare Corredora de Seguros S.A.   1,891    3,610    713    (2,432)   2,153    1,440    3,272    (2,559)   3,952    681    5,816    (2,545)
Santander Consumer Chile S.A.   923,790    806,607    100,555    16,628    884,701    784,146    79,755    20,800    742,700    662,945    60,588    19,167 
Santander Gestión de Recaudación y Cobranzas Ltda.   11,273    2,755    6,988    1,530    8,037    1,049    4,820    2,168    6,636    1,816    4,681    139 
Bansa Santander S.A.   292,937    264,601    24,249    4,087    213,661    189,411    21,011    3,239    103,927    82,917    19,914    1,096 
Multiplica Spa   3,518    989    3,211    (682)   4,337    1,126    4,157    (946)   4,409    253    4,289    (133)
PagoNXT Trade Chile SpA   2,290    1,139    712    439    
-
    
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Total   1,372,684    1,138,470    199,121    35,093    1,588,588    1,264,340    284,938    39,310    1,100,153    815,795    261,168    23,190 

 

F-98

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 23 - MATURITY OF FINANCIAL ASSETS AND LIABILITIES

 

As of December 31, 2023 and 2022, the detail of the maturities of assets and liabilities is as follows:

 

As of December 31, 2023  On Demand  

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 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Financial assets                                
Cash and deposits in banks   2,723,282    
-
    
-
    
-
    
-
    
-
    
-
    2,723,282 
Cash items in process of collection   812,524    
-
    
-
    
-
    
-
    
-
    
-
    812,524 
Financial assets for trading at FVTPL                                        
Financial derivative contracts and hedge contracts (1)   
-
    383,845    807,016    1,548,923    3,046,056    1,413,070    3,526,105    10,725,015 
Debt financial instruments   
-
    211    
-
    2,275    31,031    1,432    63,359    98,308 
Financial assets at FVOCI                                        
Debt financial instruments   
-
    2,277,301    10,319    319    668,856    491,471    1,087,759    4,536,025 
Other financial instruments   
 
    
 
    
 
    66,685    13,566    19,692    5,439    105,382 
Financial assets at amortised cost (2)                                        
Debt financial instruments   
-
    
-
    
-
    3,724,781    4,453,843    
-
    
-
    8,178,624 
Interbank loans   49    68,391    
-
    
-
    
-
    
-
    
-
    68,440 
Loans and account receivable from customers   872,591    3,304,077    3,178,674    5,552,061    8,293,975    4,666,845    14,875,223    40,743,446 
Guarantee deposits (margin accounts)   2,238,900    
-
    
-
    
-
    
-
    
-
    
-
    2,238,900 
Total financial assets   6,647,346    6,033,825    3,996,009    10,895,044    16,507,327    6,592,510    19,557,885    70,229,946 
                                         
Financial liabilities                                        
Cash items in process of being cleared   775,082    
-
    
-
    
-
    
-
    
-
    
-
    775,082 
Financial liabilities for trading at FVTPL                                      - 
Financial derivative contracts and hedge contracts (1)   
-
    376,279    1,170,614    2,443,279    3,056,317    1,526,321    3,415,532    11,988,342 
Financial liabilities at amortised cost                                      - 
Deposits and other demand liabilities   13,537,826    
-
    
-
    
-
    
-
    
-
    
-
    13,537,826 
Time deposits and other time liabilities   328,242    7,999,764    3,689,743    3,950,166    138,320    3,364    28,343    16,137,942 
Obligations under repurchase agreements   
-
    282,483    101    
-
    
-
    
-
    
-
    282,584 
Interbank borrowings   18,220    42,730    4,006,532    5,821,216    304,384    173,417    
-
    10,366,499 
Issued debt instruments (3)   
-
    291,687    285,923    1,272,427    3,183,069    1,314,205    3,467,672    9,814,983 
Other financial liabilities   
-
    296,095    
-
    
-
    164    14    
-
    296,273 
Lease liabilities   
-
    
-
    
-
    20,716    37,446    22,913    23,441    104,516 
Guarantees received (margin accounts)   1,081,226    
-
    
-
    
-
    
-
    
-
    
-
    1,081,226 
Total financial liabilities   15,740,596    9,289,038    9,152,913    13,507,804    6,719,700    3,040,234    6,934,988    64,385,273 

 

(1)Includes derivative contracts for trading purposes and hedge derivatives contracts.
(2)Debt financial instruments, Interbank loans and loans and accounts receivable from customer are presented on a gross basis, the related allowance are Ch$1,729, Ch$2 and Ch$1,149,989 million, respectively.
(3)Includes Subordinated bonds for MCh$1,813,938 which is presented as Regulatory capital financial instruments.

 

F-99

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 23 - MATURITY OF FINANCIAL ASSETS AND LIABILITIES

 

As of December 31, 2022  On Demand  

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 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Financial assets                                
Cash and deposits in banks   1,982,942    
-
    
-
    
-
    
-
    
-
    
-
    1,982,942 
Cash items in process of collection   843,816    
-
    
-
    
-
    
-
    
-
    
-
    843,816 
Financial assets for trading at FVTPL                                        
Financial derivative contracts and hedge contracts (1)   
-
    734,755    570,803    1,499,473    3,396,062    2,026,248    3,923,381    12,150,722 
Debt financial instruments   
-
    1    114,165    70    3,880    23,277    12,653    154,046 
Financial assets at FVOCI                                        
Debt financial instrument   
-
    2,617,251    744,182    68,973    2,167    559,210    1,888,950    5,880,733 
Other financial instruments   
-
    
-
    
-
    
-
    70,668    66,478    5,160    142,306 
Financial assets at amortised cost (2)                                        
Debt financial instruments   
-
    
-
    96,326    
-
    2,545,919    2,225,346    
-
    4,867,591 
Interbank loans   
-
    32,991    
-
    
-
    
-
    
-
    
-
    32,991 
Loans and account receivable from customers   713,513    3,402,788    2,980,575    5,158,378    7,943,135    4,431,396    14,066,625    38,696,410 
Guarantee deposits (margin accounts)   2,442,325    
-
    
-
    
-
    
-
    
-
    
-
    2,442,325 
Total financial assets   5,982,596    6,787,786    4,506,051    6,726,894    13,961,831    9,331,955    19,896,769    67,193,882 
                                         
Financial liabilities                                        
Cash items in process of being cleared   746,872    
-
    
-
    
-
    
-
    
-
    
-
    746,872 
Financial liabilities for trading at FVTPL                                        
Financial derivative contracts and hedge contracts (1)   
-
    67,236    151,948    2,541,236    4,686,662    2,415,134    4,245,898    14,108,114 
Financial liabilities at amortised cost                                        
Deposits and other demand liabilities   14,086,226    
-
    
-
    
-
    
-
    
-
    
-
    14,086,226 
Time deposits and other time liabilities   234,170    12,712,880    5,806    
-
    25,934    
-
    
-
    12,978,790 
Obligations under repurchase agreements   
-
    211,730    103,516    109    
-
    
-
    
-
    315,355 
Interbank borrowings   24,667    149,482    818,030    2,252,305    5,620,281    
-
    
-
    8,864,765 
Issued debt instruments (3)   
-
    -296,206    204,084    584,517    2,809,573    1,915,970    3,681,824    8,899,762 
Other financial liabilities   
-
    292,756    
-
    
-
    142    97    
-
    292,995 
Lease liabilities   
-
    
-
    
-
    25,902    46,955    32,784    31,448    137,089 
Guarantees received (margin accounts)   1,017,968    
-
    
-
    
-
    
-
    
-
    
-
    1,017,968 
Total financial liabilities   16,109,903    13,137,878    1,283,384    5,404,069    13,189,547    4,363,985    7,959,170    61,447,936 

 

(1)Includes derivative contracts for trading purposes and hedge derivatives contracts.
(2)Debt financial instruments, Interbank loans and loans and accounts receivable from customer are presented on a gross basis, the related allowance are Ch$894, Ch$1 and Ch$1,153,266 million, respectively.
(3)Includes Subordinated bonds for MCh$1,733,869 which is presented as Regulatory capital financial instruments.

 

F-100

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 24 - CONTINGENCIES AND COMMITMENTS

 

a.Lawsuits and legal procedures

 

As of the issuance date of these financial statements, the Bank and its affiliates were subject to certain legal actions in the normal course of their business. As of December 31, 2023, the Bank and its subsidiaries have provisions for this item of Ch$4,504 million (Ch$5,533 million as of December 31, 2022) which is included in “Provisions” in the Consolidated Statements of Financial Position as provisions for contingencies.

 

b.Contingent loans

 

The following table shows the Bank’s contractual obligations to issue loans:

 

   As of December 31,
   2023  2022
   MCh$  MCh$
Personal guarantees   494,104    924,173 
Personal guarantees in local currency   193,144    483,807 
Personal guarantees in foreign currency   300,960    440,366 
Letter of credits of merchandise traffic operations   262,496    255,522 
Transactions related to contingent events   1,641,510    1,476,599 
Transactions related to contingent events in local currency   1,179,242    1,216,117 
Transactions related to contingent events in foreign currency   462,268    260,482 
Unrestricted prompt cancel credit lines   9,490,141    8,974,077 
Other credit commitments   314,318    314,962 
Credit for university studies   813    1,617 
Other irrevocable credit commitments   313,505    313,345 
Total   12,202,569    11,945,333 

 

c.Held securities

 

The Bank holds securities in the normal course of its business as follows:

 

   As of December 31,
   2023  2022
   MCh$  MCh$
Third party operations      
Collections   80,597    104,972 
Transferred financial assets managed by the Bank   8,183    9,090 
Assets from third parties managed by the Bank and its affiliates   1,325,795    1,081,895 
Subtotal   1,414,575    1,195,957 
Custody of securities          
           
Securities held in custody   8,762,559    9,057,428 
Securities held in custody deposited in other entity   742,078    756,880 
 Issued securities held in custody   18,151,391    12,397,099 
Subtotal   27,656,028    22,211,407 
Total   29,070,603    23,407,364 

 

As of December 31, 2023, the Bank has classified the portfolios managed by private banking into “Assets from third parties managed by the Bank and its affiliates” (memo account), the balance is Ch$1,325,795 million (Ch$1,081,895 million as of December 31, 2022).

 

d.Guarantees

 

Banco Santander-Chile has an integral bank policy of coverage of Official Loyalty N°0030129 in force with the company Zurich Chile Seguros Generales S.A., coverage for USD50,000,000 per claim with an annual limit of USD100,000,000, which covers both the Bank and its subsidiaries, with an expiration date of June 30, 2024.

 

e.Contingent loans and liabilities

 

The Bank took on several contingent loans and liabilities, to satisfy its clients’ needs, that are not recognised in the Consolidated Financial Statements of Financial Position; these contain loan risks and are, therefore, part of the Bank’s global risk.

 

F-101

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 25 - INTEREST AND INFLATION INCOME

 

This item refers to interest earned in the period from the financial assets whose return, whether implicitly or explicitly, is determined by applying the effective interest rate method, regardless of the value at fair value, as well as the effect of hedge accounting.

 

a.For the years ended December 31, 2023, 2022 and 2021 the income from interest, was attributable to the following items:

 

   For the years ended December 31,
   2023  2022  2021
   Interest 

Inflation

adjustments

  Total  Interest 

Inflation

adjustments

  Total  Interest 

Inflation

adjustments

  Total
Items  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Financial assets at amortised cost                           
Resale agreements   70    
-
    70    1,063    
-
    1,063    190    
-
    190 
Debt financial instruments   120,363    78,200    198,563    62,876    195,082    257,958    15,078    103,164    118,242 
Interbank loans   579    -    579    925    
 
    925    429    
-
    429 
Commercial loans   1,287,677    291,578    1,579,255    954,978    825,146    1,780,124    662,170    404,803    1,066,973 
Mortgage loans   527,305    759,963    1,287,268    412,741    1,818,172    2,230,913    337,669    838,851    1,176,520 
Consumer loans   786,879    240    787,119    629,770    1,090    630,860    475,133    559    475,692 
Other interest income   182,025    4,739    186,764    78,192    8,242    86,434    5,808    8,629    14,437 
Subtotal   2,904,898    1,134,720    4,039,618    2,140,545    2,847,732    4,988,277    1,496,477    1,356,006    2,852,483 
Financial asset at fair value through other comprehensive income                                             
Debt financial instruments   413,690    14,851    428,541    270,026    43,104    313,130    87,311    7,346    94,657 
Other financial instruments   7,200    542    7,742    1,705    1,643    3,348    3,056    1,160    4,216 
Subtotal   420,890    15,393    436,193    271,731    44,747    316,478    90,367    8,506    98,873 
Hedging accounting   546,785    (618,695)   (71,910)   437,899    (1,655,998)   (1,218,099)   30,953    (77,789)   (46,836)
TOTAL   3,872,573    531,418    4,403,911    2,850,175    1,236,481    4,086,656    1,617,797    1,286,723    2,904,520 

 

b.For the years ended December 31, 2023, 2022 and 2021, the Bank’s expenses classified as interest expense are as follows:

 

   For the years ended December 31,
   2023  2022  2021
   Interest 

Inflation

adjustments

  Total  Interest 

Inflation

adjustments

  Total  Interest 

Inflation

adjustments

  Total
Items  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Financial liabilities at amortised cost                           
Demand deposits   12,228    4,364    16,592    13,623    12,023    25,646    14,533    4,938    19,471 
Time deposits and liabilities   1,221,707    59,873    1,281,580    759,511    119,613    879,124    88,949    20,451    109,400 
Repurchase agreements   47,267    
-
    47,267    15,774    
-
    15,774    839    
-
    839 
Interbank loans   235,583    
-
    235,583    98,357    
-
    98,357    43,692    
-
    43,692 
Issued debt instruments   231,211    185,870    417,081    174,707    448,103    622,810    133,583    228,153    361,736 
Other financial liabilities   51,349    18,731    70,080    26,430    39,934    66,364    3,382    33,026    36,408 
Subtotal   1,799,345    268,838    2,068,183    1,088,402    619,673    1,708,075    284,978    286,568    571,546 
Lease contracts   3,601    
-
    3,601    2,862    
-
    2,862    2,283    
-
    2,283 
Regulatory capital financial instruments   64,937    70,550    135,487    66,728    172,949    239,677    54,311    74,325    128,636 
Others equity instruments   28,389    
-
    28,389    28,234    
-
    28,234    4,995    
-
    4,995 
Hedging accounting   1,262,206    (186,924)   1,075,282    1,089,816    (552,120)   537,696    (539,680)   941,966    402,286 
TOTAL   3,158,478    152,464    3,310,942    2,276,042    240,502    2,516,544    (193,113)   1,302,859    1,109,746 

 

F-102

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 26 - FEES AND COMMISSIONS

 

This item includes the amount of fees earned and paid during the year, except for those which are an integral part of the financial instrument’s effective interest rate:

 

   For the years ended December 31,
Fee and commission income  2023  2022  2021
   MCh$  MCh$  MCh$
Fees and commissions for prepayments   14,151    11,348    16,266 
Fees and commissions of loans with credit lines   2,900    233    311 
Fees and commissions for lines of credits and overdrafts   2,820    8,766    7,602 
Fees and commissions for guarantees and letters of credit   34,462    35,935    39,010 
Fees and commissions for card services   422,737    352,448    273,641 
Fees and commissions for management of accounts   59,538    52,226    39,581 
Fees and commissions for collections and payments   60,912    54,060    26,871 
Fees and commissions for intermediation and management of securities   9,487    10,019    10,750 
Insurance brokerage fees   61,511    52,568    43,898 
Fees and commissions for factoring operations services   1,249    1,829    1,223 
Fees and commissions for securitizations   
-
    45    29 
Fees and commissions for financial advice   15,422    9,362    14,332 
Office banking   21,495    21,771    17,823 
Fees for other services rendered   60,823    56,543    49,178 
Other fees earned   81,006    61,910    54,666 
Total   848,513    729,063    595,181 

 

   For the years ended December 31,
Fee and commission expense  2023  2022  2021
   MCh$  MCh$  MCh$
Compensation for card operation   127,284    105,695    76,418 
Commissions for licence for use brands   6,076    7,360    5,570 
Commissions for services linked to the credit card and prepaid cards   10,943    11,458    10,083 
Commissions for obligations of loyalty programmes and merits for card customers   95,542    95,946    81,734 
Fees and commissions for securities transactions   9,115    8,551    8,001 
Office banking   2,859    2,382    2,115 
Interbank services   61,136    47,428    34,143 
Other fees   32,916    42,974    27,789 
Total   345,873    321,794    245,853 
                
Net fees and commissions income   502,640    407,269    349,328 

 

F-103

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 26 - FEES AND COMMISSIONS, continued

 

The income and expenses for the commissions of the business segments and the calendar for the recognition of income from ordinary activities as of December 31, 2023 are presented below:

 

   Segments 

Revenue recognition calendar

for ordinary activities

As of December 31, 2023

  Individuals and PYMEs  Companies and Institutions  Global Investment Banking  Others 

 

Total

 

 

Transferred over time

 

Transferred at a point
in time

 

 

Accrual model

   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Commission income                        
Commissions for prepayments   11,723    2,052    123    253    14,151    
 -
    14,151    
-
 
Commissions of loans with credit lines   2,887    10    
-
    3    2,900    
-
    2,900    
-
 
Commissions for lines of credits and overdrafts   1,742    (568)   1,667    (21)   2,820    2,820    
-
    
-
 
Commissions for guarantees and letters of credit   4,072    18,460    11,014    916    34,462    34,462    
-
    
-
 
Commissions for card services   360,758    34,347    27,394    238    422,737    84,547    338,190    
-
 
Commissions for management of accounts   55,495    3,232    804    7    59,538    59,538    
-
    
-
 
Commissions for collections and payments   84,434    9,846    8,115    (41,483)   60,912    
-
    36,547    24,365 
Commissions for intermediation and management of securities   1,926    598    6,830    133    9,487    
-
    9,487    
-
 
Remuneration for insurance brokerage fees   60,625    56    1    829    61,511    
-
    61,511    
-
 
Commissions for factoring operations services   126    565    549    9    1,249    
-
    1,249    
-
 
Commissions for securitizations   
-
    
-
    
-
    
-
    
-
    
-
    
-
    
-
 
Commissions for financial advice   45    5,250    3,980    6,147    15,422    
-
    15,422    
-
 
Office banking   14,190    5,966    1,339    
-
    21,495    21,495    
-
    
-
 
Fees for other services rendered   54,494    5,283    1,044    2    60,823    
-
    60,823    
-
 
Other fees earned   66,003    9,992    6,278    (1,267)   81,006    
-
    81,006    
-
 
Total   718,520    95,089    69,138    (34,234)   848,513    202,862    621,286    24,365 
                                         
Commission expenses                                        
Compensation for card operation   (106,507)   (16,859)   (3,620)   (299)   (127,285)   
-
    (127,285)   
-
 
Commissions for licence for use brands   (5,078)   (943)   (38)   (18)   (6,077)   
-
    (6,077)   
-
 
Commissions for services linked to the credit card and prepaid cards   (16,188)   (584)   (62)   5,891    (10,943)   
-
    (10,943)   
-
 
Commissions for obligations of loyalty programmes and merits for card customers   (94,316)   (990)   
-
    (236)   (95,542)   
-
    (57,325)   (38,217)
Fees and commissions for securities transactions   
-
    
-
    (7,426)   (1,689)   (9,115)   
-
    (9,115)   
-
 
Office banking   (2,286)   (811)   (244)   482    (2,859)   (2,859)   
-
    
-
 
Interbank services   (48,872)   (7,370)   (5,215)   321    (61,136)   
-
    (61,136)   
-
 
Other fees   (68,630)   (2,568)   (2,076)   40,358    (32,916)   
-
    (32,916)   
-
 
Total   (341,877)   (30,125)   (18,681)   44,810    (345,873)   (2,859)   (304,797)   (38,217)
Total Net commission income and expenses   376,643    64,964    50,457    10,576    502,640    200,003    316,489    (13,852)

 

F-104

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 26 - FEES AND COMMISSIONS, continued

 

The income and expenses for the commissions of the business segments and the calendar for the recognition of income from ordinary activities as of December 31, 2022 are presented below:

 

   Segments 

Revenue recognition calendar

for ordinary activities

As of December 31, 2022

  Individuals and PYMEs  Companies and Institutions  Global Investment Banking  Others 

 

Total

 

 

Transferred over time

 

Transferred at a point in time

 

 

Accrual model

   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Commission income                        
Commissions for prepayments   7,072    3,229    11    1,036    11,348    
-
    11,348    
-
 
Commissions of loans with credit lines   170    
-
    
-
    63    233    
-
    233    
-
 
Commissions for lines of credits and overdrafts   7,039    (836)   2,556    7    8,766    8,766    
-
    
-
 
Commissions for guarantees and letters of credit   5,028    20,295    10,036    576    35,935    35,935    
-
    
-
 
Commissions for card services   301,123    24,915    9,417    16,993    352,448    71,904    280,544    
-
 
Commissions for management of accounts   48,336    3,011    845    34    52,226    46,054    6,172    
-
 
Commissions for collections and payments   65,897    9,318    8,052    (29,207)   54,060    
 
    38,065    15,995 
Commissions for intermediation and management of securities   2,249    276    6,874    620    10,019    
-
    10,019    
-
 
Commissions for factoring operations services   52,757    12    1    (202)   52,568    
-
    
-
    52,568 
Commissions for securitizations   313    657    761    98    1,829    
-
    1,829    
-
 
Commissions for financial advice   
-
    
-
    45    
-
    45    
-
    45    
-
 
Remuneration for insurance commercialization   (1,362)   2,894    3,916    3,914    9,362    
-
    9,362    
-
 
Office banking   15,260    5,489    1,022    0    21,771    21,771    
-
    
-
 
Fees for other services rendered   52,059    3,801    668    15    56,543    
-
    56,543    
-
 
Other fees earned   47,603    9,790    6,905    (2,388)   61,910    
-
    61,910    
-
 
Total   603,544    82,851    51,109    (8,441)   729,063    184,430    476,070    68,563 
                                         
Commission expenses                                        
Compensation for card operation   94,473    9,619    1,418    185    105,695    12,505    93,190    
-
 
Commissions for licence for use brands   6,679    620    51    10    7,360    5,500    1,860    
-
 
Commissions for services linked to the credit card and prepaid cards   11,029    391    38    0    11,458    11,458    
-
    
-
 
Commissions for obligations of loyalty programmes and merits for card customers   94,958    987    1    0    95,946    85,412    10,534    
 
 
Fees and commissions for securities transactions   0    0    6,186    2,365    8,551    
 
    8,551    
-
 
Office banking   4,772    (82)   (2,308)   0    2,382    2,382    
-
    
-
 
Interbank services   33,658    6,026    7,804    (60)   47,428    
-
    47,428    
-
 
Other fees   45,269    2,646    619    (5,560)   42,974    
-
    42,974    
-
 
Total   290,838    20,207    13,809    (3,060)   321,794    117,257    204,537    0 
Total Net commission income and expenses   312,706    62,644    37,300    (5,381)   407,269    67,173    271,533    68,563 

 

F-105

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 26 - FEES AND COMMISSIONS, continued

 

The income and expenses for the commissions of the business segments and the calendar for the recognition of income from ordinary activities as of December 31, 2021 are presented below:

 

   Segments 

Revenue recognition calendar

for ordinary activities

As of December 31, 2021  Individuals and PYMEs  Companies and Institutions  Global Investment Banking  Others 

 

Total

 

 

Transferred over time

 

Transferred at a point in time

 

 

Accrual model

   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Commission income                        
Commissions for prepayments   8,360    7,572    1,525    (1,191)   16,266    
-
    16,266    
-
 
Commissions of loans with credit lines   323    1    
-
    (13)   311    
-
    311    
-
 
Commissions for lines of credits and overdrafts   6,284    835    430    53    7,602    7,602    
-
    
-
 
Commissions for guarantees and letters of credit   11,620    19,281    7,983    126    39,010    39,010    
-
    
-
 
Commissions for card services   258,971    11,223    3,401    46    273,641    58,186    215,455    
-
 
Commissions for management of accounts   35,933    2,496    1,149    3    39,581    39,581    
-
    
-
 
Commissions for collections and payments   24,615    1,561    653    42    26,871    
-
    12,498    14,373 
Commissions for intermediation and management of securities   3,687    355    5,790    918    10,750    
-
    10,750    
-
 
Commissions for factoring operations services   43,995    
-
    3    (100)   43,898    
-
    
-
    43,898 
Commissions for securitizations   359    418    444    2    1,223    
-
    1,223    
-
 
Commissions for financial advice   
-
    
-
    29    
-
    29    
-
    29    
-
 
Remuneration for insurance commercialization   1    2,297    12,097    (63)   14,332    
-
    14,332    
-
 
Office banking   12,493    4,494    836    
 
    17,823    17,823    
-
    
-
 
Fees for other services rendered   45,278    3,306    581    13    49,178    
-
    49,178    
-
 
Other fees earned   38,017    6,788    2,311    7,550    54,666    
-
    54,666    
-
 
Total   489,936    60,627    37,232    7,386    595,181    162,202    374,708    58,271 
                                         
Commission expenses                                        
Compensation for card operation   69,756    5,119    1,034    509    76,418    9,041    67,377    
-
 
Commissions for licence for use brands   5,370    215    (15)   
-
    5,570    4,162    1,408    
-
 
Commissions for services linked to the credit card and prepaid cards   9,987    80    16    
-
    10,083    10,083    
-
    
-
 
Commissions for obligations of loyalty programmes and merits for card customers   81,610    621    3    (500)   81,734    72,760    8,974    
-
 
Fees and commissions for securities transactions   
-
    
-
    4,688    3,313    8,001    
-
    8,001    
-
 
Office banking   4,237    (73)   (2,049)        2,115    2,115         
-
 
Interbank services   24,230    4,338    5,618    (43)   34,143    
-
    34,143    
-
 
Other fees   41,588    2,568    4,472    (20,839)   27,789    
-
    27,789    
-
 
Total   236,778    12,868    13,767    (17,560)   245,853    98,161    147,692    
-
 
Total Net commission income and expenses   253,158    47,759    23,465    24,946    349,328    64,041    227,016    58,271 

 

F-106

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 27 - NET INCOME (EXPENSE) FROM FINANCIAL OPERATIONS

 

The detail of income (expense) from financial operations is as follows:

 

   For the years ended December 31,
   2023  2022  2021
   MCh$  MCh$  MCh$
Net income/(expense) from financial assets for trading at FVTPL         
Financial derivative contracts   103,335    70,001    (25,405)
Debt financial instruments   (11,662)   8,139    (4,841)
Other financial instrumets   88    51    24 
Subtotal   91,761    78,191    (30,222)
Net income from financial liabilities for trading at FVTPL               
Financial derivative contracts   
-
    
-
    1,620 
Subtotal   
-
    
-
    1,620 
Net income from non-current assets and groups available for sale not admissible as discontinued operations               
Financial assets at amortised cost   (215)   2,088    2,745 
Financial assets at fair value through OCI   (125,610)   (20,173)   23,188 
Financial liabilities at amortised cost   4,891    16,457    (3,734)
Subtotal   (120,934)   (1,628)   22,199 
Net income from exchange, adjustment and hedge accounting of foreign currency               
Net income from foreign currency exchange   (83,695)   260,428    (481,340)
Net income from readjustment of foreign currency               
Financial assets at FVTPL   6,952    
-
    
-
 
Financial assets at amortised cost   2,350    1,856    18,954 
Others assets   (14)   1,353    (159)
Financial liabilities at FVTPL   547    (760)   
-
 
Net income from hege accounting of foreign currency risk   405,488    (122,262)   587,976 
Subtotal   331,628    140,615    125,431 
                
Total income (expense) from financial operations   302,455    217,178    119,028 

 

F-107

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 28 - NET INCOME FROM NON-CURRENT ASSETS AND GROUPS AVAILABLE FOR SALE NOT ADMISSIBLE AS DISCONTINUED OPERATIONS

 

The detail of net income from assets received in lieu of payment and sale of non-currents assets is as follows:

 

   For the years ended December 31,
   2023  2022  2021
   MCh$  MCh$  MCh$
Net income from assets received in lieu of payment         
Income from assets received in lieu of payment   8,452    4,873    2,786 
Other income from assets received in lieu of payment   
-
    
-
    455 
Provision on assets received in lieu of payment   858    (743)   (192)
Expenses for maintenance of assets received in lieu of payment   (1,437)   (2,017)   (1,425)
Subtotal   7,873    2,113    1,624 
Sale of non-current assets               
Net income from sale of fixed assets   5,281    6,405    673 
Subtotal   5,281    6,405    673 
                
TOTAL   13,154    8,518    2,297 

 

F-108

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 29 - OTHER OPERATING INCOME AND EXPENSES

 

Other operating income is comprised of the following components:

 

   For the years ended December 31,
   2023  2022  2021
   MCh$  MCh$  MCh$
Pension plan interest   539    963    640 
Compensation from insurance companies due to damages (1)   45    141    45 
Rental income   457    488    286 
Income from recovery tax and expenses   661    548    218 
Income from business alliance   1,218    1,180    440 
Other   887    2,219    33 
Total   3,807    5,539    1,662 

 

(1)Mainly related to recoveries from fraud claims.

 

Other operating expenses are detailed as follows:

 

   For the years ended December 31,
   2023  2022  2021
   MCh$  MCh$  MCh$
Credit card expenses   1.043    779    272 
Customer services   1,791    2,583    2,305 
Operating risk charge-offs and provision   10,769    11,089    11,287 
Recovery of operating expenses   (2,692)   (362)   (2,389)
Life insurance and general product insurance policies (1)   9,325    47,214    45,949 
Commercial representation expenses   2,053    2,373    8,720 
Expenses associated leasing operations (2)   5,329    3,842    3,772 
Expenses associated factoring operations   769    784    414 
Commercial alliance expenses   696    682    878 
Lawsuits provision   (1,081)   1,210    493 
Donations   
-
    
-
    119 
Retail association payment   162    243    274 
Bond issuance expenses   1,157    1,202    217 
Other   2,317    34,667    29,119 
Total   31,638    106,306    101,430 

 

(1)New Fraud Law became effective on 2020, under which the Bank assumes responsibility against card fraud and electronic transactions.
(2)Includes leasing land taxes, which were modified in 2020 (Tax Modernization Law).

 

F-109

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 30 - PERSONNEL SALARIES AND EXPENSES

 

For the years ended December 31, 2023, 2022 and 2021, the composition of personnel salaries and expenses is as follows:

 

   For the years ended December 31,
   2023  2022  2021
   MCh$  MCh$  MCh$
          
Salary compensation   217,908    216,124    205,443 
Performance bonus   47,071    60,801    65,873 
Legal compensation   50,677    49,463    47,028 
Short-term bonuses   34,186    33,462    38,879 
Long-term bonus   14,629    14,659    4,132 
Stock-based benefits   2,119    (1,169)   (315)
Seniority compensation   36,289    27,289    25,878 
Pension plans   (1,251)   849    (873)
Training expenses   2,653    2,487    2,659 
Nursery school and kindergarten expenses   2,749    2,928    2,812 
Other personnel expenses   5,245    7,915    6,159 
Total   412,275    414,808    397,675 

 

F-110

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 31 - ADMINISTRATIVE EXPENSES

 

For the years ended December 31, 2023, 2023 and 2022, the composition of the item is as follows:

 

   For the years ended December 31,
   2023  2022  2021
   MCh$  MCh$  MCh$
General administrative expenses         
Maintenance and repair of property, plant and equipment   23,720    23,411    22,157 
Short term leases contracts   9,712    5,503    3,844 
Other expenses related to leases contracts   87    30    20 
Insurance payments   4,839    5,656    5,133 
Office supplies   5,426    6,588    4,285 
IT and communication expenses   83,898    85,209    80,965 
Heating, and other utilities   5,388    5,514    4,213 
Security and valuables transport services   19,893    16,459    13,490 
Representation and personnel travel expenses   3,140    2,314    2,723 
Judicial and notarial expenses   1,282    911    915 
Fees for technical reports, assessments and auditing   6,450    8,760    7,950 
Fines applied by FMC and other agencies   29    51    
-
 
Other general administrative expenses   20,708    20,631    14,337 
Subtotal   184,572    181,037    160,032 
Outsourced services               
Data processing   44,677    41,714    36,250 
Technological development, certification and testing service   3,629    3,197    3,442 
Administration and supply of external human resources   36    21    105 
Call center for sale, marketing and control quality of client’ services   7    15    8 
External collection services   308    427    241 
External ATM administration and  maintenance services   504    525    377 
External cleaning, casino, custody, storage services   3,837    4,691    4,395 
Product sale and distribution services   
-
    119    368 
External credit evaluation services   5,347    5,195    7,243 
Other   30,532    26,042    21,887 
Subtotal   88,877    81,946    74,316 
Board expenses   1,711    1,764    1,539 
Marketing expenses   23,555    25,984    26,321 
Taxes, payroll taxes, and contributions               
Real estate taxes   2,185    2,107    1,893 
Patents   2,698    2,134    2,289 
Other taxes   5    2    5 
Contributions to FMC   16,508    15,245    13,739 
Subtotal   21,396    19,488    17,926 
Total   320,111    310,219    280,134 

 

F-111

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 32 - DEPRECIATION, AMORTISATION, AND IMPAIRMENT

 

Depreciation, amortisation and impairment charges for the years ended December 31, 2023, 2022 and 2021, are detailed below:

 

   For the years ended December 31,
   2023  2022  2021
   MCh$  MCh$  MCh$
Depreciation and amortisation         
Depreciation of property, plant, and equipment   59,055    56,297    60,904 
Amortisation of Intangible assets   53,393    42,377    32,252 
Depreciation right of use assets   31,314    31,319    28,899 
Total depreciation and amortisation   143,762    129,993    122,055 
Impairment of property, plant, and equipment   
-
    
-
    
-
 
Impairment of right of use assets   
-
    
-
    
-
 
Impairment of intangibles   1,912    
-
    
-
 
Total impairment   1,912    
-
    
-
 
Total   145,674    129,993    122,055 

 

F-112

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 33 - EXPECTED CREDIT LOSSES ALLOWANCE

 

As of December 31, 2023, 2022 and 2021, under the credit risk model established by IFRS 9 the ECL allowance by stage recorded at income statements is as follows:

 

For the year ended December 31, 2023 *  Stage 1   Stage 2   Stage 3    
   Corporate   Other **
commercial
   Corporate  

Other **

commercial

   Corporate   Other **
commercial
   TOTAL 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Commercial loans   132    (3,898)   (19,358)   4,686    92,539    81,616    155,717 
Mortgage loans   
-
    (4,582)   
-
    (1,213)   
-
    97,364    91,569 
Consumer loans   
-
    29,029    
-
    57,262    
-
    119,881    206,172 
Contingent loans   (1,184)   (14,256)   (6,316)   (1,834)   816    (1,589)   (24,363)
Loans and account receivable at FVOCI   (201)   
-
    
-
    
-
    
-
    
-
    (201)
Debt at FVOCI   
-
    (78)   
-
    
-
    
-
    
-
    (78)
Debt at amortised cost   
-
    1,038    
-
    
-
    
-
    
-
    1,038 
Subtotal   (1,253)   7,253    (25,674)   58,901    93,355    297,272    429,854 
Recovery of loans previously charged-off    (107,069)
TOTAL    322,785 

 

*Includes overlays for an amount of MCh$93,614 to cover certain defaulted loans from mortgage and other commercial portfolios. See Note 37, Risk management.
**Includes Other Commercial, Mortgages and Consumer.

 

For the year ended December 31, 2022 *  Stage 1   Stage 2   Stage 3     
   Corporate   Other **
commercial
   Corporate   Other **
commercial
   Corporate   Other **
commercial
   TOTAL 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Commercial loans   
4,3245
    8,734    272    515    90,349    93,961    198,156 
Mortgage loans   
-
    (5,010)   
-
    (4,936)   
-
    51,327    41,381 
Consumer loans   
-
    16,234    
-
    72,115    
-
    113,510    201,859 
Contingent loans   453    2,864    (837)   (231)   1,511    1,429    5,189 
Loans and account receivable at FVOCI   58    
-
    
-
    
-
    
-
    
-
    58 
Debt at FVOCI   
-
    (529)   
-
    
-
    
-
    
-
    (529)
Debt at amortised cost   
-
    957    
-
    
-
    
-
    
-
    957 
Subtotal   4,836    23,250    -565    67,463    91,860    260,227    447,071 
Recovery of loans previously charged-off    (90,577)
TOTAL    356,494 

 

*Includes overlays for an amount of MCh$91,351 for future macro-economic information and scenarios updates. See Note 37, Risk management.

**Includes Other Commercial, Mortgages and Consumer

 

For the year ended December 31, 2021  Stage 1   Stage 2   Stage 3     
   Corporate   Others **
commercial
   Corporate   Others
commercial
   Corporate   Others**
commercial
   TOTAL 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Commercial loans   22,469    6,625    37,952    3,445    48,013    58,030    176,534 
Mortgage loans   
-
    7,134    
-
    7,540    
-
    29,763    44,437 
Consumer loans   
-
    56,994    
-
    17,710    
-
    59,963    134,667 
Contingent loans   1,607    7,397    5,167    (1,420)   (279)   (218)   12,254 
Loans and account receivable at FVOCI   59    
-
    
-
    
-
    
-
    
-
    59 
Debt at FVOCI   
-
    (435)   
-
    
-
    
-
    
-
    (435)
Debt at amortised cost   
-
    711    
-
    
-
    
-
    
-
    711 
Total   24,135    78,426    43,119    27,275    47,734    147,538    368,227 
Recovery of loans previously charged-off    (76,999)
TOTAL    291,228 

 

**Includes Other Commercial, Mortgages and Consumer.

 

F-113

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 34 - TRANSACTIONS WITH RELATED PARTIES

 

In addition to affiliates and associated entities, the Bank’s “related parties” include its “key personnel” from the executive staff (members of the Bank’s Board of Directors and Managers of Banco Santander-Chile and its affiliates, together with their close relatives), as well as the entities over which the key personnel could exercise significant influence or control.

 

The Bank also considers the companies that are part of the Santander Group worldwide as related parties, since all of them have a common parent, i.e., Banco Santander S.A. (located in Spain).

 

Transactions between the Bank and its related parties are specified below, facilitate comprehension purposes, we have divided the information into four categories:

 

Santander Group Companies

 

This category includes all the companies that are controlled by the Santander Group around the world, and hence, it also includes the companies over which the Bank exercises any degree of control (affiliates and special-purpose entities).

 

Associated companies

 

This category includes the entities over which the Bank, in accordance with section b) of Note 1 to these Financial Statements, exercises a significant degree of influence and which generally belong to the group of entities known as “business support companies”.

 

Key personnel

 

This category includes members of the Bank’s Board of Directors and managers of Banco Santander-Chile and its affiliates, together with their close relatives.

 

Other

 

This category encompasses the related parties that are not included in the groups identified above and which are, in general, entities over which the key personnel could exercise significant influence or control.

 

The terms for transactions with related parties are equivalent to those which prevail in transactions made under market conditions or to which the corresponding considerations in kind have been attributed.

 

F-114

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

NOTE 34 - TRANSACTIONS WITH RELATED PARTIES, continued

 

a.Loans to related parties

 

Loans and accounts receivable as well as contingent loans that correspond to related entities are as follows:

 

   As of December 31, 
   2023   2022   2021 
   Group
entities
   Associates
entities
   Key
personnel
   Other   Group
entities
   Associates
entities
   Key
personnel
   Other   Group
entities
   Associates
entities
   Key
personnel
   Other 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
                                                 
Loans and accounts receivable                                                
Commercial loans   750,419    49,284    3,272    978    680,624    118    3,185    280    592,992    192    2,611    219 
Mortgage loans   -    -    29,809    -    -    -    30,479    -    -    -    20,716    - 
Consumer loans   -    -    6,388    -    -    -    6,540    -    -    -    6,562    - 
Loans and accounts receivable   750,419    49,284    39,469    978    680,624    118    40,204    280    592,992    192    29,889    219 
                                                             
Allowance for loan losses   (1,037)   (50)   (361)   (19)   (2,213)   (8)   (164)   (10)   (2,586)   (30)   (138)   (6)
Net loans   749,382    49,234    39,108    959    678,411    100    40,040    270    590,406    162    29,751    213 
                                                             
Guarantees                       -    -    -    -    2,039    -    25,545    117 
                                                             
Contingent loans                                                            
Personal guarantees   -    -    -    -    -    -    -    -    -    -    -    - 
Letters of credit   1,960    -    -    -    19,162    -    -    -    13,848    -    -    - 
Guarantees   438    -    -    343    30,422    -    -    -    538    -    -    - 
Contingent loans   2,398    -    -    343    49,584    -    -    -    14,386    -    -    - 
                                                             
Allowance for contingent loans   (4)   -    -    (5)   (41)   -    -    -    (32)   -    -    - 
Net contingent loans   2,394    -    -    338    49,543    -    -    -    14,354    -    -    - 

  

F-115

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 34 - TRANSACTIONS WITH RELATED PARTIES, continued

 

Loan activity to related parties during 2023, 2022 and 2021 is shown below:

 

   As of December 31, 
   2023   2022   2021 
   Group
entities
   Associates
entities
   Key
Personnel
   Other   Group
entities (*)
   Associates
entities
   Key
Personnel
   Other   Group
entities (*)
   Associates
entities
   Key
Personnel
   Other 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Opening balances as of January 1,   730,208    118    40,204    280    607,378    192    29,889    219    356,848    265    32,498    993 
Loans granted   101,819    65,320    13,177    5,389    179,540    29    18,115    156    373,006    -    5,738    53 
Loans payments   (79,210)   (16,154)   (13,912)   (4,348)   (56,710)   (103)   (7,800)   (95)   (122,476)   (73)   (8,347)   (827)
Total   752,817    49,284    39,469    1,321    730,208    118    40,204    280    607,378    192    29,889    219 

  

(*)Loans with non-controlled companies (not-consolidated) amount MCh$3,348, MCh$27,544 and MCh$1,174 as of December 31, 2023, 2022 and 2021, respectively.

 

b.Assets and liabilities with related parties

 

   As of December 31, 
   2023   2022   2021 
   Group
entities
   Associates
entities
   Key
personnel
   Other   Group
entities
   Associates
entities
  

Key

personnel

   Other   Group
entities
   Associates
entities
  

Key

personnel

   Other 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Assets                                                
Cash and deposits in banks   666,062    -    -    -    280,364    -    -    -    1,069,468    -    -    - 
Financial assets at FVTPL                                                            
Financial derivative contracts   967,020    267,679    -    -    1,190,683    386,494    -    -    1,164,660    298,997    -    - 
Other assets   686,950    550,400    -    -    676,850    287,053    -    -    1,042,852    437,227    -    - 
                                                             
Liabilities                                                            
Financial liabilities at FVTPL                                                            
Financial derivative contracts   1,255,740    370,314    -    -    1,695,284    326,149    -    -    2,083,795    224,247    -    - 
Financial liabilities at amortised cost                                                            
Deposits and other demand liabilities   54,033    1,272    3,833    502    73,193    -    4,398    833    16,190    2,486    4,760    1,003 
Time deposits and other time liabilities   145,649    -    9,894    1,589    10,376    -    9,442    1,102    900,830    1,677    3,066    948 
Obligations under repurchase agreements   129,321    -    -    -    64,547    -    -    18,135    57,771    -    181    5,807 
Interbank borrowing   33,693    -    -    -    224,798    -    -    -    640,860    -    -    - 
Issued debt instruments   1,081,123    -    -    -    1,001,310    -    -    -    584,244    592,468    -    - 
Other financial liabilities   257,915    435,093    -    -    267,130    325,070    -    -    16,259    233,630    -    - 

 

F-116

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 34 - TRANSACTIONS WITH RELATED PARTIES, continued

 

c.Income (expense) recorded due to transactions with related parties

 

   For the years ended December 31, 
   2023   2022   2021 
   Group
entities
   Associates
entities
   Key
personnel
   Other   Group
entities
   Associates
entities
   Key
personnel
   Other   Group
entities
   Associates
entities
   Key
personnel
   Other 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
                                                 
Interest income and inflation-indexation adjustments   (45,542)   1,471    1,717    (41)   (44,196)   (13)   4,198    79    (24,428)   51    1,905    9 
Fee and commission income and expenses   176,603    87,987    250    24    157,236    86,581    261    15    134,404    25,445    202    11 
Net income (expense) from financial operations and net foreign exchange gain (loss) (*)   233,651    -    -    -    (690,780)   (47,993)   (217)   27    (751,605)   187,300    -    - 
Other operating income and expenses   964    (734)   -    -    1,311    (619)   -    -    552    (525)   -    - 
Key personnel compensation and expenses   -    -    (43,941)   -    -    -    (32,739)   -    -    -    (36,579)   - 
Administrative and other expenses   (95,561)   (1,120)   -    -    (78,435)   (82,771)   -    -    (66,895)   (54,953)   -    - 

 

(*)Primarily relates to derivative contracts used to financial hedge of exchange risk of assets and liabilities that cover positions of the Bank and its subsidiaries.

 

F-117

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 34 - TRANSACTIONS WITH RELATED PARTIES, continued

 

d.Transactions with related parties

 

Single transaction in the period with related parties not legal persons, which are not usual business operations of the Bank with their clients, and that exceed UF 2,000 (USD 83,178).

 

                
As of December 31, 2023        Description of the transactions  Effect on income statements  Effect on balance sheet
Business name  Country  Nature of
relationship
with the Bank
  Type of
service
  Term  Renewal  Income
MCh$
  Expenses
MCh$
  Account
receivable
MCh$
 

Account
payable
MCh$

Banco Santander, S.A.  Spain  Group  Advisory services  Monthly  Contractual   
-
    18,929    
-
    18,715 
Santander Back-Offices Globales Mayoristas, S.A.  Spain  Group  Servicios de BackOffice  Monthly  Contractual   
-
    3,216    
-
    
-
 
Santander Chile Holding S.A.  Chile  Group  Leases  Monthly  Contractual   255    
-
    2    
-
 
Santander Factoring S.A.  Chile  Group  Leases, Custody and gateway  Monthly  Contractual   42    418    20    51 
Gesban Santander Servicios Profesionales Contables Limitada  Chile  Group  Accounting services  Monthly  Contractual   60    1,104    
-
    
-
 
Santander Global Services, S.L.  Spain  Group  Advisory services  Monthly  Contractual   
-
    639    
-
    
-
 
Santander Investment Chile Limitada  Chile  Group  Leases  Monthly  Contractual   
-
    4,725    
-
    29 
Santander Global Technology and Operations Chile limitada  Chile  Group  IT Services  Monthly  Contractual   
-
    306    
-
    9 
Universia Chile S.A.  Chile  Group  Institucional services  Monthly  Contractual   4    377    
-
    
-
 
Aquanima Chile S.A.  Chile  Group  Procurement Services  Monthly  Contractual   
-
    1,943    
-
    112 
Santander Asset Management S.A. Administradora General de Fondos  Chile  Group  Leases and others  Monthly  Contractual   
-
    676    747    78 
Centro de Compensación Automatizado S.A.  Chile  Associated  Derivatives clearing  Monthly  Contractual   
-
    3,615    
-
    
-
 
Sociedad Operadora de la Cámara de Compensación de Pagos de Alto Valor S.A.  Chile  Associated  Card operator  Monthly  Contractual   
-
    646    
-
    
-
 
Zurich Santander Seguros Generales Chile S.A.  Chile  Associated  Sale channel service  Monthly  Contractual   205    
-
    1,667    
-
 
F1rst Tecnologia e Inovação Ltda.  Brazil  Group  IT Services and Service desk  Monthly  Contractual   
-
    8,723    
-
    
-
 
Santander Global Technology and Operations, S.L. Unipersonal  Spain  Group  IT Services and Operations  Monthly  Contractual   
-
    52,948    
-
    
-
 
PagoNxt Trade Services, S.L.  Spain  Group  Digital payments  Monthly  Contractual   
-
    400    
-
    
-
 
Mercury Trade Finance Solutions, S.p.A.  Chile  Group  IT Services  Monthly  Contractual   
-
    183    
-
    
-
 
PagoNxt Trade Chile SpA  Chile  Group  Data processing and transmission  Monthly  Contractual   31    1,680    31    1,680 
Banco Santander, S.A.  Spain  Group  Advisory services  Monthly  Contractual   
-
    18,929    
-
    18,715 

 

F-118

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 34 - TRANSACTIONS WITH RELATED PARTIES, continued

 

                
As of December 31, 2022        Description of the transactions  Effect on income statements  Effect on balance sheet
Business name  Country  Nature of
relationship
with the Bank
  Type of
service
  Term  Renewal  Income
MCh$
  Expenses
MCh$
  Account
receivable
MCh$
 

Account payable
MCh$

Banco Santander, S.A.  Spain  Group  Advisory services  Monthly  Contractual   
-
    15,999    
-
    1,642 
Santander Back-Offices Globales Mayoristas, S.A.  Spain  Group  BackOffice services  Monthly  Contractual   
-
    3,059    
-
    
-
 
Santander Chile Holding S.A.  Chile  Group  Leases  Monthly  Contractual   234    
-
    234    
-
 
Santander Factoring S.A.  Chile  Group  Leases, Custody and gateway  Monthly  Contractual   39    423    39    133 
Gesban Santander Servicios Profesionales Contables Limitada  Chile  Group  Accounting services  Monthly  Contractual   60    1,019    60    523 
Santander Gestión de Recaudación y Cobranzas, Ltda.  Chile  Group  Leases and collection  Monthly  Contractual   408    180    408    14 
Santander Global Facilities, S.L.  Spain  Group  Advisory services  Monthly  Contractual   
-
    341    
-
    
-
 
Santander Investment Chile Limitada  Chile  Group  Leases  Monthly  Contractual   
-
    4,381    
-
    26 
Santander Corredores de Bolsa Limitada  Chile  Group  Leases  Monthly  Contractual   65    226    65    29 
Santander Global Technology and Operations Chile limitada  Chile  Group  IT Services  Monthly  Contractual   
-
    258    
-
    
-
 
Universia Chile, S.A.  Chile  Group  Institucional services  Monthly  Contractual   8    341    8    
-
 
Aquanima Chile S.A.  Chile  Group  Procurement Services  Monthly  Contractual   
-
    1,710    
-
    
-
 
Santander Asset Management S.A. Administradora General de Fondos  Chile  Group  Leases and others  Monthly  Contractual   
-
    626    
-
    78 
Zurich Santander Seguros Generales Chile S.A.  Chile  Group  Commercial agreements  Monthly  Contractual   187    
-
    187    
-
 
Santander Consumer Finance Limitada  Chile  Group  Advisory services and others  Monthly  Contractual   70    
-
    70    
-
 
Santander Global Technology and Operations, S.L. Unipersonal  Spain  Group  IT Services  Monthly  Contractual   
-
    49,744    
-
    
-
 
Mercury Trade Finance Solutions, S.p.A.  Chile  Group  IT Services  Monthly  Contractual   
-
    256    
-
    
-
 
Sociedad Operadora de Tarjetas de Pago Santander Getnet Chile S.A.  Chile  Group  Leases  Monthly  Contractual   415    
-
    415    
-
 
Santander Corredora de Seguros Limitada  Chile  Group  Insurance broker  Monthly  Contractual   87    
-
    87    
-
 
Centro de Compensación Automatizado, S.A.  Chile  Group  Derivatives clearing  Monthly  Contractual   
-
    2,184    
-
    
-
 
Sociedad Operadora de la Cámara de Compensación de Pagos de Alto Valor S.A.  Chile  Group  Card operator  Monthly  Contractual   
-
    632    
-
    
-
 
PagoNxt Trade Services, S.L.  Spain  Group  Digital payments  Monthly  Contractual   
-
    284    
-
    
-
 

 

F-119

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 34 - TRANSACTIONS WITH RELATED PARTIES, continued

 

e.Payments to Board members and key management personnel

 

The compensation received by key management personnel, including Board members and all the executives holding manager positions shown in the “Personnel salaries and expenses” and/or “Administrative expenses” items of the Consolidated Statements of Income, corresponds to the following categories:

 

   For the years ended December 31,
   2023  2022  2021
   MCh$  MCh$  MCh$
Personnel compensation   21,409    20,280    16,067 
Board members’ salaries and expenses   1,711    1,692    1,539 
Bonuses or gratifications   16,402    17,794    18,458 
Stock-based benefits (*)   2,119    (1,169)   (315)
Seniority compensation   2,312    6    512 
Pension plans   (1,251)   849    (873)
Training expenses   38    50    113 
Health funds   374    357    271 
Other personnel expenses   827    791    807 
Total   43,941    40,650    36,579 

 

(*)Some of the executives that qualified for this benefit left the Group for different reasons, without complying with the requirements to receive the benefit, therefore the obligation amount decreased, which generated the reversal of provisions.

 

f.Composition of key personnel

 

As of December 31, 2023, 2022 and 2021, the composition of the Bank’s key personnel is as follows:

 

   N° of executives
Position  As of December 31,
   2023  2022  2021
Director   11    11    11 
Manager   122    124    100 
Total key personnel   133    135    111 

 

F-120

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 35 - PENSION PLANS

 

The Bank has an additional benefit available to its principal executives, consisting of a pension plan. The purpose of the pension plan is to endow the executives with funds for a better supplementary pension upon their retirement.

 

For this purpose, the Bank will match the voluntary contributions made by the beneficiaries for their future pensions with an equivalent contribution. The executives will be entitled to receive this benefit only when they fulfill the following conditions:

 

a.Aimed at the Bank’s management

 

b.The general requisite to apply for this benefit is that the employee must be carrying out his/her duties when turning 60 years old

 

c.The Bank will create a pension fund, with life insurance, for each beneficiary in the plan. Periodic contributions into this fund are made by the manager and matched by the Bank

 

d.The Bank will be responsible for granting the benefits directly

 

If the working relationship between the manager and the respective company ends, before s/he fulfills the abovementioned requirements, s/he will have no rights under this benefit plan.

 

In the event of the executive’s death or total or partial disability, s/he will be entitled to receive this benefit.

 

The Bank will make contributions to this benefit plan on the basis of mixed collective insurance policies whose beneficiary is the Bank. The life insurance company with whom such policies are executed is not an entity linked or related to the Bank or any other Santander Group company.

 

Plan Assets owned by the Bank at the end of 2023 totaled MCh$5,260 (MCh$6,819 in 2022).

 

The amount of the defined benefit plans has been quantified by the Bank, based on the following criteria:

 

Calculation method:

 

Use of the projected unit credit method which considers each working year as generating an additional amount of rights over benefits and values each unit separately. It is calculated based primarily on fund contributions, as well as other factors such as the legal annual pension limit, seniority, age and yearly income for each unit valued individually.

 

Assets related to the pension fund contributed by the Bank into the Seguros Euroamérica insurance company with respect to defined benefit plans are presented as net of associated commitments.

 

Actuarial hypothesis assumptions:

 

Actuarial assumptions with respect to demographic and financial variables are non-biased and mutually compatible with each other. The most significant actuarial hypotheses considered in the calculations were:

 

   Post-employment
plans
  Post-employment
plans
   2023  2022
Mortality chart   RV-2014    RV-2014 
Termination of contract rates   
5,0%
   
5,0%
 
Impairment chart   PDT 1985    PDT 1985 

 

F-121

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 35 - PENSION PLANS, continued

 

Activity for post-employment benefits is as follows:

 

   As of December 31,
   2023  2022
   MCh$  MCh$
Plan assets   5,260    6,819 
Commitments for defined-benefit plans          
For active personnel   (5,027)   (6,277)
Incurred by inactive personnel   
-
    
-
 
Minus:          
Unrealized actuarial (gain) losses   
-
    
-
 
Balances at year end   233    542 

 

Year’s cash flow for post-employment benefits is as follows:

 

   For the years ended December 31,
   2023  2022  2021
   MCh$  MCh$  MCh$
a) Fair value of plan assets         
Opening balance   6,819    7,127    8,224 
Expected yield of insurance contracts   539    211    640 
Employer contributions   1,269    337    995 
Actuarial (gain) losses   
-
    
-
    
-
 
Premiums paid   
-
    
-
    
-
 
Benefits paid   (3,367)   (856)   (2,659)
Fair value of plan assets at year end   5,260    6,819    7,200 
                
b) Present value of obligations               
Present value of obligations opening balance   (6,277)   (6,633)   (7,551)
Net incorporation of Group companies   
-
    
-
    
-
 
Service cost   1,250    356    873 
Interest cost   
-
    
-
    
-
 
Curtailment/settlement effect   
-
    
-
    
-
 
Benefits paid   
-
    
-
    
-
 
Past service cost   
-
    
-
    
-
 
Actuarial (gain) losses   
-
    
-
    
-
 
Other   
-
    
-
    
-
 
Present value of obligations at year end   (5,027)   (6,277)   (6,678)
Net balance at year end   233    542    523 

 

F-122

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 35 - PENSION PLANS, continued

 

Plan expected profit:

 

   As of December 31,
   2023 2022 2021
Type of expected yield from the plan’s assets  UF + 2.50% annuallyUF + 2.50% annually UF + 2.50% annually
Type of yield expected from the reimbursement rights  UF + 2.50% annuallyUF + 2.50% annually UF + 2.50% annually

 

Plan associated expenses:

 

   For the years ended December 31,
   2023  2021  2020
   MCh$  MCh$  MCh$
Current period service expenses   1,250    356    (873)
Interest cost   
-
    
-
    
-
 
Expected yield from plan’s assets   539    211    (640)
Expected yield of insurance contracts linked to the Plan:   -    -      
Extraordinary allocations   
-
    
-
    
-
 
Actuarial (gain)/ losses recorded in the period   
-
    
-
    
-
 
Past service cost   
-
    
-
    
-
 
Other   
-
    
-
    
-
 
Total   1,789    567    (1,513)

 

F-123

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 36 - FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES

 

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The measurement of fair value assumes the sale transaction of an asset or the transference of the liability happens within the main asset or liability market, or the most advantageous market for the asset or liability.

 

For financial instruments with no available market prices, fair values have been estimated by 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.

 

These techniques are significantly influenced by the assumptions used, including the discount rate, the estimates of future cash flows and prepayment expectations. Hence, the fair value estimated for an asset or liability may not coincide exactly with the price at which that asset or liability could be delivered or settled on the date of its valuation and may not be justified in comparison with independent markets.

 

Except as detailed in the following table, management considers that the carrying amounts of financial assets and financial liabilities recognised in the consolidated financial statements approximate their fair values.

 

Determination of fair value of financial instruments

 

Below is a comparison between the value at which the Bank’s financial assets and liabilities are recorded and their fair value as of December 31, 2023 and 2022:

 

   As of December 31,
   2023  2022
   Book value  Fair value  Book value  Fair value
   MCh$  MCh$  MCh$  MCh$
Assets            
Financial assets for trading at FVTPL            
Financial derivative contracts   10,119,486    10,119,486    11,672,960    11,672,960 
Debt financial instruments   98,308    98,308    154,046    154,046 
Financial assets at FVOCI                    
Debt financial instrument   4,536,025    4,536,025    5,880,733    5,880,733 
Other financial instruments   105,257    105,257    142,306    142,306 
Financial derivative contracts for hedge accounting   605,529    605,529    477,762    477,762 
Financial assets at amortised cost                    
Debt financial instruments   8,176,895    7,927,729    4,867,591    4,496,503 
Interbank loans   68,438    68,438    32,991    32,918 
Loans and account receivable from customers   39,593,457    39,134,700    38,696,410    39,181,962 
Guarantee deposits (margin accounts)   2,338,900    2,338,900    2,442,325    2,442,325 
                     
Liabilities                    
Financial liabilities for trading at FVTPL                    
Financial derivative contracts   9,521,575    9,521,575    11,319,320    11,319,320 
Financial derivative contracts for accounting hedges   2,466,767    2,466,767    2,788,794    2,788,794 
Financial liabilities at amortised cost                    
Deposits and other demand liabilities   13,537,826    13,537,826    14,086,226    14,086,226 
Time deposits and other time liabilities   16,137,942    16,326,525    12,978,790    13,117,554 
Interbank borrowings   10,366,499    10,190,640    8,864,765    8,223,783 
Issued debt instruments   8,001,045    7,751,672    7,165,893    6,871,028 
Other financial liabilities   296,273    296,273    292,995    292,995 
Regulatory capital financial instruments   1,813,938    1,825,819    1,733,869    2,459,632 
Guarantees received (margin accounts)   1,081,226    1,081,226    1,017,968    1,017,968 

 

The fair value approximates the carrying amount of the following line items due to their short-term nature: cash and deposits-banks, cash items in process of collection and investments under resale or repurchase agreements.

