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In theory, if you purchased stock with a price to book value less than 1 and the company immediately went bankrupt, you would gain money on your investment.

Not that Bladex is going bankrupt........ though they are trading .842 below book value.

FYI:

Bladex Book value (period average) on 6/30/18 is $26.34 ...up from $25.95 a year ago on 6/30/17 though down a smidgen from $26.45 on 3/31/18

Bladex just hit a 52 week low of 21.82 this morning making the dividend 6.87%. ;^)

Just sayin'.

Bladex 2Q report 2018 Date: 7/20/2018 8:49 AM

Bladex Announces Profit For The Second Quarter 2018 Of $16.6 Million, Or $0.42 Per Share, And Year-To-Date 2018 Of $31.1 Million, Or $0.79 Per Share

2Q18 & 6M18 Highlights
Profit for the 2Q18 increased 15% QoQ to $16.6 million........

These numbers are complicated, intricately balanced, and unwieldy for me as BLX tries to explain Net Interest Income , Net Interest Margin , Efficiency Ratio and other levers that banks can pull to 'splain earnings.

The statement from the CEO is much clearer to me:

Mr. N. Gabriel Tolchinsky, Bladex's Chief Executive Officer, said, "Our second quarter results improved relative to the first quarter, with positive performance trends such as higher loan balances and fee-related income, as well as lower operating expenses.

However, a more challenging environment is developing, particularly in the region's three largest economies – Brazil, Mexico and Argentina. During the past several weeks we saw
diminishing expectations for economic growth in Brazil due to the truckers' strike,
Argentina's currency depreciating by more than 30% and
Mexico's election of a populist candidate.

These challenges were exacerbated by more protectionist measures out of Washington with potential negative impact on trade and on the region's economic growth. This environment, if it persists, may influence our perception of credit risk for our performing loan portfolio as well as recoveries for problem loans."

Mr. Tolchinsky stated that "during the first half of 2Q2018, credit spreads didn't reflect incremental risk and continued to be influenced by high US dollar liquidity in the region.
In the second half of the quarter however, we experienced higher margins. In the coming quarters we will continue to extend the average tenor of our short-term originations and increase medium-term loan originations for good credit quality borrowers. At the same time, from an operational perspective, we will continue to focus on reducing costs and increasing productivity and efficiency."
http://www.bladex.com/sites/default/files/financial-reports/......

Book value (period average) on 6/30/18 is $26.34 ...up from $25.95 a year ago on 6/30/17 though down a smidgen from $26.45 on 3/31/18
Book value (period end) on 6/30/18 is $26.42 ..... up from $26.02 a year ago on 6/30/17 though down from a more recent 3/31/18 value of $26.47.

The stock price is at 24.19 this morning so it is trading under book value and the dividend is maintained.

Seeking alpha notes:

Banco Latinoamericano misses by $0.13, misses on revenue
https://seekingalpha.com/symbol/BLX/earnings

The last time that BLX beat estimates was 4/4/16.

Not much down side risk here, eh. ;^)

Fool ommmm , kevin c
your Foolish neighborhood BLX ticker guide
long of BLX
please click my screen name for disclosed holdings
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No. of Recommendations: 1
To be fair, the book value of a bank is not backed up by hard assets like property. Rather, it's supported by $5.5b worth of loans outstanding, which could easily be impaired due to the financial stress in the regions where Bladex operates. Now, those loans are ostensibly backed by some kind of collateral, but in a deteriorating situation, you wouldn't expect the value of that collateral to match the value of the loan 1:1.

This is just to say that I agree Bladex is attractive (7% yield too!), but don't underestimate the potential for near-term downside.

Tim
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