UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 OF THE

SECURITIES EXCHANGE ACT OF 1934

February 10, 2022

Commission File Number 001-38965

INTERCORP FINANCIAL SERVICES INC.

(Registrant’s name)

Intercorp Financial Services Inc.

Torre Interbank, Av. Carlos Villarán 140

La Victoria

Lima 13, Peru

(51) (1) 615-9011

(Address of 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  ☒ 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):  ☐

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):  ☐

On February 10, 2022, Intercorp Financial Services Inc. (“IFS”) announced its unaudited results for the fourth quarter of 2021, which were approved by the Board on February 10, 2022. IFS’ condensed consolidated unaudited results as of December 31, 2021 and December 31, 2020, and the corresponding Management Discussion and Analysis are attached hereto.

EXHIBIT INDEX

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.

Intercorp Financial Services Inc.

Fourth Quarter 2021 Earnings

Lima, Peru, February 10, 2022. Intercorp Financial Services Inc. (Lima Stock Exchange/NYSE: IFS) announced today its unaudited results for the fourth quarter 2021. These results are reported on a consolidated basis under IFRS in nominal Peruvian soles.

Intercorp Financial Services: Record earnings of S/ 1,800 million in 2021, IFS’ ROAE at 19.3%

Interbank: Profitability recovers on higher revenues and lower provisions, FY21 ROAE at 21.0% and 4Q21 at 27.8%

Interseguro: Strong full-year results, FY21 ROAE at 28.2%

Inteligo: FY21 profits grew 16.6% with FY21 ROAE at 23.0%

1

Intercorp Financial Services

SUMMARY

2021 Performance

Intercorp Financial Services’ profits were S/ 1,800.2 million in 2021, an increase of more than four-fold compared to 2020. The recovery in net profit was mainly driven by a significant decrease of 84.1% in impairment loss on loans and growth of 16.6% in other income, 13.9% in net fee income from financial services, and 2.2% in net interest and similar income. These factors were partially offset by 18.4% higher other expenses, weakened translation result and resumed income tax payment.

It is worth mentioning that IFS’ results in 2021 were favored by (i) the reversion of loan loss provisions due to refined calculations of the expert criteria in our banking segment for S/ 297.2 million, or S/ 209.5 million after taxes in 4Q21, and (ii) extraordinary investment income for S/ 87.1 million in our insurance segment in 1Q21.

IFS’s ROAE was 19.3% in 2021, well above the 4.5% registered in 2020. Excluding the previously mentioned one-off impacts of the reversion of loan loss provisions due to refined calculations of the expert criteria in our banking segment in 4Q21 and the extraordinary investment income in our insurance segment in 1Q21, ROAE would have resulted in 16.3% in 2021.

Intercorp Financial Services’ P&L statement

Net interest and similar income grew due to a higher return of the fixed income portfolio at Interseguro and lower interest and similar expenses at Inteligo. These effects were partially offset by a slight reduction in net interest and similar income at Interbank.

Impairment loss on loans, net of recoveries decreased 84.1% in 2021 compared to the previous year. The reduction in provision expenses was mainly explained by (i) the reversion of loan loss provisions due to refined calculations of the expert criteria in our banking segment for S/ 297.2 million in the last quarter of 2021, and (ii) a base effect when comparing to the situation in 2020, when the bank adjusted its expected loss models to address the impact of the COVID-19 pandemic. These factors were partially offset by higher provision requirements in the commercial portfolio, mainly referred to loan exposures to small-sized and medium-sized companies at Interbank.

2

Growth in net fee income from financial services was mainly due to higher commissions across most products and services at Interbank and higher fees at Inteligo. It is worth to mention that to the fee income line favored from a base effect when compared to the level of fees in 2020, when most of the business activities in Peru were affected by mobility restrictions.

Other income grew as a result of positive performances across all three subsidiaries, mainly supported by net gain of foreign exchange transactions and on financial assets at fair value through profit or loss at Interbank. In addition, higher net gain on sale of securities, rental income and net gain on valuation of real estate investments at Interseguro, and positive mark-to-market valuation on investments in the full year at Inteligo also contributed to the positive result in other income.

Total premiums earned less claims and benefits were S/ -272.0 million in 2021, compared to S/ -279.1 million reported in 2020. The annual performance was due to S/ 424.8 million growth in net premiums, partially offset by increases of S/ 294.5 million in adjustment of technical reserves and S/ 123.2 million in net claims and benefits incurred.