 

In addition, the fair value estimates presented above do not attempt to estimate the value of the Bank’s profits generated by its business activity, nor its future activities, and accordingly, they do not represent the Bank’s value as a going concern. Below is a detail of the methods used to estimate the financial instruments’ fair value.

 

F-124

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 36 - FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES, continued

 

a.Financial assets held for trading and Debt instruments at FVOCI

 

The estimated fair value of these financial instruments was established using market values or estimates from an available dealer, or quoted market prices of similar financial instruments. Investments are evaluated at recorded value since they are considered as having a fair value not significantly different from their recorded value. To estimate the fair value of debt investments or representative values in these lines of businesses, we take into consideration additional variables and elements, as long as they apply, including the estimate of prepayment rates and credit risk of issuers.

 

b.Loans and accounts receivable at amortised cost

 

Fair value of commercial, mortgage and consumer loans and credit cards are measured through a discounted cash flow (DCF) analysis. We use current market interest rates considering product, term, amount and similar loan quality. Fair value of loans with 90 days or more of delinquency are measured by means of the market value of the associated guarantee, minus the rate and term of expected payment. For variable rate loans whose interest rates change frequently (monthly or quarterly) and that are not subjected to any significant credit risk change, the estimated fair value is based on their book value.

 

c.Deposits

 

Disclosed fair value of deposits that do not bear interest and saving accounts is the amount payable at the reporting date and, therefore, equals the recorded amount. Fair value of time deposits is calculated through a discounted cash flow calculation that applies current interest rates from a monthly calendar of scheduled maturities in the market.

 

d.Short and long term issued debt instruments

 

The fair value of these financial instruments is calculated by using a discounted cash flow analysis based on the current incremental lending rates for similar types of loans having similar maturities.

 

e.Financial derivative contracts for trading and hedge accounting

 

The estimated fair value of financial derivative contracts is calculated using the prices quoted on the market for financial instruments having similar characteristics.

 

The fair value of interest rate swaps represents the estimated amount that the Bank determines as exit price in accordance with IFRS 13. If there are no quoted prices from the market (either direct or indirect) for any derivative instrument, the respective fair value estimates have been calculated by using models and valuation techniques such as Black-Scholes, Hull, and Monte Carlo simulations, taking into consideration the relevant inputs/outputs such as volatility of options, observable correlations between underlying assets, counterparty credit risk, implicit price volatility, the velocity with which the volatility reverts to its average value, and the straight-line relationship (correlation) between the value of a market variable and its volatility, among others.

 

Measurement of fair value and hierarchy

 

IFRS 13 - Fair Value Measurement, provides a hierarchy of reasonable values which 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 three levels of the hierarchy of fair values are the following:

 

Level 1: the inputs are quoted prices (unadjusted) on active markets for identical assets and liabilities that the Bank can access on the measurement date

 

Level 2: inputs other than the quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly

 

Level 3: inputs are unobservable inputs for the asset or liability i.e. they are not based on observable market data

 

F-125

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 36 - FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES, continued

 

The hierarchy level within which the fair value measurement is categorized in its entirety is determined based on the lowest level of input that is significant to the fair value measurement in its entirety.

 

The best evidence of a financial instrument’s fair value at the initial time is the transaction price.

 

In cases where quoted market prices cannot be observed, Management makes its best estimate of the price that the market would set using its own internal models which in most cases use data based on observable market parameters as a significant input (Level 2) and, in very specific cases, significant inputs not observable in market data (Level 3), various techniques are employed to make these estimates, including the extrapolation of observable market data.

 

Financial instruments at fair value and determined by quotations published in active markets (Level 1) include:

 

-Chilean Government and Department of Treasury bonds

 

-Foreign instruments

 

-Mutual funds

 

Instruments which cannot be 100% observable in the market are valued according to other inputs observable in the market (Level 2).

 

The following financial instruments are classified under Level 2:

 

Type of
financial instrument
  Model
used in valuation
  Description of unobservable inputs
Mortgage and private bonds   Present Value of Cash Flows Model  

Internal Rates of Return (“IRRs”) are provided by RiskAmerica, according to the following criterion:

 

If, at the valuation day, there are one or more valid transactions at the Santiago Stock Exchange for a given nemotechnic, the reported rate is the weighted average amount of the observed rates.

 

In the case there are no valid transactions for a given mnemonic on the valuation day, the reported rate is the IRR base from a reference structure, plus a spread model based on historical spread for the same item or similar ones.

         
Time deposits   Present Value of Cash Flows Model  

IRRs are provided by RiskAmerica, according to the following criterion:

 

If, at the valuation day, there are one or more valid transactions at the Santiago Stock Exchange for a given mnemonic, the reported rate is the weighted average amount of the observed rates.

 

In the case there are no valid transactions for a given mnemonic on the valuation day, the reported rate is the IRR base from a reference structure, plus a spread model based on issuer curves.

         
Constant Maturity Swaps (CMS), FX and Inflation Forward (Fwd) , Cross Currency Swaps (CCS), Interest Rate Swap (IRS)   Present Value of Cash Flows Model  

IRRs are provided by ICAP, GFI, Tradition, and Bloomberg according to this criterion:

 

With published market prices, a valuation curve is created by the bootstrapping method and is then used to value different derivative instruments.

         
● FX Options   Black-Scholes  

Formula adjusted by the volatility simile (implicit volatility), Prices (volatility) are provided by BGC Partners, according to this criterion:

 

With published market prices, a volatility parameter is created by interpolation and then these volatilities are used to value options.

         
Guarantee deposits, guarantee received (Threshold)   Present Value of Cash Flows Model   Collateral associated to derivatives financial contracts: Average trading swap (CMS), FX and inflation Forward, Cross Currency Swap (CCS), Interest Rate Swap (IRS) y FX options.

 

F-126

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 36 - FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES, continued

 

In limited occasions significant inputs not observable in market data are used (Level 3). Several techniques are used to perform these estimates, including extrapolation of observable market data or a mix of observable data.

 

The following financial instruments are classified under Level 3:

 

Type of

financial instrument

 

Model

used in valuation

  Description of  unobservable inputs
Caps/Floors/Swaptions   Black Normal model for Cap/Floors and Swaptions   There is unobservable input of implied volatility.
         
    Black – Scholes   There is unobservable input of implied volatility.
         
    Hull-White   Hybrid HW model for rates and Brownian motion for FX. There is unobservable volatility input
         
    FRA Implicit   Start FW not supported by Murex (platform) due to UF FW estimation
         
● CCS, IRS, CMS at TAB rates   Present Value of Cash Flows Model  

- Valuation obtained using interest curve interpolating to maturity of flows, however, TAB is not a directly observable variable nor correlated to any market input.

 

- Valuation using prices of instruments with similar characteristics plus a liquidity penalty rate.

         
CCS (maturity> 30 years)   Present Value of Cash Flows Model  

The rates are provided by ICAP, GFI, Tradition and Bloomberg according following criteria:

 

Using the published market prices, the valuation curve is constructed using the bootstrapping method and this curve is then used to value the different derivatives.

         
● Debt instruments (in our case, low liquidity bonds)   Risk-free spread Model   Stochastic dynamic model to obtain discount rate.
         
● Loans and account receivable at FVOCI   Present Value of Cash Flows Model   Measured by discounting estimated cash flow using the interest rate of new contracts.

 

F-127

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 36 - FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES, continued

 

The Bank does not believe that any change in unobservable inputs with respect to level 3 instruments would result in a significantly different fair value measurement.

 

The following table presents the assets and liabilities that are measured at fair value on a recurrent basis:

 

   Fair value measurement 
As of December 31,  2023   Level 1   Level 2   Level 3 
   MCh$   MCh$   MCh$   MCh$ 
Assets                
Financial assets for trading at FVTPL                
Financial derivative contracts   10,119,486    
-
    10,119,486    
-
 
Debt financial instruments   98,308    98,308    
-
    
-
 
Financial assets at FVOCI                    
Debt financial instrument   4,536,025    4,528,915    6,656    454 
Other financial instruments   105,257    
 
    
 
    105,257 
Financial derivative contracts for hedge accounting   605,529    
-
    605,529    
-
 
Guarantee deposits (margin accounts)   2,238,900    
-
    2,238,900    
-
 
Total   17,703,505    4,627,223    12,970,571    105,711 
Liabilities                    
Financial liabilities for trading at FVTPL                    
Financial derivative contracts   9,521,575    
-
    9,521,575    
-
 
Financial derivative contracts for accounting hedges   2,466,767    
-
    2,466,767    
-
 
Guarantees received (margin accounts)   1,081,226    
-
    1,081,226    
-
 
Total   13,069,568    
-
    13,069,568    
-
 

 

   Fair value measurement 
As of December 31,  2022   Level 1   Level 2   Level 3 
   MCh$   MCh$   MCh$   MCh$ 
Assets                
Financial assets for trading at FVTPL                
Financial derivative contracts   11,672,960    
-
    11,672,922    38 
Debt financial instruments   154,046    154,046    
-
    
-
 
Financial assets at FVOCI                    
Debt financial instrument   5,880,733    5,870,407    9,894    432 
Other financial instruments   142,306    
-
    
-
    142,306 
Financial derivative contracts for hedge accounting   477,762    
-
    477,762    
-
 
Guarantee deposits (margin accounts)   2,442,327    
 
    2,442,327    
-
 
Total   20,770,134    6,024,453    14,602,905    142,776 
Liabilities                    
Financial liabilities for trading at FVTPL                    
Financial derivative contracts   11,319,320    
-
    11,319,320    
-
 
Financial derivative contracts for accounting hedges   2,788,794    
-
    2,788,794    
-
 
Guarantees received (margin accounts)   1,017,968    
-
    1,017,968    
-
 
Total   15,126,082    
-
    15,126,082    
-
 

 

F-128

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 36 - FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES, continued

 

The following table presents assets or liabilities which are not measured at fair value in the statements of financial position but for which the fair value is disclosed:

 

   Fair value measurement 
As of December 31,  2023   Level 1   Level 2   Level 3 
   MCh$   MCh$   MCh$   MCh$ 
Assets                
Financial assets at amortised cost                
Debt financial instruments   7,927,729    7,927,729    
-
    
 
 
Interbank loans   68,438    
-
    
-
    68,438 
Loans and account receivable from customers   39,134,700    
-
    
-
    39,134,700 
Total   47,132,078    7,927,729    
-
    39,204,349 
Liabilities                    
Financial liabilities at amortised cost                    
Deposits and other demand liabilities   13,537,826    
-
    
 
    13,537,826 
Time deposits and other time liabilities   16,326,525    
-
    16,326,525    
-
 
Interbank borrowings   10,190,640    
-
    10,190,640    
-
 
Issued debt instruments   7,751,672    
-
    7,751,672    
-
 
Other financial liabilities   296,273    
-
    296,273    
-
 
Regulatory capital financial instruments   1,825,819    
-
    1,825,819    
-
 
Total   49,928,755    
-
    36,390,929    13,537,826 

 

   Fair value measurement 
As of December 31,  2022   Level 1   Level 2   Level 3 
   MCh$   MCh$   MCh$   MCh$ 
Assets                
Financial assets at amortised cost                
Debt financial instruments   4,496,503    4,496,503    
-
    
-
 
Interbank loans   32,918    
-
    
-
    32,918 
Loans and account receivable from customers   39,181,962    
-
    
-
    39,181,962 
Total   43,711,383    4,496,503    
-
    39,214,880 
Liabilities                    
Financial liabilities at amortised cost                    
Deposits and other demand liabilities   14,086,226    
-
    
-
    14,086,226 
Time deposits and other time liabilities   13,117,554    
-
    13,117,554    
-
 
Interbank borrowings   8,223,783    
-
    8,223,783    
-
 
Issued debt instruments   6,871,028    
-
    6,871,028    
-
 
Other financial liabilities   292,995    
-
    292,995    
-
 
Regulatory capital financial instruments   2,459,632    
-
    2,459,632    
-
 
Total   45,051,218    
-
    30,964,992    14,086,226 

 

F-129

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 36 - FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES, continued

 

The fair values of other assets and other liabilities approximate their carrying values.

 

The methods and assumptions to estimate the fair value are defined below:

 

-Loans and amounts due from credit institutions and from customers – Fair value are estimated for groups of loans with similar characteristics. The fair value was measured by discounting estimated cash flow using the interest rate of new contracts. That is, the future cash flow of the current loan portfolio is estimated using the contractual rates, and then the new loans spread over the risk-free interest rate are incorporated to the risk-free yield curve in order to calculate the loan portfolio fair value. In terms of behavior assumptions, it is important to underline that a prepayment rate is applied to the loan portfolio, thus a more realistic future cash flow is achieved.

 

-Deposits and interbank borrowings – The fair value of deposits was calculated by discounting the difference between the cash flows on a contractual basis and current market rates for instruments with similar maturities. For variable-rate deposits, the carrying amount was considered to approximate fair value.

 

-Issued debt instruments and other financial liabilities – The fair value of long-term loans was estimated by cash flow discounted at the interest rate offered on the market with similar terms and maturities.

 

The valuation techniques used to estimate each level are defined in Note 1,i)

 

There were no transfers between levels 1 and 2 for the year ended December 31, 2023 and 2022.

 

The table below shows the effect, at December 31, 2023 and 2022, on the fair value of the main financial instruments classified as Level 3 of a reasonable change in the assumptions used in the valuation. This effect was determined by a sensitivity analysis under a 1bp scenario, detailed in the following table:

 

As of December 31, 2023
Instrument Level 3 Valuation technique Main unobservable
inputs

Impacts (in MCh$)

Sens, -1bp Unfavorable
scenario

Impacts (in MCh$)

Sens, +1bp Favorable
scenario

Financial derivatives contracts Present Value method Curves on TAB (1) - -
Debt financial instruments at FVOCI Internal rate of return method BR UF (2) (28.66) 28.66

 

As of December 31, 2022
Instrument Level 3 Valuation technique Main unobservable inputs

Impacts (in MCh$)

Sens, -1bp Unfavorable scenario

Impacts (in MCh$)

Sens, +1bp Favorable scenario

Financial derivatives contracts Present Value method Curves on TAB (1) (0.6) 0.6
Debt financial instruments at FVOCI Internal rate of return method BR UF (2) (0.07) 0.07

 

(1)TAB: “Tasa Activa Bancaria” (Active Bank Rate). Average interest rates on 30, 90, 180 and 360 day deposits published by the Chilean Association of Banks and Financial Institutions (ABIF) in nominal currency (Chilean peso) and in real terms, adjusted for inflation (in Chilean unit of account (Unidad de Fomento - UF)).

(2)BR: “Bonos de Reconocimiento” (Recognition Bonds). The Recognition Bond is an instrument of money provided by the State of Chile to workers who joined the new pension system, which began operating since 1981.

 

F-130

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 36 - FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES, continued

 

The following table presents the Bank’s activity for assets and liabilities measured at fair value on a recurrent basis using unobserved significant inputs (Level 3) as of December 31, 2023, 2022 and 2021:

 

   Assets   Liabilities 
   MCh$   MCh$ 
As of January 1, 2023   142,776    
      -
 
Total realized and unrealized profits (losses)          
Included in statements of income   (19)   
-
 
Included in other comprehensive income   9,352    
-
 
Purchases, issuances, and loans (net)   (46,398)   
-
 
Level transfer   
 
    
-
 
As of December 31, 2023   105,711    
-
 
           
Total profits or losses included in comprehensive income for 2022 that are attributable to change in unrealized profit (losses) related to assets or liabilities as of December 31, 2023   (37,065)   
-
 

 

   Assets   Liabilities 
   MCh$   MCh$ 
As of January 1, 2022   102,426    
      -
 
Total realized and unrealized profits (losses)          
Included in statements of income   139,848    
-
 
Included in other comprehensive income   (99,498)   
-
 
Purchases, issuances, and loans (net)   
-
    
-
 
Level transfer   
-
    
-
 
As of December 31, 2022   142,776    
-
 
           
Total profits or losses included in comprehensive income for 2022 that are attributable to change in unrealized profit (losses) related to assets or liabilities as of December 31, 2022   40,350    
-
 

 

F-131

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 36 - FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES, continued

 

   Assets   Liabilities 
   MCh$   MCh$ 
As of January 1, 2021   77,458    2,760 
Total realized and unrealized profits (losses)          
Included in statements of income   (4,711)   
-
 
Included in other comprehensive income   30,073    
-
 
Purchases, issuances, and loans (net)   
-
    
-
 
Level transfer   (394)   (2,760)
As of December 31, 2021   102,426    
-
 
           
Total profits or losses included in comprehensive income for 2021 that are attributable to change in unrealized profit (losses) related to assets or liabilities as of December 31, 2021   24,968    (2,760)

 

The realized and unrealized profits (losses) included in comprehensive income for 2023 and 2022, in the assets and liabilities measured at fair value on a recurrent basis through unobservable market data (Level 3) are recorded in the Statements of Comprehensive Income.

 

The potential effect as of December 31, 2023 and 2022 on the valuation of assets and liabilities valued at fair value on a recurrent basis through unobservable significant inputs (level 3), generated by changes in the principal assumptions if other reasonably possible assumptions that are less or more favorable were used, is not considered by the Bank to be significant.

 

The following tables show the financial instruments subject to compensation in accordance with IAS 32, for 2023 and 2022:

 

As of December 31, 2023
   On-balance sheet amounts with netting agreements         
Financial instruments  Gross
amounts
   Compensated
in balance
   Net amount presented
in balance
   Remaining financial
instruments not linked,
nor subject to neeting
agreements
   Statements of
Financial Position
balances
 
Assets  Ch$ Million   Ch$ Million   Ch$ Million   Ch$ Million   Ch$ Million 
Financial derivative contracts and hedge accounting (1)   10,575,817    
        -
    10,575,817    149,198    10,725,015 
Loans and accounts receivable and interbank loans (2)   
-
    
-
    
-
    39,657,783    39,657,783 
Total   10,575,817    
-
    10,575,817    39,806,981    50,382,798 
Liabilities                         
Financial derivative contracts and hedge accounting   11,732,137    
-
    11,732,137    256,205    11,988,342 
Investments under resale agreements   282,584    
-
    282,584    
-
    282,584 
Deposits and interbank borrowings   
-
    
-
    
-
    40,042,267    40,042,267 
Total   12,014,721    
-
    12,014,721    40,298,472    52,313,193 

 

(1)Derivatives contract have guarantees associated for Ch$2,225,820 million and Ch$839,201, respectively.
(2)Loans and accounts receivable and interbank loans at amortised cost

 

F-132

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 36 - FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES, continued

 

As of December 31, 2022
   On-balance sheet amounts with netting agreements         
Financial instruments  Gross
amounts
   Compensated
in balance
   Net amount presented
in balance
   Remaining financial
instruments not  subject to neeting agreements
   Amount in
Statements of
Financial Position
 
Assets  Ch$ Million   Ch$ Million   Ch$ Million   Ch$ Million   Ch$ Million 
Financial derivative contracts and hedge accounting (1)   10,280,291    
-
    10,280,291    1,870,431    12,150,722 
Loans and accounts receivable and interbank loans (2)   
-
    
-
    
-
    37,692,840    37,692,840 
Total   10,280,291    
-
    10,280,291    39,563,271    49,843,562 
Liabilities                         
Financial derivative contracts and hedge accounting   11,365,281    
-
    11,365,281    2,742,833    14,108,114 
Investments under resale agreements   315,355    .    315,355    
-
    315,355 
Deposits and interbank borrowings (3)   
-
    
-
    
-
    35,929,781    35,929,780 
Total   11,680,636    
-
    11,680,636    38,672,614    50,353,249 

 

(1)Derivatives contract have guarantees associated for Ch$1,695,431 million and Ch$746,729, respectively.
(2)Loans and accounts receivable and interbank loans at amortised cost
(3)Include Deposits and other demand liabilities, Time deposits and other time liabilities and interbank borrowings

 

The Bank, in order to reduce its credit exposure in its financial derivative operations, has entered into collateral contracts with its counterparties, in which it establishes the terms and conditions under which they operate. In terms collateral (received/delivered) operates when the net of the fair value of the financial instruments held exceed the thresholds defined in the respective contracts.

 

   As of December 31, 2023   As of December 31, 2022 
Financial derivative contracts  Assets   Liability   Assets   Liability 
   MCh$   MCh$   MCh$   MCh$ 
Financial derivative contracts with collateral agreement threshold equal to zero   9,802,491    10,836,243    8,177,074    9,588,768 
Financial derivative contracts with non-zero threshold collateral agreement   773,325    895,894    440,091    536,318 
Financial derivative contracts without collateral agreement   149,199    256,205    3,533,557    3,983,028 
Total   10,725,015    11,988,342    12,150,722    14,108,114 

 

F-133

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT

 

Introduction and general description

 

Banco Santander Chile, in its position of leadership in the local banking industry, has placed risk management at the centre of its activity to ensure that the entire organisation acts responsibly in the new social context, economic changes, customer demands and the business environment, always aligned with the strong corporate culture and the legal regulations in force. The risk management and control model is underpinned by a set of common principles, a risk culture embedded throughout the Bank, a strong governance structure, and advanced risk management processes and tools.

 

Banco Santander’s risk management and control principles are mandatory, must always be applied, and comprise the regulatory requirements and best market practices. They are:

 

1.A strong risk culture (Risk Pro) that all employees follow covers all risks and promotes socially responsible management, contributing to the Bank’s long-term sustainability.

 

2.All employees are responsible for risk management and must know and understand the risks generated by their daily activities, avoiding taking risks whose impact is unknown or exceeds the limits of the Bank’s risk appetite.

 

3.Involvement of senior management, by ensuring the consistent risk management and control through their conduct, actions and communications. In addition, promoting a risk culture, evaluating implementation degree and monitoring that the profile remains within the levels defined in the Bank’s risk appetite.

 

4.Independence of risk management and control functions.

 

5.Proactive and comprehensive risk management and control approach across all businesses and risk types.

 

6.Adequate and comprehensive information management enables risks to be identified, assessed, managed and communicated appropriately to the correct levels.

 

These Santander principles, together with several interrelated tools and processes that are part of its strategic planning, such as the risk appetite statement, risk profile assessment, scenario analysis and risk reporting structure, as well as the annual budget processes, form a holistic control structure for the entire Bank.

 

Governance structure

 

Banco Santander’s corporate governance is structured in three levels, each of which is accompanied by support committees:

 

-Board of Directors, which represents the highest governing body.

 

-Senior Management, headed by the Chief Executive Officer.

 

-Shareholders’ Meeting

 

The Board of Directors comprises 11 directors, with nine acting in the capacity of full directors and two alternate directors and six of them are independent directors. The mail role is to participate in the organisation’s strategic planning and to ensure that the commitments proposed in the short, medium and long term are fulfilled in a timely manner.

 

Risk committee structure

 

Banco Santander-Chile has five committees supporting the Board, appointed and modified by them as deemed necessary. The various committees respond and report their activity to the Board systematically, through meetings and based on subrogation schemes, bylaws, formal minutes and follow-up instances. The Bank’s Board support committees are responsible for decision-making on priority issues, including economic, environmental and social issues.

 

A.Directors and Audit Committee

 

The main responsibility is to support the Board of Directors in the continuous improvement of internal control, review of the external auditors’ work, the Internal Audit Department and the supervision of the financial statements elaboration, in orden to provide adequate information for shareholders, investors and general public. The Committee also monitored Chilean regulatory estandards updated and propose external auditors to the Board of Directors, which are subsequently approved at the shareholders meeting.

 

F-134

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

B.Integral Risk Committee

 

The Integral Risk Committee is responsible for advising the Board of Directors in defining the risk appetite, risk framework as well as supervising the correct identification, measurement and control of all risks the Bank faces. Also, supervises the risk measurement and control systems.

 

C.ALCO and Market Committee

 

The main functions of the ALCO (Asset and liabilities committee) are to monitor and control the structural risks of the balance, such as limits of exposure to inflation, interest rate risk, capital and liquidity funding levels. Also, review the behavior of relevant local and international markets and local monetary policies.

 

D.Designation Committee

 

This committee constantly reviews and applies the policies and designation processes of those positions defined as “key positions” in particular, as well as the review of these with respect to the other members of the organization in general.

 

E.Remuneration Committee

 

This committee constantly reviews the regulatory documentation concerning the evaluation and remuneration of positions defined as ‘key positions’ and other persons in the organisation in general.

 

The Risk and Internal Audit functions have the appropriate separation and independence level and direct access to the Board and its committees. The Board delegates the identification, measurement and control of the various risks faced by the Bank to the Risk Division, which is led by the Chief Risk Officer (CRO), and reports directly to the CEO. The Chief Risk Officer (CRO) is responsible for monitoring all risks and reviewing and advising the business lines on managing these risks. This division is responsible for credit, market, non-financial, compliance, and reputational risks. The Director of Internal Audit reports directly to the Chairman of the Board of Directors to ensure independence from Senior Management and thus be an effective third line of defence in risk management and internal control.

 

Risk management

 

Banco Santander Chile has a solid risk culture known as Risk Pro, which defines how risks are understood and managed daily based on the principle that all employees are responsible for risk management. Therefore, their classification is fundamental for effective management and control. All identified risks are to be linked to their according risk category to organise their management, control and related information. Banco Santander Chile’s risk classification enables effective risk management, control and communication. Its corporate risk framework includes the following:

 

Market risk: rises from holding financial instruments whose value may be affected by fluctuations in market conditions, generally including the following types of risk:

 

-Foreign exchange risk: this arises as a consequence of exchange rate fluctuations among currencies.

 

-Interest rate risk: this arises as a consequence of fluctuations in market interest rates.

 

-Price risk: this arises as a consequence of changes in market prices, either due to factors specific to the instrument itself or due to factors that affect all the instruments negotiated in the market.

 

-Inflation risk: this arises as a consequence of changes in Chile’s inflation rate, whose effect would be mainly applicable to financial instruments denominated in UFs.

 

Credit risk: this is the risk that one of the parties to a financial instrument fails to meet its contractual obligations for reasons of insolvency or inability of the individuals or legal entities in question to continue as a going concern, causing a financial loss to the other party.

 

F-135

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

Liquidity risk: is the possibility that an entity may be unable to meet its payment commitments, or that in order to meet them, it may have to raise funds with onerous terms or risk damage to its image and reputation.

 

Operational risk: the risk of loss due to inadequate or failed internal processes, people or systems or external events, and have legal, regulatory and reputational effect.

 

Capital risk: this is the risk that the Bank may have an insufficient amount and/or quality of capital to meet the minimum regulatory requirement to operate as a bank, respond to market expectations regarding its creditworthiness, and support its business growth and any strategic possibilities that might arise, in accordance with its strategic plan.

 

Risk governance

 

The Bank has a robust risk governance structure that pursues effective control of the risk profile, following the appetite defined by the Board and based on the distribution of roles among the three lines of defence and a strong committee structure, which is reinforced by the Risk Pro culture that applies throughout the organisation.

 

First line

 

Business and all other functions that create risk are the first line of defense. These functions must ensure that the risks they generate are aligned with the approved risk appetite and the corresponding limits. Any unit that originates risk has primary responsibility for managing that risk.

 

Second line

 

The Risk and Compliance and Conduct functions. Their role is to independently monitor and challenge the risk management activities carried out by the first line of defence. These functions ensure risk management in accordance with the appetite defined by the Board of Directors and promote a solid risk culture throughout the organization

 

Third line

 

The Internal Audit function periodically evaluates that policies, methodologies and procedures are adequate and are effectively implemented in the management and control of all risks.

 

Risk governance assessment

 

Risk governance also has several internal and external assessment processes to verify that the governance and approach are adequate. The FMC shall permanently maintain banks’ management and solvency rating.

 

Banco Santander Chile is classified under Category 1 as it was graded as Level A in both solvency and management.

 

Market risk

 

Market risk arises as a consequence of the market activity, through financial instruments whose value can be affected by changes in market conditions and reflected in financial assets/liabilities and financial risk factors. The risk can be diminished by means of hedging through other products (assets/liabilities or derivative instruments) or terminating the open transaction/position. The objective of market risk management is to manage and control market risk exposure within acceptable parameters.

 

There are four major risk factors that affect the market prices: type of interest, type of exchange, price, and inflation. In addition and for certain positions, it is necessary to consider other risks as well, such as spread risk, base risk, commodity risk, volatility or correlation risk.

 

Market risk management

 

The Market Risk Department is responsible for measurement and control of market risks that are overseen by the Risk Division. Market Committee and the Assets and Liabilities Committee are responsible for the approval of limits. The main market risks are also reviewed in the CIR.

 

F-136

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

The Finance Division, through the Financial Management Department, is responsible for managing the Bank’s balance sheet, supervised and controlled by the Assets and Liabilities Committee and the Risk Division. Among its functions is the elaboration of detailed policies and their application, as well as the following:

 

i.Optimization of the liabilities’ cost, searching the most efficient financing strategies, including bonds’ issuance and bank credit lines.

 

ii.Management of short and long-term liquidity regulatory limits.

 

iii.Inflation risk management.

 

iv.Rate risk management in local and foreign currency.

 

The Bank’s internal management to measure market risk is mainly based on analyzing the three following portfolios:

 

trading portfolio

 

local financial management portfolio

 

foreign financial management portfolio

 

The Treasury Department is responsible for managing the Bank’s trading portfolios and keeping them within the loss limits, calculated and estimated by the Market Risk Management. The trading portfolio (measured at fair value through profit and loss) is comprised of investments valued at fair market value and free of any restriction on their immediate sale, which are often bought and sold by the Bank with the intention of selling them in the short term to benefit from short–term price fluctuations. The trading portfolio also includes the Bank’s exposure to foreign currency. The financial management portfolios include all the financial investments not considered to be part of trading portfolio.

 

The main functions in connection with trading portfolio include the following:

 

i.applies the “Value at Risk” (VaR) techniques to measure interest rate risk,

 

ii.adjust the trading portfolios to market and measure the daily income and loss from commercial activities,

 

iii.compare the real VaR with the established limits,

 

iv.establish procedures to prevent losses in excess of predetermined limits, and

 

v.furnishes information on the trading activities to the ALCO, other members of the Bank’s management, and the Global Risk Department of Banco Santander Spain.

 

The main functions in connection with financial management portfolios include the following:

 

i.performs sensitivity simulations (as explained below) to measure interest rate risk for activities denominated in local currency and the potential losses forecasted by these simulations.

 

ii.provide daily reports thereon to the ALCO, other members of the Bank’s management, and the Global Risk Department of Banco Santander Spain.

 

Market risk – management of trading portfolio

 

The Bank applies VaR methodologies to measure the market risk of its trading portfolio. The Bank has a consolidated commercial position comprised of fixed–income investments and foreign currency trading. This portfolio is comprised mostly of Central Bank of Chile bonds, mortgage bonds, locally issued, low–risk corporate bonds and foreign currencies, mainly U.S. dollars. At the end of each year, the trading portfolio included no stock portfolio investments.

 

F-137

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

For the Bank, the VaR estimate is made under the historical simulation methodology, which consists of observing the behavior of the profits and losses that would have occurred in the current portfolio if the market conditions for a given historical period had been in force, in order to infer the maximum loss on the basis of that information, with a given degree of confidence. The methodology has the advantage of precisely reflecting the historical distribution of the market variables and not requiring any assumptions regarding the distribution of specific probabilities. All the VaR measures are intended to determine the distribution function for a change in the value of a given portfolio, and once that distribution is known, to calculate the percentile related to the necessary degree of confidence, which will be equal to the value at risk by virtue of those parameters. As calculated by the Bank, the VaR is an estimate of the maximum expected loss of market value for a given portfolio over a 1–day horizon, with a 99.00% confidence level. It is the maximum 1–day loss that the Bank could expect to experience in a given portfolio, with a 99.00% confidence level. In other words, it is the loss that the Bank would expect to experience only 1.0% of the time. The VaR provides a single estimate of market risk which is not comparable from one market risk to another. Returns are calculated through the use of a 2–year time window or at least 520 data points obtained since the last reference date for calculation of the VaR going backward in time.

 

We do not calculate three separate VaRs. We calculate a single VaR for the entire trading portfolio, which in addition is segregated by risk type. The VaR software performs a historical simulation and calculates a Profit and Loss Statement (P&L) for 520 data points (days) for each risk factor (fixed income, foreign currency and variable income.) The P&L of each risk factor is added together and a consolidated VaR is calculated with 520 points or days of data. At the same time a VaR is calculated for each risk factor based on the individual P&L calculated for each individual risk factor. Furthermore, a weighted VaR is calculated in the manner described above, but which gives a greater weighting to the 30 most recent data points. The larger of the two VaRs is the one that is reported. In 2023, 2023 and 2022, we used the same VaR model and there has been no change in methodology or assumptions for subsequent periods.

 

The Bank uses the VaR estimates to provide a warning when the statistically estimated incurred losses in its trading portfolio would exceed prudent levels, and hence, there are certain predetermined limits.

 

Limitations of the VaR model

 

When applying a calculation methodology, no assumptions are made regarding the probability distribution of the changes in the risk factors; the historically observed changes are used for the risk factors on which each position in the portfolio will be valued.

 

It is necessary to define a valuation function fj(xi) for each instrument, preferably the same one used to calculate the market value and income of the daily position, This valuation function will be applied in each scenario to generate simulated prices for all the instruments in each scenario.

 

In addition, the VaR methodology should be interpreted taking into consideration the following limitations:

 

Changes in market rates and prices may not be independent and identically distributed random variables and may not have a normal distribution. In particular, the assumption of normal distribution may underestimate the probability of extreme market movements;

 

The historical data used by the Bank may not provide the best estimate of the joint distribution of changes in the risk factors in the future, and any modification of the data may be inadequate. In particular, the use of historical data may fail to capture the risk of potential extreme and adverse market fluctuations, regardless of the time period used;

 

A 1-day time horizon may not fully capture the market risk positions which cannot be liquidated or covered in a single day, It would not be possible to liquidate or cover all the positions in a single day;

 

F-138

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

The VaR is calculated at the close of business, but trading positions may change substantially in the course of the trading day;

 

The use of a 99% level of confidence does not take account of, or make any statement about, the losses that could occur outside of that degree of confidence; and

 

A model such as the VaR does not capture all the complex effects of the risk factors over the value of the positions or portfolios, and accordingly, it could underestimate potential losses,

 

We perform back-testing daily and generally find that trading losses exceed our VaR estimate approximately one out of every 100 trading days. At the same time, we set a limit to the maximum VaR that we are willing to accept over our trading portfolio. In both 2021 and 2020, the Bank has remained within the maximum limit established for the VaR, even in those circumstances in which actual VaR exceed the estimated VaR.

 

High, low and average levels for each component for 2023 and 2022 were as follows:

 

VaR 

2023

USDMM

  

2022

USDMM

 
Consolidated        
High   6.81    6.23 
Low   2.61    2.73 
Average   4.09    4.41 
           
Fixed-income investments          
High   5.06    5.78 
Low   2.11    2.75 
Average   3.15    4.20 
           
Variable-income investments          
High   
-
    - 
Low   
-
    
-
 
Average   
-
    - 
           
Foreign currency investments          
High   5.79    4.82 
Low   0.23    0.17 
Average   2.20    1.14 

 

Market risk - local and foreign financial management

 

The Bank’s financial management portfolio includes most of the Bank’s non-trading assets and liabilities, including the credit/loan portfolio. For these portfolios, investment and financing decisions are strongly influenced by the Bank’s commercial strategies.

 

The Bank uses a sensitivity analysis to measure the market risk of local and foreign currencies (not included in the trading portfolio). The Bank performs a simulation of scenarios, which will be calculated as the difference between the present value of the flows in the chosen scenario (a curve with a parallel movement of 100 bps in all its segments) and their value in the base scenario (current market). All the inflation–indexed local currency (UF) positions are adjusted by a sensitivity factor of 0.57, which represents a 57-basis, point change in the rate curve for the real rates and a 100 basis point change for the nominal rates. The same scenario is performed for the net foreign currency positions and the interest rates in U.S. dollars. The Bank has also established limits in regard to the maximum loss which these interest rate movements could impose on the capital and net financial income budgeted for the year.

 

For the consolidated limit, we add the foreign currency limit to the domestic currency limit and multiple by 2 the sum of the multiplication of them together both for net financial loss limit as well as for the capital and reserves loss limit, using the following formula:

 

Consolidated limit = square root of a2 + b2 + 2ab

 

a: domestic currency limit

 

b: foreign currency limit

 

Since we assume the correlation is 0; 2ab = 0, 2ab = 0

 

F-139

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

Limitations of the sensitivity models

 

The most important assumption is using an exchange rate of 100 bp based on yield curve (57 bp for real rates). The Bank uses a 100 bp exchange since sudden changes of this magnitude are considered realistic. Santander Spain Global Risk Department has also established comparable limits by country, to be able to compare, monitor and consolidate market risk by country in a realistic and orderly way. In addition, the sensitivity simulation methodology should be interpreted taking into consideration the following limitations:

 

The simulation of scenarios assumes that the volumes remain consistent in the Bank’s Consolidated Statements of Financial Position and are always renewed at maturity, thereby omitting the fact that certain credit risk and prepayment considerations may affect the maturity of certain positions.

 

This model assumes an identical change along the entire length of the yield curve and does not take into account the different movements for different maturities.

 

The model does not take into account the sensitivity of volumes which results from interest rate changes.

 

The limits to losses of budgeted financial income are calculated based on the financial income foreseen for the year, which may not be actually earned, meaning that the real percentage of financial income at risk may be higher than the expected one.

 

Market risk – Financial management portfolio – December 31, 2023 and 2022

 

   2023   2022 
   Effect on
financial
income
   Effect on
capital
   Effect on
financial
income
   Effect on
capital
 
                 
Financial management portfolio – local currency (MCh$)                
Loss limit   124.904    353.718    33,550    95,710 
High   79.657    173.389    23,982    57,176 
Low   41.151    88.382    15,459    39,957 
Average   62.740    133.464    21,366    49,580 
Financial management portfolio – foreign currency (Th$US)                    
Loss limit   157.400    174.889    38,231    43,329 
High   17.775    91.935    9,713    33,388 
Low   227    53.436    255    20,371 
Average   9.718    70.397    3,173    26,310 
Financial management portfolio – consolidated (in MCh$)                    
Loss limit   124.904    353.718    33,550    95,710 
High   75.816    283.550    28,699    76,738 
Low   34.663    246.664    16,515    66,098 
Average   64.477    268.776    23,438    71,003 

 

Inflation risk

 

The Bank has readjustable assets and liabilities according to the variation of the Unidad de Fomento (UF). In general, the Bank has more assets than liabilities in UF and, therefore, moderate increases in inflation have a positive effect on income from readjustments, while a fall in the value of the UF negatively affects the Bank’s margin. The Assets and Liabilities Committee establishes a set of limits on the difference between UF-denominated assets and liabilities that cannot exceed 30% of the Bank’s interest-bearing assets. This mismatch is managed on a daily basis by Financial Management and the limits are calculated and monitored by the Market Risk Division.

 

F-140

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

Market Risk Position and measurement

 

Market Risk Exposure is measured and controlled through the difference between the balances of assets and liabilities in foreign currency (net position) and the cash flows payable (liabilities) and cash receivable (asset) in the Trading and Banking Books, for a specific term or time band.

 

Foreign currency positions and term mismatches are exposed to adjustment factors, sensitivity and rate changes.

 

The Exposure to Market Risks on a Standardized Base Policy was presented and approved by the Bank’s Board of Directors.

 

Market Risk Exposure is determined based on the following risks:

 

Interest rate risk

 

Currency Risk

 

Indexation Risk

 

Currency Options Risk

 

The following table illustrates the exposure to market risk. The maximum exposure to long-term interest rate risk is 35% of the regulatory capital and is approved by the Board of Directors. The maximum exposure to short-term interest rate risk is 55% of net interest income and readjustments plus interest rate sensitive commissions:

 

   As of december 31,
   2023  2022
   MCh$  MCh$
Market risk – trading protfolio      
Exposure to rate risk   371,203    441,688 
Exposure to currency risk   9,130    1,535 
Interest rate option risk   
-
    
-
 
Currency option risk   3,167    1,145 
Total exposure of trading portfolio   383,500    444,368 
10% of RWA   479,374    555,460 
Subtotal   862,874    999,828 
Limit = Regulatory capital   6,978,733    6,759,047 
Available margin   6,115,859    5,759,219 
           
Market risk – short-term financial management portfolio          
Short Term Exposure to Interest Rate Risk   97,410    193,895 
Exposure to Infaltion Risk   161,222    112,523 
Short-term exposure of financial management portfolio   258,632    306,418 
Limit = 35% net (net income from interest and readjustments + interest rates sensitive commissions)   575,483    530,199 
Available margin   316,851    223,781 
           
Market risk – long-term financial management portfolio          
Long Term Exposure to Interest Rate Risk   1,057,637    1,194,181 
Limit = 35% Regulatory capital   2,442,556    2,365,666 
Available margin   1,384,919    1,171,485 

 

IBOR – reform

 

In 2013, The IOSCO Principles for Financial Benchmarks were published with the aim of creating an overarching framework for the development of reference index. Subsequently, the FSB established an Official Sector Steering Group (OSSG) which is working to monitor and support progress on implementing interest rate benchmark reforms and facilitate the transition away from LIBOR (and other IBORs where appropriate). Since then, central banks and regulators from different jurisdictions have organized working groups to recommend alternative index for EONIA (Euro Overnight Index Average) and LIBOR (London Interbank Offered Rates).In September 13, 2018 the European Central Bank recommended the euro short-term rate (ESTER) as alternative euro risk- free rate and replacement for EONIA. On October 2, 2019 ECB published the first €STR, since then, the current EONIA methodology has been modified to become €STR plus a fixed spread of 8.5 basis points, in order to maintain EONIA for a transitional period until its discontinuation in January 3, 2022.

 

F-141

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

In March 5, 2021, the Financial Conduct Authority (FCA) announced the cessation or loss of representativeness of the LIBOR benchmarks, published by ICE Benchmark Administration (IBA), as follows:

 

-Publication of euro LIBOR, Swiss franc LIBOR, Japanese yen LIBOR, sterling LIBOR, and US dollar LIBOR (1-week and 2-month) will cease immediately after 31 December 2021.

 

-Publication of the overnight and 12-month US dollar LIBOR will cease immediately after 30 June 2023.

 

-Changing methodology calculation to obtain synthetic LIBOR for sterling LIBOR and Japanese yen LIBOR for a further period after end-2021.

 

In October 2020, the ISDA launched the IBOR Fallbacks Supplement and IBOR Fallbacks Protocol. The fallbacks for a particular currency apply following a permanent cessation of the IBOR/LIBOR in that currency. In each case, the fallbacks will be adjusted versions of the risk-free rates identified in each currency. The fallbacks coming into effect on January 25, 2021. Additionally, on August 19, 2021, the ISDA has published ISDA 2021 EONIA Collateral Agreement Fallbacks offering an efficient way to amend the terms of certain ISDA collateral agreements incorporating a fallback upon the cessation of EONIA.

 

In 2019, the Bank launched a global programme to manage risks and challenges of the IBOR transition. This programme facilitated the process of risk identification and the selection of the most appropriate response to mitigate those risks. The structure of the programme focuses on the following areas: Technology and Operations, Legal, Customer Relations, Risk Management and Models, Conduct and Communication, and Accounting and Finance. Therefore, the Bank has been working since 2019 in a “transition programme” to manage the identified risks and address the challenges that may arise in the transition period.

 

In July 2023, the global financial industry marked a significant milestone as the longanticipated transition away from LIBOR, successfully concluded. This transition has been a comprehensive and collaborative effort involving market participants, regulatory authorities and industry bodies.

 

The main replacements for LIBOR include the Secured Overnight Financing Rate (SOFR) for US Dollar, the Sterling Overnight Index Average (SONIA) for Sterling Pound, the Euro ShortTerm Rate (€STR) for the European Euro, the Tokyo Overnight Average Rate (TONA) for Japanese Yen, and the Swiss Reference Rates (SARON) for the Swiss Franc. These rates, which are based on actual transactions, provide a reliable foundation for pricing and valuing financial instruments.

 

As part of the LIBOR transition process, regulatory authorities have also considered the need for continuity in certain contracts that are reliant on LIBOR. In order to mitigate market disruptions and provide a temporary solution, a synthetic LIBOR is still being published for 3month GBP LIBOR, and 1-month, 3-month and 6-month USD LIBOR, which are expected to cease on 31st March 2024 (GBP LIBOR) and 31st September 2024 (USD LIBOR).

 

Credit risk

 

Credit risk is the risk that one of the parties to a financial instrument fails to meet its contractual obligations for reasons of insolvency or inability of the individuals or legal entities in question to continue as a going concern, causing a financial loss to the other party. The Bank consolidates all elements and components of credit risk exposure to manage credit risk (i.e., individual delinquency risk, inherent risk of a business line or segment, and/or geographical risk).

 

Credit Risk Management

 

The Bank has established a combined credit approval committees, which includes member from Board of Directors, Risk Division and commercial areas, who overally verify quantitative and qualitative parameters of each client.

 

The Board of Directors has delegated the responsibility for credit risk management to the Integral Risk Committee, as well as to the Bank’s risk departments, whose roles are summarised below:

 

Formulate credit policies by consulting with the business units, meeting requirements of guarantees, credit evaluation, risk rating and submitting reports, documentation and legal procedures in compliance with the regulatory, legal and internal requirements of the Bank.

 

Establish the structure to approve and renew credit requests. The Bank structures credit risks by assigning limits to the concentration of credit risk in terms of individual debtor, debtor group, industry segment and country.

 

Limit concentrations of exposure to customers or counterparties in geographic areas or industries (for accounts receivable or loans), and by issuer, credit rating and liquidity.

 

F-142

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

Approval levels are assigned to the corresponding officials of the business unit (commercial, consumer, SMEs) to be exercised by that level of management. In addition, those limits are continually revised. Risk evaluation team at the branch level interact on a regular basis with customers; however, for larger credit requests, the risk team from the head office and the Executive Risk Committee works directly with customers to assess credit risks and prepare risk requests.

 

Develop and maintain the Bank’s credit risk classifications for the purpose of classifying risks according to the degree of exposure to financial loss that is exhibited by the respective financial instruments, with the aim of focusing risk management specifically on the associated risks.

 

Revise and evaluate credit risk. Management’s risk divisions are largely independent of the Bank’s commercial division and evaluate all credit risks in excess of the specified limits prior to loan approvals for customers or prior to the acquisition of specific investments. Credit renewal and reviews are subject to similar processes.

 

The following diagram illustrates the governance of our credit risk division including the committees with approval power:

 

 

Credit Approval: Loans approved on an individual basis

 

In preparing a credit proposal for a corporate client whose loans are approved on an individual basis, Santander-Chile’s personnel verifies such parameters as debt servicing capacity (typically including projected cash flows), the company’s financial history and projections for the economic sector in which it operates. The Risk Division is closely involved in this process and prepares the credit application for the client. All proposals contain an analysis of the client, a rating and a recommendation. Credit limits are determined not on the basis of outstanding balances of individual clients, but on the direct and indirect credit risk of entire financial groups. For example, a corporation will be evaluated together with its subsidiaries and affiliates.

 

Credit Approval: Loans approved on a group basis

 

The majority of loans to individuals and small and mid-sized companies are approved by the Standardized Risk Area through an automated credit scoring system. This system is decentralized, automated and based on multiple parameters, including demographic and information regarding credit behavior from external sources and the FMC.

 

Credit approval: Investment on debt instruments

 

The Bank considers the probability of default of issuers or counterparties using internal and external information such as independent risk evaluators of the Bank. In addition, the Bank applied a strong governance and conservative policy which ensures that the issuers of investments and counterparties in derivative instrument transactions are of the highest quality.

 

F-143

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

Credit approval: Contingent loans

 

The Bank operates with contingent loans that entail exposure to credit risk such as: personal guarantees, letters of credit, performance guarantees, credit lines and credit commitments.

 

Personal guarantees represent an irrevocable payment obligation. When a guaranteed client does not fulfill its obligations to third parties, the Bank will pay, then these operations represent the same exposure to credit risk as a common loan.

 

Letters of credit are commitments documented by the Bank on behalf of the client that are guaranteed by the shipped goods to which they relate and, therefore, have less risk than direct indebtedness. The Bank guarantee corresponds to contingent commitments that become effective only if the client does not comply with the performance of engaged works.

 

Loans commitments to grant loans, the Bank is exposed to losses that arise from unused balances. The Bank monitors the maturity of credit lines because generally long-term commitments have a higher credit risk than short-term commitments.

 

Impairment assessment

 

a.Definition of default and cure

 

The Bank considers a financial instrument defaulted and therefore Stage 3 for ECL calculations when the past-due amounts of an exposure exceed materiality thresholds for 90 or more consecutive days.

 

As a part of a qualitative assessment of whether a customer is in default, the Bank also considers a variety of instances that may indicate unlikeliness to pay. Such events include:

 

Restructured operations over 90 days.

 

Pulling effect (defined as the entire outstanding amount on any loan which has an instalment 90 days or more past due)

 

Operations with claimed’s amounts or its reimbursement has been judicially required by the entity

 

The debtor (or any legal entity within the debtor’s group) filing for bankruptcy application/protection

 

A material decreases in the underlying collateral value where the recovery of the loan is expected from the sale of the collateral

 

Internal rating of the borrower indicating default or near default

 

The borrower requesting emergency funding from the Bank

 

The borrower having past due liabilities to public creditors or employees

 

A material decreases in the borrower’s turnover or the loss of a major customer

 

A covenant breach not waived by the Bank

 

Debtor’s listed debt or equity has been suspended at the primary exchange because of rumors or facts about financial difficulties

 

Operations that not meet the conditions of Default must stay in probation period for 92 days, after that will be cured.

 

b.Internal rating and PD estimation

 

The Bank’s Credit Risk Department operates its internal rating models. The models incorporate both qualitative and quantitative information and, in addition to information specific to the borrower utilize supplemental external information that could affect the borrower’s behavior. The internal credit grades are assigned based on the internal scoring policy, PDs are then adjusted for IFRS 9 ECL calculations to incorporate forward looking information and the IFRS 9 Stage classification of the exposure

 

F-144

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

The following table shows quality assets and its related provision, based on our internal scoring policy as of December 31, 2023 and 2022:

 

December 31, 2023

Corporate loans

Corporate

Portfolio

  Stage 1  Stage 2  Stage 3 

Total

Corporate

  Percentage  Stage 1  Stage 2  Stage 3  Total ECL Allowance (*)  Percentage
   MCh$  MCh$  MCh$  MCh$  %  MCh$  MCh$  MCh$  MCh$  %
A1   28,006    
-
    
-
    28,006    0.07%   3    
-
    
-
    3    0.00%
A2   785,654    
-
    
-
    785,654    1.93%   452    
-
    
-
    452    0.04%
A3   2,803,228    29,491    
-
    2,832,719    6.94%   1,982    138    
-
    2,120    0.18%
A4   2,482,922    12,265    
-
    2,495,187    6.11%   2,474    60    
-
    2,534    0.22%
A5   2,732,502    47,927    765    2,781,194    6.81%   5,825    668    62    6,555    0.57%
A6   2,055,756    106,770    
-
    2,162,526    5.30%   8,905    2,227    
-
    11,132    0.97%
B1   331,242    285,756    106    617,104    1.51%   3,787    11,137    58    14,982    1.30%
B2   23,222    165,717    1,201    190,140    0.48%   242    7,717    289    8,248    0.72%
B3   
-
    98,961    5,618    104,579    0.27%   
-
    4,990    2,135    7,125    0.62%
B4   
-
    64,864    32,177    97,041    0.24%   
-
    3,682    8,656    12,338    1.07%
C1   
-
    36,299    178,279    214,578    0.53%   
-
    3,104    59,363    62,467    5.43%
C2   
-
    8,595    77,832    86,427    0.22%   
-
    733    25,793    26,526    2.31%
C3   
-
    4,612    99,892    104,504    0.26%   
-
    550    35,077    35,627    3.10%
C4   
-
    2,385    104,054    106,439    0.26%   
-
    311    45,025    45,336    3.94%
C5   
-
    1,182    110,548    111,730    0.27%   
-
    191    70,909    71,100    6.18%
C6   
-
    1,940    112,428    114,368    0.28%   
-
    206    95,689    95,895    8.33%
Subtotal   11,242,532    866,764    722,900    12,832,196    31.44%   23,670    35,714    343,056    401,229    35.00%
                                                   
   Other loans
   Stage 1  Stage 2  Stage 3  Total Other loans  Percentage  Stage 1  Stage 2  Stage 3  Total ECL Allowance  Percentage
   MCh$  MCh$  MCh$  MCh$  %  MCh$  MCh$  MCh$  MCh$  %
Other Commercial   4,375,334    486,303    446,264    5,307,901    13.01%   37,913    31,921    187,322    257,156    22.36%
Mortgage   14,635,723    1,713,185    724,531    17,073,439    41.83%   8,651    53,371    154,111    216,133    18.79%
Consumer   4,512,156    790,276    295,918    5,598,350    13.72%   57,429    83,897    132,936    274,262    23.85%
Subtotal   23,523,213    2,989,764    1,466,713    27,979,690    68.56%   103,993    169,189    474,369    747,551    65.00%
Total   34,765,745    3,856,528    2,189,613    40,811,886    100.00%   127,663    204,903    817,425    1,149,991    100.00%

 

(*)Include MCh$155,903 of ECL allowance calculated on an Individual basis.

 

F-145

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

December 31, 2022

Corporate loans

Corporate

Portfolio

  Stage 1  Stage 2  Stage 3 

Total

Corporate

  Percentage  Stage 1  Stage 2  Stage 3  Total ECL Allowance (*)  Percentage
   MCh$  MCh$  MCh$  MCh$  %  MCh$  MCh$  MCh$  MCh$  %
A1   40,121    
-
    
-
    40,121    0.10%   1    
-
    
-
    1    0.00%
A2   835,187    
-
    
-
    835,187    2.16%   472    
-
    
-
    472    0.04%
A3   2,362,324    36    
-
    2,362,360    6.10%   3,476    8    
-
    3,484    0.30%
A4   2,780,646    8    
-
    2,780,654    7.18%   5,761    
-
    
-
    5,761    0.50%
A5   2,811,300    13,132    792    2,825,224    7.29%   10,243    360    60    10,663    0.92%
A6   2,089,194    51,671    819    2,141,684    5.53%   18,766    2,226    98    21,090    1.83%
B1   
-
    736,674    2,627    739,301    1.91%   
-
    28,346    473    28,819    2.50%
B2   
-
    190,204    1,389    191,593    0.50%   
-
    12,895    195    13,090    1.14%
B3   
-
    71,873    3,129    75,002    0.20%   
-
    5,674    980    6,654    0.58%
B4   
-
    73,231    31,587    104,818    0.27%   
-
    6,210    8,420    14,630    1.27%
C1   
-
    34,141    164,778    198,919    0.51%   
-
    3,258    56,354    59,612    5.17%
C2   
-
    9,426    104,526    113,952    0.30%   
-
    502    26,992    27,494    2.38%
C3   
-
    1,518    93,311    94,829    0.24%   
-
    162    27,563    27,725    2.40%
C4   
-
    5,490    114,090    119,580    0.31%   
-
    693    49,572    50,265    4.36%
C5   
-
    3,414    81,321    84,735    0.22%   
-
    463    49,095    49,558    4.30%
C6   
-
    1,777    84,999    86,776    0.22%   
-
    297    65,960    66,257    5.74%
Subtotal   10,918,772    1,192,595    683,368    12,794,735    33.04%   38,719    61,094    285,762    385,575    33.43%
                                                   
   Other loans
   Stage 1  Stage 2  Stage 3  Total other loans  Percentage  Stage 1  Stage 2  Stage 3  Total ECL Allowance  Percentage
   MCh$  MCh$  MCh$  MCh$  %  MCh$  MCh$  MCh$  MCh$  %

Other

Commercial

   4,258,677    229,571    434,597    4,922,845    12.71%   44,535    30,262    201,195    275,992    23.93%
Mortgage   14,672,080    367,467    689,462    15,729,009    40.61%   19,388    10,462    132,906    162,756    14.11%
Consumer   4,826,096    217,866    238,850    5,282,812    13.64%   94,203    73,973    160,768    328,944    28.52%
Subtotal   23,756,853    814,904    1,362,909    25,934,666    66.96%   158,126    114,697    494,869    767,692    66.57%
Total   34,675,625    2,007,499    2,046,277    38,729,401    
100,00
%   196,845    175,791    780,631    1,153,267    100.00%

 

(*)Include MCh$105,837 of ECL allowance calculated on an Individual basis.

 

F-146

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

In relation to the credit quality of the investment portfolio, local regulations establish that banks are able to hold only local and foreign fixed–income securities except in certain cases. Additionally, Banco Santander-Chile has internal policies to ensure that only securities approved by the Market Risk department, which are stated in the documents “APS” – Products and underlying Approval, are acquired. The Credit Risk Department sets the exposure limits to those approved APS’s. The APS is updated on daily basis. As of December 31, 2023, 99% our total investment portfolio corresponds to securities issued by the Chilean Central Bank, Chilean Treasury and US Treasury notes.

 

c.Exposure at default

 

The exposure at default (EAD) represents the gross carrying amount of the financial instruments subject to the impairment calculation, addressing both the client’s ability to increase its exposure while approaching default and potential early repayments too.

 

To calculate the EAD for a Stage 1 loan, the Bank assesses the possible default events within 12 months for the calculation of the 12mECL. However, if a Stage 1 loan that is expected to default in the 12 months from the balance sheet date and is also expected to cure and subsequently default again, then all linked default events are taken into account. For Stage 2, Stage 3 the exposure at default is considered for events over the lifetime of the instruments.

 

d.Loss given default

 

The credit risk assessment is based on a standardized LGD assessment framework that results in a certain LGD rate. These LGD rates take into account the expected EAD in comparison to the amount expected to be recovered or realized from any collateral held.

 

The Bank segments its retail lending products into smaller homogeneous portfolios, based on key characteristics that are relevant to the estimation of future cash flows. The applied data is based on historically collected loss data and involves a wider set of transaction characteristics (i.e., product type, wider range of collateral types) as well as borrower characteristics.

 

Further recent data and forward-looking economic scenarios are used in order to determine the IFRS 9 LGD rate for each group of financial instruments. Under IFRS 9, LGD rates are estimated for the Stage 1, Stage 2, Stage 3 IFRS 9 segment of each asset class. The inputs for these LGD rates are estimated and, where possible, calibrated through back testing against recent recoveries. These are repeated for each economic scenario as appropriate.

 

e.Significant increase in credit risk (SICR)

 

The Bank continuously monitors all assets subject to ECLs. In order to determine whether an instrument or a portfolio of instruments is subject to 12-month ECL or Lifetime ECL, the Bank assesses whether there has been a significant increase in credit risk since initial recognition.

 

The Bank also applies a secondary qualitative method for triggering a significant increase in credit risk for an asset, such as moving a customer/facility to the watch list (Special vigilance). The Bank may also consider that events explained in letter a) above are a significant increase in credit risk as opposed to a default. Regardless of the change in credit grades, if contractual payments are more than 30 days past due, the credit risk is deemed to have increased significantly since initial recognition.

 

When estimating ECLs on groups of similar assets, the Bank applies the same principles for assessing whether there has been a significant increase in credit risk since initial recognition.

