Chile has the most stable economy in South America. Its GDP has diversified over the years with the main economic sectors being services, commerce, manufacturing, and mining which make up over 70% of GDP. Chile has a stock market worth over $300 billion, the fourth largest in Latin America, and actively trades on the Santiago stock exchange. Chile also has an active bond market and uses catastrophe bonds to insure against risks from natural disasters, recently purchasing $630 million in coverage. The Chilean banking system is well regulated and resilient, with 18 commercial banks, though banks face competition from other financial services.
Chile has the most stable economy in South America. Its GDP has diversified over the years with the main economic sectors being services, commerce, manufacturing, and mining which make up over 70% of GDP. Chile has a stock market worth over $300 billion, the fourth largest in Latin America, and actively trades on the Santiago stock exchange. Chile also has an active bond market and uses catastrophe bonds to insure against risks from natural disasters, recently purchasing $630 million in coverage. The Chilean banking system is well regulated and resilient, with 18 commercial banks, though banks face competition from other financial services.
Chile has the most stable economy in South America. Its GDP has diversified over the years with the main economic sectors being services, commerce, manufacturing, and mining which make up over 70% of GDP. Chile has a stock market worth over $300 billion, the fourth largest in Latin America, and actively trades on the Santiago stock exchange. Chile also has an active bond market and uses catastrophe bonds to insure against risks from natural disasters, recently purchasing $630 million in coverage. The Chilean banking system is well regulated and resilient, with 18 commercial banks, though banks face competition from other financial services.
Chile has the most stable economy in South America. Its GDP has diversified over the years with the main economic sectors being services, commerce, manufacturing, and mining which make up over 70% of GDP. Chile has a stock market worth over $300 billion, the fourth largest in Latin America, and actively trades on the Santiago stock exchange. Chile also has an active bond market and uses catastrophe bonds to insure against risks from natural disasters, recently purchasing $630 million in coverage. The Chilean banking system is well regulated and resilient, with 18 commercial banks, though banks face competition from other financial services.
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Economic Development
SOUTH AMERICA:CHI LE BSA-1 Group 6 0577 4788 4210 0001 SOUTH AMERICAN COUNTRIES ● Argentina The most developed ● Brazil ● Cuba country: ● Ecuador CHILE ● Greece ● Colombia ● Peru Chile’s economy is considered as ● Venezuela South America’s most stable ● Bolivia economy. GDP has become more ● Uruguay diversified throughout the years. ● Etc. THE MOST DEVELOPED COUNTRY: CHILE SCOPE THE ECONOMY OF 01 CHILE STOCK MARKET OF 02 CHILE BOND MARKET OF 03 CHILE 04 BANKS IN CHILE 01. THE ECONOMY OF CHILE Our Economy and Financial System | Banco Santander Chile. (n.d.). Banco Santander Chile. https://santandercl.gcs-web.com/our-economy-and-financial-system THE ECONOMY OF CHILE Population 19.1 million GDP US $276 billion GDP per capita (PPP) US $ 14,986 Exports / GDP 25% Investments / GDP 19% Net public debt / GDP 13% % GDP BY ECONOMIC SECTOR 5%3% 4% 7% 36% 7%
8%
9% 11% 10%
Service Commerce Manufacturing
Mining Others Construction Trans & Comm Utilities Public admin Fishing and Agri CHILE’S ECONOMIC GROWTH FACTORS
Positve Development Challenges
1. Chilean household high 1. Consolidation debts 2. Investment in Technology 2. Covid-19 impact And Innovation 3. Stable Regulatory Environment
International Monetary Fund. Monetary and Capital Markets Department. (2022). Chile: Financial Sector Assessment Program— Technical Note on Crisis Management and Bank Resolution. Imfsg. https://doi.org/10.5089/9798400219740.002.A001 02. STOCK MARKET TRADING ECONOMICS. (n.d.). Chile Stock Market (IGPA) - 2023 Data - 1993-2022 Historical - 2024 Forecast - Quote. https://tradingeconomics.com/chile/stock-market Santiago Stock Exchange Or Bolsa de Comercio de Santiago in Spanish, is the name of the stock exchange in Chile. With a history that dates back to 1893, it is one of Latin America's most advanced and vibrant The largest stock exchange in Chile is the Santiago Stock stock markets. Exchange, which has over 240 listed businesses and a $300 billion market size. After Brazil, Mexico, and Argentina, it is the fourth-largest stock market in the Chile is one of the fastest growing economies in Latin America in the last decade and a highly attractive market for investment. Chilean stock have outperformed due to HIGHER COMMODITY PRICES. A look inside the ECH (security industries) shows that an overweight allocation to commodities helped the ETF (exchange traded fund) last year, even as rising interest rates dinged emerging markets across the board.
