23 October 2009

Banco de Chile Rises on Goldman Sachs Upgrade

By Nathan Gill
Oct. 23 (Bloomberg) -- Banco de Chile, the country’s second-biggest lender, rose in Santiago trading after Goldman Sachs Group Inc. upgraded the shares.

Santiago-based Banco de Chile gained 0.5 percent to 42.7, paring a weekly loss of 0.4 percent. SM-Chile SA, the bank’s holding company, jumped 6.8 percent to its highest price on record. 

Goldman Sachs upgraded Banco de Chile to “neutral” from “sell,” citing the shares underperformance compared with regional peers and an improved economic outlook. The shares have gained 32 percent this year, compared with the Ipsa’s 44 percent advance. Chile’s Finance Minister Andres Velasco said today the country’s recovery may be “vigorous.”

“Having lagged other banks under coverage in recent months, Banco de Chile now has 10 percent upside to our 12-month target,” Goldman Sachs wrote. “We also are factoring in stronger GDP growth in some countries.”