UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K/A
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE
SECURITIES EXCHANGE ACT OF 1934
For the month of December, 2018
Commission File Number 1-11414
BANCO LATINOAMERICANO DE COMERCIO EXTERIOR, S.A.
(Exact name of Registrant as specified in its Charter)
FOREIGN TRADE BANK OF LATIN AMERICA, INC.
(Translation of Registrant’s name into English)
Business Park Torre V, Ave. La Rotonda, Costa del Este
P.O. Box 0819-08730
Panama City, Republic of Panama
(Address of Registrant’s Principal Executive Offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F x Form 40-F ¨
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
Yes ¨ No x
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):
Yes ¨ No x
EXPLANATORY NOTES
This Report of Foreign Private Issuer on Form 6-K/A (this “Amended Report”) is furnished to amend and restate information contained on certain pages of the Report of Foreign Private Issuer on Form 6-K furnished to the Securities and Exchange Commission by Banco Latinoamericano de Comercio Exterior, S.A. on November 2, 2018 as amended by the Issuer on Form 6-K/A on December 4, 2018 (together, the “Original Report”) solely to present the financial statements on a condensed basis, in compliance with IAS 34 – Interim Financial Statement.
The amended pages are:
| a. | Unaudited condensed consolidated interim statements of changes in stockholder’s equity (page 6) |
Reason for amendment: The Bank elected to restate its condensed consolidated interim statement of changes in stockholder’s equity because the movements of the Dynamic Provision and Regulatory Reserve for the periods ended as of September 30, 2017 and 2016 had not been included therein.
| b. | Unaudited condensed consolidated interim statements of cash flow (page 7) |
Reason for amendment: The Bank elected to restate its condensed consolidated interim statement of cash flow for these periods due to the omission of a line item within cash flows from operating activities. The omitted line is “Write-offs against the allowance for expected credit losses on loans”
| c. | The presentation of the breakdown of the Bank’s loans commitments and financial guarantees contracts exposure by country risk in Note 6 – Loans commitments and financial guarantees contracts (page 45) |
Reason for amendment: As of September 30, 2018, due to a formatting issue, the amounts presented in the table beginning with the Ecuador line item and continuing to the bottom of the table before the “Total” line item do not correctly correspond to the countries indicated, since the amounts were not aligned with the correct countries. Nevertheless, the total amounts are correct. The Bank has elected to restate this page.
The rest of the information presented in Form 6-K (the “Original Report”) on November 2, 2018 is correct. This condensed consolidated interim financial report does not include all of the notes of the type normally included in an annual financial report. This report is to be read in conjunction with the Bank’s most recent annual report on Form 20-F. The accounting policies have been omitted as the accounting policies adopted are consistent with those of the previous financial year.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: December 4, 2018
| FOREIGN TRADE BANK OF LATIN AMERICA, INC. | ||
| (Registrant) | ||
| By: | /s/ Ana Graciela de Méndez | |
| Name: Ana Graciela de Méndez | ||
| Title: CFO | ||
| Banco Latinoamericano de Comercio Exterior, S. A. and Subsidiaries | ||||||
| Unaudited condensed consolidated interim statements of changes in stockholders's equity | ||||||
| For the nine months ended September 30, 2018, 2017 and 2016 | ||||||
| (In US$ thousand) | ||||||
