INVESTMENTS

12 Months Ended

Dec. 31, 2021

INVESTMENTS [Abstract]

INVESTMENTS

6 INVESTMENTS

a) Investment at fair value through profit or loss consist of the following:

	2021		2020
	S/(000)		S/(000)
Mutual funds (i)		1,574,233		979,296
Government treasury bonds (ii)		1,185,541		1,584,913
Certificates of deposit BCRP (iii)		1,111,142		1,872,875
Investment funds (iv)		531,847		362,493
Restricted mutual funds (v)		365,954		436,881
Participation in RAL Funds (vi)		323,139		278,819
Hedge funds		176,816		126,938
Corporate bonds		172,857		328,315
Subordinated bonds		110,484		103,162
ETF (Exchange - Traded Fund)		105,305		32,085
Shares (vii)		90,728		289,349
Multilateral organization bonds		33,082		14,765
Central Bank of Chile bonds		32,761		15,306
RPI International Holding, LP (viii)		–		5,641
Others (ix)		105,310		23,259
Balance before accrued interest		5,919,199		6,454,097
Accrued interest		9,298		13,374
Total		5,928,497		6,467,471

(i) As of December 31, 2021, the balance corresponds to mutual funds from Luxembourg, Bolivia, Ireland and other countries, which represent 70.5 percent, 21.5 percent, 3.8 percent and 4.2 percent of the total, respectively, (from Peru, Luxembourg, Bolivia and other countries, which represent 30.9 percent, 29.5 percent, 28.8 percent and 10.8 percent of the total, respectively, as of December 31, 2020). The increase in the balance corresponds mainly to (i) the purchase of participations in the fund “BNP Paribas Insticash US$1D Short Term VNAV Classic Cap”, whose balance as of December, 31 2021 was S/279.3 million, and (ii) the purchase of new participations mainly in funds managed by Credicorp Capital Asset Management S.A. Administradora General de Fondos, whose balance as of December 31, 2021 was S/280.9 million.

(ii) As of December 31, 2021 and 2020 the balance of these instruments includes the following government treasury bonds:

	2021		2020
	S/(000)		S/(000)
Colombian Treasury bonds		898,733		1,120,991
Peruvian Treasury bonds		211,571		349,219
U.S. treasury and federal agency bonds		7,948		–
Chile Treasury bonds		66,643		21,072
Brasil Treasury bonds		646		53,857
Panama Treasury bonds		–		20,644
Mexico Treasury bonds		–		19,130
Total		1,185,541		1,584,913

(iii)
As of December 31, 2021, the balance corresponds to 2,789 certificates of deposit for US$278.7 million, equivalent to S/1,111.1 million, whose interest rates are from 0.67 percent to 0.70 percent, and with maturity from October to November 2021 (5,174 certificates of deposit for US$517.23 million, equivalent to S/1,872.9 million, accruing interest at an effective annual rate from 0.25 percent to 0.28 percent, and with maturity from January to March 2021, as of December 31, 2020). The variation corresponds to the maturity of the instruments.

(iv) As of December 31, 2021, the balance corresponds mainly to investment funds in Peru and the United States that represent 40.6 percent and 55.6 percent, respectively, among other countries (Peru and the United States that represented 40.0 percent and 25.6 percent, respectively, as of December 31, 2020). The increase in the balance corresponds to the increase in the investment funds Tishman Speyer Properties LP in S/39.3 million, Compass Group SAFI in S/38.4 million, Carlyle Peru Fund L.P. in S/31.5 million, and BD Capital SAFI S.A.C in S/22.2 million, among others.

(v) The restricted mutual funds comprise the participation quotas in the private pension funds managed by Prima AFP and are maintained in compliance with the legal regulations in Peru. Their availability is restricted and the yield received is the same as that received by the private pension funds managed.

(vi) As of December 31, 2021, these funds amount approximately to Bs 346.1 million, equivalent to S/202.3 million, and US$30.3 million, equivalent to S/120.8 million (Bs 325.1 million, equivalent to S/173.2 million, and US$29.2 million, equivalent to S/105.6 million as December 31, 2020) and comprise the investments made by the Group in the Central Bank of Bolivia as collateral for deposits received from the public. These funds have restrictions for their use and are required from all banks in Bolivia.

