Colombia’s Biggest Bank is the Region’s Best-Kept Secret

In the first quarter of 2025, Colombia’s economy grew 2.7% year over year, according to BBVA.

At the same time, concerns about the nation’s economy, and its financial institutions, have remained due to the geopolitical situation surrounding the region. 

Following President Gustavo Petro’s inauguration in 2022- as the country’s first left-leaning president in history- its longstanding alliance with the U.S. has been pushed to breaking point. Even with years of prior economic trade agreements, relationships quickly broke down following a series of very public disagreements on trade deals, tariffs and migrant policies. 

This reached a fever pitch after Petro denied entry to U.S. planes carrying deported Colombians, drawing a retaliatory response from President Trump, which include threats of a 25% tariff on Colombian imports.

Colombians’ banking system, however, has persisted. 

Bancolombia (CIB), the nation’s largest bank and one of the top 10 financial services providers in Latin America, is trading at a discount to its peers, although signs of decline are not present. The company’s PE ratio is 7.67.

In fact, with almost 30,000 employees and a presence across Colombia, Panama, Guatemala and El Salvador, the financial institution continues to maintain its foothold with millions of existing customers and continuously expands its business model and market reach. 

For the past two months, 2 earnings estimates for Bancolombia have moved higher, with these helping to boost CIB's estimated EPS from $6.42 to $6.79. Given the current valuation is in part to do with frayed diplomatic relations between the U.S. and Colombia, rather than with the bank’s business performance and long-term competitive advantage, confidence should be preserved. 

Here are three reasons why we should remain bullish on Bancolombia:

Looking beyond the tariff fallout in Colombia

After the diplomatic turmoil with the U.S., it became evident that President Petro was actively working to build alternative international alliances and reduce ties with the U.S.

In May, following a visit to Beijing, Petro signed a collaboration memorandum for Colombia to join the Belt and Road Initiative (BRI), a global infrastructure development program adopted by the Chinese government.

Since then, the rupture between Colombia and the U.S. has increasingly deepened. On June 20, Colombia aligned with the BRICS New Development Bank, strengthening ties with the global forum led by China, Brazil, India, Russia and South Africa that could see further U.S. trade retaliation- deemed by experts as a dangerous bet jeopardizing the country’s internal security.

Within the region, a new floating facility to produce crude oil at a project operated by China Concord Resources Corp (CCRC) also arrived last week in Lake Maracaibo, Venezuela, as reported Reuters, citing two sources and images.

Despite the challenges created by recent events taking place on the global stage, Bancolombia remains a leading financial institution that investors would be wise to pay note to. Although the Trump-led tariffs have been a point of contention, almost all internal imports to the U.S. are included, meaning this isn’t a decision to specifically target Colombia.

The bank’s competitive advantages in the market

In light of the bank’s valuation, it’s important to take a closer look at actual business performance and the market conditions Bancolombia is working with.

Bancolombia represents the backbone of commerce and growth in Colombia. 

With more than 30 million customers, it’s by far the largest bank in the country, and also handles “about 25% of all deposits” and 72% of all financial transactions nation-wide. 

“When we look at Colombia’s financial ecosystem, it’s impossible to ignore the central role Bancolombia plays,” says Marcelino Bellosta, Chairman of MIDI, a U.S.-based financial platform for remote workers. 

“In Latin America, trust and scale are everything. Bancolombia’s reach into everyday commerce, remittances, and innovation gives it a resilience that goes beyond short-term political cycles. Investors often underestimate how embedded it is in the fabric of the economy,” he added. 

Indeed, Bancolombia’s total funding disbursed across various industries totaled 52.9 trillion COP ($13.2 billion USD) between January and June 2025, highlighting the institution’s role in bolstering the country’s productive sector and situating Colombia among Latin America’s most dynamic economies. 

Meanwhile, the bank's market share in its home country allows for heavier marketing and IT spending, recruiting the best talent, and creating new products and services. Here, Bancolombia hasn’t rested on its laurels, using its position and market share to embrace innovation in contrast to the approach taken by other incumbent banks. 

It has, for instance, embraced open banking opportunities including banking-as-a-service to evolve its business model with features like digital wallets and its popular QR code payment method.