| Common stock | Treasury stock | Additional paid-in capital in excess of assigned value of common stock | Capital reserves | Dynamic provision | Regulatory reserve | Retained earnings | Accumulated other comprehensive income (loss) | Total | ||||||||||||||||||||||||||||
| Balances at January 1, 2016 | 279,980 | (73,397 | ) | 120,177 | 95,210 | 30,788 | 7,920 | 521,934 | (10,681 | ) | 971,931 | |||||||||||||||||||||||||
| Profit for the period | - | - | - | - | - | - | 73,701 | - | 73,701 | |||||||||||||||||||||||||||
| Other comprehensive income | - | - | - | - | - | - | - | 6,297 | 6,297 | |||||||||||||||||||||||||||
| Issuance of restricted stock | - | 1,259 | (1,259 | ) | - | - | - | - | - | - | ||||||||||||||||||||||||||
| Compensation cost - stock options and stock units plans | - | - | 2,480 | - | - | - | - | - | 2,480 | |||||||||||||||||||||||||||
| Exercised options and stock units vested | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||
| Repurchase of "Class B" and "Class E" common stock | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||
| Regulatory reserve | - | 2,953 | (1,387 | ) | - | - | (2,203 | ) | 2,203 | - | 1,566 | |||||||||||||||||||||||||
| Dymanic provision | - | - | - | - | 10,244 | - | (10,244 | ) | - | - | ||||||||||||||||||||||||||
| Dividends declared | - | - | - | - | - | - | (45,104 | ) | - | (45,104 | ) | |||||||||||||||||||||||||
| Balances at September 30, 2016 | 279,980 | (69,185 | ) | 120,011 | 95,210 | 41,032 | 5,717 | 542,490 | (4,384 | ) | 1,010,871 | |||||||||||||||||||||||||
| Balances at January 1, 2017 | 279,980 | (69,176 | ) | 120,594 | 95,210 | 43,826 | 18,633 | 525,048 | (2,801 | ) | 1,011,314 | |||||||||||||||||||||||||
| (Loss) profit for the period | - | - | - | - | - | - | 61,400 | - | 61,400 | |||||||||||||||||||||||||||
| Other comprehensive income (loss) | - | - | - | - | - | - | - | 1,058 | 1,058 | |||||||||||||||||||||||||||
| Issuance of restricted stock | - | 1,259 | (1,229 | ) | - | - | - | - | - | 30 | ||||||||||||||||||||||||||
| Compensation cost - stock options and stock units plans | - | - | (38 | ) | - | - | - | - | - | (38 | ) | |||||||||||||||||||||||||
| Exercised options and stock units vested | - | 3,278 | 109 | - | - | - | - | - | 3,387 | |||||||||||||||||||||||||||
| Repurchase of "Class B" and "Class E" common stock | - | (28 | ) | - | - | - | - | - | - | (28 | ) | |||||||||||||||||||||||||
| Regulatory reserve | - | - | - | - | - | (10,637 | ) | 10,637 | - | - | ||||||||||||||||||||||||||
| Dymanic provision | - | - | - | - | 63,566 | - | (63,566 | ) | - | - | ||||||||||||||||||||||||||
| Dividends declared | - | - | - | - | - | - | (45,384 | ) | - | (45,384 | ) | |||||||||||||||||||||||||
| Balances at September 30, 2017 | 279,980 | (64,667 | ) | 119,436 | 95,210 | 107,392 | 7,996 | 488,135 | (1,743 | ) | 1,031,739 | |||||||||||||||||||||||||
| Balances at January 1, 2018 | 279,980 | (63,248 | ) | 119,941 | 95,210 | 108,756 | 20,498 | 479,712 | 1,963 | 1,042,812 | ||||||||||||||||||||||||||
| Profit for the period | - | - | - | - | - | - | (9,595 | ) | - | (9,595 | ) | |||||||||||||||||||||||||
| Other comprehensive income | - | - | - | - | - | - | - | (389 | ) | (389 | ) | |||||||||||||||||||||||||
| Issuance of restricted stock | - | 1,259 | (1,259 | ) | - | - | - | - | - | - | ||||||||||||||||||||||||||
| Compensation cost - stock options and stock units plans | - | - | 587 | - | - | - | - | - | 587 | |||||||||||||||||||||||||||
| Exercised options and stock units vested | - | 3,355 | 254 | - | - | - | - | - | 3,609 | |||||||||||||||||||||||||||
| Repurchase of "Class B" and "Class E" common stock | - | (2,442 | ) | - | - | - | - | - | - | (2,442 | ) | |||||||||||||||||||||||||
| Regulatory reserve | - | - | - | - | - | (20,473 | ) | 20,473 | - | - | ||||||||||||||||||||||||||
