Notes to the Financial Statements Banco de Bogotá and ......2 BANCO DE BOGOTÁ S.A. AND SUBSIDIARIES Notes to the Consolidated Financial Statements Name of Subsidiary Main Activity

Notes to the Financial Statements

Banco de Bogotá and Subsidiaries

At june 30, 2015 december 31 and january 1, 2014

Gerencia de Consolidación e IFRS

BANCO DE BOGOTÁ S.A. AND SUBSIDIARIES Notes to the Consolidated Financial Statements

At June 30, 2015 (Compared to figures from December 31 and January 1, 2014)

(In millions of Colombian Pesos, except for the exchange rate and net earnings per share which are in Colombian Pesos)

1. Reporting Entity

Banco de Bogotá S.A. (Parent Company) is a private entity whose headquarters are in the city of BogotáD.C. at Calle 36 No. 7-47. It was incorporated by Public Deed No. 1923 of November 15, 1870 issued bythe Second Notary of Bogotá D.C. The Colombian Financial Superintendence renewed the operatinglicense indefinitely by means of Resolution No. 3140 / September 24, 1993. The duration established inthe Bylaws is until June 30, 2070, but it may be dissolved or extended before said term. The Bank'scorporate purpose is to enter into and carry out all the transactions and contracts legally authorized forcommercial banks, subject to the requirements and limitations of Colombian law.

At June 30, 2015, the Bank and its subsidiaries operate with thirty seven thousand seven hundred andsixty three (37,763) employees through a contract of employment, seven hundred and fifty two (752) witha training contract and two thousand seven hundred and thirty two (2,732) temporary employees. Inaddition, the Group has 3,669 individuals outsourced with specialized companies. It has 1,521 offices,10,519 correspondent banks, 3,462 ATMs, 2 agencies abroad in New York and Miami and 1 branch officewith a license to carry out local banking transactions in Panama City.

The consolidated financial statements include the financial statements of the Bank and the followingsubsidiaries (hereinafter the Group):

Name of Subsidiary Main Activity Place of

Business Direct

Holding (1) Indirect

Holding (1)

National Subsidiaries

Fiduciaria Bogotá S.A.

Entering into mercantile trust agreements and fiduciary mandates without transferring ownership, pursuant to legal provisions. Its main corporate purpose is to acquire, transfer, encumber, manage movable assets and real estate and invest, as a debtor or creditor, in all kinds of credit operations.

Bogotá, Colombia 94.99%

Almaviva S.A.(2) and subsidiary

Almaviva is a customs agent and a comprehensive logistics operator. Its main corporate purpose is the deposit, storage and custody, management and distribution, purchase and sale at the expense of its clients, of domestic and foreign goods and products; as well as the issue of certificates of deposit and warrants.

Bogotá, Colombia 94.92% 0.88%

Megalínea S.A. Technical and administrative services company. Its corporate purpose is the management and pre-legal collection, legal collection out of court collection on loans.


2

BANCO DE BOGOTÁ S.A. AND SUBSIDIARIES

Notes to the Consolidated Financial Statements

Name of

Subsidiary Main Activity Place of Business

Direct Holding (1)

Indirect Holding (1)

National Subsidiaries

Porvenir S.A.(3) and subsidiary

Porvenir is a pension and severance funds administrator. Its corporate purpose is the administration and management of the pension funds authorized by law and severance funds, which constitute private equity separate from the equity of the entity administrating them, in compliance with the legal provisions that regulate the matter.


Corficolombiana S.A. and

subsidiaries

Corficolombiana provides services specialized in private banking, investment banking, and cash and equity investments. The corporate purpose of the Corporation is to carry out all the acts and contracts authorized for this type of lending companies by the General Regulation of the Financial System or any other special provisions or regulations that may replace, amend or add to them. Corficolombiana also has a holding in entities in different sectors, such as the financial, energy and gas, construction and infrastructure, agricultural and hotel service sectors, among others.


Casa de Bolsa S.A. (4)

Stock brokerage and administration of securities funds. Its corporate purpose is the administration of mutual funds, the administration of securities, proprietary trading, stock brokerage and consultancy on the capital market in the conditions determined by the Board of Directors of the Central Bank of Colombia.


Foreign Subsidiaries

Leasing Bogotá Panama S.A.

and subsidiaries

Its corporate purpose consists of holding in other entities of the financial sector and in investment activities. Through its subsidiaries, it provides a wide variety of financial services to individuals and institutions, mainly in Costa Rica, El Salvador, Guatemala, Honduras, Mexico, Nicaragua and Panama.

Panama, Republic of

Panama 100.00%

Banco de Bogotá Panama S.A.

Entity with an international license to carry out banking business abroad. It operates in the Republic of Panama, and the Bank consolidates the Subsidiary Banco de Bogotá (Nassau) Limited.

Panama, Republic of

Panama 100.00%

Bogotá Finance Corporation.

This is a financial corporation and its corporate purpose is the issuance of securities at variable rates guaranteed by the Parent Company. Over the last few years, the Company has kept investment as the main income-generating activity.

Cayman Islands 100.00%

Corporación Financiera

Centroamericana S.A. (Ficentro)

(5)

Financial Institution authorized to place but not to receive funds from the public. It is supervised by Panama's Ministry of Finance. It is in the business of collecting on loans and managing assets received for sale.

Panama, Republic of

Panama 49.78% 49.78%

(1). The Banks percentages of direct and indirect holding in each of the subsidiaries have not varied over the last year. (2). Indirect holding through Banco de Bogotá Nassau Ltd. with a percentage of 0.88% for a total of 95.81%. (3). Indirect holding through Fiduciaria Bogotá, with a percentage of 10.40% for a total of 46.91%. (4). Indirect holding through Corficolombiana, with a percentage of 38.95% for a total of 61.75%. (5). Indirect holding through Corficolombiana, with a percentage of 49.78% for a total of 99.56%.

The Group is controlled by Grupo Aval Acciones y Valores S.A.

(Continued)

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2. Statement of Compliance with Accounting and Financial Reporting Standards in Colombia

The Group's consolidated financial statements attached hereto have been prepared in accordance with the accounting and financial reporting standards accepted in Colombia, which include: At January 1, 2013, the International Financial Reporting Standards (IFRS), included in the Annex to Decrees 3023 / 2013 and 2267 / 2014 issued by the Colombian Government, except: i) recognition in other comprehensive income in equity, without affecting the income for the accounting period, of the difference resulting between measuring the loan portfolio provisions pursuant to Chapter II of the Basic Accounting and Financial Bulletin issued by the Colombian Financial Superintendence) in the individual or separate financial statements and the measurement of the impairment of the loan portfolio according to IFRS; and ii) the wealth tax incurred annually and the option of its recognition charged to equity reserves, in accordance with Law 1739 / December 2014.

The implementation of the International Financial Reporting Standards for entities of public interest, such as banks, was required in Decree 2784 issued by the Colombian Government in December 2012. It is mandatory for accounting management and preparation of financial statements of entities of public interest, among other entities, as of January 1, 2015, with a transition period for the preparation of the opening statement of financial position at January 1, 2014, for the purposes of comparison. However, after that, Law 1739 / 2014 set forth the accounting treatment of the wealth tax and the Colombian Financial Superintendence ordered the recording of the resulting adjustment of loan portfolio provisions in other comprehensive income, as indicated in the above paragraph.

The Group's latest financial statements issued in accordance with the Colombia's previously accepted accounting principles (previous GAAP) are those issued at December 31, 2014. On February 27, 2015, the Independent Auditor issued his unqualified opinion.

The financial statements were authorized by the Board of Directors and Legal Representative on October 26, 2015, to be presented at the General Meeting of Shareholders for the approval thereof.

3. Significant Accounting Policies

In line with Colombian legislation, the Company must prepare separate and consolidated financial statements. Separate financial statements serve as the basis for distributing dividends and appropriating funds on behalf of the shareholders. Consolidated financial statements are submitted to the General Meeting of Shareholders for Group management purposes.

Below is a summary of the significant accounting policies, which have been consistently applied to all the periods presented and to the preparation of the opening statement of financial position for purposes of transition to the IFRS.

a) Basis of Measurement

The consolidated financial statements have been prepared based on historical cost, except for the following items, which have been measured using an alternate basis on each balance sheet date.

Item Basis of Measurement Financial Derivatives Fair Value through Profit or Loss

Financial instruments classified at fair value

Fair value through profit or loss and, for equity instruments designated in the initial recognition, at fair value through other comprehensive income

Certain components of the loan portfolio classified at fair value Fair Value through Profit or Loss Noncurrent Assets Held for Sale Fair value minus cost of sale Biological Assets Fair value minus cost of sale Financial assets in concession agreements Fair Value through Profit or Loss Inventories Lower value between cost and net realizable value

(Continued)

4



b) Use of Accounting Judgments and Estimates with a Significant Effect on Financial Statements The Group makes estimates and assumptions that affect the amounts recognized in the financial statements and the book value of assets and liabilities within the next accounting period. The judgments and estimates are continuously evaluated and are based on the Group's experience and other factors, including the expectation of future events believed to be reasonable. The Group also makes certain judgments other than those that involve estimates in the process of applying accounting policies. Judgments with the most important effects on the amounts recognized in the consolidated financial statements and the estimates that cause a significant adjustment to the book value of assets and liabilities in the upcoming year include the following:

i. Business Model

The Group applies significant judgments to determine its business model to manage financial assets and assess whether the financial assets meet the conditions defined in the business model in order to be classified at fair value or amortized cost. Financial assets classified at amortized cost can only be sold under limited circumstances in non-recurring and immaterial transactions in relation to the total portfolio in situations such as when the asset no longer complies with the Group's investment accounting policies, adjustments in the maturing structure of its assets and liabilities, need to finance significant capital disbursements and stationary liquidity needs.

ii. Impairment of the Loan Portfolio The Group regularly reviews its loan portfolio to assess its impairment and determine the amount of said impairment, analyze its reasonableness and record it against the period's income. This evidence can include data indicating that there has been an adverse change in the debtors' performance in each loan portfolio (commercial, consumer, mortgage, microcredit and leasing), in the Group or in the country, or in the local conditions of the economy correlated with defaults on the Group's assets. Management uses estimates based on historical experiences with loans that have similar risk characteristics and objective evidence of similar impairments on loan portfolios when their future cash flows mature. The methods and assumptions used to estimate the amount and timeliness of future cash flows are reviewed regularly to reduce any difference between loss estimates and the actual experience of loss. A 10% increase in the current experience of loss compared to the current estimates used (increase in the Probability of Default - PD - of each client/transaction) would result in an increase in the loan portfolio provision of COP 57,701 and COP 49,562 at June 30, 2015 and December 31, 2014, respectively. For the transactions analyzed individually, loss due to impairment is based on future discounted cash flow estimates of individual loans considering their probability of collection and the realization of any asset held as collateral on said loans. A 10% increase in the current experience of loss compared to the current future discounted loan cash flows that are individually significant, which can arise from differences in amounts and the timeliness of future cash flows would result in an increase in the loan provision of COP 107,836 and COP 106,880 at June 30, 2015 and December 31, 2014, respectively.

iii. Fair Value of Financial Instruments

The fair values of financial instruments are estimated according to the fair value hierarchy, classified in three levels that reflect the importance of the variables used in this measurement.

(Continued)

5



Information on the fair values of financial instruments classified by levels using observable data for levels 1 and 2 and non-observable data for level 3, is provided in Note 5.

Establishing what constitutes as "observable" requires a significant judgment by the Group. The Group considers observable data as market data that are already available, which are regularly updated or distributed, reliable and verifiable and reflect the assumptions that the market players would use to fix the price of the asset or liability.

iv. Deferred Income Tax

The Group evaluates the possibility of building deferred income tax assets over time. This represents income taxes that can be recovered through future deductions from taxable income, and they are recorded in the statement of financial position. Deferred income tax assets are considered to be recoverable when the relative tax benefits are considered to be probable. Future tax income and the amount of tax benefits considered to be probable in the future are based on mid-term plans prepared by management. The business plan is based on management expectations that are believed to be reasonable under the circumstances.

At June 30, 2015 and December 31, 2014, the Group estimates that deferred income tax asset entries will be recoverable based on estimates for future taxable income. Deferred tax liabilities with regard to investments in subordinated are recognized over temporary differences associated with profits not distributed by the subsidiaries, except when the Group controls the dividend policy of the subsidiary and it is probable that the temporary difference will not be reversed in the foreseeable future. See Note 21.

v. Valuation of Biological Assets

The valuation of the Group's biological assets in long-term crops is determined based on reports prepared internally by the Group's companies, by experts in the development of said crops and in the preparation of valuation models. Due to the nature of these crops from comparable markets, the fair value of these assets is determined based on models of cash flow deducted from net future cash flows of each crop, considering the estimated future amounts of products to be harvested, the current prices of said products and the estimated costs of their growth, maintenance and future collection, discounted at risk-free interest rates adjusted by the risk premiums required in these circumstances. See Note 16.

vi. Assessment Due to Impairment of the Cash-Generating Units with Distribution of Capital Gains

The Group's management assesses the impairment of the capital gains recorded in its consolidated financial statements on a yearly basis closing on November 30, and whenever there is any indication that one of the Group's cashgenerating units for which the capital gains were distributed may have been impaired based on studies carried out for this purpose by independent experts hired for said purpose and in accordance with IAS 36 - Impairment of Assets. These studies are conducted based on valuation of the groups of cash-generating units that have the different capital gains assigned in their acquisition, by the discounted cash flow method, taking into account factors such as: the economic situation of the country and the sector in which the Group operates, historical financial information, and forecast growths of the Company's income and costs over the next five years, then later, indefinite growth taking into account their indexes of profit capitalization, discounted at risk-free interest rates that are adjusted by the risk bonuses required in the circumstances of each company. The assumptions used for these valuations are disclosed in Note 20.

(Continued)

6



The methods and assumptions used for the valuation of the different cash-generating units that have capital gains assigned were reviewed by management. Based on this review, it concluded that at December 31, 2014, it was not necessary to record any impairment, taking into account that its recoverable amounts are significantly higher than its book values. Additionally, at June 30, 2015, cash-generating units with distribution of capital gains that had presented impairment ratios had not been presented.

vii. Estimate for Legal Processes

The Group estimates and records a provision for legal processes, with the goal of covering possible losses from labor, civil suit, business or fiscal cases, or other circumstances. This is based on management's opinion, supported by the opinions of external legal advisors when necessary, and when losses are considered probable, which can be reasonably quantified. Due to the nature of many claims, cases and/or proceedings in some cases it is not possible to make an accurate prediction or to reasonably quantify the amount of loss. Therefore, the differences between the real amount of the actual disbursements and the amounts initially provisioned and estimated are recorded in the period in which they are identified. See Note 26.

viii. Employee Benefits

The measurement of pension obligations and other long-term obligations depend on a wide variety of long-term assumptions and premises established over actuarial bases, including estimates of the present value of forecast future payments of the benefits, considering the probability of potential future events, such as increases in the minimum wage and demographic experience. These premises and assumptions may have an effect on the amount and on future contributions if there is any variation.

The discount rate allows future cash flows to be established at the present value on the date of measurement. The Group establishes a long-term rate that represents the market rate of high-quality fixed-income investments or government bonds in the currency in which the benefit will be paid, and it considers the opportunity and amounts of future payments of benefits for which the Group has selected government bonds. The pension plan is described in Note 25. The Group uses other key premises to value actuarial liabilities, which are calculated based on the Company's specific experience combined with published statistics and market indicators (See Note 25, which describes the most important assumptions used in actuarial calculations and the corresponding sensitivity analyses).

c) Reporting Currency and Presentation

The Group's administration considers the Colombian peso to be the currency that best represents the economic effects of transactions, events and conditions, and for that reason, the accompanying financial statements and disclosures are presented in millions of Colombian Pesos as its reporting currency. The figures reported in the separate financial statements of the Group's controlled companies are expressed in the currency of the primary economic environment (reporting currency) where each entity operates and they are translated for the effects of consolidation with Colombian Pesos. All the effects of translation are recorded in other comprehensive income in equity according to IAS 21. "Effects of Variations in Foreign Currency Exchange Rates".

(Continued)

7



d) Consolidation and Equity Method In line with Colombian legislation and the International Financial Reporting Standards, the Group must prepare separate and consolidated financial statements. Separate financial statements serve as the basis for distributing dividends and appropriating funds on behalf of shareholders. The consolidated financial statements are presented to the General Meeting of Shareholders and they include the assets, liabilities, equity, income, expenses and cash flows of the controlling company and its subsidiaries as if it were a single economic entity.

i. Controlled Entities

According to the International Financial Reporting Standards IFRS 10, the Group must prepare consolidated financial statements with its controlled entities. The Group has control over another entity if and only if it meets all the following conditions: - Power over the investee providing it with the present capacity to guide its relevant activities that affect

its performance significantly. - Exposure or entitlement to variable returns from its involvement in the investee. - Capacity to use its power over the investee entity to influence the amount of the investor's returns.