The top holding or contributor is Sociedad Quimica Y Minera De
Chile. It’s a major lithium producer that counts for 24.2% of the ETF that enjoyed the spike in prices last year The SANTIAGO STOCK EXCHANGE (SSE) is the premier stock exchange of Chile. • Located in Santiago, the SSE trades more than $2 billion each day in stocks, bonds, investment funds, and derivatives, along with gold and silver Chilean coins. • Its goal is to provide the nation with growth in the securities market in order to help boost the country's development 03. BOND MARKET The Chile cat bond – taking the temperature. (2023, March 24). https://www.preventionweb.net/news/chile-cat-bond-taking-temperature Bond Market of Chile The Republic of Chile has just purchased its second World Bank intermediated catastrophe bond. first real test of World Bank intermediated cat bonds in what is currently an expensive market for buyers. adding earthquake protection for Chile’s public finances. A Hot Market For Risk Transfer Catastrophe (‘cat’) bonds are a risk financing instrument used to transfer risk to the capital markets. Insurance policies
Chile cat bond was first offered to the market initial ‘price guidance’ range of 4.75-5.5%, final risk premium of 4.75% and an expected loss of 1%. Chile pays $4.75 in premiums for every $1 they expect to receive in payouts (in shorthand, the risk multiple is 4.75x). A Hot Market For Risk Transfer Catastrophe (‘cat’) bonds are a risk financing instrument used to transfer risk to the capital markets.
Insurance Policy
CATASTROPH Chile Cat Bond Was First Offered To
E BOND The Market Initial ‘price guidance’ range of 4.75-5.5%, final risk premium of 4.75% and an expected loss of 1%. Chile pays $4.75 in premiums for every $1 they expect to receive in payouts (in shorthand, the risk multiple is 4.75x). A WINDOW ON CAT BOND COST DRIVERS
Chile first tested the market with a $150 million
target coverage but has ended up buying $350 million on seeing the investor appetite for this bond. 2. Upsizing
1 2 3
1. Cost 3. Swamps, options and flexibility
This bond is certainly more expensive than the As well as the catastrophe bond, Chile has also 2018 policy, but even a multiple of 4.75x is low purchased $280 million of ‘catastrophe swaps,’ compared to other cat bonds being issued. bringing the combined coverage amount to $630 million. BANKS 04. IN CHILE Our Economy and Financial System | Banco Santander Chile. (n.d.). Banco Santander Chile. https://santandercl.gcs-web.com/our-economy-and-financial-system COMMERCIAL BANKING The most important sector which includes a number of privately-owned banks, and one public-sector bank, Banco del Estado de Chile
PRIVATE-SECTOR BANKS CHILEAN Includes local banks and a number of foreign- owned banks operating in Chile FINANCIAL PUBLIC-SECTOR BANK SERVICES Banco del Estado de Chile, is the only Public Bank in Chile and was created by government decree in 1953 CHILEAN BANKING SYSTEMof 18 banks, including one Comprises public-sector bank BANK COMPETITION
The Chilean banking system Moreover, they face
faces competition with: competition from non-bank finance competitors, such as 1. Department stores 2.Credit unions; and 1. Leasing 3.Cajas de compensación 2. Factoring and automobile -credit cards - finance companies consumer loans 3. Mutual funds - insurance brokerage. 4. Pension funds 5. Insurance companies According to the INTERNATIONAL MONETARY FUND in the latest Financial Sector Assessment program, that the Chilean financial system has been resilient to recent shocks, with a robust regulatory and supervisory framework and adequate response to Covid-19. It shows that the local financial system of Chile is able to MAINTAIN ACCESS TO FINANCING of household and companies, hedges, stock market operating normally, continuous payment systems, and banking infrastructure. Nevertheless, banks continue to be the main suppliers of leasing, factoring and mutual funds, and the insurance sales business has grown rapidly. OUR 06. MEMBERS 1. Jellian Kyle Salming 2. Pamela Charms Danielle Sumangue 3. Drizzle Dace Tan 4. Marian Joi Torreon 5. Christine Joy Tungal 6. Junalene Villarino THANKS! 359