 

Quantitative criteria for SICR Stage 2:

 

The quantitative criteria are used to identify where an exposure has increased in credit risk and it is applied based on whether an increase in the lifetime PD since the recognition date exceeds the threshold set in absolute terms. The following formula is used to determine such threshold:

 

Threshold = Lifetime PD (at reporting date) – Lifetime PD (at origination)

 

F-147

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

Other commercial  Corporate loans
Mortgages  Other loans 

Revolving

(Credit cards)

  SME  SME  Middle market  Corporate and
Investment Banking
 28.41%   36.05%   11.28%   36.05%   19.60%   13.26%  Santander Group criteria

 

There is also a relative threshold of 100% of all portfolios with the exception of the Corporate and Investment Banking Portfolio.

 

The criteria exposed above were applied for most of the year, however, in December 2023, the threshold of significant increase in credit risk (SICR) was updated, according to the Bank’s new definition of default, generating a decrease of ECL allowance amount of MCh$ 863 and a decrease of MCh$ 31,906 in EAD in Stage 2. The new criteria are exposed below:

 

Other commercial  Corporate loans
Mortgages  Other loans 

Revolving

(Credit cards)

  SME  SME  Middle market  Corporate and
Investment Banking
 28.19%   49.32%   16.91%   49.32%   18.50%   16.36%  Santander Group criteria

 

In December, the Bank has performed a recalibration of the Significant Increase in Credit Risk (SICR) process, which covers the classification of contracts in Stages 1 and 2, moreover the Bank has implement both type of thresholds (absolute and relative) for SICR assessment, using OR criteria (before was based on AND criteria). This recalibration was implemented at the end of December 2023. The impact of the adjustment above descrived increase ECL allowance for an amount of MCh$ 22,175 and increase EAD in Stage 2 for an amount of MCh$ 1,723,190.

 

Qualitative criteria for SICR Stage 2:

 

The qualitative criteria are based on the existence of evidence that leads to an automatic classification of financial instruments in stage 2, mainly 30 days overdue and restructured. Thresholds of SICR are calibrated based on the average ECL of exposures that exceed materiality threshold for 30 days or more consecutive days or with a level of credit risk considered to be “significant”.

 

Other commercial  Corporate loans
Mortgages  Other loans 

Revolving

(Credit cards)

  SME  SME  Middle market  Corporate and Investment Banking
Irregular portfolio > 30 days  Irregular portfolio > 30 days  Irregular portfolio > 30 days  Irregular portfolio > 30 days  Irregular portfolio > 30 days  Irregular portfolio > 30 days  Irregular portfolio > 30 days
Restructured  marked for monitoring  Restructured  marked for monitoring  Restructured  marked for monitoring  Restructured  marked for monitoring  Restructured  marked for monitoring  Restructured  marked for monitoring  Restructured  marked for monitoring
            Clients considered to be substandard or in incompliance (pre-legal action)  Clients considered to be substandard or in incompliance (pre-legal action)  Clients considered to be substandard or in incompliance (pre-legal action)

 

These thresholds are defined by the Model Committee and the Integral Risk Committee and are evaluated annually with updates made depending on impacts and definitions of the risk models associated to each portfolio.

 

f.Expected credit losses measurement

 

Expected credit losses are a probability-weighted estimate of credit losses over the expected life of the financial instrument.  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. Because expected credit losses consider the amount and timing of payments, a credit loss arises even if the entity expects to be paid in full but later than when contractually due.

 

F-148

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

ECL allowance calculated on an individual basis

 

For financial assets, a credit loss is the present value of the difference between: the contractual cash flows that are due under the contract; and the cash flows that the Bank expects to receive. For undrawn loan commitments, a credit loss is the present value of the difference between: the contractual cash flows that are due if the holder of the loan commitment draws down the loan; and the cash flows that the Bank expects to receive if the loan is drawn down.

 

For financial assets that are credit-impaired at the reporting date, and in accordance with our internal procedures, the Bank calculates allowance for expected credit losses under the “Discounted Cash Flow Methodology” when the financial asset is classified in stage 3, with a PD equal to 100% and is individually significant. In this instance, the Bank measures the expected credit losses as the difference between the asset’s gross carrying amount and the present value of estimated future cash flows discounted at the financial asset’s original effective interest rate. Any adjustment is recognised in profit or loss as an impairment gain or loss.

 

The allowances determined under a “Discounted Cash Flow Methodology” must take into account the financial information of the debtor, including available business strategies, as well as collateral associated with that debtor. The recovery analysis includes the following scenarios:

 

-Recovery of a possible sale of collateral.

 

-Recovery on the basis of common commercial activities (commercial plan).

 

The following table shows the allowance and exposure at default (EAD) of the loans that meet the conditions:

 

   2023  2022
   MCh$  MCh$
Loans and account receivable   347,477    308,586 
Allowance for ECL – discounted cash flow methodology   155,903    105,837 

 

As of December 31, 2023, the expected credit losses related to corporate commercial loans includes MCh$155,903 measured from cash flow discounted methodology (MCh$105,837 in 2022).

 

ECL allowance calculated on a collective basis

 

Commercial loans (except for those described within the “ECL allowance calculated on an Individual basis” description aforementioned), mortgage loans and consumer loans are grouped and assessed on a collective basis by using a credit loss allowance model. The estimation of the collective basis expected credit loss allowance considers qualitative and quantitative information that may affect changes in credit risk and the development of significant assumptions related to the probabilities of default and loss given default, related to forward looking information, multi-factor analysis such as type of portfolio or transaction and macroeconomic factors.

 

   2023  2022
   MCh$  MCh$
Loans and account receivable (commercial, mortgage and consumer loans)   40,464,409    38,420,815 
Allowance for ECL – collective basis   994,088    1,074,430 

 

As of December 31, 2023, the Bank maintains MCh$93,614 in residual overlays, to cover certain defaulted loans from mortgage and other commercial portfolios.

 

As of December 31, 2023, the Bank has released part of the post-model adjustment (overlay) recorded at the end of 2022 (MCh$ 91,351) due to improvement on the macro economical forward-looking information and scenarios and better behavior on SCIB clients.

 

F-149

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

g.Corporate and other commercial loans

 

In order to meet the objective of recognising lifetime expected credit losses for significant increases in credit risk since initial recognition, it is necessary to group or sub-group financial instruments, even if evidence of such significant increases in credit risk at the individual instrument level is not yet available.

 

Considering to the aforementioned, the Bank evaluates on corporate basis, commercial loans for which prepares individual credit proposals, where it verifies debt servicing capacity (projected cash flow), client’s financial history, evidence of impairment and projections for economic sector. All proposals include an analysis of the client, a rating and a recommendation. For corporations, the evaluation includes subsidiaries and affiliates. Other commercial loans are grouped into other homogeneous portfolios (smaller commercial, mortgages and consumer loans), based on a combination of instrument type, credit risk ratings, collateral type, date of initial recognition, remaining term to maturity, industry and others.

 

During 2023, and as part of the normal review process, the Bank has made minor adjustments to the internal rating models, in order to improve its ability to adequately detect the risk profile of the clients individually evaluated.

 

h.Modified loans

 

When a loan measured at amortised cost has been renegotiated or modified but not derecognised, the Bank assesses whether the transaction should be treated as a modified asset or derecognition. If the transaction does not result in derecognition the Bank must recognise the resulting gains or losses as the difference between the carrying amount of the original loans and modified contractual cash flows discounted using the EIR before modification.

 

If the modification results in derecognition, then the modified asset is a new asset. The following table shows modification that results in deregonition and therefore and new operations:

 

   As of December 31, 2023  As of December 31, 2022
   Stage 1  Stage 2  Stage 3  Total  Stage 1  Stage 2  Stage 3  Total
   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Gross carrying amount   34.765.745    3.856.528    2.189.613    40.811.886    34,675,625    2,007,499    2,046,277    38,729,401 
Modified loans   
-
    739,474    1,026,843    1,766,317    
-
    679,496    799,559    1,479,055 
%   
-
    
19,17
%   
46,90
%   
4,33
%   
-
    33.85%   39.07%   3.82%
                                         
ECL allowance   127,663    204,903    817,425    1,149,991    196,845    175,791    780,631    1,153,267 
Modified loans   
-
    48.419    360.975    409.394    
-
    60,584    325,650    386,234 
%   
-
    
23,63
%   
44,16
%   
35,60
%   
-
    34.46%   41.72%   33.49%

 

i.Macro economical forward-looking information and scenarios

 

The annual growth forecasts for the most relevant macroeconomic variables for each of our scenarios mainly used during 2023 are as follows:

 

   Average estimates 2023
   Unfavorable
scenario 2
  Unfavorable
scenario 1
  Base
scenario
  Favorable
scenario 1
  Favorable
scenario 2
Chilean Central Bank interest rates   3.7%   4.6%   6.5%   8.4%   9.3%
Unemployment rate   10.4%   9.7%   8.3%   6.9%   6.2%
Housing Price growth   (0.1)%   0.9%   2.9%   5.0%   6.0%
GDP growth   (2.7)%   (1.5)%   0.8%   3.1%   4.3%
Consumer Price Index   3.3%   4.2%   6.0%   7.9%   8.8%

 

F-150

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

However, in November 2023, the Bank updated the macro-economic information and scenarios, resulting in a decrease of ECL allowance of MCh$50,935. The new macroeconomic variables are shown below:

 

   Average estimates 2024
   Unfavorable
scenario 2
  Unfavorable
scenario 1
  Base scenario  Favorable
scenario 1
  Favorable
scenario 2
Chilean Central Bank interest rates   0.85%   2.32%   4.25%   6.18%   7.65%
Unemployment rate   10.03%   8.89%   7.4%   5.91%   4.77%
Housing Price growth   (1.02)%   
0,62
%   2.78%   4.94%   6.59%
GDP growth   (0.8)%   1.1%   3.58%   6.06%   7.97%
Consumer Price Index   1.07%   0.67%   3.00%   5.33%   7.07%

 

The highest probability of occurrence is associated to the base scenario, while the extreme scenarios have a lower probability than the more moderate scenarios.

 

The methodology used for the generation of the local scenarios is based on the corporate methodology and is applied to the loan portfolio with the exception of loans from the Corporate and Investment Banking segment which uses global scenarios as defined by the Santander Group.The probabilities for the scenarios must total 100% and be symmetrical.

 

Local scenario  Global scenario
   Probability
weighting
     Probability
weighting
Favorable scenario 2   10%  Favorable scenario 1   10%
Favorable scenario 1   15%  Base scenario   20%
Base scenario   50%  Unfavorable scenario 1   70%
Unfavorable scenario 1   15%        
Unfavorable scenario 2   10%        

 

The ECL allowance sensibility to future macro-economic conditions is as follows:

 

   As of December 31,
   2023  2022
   MCh$  MCh$
Reported ECL allowance   1,150,116    1,153,593 
Gross carrying amount   40,917,268    38,872,033 
           
Reported ECL Coverage   2.81%   2.97%
           
ECL amount by scenarios          
Favorable scenarios 2   970,411    1,034,417 
Favorable scenarios 1   1,032,708    1,061,899 
Base scenarios   1,104,368    1,138,881 
Unfavorable scenarios 2   1,176,477    1,227,979 
Unfavorable scenarios 2   1,224,340    1,268,948 
           
Coverage ratio by scenarios          
Favorable scenarios 2   2.37%   2.68%
Favorable scenarios 1   2.52%   2.75%
Base scenarios   2.70%   2.95%
Unfavorable scenarios 2   2.88%   3.19%
Unfavorable scenarios 2   2.99%   3.29%

 

F-151

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

j.Analysis of risk concentration

 

The following table shows the risk concentration by industry, and by stage before ECL allowance of loans and account receivable from customers and Interbak loans at amortised cost:

 

   As of December 31,
   2023  2022
   Stage 1  Stage 2  Stage 3  Total  Stage 1  Stage 2  Stage 3  Total
   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Commercial loans                        
Agriculture and livestock   478,676    70,687    74,110    623,473    487,463    103,160    64,524    655,147 
Fruit cultivation   444,600    107,445    94,564    646,609    430,046    148,116    52,404    630,566 
Forest   108,232    10,901    20,390    139,523    134,192    20,162    16,402    170,756 
Fishing   290,978    14,655    7,763    313,396    261,651    13,479    9,268    284,398 
Mining   228,565    5,578    7,656    241,799    241,704    11,590    7,160    260,454 
Oil and natural gas   3,146    199    191    3,536    88,588    1    145    88,734 
                                         
Manufacturing Industry:                                        
Food, beverages and tobacco   301,193    15,366    25,278    341,837    316,574    45,972    14,896    377,442 
Textile, leather and footwear   64,068    5,679    7,345    77,092    65,269    12,102    6,029    83,400 
Wood and furniture   78,856    2,438    6,894    88,188    75,962    4,676    5,327    85,965 
Cellulose, paper and printing   61,702    9,035    4,995    75,732    50,984    9,977    4,864    65,825 
Chemicals and petroleum derivatives   108,011    3,187    1,306    112,504    147,113    5,631    1,185    153,929 
Metallic, non-metallic, machinery, or other   319,322    13,870    21,715    354,907    323,717    15,678    23,511    362,906 
Other manufacturing industries   194,742    19,248    19,392    233,382    201,044    15,245    20,210    236,499 
Electricity, gas, and wáter   910,813    10,497    5,032    926,342    881,647    14,178    5,952    901,777 
Home building   164,118    29,377    23,118    216,613    181,933    33,493    24,103    239,529 
Non-residential construction   472,579    28,395    48,231    549,205    537,110    34,437    57,723    629,270 
Wholesale trade   1,420,083    105,396    163,872    1,689,351    1,368,044    161,570    147,330    1,676,944 
Retail trade, restaurants and hotels   1,501,379    74,975    87,365    1,663,719    1,366,605    86,124    89,924    1,542,653 
Transport and storage   600,729    56,933    54,860    712,522    625,506    90,913    59,141    775,560 
Telecommunications   450,555    16,341    7,261    474,157    334,065    16,522    7,446    358,033 
Financial services   575,666    2,656    912    579,234    374,770    4,166    2,864    381,800 
Real estate services   2,237,404    231,680    154,694    2,623,778    2,221,740    210,683    197,360    2,629,783 
Social services and other community services   4,602,449    518,529    332,220    5,453,198    4,461,722    364,291    300,197    5,126,210 
Subtotal   15,617,866    1,353,067    1,169,164    18,140,097    15,177,449    1,422,166    1,117,965    17,717,580 
Mortgage loans   14,635,723    1,713,185    724,531    17,073,439    14,672,080    367,467    689,462    15,729,009 
Consumer loans   4,512,156    790,276    295,918    5,598,350    4,826,096    217,866    238,850    5,282,812 
Total   34,765,745    3,856,528    2,189,613    40,811,886    34,675,625    2,007,499    2,046,277    38,729,401 

 

F-152

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

The following table shows past due information related to loans and account receivable from customers and Interbak loans at amortised cost, and related ECL allowance:

 

   As of December 31, 2023
   Gross carrying amount  ECL allowance
   Stage 1  Stage 2  Stage 3  TOTAL  Stage 1  Stage 2  Stage 3  TOTAL
   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Interbank loans                                        
Current   68,440    
-
    
-
    68,440    2    
-
    
-
    2 
Commercial loans                                        
Current   15,505,706    1,181,694    362,298    17,049,698    58,096    49,896    119,514    227,506 
1-30 days past due   41,357    102,214    90,367    233,938    3,357    9,164    33,921    46,442 
31-90 days past due   2,363    69,159    166,427    237,949    128    8,575    57,548    66,251 
Over 90 days past due   
-
    
-
    550,072    550,072    
-
    
-
    319,395    319,395 
Mortgage loans                                        
Current   14,612,117    1,285,324    222,874    16,120,315    8,224    34,149    39,964    82,337 
1-30 days past due   19,150    278,114    101,086    398,350    327    11,923    21,627    33,877 
31-90 days past due   4,456    149,747    192,972    347,175    100    7,299    37,612    45,011 
Over 90 days past due   
-
    
-
    207,599    207,599    
-
    
-
    54,908    54,908 
Consumer loans                                        
Current   4,492,189    561,846    61,444    5,115,479    54,038    32,294    26,654    112,986 
1-30 days past due   18,497    133,011    26,198    177,706    3,150    25,139    10,968    39,257 
31-90 days past due   1,470    95,419    94,189    191,078    241    26,464    39,259    65,964 
Over 90 days past due   
-
    
-
    114,087    114,087    
-
    
-
    56,055    56,055 
Total   34,765,745    3,856,528    2,189,613    40,811,886    127,663    204,903    817,425    1,149,991 

 

   As of December 31, 2022
   Gross carrying amount  ECL allowance
   Stage 1  Stage 2  Stage 3  TOTAL  Stage 1  Stage 2  Stage 3  TOTAL
   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Interbank loans                                        
Current   32,991              32,991    1              1 
Commercial loans                                        
Current   15,083,757    1,291,497    480,276    16,855,530    76,241    74,402    156,800    307,443 
1-30 days past due   55,298    80,205    62,775    198,278    6,591    8,311    19,048    33,950 
31-90 days past due   5,403    50,464    145,041    200,908    421    8,643    56,981    66,045 
Over 90 days past due   
-
    
-
    429,873    429,873    
-
    
-
    254,128    254,128 
Mortgage loans                                        
Current   14,559,586    195,691    301,854    15,057,131    17,984    4,699    57,624    80,307 
1-30 days past due   96,080    114,723    84,207    295,010    1,183    3,727    16,900    21,810 
31-90 days past due   16,414    57,053    112,280    185,747    221    2,036    18,605    20,862 
Over 90 days past due   
-
    
-
    191,121    191,121    
-
    
-
    39,777    39,777 
Consumer loans                                        
Current   4,767,906    74,555    60,169    4,902,630    76,215    23,738    44,107    144,060 
1-30 days past due   52,878    66,958    24,898    144,734    17,139    19,003    16,616    52,758 
31-90 days past due   5,312    76,353    62,129    143,794    849    31,232    38,137    70,218 
Over 90 days past due   
-
    
-
    91,654    91,654    
-
    
-
    61,908    61,908 
Total   34,675,625    2,007,499    2,046,277    38,729,401    196,845    175,791    780,631    1,153,267 

 

F-153

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

k.Collateral and other credit enhancement

 

Banco Santander controls the credit risk using collateral in its operations. Each business unit is responsible for credit risk management and formalizes the use of collateral in its lending policies. Guidelines are in place covering the acceptability and valuation of each type of collateral.

 

Banco Santander uses guarantees in order to increase their resilience in the subject to credit risk operation. The guarantees can be used fiduciary, real, legal structures with power mitigation and compensation agreements. The Bank periodically reviews its policy guarantees by technical parameters, normative and also its historical basis, to determine whether the guarantee is legally valid and enforceable.

 

Credit limits are continually monitored and changed in customer behavior function. Thus, the potential loss values represent a fraction of the amount available.

 

Collateral refers to the assets pledged by the customer or a third party to secure the performance of an obligation. The main type of collateral obtained are the following:

 

For securities lending and reverse repurchase transactions, cash or securities

 

For corporate and small business lending, charges over real estate properties, inventory and trade receivables and, in special circumstances, government guarantees

 

For retail lending, mortgages over residential properties

 

The following table show the maximum exposure to credit risk by class of financial asset, associated collateral and the net exposure to credit risk:

 

   As of December 31,
   2023  2022
   Maximum
exposure to
credit risk
  Collateral  Net
exposure
  Associated
ECL
  Maximum
exposure to
credit risk
  Collateral  Net
exposure
  Associated
ECL
   MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$  MCh$
Interbank loans   68,440    3,677    64,763    2    32,991    -    32,991    1 
Commercial loans   18,071,657    9,893,336    8,178,321    659,594    17,684,589    9,945,505    7,739,084    661,566 
Mortgage loans   17,073,439    16,589,333    484,106    216,133    15,729,009    15,358,111    370,898    162,756 
Consumer Loans   5,598,350    586,050    5,012,300    274,262    5,282,812    593,660    4,689,152    328,944 
Contingent loans exposure   2,701,525    378,648    2,322,877    21,105    3,048,383    476,327    2,572,056    44,997 
Total   43,513,411    27,451,044    16,062,367    1,171,096    41,777,784    26,373,603    15,404,181    1,198,264 

 

One very important example of financial collateral is the collateral agreement. Collateral agreements comprise a set of highly liquid instruments with a certain economic value that are deposited or transferred by a counterparty in favor of another party in order to guarantee or reduce any counterparty credit risk that might arise from the portfolios of derivative transactions between the parties in which there is exposure to risk.

 

Collateral agreements vary in nature but, whichever the specific form of collateralization may be, the ultimate aim, as with the netting technique, is to reduce counterparty risk.

 

Transactions subject to a collateral agreement are assessed periodically (normally on a daily basis). The agreed-upon parameters defined in the agreement are applied to the net balance arising from these assessments, from which the collateral amount (normally cash or securities) payable to or receivable from the counterparty is obtained.

 

For real estate collateral periodic re-appraisal processes are in place, based on the actual market values for the different types of real estate, which meet all the requirements established by the regulator.

 

F-154

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

Specifically, mortgage loans are secured by a real property mortgage, and threshold mitigate counterparty credit risk of derivative instruments.

 

For the ECL allowance calculated on an Individual basis, the collaterals at fair value, are use for mitigating the loan amount and obtain the exposure. While for ECL allowance calculated on a collective basis LTV is used (defined as the Loan amount divided by value of collateral).

 

Personal guarantees and credit derivatives

 

Personal guarantees are guarantees that make a third party liable for another party’s obligations to the Bank. They include, for example, security deposits and standby letters of credit. Only guarantees provided by third parties that meet the minimum requirements established by the supervisor can be recognised for capital calculation purposes.

 

Credit derivatives are financial instruments whose main purpose is to hedge credit risk by buying protection from a third party, whereby the Bank transfers the risk of the issuer of the underlying instrument. Credit derivatives are OTC instruments, i.e. they are not traded in organized markets.

 

Credit derivative hedges, mainly credit default swaps, are entered into with leading financial institutions. According to the Bank’s policy when an asset (real state) is repossessed are transferred to assets held for sale at their fair value less cost to sell as non-financial assets at the repossession date (assets received in lieu of payments).

 

Assets Received in Lieu of Payment

 

Assets received or awarded in lieu of payment of loans and accounts receivable from clients are recognised at their fair value (as determined by an independent appraisal). The excess of the outstanding loan balance over the fair value is charged to net income for the period, under “Provision for loan losses”. Any excess of the fair value over the outstanding loan balance, less costs to sell of the collateral, is returned to the client. These assets are subsequently adjusted to their net realizable value less cost to sale (assuming a forced sale).

 

As of December 31, 2023, assets received or awarded in lieu of payment amounted to Ch$42,463 million (gross amount: Ch$42,489 million; allowance: Ch$26 million). As of December 31, 2022, assets received or awarded in lieu of payment amounted to Ch$35,622 million (gross amount: Ch$36,804 million; allowance: Ch$1,182 million).

 

l.Maximum exposure to credit risk

 

Financial assets and off-balance sheet commitments

 

For financial assets recognised in the Consolidated Statements of Financial Position, maximum credit risk exposure equals their carrying value. Below is the distribution by financial asset and off-balance sheet commitments of the Bank’s maximum exposure to credit risk as of December 31, 2023 and 2022, without deduction of collateral, security interests or credit improvements received:

 

F-155

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

       As of December 31, 
       2023   2022 
       Amount of exposure   Amount of exposure 
   Note   MCh$   MCh$ 
Deposits in banks   4    2,273,282    1,982,942 
Cash items in process of collection   4    812,524    843,816 
Financial assets for trading at FVTPL   5           
Financial derivative contracts        10,119,486    11,672,960 
Financial assets held for trading        98,308    154,046 
Financial assets at FVOCI   6           
Debt financial instruments        4,536,025    5,800,733 
Other financial instruments        105,257    142,306 
Financial derivative contracts for hedge accounting   7    605,529    477,762 
Financial assets at amortised cost   8           
Debt financial instruments        8,176,895    4,867,591 
Interbank loans        68,438    32,990 
Loans and account receivable at amortised cost /        39,593,457    37,543,144 
Off-balance commitments:               
Letters of credit issued        262,496    255,522 
Foreign letters of credit confirmed        1,641,510    1,476,599 
Performance guarantees        9,490,141    8,974,077 
Available credit lines        494,104    924,173 
Personal guarantees        813    1,617 
Other irrevocable credit commitments        313,505    313,345 
Total        70,041,770    75,463,623 

 

Foreign derivative contracts

 

As of December 31, 2023, the Bank’s foreign exposure -including counterparty risk in the derivative instruments’ portfolio- was USD 3 million or 25% of its assets. In the table below, exposure to derivative instruments is calculated by using the equivalent credit risk; which equals the replacement carrying amount plus the maximum potential value, considering the cash collateral that minimizes exposure.

 

Below, there are additional details regarding our exposure for those countries classified above 1 and represents our majority of exposure to categories other than 1. As of December 31, 2023, considering fair value of derivative instruments.

 

Country   Classification     Derivative Instruments
(adjusted to market)
    Deposits     Loans     Financial
investments
    Total
Exposure
 
          US$ millions  
Hong Kong         2      
   -
        7      
 -
     
   -
      7  
Italy     2      
-
      1      
-
     
-
      1  
Mexico     3       3      
-
     
-
     
-
      3  
China     2      
-
     
-
      1      
-
      1  
Total             3       8       1      
-
      12  

 

F-156

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

Our exposure to the group is as follows:

 

Counterpart  Country  Classification   Derivative
instruments
(market adjusted)
  

Deposits

MUSD

  

Loans

MUSD

  

Financial

Investments

MUSD

  

Exposure

MUSD

 
          US$ millions 
Banco Santander Hong Kong  Hong Kong        2    
  -
    7    
   -
    
    -
    7 
Banco Santander Mexico  Mexico   3    3    
-
    
-
    
-
    3 
Banco Santander EEUU *  EEUU   1    41    700    
-
    
-
    741 
Santander UK PLC  UK   1    
-
    1    
-
    
-
    1 
Banco Santander España  Spain   1    292    46    
-
    
-
    338 

 

*Includes BSCH SA New York and Santander InvestmentSecuries

 

The total amount of this exposure to derivative instruments must be compensated daily with collateral and, therefore, there is no credit exposure.

 

As of December 31, 2023, we had no applicable sovereign exposure, no unfunded exposure, no credit default protection and no current developments.

 

Security interests and credit improvements

 

The maximum exposure to credit risk is reduced in some cases by security interests, credit improvements, and other actions which mitigate the Bank’s exposure. Based on the foregoing, the creation of security interests are a necessary but not a sufficient condition for granting a loan; accordingly, the Bank’s acceptance of risks requires the verification of other variables and parameters, such as the ability to pay or generate funds in order to mitigate the risk being taken on.

 

The procedures used for the valuation of security interests utilize the prevailing market practices, which provide for the use of appraisals for mortgage securities, market prices for stock securities, fair value of the participating interest for investment funds, etc. All security interests received must be instrumented properly and registered on the relevant register, as well as have the approval of legal divisions of the Bank.

 

The risk management model includes assessing the existence of adequate and sufficient guarantees that allow recovering the credit when the debtor’s circumstances prevent them from fulfilling their obligations.

 

The Bank has classification tools that allow it to group the credit quality of transactions or customers. Additionally, the Bank has historical databases that keep this internally generated information to study how this probability varies. Classification tools vary according to the analyzed customer (commercial, consumer, SMEs, etc.).

 

Below is the detail of security interests, collateral, or credit improvements provided to the Bank as of December 31, 2023 and 2022:

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Non-impaired financial assets        
Properties/mortgages   29,279,845    28,012,572 
Investments and others   5,300,893    4,441,058 
Impaired financial assets          
Properties/ mortgages   2,444,084    2,009,968 
Investments and others   293,347    274,296 
Total   37,318,169    34,737,894 

 

F-157

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

Credit risk mitigation techniques

 

The Bank applies various methods of reducing credit risk, depending on the type of customer and product. As we shall see, some of these methods are specific to a particular type of transaction (i.e., real estate guarantees) while others apply to groups of transactions (i.e., netting and collateral arrangements).

 

m.PD scaling

 

A change was made for the Corporate loans (SME and Middle Market portfolio), which consists of replicating the PD escalation used today in the CIB portfolio, for the SME and Middle Market portfolio in Stage 1 and Stage 2.

 

PD scaling allows the annual PD of the last period to be weighted by the residual real months, that is, if:

 

a)If the operation has a residual term of 2 years and is in stage 1, there is no change.

 

b)If the operation has a residual term of 2.5 years and is in stage 2, there will be a benefit for the last period. (6/12)

 

c)If the operation has a residual term of 1 month, regardless of the stage, there will be a benefit (1/12)

 

Liquidity risk

 

Liquidity risk is the risk of incurring losses resulting from the inability to meet payment obligations in a timely manner.

 

Liquidity risk management

 

The Bank’s approach to liquidity management is to ensure-- whenever possible--to have enough liquidity on hand to fulfill its obligations at maturity, in both normal and stressed conditions, without entering into unacceptable debts or risking the Bank’s reputation. The Board establishes limits on the minimal part of available funds close to maturity to fulfill payments as well as over a minimum level of interbank operations and other loan facilities that should be available to cover transfers at unexpected demand levels. This is constantly reviewed by the Assets and liabilities Committee. Additionally, the Bank must comply with the regulation limits established by the FMC for maturity mismatches.

 

The limits establishment is conceived as a dynamic process that responds to risk appetite considered acceptable by the Bank and its entities.The limit system allows knowing at all times the level of exposure in which each entity incurs against liquidity risks. In addition, the Bank includes alert indicators by concentration of: counterparties, type of products and terms, wiith the objective of diversifying the sources of financing and its maturity structure.

 

The Bank monitors liquidity position on a daily basis, determining the future inflows and outflows. Also, at the month-end, stress tests are performed, considering different scenarios in normal market conditions and fluctuation conditions (stress).

 

The Bank have internal liquidity limits that must be met at all times by Financial Management and Treasury. The Market Risk Management calculates and control of internal limits usage as well as verifies their compliance and communicates the status to senior management and the Board of Directors.

 

At the beginning of the year, the limits are proposed by the Market Risk Management, approved in the ALCO Committee and ratified at the highest level.

 

The liquidity limits and early warning indicators and management measures defined internally can be grouped as follows:

 

Limits associated with concentration and mismatches of cash flows and liquidity of the Bank’s operations.

 

Liquidity Management Tools, which is a Structural liquidity or Financing Chart, whose objective is to determine the Bank’s structural liquidity position and allow active management, is an essential mechanism to ensure permanently the assets’s financing in optimal conditions.

 

Early warning indicators associated with risks concentration and used as detection and anticipation tool of potential liquidity stress situations and, if necessary, the activation of the Liquidity Contingency Plan.

 

F-158

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

The Market Risk Management establishes and updates the Liquidity Management Policy (PAL). The review and update is performed once a year. However, at any time it could be updated upon request, if any of the areas involved by the PAL have identified a required modification. The PAL is approved by the Board of Directors.

 

The Market Risk Management provides all necessary tools for the statistical analysis required by local liquidity regulations. The validity of the models are reviewed once a year. The conclusions must be approved by the Board of Directors.

 

In normal liquidity periods, the Financial Management Department applies the policies and perform the actions required to comply with internal and regulatory limits. If a situation is identified, even at low level, the Liquidity Crisis Committee applies the necessary actions to face potential liquidity deficits or restrictions, and contingency plans to control emergency situations, along with reporting situations to senior management and the respective committees.

 

Measurement and control of liquidity risk

 

1.Term mismatches subject to regulatory limits

 

The Regulatory Liquidity Ratio measures the mismatches of the inflows and outflows in relation to regulatory capital. In accordance with current regulations, the 30-day mismatch cannot exceed once the regulatory capital of the Bank, both for national and foreign currency, and the 90-day mismatch cannot exceed it twice.

 

2.Monitoring indicators and liquidity ratio subject to regulatory limits

 

An important component for liquidity risk management is High Quality Liquid Assets (ALAC). These are balance sheet assets, mainly financial investments that are not pledged as collateral, with low credit risk, and with a deep secondary market.

 

These assets are divided into three levels in accordance with Basel III standards, with Level 1 assets being the most liquid and Level 3 assets being the least liquid. Level 1 assets are bonds from Chilean Goverment entities, Central Bank bonds and United States Treasury bonds.

 

   As of December 31, 
ALAC  2023   2022 
   MCh$   MCh$ 
Level 1: cash and cash equivalent   1,969,547    1,453,265 
Level 2: fixed income   6,072,282    5,424,452 
Level 2: fixed income   6,240    8,066 
Total   8,048,069    6,885,783 

 

3.Liquidity Coverage Ratio (LCR)

 

The Liquidity Coverage Ratio (LCR) is a measurement of liquid assets over 30-day net outflows. It is used by banks globally, as part of the Basel III standards. The requirements were gradually implemented, reaching 100% in 2022.

 

The objective of the LCR is to promote the short-term resistance of Banks’ liquidity risk profile. The LCR ensures 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, 
Liquidity Coverage Ratio  2023   2022 
  %   % 
LCR   212    175 

 

Banco Santander Chile’s RCL indicator is above the minimum required. This reflects the conservative liquidity policies imposed by the Board of Directors, through the Assets and Liabilities Committee.

 

F-159

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

4.Net Stable Funding Ratio (NSFR)

 

The indicator is required by Basel III and provides a sustainable maturity structure for assets and liabilities, thus the banks maintain a stable funding profile in relation to their activities.

 

The Central Bank and the CMF defined a minimum NSFR level of 60% for 2022, reaching 100% by 2026.

 

   As of December 31, 
Net Stable Funding Ratio  2023   2022 
   %   % 
NSFR   106    116 

 

5.Information on the liquidity situation according to the requirements of the BCCH

 

i.Term mismatches

 

On March 8, 2022, the BCCh published Rules on the Management and measurement of the liquidity position of banking companies that modernize the liquidity regulation, aligning regulatory requirements of the CMF under Basel III implementation process.

 

In accordance with the provision of the BCCh, the liquidity position is measured and controlled through the difference between the cash outflows, related to liabilities and expense accounts, and cash inflows, which are related to asset and income accounts, for a certain term or time band, which is refered as term mismatch.

 

The liquidity policy on an Adjusted Base was presented and approved by the Board of Banco Santander Chile. Term mismatches are calculated severally for local currency and foreign currency.

 

Term mismatches will be made on the following time bands:

 

-First time band: up to 7 days, inclusive

 

-Second time band: from 8 days to 15 days, inclusive

 

-Third time band: from 16 days to 30 days, inclusive

 

-Fourth time band: from 31 days to 90 days, inclusive

 

   As of December 31, 2023 
   Individual   Consolidated 
   Up to 7
days
   Up to 15
days
   Up to 30
days
   Up to 7
days
   Up to 15
days
   Up to 30
days
 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Cash flow receivable (assets) and income   7,874,553    3,217,485    2,017,597    7,991,785    3,230,081    2,009,451 
Cash flow payable (liabilities) and expenses   10,475,218    2,119,787    2,498,713    10,411,396    2,119,787    2,498,985 
Mismatch   (2,600,665)   1,097,698    (481,116)   (2,419,611)   1,110,294    (489,534)
                               
Mismatch affected by limits             (1,984,083)             (1,798,851)
Limits:                              
1 time capital             4,367,159              4,491,893 
Margin available             2,383,076              2,693,042 
% used             45%             40%

 

F-160

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

   As of December 31, 2022 
   Individual   Consolidated 
   Up to 7
days
   Up to 15
days
   Up to 30
days
   Up to 7
days
   Up to 15
days
   Up to 30
days
 
   MCh$   MCh$   MCh$   MCh$   MCh$   MCh$ 
Cash flow receivable (assets) and income   9,123,887    1,805,516    3,552,792    9,269,188    1,804,580    3,514,336 
Cash flow payable (liabilities) and expenses   9,295,580    1,855,664    2,702,150    9,320,125    1,855,664    2,707,135 
Mismatch   (171,693)   (50,148)   850,642    (50,937)   (51,084)   807,201 
                               
Mismatch affected by limits             628,801              705,180 
Limits:                              
1 time capital             4,128,808              4,238,372 
Margin available             4,757,609              4,943,552 
% used             15%             17%

 

ii.Composition of financing sources

 

The main sources of financing with third parties are the following:

 

   As of December 31, 
Main sources of financing  2023   2022 
   MCh$   MCh$ 
Deposits and other demand obligations   13,537,826    14,086,226 
Time deposits   16,137,942    12,978,790 
Bank obligations   10,366,499    8,864,765 
Debt instruments issued and regulatory capital   8,001,045    9,490,009 
Total   48,043,312    45,419,790 

 

The BCCh has authority to require banks to maintain reserves of up to 40% on average for demand deposits and up to 20% for time deposits to implement monetary measures. Also, if the aggregate amount of demand deposits exceeds 2.5 times the amount of a bank’s regulatory capital, it must maintain a 100% “technical reserve” in Central Bank bonds and notes.

 

As of December 31, 2023 and 2022, the Central Bank has required to the Bank to maintain a technical reserve of $0 million for both periods.

 

The volume and composition of liquid assets are presented above. The liquidity coverage ratio is presented above.

 

6.Maturity of financial assets and liabilities

 

The maturity of financial assets and liabilities, and other commercial commitments is disclore in Note 23.

 

The inherent liquidity management of derivatives and non-derivatives financial liabilities, employ different levers that allow to keep limited liquidity risk according to the Bank’s defined profile and using the available liquidity efficiently. For this reason, the Bank hold a high level of liquid assets along with a daily monitoring of the short-term expected income and expenses level, avoiding a high concentrations of maturities. Moreover, a solid diversified financing matrix is maintained both among the different types of products and types of clients.

 

Operational risk

 

The Bank defines operational risk as the risk of losses arising from defects or failures in its internal processes, people, systems or external events, thus covering risk categories such as operational incidents, cloud computing, cybersecurity, business continuity, outsourcing of strategic and non-strategic services.

 

F-161

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

Operational risk is inherent to all products, activities, processes and systems and is generated in all business and support areas. For this reason, all employees are responsible for managing and controlling the operational risks generated in their sphere of action. The Bank’s goal in terms of operational risk management and control is focused on identifying, evaluating and mitigating sources of risk, regardless of whether they have materialized or not. The analysis of operational risk exposure contributes to the establishment of risk management priorities.

 

Operational risk management

 

The operational risk model regulates the necessary elements for adequate management and control of operational risk, aligned with advanced regulatory standards and best management practices, and includes the following phases:

 

strategy and planning.

 

identification, assessment and monitoring of risks and internal controls.

 

implementation and monitoring of mitigation measures.

 

availability of information, adequate reports and escalation of relevant issues.

 

The main operational risk tools used are:

 

-Internal events database. Record of operational risk events with financial impact (all losses are recorded, regardless of their amount) or non-financial (such as regulatory impact on customers and/or services). This information:

 

»allows root cause analysis.

 

»increases awareness of risks.

 

»allows escalation of relevant operational risk events to the senior management of the Risk division with maximum immediacy

 

»facilitates regulatory reporting.

 

-Self-assessment of operational risks and controls. Qualitative process that evaluates the main operational risks associated with each function, the situation of the control environment and its assignment to the different functions within the Bank, through the criteria and experience of a group of experts from each function.

 

The objective is to identify and assess material operational risks that could prevent business or support units from achieving their objectives. Once the risks and the internal controls that mitigate them have been evaluated, mitigation measures are identified in the event that the risk levels are above the tolerable level.

 

F-162

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

This process integrates specific operational risk reviews that allow a cross-sectional identification of risks, especially technological risks, fraud, supplier risk and factors that could lead to other operational risks, as well as specific regulatory non-compliance.

 

-External events database. Quantitative and qualitative information on external operational risk events. The database allows a detailed and structured analysis of the relevant events that have occurred in the sector, the comparison of the loss profile, and the adequate preparation of the self-assessment exercises and scenario analysis.

 

-Analysis of operational risk scenarios. Its objective is to identify events with a very low probability of occurrence that could generate significant losses for the Bank, as well as to establish adequate mitigation measures, through the evaluation and expert opinion of the business lines and risk managers

 

-Recommendations from internal audit, external audit and regulators. They provide relevant independent information on inherent and residual risk and identify areas for improvement in controls and processes.

 

-A statement establishing that the Bank has the commitment to control and limit non-financial risk events that lead or may lead to financial losses; fraud events, operational and technological incidents; legal and regulatory violations; conduct problems or damage to reputation. Although a certain volume of losses is expected, unexpected high severity losses as a result of control failure are not acceptable.

 

-Capital model: a model that includes the Bank’s risk profile, based mainly on information collected in the internal loss database, external data and scenarios. The main application of the model is to determine the economic capital for operational risk and the estimate of expected and stressed losses, which are used in the operational risk appetite.

 

-Other specific instruments that make it possible additionally analyze and manage operational risk, including the evaluation of new products and services, the management of business continuity plans, the review and update of the perimeter and review processes of the quality of the operational risk programme.

 

The Bank’s operational risk management and reporting system supports operational risk management programmes and tools with a focus on governance, risk, and compliance. It provides information for management and reporting, and contributes to improving decision-making in operational risk management, consolidating information, simplifying the process and avoiding duplication.

 

Operational continuity plan

 

The digital transformation is revolutionizing the way banks operate, presenting new business opportunities, but at the same time a wide range of emerging risks, such as technological risks, cyber risks and an increasing dependence on suppliers, which increases exposure to events that may affect the provision of services to our customers.

 

The Bank is highly committed to guaranteeing a robust control environment in accordance with the best industry standards, which allows us to reinforce our operational resistance against potential disruption events and thus ensure the adequate provision of services to our clients and stability of the system.

 

F-163

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

A main pillars is a business continuity management system aimed to guaranteeing the continuity of business processes in the event of a disaster or serious incident. This process identifies potential impacts that threaten the entity and its supplies, and provides the correct protocols and governance that ensure effective response capability. Its main objectives are:

 

-Protect the integrity of people in a contingency situation.

 

-Guarantee that the main functions are performed and minimize the impact over clients’services in case of contingency.

 

-Satisfy the Bank’s obligations with its employees, clients, shareholders and other interest groups.

 

-Comply with regulatory obligations and requirements.

 

-Minimize the potential economic losses for the entity and its impact on the business.

 

-Protect the brand image, credibility and trust in the entity.

 

-Reduce the operational effects by providing effective procedures, priorities and strategy for the recovery and restoration of business operations after a contingency.

 

-Contribute to stabilizing the financial system.

 

The pandemic challenged the frameworks and strategies of the business continuity plans and, although some of the protocols had to be adapted, this crisis has shown that the Bank has a robust business continuity management system.

 

Relevant mitigation measures

 

The Bank, through internal operational risk management tools and other external sources of information, implements and monitors mitigation measures related to the main sources of risk.

 

The transformation and digitalization of the business entail new risks and threats, such as the increase in payment fraud and origination fraud (credits). To mitigate these risks, we have improved control mechanisms and designed new products.

 

The use of reinforced authentication processes in the customer registration process and reinforcement of anti-fraud alerts in origination are increasingly widespread resources to mitigate the risk of fraud.

 

In the case of cards, the use of chip cards and numeric code in shops and ATMs has become widespread, two-step authentication with one-time passwords (dynamic verification passwords), security reinforcement in ATMs by incorporating physical protection and anti-skimming elements, as well as improvements in the logical security of the devices.

 

In the case of office banking (online services), verification of online banking transactions with a second security factor of one-time passwords, application of specific protection measures for mobile banking, such as the identification and registration of customer devices, monitoring of the security of the e-banking platform to avoid attacks on the systems, among others.

 

Cybersecurity

 

It is expected that cybersecurity threats will increase and the financial sector will be one of the main targets. This, together with the greater dependence on digital systems, makes cybersecurity one of the main non-financial risks of the business. For this reason, our objective is to make the Bank a cyber-resilient organization that can resist, detect and respond quickly to cyber-attacks, with constant evolution and improvement of its defenses.

 

F-164

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

Outsourcing of services

 

Continuing with our digitization strategy, the Bank’s objetive is offer the best solutions and products on the market to our clients. This means an increase in the services provided by third parties and the intensive use of new technologies such as cloud services. Due to the increase in cyber risks and regulatory requirements, we have updated and strengthened the supplier management framework, the internal control framework and the risk culture to ensure that the risks associated with contracting third parties are adequately assessed and managed.

 

The Bank has identified those suppliers that could present a higher level of exposure for our operations and for the services provided to our clients and has reinforced monitoring of these suppliers to ensure that:

 

They present an adequate control environment, depending on the level of risk of the service they provide.

 

There are business continuity plans that guarantee service delivery in case of disruption events.

 

They have controls aimed to guaranteeing the protection of sensitive information processed during the provision of the service.

 

Contracts and agreements with third parties include the necessary clauses to protect the interests of the Bank and our customers, while providing coverage for current legal obligations.

 

There are exit strategies, which include service reversion or migration plans, in the case of services with a strong impact on business continuity and high substitution complexity.

 

Insurance

 

In order to respond to the operational risk and other risks generated in the Bank's own operations, material damage insurance, general civil liability, fraud, expenses derived from cybersecurity breaches, third-party claims against executives, among others, have been contracted.

 

Exposure to net loss, gross loss and recovery of gross loss due to operational risk event

 

   As of December 31, 
   2023   2022 
   MCh$   MCh$ 
Expenses for the gross loss period due to operational risk events        
Internal fraud   1,367    91 
External fraud   7,202    8,513 
Labor Practices and Business Safety   6,887    8,095 
Clients, products and business practices   950    789 
Damage to physical assets   267    221 
Business interruption and system failures   964    981 
Process execution, delivery and management   7,303    3,624 
Subtotal   24,940    22,314 
Recoveries of expenses in the period due to operational risk events          
Internal fraud   -    - 
External fraud   (5,810)   (2,194)
Labor Practices and Business Safety   (1,276)   (1,391)
Clients, products and business practices   (189)   (673)
Damage to physical assets   (12)   - 
Business interruption and system failures   (800)   (2)
Process execution, delivery and management   (2,885)   (809)
Subtotal   (10,972)   (5,069)
           
Net loss from operational risk events   13,968    17,245 

 

F-165

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

Capital risk

 

The Bank defines capital risk as the risk that the Bank or any of its companies have an insufficient capital quantity and/or quality to meet the minimum regulatory requirements to operate as a bank; respond to market expectations regarding its solvency; and support the business growth and any strategic demand that may arise from strategic plan. The objectives includes:

 

Satisfied internal capital and capital adequacy objectives.

 

Adhere to regulatory requirements.

 

Align the Bank's strategic plan with the capital expectations of external agents (rating agencies, shareholders and investors, clients, supervisors, etc.)

 

Support business growth and any strategic opportunities that may arise.

 

The Bank has a capital adequacy position that surpasses the levels required by regulations.

 

Capital management seeks to optimize value creation at the Bank an at its different business segment. The Bank continuously evaluates it risk-return ratios through its basic capital, effective net equity, economic capital and return on equity. The Bank is conducting its internal process based on the FMC standards which are based on Basel Capital Accord (Basel III). Economic capital is the capital required to support all the risk of the business activity with an appropriate solvency level.

 

Capital is managed in accordance with the risk environment, Chile's economic performance and the economic cycle.

 

The respective Committee may amend our current capital policies to address changes in the aforementioned risk environment.

 

Capital risk management

 

The Bank has an Executive Capital Committee which is in charge of supervising, authorising and assessing all aspects related to capital and solvency. The Board of Directors has delegated to ALCO the knowledge and evaluation of the level of capital and profitability in accordance with the Bank's strategy. The CIR monitors and is responsible for the limits of primary and secondary metrics based on risk appetite.

 

Capital management is based on a Capital Framework whose objective is to ensure that the level of capital, structure and composition are adequate at any time considering the Bank's risk profile and under different scenarios, guaranteeing compliance with both the minimum requirements regulations such as risk appetite and the Recovery Plan, and that are in line with the interests of all stakeholders and support the growth strategy defined by the Bank.

 

The capital model defines the functional and governance aspects regarding the activities of capital planning, budget execution and monitoring, capital adequacy analysis, capital measurement and Reporting and disclosure of information related to capital. This model covers the main capital management activities:

 

1.Establish the Bank's solvency and capital contribution objectives aligned with the minimum regulatory requirements and with internal policies, to guarantee a solid level of capital, consistent with the Bank's risk profile, and an efficient use of capital in order to maximize shareholder value.

 

2.Capital plan development to achieve the strategic plan’s objective.

 

3.Capital adequacy assessment to ensure that the capital plan is consistent with the Bank's risk profile and its risk appetite (also stress scenarios).

 

4.Capital budget development as part of the Bank's budget process.

 

5.Monitoring and controling budget execution and action plans’ elaboration to correct any digression from the budget.

 

6.Capital metrics calculation.

 

7.Internal capital reports as well as supervisory authorities’ reports and market reports.

 

Additionally, the Bank has developed the necessary policies to contribute with management and compliance with capital management strategies and objectives, including: Capital adequacy policy, Capital Planning Policy, Policy for managing impairment situations Capital, Capital Monitoring Policy and Dividend Policy and Basila III implementation.

 

F-166

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

BASEL III implementation

 

In January 2019, a new version of the General Banking Law (LGB) was published. The most relevant change is the adoption of the capital levels established in the Basel III standards. During 2020, the final versions of the regulations for new capital models for Chilean banks were published.

 

According to the new General Banking Law (updated through Law N°21,130), the minimum capital requirements have increased in terms of quantity and quality. Total regulatory capital remains at 8% of risk-weighted assets, but includes credit, market and operational risk. The minimum Tier 1 capital increased from 4.5% to 6% of risk-weighted assets, of which up to 1.5% may be Additional Tier 1 (AT1), either in the form of preferred stocks or perpetual bonds, which may be convertible into shares. Tier 2 capital is now set at 2% of risk-weighted assets.

 

 

Additional capital requirements are incorporated through a conservation buffer of 2.5% of risk-weighted assets. In addition, the Chilean Central Bank, prior agreement with the FMC, can establish an additional countercyclical buffer of up to 2.5% of risk-weighted assets. Both buffers must be composed of core capital.

 

In addition, the FMC was empowered, with the favorable agreement of the Council of the Chilean Central Bank, to define, through regulations, the new methodologies for calculating assets weighted by credit, market and operational risk; the issuance conditions of AT1 hybrid instruments, the determination and capital charges for local systemically important banks, prudential discounts to regulatory capital and require additional measures, including greater capital, to banks that present deficiencies in the supervisory capital evaluation process (Pillar II).

 

Pillar II aims to ensure that banks maintain a level of capital in accordance with their risk profile, and encourage the development and use of adequate processes for monitoring and managing the risks faced. The banks are responsible for developing an internal evaluation process of their capital adequacy, and supervisors must examine banks' internal strategies and evaluations and early intervene when they are not satisfied with the result of the process. Supervisors may require additional capital to the minimum required, in order to guarantee a sufficient level to face risks, especially in adverse credit cycles.

 

The result is a simplified report with the conclusions of the self-assessment process, which in its first version of 2021 only included credit risk, Pillar I risks report for 2022 and a full report was required since 2023. On January 17, the FMC issued additional capital requirements report according to Pillar II, in which the commission's council resolved not to apply capital requirements to Banco Santander Chile.

 

Pillar III promotes market discipline and financial transparency through the disclosure of significant and timely information, allowing users of the information to know the risk profile of local banking institutions together with their capital structure, thus reducing information asymmetries. The Banks published the first Pillar 3 report in April 2023.

 

The new regulations for risk-weighted assets calculation was effective in December 2021, the Bank worked on the implementation of the regulations through a multidisciplinary group, which performed the required system developments, including report’s implementation designed by the regulator for this purpose.

 

F-167

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

The FMC in a continuous review and implementation of improvements to the Basel III adoption process has issued regulation consutations draft at the end of 2023, which include the following matters:

 

-On November 27, the FMC issued a consultation process related to RAN chapter 21-20 “Market discipline and transparency” and the associated frequently asked questions document, to clarify and provide additional guidelines on how to comply with the aforementioned standard.

 

-On December 12, 2023, the FMC issued a regulation consultation process regarding to RAN, chapter 21-13 “Sufficiency of effective equity banks review”, after regulation review, where highlighted aspect to improve and gaps with international standard. The proposed adjustment are:

 

Adjustment to market risks exhibit of the banking book (objective I).

 

Internal objective determination, and the link with the CMF capital charge establishment, in accordance with article 66 quinquies of the LGB (objective III).

 

Communication (objective III).

 

The Banks is waitig for final regulations.

 

Capital metrics

 

Minimum required capital

 

According to the General Banking Law, a bank must have a minimum of UF800,000 (approximately $29,431 million or US$34 million as of December 31, 2023) of paid-in capital and reserves, calculated in accordance with the FMC Regulations.

 

Capital requirement

 

Under the General Banking Law, banks must maintain regulatory capital of at least 8% of risk-weighted assets, net of required credit losses, as well as a paid-in capital and reserve requirement ("tire capital") of at least 3% of total assets, also net of credit losses. Regulatory capital and basic capital are calculated on the basis of the Consolidated Financial Statements. As we are the result of a merger between two predecessors with significant market shares in the Chilean market, we are currently required to maintain a minimum regulatory capital to risk-weighted assets ratio of 9.63%.

 

Regulatory capital is defined as the aggregate of:

 

-the paid-in capital and reserves of a bank, excluding capital attributable to foreign subsidiaries and branches or core capital;

 

-subordinated bonds, valued at their placement price (but decreasing by 20.0% for each year during the period beginning six years before maturity), for an amount of up to 50.0% of its basic capital;

 

-voluntary provisions for credit losses in the amount of up to 1.25% of risk-weighted assets.

 

On August 21, 2020, the FMC issued new treatment guide, where special credits granted by the government (CORFO and FOGAPE) must be included in category 2 of the risk-weighted assets classification, going from credit risk weight of 100% to 10%.

 

On March 31, 2023, the FMC issued a press release communicating the annual qualification of systemic importance banks. The CMF board approved to maintain a 1.5% additional basic capital charge for one more year.

 

On May 24, 2023, the FMC issued a press release communicating the Counter Cyclical Capital buffer requirement activation. According to the above, the BCCh board agreed to activate the RCC at a level of 0.5% of risk-weighted assets, which must be implemented in a year term period, to face greater external financial uncertainty.

 

Since 2021, the new definition of regulatory capital is as follows:

 

-Paid-in capital of the bank for common shares subscribed and paid;

 

-Premium paid for the instruments included in this capital component;

 

F-168

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

-Reserves, both non-revenue and from profits, for depreciation of bonds with no fixed maturity period and for expiration of bonds with no fixed maturity period;

 

-“Other accumulated comprehensive income” items;

 

-Retained earnings from prior years, profit (loss) for the year, net of provisions for minimum dividends, revaluation of bonds with no fixed maturity period and payment of interest and/or dividends from financial instruments issued with regulatory capital;

 

-The non-controlling interest as indicated in the Compendium of Accounting Standards (CNC).

 

Total assets, risk-weighted assets, and components of effective equity

 

            Total assets, risk-weighted assets and components of effective equity according to Basel III           Consolidated
global
31-12-2023
MCh$
            Consolidated
global
31-12-2022
MCh$
     
1  Total assets according to the statement of financial position   70,857,886    68,164,604 
2  Investment in subsidiaries that are not consolidated        
-
 
3  Assets discounted from regulatory capital, other than item 2   10,823,906    12,270,810 
4  Credit equivalents   3,446,909    2,890,350 
5  Contingent credits   2,604,665    2,776,542 
6  Assets generated by the intermediation of financial instruments   33,260    243,345 
7  = (1-2-3+4+5-6) Total assets for regulatory purposes   66,052,294    61,317,341 
8.a  Assets weighted for credit risk, estimated according to the standard methodology (RAW)   30,333,749    28,401,718 
8.b  Assets weighted for credit risk, estimated according to internal methodologies (AWCR)   
-
    
-
 
8  Market Risk Weighted Assets (MRWA)   4,793,740    5,554,604 
10  Operational Risk Weighted Assets (OPWA)   4,424,739    4,070,594 
11.a  = (8.a/8.b+9+10) Risk Weighted Assets (RWA)   39,552,228    38,026,916 
11.b  = (8.a/8.b+9+10) Risk-weighted assets, after applying the output floor (RWA)   39,552,228    38,026,916 
12  Shareholders equity   4,367,159    4,128,808 
13  Non-controlling interest   124,735    109,563 
14  Goodwill   
-
    
-
 
15  Excess minority investment   
-
    
-
 
16  = (12+13-14-15) Common Equity Equivalent Tier 1 Capital (CET1)   4,491,894    4,238,371 
17  Additional deductions to common equity tier 1, other than item 2   94,013    25,455 
18  = (16-17-2) Common Equity Tier 1 (CET1)   4,397,881    4,212,916 
19  Voluntary (additional) provisions charged as additional capital tier 1 (AT1)   
-
    
-
 
20  Subordinated bonds imputed as additional capital level 1 (AT1)   
-
    190,135 
21  Preferred shares attributed to additional capital tier 1 (AT1)   
-
    
-
 
22  Perpetual bonds attributed to additional capital level 1 (AT1)   608,721    590,247 
23  Discounts applied to AT1   
-
    
-
 
24  = (19+20+21+22-23) Additional Tier 1 Capital (AT1)   608,721    780,382 
25  = (18+24) Equity Tier 1   5,006,602    4,993,298 
26  Voluntary (additional) provisions allocated as Tier 2 (T2) capital   293,000    293,000 
27  Subordinated bonds imputed as Tier 2 capital (T2)   1,679,130    1,472,749 
28  = (26+27) Capital nivel 2 equivalente (T2)   1,972,130    1,765,749 
29  Discounts applied to T2   
-
    
-
 
30  = (28-29) Tier 2 Capital (T2)   1,972,130    1,765,749 
31  = (25+30) Effective equity   6,978,732    6,759,047 
32  Additional basic capital required for the constitution of the conservation buffer   461,934    444,662 
33  Additional basic capital required to set up the countercyclical buffer   
-
    
-
 
34  Additional core capital required for banks rated as systemic   296,642    142,601 
35  Additional capital required for the evaluation of the adequacy of effective capital (Pillar 2)   
-
    
-
 

 

 

F-169

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 37 - RISK MANAGEMENT, continued

 

Solvency indicators and regulatory compliance indicators according to Basel III

 

            Solvency indicators and regulatory compliance indicators according to Basel III           Consolidated
global
31-12-2023
%
            Consolidated
global
31-12-2022
%
     
1  Leverage indicator (T1_I18/T1_I7)   6.66%   6.87%
1.a  Leverage indicator that the bank must meet, considering the minimum requirements   3.00%   3.00%
2  Basic capital indicator (T1_I18/T1_I11,b)   11.12%   11.08%
2.a  Basic capital indicator that the bank must meet, considering the minimum requirements   5.25%   4.88%
2.b  Capital buffer shortfall   
 
    
 
 
3  Tier 1 capital indicator (T1_I25/T1_I11,b)   12.66%   13.13%
3.a  Tier 1 capital indicator that the bank must meet, considering the minimum requirements   6.75%   6.38%
4  Effective equity indicators (T1_I31/T1_I11,b)   17.64%   17.77%
4.a  Effective equity indicator that the bank must meet, considering the minimum requirements   8.75%   8.38%
4.b  Effective equity indicator that the bank must meet, considering the charge for article 35 bis, if applicable   8.00%   8.00%
4.c  Effective equity indicator that the bank must meet, considering the minimum requirements, conservation buffer and anti-cyclical buffer   10.63%   9.63%
5  Credit rating   A    A 
   Regulatory compliance indicators for solvency          
6  Voluntary (additional) provisions allocated to Tier 2 capital (T2) in relation to APRCs (T1_I26/ (T1_I8,a or I8,b)   0.97%   1.03%
7  Subordinated bonds allocated to Tier 2 (T2) capital in relation to Tier 2 capital   38.18%   34.96%
8  Additional Tier 1 capital (AT1) in relation to basic capital (T1_I24/T1_I18)   13.84%   18.52%
9  Voluntary provisions (additional) and subordinated bonds that are charged to additional capital level 1 (AT1) in relation to the RWAs (T1_I19+T1_I20 / T1_I11,b)   0.00%   0.50%

 

F-170

Banco Santander-Chile and Subsidiaries
Notes to the Consolidated Financial Statements
As of December 31, 2023 and 2022 and for the years ended December 31, 2023, 2022 and 2021

 

NOTE 38 - SUBSEQUENT EVENTS

 

On January 11, 2024, the Bank issued a Swiss franc bond in the amount of CHF 225,000,000 - through our EMTN program, with maturity on October 25, 2027 at a placement rate of 2.445%.