In the process of consolidation, the Group combines the assets, liabilities and income of the controlled entities, before standardizing their accounting policies and translating the financial statements of subsidiaries abroad to Colombian Pesos. In this process, any reciprocal transactions and unrealized earnings between them are eliminated. The share of non-controlling interest in the controlled entities are presented in equity separately from the shareholder equity of the Group's controlling company. The financial statements of the controlled companies abroad in the process of consolidation have their assets and liabilities translated to Colombian Pesos at the closing exchange rate, the statement of income at the average exchange rate of the month and equity at the historical exchange rate. The resulting net adjustment is included in equity as an "adjustment for the conversion of the financial statements" in the "other comprehensive income" account. The accompanying financial statements include the assets, liabilities, equity and income of the Parent Company and its controlled companies. The following are the details of the shares in each of them at June 30, 2015 and December 31, 2014: June 30, 2015

Entity

% Shareholding

Assets Liabilities Equity Net income

Banco de Bogotá S.A. (Parent Company) COP 72,685,659 58,529,629 14,156,031 1,206,393 Almacenes Generales de Depósito Almaviva S.A. and subsidiaries 94.92 109,051 48,426 60,625 4,277

Fiduciaria Bogotá S.A. 94.99 276,719 68,506 208,213 32,797 Corporación Financiera Colombiana S.A. and subsidiaries 38.19 17,819,924 13,542,800 4,277,124 260,836

Sociedad Administradora de Pensiones y Cesantías Porvenir S.A. and subsidiaries 36.51 2,166,594 913,953 1,252,641 146,030

Banco de Bogotá S.A. - Panama and Subsidiary 100.00 3,964,375 3,776,807 187,569 11,254 Bogotá Finance Corporation 100.00 221 0 221 1 Leasing Bogotá S.A. – Panama and subsidiaries 100.00 50,703,519 42,789,056 7,914,462 393,340 Corporación Financiera Centroamericana S.A Ficentro 49.78 0 1 (1) 0 Megalinea S.A. 94.90 12,249 9,220 3,028 650 Casa de Bolsa S.A. 22.80 62,523 34,135 28,387 529

147,800,833 119,712,533 28,088,300 2,056,105 Eliminations (13,308,697) (724,492) (12,584,205) (1,049,669) Consolidated COP 134,492,136 118,988,041 15,504,095 1,006,436

(Continued)

8



December 31, 2014

Entity

% Shareholding

Assets Liabilities Equity Net

income

Banco de Bogotá S.A. (Parent Company) COP 67,173,080 53,472,148 13,700,932 757,628

Almacenes Generales de Depósito Almaviva S.A. and subsidiaries

94.92 105,985 47,285 58,962 11,370


94.99 254,579 64,775 189,804 30,433 Corporación Financiera Colombiana S.A. and subsidiaries

37.90 14,567,048 11,903,769 4,223,777 257,930

Sociedad Administradora de Pensiones y Cesantías Porvenir S.A. and subsidiaries

35.28 1,963,807 775,855 1,189,180 126,097

Banco de Bogotá S.A. - Panama and Subsidiary

100.00 2,864,722 2,675,150 189,572 4,209 Bogotá Finance Corporation

100.00 203 0 203 1

Leasing Bogotá S.A. – Panama and subsidiaries

100.00 45,653,963 38,714,717 6,939,950 238,722 Corporación Financiera Centroamericana S.A Ficentro

49.78 0 0 0 0

Megalinea S.A.

94.90 14,054 11,669 2,386 145 Casa de Bolsa S.A.

22.79 63,181 34,713 28,468 265

132,660,623 107,700,081 26,523,233 1,426,799 Eliminations

(12,078,697) 1,742,051 (11,552,390) (720,264) Consolidated

COP 120,581,926 109,442,131 14,970,843 706,535

January 01, 2014

Entity

% Shareholding

Assets Liabilities Equity Net

income

Banco de Bogotá S.A. (Parent Company) COP 57,412,815 46,074,977 11,337,838 1,386,712 Almacenes Generales de Depósito Almaviva S.A. and subsidiary 94.92 100,338 56,312 44,027 17,176

Fiduciaria Bogotá S.A. 94.99 239,178 55,465 183,713 42,542 Corporación Financiera Colombiana S.A. and subsidiaries 38.19 16,712,903 14,269,532 2,443,371 (261,141) Sociedad Administradora de Pensiones y Cesantías Porvenir S.A. and subsidiary 35.28 1,682,216 646,545 1,035,671 64,766

Banco de Bogotá S.A. - Panama and Subsidiary 100.00 2,011,959 1,882,192 129,767 22,544 Bogotá Finance Corporation 100.00 162 0 162 66 Leasing Bogotá S.A. – Panama and subsidiary 100.00 34,995,338 29,913,806 5,081,533 203,833 Corporación Financiera Centroamericana S.A Ficentro 49.78 0 0 0 (1,914) Megalinea S.A. 94.90 7,273 5,064 2,209 137 Casa de Bolsa S.A. 22.79 49,704 21,232 28,472 1,511

113,211,887 92,925,125 20,286,763 1,476,232 Eliminations (10,312,191) (1,093,206) (11,405,396) (766,450) Consolidated COP 102,899,696 91,831,919 8,881,367 709,782

ii. Standardization of Accounting Policies

The Bank carries out the standardization to apply standard accounting policies for transactions and other similar events that have taken place in similar circumstances. The following standardizations were carried out for the preparation of the consolidated financial statements: Leasing Bogotá S.A. Panama June 30, 2015

Assets Liabilities Equity Income for the Period

Balances according to IFRS reported by the subsidiary COP 50,763,048 42,864,982 7,898,065 358,458 Standardization adjustments:

Purchase accounting reversion based on regulations applied by subsidiaries (Purchase Price Allocation)

272,358 (71,926) 344,284 12,853

Other standardization adjustments (1)

(331,887) (4,000) (327,887) 22,029 Balances based on the technical regulatory framework applicable to the Bank for the preparation of consolidated financial statements

COP 50,703,519 42,789,056 7,914,462 393,340

(Continued)

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December 31, 2014


Balances according to IFRS reported by the subsidiary COP 45,722,660 38,790,683 6,931,978 262,155 Standardization adjustments:


228,659 (75,717) 304,376 27,258


(297,356) (249) (297,108) (50,691) Balances based on the technical regulatory framework applicable to the Bank for the preparation of consolidated financial statements

COP 45,653,963 38,714,717 6,939,246 238,722

January 01, 2014


Balances according to IFRS reported by the subsidiary COP 35,129,139 30,003,689 5,125,450 0 Standardization adjustments:


109,286 (92,561) 201,847 0


(243,087) 2,678 (245,764) 0 Balances based on the technical regulatory framework applicable to the Bank for the preparation of consolidated financial statements

COP 34,995,338 29,913,806 5,081,533 0

(1) These are the adjustments of goodwill, investments and loan provisions.

Banco de Bogotá S.A. Panamá

June 30, 2015


Balances according to IFRS reported by the subsidiary COP 3,964,376 3,776,808 187,568 9,774 Standardization adjustments (1) 0 0 0 1,480 Balances based on the technical regulatory framework applicable to the Bank for the preparation of consolidated financial statements

COP 3,964,376 3,776,808 187,568 11,254

December 31, 2014

Assets Liabilities Equity

Income for the Period

Balances according to IFRS reported by the subsidiary COP 2,864,722 2,675,149 189,572 11,753 Standardization adjustments (1) 0 0 0 (7,544) Balances based on the technical regulatory framework applicable to the Bank for the preparation of consolidated financial statements

COP 2,864,722 2,675,149 189,572 4,209

January 01, 2014

Assets Liabilities Equity

Income for the Period

Balances according to IFRS reported by the subsidiary COP 2,015,900 1,883,134 132,766 0 Standardization adjustments (1) (3,941) (942) (2,999) 0 Balances based on the technical regulatory framework applicable to the Bank for the preparation of consolidated financial statements

COP 2,011,959 1,882,192 129,767 0

(1) These are the adjustments of investments and loan provisions.

(Continued)

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iii. Investments in Associates and Joint Ventures

Investments in Associates Investments in associates (entities over which there is significant influence, but no control). It is understood that there is significant influence over another entity if there is directly or indirectly 20% or more of the power to vote in the investee, unless it can be clearly demonstrated that said influence does not exist. These investments are recorded using the equity method and they are periodically adjusted for changes in the investor's share in the net assets of the investee. The investor’s participation in the statement of income of the investee is included in the investor’s statement of income, and its share the investee’s other comprehensive income is included in the investor’s other comprehensive income. Joint Agreements A joint agreement is that by which two or more parties maintain joint control in the distribution of control decided in the agreement. That is to say, only when decisions on relevant activities require the unanimous consent of the parties that share control.

IFRS 11 classifies joint agreements into: joint operations and joint ventures, depending on the contractual rights and obligations of each investor.

In joint operations, the parties that have joint control of the agreement are entitled to the assets and obligations with respect to the liabilities related to the agreement. In joint ventures, the parties that have control of the agreement are entitled to the net assets of the agreement. Joint operations are included in the Group's separate financial statements based on its proportional and contractual share of each of the assets, liabilities, income and expenses according to the terms of the agreement.

The Group's joint ventures are recorded using the equity method in the same way as the investments in associates described in the previous paragraph.

e) Presentation of Financial Statements The accompanying financial statements are presented with the following aspects in mind:

i. Statement of Financial Position The statement of financial position is presented to show the different asset and liability accounts arranged according to their liquidity, considering that, for a financial entity, this form of presentation provides more relevant reliable information. Accordingly, each of the financial assets and liabilities notes reveals the amount expected to be collected or paid within twelve months and after the next twelve months.

ii. Statement of Income of the Period and Other Comprehensive Income These statements are presented separately as permitted by IAS 1 "Presentation of Financial Statements". In addition, the statement of income is presented based on the nature of expenses, which is the most common model in financial entities as it provides more reliable and relevant information.

(Continued)

11



iii. Statement of Cash Flow

Statements of cash flow are presented using the indirect method by which operating activities are first presented, reporting net earnings. This amount is then adjusted to account for the effect of non-monetary transactions for all types of accruals that do not generate cash flows. Likewise, it is modified for the effect of entries of results classified as investments or financing. Interest income and expenses are presented as components of operating activities.

f) Transactions in Foreign Currency

Transactions in foreign currency are translated into Colombian Pesos using the prevailing exchange rate on the date of the transaction. Monetary assets and liabilities in foreign currencies are translated into the reporting currency using the prevailing exchange rate on the cutoff date for the statement of financial position and non-monetary assets in foreign currency are measured at the historical exchange rate. Profit or loss resulting from the translation affect the statement of income. At June 30, 2015 and December 31, 2014, the rates were COP 2,598.68 in pesos and COP 2,392.46 in pesos, respectively.

g) Cash and Cash Equivalents

Cash and cash equivalents include cash, bank deposits, and other short-term investments in active markets with maturity in three months or less, following the date of acquisition. For a financial investment to qualify as a cash equivalent, it must fulfill the short-term payment commitments, as well as for investment purposes or similar; be easily translated into a specific amount of cash; and be subject to an insignificant risk of changes in value.

h) Financial Assets

The Group recognizes its financial assets and liabilities when it becomes one of the parties of the agreement that generates the financial asset or liability.

All financial assets are recognized initially more or less at fair value, in the case of financial assets that are not recorded at fair value through profit or loss, transaction costs directly attributable to the acquisition.

Regular investment purchases and sales are recognized on the procurement date, on which the Bank or its controlled companies agree to purchase or sell the asset. Financial assets at fair value with an impact on income are initially recorded at fair value and transaction costs are recorded in expenditure when incurred.

Financial assets classified at amortized cost are recorded in their acquisition or approval at transaction value in the case of investments or nominal value in the case of loan portfolio that, unless there is evidence otherwise, match the fair value thereof, plus the transaction costs directly attributable to their acquisition or approval, minus the commissions received.

If the fair value of a financial asset in the initial recording is different from the transaction price, the difference between fair value and the transaction price is recorded as a gain or loss. This is the case of the mandatory investments to be made by the entities in Class A and B Agricultural Development Securities.

(Continued)

12



The Group's financial assets include cash and short-term placements, loan portfolios and capital lease transactions, investments in debt securities, commercial debtors and other accounts receivable in debt and equity securities in listed and non-listed companies and derivative transactions.

i. Financial Investment Assets

Financial investment assets are classified as measured later at amortized cost or fair value based on the:

• Business model of the entity to manage the portfolios. • Characteristics of contractual cash flow.

According to the Group's business model, a financial asset is classified as measured at amortized cost if the following two conditions are met: • The asset is held in a business model whose objective is to hold onto the assets to obtain the

contractual cash flows. • The contractual conditions of the financial asset give rise, on specific dates, to cash flows that are only

payments of principal and interest on the amount of principal pending payment. Any other financial assets that do not meet the conditions aforementioned are classified as measured at fair value.

Following the initial recording, all financial assets classified "at fair value in the statement of income" are measured at fair value". The net income resulting from changes in fair value are presented as net in the statement of income in the account "net changes in financial assets of financial debt assets". In turn, for financial assets classified as "at amortized cost", following initial recording, reimbursements of principal, plus or minus accumulated amortization (calculated using the effective interest rate method) of any difference between the initial amount and the reimbursement value upon maturity and minus any decrease due to impairment loss are adjusted by crediting the statement of income. Income from dividends on financial assets in equity instruments is recognized in the statement of income, in the net income account in equity instruments, when it is established that the Bank is entitled to receiving payment thereof, regardless of the decision made to record the variations in fair value. Financial assets other than investments in associates and joint ventures, both in debt instruments and in equity instruments measured at fair value, are classified according to the Group's policies and business models with respect to these instruments, also considering the option provided by the International Financial Reporting Standards "IFRS 9" of the equity instruments between: • Measured at fair value through profit or loss, when considered trading securities. • Measured at fair value through other comprehensive income, when considered strategic and there is no

intention of sale in the short-term.

The classification of assets measured at fair value through profit or loss and the designation of investments in equity instruments as measured at fair value through other comprehensive income was determined based on the events and circumstances on the date of transition to IFRS.

The Group values most of its investments using the information provided by the INFOVALMER S.A. pricing service. The service provides input for the valuation of investments (prices, rates, curves, margins, etc.), and has methods for the valuation of approved investments in accordance with Decree 2555 / 2010, as well as the instructions provided in the Basic Legal Bulletin of the Colombian Financial Superintendence.

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Estimating Fair Value According to IFRS 13 "Fair Value Measurement", fair value is the price that would be received on the sale of an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. Accordingly, the fair value measurements of the Group's financial investment assets are made as follows: • The information provided by the INFOVALMER S.A. pricing service for instruments whose valuation

input is published on a daily basis is used in accordance with approved investment valuation methods. • The fair value of financial assets that are not listed on an active market is determined using valuation

techniques. The Group uses a variety of methods and assumptions based on the existing market conditions of each reporting date. The valuation techniques include the use of recent comparable transactions in equal conditions, reference to other substantially equal instruments, discounted cash flow analysis, options price models and other valuation techniques that are commonly employed by market players, taking maximum advantage of market data and minimizing the use of non-observable data.

Impairment

According to IAS 39, the Group evaluates whether there is objective evidence at the end of the reporting period that a financial asset or a group thereof measured at amortized cost is impaired. Significant economic difficulties of the debtor, probability of the debtor filing for bankruptcy or financial restructuring and late payment are considered indicators of financial asset impairment.

ii) Loan Portfolio and Capital Lease Transactions

The loans granted under the various authorized categories are recorded. The resources used in the granting of the loans come from its own resources, the public in the form of deposits and other foreign and domestic funding sources. They are financial assets with fixed or determinable payments that are not listed on an active market and they are usually originated when loaning funds to a debtor. Loans are presented at principal value pending collection, minus unearned interest and commissions (if applicable) and impairment losses, except in the case of loans for which the fair value option has been chosen. Unearned interest and commissions are recorded as income during the life of the loans using the effective interest method. The following transactions are presented in the loan portfolio and capital leasing: - Customer loans, - Assets provided that are classified as capital leases according to the IAS 17, - Prepayments for purchasing assets to provide in the capital lease, - Assets for placement in the capital lease, - Imports in the course of assets to provide in the capital lease, - Interests receivable, - Employee loans, - Letters of credit for collateral, - Letters of credit for deferred payment, and - Payment on behalf of customers.

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The Group measures the following types of loans at amortized cost.

Type of Loan Amortization Term

Credit Card

• Term of enrollment in the Bank. • Average term of the payments in which use is deferred.

Considering that the term of the card must never be exceeded.

The cost begins to amortize once the credit card is activated, regardless of whether or not it is used.

Revolving Credit

During the limit period

Overdraft

During the limit period Loans in RVU, so that granting costs are in COP

During the credit period

Loans in foreign currency, so that granting costs are in COP

During the credit period

The costs to grant the loan are not calculated for the lines of credit that mature up to 6 months following the issue thereof. In rating the loan portfolio, four (4) categories are considered: Commercial Loans granted to individuals or legal entities for the development of organized business activities, other than the loans granted in the microcredit category. Consumer Loans that, regardless of their amount, are granted to individuals to finance the acquisition of consumer goods or the payment of services for non-commercial or business purposes, as opposed to those granted within the microcredit category. Mortgage Loans that, regardless of the amount, are granted to individuals, and are for the purchase of new or used housing, or for the construction of individual homes. Microcredit Loans made up of the active loan operations referred to in Article 39 of Law 590 / 2000, or the regulations that amend, replace or add to it, as well as those carried out with small businesses in which the main source of repayment of the borrowing comes from the income derived from their activities. The borrower's debt balance may not exceed one hundred and twenty (120) current minimum monthly legal salaries at the time of the approval of the respective asset loan operation. The debt balance is understood to be the amount of current borrowings for which the corresponding small business is responsible to the financial and other sectors. This balance is in the operator records database consulted by the respective creditor, excluding mortgages for home financing, and adding the value of the new borrowing.