The increase in other expenses was mostly attributed to higher administrative expenses, as well as higher salaries and employee benefits across all three subsidiaries. On one hand, growth in administrative expenses was mainly related to marketing and credit card expenses, and IT services at Interbank. On the other hand, growth in salaries and employee benefits was associated to higher employee profit sharing at Interbank, in addition to promotions and recruitment of new employees, together with the effect of a higher foreign exchange rate in the cost base at Inteligo. It is worth mentioning that investments in digital ventures at IFS’ platform have also had a significant weight in the increase of total other expenses in 2021.

The efficiency ratio was 34.7% in 2021, compared to the 32.2% registered in 2020.

Intercorp Financial Services’ Statement of financial position

4Q21 Performance

Intercorp Financial Services’ net profit was S/ 264.4 million in 4Q21, a reduction of S/ 287.1 million QoQ, or 52.1%, and S/ 113.0 million YoY, or 30.0%.

IFS’s annualized ROAE was 10.9% in 4Q21, below the 23.1% and 17.5% registered in 3Q21 and 4Q20, respectively.

3

As mentioned before, IFS’ results in 4Q21 were favored by (i) the reversion of loan loss provisions due to refined calculations of the expert criteria in our banking segment for S/ 297.2 million, or S/ 209.5 million after taxes.

Intercorp Financial Services’ P&L statement

Quarter-on-quarter performance

Profits decreased 52.1% QoQ mainly due to lower other income at Inteligo, Interseguro and at the holding company level, in addition to an increase in other expenses across all three subsidiaries. Moreover, a higher effective tax rate at Interbank also weighed down on earnings. These factors were partially compensated by a reversion of impairment loss on loans at Interbank and higher net interest and similar income at Interbank and Inteligo. Additionally, growth in net fee income at Interbank and an improvement in total premiums earned minus claims and benefits at Interseguro also contributed to offset the reduction in earnings.

Net interest and similar income increased S/ 46.3 million QoQ, or 5.2%, mainly explained by higher yields on all interest-earnings assets at Interbank and incremental dividends received from investments during the quarter and interest income from regular loans at Inteligo. These effects were partially offset by lower interest and similar income at Interseguro, mostly attributed to a lower inflation rate that had a negative impact on returns of the fixed income portfolio.

Impairment loss on loans, net of recoveries reversed in 4Q21 due to (i) refined calculations of the expert criteria worth S/ 297.2 million at Interbank, and (ii) improved payment behavior among Interbank’s retail clients. Furthermore, Interseguro reported a positive performance in results due to impairment of financial investments, mostly related to an additional provision for impairment on a fixed income investment in 3Q21, which was not repeated in 4Q21.

Net fee income from financial services increased S/ 23.8 million QoQ, or 12.0%, mainly explained by higher commissions across most products and services at Interbank. These factors were partially offset by lower fees from indirect loans at Interbank and the effect of a sequentially lower foreign exchange rate on Inteligo’s dollar-denominated fee base.

Other income decreased S/ 504.3 million QoQ, mainly attributable to negative mark-to-market valuations and unrealized losses on Inteligo’s proprietary portfolio, in addition to a lower valuation gain from investment property at Interseguro. These effects were partially compensated by growth in net gain on sale of financial investments at Interseguro and a small increase in other income at Interbank.

4

Total premiums earned minus claims and benefits at Interseguro were S/ -20.5 million in the quarter. This resulted from a S/ 93.8 million increase in net premiums, in addition to a S/ 16.3 million reduction in net claims and benefits incurred, partially offset by an increase of S/ 42.7 million in adjustment of technical reserves.

Other expenses increased S/ 53.8 million QoQ, or 9.2%, mainly attributed to higher depreciation and amortization charges at Interbank, and administrative expenses at Interseguro and Inteligo as a result of increased operational activity.

IFS’ effective tax rate increased, from 17.2% in 3Q21 to 42.3% in 4Q21, as a result of a higher effective tax rate at Interbank and a lower contribution to profits from Inteligo.

