GOODWILL AND INTANGIBLE ASSETS, NET (Tables)

12 Months Ended

Dec. 31, 2022

GOODWILL AND INTANGIBLE ASSETS, NET

Schedule of intangible assets and goodwill, net

	December 31, 2022	December 31, 2021
In millions of COP
Intangible assets	602,531	485,626
Goodwill(1)	9,836,661	8,143,146
Total	10,439,192	8,628,772

(1) For December 2021, included the goodwill recognized for the acquisition of Wompi S.A.S (before Vlipco S.A.S). See Note 9.3 Business combination.

Schedule of intangible assets

The following table sets forth the Bank’s intangible assets as of December 31, 2022 and 2021, including the reconciliation of initial and final balances of the cost and accrued amortization:

As of December 31, 2022

		Licenses, software
Cost	Trademarks	and computer	Client	Total
		applications	relationships
In millions of COP
Balance at January 1, 2022	23,537	997,609	458,980	1,480,126
Acquisitions	-	245,204	-	245,204
Write off	-	(43,991)	-	(43,991)
Transfers from premises and equipment	-	30,068	-	30,068
Foreign currency translation adjustment	4,901	132,368	95,578	232,847
Balance at December 31, 2022	28,438	1,361,258	554,558	1,944,254

		Licenses, software
Amortization	Trademarks	and computer	Client	Total
		applications	relationships
In millions of COP
Balance at January 1, 2022	20,174	523,055	451,271	994,500
Write off	-	(41,148)	-	(41,148)
Amortization expense(1)	3,595	170,004	2,392	175,991
Transfers from premises and equipment	-	28,940	-	28,940
Foreign currency translation adjustment	4,668	84,488	94,284	183,440
Balance at December 31, 2022	28,437	765,339	547,947	1,341,723
Intangible assets at December 31, 2022, net	1	595,919	6,611	602,531

(1) See Note 26.3 Impairment, depreciation and amortization.

As of December 31, 2021

		Licenses, software
Cost	Trademarks	and computer	Client	Total
		applications	relationships
In millions of COP
Balance at January 1, 2021	20,293	823,318	395,726	1,239,337
Acquisitions	-	144,514	-	144,514
Acquisitions through business combination(1)	-	13,196	-	13,196
Write off	-	(49,805)	-	(49,805)
Foreign currency translation adjustment	3,244	66,386	63,254	132,884
Balance at December 31, 2021	23,537	997,609	458,980	1,480,126

(1) See Note 9.3 Business Combination.

		Licenses, software
Amortization	Trademarks	and computer	Client	Total
		applications	relationships
In millions of COP
Balance at January 1, 2021	14,495	398,521	330,715	743,731
Write off	-	(49,805)	-	(49,805)
Amortization expense(1)	3,165	131,288	63,716	198,169
Foreign currency translation adjustment	2,514	43,051	56,840	102,405
Balance at December 31, 2021	20,174	523,055	451,271	994,500
Intangible assets at December 31, 2021, net	3,363	474,554	7,709	485,626

(1) See Note 26.3 Impairment, depreciation and amortization.

Schedule of reconciliation of changes in goodwill

The following table sets forth an analysis of the activity in the goodwill account:

	December 31, 2022	December 31, 2021
In millions of COP
Balance at beginning of the year, net	8,143,146	7,011,715
Acquisitions(1)	-	10,660
Effect of change in foreign exchange rate(2)	1,693,515	1,120,771
Balance at end of the year, net	9,836,661	8,143,146

(1) For 2021, corresponds to the goodwill recognized for the acquisition of Wompi S.A.S. (before Vlipco S.A.S.). See Note 9.3 Business combination

(2) The conversion rate from US dollars to Colombian pesos at the end of December 31, 2022 is COP 4,810.20 (in pesos) and 2021 is COP 3,981.16 (in pesos). See Note 2.D.3. Foreign subsidiaries

Summary of key assumptions used by management in determining the recoverable amount

The key assumptions used by management in determining the recoverable amount are:

				Discount Rate	(1)	Growth rate	(2)
Operating segment	Goodwill 2022	Valuation Methodology	Key Assumptions	(real)		(real)
In millions of COP
Banking Panama	7,346,484	Discounted Cash flow	5 years plan	10.90	%	5.30	%
Banking				20.10	%	3.90	%
El Salvador	1,356,837	Discounted Cash flow	5 years plan	and 16.10	%(3)
Banking Guatemala	1,122,680	Discounted Cash flow	5 years plan	13.00	%	4.90	%
			Multiples EV/ Revenue			Does not
Others Segments	10,660	Comparable multiples	and EV/EBITDA	38.08	%	apply

(1) The discount rate is the return that would be expected for an investment that generates cash flows similar to those that are expected to be obtained from the use of the CGU. CAPM methodology was used as a basis to determine this rate.

(2) This rate is equivalent to the nominal or real growth of the economy in Guatemala, Panama and El Salvador, which is considered an important driver for the growth of the banking industry.