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A micro-business is understood to be a unit of economic production, operated by individuals or legal entities in activities related to business, farming and livestock, industry, trade or services, whether rural or urban, whose workforce does not exceed ten (10) workers, and whose total assets are less than five hundred (500) current minimum monthly legal salaries. Accrual of Interest According to Paragraphs 29 and 30 of IAS 18, income from ordinary activities resulting from the third-party use of the entity's assets that produce interest, royalties or dividends are recorded according to the bases established in Paragraph 30, provided that:

a) The entity is likely to receive the economic benefits associated with the transaction. b) The amount of income from ordinary activities can be measured reliably. Income from ordinary activities is recorded according to the following:

Interest is recorded using the effective interest method. The effective interest method calculates the amortized cost of an asset and allocates the interest cost or income during the relevant period. The effective interest rate equals exactly the estimated future payments or cash received during the expected life of the financial instruments, or if appropriate, a shorter period, at the initial net book value of the asset. In order to calculate the effective interest rate, the cash flows are estimated considering all the contractual terms of the fine without considering future credit losses and considering the initial balance of the transaction or loan granted, the transaction costs and the premiums granted, minus commissions and discounts received that are an integral part of the effective rate.

From the legal standpoint, interests on late payments are agreed contractually and as such can be assimilated to variable interests incurred on account of debtor default. To this effect, these interests are incurred at the time that the contractual obligation to do so arises, regardless of future credit losses, as established by the definition of the effective interest rate. Therefore, this balance is part of the client's total debt, which is evaluated to determine the impairment using the procedures established to do so, either through individual or collective evaluation. Suspension of Accruals Interest is accrued when there are estimated future flows to be recovered, in line with the provisions set forth in Paragraph 29 of IAS 18, which calls for accrual whenever the entity is likely to receive the economic benefits associated with the transaction. In accordance with the above, the following applies: a) The accrual of interest is suspended on loans evaluated individually or collectively that are one

hundred percent provisioned, since there are no future flows to be recovered. b) For all other partially impaired loans, whether individually or collectively, interest will continue to be

accrued at the original rate of the loan, which in the case of loans evaluated individually for impairment, is the rate at which the discount of future flows expected to be recovered was made.

Impairment

According to IAS 39, the Bank and its controlled companies evaluate at the end of each period whether there is objective evidence at the end of the reporting period that a financial asset or a group thereof measured at amortized cost is impaired. Significant economic difficulties of the debtor, probability of the debtor filing for bankruptcy or financial restructuring and late payment are considered indicators showing that the financial asset is impaired.

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When there is objective evidence that there has been an impairment loss of the value in the loan portfolio at amortized cost, the amount of the loss is measured as the difference between the asset’s carrying value and the present value of estimated future cash flows (excluding future credit losses that have not been incurred), discounted with the original effective interest rate of the financial asset (that is, the effective interest rate computed at the time of the initial entry). The asset’s carrying value is reduced directly. The amount of the loss is recorded in the statement of income. To evaluate the impairment, the Group assesses the impaired loans considered significant individually; all other loans are evaluated collectively. Impairment of the Loan Portfolio Evaluated Individually To determine loan impairment loss, clients with balances greater than or equal to COP 2,000 have been defined as individually significant loans, at the consolidated level of all the Group's entities and for all credit risk concepts to which the client is exposed. They are considered impaired when, based on current or past events and information when analyzing the debt profile of each debtor, the collateral provided, the financial information and information from the credit reporting bureaus, it is likely that the Bank and/or subsidiaries cannot recover all the amounts due in the original contract, including the agreed interest and commissions. Impairment of the Loan Portfolio Evaluated Collectively

Loans that are not subject to individual analysis to evaluate impairment are included in a collective impairment analysis, regardless of whether they are in arrears or they are considered significant or not. This analysis determines the level of the losses incurred in the loan portfolio. The collective evaluation method comes from statistical analyses based on experience in losses observed in the portfolio of each entity and includes the following aspects:

• Segmentation of the portfolio in similar groups according to levels of loss and client and/or loan characteristics.

• PD (probability of default) estimates based on the occurrence of the loss event over a time horizon, which must consider the identification period for losses incurred.

• LGD (loss given default) estimates based on the recovery observed given a loss event. • LIP (loss identification period) estimates.

The value of money over time is taken into account in order to estimate recovery rates. Expected recovery flows are discounted at the interest rate of placement of the defaulted loans and, if the data of the original rates is not available, a discount rate related to the average placement rate is used as the best estimate. PD, LGD and LIP are defined by the areas of Credit Risk of each of the Group's entities and they are in charge of establishing the frequency and method for validation, calibration and revision of the parameters and the model. Four fundamental factors are taken into account to quantify the losses incurred: exposure, probability of default, the loss identification period and severity. • Exposure at default (EAD) is the amount of risk incurred at the time of counterparty default.

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• Probability of default (PD) is the possibility that the counterparty will default on its obligations to pay capital and/or interests. The probability of default is associated with the rating/scoring or the level of default of each counterparty/transaction.

• The loss identification period (LIP) parameter, refers to the time elapsed between the occurrence of the event that generates a certain loss and the time that the loss becomes clearly evident on the individual level. LIPs are analyzed based on similar risk loans.

• In the specific case of the defaulted loan, the PD assigned is 100%. A loan is rated as "bad debt" when there is a default greater than or equal to 90 days, as well as the cases in which, without a default, there are doubts regarding the counterparty's solvency (subjective bad debt).

• Severity (loss given default - LGD) is the estimated loss in the event of default. It depends mainly on the characteristics of the counterparty and the valuation of the collateral associated with the transaction.

Accounts Receivable and Loan Portfolio Charge-offs A loan or account receivable is subject to charge-off by crediting impairment for loan portfolios or accounts receivable, respectively, when all possible collection mechanisms have been exhausted and it is considered non-recoverable. The Board of Directors defines periodic dates for the authorization of charge-offs. The recovery of financial assets previously charged off is recorded in the statement of income. Restructured Loans with Collection Issues Loan restructuring is understood as any exceptional mechanism implemented through the execution of any legal transaction to alter the originally agreed conditions, in order to appropriately address the debtor's obligation before the real or potential impairment of its ability to pay. Restructured loans are recorded at the time of restructuring at the present value of the expected future cash flows provided in the agreement, discounted at the original rate of the asset before restructuring. Transfers and Retirements The accounting treatment of transfers is conditioned by the way in which the risks and rewards associated with the assets are transferred; so financial assets are only retired from the consolidated balance sheet when the cash flows generated have been extinguished or when the implicit risks and rewards have been substantially transferred to third parties. In the latter case, the transferred financial asset is retired from the consolidated balance sheet, while recognizing any right or obligation retained or created as a result of the transfer is recognized. It is understood that the Group has substantially transferred the risks and rewards when the risks and rewards transferred represent most of the total risks and rewards of the transferred assets. If the risks and/or rewards associated with the transferred financial asset are substantially retained: • The transferred financial asset is not retired from the consolidated balance sheet and it will continue to

be valued using the same criteria as before the transfer. • An associated financial liability is recorded in an amount equal to the compensation received, which is

later valued at amortized cost. • Both the revenue associated with the transferred financial assets (that has not been retired) and the

expenses associated with the new financial liability will continue to be recorded.

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Offsetting Financial Instruments on the Balance Sheet Financial assets and liabilities are offset and the net amount is recorded in the statement of financial position, when there is the legal right to offset the recognized amounts and the Group intends to settle them on a net basis or to realize the asset and settle the liability at the same time.

iii) Operation with Derivative Financial Instruments

According to International Accounting Standard "IAS 9" "Financial Instruments", a derivative is a financial instrument or other contract whose value changes over time in response to changes in a denominated underlying variable (a specific interest rate, the price of a financial instrument or a listed raw material, a foreign currency exchange rate, etc.); it does not require an initial net investment or it requires a smaller investment than would be required for another type of contract in which a similar response could be expected in the event of changes in market conditions; and it will be settled at a future date. In the development of its operations, the Group generally trades in financial markets with trading financial instruments like forward contracts, future contracts, swaps, options and spot transactions and forward hedge contracts that fulfill the definition of a derivative. All of the derivative operations are registered at the time of the initial transaction for their fair value. Former changes in the fair value are adjusted with the charge or payment to the statement of income, according to the case, unless the derived instrument is designated as a hedge instrument and, if so, it will depend on the hedged item.

i) Hedge Accounting The Group designates hedging derivatives as: Fair Value Hedging When a derivative instrument is designated as fair value hedging of recognized assets or liabilities or firm commitments, changes in the fair value thereof are recorded in the statement of income along with any changes in the fair value of the asset, liability or firm commitment attributable to the hedged risk.

Cash Flow Hedging When a derivative instrument is designated as a cash flow hedge, of a particular risk associated with a recognized asset or liability or a highly probable projected transaction, the effective portion of the changes in fair value of the derivatives is recorded in the other comprehensive income account in equity. Hedging of Net Investments in Foreign Currency The hedging of a net investment in foreign currency is recorded similarly to cash flow hedging: the part of the gain or loss of the hedging instrument that determines effective hedging is recorded in other comprehensive income, while the ineffective part is recorded in the statement of income. The hedging instrument's gains or losses accumulated in equity will be reclassified in the statement of income at the time of total or partial disposal of the business abroad. At the start of the transaction, the Group documents the relationship between the hedge instrument and the hedged item, as well as the objective and the risk management strategy to undertake the hedging. The Group also documents its evaluation, on the start date of the transaction as well as on a recurring basis, that the hedging relationship is highly effective in offsetting the changes in fair value or the cash flow of the hedged items.

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Financial assets and liabilities from transactions with derivatives are not offset in the statement of financial position. However, when there is the legal and exercisable right to offset the recorded values and there is an intention to settle on a net basis or to realize the assets and settle the liability at the same time, they are presented as net values in the statement of financial position. The accumulated amount in equity is kept in other comprehensive income and reclassified in the statement of income in the same period in which the hedged item affects income. If the hedging instrument no longer meets the hedge accounting criteria, expires or is sold, or it is suspended or executed, or the designation is revoked, the hedge accounting is interrupted prospectively. If the intended transaction is no longer expected to occur, the balance recorded in equity is reclassified immediately in the consolidated statement of income.

j) Noncurrent Assets Held for Sale Foreclosed Assets and noncurrent assets held for sale that the Group intends to sell in a term of no more than one year, and whose sale is considered highly likely, are recorded as "noncurrent assets held for sale". These assets are recorded at the lower value between their book value at the time of transfer to this account or their fair value minus estimated cost of disposal. Depreciation and Impairment The Group does not depreciate (or amortize) a noncurrent asset while it is classified as held for sale, or while it is part of a group of assets for disposal classified as held for sale. However, it shall continue to recognize interest, as well as other expenses attributable to the liabilities of a group of assets for their disposal that has been classified as held for sale. The Group recognizes impairment losses due to initial or subsequent reductions in the asset's value (or group of assets for disposal) in the statement of income for up to the fair value minus cost of disposal. The Group recognizes gains due to subsequent increases resulting from fair value measurement minus the costs of disposal of an asset, without exceeding the recognized impairment loss. The costs related to the maintenance of these properties are included as expenses as they are incurred.

k) Investment Properties According to International Accounting Standard (IAS) 40 on Investment Properties, investment properties are defined as land, buildings, part of a building or both, held by the Bank to obtain rent, valuation of the asset, or both, rather than for its own use. Investment properties are initially measured at cost, which includes: a) Their purchase price, including import costs and non-deductible taxes, after deducting commercial

discounts. b) Any cost directly attributable to bringing the asset to the location and the necessary conditions for its

correct and appropriate operation.

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Some assets may have been acquired in exchange for one or more non-monetary assets. In these cases, the cost of said assets shall be measured at their fair value, unless:

a) The exchange transaction is not of a commercial nature. b) The fair value of the received or delivered asset cannot be reliably measured. If the asset is classified as investment property and acquired with capital lease, the initial cost corresponds to the lower value between the fair value and the present value of the minimum lease payments in accordance with International Accounting Standard "IAS 17". Cost recognition ceases when the item is at the location and in the condition necessary for its operation. The Group selected the cost model for subsequent measurement, applying the requisites established in the property, plant and equipment policy. Depreciation and Impairment The depreciation and impairment calculation of investment properties is made in accordance with the guidelines established in the property, plant and equipment policy.

l) Property, Plant and Equipment Property, plant and equipment include own assets or those received under capital lease, held by the Group for current or future use and are expected to be used for more than one year. They are recorded in the balance sheet at their acquisition cost minus their corresponding accumulated depreciation, and if applicable, the estimated losses from comparing the net accounting value of each entry with its corresponding recoverable amount. Their depreciation is calculated by applying the straight-line method on the cost of assets minus the residual value thereof. The land on which buildings and other constructions are built have an indefinite useful life; therefore, they are not subject to depreciation. This depreciation is charged to income and it is calculated based on the following useful lives:

Category Useful life Buildings: Foundations - structure and cover 50 to 70 years Walls and divisions 20 to 30 years Finishes 10 to 20 years Machinery and equipment 5 to 25 Years Vehicles 5 to 10 years Office equipment and furniture 3 to 10 years Medium and high-capacity equipment: Power Plant > 40 KW / UPS > 30 kVA / Air Conditioning > 15 T.R. 10 to 12 years

Electricity generator/UPS/Air conditioning in buildings 5 to 10 years Computers PC / Laptops / Mobile Devices 3 to 7 years Servers 3 to 5 years Communications equipment 5 to 8 years Specific amplification equipment 5 to 7 years ATMs 5 to 10 years

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Category Useful life Leasehold improvements 3 to 5 years Gas pipelines, networks and lines 75 years Compressors 8 to 35 years

The useful life and residual value of these assets is based on independent assessments, mainly for buildings, or on the opinions of other specialized staff, and are reviewed at least at the end of each period. The maintenance and upkeep expenses of property and equipment are recorded in the other expenses item as an expense in the period in which they are incurred. Property, plant and equipment are initially measured at cost, which includes: a) The purchase price, including import costs and non-deductible taxes, after deducting commercial

discounts. b) Any cost directly attributable to bringing the asset to the location and the necessary conditions for its

correct and appropriate operation. c) Decommissioning costs: the initial estimate of costs of disassembly and removal of the element, as

well as recovery of the place where it was located. d) Loan costs: Costs that are related to a suitable asset (one that necessarily requires a substantial

period before being ready for its intended use or sale) are capitalized. In the other cases, they are recorded in the statement of income in agreement with the financing costs.

The Group decided to separate buildings into components, as follows:

Type of Building

COMPONENTS / INCIDENCE # 1 # 2 # 3 Foundations - structure

and cover Walls and

divisions Finishes

Commercial buildings 30%

18%

52% Commercial premises

Office buildings Hotels Warehouses 44% 23% 33% Industrial warehouses

Retirement from Accounts The book value of a property, plant and equipment item is written-off when no further associated future economic benefits are expected. The gain or loss of the write-off is recorded in the statement of income. Impairment of Property, Plant and Equipment Items When closing an accounting period, the Group analyzes whether there are any internal or external indications that an asset is impaired. If there is evidence of impairment, the entity analyzes whether said impairment really exists by comparing the net asset book value with its recoverable amount (the greater of the fair value minus the costs of owning the asset and its value in use). When the book value exceeds the recoverable amount, is adjusted to the recoverable amount, modifying future depreciation charges to bring them in line with the new remaining useful life.

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Additionally, when there are indications that the value of a material asset has been recovered, the Group estimates the recoverable amount of the asset. It is then recorded in the statement of income for the period, including the reversal of the loss from impairment recorded in previous periods, and consequently, the future charges for depreciation are adjusted. In no event may the reversal of an asset's impairment loss result in an increase of its book value above that of the value of the asset, if impairment losses had not been recorded in previous periods.

m) Assets Leased Assets provided by the Group on Lease are classified at the time the agreement is signed as capital or operating leases. A lease is classified as a capital lease when all of the property's advantages and risks are substantially transferred. A lease is classified as an operating lease if all of the property's advantages and risks are not substantially transferred. Lease agreements that are classified as capital leases are included in the balance sheet in the "loan portfolio and capital leases" item, and they are recorded in the same way as other loans granted. Lease agreements classified as operating leases are included in the property, plant and equipment account and they are recorded and depreciated in the same way as this kind of asset.

n) Assets Received on Lease When initially recognized, assets received on lease are classified as capital or operating leases in the same way as assets leased described in the previous section. Lease agreements classified as capital leases are included in the balance sheet as property, plant and equipment for own use or as investment properties, as applicable. They are initially recorded at the same time in assets and liabilities for a value equal to the fair value of the asset received on lease or the present value of the minimum lease payments, whichever is lower. The present value of the minimum lease payments is established using the interest rate implicit in the lease agreement, and if it does not contain the rate, the average interest rate of the bonds placed by the Group on the market. Any initial direct cost of the lessee is added to the amount recorded as assets. The value recorded as liabilities is included in the financial liabilities account and is recorded accordingly. Payments recorded as operating leases are linearly recorded in income during the term of the lease. The incentives of received leases are recorded as an integral part of total leasing expenses during its term.

o) Biological Assets

In accordance with International Accounting Standard (IAS) 41 on "Agriculture", agricultural activities related to biological assets (animals or plants) are recorded separately in this account, at the time of initial recognition as well as at the end of the reporting period, at fair value minus cost of disposal, except in the case of crops in the period of growth, when for some reason their fair value cannot be measured reliably. In this case, they are measured at cost minus any accumulated impairment loss, or for short-term crops in which their fair value minus cost of sale are reflected in the statement of income by their sale. The gains or losses arising in the initial and subsequent recognition at fair value of agricultural products are included in the net gain or loss of the accounting period. Costs incurred in the agricultural production process are also taken directly to the statement of income.