(vii) The decrease of the balance corresponds mainly to the sale of Royalty Pharma plc’s ordinary shares. As of December 31, 2021, all of these shares were sold (757,692 shares for US$37.9 million, equivalent to S/137.2 million, as of December 31, 2020).

(viii)
During the first trimester of 2021, all participations were liquidated.

As of December 31, 2020, the balance corresponds to participations in RPI International Holding, LP, who invests in a series of subordinate funds whose objective is to invest in Royalty Pharma Investments, an investment fund established under the laws of Ireland. This investment fund is dedicated to buying medical and biotechnology patents. Participations in RPI International Holdings, LP, are not liquid and require authorization for negotiation.

(ix) The increase mainly comprises the acquisition of finance lease bonds for S/94.4 million.

b) Investments at fair value through other comprehensive income consist of the following:

	2021									2020
			Unrealized gross amount									Unrealized gross amount
	Cost		Profits		Losses			Estimated fair value		Cost		Profits		Losses			Estimated fair value
		S/(000)		S/(000)		S/(000)			S/(000)		S/(000)		S/(000)		S/(000)			S/(000)
Debts instruments:
Corporate bonds (i)		14,456,083		594,025		(334,687	)		14,715,421		12,177,023		1,132,719		(52,953	)		13,256,789
Government treasury bonds (ii)		9,600,115		206,701		(568,417	)		9,238,399		11,051,662		1,158,845		(5,458	)		12,205,049
Certificates of deposit BCRP (iii)		8,347,101		7		(9,676	)		8,337,432		15,343,851		20,431		–			15,364,282
Securitization instruments (iv)		768,012		20,202		(66,825	)		721,389		703,920		63,131		(21,471	)		745,580
Negotiable certificates of deposit (v)		615,514		10,505		(1,508	)		624,511		873,218		14,093		(1,420	)		885,891
Subordinated bonds		217,222		6,281		(4,224	)		219,279		191,966		19,933		(317	)		211,582
Others		125,877		4,699		(4,324	)		126,252		147,327		14,802		(44	)		162,085
		34,129,924		842,420		(989,661	)		33,982,683		40,488,967		2,423,954		(81,663	)		42,831,258
Equity instruments designated at the initial recognition
Shares issued by:
Inversiones Centenario		112,647		72,124		–			184,771		112,647		168,132		–			280,779
Alicorp S.A.A.		12,197		125,356		–			137,553		12,198		153,935		–			166,133
Bolsa de Valores de Lima		19,423		6,730		–			26,153		19,423		3,942		–			23,365
Bolsa de Comercio de Santiago		3,648		4,108		–			7,756		15,306		–		(3,995	)		11,311
Compañía Universal Textil S.A.		9,597		–		(3,233	)		6,364		9,597		–		(3,163	)		6,434
Pagos Digitales Peruanos S.A.		5,197		–		(5,197	)		–		5,197		–		(5,197	)		-
Bolsa de Valores de Colombia		4,402		–		(188	)		4,214		5,380		118		–			5,498
Corporación Andina de Fomento		194		1,357		–			1,551		–		–		–			-
Others		7,831		2,376		(742	)		9,465		7,640		1,786		(396	)		9,030
		175,136		212,051		(9,360	)		377,827		187,388		327,913		(12,751	)		502,550
Balance before accrued interest		34,305,060		1,054,471		(999,021	)		34,360,510		40,676,355		2,751,867		(94,414	)		43,333,808
Accrued interest									397,933									410,081
Total									34,758,443									43,743,889

The Management of Credicorp has determined that the unrealized losses on investment at fair value through other comprehensive income as of December 31, 2021 and 2020 are of a temporary nature, considering factors such as intended strategy in relation with the identified security or portfolio, its underlying collateral and credit rating of the issuers. During 2021, as a result of assessment of the impairment of its investments at fair value through other comprehensive income, the Group recorded a credit loss provision of S/6.8 million (provision of credit loss of S/52.3 million during 2020), which is shown in “Net gain on securities”, see note 24, in the consolidated statement of income. Also, Management has decided and has the ability to hold each investment for a period of time sufficient to allow for an anticipated recovery in fair value, until the earlier of its anticipated recovery or maturity.