Year-on-year performance

Profits decreased 30.0% YoY mainly due to lower other income at Inteligo and Interseguro, and higher other expenses across all three subsidiaries. These factors were partially compensated by a reversion of impairment loss on loans at Interbank as well as an improvement in total premiums earned minus claims and benefits at Interseguro. Moreover, increases in net fee income at Interbank and Inteligo, and in net interest and similar income at Interbank and Interseguro also contributed to compensate the reduction in earnings.

Net interest and similar income grew S/ 25.6 million YoY, or 2.8%, mainly due to higher interest on loans, and on due from banks and inter-bank funds at Interbank, in addition to an increase in interest and similar income at Interseguro, mostly attributed to a higher return of the fixed income portfolio. These effects were partially offset by lower interest income from Inteligo’s investment portfolio.

Impairment loss on loans, net of recoveries reversed in 4Q21 due to (i) refined calculations of the expert criteria worth S/ 297.2 million at Interbank, and (ii) improved payment behavior among Interbank’s retail clients. Additionally, Interseguro reported a recovery due to impairment of financial investments in 4Q20, mostly related to a reversion of provision for impairment on a fixed income investment in such quarter, which was not repeated in 4Q21.

Net fee income from financial services increased S/ 37.0 million YoY, or 19.9%, mainly due to higher commissions across most products and services at Interbank. Furthermore, Inteligo reported higher fund management fees and brokerage fees due to increased trading volumes, triggered by higher price volatility and client appetite for investing or rebalancing portfolios.

Other income declined S/ 409.5 million YoY, mainly attributable to negative mark-to-market valuations and unrealized losses on Inteligo’s proprietary portfolio, in addition to decreases in net gain on financial assets at fair value and in valuation gain from investment property at Interseguro. These effects were partially compensated by increases in net gain on sale of financial investments and rental income at Interseguro, and in net gain on foreign exchange transactions and on financial assets at fair value through profit or loss at Interbank.

On a yearly basis, total premiums earned minus claims and benefits at Interseguro improved S/ 69.2 million, explained by S/ 170.3 million growth in net premiums, partially offset by increases of S/ 98.0 million in adjustment of technical reserves and S/ 3.1 million in net claims and benefits incurred.

Other expenses grew S/ 102.6 million YoY, or 19.1%, as the result of (i) higher administrative expenses across all three subsidiaries, (ii) higher depreciation and amortization charges at Interbank an Inteligo and (iii) an increase in salaries and employee benefits at Interseguro. It is worth mentioning that investments in digital ventures have also had a significant weight in the increase of total other expenses, as well as the base effects after cost containment measures that were implemented across all subsidiaries during 2020 to deal with the COVID-19 pandemic.

IFS’ effective tax rate increased, from 16.8% in 4Q20 to 42.3% in 4Q21, as a result of a higher effective tax rate at Interbank and a lower contribution to profits from Inteligo and Interseguro.

5

CONTRIBUTION BY SEGMENTS

The following table shows the contribution of Interbank, Interseguro and Inteligo to Intercorp Financial Services’ net profit. The performance of each of the three segments is discussed in detail in the following sections.

Intercorp Financial Services’ Profit by segment

6

Interbank

SUMMARY

2021 Performance

Interbank’s net profit reached S/ 1,360.3 million in 2021, compared to almost break-even results in the previous year.

The yearly performance was mainly attributed to a S/ 2,014.9 million reduction in impairment loss on loans and increases of S/ 108.4 million in other income and S/ 57.7 million in net fee income from financial services. These factors were partially offset by resumed income tax payments and S/ 254.4 million higher other expenses, in addition to a decrease of S/ 39.4 million in net interest and similar income.

It is worth mentioning that Interbank’s results in 2021 were favored by the reversion of loan loss provisions due to refined calculations of the expert criteria for S/ 297.2 million, or S/ 209.5 million after taxes in 4Q21.

Interbank’s ROAE was 21.0% in 2021, representing a clear improvement in profitability compared to the situation in 2020. Excluding the one-off impact of the reversion of loan loss provisions due to refined calculations of the expert criteria, ROAE would have resulted in 17.9% in 2021.

Banking Segment’s P&L Statement

Net interest and similar slightly decreased 1.4%, as a 5.2% decline in interest and similar income was almost completely compensated by a 15.2% reduction in interest and similar expense.

The lower interest and similar income was due to a 6.7% contraction in interest on loans, partially offset by increases of 45.5% in interest on due from banks and inter-bank funds, and 11.6% in interest on financial investments.