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p) Government Subsidies A government subsidy related to a biological asset measured at fair value minus cost of disposal is recognized in the income of the accounting period, when the subsidy becomes payable.

If a government subsidy is conditioned, i.e., it includes situations in which, certain agricultural activities cannot be undertaken during the subsidy, or any other condition, the government subsidy is recognized in the statement of income for the accounting period in which the conditions linked thereto were met.

q) Intangible Assets

i. Capital Gains

According to IAS 39 on "Intangible Assets", capital gains are considered to have an indefinite useful life and they are not amortized. However, they are subject to annual impairment assessment, and whenever there are signs that one of the groups of cash generating units to which the capital gains were distributed may have been impaired. In this case, the Group carries out a valuation using an independent expert in its different lines of business. Based on this valuation, it is determined whether or not there is any impairment. If there is, it is charged to income. Once an impairment loss has been recognized, it cannot be reversed in subsequent periods.

ii. Other Intangible Assets These are primarily computer programs and licenses which are initially measured by the acquisition cost incurred or the cost of the internal development phase. Costs incurred in the research phase are taken directly to income. Following initial recognition, these assets are measured based on the cost model and amortized during their estimated useful life, which is 3 to 10 years in the case of computer programs and 10 years for licenses. Amortization is recognized on a straight line basis according to estimated useful life. Impairment At the close of each accounting period, the Group analyzes whether or not there are external or internal signs of impairment, and in these cases, it follows the accounting policy similar to that of property, plant and equipment, to determine whether the recognition of an impairment loss may be applicable. Impairment losses and subsequent reversions are recognized in net income.

r) Concession Agreements

The concession agreements in which the Group, through its subsidiaries involved in the infrastructure, energy and gas sector, agrees to the construction or maintenance of infrastructure works for the Colombian Government during a specific period, and in which said companies receive revenue for the duration of the agreement, either through direct contributions from the Government or by means of fees charged to users, according to accounting interpretation IFRIC 12 Service Concession Agreements, they are recorded either as financial assets or as intangible assets. A financial asset is recognized when, according to the conditions of the agreement, there is an unconditional contractual right to receive from the grantor or the Colombian State, cash or another financial asset for the construction services provided.

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An intangible asset is recognized when there is no unconditional right in the concession agreement to receive cash, and revenue is conditioned to the degree of the public's use of the service provided by the asset under concession. In some cases, there may be mixed agreements in which one part of the agreement is a financial asset or another part is an intangible asset.

Accordingly, the rights in concession agreements are recorded as follows:

i. During the construction stage of the work under concession, according to International Accounting Standard IAS 11 on "Construction Agreements", all estimated revenue from the construction and costs associated with the construction are recorded in the statement of income with reference to the stage of completion of the project at the end of the period, based on the work in progress method. Any expected additional losses are recorded immediately as an expense.

ii. If the concession agreement is classified as a financial asset, the asset that arises in the agreement is included in the "concessioned financial assets" account and recorded at present value of the future payments to which the Group is entitled, through its subsidiaries, discounted using the effective interest rate. If the financial assets are related to the obligation to sell at the end of the agreement at fair price, these financial assets are designated at fair value through profit or loss.

iii. If the concession agreement is classified as an intangible asset, the accumulated revenue accrued as an asset during the construction stage of the project is recorded as intangible assets and amortized in the statement of income as of the date on which the construction is completed and the corresponding asset is placed at the service of its users, for the duration of the concession agreement. Revenue received on account of tolls or fees, once the construction is completed and placed at the service of the public, it is recorded when actually received. (See Note 20).

s) Inventories

Inventories are assets to be held for sale during the ordinary course of business, are in the production process for sale and/or are in the form of materials or supplies to be used in the production process or the provision of services. For recognition, inventories are measured using the cost method and the weighted average method or the net realizable value method, whichever is lower. The cost of inventories comprises acquisition costs, transformation costs and the costs incurred to take stock to its current location and condition.

t) Financial Collateral It is an agreement that requires the issuer to make specific payments to reimburse the creditor for losses incurred when a specific debtor fails to meet its payment obligation in accordance with the original or amended terms of a debt instrument, regardless of its legal structure. Financial collateral can take on various forms, including bonds and sureties. In its initial recognition, the financial collateral provided is recorded as a liability at a fair value, which is generally the current value of commissions and returns to be earned over the life of the agreements, whose balancing entry in assets is the amount of the commissions and returns charged at the start-up of operations and accounts receivable for the current value of the future cash flows pending receipt.

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Financial collateral, regardless of the guarantor, instrumentation or other circumstances, is periodically analyzed in order to determine the credit risk to which it is exposed, and if applicable, to estimate the need to constitute a related provision, which is determined by applying criteria similar to those set forth to quantify the impairment losses of financial assets. Allowances constituted for financial collateral agreements that are considered impaired are reported in the liability as "Allowances - Allowances for contingent risks and commitments" and charged to the earnings for the period. Income obtained from guarantee instruments is reported in the income from commissions account of the earnings for the period.

u) Financial liabilities A financial liability is a contractual obligation of the Group to pay cash or other financial asset to an entity or person, or to exchange financial assets or financial liabilities under conditions that are potentially unfavorable to the Group. It is also an agreement that can or will be settled utilizing equity instruments owned by the entity. Financial liabilities are initially recognized at fair value minus, in the case of outstanding investment securities and bonds in foreign currency, the transaction costs directly attributable thereto, in the applicable cases of outstanding investment securities and bonds in foreign currency. The transaction costs associated with obtaining financial liabilities measured at amortized cost classified as incremental costs are recorded as a deduction from liabilities and the effective interest rate, based on which the corresponding financial expenditures are recorded in the income of the accounting period, except when they have been designated as hedging instruments, in which case the corresponding accounting policy is applied. (See Note 24). The Group's financial liabilities include deposits and borrowings, derivative financial instruments, commercial accounts payable and other accounts payable and financial collateral agreements.

The subsequent measurement of financial liabilities depends on their classification, as follows: Deposits and Borrowings Following initial recognition, deposits and borrowings that accrue interest are measured at amortized cost using the effective interest rate method. Net income is recognized in the statement of income when liabilities are retired, as well as through the amortization process using the effective interest rate method. The amortized cost is calculated taking into account any discount or premium in the acquisition and the commissions or costs that are an integral part of the effective interest rate. The accrual of the effective interest rate is recognized as a financial cost in the statement of income. Retirement from Accounts Financial liabilities are retired when the obligation indicated in the corresponding agreement has been paid, canceled, or has expired. When an existing financial liability is replaced by another from the same lender under substantially different conditions, or if the conditions of an existing liability are amended substantially, the swap or amendment is treated as a retirement of the original liability and the recognition of a new liability, and the difference in the respective amounts is recognized in the statement of income.

(Continued)

26



v) Employee Benefits

Pursuant to International Accounting Standard IAS 19 "Employee Benefits", the Group recognizes all forms of compensation paid to employees in exchange for their services. These benefits are divided into three types:

i. Short-term Benefits In line with Colombian labor law, these benefits include severance pay, interest on severance pay, annual leave, vacation bonus, legally required and discretionary service bonuses, assistance and payroll taxes, which are all paid within 12 months of the period close. These benefits are recognized in an accrual accounting system and are charged to the statement of income.

ii. Post-employment Benefits Benefits, other than severance pay, paid by the Group to its employees at the time of retirement or following termination of their employment. In line with Colombian labor law, these benefits correspond to retirement pensions paid directly by the Group, and other bonuses granted to employees subject to certain requirements at the end of their period of employment. The liability for post-employment benefits of the contribution schedules defined (payments made by the Group to pension management funds) is measured on a base amount without deduction, and is recorded using the accrual accounting system against income. The contributions schedules defined do not require the use of actuarial assumptions to measure the liability or the expense, therefore they do not generate actuarial gain or loss. The liability for post-employment benefits of the defined benefit schedules is determined by the present value of estimated future payments to employees, calculated on actuarial studies prepared by the projected unit credit method. To this end, it uses actuarial assumptions of mortality rates, salary increases, staff turnover and interest rates determined by prevailing bond market returns at the close of the National Government's issue or high-quality corporate bonds. Under the projected unit credit method, future benefits to be paid to employees are assigned to each accounting period in which the employee provides the service. Therefore, the cost of these benefits is reported in the Group's statement of income, including the cost of the present service assigned in the actuarial calculation plus the calculated financial cost of the liability. Variations on the liability due to changes in actuarial assumptions are reported in the equity in other comprehensive income. Variations in actuarial liabilities caused by changes in employment benefits given to employees and applied retroactively are reported as expenditures on the following dates, whichever comes first: • When the modification to the employment benefits occurs. • When the allowances for restructuring costs by a Group subsidiary or business are recorded.

iii. Other Long-term Benefits

Pursuant to collective bargaining and the Group's regulations, these benefits primarily correspond to seniority bonuses and severance fees for employees hired prior to Law 50 / 1990.

(Continued)

27



Other liabilities for long-term benefits are determined in the same manner as the post-employment benefits described in (b) above. The only difference is that changes in actuarial liabilities due to actuarial budget changes are also reported in the statement of income.

iv. Benefits for Termination of Employment Contract These benefits are payments that the Group is required to make due to a unilateral decision to terminate the contract, or a decision by the employee to accept an offer from the Group in exchange for terminating the contract of employment. Termination benefits are recorded as a liability charged to income on the following dates, whichever comes first: • Upon formal notification to the employee of the Company's/Group's decision to terminate the contract. • When allowances for restructuring costs by a Group subsidiary or business involving the payment of

termination benefits are recorded.

w) Business Combination In line with IFRS 3 "Business Combinations", transactions or other events in which the Group obtains control of one or more businesses, are recorded in the consolidated financial statements using the purchase method. Based on this method, the acquisition price is distributed among the identifiable assets acquired, including any intangible asset and liability assumed and including contingent liabilities, at their respective fair values, with some exceptions such as the deferred tax, which is measured at book value. When noncontrolling interests remain in the acquisition of control of the business, they are recorded, at the option of the Group at favor value, or at the proportional share of the current ownership instruments, in the amounts recognized in the identifiable net assets acquired. The difference between the price paid plus the value of the noncontrolling interest and the net value of the assets and liabilities required, determined as indicated earlier in this paragraph, is recorded as capital gains. After that, the capital gains recorded are not amortized and they are subject to annual assessment for impairment. In addition, the accounts on the acquired business' statement of income in the consolidated financial statements are included only following the date on which control is actually acquired.

x) Taxes

i. Income tax Income tax expense includes the current tax, the income tax for equality (CREE) and deferred income tax. It is recognized in the statement of income except for the part corresponding to the items recognized in other comprehensive income. In this case, the tax is also recognized in that condition. Current Tax Current tax includes tax expected to be paid or received on the taxable earnings of the year, and any adjustment related to previous years. Current income tax and the CREE income tax for equality are calculated using the approved tax rates, or those whose process of approval is completed on the balance sheet date in the countries where the Parent Company and its subsidiaries operate. The current tax also includes any tax on dividends.

(Continued)

28



Deferred Tax Deferred taxes are recognized based on temporary differences between the tax bases of the assets and liabilities and the amounts recognized in the consolidated financial statements, which result in amounts that are deductible or taxable when there are fiscal gains or losses corresponding to future periods when the asset’s carrying value is recovered or the liability is settled. However, deferred tax liabilities are not recognized if they are generated by the initial recognition of capital gain. A deferred tax is not accounted for if it results from the initial recognition of an asset or liability in a transaction other than a business combination that, at the time of the transaction, does not affect accounting or tax gain or loss. Deferred tax is calculated using the tax rates in force on the balance sheet date and are expected to apply when the deferred tax asset is realized or when the deferred tax liability is paid. Deferred tax assets are only recognized when future tax income will likely be available against which temporary differences can be deducted. Deferred tax liabilities are allowances to cover temporary taxable differences. The only exception is for deferred tax liabilities associated with investments in subsidiaries, associates and joint ventures, when the possibility to reverse the temporary difference is controlled by the Group, and will not likely be reversed in the near future. The Group does not usually have the ability to reverse temporary differences of investments in associates. Deferred tax assets and liabilities are offset when there is a legal right to offset the current deferred income tax assets against current income tax liabilities and when the deferred income tax asset and liability are for income taxed by the same tax authority on the same entity or on different entities when there is a clear intention to offset balances for the net tax bases.

ii. Wealth Tax In December 2014, the Colombian Government issued Law 1739, which created the wealth tax to be paid by all entities in Colombia with a liquid equity greater than COP 1,000, which is settled as described in Note 21 below. This law stipulates that for accounting purposes in Colombia, the tax is accrued at January 1, 2015 to 2018 and can be recorded in equity reserves within equity. The Group has chosen to apply this exception and has recorded the wealth tax, applicable to the year 2015 in its equity reserves account, except in the case of Fiduciaria Bogotá and Almaviva where it affected income.

y) Allowances and Contingencies An allowance is recorded if it is the result of a past event, the Group has a present obligation (either legal or implicit) that can be estimated in a reliable manner, and may require an outflow of resources that include economic benefits to settle said obligation. The amount of the allowance is determined using the best estimate, and when it is expected to be settled in the long term, it is deducted at present value. Every allowance must be used only to deal with the disbursements for which it was originally recorded. If the entity has an onerous contract, present obligations deriving therefrom must be recorded and measured on the financial statements as allowances.

(Continued)

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Allowances are periodically updated at least at the closing date of each period, and are adjusted to reflect the best estimate possible at every moment. Update on allowances to reflect the passage of time is recorded in the income for the period as financial expenditures. In the event that an outflow of resources is no longer probable, the allowance shall be reversed to settle the corresponding obligation. In the event of changes to the estimates, these shall be recorded prospectively as changes in the accounting estimate, pursuant to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors.

z) Income Income is measured by the reasonable value of the compensation received or to be received, and represents amounts to be collected for goods delivered, net discounts and returns. The Group recognizes income when their amount can be reliably measured, when it is probable that future economic benefits will flow to the entity and when specific recognition criteria have been met for each of the Group's activities.

i. Provision of Services The Group provides a variety of services. Income for providing services is recorded in the accounting period in which the services were provided, by reference to the termination stage of the specific transaction, and evaluated on the basis of the real service provided as a proportion of the total services provided. When services are provided through an unspecified number of actions during a specific period of time, income from ordinary activities is recorded on a straight-line basis throughout the stipulated period.

ii. Customer Loyalty Programs The Group operates customer loyalty programs in which customers accumulate points for purchases made and they can redeem reward points in accordance with the policies and rewards plan in effect at the time of redemption. Points for rewards are recorded as an identifiable component separate from the initial sale transaction, assigning the fair value of the compensation received from the rewards points and other sale components in a way that the loyalty points are initially recorded as deferred income at its fair value. The income from the reward points is recorded in the income of the period when they were redeemed.

iii. Income from Commissions Commissions are recorded as income in the period's income statement as follows: a) Commissions for banking services when the respective services are provided. b) Credit card commissions are recorded and amortized on a straight-line basis during the corresponding

period. c) Commissions incurred when new loans are issued are deferred and transferred to income during their

period of validity, net cost incurred, using the effective interest rate method.

4. New Accounting Standards Issued by the IASB for Global Application New accounting statements issued by the IASB for global application after January 1, 2013, are presented below. These, which are already in effect, or others that may be adopted internationally although they are not yet in effect, cannot be adopted in Colombia yet given that the statements issued in 2013 will go into effect on January 1, 2016, and those issued thereafter are not incorporated in the regulatory decrees of Law 1314 / 2009:

(Continued)

30



a) IFRS 9 - “Financial Instruments"

This new standard replaces the IAS 39, and it addresses the classification, measurement and recognition of financial assets and liabilities, financial asset impairment and hedge accounting. IFRS 9 requires financial assets to be classified in three measurement categories: amortized cost, fair value through other comprehensive income and fair value through profit or loss. Said classification is determined at initial recognition. It depends on the entity’s business model applied when managing financial instruments and the contractual characteristics for the instrument. As for financial liabilities, this standard maintains the majority of the requirements set forth in the IAS 39. Nevertheless, it includes the fair value due to own credit risks to be presented in other comprehensive earnings, rather than only through profit or loss. IFRS 9 incorporates requirements of impairment related with recognizing credit losses expected by the organization on its financial assets and its commitments to extend credit. Under this method, it is not necessary for a credit event to occur to recognize the losses associated with financial asset impairment. The organization always bases its analysis on expected credit losses. Impairment value is updated at the end of the year to reflect changes in credit risk since the initial recognition, providing timely information on credit impairments. Hedge accounting as defined in IFRS 9 includes additional requirements that better align it with risk management, establish a focus based on the principles of hedge accounting and address inconsistencies and weaknesses of the IAS 39 hedge accounting model. The Group is assessing the requirements of this standard on the global level, which also amends IFRS 9 in force for Colombia in order to determine the impact thereof on its financial standing when the statement is mandatory or allowed in Colombia.

b) Amendments to IFRS 11 – "Joint Agreements" New guides are included for accounting recognition of the acquisition of a share in a joint operation, which indicates that the investor must apply accounting principles for business combinations pursuant to IFRS 3, provided that share constitutes a "business." These amendments shall be effective for annual periods beginning on or after January 1, 2016, and are effective for periods beginning on or after January 1, 2018; early application is allowed. The Group is currently analyzing the possible impact of amendments to the standard, and it does not expect a significant impact on its earnings for the period or financial standing when the statement is mandatory or allowed in Colombia.

c) Amendments to IFRS 13 – "Fair Value Measurement" IFRS 13 modifies the definition of fair value as the price that would be received to sell an asset or be paid to transfer a liability in an orderly transaction between market participants on the measurement date. Therefore, fair value is an exit price, not the price of acquisition, and for that reason differences may arise in the initial value paid to acquire the assets or assume liabilities and their fair value.