The movement of the “Reserve for investments at fair value through other comprehensive income” net of deferred income tax and non-controlling interest, is shown in Note 18(c).

It is worth mentioning the largest unrealized loss compared to the balance in 2020 is due to the political uncertainty of the country and to the downgrade of credit ratings of some bonds. See Note 2(c).

The maturities and annual market rates of investments at fair value through other comprehensive income during 2021 and 2020, are as follows:

	Maturities		Annual effective interest rate
	2021	2020		2021												2020
				S/				US$				Other				S/					US$				Other
				Min		Max		Min		Max		Min		Max		Min			Max		Min		Max		Min		Max
				%		%		%		%		%		%		%			%		%		%		%		%
Corporate bonds (*)	Jan-2022 / Nov-2095	Jan-2021 / Jul-2070			1.64		19.28		–		67.59		1.35		7.86		(0.31	)		16.21		0.01		10.51		0.78		6.25
Government treasury bonds	Jan-2022 / Feb-2055	Jan-2021 / Feb-2055			1.79		6.91		–		4.61		4.00		5.16		(1.20	)		5.08		0.03		4.61		0.07		0.41
Certificates of deposit BCRP	Jan-2022 / Mar-2023	Jan-2021 / Mar-2023			2.52		3.40		–		–		–		–		0.25			0.73		–		–		–		–
Negotiable certificates of deposits	Jan-2022 / Jul-2033	Jan-2021 / Jul-2033			3.88		3.88		2.48		2.68		1.00		6.02		–			–		2.48		4.57		0.05		5.90
Securitization instruments	Jan-2022 / Sep-2045	Jan-2021 / Sep-2045			4.05		28.90		2.17		10.85		3.50		–		1.32			13.36		1.51		9.19		–		6.00
Subordinated bonds (**)	Apr-2022 / Aug-2045	Apr-2022 / Aug-2045			0.28		7.48		0.86		7.62		–		–		(0.04	)		5.74		0.16		4.76		–		–
Others	Apr-2022 / Feb-2035	Jan-2021 / Feb-2035			1.77		7.99		3.39		5.05		0.05		0.05		(0.18	)		5.84		3.38		4.52		–		–

(*) As of December 31, 2020, the annual effective interest rate of (0.31) corresponds to a bond issued by the Danske Bank; excluding such interest rate, the rates tend to be positive..

(**) As of December 31, 2020, the annual effective interest rate of (0.04) percent corresponds to a bond issued by the Banco Interamericano de Finanzas S.A.; excluding such interest rate, the rates tend to be positive.

The negative rates correspond to bonds, whose nominal value is subject to a daily readjustment index for inflation determined by the BCRP. Said negative rates correspond to the market behavior.

As of December 31, 2021, the Group maintains IRS, which have been designated as fair value hedges of certain bonds at a fixed rate in US dollar, issued by corporate entities, classified as investments at fair value through other comprehensive income, for a notional amount of S/636.4 million (S/628.7 million as of December 31, 2020), see Note 13(c); through these IRS these bonds were economically converted to a variable rate.

Likewise, as of December 31, 2021, the Group entered into repurchase agreement transactions for government bonds and certificates of deposit BCRP classified as investments at fair value through other comprehensive income, for an estimated fair value of S/318.4 million (S/997.8 million as of December 31, 2020), of which the related liability is presented in “Payables from repurchase agreements and securities lending” of the consolidated statement of financial position, see Note 5(c).