Interest on loans decreased S/ 239.8 million, or 6.7%, due to a 110 basis point reduction in the average rate, partially offset by a 6.5% higher average volume.

The lower average rate on loans, from 9.0% in 2020 to 7.9% in 2021, was due to yield reductions in all client segments. In retail loans rates decreased on other consumer loans and mortgages. In the commercial portfolio, rates decreased on all types of loans. It is worth mentioning that the incidence of the low-return loans offered to several commercial clients as part of the Reactiva Peru Program had an impact on the average rate on loans.

7

The higher average volume of loans was attributed to growth of 12.3% in commercial loans and 0.8% in retail loans. In the commercial portfolio, the higher average volume was mainly due to a 14.3% increase in short and medium-term loans, attributed to the extension of loans under the Reactiva Peru Program, as well as 10.4% growth in trade finance loans. In the retail portfolio, average volumes grew due to a 10.9% increase in mortgages, partially offset by a 5.2% contraction in the average balance of consumer loans.

Interest on due from banks and inter-bank funds increased S/ 12.5 million, or 45.5%, explained by 23.8% growth in the average volume and a relatively stable nominal average rate. The increase in the average volume was explained by higher deposits at the Central Bank, partially offset by a lower average balance of inter-bank funding and reserve funds.

Interest on financial investments increased S/ 27.8 million, or 11.6%, due to 31.2% growth in the average volume, partially offset by a 50 basis point reduction in the average yield. The increase in the average volume was mainly the result of higher average balances of sovereign bonds, Central Bank Certificates of Deposits (CDBCR) and global bonds. The decrease in the nominal average rate, from 3.3% in 2020 to 2.8% in 2021, was mainly explained by lower returns on all types of securities, especially CDBCR and corporate bonds from financial institutions.

As a result of the above, the nominal average yield on interest-earning assets decreased a full percentage point, from 6.3% in 2020 to 5.3% in 2021.

The 15.2% lower interest and similar expense was due to reductions of 31.0% in interest on deposits and obligations, and 13.9% in interest on due to banks and correspondents, partially offset by an 8.7% increase in interest on bonds, notes and other obligations.

Interest on deposits and obligations decreased S/ 166.2 million, or 31.0%, explained by a 50 basis point reduction in the average cost, from 1.3% in 2020 to 0.8% in 2021, partially offset by 14.4% growth in the average volume. The lower average cost was due to reductions in rates paid to institutional, retail and commercial deposits. Growth in volumes came across all client segments. By currency, average balances of soles-denominated deposits increased 11.1% while average dollar-denominated deposits grew 21.4%.

Interest on due to banks and correspondents decreased as a result of a 70 basis point reduction in the average cost, from 2.4% in 2020 to 1.7% in 2021, partially compensated by 18.5% growth in the average volume. On one hand, the reduction in the average cost was explained by lower rates paid to all types of funding, especially that provided by correspondent banks abroad and inter-bank funds. On the other hand, the increase in the average volume was due to higher funding provided by the Central Bank and COFIDE.

The higher interest on bonds, notes and other obligations was explained by 10.5% growth in the average volume, mainly attributable to a 10.6% depreciation of the average foreign exchange rate with respect to 2020.

The average cost of funding decreased 50 basis points, from 2.0% in 2020 to 1.5% in 2021, in line with the lower implicit cost of all interest-bearing liabilities.

As a result of the above, net interest margin was 4.0% in 2021, 60 basis points lower than the 4.6% reported in 2020.

Impairment loss on loans, net of recoveries decreased S/ 2,014.9 million, or 84.2%, compared to the previous year. The reduction in provision expenses was mainly related to (i) the reversion of loan loss provisions due to refined calculations of the expert criteria for S/ 297.2 million in the last quarter of 2021, and (ii) a base effect when comparing to the situation in 2020, when the bank adjusted its expected loss models to address the impact of the COVID-19 pandemic. These factors were partially offset by higher provision requirements in the commercial portfolio, mainly referred to loan exposures to small-sized and medium-sized companies.

The S/ 57.7 million, or 9.3%, increase in net fee income from financial services was mainly due to higher commissions across most products and services, again attributed to a base effect when compared to the level of fees in 2020, when most of the business activities in Peru were affected by mobility restrictions.

Other income grew S/ 108.4 million, or 24.4%, mainly due to an increase in net gain of foreign exchange transactions and on financial assets at fair value through profit or loss, in turn associated with a higher currency volatility.