 

In the local market, the bank has placed the following bonds:

 

Serie  Currency  Rate  Placement date  Amount
AA13   UF   3.40%   01-03-24    1,330,000
AA9   CLP   6.30%   01-03-24    38,700,000,000
AA7   CLP   6.80%   01-04-24    7,350,000,000
AA8   CLP   6.70%   01-05-24    1,000,000,000
W3   UF   1.60%   01-11-24    695,000
AA2   CLP   6.20%   01-11-24    4,000,000,000
AA14   UF   3.30%   02-07-24    1,950,000

 

On February 5, 2024, the International Finance Corporation (IFC) – member of the World Banking Group – announced the signing of US$200 million senior loan to Santander Chile to support mortgage loan portfolio expansion, aimed exclusively for women home adquisition.

 

On February 12, 2024, Santander Consumer Finance Ltda. has announced the signing of a conditional purchase contract with Servicios Financieros Mundo Crédito SpA for the automotive loan portfolio (eligible operations), for an amount of up to Ch$70,000 million. However, the purchase must be analized by the National Economic Prosecutor's Office (FNE), a mandatory procedure for concentration operations.

 

On February 20, 2024, these Consolidated Financial Statements were approved by the Board of Directors.

 

There are no other subsequent events that need to be disclosed occurred between January 1, 2024 and the date of issuance of these Consolidated Financial Statements (February 20, 2024).

 

JONATHAN COVARRUBIAS HERNANDEZ

Chief Accounting Officer

 

ROMAN BLANCO REINOSA

Chief Executive Officer

 