(i) As of December 31, 2021, the balance corresponds to corporate bonds issued by companies from the United States, Peru, Chile and other countries, which represent 38.1 percent, 37.1 percent, 4.6 percent and 20.2 percent of the total, respectively, (issued by companies from Peru, the United States, Colombia and other countries, which represent 43.6 percent, 32.3 percent, 4.6 percent and 19.5 percent of the total, respectively, as of December 31, 2020).

As of December 31, 2021 the most significant individual unrealized loss amounted to approximately S/ 18.5 million (S/13.0 million as of December 31, 2020).

Likewise, as of December 31, 2021, the Group maintains CCS, which were designated as cash flow hedges of certain corporate bonds for a notional amount of S/ 79.1 million (S/81.8 million as of December 31, 2020), see Note 13(c); by means of said CCS, the bonds were economically converted to soles at a fixed rate.

The largest unrealized loss with respect to the balance of 2020 is due to the behavior of the market. As of December 31, 2021, the balance mainly includes S/18.5 million from the company Inversiones Nacionales de Turismo - Intursa S.A. (S/40.5 million of the Peruvian company Rutas de Lima S.A.C. as of December 31, 2020).

(ii)
As of December 31, 2021 and 2020, the balance includes the following Government Treasury Bonds:

	2021		2020
	S/(000)		S/(000)
Peruvian treasury bonds (*)		7,496,775		11,343,664
U.S. treasury and federal agency bonds		1,455,114		564,380
Bolivian treasury bonds		89,941		74,248
Colombian treasury bonds		87,428		101,741
Chilean treasury bonds		83,978		81,502
Others		25,163		39,514
Total		9,238,399		12,205,049

(*) The variation in the balance corresponds to sales of instruments and to the decrease in the fair value. The largest unrealized loss compared to the balance in 2020 is due to the political uncertainty of the country. See Note 2(c).

(iii) As of December 31, 2021, the Group maintains 80,541 certificates of deposits BCRP (153,760 as of December 31, 2020); which are instruments issued at discount through public auction, traded on the Peruvian secondary market and payable in soles. The decrease in the balance is mainly due to the maturity of these instruments.

(iv) As of December 31, 2021 and 2020, the balance of securitization instruments includes the following:

	2021		2020
	S/(000)		S/(000)
Inmuebles Panamericana S.A.		142,629		164,091
ATN S.A.		98,525		99,112
Colegios Peruanos S.A.		68,714		63,268
Costa de Sol S.A.		46,502		51,483
Nessus Hoteles Perú S.A.		38,547		40,050
Fábrica Nacional de Cemento S.A.		28,187		34,537
Concesionaria La Chira S.A.		27,370		32,138
Homecenters Peruanos S.A.		27,206		32,308
Industrias de Aceite S.A.		–		37,175
Others (less than S/28.2 million and S/30.5 million, respectively)		243,709		191,418
Total		721,389		745,580

The instruments have semiannual payments until 2045.The pool of underlying assets consists mainly of accounts receivable from income, revenues for services and from maintenance and marketing contributions (Inmuebles Panamericana S.A.), and accounts receivable for electrical transmission services from the Carhuamayo - Cajamarca line (ATN S.A.).

(v) As of December 31, 2021, the balance corresponds to certificates for US$0.67 million, equivalent to S/2.7 million, in soles currency for S/6.8 million; and in other currencies, equivalent to S/615.1 million issued mainly by the financial system of Colombia and Bolivia (US$6.65 million, equivalent to S/24.1 million; and in other currencies, equivalent to S/861.8 million, issued by the system of Colombia and Bolivia, as of December 31, 2020).

Likewise, as of December 31, 2021, the Group maintains CCS, which were designated as cash flow hedges of certain certificates for a notional amount of S/75.5 million (S/405.2 million, as of December 31, 2020), see Note 13(c); by means of said CCS, the certificates were economically converted to soles at a fixed rate.

c) Amortized cost investments consist of the following:

	2021
	Carrying		Fair
	amount		value
	S/(000)		S/(000)
Peruvian sovereign bonds (i)		7,438,364		7,169,787
Corporate bonds (i)		420,263		419,069
Subordinated bonds (i)		86,861		86,412
Certificates of payment on work progress (CRPAO) (ii)		74,499		19,310
Foreign government bonds (i)		74,122		73,645
Sub total		8,094,109		7,768,223
Accrued interest		171,450		171,450
Total		8,265,559		7,939,673