| Dymanic provision | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||
| Dividends declared | - | - | - | - | - | - | (45,631 | ) | - | (45,631 | ) | |||||||||||||||||||||||||
| Balances at September 30, 2018 | 279,980 | (61,076 | ) | 119,523 | 95,210 | 108,756 | 25 | 444,959 | 1,574 | 988,951 | ||||||||||||||||||||||||||
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
| 6 |
| Banco Latinoamericano de Comercio Exterior, S. A. and Subsidiaries |
| Unaudited condensed consolidated interim statements of cash flows |
| For the nine months ended September 30, 2018, 2017 and 2016 |
| (In US$ thousand) |
| 2018 | 2017 | 2016 | ||||||||||
| Cash flows from operating activities | ||||||||||||
| (Loss) profit for the period | (9,595 | ) | 61,400 | 73,701 | ||||||||
| Adjustments to reconcile profit for the year to net cash provided by (used in) operating activities: | ||||||||||||
| Activities of derivative financial instruments used for hedging | 1,929 | (35,559 | ) | (18,947 | ) | |||||||
| Depreciation of equipment and leasehold improvements | 957 | 1,171 | 1,039 | |||||||||
| Amortization of intangible assets | 1,011 | 553 | 425 | |||||||||
| Loss for disposal of equipment and leasehold improvements | 840 | 150 | - | |||||||||
| Loss for disposal of intangible assets | 2,705 | 14 | - | |||||||||
| Loss on investment properties at fair value through profit or loss | 1,560 | - | - | |||||||||
| Impairment loss from expected credit losses | 58,836 | 8,645 | 17,408 | |||||||||
| (Loss) gain on sale of financial assets at fair value through OCI | - | (79 | ) | 246 | ||||||||
| Amortization of premium and discount related to securities at amortized cost | 798 | 601 | 863 | |||||||||
| Gain on sale of property and equipment | 18 | - | - | |||||||||
| Impairment loss on other assets | 3,464 | - | - | |||||||||
| Compensation cost - share-based payment | 587 | (38 | ) | 2,480 | ||||||||
| Interest income | (184,376 | ) | (170,280 | ) | (184,453 | ) | ||||||
| Interest expense | 102,601 | 78,606 | 66,924 | |||||||||
| Net decrease (increase) in operating assets: | ||||||||||||
| Net decrease (increase) in pledged deposits | 25,320 | 18,720 | (3,385 | ) | ||||||||
| Financial instruments at fair value through profit or loss | - | - | 53,383 | |||||||||
| Net decrease (increase) in loans | (216,489 | ) | 676,129 | 297,758 | ||||||||
| Write-off against the allowance for expected credit losses on loans | (4,484 | ) | (4,240 | ) | 907 | |||||||
| Other assets | (15,281 | ) | (2,514 | ) | 4,044 | |||||||
| Net increase (decrease) in operating liabilities: | ||||||||||||
| Net increase due to depositors | (151,309 | ) | 200,157 | 330,536 | ||||||||
| Financial liabilities at fair value through profit or loss | - | (24 | ) | (89 | ) | |||||||
| Other liabilities | 13,218 | (15,842 | ) | (16,850 | ) | |||||||
| Cash provided by operating activities | (367,690 | ) | 817,570 | 625,990 | ||||||||
| Interest received | 169,881 | 181,598 | 184,608 | |||||||||
| Interest paid | (94,990 | ) | (77,018 | ) | (62,640 | ) | ||||||
| Net cash provided by operating activities | (292,799 | ) | 922,150 | 747,958 | ||||||||
| Cash flows from investing activities: | ||||||||||||
| Acquisition of equipment and leasehold improvements | (1,131 | ) | (622 | ) | (1,520 | ) | ||||||
| Acquisition of intangible assets | (45 | ) | (26 | ) | (3,084 | ) | ||||||
| Proceeds from the sale of investment property | 1,270 | - | - | |||||||||
| Proceeds from the redemption of securities at fair value through OCI | 3,244 | - | 77,286 | |||||||||
| Proceeds from the sale of securities at fair value through OCI | - | 15,177 | 107,888 | |||||||||
| Proceeds from maturities of securities at amortized cost | 6,324 | 14,240 | 43,212 | |||||||||