F-171

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

188446126794000000 206979000000 310468000000 517447000000 2.467 0.60 188446126794000000 300069000000 485191000000 808651000000 2.575 0.60 1733870000000 1813939000000 7080472000000 7925385000000 9033054000000 9433080000000 104516000000 137089000000 336536000000 418087000000 485191000000 485191000000 508377000000 18061000000 33702000000 74431000000 80069000000 81623000000 1129000000 7545000000 353000000 P1200M 87445 Foreign obligations 35.46 31.72 6.79 10.30 9.76 2.67 3.30 100.00 43245000000 0.50 0.50 Include Deposits and other demand liabilities, Time deposits and other time liabilities and Interbank borrowings 100.00 19.17 46.90 4.33 23.63 44.16 35.60 0.62 false FY 00000 0001027552 0001027552 2023-01-01 2023-12-31 0001027552 dei:BusinessContactMember 2023-01-01 2023-12-31 0001027552 bsac:AmericanDepositarySharesADSEachRepresentingTheRightToReceive400SharesOfCommonStockWithoutParValueMember 2023-01-01 2023-12-31 0001027552 bsac:SharesOfCommonStockWithoutParValueMember 2023-01-01 2023-12-31 0001027552 2024-02-16 0001027552 2023-12-31 0001027552 2022-12-31 0001027552 2022-01-01 2022-12-31 0001027552 2021-01-01 2021-12-31 0001027552 ifrs-full:IssuedCapitalMember 2020-12-31 0001027552 bsac:ReservesAndOtherRetainedEarningMember 2020-12-31 0001027552 bsac:EffectsOfMergerOfCompaniesUnderCommonControlMember 2020-12-31 0001027552 bsac:FairValueReserveMember 2020-12-31 0001027552 ifrs-full:CashFlowHedgesMember 2020-12-31 0001027552 bsac:IncomeTaxEffectsMember 2020-12-31 0001027552 bsac:OtherEquityInstrumentsMember 2020-12-31 0001027552 bsac:RetainedEarningsOfPriorYearsMember 2020-12-31 0001027552 bsac:IncomeForTheYearMember 2020-12-31 0001027552 bsac:ProvisionForMandatoryDividendsMember 2020-12-31 0001027552 ifrs-full:EquityAttributableToOwnersOfParentMember 2020-12-31 0001027552 ifrs-full:NoncontrollingInterestsMember 2020-12-31 0001027552 2020-12-31 0001027552 ifrs-full:IssuedCapitalMember 2021-01-01 2021-12-31 0001027552 bsac:ReservesAndOtherRetainedEarningMember 2021-01-01 2021-12-31 0001027552 bsac:EffectsOfMergerOfCompaniesUnderCommonControlMember 2021-01-01 2021-12-31 0001027552 bsac:FairValueReserveMember 2021-01-01 2021-12-31 0001027552 ifrs-full:CashFlowHedgesMember 2021-01-01 2021-12-31 0001027552 bsac:IncomeTaxEffectsMember 2021-01-01 2021-12-31 0001027552 bsac:OtherEquityInstrumentsMember 2021-01-01 2021-12-31 0001027552 bsac:RetainedEarningsOfPriorYearsMember 2021-01-01 2021-12-31 0001027552 bsac:IncomeForTheYearMember 2021-01-01 2021-12-31 0001027552 bsac:ProvisionForMandatoryDividendsMember 2021-01-01 2021-12-31 0001027552 ifrs-full:EquityAttributableToOwnersOfParentMember 2021-01-01 2021-12-31 0001027552 ifrs-full:NoncontrollingInterestsMember 2021-01-01 2021-12-31 0001027552 ifrs-full:IssuedCapitalMember 2021-12-31 0001027552 bsac:ReservesAndOtherRetainedEarningMember 2021-12-31 0001027552 bsac:EffectsOfMergerOfCompaniesUnderCommonControlMember 2021-12-31 0001027552 bsac:FairValueReserveMember 2021-12-31 0001027552 ifrs-full:CashFlowHedgesMember 2021-12-31 0001027552 bsac:IncomeTaxEffectsMember 2021-12-31 0001027552 bsac:OtherEquityInstrumentsMember 2021-12-31 0001027552 bsac:RetainedEarningsOfPriorYearsMember 2021-12-31 0001027552 bsac:IncomeForTheYearMember 2021-12-31 0001027552 bsac:ProvisionForMandatoryDividendsMember 2021-12-31 0001027552 ifrs-full:EquityAttributableToOwnersOfParentMember 2021-12-31 0001027552 ifrs-full:NoncontrollingInterestsMember 2021-12-31 0001027552 2021-12-31 0001027552 ifrs-full:IssuedCapitalMember 2022-01-01 2022-12-31 0001027552 bsac:ReservesAndOtherRetainedEarningMember 2022-01-01 2022-12-31 0001027552 bsac:EffectsOfMergerOfCompaniesUnderCommonControlMember 2022-01-01 2022-12-31 0001027552 bsac:FairValueReserveMember 2022-01-01 2022-12-31 0001027552 ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:IncomeTaxEffectsMember 2022-01-01 2022-12-31 0001027552 bsac:OtherEquityInstrumentsMember 2022-01-01 2022-12-31 0001027552 bsac:RetainedEarningsOfPriorYearsMember 2022-01-01 2022-12-31 0001027552 bsac:IncomeForTheYearMember 2022-01-01 2022-12-31 0001027552 bsac:ProvisionForMandatoryDividendsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:EquityAttributableToOwnersOfParentMember 2022-01-01 2022-12-31 0001027552 ifrs-full:NoncontrollingInterestsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:IssuedCapitalMember 2022-12-31 0001027552 bsac:ReservesAndOtherRetainedEarningMember 2022-12-31 0001027552 bsac:EffectsOfMergerOfCompaniesUnderCommonControlMember 2022-12-31 0001027552 bsac:FairValueReserveMember 2022-12-31 0001027552 ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 bsac:IncomeTaxEffectsMember 2022-12-31 0001027552 bsac:OtherEquityInstrumentsMember 2022-12-31 0001027552 bsac:RetainedEarningsOfPriorYearsMember 2022-12-31 0001027552 bsac:IncomeForTheYearMember 2022-12-31 0001027552 bsac:ProvisionForMandatoryDividendsMember 2022-12-31 0001027552 ifrs-full:EquityAttributableToOwnersOfParentMember 2022-12-31 0001027552 ifrs-full:NoncontrollingInterestsMember 2022-12-31 0001027552 ifrs-full:IssuedCapitalMember 2023-01-01 2023-12-31 0001027552 bsac:ReservesAndOtherRetainedEarningMember 2023-01-01 2023-12-31 0001027552 bsac:EffectsOfMergerOfCompaniesUnderCommonControlMember 2023-01-01 2023-12-31 0001027552 bsac:FairValueReserveMember 2023-01-01 2023-12-31 0001027552 ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IncomeTaxEffectsMember 2023-01-01 2023-12-31 0001027552 bsac:OtherEquityInstrumentsMember 2023-01-01 2023-12-31 0001027552 bsac:RetainedEarningsOfPriorYearsMember 2023-01-01 2023-12-31 0001027552 bsac:IncomeForTheYearMember 2023-01-01 2023-12-31 0001027552 bsac:ProvisionForMandatoryDividendsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:NoncontrollingInterestsMember 2023-01-01 2023-12-31 0001027552 bsac:ExtraordinaryShareholdersMeetingMember 2023-01-01 2023-12-31 0001027552 ifrs-full:EquityAttributableToOwnersOfParentMember 2023-01-01 2023-12-31 0001027552 ifrs-full:IssuedCapitalMember 2023-12-31 0001027552 bsac:ReservesAndOtherRetainedEarningMember 2023-12-31 0001027552 bsac:EffectsOfMergerOfCompaniesUnderCommonControlMember 2023-12-31 0001027552 bsac:FairValueReserveMember 2023-12-31 0001027552 ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 bsac:IncomeTaxEffectsMember 2023-12-31 0001027552 bsac:OtherEquityInstrumentsMember 2023-12-31 0001027552 bsac:RetainedEarningsOfPriorYearsMember 2023-12-31 0001027552 bsac:IncomeForTheYearMember 2023-12-31 0001027552 bsac:ProvisionForMandatoryDividendsMember 2023-12-31 0001027552 ifrs-full:EquityAttributableToOwnersOfParentMember 2023-12-31 0001027552 ifrs-full:NoncontrollingInterestsMember 2023-12-31 0001027552 bsac:SubordinatedbondsMember 2022-01-01 2022-12-31 0001027552 bsac:SubordinatedbondsMember 2023-01-01 2023-12-31 0001027552 bsac:PerpetualBondMember 2022-01-01 2022-12-31 0001027552 bsac:PerpetualBondMember 2023-01-01 2023-12-31 0001027552 bsac:MortgageBondsMember 2022-01-01 2022-12-31 0001027552 bsac:MortgageBondsMember 2023-01-01 2023-12-31 0001027552 bsac:DividendsPaidMember 2022-01-01 2022-12-31 0001027552 bsac:DividendsPaidMember 2023-01-01 2023-12-31 0001027552 bsac:LeaseObligationsMember 2022-01-01 2022-12-31 0001027552 bsac:LeaseObligationsMember 2023-01-01 2023-12-31 0001027552 bsac:BancoSantanderChileMember bsac:BancoSantanderSpainMember 2023-01-01 2023-12-31 0001027552 bsac:TeatinosSigloXXiInversionesLtdaMember bsac:BancoSantanderSpainMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderChileBankMember bsac:BancoSantanderSpainMember 2023-01-01 2023-12-31 0001027552 bsac:CLFMember 2023-12-31 0001027552 bsac:CLFMember 2022-12-31 0001027552 ifrs-full:TopOfRangeMember 2023-01-01 2023-12-31 0001027552 ifrs-full:BottomOfRangeMember 2022-01-01 2022-12-31 0001027552 ifrs-full:LifetimeExpectedCreditLossesMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderCorredoraDeSegurosLimitadaMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderCorredoraDeSegurosLimitadaMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderCorredoraDeSegurosLimitadaMember 2021-01-01 2021-12-31 0001027552 bsac:SantanderCorredoresDeBolsaLimitadaMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderCorredoresDeBolsaLimitadaMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderCorredoresDeBolsaLimitadaMember 2021-01-01 2021-12-31 0001027552 bsac:SantanderAsesoriasFinancierasLimitadaMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderAsesoriasFinancierasLimitadaMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderAsesoriasFinancierasLimitadaMember 2021-01-01 2021-12-31 0001027552 bsac:SantanderSASociedadSecuritizadoraMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderSASociedadSecuritizadoraMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderSASociedadSecuritizadoraMember 2021-01-01 2021-12-31 0001027552 bsac:KlareCorredoraDeSegurosSAMember 2023-01-01 2023-12-31 0001027552 bsac:KlareCorredoraDeSegurosSAMember 2022-01-01 2022-12-31 0001027552 bsac:KlareCorredoraDeSegurosSAMember 2021-01-01 2021-12-31 0001027552 bsac:SantanderConsumerChileSAMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderConsumerChileSAMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderConsumerChileSAMember 2021-01-01 2021-12-31 0001027552 bsac:SociedadOperadoraDeTarjetasDePagoSantanderGetnetChileSAMember 2023-01-01 2023-12-31 0001027552 bsac:SociedadOperadoraDeTarjetasDePagoSantanderGetnetChileSAMember 2022-01-01 2022-12-31 0001027552 bsac:SociedadOperadoraDeTarjetasDePagoSantanderGetnetChileSAMember 2021-01-01 2021-12-31 0001027552 bsac:RedbancSAMember 2023-01-01 2023-12-31 0001027552 bsac:RedbancSAMember 2022-01-01 2022-12-31 0001027552 bsac:RedbancSAMember 2021-01-01 2021-12-31 0001027552 bsac:TransbankSAMember 2023-01-01 2023-12-31 0001027552 bsac:TransbankSAMember 2022-01-01 2022-12-31 0001027552 bsac:TransbankSAMember 2021-01-01 2021-12-31 0001027552 bsac:CentroDeCompensacinAutomatizadoSAMember 2023-01-01 2023-12-31 0001027552 bsac:CentroDeCompensacinAutomatizadoSAMember 2022-01-01 2022-12-31 0001027552 bsac:CentroDeCompensacinAutomatizadoSAMember 2021-01-01 2021-12-31 0001027552 bsac:SociedadInterbancariaDeDepsitoDeValoresSAMember 2023-01-01 2023-12-31 0001027552 bsac:SociedadInterbancariaDeDepsitoDeValoresSAMember 2022-01-01 2022-12-31 0001027552 bsac:SociedadInterbancariaDeDepsitoDeValoresSAMember 2021-01-01 2021-12-31 0001027552 bsac:CmaraCompensacinDeAltoValorSAMember 2023-01-01 2023-12-31 0001027552 bsac:CmaraCompensacinDeAltoValorSAMember 2022-01-01 2022-12-31 0001027552 bsac:CmaraCompensacinDeAltoValorSAMember 2021-01-01 2021-12-31 0001027552 bsac:AdministradorFinancieroDelTransantiagoSAMember 2023-01-01 2023-12-31 0001027552 bsac:AdministradorFinancieroDelTransantiagoSAMember 2022-01-01 2022-12-31 0001027552 bsac:AdministradorFinancieroDelTransantiagoSAMember 2021-01-01 2021-12-31 0001027552 bsac:ServiciosDeInfraestructuraDeMercadoOTCSAMember 2023-01-01 2023-12-31 0001027552 bsac:ServiciosDeInfraestructuraDeMercadoOTCSAMember 2022-01-01 2022-12-31 0001027552 bsac:ServiciosDeInfraestructuraDeMercadoOTCSAMember 2021-01-01 2021-12-31 0001027552 ifrs-full:LandMember 2023-01-01 2023-12-31 0001027552 bsac:PaintingsAndWorksOfArtMember 2023-01-01 2023-12-31 0001027552 bsac:CarpetsAndCurtainsMember 2023-01-01 2023-12-31 0001027552 bsac:ComputersAndHardwareMember 2023-01-01 2023-12-31 0001027552 ifrs-full:VehiclesMember 2023-01-01 2023-12-31 0001027552 bsac:ItSystemsAndSoftwareMember 2023-01-01 2023-12-31 0001027552 bsac:ATMsMember 2023-01-01 2023-12-31 0001027552 bsac:OtherMachinesAndEquipmentMember 2023-01-01 2023-12-31 0001027552 bsac:OfficeFurnitureMember 2023-01-01 2023-12-31 0001027552 bsac:TelephoneAndCommunicationSystemsMember 2023-01-01 2023-12-31 0001027552 bsac:SecuritySystemsMember 2023-01-01 2023-12-31 0001027552 bsac:RightsOverTelephoneLinesMember 2023-01-01 2023-12-31 0001027552 bsac:AirConditioningSystemsMember 2023-01-01 2023-12-31 0001027552 bsac:OtherInstallationsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:BuildingsMember 2023-01-01 2023-12-31 0001027552 bsac:ConsumerLoansWithOrWithoutCollateralMember 2023-01-01 2023-12-31 0001027552 bsac:OtherTransactionsWithoutCollateralMember 2023-01-01 2023-12-31 0001027552 bsac:CommercialLoansWithCollateralMember 2023-01-01 2023-12-31 0001027552 bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:ConsumerLeasingMember 2023-01-01 2023-12-31 0001027552 bsac:OtherNonMortgageLeasingTransactionsMember 2023-01-01 2023-12-31 0001027552 bsac:MortgageLeasingHouseholdAndBusinessMember 2023-01-01 2023-12-31 0001027552 2022-07-25 0001027552 2023-08-30 0001027552 2023-08-01 2023-08-21 0001027552 2023-10-01 2023-10-05 0001027552 2023-10-20 0001027552 2023-10-20 2023-10-20 0001027552 bsac:MonetaryPolicyRateMPRMember ifrs-full:TopOfRangeMember 2023-07-28 0001027552 bsac:MonetaryPolicyRateMPRMember ifrs-full:BottomOfRangeMember 2023-07-28 0001027552 bsac:MonetaryPolicyRateMPRMember 2023-09-04 0001027552 bsac:MonetaryPolicyRateMPRMember 2023-12-31 0001027552 bsac:AA1Member 2023-01-01 2023-12-31 0001027552 bsac:AA1Member 2023-12-31 0001027552 bsac:AA2Member 2023-01-01 2023-12-31 0001027552 bsac:AA2Member 2023-12-31 0001027552 bsac:AA3Member 2023-01-01 2023-12-31 0001027552 bsac:AA3Member 2023-12-31 0001027552 bsac:AA4Member 2023-01-01 2023-12-31 0001027552 bsac:AA4Member 2023-12-31 0001027552 bsac:AA5Member 2023-01-01 2023-12-31 0001027552 bsac:AA5Member 2023-12-31 0001027552 bsac:AA6Member 2023-01-01 2023-12-31 0001027552 bsac:AA6Member 2023-12-31 0001027552 bsac:AA7Member 2023-01-01 2023-12-31 0001027552 bsac:AA7Member 2023-12-31 0001027552 bsac:AA8Member 2023-01-01 2023-12-31 0001027552 bsac:AA8Member 2023-12-31 0001027552 bsac:AA9Member 2023-01-01 2023-12-31 0001027552 bsac:AA9Member 2023-12-31 0001027552 bsac:AA10Member 2023-01-01 2023-12-31 0001027552 bsac:AA10Member 2023-12-31 0001027552 bsac:AA11Member 2023-01-01 2023-12-31 0001027552 bsac:AA11Member 2023-12-31 0001027552 bsac:AA12Member 2023-01-01 2023-12-31 0001027552 bsac:AA12Member 2023-12-31 0001027552 bsac:AA13Member 2023-01-01 2023-12-31 0001027552 bsac:AA13Member 2023-12-31 0001027552 bsac:RetailBankingMember 2023-01-01 2023-12-31 0001027552 ifrs-full:TopOfRangeMember bsac:MiddleMarketMember 2023-01-01 2023-12-31 0001027552 ifrs-full:BottomOfRangeMember bsac:MiddleMarketMember 2023-01-01 2023-12-31 0001027552 bsac:GlobalCorporateBanking1Member 2023-01-01 2023-12-31 0001027552 bsac:RetailBankingMember 2023-12-31 0001027552 bsac:MiddleMarketMember 2023-12-31 0001027552 bsac:MiddleMarketMember 2023-01-01 2023-12-31 0001027552 bsac:CIBMember 2023-12-31 0001027552 bsac:CIBMember 2023-01-01 2023-12-31 0001027552 bsac:OtherOneMember 2023-12-31 0001027552 bsac:OtherOneMember 2023-01-01 2023-12-31 0001027552 ifrs-full:ReportableSegmentsMember 2023-12-31 0001027552 ifrs-full:ReportableSegmentsMember 2023-01-01 2023-12-31 0001027552 bsac:RetailBankingMember 2022-12-31 0001027552 bsac:RetailBankingMember 2022-01-01 2022-12-31 0001027552 bsac:MiddleMarketMember 2022-12-31 0001027552 bsac:MiddleMarketMember 2022-01-01 2022-12-31 0001027552 bsac:CIBMember 2022-12-31 0001027552 bsac:CIBMember 2022-01-01 2022-12-31 0001027552 bsac:OtherOneMember 2022-12-31 0001027552 bsac:OtherOneMember 2022-01-01 2022-12-31 0001027552 ifrs-full:ReportableSegmentsMember 2022-12-31 0001027552 ifrs-full:ReportableSegmentsMember 2022-01-01 2022-12-31 0001027552 bsac:RetailBankingMember 2021-12-31 0001027552 bsac:RetailBankingMember 2021-01-01 2021-12-31 0001027552 bsac:MiddleMarketMember 2021-12-31 0001027552 bsac:MiddleMarketMember 2021-01-01 2021-12-31 0001027552 bsac:CIBMember 2021-12-31 0001027552 bsac:CIBMember 2021-01-01 2021-12-31 0001027552 bsac:OtherOneMember 2021-12-31 0001027552 bsac:OtherOneMember 2021-01-01 2021-12-31 0001027552 ifrs-full:ReportableSegmentsMember 2021-12-31 0001027552 ifrs-full:ReportableSegmentsMember 2021-01-01 2021-12-31 0001027552 bsac:ForwardsMember bsac:FinancialAssetsDerivativesContractsCategoryMember 2023-12-31 0001027552 bsac:ForwardsMember bsac:FinancialAssetsDerivativesContractsCategoryMember 2022-12-31 0001027552 bsac:SwapsMember bsac:FinancialAssetsDerivativesContractsCategoryMember 2023-12-31 0001027552 bsac:SwapsMember bsac:FinancialAssetsDerivativesContractsCategoryMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember bsac:FinancialAssetsDerivativesContractsCategoryMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember bsac:FinancialAssetsDerivativesContractsCategoryMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember bsac:FinancialAssetsDerivativesContractsCategoryMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember bsac:FinancialAssetsDerivativesContractsCategoryMember 2022-12-31 0001027552 bsac:FinancialAssetsDerivativesContractsCategoryMember 2023-12-31 0001027552 bsac:FinancialAssetsDerivativesContractsCategoryMember 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:DebtFinancialInstrumentsMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:DebtFinancialInstrumentsMember 2022-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember bsac:DebtFinancialInstrumentsMember 2023-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember bsac:DebtFinancialInstrumentsMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember 2022-12-31 0001027552 ifrs-full:ForwardContractMember ifrs-full:OnDemandMember 2023-12-31 0001027552 ifrs-full:ForwardContractMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 ifrs-full:ForwardContractMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 ifrs-full:ForwardContractMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2023-12-31 0001027552 ifrs-full:ForwardContractMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2023-12-31 0001027552 ifrs-full:ForwardContractMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 ifrs-full:ForwardContractMember ifrs-full:LaterThanFiveYearsMember 2023-12-31 0001027552 ifrs-full:ForwardContractMember 2023-12-31 0001027552 ifrs-full:ForwardContractMember ifrs-full:AtFairValueMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:OnDemandMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanFiveYearsMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:AtFairValueMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:OnDemandMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanFiveYearsMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:AtFairValueMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:OnDemandMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanFiveYearsMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:AtFairValueMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:OnDemandMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanFiveYearsMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:AtFairValueMember 2023-12-31 0001027552 ifrs-full:OnDemandMember 2023-12-31 0001027552 ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2023-12-31 0001027552 ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2023-12-31 0001027552 ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 ifrs-full:LaterThanFiveYearsMember 2023-12-31 0001027552 ifrs-full:AtFairValueMember 2023-12-31 0001027552 ifrs-full:ForwardContractMember ifrs-full:OnDemandMember 2022-12-31 0001027552 ifrs-full:ForwardContractMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 ifrs-full:ForwardContractMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 ifrs-full:ForwardContractMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2022-12-31 0001027552 ifrs-full:ForwardContractMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2022-12-31 0001027552 ifrs-full:ForwardContractMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 ifrs-full:ForwardContractMember ifrs-full:LaterThanFiveYearsMember 2022-12-31 0001027552 ifrs-full:ForwardContractMember 2022-12-31 0001027552 ifrs-full:ForwardContractMember ifrs-full:AtFairValueMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:OnDemandMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanFiveYearsMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:AtFairValueMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:OnDemandMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanFiveYearsMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:AtFairValueMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:OnDemandMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanFiveYearsMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:AtFairValueMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:OnDemandMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanFiveYearsMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:AtFairValueMember 2022-12-31 0001027552 ifrs-full:OnDemandMember 2022-12-31 0001027552 ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2022-12-31 0001027552 ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2022-12-31 0001027552 ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 ifrs-full:LaterThanFiveYearsMember 2022-12-31 0001027552 ifrs-full:AtFairValueMember 2022-12-31 0001027552 bsac:ChileanCentralBankFinancialInstrumentsMember bsac:ChileanCentralBankAndGovernmentSecuritiesMember 2023-12-31 0001027552 bsac:ChileanCentralBankFinancialInstrumentsMember bsac:ChileanCentralBankAndGovernmentSecuritiesMember 2022-12-31 0001027552 bsac:ChileanCentralBankBondsMember bsac:ChileanCentralBankAndGovernmentSecuritiesMember 2023-12-31 0001027552 bsac:ChileanCentralBankBondsMember bsac:ChileanCentralBankAndGovernmentSecuritiesMember 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember 2022-12-31 0001027552 bsac:ChileanCorporateBondsMember bsac:OtherChileanDebtFinancialSecuritiesMember 2023-12-31 0001027552 bsac:ChileanCorporateBondsMember bsac:OtherChileanDebtFinancialSecuritiesMember 2022-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember 2023-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember 2022-12-31 0001027552 bsac:OtherForeignFinancialInstrumentsMember bsac:ForeignFinancialDebtSecuritiesMember 2023-12-31 0001027552 bsac:OtherForeignFinancialInstrumentsMember bsac:ForeignFinancialDebtSecuritiesMember 2022-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember 2023-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember 2022-12-31 0001027552 bsac:ComderContraparteCentralSAMember 2023-12-31 0001027552 bsac:ComderContraparteCentralSAMember 2022-12-31 0001027552 bsac:LondonClearingHouseMember 2023-12-31 0001027552 bsac:LondonClearingHouseMember 2022-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember bsac:DebtFinancialInstrumentsMember 2023-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember bsac:DebtFinancialInstrumentsMember 2022-12-31 0001027552 bsac:CommercialLoansMember bsac:OtherFinancialInstrumentsMember 2023-12-31 0001027552 bsac:CommercialLoansMember bsac:OtherFinancialInstrumentsMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsMember 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:ChileanCentralBankFinancialInstrumentsMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:ChileanCentralBankFinancialInstrumentsMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtFairValueThroughOtherComprehensiveIncomeMember bsac:ChileanTreasuryBondsAndNotesMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFairValueThroughOtherComprehensiveIncomeMember bsac:ChileanTreasuryBondsAndNotesMember 2022-12-31 0001027552 bsac:TotalSubtotalChileanCentralBankAndGovernmentSecuritiesMember 2023-12-31 0001027552 bsac:TotalSubtotalChileanCentralBankAndGovernmentSecuritiesMember 2022-12-31 0001027552 bsac:RepurchaseAgreementMember 2023-12-31 0001027552 bsac:RepurchaseAgreementMember 2022-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember bsac:ChileanBankDebtFinancialInstrumentsMember 2023-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember bsac:ChileanBankDebtFinancialInstrumentsMember 2022-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember bsac:OtherChileanFinancialInstrumentsMember 2023-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember bsac:OtherChileanFinancialInstrumentsMember 2022-12-31 0001027552 bsac:TotalSubtotalOtherChileanDebtFinancialSecuritiesMember 2023-12-31 0001027552 bsac:TotalSubtotalOtherChileanDebtFinancialSecuritiesMember 2022-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember bsac:SecuritiesSoldUnderRepurchaseAgreementsMember 2023-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember bsac:SecuritiesSoldUnderRepurchaseAgreementsMember 2022-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember bsac:ForeignCentralBanksFinancialInstrumentsMember 2023-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember bsac:ForeignCentralBanksFinancialInstrumentsMember 2022-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember bsac:OtherForeignDebtFinancialInstrumentsMember 2023-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember bsac:OtherForeignDebtFinancialInstrumentsMember 2022-12-31 0001027552 bsac:TotalSubtotalForeignFinancialDebtSecuritiesMember 2023-12-31 0001027552 bsac:TotalSubtotalForeignFinancialDebtSecuritiesMember 2022-12-31 0001027552 bsac:TotalSubtotalForeignFinancialDebtSecuritiesMember bsac:RepurchaseAgreementMember 2023-12-31 0001027552 bsac:TotalSubtotalForeignFinancialDebtSecuritiesMember bsac:RepurchaseAgreementMember 2022-12-31 0001027552 bsac:ExpectedCreditLossesStage1Member 2022-12-31 0001027552 bsac:ExpectedCreditLossesStage2Member 2022-12-31 0001027552 bsac:ExpectedCreditLossesStage3Member 2022-12-31 0001027552 bsac:ExpectedCreditLossesStage1Member 2023-01-01 2023-12-31 0001027552 bsac:ExpectedCreditLossesStage2Member 2023-01-01 2023-12-31 0001027552 bsac:ExpectedCreditLossesStage3Member 2023-01-01 2023-12-31 0001027552 bsac:ExpectedCreditLossesStage1Member 2023-12-31 0001027552 bsac:ExpectedCreditLossesStage2Member 2023-12-31 0001027552 bsac:ExpectedCreditLossesStage3Member 2023-12-31 0001027552 bsac:ExpectedCreditLossesMember bsac:ExpectedCreditLossesStage1Member 2022-12-31 0001027552 bsac:ExpectedCreditLossesMember bsac:ExpectedCreditLossesStage2Member 2022-12-31 0001027552 bsac:ExpectedCreditLossesMember bsac:ExpectedCreditLossesStage3Member 2022-12-31 0001027552 bsac:ExpectedCreditLossesMember 2022-12-31 0001027552 bsac:ExpectedCreditLossesMember bsac:ExpectedCreditLossesStage1Member 2023-01-01 2023-12-31 0001027552 bsac:ExpectedCreditLossesMember bsac:ExpectedCreditLossesStage2Member 2023-01-01 2023-12-31 0001027552 bsac:ExpectedCreditLossesMember bsac:ExpectedCreditLossesStage3Member 2023-01-01 2023-12-31 0001027552 bsac:ExpectedCreditLossesMember 2023-01-01 2023-12-31 0001027552 bsac:ExpectedCreditLossesMember bsac:ExpectedCreditLossesStage1Member 2023-12-31 0001027552 bsac:ExpectedCreditLossesMember bsac:ExpectedCreditLossesStage2Member 2023-12-31 0001027552 bsac:ExpectedCreditLossesMember bsac:ExpectedCreditLossesStage3Member 2023-12-31 0001027552 bsac:ExpectedCreditLossesMember 2023-12-31 0001027552 bsac:ExpectedCreditLossesStage1Member 2021-12-31 0001027552 bsac:ExpectedCreditLossesStage2Member 2021-12-31 0001027552 bsac:ExpectedCreditLossesStage3Member 2021-12-31 0001027552 bsac:ExpectedCreditLossesStage1Member 2022-01-01 2022-12-31 0001027552 bsac:ExpectedCreditLossesStage2Member 2022-01-01 2022-12-31 0001027552 bsac:ExpectedCreditLossesStage3Member 2022-01-01 2022-12-31 0001027552 bsac:ExpectedCreditLossesMember bsac:ExpectedCreditLossesStage1Member 2021-12-31 0001027552 bsac:ExpectedCreditLossesMember bsac:ExpectedCreditLossesStage2Member 2021-12-31 0001027552 bsac:ExpectedCreditLossesMember bsac:ExpectedCreditLossesStage3Member 2021-12-31 0001027552 bsac:ExpectedCreditLossesMember 2021-12-31 0001027552 bsac:ExpectedCreditLossesMember bsac:ExpectedCreditLossesStage1Member 2022-01-01 2022-12-31 0001027552 bsac:ExpectedCreditLossesMember bsac:ExpectedCreditLossesStage2Member 2022-01-01 2022-12-31 0001027552 bsac:ExpectedCreditLossesMember bsac:ExpectedCreditLossesStage3Member 2022-01-01 2022-12-31 0001027552 bsac:ExpectedCreditLossesMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member 2022-12-31 0001027552 bsac:Stage2Member 2022-12-31 0001027552 bsac:StageThreeMember 2022-12-31 0001027552 bsac:Stage1Member 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member 2023-01-01 2023-12-31 0001027552 bsac:StageThreeMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member 2023-12-31 0001027552 bsac:Stage2Member 2023-12-31 0001027552 bsac:StageThreeMember 2023-12-31 0001027552 bsac:Stage1Member 2021-12-31 0001027552 bsac:Stage2Member 2021-12-31 0001027552 bsac:StageThreeMember 2021-12-31 0001027552 bsac:Stage1Member 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member 2022-01-01 2022-12-31 0001027552 bsac:StageThreeMember 2022-01-01 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:ChileanCentralBankFinancialInstrumentsMember ifrs-full:NotLaterThanOneYearMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:ChileanCentralBankFinancialInstrumentsMember ifrs-full:LaterThanOneYearMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:ChileanTreasuryBondsAndNotesMember ifrs-full:NotLaterThanOneYearMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:ChileanTreasuryBondsAndNotesMember ifrs-full:LaterThanOneYearMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:ChileanTreasuryBondsAndNotesMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:OtherChileanGovernmentFinancialInstrumentsMember ifrs-full:NotLaterThanOneYearMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:OtherChileanGovernmentFinancialInstrumentsMember ifrs-full:LaterThanOneYearMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:OtherChileanGovernmentFinancialInstrumentsMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember ifrs-full:NotLaterThanOneYearMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember ifrs-full:LaterThanOneYearMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember 2023-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember bsac:ChileanBankDebtFinancialInstrumentsMember ifrs-full:NotLaterThanOneYearMember 2023-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember bsac:ChileanBankDebtFinancialInstrumentsMember ifrs-full:LaterThanOneYearMember 2023-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember bsac:OtherChileanFinancialInstrumentsMember ifrs-full:NotLaterThanOneYearMember 2023-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember bsac:OtherChileanFinancialInstrumentsMember ifrs-full:LaterThanOneYearMember 2023-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember ifrs-full:NotLaterThanOneYearMember 2023-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember ifrs-full:LaterThanOneYearMember 2023-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember 2023-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember bsac:ForeignCentralBanksFinancialInstrumentsMember ifrs-full:NotLaterThanOneYearMember 2023-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember bsac:ForeignCentralBanksFinancialInstrumentsMember ifrs-full:LaterThanOneYearMember 2023-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember bsac:OtherForeignDebtFinancialInstrumentsMember ifrs-full:NotLaterThanOneYearMember 2023-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember bsac:OtherForeignDebtFinancialInstrumentsMember ifrs-full:LaterThanOneYearMember 2023-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember ifrs-full:NotLaterThanOneYearMember 2023-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember ifrs-full:LaterThanOneYearMember 2023-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomerMember bsac:CommercialLoansMember ifrs-full:NotLaterThanOneYearMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomerMember bsac:CommercialLoansMember ifrs-full:LaterThanOneYearMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomerMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomerMember ifrs-full:NotLaterThanOneYearMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomerMember ifrs-full:LaterThanOneYearMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomerMember 2023-12-31 0001027552 ifrs-full:NotLaterThanOneYearMember 2023-12-31 0001027552 ifrs-full:LaterThanOneYearMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:ChileanCentralBankFinancialInstrumentsMember ifrs-full:NotLaterThanOneYearMember 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:ChileanCentralBankFinancialInstrumentsMember ifrs-full:LaterThanOneYearMember 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:ChileanTreasuryBondsAndNotesMember ifrs-full:NotLaterThanOneYearMember 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:ChileanTreasuryBondsAndNotesMember ifrs-full:LaterThanOneYearMember 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:ChileanTreasuryBondsAndNotesMember 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:OtherChileanGovernmentFinancialInstrumentsMember ifrs-full:NotLaterThanOneYearMember 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:OtherChileanGovernmentFinancialInstrumentsMember ifrs-full:LaterThanOneYearMember 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:OtherChileanGovernmentFinancialInstrumentsMember 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember ifrs-full:NotLaterThanOneYearMember 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember ifrs-full:LaterThanOneYearMember 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember 2022-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember bsac:ChileanBankDebtFinancialInstrumentsMember ifrs-full:NotLaterThanOneYearMember 2022-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember bsac:ChileanBankDebtFinancialInstrumentsMember ifrs-full:LaterThanOneYearMember 2022-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember bsac:OtherChileanFinancialInstrumentsMember ifrs-full:NotLaterThanOneYearMember 2022-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember bsac:OtherChileanFinancialInstrumentsMember ifrs-full:LaterThanOneYearMember 2022-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember ifrs-full:NotLaterThanOneYearMember 2022-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember ifrs-full:LaterThanOneYearMember 2022-12-31 0001027552 bsac:OtherChileanDebtFinancialSecuritiesMember 2022-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember bsac:ForeignCentralBanksFinancialInstrumentsMember ifrs-full:NotLaterThanOneYearMember 2022-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember bsac:ForeignCentralBanksFinancialInstrumentsMember ifrs-full:LaterThanOneYearMember 2022-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember bsac:OtherForeignDebtFinancialInstrumentsMember ifrs-full:NotLaterThanOneYearMember 2022-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember bsac:OtherForeignDebtFinancialInstrumentsMember ifrs-full:LaterThanOneYearMember 2022-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember ifrs-full:NotLaterThanOneYearMember 2022-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember ifrs-full:LaterThanOneYearMember 2022-12-31 0001027552 bsac:ForeignFinancialDebtSecuritiesMember 2022-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomerMember bsac:CommercialLoansMember ifrs-full:NotLaterThanOneYearMember 2022-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomerMember bsac:CommercialLoansMember ifrs-full:LaterThanOneYearMember 2022-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomerMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomerMember ifrs-full:NotLaterThanOneYearMember 2022-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomerMember ifrs-full:LaterThanOneYearMember 2022-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomerMember 2022-12-31 0001027552 ifrs-full:NotLaterThanOneYearMember 2022-12-31 0001027552 ifrs-full:LaterThanOneYearMember 2022-12-31 0001027552 ifrs-full:InterestRateSwapContractMember bsac:UpToOneMonthMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 ifrs-full:InterestRateSwapContractMember bsac:Between1And3MonthMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 ifrs-full:InterestRateSwapContractMember bsac:Between3And12MonthsMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 ifrs-full:InterestRateSwapContractMember bsac:Between1And3YearsMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 ifrs-full:InterestRateSwapContractMember bsac:Between3And5YearsMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 ifrs-full:InterestRateSwapContractMember bsac:MoreThan5YearsMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 ifrs-full:InterestRateSwapContractMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:UpToOneMonthMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between1And3MonthMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between3And12MonthsMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between1And3YearsMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between3And5YearsMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:MoreThan5YearsMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 bsac:UpToOneMonthMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 bsac:Between1And3MonthMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 bsac:Between3And12MonthsMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 bsac:Between1And3YearsMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 bsac:Between3And5YearsMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 bsac:MoreThan5YearsMember ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 ifrs-full:FairValueHedgesMember 2023-12-31 0001027552 bsac:CurrencyForwardsMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 bsac:CurrencyForwardsMember bsac:Between1And3MonthMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 bsac:CurrencyForwardsMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 bsac:CurrencyForwardsMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 bsac:CurrencyForwardsMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 bsac:CurrencyForwardsMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between1And3MonthMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 bsac:Between1And3MonthMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 ifrs-full:CashFlowHedgesMember 2023-12-31 0001027552 bsac:UpToOneMonthMember 2023-12-31 0001027552 bsac:Between1And3MonthMember 2023-12-31 0001027552 bsac:Between3And12MonthsMember 2023-12-31 0001027552 bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:Between3And5YearsMember 2023-12-31 0001027552 bsac:MoreThan5YearsMember 2023-12-31 0001027552 ifrs-full:InterestRateSwapContractMember bsac:UpToOneMonthMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 ifrs-full:InterestRateSwapContractMember bsac:Between1And3MonthMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 ifrs-full:InterestRateSwapContractMember bsac:Between3And12MonthsMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 ifrs-full:InterestRateSwapContractMember bsac:Between1And3YearsMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 ifrs-full:InterestRateSwapContractMember bsac:Between3And5YearsMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 ifrs-full:InterestRateSwapContractMember bsac:MoreThan5YearsMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 ifrs-full:InterestRateSwapContractMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:UpToOneMonthMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between1And3MonthMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between3And12MonthsMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between1And3YearsMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between3And5YearsMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:MoreThan5YearsMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 bsac:UpToOneMonthMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 bsac:Between1And3MonthMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 bsac:Between3And12MonthsMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 bsac:Between1And3YearsMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 bsac:Between3And5YearsMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 bsac:MoreThan5YearsMember ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 ifrs-full:FairValueHedgesMember 2022-12-31 0001027552 bsac:CurrencyForwardsMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 bsac:CurrencyForwardsMember bsac:Between1And3MonthMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 bsac:CurrencyForwardsMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 bsac:CurrencyForwardsMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 bsac:CurrencyForwardsMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 bsac:CurrencyForwardsMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between1And3MonthMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 bsac:Between1And3MonthMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 ifrs-full:CashFlowHedgesMember 2022-12-31 0001027552 bsac:UpToOneMonthMember 2022-12-31 0001027552 bsac:Between1And3MonthMember 2022-12-31 0001027552 bsac:Between3And12MonthsMember 2022-12-31 0001027552 bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:Between3And5YearsMember 2022-12-31 0001027552 bsac:MoreThan5YearsMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanSovereignBondsMember bsac:DemandMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanSovereignBondsMember bsac:UpToOneMonthMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanSovereignBondsMember bsac:Between1And3MonthsMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanSovereignBondsMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanSovereignBondsMember bsac:MoreThan5YearsMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanSovereignBondsMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:USTreasuryBondsMember bsac:DemandMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:USTreasuryBondsMember bsac:UpToOneMonthMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:USTreasuryBondsMember bsac:Between1And3MonthsMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:USTreasuryBondsMember bsac:Between3And12MonthsMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:USTreasuryBondsMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:USTreasuryBondsMember bsac:Between3And5YearsMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:USTreasuryBondsMember bsac:MoreThan5YearsMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:USTreasuryBondsMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember bsac:MoreThan5YearsMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:DemandMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:UpToOneMonthMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:Between1And3MonthsMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:Between3And12MonthsMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:Between3And5YearsMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:MoreThan5YearsMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsMember bsac:Between1And3MonthsMember 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsMember bsac:Between3And12MonthsMember 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsMember bsac:Between3And5YearsMember 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsMember bsac:MoreThan5YearsMember 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsMember 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:DemandMember 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:UpToOneMonthMember 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:Between1And3MonthsMember 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:MoreThan5YearsMember 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember 2023-12-31 0001027552 bsac:InterbankBorrowingMember bsac:ChileanCentralBankLoansMember bsac:DemandMember 2023-12-31 0001027552 bsac:InterbankBorrowingMember bsac:ChileanCentralBankLoansMember bsac:UpToOneMonthMember 2023-12-31 0001027552 bsac:InterbankBorrowingMember bsac:ChileanCentralBankLoansMember bsac:Between1And3MonthsMember 2023-12-31 0001027552 bsac:InterbankBorrowingMember bsac:ChileanCentralBankLoansMember bsac:Between3And12MonthsMember 2023-12-31 0001027552 bsac:InterbankBorrowingMember bsac:ChileanCentralBankLoansMember bsac:Between3And5YearsMember 2023-12-31 0001027552 bsac:InterbankBorrowingMember bsac:ChileanCentralBankLoansMember bsac:MoreThan5YearsMember 2023-12-31 0001027552 bsac:InterbankBorrowingMember bsac:ChileanCentralBankLoansMember 2023-12-31 0001027552 bsac:HedgedItemMember bsac:UpToOneMonthMember 2023-12-31 0001027552 bsac:HedgedItemMember bsac:Between1And3MonthsMember 2023-12-31 0001027552 bsac:HedgedItemMember bsac:Between3And12MonthsMember 2023-12-31 0001027552 bsac:HedgedItemMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:HedgedItemMember bsac:Between3And5YearsMember 2023-12-31 0001027552 bsac:HedgedItemMember bsac:MoreThan5YearsMember 2023-12-31 0001027552 bsac:HedgedItemMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:CrossCurrencySwapsMember bsac:UpToOneMonthMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:CrossCurrencySwapsMember bsac:Between1And3MonthsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:CrossCurrencySwapsMember bsac:Between3And12MonthsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:CrossCurrencySwapsMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:CrossCurrencySwapsMember bsac:Between3And5YearsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:CrossCurrencySwapsMember bsac:MoreThan5YearsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:CrossCurrencySwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:ForwardsMember bsac:UpToOneMonthMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:ForwardsMember bsac:Between1And3MonthsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:ForwardsMember bsac:Between3And12MonthsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:ForwardsMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:ForwardsMember bsac:Between3And5YearsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:ForwardsMember bsac:MoreThan5YearsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:ForwardsMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableAtAmortisedCostMember bsac:CommercialLoansMember bsac:DemandMember 2022-12-31 0001027552 bsac:LoansAndAccountReceivableAtAmortisedCostMember bsac:CommercialLoansMember bsac:Between3And12MonthsMember 2022-12-31 0001027552 bsac:LoansAndAccountReceivableAtAmortisedCostMember bsac:CommercialLoansMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:LoansAndAccountReceivableAtAmortisedCostMember bsac:CommercialLoansMember bsac:Between3And5YearsMember 2022-12-31 0001027552 bsac:LoansAndAccountReceivableAtAmortisedCostMember bsac:CommercialLoansMember bsac:MoreThan5YearsMember 2022-12-31 0001027552 bsac:LoansAndAccountReceivableAtAmortisedCostMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:USTreasuryBondsMember bsac:DemandMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:USTreasuryBondsMember bsac:UpToOneMonthMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:USTreasuryBondsMember bsac:Between1And3MonthsMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:USTreasuryBondsMember bsac:Between3And12MonthsMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:USTreasuryBondsMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:USTreasuryBondsMember bsac:Between3And5YearsMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:USTreasuryBondsMember bsac:MoreThan5YearsMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:USTreasuryBondsMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:DemandMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:UpToOneMonthMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:Between1And3MonthsMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:Between3And12MonthsMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:Between3And5YearsMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:MoreThan5YearsMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsMember bsac:DemandMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsMember bsac:UpToOneMonthMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsMember bsac:Between3And12MonthsMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsMember bsac:Between3And5YearsMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsMember bsac:MoreThan5YearsMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:DemandMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:UpToOneMonthMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:Between1And3MonthsMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:Between3And12MonthsMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:Between3And5YearsMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:MoreThan5YearsMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember 2022-12-31 0001027552 bsac:InterbankBorrowingMember bsac:InterbankLoansMember bsac:DemandMember 2022-12-31 0001027552 bsac:InterbankBorrowingMember bsac:InterbankLoansMember bsac:UpToOneMonthMember 2022-12-31 0001027552 bsac:InterbankBorrowingMember bsac:InterbankLoansMember bsac:Between1And3MonthsMember 2022-12-31 0001027552 bsac:InterbankBorrowingMember bsac:InterbankLoansMember bsac:Between3And12MonthsMember 2022-12-31 0001027552 bsac:InterbankBorrowingMember bsac:InterbankLoansMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:InterbankBorrowingMember bsac:InterbankLoansMember bsac:Between3And5YearsMember 2022-12-31 0001027552 bsac:InterbankBorrowingMember bsac:InterbankLoansMember bsac:MoreThan5YearsMember 2022-12-31 0001027552 bsac:InterbankBorrowingMember bsac:InterbankLoansMember 2022-12-31 0001027552 bsac:InterbankBorrowingMember bsac:ChileanCentralBankLoansMember bsac:DemandMember 2022-12-31 0001027552 bsac:InterbankBorrowingMember bsac:ChileanCentralBankLoansMember bsac:UpToOneMonthMember 2022-12-31 0001027552 bsac:InterbankBorrowingMember bsac:ChileanCentralBankLoansMember bsac:Between1And3MonthsMember 2022-12-31 0001027552 bsac:InterbankBorrowingMember bsac:ChileanCentralBankLoansMember bsac:Between3And12MonthsMember 2022-12-31 0001027552 bsac:InterbankBorrowingMember bsac:ChileanCentralBankLoansMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:InterbankBorrowingMember bsac:ChileanCentralBankLoansMember bsac:Between3And5YearsMember 2022-12-31 0001027552 bsac:InterbankBorrowingMember bsac:ChileanCentralBankLoansMember bsac:MoreThan5YearsMember 2022-12-31 0001027552 bsac:InterbankBorrowingMember bsac:ChileanCentralBankLoansMember 2022-12-31 0001027552 bsac:UpToOneMonthMember 2022-12-31 0001027552 bsac:Between1And3MonthsMember 2022-12-31 0001027552 bsac:Between3And12MonthsMember 2022-12-31 0001027552 bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:Between3And5YearsMember 2022-12-31 0001027552 bsac:MoreThan5YearsMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:CrossCurrencySwapsMember bsac:UpToOneMonthMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:CrossCurrencySwapsMember bsac:Between1And3MonthsMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:CrossCurrencySwapsMember bsac:Between3And12MonthsMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:CrossCurrencySwapsMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:CrossCurrencySwapsMember bsac:Between3And5YearsMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:CrossCurrencySwapsMember bsac:MoreThan5YearsMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:CrossCurrencySwapsMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:InterestRateSwapsMember bsac:UpToOneMonthMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:InterestRateSwapsMember bsac:Between1And3MonthsMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:InterestRateSwapsMember bsac:Between3And12MonthsMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:InterestRateSwapsMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:InterestRateSwapsMember bsac:Between3And5YearsMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:InterestRateSwapsMember bsac:MoreThan5YearsMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:InterestRateSwapsMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember bsac:TimeDepositsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:TimeDepositsMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:TimeDepositsMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:TimeDepositsMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:TimeDepositsMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:TimeDepositsMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:TimeDepositsMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:TimeDepositsMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:TimeDepositsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SubordinatedBondsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:InterbankBorrowingsMember bsac:InterbankLoansMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:InterbankBorrowingsMember bsac:InterbankLoansMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:InterbankBorrowingsMember bsac:InterbankLoansMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:InterbankBorrowingsMember bsac:InterbankLoansMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:InterbankBorrowingsMember bsac:InterbankLoansMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:InterbankBorrowingsMember bsac:InterbankLoansMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:InterbankBorrowingsMember bsac:InterbankLoansMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:InterbankBorrowingsMember bsac:InterbankLoansMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:HedgedItemMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:HedgedItemMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:HedgedItemMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:HedgedItemMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:HedgedItemMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:HedgedItemMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:HedgedItemMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:HedgedItemMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:HedgingInstrumentMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:HedgingInstrumentMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:HedgingInstrumentMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:HedgingInstrumentMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:HedgingInstrumentMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:HedgingInstrumentMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:HedgingInstrumentMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:HedgingInstrumentMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:CurrencyForwardsMember bsac:HedgingInstrumentMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:CurrencyForwardsMember bsac:HedgingInstrumentMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:CurrencyForwardsMember bsac:HedgingInstrumentMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:CurrencyForwardsMember bsac:HedgingInstrumentMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:CurrencyForwardsMember bsac:HedgingInstrumentMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:CurrencyForwardsMember bsac:HedgingInstrumentMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:CurrencyForwardsMember bsac:HedgingInstrumentMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:CurrencyForwardsMember bsac:HedgingInstrumentMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:HedgingInstrumentMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember bsac:ChileanTreasuryBondsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsfixedRateMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsfixedRateMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsfixedRateMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsfixedRateMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsfixedRateMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsfixedRateMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsfixedRateMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember bsac:SeniorBondsfixedRateMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:DemandMember 2022-01-01 2022-12-31 0001027552 bsac:UpToOneMonthMember 2022-01-01 2022-12-31 0001027552 bsac:Between1And3MonthsMember 2022-01-01 2022-12-31 0001027552 bsac:Between3And12MonthsMember 2022-01-01 2022-12-31 0001027552 bsac:Between1And3YearsMember 2022-01-01 2022-12-31 0001027552 bsac:Between3And5YearsMember 2022-01-01 2022-12-31 0001027552 bsac:MoreThan5YearsMember 2022-01-01 2022-12-31 0001027552 bsac:InterbankBorrowingsMember bsac:InterbankLoansMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:InterbankBorrowingsMember bsac:InterbankLoansMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:InterbankBorrowingsMember bsac:InterbankLoansMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:InterbankBorrowingsMember bsac:InterbankLoansMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:InterbankBorrowingsMember bsac:InterbankLoansMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:InterbankBorrowingsMember bsac:InterbankLoansMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:InterbankBorrowingsMember bsac:InterbankLoansMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:InterbankBorrowingsMember bsac:InterbankLoansMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:HedgedItemMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:HedgedItemMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:HedgedItemMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:HedgedItemMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:HedgedItemMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:HedgedItemMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:HedgedItemMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:HedgedItemMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 ifrs-full:CurrencySwapContractMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:CurrencyForwardsMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:CurrencyForwardsMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:CurrencyForwardsMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:CurrencyForwardsMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:CurrencyForwardsMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:CurrencyForwardsMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:CurrencyForwardsMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:DemandMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:UpToOneMonthMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between1And3MonthsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between3And12MonthsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between1And3YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between3And5YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:MoreThan5YearsMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:HedgingInstrumentMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgedItemInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgedItemInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthMember bsac:HedgedItemInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgedItemInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgedItemInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgedItemInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgedItemInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgedItemInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgedItemOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgedItemOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthMember bsac:HedgedItemOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgedItemOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgedItemOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgedItemOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgedItemOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgedItemOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgedItemNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgedItemNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthMember bsac:HedgedItemNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgedItemNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgedItemNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgedItemNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgedItemNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgedItemNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgingInstrumentInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgingInstrumentInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthMember bsac:HedgingInstrumentInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgingInstrumentInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgingInstrumentInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgingInstrumentInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgingInstrumentInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgingInstrumentInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgingInstrumentOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgingInstrumentOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthMember bsac:HedgingInstrumentOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgingInstrumentOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgingInstrumentOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgingInstrumentOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgingInstrumentOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgingInstrumentOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgingInstrumentNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgingInstrumentNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthMember bsac:HedgingInstrumentNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgingInstrumentNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgingInstrumentNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgingInstrumentNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgingInstrumentNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgingInstrumentNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgedItemInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgedItemInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthMember bsac:HedgedItemInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgedItemInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgedItemInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgedItemInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgedItemInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgedItemInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgedItemOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgedItemOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthMember bsac:HedgedItemOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgedItemOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgedItemOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgedItemOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgedItemOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgedItemOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgedItemNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgedItemNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthMember bsac:HedgedItemNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgedItemNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgedItemNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgedItemNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgedItemNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgedItemNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgingInstrumentInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgingInstrumentInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthMember bsac:HedgingInstrumentInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgingInstrumentInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgingInstrumentInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgingInstrumentInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgingInstrumentInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgingInstrumentInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgingInstrumentOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgingInstrumentOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthMember bsac:HedgingInstrumentOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgingInstrumentOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgingInstrumentOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgingInstrumentOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgingInstrumentOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgingInstrumentOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgingInstrumentNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgingInstrumentNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthMember bsac:HedgingInstrumentNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgingInstrumentNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgingInstrumentNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgingInstrumentNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgingInstrumentNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgingInstrumentNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgedItemInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgedItemOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgedItemNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgingInstrumentInflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgingInstrumentOutflowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgingInstrumentNetFlowsMember 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgedItemInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgedItemOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgedItemNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgingInstrumentInflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgingInstrumentOutflowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgingInstrumentNetFlowsMember 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgedItemInflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgedItemInflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgedItemInflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgedItemInflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgedItemInflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgedItemInflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgedItemInflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgedItemInflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgedItemOutflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgedItemOutflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgedItemOutflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgedItemOutflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgedItemOutflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgedItemOutflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgedItemOutflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgedItemOutflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgedItemNetFlowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgedItemNetFlowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgedItemNetFlowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgedItemNetFlowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgedItemNetFlowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgedItemNetFlowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgedItemNetFlowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgedItemNetFlowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgingInstrumentInflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgingInstrumentInflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgingInstrumentInflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgingInstrumentInflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgingInstrumentInflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgingInstrumentInflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgingInstrumentInflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgingInstrumentInflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgingInstrumentOutflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgingInstrumentOutflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgingInstrumentOutflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgingInstrumentOutflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgingInstrumentOutflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgingInstrumentOutflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgingInstrumentOutflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgingInstrumentOutflowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgingInstrumentNetFlowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgingInstrumentNetFlowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgingInstrumentNetFlowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgingInstrumentNetFlowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgingInstrumentNetFlowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgingInstrumentNetFlowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgingInstrumentNetFlowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgingInstrumentNetFlowsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgedItemInflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgedItemInflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgedItemInflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgedItemInflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgedItemInflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgedItemInflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgedItemInflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgedItemInflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgedItemOutflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgedItemOutflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgedItemOutflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgedItemOutflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgedItemOutflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgedItemOutflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgedItemOutflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgedItemOutflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgedItemNetFlowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgedItemNetFlowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgedItemNetFlowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgedItemNetFlowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgedItemNetFlowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgedItemNetFlowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgedItemNetFlowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgedItemNetFlowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgingInstrumentInflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgingInstrumentInflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgingInstrumentInflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgingInstrumentInflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgingInstrumentInflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgingInstrumentInflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgingInstrumentInflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgingInstrumentInflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgingInstrumentOutflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgingInstrumentOutflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgingInstrumentOutflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgingInstrumentOutflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgingInstrumentOutflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgingInstrumentOutflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgingInstrumentOutflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgingInstrumentOutflowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:DemandMember bsac:HedgingInstrumentNetFlowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:UpToOneMonthMember bsac:HedgingInstrumentNetFlowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3MonthsMember bsac:HedgingInstrumentNetFlowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And12MonthsMember bsac:HedgingInstrumentNetFlowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between1And3YearsMember bsac:HedgingInstrumentNetFlowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:Between3And5YearsMember bsac:HedgingInstrumentNetFlowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:MoreThan5YearsMember bsac:HedgingInstrumentNetFlowsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:InterestRateRiskMember bsac:HedgingInstrumentNetFlowsMember 2022-01-01 2022-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsCategoryMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsCategoryMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:BondHedgingDerivativesMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:BondHedgingDerivativesMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:BondHedgingDerivativesMember ifrs-full:CashFlowHedgesMember 2021-01-01 2021-12-31 0001027552 bsac:InterbankLoansHedgingDerivativesMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:InterbankLoansHedgingDerivativesMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:InterbankLoansHedgingDerivativesMember ifrs-full:CashFlowHedgesMember 2021-01-01 2021-12-31 0001027552 bsac:MortgageLoansHedgingDerivativesMember ifrs-full:CashFlowHedgesMember 2023-01-01 2023-12-31 0001027552 bsac:MortgageLoansHedgingDerivativesMember ifrs-full:CashFlowHedgesMember 2022-01-01 2022-12-31 0001027552 bsac:MortgageLoansHedgingDerivativesMember ifrs-full:CashFlowHedgesMember 2021-01-01 2021-12-31 0001027552 ifrs-full:CashFlowHedgesMember 2021-01-01 2021-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:DemandMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:UpToOneMonthMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between1And3MonthMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between3And12MonthsMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between1And3YearsMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between3And5YearsMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MoreThan5YearsMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:DemandMember bsac:CommercialLoansPortfolioMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:UpToOneMonthMember bsac:CommercialLoansPortfolioMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between1And3MonthMember bsac:CommercialLoansPortfolioMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between3And12MonthsMember bsac:CommercialLoansPortfolioMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between1And3YearsMember bsac:CommercialLoansPortfolioMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between3And5YearsMember bsac:CommercialLoansPortfolioMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MoreThan5YearsMember bsac:CommercialLoansPortfolioMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:CommercialLoansPortfolioMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:DemandMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:UpToOneMonthMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between1And3MonthMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between3And12MonthsMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between3And5YearsMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MoreThan5YearsMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:DemandMember bsac:CrossCurrencySwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:UpToOneMonthMember bsac:CrossCurrencySwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between1And3MonthMember bsac:CrossCurrencySwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between3And12MonthsMember bsac:CrossCurrencySwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between1And3YearsMember bsac:CrossCurrencySwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between3And5YearsMember bsac:CrossCurrencySwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:MoreThan5YearsMember bsac:CrossCurrencySwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:CrossCurrencySwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:DemandMember bsac:InterestRateSwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:UpToOneMonthMember bsac:InterestRateSwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between1And3MonthMember bsac:InterestRateSwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between3And12MonthsMember bsac:InterestRateSwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between1And3YearsMember bsac:InterestRateSwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between3And5YearsMember bsac:InterestRateSwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:MoreThan5YearsMember bsac:InterestRateSwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:InterestRateSwapsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:DemandMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:UpToOneMonthMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between1And3MonthMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between3And12MonthsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between3And5YearsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember bsac:MoreThan5YearsMember 2023-12-31 0001027552 bsac:HedgingInstrumentMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:DemandMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:UpToOneMonthMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between1And3MonthMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between3And12MonthsMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between1And3YearsMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between3And5YearsMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MoreThan5YearsMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:DemandMember bsac:CommercialLoansPortfolioMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:UpToOneMonthMember bsac:CommercialLoansPortfolioMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between1And3MonthMember bsac:CommercialLoansPortfolioMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between3And12MonthsMember bsac:CommercialLoansPortfolioMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between1And3YearsMember bsac:CommercialLoansPortfolioMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between3And5YearsMember bsac:CommercialLoansPortfolioMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MoreThan5YearsMember bsac:CommercialLoansPortfolioMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:CommercialLoansPortfolioMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:DemandMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:UpToOneMonthMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between1And3MonthMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between3And12MonthsMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:Between3And5YearsMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember bsac:MoreThan5YearsMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:DemandMember bsac:CrossCurrencySwapMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:UpToOneMonthMember bsac:CrossCurrencySwapMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between1And3MonthMember bsac:CrossCurrencySwapMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between3And12MonthsMember bsac:CrossCurrencySwapMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between1And3YearsMember bsac:CrossCurrencySwapMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between3And5YearsMember bsac:CrossCurrencySwapMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:MoreThan5YearsMember bsac:CrossCurrencySwapMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:CrossCurrencySwapMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:DemandMember bsac:nterestRateSwapMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:UpToOneMonthMember bsac:nterestRateSwapMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between1And3MonthMember bsac:nterestRateSwapMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between3And12MonthsMember bsac:nterestRateSwapMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between1And3YearsMember bsac:nterestRateSwapMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between3And5YearsMember bsac:nterestRateSwapMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:MoreThan5YearsMember bsac:nterestRateSwapMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:nterestRateSwapMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:DemandMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:UpToOneMonthMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between1And3MonthMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between3And12MonthsMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:Between3And5YearsMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember bsac:MoreThan5YearsMember 2022-12-31 0001027552 bsac:HedgingInstrumentMember 2022-12-31 0001027552 bsac:FinanceLeaseForRealEstateMember 2023-01-01 2023-12-31 0001027552 bsac:SignificantIncreaseInCreditRiskMember 2023-01-01 2023-12-31 0001027552 bsac:ORCriteriaMember 2023-01-01 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:ChileanCentralBankAndGovernmentSecuritiesMember 2023-01-01 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:ChileanCentralBankAndGovernmentSecuritiesMember 2022-01-01 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember 2023-01-01 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember 2022-01-01 2022-12-31 0001027552 bsac:InterbankLoansMember bsac:ForeignBanksMember 2023-01-01 2023-12-31 0001027552 bsac:InterbankLoansMember bsac:ForeignBanksMember 2022-01-01 2022-12-31 0001027552 bsac:InterbankLoansMember 2023-01-01 2023-12-31 0001027552 bsac:InterbankLoansMember 2022-01-01 2022-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember bsac:CommercialLoansMember 2023-01-01 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember bsac:CommercialLoansMember 2022-01-01 2022-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:MortgagesMember 2023-01-01 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:MortgagesMember 2022-01-01 2022-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:ConsumerLoansMember 2023-01-01 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:ConsumerLoansMember 2022-01-01 2022-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember 2023-01-01 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember 2022-01-01 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:ChileanCentralBankBondsMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:ChileanCentralBankBondsMember 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:ChileanCentralBankNotesMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:ChileanCentralBankNotesMember 2022-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:OtherChileanCentralBankAndGovernmentSecuritiesMember 2023-12-31 0001027552 bsac:ChileanCentralBankAndGovernmentSecuritiesMember bsac:OtherChileanCentralBankAndGovernmentSecuritiesMember 2022-12-31 0001027552 bsac:ForeignBanksMember bsac:Stage1Member bsac:InterbankLoansMember 2023-12-31 0001027552 bsac:ForeignBanksMember bsac:Stage2Member bsac:InterbankLoansMember 2023-12-31 0001027552 bsac:ForeignBanksMember bsac:StageThreeMember bsac:InterbankLoansMember 2023-12-31 0001027552 bsac:ForeignBanksMember bsac:InterbankLoansMember 2023-12-31 0001027552 bsac:ForeignBanksMember bsac:InterbankLoansMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:InterbankLoansMember 2023-12-31 0001027552 bsac:Stage2Member bsac:InterbankLoansMember 2023-12-31 0001027552 bsac:StageThreeMember bsac:InterbankLoansMember 2023-12-31 0001027552 bsac:InterbankLoansMember 2023-12-31 0001027552 bsac:InterbankLoansMember 2023-01-01 2023-12-31 0001027552 bsac:CommercialLoansPortfolioMember bsac:Stage1Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:CommercialLoansPortfolioMember bsac:Stage2Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:CommercialLoansPortfolioMember bsac:StageThreeMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:CommercialLoansPortfolioMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:CommercialLoansPortfolioMember bsac:CommercialLoansMember 2023-01-01 2023-12-31 0001027552 bsac:ForeignTradeLoansMember bsac:Stage1Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:ForeignTradeLoansMember bsac:Stage2Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:ForeignTradeLoansMember bsac:StageThreeMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:ForeignTradeLoansMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:ForeignTradeLoansMember bsac:CommercialLoansMember 2023-01-01 2023-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:Stage1Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:Stage2Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:StageThreeMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:CommercialLoansMember 2023-01-01 2023-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:Stage1Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:Stage2Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:StageThreeMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:CommercialLoansMember 2023-01-01 2023-12-31 0001027552 bsac:FactoringTransactionsMember bsac:Stage1Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:FactoringTransactionsMember bsac:Stage2Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:FactoringTransactionsMember bsac:StageThreeMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:FactoringTransactionsMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:FactoringTransactionsMember bsac:CommercialLoansMember 2023-01-01 2023-12-31 0001027552 bsac:LeasingTransactionsMember bsac:Stage1Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:LeasingTransactionsMember bsac:Stage2Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:LeasingTransactionsMember bsac:StageThreeMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:LeasingTransactionsMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:LeasingTransactionsMember bsac:CommercialLoansMember 2023-01-01 2023-12-31 0001027552 bsac:StudentLoansMember bsac:Stage1Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:StudentLoansMember bsac:Stage2Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:StudentLoansMember bsac:StageThreeMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:StudentLoansMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:StudentLoansMember bsac:CommercialLoansMember 2023-01-01 2023-12-31 0001027552 bsac:OtherLoansAndAccountReceivableMember bsac:Stage1Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:OtherLoansAndAccountReceivableMember bsac:Stage2Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:OtherLoansAndAccountReceivableMember bsac:StageThreeMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:OtherLoansAndAccountReceivableMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:OtherLoansAndAccountReceivableMember bsac:CommercialLoansMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:StageThreeMember bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:CommercialLoansMember 2023-01-01 2023-12-31 0001027552 bsac:LoansWithMortgageFinanceBondsMember bsac:Stage1Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:LoansWithMortgageFinanceBondsMember bsac:Stage2Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:LoansWithMortgageFinanceBondsMember bsac:StageThreeMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:LoansWithMortgageFinanceBondsMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:LoansWithMortgageFinanceBondsMember bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:EndorsableMortgageMutualLoansMember bsac:Stage1Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:EndorsableMortgageMutualLoansMember bsac:Stage2Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:EndorsableMortgageMutualLoansMember bsac:StageThreeMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:EndorsableMortgageMutualLoansMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:EndorsableMortgageMutualLoansMember bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:MortgageMutualFinancedWithMortgageBondsMember bsac:Stage1Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:MortgageMutualFinancedWithMortgageBondsMember bsac:Stage2Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:MortgageMutualFinancedWithMortgageBondsMember bsac:StageThreeMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:MortgageMutualFinancedWithMortgageBondsMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:MortgageMutualFinancedWithMortgageBondsMember bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:OtherMortgageMutualLoansMember bsac:Stage1Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:OtherMortgageMutualLoansMember bsac:Stage2Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:OtherMortgageMutualLoansMember bsac:StageThreeMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:OtherMortgageMutualLoansMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:OtherMortgageMutualLoansMember bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:OtherCreditAndAccountReceivableMember bsac:Stage1Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:OtherCreditAndAccountReceivableMember bsac:Stage2Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:OtherCreditAndAccountReceivableMember bsac:StageThreeMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:OtherCreditAndAccountReceivableMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:OtherCreditAndAccountReceivableMember bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member ifrs-full:MortgagesMember 2023-12-31 0001027552 bsac:Stage2Member ifrs-full:MortgagesMember 2023-12-31 0001027552 bsac:StageThreeMember ifrs-full:MortgagesMember 2023-12-31 0001027552 ifrs-full:MortgagesMember 2023-12-31 0001027552 ifrs-full:MortgagesMember 2023-01-01 2023-12-31 0001027552 bsac:InstallmentConsumerLoansMember bsac:Stage1Member bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:InstallmentConsumerLoansMember bsac:Stage2Member bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:InstallmentConsumerLoansMember bsac:StageThreeMember bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:InstallmentConsumerLoansMember bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:InstallmentConsumerLoansMember bsac:ConsumerLoansOneMember 2023-01-01 2023-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:Stage1Member bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:Stage2Member bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:StageThreeMember bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:ConsumerLoansOneMember 2023-01-01 2023-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:Stage1Member bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:Stage2Member bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:StageThreeMember bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:ConsumerLoansOneMember 2023-01-01 2023-12-31 0001027552 bsac:LeasingTransactionsMember bsac:Stage1Member bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:LeasingTransactionsMember bsac:Stage2Member bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:LeasingTransactionsMember bsac:StageThreeMember bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:LeasingTransactionsMember bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:LeasingTransactionsMember bsac:ConsumerLoansOneMember 2023-01-01 2023-12-31 0001027552 bsac:OtherConsumerLoansMember bsac:Stage1Member bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:OtherConsumerLoansMember bsac:Stage2Member bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:OtherConsumerLoansMember bsac:StageThreeMember bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:OtherConsumerLoansMember bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:OtherConsumerLoansMember bsac:ConsumerLoansOneMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:Stage2Member bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:StageThreeMember bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:ConsumerLoansOneMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember 2023-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember 2023-12-31 0001027552 bsac:StageThreeMember ifrs-full:ConsumerLoansMember 2023-12-31 0001027552 ifrs-full:ConsumerLoansMember 2023-12-31 0001027552 ifrs-full:ConsumerLoansMember 2023-01-01 2023-12-31 0001027552 bsac:ForeignBanksMember bsac:Stage1Member bsac:InterbankLoansMember 2022-12-31 0001027552 bsac:ForeignBanksMember bsac:Stage2Member bsac:InterbankLoansMember 2022-12-31 0001027552 bsac:ForeignBanksMember bsac:StageThreeMember bsac:InterbankLoansMember 2022-12-31 0001027552 bsac:ForeignBanksMember bsac:InterbankLoansMember 2022-12-31 0001027552 bsac:ForeignBanksMember bsac:InterbankLoansMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:InterbankLoansMember 2022-12-31 0001027552 bsac:Stage2Member bsac:InterbankLoansMember 2022-12-31 0001027552 bsac:StageThreeMember bsac:InterbankLoansMember 2022-12-31 0001027552 bsac:InterbankLoansMember 2022-12-31 0001027552 bsac:InterbankLoansMember 2022-01-01 2022-12-31 0001027552 bsac:CommercialLoansPortfolioMember bsac:Stage1Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:CommercialLoansPortfolioMember bsac:Stage2Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:CommercialLoansPortfolioMember bsac:StageThreeMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:CommercialLoansPortfolioMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:CommercialLoansPortfolioMember bsac:CommercialLoansMember 2022-01-01 2022-12-31 0001027552 bsac:ForeignTradeLoansMember bsac:Stage1Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:ForeignTradeLoansMember bsac:Stage2Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:ForeignTradeLoansMember bsac:StageThreeMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:ForeignTradeLoansMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:ForeignTradeLoansMember bsac:CommercialLoansMember 2022-01-01 2022-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:Stage1Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:Stage2Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:StageThreeMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:CommercialLoansMember 2022-01-01 2022-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:Stage1Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:Stage2Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:StageThreeMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:CommercialLoansMember 2022-01-01 2022-12-31 0001027552 bsac:FactoringTransactionsMember bsac:Stage1Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:FactoringTransactionsMember bsac:Stage2Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:FactoringTransactionsMember bsac:StageThreeMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:FactoringTransactionsMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:FactoringTransactionsMember bsac:CommercialLoansMember 2022-01-01 2022-12-31 0001027552 bsac:LeasingTransactionsMember bsac:Stage1Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:LeasingTransactionsMember bsac:Stage2Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:LeasingTransactionsMember