	2020
	Carrying		Fair
	amount		value
		S/(000)		S/(000)
Peruvian sovereign bonds (i)		4,739,588		5,438,925
Certificates of payment on work progress (CRPAO) (ii)		89,084		93,591
Foreign government bonds (i)		28,909		28,695
Sub total		4,857,581		5,561,211
Accrued interest		104,801		104,801
Total		4,962,382		5,666,012

The expected loss of investments at amortized cost as of December 31, 2021 and 2020 is S/2.8 million and S/0.7 million, respectively.

(i) As of December 31, 2021, said bonds have maturities between January 2022 and February 2042, accruing interest at an annual effective interest rate between 3.62 percent and 6.77 percent on bonds denominated in soles, between 0.71 percent and 4.50 percent on bonds denominated in US dollar, and between 0.00 percent and 2.96 percent annual on bonds issued in other currencies (as of December 31, 2020, have maturities between January 2021 and February 2042, accruing interest at an annual effective interest rate between 0.74 percent and 5.06 percent on bonds denominated in soles and between 0.00 percent and 3.05 percent on bonds issued in other currencies).

It is worth mentioning that the instruments with an interest rate of 0.00 percent corresponds to bonds issued by the Colombian Government, whose issue indicators on the date of acquisition were at very low levels; however, MiBanco Colombia invested in these instruments because it is a Colombian company that must invest in them according to local regulations, with the objective that the funds acquired by the Colombian Government are destined for the development and incentive of certain economic sectors.

Likewise, Credicorp Management has determined that as of December 31, 2021, the difference between amortized cost and the fair value of these investments is temporary in nature and Credicorp has the intention and ability to hold each of these investments until its maturity.

As of December 31, 2021, the Group has repurchase agreement transactions for investments at amortized cost for an estimated fair value of S/3,854.0 million (S/2,766.2 million as of December 31, 2020), the related liability for which is presented in the caption “Payables from repurchase agreements and securities lending” of the consolidated statement of financial position, see note 5(c).

(ii) As of December 31, 2021 there are 89 certificates of Annual Recognition of Payment on Work Progress - CRPAO from Spanish acronym (121 CRPAOs as of December 31, 2020), issued by the Peruvian Government to finance projects and concessions. Said issuance is a mechanism established in the concession agreement signed between the State and the concessionaire, which allows the latter to obtain financing to continue with the work undertaken. Said investment matures between January 2022 and April 2026, accruing interest at an annual effective rate between 2.32 percent and 4.26 percent (between January 2021 and April 2026, accruing interest at an annual effective rate between 2.42 percent and 3.47 percent as of December 31, 2020).

d) The table below shows the balance of investments classified by maturity, without consider accrued interest or provision for credit loss:

	2021
	At fair value through profit or loss		At fair value through other comprehensive income		Amortized cost
	S/(000)		S/(000)		S/(000)
Up to 3 months		1,172,834		8,117,458		78,311
From 3 months to 1 year		209,172		3,683,466		296,699
From 1 to 3 years		746,115		4,804,229		1,641,340
From 3 to 5 years		136,444		4,111,276		459,363
More than 5 years		1,020,840		13,266,254		5,618,396
Without maturity		2,633,794		377,828		–
Total		5,919,199		34,360,511		8,094,109

	2020
	At fair value through profit or loss		At fair value through other comprehensive income		Amortized cost
		S/(000)		S/(000)		S/(000)
Up to 3 months		1,973,038		14,564,360		11,518
From 3 months to 1 year		94,554		2,606,845		42,397
From 1 to 3 years		462,168		4,272,547		163,120
From 3 to 5 years		486,310		3,770,438		631,740
More than 5 years		1,290,057		17,617,068		4,008,806
Without maturity		2,147,970		502,550		–
Total		6,454,097		43,333,808		4,857,581