The bank also created neobank Nequi in response to the needs of customers for seamless digital banking experiences, and Wompi- a payment gateway that has cornered one-fifth of the market.

With Colombia’s vibrant tech ecosystem, however, opportunities for collaboration and cutting-edge advancement are far from scarce. Medellín, the country’s second-largest city and home of Bancolombia, has emerged as a regional innovation hub via companies such as Source Meridian, which provides AI-driven software development for enterprises, illustrating the depth of technological savvy in the country. 

Opportunities for the bank to support the greater region 

When speaking about the Colombian economy, it’s critical to recognize the substantial purchasing power that citizens across the globe deliver. According to the Migration Policy Institute, close to 855,000 Colombian immigrants reside in the United States, representing the largest migrant group from South America in the North American giant.

Bancolombia in particular is well-placed to service this diaspora with a longstanding presence in the U.S., particularly in Miami, Florida, the state with the third-largest Latino population, only after California and Texas. 

This reach goes beyond consumer banking services alone. Bancolombia Capital provides investment banking services in the U.S., particularly for Colombian clients looking to access American financial markets.

The banking institution also has a track record of taking proactive approaches in partnering with fintech companies to address challenges for Latin American populations and launching its own ventures in response to emerging user behavior trends. Wenia, for instance, was Bancolombia’s bet to enter the cryptocurrency market, responding to widespread demand within Colombia- which boasts the fourth-highest rate of crypto adoption in Latin America. 

By creating a company that allows users to buy, convert, receive, send, and sell cryptocurrencies while adhering to high-security standards and industry best practices, we can see how this legacy bank keeps ahead of emerging fintech trends to retain users and maintain its position in the future. With this approach, Bancolombia will surely continue to acquire new users and retain existing ones, signaling stable growth ahead. 

The institution’s empowerment of women users marks another indicator for a bright future. A study carried out by the FAIR Center for Financial Access, Inclusion, and Research at Tecnológico de Monterrey and Pro Mujer found 73% of women entrepreneurs in Latin America struggle to access support from financial institutions, relying on personal and family savings to launch ventures. Taking heed of these kinds of disparities, the bank made a significant investment of $1.5 million USD in Colombian fintech Quipo to support the provision of working capital. 

More broadly, investors are showing interest in backing finance solutions that provide the Latino diaspora with finance and credit solutions. After seeing revenue grow by 300% in 2024, US-based fintech Kiwi raised a $7.8 million Series A equity round co-led by LIP Ventures and Advent-Morro Equity Partners to expand credit access for underserved Latino communities across the United States.

Colombia’s bright future

Ongoing geopolitical challenges are testing many economies in Latin America, and Colombia’s banks are no exception. Rising global interest rates, currency volatility, and inflation squeeze margins while also reshaping demand for credit. 

The relationship between Colombia and the U.S., however, is too strong to be critically impaired. This past Mother’s Day season, for instance, Avianca Cargo celebrated transporting over 20,100 tons of fresh flowers from Colombia and Ecuador to markets across the U.S. and Europe, marking a historic 15% increase over 2024. 

Other consumer-facing markets, such as the fruit trade, also highlight the stability of relations. In 2024, 23% of Colombian fruit exports were destined to the U.S., accounting for $561.78 million USD- the seventh largest import, followed by key industries like plastics, sugars, apparel, and copper. With the recent 29% fresh fruit export growth in Colombia, both nations have begun negotiations to allow key Colombian fruits to enter the U.S. market tariff-free. 

Fair-trade oriented export company Caribbean Exotics, for instance, ships exotic fruits like golden berries, soursop, and passion fruit to markets in the U.S., Europe, Hong Kong and others, while also spearheading a social impact program that boosted the incomes of 300 Colombian farming families by 545% between 2013 and 2019. Golden berries alone- a staple in Colombians’ diet- generated $40 million USD in 2024, and are projected to continue their 9% value growth. 

Such cases underscore how Colombian enterprises are persisting and scaling globally, while delivering social value. Bancolombia remains, however, the strongest embodiment of this spirit. 

While undervalued, its resilience makes Colombia’s economic fabric shine. With significant market strength, continued exploration of new business lines, and solid international backing, the institution is poised to withstand ongoing challenges and also drive a supportive ecosystem.