bsac:StageThreeMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:LeasingTransactionsMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:LeasingTransactionsMember bsac:CommercialLoansMember 2022-01-01 2022-12-31 0001027552 bsac:StudentLoansMember bsac:Stage1Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:StudentLoansMember bsac:Stage2Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:StudentLoansMember bsac:StageThreeMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:StudentLoansMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:StudentLoansMember bsac:CommercialLoansMember 2022-01-01 2022-12-31 0001027552 bsac:OtherLoansAndAccountReceivableMember bsac:Stage1Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:OtherLoansAndAccountReceivableMember bsac:Stage2Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:OtherLoansAndAccountReceivableMember bsac:StageThreeMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:OtherLoansAndAccountReceivableMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:OtherLoansAndAccountReceivableMember bsac:CommercialLoansMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:StageThreeMember bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:CommercialLoansMember 2022-01-01 2022-12-31 0001027552 bsac:LoansWithMortgageFinanceBondsMember bsac:Stage1Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:LoansWithMortgageFinanceBondsMember bsac:Stage2Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:LoansWithMortgageFinanceBondsMember bsac:StageThreeMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:LoansWithMortgageFinanceBondsMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:LoansWithMortgageFinanceBondsMember bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:EndorsableMortgageMutualLoansMember bsac:Stage1Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:EndorsableMortgageMutualLoansMember bsac:Stage2Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:EndorsableMortgageMutualLoansMember bsac:StageThreeMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:EndorsableMortgageMutualLoansMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:EndorsableMortgageMutualLoansMember bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:MortgageMutualFinancedWithMortgageBondsMember bsac:Stage1Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:MortgageMutualFinancedWithMortgageBondsMember bsac:Stage2Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:MortgageMutualFinancedWithMortgageBondsMember bsac:StageThreeMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:MortgageMutualFinancedWithMortgageBondsMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:MortgageMutualFinancedWithMortgageBondsMember bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:OtherMortgageMutualLoansMember bsac:Stage1Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:OtherMortgageMutualLoansMember bsac:Stage2Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:OtherMortgageMutualLoansMember bsac:StageThreeMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:OtherMortgageMutualLoansMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:OtherMortgageMutualLoansMember bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:OtherCreditAndAccountReceivableMember bsac:Stage1Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:OtherCreditAndAccountReceivableMember bsac:Stage2Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:OtherCreditAndAccountReceivableMember bsac:StageThreeMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:OtherCreditAndAccountReceivableMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:OtherCreditAndAccountReceivableMember bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:Stage2Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:StageThreeMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:InstallmentConsumerLoansMember bsac:Stage1Member bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:InstallmentConsumerLoansMember bsac:Stage2Member bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:InstallmentConsumerLoansMember bsac:StageThreeMember bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:InstallmentConsumerLoansMember bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:InstallmentConsumerLoansMember bsac:ConsumerLoansOneMember 2022-01-01 2022-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:Stage1Member bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:Stage2Member bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:StageThreeMember bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:CheckingAccountsDebtorsMember bsac:ConsumerLoansOneMember 2022-01-01 2022-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:Stage1Member bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:Stage2Member bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:StageThreeMember bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:CreditCardDebtorsMember bsac:ConsumerLoansOneMember 2022-01-01 2022-12-31 0001027552 bsac:LeasingTransactionsMember bsac:Stage1Member bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:LeasingTransactionsMember bsac:Stage2Member bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:LeasingTransactionsMember bsac:StageThreeMember bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:LeasingTransactionsMember bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:LeasingTransactionsMember bsac:ConsumerLoansOneMember 2022-01-01 2022-12-31 0001027552 bsac:OtherConsumerLoansMember bsac:Stage1Member bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:OtherConsumerLoansMember bsac:Stage2Member bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:OtherConsumerLoansMember bsac:StageThreeMember bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:OtherConsumerLoansMember bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:OtherConsumerLoansMember bsac:ConsumerLoansOneMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:Stage2Member bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:StageThreeMember bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:ConsumerLoansOneMember 2022-01-01 2022-12-31 0001027552 bsac:InterbankLoansMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:CorporatesMember 2022-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:OtherCommercialMember 2022-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:CorporatesMember 2022-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:OtherCommercialMember 2022-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:CorporatesMember 2022-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:OtherCommercialMember 2022-12-31 0001027552 bsac:GrossCarryingValueMember 2022-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:CorporatesMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:OtherCommercialMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:CorporatesMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:OtherCommercialMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:CorporatesMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:OtherCommercialMember 2023-01-01 2023-12-31 0001027552 bsac:GrossCarryingValueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:CorporatesMember 2023-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:OtherCommercialMember 2023-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:CorporatesMember 2023-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:OtherCommercialMember 2023-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:CorporatesMember 2023-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:OtherCommercialMember 2023-12-31 0001027552 bsac:GrossCarryingValueMember 2023-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:CorporatesMember 2022-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:OtherCommercialMember 2022-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:CorporatesMember 2022-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:OtherCommercialMember 2022-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:CorporatesMember 2022-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:OtherCommercialMember 2022-12-31 0001027552 bsac:ECLAllowanceMember 2022-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:CorporatesMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:OtherCommercialMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:CorporatesMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:OtherCommercialMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:CorporatesMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:OtherCommercialMember 2023-01-01 2023-12-31 0001027552 bsac:ECLAllowanceMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:CorporatesMember 2023-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:OtherCommercialMember 2023-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:CorporatesMember 2023-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:OtherCommercialMember 2023-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:CorporatesMember 2023-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:OtherCommercialMember 2023-12-31 0001027552 bsac:ECLAllowanceMember 2023-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:CorporatesMember 2021-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:OtherCommercialMember 2021-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:CorporatesMember 2021-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:OtherCommercialMember 2021-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:CorporatesMember 2021-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:OtherCommercialMember 2021-12-31 0001027552 bsac:GrossCarryingValueMember 2021-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:CorporatesMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:OtherCommercialMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:CorporatesMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:OtherCommercialMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:CorporatesMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:OtherCommercialMember 2022-01-01 2022-12-31 0001027552 bsac:GrossCarryingValueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:CorporatesMember 2021-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:OtherCommercialMember 2021-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:CorporatesMember 2021-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:OtherCommercialMember 2021-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:CorporatesMember 2021-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:OtherCommercialMember 2021-12-31 0001027552 bsac:ECLAllowanceMember 2021-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:CorporatesMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:OtherCommercialMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:CorporatesMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:OtherCommercialMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:CorporatesMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:OtherCommercialMember 2022-01-01 2022-12-31 0001027552 bsac:ECLAllowanceMember 2022-01-01 2022-12-31 0001027552 bsac:CommercialLoan1Member 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesOtherCommercialMember 2022-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesOtherCommercialMember 2022-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesOtherCommercialMember 2022-12-31 0001027552 bsac:GrossCarryingValueMember bsac:CommercialLoanOneMember 2022-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesOtherCommercialMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesOtherCommercialMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesOtherCommercialMember 2023-01-01 2023-12-31 0001027552 bsac:GrossCarryingValueMember bsac:CommercialLoanOneMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesOtherCommercialMember 2023-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesOtherCommercialMember 2023-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesOtherCommercialMember 2023-12-31 0001027552 bsac:GrossCarryingValueMember bsac:CommercialLoanOneMember 2023-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesOtherCommercialMember 2022-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesOtherCommercialMember 2022-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesOtherCommercialMember 2022-12-31 0001027552 bsac:ECLAllowanceMember bsac:CommercialLoanOneMember 2022-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesOtherCommercialMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesOtherCommercialMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesOtherCommercialMember 2023-01-01 2023-12-31 0001027552 bsac:ECLAllowanceMember bsac:CommercialLoanOneMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesOtherCommercialMember 2023-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesOtherCommercialMember 2023-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesOtherCommercialMember 2023-12-31 0001027552 bsac:ECLAllowanceMember bsac:CommercialLoanOneMember 2023-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesCorporateAssessedMember 2021-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesOtherCommercialMember 2021-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesCorporateAssessedMember 2021-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesOtherCommercialMember 2021-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesCorporateAssessedMember 2021-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesOtherCommercialMember 2021-12-31 0001027552 bsac:GrossCarryingValueMember bsac:CommercialLoanOneMember 2021-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesOtherCommercialMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesOtherCommercialMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:GrossCarryingValueMember bsac:ExpectedCreditLossesOtherCommercialMember 2022-01-01 2022-12-31 0001027552 bsac:GrossCarryingValueMember bsac:CommercialLoanOneMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesCorporateAssessedMember 2021-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesOtherCommercialMember 2021-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesCorporateAssessedMember 2021-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesOtherCommercialMember 2021-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesCorporateAssessedMember 2021-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesOtherCommercialMember 2021-12-31 0001027552 bsac:ECLAllowanceMember bsac:CommercialLoanOneMember 2021-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesOtherCommercialMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesOtherCommercialMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:ECLAllowanceMember bsac:ExpectedCreditLossesOtherCommercialMember 2022-01-01 2022-12-31 0001027552 bsac:ECLAllowanceMember bsac:CommercialLoanOneMember 2022-01-01 2022-12-31 0001027552 ifrs-full:MortgagesMember 2023-01-01 2023-12-31 0001027552 bsac:GrossCarryingValueMember bsac:Stage1Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:GrossCarryingValueMember bsac:Stage2Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:GrossCarryingValueMember bsac:Stage3Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:GrossCarryingValueMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:GrossCarryingValueMember bsac:Stage1Member bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:GrossCarryingValueMember bsac:Stage2Member bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:GrossCarryingValueMember bsac:Stage3Member bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:GrossCarryingValueMember bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:GrossCarryingValueMember bsac:Stage1Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:GrossCarryingValueMember bsac:Stage2Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:GrossCarryingValueMember bsac:Stage3Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:GrossCarryingValueMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:ECLAllowanceMember bsac:Stage1Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:ECLAllowanceMember bsac:Stage2Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:ECLAllowanceMember bsac:Stage3Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:ECLAllowanceMember bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:ECLAllowanceMember bsac:Stage1Member bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:ECLAllowanceMember bsac:Stage2Member bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:ECLAllowanceMember bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:ECLAllowanceMember bsac:Stage3Member bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:ECLAllowanceMember bsac:Stage1Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:ECLAllowanceMember bsac:Stage2Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:ECLAllowanceMember bsac:Stage3Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:ECLAllowanceMember bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:GrossCarryingValueMember bsac:Stage1Member bsac:MortgageLoansMember 2021-12-31 0001027552 bsac:GrossCarryingValueMember bsac:Stage2Member bsac:MortgageLoansMember 2021-12-31 0001027552 bsac:GrossCarryingValueMember bsac:Stage3Member bsac:MortgageLoansMember 2021-12-31 0001027552 bsac:GrossCarryingValueMember bsac:MortgageLoansMember 2021-12-31 0001027552 bsac:GrossCarryingValueMember bsac:Stage1Member bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:GrossCarryingValueMember bsac:Stage2Member bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:GrossCarryingValueMember bsac:Stage3Member bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:GrossCarryingValueMember bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:ECLAllowanceMember bsac:Stage1Member bsac:MortgageLoansMember 2021-12-31 0001027552 bsac:ECLAllowanceMember bsac:Stage2Member bsac:MortgageLoansMember 2021-12-31 0001027552 bsac:ECLAllowanceMember bsac:Stage3Member bsac:MortgageLoansMember 2021-12-31 0001027552 bsac:ECLAllowanceMember bsac:MortgageLoansMember 2021-12-31 0001027552 bsac:ECLAllowanceMember bsac:Stage1Member bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:ECLAllowanceMember bsac:Stage2Member bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:ECLAllowanceMember bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:ECLAllowanceMember bsac:Stage3Member bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:CommercialLoans1Member 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-12-31 0001027552 ifrs-full:ConsumerLoansMember 2022-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:ExpectedCreditLossesCorporateAssessedMember 2023-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:ExpectedCreditLossesCorporateAssessedMember 2021-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:ExpectedCreditLossesCorporateAssessedMember 2021-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:ExpectedCreditLossesCorporateAssessedMember 2021-12-31 0001027552 ifrs-full:ConsumerLoansMember 2021-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:ExpectedCreditLossesCorporateAssessedMember 2022-01-01 2022-12-31 0001027552 ifrs-full:ConsumerLoansMember 2022-01-01 2022-12-31 0001027552 2021-04-01 2021-04-22 0001027552 2021-06-01 2021-06-22 0001027552 bsac:RedbancSAMember 2023-12-31 0001027552 bsac:RedbancSAMember 2022-12-31 0001027552 bsac:RedbancSAMember 2021-12-31 0001027552 bsac:TransbankSAMember 2023-12-31 0001027552 bsac:TransbankSAMember 2022-12-31 0001027552 bsac:TransbankSAMember 2021-12-31 0001027552 bsac:CentroDeCompensacinAutomatizadoSAMember 2023-12-31 0001027552 bsac:CentroDeCompensacinAutomatizadoSAMember 2022-12-31 0001027552 bsac:CentroDeCompensacinAutomatizadoSAMember 2021-12-31 0001027552 bsac:SociedadInterbancariaDeDepsitoDeValoresSAMember 2023-12-31 0001027552 bsac:SociedadInterbancariaDeDepsitoDeValoresSAMember 2022-12-31 0001027552 bsac:SociedadInterbancariaDeDepsitoDeValoresSAMember 2021-12-31 0001027552 bsac:CmaraCompensacinDeAltoValorSAMember 2023-12-31 0001027552 bsac:CmaraCompensacinDeAltoValorSAMember 2022-12-31 0001027552 bsac:CmaraCompensacinDeAltoValorSAMember 2021-12-31 0001027552 bsac:AdministradorFinancieroDelTransantiagoSAMember 2023-12-31 0001027552 bsac:AdministradorFinancieroDelTransantiagoSAMember 2022-12-31 0001027552 bsac:AdministradorFinancieroDelTransantiagoSAMember 2021-12-31 0001027552 bsac:ServiciosDeInfraestructuraDeMercadoOTCSAMember 2023-12-31 0001027552 bsac:ServiciosDeInfraestructuraDeMercadoOTCSAMember 2022-12-31 0001027552 bsac:ServiciosDeInfraestructuraDeMercadoOTCSAMember 2021-12-31 0001027552 bsac:SubtotalMember 2023-12-31 0001027552 bsac:SubtotalMember 2022-12-31 0001027552 bsac:SubtotalMember 2021-12-31 0001027552 bsac:SubtotalMember 2023-01-01 2023-12-31 0001027552 bsac:SubtotalMember 2022-01-01 2022-12-31 0001027552 bsac:SubtotalMember 2021-01-01 2021-12-31 0001027552 bsac:BladexMember 2023-12-31 0001027552 bsac:BladexMember 2022-12-31 0001027552 bsac:BladexMember 2021-12-31 0001027552 bsac:BladexMember 2023-01-01 2023-12-31 0001027552 bsac:BladexMember 2021-01-01 2021-12-31 0001027552 bsac:StockExchangesMember 2023-12-31 0001027552 bsac:StockExchangesMember 2022-12-31 0001027552 bsac:StockExchangesMember 2021-12-31 0001027552 bsac:StockExchangesMember 2023-01-01 2023-12-31 0001027552 bsac:StockExchangesMember 2022-01-01 2022-12-31 0001027552 bsac:StockExchangesMember 2021-01-01 2021-12-31 0001027552 bsac:AssociatedCompaniesMember 2023-12-31 0001027552 bsac:AssociatedCompaniesMember 2022-12-31 0001027552 bsac:AssociatedCompaniesMember 2021-12-31 0001027552 bsac:AssociatedCompaniesMember 2023-01-01 2023-12-31 0001027552 bsac:OtherMember 2023-12-31 0001027552 bsac:OtherMember 2022-12-31 0001027552 bsac:SociedadNexusSAMember 2023-12-31 0001027552 bsac:SociedadNexusSAMember 2023-01-01 2023-12-31 0001027552 bsac:SociedadNexusSAMember 2022-12-31 0001027552 bsac:SociedadNexusSAMember 2022-01-01 2022-12-31 0001027552 bsac:SociedadNexusSAMember 2021-12-31 0001027552 bsac:SociedadNexusSAMember 2021-01-01 2021-12-31 0001027552 bsac:SoftwareDevelopmentOneMember 2023-01-01 2023-12-31 0001027552 bsac:SoftwareDevelopmentOneMember 2022-12-31 0001027552 bsac:SoftwareDevelopmentOneMember 2023-12-31 0001027552 bsac:SoftwareDevelopmentOneMember 2022-01-01 2022-12-31 0001027552 bsac:SoftwareDevelopmentOneMember 2021-12-31 0001027552 bsac:SoftwareDevelopmentsMember 2022-12-31 0001027552 bsac:SoftwareDevelopmentsMember 2023-01-01 2023-12-31 0001027552 bsac:SoftwareDevelopmentsMember 2023-12-31 0001027552 bsac:SoftwareDevelopmentsMember 2021-12-31 0001027552 bsac:SoftwareDevelopmentsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:BuildingsMember 2023-12-31 0001027552 ifrs-full:GrossCarryingAmountMember ifrs-full:BuildingsMember 2023-12-31 0001027552 ifrs-full:AccumulatedDepreciationAndAmortisationMember ifrs-full:BuildingsMember 2023-12-31 0001027552 ifrs-full:LandMember 2023-12-31 0001027552 ifrs-full:GrossCarryingAmountMember ifrs-full:LandMember 2023-12-31 0001027552 ifrs-full:AccumulatedDepreciationAndAmortisationMember ifrs-full:LandMember 2023-12-31 0001027552 ifrs-full:OfficeEquipmentMember 2023-12-31 0001027552 ifrs-full:GrossCarryingAmountMember ifrs-full:OfficeEquipmentMember 2023-12-31 0001027552 ifrs-full:AccumulatedDepreciationAndAmortisationMember ifrs-full:OfficeEquipmentMember 2023-12-31 0001027552 bsac:OtherMember 2023-12-31 0001027552 ifrs-full:GrossCarryingAmountMember bsac:OtherMember 2023-12-31 0001027552 ifrs-full:AccumulatedDepreciationAndAmortisationMember bsac:OtherMember 2023-12-31 0001027552 ifrs-full:GrossCarryingAmountMember 2023-12-31 0001027552 ifrs-full:AccumulatedDepreciationAndAmortisationMember 2023-12-31 0001027552 ifrs-full:BuildingsMember 2022-12-31 0001027552 ifrs-full:GrossCarryingAmountMember ifrs-full:BuildingsMember 2022-12-31 0001027552 ifrs-full:AccumulatedDepreciationAndAmortisationMember ifrs-full:BuildingsMember 2022-12-31 0001027552 ifrs-full:LandMember 2022-12-31 0001027552 ifrs-full:GrossCarryingAmountMember ifrs-full:LandMember 2022-12-31 0001027552 ifrs-full:AccumulatedDepreciationAndAmortisationMember ifrs-full:LandMember 2022-12-31 0001027552 ifrs-full:OfficeEquipmentMember 2022-12-31 0001027552 ifrs-full:GrossCarryingAmountMember ifrs-full:OfficeEquipmentMember 2022-12-31 0001027552 ifrs-full:AccumulatedDepreciationAndAmortisationMember ifrs-full:OfficeEquipmentMember 2022-12-31 0001027552 bsac:OtherMember 2022-12-31 0001027552 ifrs-full:GrossCarryingAmountMember bsac:OtherMember 2022-12-31 0001027552 ifrs-full:AccumulatedDepreciationAndAmortisationMember bsac:OtherMember 2022-12-31 0001027552 ifrs-full:GrossCarryingAmountMember 2022-12-31 0001027552 ifrs-full:AccumulatedDepreciationAndAmortisationMember 2022-12-31 0001027552 bsac:OthersMember 2022-12-31 0001027552 ifrs-full:BuildingsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:LandMember 2023-01-01 2023-12-31 0001027552 ifrs-full:OfficeEquipmentMember 2023-01-01 2023-12-31 0001027552 bsac:OthersMember 2023-01-01 2023-12-31 0001027552 bsac:OthersMember 2023-12-31 0001027552 ifrs-full:BuildingsMember 2021-12-31 0001027552 ifrs-full:LandMember 2021-12-31 0001027552 ifrs-full:OfficeEquipmentMember 2021-12-31 0001027552 bsac:OthersMember 2021-12-31 0001027552 ifrs-full:BuildingsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:LandMember 2022-01-01 2022-12-31 0001027552 ifrs-full:OfficeEquipmentMember 2022-01-01 2022-12-31 0001027552 bsac:OthersMember 2022-01-01 2022-12-31 0001027552 bsac:OtherMember 2023-01-01 2023-12-31 0001027552 bsac:OtherMember 2021-12-31 0001027552 bsac:OtherMember 2022-01-01 2022-12-31 0001027552 ifrs-full:LandAndBuildingsMember 2023-12-31 0001027552 ifrs-full:LandAndBuildingsMember 2022-12-31 0001027552 ifrs-full:LandAndBuildingsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:LandAndBuildingsMember 2021-12-31 0001027552 ifrs-full:LandAndBuildingsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember 2023-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember 2022-12-31 0001027552 ifrs-full:NotLaterThanOneYearMember 2023-01-01 2023-12-31 0001027552 ifrs-full:NotLaterThanOneYearMember 2022-01-01 2022-12-31 0001027552 ifrs-full:LaterThanOneYearAndNotLaterThanTwoYearsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:LaterThanOneYearAndNotLaterThanTwoYearsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:LaterThanTwoYearsAndNotLaterThanThreeYearsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:LaterThanTwoYearsAndNotLaterThanThreeYearsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:LaterThanThreeYearsAndNotLaterThanFourYearsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:LaterThanThreeYearsAndNotLaterThanFourYearsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:LaterThanFourYearsAndNotLaterThanFiveYearsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:LaterThanFourYearsAndNotLaterThanFiveYearsMember 2022-01-01 2022-12-31 0001027552 ifrs-full:LaterThanFiveYearsMember 2023-01-01 2023-12-31 0001027552 ifrs-full:LaterThanFiveYearsMember 2022-01-01 2022-12-31 0001027552 bsac:ForwardsMember 2023-12-31 0001027552 bsac:ForwardsMember 2022-12-31 0001027552 bsac:SwapsMember 2023-12-31 0001027552 bsac:SwapsMember 2022-12-31 0001027552 bsac:OpcionesCallMember 2023-12-31 0001027552 bsac:OpcionesCallMember 2022-12-31 0001027552 bsac:OpcionesPutMember 2023-12-31 0001027552 bsac:OpcionesPutMember 2022-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:OnDemandMember 2023-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2023-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2023-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:LaterThanFiveYearsMember 2023-12-31 0001027552 bsac:CurrencyForwardsMember bsac:TotalMember 2023-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:AtFairValueMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:OnDemandMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanFiveYearsMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember bsac:TotalMember 2023-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:AtFairValueMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:OnDemandMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanFiveYearsMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember bsac:TotalMember 2023-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:AtFairValueMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:OnDemandMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanFiveYearsMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember bsac:TotalMember 2023-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:AtFairValueMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:OnDemandMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanFiveYearsMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember bsac:TotalMember 2023-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:AtFairValueMember 2023-12-31 0001027552 bsac:TotalMember 2023-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:OnDemandMember 2022-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2022-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2022-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:LaterThanFiveYearsMember 2022-12-31 0001027552 bsac:CurrencyForwardsMember bsac:TotalMember 2022-12-31 0001027552 bsac:CurrencyForwardsMember ifrs-full:AtFairValueMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:OnDemandMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:LaterThanFiveYearsMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember bsac:TotalMember 2022-12-31 0001027552 bsac:InterestRateSwapsMember ifrs-full:AtFairValueMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:OnDemandMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:LaterThanFiveYearsMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember bsac:TotalMember 2022-12-31 0001027552 bsac:CrossCurrencySwapsMember ifrs-full:AtFairValueMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:OnDemandMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:LaterThanFiveYearsMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember bsac:TotalMember 2022-12-31 0001027552 bsac:CallCurrencyOptionsMember ifrs-full:AtFairValueMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:OnDemandMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanSixMonthsAndNotLaterThanOneYearMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanOneYearAndNotLaterThanThreeYearsMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:LaterThanFiveYearsMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember bsac:TotalMember 2022-12-31 0001027552 bsac:PutCurrencyOptionsMember ifrs-full:AtFairValueMember 2022-12-31 0001027552 bsac:TotalMember 2022-12-31 0001027552 ifrs-full:BottomOfRangeMember 2023-01-01 2023-12-31 0001027552 bsac:CheckingAccountsMember 2023-12-31 0001027552 bsac:CheckingAccountsMember 2022-12-31 0001027552 bsac:DemandAccountsAccountsMember 2023-12-31 0001027552 bsac:DemandAccountsAccountsMember 2022-12-31 0001027552 bsac:OtherDemandDepositsMember 2023-12-31 0001027552 bsac:OtherDemandDepositsMember 2022-12-31 0001027552 bsac:ObligationRelatedToPaymentsCardsProvisionMember 2023-12-31 0001027552 bsac:ObligationRelatedToPaymentsCardsProvisionMember 2022-12-31 0001027552 bsac:OtherDemandLiabilitiesMember 2023-12-31 0001027552 bsac:OtherDemandLiabilitiesMember 2022-12-31 0001027552 bsac:TimeDepositsMember 2023-12-31 0001027552 bsac:TimeDepositsMember 2022-12-31 0001027552 bsac:TimeSavingsAccountMember 2023-12-31 0001027552 bsac:TimeSavingsAccountMember 2022-12-31 0001027552 bsac:OtherTimeLiabilitiesMember 2023-12-31 0001027552 bsac:OtherTimeLiabilitiesMember 2022-12-31 0001027552 bsac:OperationWithForeignBanksMember 2023-01-01 2023-12-31 0001027552 bsac:OperationWithForeignBanksMember 2022-01-01 2022-12-31 0001027552 bsac:OperationWithOtherChileanEntitiesMember 2023-01-01 2023-12-31 0001027552 bsac:OperationWithOtherChileanEntitiesMember 2022-01-01 2022-12-31 0001027552 bsac:chileanFinancialInstitutionsMember 2023-12-31 0001027552 bsac:chileanFinancialInstitutionsMember 2022-12-31 0001027552 bsac:ForeignFinancialInstitutionsMember 2023-12-31 0001027552 bsac:ForeignFinancialInstitutionsMember 2022-12-31 0001027552 bsac:ChileanCentralBankMember 2023-12-31 0001027552 bsac:ChileanCentralBankMember 2022-12-31 0001027552 bsac:MortgageFinanceBondsMember 2023-12-31 0001027552 bsac:MortgageFinanceBondsMember 2022-12-31 0001027552 bsac:SeniorBondsMember 2023-12-31 0001027552 bsac:SeniorBondsMember 2022-12-31 0001027552 bsac:MortgageBondsMember 2023-12-31 0001027552 bsac:MortgageBondsMember 2022-12-31 0001027552 bsac:OtherDomesticObligationsMember 2023-12-31 0001027552 bsac:OtherDomesticObligationsMember 2022-12-31 0001027552 bsac:ForeignObligationsMember 2022-12-31 0001027552 bsac:ChileanTreasuryBondsAndNotesMember bsac:From1DayToLessThan3MonthsMember 2023-12-31 0001027552 bsac:ChileanTreasuryBondsAndNotesMember bsac:MoreThan3MonthsAndLessThan1YearMember 2023-12-31 0001027552 bsac:ChileanTreasuryBondsAndNotesMember bsac:MoreThan1YearMember 2023-12-31 0001027552 bsac:ChileanTreasuryBondsAndNotesMember 2023-12-31 0001027552 bsac:ChileanTreasuryBondsAndNotesMember bsac:From1DayToLessThan3MonthsMember 2022-12-31 0001027552 bsac:ChileanTreasuryBondsAndNotesMember bsac:MoreThan3MonthsAndLessThan1YearMember 2022-12-31 0001027552 bsac:ChileanTreasuryBondsAndNotesMember bsac:MoreThan1YearMember 2022-12-31 0001027552 bsac:ChileanTreasuryBondsAndNotesMember 2022-12-31 0001027552 bsac:From1DayToLessThan3MonthsMember 2023-12-31 0001027552 bsac:MoreThan3MonthsAndLessThan1YearMember 2023-12-31 0001027552 bsac:MoreThan1YearMember 2023-12-31 0001027552 bsac:From1DayToLessThan3MonthsMember 2022-12-31 0001027552 bsac:MoreThan3MonthsAndLessThan1YearMember 2022-12-31 0001027552 bsac:MoreThan1YearMember 2022-12-31 0001027552 bsac:ChileanBankDebtFinancialInstrumentsMember bsac:From1DayToLessThan3MonthsMember 2023-12-31 0001027552 bsac:ChileanBankDebtFinancialInstrumentsMember bsac:MoreThan3MonthsAndLessThan1YearMember 2023-12-31 0001027552 bsac:ChileanBankDebtFinancialInstrumentsMember bsac:MoreThan1YearMember 2023-12-31 0001027552 bsac:ChileanBankDebtFinancialInstrumentsMember 2023-12-31 0001027552 bsac:ChileanBankDebtFinancialInstrumentsMember bsac:From1DayToLessThan3MonthsMember 2022-12-31 0001027552 bsac:ChileanBankDebtFinancialInstrumentsMember bsac:MoreThan3MonthsAndLessThan1YearMember 2022-12-31 0001027552 bsac:ChileanBankDebtFinancialInstrumentsMember bsac:MoreThan1YearMember 2022-12-31 0001027552 bsac:ChileanBankDebtFinancialInstrumentsMember 2022-12-31 0001027552 bsac:OtherForeignDebtFinancialInstrumentsMember bsac:MoreThan3MonthsAndLessThan1YearMember 2023-12-31 0001027552 bsac:OtherForeignDebtFinancialInstrumentsMember bsac:MoreThan1YearMember 2023-12-31 0001027552 bsac:OtherForeignDebtFinancialInstrumentsMember 2023-12-31 0001027552 bsac:OtherForeignDebtFinancialInstrumentsMember bsac:From1DayToLessThan3MonthsMember 2022-12-31 0001027552 bsac:OtherForeignDebtFinancialInstrumentsMember bsac:MoreThan3MonthsAndLessThan1YearMember 2022-12-31 0001027552 bsac:OtherForeignDebtFinancialInstrumentsMember bsac:MoreThan1YearMember 2022-12-31 0001027552 bsac:OtherForeignDebtFinancialInstrumentsMember 2022-12-31 0001027552 bsac:From1DayToLessThan3MonthsMember 2023-01-01 2023-12-31 0001027552 bsac:MoreThan3MonthsAndLessThan1YearMember 2023-01-01 2023-12-31 0001027552 bsac:MoreThan1YearMember 2023-01-01 2023-12-31 0001027552 bsac:From1DayToLessThan3MonthsMember 2022-01-01 2022-12-31 0001027552 bsac:MoreThan3MonthsAndLessThan1YearMember 2022-01-01 2022-12-31 0001027552 bsac:MoreThan1YearMember 2022-01-01 2022-12-31 0001027552 bsac:StateBankOfIndiaMember 2023-01-01 2023-12-31 0001027552 bsac:StateBankOfIndiaMember 2022-01-01 2022-12-31 0001027552 bsac:WellsFargoBankNAMember 2023-01-01 2023-12-31 0001027552 bsac:WellsFargoBankNAMember 2022-01-01 2022-12-31 0001027552 bsac:SumitomoMitsuiBankingCorporationMember 2023-01-01 2023-12-31 0001027552 bsac:SumitomoMitsuiBankingCorporationMember 2022-01-01 2022-12-31 0001027552 bsac:CitibankNAMember 2023-01-01 2023-12-31 0001027552 bsac:CitibankNAMember 2022-01-01 2022-12-31 0001027552 bsac:BankOfAmericaMember 2023-01-01 2023-12-31 0001027552 bsac:BankOfAmericaMember 2022-01-01 2022-12-31 0001027552 bsac:StandardCharteredBankSingapurMember 2023-01-01 2023-12-31 0001027552 bsac:StandardCharteredBankSingapurMember 2022-01-01 2022-12-31 0001027552 bsac:TheBankOfNewYorkMellonMember 2023-01-01 2023-12-31 0001027552 bsac:TheBankOfNewYorkMellonMember 2022-01-01 2022-12-31 0001027552 bsac:InternationalFinanceCorporateMember 2023-01-01 2023-12-31 0001027552 bsac:InternationalFinanceCorporateMember 2022-01-01 2022-12-31 0001027552 bsac:CommerzbankAgMember 2023-01-01 2023-12-31 0001027552 bsac:CommerzbankAgMember 2022-01-01 2022-12-31 0001027552 bsac:TheTorontoDominionBankMember 2023-01-01 2023-12-31 0001027552 bsac:TheTorontoDominionBankMember 2022-01-01 2022-12-31 0001027552 bsac:BarclaysBankPlcLondonMember 2023-01-01 2023-12-31 0001027552 bsac:BarclaysBankPlcLondonMember 2022-01-01 2022-12-31 0001027552 bsac:ZurcherKantonalbankMember 2023-01-01 2023-12-31 0001027552 bsac:ZurcherKantonalbankMember 2022-01-01 2022-12-31 0001027552 bsac:HongKongAndShanghaiBankingMember 2023-01-01 2023-12-31 0001027552 bsac:HongKongAndShanghaiBankingMember 2022-01-01 2022-12-31 0001027552 bsac:BancoBilbaoVizcayaArgentariaMember 2023-01-01 2023-12-31 0001027552 bsac:BancoBilbaoVizcayaArgentariaMember 2022-01-01 2022-12-31 0001027552 bsac:SaudiNationalBankMember 2023-01-01 2023-12-31 0001027552 bsac:SaudiNationalBankMember 2022-01-01 2022-12-31 0001027552 bsac:BankOfBarodaMember 2023-01-01 2023-12-31 0001027552 bsac:BankOfBarodaMember 2022-01-01 2022-12-31 0001027552 bsac:BayerischeLandesbankAgMunicMember 2023-01-01 2023-12-31 0001027552 bsac:BayerischeLandesbankAgMunicMember 2022-01-01 2022-12-31 0001027552 bsac:TheBankOfMontrealMember 2023-01-01 2023-12-31 0001027552 bsac:TheBankOfMontrealMember 2022-01-01 2022-12-31 0001027552 bsac:CorporacionAndinaDeFomentoMember 2023-01-01 2023-12-31 0001027552 bsac:CorporacionAndinaDeFomentoMember 2022-01-01 2022-12-31 0001027552 bsac:BancoSantanderSingapurMember 2023-01-01 2023-12-31 0001027552 bsac:BancoSantanderSingapurMember 2022-01-01 2022-12-31 0001027552 bsac:StandardCharteredBankNewYorkMember 2023-01-01 2023-12-31 0001027552 bsac:StandardCharteredBankNewYorkMember 2022-01-01 2022-12-31 0001027552 bsac:BancoSantanderHongKongMember 2023-01-01 2023-12-31 0001027552 bsac:BancoSantanderHongKongMember 2022-01-01 2022-12-31 0001027552 bsac:AbancaCorporacionBancariaSAMember 2023-01-01 2023-12-31 0001027552 bsac:AbancaCorporacionBancariaSAMember 2022-01-01 2022-12-31 0001027552 bsac:TaishinInternationalBankCoMember 2023-01-01 2023-12-31 0001027552 bsac:TaishinInternationalBankCoMember 2022-01-01 2022-12-31 0001027552 bsac:StandardCharteredBankHongKongMember 2023-01-01 2023-12-31 0001027552 bsac:StandardCharteredBankHongKongMember 2022-01-01 2022-12-31 0001027552 bsac:KoreaExchangeBankMember 2023-01-01 2023-12-31 0001027552 bsac:KoreaExchangeBankMember 2022-01-01 2022-12-31 0001027552 bsac:BancoSantanderCentralHispanoMember 2023-01-01 2023-12-31 0001027552 bsac:BancoSantanderCentralHispanoMember 2022-01-01 2022-12-31 0001027552 bsac:StandardCharteredBankMember 2023-01-01 2023-12-31 0001027552 bsac:StandardCharteredBankMember 2022-01-01 2022-12-31 0001027552 bsac:BankOfChinaMember 2023-01-01 2023-12-31 0001027552 bsac:BankOfChinaMember 2022-01-01 2022-12-31 0001027552 bsac:AgriculturalBankOfChinaMember 2023-01-01 2023-12-31 0001027552 bsac:AgriculturalBankOfChinaMember 2022-01-01 2022-12-31 0001027552 bsac:BankOfTokioMitsubishiMember 2023-01-01 2023-12-31 0001027552 bsac:BankOfTokioMitsubishiMember 2022-01-01 2022-12-31 0001027552 bsac:KomercniBankaASMember 2023-01-01 2023-12-31 0001027552 bsac:KomercniBankaASMember 2022-01-01 2022-12-31 0001027552 bsac:AustralianAndNewZelandBankingGroupLtdMember 2023-01-01 2023-12-31 0001027552 bsac:AustralianAndNewZelandBankingGroupLtdMember 2022-01-01 2022-12-31 0001027552 bsac:HSBCBankPlcMember 2023-01-01 2023-12-31 0001027552 bsac:HSBCBankPlcMember 2022-01-01 2022-12-31 0001027552 bsac:ChinaConstructionBankMember 2023-01-01 2023-12-31 0001027552 bsac:ChinaConstructionBankMember 2022-01-01 2022-12-31 0001027552 bsac:BancaIntesaSPAMember 2023-01-01 2023-12-31 0001027552 bsac:BancaIntesaSPAMember 2022-01-01 2022-12-31 0001027552 bsac:BancoDoBrasilMember 2023-01-01 2023-12-31 0001027552 bsac:BancoDoBrasilMember 2022-01-01 2022-12-31 0001027552 bsac:WachoviaBankNAMember 2023-01-01 2023-12-31 0001027552 bsac:WachoviaBankNAMember 2022-01-01 2022-12-31 0001027552 bsac:BBVABancomerMember 2023-01-01 2023-12-31 0001027552 bsac:BBVABancomerMember 2022-01-01 2022-12-31 0001027552 bsac:BangkokBankPublicCompanyLimitedMember 2023-01-01 2023-12-31 0001027552 bsac:BangkokBankPublicCompanyLimitedMember 2022-01-01 2022-12-31 0001027552 bsac:HuaNanCommercialBankMember 2023-01-01 2023-12-31 0001027552 bsac:HuaNanCommercialBankMember 2022-01-01 2022-12-31 0001027552 bsac:ChinaMerchantsBankMember 2023-01-01 2023-12-31 0001027552 bsac:ChinaMerchantsBankMember 2022-01-01 2022-12-31 0001027552 bsac:CassaDiRisparmioDiMember 2023-01-01 2023-12-31 0001027552 bsac:CassaDiRisparmioDiMember 2022-01-01 2022-12-31 0001027552 bsac:IciciBankLimitedMember 2023-01-01 2023-12-31 0001027552 bsac:IciciBankLimitedMember 2022-01-01 2022-12-31 0001027552 bsac:IndustrialAndCommercialBankMember 2023-01-01 2023-12-31 0001027552 bsac:IndustrialAndCommercialBankMember 2022-01-01 2022-12-31 0001027552 bsac:ESunCommercialBankLtdMember 2023-01-01 2023-12-31 0001027552 bsac:ESunCommercialBankLtdMember 2022-01-01 2022-12-31 0001027552 bsac:TheIndustrialAndCommercialMember 2023-01-01 2023-12-31 0001027552 bsac:TheIndustrialAndCommercialMember 2022-01-01 2022-12-31 0001027552 exch:BSAB 2023-01-01 2023-12-31 0001027552 exch:BSAB 2022-01-01 2022-12-31 0001027552 bsac:BankOfCommunicationsMember 2023-01-01 2023-12-31 0001027552 bsac:BankOfCommunicationsMember 2022-01-01 2022-12-31 0001027552 bsac:TurkiyeIsBankasiMember 2023-01-01 2023-12-31 0001027552 bsac:TurkiyeIsBankasiMember 2022-01-01 2022-12-31 0001027552 bsac:RhbBankBerhadMember 2023-01-01 2023-12-31 0001027552 bsac:RhbBankBerhadMember 2022-01-01 2022-12-31 0001027552 bsac:ExportImportBankOfThailandMember 2023-01-01 2023-12-31 0001027552 bsac:ExportImportBankOfThailandMember 2022-01-01 2022-12-31 0001027552 bsac:BancoRioDeLaPlataSAMember 2023-01-01 2023-12-31 0001027552 bsac:BancoRioDeLaPlataSAMember 2022-01-01 2022-12-31 0001027552 bsac:BankOfIndiaMember 2023-01-01 2023-12-31 0001027552 bsac:BankOfIndiaMember 2022-01-01 2022-12-31 0001027552 bsac:FinansbankASMember 2023-01-01 2023-12-31 0001027552 bsac:FinansbankASMember 2022-01-01 2022-12-31 0001027552 bsac:CiticIndustrialBankMember 2023-01-01 2023-12-31 0001027552 bsac:CiticIndustrialBankMember 2022-01-01 2022-12-31 0001027552 bsac:ShinhanBankMember 2023-01-01 2023-12-31 0001027552 bsac:ShinhanBankMember 2022-01-01 2022-12-31 0001027552 bsac:BancoBilbaoVizcayaMadridMember 2023-01-01 2023-12-31 0001027552 bsac:BancoBilbaoVizcayaMadridMember 2022-01-01 2022-12-31 0001027552 bsac:YapiVeKrediBankasiMember 2023-01-01 2023-12-31 0001027552 bsac:YapiVeKrediBankasiMember 2022-01-01 2022-12-31 0001027552 bsac:SvenkaHandelsbankenEstocolmoMember 2023-01-01 2023-12-31 0001027552 bsac:SvenkaHandelsbankenEstocolmoMember 2022-01-01 2022-12-31 0001027552 bsac:TheBankOfNovaScotiaMember 2023-01-01 2023-12-31 0001027552 bsac:TheBankOfNovaScotiaMember 2022-01-01 2022-12-31 0001027552 bsac:BancoItauBrasilMember 2023-01-01 2023-12-31 0001027552 bsac:BancoItauBrasilMember 2022-01-01 2022-12-31 0001027552 bsac:IndustrialBankOfKoreaMember 2023-01-01 2023-12-31 0001027552 bsac:IndustrialBankOfKoreaMember 2022-01-01 2022-12-31 0001027552 bsac:ShanghaiPudongDevelopmentBankMember 2023-01-01 2023-12-31 0001027552 bsac:ShanghaiPudongDevelopmentBankMember 2022-01-01 2022-12-31 0001027552 bsac:BankOfTaiwanTaipeiMember 2023-01-01 2023-12-31 0001027552 bsac:BankOfTaiwanTaipeiMember 2022-01-01 2022-12-31 0001027552 bsac:KbcBankNvMember 2023-01-01 2023-12-31 0001027552 bsac:KbcBankNvMember 2022-01-01 2022-12-31 0001027552 bsac:BancaNazionaleDelLavoroMember 2023-01-01 2023-12-31 0001027552 bsac:BancaNazionaleDelLavoroMember 2022-01-01 2022-12-31 0001027552 bsac:UnicreditMember 2023-01-01 2023-12-31 0001027552 bsac:UnicreditMember 2022-01-01 2022-12-31 0001027552 bsac:BBVAUruguayMember 2023-01-01 2023-12-31 0001027552 bsac:BBVAUruguayMember 2022-01-01 2022-12-31 0001027552 bsac:BankForForeignTradeOfVietnamMember 2023-01-01 2023-12-31 0001027552 bsac:BankForForeignTradeOfVietnamMember 2022-01-01 2022-12-31 0001027552 bsac:IntesaSanpaoloMember 2023-01-01 2023-12-31 0001027552 bsac:IntesaSanpaoloMember 2022-01-01 2022-12-31 0001027552 bsac:FortisBankMember 2023-01-01 2023-12-31 0001027552 bsac:FortisBankMember 2022-01-01 2022-12-31 0001027552 bsac:CreditAgricoleReimsMember 2023-01-01 2023-12-31 0001027552 bsac:CreditAgricoleReimsMember 2022-01-01 2022-12-31 0001027552 bsac:CaixabankMember 2023-01-01 2023-12-31 0001027552 bsac:CaixabankMember 2022-01-01 2022-12-31 0001027552 bsac:TaiwanCooperativeBankMember 2023-01-01 2023-12-31 0001027552 bsac:TaiwanCooperativeBankMember 2022-01-01 2022-12-31 0001027552 bsac:BancoItauBbaSAMember 2023-01-01 2023-12-31 0001027552 bsac:BancoItauBbaSAMember 2022-01-01 2022-12-31 0001027552 bsac:AbnAmroBankNVMember 2023-01-01 2023-12-31 0001027552 bsac:AbnAmroBankNVMember 2022-01-01 2022-12-31 0001027552 bsac:KotakMahindraBankLimitedMember 2023-01-01 2023-12-31 0001027552 bsac:KotakMahindraBankLimitedMember 2022-01-01 2022-12-31 0001027552 bsac:BancoCredicoopCooperativoMember 2023-01-01 2023-12-31 0001027552 bsac:BancoCredicoopCooperativoMember 2022-01-01 2022-12-31 0001027552 bsac:SubtotalTwoMember 2023-01-01 2023-12-31 0001027552 bsac:SubtotalTwoMember 2022-01-01 2022-12-31 0001027552 bsac:ChileanCentralBankMember bsac:DueWithin1YearMember 2023-12-31 0001027552 bsac:ChileanCentralBankMember bsac:DueWithin1YearMember 2022-12-31 0001027552 bsac:ChileanCentralBankMember bsac:DueAfter1YearButWithin2YearsMember 2023-12-31 0001027552 bsac:ChileanCentralBankMember bsac:DueAfter1YearButWithin2YearsMember 2022-12-31 0001027552 bsac:ChileanCentralBankMember bsac:DueAfter2YearsButWithin3YearsMember 2023-12-31 0001027552 bsac:ChileanCentralBankMember bsac:DueAfter2YearsButWithin3YearsMember 2022-12-31 0001027552 bsac:ChileanCentralBankMember bsac:DueAfter3YearsButWithin4YearsMember 2023-12-31 0001027552 bsac:ChileanCentralBankMember bsac:DueAfter3YearsButWithin4YearsMember 2022-12-31 0001027552 bsac:ChileanCentralBankMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:ChileanCentralBankMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:ChileanCentralBankMember 2023-12-31 0001027552 bsac:ChileanCentralBankMember 2022-12-31 0001027552 bsac:chileanFinancialInstitutionsMember bsac:DueWithin1YearMember 2023-12-31 0001027552 bsac:chileanFinancialInstitutionsMember bsac:DueWithin1YearMember 2022-12-31 0001027552 bsac:chileanFinancialInstitutionsMember bsac:DueAfter1YearButWithin2YearsMember 2023-12-31 0001027552 bsac:chileanFinancialInstitutionsMember bsac:DueAfter1YearButWithin2YearsMember 2022-12-31 0001027552 bsac:chileanFinancialInstitutionsMember bsac:DueAfter2YearsButWithin3YearsMember 2023-12-31 0001027552 bsac:chileanFinancialInstitutionsMember bsac:DueAfter2YearsButWithin3YearsMember 2022-12-31 0001027552 bsac:chileanFinancialInstitutionsMember bsac:DueAfter3YearsButWithin4YearsMember 2023-12-31 0001027552 bsac:chileanFinancialInstitutionsMember bsac:DueAfter3YearsButWithin4YearsMember 2022-12-31 0001027552 bsac:chileanFinancialInstitutionsMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:chileanFinancialInstitutionsMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:chileanFinancialInstitutionsMember 2023-12-31 0001027552 bsac:chileanFinancialInstitutionsMember 2022-12-31 0001027552 bsac:ForeignFinancialInstitutionsMember bsac:DueWithin1YearMember 2023-12-31 0001027552 bsac:ForeignFinancialInstitutionsMember bsac:DueWithin1YearMember 2022-12-31 0001027552 bsac:ForeignFinancialInstitutionsMember bsac:DueAfter1YearButWithin2YearsMember 2023-12-31 0001027552 bsac:ForeignFinancialInstitutionsMember bsac:DueAfter1YearButWithin2YearsMember 2022-12-31 0001027552 bsac:ForeignFinancialInstitutionsMember bsac:DueAfter2YearsButWithin3YearsMember 2023-12-31 0001027552 bsac:ForeignFinancialInstitutionsMember bsac:DueAfter2YearsButWithin3YearsMember 2022-12-31 0001027552 bsac:ForeignFinancialInstitutionsMember bsac:DueAfter3YearsButWithin4YearsMember 2023-12-31 0001027552 bsac:ForeignFinancialInstitutionsMember bsac:DueAfter3YearsButWithin4YearsMember 2022-12-31 0001027552 bsac:ForeignFinancialInstitutionsMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:ForeignFinancialInstitutionsMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:MortgageFinanceBondsMember 2023-01-01 2023-12-31 0001027552 bsac:MortgageFinanceBondsMember 2023-12-31 0001027552 bsac:MortgageFinanceBondsMember 2022-01-01 2022-12-31 0001027552 bsac:MortgageFinanceBondsMember 2022-12-31 0001027552 bsac:SeniorBondsMember 2023-01-01 2023-12-31 0001027552 bsac:SeniorBondsMember 2023-12-31 0001027552 bsac:SeniorBondsMember 2022-01-01 2022-12-31 0001027552 bsac:SeniorBondsMember 2022-12-31 0001027552 bsac:MortgageBondsMember 2023-01-01 2023-12-31 0001027552 bsac:MortgageBondsMember 2023-12-31 0001027552 bsac:MortgageBondsMember 2022-01-01 2022-12-31 0001027552 bsac:MortgageBondsMember 2022-12-31 0001027552 bsac:MortgageFinanceBondsMember bsac:DueWithin1YearMember 2023-12-31 0001027552 bsac:MortgageFinanceBondsMember bsac:DueWithin1YearMember 2022-12-31 0001027552 bsac:MortgageFinanceBondsMember bsac:DueAfter1YearButWithin2YearsMember 2023-12-31 0001027552 bsac:MortgageFinanceBondsMember bsac:DueAfter1YearButWithin2YearsMember 2022-12-31 0001027552 bsac:MortgageFinanceBondsMember bsac:DueAfter2YearsButWithin3YearsMember 2023-12-31 0001027552 bsac:MortgageFinanceBondsMember bsac:DueAfter2YearsButWithin3YearsMember 2022-12-31 0001027552 bsac:MortgageFinanceBondsMember bsac:DueAfter3YearsButWithin4YearsMember 2023-12-31 0001027552 bsac:MortgageFinanceBondsMember bsac:DueAfter3YearsButWithin4YearsMember 2022-12-31 0001027552 bsac:MortgageFinanceBondsMember bsac:DueAfter4YearsButWithin5YearsMember 2023-12-31 0001027552 bsac:MortgageFinanceBondsMember bsac:DueAfter4YearsButWithin5YearsMember 2022-12-31 0001027552 bsac:MortgageFinanceBondsMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:MortgageFinanceBondsMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:UFMember bsac:SeniorBondsMember 2023-12-31 0001027552 bsac:UFMember bsac:SeniorBondsMember 2022-12-31 0001027552 bsac:USDMember bsac:SeniorBondsMember 2023-12-31 0001027552 bsac:USDMember bsac:SeniorBondsMember 2022-12-31 0001027552 bsac:CHFMember bsac:SeniorBondsMember 2023-12-31 0001027552 bsac:CHFMember bsac:SeniorBondsMember 2022-12-31 0001027552 bsac:CLPMember bsac:SeniorBondsMember 2023-12-31 0001027552 bsac:CLPMember bsac:SeniorBondsMember 2022-12-31 0001027552 bsac:AUDMember bsac:SeniorBondsMember 2023-12-31 0001027552 bsac:AUDMember bsac:SeniorBondsMember 2022-12-31 0001027552 bsac:JPYMember bsac:SeniorBondsMember 2023-12-31 0001027552 bsac:JPYMember bsac:SeniorBondsMember 2022-12-31 0001027552 bsac:EURMember bsac:SeniorBondsMember 2023-12-31 0001027552 bsac:EURMember bsac:SeniorBondsMember 2022-12-31 0001027552 bsac:UFMember bsac:W3Member bsac:SeniorBonds29Member 2023-01-01 2023-12-31 0001027552 bsac:UFMember bsac:W3Member bsac:SeniorBonds29Member 2023-12-31 0001027552 bsac:UFMember bsac:W5Member bsac:SeniorBonds30Member 2023-01-01 2023-12-31 0001027552 bsac:UFMember bsac:W5Member bsac:SeniorBonds30Member 2023-12-31 0001027552 bsac:UFMember bsac:AA13Member bsac:SeniorBonds31Member 2023-01-01 2023-12-31 0001027552 bsac:UFMember bsac:AA13Member bsac:SeniorBonds31Member 2023-12-31 0001027552 bsac:UFMember bsac:SeniorBonds32Member 2023-12-31 0001027552 bsac:CLPMember bsac:U7Member bsac:SeniorBonds33Member 2023-01-01 2023-12-31 0001027552 bsac:CLPMember bsac:U7Member bsac:SeniorBonds33Member 2023-12-31 0001027552 bsac:CLPMember bsac:T18Member bsac:SeniorBonds34Member 2023-01-01 2023-12-31 0001027552 bsac:CLPMember bsac:T18Member bsac:SeniorBonds34Member 2023-12-31 0001027552 bsac:CLPMember bsac:AA7Member bsac:SeniorBonds35Member 2023-01-01 2023-12-31 0001027552 bsac:CLPMember bsac:AA7Member bsac:SeniorBonds35Member 2023-12-31 0001027552 bsac:CLPMember bsac:AA1Member bsac:SeniorBonds36Member 2023-01-01 2023-12-31 0001027552 bsac:CLPMember bsac:AA1Member bsac:SeniorBonds36Member 2023-12-31 0001027552 bsac:CLPMember bsac:AA3Member bsac:SeniorBonds37Member 2023-01-01 2023-12-31 0001027552 bsac:CLPMember bsac:AA3Member bsac:SeniorBonds37Member 2023-12-31 0001027552 bsac:CLPMember bsac:AA10Member bsac:SeniorBonds38Member 2023-01-01 2023-12-31 0001027552 bsac:CLPMember bsac:AA10Member bsac:SeniorBonds38Member 2023-12-31 0001027552 bsac:CLPMember bsac:AA8Member bsac:SeniorBonds39Member 2023-01-01 2023-12-31 0001027552 bsac:CLPMember bsac:AA8Member bsac:SeniorBonds39Member 2023-12-31 0001027552 bsac:CLPMember bsac:AA2Member bsac:SeniorBonds40Member 2023-01-01 2023-12-31 0001027552 bsac:CLPMember bsac:AA2Member bsac:SeniorBonds40Member 2023-12-31 0001027552 bsac:CLPMember bsac:AA9Member bsac:SeniorBonds41Member 2023-01-01 2023-12-31 0001027552 bsac:CLPMember bsac:AA9Member bsac:SeniorBonds41Member 2023-12-31 0001027552 bsac:CLPMember bsac:SeniorBonds42Member 2023-12-31 0001027552 bsac:USDMember bsac:BonoUSDMember bsac:SeniorBonds43Member 2023-01-01 2023-12-31 0001027552 bsac:USDMember bsac:BonoUSDMember bsac:SeniorBonds43Member 2023-12-31 0001027552 bsac:USDMember bsac:SeniorBonds44Member 2023-12-31 0001027552 bsac:JPYMember bsac:BonoJPYMember bsac:SeniorBonds45Member 2023-01-01 2023-12-31 0001027552 bsac:JPYMember bsac:BonoJPYMember bsac:SeniorBonds45Member 2023-12-31 0001027552 bsac:JPYMember bsac:BonoJPYMember bsac:SeniorBonds46Member 2023-01-01 2023-12-31 0001027552 bsac:JPYMember bsac:BonoJPYMember bsac:SeniorBonds46Member 2023-12-31 0001027552 bsac:JPYMember bsac:BonoJPYMember bsac:SeniorBonds47Member 2023-01-01 2023-12-31 0001027552 bsac:JPYMember bsac:BonoJPYMember bsac:SeniorBonds47Member 2023-12-31 0001027552 bsac:JPYMember bsac:SeniorBonds48Member 2023-12-31 0001027552 bsac:UFMember bsac:T3Member bsac:SeniorBonds49Member 2023-01-01 2023-12-31 0001027552 bsac:UFMember bsac:T3Member bsac:SeniorBonds49Member 2023-12-31 0001027552 bsac:UFMember bsac:W3Member bsac:SeniorBonds50Member 2023-01-01 2023-12-31 0001027552 bsac:UFMember bsac:W3Member bsac:SeniorBonds50Member 2023-12-31 0001027552 bsac:UFMember bsac:W5Member bsac:SeniorBonds51Member 2023-01-01 2023-12-31 0001027552 bsac:UFMember bsac:W5Member bsac:SeniorBonds51Member 2023-12-31 0001027552 bsac:UFMember bsac:U2Member bsac:SeniorBonds52Member 2023-01-01 2023-12-31 0001027552 bsac:UFMember bsac:U2Member bsac:SeniorBonds52Member 2023-12-31 0001027552 bsac:UFMember bsac:U1Member bsac:SeniorBonds53Member 2023-01-01 2023-12-31 0001027552 bsac:UFMember bsac:U1Member bsac:SeniorBonds53Member 2023-12-31 0001027552 bsac:UFMember bsac:T20Member bsac:SeniorBonds54Member 2023-01-01 2023-12-31 0001027552 bsac:UFMember bsac:T20Member bsac:SeniorBonds54Member 2023-12-31 0001027552 bsac:UFMember bsac:W4Member bsac:SeniorBonds55Member 2023-01-01 2023-12-31 0001027552 bsac:UFMember bsac:W4Member bsac:SeniorBonds55Member 2023-12-31 0001027552 bsac:UFMember bsac:W9Member bsac:SeniorBonds56Member 2023-01-01 2023-12-31 0001027552 bsac:UFMember bsac:W9Member bsac:SeniorBonds56Member 2023-12-31 0001027552 bsac:UFMember bsac:SeniorBonds57Member 2023-12-31 0001027552 bsac:UFMember bsac:SeniorBonds57Member 2023-01-01 2023-12-31 0001027552 bsac:USDMember bsac:USDBondsMember bsac:SeniorBonds58Member 2023-01-01 2023-12-31 0001027552 bsac:USDMember bsac:USDBondsMember bsac:SeniorBonds58Member 2023-12-31 0001027552 bsac:USDMember bsac:SeniorBonds59Member 2023-12-31 0001027552 bsac:USDMember bsac:SeniorBonds59Member 2023-01-01 2023-12-31 0001027552 bsac:CLPMember bsac:U6Member bsac:SeniorBonds60Member 2023-01-01 2023-12-31 0001027552 bsac:CLPMember bsac:U6Member bsac:SeniorBonds60Member 2023-12-31 0001027552 bsac:CLPMember bsac:U5Member bsac:SeniorBonds61Member 2023-01-01 2023-12-31 0001027552 bsac:CLPMember bsac:U5Member bsac:SeniorBonds61Member 2023-12-31 0001027552 bsac:CLPMember bsac:U6Member bsac:SeniorBonds62Member 2023-01-01 2023-12-31 0001027552 bsac:CLPMember bsac:U6Member bsac:SeniorBonds62Member 2023-12-31 0001027552 bsac:CLPMember bsac:U7Member bsac:SeniorBonds63Member 2023-01-01 2023-12-31 0001027552 bsac:CLPMember bsac:U7Member bsac:SeniorBonds63Member 2023-12-31 0001027552 bsac:CLPMember bsac:T17Member bsac:SeniorBonds64Member 2023-01-01 2023-12-31 0001027552 bsac:CLPMember bsac:T17Member bsac:SeniorBonds64Member 2023-12-31 0001027552 bsac:CLPMember bsac:SeniorBonds65Member 2023-12-31 0001027552 bsac:CLPMember bsac:SeniorBonds65Member 2023-01-01 2023-12-31 0001027552 bsac:JPYMember bsac:BonoJPYMember bsac:SeniorBonds66Member 2023-01-01 2023-12-31 0001027552 bsac:JPYMember bsac:BonoJPYMember bsac:SeniorBonds66Member 2023-12-31 0001027552 bsac:JPYMember bsac:SeniorBonds67Member 2023-12-31 0001027552 bsac:JPYMember bsac:SeniorBonds67Member 2023-01-01 2023-12-31 0001027552 bsac:SeniorBondMember 2023-01-01 2023-12-31 0001027552 bsac:SeniorBond1Member 2023-01-01 2023-12-31 0001027552 bsac:SeniorBond2Member 2023-01-01 2023-12-31 0001027552 bsac:SeniorBond3Member 2023-01-01 2023-12-31 0001027552 bsac:SeniorBond4Member 2023-01-01 2023-12-31 0001027552 bsac:SeniorBond5Member 2023-01-01 2023-12-31 0001027552 bsac:SeniorBond6Member 2023-01-01 2023-12-31 0001027552 bsac:SeniorBond7Member 2023-01-01 2023-12-31 0001027552 bsac:SeniorBond8Member 2023-01-01 2023-12-31 0001027552 bsac:SeniorBonds1Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBond2Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBond3Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBond4Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBond5Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBond6Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBond7Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBond8Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBond9Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds10Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds11Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds12Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds13Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds14Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds15Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds16Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds17Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds18Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds19Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds20Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds21Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds22Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds23Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds24Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds25Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds26Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds27Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds28Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds29Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds30Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds31Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds32Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds33Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds34Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds35Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds36Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds37Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds38Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds39Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds40Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBonds41Member 2022-01-01 2022-12-31 0001027552 bsac:SeniorBondsMember bsac:DueWithin1YearMember 2023-12-31 0001027552 bsac:SeniorBondsMember bsac:DueWithin1YearMember 2022-12-31 0001027552 bsac:SeniorBondsMember bsac:DueAfter1YearButWithin2YearsMember 2023-12-31 0001027552 bsac:SeniorBondsMember bsac:DueAfter1YearButWithin2YearsMember 2022-12-31 0001027552 bsac:SeniorBondsMember bsac:DueAfter2YearsButWithin3YearsMember 2023-12-31 0001027552 bsac:SeniorBondsMember bsac:DueAfter2YearsButWithin3YearsMember 2022-12-31 0001027552 bsac:SeniorBondsMember bsac:DueAfter3YearsButWithin4YearsMember 2023-12-31 0001027552 bsac:SeniorBondsMember bsac:DueAfter3YearsButWithin4YearsMember 2022-12-31 0001027552 bsac:SeniorBondsMember bsac:DueAfter4YearsButWithin5YearsMember 2023-12-31 0001027552 bsac:SeniorBondsMember bsac:DueAfter4YearsButWithin5YearsMember 2022-12-31 0001027552 bsac:SeniorBondsMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:SeniorBondsMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:MortgageBondsMember bsac:DueWithin1YearMember 2023-12-31 0001027552 bsac:MortgageBondsMember bsac:DueWithin1YearMember 2022-12-31 0001027552 bsac:MortgageBondsMember bsac:DueAfter1YearButWithin2YearsMember 2023-12-31 0001027552 bsac:MortgageBondsMember bsac:DueAfter1YearButWithin2YearsMember 2022-12-31 0001027552 bsac:MortgageBondsMember bsac:DueAfter2YearsButWithin3YearsMember 2023-12-31 0001027552 bsac:MortgageBondsMember bsac:DueAfter2YearsButWithin3YearsMember 2022-12-31 0001027552 bsac:MortgageBondsMember bsac:DueAfter3YearsButWithin4YearsMember 2023-12-31 0001027552 bsac:MortgageBondsMember bsac:DueAfter3YearsButWithin4YearsMember 2022-12-31 0001027552 bsac:MortgageBondsMember bsac:DueAfter4YearsButWithin5YearsMember 2023-12-31 0001027552 bsac:MortgageBondsMember bsac:DueAfter4YearsButWithin5YearsMember 2022-12-31 0001027552 bsac:MortgageBondsMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:MortgageBondsMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:DueAfterOneYearButWithinTwoYearsMember 2023-12-31 0001027552 bsac:DueAfterOneYearButWithinTwoYearsMember 2022-12-31 0001027552 bsac:DueAfterThreeYearButWithinFourYearsMember 2023-12-31 0001027552 bsac:DueAfterThreeYearButWithinFourYearsMember 2022-12-31 0001027552 bsac:DueAfterFourYearButWithinFiveYearsMember 2023-12-31 0001027552 bsac:DueAfterFourYearButWithinFiveYearsMember 2022-12-31 0001027552 bsac:DueAfterFiveYearsMember 2023-12-31 0001027552 bsac:DueAfterFiveYearsMember 2022-12-31 0001027552 bsac:NoncurrentPortionMember 2023-12-31 0001027552 bsac:NoncurrentPortionMember 2022-12-31 0001027552 bsac:DueWithinOneYearMember 2023-12-31 0001027552 bsac:DueWithinOneYearMember 2022-12-31 0001027552 bsac:DueAfterTwoYearButWithinThreeYearsMember 2023-12-31 0001027552 bsac:DueAfterTwoYearButWithinThreeYearsMember 2022-12-31 0001027552 bsac:SubordinatedBondsMember 2023-12-31 0001027552 bsac:SubordinatedBondsMember 2022-12-31 0001027552 bsac:PersonnelSalariesAndExpensesMember 2022-12-31 0001027552 bsac:LawsuitAndLitigationsMember 2022-12-31 0001027552 bsac:LoyaltyProgrammMember 2022-12-31 0001027552 bsac:OperationalRisksMember 2022-12-31 0001027552 bsac:ContingenciesMember 2022-12-31 0001027552 bsac:MandatoryDividendMember 2022-12-31 0001027552 bsac:InterestOfPerpetualBondsMember 2022-12-31 0001027552 bsac:ContingentLoanMember 2022-12-31 0001027552 bsac:PersonnelSalariesAndExpensesMember 2023-01-01 2023-12-31 0001027552 bsac:LawsuitAndLitigationsMember 2023-01-01 2023-12-31 0001027552 bsac:LoyaltyProgrammMember 2023-01-01 2023-12-31 0001027552 bsac:OperationalRisksMember 2023-01-01 2023-12-31 0001027552 bsac:ContingenciesMember 2023-01-01 2023-12-31 0001027552 bsac:MandatoryDividendMember 2023-01-01 2023-12-31 0001027552 bsac:InterestOfPerpetualBondsMember 2023-01-01 2023-12-31 0001027552 bsac:ContingentLoanMember 2023-01-01 2023-12-31 0001027552 bsac:PersonnelSalariesAndExpensesMember 2023-12-31 0001027552 bsac:LawsuitAndLitigationsMember 2023-12-31 0001027552 bsac:LoyaltyProgrammMember 2023-12-31 0001027552 bsac:OperationalRisksMember 2023-12-31 0001027552 bsac:ContingenciesMember 2023-12-31 0001027552 bsac:MandatoryDividendMember 2023-12-31 0001027552 bsac:InterestOfPerpetualBondsMember 2023-12-31 0001027552 bsac:ContingentLoanMember 2023-12-31 0001027552 bsac:PersonnelSalariesAndExpensesMember 2021-12-31 0001027552 bsac:LawsuitAndLitigationsMember 2021-12-31 0001027552 bsac:LoyaltyProgrammMember 2021-12-31 0001027552 bsac:OperationalRisksMember 2021-12-31 0001027552 bsac:ContingenciesMember 2021-12-31 0001027552 bsac:MandatoryDividendMember 2021-12-31 0001027552 bsac:InterestOfPerpetualBondsMember 2021-12-31 0001027552 bsac:ContingentLoanMember 2021-12-31 0001027552 bsac:PersonnelSalariesAndExpensesMember 2022-01-01 2022-12-31 0001027552 bsac:LawsuitAndLitigationsMember 2022-01-01 2022-12-31 0001027552 bsac:LoyaltyProgrammMember 2022-01-01 2022-12-31 0001027552 bsac:OperationalRisksMember 2022-01-01 2022-12-31 0001027552 bsac:ContingenciesMember 2022-01-01 2022-12-31 0001027552 bsac:MandatoryDividendMember 2022-01-01 2022-12-31 0001027552 bsac:InterestOfPerpetualBondsMember 2022-01-01 2022-12-31 0001027552 bsac:ContingentLoanMember 2022-01-01 2022-12-31 0001027552 bsac:PersonnelSalariesAndExpensesMember 2020-12-31 0001027552 bsac:LawsuitAndLitigationsMember 2020-12-31 0001027552 bsac:LoyaltyProgrammMember 2020-12-31 0001027552 bsac:OperationalRisksMember 2020-12-31 0001027552 bsac:ContingenciesMember 2020-12-31 0001027552 bsac:MandatoryDividendMember 2020-12-31 0001027552 bsac:InterestOfPerpetualBondsMember 2020-12-31 0001027552 bsac:ContingentLoanMember 2020-12-31 0001027552 bsac:PersonnelSalariesAndExpensesMember 2021-01-01 2021-12-31 0001027552 bsac:LawsuitAndLitigationsMember 2021-01-01 2021-12-31 0001027552 bsac:OperationalRisksMember 2021-01-01 2021-12-31 0001027552 bsac:ContingenciesMember 2021-01-01 2021-12-31 0001027552 bsac:MandatoryDividendMember 2021-01-01 2021-12-31 0001027552 bsac:InterestOfPerpetualBondsMember 2021-01-01 2021-12-31 0001027552 bsac:ContingentLoanMember 2021-01-01 2021-12-31 0001027552 bsac:LoyaltyProgrammMember 2021-01-01 2021-12-31 0001027552 bsac:Stage3Member 2022-12-31 0001027552 bsac:Stage3Member 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member 2023-12-31 0001027552 bsac:Stage3Member 2021-12-31 0001027552 bsac:Stage3Member 2022-01-01 2022-12-31 0001027552 bsac:SantanderChileHoldingSAMember 2023-12-31 0001027552 bsac:TeatinosSigloXXIInversionesLimitadaMember 2023-12-31 0001027552 bsac:TheBankNewYorkMellonMember 2023-12-31 0001027552 bsac:BancosPorCuentaDeTercerosMember 2023-12-31 0001027552 bsac:AFPPorCuentasDeTercerosMember 2023-12-31 0001027552 bsac:CorredorasDeBolsaPorCuentaDeTercerosMember 2023-12-31 0001027552 bsac:OtherMinorityHoldersMember 2023-12-31 0001027552 bsac:SantanderChileHoldingSAMember 2022-12-31 0001027552 bsac:TeatinosSigloXxiInversionesLimitadaMember 2022-12-31 0001027552 bsac:TheBankNewYorkMellonMember 2022-12-31 0001027552 bsac:BanksOnBehalfOfThirdPartiesMember 2022-12-31 0001027552 bsac:PensionFundsAFPOnBehalfOfThirdPartiesMember 2022-12-31 0001027552 bsac:StockBrokersOnBehalfOfThirdPartiesMember 2022-12-31 0001027552 bsac:OtherMinorityHoldersMember 2022-12-31 0001027552 bsac:SantanderChileHoldingSAMember 2021-12-31 0001027552 bsac:TeatinosSigloXxiInversionesLimitadaMember 2021-12-31 0001027552 bsac:TheBankNewYorkMellonMember 2021-12-31 0001027552 bsac:BanksOnBehalfOfThirdPartiesMember 2021-12-31 0001027552 bsac:PensionFundsAFPOnBehalfOfThirdPartiesMember 2021-12-31 0001027552 bsac:StockBrokersOnBehalfOfThirdPartiesMember 2021-12-31 0001027552 bsac:OtherMinorityHoldersMember 2021-12-31 0001027552 bsac:PerpetualBondMember 2023-01-01 2023-12-31 0001027552 bsac:PerpetualBondMember 2022-01-01 2022-12-31 0001027552 bsac:USDBondsMember 2023-01-01 2023-12-31 0001027552 bsac:USDBondsMember 2022-01-01 2022-12-31 0001027552 bsac:PerpetualBondMember 2023-12-31 0001027552 bsac:PerpetualBondMember 2022-12-31 0001027552 bsac:AT1BondMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderCorredoraDeSegurosLimitadaMember 2023-12-31 0001027552 bsac:SantanderCorredoresdeBolsaLimitadaMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderCorredoresdeBolsaLimitadaMember 2023-12-31 0001027552 bsac:SantanderAsesorasFinancierasLimitadaMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderAsesorasFinancierasLimitadaMember 2023-12-31 0001027552 bsac:SantanderSASociedadSecuritizadoraMember 2023-12-31 0001027552 bsac:KlareCorredoraDeSegurosSAMember 2023-12-31 0001027552 bsac:SantanderConsumerChileMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderConsumerChileMember 2023-12-31 0001027552 bsac:SubtotalOneMember 2023-12-31 0001027552 bsac:SubtotalOneMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderGestinDeRecaudacinYCobranzasLimitadaMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderGestinDeRecaudacinYCobranzasLimitadaMember 2023-12-31 0001027552 bsac:BansaSantanderSAMember 2023-01-01 2023-12-31 0001027552 bsac:BansaSantanderSAMember 2023-12-31 0001027552 bsac:MultiplicaSpaMember 2023-01-01 2023-12-31 0001027552 bsac:MultiplicaSpaMember 2023-12-31 0001027552 bsac:PagoNXTTradeChileSpAMember 2023-01-01 2023-12-31 0001027552 bsac:PagoNXTTradeChileSpAMember 2023-12-31 0001027552 bsac:SubtotalTwoMember 2023-12-31 0001027552 bsac:SubtotalTwoMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderCorredoraDeSegurosLimitadaMember 2022-12-31 0001027552 bsac:SantanderCorredoresdeBolsaLimitadaMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderCorredoresdeBolsaLimitadaMember 2022-12-31 0001027552 bsac:SantanderAsesorasFinancierasLimitadaMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderAsesorasFinancierasLimitadaMember 2022-12-31 0001027552 bsac:SantanderSASociedadSecuritizadoraMember 2022-12-31 0001027552 bsac:KlareCorredoraDeSegurosMember 2022-01-01 2022-12-31 0001027552 bsac:KlareCorredoraDeSegurosMember 2022-12-31 0001027552 bsac:SantanderConsumerChileMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderConsumerChileMember 2022-12-31 0001027552 bsac:SubtotalOneMember 2022-12-31 0001027552 bsac:SubtotalOneMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderGestinDeRecaudacinYCobranzasLimitadaMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderGestinDeRecaudacinYCobranzasLimitadaMember 2022-12-31 0001027552 bsac:BansaSantanderSAMember 2022-01-01 2022-12-31 0001027552 bsac:BansaSantanderSAMember 2022-12-31 0001027552 bsac:MultiplicaSpaOneMember 2022-01-01 2022-12-31 0001027552 bsac:MultiplicaSpaOneMember 2022-12-31 0001027552 bsac:SubtotalTwoMember 2022-12-31 0001027552 bsac:SubtotalTwoMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderCorredoraDeSegurosLimitadaMember 2021-12-31 0001027552 bsac:SantanderCorredoresdeBolsaLimitadaMember 2021-01-01 2021-12-31 0001027552 bsac:SantanderCorredoresdeBolsaLimitadaMember 2021-12-31 0001027552 bsac:SantanderAsesorasFinancierasLimitadaMember 2021-01-01 2021-12-31 0001027552 bsac:SantanderAsesorasFinancierasLimitadaMember 2021-12-31 0001027552 bsac:SantanderSASociedadSecuritizadoraMember 2021-12-31 0001027552 bsac:KlareCorredoraDeSegurosMember 2021-01-01 2021-12-31 0001027552 bsac:KlareCorredoraDeSegurosMember 2021-12-31 0001027552 bsac:SantanderConsumerChileMember 2021-01-01 2021-12-31 0001027552 bsac:SantanderConsumerChileMember 2021-12-31 0001027552 bsac:SubtotalOneMember 2021-12-31 0001027552 bsac:SubtotalOneMember 2021-01-01 2021-12-31 0001027552 bsac:SantanderGestinDeRecaudacinYCobranzasLimitadaMember 2021-01-01 2021-12-31 0001027552 bsac:SantanderGestinDeRecaudacinYCobranzasLimitadaMember 2021-12-31 0001027552 bsac:BansaSantanderSAMember 2021-01-01 2021-12-31 0001027552 bsac:BansaSantanderSAMember 2021-12-31 0001027552 bsac:MultiplicaSpaTwoMember 2021-01-01 2021-12-31 0001027552 bsac:MultiplicaSpaTwoMember 2021-12-31 0001027552 bsac:SubtotalTwoMember 2021-12-31 0001027552 bsac:SubtotalTwoMember 2021-01-01 2021-12-31 0001027552 bsac:SantanderAsesoriasFinancierasLimitadaMember 2023-12-31 0001027552 bsac:SantanderAsesoriasFinancierasLimitadaMember 2022-12-31 0001027552 bsac:SantanderAsesoriasFinancierasLimitadaMember 2021-12-31 0001027552 bsac:KlareCorredoraDeSegurosMember 2023-12-31 0001027552 bsac:KlareCorredoraDeSegurosMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderConsumerChileSAMember 2023-12-31 0001027552 bsac:SantanderConsumerChileSAMember 2022-12-31 0001027552 bsac:SantanderConsumerChileSAMember 2021-12-31 0001027552 bsac:SantanderGestinDeRecaudacinYCobranzasLtdaMember 2023-12-31 0001027552 bsac:SantanderGestinDeRecaudacinYCobranzasLtdaMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderGestinDeRecaudacinYCobranzasLtdaMember 2022-12-31 0001027552 bsac:SantanderGestinDeRecaudacinYCobranzasLtdaMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderGestinDeRecaudacinYCobranzasLtdaMember 2021-12-31 0001027552 bsac:SantanderGestinDeRecaudacinYCobranzasLtdaMember 2021-01-01 2021-12-31 0001027552 bsac:MultiplicaSpaMember 2022-12-31 0001027552 bsac:MultiplicaSpaMember 2022-01-01 2022-12-31 0001027552 bsac:MultiplicaSpaMember 2021-12-31 0001027552 bsac:MultiplicaSpaMember 2021-01-01 2021-12-31 0001027552 bsac:PagoNXTTradeChileSpAMember 2022-12-31 0001027552 bsac:PagoNXTTradeChileSpAMember 2022-01-01 2022-12-31 0001027552 bsac:PagoNXTTradeChileSpAMember 2021-12-31 0001027552 bsac:PagoNXTTradeChileSpAMember 2021-01-01 2021-12-31 0001027552 bsac:CashAndDepositsInBanksMember bsac:DemandMember 2023-12-31 0001027552 bsac:CashAndDepositsInBanksMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:CashAndDepositsInBanksMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:CashAndDepositsInBanksMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:CashAndDepositsInBanksMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:CashAndDepositsInBanksMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:CashAndDepositsInBanksMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:CashAndDepositsInBanksMember 2023-12-31 0001027552 bsac:CashItemsInProcessOfCollectionMember bsac:DemandMember 2023-12-31 0001027552 bsac:CashItemsInProcessOfCollectionMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:CashItemsInProcessOfCollectionMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:CashItemsInProcessOfCollectionMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:CashItemsInProcessOfCollectionMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:CashItemsInProcessOfCollectionMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:CashItemsInProcessOfCollectionMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:CashItemsInProcessOfCollectionMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialAssetsForTradingAtFVTPLMember bsac:DemandMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialAssetsForTradingAtFVTPLMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialAssetsForTradingAtFVTPLMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialAssetsForTradingAtFVTPLMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialAssetsForTradingAtFVTPLMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialAssetsForTradingAtFVTPLMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialAssetsForTradingAtFVTPLMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialAssetsForTradingAtFVTPLMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsForTradingAtFVTPLMember bsac:DemandMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsForTradingAtFVTPLMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsForTradingAtFVTPLMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsForTradingAtFVTPLMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsForTradingAtFVTPLMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsForTradingAtFVTPLMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsForTradingAtFVTPLMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsForTradingAtFVTPLMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember bsac:DemandMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember bsac:DemandMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:DemandMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember ifrs-full:FinancialAssetsAtAmortisedCostMember 2023-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:DemandMember 2023-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:FinancialAssetsAtAmortisedCostMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:DemandMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:FinancialAssetsAtAmortisedCostMember 2023-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:DemandMember 2023-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:FinancialAssetsAtAmortisedCostMember 2023-12-31 0001027552 ifrs-full:FinancialAssetsTypeMember bsac:DemandMember 2023-12-31 0001027552 ifrs-full:FinancialAssetsTypeMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 ifrs-full:FinancialAssetsTypeMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 ifrs-full:FinancialAssetsTypeMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 ifrs-full:FinancialAssetsTypeMember bsac:Between1And3YearsMember 2023-12-31 0001027552 ifrs-full:FinancialAssetsTypeMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 ifrs-full:FinancialAssetsTypeMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 ifrs-full:FinancialAssetsTypeMember 2023-12-31 0001027552 bsac:CashItemsInProcessOfBeingClearedMember bsac:DemandMember 2023-12-31 0001027552 bsac:CashItemsInProcessOfBeingClearedMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:CashItemsInProcessOfBeingClearedMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:CashItemsInProcessOfBeingClearedMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:CashItemsInProcessOfBeingClearedMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:CashItemsInProcessOfBeingClearedMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:CashItemsInProcessOfBeingClearedMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:CashItemsInProcessOfBeingClearedMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialLiabilitiesForTradingAtFVTPLMember bsac:DemandMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialLiabilitiesForTradingAtFVTPLMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialLiabilitiesForTradingAtFVTPLMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialLiabilitiesForTradingAtFVTPLMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialLiabilitiesForTradingAtFVTPLMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialLiabilitiesForTradingAtFVTPLMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialLiabilitiesForTradingAtFVTPLMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialLiabilitiesForTradingAtFVTPLMember 2023-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DemandMember 2023-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DemandMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember 2023-12-31 0001027552 bsac:ObligationsUnderRepurchaseAgreementsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DemandMember 2023-12-31 0001027552 bsac:ObligationsUnderRepurchaseAgreementsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:ObligationsUnderRepurchaseAgreementsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:ObligationsUnderRepurchaseAgreementsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:ObligationsUnderRepurchaseAgreementsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:ObligationsUnderRepurchaseAgreementsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:ObligationsUnderRepurchaseAgreementsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:ObligationsUnderRepurchaseAgreementsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember 2023-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DemandMember 2023-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember 2023-12-31 0001027552 bsac:IssueDebtInstrumentsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DemandMember 2023-12-31 0001027552 bsac:IssueDebtInstrumentsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:IssueDebtInstrumentsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:IssueDebtInstrumentsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:IssueDebtInstrumentsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:IssueDebtInstrumentsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:IssueDebtInstrumentsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:IssueDebtInstrumentsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember 2023-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DemandMember 2023-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember 2023-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DemandMember 2023-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:Between1And3YearsMember 2023-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DemandMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:Between1And3YearsMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember 2023-12-31 0001027552 ifrs-full:FinancialLiabilitiesTypeMember bsac:DemandMember 2023-12-31 0001027552 ifrs-full:FinancialLiabilitiesTypeMember ifrs-full:NotLaterThanOneMonthMember 2023-12-31 0001027552 ifrs-full:FinancialLiabilitiesTypeMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2023-12-31 0001027552 ifrs-full:FinancialLiabilitiesTypeMember bsac:MoreThan3MonthsTo1YearMember 2023-12-31 0001027552 ifrs-full:FinancialLiabilitiesTypeMember bsac:Between1And3YearsMember 2023-12-31 0001027552 ifrs-full:FinancialLiabilitiesTypeMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2023-12-31 0001027552 ifrs-full:FinancialLiabilitiesTypeMember bsac:DueAfter5YearsMember 2023-12-31 0001027552 ifrs-full:FinancialLiabilitiesTypeMember 2023-12-31 0001027552 bsac:CashAndDepositsInBanksMember bsac:DemandMember 2022-12-31 0001027552 bsac:CashAndDepositsInBanksMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:CashAndDepositsInBanksMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:CashAndDepositsInBanksMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:CashAndDepositsInBanksMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:CashAndDepositsInBanksMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:CashAndDepositsInBanksMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:CashAndDepositsInBanksMember 2022-12-31 0001027552 bsac:CashItemsInProcessOfCollectionMember bsac:DemandMember 2022-12-31 0001027552 bsac:CashItemsInProcessOfCollectionMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:CashItemsInProcessOfCollectionMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:CashItemsInProcessOfCollectionMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:CashItemsInProcessOfCollectionMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:CashItemsInProcessOfCollectionMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:CashItemsInProcessOfCollectionMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:CashItemsInProcessOfCollectionMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialAssetsForTradingAtFVTPLMember bsac:DemandMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialAssetsForTradingAtFVTPLMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialAssetsForTradingAtFVTPLMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialAssetsForTradingAtFVTPLMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialAssetsForTradingAtFVTPLMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialAssetsForTradingAtFVTPLMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialAssetsForTradingAtFVTPLMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialAssetsForTradingAtFVTPLMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsForTradingAtFVTPLMember bsac:DemandMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsForTradingAtFVTPLMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsForTradingAtFVTPLMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsForTradingAtFVTPLMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsForTradingAtFVTPLMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsForTradingAtFVTPLMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsForTradingAtFVTPLMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsForTradingAtFVTPLMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember bsac:DemandMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember bsac:DemandMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:FinancialAssetsAtFVOCIMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtAmortizedCostMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:DemandMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtAmortizedCostMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtAmortizedCostMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtAmortizedCostMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtAmortizedCostMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtAmortizedCostMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtAmortizedCostMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtAmortizedCostMember ifrs-full:FinancialAssetsAtAmortisedCostMember 2022-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:DemandMember 2022-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:FinancialAssetsAtAmortisedCostMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivablesAtAmortizedCostMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:DemandMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivablesAtAmortizedCostMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivablesAtAmortizedCostMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivablesAtAmortizedCostMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivablesAtAmortizedCostMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivablesAtAmortizedCostMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivablesAtAmortizedCostMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivablesAtAmortizedCostMember ifrs-full:FinancialAssetsAtAmortisedCostMember 2022-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:DemandMember 2022-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:FinancialAssetsAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:FinancialAssetsAtAmortisedCostMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:FinancialAssetsAtAmortisedCostMember 2022-12-31 0001027552 ifrs-full:FinancialAssetsTypeMember bsac:DemandMember 2022-12-31 0001027552 ifrs-full:FinancialAssetsTypeMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 ifrs-full:FinancialAssetsTypeMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 ifrs-full:FinancialAssetsTypeMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 ifrs-full:FinancialAssetsTypeMember bsac:Between1And3YearsMember 2022-12-31 0001027552 ifrs-full:FinancialAssetsTypeMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 ifrs-full:FinancialAssetsTypeMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 ifrs-full:FinancialAssetsTypeMember 2022-12-31 0001027552 bsac:CashItemsInProcessOfBeingClearedMember bsac:DemandMember 2022-12-31 0001027552 bsac:CashItemsInProcessOfBeingClearedMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:CashItemsInProcessOfBeingClearedMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:CashItemsInProcessOfBeingClearedMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:CashItemsInProcessOfBeingClearedMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:CashItemsInProcessOfBeingClearedMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:CashItemsInProcessOfBeingClearedMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:CashItemsInProcessOfBeingClearedMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialLiabilitiesForTradingAtFVTPLMember bsac:DemandMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialLiabilitiesForTradingAtFVTPLMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialLiabilitiesForTradingAtFVTPLMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialLiabilitiesForTradingAtFVTPLMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialLiabilitiesForTradingAtFVTPLMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialLiabilitiesForTradingAtFVTPLMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialLiabilitiesForTradingAtFVTPLMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeContractsMember bsac:FinancialLiabilitiesForTradingAtFVTPLMember 2022-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DemandMember 2022-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DemandMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember 2022-12-31 0001027552 bsac:ObligationsUnderRepurchaseAgreementsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DemandMember 2022-12-31 0001027552 bsac:ObligationsUnderRepurchaseAgreementsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:ObligationsUnderRepurchaseAgreementsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:ObligationsUnderRepurchaseAgreementsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:ObligationsUnderRepurchaseAgreementsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:ObligationsUnderRepurchaseAgreementsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:ObligationsUnderRepurchaseAgreementsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:ObligationsUnderRepurchaseAgreementsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember 2022-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DemandMember 2022-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DemandMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember 2022-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DemandMember 2022-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember 2022-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DemandMember 2022-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:Between1And3YearsMember 2022-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 ifrs-full:LeaseLiabilitiesMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember 2022-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DemandMember 2022-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:FinancialLiabilitiesAtAmortisedCostMember 2022-12-31 0001027552 bsac:FinancialLiablitiesMember bsac:DemandMember 2022-12-31 0001027552 bsac:FinancialLiablitiesMember ifrs-full:NotLaterThanOneMonthMember 2022-12-31 0001027552 bsac:FinancialLiablitiesMember ifrs-full:LaterThanOneMonthAndNotLaterThanThreeMonthsMember 2022-12-31 0001027552 bsac:FinancialLiablitiesMember bsac:MoreThan3MonthsTo1YearMember 2022-12-31 0001027552 bsac:FinancialLiablitiesMember bsac:Between1And3YearsMember 2022-12-31 0001027552 bsac:FinancialLiablitiesMember ifrs-full:LaterThanThreeYearsAndNotLaterThanFiveYearsMember 2022-12-31 0001027552 bsac:FinancialLiablitiesMember bsac:DueAfter5YearsMember 2022-12-31 0001027552 bsac:FinancialLiablitiesMember 2022-12-31 0001027552 ifrs-full:GuaranteesMember 2023-01-01 2023-12-31 0001027552 bsac:ResaleAgreementsMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:ResaleAgreementsMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:ResaleAgreementsMember bsac:TotalMember 2023-12-31 0001027552 bsac:ResaleAgreementsMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:ResaleAgreementsMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:ResaleAgreementsMember bsac:TotalMember 2022-12-31 0001027552 bsac:ResaleAgreementsMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:ResaleAgreementsMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:ResaleAgreementsMember bsac:TotalMember 2021-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:TotalMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:TotalMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:DebtFinancialInstrumentsMember bsac:TotalMember 2021-12-31 0001027552 bsac:InterbankLoansMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:InterbankLoansMember bsac:TotalMember 2023-12-31 0001027552 bsac:InterbankLoansMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:InterbankLoansMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:InterbankLoansMember bsac:TotalMember 2022-12-31 0001027552 bsac:InterbankLoansMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:InterbankLoansMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:InterbankLoansMember bsac:TotalMember 2021-12-31 0001027552 bsac:CommercialLoansOneMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:CommercialLoansOneMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:CommercialLoansOneMember bsac:TotalMember 2023-12-31 0001027552 bsac:CommercialLoansOneMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:CommercialLoansOneMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:CommercialLoansOneMember bsac:TotalMember 2022-12-31 0001027552 bsac:CommercialLoansOneMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:CommercialLoansOneMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:CommercialLoansOneMember bsac:TotalMember 2021-12-31 0001027552 bsac:MortgageLoansMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:MortgageLoansMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:MortgageLoansMember bsac:TotalMember 2023-12-31 0001027552 bsac:MortgageLoansMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:MortgageLoansMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:MortgageLoansMember bsac:TotalMember 2022-12-31 0001027552 bsac:MortgageLoansMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:MortgageLoansMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:MortgageLoansMember bsac:TotalMember 2021-12-31 0001027552 bsac:LoansToCustomersMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:LoansToCustomersMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:LoansToCustomersMember bsac:TotalMember 2023-12-31 0001027552 bsac:LoansToCustomersMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:LoansToCustomersMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:LoansToCustomersMember bsac:TotalMember 2022-12-31 0001027552 bsac:LoansToCustomersMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:LoansToCustomersMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:LoansToCustomersMember bsac:TotalMember 2021-12-31 0001027552 bsac:OtherInterestIncomeMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:OtherInterestIncomeMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:OtherInterestIncomeMember bsac:TotalMember 2023-12-31 0001027552 bsac:OtherInterestIncomeMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:OtherInterestIncomeMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:OtherInterestIncomeMember bsac:TotalMember 2022-12-31 0001027552 bsac:OtherInterestIncomeMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:OtherInterestIncomeMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:OtherInterestIncomeMember bsac:TotalMember 2021-12-31 0001027552 bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:TotalMember 2023-12-31 0001027552 bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:TotalMember 2022-12-31 0001027552 bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:TotalMember 2021-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:TotalMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:TotalMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:OtherFinancialInstrumentsMember bsac:TotalMember 2021-12-31 0001027552 bsac:HedgingAccountingMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:HedgingAccountingMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:HedgingAccountingMember bsac:TotalMember 2023-12-31 0001027552 bsac:HedgingAccountingMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:HedgingAccountingMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:HedgingAccountingMember