(Continued)

31



According to IFRS 13, the fair value measurement of a non-financial asset must consider the capacity of a market participant to generate benefits from the highest and best use of the asset or from the sale to another market participant that will benefit from its highest and best use. The highest and best use is that which would maximize the value of the asset or group of assets and liabilities with which the asset will be used. The highest and best use must be physically possible, legally permissible and financially viable. It must consider asset use from the market participants' point of view, regardless of how the organization plans to use the asset. Regarding liabilities and equity instruments, fair value measurement assumes the Company’s financial liability, non-financial liability or equity instrument is transferred to the market participant on the measurement date. The transfer assumes that: • A liability would remain outstanding and the market participant transferee would be required to fulfill

the obligation. • An equity instrument would remain outstanding and the market participant transferee would take on

the rights and responsibilities associated with the instrument. Even when there is no observable market to determine the price of the liability or equity instrument, there may be an observable market if said items are maintained by third parties as assets. If there is no quoted price for an identical or similar liability or equity instrument, but an identical entry is kept as an asset by third parties, the entity must determine the fair price from the perspective of the market participant who keeps an identical asset on the date of the valuation. This interpretation is applied to annual periods beginning on or after January 1, 2014. The Group is currently analyzing the possible impact of adopting these amendments to the standard, and no significant impact is expected on its earnings for the period or financial standing when the statement is mandatory or allowed in Colombia.

d) Amendments to IAS 36 - "Impairment of Assets" The amendment was issued in May 2013. As a consequential amendment to IFRS 13, the IASB modified IAS 36 requiring the entity to disclose additional information about impaired assets for which the recoverable amount is the fair value minus the cost of disposal. Accordingly, the Group must reveal the level of fair value hierarchy, the valuation techniques and the key assumptions used by management to determine fair value minus cost of disposal. Amendments to IAS 36 apply on a retrospective basis for annual periods beginning on or after January 1, 2014. The Group is currently analyzing the possible impact of adopting these amendments to the standard, and no significant impact is expected on its earnings for the period or financial standing when the statement is mandatory or allowed in Colombia.

e) IFRIC 21 - "Contributions" Issued in May 2013. It is an interpretation of IAS 37 "Allowances, contingent liabilities and contingent assets." IAS 37 establishes the criteria to record a liability, including the requirement by which the entity has the obligation as a result of a past event (known as obligation generating event). The interpretation makes it clear that the obligation generating event that results in a liability to pay a transaction tax is the continuity of the activity that produced the payment of the transaction tax in the period after the income of said activity was generated. Therefore, the generation of income in the previous period is necessary but not sufficient to create a present obligation. This interpretation is applied to annual periods beginning on or after January 1, 2014. The Group is currently analyzing the possible impact of adopting these amendments to the standard, and no significant impact is expected on its earnings for the period or financial standing when the statement is mandatory or allowed in Colombia.

(Continued)

32



f) IFRS 14 "Regulatory Deferral Accounts" IFRS 14, issued in January 2014 and effective for annual periods beginning on or after January 1, 2016, allows first-time adopters to continue to record amounts related to rates regulation in accordance with the requirements of its previous accounting principles when they adopt IFRS for the first time. However, to highlight the comparison with entities that already apply IFRS and do not recognize these amounts, the statement requires that for regulation purposes, rates must be submitted separately from other entries. An entity that already submits its financial statements under IFRS is not eligible to apply the standard.

g) Amendment to IAS 39 - "Financial Instruments: Recording and Measurement" Amendment issued in June 2013 stating that it is not necessary to stop hedge accounting if a hedge derivative has been replaced by a new one, as long as it meets certain criteria. Amendments to IAS 39 apply on a retrospective basis for annual periods beginning on or after January 1, 2014. The Group is currently analyzing the possible impact of adopting these amendments to the standard, and no significant impact is expected on its earnings for the period or financial standing when the statement is mandatory or allowed in Colombia.

h) IFRS 15 "Revenue from Contracts with Customers" IFRS 15 establishes a general framework to determine when an entity must report income that represent the transfer of goods or services offered to customers for a transaction price that the entity deems the customer will be entitled to receive in exchange. This standard is effective for annual periods beginning on or after January 1, 2017. Early adoption is allowed, and it can be applied retroactively. The Group is currently analyzing the possible impact of adopting this standard, and no significant impact is expected on its results from operations or financial standing when the statement is mandatory or allowed in Colombia.

i) Amendment to IAS 27 - "Separate Financial Statements" Issued in August 2014, this amendment allows controlling entities to use the equity method as an accounting option for recognizing investments in subsidiaries, associates and joint ventures in their individual financial statements. The amendment is effective for annual periods beginning on or after January 1, 2016, with earlier application being permitted and retrospective application. The Group is currently analyzing the possible impact of adopting this amendment on its financial standing when the statement is mandatory or allowed in Colombia.

j) Amendments to IAS 28 "Investments in Associates and Joint Ventures" and IFRS 10 "Consolidated Financial Statements" Issued in September 2014, this amendment resolved current inconsistencies between IFRS 10 and IAS 28 as regards the recognition of sales or contributions of non-monetary assets made by an investor to its associates or joint ventures. The gain or loss of a transaction will be recognized by the investor if the non-monetary assets transferred constitute a business as defined in IFRS 3 - Business Combinations. These amendments are effective for annual periods beginning on or after January 1, 2016, with earlier application being permitted and prospective application. The Group is currently analyzing the possible impact of adopting these amendments, and no significant impact is expected on its results from operations or financial standing when the statement is mandatory or allowed in Colombia.

(Continued)

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k) Amendment to IAS 32 - "Financial Instruments"

Amendments to IAS 32 (Offsetting Financial Assets and Financial Liabilities) were issued to provide clarification regarding the requirements to offset Financial Instruments. The purpose of the joint project between IASB and FASB was to address the differences in the respective accounting standards in elation to offsetting financial instruments. The project for the amendment of IAS 32 was focused on four primary areas: • The meaning of "currently has a legal right to offsetting" • The application and settlement of simultaneous implementation • The offsetting of the amounts of collateral • The account unit for the application of offsetting requirements.

Amendments to IAS 32 are not effective until the annual periods starting on January 1, 2014. However, the new requirements to disclose offsetting are effective before that - for the annual periods starting on or before January 1, 2013 and the intermediate periods during those annual periods.

5. Fair Value Estimate Fair value of financial assets and liabilities traded in active markets (such as financial assets in debt securities and equity securities and derivatives quoted actively in securities exchanges and interbank markets) is based on market prices quoted on the closing date of the period. In an active market, transactions for assets or liabilities are carried out with sufficient frequency and volume to provide information on prices continuously. The fair value of financial assets and liabilities that are not listed on an active market is determined using the valuation techniques defined by the pricing service or the Group. The valuation techniques used for non-standard financial instruments such as options, currency swaps and over-the-counter derivatives include the use of curves for the valuation of interest rates or currencies created by pricing services based on market data and extrapolated to specific conditions of the instrument being valued, discounted cash flow analysis, options price models and other assessment techniques commonly used by market players, taking maximum advantage of market data and minimizing the use of entity-specific data. The Group calculates the fair value of derivative instruments on a daily basis, using information on prices and/or input supplied by the designated official pricing service (INFOVALMER Proveedor de Precios para la Valoración S.A.). This provider has been authorized following compliance with standards applicable to valuation pricing service in Colombia, including its object, operating regulations, process to approve valuation methodologies, and required technological infrastructure, among others. After assessing the pricing service's methodologies (Infovalmer S.A.), it is concluded that the fair value calculated for derivative instruments based on prices and input supplied by the price vendor is adequate. The Group can use internally developed models for instruments that do not have active markets. These models are generally based on valuation methods and techniques that are standard in the financial sector. The valuation models are used primarily to assess equity financial instruments that are not listed on the stock market. Some data for these models are not observable in the market and therefore, they are estimated on the basis of assumptions.

(Continued)

34



A model's output is always an estimate or approximation of a value that cannot be accurately determined, and the valuation techniques used may not fully reflect all the factors affecting the Group's position. Therefore, valuations are adjusted as necessary to allow additional factors, including model risk, liquidity risk and counterparty risk. The fair value's hierarchy has the following levels: • Level 1 entries are quoted prices (without adjustment) in active markets for assets or liabilities identical

to those that the entity has access to on the date of measurement. • Level 2 entries are different from the quoted prices included in Level 1 that are observable directly or

indirectly for the assets or liabilities. • Level 3 entries are not observable for the assets or liabilities.

The level in the fair value hierarchy in which the fair value measurement is classified in its totality is determined on the basis of the entry of the lowest level that is significant to measure the total fair value. To that regard, the importance of an entry is assessed with relation to the measurement of the total fair value. If a fair value measurement uses observable entries that require significant adjustments based on non-observable entries, this measurement is a Level 3 measurement. The assessment of the importance of a particular entry to the measurement of the fair value in its totality requires judgment, considering specific factors of the asset or liability. Establishing what constitutes as "observable" requires a significant judgment by the Group. To the Group, observable data are the market data that are already available, which are regularly updated or distributed, reliable and verifiable, with no copyrights, and are supplied by independent sources that participate actively in the market in question. Fair Value Measurement on a Recurrent Basis It refers to measurements that IFRS accounting standards require or allow in the statement of financial position at the end of each accounting period. The table below lists the Group's assets and liabilities (by class), within the fair value hierarchy, measured at fair value at June 30, 2015, at December 30 and at January 1, 2014 on a recurrent basis: At June 30, 2015 Level 1 Level 2 Level 3 Total Assets Recurrent fair value measurements Fair value investments in debt securities issued and guaranteed In Colombian Pesos Colombian Government COP 2,207,350 17,075 0 2,224,425 Other entities of the Colombian Government 0 22,601 0 22,601 Other Financial institutions 6,560 366,534 0 373,094 Non-financial entities 0 17,196 0 17,196 Other 0 143,193 0 143,193

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35



Level 1 Level 2 Level 3 Total Assets In foreign currency Colombian Government 0 134,117 0 134,117 Other entities of the Colombian Government 204,850 141,704 0 346,554 Foreign governments 0 830,755 0 830,755 Central Banks 0 226,057 0 226,057 Other Financial institutions 165,979 2,265,768 0 2,431,747 Non-financial entities 75,777 292,638 0 368,415 Others 0 131,374 0 131,374 2,660,516 4,589,012 0 7,249,528 Investments in equity instruments With changes in income 3,309 1,427,509 0 1,430,818 With changes in other comprehensive income 565,224 73,622 55,936 694,782 568,533 1,501,131 55,936 2,125,600 Trading derivatives Forward in currency 0 360,918 0 360,918 Forward interest rate 0 1,705 0 1,705 Forward in securities 0 784 0 784 Interest rate swap 0 36,042 0 36,042 Currency swap 0 61,531 0 61,531 Other 0 49,153 0 49,153

0 510,133 0 510,133

Coverage derivatives Forward in currency 0 41,382 0 41,382 Forward in securities 0 10,175 0 10,175

0 51,557 0 51,557

Total assets at fair value recurrently 3,229,049 6,651,833 55,936 9,936,818

Liabilities Trading derivatives Forward in currency 0 405,213 0 405,213

Forward interest rate 0 264 0 264 Forward in securities 0 701 0 701 Interest rate swap 0 26,780 0 26,780 Currency swap 0 234,458 0 234,458 Other 0 13,420 0 13,420

0 680,836 0 680,836

Coverage derivatives Forward in currency 0 397,800 0 397,800 Forward in securities 0 2,002 0 2,002 Interest rate swap 0 2,108 0 2,108

0 401,910 0 401,910

Total liabilities at fair value recurrently COP 0 1,082,746 0 1,082,746 At December 31, 2014

Level 1 Level 2 Level 3 Total Assets Recurrent fair value measurements Fair value investments in debt securities issued and guaranteed In Colombian Pesos Colombian Government COP 2,237,895 226,259 0 2,464,154 Other entities of the Colombian Government 0 20,950 0 20,950 Other Financial institutions 0 433,260 0 433,260 Non-financial entities 0 18,159 0 18,159 Other 0 111,221 0 111,221 In foreign currency Colombian Government 107,409 0 0 107,409

(Continued)

36



Level 1 Level 2 Level 3 Total Assets Recurrent fair value measurements Fair value investments in debt securities issued and guaranteed In Colombian Pesos Other entities of the Colombian Government 228,159 0 0 228,159 Foreign governments 47,959 779,849 0 827,808 Central Banks 0 88,998 0 88,998 Other Financial institutions 1,993,757 238,531 0 2,232,288 Non-financial entities 171,224 225,630 0 396,854 Other 96,138 50,401 0 146,539 4,882,541 2,193,258 0 7,075,799

Investments in equity instruments With changes in income 1,819 1,289,556 0 1,291,375 With changes in other comprehensive income 624,061 111,503 53,813 789,377 625,880 1,401,059 53,813 2,080,752 Trading derivatives Forward in currency 0 642,021 0 642,021 Forward interest rate 0 6 0 6 Forward in securities 0 5,367 0 5,367 Interest rate swap 0 43,663 0 43,663 Currency swap 0 42,399 0 42,399 Other 0 90,557 0 90,557

0 824,013 0 824,013

Coverage derivatives Forward in currency 0 64,833 0 64,833 Forward in securities 0 19 0 19

0 64,852 0 64,852

Total assets at fair value recurrently COP 5,508,421 4,483,182 53,813 10,045,416

Liabilities Trading derivatives Forward in currency 0 700,742 0 700,742 Forward interest rate 0 273 0 273 Forward in securities 0 389 0 389 Interest rate swap 0 29,845 0 29,845 Currency swap 0 173,993 0 173,993 Other 0 45,239 0 45,239

0 950,481 0 950,481

Coverage derivatives Forward in currency 0 556,541 0 556,541 Forward in securities 0 12,152 0 12,152 Interest rate swap 0 2,952 0 2,952

0 571,645 0 571,645

Total liabilities at fair value recurrently 0 1,522,126 0 1,522,126

At January 01, 2014

Level 1 Level 2 Level 3 Total Assets Recurrent fair value measurements Fair value investments in debt securities issued and guaranteed In Colombian Pesos Colombian Government COP 4,835,045 690,832 0 5,525,877 Other entities of the Colombian Government 46,338 53,042 0 99,380 Other Financial institutions 5,333 364,881 0 370,214

(Continued)

37



Level 1 Level 2 Level 3 Total Assets Recurrent fair value measurements Fair value investments in debt securities issued and guaranteed In Colombian Pesos Non-financial entities 0 23,149 0 23,149 Other 0 97,686 0 97,686 Colombian Government 18,686 0 0 18,686 Other entities of the Colombian Government 176,575

0

0

176,575

Foreign governments 36,200

654,473

0

690,673 Central Banks 0

34,351

0

34,351

Other Financial institutions 1,318,598

127,677

0

1,446,275 Non-financial entities 374,913

57,160

0

432,073

Other 88,982

780

0

89,762 6,900,670 2,104,031 0 9,004,701

Investments in equity instruments With changes in income 6,074 1,150,153 0 1,156,227 With changes in other comprehensive income 591,574 136,471 25,798 753,843 597,648 1,286,624 25,798 1,910,070 Trading derivatives Forward in currency 0 92,214 0 92,214 Forward interest rate 0 1,471 0 1,471 Interest rate swap 0 21,833 0 21,833 Currency swap 0 25,558 0 25,558 Other 0 13,352 0 13,352

0 154,428 0 154,428

Coverage derivatives Forward in currency 0 17,086 0 17,086 Forward in securities 0 1,127 0 1,127

0 18,213 0 18,213

Total assets at fair value recurrently 7,498,318 3,563,296 25,798 11,087,412 Liabilities Trading derivatives Forward in currency 0 114,247 0 114,247 Forward interest rate 0 1,426 0 1,426 Interest rate swap 0 23,302 0 23,302 Currency swap 0 30,739 0 30,739 Other 0 24,376 0 24,376

0 194,090 0 194,090

Coverage derivatives Forward in currency 0 40,926 0 40,926 Forward in securities 0 6,724 0 6,724 Interest rate swap 0 4,941 0 4,941 Other 0 1,548 0 1,548

0 54,139 0 54,139

Total liabilities at fair value recurrently COP 0 248,229 0 248,229 Pursuant to the methodologies approved by the Colombian Financial Superintendence for pricing services, the service receives information from all external and internal trading and registry sources within the established schedule. In order to determine the fair value's level 1 and 2 of hierarchy, each instrument is assessed according to the type of calculation data reported by Infovalmer, the expert criteria from the Front Office and Middle Office, who issue their opinions considering legal aspects such as: continuity in the publication of historical prices, outstanding amount, record of transactions made, number of price contributors as a measure of depth, market intelligence, constant quotes by one or more counterparts of the specific security, spreads bid-offer, etc.