Other expenses increased S/ 254.4 million, or 16.6%, mainly as a result of higher administrative expenses, as well as higher salaries and employee benefits. On one hand, growth in administrative expenses was mainly related to higher marketing and credit card expenses, and IT services. On the other hand, salaries and employee benefits grew due to higher employee profit sharing. It is worth mentioning that investments in digital ventures have also had a significant weight in the increase of total other expenses.

8

The efficiency ratio was 42.7% in 2021, compared to the 38.6% registered in 2020.

Results before translation result and income tax were S/ 1,806.2 million in 2021, representing a clear improvement compared to the result registered in 2020. This improvement was partially offset by resumed income tax payments.

As a result of the above, profits for the period were S/ 1,360.3 million compared to net results of S/ -5.7 million in 2020. Excluding the one-off impact of the reversion of loan loss provisions due to refined calculations of the expert criteria, Interbank’s profits would have reached S/ 1,150.8 million in 2021.

4Q21 Performance

Interbank’s profits were S/ 467.1 million in 4Q21, an increase of S/ 168.0 million QoQ, or 56.1%, and S/ 273.3 million YoY, or more than two-fold. The quarterly result was mainly attributed to a reversion of impairment loss on loans, as well as increases of S/ 64.5 million in net interest and similar income, and S/ 22.1 million in net fee income from financial services. These factors were partially offset by an increase of S/ 27.6 million in other expenses, as well as a higher effective tax rate and a negative performance in translation result.

The annual performance in net profit was also explained by the reversion of impairment loss on loans and by increases of S/ 24.9 million in net fee income from financial services, S/ 18.3 million in net interest and similar income, and S/ 7.2 million in other income. These effects were partially compensated by higher other expenses of S/ 81.9 million, in addition to a higher effective tax rate and a negative performance in translation result.

As mentioned before, Interbank’s results were favored by the reversion of loan loss provisions due to refined calculations of the expert criteria for S/ 297.2 million, or S/ 209.5 million after taxes in 4Q21.

Interbank’s ROAE was 27.8% in 4Q21, above the 18.6% and 12.8% registered in 3Q21 and 4Q20, respectively. Excluding the one-off impact of the reversion of loan loss provisions due to refined calculations of the expert criteria, ROAE would have resulted in 15.5% in 4Q21.

Banking Segment’s P&L Statement

INTEREST-EARNING ASSETS

Interbank’s interest-earning assets reached S/ 65,790.4 million as of December 31, 2021, a 1.4% reduction QoQ but a 0.4% increase YoY.

9

The quarterly decrease in interest-earning assets was attributed to a reduction of 17.3% in cash and due from banks and inter-bank funds, partially offset by increases of 7.8% in financial investments and 3.3% in loans. The decrease in cash and due from banks and inter-bank funds was mainly due to lower deposits at the Central Bank, partially compensated by higher reserve funds at the same institution. The increase in financial investments was mainly a result of higher balances of sovereign bonds, partially offset by lower balances of global bonds.

The YoY increase in interest-earning assets was attributed to growth of 12.2% in financial investments and 6.3% in loans. These effects were partially compensated by a reduction of 18.6% in cash and due from banks and inter-bank funds. The increase in financial investments resulted from higher volumes of sovereign bonds, Central Bank Certificates of Deposits (CDBCR) and corporate bonds, while the decrease in cash and due from banks and inter-bank funds resulted mainly from lower deposits at the Central Bank.

Interest-earning assets

Loan portfolio

The evolution of performing loans was affected by the disbursement and maturity or prepayment of commercial loans under the Reactiva Peru Program. As of December 31, 2021, these performing loans amounted S/ 4,459.0 million, compared to balances of S/ 5,249.0 million as of September 30, 2021 and S/ 6,616.5 million as of December 31, 2020.

Also, it is worth mentioning that in November 2019, the SBS issued the Resolution No. 5570-2019 that became effective in January 2021. This resolution establishes that the reporting of the non-revolving financing part of credit cards loans must be presented as loans instead of credit card loans.

Performing loans increased 2.3% QoQ, as retail loans sequentially grew 5.1%, while commercial loans slightly decreased 0.3%. Excluding the effect of the Reactiva Peru Program in the comparing periods, performing loans and commercial loans would have increased 4.9% and 4.6% QoQ, respectively.