(3) Corresponds to the discount rate used for the short and long term, respectively.

Schedule of estimated recoverable amount of each operating segment obtained as a result of sensitivity analysis

As of December 31, 2022

Banking Panama

	+50 bips		Discount rate		-50 bips
Growth rate		11.40%		10.90%		10.40%
5.30%		12,851,974		14,049,526		15,483,841
	-50 bips		Growth rate		+50 bips
Discount rate		4.80%		5.30%		5.80%
10.90%		13,351,970		14,049,526		14,883,860

Banking El Salvador

	+100 bips		Discount rate		-100 bips
		21.10%		20.10%		19.10%
Growth rate		17.10%		16.10%		15.10%
3.90%		4,543,466		4,913,975		5,351,507
	-50 bips		Growth rate		+50 bips
Discount rate		3.40%		3.90%		4.40%
20.10% and 16.10%		4,851,416		4,913,975		4,981,886

Banking Guatemala

	+50 bips		Discount rate		-50 bips
Growth rate		13.50%		13.00%		12.50%
4.90%		4,854,108		5,225,546		5,647,675
	-50 bips		Growth rate		+50 bips
Discount rate		4.40%		4.90%		5.40%
13.00%		5,070,100		5,225,546		5,401,451

As of December 31, 2021

Banking Panama

	+50 bips		Discount rate		-50 bips
		9.30%		8.80%		8.30%
Growth rate		9.20%		8.70%		8.20%
5.40%		10,929,065		12,664,169		15,019,623
	-50 bips		Growth rate		+50 bips
Discount rate		4.90%		5.40%		5.90%
8.80% and 8.70%		11,550,846		12,664,169		14,175,111

Banking El Salvador

	+100 bips		Discount rate		-100 bips
Growth rate		15.90%		14.90%		13.90%
4.10%		4,611,843		5,041,507		5,559,874
	-50 bips		Growth rate		+50 bips
Discount rate		3.60%		4.10%		4.60%
14.90%		4,948,901		5,041,507		5,143,103

Banking Guatemala

	+50 bips		Discount rate		-50 bips
Growth rate		10.60%		10.10%		9.60%
5.10%		5,514,165		6,156,028		6,942,610
	-50 bips		Growth rate		+50 bips
Discount rate		4.60%		5.10%		5.60%
10.10%		5,807,354		6,156,028		6,582,183

PA FAI Calle 77 acquisition

GOODWILL AND INTANGIBLE ASSETS, NET

Schedule of the estimated fair value of assets acquired and liabilities assumed

The estimate of the fair value of the assets acquired and liabilities assumed was based on information available as of March 1, 2022. The Bank believes that this information provides a reasonable basis for determining fair values:

	In millions of COP
Purchase Price Allocation
Pruchase price on June 9, 2021	56,968
Non-controlling interest at fair value	1,166
TOTAL	58,134
Fair value of net assets acquired
ASSETS
Cash and cash equivalents	799
Accounts receivable	299
Premises and equipment, net	3
Investments property	60,849
Other assets	79
Total Assets	62,029
LIABILITIES
Accounts payable	1,080
Deferred tax	283
Other liabilities	99
Total Liabilities	1,462
Fair value of net assets acquired	60,567
Gain from a bargain purchase	2,433

Wompi S.A.S. (Before Vlipco S.A.S.)

GOODWILL AND INTANGIBLE ASSETS, NET

Schedule of the estimated fair value of assets acquired and liabilities assumed

For this acquisition, the estimated fair value of assets acquired and liabilities assumed are based on the information available at November 30, 2021. The Bank believes that this information provides a reasonable basis for determining fair values.

	In millions of COP
Wompi S.A.S Purchase Price Allocation
Pruchase price on November 30, 2021	9,474
Fair value of previously held invesment	9,479
Non-controlling interest at fair value	1,047
TOTAL	20,000
Book value of net assets acquired
ASSETS
Cash and cash equivalents	296
Accounts receivable	241
Taxes receivable	433
Premises and equipment, net	22
Other assets	32
Total Assets	1,024
LIABILITIES
Short-term borrowings	37
Accounts payable	45
Taxes liabilities	78
Employee benefit plans	106
Total Liabilities	266
Net assets at book value	758
Wompi S.A.S intangibles assets recognized at the acquisition date:
Software(1)	13,196
Deferred tax	(4,614)
Fair value of net assets acquired	9,340
Goodwill	10,660

(1) The fair value of the intangible assets includes a software development that supports the operation of the Wompi S.A.S. payment gateway, with a fair value of COP 13,196.

Summary of previously held interest in business combination

Date and nature of investment	Share in equity
Investment recorded as an joint venture(1)	47.40	%
November 2021 – acquisition of 47.37%, control obtained	47.37	%
Total at December 31, 2021	94.77	%

(1) Investment made since July 2019, the participation percentage was 48.91% at initial recognition.