bsac:TotalMember 2022-12-31 0001027552 bsac:HedgingAccountingMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:HedgingAccountingMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:HedgingAccountingMember bsac:TotalMember 2021-12-31 0001027552 bsac:DemandDepositsOneMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:DemandDepositsOneMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:DemandDepositsOneMember 2023-12-31 0001027552 bsac:DemandDepositsOneMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:DemandDepositsOneMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:DemandDepositsOneMember 2022-12-31 0001027552 bsac:DemandDepositsOneMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:DemandDepositsOneMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:DemandDepositsOneMember 2021-12-31 0001027552 bsac:TimeDepositsAndLiabilitiesMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:TimeDepositsAndLiabilitiesMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:TimeDepositsAndLiabilitiesMember 2023-12-31 0001027552 bsac:TimeDepositsAndLiabilitiesMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:TimeDepositsAndLiabilitiesMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:TimeDepositsAndLiabilitiesMember 2022-12-31 0001027552 bsac:TimeDepositsAndLiabilitiesMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:TimeDepositsAndLiabilitiesMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:TimeDepositsAndLiabilitiesMember 2021-12-31 0001027552 bsac:RepurchaseAgreementMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:RepurchaseAgreementMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:RepurchaseAgreementMember 2023-12-31 0001027552 bsac:RepurchaseAgreementMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:RepurchaseAgreementMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:RepurchaseAgreementMember 2022-12-31 0001027552 bsac:RepurchaseAgreementMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:RepurchaseAgreementMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:RepurchaseAgreementMember 2021-12-31 0001027552 bsac:InterbankLoansMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:InterbankLoansMember 2021-12-31 0001027552 bsac:IssuedDebtInstrumentsCategoryMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsCategoryMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsCategoryMember 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsCategoryMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsCategoryMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsCategoryMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsCategoryMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:IssuedDebtInstrumentsCategoryMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:IssuedDebtInstrumentsCategoryMember 2021-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember 2023-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember 2022-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember 2021-12-31 0001027552 bsac:LeaseContractsMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:LeaseContractsMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:LeaseContractsMember 2023-12-31 0001027552 bsac:LeaseContractsMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:LeaseContractsMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:LeaseContractsMember 2022-12-31 0001027552 bsac:LeaseContractsMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:LeaseContractsMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:LeaseContractsMember 2021-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember 2023-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember 2022-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember 2021-12-31 0001027552 bsac:OthersEquityInstrumentsMember bsac:HedgedOfInterestMember 2023-12-31 0001027552 bsac:OthersEquityInstrumentsMember bsac:HedgedOfInflationAdjustmentsMember 2023-12-31 0001027552 bsac:OthersEquityInstrumentsMember 2023-12-31 0001027552 bsac:OthersEquityInstrumentsMember bsac:HedgedOfInterestMember 2022-12-31 0001027552 bsac:OthersEquityInstrumentsMember bsac:HedgedOfInflationAdjustmentsMember 2022-12-31 0001027552 bsac:OthersEquityInstrumentsMember 2022-12-31 0001027552 bsac:OthersEquityInstrumentsMember bsac:HedgedOfInterestMember 2021-12-31 0001027552 bsac:OthersEquityInstrumentsMember bsac:HedgedOfInflationAdjustmentsMember 2021-12-31 0001027552 bsac:OthersEquityInstrumentsMember 2021-12-31 0001027552 bsac:HedgingAccountingMember 2023-12-31 0001027552 bsac:HedgingAccountingMember 2022-12-31 0001027552 bsac:HedgingAccountingMember 2021-12-31 0001027552 bsac:IndividualsAndPYMEsMember 2023-01-01 2023-12-31 0001027552 bsac:CompaniesAndInstitutionsMember 2023-01-01 2023-12-31 0001027552 bsac:GlobalInvestmentBankingMember 2023-01-01 2023-12-31 0001027552 bsac:OthersMember 2023-01-01 2023-12-31 0001027552 ifrs-full:ReportableSegmentsMember 2023-01-01 2023-12-31 0001027552 bsac:TransferredOverTimesMember 2023-01-01 2023-12-31 0001027552 bsac:TransferredAtAPointInTimesMember 2023-01-01 2023-12-31 0001027552 bsac:AccrualModelMember 2023-01-01 2023-12-31 0001027552 bsac:IndividualsAndPYMEsMember 2023-12-31 0001027552 bsac:CompaniesAndInstitutionsMember 2023-12-31 0001027552 bsac:GlobalInvestmentBankingMember 2023-12-31 0001027552 bsac:OthersMember 2023-12-31 0001027552 ifrs-full:ReportableSegmentsMember 2023-12-31 0001027552 bsac:TransferredOverTimesMember 2023-12-31 0001027552 bsac:TransferredAtAPointInTimesMember 2023-12-31 0001027552 bsac:AccrualModelMember 2023-12-31 0001027552 bsac:IndividualsAndPYMEsMember 2022-01-01 2022-12-31 0001027552 bsac:CompaniesAndInstitutionsMember 2022-01-01 2022-12-31 0001027552 bsac:GlobalInvestmentBankingMember 2022-01-01 2022-12-31 0001027552 bsac:OthersMember 2022-01-01 2022-12-31 0001027552 ifrs-full:ReportableSegmentsMember 2022-01-01 2022-12-31 0001027552 bsac:TransferredOverTimesMember 2022-01-01 2022-12-31 0001027552 bsac:TransferredAtAPointInTimesMember 2022-01-01 2022-12-31 0001027552 bsac:AccrualModelMember 2022-01-01 2022-12-31 0001027552 bsac:IndividualsAndPYMEsMember 2022-12-31 0001027552 bsac:CompaniesAndInstitutionsMember 2022-12-31 0001027552 bsac:GlobalInvestmentBankingMember 2022-12-31 0001027552 bsac:OthersMember 2022-12-31 0001027552 ifrs-full:ReportableSegmentsMember 2022-12-31 0001027552 bsac:TransferredOverTimesMember 2022-12-31 0001027552 bsac:TransferredAtAPointInTimesMember 2022-12-31 0001027552 bsac:AccrualModelMember 2022-12-31 0001027552 bsac:IndividualsAndPYMEsMember 2021-01-01 2021-12-31 0001027552 bsac:CompaniesAndInstitutionsMember 2021-01-01 2021-12-31 0001027552 bsac:GlobalInvestmentBankingMember 2021-01-01 2021-12-31 0001027552 bsac:OthersMember 2021-01-01 2021-12-31 0001027552 ifrs-full:ReportableSegmentsMember 2021-01-01 2021-12-31 0001027552 bsac:TransferredOverTimesMember 2021-01-01 2021-12-31 0001027552 bsac:TransferredAtAPointInTimesMember 2021-01-01 2021-12-31 0001027552 bsac:AccrualModelMember 2021-01-01 2021-12-31 0001027552 bsac:IndividualsAndPYMEsMember 2021-12-31 0001027552 bsac:CompaniesAndInstitutionsMember 2021-12-31 0001027552 bsac:GlobalInvestmentBankingMember 2021-12-31 0001027552 bsac:OthersMember 2021-12-31 0001027552 ifrs-full:ReportableSegmentsMember 2021-12-31 0001027552 bsac:TransferredOverTimesMember 2021-12-31 0001027552 bsac:TransferredAtAPointInTimesMember 2021-12-31 0001027552 bsac:AccrualModelMember 2021-12-31 0001027552 bsac:FinancialAssetsDerivativesContractsCategoryMember 2023-01-01 2023-12-31 0001027552 bsac:FinancialAssetsDerivativesContractsCategoryMember 2022-01-01 2022-12-31 0001027552 bsac:FinancialAssetsDerivativesContractsCategoryMember 2021-01-01 2021-12-31 0001027552 bsac:DebtFinancialInstrumentsMember 2023-01-01 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember 2022-01-01 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember 2021-01-01 2021-12-31 0001027552 bsac:OtherFinancialInstrumetsMember 2023-01-01 2023-12-31 0001027552 bsac:OtherFinancialInstrumetsMember 2022-01-01 2022-12-31 0001027552 bsac:OtherFinancialInstrumetsMember 2021-01-01 2021-12-31 0001027552 bsac:SubtotalMember 2023-01-01 2023-12-31 0001027552 bsac:SubtotalMember 2022-01-01 2022-12-31 0001027552 bsac:SubtotalMember 2021-01-01 2021-12-31 0001027552 bsac:SubtotalOneMember 2023-01-01 2023-12-31 0001027552 bsac:SubtotalOneMember 2022-01-01 2022-12-31 0001027552 bsac:SubtotalOneMember 2021-01-01 2021-12-31 0001027552 ifrs-full:FinancialAssetsAtAmortisedCostCategoryMember 2023-01-01 2023-12-31 0001027552 ifrs-full:FinancialAssetsAtAmortisedCostCategoryMember 2022-01-01 2022-12-31 0001027552 ifrs-full:FinancialAssetsAtAmortisedCostCategoryMember 2021-01-01 2021-12-31 0001027552 ifrs-full:FinancialAssetsAtFairValueThroughOtherComprehensiveIncomeCategoryMember 2023-01-01 2023-12-31 0001027552 ifrs-full:FinancialAssetsAtFairValueThroughOtherComprehensiveIncomeCategoryMember 2022-01-01 2022-12-31 0001027552 ifrs-full:FinancialAssetsAtFairValueThroughOtherComprehensiveIncomeCategoryMember 2021-01-01 2021-12-31 0001027552 ifrs-full:FinancialLiabilitiesAtAmortisedCostCategoryMember 2023-01-01 2023-12-31 0001027552 ifrs-full:FinancialLiabilitiesAtAmortisedCostCategoryMember 2022-01-01 2022-12-31 0001027552 ifrs-full:FinancialLiabilitiesAtAmortisedCostCategoryMember 2021-01-01 2021-12-31 0001027552 bsac:SubtotalTwoMember 2023-01-01 2023-12-31 0001027552 bsac:SubtotalTwoMember 2022-01-01 2022-12-31 0001027552 bsac:SubtotalTwoMember 2021-01-01 2021-12-31 0001027552 bsac:NetIncomeFromForeignCurrencyExchangeMember 2023-01-01 2023-12-31 0001027552 bsac:NetIncomeFromForeignCurrencyExchangeMember 2022-01-01 2022-12-31 0001027552 bsac:NetIncomeFromForeignCurrencyExchangeMember 2021-01-01 2021-12-31 0001027552 ifrs-full:FinancialAssetsAtFairValueThroughProfitOrLossCategoryMember 2023-01-01 2023-12-31 0001027552 ifrs-full:FinancialAssetsAtFairValueThroughProfitOrLossCategoryMember 2022-01-01 2022-12-31 0001027552 ifrs-full:FinancialAssetsAtFairValueThroughProfitOrLossCategoryMember 2021-01-01 2021-12-31 0001027552 bsac:OthersAssetsMember 2023-01-01 2023-12-31 0001027552 bsac:OthersAssetsMember 2022-01-01 2022-12-31 0001027552 bsac:OthersAssetsMember 2021-01-01 2021-12-31 0001027552 ifrs-full:FinancialLiabilitiesAtFairValueThroughProfitOrLossCategoryMember 2023-01-01 2023-12-31 0001027552 ifrs-full:FinancialLiabilitiesAtFairValueThroughProfitOrLossCategoryMember 2022-01-01 2022-12-31 0001027552 ifrs-full:FinancialLiabilitiesAtFairValueThroughProfitOrLossCategoryMember 2021-01-01 2021-12-31 0001027552 bsac:NetIncomeFromHegeAccountingOfForeignCurrencyRiskMember 2023-01-01 2023-12-31 0001027552 bsac:NetIncomeFromHegeAccountingOfForeignCurrencyRiskMember 2022-01-01 2022-12-31 0001027552 bsac:NetIncomeFromHegeAccountingOfForeignCurrencyRiskMember 2021-01-01 2021-12-31 0001027552 bsac:SubtotalThreeMember 2023-01-01 2023-12-31 0001027552 bsac:SubtotalThreeMember 2022-01-01 2022-12-31 0001027552 bsac:SubtotalThreeMember 2021-01-01 2021-12-31 0001027552 bsac:Stage1Member bsac:ExpectedCreditLossesCorporateAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:ExpectedCreditLossesOthersAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:ExpectedCreditLossesCorporateAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:ExpectedCreditLossesOthersAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:ExpectedCreditLossesCorporateAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:ExpectedCreditLossesOthersAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:ExpectedCreditLossesCorporateAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:ExpectedCreditLossesOthersAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:ExpectedCreditLossesCorporateAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:ExpectedCreditLossesOthersAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:ExpectedCreditLossesCorporateAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:ExpectedCreditLossesOthersAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:ExpectedCreditLossesCorporateAssessedMember 2021-01-01 2021-12-31 0001027552 bsac:Stage1Member bsac:ExpectedCreditLossesOthersAssessedMember 2021-01-01 2021-12-31 0001027552 bsac:Stage2Member bsac:ExpectedCreditLossesCorporateAssessedMember 2021-01-01 2021-12-31 0001027552 bsac:Stage2Member bsac:ExpectedCreditLossesOthersAssessedMember 2021-01-01 2021-12-31 0001027552 bsac:Stage3Member bsac:ExpectedCreditLossesCorporateAssessedMember 2021-01-01 2021-12-31 0001027552 bsac:Stage3Member bsac:ExpectedCreditLossesOthersAssessedMember 2021-01-01 2021-12-31 0001027552 bsac:CompaniesOfTheGroupMember 2023-12-31 0001027552 ifrs-full:AssociatesMember 2023-12-31 0001027552 ifrs-full:KeyManagementPersonnelOfEntityOrParentMember 2023-12-31 0001027552 ifrs-full:OtherRelatedPartiesMember 2023-12-31 0001027552 bsac:CompaniesOfTheGroupMember 2022-12-31 0001027552 ifrs-full:AssociatesMember 2022-12-31 0001027552 ifrs-full:KeyManagementPersonnelOfEntityOrParentMember 2022-12-31 0001027552 ifrs-full:OtherRelatedPartiesMember 2022-12-31 0001027552 bsac:CompaniesOfTheGroupMember 2021-12-31 0001027552 ifrs-full:AssociatesMember 2021-12-31 0001027552 ifrs-full:KeyManagementPersonnelOfEntityOrParentMember 2021-12-31 0001027552 ifrs-full:OtherRelatedPartiesMember 2021-12-31 0001027552 bsac:CompaniesOfTheGroupMember 2020-12-31 0001027552 ifrs-full:AssociatesMember 2020-12-31 0001027552 ifrs-full:KeyManagementPersonnelOfEntityOrParentMember 2020-12-31 0001027552 ifrs-full:OtherRelatedPartiesMember 2020-12-31 0001027552 bsac:CompaniesOfTheGroupMember 2023-01-01 2023-12-31 0001027552 ifrs-full:AssociatesMember 2023-01-01 2023-12-31 0001027552 ifrs-full:KeyManagementPersonnelOfEntityOrParentMember 2023-01-01 2023-12-31 0001027552 ifrs-full:OtherRelatedPartiesMember 2023-01-01 2023-12-31 0001027552 bsac:CompaniesOfTheGroupMember 2022-01-01 2022-12-31 0001027552 ifrs-full:AssociatesMember 2022-01-01 2022-12-31 0001027552 ifrs-full:KeyManagementPersonnelOfEntityOrParentMember 2022-01-01 2022-12-31 0001027552 ifrs-full:OtherRelatedPartiesMember 2022-01-01 2022-12-31 0001027552 bsac:CompaniesOfTheGroupMember 2021-01-01 2021-12-31 0001027552 ifrs-full:AssociatesMember 2021-01-01 2021-12-31 0001027552 ifrs-full:KeyManagementPersonnelOfEntityOrParentMember 2021-01-01 2021-12-31 0001027552 ifrs-full:OtherRelatedPartiesMember 2021-01-01 2021-12-31 0001027552 bsac:AssociatedCompaniesMember 2023-01-01 2023-12-31 0001027552 bsac:AssociatedCompaniesMember 2022-01-01 2022-12-31 0001027552 bsac:AssociatedCompaniesMember 2021-01-01 2021-12-31 0001027552 bsac:BancoSantanderSAMember 2023-01-01 2023-12-31 0001027552 bsac:BancoSantanderSAMember 2023-12-31 0001027552 bsac:SantanderBackOfficesGlobalesMayoristasSAMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderBackOfficesGlobalesMayoristasSAMember 2023-12-31 0001027552 bsac:SantanderChileHoldingSAMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderFactoringSAMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderFactoringSAMember 2023-12-31 0001027552 bsac:GesbanSantanderServiciosProfesionalesContablesLimitadaMember 2023-01-01 2023-12-31 0001027552 bsac:GesbanSantanderServiciosProfesionalesContablesLimitadaMember 2023-12-31 0001027552 bsac:SantanderGlobalServicesSLMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderGlobalServicesSLMember 2023-12-31 0001027552 bsac:SantanderInvestmentChileLimitadaMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderInvestmentChileLimitadaMember 2023-12-31 0001027552 bsac:SantanderGlobalTechnologyAndOperationsChileLimitadaMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderGlobalTechnologyAndOperationsChileLimitadaMember 2023-12-31 0001027552 bsac:UniversiaChileSAMember 2023-01-01 2023-12-31 0001027552 bsac:UniversiaChileSAMember 2023-12-31 0001027552 bsac:AquanimaChileSAMember 2023-01-01 2023-12-31 0001027552 bsac:AquanimaChileSAMember 2023-12-31 0001027552 bsac:SantanderAssetManagementSAAdministradoraGeneralDeFondosMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderAssetManagementSAAdministradoraGeneralDeFondosMember 2023-12-31 0001027552 bsac:CentroDeCompensacinAutomatizadoSAMember 2023-01-01 2023-12-31 0001027552 bsac:CentroDeCompensacinAutomatizadoSAMember 2023-12-31 0001027552 bsac:SociedadOperadoraDeLaCmaraDeCompensacinDePagosDeAltoValorSAMember 2023-01-01 2023-12-31 0001027552 bsac:SociedadOperadoraDeLaCmaraDeCompensacinDePagosDeAltoValorSAMember 2023-12-31 0001027552 bsac:ZurichSantanderSegurosGeneralesChileSAMember 2023-01-01 2023-12-31 0001027552 bsac:ZurichSantanderSegurosGeneralesChileSAMember 2023-12-31 0001027552 bsac:F1rstTecnologiaEInovaoLtdaMember 2023-01-01 2023-12-31 0001027552 bsac:F1rstTecnologiaEInovaoLtdaMember 2023-12-31 0001027552 bsac:SantanderGlobalTechnologyAndOperationsSLUnipersonalMember 2023-01-01 2023-12-31 0001027552 bsac:SantanderGlobalTechnologyAndOperationsSLUnipersonalMember 2023-12-31 0001027552 bsac:PagoNxtTradeServicesSLMember 2023-01-01 2023-12-31 0001027552 bsac:PagoNxtTradeServicesSLMember 2023-12-31 0001027552 bsac:MercuryTradeFinanceSolutionsSpAMember 2023-01-01 2023-12-31 0001027552 bsac:MercuryTradeFinanceSolutionsSpAMember 2023-12-31 0001027552 bsac:PagoNXTTradeChileSpAMember 2023-01-01 2023-12-31 0001027552 bsac:PagoNXTTradeChileSpAMember 2023-12-31 0001027552 bsac:BancoSantanderSAMember 2022-01-01 2022-12-31 0001027552 bsac:BancoSantanderSAMember 2022-12-31 0001027552 bsac:SantanderBackOfficesGlobalesMayoristasSAMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderBackOfficesGlobalesMayoristasSAMember 2022-12-31 0001027552 bsac:SantanderChileHoldingSAMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderFactoringSAMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderFactoringSAMember 2022-12-31 0001027552 bsac:GesbanSantanderServiciosProfesionalesContablesLimitadaMember 2022-01-01 2022-12-31 0001027552 bsac:GesbanSantanderServiciosProfesionalesContablesLimitadaMember 2022-12-31 0001027552 bsac:SantanderGestinDeRecaudacinYCobranzasLtdaMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderGestinDeRecaudacinYCobranzasLtdaMember 2022-12-31 0001027552 bsac:SantanderGlobalFacilitiesSLMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderGlobalFacilitiesSLMember 2022-12-31 0001027552 bsac:SantanderInvestmentChileLimitadaMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderInvestmentChileLimitadaMember 2022-12-31 0001027552 bsac:SantanderCorredoresDeBolsaLimitadaMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderCorredoresDeBolsaLimitadaMember 2022-12-31 0001027552 bsac:SantanderGlobalTechnologyAndOperationsChileLimitadaMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderGlobalTechnologyAndOperationsChileLimitadaMember 2022-12-31 0001027552 bsac:UniversiaChileSAMember 2022-01-01 2022-12-31 0001027552 bsac:UniversiaChileSAMember 2022-12-31 0001027552 bsac:AquanimaChileSAMember 2022-01-01 2022-12-31 0001027552 bsac:AquanimaChileSAMember 2022-12-31 0001027552 bsac:SantanderAssetManagementSAAdministradoraGeneralDeFondosMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderAssetManagementSAAdministradoraGeneralDeFondosMember 2022-12-31 0001027552 bsac:ZurichSantanderSegurosGeneralesChileSAMember 2022-01-01 2022-12-31 0001027552 bsac:ZurichSantanderSegurosGeneralesChileSAMember 2022-12-31 0001027552 bsac:SantanderConsumerFinanceLimitadaMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderConsumerFinanceLimitadaMember 2022-12-31 0001027552 bsac:SantanderGlobalTechnologyAndOperationsSLUnipersonalMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderGlobalTechnologyAndOperationsSLUnipersonalMember 2022-12-31 0001027552 bsac:MercuryTradeFinanceSolutionsSpAMember 2022-01-01 2022-12-31 0001027552 bsac:MercuryTradeFinanceSolutionsSpAMember 2022-12-31 0001027552 bsac:SociedadOperadoraDeTarjetasDePagoSantanderGetnetChileSAMember 2022-01-01 2022-12-31 0001027552 bsac:SociedadOperadoraDeTarjetasDePagoSantanderGetnetChileSAMember 2022-12-31 0001027552 bsac:SantanderCorredoraDeSegurosLimitadaMember 2022-01-01 2022-12-31 0001027552 bsac:SantanderCorredoraDeSegurosLimitadaMember 2022-12-31 0001027552 bsac:CentroDeCompensacinAutomatizadoSAMember 2022-01-01 2022-12-31 0001027552 bsac:CentroDeCompensacinAutomatizadoSAMember 2022-12-31 0001027552 bsac:SociedadOperadoraDeLaCmaraDeCompensacinDePagosDeAltoValorSAMember 2022-01-01 2022-12-31 0001027552 bsac:SociedadOperadoraDeLaCmaraDeCompensacinDePagosDeAltoValorSAMember 2022-12-31 0001027552 bsac:PagoNxtTradeServicesSLMember 2022-01-01 2022-12-31 0001027552 bsac:PagoNxtTradeServicesSLMember 2022-12-31 0001027552 bsac:Director1Member 2023-12-31 0001027552 bsac:Director1Member 2022-12-31 0001027552 bsac:Director1Member 2021-12-31 0001027552 bsac:ManagerMember 2023-12-31 0001027552 bsac:ManagerMember 2022-12-31 0001027552 bsac:ManagerMember 2021-12-31 0001027552 bsac:OtherPostretirementBenefitPlansDefinedBenefit1Member 2023-01-01 2023-12-31 0001027552 bsac:OtherPostretirementBenefitPlansDefinedBenefit1Member 2022-01-01 2022-12-31 0001027552 bsac:OtherPostretirementBenefitPlansDefinedBenefit1Member 2023-12-31 0001027552 bsac:OtherPostretirementBenefitPlansDefinedBenefit1Member 2022-12-31 0001027552 bsac:OtherPostretirementBenefitPlansDefinedBenefit1Member 2021-01-01 2021-12-31 0001027552 bsac:OtherPostretirementBenefitPlansDefinedBenefit1Member 2020-01-01 2020-12-31 0001027552 ifrs-full:FinancialGuaranteeContractsMember ifrs-full:TopOfRangeMember 2023-01-01 2023-12-31 0001027552 ifrs-full:FinancialGuaranteeContractsMember ifrs-full:BottomOfRangeMember 2023-01-01 2023-12-31 0001027552 ifrs-full:FinancialGuaranteeContractsMember ifrs-full:TopOfRangeMember 2022-01-01 2022-12-31 0001027552 ifrs-full:FinancialGuaranteeContractsMember ifrs-full:BottomOfRangeMember 2022-01-01 2022-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsFVTPLMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsFVTPLMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentFVOCIMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentFVOCIMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsFVOCIMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsFVOCIMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsForHedgeAccountingMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsForHedgeAccountingMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember 2022-12-31 0001027552 bsac:InterbankLoansMember 2023-12-31 0001027552 bsac:InterbankLoansMember 2022-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember 2022-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember 2023-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsForAccountingHedgesMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsForAccountingHedgesMember 2022-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember 2023-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember 2022-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember 2023-12-31 0001027552 bsac:InterBankBorrowingsCategoryMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsCategoryMember 2023-12-31 0001027552 bsac:IssuedDebtInstrumentsCategoryMember 2022-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember 2023-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember 2022-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember 2023-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember 2022-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsFBTPLMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsFBTPLMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsFBTPLMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsFBTPLMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsFBTPLMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsFBTPLMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsFBTPLMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsFBTPLMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:DebtInstrumentsAtFVOCIMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsFVOCIMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsFVOCIMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsFVOCIMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsFVOCIMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:OtherFinancialInstrumentsFVOCIMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsFVOCIMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsFVOCIMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:OtherFinancialInstrumentsFVOCIMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsForHedgeAccountingMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsForHedgeAccountingMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsForHedgeAccountingMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsForHedgeAccountingMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsForHedgeAccountingMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsForHedgeAccountingMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsForHedgeAccountingMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsForHedgeAccountingMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember 2023-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember 2022-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialAssetsGuaranteeDepositsMarginAccountsCategoryMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsFVTPLMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsForAccountingHedgesMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsForAccountingHedgesMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsForAccountingHedgesMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsForAccountingHedgesMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsForAccountingHedgesMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsForAccountingHedgesMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsForAccountingHedgesMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsForAccountingHedgesMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember 2022-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialLiabilitiesGuaranteesReceivedMarginAccountsCategoryMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesDepositsAndInterbankBorrowingsCategoryMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesDepositsAndInterbankBorrowingsCategoryMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesDepositsAndInterbankBorrowingsCategoryMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesDepositsAndInterbankBorrowingsCategoryMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:InterbankBorrowingsMember 2023-12-31 0001027552 bsac:InterbankBorrowingsMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:InterbankBorrowingsMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:InterbankBorrowingsMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesIssuedDebtInstrumentsAndOtherFinancialLiabilitiesCategoryMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesIssuedDebtInstrumentsAndOtherFinancialLiabilitiesCategoryMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesIssuedDebtInstrumentsAndOtherFinancialLiabilitiesCategoryMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:FinancialLiabilitiesIssuedDebtInstrumentsAndOtherFinancialLiabilitiesCategoryMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember ifrs-full:Level1OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember ifrs-full:Level2OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember ifrs-full:Level3OfFairValueHierarchyMember 2023-12-31 0001027552 bsac:DebtFinancialInstrumentsMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:DebtFinancialInstrumentsMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:LoansAndAccountReceivableFromCustomersMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember 2022-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:DepositsOtherDemandLiabilitiesMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:TimeDepositsAndOtherTimeLiabilitiesMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:InterbankBorrowingsMember 2022-12-31 0001027552 bsac:InterbankBorrowingsMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:InterbankBorrowingsMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:InterbankBorrowingsMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsCategoryMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsCategoryMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:IssuedDebtInstrumentsCategoryMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:OtherFinancialLiabilitiesMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember ifrs-full:Level1OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember ifrs-full:Level2OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:RegulatoryCapitalFinancialInstrumentsMember ifrs-full:Level3OfFairValueHierarchyMember 2022-12-31 0001027552 bsac:FinancialAssetsDerivativesContractsCategoryMember ifrs-full:Level3OfFairValueHierarchyMember bsac:InternalRateOfReturnMethodMember 2023-01-01 2023-12-31 0001027552 bsac:FinancialAssetsDerivativesContractsCategoryMember ifrs-full:Level3OfFairValueHierarchyMember bsac:PresentValueMethodMember 2022-01-01 2022-12-31 0001027552 bsac:FinancialAssetsDerivativesContractsCategoryMember ifrs-full:Level3OfFairValueHierarchyMember bsac:InternalRateOfReturnMethodMember 2022-01-01 2022-12-31 0001027552 bsac:AssetMember 2022-12-31 0001027552 bsac:LiabilitieMember 2022-12-31 0001027552 bsac:AssetMember 2023-01-01 2023-12-31 0001027552 bsac:LiabilitieMember 2023-01-01 2023-12-31 0001027552 bsac:AssetMember 2023-12-31 0001027552 bsac:LiabilitieMember 2023-12-31 0001027552 bsac:AssetMember 2021-12-31 0001027552 bsac:LiabilitieMember 2021-12-31 0001027552 bsac:AssetMember 2022-01-01 2022-12-31 0001027552 bsac:LiabilitieMember 2022-01-01 2022-12-31 0001027552 bsac:AssetMember 2020-12-31 0001027552 bsac:LiabilitieMember 2020-12-31 0001027552 bsac:AssetMember 2021-01-01 2021-12-31 0001027552 bsac:LiabilitieMember 2021-01-01 2021-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeAccountingMember 2023-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostNetMember 2023-12-31 0001027552 bsac:FinancialAssetsDerivativesContractsCategoryMember 2023-12-31 0001027552 bsac:InvestmentsUnderResaleAgreementsLiabilitiesMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeAccountingMember 2022-12-31 0001027552 bsac:LoansAndAccountsReceivableAtAmortizedCostNetMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsAndHedgeAccountingMember 2022-12-31 0001027552 bsac:InvestmentsUnderResaleAgreementsLiabilitiesMember 2022-12-31 0001027552 bsac:FinancialLiabilitiesDepositsAndInterbankBorrowingsCategoryMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsWithCollateralAgreementThresholdEqualToZeroMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsWithCollateralAgreementThresholdEqualToZeroMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsWithNonzeroThresholdCollateralAgreementMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsWithNonzeroThresholdCollateralAgreementMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsWithoutCollateralAgreementMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsWithoutCollateralAgreementMember 2022-12-31 0001027552 ifrs-full:Level1OfFairValueHierarchyMember 2023-01-01 2023-12-31 0001027552 ifrs-full:Level2OfFairValueHierarchyMember 2023-01-01 2023-12-31 0001027552 bsac:ChileanCentralBankMember 2023-12-31 0001027552 bsac:GeneralBankingMember 2023-01-01 2023-12-31 0001027552 ifrs-full:TopOfRangeMember 2020-08-21 2020-08-21 0001027552 ifrs-full:BottomOfRangeMember 2020-08-21 2020-08-21 0001027552 2023-03-31 2023-03-31 0001027552 2023-05-24 2023-05-24 0001027552 bsac:ConsolidatedOneMember ifrs-full:TopOfRangeMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ConsolidatedOneMember ifrs-full:TopOfRangeMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:ConsolidatedOneMember ifrs-full:BottomOfRangeMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ConsolidatedOneMember ifrs-full:BottomOfRangeMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:ConsolidatedOneMember ifrs-full:WeightedAverageMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ConsolidatedOneMember ifrs-full:WeightedAverageMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FixedIncomeInvestments1Member ifrs-full:TopOfRangeMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FixedIncomeInvestments1Member ifrs-full:TopOfRangeMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FixedIncomeInvestments1Member ifrs-full:BottomOfRangeMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FixedIncomeInvestments1Member ifrs-full:BottomOfRangeMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FixedIncomeInvestments1Member ifrs-full:WeightedAverageMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FixedIncomeInvestments1Member ifrs-full:WeightedAverageMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:VariableIncomeInvestmentsMember ifrs-full:TopOfRangeMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:VariableIncomeInvestmentsMember ifrs-full:BottomOfRangeMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:VariableIncomeInvestmentsMember ifrs-full:BottomOfRangeMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:VariableIncomeInvestmentsMember ifrs-full:WeightedAverageMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ForeignCurrencyInvestmentsMember ifrs-full:TopOfRangeMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ForeignCurrencyInvestmentsMember ifrs-full:TopOfRangeMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:ForeignCurrencyInvestmentsMember ifrs-full:BottomOfRangeMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ForeignCurrencyInvestmentsMember ifrs-full:BottomOfRangeMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:ForeignCurrencyInvestmentsMember ifrs-full:WeightedAverageMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ForeignCurrencyInvestmentsMember ifrs-full:WeightedAverageMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:LossLimitMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:LossLimitMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:HighMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:HighMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:MaximumLowMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:MaximumLowMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 srt:WeightedAverageMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 srt:WeightedAverageMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:LossLimitMember bsac:MarketRisk1Member 2023-12-31 0001027552 bsac:LossLimitMember bsac:MarketRisk1Member 2022-12-31 0001027552 bsac:HighMember bsac:MarketRisk1Member 2023-12-31 0001027552 bsac:HighMember bsac:MarketRisk1Member 2022-12-31 0001027552 bsac:MaximumLowMember bsac:MarketRisk1Member 2023-12-31 0001027552 bsac:MaximumLowMember bsac:MarketRisk1Member 2022-12-31 0001027552 srt:WeightedAverageMember bsac:MarketRisk1Member 2023-12-31 0001027552 srt:WeightedAverageMember bsac:MarketRisk1Member 2022-12-31 0001027552 bsac:LossLimitMember bsac:FinancialManagementPortfolioConsolidatedMember 2023-12-31 0001027552 bsac:LossLimitMember bsac:FinancialManagementPortfolioConsolidatedMember 2022-12-31 0001027552 bsac:HighMember bsac:FinancialManagementPortfolioConsolidatedMember 2023-12-31 0001027552 bsac:HighMember bsac:FinancialManagementPortfolioConsolidatedMember 2022-12-31 0001027552 bsac:MaximumLowMember bsac:FinancialManagementPortfolioConsolidatedMember 2023-12-31 0001027552 bsac:MaximumLowMember bsac:FinancialManagementPortfolioConsolidatedMember 2022-12-31 0001027552 srt:WeightedAverageMember bsac:FinancialManagementPortfolioConsolidatedMember 2023-12-31 0001027552 srt:WeightedAverageMember bsac:FinancialManagementPortfolioConsolidatedMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:InternalCreditGrades1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:InternalCreditGrades2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:InternalCreditGrades3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades15Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades15Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades15Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:InternalCreditGrades15Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades16Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades16Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades16Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:InternalCreditGrades16Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades17Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades17Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades17Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:InternalCreditGrades17Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:B1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:B1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:B1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:B1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:B2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:B2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:B2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:B2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:B3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:B3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:B3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:B3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:B4Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:B4Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:B4Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:B4Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:C1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:C1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:C1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:C1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:C2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:C2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:C2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:C2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:C3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:C3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:C3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:C3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:C4Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:C4Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:C4Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:C4Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:C5Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:C5Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:C5Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:C5Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:C6Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:C6Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:C6Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:C6Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CorporatePortfolioMember bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:OtherCommercialMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:OtherCommercialMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:OtherCommercialMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:OtherCommercialMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member ifrs-full:MortgagesMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member ifrs-full:MortgagesMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member ifrs-full:MortgagesMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 ifrs-full:MortgagesMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:ConsumersMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:ConsumersMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:ConsumersMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:ConsumersMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:SubtotalMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:SubtotalMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:SubtotalMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:SubtotalMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:OtherLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CommercialPortfolioMember bsac:InternalCreditGrades1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CommercialPortfolioMember bsac:InternalCreditGrades1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CommercialPortfolioMember bsac:InternalCreditGrades1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CommercialPortfolioMember bsac:InternalCreditGrades1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CorporatePortfolioMember bsac:InternalCreditGrades2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CorporatePortfolioMember bsac:InternalCreditGrades3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades15Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades15Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades15Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CorporatePortfolioMember bsac:InternalCreditGrades15Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades16Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades16Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades16Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CorporatePortfolioMember bsac:InternalCreditGrades16Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades17Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades17Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:InternalCreditGrades17Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CorporatePortfolioMember bsac:InternalCreditGrades17Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:B1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:B1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:B1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CorporatePortfolioMember bsac:B1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:B2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:B2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:B2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CorporatePortfolioMember bsac:B2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:B3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:B3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:B3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CorporatePortfolioMember bsac:B3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:B4Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:B4Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:B4Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CorporatePortfolioMember bsac:B4Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:C1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:C1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:C1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CorporatePortfolioMember bsac:C1Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:C2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:C2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:C2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CorporatePortfolioMember bsac:C2Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:C3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:C3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:C3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CorporatePortfolioMember bsac:C3Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:C4Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:C4Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:C4Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CorporatePortfolioMember bsac:C4Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:C5Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:C5Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:C5Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CorporatePortfolioMember bsac:C5Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:C6Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:C6Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:C6Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CorporatePortfolioMember bsac:C6Member bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CorporatePortfolioMember bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CorporatePortfolioMember bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CorporatePortfolioMember bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CorporatePortfolioMember bsac:ExpectedCreditLossesCorporateAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:OtherCommercialMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:OtherCommercialMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:OtherCommercialMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:OtherCommercialMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member ifrs-full:MortgagesMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member ifrs-full:MortgagesMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member ifrs-full:MortgagesMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 ifrs-full:MortgagesMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:ConsumersMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:ConsumersMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:ConsumersMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:ConsumersMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:SubtotalMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:SubtotalMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:SubtotalMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:SubtotalMember bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:OtherLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:StageTwoMember ifrs-full:MortgagesMember bsac:CollectiveMarksOneMember 2022-01-01 2022-12-31 0001027552 bsac:StageTwoMember ifrs-full:MortgagesMember ifrs-full:ExpectedCreditLossesIndividuallyAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:StageTwoMember bsac:RevolvingCreditCardsMember bsac:CollectiveMarksOneMember 2022-01-01 2022-12-31 0001027552 bsac:StageTwoMember bsac:OverallMonitornigSMEMember bsac:CollectiveMarksOneMember 2022-01-01 2022-12-31 0001027552 bsac:StageTwoMember bsac:CorporateCorporateSMEMember ifrs-full:ExpectedCreditLossesIndividuallyAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:StageTwoMember bsac:CorporateMiddleMarketMember ifrs-full:ExpectedCreditLossesIndividuallyAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:StageTwoMember bsac:CorporateCorporateAndInvestmentBankingMember ifrs-full:ExpectedCreditLossesIndividuallyAssessedMember 2022-01-01 2022-12-31 0001027552 bsac:StageTwoMember ifrs-full:MortgagesMember bsac:CollectiveMarksOneMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember ifrs-full:MortgagesMember ifrs-full:ExpectedCreditLossesIndividuallyAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember bsac:RevolvingCreditCardsMember bsac:CollectiveMarksOneMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember bsac:OverallMonitornigSMEMember bsac:CollectiveMarksOneMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember bsac:CorporateCorporateSMEMember ifrs-full:ExpectedCreditLossesIndividuallyAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember bsac:CorporateMiddleMarketMember ifrs-full:ExpectedCreditLossesIndividuallyAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember bsac:CorporateLoansCorporateAndInvestmentBankingMember ifrs-full:ExpectedCreditLossesIndividuallyAssessedMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember ifrs-full:MortgagesMember bsac:CollectiveMarksOneMember bsac:IrregularPortfolioMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember ifrs-full:MortgagesMember ifrs-full:ExpectedCreditLossesIndividuallyAssessedMember bsac:IrregularPortfolioMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember bsac:RevolvingCreditCardsMember bsac:CollectiveMarksOneMember bsac:IrregularPortfolioMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember bsac:OverallMonitornigSMEMember bsac:CollectiveMarksOneMember bsac:IrregularPortfolioMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember bsac:CorporateCorporateSMEMember ifrs-full:ExpectedCreditLossesIndividuallyAssessedMember bsac:IrregularPortfolioMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember bsac:CorporateMiddleMarketMember ifrs-full:ExpectedCreditLossesIndividuallyAssessedMember bsac:IrregularPortfolioMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember ifrs-full:MortgagesMember bsac:CollectiveMarksOneMember bsac:RestructuredMarkedForMonitoringMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember ifrs-full:MortgagesMember ifrs-full:ExpectedCreditLossesIndividuallyAssessedMember bsac:RestructuredMarkedForMonitoringMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember bsac:RevolvingCreditCardsMember bsac:CollectiveMarksOneMember bsac:RestructuredMarkedForMonitoringMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember bsac:OverallMonitornigSMEMember bsac:CollectiveMarksOneMember bsac:RestructuredMarkedForMonitoringMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember bsac:CorporateCorporateSMEMember ifrs-full:ExpectedCreditLossesIndividuallyAssessedMember bsac:RestructuredMarkedForMonitoringMember 2023-01-01 2023-12-31 0001027552 bsac:StageTwoMember bsac:CorporateMiddleMarketMember ifrs-full:ExpectedCreditLossesIndividuallyAssessedMember bsac:RestructuredMarkedForMonitoringMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member ifrs-full:ExpectedCreditLossesCollectivelyAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage2Member ifrs-full:ExpectedCreditLossesCollectivelyAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage3Member ifrs-full:ExpectedCreditLossesCollectivelyAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 ifrs-full:ExpectedCreditLossesCollectivelyAssessedMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:Stage1Member ifrs-full:ExpectedCreditLossesCollectivelyAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage2Member ifrs-full:ExpectedCreditLossesCollectivelyAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:Stage3Member ifrs-full:ExpectedCreditLossesCollectivelyAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 ifrs-full:ExpectedCreditLossesCollectivelyAssessedMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:ChileanCentralBankInterestRatesMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:UnfavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:ChileanCentralBankInterestRatesMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:UnfavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:ChileanCentralBankInterestRatesMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:BaseScenarioMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:ChileanCentralBankInterestRatesMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:FavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:ChileanCentralBankInterestRatesMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:FavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:UnemploymentRateMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:UnfavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:UnemploymentRateMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:UnfavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:UnemploymentRateMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:BaseScenarioMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:UnemploymentRateMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:FavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:UnemploymentRateMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:FavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:HousingPriceGrowthMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:UnfavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:HousingPriceGrowthMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:UnfavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:HousingPriceGrowthMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:BaseScenarioMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:HousingPriceGrowthMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:FavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:HousingPriceGrowthMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:FavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:GrossDomesticProductGrowthMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:UnfavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:GrossDomesticProductGrowthMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:UnfavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:GrossDomesticProductGrowthMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:BaseScenarioMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:GrossDomesticProductGrowthMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:FavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:GrossDomesticProductGrowthMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:FavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:ConsumerPriceIndexMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:UnfavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:ConsumerPriceIndexMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:UnfavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:ConsumerPriceIndexMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:BaseScenarioMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:ConsumerPriceIndexMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:FavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:ConsumerPriceIndexMember bsac:AverageEstimatesTwoThousandTwentyThreeMember bsac:FavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:OfficialInterestRateMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:UnfavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:OfficialInterestRateMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:UnfavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:OfficialInterestRateMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:BaseScenarioMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:OfficialInterestRateMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:FavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:OfficialInterestRateMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:FavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:UnemploymentRateMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:UnfavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:UnemploymentRateMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:UnfavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:UnemploymentRateMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:BaseScenarioMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:UnemploymentRateMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:FavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:UnemploymentRateMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:FavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:HousingPriceGrowthMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:UnfavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:HousingPriceGrowthMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:UnfavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:HousingPriceGrowthMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:BaseScenarioMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:HousingPriceGrowthMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:FavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:HousingPriceGrowthMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:FavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:GrossDomesticProductGrowthMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:UnfavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:GrossDomesticProductGrowthMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:UnfavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:GrossDomesticProductGrowthMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:BaseScenarioMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:GrossDomesticProductGrowthMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:FavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:GrossDomesticProductGrowthMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:FavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:ConsumerPriceIndexsMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:UnfavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:ConsumerPriceIndexsMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:UnfavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:ConsumerPriceIndexsMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:BaseScenarioMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:ConsumerPriceIndexsMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:FavorableScenarioOneMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:ConsumerPriceIndexsMember bsac:AverageEstimatesTwoThousandTwentyFourMember bsac:FavorableScenarioTwoMember bsac:MacroeconomicMember 2023-01-01 2023-12-31 0001027552 bsac:LocalScenarioMember bsac:ProbabilityWeightingMember 2023-01-01 2023-12-31 0001027552 bsac:GlobalScenarioMember bsac:ProbabilityWeightingMember 2023-01-01 2023-12-31 0001027552 bsac:MacroeconomicMember 2023-12-31 0001027552 bsac:MacroeconomicMember 2022-12-31 0001027552 bsac:MacroeconomicMember bsac:FavorableScenariosMember 2023-12-31 0001027552 bsac:MacroeconomicMember bsac:FavorableScenariosMember 2022-12-31 0001027552 bsac:MacroeconomicMember bsac:FavorableScenarioOneMember 2023-12-31 0001027552 bsac:MacroeconomicMember bsac:FavorableScenarioOneMember 2022-12-31 0001027552 bsac:MacroeconomicMember bsac:BaseScenarioMember 2023-12-31 0001027552 bsac:MacroeconomicMember bsac:BaseScenarioMember 2022-12-31 0001027552 bsac:MacroeconomicMember bsac:UnfavorableScenarioTwoMember 2023-12-31 0001027552 bsac:MacroeconomicMember bsac:UnfavorableScenarioTwoMember 2022-12-31 0001027552 bsac:MacroeconomicMember bsac:UnfavorableScenariosMember 2023-12-31 0001027552 bsac:MacroeconomicMember bsac:UnfavorableScenariosMember 2022-12-31 0001027552 bsac:MacroeconomicMember bsac:FavorableScenarioTwoMember 2023-12-31 0001027552 bsac:MacroeconomicMember bsac:FavorableScenarioTwoMember 2022-12-31 0001027552 bsac:MacroeconomicMember bsac:UnfavorableScenarioOneMember 2023-12-31 0001027552 bsac:MacroeconomicMember bsac:UnfavorableScenarioOneMember 2022-12-31 0001027552 bsac:AgricultureandLivestockSectorMember bsac:Stage1Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:AgricultureandLivestockSectorMember bsac:Stage2Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:AgricultureandLivestockSectorMember bsac:Stage3Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:AgricultureandLivestockSectorMember bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:AgricultureandLivestockSectorMember bsac:Stage1Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:AgricultureandLivestockSectorMember bsac:Stage2Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:AgricultureandLivestockSectorMember bsac:Stage3Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:AgricultureandLivestockSectorMember bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FruitCultivationMember bsac:Stage1Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FruitCultivationMember bsac:Stage2Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FruitCultivationMember bsac:Stage3Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FruitCultivationMember bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FruitCultivationMember bsac:Stage1Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FruitCultivationMember bsac:Stage2Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FruitCultivationMember bsac:Stage3Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FruitCultivationMember bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:ForestMember bsac:Stage1Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ForestMember bsac:Stage2Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ForestMember bsac:Stage3Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ForestMember bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ForestMember bsac:Stage1Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:ForestMember bsac:Stage2Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:ForestMember bsac:Stage3Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:ForestMember bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FishingSectorMember bsac:Stage1Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FishingSectorMember bsac:Stage2Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FishingSectorMember bsac:Stage3Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FishingSectorMember bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FishingSectorMember bsac:Stage1Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FishingSectorMember bsac:Stage2Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FishingSectorMember bsac:Stage3Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FishingSectorMember bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:MiningSectorMember bsac:Stage1Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:MiningSectorMember bsac:Stage2Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:MiningSectorMember bsac:Stage3Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:MiningSectorMember bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:MiningSectorMember bsac:Stage1Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:MiningSectorMember bsac:Stage2Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:MiningSectorMember bsac:Stage3Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:MiningSectorMember bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:OilAndNaturalGasMember bsac:Stage1Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:OilAndNaturalGasMember bsac:Stage2Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:OilAndNaturalGasMember bsac:Stage3Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:OilAndNaturalGasMember bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:OilAndNaturalGasMember bsac:Stage1Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:OilAndNaturalGasMember bsac:Stage2Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:OilAndNaturalGasMember bsac:Stage3Member bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:OilAndNaturalGasMember bsac:CommercialsLoanMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FoodBeveragesAndTobaccoMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FoodBeveragesAndTobaccoMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FoodBeveragesAndTobaccoMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FoodBeveragesAndTobaccoMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FoodBeveragesAndTobaccoMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FoodBeveragesAndTobaccoMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FoodBeveragesAndTobaccoMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FoodBeveragesAndTobaccoMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:TextileLeatherAndFootwearMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:TextileLeatherAndFootwearMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:TextileLeatherAndFootwearMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:TextileLeatherAndFootwearMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:TextileLeatherAndFootwearMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:TextileLeatherAndFootwearMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:TextileLeatherAndFootwearMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:TextileLeatherAndFootwearMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:WoodAndFurnitureMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:WoodAndFurnitureMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:WoodAndFurnitureMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:WoodAndFurnitureMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:WoodAndFurnitureMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:WoodAndFurnitureMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:WoodAndFurnitureMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:WoodAndFurnitureMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:CellulosePaperAndPrintingMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:CellulosePaperAndPrintingMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:CellulosePaperAndPrintingMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:CellulosePaperAndPrintingMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:CellulosePaperAndPrintingMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:CellulosePaperAndPrintingMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:CellulosePaperAndPrintingMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:CellulosePaperAndPrintingMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:ChemicalsAndPetroleumDerivativesMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ChemicalsAndPetroleumDerivativesMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ChemicalsAndPetroleumDerivativesMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ChemicalsAndPetroleumDerivativesMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ChemicalsAndPetroleumDerivativesMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:ChemicalsAndPetroleumDerivativesMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:ChemicalsAndPetroleumDerivativesMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:ChemicalsAndPetroleumDerivativesMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:MetallicNonmetallicMachineryOrOtherMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:MetallicNonmetallicMachineryOrOtherMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:MetallicNonmetallicMachineryOrOtherMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:MetallicNonmetallicMachineryOrOtherMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:MetallicNonmetallicMachineryOrOtherMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:MetallicNonmetallicMachineryOrOtherMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:MetallicNonmetallicMachineryOrOtherMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:MetallicNonmetallicMachineryOrOtherMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:OtherManufacturingIndustriesMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:OtherManufacturingIndustriesMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:OtherManufacturingIndustriesMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:OtherManufacturingIndustriesMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:OtherManufacturingIndustriesMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:OtherManufacturingIndustriesMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:OtherManufacturingIndustriesMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:OtherManufacturingIndustriesMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:ElectricityGasAndWterMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ElectricityGasAndWterMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ElectricityGasAndWterMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ElectricityGasAndWterMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:ElectricityGasAndWterMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:ElectricityGasAndWterMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:ElectricityGasAndWterMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:ElectricityGasAndWterMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:HomeBuildingsMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:HomeBuildingsMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:HomeBuildingsMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:HomeBuildingsMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:HomeBuildingsMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:HomeBuildingsMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:HomeBuildingsMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:HomeBuildingsMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:NonresidentialConstructionMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:NonresidentialConstructionMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:NonresidentialConstructionMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:NonresidentialConstructionMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:NonresidentialConstructionMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:NonresidentialConstructionMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:NonresidentialConstructionMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:NonresidentialConstructionMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:WholesaleTradeMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:WholesaleTradeMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:WholesaleTradeMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:WholesaleTradeMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:WholesaleTradeMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:WholesaleTradeMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:WholesaleTradeMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:WholesaleTradeMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:RetailTradeRestaurantsAndHotelsMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:RetailTradeRestaurantsAndHotelsMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:RetailTradeRestaurantsAndHotelsMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:RetailTradeRestaurantsAndHotelsMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:RetailTradeRestaurantsAndHotelsMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:RetailTradeRestaurantsAndHotelsMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:RetailTradeRestaurantsAndHotelsMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:RetailTradeRestaurantsAndHotelsMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:TransportAndStorageMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:TransportAndStorageMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:TransportAndStorageMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:TransportAndStorageMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:TransportAndStorageMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:TransportAndStorageMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:TransportAndStorageMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:TransportAndStorageMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:TelecommunicationsMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:TelecommunicationsMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:TelecommunicationsMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:TelecommunicationsMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:TelecommunicationsMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:TelecommunicationsMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:TelecommunicationsMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:TelecommunicationsMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FinancialServicesMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FinancialServicesMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FinancialServicesMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FinancialServicesMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:FinancialServicesMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FinancialServicesMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FinancialServicesMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:FinancialServicesMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:RealEstateAndOtherFinancialServicesMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:RealEstateAndOtherFinancialServicesMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:RealEstateAndOtherFinancialServicesMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:RealEstateAndOtherFinancialServicesMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:RealEstateAndOtherFinancialServicesMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:RealEstateAndOtherFinancialServicesMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:RealEstateAndOtherFinancialServicesMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:RealEstateAndOtherFinancialServicesMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:SocialServicesAndOtherCommunityServicesMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:SocialServicesAndOtherCommunityServicesMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:SocialServicesAndOtherCommunityServicesMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:SocialServicesAndOtherCommunityServicesMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2023-12-31 0001027552 bsac:SocialServicesAndOtherCommunityServicesMember bsac:Stage1Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:SocialServicesAndOtherCommunityServicesMember bsac:Stage2Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:SocialServicesAndOtherCommunityServicesMember bsac:Stage3Member bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:SocialServicesAndOtherCommunityServicesMember bsac:ManufacturingIndustryMember ifrs-full:MarketRiskMember 2022-12-31 0001027552 bsac:Stage1Member bsac:ManufacturingIndustryMember bsac:SubtotalMember 2023-12-31 0001027552 bsac:Stage2Member bsac:ManufacturingIndustryMember bsac:SubtotalMember 2023-12-31 0001027552 bsac:Stage3Member bsac:ManufacturingIndustryMember bsac:SubtotalMember 2023-12-31 0001027552 bsac:ManufacturingIndustryMember bsac:SubtotalMember 2023-12-31 0001027552 bsac:Stage1Member bsac:ManufacturingIndustryMember bsac:SubtotalMember 2022-12-31 0001027552 bsac:Stage2Member bsac:ManufacturingIndustryMember bsac:SubtotalMember 2022-12-31 0001027552 bsac:Stage3Member bsac:ManufacturingIndustryMember bsac:SubtotalMember 2022-12-31 0001027552 bsac:ManufacturingIndustryMember bsac:SubtotalMember 2022-12-31 0001027552 bsac:Stage1Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:Stage2Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:Stage3Member bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:MortgageLoansMember 2023-12-31 0001027552 bsac:Stage3Member bsac:MortgageLoansMember 2022-12-31 0001027552 bsac:Stage3Member bsac:ConsumerLoansOneMember 2023-12-31 0001027552 bsac:Stage3Member bsac:ConsumerLoansOneMember 2022-12-31 0001027552 bsac:Stage3Member bsac:InterbankLoansMember 2023-12-31 0001027552 bsac:Stage1Member bsac:InterbankLoansMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:InterbankLoansMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:InterbankLoansMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:CommercialLoansMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CommercialLoansMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:CommercialLoansMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:CommercialLoansMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:CommercialLoansMember bsac:OneToThirtyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CommercialLoansMember bsac:OneToThirtyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CommercialLoansMember bsac:OneToThirtyDaysPastDueMember 2023-12-31 0001027552 bsac:CommercialLoansMember bsac:OneToThirtyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CommercialLoansMember bsac:OneToThirtyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:CommercialLoansMember bsac:OneToThirtyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:CommercialLoansMember bsac:OneToThirtyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:CommercialLoansMember bsac:OneToThirtyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:CommercialLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CommercialLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CommercialLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-12-31 0001027552 bsac:CommercialLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CommercialLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:CommercialLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:CommercialLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-01-01 2023-12-31 0001027552 bsac:CommercialLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:CommercialLoansMember bsac:OverNinetyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage2Member bsac:CommercialLoansMember bsac:OverNinetyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage3Member bsac:CommercialLoansMember bsac:OverNinetyDaysPastDueMember 2023-12-31 0001027552 bsac:CommercialLoansMember bsac:OverNinetyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage1Member bsac:CommercialLoansMember bsac:OverNinetyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:CommercialLoansMember bsac:OverNinetyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:CommercialLoansMember bsac:OverNinetyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:CommercialLoansMember bsac:OverNinetyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:MortgageLoansMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:MortgageLoansMember bsac:OneToThirtyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage2Member bsac:MortgageLoansMember bsac:OneToThirtyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage3Member bsac:MortgageLoansMember bsac:OneToThirtyDaysPastDueMember 2023-12-31 0001027552 bsac:MortgageLoansMember bsac:OneToThirtyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage1Member bsac:MortgageLoansMember bsac:OneToThirtyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:MortgageLoansMember bsac:OneToThirtyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:MortgageLoansMember bsac:OneToThirtyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:MortgageLoansMember bsac:OneToThirtyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:MortgageLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-12-31 0001027552 bsac:Stage2Member bsac:MortgageLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-12-31 0001027552 bsac:Stage3Member bsac:MortgageLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-12-31 0001027552 bsac:MortgageLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-12-31 0001027552 bsac:Stage1Member bsac:MortgageLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:MortgageLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:MortgageLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-01-01 2023-12-31 0001027552 bsac:MortgageLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:MortgageLoansMember bsac:OverNinetyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage2Member bsac:MortgageLoansMember bsac:OverNinetyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage3Member bsac:MortgageLoansMember bsac:OverNinetyDaysPastDueMember 2023-12-31 0001027552 bsac:MortgageLoansMember bsac:OverNinetyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage1Member bsac:MortgageLoansMember bsac:OverNinetyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member bsac:MortgageLoansMember bsac:OverNinetyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member bsac:MortgageLoansMember bsac:OverNinetyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:MortgageLoansMember bsac:OverNinetyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember 2023-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:OneToThirtyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:OneToThirtyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:OneToThirtyDaysPastDueMember 2023-12-31 0001027552 ifrs-full:ConsumerLoansMember bsac:OneToThirtyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:OneToThirtyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:OneToThirtyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:OneToThirtyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 ifrs-full:ConsumerLoansMember bsac:OneToThirtyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-12-31 0001027552 ifrs-full:ConsumerLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-01-01 2023-12-31 0001027552 ifrs-full:ConsumerLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:OverNinetyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:OverNinetyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:OverNinetyDaysPastDueMember 2023-12-31 0001027552 ifrs-full:ConsumerLoansMember bsac:OverNinetyDaysPastDueMember 2023-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:OverNinetyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:OverNinetyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:OverNinetyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 ifrs-full:ConsumerLoansMember bsac:OverNinetyDaysPastDueMember 2023-01-01 2023-12-31 0001027552 bsac:Stage1Member bsac:InterbankLoansMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:CommercialLoansMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CommercialLoansMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:CommercialLoansMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:CommercialLoansMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:CommercialLoansMember bsac:OneToThirtyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CommercialLoansMember bsac:OneToThirtyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CommercialLoansMember bsac:OneToThirtyDaysPastDueMember 2022-12-31 0001027552 bsac:CommercialLoansMember bsac:OneToThirtyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CommercialLoansMember bsac:OneToThirtyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:CommercialLoansMember bsac:OneToThirtyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:CommercialLoansMember bsac:OneToThirtyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:CommercialLoansMember bsac:OneToThirtyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:CommercialLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CommercialLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CommercialLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-12-31 0001027552 bsac:CommercialLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CommercialLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:CommercialLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:CommercialLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-01-01 2022-12-31 0001027552 bsac:CommercialLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:CommercialLoansMember bsac:OverNinetyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage2Member bsac:CommercialLoansMember bsac:OverNinetyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage3Member bsac:CommercialLoansMember bsac:OverNinetyDaysPastDueMember 2022-12-31 0001027552 bsac:CommercialLoansMember bsac:OverNinetyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage1Member bsac:CommercialLoansMember bsac:OverNinetyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:CommercialLoansMember bsac:OverNinetyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:CommercialLoansMember bsac:OverNinetyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:CommercialLoansMember bsac:OverNinetyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:MortgageLoansMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:MortgageLoansMember bsac:OneToThirtyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage2Member bsac:MortgageLoansMember bsac:OneToThirtyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage3Member bsac:MortgageLoansMember bsac:OneToThirtyDaysPastDueMember 2022-12-31 0001027552 bsac:MortgageLoansMember bsac:OneToThirtyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage1Member bsac:MortgageLoansMember bsac:OneToThirtyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:MortgageLoansMember bsac:OneToThirtyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:MortgageLoansMember bsac:OneToThirtyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:MortgageLoansMember bsac:OneToThirtyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:MortgageLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-12-31 0001027552 bsac:Stage2Member bsac:MortgageLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-12-31 0001027552 bsac:Stage3Member bsac:MortgageLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-12-31 0001027552 bsac:MortgageLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-12-31 0001027552 bsac:Stage1Member bsac:MortgageLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:MortgageLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:MortgageLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-01-01 2022-12-31 0001027552 bsac:MortgageLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member bsac:MortgageLoansMember bsac:OverNinetyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage2Member bsac:MortgageLoansMember bsac:OverNinetyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage3Member bsac:MortgageLoansMember bsac:OverNinetyDaysPastDueMember 2022-12-31 0001027552 bsac:MortgageLoansMember bsac:OverNinetyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage1Member bsac:MortgageLoansMember bsac:OverNinetyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member bsac:MortgageLoansMember bsac:OverNinetyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member bsac:MortgageLoansMember bsac:OverNinetyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:MortgageLoansMember bsac:OverNinetyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember 2022-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember 2022-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember 2022-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:OneToThirtyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:OneToThirtyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:OneToThirtyDaysPastDueMember 2022-12-31 0001027552 ifrs-full:ConsumerLoansMember bsac:OneToThirtyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:OneToThirtyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:OneToThirtyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:OneToThirtyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 ifrs-full:ConsumerLoansMember bsac:OneToThirtyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-12-31 0001027552 ifrs-full:ConsumerLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-01-01 2022-12-31 0001027552 ifrs-full:ConsumerLoansMember bsac:ThirtyOneToNinetyDaysDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:OverNinetyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:OverNinetyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:OverNinetyDaysPastDueMember 2022-12-31 0001027552 ifrs-full:ConsumerLoansMember bsac:OverNinetyDaysPastDueMember 2022-12-31 0001027552 bsac:Stage1Member ifrs-full:ConsumerLoansMember bsac:OverNinetyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage2Member ifrs-full:ConsumerLoansMember bsac:OverNinetyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:Stage3Member ifrs-full:ConsumerLoansMember bsac:OverNinetyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 ifrs-full:ConsumerLoansMember bsac:OverNinetyDaysPastDueMember 2022-01-01 2022-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:InterbankLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:CommercialLoansMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:CommercialLoansMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:MortgageLoanMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:MortgageLoanMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:ConsumerLoanOneMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:ConsumerLoanOneMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:ContingentLoansExposureMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:ContingentLoansExposureMember ifrs-full:CreditRiskMember 2022-12-31 0001027552 ifrs-full:CreditRiskMember 2023-12-31 0001027552 ifrs-full:CreditRiskMember 2022-12-31 0001027552 bsac:FinancialDerivativeContractsMember country:HK ifrs-full:CreditRiskMember 2023-01-01 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember country:HK ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember country:IT ifrs-full:CreditRiskMember 2023-01-01 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember country:IT ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember country:MX ifrs-full:CreditRiskMember 2023-01-01 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember country:MX ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember country:CN ifrs-full:CreditRiskMember 2023-01-01 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember country:CN ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember bsac:BancoSantanderHongKongMember ifrs-full:CreditRiskMember 2023-01-01 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember bsac:BancoSantanderHongKongMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember bsac:BancoSantanderHongKongMember ifrs-full:CurrencyRiskMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember bsac:BancoSantanderMexicoMember ifrs-full:CreditRiskMember 2023-01-01 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember bsac:BancoSantanderMexicoMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember bsac:BancoSantanderMexicoMember ifrs-full:CurrencyRiskMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember bsac:BancoSantanderEEUUMember ifrs-full:CreditRiskMember 2023-01-01 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember bsac:BancoSantanderEEUUMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember bsac:BancoSantanderEEUUMember ifrs-full:CurrencyRiskMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember exch:SNUK ifrs-full:CreditRiskMember 2023-01-01 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember exch:SNUK ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember exch:SNUK ifrs-full:CurrencyRiskMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember bsac:BancoSantanderEspaaMember ifrs-full:CreditRiskMember 2023-01-01 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember bsac:BancoSantanderEspaaMember ifrs-full:CreditRiskMember 2023-12-31 0001027552 bsac:FinancialDerivativeContractsMember bsac:BancoSantanderEspaaMember ifrs-full:CurrencyRiskMember 2023-12-31 0001027552 bsac:PropertiesAndMortgagesMember ifrs-full:FinancialInstrumentsNotCreditimpairedMember ifrs-full:CreditRiskMember 2023-01-01 2023-12-31 0001027552 bsac:PropertiesAndMortgagesMember ifrs-full:FinancialInstrumentsNotCreditimpairedMember ifrs-full:CreditRiskMember 2022-01-01 2022-12-31 0001027552 bsac:InvestmentsAndOthersMember ifrs-full:FinancialInstrumentsNotCreditimpairedMember ifrs-full:CreditRiskMember 2023-01-01 2023-12-31 0001027552 bsac:InvestmentsAndOthersMember ifrs-full:FinancialInstrumentsNotCreditimpairedMember ifrs-full:CreditRiskMember 2022-01-01 2022-12-31 0001027552 bsac:PropertiesAndMortgagesMember ifrs-full:FinancialInstrumentsCreditimpairedMember ifrs-full:CreditRiskMember 2023-01-01 2023-12-31 0001027552 bsac:PropertiesAndMortgagesMember ifrs-full:FinancialInstrumentsCreditimpairedMember ifrs-full:CreditRiskMember 2022-01-01 2022-12-31 0001027552 bsac:InvestmentsAndOthersMember ifrs-full:FinancialInstrumentsCreditimpairedMember ifrs-full:CreditRiskMember 2023-01-01 2023-12-31 0001027552 bsac:InvestmentsAndOthersMember ifrs-full:FinancialInstrumentsCreditimpairedMember ifrs-full:CreditRiskMember 2022-01-01 2022-12-31 0001027552 ifrs-full:CreditRiskMember 2023-01-01 2023-12-31 0001027552 ifrs-full:CreditRiskMember 2022-01-01 2022-12-31 0001027552 bsac:IndividualUpToSevenDaysMember 2023-01-01 2023-12-31 0001027552 bsac:IndividualUpToFifteenDaysMember 2023-01-01 2023-12-31 0001027552 bsac:IndividualUpToThirtyDaysMember 2023-01-01 2023-12-31 0001027552 bsac:ConsolidatedUpToSevenDaysMember 2023-01-01 2023-12-31 0001027552 bsac:ConsolidatedUpToFifteenDaysMember 2023-01-01 2023-12-31 0001027552 bsac:ConsolidatedUpToThirtyDaysMember 2023-01-01 2023-12-31 0001027552 bsac:IndividualUpToSevenDaysMember 2022-01-01 2022-12-31 0001027552 bsac:IndividualUpToFifteenDaysMember 2022-01-01 2022-12-31 0001027552 bsac:IndividualUpToThirtyDaysMember 2022-01-01 2022-12-31 0001027552 bsac:ConsolidatedUpToSevenDaysMember 2022-01-01 2022-12-31 0001027552 bsac:ConsolidatedUpToFifteenDaysMember 2022-01-01 2022-12-31 0001027552 bsac:ConsolidatedUpToThirtyDaysMember 2022-01-01 2022-12-31 0001027552 bsac:ExpensesMember bsac:InternalFraudMember 2023-01-01 2023-12-31 0001027552 bsac:ExpensesMember bsac:InternalFraudMember 2022-01-01 2022-12-31 0001027552 bsac:ExpensesMember bsac:ExternalFraudMember 2023-01-01 2023-12-31 0001027552 bsac:ExpensesMember bsac:ExternalFraudMember 2022-01-01 2022-12-31 0001027552 bsac:ExpensesMember bsac:LaborRelatedMember 2023-01-01 2023-12-31 0001027552 bsac:ExpensesMember bsac:LaborRelatedMember 2022-01-01 2022-12-31 0001027552 bsac:ExpensesMember bsac:ClientProductRelatedMember 2023-01-01 2023-12-31 0001027552 bsac:ExpensesMember bsac:ClientProductRelatedMember 2022-01-01 2022-12-31 0001027552 bsac:ExpensesMember bsac:DamageToFixedAssetsMember 2023-01-01 2023-12-31 0001027552 bsac:ExpensesMember bsac:DamageToFixedAssetsMember 2022-01-01 2022-12-31 0001027552 bsac:ExpensesMember bsac:BusinessContinuitySystemsMember 2023-01-01 2023-12-31 0001027552 bsac:ExpensesMember bsac:BusinessContinuitySystemsMember 2022-01-01 2022-12-31 0001027552 bsac:ExpensesMember bsac:ProcessingMember 2023-01-01 2023-12-31 0001027552 bsac:ExpensesMember bsac:ProcessingMember 2022-01-01 2022-12-31 0001027552 bsac:RecoveriesOfExpensesMember bsac:InternalFraudMember 2023-01-01 2023-12-31 0001027552 bsac:RecoveriesOfExpensesMember bsac:InternalFraudMember 2022-01-01 2022-12-31 0001027552 bsac:RecoveriesOfExpensesMember bsac:ExternalFraudMember 2023-01-01 2023-12-31 0001027552 bsac:RecoveriesOfExpensesMember bsac:ExternalFraudMember 2022-01-01 2022-12-31 0001027552 bsac:RecoveriesOfExpensesMember bsac:LaborRelatedMember 2023-01-01 2023-12-31 0001027552 bsac:RecoveriesOfExpensesMember bsac:LaborRelatedMember 2022-01-01 2022-12-31 0001027552 bsac:RecoveriesOfExpensesMember bsac:ClientProductRelatedMember 2023-01-01 2023-12-31 0001027552 bsac:RecoveriesOfExpensesMember bsac:ClientProductRelatedMember 2022-01-01 2022-12-31 0001027552 bsac:RecoveriesOfExpensesMember bsac:DamageToFixedAssetsMember 2023-01-01 2023-12-31 0001027552 bsac:RecoveriesOfExpensesMember bsac:DamageToFixedAssetsMember 2022-01-01 2022-12-31 0001027552 bsac:RecoveriesOfExpensesMember bsac:BusinessContinuitySystemsMember 2023-01-01 2023-12-31 0001027552 bsac:RecoveriesOfExpensesMember bsac:BusinessContinuitySystemsMember 2022-01-01 2022-12-31 0001027552 bsac:RecoveriesOfExpensesMember bsac:ProcessingMember 2023-01-01 2023-12-31 0001027552 bsac:RecoveriesOfExpensesMember bsac:ProcessingMember 2022-01-01 2022-12-31 0001027552 bsac:SwissFrancBondMember 2024-01-11 0001027552 bsac:SwissFrancBondMember 2024-01-11 2024-01-11 0001027552 bsac:InternationalFinanceCorporationMember 2024-02-05 0001027552 bsac:NonadjustingEventsAfterReportingPeriodMember 2024-02-12 2024-02-12 0001027552 bsac:AA13Member 2023-01-01 2023-12-31 0001027552 bsac:AA9Member 2023-01-01 2023-12-31 0001027552 bsac:AA7Member 2023-01-01 2023-12-31 0001027552 bsac:AA8Member 2023-01-01 2023-12-31 0001027552 bsac:WthreeMember 2023-01-01 2023-12-31 0001027552 bsac:AATwoMember 2023-01-01 2023-12-31 0001027552 bsac:AAFourteenMember 2023-01-01 2023-12-31 xbrli:shares iso4217:CLP iso4217:CLP xbrli:shares xbrli:pure iso4217:USD iso4217:JPY iso4217:CLF iso4217:USD xbrli:shares iso4217:CHF

