Critical Survey: Banco Santander Chile (NYSE:BSAC) versus Bank of East Asia (OTCMKTS:BKEAY)

Banco Santander Chile (NYSE:BSAC) and Bank of East Asia (OTCMKTS:BKEAY) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, risk, earnings, analyst recommendations, dividends, institutional ownership and profitability.

Insider & Institutional Ownership

6.4% of Banco Santander Chile shares are held by institutional investors. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Volatility & Risk

Banco Santander Chile has a beta of 0.55, indicating that its stock price is 45% less volatile than the S&P 500. Comparatively, Bank of East Asia has a beta of 0.1, indicating that its stock price is 90% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and target prices for Banco Santander Chile and Bank of East Asia, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Banco Santander Chile	1	4	2	0	2.14
Bank of East Asia	0	1	0	0	2.00

Banco Santander Chile presently has a consensus price target of $35.50, suggesting a potential downside of 0.15%. Given Banco Santander Chile’s stronger consensus rating and higher possible upside, analysts clearly believe Banco Santander Chile is more favorable than Bank of East Asia.

Dividends

Banco Santander Chile pays an annual dividend of $0.99 per share and has a dividend yield of 2.8%. Bank of East Asia pays an annual dividend of $0.05 per share and has a dividend yield of 2.8%. Banco Santander Chile pays out 43.0% of its earnings in the form of a dividend.

Profitability

This table compares Banco Santander Chile and Bank of East Asia’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Banco Santander Chile	24.57%	21.51%	1.57%
Bank of East Asia	N/A	N/A	N/A

Earnings and Valuation

This table compares Banco Santander Chile and Bank of East Asia”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Banco Santander Chile	$4.50 billion	3.72	$1.12 billion	$2.30	15.46
Bank of East Asia	$4.96 billion	0.97	$449.18 million	N/A	N/A

Banco Santander Chile has higher earnings, but lower revenue than Bank of East Asia.

Summary

Banco Santander Chile beats Bank of East Asia on 11 of the 13 factors compared between the two stocks.

About Banco Santander Chile

Banco Santander-Chile, together with its subsidiaries, provides commercial and retail banking services in Chile. It operates through Retail Banking, Middle-Market, Corporate Investment Banking, and Corporate Activities segments. The company offers debit and credit cards, checking accounts, and savings products; consumer, automobile, commercial, mortgage, and government-guaranteed loans; and Chilean peso and foreign currency-denominated loans to finance various commercial transactions, trade, foreign currency forward contracts, and credit lines, as well as mortgage financing services. It also provides mutual fund management, insurance and securities brokerage, foreign exchange services, financial leasing, financial consulting and advisory, investment management, foreign trade, leasing, factoring, treasury, and transactional services, as well as specialized services to finance residential projects. In addition, the company offers short-term financing and fundraising, and brokerage services, as well as derivatives, securitization, and other products; and manages capital allocations. It serves individuals, small to middle-sized entities, companies, and large corporations, as well as universities, government entities, and local and regional governments. The company was incorporated in 1977 and is headquartered in Santiago, Chile. Banco Santander-Chile operates as a subsidiary of Banco Santander, S.A.

About Bank of East Asia

The Bank of East Asia, Limited, together with its subsidiaries, provides various banking and related financial services. Its personal banking services include corporate, individual, savings, current, time deposit, and supreme accounts; and time deposits, foreign currency deposits, MAS services, and auto-payroll products, as well as safe deposit boxes and remittance services. The company also provides corporate banking services, such as SME loans and financing guarantee schemes; corporate and commercial financing products, including syndicated and construction loans, acquisition and structured financing, working capital financing, share financing and IPO-related loans, and commercial mortgages; trade finance services and expert trade solutions; factoring services; import and export trade finance; guarantee services; eTradeConnect that allows buyers and sellers to connect, transact, share information, and submit applications for financing through a single platform; cash management services; corporate wealth management products; foreign exchange and treasury products; and marine cargo, property, trade credit, employee compensation, life, savings, and endowment insurance plans. In addition, it offers private banking services comprising investment advisory services; investment solutions, such as unit trusts, linked deposits, currency trading and management, global equities and bonds investments, structured products, and options and derivatives; portfolio management services; securities and futures broking services; cyber banking, credit cards, and ATM; and various international services. The company operates outlets in Hong Kong, rest of Greater China, Singapore, Malaysia, the United Kingdom, and the United States. The Bank of East Asia, Limited was incorporated in 1918 and is headquartered in Central, Hong Kong.