Retail loans grew 5.1% QoQ due to increases of 7.4% in consumer loans and 1.9% in mortgages. Growth in consumer loans resulted from higher balances of cash loans, vehicle loans and credit cards, while payroll deduction loans slowed down 1.5%. The increase in mortgages was explained by higher demand in both traditional and MiVivienda products.

The reduction in commercial loans was a result of lower short and medium-term lending, as well as lower leasing operations, both across all business segments. These effects were compensated by higher trade finance loans mainly in the corporate and mid-sized segments.

10

Performing loans grew 3.7% YoY explained by a 13.6% increase in retail loans, partially offset by a 4.3% reduction in commercial loans. Excluding the effect of the Reactiva Peru Program in the comparing periods, performing loans and commercial loans would have increased 11.0% and 7.9% YoY, respectively.

The YoY growth in retail loans was due to increases of 14.9% in consumer loans and 11.7% in mortgages. The increase in consumer loans resulted from higher credit cards and payroll deduction loans, among others. Growth in mortgages was due to higher demand in both traditional and MiVivienda products.

The annual reduction in commercial loans was mainly explained by lower short and medium-term lending, as well as lower leasing operations; both effects across all business segments. These factors were partially offset by higher trade finance loans across all business segments.

It is worth mentioning that, as of December 31, 2021, and in line with the measures implemented to help our customers to overcome the impacts from the COVID-19 pandemic, 262 thousand clients still had their loans rescheduled, out of which approximately 252 thousand were retail clients and around 10 thousand, commercial clients. Loans that were subject to some kind of rescheduling represented S/ 6.3 billion or 14.6% of our total portfolio. Of these, S/ 4.5 billion were retail loans (21.4% of total retail loans), and the remaining S/ 1.8 billion were commercial loans (8.0% of total commercial loans).

Breakdown of retail loans

FUNDING STRUCTURE

Funding structure

Interbank's funding base was exposed to temporary impacts on the liquidity of the financial system and a depreciation of the foreign exchange rate, factors associated with political events in the country that took place in 2021, as well as to higher savings resulting from the withdrawals of private pension funds and the unrestricted availability of the Compensation for Time of Service (CTS) accounts. In addition, it was still influenced by the funding provided by the Central Bank, associated with the bank’s involvement in the Reactiva Peru Program. As of December 31, 2021, the balance of such special funding was S/ 4,389.9 million, compared to S/ 4,977.2 million as of September 30, 2021 and S/ 5,887.9 million as of December 31, 2020.

The bank’s total funding base declined 2.9% QoQ, compared to the 1.4% decrease of interest-earning assets. This was explained by reductions of 3.4% in deposits and obligations and 2.7% in bonds, notes and other obligations, which were partially offset by a 0.2% increase in due to banks and correspondents and inter-bank funds. Excluding the effect of the Reactiva Peru Program’s funds, the

11

bank’s total funding base would have decreased 2.1% QoQ, while due to banks and correspondents and inter-bank funds would have increased 19.4%.

The quarterly reduction in deposits and obligations was mainly due to decreases of 9.4% in commercial deposits and 1.6% in retail deposits, partially offset by 6.3% growth in institutional deposits.

The QoQ decline in bonds, notes and other obligations was mainly attributable to a 3.6% reduction of the foreign exchange rate with respect to 3Q21.

The small increase in due to banks and correspondents and inter-bank funds was mainly the result of higher funds from COFIDE and the Central Bank, which were almost fully compensated by a reduction in long-term funding provided by correspondent banks abroad.

The bank’s total funding base slightly decreased 0.7% YoY, as opposed to the annual growth in interest-earning assets. This was explained by a reduction of 13.6% in due to banks and correspondents and inter-bank funds, partially compensated by growth of 6.9% in bonds, notes and other obligations, and 0.9% in deposits and obligations. Excluding the effect of the Reactiva Peru Program’s funds, the bank’s total funding base and due to banks and correspondents and inter-bank funds would have increased 1.9% and 6.4% YoY, respectively.

The annual decrease in due to banks and correspondents and inter-bank funds was mainly the result of a reduction in long-term funding provided by the Central Bank and COFIDE, associated with lower funds for the Reactiva Peru Program, in addition to lower long-term funds from correspondent banks abroad. These effects were partially offset by higher short-term funding provided by correspondent banks abroad and COFIDE.