Exhibit 2D

 

DESCRIPTION OF CAPITAL STOCK

 

The following description of our capital stock is a summary and does not purport to be complete. It is subject to and qualified in its entirety by reference to our by-laws, which are incorporated by reference as an exhibit to the Annual Report on Form 20-F of which this Exhibit is a part. We encourage you to read the by-laws for additional information.

 

Issued Share Capital

 

The Bank has a single series of capital stock, which amounts to Ch$891,302,881,691, divided into 188,446,126,794 registered shares with no par value. The capital stock is fully subscribed for, deposited, and paid up. Each share represents one vote and there are no special classes of shares with different rights. Our by-laws do not include any condition that is more significant than required by law to change the right of shareholders.

 

Shareholder rights in a Chilean bank that is also an open stock (public) corporation are governed by (1) the corporation’s estatutos, which effectively serve the purpose of both the articles or certificate of incorporation and the by-laws of a company incorporated in the United States, (2) the General Banking Law and (3) to the extent not inconsistent with the General Banking Law, by the provisions of Chilean Companies Law applicable to open stock corporations, except for certain provisions that are expressly excluded. Article 137 of the Chilean Companies Law provides that all provisions of the Chilean Companies Law take precedence over any contrary provision in a corporation’s estatutos. Both the Chilean Companies Law and our estatutos provide that legal actions by shareholders against us (or our officers or directors) to enforce their rights as shareholders or by one shareholder against another in their capacity as such are to be brought in Chile in arbitration proceedings.

 

Meetings and Voting Rights

 

The shareholders shall meet in Ordinary or Extraordinary Shareholders’ Meetings held in Santiago. The resolutions adopted at a validly summoned and convened Shareholders’ Meeting, in conformity with the by-laws, shall be binding on all of the shareholders.

 

The Ordinary Shareholders’ Meetings shall be held annually on the dates determined by the Board within the first four months following the date of the annual balance sheet. There shall be an Extraordinary Shareholders’ Meeting whenever the company’s needs so require. The meetings shall be summoned by the Board at its own initiative or at the request of shareholders representing at least 10% of the issued shares having a legal right to vote. If in this circumstance, the Board, and through it the Chairman, refuses to issue a summons, the Financial Markets Commission (“FMC”) may be requested to do so.

 

The summons to a Shareholders’ Meeting shall be given through a prominent notice to be published three times on different days in the Santiago newspaper which has been chosen at the Ordinary Shareholders’ Meeting, and in the absence of agreement or in the event of a suspension or disappearance of the designated newspaper’s circulation, in the Official Journal, at the time, in the form, and under the conditions stipulated by the Regulations of the Chilean Companies Law. Summonses to Extraordinary Shareholders’ Meetings shall state the topics which will be submitted to them. The summons to a meeting shall likewise be announced through a letter sent to the shareholders a minimum of fifteen days in advance of the date set for the meeting, which must contain a reference to the topics to be addressed at it. Failure to send said letter shall not invalidate the summons, without prejudice to legal liabilities. On a date no later than that of the first notice of a summons for an Ordinary Shareholders’ Meeting, each shareholder must be sent a copy of the Bank’s Annual Report and Balance Sheet, including the auditors’ opinion and its respective notes.

 

 

 

 

Quorum for Shareholders’ Meetings shall be established by the presence of as many shareholders as represent, directly or by proxy, at least an absolute majority of the issued voting shares. If said quorum is not satisfied, a new summons shall be given, for a meeting which must be scheduled to be held in the manner prescribed in Article 37 of our by-laws, indicating that it is a second summons and scheduling the new meeting to be held within the forty five days subsequent to the date scheduled for the meeting that was not held due to a lack of quorum. A meeting called by a second summons shall lawfully convene with the number of issued voting shares present or represented thereat.

 

In the absence of a special rule, a Shareholders’ Meeting resolution shall be adopted by an absolute majority of the voting shares present or represented.

 

The Ordinary Shareholders’ Meetings have the following responsibilities: (a) deliberate and resolve on the Annual Report and Balance Sheet which must be submitted by the Board; (b) annually designate an external auditing firm in conformity with the provisions of law to report on the balance sheet and comply with the legal requirements; (c) elect the members of the Board when appropriate pursuant to our by-laws; (d) resolve the distribution of the liquid profits or earnings for each fiscal year, and at the Board’s request, order the distribution of a dividend to the shareholders as of the end of each fiscal year, as prescribed in the by-laws; and (e) in general, deliberate and pass resolutions on any other topic of corporate interest which is not reserved to an Extraordinary Shareholders’ Meeting. The revocation of all the Board members elected by the shareholders and the designation of their replacements may be resolved at an Ordinary or Extraordinary Shareholders’ Meeting, but any individual or collective revocation of one or more Board members would accordingly be invalid.

 

The Extraordinary Shareholders’ Meetings are reserved for certain topics indicated by law or by our by-laws. Resolutions on the topics indicated in the notice of meeting may be adopted at Extraordinary Shareholders’ Meetings.

 

The shareholders may have themselves represented at Meetings by another person, whether a shareholder or not, as is stipulated in the Chilean Companies Law.

 

A record of the deliberations and resolutions at any Shareholders’ Meeting shall be made in a special minute book to be kept by the Secretary, if any, or in his or her absence by the Bank’s General Manager. The minutes shall be signed by the Chairman or the person who performs his or her functions, by the Secretary and three shareholders elected by the Meeting, or by all the persons present if they number fewer than three. In the event of death, refusal, or impediment to signing the minutes on the part of any of the persons who must do so, a record of the impediment shall be made at the foot thereof. An extract of the minutes shall be made to record what happened at the meeting, and an official copy of the following data shall necessarily be made: the names of the shareholders present and the number of shares owned or represented by each of them (a brief summary of any objections may be omitted if it is attached to the same page or roll of attendance), a list of the proposals submitted for discussion and the results of the votes taken, and the list of the shareholders who voted for or against. Solely by the unanimous consent of the persons present may a record of any event occurring at the meeting that is related to the company’s interests be deleted from the minutes.

 

2

 

 

The persons present at any Shareholders’ Meetings shall sign a roll of attendance on which they shall indicate the number of shares the signatory holds, the number of shares he represents, and the name of the shareholder he represents.

 

In general, Chilean law does not require a Chilean open stock corporation to provide the level and type of information that U.S. securities laws require a reporting company to provide to its shareholders in connection with a solicitation of proxies. However, shareholders are entitled to examine the books of the bank within the 15-day period before the ordinary annual meeting. In addition to these requirements, we regularly provide, and management currently intends to continue to provide, together with the notice of shareholders’ meeting, a proposal for the final annual dividend.

 

Election of Directors

 

The Board of Directors consists of nine directors and two alternates, elected by shareholder vote at Ordinary Shareholders’ Meetings. The directors may be either shareholders or non-shareholders of the Company. There is no age limit for directors.

 

The directors shall hold office for three years and may be indefinitely re-elected, and their terms of office shall be renewed in their entirety at the conclusion of each term of office. If the Ordinary Shareholders’ Meeting at which periodic elections of directors occur is not held at the stipulated time for any reason, the incumbency of those who have completed their terms shall be understood to be extended until their replacements are appointed, and the Board shall be obligated to summon a Shareholders’ Meeting to make said appointments within thirty days.

 

In the elections of directors, each shareholder shall have one vote per share held or represented, and may cast all such votes in favor a single candidate or distribute them as deemed convenient; those who receive the largest number of votes in an election shall be proclaimed as elected, until the number of persons to be elected is reached. Elections of principal and alternate directors must be held separately. To proceed to a vote, the Chairman and the Secretary, jointly with the persons who have previously been designated at the Ordinary Shareholders’ Meeting to sign the minutes thereof, must make a documentary record of the votes which are cast through voice vote by the shareholders present, according to the list of attendance. However, any shareholder shall be entitled to vote on a ballot signed by him, stating whether he signs on his own behalf or as a proxy. In any event, to facilitate the casting or speed of a vote, the Chairman of the Bank or the FMC, if applicable, may order an alternative procedure or permit either a voice vote or a ballot vote, or any other procedure stipulated as adequate for the purpose. In counting the results, the Chairman shall read out the votes cast aloud so that all the persons present can count the votes themselves and the truthfulness of the result can be verified. The Secretary shall add up the votes and the Chairman shall announce the candidates that receive the largest majorities and proclaim them thereby elected, until the number of persons to be elected is reached. The Secretary shall place the document reflecting the vote count, signed by the persons responsible for taking note of the votes cast, as well as the ballots delivered by the shareholders who did not vote by voice, in an envelope which shall be closed and sealed with the corporate seal, and shall be kept on file at the Bank for at least two years.

 

3

 

 

Every election to the Board, or every change to the composition of the Board, must be recorded in a public deed executed before a Notary, published in a Santiago newspaper, and reported to the FMC by sending an authorized copy of the respective public deed. The appointments of the General Manager and Assistant Deputy Manager must likewise be reported and converted into a public deed.

 

Vacancies that arise when a director ceases to be able to perform his or her duties, either because he becomes subject to any conflict of interest, limitation, or legal disqualification or because he is subject to a pending insolvency procedure for liquidation, or due to impossibility of serving, unjustified absence, death, resignation, or for another legal cause, shall be filled in the following manner: (a) vacancies of principal directors by alternate directors; and (b) in case of vacancies of alternate directors because of the application or circumstances not provided for in letter (a) above, or vacancies of principal directors which could not be filled as provided for in this letter because the alternate directors have become principal directors, the appropriate replacements shall be appointed at the first board of directors meeting to be held. The directors so designated shall remain in office until the next Ordinary Shareholders’ Meeting, at which the definitive appointments shall be made for the time remaining to complete the replaced directors’ terms.

 

Amendments

 

Our bylaws may only be amended at an Extraordinary Shareholders meeting held before a notary public.

 

Annual Report, Balance Sheet, and Distribution of Profits

 

A Balance Sheet shall be drawn up as of the thirty-first day of December of each year, to be submitted to the Ordinary Shareholders’ Meeting for its consideration, jointly with the Annual Report. The Balance Sheet and Statement of Income shall be published in conformity with the currently applicable legal and regulatory provisions. The approval or rejection of such financial statements is entirely within our shareholders’ discretion. If our shareholders reject our financial statements, our Board of Directors must submit new financial statements no later than 60 days from the date of such rejection. If our shareholders reject our new financial statements, our entire Board of Directors is deemed removed from office and a new Board of Directors is elected at the same meeting. Directors who individually approved such rejected financial statements are disqualified for re-election for the ensuing period.

 

4

 

 

The profits attributable to shareholders reflected in the Balance Sheet shall be applied preferentially to absorb prior-year losses. The balance which is earned shall be allocated as may be resolved by the Shareholders’ Meeting, at the Board’s recommendation, to: (a) an increase of the effective capital, the formation of a fund for future capitalizations or dividends, or other special reserve funds; these uses shall receive the amounts the Meeting deems convenient, in conformity with the limits and obligations prescribed by law; and (b) the distribution of dividends to the shareholders in proportion to their shareholdings.

 

Under the Chilean Corporations Law, Chilean companies are generally required to distribute at least 30.0% of their earnings as dividends. No dividends of a bank above the legal minimum can be distributed if doing so would result in the bank exceeding its ratio of regulatory capital to risk-weighted assets and shareholders’ equity to total assets

 

Dividends that are declared but not paid by the date set for payment at the time of declaration are adjusted from the date set for payment to the date such dividends are actually paid, and they accrue interest. A dividend entitlement lapses after 5 years and the funds go to the Chilean Treasury.

 

We may declare a dividend in cash or in shares. When a share dividend is declared above the legal minimum (which minimum must be paid in cash), our shareholders must be given the option to elect to receive cash. For more information, please see “—Preemptive Rights and Increases of Share Capital.”

 

Liquidation and Appraisal Rights

 

The Bank may be dissolved and liquidated if it is so resolved at an Extraordinary Shareholders’ Meeting, with the favorable vote of at least two thirds of the issued voting shares, and approved by the FMC.

 

Once the voluntary dissolution to which the preceding article refers has been resolved, the Shareholders’ Meeting at which it is resolved shall appoint a committee of three shareholders to proceed to the company’s liquidation. The liquidating committee so created shall act with the powers and obligations, which the by-laws confer on the Board, and it shall keep the shareholders informed of the liquidation’s progress, shall summon Ordinary Shareholders’ Meetings on the dates scheduled for them, being authorized to likewise summon Extraordinary Shareholders’ Meetings. In all other respects the provisions of the Commercial Code, the applicable provisions of the Chilean Companies Law, and the corporate regulations which govern the company shall be followed. In accordance with the General Banking Law, our shareholders do not have appraisal rights.

 

Arbitration

 

Any difficulty which may arise between the Bank and any of the shareholders or directors, or between such persons, in connection with the application of the by-laws or the recognition of the existence, nonexistence, validity, nullity, construction, performance or breach, dissolution, liquidation, or any other cause shall be submitted to resolution by two arbitrators at law and in equity, who shall rule without subsequent appeal, one of whom shall be appointed by each party. If they cannot reach agreement, the parties shall appoint a third arbitrator to resolve the discord. If there is no agreement for the third arbitrator’s appointment, the two previously appointed arbitrators shall make the designation. If either party refuses to participate in the appointment of arbitrators or, after they have been appointed, there is no agreement on the ruling and neither the parties nor the arbitrators have designated the third arbitrator to resolve the discord, the designation of said arbitrator, if any, or of the third participant in discord, shall be made by the Ordinary Court of Justice, and the person so designated must necessarily be one who has held or currently holds the position of attorney and member of the Honorable Supreme Court.

 

5

 

 

Capitalization

 

Under Chilean law, the shareholders of a company, acting at an extraordinary shareholders’ meeting, have the power to authorize an increase in such company’s capital. When an investor subscribes for issued shares, the shares are registered in such investor’s name, even if not paid for, and the investor is treated as a shareholder for all purposes except with regard to receipt of dividends and the return of capital, provided that the shareholders may, by amending the by-laws, also grant the right to receive dividends or distributions of capital. The investor becomes eligible to receive dividends and returns of capital once it has paid for the shares (if it has paid for only a portion of such shares, it is entitled to reserve a corresponding pro-rata portion of the dividends declared and/or returns of capital with respect to such shares unless the company’s by-laws provide otherwise). If an investor does not pay for shares for which it has subscribed on or prior to the date agreed upon for payment, the company is entitled under Chilean law to auction the shares on the stock exchange and collect the difference, if any, between the subscription price and the auction proceeds. However, until such shares are sold at auction, the subscriber continues to exercise all the rights of a shareholder (except the right to receive dividends and return of capital).

 

Article 22 of the Chilean Corporations Law states that the purchaser of shares of a company implicitly accepts its by-laws and any agreements adopted at shareholders’ meetings.

 

Ownership Restrictions

 

Under Article 12 of the Chilean Securities Market Law and the regulations of the FMC, shareholders of open stock corporations are required to report the following to the FMC and the Chilean stock exchanges:

 

any direct or indirect acquisition or sale of shares that results in the holder’s acquiring or disposing, directly or indirectly, 10.0% or more of an open stock corporation’s share capital; and

 

any direct or indirect acquisition or sale of shares or options to buy or sell shares, in any amount, if made by a holder of 10.0% or more of an open stock corporation’s capital or if made by a director, liquidator, main officer, general manager or manager of such corporation.

 

In addition, majority shareholders must include in their report whether their purpose is to acquire control of the company or if they are making a financial investment.

 

6

 

 

Under Article 54 of the Chilean Securities Market Law and the regulations of the FMC, persons or entities intending to acquire control, directly or indirectly, of an open stock corporation, regardless of the acquisition vehicle or procedure, and including acquisitions made through direct subscriptions or private transactions, are also required to inform the public of such acquisition at least 10 business days before the date on which the transaction is to be completed, but in any case, as soon as negotiations regarding the change of control begin (i.e., when information and documents concerning the target are delivered to the potential acquirer) through a filing with the FMC, the stock exchanges and the companies controlled by and that control the target and through a notice published in two Chilean newspapers, which notice must disclose, among other information, the person or entity purchasing or selling and the price and conditions of any negotiations.

 

Prior to such publication, a written communication to such effect must be sent to the target corporation, to the controlling corporation, to the corporations controlled by the target corporation, to the FMC, and to the Chilean stock exchanges on which the securities are listed.

 

In addition to the foregoing, Article 54A of the Chilean Securities Market Law requires that within two business days of the completion of the transactions pursuant to which a person has acquired control of a publicly traded company, a notice shall be published in the same newspapers in which the notice referred to above was published and notices shall be sent to the same persons mentioned in the preceding paragraphs.

 

The provisions of the aforementioned articles do not apply whenever the acquisition is being made through a tender or exchange offer.

 

Title XXV of the Chilean Securities Market Law on tender offers and the regulations of the the FMC provide that the following transactions must be carried out through a tender offer:

 

an offer which allows a person to take control of a publicly traded company, unless (i) the shares are being sold by a controlling shareholder of such company at a price in cash which is not substantially higher than the market price and the shares of such company are actively traded on a stock exchange and (ii) those shares are acquired (a) through a capital increase, (b) as a consequence of a merger, (c) by inheritance or (d) through a forced sale; and

 

an offer for a controlling percentage of the shares of a listed company if such person intends to take control of the parent company (whether listed or not) of such listed company, to the extent that the listed company represents 75.0% or more of the consolidated net worth of the parent company.

 

In addition, Article 199 of the Chilean Securities Market Law requires that whenever a controlling shareholder acquires two thirds of the voting shares of a listed company, such controlling shareholder must offer to purchase the remaining shares from the non-controlling shareholders in a tender offer.

 

Article 200 of the Chilean Securities Market Law prohibits any shareholder that has taken control of a publicly traded company to acquire, for a period of 12 months from the date of the transaction in which it gained control of the publicly traded company, a number of shares equal to or greater than 3.0% of the outstanding issued shares of the target without making a tender offer at a price per share not lower than the price paid at the time of taking control. Should the acquisition from the other shareholders of the company be made on a stock exchange and on a pro rata basis, the controlling shareholder may purchase a higher percentage of shares, if so permitted by the regulations of the stock exchange.

 

7

 

 

Title XV of the Chilean Securities Market Law sets forth the basis to determine what constitutes a controlling power, a direct holding and a related party. The Chilean Securities Market Law defines control as the power of a person or group of persons acting (either directly or through other entities or persons) pursuant to a joint action agreement, to direct the majority of the votes at the shareholders’ meetings of the corporation, to elect the majority of members of its Board of Directors, or to influence the management of the corporation significantly. Significant influence is deemed to exist in respect of the person or group of persons with an agreement to act jointly that holds, directly or indirectly, at least 25.0% of the voting share capital, unless:

 

another person or group of persons acting pursuant to joint action agreement, directly or indirectly, controls a stake equal to or greater than the percentage controlled by such person or group of persons;

 

the person or group does not control, directly or indirectly, more than 40.0% of the voting share capital and the percentage controlled is lower than the sum of the shares held by other shareholders holding more than 5.0% of the share capital (either directly or pursuant to a joint action agreement); or

 

in cases where the FMC has ruled otherwise, based on the distribution or atomization of the overall shareholding.

 

According to the Chilean Securities Market Law, a joint action agreement is an agreement among two or more parties which, directly or indirectly, own shares in a corporation at the same time and whereby they agree to participate with the same interest in the management of the corporation or in taking control of the same. The law presumes that such an agreement exists between:

 

a principal and its agents;

 

spouses and relatives within certain degrees of kinship;

 

entities within the same business group; and

 

an entity and its controller or any of the members of the controller.

 

Likewise, the FMC may determine that a joint action agreement exists between two or more entities considering, among other things, the number of companies in which they participate and the frequency with which they vote identically in the election of directors, appointment of managers and other resolutions passed at extraordinary shareholders’ meetings.

 

8

 

 

According to Article 96 of the Chilean Securities Market Law, a business group is a group of entities with such ties in their ownership, management or credit liabilities that it may be assumed that the economic and financial action of such members is directed by, or subordinated to, the joint interests of the group, or that there are common credit risks in the credits granted to, or in the acquisition of securities issued by, them. According to the Chilean Securities Market Law, the following entities are part of the same business group:

 

a company and its controller;

 

all the companies with a common controller together with that controller;

 

all the entities that the FMC declares to be part of the business group due to one or more of the following reasons:

 

a substantial part of the assets of the company is involved in the business group, whether as investments in securities, equity rights, loans or guaranties;

 

the company has a significant level of indebtedness and the business group has a material participation as a lender or guarantor;

 

any member of a group of controlling entities of a company mentioned in the first two bullets above and there are grounds to include it in the business group; or

 

the company is controlled by a member of a group of controlling entities and there are grounds to include it in the business group.

 

Article 36 of the General Banking Law states that as a matter of public policy, no person or company may acquire, directly or indirectly, more than 10.0% of the shares of a bank without the prior authorization of the FMC, which may not be unreasonably withheld. In the absence of such authorization, any person or group of persons acting in concert would not be permitted to exercise voting rights with respect to the shares acquired. In determining whether or not to issue such an authorization, the FMC considers a number of factors enumerated in Article 28 of the General Banking Law, including, among others (i) the financial stability of the purchasing party and (ii) the legitimacy of the purchasing party.

 

According to Article 35bis of the General Banking Law, the prior authorization of the FMC is required for:

 

the merger of two or more banks;

 

the acquisition of all or a substantial portion of a banks’ assets and liabilities by another bank;

 

the control by the same person, or controlling group, of two or more banks; or

 

a substantial increase in the existing control of a bank by a controlling shareholder of that bank.

 

9

 

 

The FMC may deny its authorization with an accompanying resolution recording the specific reasons for denying the authorization and with the agreement of a majority of the Board of Directors of the Central Bank, provided there is notice of such agreement within 10 banking business days (which may be extended under Law 18,840).

 

Finally, according to the regulations of the FMC, Chilean banks that issue ADSs are required to inform the FMC if any person, directly or indirectly, acquires ADSs representing 5.0% or more of the total amount of shares of capital stock issued by such bank.

 

Article 16bis of the General Banking Law provides that the individuals or legal entities that, individually or with other people, directly control a bank and who individually own more than 10.0% of its shares must send to the FMC reliable information on their financial situation with the content and in the opportunity set forth in a general rule issued by the FMC, which will not exceed the information required for open-stock corporations (sociedad anónima abierta).

 

There are no limitations for non-resident or foreign shareholders to hold or exercise voting rights on the securities.

 

Preemptive Rights and Increases of Share Capital

 

The Chilean Corporations Law provides that whenever a Chilean company issues new shares for cash, it must offer its existing shareholders the right to purchase a number of shares sufficient to maintain their existing ownership percentages in the company. According to our by-laws, options for subscription of capital increases must be offered on a preemptive basis to the shareholders, in proportion to the number of shares each shareholder owns, and the released shares which are issued shall be distributed in the same proportion. Pursuant to this requirement, preemptive rights in connection with any future issue of shares will be offered by us to the shareholders.

 

Under Chilean law, preemptive rights are exercisable or freely transferable by shareholders during a period that cannot be less than 30 days following the grant of such rights. During such period, and for an additional 30-day period thereafter, a Chilean corporation is not permitted to offer any unsubscribed shares for sale to third parties on terms which are more favorable than those offered to its shareholders. At the end of such additional 30-day period, a Chilean open stock corporation is authorized to sell unsubscribed shares to third parties on any terms, provided they are sold on a Chilean stock exchange. Unsubscribed shares that are not sold on a Chilean stock exchange can be sold to third parties only on terms no more favorable for the purchaser than those offered to shareholders.

  

10

 

 

DESCRIPTION OF AMERICAN DEPOSITARY SHARES

 

The following description of our American depositary shares (the “ADSs”) is a summary and does not purport to be complete. It is subject to and qualified in its entirety by reference to the Amended and Restated Deposit Agreement (the “Deposit Agreement”) among Banco Santander Chile (the “Bank”), The Bank of New York Mellon (the “Depositary”) the holders from time to time of American depositary receipts (the “ADRs”) issued thereunder evidencing ADSs, which is incorporated by reference as an exhibit to the Form 20-F of which this Exhibit is a part. We encourage you to read the Deposit Agreement for additional information.

 

American Depositary Shares

 

The Depositary executes and delivers ADRs. Each ADR is a certificate evidencing a specific number of ADSs. Each ADS represents 400 shares of the Bank’s capital stock. Each ADS also represents any other securities, cash or other property that may be held by the Depositary. The Depositary’s office is located at 240 Greenwich Street, New York, N.Y. 10286. Our ADSs are currently traded on the NYSE under the symbol “BSAC.”

 

ADS holders are not treated as shareholders and do not have shareholder rights. Chilean law governs shareholder rights. The Depositary is the holder of the shares underlying the ADSs. ADS holders have ADS holder rights. The Deposit Agreement sets out ADS holder rights as well as the rights and obligations of the Depositary. New York law governs the Deposit Agreement and the ADSs.

 

Deposit of Shares

 

Subject to the terms and conditions of the Deposit Agreement, shares or evidence of rights to receive shares may be deposited under the Deposit Agreement by delivery thereof to any custodian, accompanied by any appropriate instruments or instructions for transfer, or endorsement, in form satisfactory to the custodian. As conditions of accepting shares for deposit, the Depositary may require also evidence satisfactory to the Depositary that the deposit has been authorized by the Central Bank of Chile (unless and until the Company provides the Depositary with evidence satisfactory to it that such authorization is no longer necessary), and that the conditions for such authorization, as set forth in to the foreign exchange contract entered by and between the Depositary, the Bank and the Central Bank of Chile (the “Foreign Exchange Contract”), have been satisfied.

 

Upon receiving a notice of a deposit from a custodian, or upon the receipt of shares or evidence of the right to receive shares by the Depositary, the Depositary, subject to the terms and conditions of the Deposit Agreement, shall deliver, to or upon the order of the person or persons entitled thereto, the number of ADSs issuable in respect of that deposit, but only upon payment to the Depositary of the fees and expenses of the Depositary for the delivery of those ADSs and of all taxes and governmental charges and fees payable in connection with that deposit and the transfer of the deposited shares. The Depositary shall deliver only whole numbers of ADSs.

 

11

 

 

Surrender of ADSs and Withdrawal of Deposited Securities

 

Upon surrender of ADSs for the purpose of withdrawal of the deposited securities and payment of the fee of the Depositary for the surrender of ADSs and payment of all taxes and governmental charges payable in connection with that surrender and withdrawal of the deposited securities, and subject to the terms and conditions of this Deposit Agreement, the ADS holder of those ADSs shall be entitled to delivery of the amount of deposited securities at the time represented by those ADSs, but not any money or other property as to which a record date for distribution to ADS holders has passed. That delivery shall be made without unreasonable delay. Simultaneously with the delivery of deposited securities to the ADS holder or its designee, the custodian, pursuant to the Foreign Exchange Contract, will issue or cause to be issued to the ADS holder or such designee a certificate which states that the deposited securities have been transferred to the ADS holder or its designee by the Depositary and that the Depositary waives in favor of the ADS holder or its designee the right of access to the formal foreign exchange market relating to such withdrawn deposited securities.

 

Dividends and Other Distributions on the Shares

 

The Depositary has agreed to pay or distribute to ADS holders the cash dividends or other distributions it or the custodian receives on shares or other deposited securities, upon payment or deduction of its fees and expenses. ADS holders will receive these distributions in proportion to the number of shares their ADSs represent.

 

Cash

 

Whenever the Depositary receives any cash dividend or other cash distribution on deposited securities, the Depositary will, if at the time of receipt thereof any amounts received in a foreign currency can in the judgment of the Depositary be converted on a reasonable basis into dollars transferable to the United States, and subject to the Deposit Agreement, convert that dividend or other cash distribution into U.S. dollars and distribute the amount thus received (net of the fees and expenses of the Depositary). The Depositary will not pay any ADS holder a fraction of one cent, but will round each ADS holder’s entitlement to the nearest whole cent.

 

If the custodian or the Depositary is required to withhold and does withhold from that cash dividend or other cash distribution an amount on account of taxes or other governmental charges, the amount distributed to the ADS holders shall be reduced accordingly. Each ADS holder agrees to indemnify the Bank, the Depositary, the custodian and their respective directors, officers, employees, agents and affiliates for, and hold each of them harmless against, any claim by any governmental authority with respect to taxes, additions to tax, penalties or interest arising out of any refund of taxes, reduced withholding at source or other tax benefit received by it.

 

12

 

 

Shares

 

Whenever the Depositary receives any distribution on deposited securities consisting of a dividend in, or free distribution of, shares, the Depositary may deliver to the ADS holders entitled thereto, in proportion to the number of ADSs representing those deposited securities held by them respectively, an aggregate number of ADSs representing the amount of shares received as that dividend or free distribution, subject to the terms and conditions of the Deposit Agreement with respect to the deposit of shares and issuance of ADSs.

 

In lieu of delivering fractional ADSs, the Depositary may sell the amount of shares represented by the aggregate of those fractions (or ADSs representing those shares) and distribute the net proceeds, all in the manner and subject to the conditions described in the Deposit Agreement.

 

If the Bank declares a distribution in which holders of deposited securities have a right to elect whether to receive cash, shares or other securities or a combination of those things, or a right to elect to have a distribution sold on their behalf, the Depositary shall consult with the Bank to the extent practicable as to the action to be taken, if any, and may make that right of election available for exercise by ADS holders in any manner the Depositary reasonably considers to be lawful and practical.

 

Rights to purchase additional shares

 

If rights are granted to the Depositary in respect of deposited shares to purchase additional shares or other securities, the Bank and the Depositary shall endeavor to consult as to the actions, if any, the Depositary should take in connection with that grant of rights. The Depositary shall, to the extent reasonably deemed by it to be lawful and practical: (i) if requested by writing by the Bank, grant to all or certain ADS holders rights to instruct the Depositary to purchase the securities to which the rights relate and deliver those securities or ADSs representing those securities, (ii) if requested by writing by the Bank, deliver the rights to or to the order of certain ADS holders, or (iii) sell the rights to the extent practicable and distribute the net proceeds of that sale to the ADS holders entitled to those proceeds. To the extent rights are not exercised, delivered or disposed of under (i), (ii) or (iii) above, the Depositary shall permit the rights to lapse unexercised. If the Depositary acts under items (i) or (ii) above, the Bank and the Depositary will enter into a separate agreement setting forth the conditions and procedures of the offering. If the Depositary will act under item (iii), the Depositary will use reasonable efforts to sell the rights and pay the net proceeds to the ADS holders.

 

Payment or deduction of the fees of the Depositary shall be a condition of any delivery of securities or cash proceeds. The Depositary shall not be responsible for any failure to determine that it may be lawful or feasible to make rights available to or exercise rights on behalf of ADS holders or to sell rights.

 

Other Distributions

 

Whenever the Depositary receives any distribution other than the ones listed above, the Depositary shall, as promptly as practicable, cause the securities or property received by it to be distributed to the ADS holders entitled thereto, after deduction or upon payment of any fees and expenses of the Depositary and any taxes or other governmental charges, in proportion to the number of ADSs representing the deposited securities held by them respectively, in any manner that the Depositary deems equitable and practicable for accomplishing that distribution.

 

13

 

 

However, if in the opinion of the Depositary such distribution cannot be made proportionately among the ADS holders entitled thereto, or if for any other reason the Depositary deems such distribution not to be lawful and feasible, the Depositary may adopt such other method as it may deem equitable and practicable for the purpose of effecting such distribution, including, but not limited to, the public or private sale of the securities or property thus received, or any part thereof, and distribution of the net proceeds of any such sale (net of the fees and expenses of the Depositary) to the ADS holders entitled thereto.

 

Voting Rights

 

Upon receipt of notice of any meeting of holders of shares at which holders of shares will be entitled to vote, if requested in writing by the Bank, the Depositary shall, as soon as practicable thereafter, notify ADS holders of a shareholders’ meeting and send or make voting materials available to them. Those materials will describe the matters to be voted on and explain how ADS holders may instruct the Depositary how to vote. For instructions to be valid, they must reach the Depositary by a date set by the Depositary. The Depositary will try, as far as practical, subject to the laws of the State of New York and the provisions of the estatutos of the Bank, to vote or to have its agents vote the shares or other deposited securities as instructed by ADS holders. If a notice has been sent, the ADS holders have been provided at least 30 days’ prior notice and no instructions have been received by the Depositary, the Depositary shall deem ADS holders to have instructed the Depositary to give a discretionary proxy to a person designated by the Bank, except that no such instruction shall be deemed given and no such discretionary proxy shall be given with respect to any matter as to which the Bank informs the Depositary (and the Bank agrees to provide such information as promptly as practicable in writing, if applicable) that (i) the Bank does not wish such proxy given, (ii) substantial opposition from holders of shares exists to the manner in which such deposited securities would be voted with respect to such matter or (iii) such matter materially and adversely affects the rights of holders of shares.

 

Except by instructing the Depositary as described above, ADS holders won’t be able to exercise voting rights unless they surrender their ADSs and withdraw the shares. However, ADS holders may not know about the meeting enough in advance to withdraw the shares.

 

Record Dates

 

The Depositary may fix a record date for the determination of the ADS holders who will be entitled to receive any distribution on or in respect of the deposited securities, to give instructions for the exercise of any voting rights, to receive any notice or to act in respect of other matters and only such ADS holders at such record date will be so entitled or obligated.

 

14

 

 

Charges

 

The Depositary may charge each person to whom ADSs are issued and each person surrendering ADSs for withdrawal of deposited securities in any manner permitted by the Deposit Agreement or whose ADSs are cancelled or reduced for any other reason. The Depositary may also charge certain other additional fees to ADS holders. See “Item 12. Description of Securities Other than Equity Securities—D. American Depositary Shares” of the Form 20-F for more information.

 

Payment of Taxes

 

If any tax or other governmental charge shall become payable by the custodian or the Depositary with respect to or in connection with any ADSs or any deposited securities represented by any ADSs, that tax or any other governmental charge shall be payable by the ADS holder of those ADSs to the Depositary. The Depositary may refuse to register any transfer of those ADSs or any withdrawal of deposited securities represented by those ADSs until that payment is made, and may withhold any dividends or other distributions or the proceeds thereof, or may sell for the account of the ADS holder any part or all of the deposited securities represented by those ADSs and apply those dividends or other distributions or the net proceeds of any sale of that kind in payment of that tax or other governmental charge but, even after a sale of that kind, the ADS holder of those ADSs shall remain liable for any deficiency.

 

Compliance with Chilean Law

 

ADS holders are deemed to be owners of the deposited securities for certain purposes under the Chilean law. Accordingly, the ADS holders shall be obligated to comply with the requirements of Articles 12 and 54 and Title XV of Law 18,045 of Chile relating to reports to the FMC and the stock exchanges in Chile concerning the acquisition (i) of 10% or more of the total share capital of the Bank, (ii) of shares or ADSs by directors, liquidators or officers of the Bank or (iii) of a control stake in the Bank.

 

Tender and Exchange Offers; Redemption, Replacement or Cancellation of Deposited Securities

 

The Depositary shall not tender any deposited securities in response to any voluntary cash tender offer, exchange offer or similar offer made to holders of deposited securities, except when instructed in writing to do so by an ADS holder surrendering ADSs and subject to any conditions or procedures the Depositary may require.

 

If the Depositary receives a written notice that deposited securities have been redeemed for cash or otherwise purchased for cash, the Depositary shall (i) if required, surrender deposited securities that have been redeemed, (ii) notify ADS holders of the redemption, call for surrender of a corresponding number of ADSs and notify them that the called ADSs have been converted into a right only to receive the money received by the Depositary upon that redemption and (iii) distribute the money received upon that redemption to the ADS holders entitled to it upon surrender by them of called ADSs.

 

15

 

 

If the Depositary is notified of or there occurs any change in nominal value or any subdivision, combination or any other reclassification of the deposited securities or any recapitalization, reorganization, sale of assets substantially as an entirety, merger or consolidation affecting the issuer of the deposited securities or to which it is a party that is mandatory and binding on the Depositary, then the Depositary shall, if required, surrender the old deposited securities and hold the new securities or other property delivered to it. However, the Depositary may elect to sell those new deposited securities if in the opinion of the Depositary it is not lawful or not practical for it to hold those new deposited securities under this Deposit Agreement because those new deposited securities may not be distributed to ADS holders without registration under the Securities Act of 1933 or for any other reason, at public or private sale, at such places and on such terms as it deems proper and proceed as if those new deposited securities had been redeemed.

 

In case of a replacement where the newly deposited securities will continue to be held under the Deposit Agreement, the Depositary may call for the surrender of outstanding receipts to be exchanged for new receipts specifically describing the new Deposited Securities and the number of those newly deposited securities represented by each ADSs.

 

If there are no deposited securities with respect to ADSs, including if the deposited securities are cancelled or have become apparently worthless, the Depositary may call for surrender of those ADSs or may cancel those ADSs, upon notice to ADS holders.

 

Amendment

 

Any provisions of the Deposit Agreement may at any time be amended by agreement between the Bank and the Depositary without the consent of ADS holders in any respect that they may deem necessary or desirable. Any amendment that would impose or increase any fees or charges (other than taxes and other governmental charges, registration fees, cable, telex or facsimile transmission costs, delivery costs or other such expenses), or that would otherwise prejudice any substantial existing right of ADS holders, shall, however, not become effective as to outstanding ADSs until the expiration of 30 days after notice of that amendment has been disseminated to the ADS holders of outstanding ADSs. Every ADS holder at the time any amendment so becomes effective, shall be deemed, by continuing to hold ADSs, to consent and agree to that amendment and to be bound by the Deposit Agreement as amended thereby. In no event shall any amendment impair the right of the ADS holder to surrender ADSs and receive delivery of the deposited securities represented thereby, except in order to comply with mandatory provisions of applicable law.

 

Termination

 

The Bank may initiate termination of the Deposit Agreement by notice to the Depositary. The Depositary may initiate termination of the Deposit Agreement if (i) at any time 90 days shall have expired after the Depositary delivered to the Bank a written resignation notice and a successor depositary has not been appointed and accepted its appointment, (ii) the Bank appears to be insolvent or enters insolvency proceedings, (iii) all or substantially all the value of the deposited securities has been distributed either in cash or in the form of securities, or (iv) all of the deposited securities underlying the ADSs have been redeemed. If termination of the Deposit Agreement is initiated, the Depositary shall disseminate a notice of termination to the ADS holders of all ADSs then outstanding setting a date for termination (the “Termination Date”), which shall be at least 120 days after the date of that notice, and the Deposit Agreement shall terminate on that Termination Date.

 

16

 

 

At any time after the Termination Date, the Depositary may sell the deposited securities then held under the Deposit Agreement and may thereafter hold uninvested the net proceeds of any such sale, together with any other cash then held by it, unsegregated and without liability for interest, for the pro rata benefit of the ADS holders of ADSs that remain outstanding, and those ADS holders will become general creditors of the Depositary with respect to those net proceeds.

 

After the Termination Date, the Depositary shall not accept deposits of shares or deliver A and the Depositary (i) may refuse to accept surrenders of ADSs for the purpose of withdrawal of deposited securities (that have not been sold) if in its judgment the requested withdrawal would interfere with its efforts to sell the deposited securities, (ii) will not be required to deliver cash proceeds of the sale of deposited securities until all deposited securities have been sold and (iii) may discontinue the registration of transfers of ADSs and suspend the distribution of dividends and other distributions on deposited securities to the ADS holders and need not give any further notices or perform any further acts under this Deposit Agreement.

 

Limitations on Obligations and Liability

 

The Deposit Agreement expressly limits the Bank’s obligations and the obligations of the Depositary. It also limits the Bank’s liability and the liability of the Depositary. The Bank and the Depositary:

 

are only obligated to take the actions specifically set forth in the Deposit Agreement without negligence or bad faith, and the Depositary will not be a fiduciary or have any fiduciary duty to ADS holders;

 

are not liable if they are prevented or delayed by law or by events or circumstances beyond our or its ability to prevent or counteract with reasonable care or effort from performing our or its obligations under the Deposit Agreement;

 

are not liable if they exercise discretion permitted under the Deposit Agreement;

 

are not liable for the inability of any ADS holder to benefit from any distribution on deposited securities that is not made available to ADS holders under the terms of the Deposit Agreement, or for any special, consequential or punitive damages for any breach of the terms of the Deposit Agreement;

 

have no obligation to become involved in a lawsuit or other proceeding related to the ADSs or the Deposit Agreement on ADS holders’ behalf or on behalf of any other person;

 

17

 

 

may rely upon any documents they believe in good faith to be genuine and to have been signed or presented by the proper person;

 

are not liable for the acts or omissions of any securities depository, clearing agency or settlement system; and

 

the Depositary has no duty to make any determination or provide any information as to the Bank’s tax status, or any liability for any tax consequences that may be incurred by ADS holders as a result of owning or holding ADSs.

 

In the Deposit Agreement, the Bank and the Depositary agree to indemnify each other under certain circumstances.

 

Requirements for Depositary Actions

 

Before the Depositary will deliver or register a transfer of ADSs, make a distribution on ADSs, or permit withdrawal of shares, the Depositary may require:

 

payment of stock transfer or other taxes or other governmental charges and transfer or registration fees charged by third parties for the transfer of any shares or other deposited securities;

 

satisfactory proof of the identity and genuineness of any signature or other information it deems necessary; and

 

compliance with regulations it may establish, from time to time, consistent with the Deposit Agreement, including presentation of transfer documents.

 

The depositary may refuse to deliver ADSs or register transfers of ADSs when the transfer books of the depositary or our transfer books are closed or at any time if the depositary or we think it advisable to do so.

 

18

 

 

Right to Receive the Shares Underlying your ADSs

 

ADS holders have the right to cancel their ADSs and withdraw the underlying shares at any time except:

 

when temporary delays arise because the Bank or the Depositary has closed its transfer books;

 

when an ADS holder owes money to pay fees, taxes and similar charges; or

 

when it is necessary to prohibit withdrawals in order to comply with any laws or governmental regulations that apply to ADSs or to the withdrawal of shares or other deposited securities.

 

This right of withdrawal may not be limited by any other provision of the Deposit Agreement.

 

Disclosure of Interests

 

When required in order to comply with applicable laws and regulations or the articles of incorporation or similar document of the Bank, the Bank may from time to time request each ADS holder to provide to the Depositary information relating to: (i) the capacity in which it holds ADSs, (ii) the identity of any ADS holder or other persons or entities then or previously interested in those ADSs and the nature of those interests and (iii) any other matter where disclosure of such matter is required for that compliance.

 

 

19

 

 

Exhibit 8.1

 

Subsidiaries

 

The following table sets forth our significant subsidiaries as of December 31, 2023, including the ownership interest and, if different, percentage of voting power held by us. All of our significant subsidiaries are incorporated in Chile.

 

      Percent ownership share 
      As of December 31, 
      2023 
      Direct   Indirect   Total 
Name of the Subsidiary  Main Activity  %   %   % 
                
Santander Corredora de Seguros Limitada  Insurance brokerage   99.75    0.01    99.76 
Santander Corredores de Bolsa Limitada  Financial instruments brokerage   50.59    0.41    51.00 
Santander Asesorías Financieras Limitada  Financial advisory   99.03    -    99.03 
Santander S.A. Sociedad Securitizadora  Purchase of credits and issuance of debt instruments   99.64    -    99.64 
Klare Corredora de Seguros S.A.  Insurance brokerage   50.10    -    50.10 
Santander Consumer Chile S.A.  Financing   51.00    -    51.00 
Sociedad Operadora de Tarjetas de Pago Santander Getnet Chile S.A.  Card operator   99.99    0.01    100.00 

 

Exhibit 12.1

 

CHIEF EXECUTIVE OFFICER SECTION 302 CERTIFICATION

 

I, Román Blanco, certify that:

 

1.I have reviewed this annual report on Form 20-F of Banco Santander-Chile;

 

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;

 

4.The company’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have:

 

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c)Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

d)Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and

 

5.The company’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions):

 

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and

 

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting.

 

Date: February 22, 2024

 

  /s/ Román Blanco
  Name: Román Blanco
  Title: Chief Executive Officer

 

Exhibit 12.2

 

CHIEF FINANCIAL OFFICER SECTION 302 CERTIFICATION

 

I, Emiliano Muratore, certify that:

 

1.I have reviewed this annual report on Form 20-F of Banco Santander-Chile;

 

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;

 

4.The company’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have:

 

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c)Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

d)Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and

 

5.The company’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions):

 

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and

 

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting.

 

Date: February 22, 2024

 

  /s/ Emiliano Muratore
  Name: Emiliano Muratore
  Title: Chief Financial Officer

 

 

 

Exhibit 12.3

 

FINANCIAL AND COSTS CONTROLLER SECTION 302 CERTIFICATION

 

I, Guillermo Sabater, certify that:

 

1.I have reviewed this annual report on Form 20-F of Banco Santander-Chile;

 

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;

 

4.The company’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have:

 

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

c)Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

d)Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and

 

5.The company’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions):

 

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and

 

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting.

 

Date: February 22, 2024

 

  /s/ Guillermo Sabater
  Name: Guillermo Sabater
  Title: Financial and Costs Controller

 

 

Exhibit 13.1

 

Section 906 Certification

 

The certification set forth below is being submitted in connection with the Annual Report on Form 20-F for the year ended December 31, 2023 (the “Report”) for the purpose of complying with Rule 13a-14(b) or Rule 15d-14(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Section 1350 of Chapter 63 of Title 18 of the United States Code.

 

Román Blanco, the Chief Executive Officer, Emiliano Muratore, the Chief Financial Officer, and Guillermo Sabater, the Financial and Costs Controller, of Banco Santander-Chile, each certifies that, to the best of his knowledge:

 

1.the Report fully complies with the requirements of Section 13(a) or 15(d) of the Exchange Act; and

 

2.the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Banco Santander-Chile.

 

Date: February 22, 2024

 

  /s/ Román Blanco
  Name: Román Blanco
  Title: Chief Executive Officer

 

  /s/ Emiliano Muratore
  Name: Emiliano Muratore
  Title: Chief Financial Officer

 

  /s/ Guillermo Sabater
  Name: Guillermo Sabater
  Title: Financial and Costs Controller

 

 

 

 

 

 

Exhibit 97.1

 

 

Remuneration Policy Banco Santander Chile

 

 

 

ANNEX: FINANCIAL STATEMENT COMPENSATION RECOUPMENT

This Annex provides for the recoupment of certain executive compensation in the event of an accounting restatement resulting from material noncompliance with financial reporting requirements under U.S. federal securities laws in accordance with the terms and conditions set forth herein. Banco Santander Chile (hereinafter, “Bank”) is subject to the Exchange Act (as defined below) and the listing rules of the NYSE (as defined below) given that its American Depositary Shares representing Banco Santander Chile ordinary shares are listed on the NYSE. This Annex is intended to comply with the requirements of Section 10D of the Exchange Act and Section 303A.14 of the NYSE Listed Company Manual (the “Listing Rule”).

 

1.Definitions. For the purposes of this Annex, the following terms shall have the meanings set forth below.

 

a)“Committee” means the Remuneration Committee of the Board of Directors of Banco Santander Chile (the “Board”) or any successor committee thereof.

 

b)“Covered Compensation” means any Incentive-based Compensation “received” by a Covered Executive during the applicable Recoupment Period; provided that:

 

(i)such Incentive-based Compensation was received by such Covered Executive:

 

(A)on or after the Effective Date,

 

(B)after he or she commenced service as an Executive Officer, and

 

(C)while the Bank had a class of securities publicly listed on a United States national securities exchange; and

 

(ii)such Covered Executive served as an Executive Officer at any time during the performance period applicable to such Incentive-based Compensation.

 

For purposes of this Annex, Incentive-based Compensation is “received” by a Covered Executive during the fiscal period in which the Financial Reporting Measure applicable to such Incentive-based Compensation (or portion thereof) is attained, even if the payment or grant of such Incentive-based Compensation is made thereafter.

 

c)“Covered Executive” means any current or former Executive Officer.

 

d)“Effective Date” means October 2, 2023.

 

e)“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended.

 

f)“Executive Officer” means, CEO and Country Head and members of the Senior Management of Banco Santander Chile, provided that, at a minimum, each individual who performs the duties of an Executive Officer (within the meaning of the Listing Rule) shall be considered an Executive Officer. The determination as to an individual’s status as an Executive Officer shall be made by the Board upon recommendation of the Committee and such determination shall be final, conclusive and binding on such individual and all other interested persons.

 

g)“Financial Reporting Measure” means any (i) measure that is determined and presented in accordance with the accounting principles used in preparing the Bank’s financial statements; (ii) share price measure; or (iii) total shareholder return measure (and any measures that are derived wholly or in part from any measure referenced in clause (i), (ii) or (iii) above). For the avoidance of doubt, any such measure does not need to be presented within the Bank’s financial statements or included in a filing with the U.S. Securities and Exchange Commission to constitute a Financial Reporting Measure.

 

Human Resources Vice-presidency
Page 1 | 5

 

 

 

Remuneration Policy Banco Santander Chile

 

 

 

h)“Financial Restatement” means a restatement of the Bank’s financial statements due to the Bank’s material noncompliance with any financial reporting requirement under U.S. federal securities laws that is required in order to correct:

 

(i)an error in previously issued financial statements that is material to the previously issued financial statements; or

 

(ii)an error that would result in a material misstatement if the error were (A) corrected in the current period or (B) left uncorrected in the current period.

 

For purposes of this Annex, a Financial Restatement shall not be deemed to occur in the event of a revision of the Bank’s financial statements due to an out-of-period adjustment (i.e., when the error is immaterial to the previously issued financial statements and the correction of the error is also immaterial to the current period) or a retrospective (1) application of a change in accounting principles; (2) revision to reportable segment information due to a change in the structure of the Bank’s internal organization; (3) reclassification due to a discontinued operation; (4) application of a change in reporting entity, such as from a reorganization of entities under common control; (5) revision for stock splits, reverse stock splits, stock dividends or other changes in capital structure; or (6) adjustment to provisional amounts in connection with a prior business combination.

 

i)“Incentive-based Compensation means any compensation (including, for the avoidance of doubt, any cash or equity or equity-based compensation, whether deferred or current) that is granted, earned and/or vested based wholly or in part upon the achievement of a Financial Reporting Measure. For purposes of this Policy, “Incentive-based Compensation” shall also be deemed to include any amounts which were determined based on (or were otherwise calculated by reference to) Incentive-based Compensation (including, without limitation, any amounts under any long-term disability, life insurance or supplemental retirement or severance plan or agreement or any notional amount, in each case, solely to the extent such amounts are based on (or were otherwise calculated by reference to) Incentive-based Compensation, as well as any earnings accrued thereon).

j)“NYSE” means the New York Stock Exchange, or any successor thereof.

 

k)“Recoupment Period” means the three (3) fiscal years completed immediately preceding the date of any applicable Recoupment Trigger Date. Notwithstanding the foregoing, the Recoupment Period additionally includes any transition period (that results from a change in the Bank’s fiscal year) within or immediately following those three (3) completed fiscal years, provided that a transition period between the last day of the Bank’s previous fiscal year end and the first day of its new fiscal year that comprises a period of nine (9) to twelve (12) months shall be deemed a completed fiscal year.

l)“Recoupment Trigger Date” means the earlier of (i) the date that the Board concludes, or reasonably should have concluded, that the Bank is required to prepare a Financial Restatement, and (ii) the date on which a court, regulator or other legally authorized body directs the Bank to prepare a Financial Restatement.

 

2.Recoupment of Erroneously Awarded Compensation.

 

a)In the event of a Financial Restatement, if the amount of any Covered Compensation received by a Covered Executive (the “Awarded Compensation”) exceeds the amount of such Covered Compensation that would have otherwise been received by such Covered Executive if calculated based on the Financial Restatement (the “Adjusted Compensation”), the Bank shall reasonably promptly recover from such Covered Executive an amount equal to the excess of the Awarded Compensation over the Adjusted Compensation, each calculated on a pre-tax basis (such excess amount, the “Erroneously Awarded Compensation”).

 

Human Resources Vice-presidency
Page 2 | 5

 

 

 

Remuneration Policy Banco Santander Chile

 

 

 

b)If (i) the Financial Reporting Measure applicable to the relevant Covered Compensation is share price or total shareholder return (or any measure derived wholly or in part from either of such measures) and (ii) the amount of Erroneously Awarded Compensation is not subject to mathematical recalculation directly from the information in the Financial Restatement, then the amount of Erroneously Awarded Compensation shall be determined (on a pre-tax basis) based on the Bank’s reasonable estimate of the effect of the Financial Restatement on the Bank’s share price or total shareholder return (or the derivative measure thereof) upon which such Covered Compensation was received.

 

c)For the avoidance of doubt, the Bank’s obligation to recover Erroneously Awarded Compensation is not dependent on (i) if or when the restated financial statements are filed or (ii) any fault of any Covered Executive for the accounting errors or other actions leading to a Financial Restatement.

 

d)Notwithstanding anything to the contrary in Section 2(‎a) through (‎c) hereof, the Bank shall not be required to recover any Erroneously Awarded Compensation if both (x) the conditions set forth in either of the following clauses (i), (ii) or (iii) are satisfied and (y) the members of the Board, in accordance with Listing Rule Section 303A.14(c)(1)(iv), upon recommendation of the Committee, have determined that recovery of the Erroneously Awarded Compensation would be impracticable:

 

(i)the direct expense paid to a third party to assist in enforcing the recovery of the Erroneously Awarded Compensation under this Policy would exceed the amount of such Erroneously Awarded Compensation to be recovered; provided that, before concluding that it would be impracticable to recover any amount of Erroneously Awarded Compensation pursuant to this Section 2(‎d), the Bank shall have first made a reasonable attempt to recover such Erroneously Awarded Compensation, document such reasonable attempt(s) to make such recovery and provide that documentation to the NYSE;

 

(ii)recovery of the Erroneously Awarded Compensation would violate the law of Chile to the extent such law was adopted prior to November 28, 2022 (provided that, before concluding that it would be impracticable to recover any amount of Erroneously Awarded Compensation pursuant to this Section 2(d)), the Bank shall have first obtained an opinion of Chilean counsel, that is acceptable to the NYSE, that recovery would result in such a violation, and the Bank must provide such opinion to the NYSE; or

 

(iii)recovery of the Erroneously Awarded Compensation would likely cause an otherwise tax-qualified retirement plan, under which benefits are broadly available to employees of the Bank, to fail to meet the requirements of Sections 401(a)(13) or 411(a) of the U.S. Internal Revenue Code of 1986, as amended (the “Code”).

 

e)The Bank shall not indemnify any Covered Executive, directly or indirectly, for any losses that such Covered Executive may incur in connection with the recovery of Erroneously Awarded Compensation pursuant to this Annex, including through the payment of insurance premiums or gross-up payments.

 

Human Resources Vice-presidency
Page 3 | 5

 

 

 

Remuneration Policy Banco Santander Chile

 

 

 

f)The Board, upon recommendation of the Committee, shall determine, in its sole discretion, the manner and timing in which any Erroneously Awarded Compensation shall be recovered from a Covered Executive in accordance with applicable law, including, without limitation, by (i) requiring reimbursement of Covered Compensation previously paid in cash; (ii) seeking recovery of any gain realized on the vesting, exercise, settlement, sale, transfer or other disposition of any equity or equity-based awards; (iii) offsetting the Erroneously Awarded Compensation amount from any compensation otherwise owed by the Bank or any of its affiliates to the Covered Executive; (iv) cancelling outstanding vested or unvested equity or equity-based awards; and/or (v) taking any other remedial and recovery action permitted by applicable law. For the avoidance of doubt, except as set forth in Section 2(d), in no event may the Bank accept an amount that is less than the amount of Erroneously Awarded Compensation; provided that, to the extent necessary to avoid any adverse tax consequences to the Covered Executive pursuant to Section 409A of the United States Internal Revenue Code of 1986, as amended (the “Code”) (or any other applicable tax law), to the extent practicable, any offsets against amounts under any nonqualified deferred compensation plans (as defined under Section 409A of the Code) (or any compensation deferred pursuant to any other applicable tax law) shall be made in compliance with Section 409A of the Code or such other applicable tax law.

 

3.Amendment/Termination. Subject to Section 10D of the Exchange Act and the Listing Rule, this Annex may be amended or terminated by the Bank at any time subject to the approval by the Board upon recommendation of the Committee. To the extent that any applicable law, or stock market or exchange rules or regulations require recovery of Erroneously Awarded Compensation in circumstances in addition to those specified herein, nothing in this Annex shall be deemed to limit or restrict the right or obligation of the Bank to recover Erroneously Awarded Compensation to the fullest extent required by such applicable law, stock market or exchange rules and regulations. Unless otherwise required by applicable law, this Annex shall no longer be effective from and after the date that the Bank no longer has a class of securities publicly listed on a United States national securities exchange.

 

4.Interpretation. Notwithstanding anything to the contrary herein, this Annex is intended to comply with the requirements of Section 10D of the Exchange Act and the Listing Rule (and any applicable regulations, administrative interpretations or stock market or exchange rules and regulations adopted in connection therewith). The provisions of this Annex shall be interpreted in a manner that satisfies such requirements and this Policy shall be operated accordingly. If any provision of this Policy would otherwise frustrate or conflict with this intent, the provision shall be interpreted and deemed amended so as to avoid such conflict.

 

5.Other Compensation Recoupment Rights. Any right of recoupment under this Annex is in addition to, and not in lieu of, any other remedies, rights or requirements with respect to the recoupment of any compensation that may be available to the Bank pursuant to the terms of any other recoupment policy or normative document of the Bank (or any of its affiliates) that may be in effect from time to time, any provisions in any employment agreement, offer letter, equity plan, equity award agreement or similar plan or agreement, and any other legal remedies available to the Bank, as well as applicable law, stock market or exchange rules, listing standards or regulations; provided, however, that any amounts recouped under any other policy or normative document that would be recoupable under this Annex shall count toward any required recoupment under this Annex and vice versa.

 

6.Exempt Compensation. Notwithstanding anything to the contrary herein, the Bank has no obligation under this Annex to seek recoupment of amounts paid to a Covered Executive which are granted, vested or earned based solely upon the occurrence or non-occurrence of nonfinancial events. Such exempt compensation includes, without limitation, base salary, time-vesting awards, compensation awarded on the basis of the achievement of metrics that are not Financial Reporting Measures or compensation awarded solely at the discretion of the Bank, provided that such amounts are in no way contingent on and were not in any way granted on the basis of, the achievement of any Financial Reporting Measure performance goal.

 

Human Resources Vice-presidency
Page 4 | 5

 

 

 

Remuneration Policy Banco Santander Chile

 

 

 

7.Miscellaneous.

 

a)Any applicable award agreement or other document setting forth the terms and conditions of any compensation covered by this Annex shall be deemed to include the restrictions imposed herein and incorporate this Annex by reference and, in the event of any inconsistency, the terms of this Annex will govern. For the avoidance of doubt, this Annex applies to all compensation that is received on or after the Effective Date, regardless of the date on which the award agreement or other document setting forth the terms and conditions of the Covered Executive’s compensation became effective, including, without limitation, compensation received under the Bank’s deferred variable remuneration plans and any successor plan to each of the foregoing.

 

b)This Annex shall be binding and enforceable against all Covered Executives and their beneficiaries, heirs, executors, administrators, or other legal representatives.

 

c)All issues concerning the construction, validity, enforcement and interpretation of this Annex and all related documents, including, without limitation, any employment agreement, offer letter, equity award agreement or similar agreement, shall be governed by, and construed in accordance with, the laws of Chile, without giving effect to any choice of law or conflict of law rules or provisions (whether of Chile or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than Chile.

 

d)The Covered Executives, their beneficiaries, heirs, executors, administrators and any other legal representative and the Bank shall initially attempt to resolve all claims, disputes or controversies arising under, out of or in connection with this Annex by conducting good faith negotiations amongst themselves. To ensure the timely and economical resolution of disputes that arise in connection with this Annex, the courts and tribunals of the city of Santiago (Chile) shall have exclusive jurisdiction to settle any disputes, claims, or causes of action arising from or relating to the enforcement, performance or interpretation of this Annex. The Covered Executives, their beneficiaries, heirs, executors, administrators and any other legal representative and the Bank hereby waive any objection to any such court as is referred to in this Section 7(d) on grounds of inconvenient forum or otherwise as regards proceedings in connection with the Agreement and further irrevocably agree that a judgment or order of any such court in connection with the Agreement shall be conclusive and binding on it and may be enforced against it in the courts of any other jurisdiction.

 

e)If any provision of this Annex is determined to be unenforceable or invalid under any applicable law, such provision will be applied to the maximum extent permitted by applicable law and shall automatically be deemed amended in a manner consistent with its objectives to the extent necessary to conform to any limitations required under applicable law. In the event that any one or more of the provisions of this Annex shall be held to be invalid and unenforceable, all the other terms and provisions of this Annex shall continue in full force and effect without impairment or limitation to the maximum extent permitted by applicable law.

 

Human Resources Vice-presidency
Page 5 | 5