(Continued)

38



The most common methodologies applicable to derivative instruments are: Valuation of foreign currency forwards: The service publishes assigned curves according to the currency of origin of the underlying asset, which are comprised of expired nominal rates associated to exchange rate forwards. Valuation of forwards on bonds: In order to determine the valuation of the forward to a specific date, the future theoretical value of the bond is calculated on the basis of its price on the valuation date, and the risk-free rate of the country reference of the underlying asset. Listed below is the present value of the difference between the future theoretical value and the price of agreed-upon bonds in the forwards, using the risk-free rate of the reference country of the underlying asset at the term of contract expiration. Valuation of swap operations: The service publishes the assigned curves according to the underlying assets, swap base curves (exchange of payments associated to variable interest rates), domestic and foreign curves, implicit curves associated to forward exchange contracts. Valuation of OTC options: The service publishes the assigned curves according to the reporting currency of the underlying asset, forward exchange type curves of the domestic currency object of the transaction, implicit curves associated to exchange type forwards, swap curves assigned according to the underlying asset, matrix and implicit volatility curves.

In Colombia, there is no market where the prices of Mutual Funds are listed. The Value of the contributions in a mutual fund is measured through units representing shares of the equity value of the respective fund. The unit value representing the returns obtained is determined by the total amount of resources contributed plus or minus the returns of the investments that make up the portfolio. These returns are given by the valuation of the assets invested by the fund and, therefore, the level of hierarchy is determined by the levels of said assets. The Group has investments in mutual funds whose investment portfolios are made up exclusively of fixed income securities valued by the prices published by INFOVALMER. Therefore, since these assets are Level 1 or Level 2, the Group has classified its investments in mutual funds as Level 2.

Investments classified at Level 3 have significant non-observable entries. Level 3 instruments include primarily investments in securities issued as part of securitization processes of mortgage loans and investments in equity instruments that are not listed on the stock exchange. Since the observable prices are not available for these values, the Group has used valuation techniques to find the fair value.

For level 3 equity instruments, fair value is mainly the acquisition cost because these investments do not have prices on the market as they are issuers that are not listed on the stock exchange since they do not have significant influence or control, they do not have financial information and their recurrent valuation implies operating costs and efforts that are not offset by the increase in unrealized gains by fair value measurement. Financial entities take part in some investments as a mechanism to secure different types of transactions that are essential to carry out their corporate purpose.

The table below lists the transfers between levels for the period ended on June 30, 2015 and December 31, 2014

June 30, 2015

December 31, 2014

Transfers Level 1 to

Level 2 Level 2 to

Level 1

Level 1 to Level

2 Level 2 to

Level 1

Assets Fixed income investments at fair value COP 95,257 0 69,268 0

Colombian Government Bonds 0 1,067,839 0 482,787 Total Assets COP 95,257 1,067,839 69,268 482,787

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The transfer of fixed income securities from Level 1 to Level 2 was based on the volume traded and/or the issuance volume of these instruments, as well as the number of transactions carried out on business days. Some of the Colombian Government bonds are transferred from Level 2 to Level 1 because June 30, 2015 was a business day in Colombia and the Colombian Government bonds held by the Group were classified as Level 1 by Infovalmer, since they met the conditions of the minimum number of transactions, minimum amount and other filters established by the pricing service. The table below presents the transfers from Level 3 for the period ended on December 31, 2014

Transfers Fixed

Income Investments

Balance at July 01, 2014 COP 16,275 Transfers from Level 3 to Level 2 (16,010) Settlements (265)

Balance at December 31, 2014 COP 0 The transfer from Level 3 to Level 2 occurs in investments with companies from Panama that were not valued for the semester ended on December 31, 2014, they were measured by determining a valuation method using discounted flows. The table below provides a summary of the Group's financial assets and liabilities at June 30, 2015 and December 31, 2014 determined at a fair value and their corresponding book value:

Fair value and book value June 30, 2015 December 31, 2014 Book

Value Fair Value

Estimate Book

Value Fair Value

Estimate Financial Assets

Fixed income investments at amortized cost COP 8,800,959 8,629,969 6,384,593 6,266,980 Loan portfolio 81,247,509 81,724,730 72,196,111 73,227,295 Total financial assets 90,048,468 90,354,699 78,580,704 79,494,275

Financial liabilities Long-term Borrowings 15,521,435 15,370,263 15,254,112 15,217,947 Long-term outstanding investment securities 6,026,307 6,137,508 5,485,151 5,595,572 Total financial liabilities COP 21,547,742 21,507,771 20,739,263 20,813,519

6. Financial Risk Management

Banco de Bogotá and its financial sector subsidiaries, including Leasing Bogotá Panamá, which consolidates the BAC Credomatic Group, including its subsidiaries in Central America, Corporación Financiera Colombiana (Corficolombiana), Administradora de Fondos de Pensiones y Cesantías Porvenir and Fiduciaria Bogotá; administrate the risk management function feature considering the applicable regulations and internal policies. The Bank's non-financial sector subsidiaries are less exposed to certain financial risks, although they are exposed to the adverse variations in the prices of their products and operational and legal risks.

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a) Description of Risk Management Objectives, Policies and Processes The Group's objective is to maximize returns for its investors through proper risk management. To this end, the principles that guide the Group in risk management are as follows: • Provide service security and continuity to customers. • Integrate risk management in institutional processes. • Collegiate decisions within each of the Group's Boards of Directors to grant commercial loans and

carry out other investment transactions. • Extensive, in-depth knowledge of the market as a result of the leadership and expertise of

management. • Establish clear risk policies based on top-down approach, as regards:

- Compliance with know-your-customer policies. - Structures for granting commercial loans based on clear identification of sources of repayment and

debtors' capacity to generate cash flow. • Diversification of the commercial loan portfolio with regard to industries and economic groups. • Specialization in niches of consumer goods. • Extensive use of credit rating and scoring models updated on a permanent basis to ensure the growth

of consumer loans with high credit ratings. • Conservative policies in terms of:

- The composition of the trading portfolio biased toward lower-volatility instruments. - Proprietary trading. - Variable remuneration of trading staff.

b) Risk Culture

The Group's risk culture is based on the principles indicated in the section above, and it is conveyed to all the Group's entities and units, supported by the following guidelines: • In the Group, the risk function is independent and monitored at the level of each entity and the

consolidated Group. • The power delegation structure in the Group requires a large number of transactions to be sent to

decision centers, such as the risk or credit committees. The large number and frequency of meetings held by these committees ensures a high level of agility in the resolution of proposals and ensures the constant participation of senior management in the management of the various risks.

• The Group has detailed manuals on the actions and policies for proper risk management. • The Group has a risk limit system in place that is updated on a periodic basis to address new

conditions of the markets and risks to which it is exposed. • Information systems have been implemented to monitor risk exposure in a recurrent manner to ensure

that the limits of approval are complied with systematically and, if necessary to take the proper corrective measures.

• Main risks are analyzed not only when they arise or when problems occur during the normal course of business, but also on a permanent basis.

• The Group has proper, permanent training courses at all levels of the organization on risk culture.

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c) Corporate Structure of the Risk Function According to the guidelines set forth by the Group, the corporate structure on the level of the Bank and its subsidiaries for risk management, is comprised of the following levels: • Board of Directors • Risk Committees • Risk or credit vice-presidency • Administrative processes of risk management • Internal Auditing Department Board of Directors The Board of Directors of the Bank and each subsidiary is responsible for adopting, among others, the following decisions relating to the proper organization of the risk management system: • Define and approve the general policies and strategies related to the internal control system for risk

management. • Approve the policies in relation to the management of the various risks. • Approve the trading and counterparty limits, according to defined attributions. • Approve exposure and limits for different types of risks. • Approve the procedures to be followed in the event of exceeding established limits. • Approve the different procedures and methodologies for risk management. • Approve the allocation of human, physical and technical resources for risk management. • Create the committees necessary to ensure the proper organization, control and monitoring of the

operations that generate exposure, and define their duties. • Indicate the responsibilities and attributions assigned to the positions and areas in charge of risk

management. • Approve the internal control systems for risk management. • Require management to submit different periodic reports on the level of exposure to the various risks. • Evaluate the recommendations and corrective actions proposed regarding risk management

processes. • Monitor the Group's risk management and the measures taken to control or mitigate the most relevant

risks through periodic reports submitted by the Audit Committee at its regular meetings. • Approve the nature, scope, strategic business and markets in which the Group will operate.

Risk Committees

i. Comprehensive Risk Management Committee

The objective of this committee is to set forth the policies, procedures and strategies for the comprehensive management of credit, market, liquidity, operational, money laundering and terrorism financing risks. Its main duties include: • Measure the comprehensive risk profile of the Bank and its subsidiaries. • Design systems to monitor the levels of exposure to the various risks faced by the Bank and its

subsidiaries.

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• Review and propose to the Board of Directors the level of tolerance and degree of exposure to risk that the Bank is willing to assume as part of the course of business. This involves evaluating alternatives to align the risk appetite of the different risk management systems, in the Bank as well as in its subsidiaries.

• Assess the risks involved in starting out in new markets, products, segments and countries, among others.

ii. Credit and Treasury Risk Committee

The Bank has, among others, a Credit and Treasury Risk Committee made up of members of the Board of Directors, which meets regularly to discuss, measure, control and analyze the Bank's management of credit risk (SARC) and treasury risk (SARM). Its main duties include: • Monitoring the Group's credit risk and treasury profile to ensure that the risk level is kept within the

established parameters, in accordance with the limits and risk policies of the Group. • Evaluating entrance into new markets and developing new products. • Evaluating policies, strategies and rules of procedure in carrying out its treasury and loan business

activities. • Ensuring that the risk management and measurement methodologies are appropriate, given the

characteristics and activities of the entity.

iii. Assets and Liabilities Committee The Group has Assets and Liabilities Committees (ALCO or ALICO, for the Spanish original), whose objective is to assist the Board of Directors in defining policies and limits, monitoring, control and measurement systems to support the management of assets and liabilities, and the management of liquidity risk by means of the different Liquidity Risk Management Systems (SARL, for the Spanish original).

Its main duties include:

• Establishing adequate procedures and mechanisms to manage liquidity risks. • Monitoring liquidity risk exposure reports. • Identifying the origin of exposures and carry out sensitivity analysis to determine the probability of lower

returns or the needs for resources due to movements in cash flow.

iv. Audit Committee The Group has committees to assess and monitor the Internal Control System.

The main duties of these committees include: • Proposing the structure, procedures and methodologies necessary for the functioning of the Internal

Control System to be approved by the Board of Directors. • Assessing the entity's internal control structure in order to determine whether the procedures in place

reasonably protect its assets, as well as those of third parties that it manages or has custody of, and verify whether there are controls in place to ensure that transactions are being properly authorized and recorded. To this effect, the areas responsible for the management of the various risk systems, the Independent Auditor and the Audit Department submit the periodic reports defined and any others that may be required to the Committee.

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• Monitoring the risk exposure levels, impacts on the entity and the measures taken for the control or mitigation thereof.

Risk or Credit Vice-presidency The vice-presidencies of risk or credit, which are part of the organizational structure, have the following duties, among others: • Ensure proper compliance with the policies and procedures set forth by the board of directors and the

various risk committees for risk management. • Design methodologies and procedures to be followed by management for risk management. • Establish permanent monitoring procedures for the timely identification of any deviations from the

policies set forth for risk management. • Prepare periodic reports for the various risk committees, as well as for the board of directors of each

subsidiary and government oversight and control entities, in relation to compliance with the risk policies. Administrative Processes for Risk Management In accordance with its business models, the Group has structures and procedures that are defined and documented in manuals on the administrative processes to be followed for the management of the various risks and, in turn, it has different technological tools, discussed in detail herein, to monitor and control risks. Internal Auditing Department The Group's internal audits are independent from management. They depend directly on the audit committees and, in the performance of their duties, they conduct periodic compliance assessments with the policies and procedures followed by the Group for risk management. Their reports are submitted directly to the risk committees and the audit committees, which are in charge of monitoring the Group's management of the corrective measures taken. In addition, the Group receives periodic visits from the internal auditing departments to monitor compliance with the risk management policies on the Group level. Their reports are submitted directly to the Group's audit committees and management.

Grupo BAC Credomatic

Regarding Banco de Bogotá subsidiaries, Leasing Bogotá Panamá consolidates the Grupo BAC Credomatic located in Central America. This Group has its own policies, duties and procedures for risk management, which are in line with the guidelines set forth by Banco de Bogotá. Risks are periodically managed and monitored by means of the following corporate governance bodies, established at the regional level as well as in the countries where the Company operates: Comprehensive Risk Management Committee, Assets and Liabilities Committee (ALICO, for the Spanish Original), Compliance Committee, Credit Committee, Audit Committee and Investment Committee, as applicable.

With regard to credit risk management, BAC has a centralized structure with a National Risk Director who reports to the CEO of BAC, who in turn leads the Regional Credit Committee, which is responsible for establishing the applicable growth strategies, policies and procedures in accordance with each country's level of risk. While local risk management units report to the CEO of the entity in each country, compliance with the policies and procedures is reported to the Regional Risk Director.

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With regard to market risk, BAC has a regional unit to manage the investment policy and the policy to manage assets and liabilities, which establishes guidelines to determine country and counterparty risk limits, limits on monetary positions in foreign currency and guidelines for the management of liquidity, interest rate and exchange risks. The establishment of regional risk management policies is the responsibility of the Regional Assets and Liabilities Committee, which is made up of BAC Board Members.

d) Individual Risk Analysis Banco de Bogotá and its financial subsidiaries, in the regular course of business, are exposed to different financial, operational, reputational and legal risks. The financial risks include i) market risk (which includes trading risk and price risk, as explained herein), and ii) structural risks for the composition of assets and liabilities in the consolidated statement of financial position of the Bank and subsidiaries, mainly credit risk, the risk of variation in the exchange rate, liquidity risk and interest rate risk. An analysis of each of the aforementioned risks is shown below.

i. Credit Risk

On a daily basis the Bank and its financial subsidiaries assume credit risk on two fronts: lending – which includes commercial credit operations, consumer, mortgage and micro credit – and treasury activity – which includes interbank operations, investment portfolio management, operations with derivatives and foreign currency trading, among others. Despite being independent lines of business, the nature of the risk of the counterparty is equal, and therefore the criteria applied to managing risk is the same. The principles and rules to manage loan and credit risk in the Bank and its financial subsidiaries are described in the Loan Manual, which is conceived for traditional banking activity, as well as treasury activity. The assessment criteria to measure credit risk follow the main guidelines provided by the Credit and Treasury Risk Committee. In turn, regarding treasury operations, it is the responsibility of the Board of Directors of the Bank and each financial entity to approve the operational and counterparty limits, according to the attributions defined. Risk control is essentially carried out through three mechanisms: annual allocation of operational limits and daily control, periodic assessment of solvency by issuers and reporting on the concentration of investments by economic group. Additionally, loan approval also considers the probability of default, counterparty limits, the recovery rate of collateral received, loan terms and the concentration by economic sectors, among others.

Consolidated Exposure to Credit Risk The Bank and its financial subsidiaries are exposed to credit risk, which consists of the debtor causing a financial loss for not fulfilling its obligations in a timely manner and in the full amount of the debt. The exposure to credit risk of the Bank and its financial subsidiaries arises as a result of its loan activities and transactions with counterparties that give rise to the acquisition of financial assets.

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The maximum exposure to credit risk of the Bank and its financial subsidiaries on the consolidated level is reflected in the book value of the financial assets in the consolidated statement of financial position at June 30, 2015 and December 31, 2014 as indicated below:

June 30,

2015 December

31, 2014 January

01, 2014 Assets Deposits in banks other than the Central Bank of Colombia COP 9,075,406 8,297,213 5,404,862 Debt instruments at fair value Governance 3,784,509 3,737,478 6,545,541

Financial entities 2,804,842 2,665,548 1,816,490 Other sectors 660,178 672,773 642,670

Derivative instruments 561,690 888,866 172,641 Debt instruments at amortized cost Investments in debt securities 8,800,959 6,384,593 5,375,982 Loan portfolio Commercial 54,248,818 47,932,116 41,395,988

Consumer 19,983,123 18,068,202 14,114,828 Mortgage 8,555,866 7,610,873 5,488,358 Microcredit 366,897 353,025 333,499 Other accounts receivable 4,904,250 4,465,033 3,765,261

Total financial assets with credit risk 113,746,538 101,075,720 85,056,120 Off-balance sheet credit risk Financial collateral and guarantees 4,156,772 2,794,128 2,605,274 Credit limits 12,778,694 11,915,724 10,155,574 Total exposure to off-balance sheet credit risk 16,935,466 14,709,852 12,760,848 Total maximum exposure to credit risk COP 130,682,004 115,785,572 97,816,968

The impact of netting assets and liabilities to potentially reduce exposure to credit risk is not significant. For guarantees and commitment to extend the amount of the loans, the maximum exposure to credit risk is the amount of the commitment. To this effect, see Note 12. Credit risk is mitigated by guarantees and collateral as described below: Mitigation of credit risk, guarantees and other credit risk improvements In applicable cases, maximum exposure to credit risk of the Bank and its financial subsidiaries is reduced by collateral and other credit enhancements, which reduce credit risk. The existence of guarantees can be a necessary measure but it is not a sufficient instrument to accept credit risk. The credit risk policies of the Bank and its financial subsidiaries require an assessment of the debtor's ability to pay and its capacity to generate sufficient sources of resources to allow the amortization of the debts. The methods used to assess guarantees are in line with the best market practices and involve the use of independent real estate appraisers, the market value of the securities or the valuation of the companies that issue said securities. All guarantees must be assessed in accordance with the law and created based on the parameters of the constitution thereof in accordance with the Colombian legal standards. The details of the guarantees received to back the loans granted by the Bank and its financial subsidiaries on the consolidated level are listed in Note 12.