| Purchases of securities at fair value through OCI | - | - | (91,972 | ) | ||||||||
| Purchases of securities at amortized cost | (15,701 | ) | (8,324 | ) | (23,713 | ) | ||||||
| Net cash provided by investing activities | (6,039 | ) | 20,445 | 108,097 | ||||||||
| Cash flows from financing activities: | ||||||||||||
| Increase (decrease) net in short-term borrowings and debt and securities sold under repurchase agreements | 204,647 | (732,946 | ) | (1,310,550 | ) | |||||||
| Proceeds from long-term borrowings and debt | 532,206 | 220,172 | 374,859 | |||||||||
| Repayments of long-term borrowings and debt | (247,098 | ) | (639,114 | ) | (425,301 | ) | ||||||
| Dividends paid | (45,860 | ) | (45,449 | ) | (45,104 | ) | ||||||
| Exercised stock options | 3,609 | 3,387 | 1,566 | |||||||||
| Repurchase of common stock | (2,442 | ) | (28 | ) | - | |||||||
| Net cash used in financing activities | 445,062 | (1,193,978 | ) | (1,404,530 | ) | |||||||
| Increase (decrease) net in cash and cash equivalents | 146,224 | (251,383 | ) | (548,475 | ) | |||||||
| Cash and cash equivalents at beginning of the period | 618,807 | 1,007,726 | 1,267,302 | |||||||||
| Cash and cash equivalents at end of the period | 765,031 | 756,343 | 718,827 | |||||||||
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
| 7 |
Banco Latinoamericano de Comercio Exterior, S. A. and Subsidiaries
Notes to the unaudited condensed consolidated interim financial statements
(Amounts expressed in thousands of U.S. dollars, unless otherwise indicated)
| 6. | Loans commitments and financial guarantees contracts (continued) |
The breakdown of the Bank’s loans commitments and financial guarantees contracts exposure by country risk is as follows:
September 30, 2018 | December 31, 2017 | |||||||
| Country: | ||||||||
| Argentina | 45,652 | 7,546 | ||||||
| Bolivia | 200 | 200 | ||||||
| Brazil | 50,000 | - | ||||||
| Canada | 422 | 425 | ||||||
| Chile | - | 15,000 | ||||||
| Colombia | 76,634 | 91,020 | ||||||
| Costa Rica | 44,872 | 19,848 | ||||||
| Dominican Republic | 16,500 | - | ||||||
| Ecuador | 176,219 | 252,800 | ||||||
| El Salvador | 4,900 | 767 | ||||||
| Guatemala | 11,700 | 11,788 | ||||||
| Honduras | 550 | 890 | ||||||
| Mexico | 30,114 | 35,643 | ||||||
| Panama | 96,150 | 31,260 | ||||||
| Paraguay | - | 22 | ||||||
| Peru | - | 17,618 | ||||||
| Uruguay | 1,927 | 3,176 | ||||||
| Total | 555,840 | 488,003 | ||||||
Letters of credit and guarantees
The Bank, on behalf of its client’s base, advises and confirms letters of credit to facilitate foreign trade transactions. When confirming letters of credit, the Bank adds its own unqualified assurance that the issuing bank will pay and that if the issuing bank does not honor drafts drawn on the letter of credit, the Bank will. The Bank provides stand-by letters of credit and guarantees, which are issued on behalf of institutional clients in connection with financing between its clients and third parties. The Bank applies the same credit policies used in its lending process, and once issued the commitment is irrevocable and remains valid until its expiration. Credit risk arises from the Bank's obligation to make payment in the event of a client’s contractual default to a third party. Risks associated with stand-by letters of credit and guarantees are included in the evaluation of the Bank’s overall credit risk.
Credit commitments
Commitments to extend credit are binding legal agreements to lend to clients. Commitments generally have fixed expiration dates or other termination clauses and require payment of a fee to the Bank. As some commitments expire without being drawn down, the total commitment amounts do not necessarily represent future cash requirements.
| 45 |