The YoY increase in bonds, notes and other obligations was mainly attributable to a 10.1% depreciation of the foreign exchange rate with respect to 4Q20, partially compensated by the execution of an optional redemption of S/ 110.0 million local subordinated bonds in September 2021.

The annual growth in deposits and obligations was mainly explained by an increase of 10.1% in retail deposits, partially offset by reductions of 20.7% in institutional deposits and 0.4% in commercial deposits.

As of December 31, 2021, the proportion of deposits and obligations to total funding was 74.9%, higher than the 73.7% reported as of December 31, 2020. Likewise, the proportion of institutional deposits to total deposits decreased from 17.7% as of December 31, 2020 to 13.9% as of December 31, 2021.

Breakdown of deposits

12

NET INTEREST AND SIMILAR INCOME

Net interest and similar income

Interest and similar income

Interest and similar expense

QoQ Performance

Net interest and similar income grew 9.5% QoQ due to an 8.4% increase in interest and similar income, partially offset by 5.3% growth in interest and similar expense.

The higher interest and similar income was due to increases of more than two-fold in interest on due from banks and inter-bank funds, 9.5% in interest on financial investments and 6.9% in interest on loans.

Interest on due from banks and inter-bank funds grew S/ 12.9 million QoQ, or more than two-fold, explained by a 30 basis point increase in the nominal average rate, in spite of a 6.6% reduction in the average volume due to lower reserve funds at the Central Bank.

Interest on financial investments increased S/ 6.3 million QoQ, or 9.5%, due to a 20 basis point increase in the average yield, from 2.8% in 3Q21 to 3.0% in 4Q21, in addition to 1.7% growth in the average volume.

Interest on loans grew S/ 57.3 million QoQ, or 6.9%, as the result of a 40 basis point increase in the average yield, together with 1.4% growth in the average loan portfolio.

The higher average rate on loans, from 7.9% in 3Q21 to 8.3% in 4Q21, was mostly explained by yield increases in consumer loans.

13

The higher average volume of loans was attributed to 3.5% growth in retail loans, partially offset by a decrease of 0.5% in commercial loans. In the retail portfolio, average volumes increased 5.5% in consumer loans and 0.8% in mortgages. In the commercial portfolio, average volumes decreased 5.7% in short and medium-term loans, and 3.1% in leasing operations, partially offset by 15.1% higher trade finance loans.

The nominal average yield on interest-earning assets increased 40 basis points QoQ, from 5.3% in 3Q21 to 5.7% in 4Q21, in line with higher returns on all components of interest-earning assets.

The higher interest and similar expense was due to increases of 17.2% in interest on deposits and obligations, and 11.0% in interest on due to banks and correspondents, partially compensated by a 7.3% reduction in interest on bonds, notes and other obligations.

The quarterly growth in interest on deposits and obligations was due to a 10 basis point increase in the average cost, from 0.8% in 3Q21 to 0.9% in 4Q21, partially offset by a slight 0.3% decrease in the average volume. The increase in the average cost was due to higher rates paid to institutional deposits and certain commercial deposits following the Central Bank’s decision to start increasing the monetary policy rate. However, the average rate on retail deposits remained stable. By currency, average balances of dollar-denominated deposits increased 3.9% while average soles-denominated deposits decreased 2.4%, leading to an overall stable volume.

Interest on due to banks and correspondents increased S/ 3.9 million QoQ, or 11.0%, explained by a 30 basis point increase in the average cost, partially offset by a 3.5% reduction in the average volume. The higher average cost was explained by increased rates paid to funds from correspondent banks abroad and the Central Bank. The decrease in the average volume was mostly attributed to lower funding from correspondent banks abroad.

The reduction in interest on bonds, notes and other obligations was mainly due to a lower average cost of such obligations, following the redemption of S/ 110.0 million subordinated bonds in the local market in September 2021, partially compensated by the effect of a 1.6% depreciation of the average foreign exchange rate with respect to 3Q21.

The average cost of funding increased 10 basis points, from 1.5% in 3Q21 to 1.6% in 4Q21, as the result of higher implicit cost of deposits and obligations, and due to banks and correspondents.

As a result of the above, net interest margin was 4.4% in 4Q21, 40 basis points higher than the 4.0% reported in 3Q21.