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Policies to Prevent Excessive Concentration of Credit Risk

In order to prevent excessive concentration of credit risk on the individual level, the country level and the level of economic sectors, the Bank and its financial subsidiaries maintain indices of maximum levels of risk concentration updated individually and by sector portfolios. The exposure limit of the Bank and its financial subsidiaries in a loan commitment to a specific customer depends on the customer's risk rating. According to Colombian legal standards, the Bank cannot grant individual loans to a counterparty exceeding more than 10% of its adequate equity if the loans do not have acceptable guarantees in accordance with the legal standards, and no more than 25% of the adequate equity of each bank when the loan is secured by acceptable guarantees. The details of the concentration of credit risk on the level of the Bank and its financial subsidiaries in the different geographic areas, determined in accordance with the debtor's country of residence, regardless of the provisions constituted for impairment of the debtors' credit risk, as well as the loan portfolio by economic sector, are listed in Note 12. Sovereign Debt

At June 30, 2015 and December 31, 2014, the portfolio of financial assets in debt instruments consists mainly of securities issued or endorsed by the Colombian Government or Foreign Governments, representing more than 66% and 64% thereof, respectively.

Process of Granting Counterparty Loans and Limits The Bank and its financial subsidiaries have a Credit Risk Management System (SARC, for the Spanish original), which is managed in the Bank by the Credit and Treasury Risk Management Office and at BAC Credomatic by the Vice-presidency of Credit, and considers, among others, the design, implementation and assessment of the risk policies and tools defined by the Risk Committees and the Boards of Directors. Credit management is carried out based on policies that are clearly defined by the Board of Directors, reviewed and amended on a periodic basis based on changes and expectations of the markets in which the Bank operates, including regulations and other factors to be considered in the formulation of these policies. When granting loans, there are various models for credit risk assessment: financial rating models for the commercial loan portfolio, which are models based on the customer's financial information and the customer's financial history with the Bank and the financial system in general; and scoring models for mass loan portfolios (consumer, mortgage and microcredit), which are based on information regarding performance with the bank and with the system, as well as sociodemographic and customer profile variables. In addition, an analysis of the transaction's financial risk is conducted based on the debtor's ability to pay and its future generation of funds. Credit Risk Monitoring Process The process of monitoring credit risk in the Group is carried out in several stages, which include monitoring and managing daily collection based on an analysis of past due loans by ages, rating by risk levels, permanent monitoring of high-risk customers, a process of restructuring transactions and receiving foreclosed assets.

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Banco de Bogotá and its financial subsidiaries assess the risk of each of their debtors on a monthly basis in accordance with their financial information and/or behavior and according to said information, they classify customers by levels of risk in Category A - Normal, B - Subnormal, C - Deficient, D - Doubtful and E - Non-recoverable. For consumer loans, all the elements of the loan cycle are constantly studied, starting with design and origination up to the collection and cross-selling process. To this end, there is a set of standard reports and a structure of periodic monitoring committees. For commercial loans, Banco de Bogotá conducts a quarterly assessment on the individual level by economic sectors (25 macro sectors) to monitor portfolio concentration and risk level. In addition, it has designed a financial warning system that involves an individual analysis of customers in situations of possible increase in credit risk. These studied are analyzed in assessment committees, holding meetings periodically. Levels of arrears, risk, coverage of allowances and portfolio concentration are monitored on a permanent basis using a reporting system issued before senior management. In the case of BAC Credomatic, the Company structures acceptable levels of credit risk by establishing limits on the quantity of acceptable risk in relation to just one borrower or group of borrowers and geographic segment. These loans are controlled constantly and they are subject to periodic review. Exposure to credit risk is managed through a periodic analysis of the borrower or potential borrowers, in order to determine their ability to pay capital and interest. Exposure to credit risk is also mitigated partly by obtaining collateral, corporate and personal guarantees.

The Company has a series of credit reports in place to assess the performance of its loan portfolio, the requirements for provisions and particularly, to anticipate events that can affect the condition of its debtors. At June 30, 2015 and December 31, 2014, the past due loans by maturities and by risk rating are listed in Note 12. Restructuring Credit Operations Due to Debtor's Financial Problems The Bank and its financial subsidiaries periodically restructure the debt of customers having problems fulfilling their loan obligations, at the request of the debtor. This restructuring usually consists of extending terms, lowering term interest or new structuring depending on the customer's needs. The base policy to grant this refinancing is to provide the customer with the conditions to pay the debt to a new situation of generating funds based on the financial feasibility thereof. The use of restructuring for the sole purpose of delaying the constitution of provisions is prohibited in the Group. When a loan is restructured due to the debtor's financial issues, the debt is flagged in the files of the Bank and its financial subsidiaries as restructured loan in accordance with the regulations of the Colombian Financial Superintendence. The restructuring process has a negative impact on the debtor's risk rating. After restructuring, the risk rating will only improve when the customer complies with the terms of the agreement during a reasonable period and its new financial situation is adequate or additional collateral is provided.

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Receiving Foreclosed Assets When persuasive collection or loan restructuring processes do not have satisfactory results within a reasonable period of time, legal collection is carried out or agreements are made with the customer for the receipt of foreclosed assets. Each entity has clearly established policies for receiving foreclosed assets and has separate departments specialized in handling these cases, receiving foreclosed assets and the subsequent sale thereof. The following are the details of foreclosed assets and those sold during the semesters ended on June 30, 2015 and December 31, 2014:

June 30,

2015 December

31, 2014 Foreclosed Assets COP 171,972 152,806 Assets sold 190,691 47,970 COP 362,663 200,776

ii. Market Risks

The Group participates in monetary, exchange and capital markets, to satisfy its needs and those of its customers in accordance with the policies and risk levels. In that regard, it manages various portfolios of financial assets within the limits and risk levels allowed.

Risks assumed in carrying out operations both of the bank book and treasury book are consistent with the overall business strategy and its risk tolerance, based on the depth of the markets for each instrument, its impact on risk-weighted assets and solvency level, the profits budget established for each business unit, and the balance structure. Business strategies are established pursuant to the approved limits, seeking a balance in the profit/risk relation. Similarly, there is a limit structure congruent with the overall philosophy of the Bank and its financial subsidiaries, based on its levels of capital, earnings performance and risk tolerance. Market risk is originated by the Group's open positions in debt security investment portfolios, equity instruments and transactions with derivatives recorded at fair value, due to adverse changes in risk factors, such as: prices, interest rates, exchange rates, share prices, credit margins of the instruments, and the liquidity of the markets on which the Group operates. The Bank trades financial instruments with several objectives, including: • Offering products tailored to customers' needs, which hedge their financial risks, among other functions. • Structuring portfolios that can take advantage of arbitrage between different rate curves, assets and

markets, and obtain high returns using low levels of equity. • Carrying out transactions with derivatives to hedge risks of asset and liability positions of their balance

sheet, as well as brokering for customers or capitalizing on arbitrage opportunities of both the exchange rate and interest rates in local and foreign markets.

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At June 30, 2015 and December 31, 2014, the Group had the following financial assets and liabilities at fair value subject to trading market risk:

June 30, 2015

Account

Banco Bogotá Leasing

Bogotá Panamá

Corficolombiana

Porvenir

Others / Eliminations

Total

Investments in debt securities

1,433,319 2,719,101 1,643,208 530,611 923,289 7,249,528

Active derivative instruments 388,218 12,508 150,425 10,461 78 561,690 Total assets 1,821,537 2,731,609 1,793,633 541,072 923,367 7,811,218 Passive derivative instruments

755,253 4,195 292,644 506 30,148 1,082,746

Net position 1,066,284 2,727,414 1,500,989 540,566 893,219 6,728,472

December 31, 2014

Account

Banco Bogotá Leasing

Bogotá Panamá

Corficolombiana

Porvenir

Others / Eliminations

Total

Investments in debt securities

2,517,050 2,767,722 691,134 395,356 704,537 7,075,799

Active derivative instruments 603,019 1,011 232,984 51,842 9 888,865 Total assets 3,120,069 2,768,733 924,118 447,198 704,546 7,964,664 Passive derivative instruments

1,139,110 15,244 340,426 29 27,317 1,522,126

Net position 1,980,959 2,753,489 583,692 447,169 677,229 6,442,538

The Market Risk Management System (SARM, for the Spanish original), allows the Bank and its financial subsidiaries to identify, measure, control and monitor the market risk it may be exposed to, according to the positions assumed in carrying out its operations. There are several scenarios in which the Group is exposed to market risks. • Interest Rate

The Group's portfolios are exposed to this risk when the variation of the active positions' market value caused by a change in interest rates does not match the variation of the liability positions' market value, and this difference is not compensated by the variation in market value of other instruments, or when the future margin depends on interest rates due to pending operations. • Exchange Rate

The Group's portfolios are exposed to exchange risk when the actual value of the asset positions in each currency does not match the actual value of the liability positions in the same currency and the difference is not compensated; positions are taken in derivative products whose underlying asset is exposed to the exchange risk and the sensitivity of the value compared to variations in types of exchange has not been immunized completely; positions are taken at interest rate risk in currencies other than the reference currency that can alter the parity between the value of the asset positions and the value of the liability positions in said currency, and which generates losses or profits, or when the margin depends directly on the types of exchange.

For analysis purposes, market risk has been segmented in the risk of trading financial assets and the price risk of investments in equity securities.

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The Group's Senior Management and Board of Directors play an active role in managing and controlling risks through the analysis of an established report protocol and presiding over various committees, which comprehensively monitor both technically and fundamentally the different variables that influence markets at internal and external levels in order to support strategic decisions. Furthermore, the analysis and monitoring of the various risks incurred by the entities in their operations is fundamental in making decisions and assessing results. On the other hand, a permanent analysis of the macroeconomic conditions is essential in achieving an optimal combination of risk, return and liquidity. The risks assumed in carrying out operations are evident in a framework of limits for the positions in different instruments according to its specific strategy, the depth of the markets in which it operates, its impact on risk-weighted assets and solvency level, as well as balance structure. These limits are monitored and reported to the Board of Directors of the Bank and each subsidiary on a periodic basis. In addition, in order to minimize the risks associated with interest rates and exchange rates for some of the items in its balance, the Bank and its financial subsidiaries implement hedging strategies by taking positions on derivative instruments such as national bond futures, non-deliverable TES forwards, simultaneous operations and exchange contracts. According to its risk management strategy, exposure to exchange risk generated by investments in affiliates and agencies abroad is hedged through a combination of "non-derivative" instruments (bonds issued in USD) and "derivative" instruments (dollar - Colombian peso forwards portfolio), which are treated in accounting as "hedging", subject to compliance with the requirements. Market risks are quantified through value-at-risk models (internal and standard). Likewise, measurements are made using the historical simulation methodology. The boards of directors approve a framework of limits according to the value at risk associated to the annual earnings budget and establish additional limits by risk type. The Group uses the standard model to measure, control and manage the market risk of the interest rate market, and exchange rates in both treasury book and the bank books, in accordance with the requirements of the Colombian Financial Superintendence. Asset and liability positions in the treasury book are currently mapped in zones and bands according to the duration of the portfolios, investments in equity securities and the net position (asset minus liability) in foreign currency, both in the Bank and Treasury Books, in line with the standard model recommended by the Basel Committee. Similarly, the entities have parametric and non-parametric models for internal management in the Value-at-Risk (VaR) methodology, which complement its market risk management based on the identification and analysis of variations in risk factors (interest rates, exchange rates, and price indexes) on the value of the different instruments that comprise the portfolios. These models include the JP Morgan Risk Metrics and the historical simulation methods. The use of these methodologies makes it possible to estimate the profits and capital in risk, facilitating the allocation of resources to the different business units, and to compare activities in different markets and identify the positions that have a greater contribution to the risk of the Treasury businesses. Furthermore, these tools are used to determine limits for the treasury's traders and to review positions and strategies quickly, as market conditions change.

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The methodologies used to measure the different types of risks are periodically assessed and back-tested in order to check their efficiency. In addition, the banks have tools to carry out portfolio stress and/or sensitivity tests using simulations of extreme scenarios. Additionally, there are limits established by "Risk Type" associated with each instrument that comprises the various portfolios (sensitivity or effects on the value of the portfolio as a result of interest rate fluctuations or corresponding factors - impact of fluctuations on specific risk factors: interest rate (Rho), exchange rate (Delta), volatility (Vega), among others. Moreover, the Group has established counterparty and trading limits per operator for each trading platform of the markets wherein it operates. These limits are controlled daily by the Group's Back and Middle Offices. Trading limits per operator are assigned to the Treasury's different levels according to the officer's experience in the market, in trading this type of product and in portfolio management. There is also a process to monitor valuation input and prices published by the Infovalmer pricing service, which aims to identify the prices with significant differences on a daily basis in comparison with other financial information tools (Bloomberg, for instance). This monitoring is carried out to contest the prices published by said services, if necessary. In the case of BAC, a process was established to monitor the clean prices of the international vector published by Bloomberg. In addition, a model is used to analyze the liquidity of fixed income bonds issued abroad to determine market depth for this type of instruments. Finally, part of the work to monitor operations includes controlling different aspects of trading such as negotiated terms, unconventional operations or off-market operations, operations with related parties, etc. According to the standard model, the market value-at-risk (VaR) at June 30, 2015 and December 31, 2014 for the Group was as follows:

VaR Maximum, Minimum and Average Values

June 30, 2015

Minimum Average Maximum Latest

Interest Rate 560,718 648,733 725,027 660,454 Exchange Rate 19,479 35,159 46,162 19,479 Shares 8,242 9,548 11,060 8,242 Mutual funds 194,534 197,603 203,721 194,534 Total VaR 812,495 891,043 977,950 882,709

VaR Maximum, Minimum and Average Values December 31, 2014

Minimum Average Maximum Latest

Interest Rate 527,048 586,700 673,857 560,717 Exchange Rate 6,752 21,788 46,162 46,162 Shares 11,060 12,472 14,087 11,060 Mutual funds 169,336 179,858 194,556 194,556 Total VaR 731,167 800,818 874,085 812,495

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52



VaR indicators presented by the Bank and its main financial subsidiaries for the semesters ended on June 30, 2015 and December 31, 2014 are summarized below:

Entity June 30, 2015 December 31, 2014 Value Basis Points of

Technical Equity Value Basis Points of

Technical Equity Banco Bogotá (Parent Company) COP 340,320 42 323,391 45 Leasing Bogotá Panama and subsidiary 58,502 7 59,401 8 Banco de Bogotá Panama and Subsidiary 11,022 1 8,701 1 Casa de Bolsa 4,344 1 4,543 1 Corficolombiana and financial subsidiaries 298,500 37 262,139 36 Fidubogotá 10,697 1 9,229 1 Porvenir 159,324 19 145,091 20 Consolidated VaR COP 882,709 108 812,495 112

Risk of Variation in Foreign Currency Exchange Rate

The Group operates internationally and it is exposed to variations in the exchange rate that arise from exposures in several currencies, mainly with regards to US Dollars and Euros. The risk of foreign currency exchange rate is caused mainly by assets and liabilities recognized in investments in subsidiaries and branches abroad, loan portfolios, obligations in foreign currencies and future commercial transactions in foreign currency. Banks in Colombia are authorized by the Central Bank of Colombia to trade currencies and maintain balances in foreign currency in accounts abroad. The legal standards in Colombia require banks to maintain a daily proprietary position in foreign currency, determined by the difference between foreign currency-denominated rights and obligations recorded on and off the balance sheet, whose three-day average cannot exceed the equivalent in foreign currency of twenty percent (20%) of the adequate equity as indicated in Note 36. Also, the three business-day average in foreign currency can be negative, without exceeding the equivalent in foreign currency of five percent (5%) of said adequate equity. Furthermore, there is a limit on the spot market proprietary position, which is determined by the difference between foreign currency-denominated assets and liabilities, excluding derivatives and others that are not considered "immediate settlement" assets and liabilities. The three business-day average of this spot market proprietary position cannot exceed fifty percent (50%) of the entity's adequate equity, nor can it be negative. In addition, there are limits to the gross leverage position, which is defined as the sum of the rights and responsibilities in foreign currency-denominated contracts for future fulfillment, foreign currency-denominated spot transactions for fulfillments greater than or equal to one business day and exchange exposure associated with the contingencies acquired by trading options and other derivatives due to the exchange rate. The three business-day average of the gross leverage position cannot exceed the equivalent in foreign currency of five hundred and fifty percent (550%) of the amount of the entity's adequate equity. The maximum and minimum amount of the daily proprietary position and spot market proprietary position in foreign currency must be determined based on the adequate equity of each bank, on the last day of the second previous calendar month, translated at the exchange rate established by the Financial Superintendence at the end of the previous month.

(Continued)

53



Substantially, all of the Group's assets and liabilities in foreign currency are held in US dollars. Details of the assets and liabilities in foreign currency held by the Group at June 30, 2015 and December 31, 2014 are shown below.

June 30, 2015

US Dollars Euros

Other Currencies Expressed

Total (in millions of Colombian

pesos) Assets in foreign currency

Cash and cash equivalents COP 10,210,711 3,898 1,792 10,216,401 Investments in debt securities at fair value

4,088,328 0 0 4,088,328

Investments in debt securities at amortized cost

2,404,425 0 0 2,404,425 Investments in equity instruments

1,683 0 0 1,683

Trading derivatives

37,937 89,181 11,209 138,327 Loan portfolio at amortized cost

42,138,159 1,879 2,446 42,142,484

Hedge derivatives 20,293 0 0 20,293 Other accounts receivable

922,856 0 0 922,856

Other Assets

5,616,420 1,302 0 5,617,722 Total assets in foreign currency

65,440,812 96,260 15,447 65,552,519

Liabilities in foreign currency Client deposits

39,591,353 1,705 255 39,593,313 Trading derivatives

187,343 89,181 7,334 283,858

Other accounts payable and other liabilities

1,055,227 1,637 0 1,056,864 Short-term borrowings

490,136 0 0 490,136

Short-term borrowings with rediscount agencies

127,823 0 0 127,823 Long-term borrowings

12,583,554 1,879 2,446 12,587,879

Bonds

3,886,672 0 0 3,886,672 Hedge derivatives

4,554 0 0 4,554

Provisions

90,136 0 0 90,136 Income tax liability

132,776 0 0 132,776

Total liabilities

58,149,574 94,402 10,035 58,254,011 Net active (passive) position COP 7,291,238 1,858 5,412 7,298,508

December 31, 2014

US Dollars Euros

Other Currencies Expressed

Total (in millions of Colombian

pesos) Assets in foreign currency

Cash and cash equivalents COP 9,466,433 6,548 2,384 9,475,365 Investments in debt securities at fair value

3,774,279 0 0 3,774,279

Investments in debt securities at amortized cost

2,044,333 0 0 2,044,333 Investments in equity instruments

7,054 0 0 7,054

Trading derivatives

3,982,755 117,556 31,342 4,131,653 Loan portfolio at amortized cost

35,560,951 4,380 1,289 35,566,620

Other accounts receivable

447,425 581 0 448,006 Hedge derivatives

(445,741) 0 0 (445,741)

Other Assets

5,620,090 0 0 5,620,090 Total assets in foreign currency

60,457,579 129,065 35,015 60,621,659

Liabilities in foreign currency

Client deposits

34,355,692 4,405 762 34,360,859

Trading derivatives

4,931,178 117,561 31,257 5,079,996 Other accounts payable

1,284,091 684 27 1,284,802

Short-term borrowings

679,032 0 0 679,032 Short-term borrowings with rediscount agencies

159,768 0 0 159,768

Long-term borrowings

12,441,999 4,380 1,289 12,447,668 Bonds

3,513,261 0 0 3,513,261

Hedge derivatives

4,235,399 0 0 4,235,399 Provisions

300,900 0 0 300,900

Income tax liability

565 0 0 565 Total liabilities in foreign currency

61,901,885 127,030 33,335 62,062,250

Net active (passive) position COP (1,444,306) 2,035 1,680 (1,440,591)

(Continued)

54



The Group's objective regarding transactions in foreign currency is to meet the financing needs of foreign trade customers and maintain its positions within the authorized risk limits. The Group has established policies that require the management of exchange rate risk in foreign currency against each of the reporting currencies of the countries where it is operating. Exchange rate exposure is hedged by using derivative and non-derivative instruments. The Group has several investments in subsidiaries and branches abroad whose net assets are exposed to conversion risk for their financial statements for consolidation purposes. The exposure arising from net assets in operations abroad is primarily covered by borrowings, bonds issued to the market and derivative instruments in foreign currency. (See Note 24) The estimated effect of the increase at a rate of 1% with regard to the exchange rate at June 30, 2015 would be an increase of COP 6,555 in assets and COP 649,622 in liabilities, and COP 5,825 and 493,666, respectively, in nominal values at December 31, 2014. Interest Rate Structure Risk: The Group is exposed to the effects of fluctuations on the interest rate market that affect its financial standing and future cash flows. Interest margins can increase as a result of changes in interest rates; however, they can also decrease and create losses in the event of unexpected changes in said rates. To this effect, they are monitored on a periodic basis and limits are established on the level of mismatches in the repricing of assets and liabilities due to changes in interest rates. The following table summarizes the Group's exposure to changes in interest rates on the consolidated level.

Semester Ended June 30, 2015

Account Details

Average Interest Revenue/Expense

Average Interest

Rate 50 bp Variation in the

Interest Rate

Favorable Unfavorable

Financial Assets that Earn Interest Active money market transactions in Colombian pesos

588,071 49,033 16.70% (2,940) 2,940

Active money market transactions in foreign currency

1,485,142 26,991 3.60% (7,426) 7,426

Loan portfolio in Colombian pesos 39,392,592 1,988,703 10.10% (196,963) 196,963 Loan portfolio in foreign currency 35,499,393 1,707,228 9.60% (177,497) 177,497

Total financial assets that earn interest in Colombian pesos

39,980,663 2,037,736 10.20% (199,903) 199,903

Total financial assets that earn interest in foreign currency

36,984,535 1,734,219 9.40% (184,923) 184,923

Total financial assets that earn interest 76,965,198 3,771,955 9.80% (384,826) 384,826

Financial liabilities at financial cost

Deposits in Colombian pesos 41,291,986 729,832 3.50% (206) 206,46 Deposits in foreign currency 36,375,526 412,803 2.30% (181,878) 181,878 Passive money market transactions in Colombian pesos

5,375,351 96,548 3.60% (26,877) 26,877

Passive money market transactions in foreign currency

394,202 3,848 2.00% (1,971) 1,971

Borrowings in Colombian pesos 3,281,506 144,639 8.80% (16,408) 16,408 Borrowings in foreign currency 11,818,456 17,784 0.30% (59,092) 59,092 Bonds in Colombian pesos 2,484,229 14,309 1.20% (12,421) 12,421 Bonds in foreign currency 3,278,864 103,734 6.30% (16,394) 16,394

(Continued)

55



Account Details


Average Interest


Interest Rate

Favorable Unfavorable

Total Financial liabilities at financial cost in Colombian pesos

52,433,072 985,328 3.80% (262,165) 262,165

Total Financial liabilities at financial cost in foreign currency

51,867,048 538,169 2.10% (259,335) 259,335

Total Financial liabilities at financial cost 104,300,120 1,523,497 2.90% (521,501) 521,501 Total Net Financial assets subject to interest rate risk in Colombian pesos

(12,452,409) 1,052,408 6.40% 62,262 (62,262)

Total Net Financial assets subject to interest rate risk in foreign currency

(14,882,513) 1,196,050 7.30% 74,412 (74,412)

Total Net Financial assets subject to interest rate risk

(27,334,922) 2,248,458 6.90% 136,675 (136,675)

Semester ended on December 31, 2014

Account Details


Average Interest


Interest Rate

Favorable Unfavorable Financial Assets that Earn Interest Active money market transactions in Colombian pesos

237,902 196,097 82.40% (1,190) 1,190

Active money market transactions in foreign currency

1,416,134 43,155 3.00% (7,081) 7,081

Loan portfolio in Colombian pesos 34,741,867 3,497,793 10.10% (173,709) 173,709 Loan portfolio in foreign currency 27,873,064 2,616,638 9.40% (139,365) 139,365

Total financial assets that earn interest in Colombian pesos

34,979,769 3,693,890 10.60% (174,899) 174,899

Total financial assets that earn interest in foreign currency

29,289,198 2,659,793 9.10% (146,446) 146,446

Total financial assets that earn interest 64,268,967 6,353,683 9.90% (321,345) 321,345 Financial institution deposits in Colombian pesos

38,415,879 1,269,900 3.30% (192,079) 192,079

Financial institution deposits in foreign currency

28,431,665 636,786 2.20% (142,158) 142,158

Passive money market transactions in Colombian pesos

4,664,705 139,254 3.00% (23,324) 23,324

Passive money market transactions in foreign currency

405,462 8,111 2.00% (2,027) 2,027

Borrowings in Colombian pesos 2,979,645 225,516 7.60% (14,898) 14,898 Borrowings in foreign currency 9,779,456 30,300 0.30% (48,897) 48,897 Bonds in Colombian pesos 1,985,629 32,543 1.60% (9,928) 9,928 Bonds in foreign currency 2,853,640 157,646 5.50% (14,268) 14,268

Total Financial liabilities at financial cost in Colombian pesos

48,045,858 1,667,213 3.50% (240,229) 240,229

Total Financial liabilities at financial cost in foreign currency

41,470,223 832,843 2.00% (207,350) 207,350

Total Financial liabilities at financial cost 89,516,081 2,500,056 2.80% (447,579) 447,579

Total Net Financial assets subject to interest rate risk in Colombian pesos

(13,066,089) 2,026,677 7.10% 65,330 (65,330)

Total Net Financial assets subject to interest rate risk in foreign currency

(12,181,025) 1,826,950 7.10% 60,904 (60,904)

Total Net Financial assets subject to interest rate risk

(25,247,114) 3,853,627 7.10% 126,234 (126,234)

(Continued)

56



If the interest rates had been 50 basis points lower or higher, with all other variables constant, the Group's semester (annualized) earnings would have increased or decreased respectively by COP 126,236 (December 31, 2014 COP 136,675), mainly as a result of lower or higher interest expenses on the passive interest with variable interest rates. The Group is exposed to the risk of prepayment on loans placed at fixed interest rates, including mortgage loans, which entitle the debtor to repay loans early. The Bank's earnings for the six-month periods ended on June 30, 2015 and December 31, 2014 would not have changed in a significant manner due to changes in the prepayment index, because the loan portfolio is kept at amortized cost and the right to prepayment is for a value similar to the amortized cost of the loans.

iii. Liquidity Risk Liquidity risk is related to the inability of the Bank and each of its subsidiaries to fulfill the obligations acquired with customers and counterparties of the financial market at any time, currency and place, for which each entity reviews its available resources on a daily basis. The Group manages liquidity risk in accordance with the relevant rules for risk management through the principles set forth in the different Liquidity Risk Management Systems (SARL, for the Spanish original), which establish the reasonable minimum parameters that the entities must monitor in their operation to effectively manage the liquidity risk to which they are exposed. For BAC Credomatic, liquidity risk is managed in accordance with the policies and guidelines issued by Regional and Local Board of Directors and/or Management, complying with the particular regulations of each country where it operates, as well as the contractual obligations acquired in each case.

As part of liquidity risk analysis, the Group measures the volatility of the deposits, debt levels, structure of the assets and liabilities, the degree of asset liquidity, the availability of lines of financing and the general effectiveness of assets and liabilities. This is done to maintain sufficient liquidity (including liquid assets, guarantees and collateral) to deal with possible scenarios involving one or systemic stress. The quantification of funds obtained on the monetary market is an integral part of each bank's liquidity measurement. Based on technical studies, the Bank and its subsidiaries determine primary and secondary sources of liquidity to diversify the fund suppliers with the aim to ensure the stability and -sufficiency of funds and to minimize the concentration of sources. Once the sources of the funds are established, they are assigned to the different lines of business according to the budget, nature and depth of the markets. The availability of resources is monitored, to meet the reserve requirements and to forecast and/or anticipate possible changes in the liquidity risk profile of the Bank and its subsidiaries and to be able to make strategic decisions as appropriate. In this sense, each entity has liquidity warning indicators that allow it to establish and determine its current situation, as well as strategies to be implemented in each case. These indicators include the LRI, levels of concentration of deposits, and the use of the Central Bank's liquidity quotas.

(Continued)

57



Through the Committees on Assets and Liabilities, the senior management of each entity is aware of their liquidity situation and makes the necessary decisions considering the high-quality liquid assets that must be maintained; the reserve requirements; the strategies for granting loans and obtaining funds; policies for placing liquidity surpluses; changes in the characteristics of new and existing products; the diversification of the sources of funds to prevent the concentration of funds in few investors or savers; hedging strategies; the statement of income of the Bank and subsidiaries; and the changes in the balance structure. In order to meet the legal reserve requirements, entities in Colombia and Central America must maintain cash on hand and in banks, including deposits in central banks, in accordance with the percentages on customer deposits and other liabilities set forth in the regulations of each of the jurisdictions where the Bank and its financial subsidiaries operate. The Bank and its financial subsidiaries have successfully met these requirements. Below is an analysis of the contractual maturities by ranges of maturity of the Group's financial liabilities at June 30, 2015 and December 31, 2015:

iv. Operational Risk The Group has an Operational Risk Management System (SARO) implemented according to the guidelines set forth by the Colombian Financial Superintendence, which is managed by the Operational Risk Units of the entities. Thanks to SARO, the Group has strengthened the understanding and control of risks in processes, activi-ties, products and operating lines; and it has managed to reduce errors and identify opportunities for improvement that will support the development and operation of new products and services.

June 30, 2015

Description

Up to One Month

More than One Month

and No More than Three

Months

More than Three Months and No More

than One Year

More than One Year and No More than

Five Years

More

than five years

Total

At amortized cost Client deposits COP 46,303,177 5,330,297 12,005,664 17,040,583 1,378,465 82,058,186 Short-term borrowings 7,240,160 0 0 0 0 7,240,160 Long-term borrowings 492,438 950,378 4,849,867 4,436,904 4,791,848 15,521,435 Outstanding investment securities

53,782 62,082 144,277 2,867,225 2,898,941 6,026,307

COP 54,089,557 6,342,757 16,999,808 24,344,712 9,069,254 110,846,088

December 31, 2014

Description

Up to One Month

More than One Month

and No More than Three

Months

More than Three

Months and No More than

One Year

More than One Year and No

More than Five Years

More

than five years

Total

At amortized cost Client deposits COP 42,482,159 4,485,196 12,071,900 13,903,490 709,962 73,652,707 Short-term borrowings 3,248,344 0 0 0 0 3,248,344 Long-term borrowings 402,930 1,437,659 4,222,319 4,854,792 4,336,411 15,254,111 Outstanding investment securities

58,938 58,730 539,652 2,328,386 2,499,445 5,485,151

COP 46,192,371 5,981,585 16,833,871 21,086,668 7,545,818 97,640,313

(Continued)

58



The Operational Risk Manual of each entity outlines the policies, standards and procedures that guaran-tee business management within the proper risk levels. They also have the Continuity Management System Manual for the operation in the event that it does not have basic resources available. Each financial entity keeps a detailed log of its Operational Risk events, which are recorded in the expenses accounts assigned for the correct monitoring of accounts.

The Operational Risk Units (GRO, for the Spanish original) take part in the organization's activities through their involvement in the Committees created to monitor management and compliance with the entity's regulations, which can be: strategic, tactical, preventive, to monitor risk indicators and for complaints and claims. This was achieved using the SARO methodology (risk identification, measurement, control and monitoring) in the implementation of other standards, such as the Sarbanes - Oxley Act (SOX), ISO 27001 (Information Security), Law 1328 on financial consumer protection, the Anti-corruption and Anti-fraud Law and Law 1581 for data protection, among others, thus obtaining important synergies for the entities. At June 30, 2015, the operational risk profile had risks and controls for all the entities' processes. The updating model is dynamic and takes into account the walk tests run on controls, the filtering of ineffective risks and controls (according to audit reports), structural changes, roles, applications and procedures (updates), as well as new processes documented by the Systems and Operations Division. In relation to BAC Credomatic, contained in Leasing Bogotá Panama, the Company has established a minimum framework for operational risk management within its entities, in order to provide general guidelines to ensure the identification, assessment, control, monitoring and reporting of operational risks and events that may affect it, to ensure the proper management, mitigation or reduction of the risks managed and help provide reasonable assurance with regard to the achievement of organizational objectives. The operational risk management model considers the best practices issued by the Basel Committee on Banking Supervision and by COSO (Committee of Sponsoring Organizations of the Treadway Commission). In addition, it meets the regulatory requirements of the region defined by regulatory bodies of the countries where the Company operates. Based on the above, operational risk is defined as the possibility that events resulting from individuals, information technologies or inadequate or failed internal processes; as well as those caused by external events, may generate negative impacts undermining the fulfillment of the entity's objectives and, due to the nature thereof, is present in all the organization's activities. The entity's priority is to identify and manage the main risk factors, regardless of whether or not they can produce monetary losses. Measurement also contributes to the establishment of priorities in the management of operational risk. The operational risk management system is duly documented in the Company's Operational Risk Manual and Guidelines. It is an ongoing multi-phase process:

• Control environment perspective measurement • Identification and assessment of operational risks • Treatment and mitigation of operational risks • Risk monitoring and review • Recording and posting of losses due to operational risk incidents

(Continued)

59



In addition, the Company has established formal policies to manage information security, business continuity, fraud prevention and an ethics code that supports the proper management or operational risks in the organization. In the region and all the countries where the Company operates, there is Operational Risk Management that monitors, assists and assesses the efforts made by Management with regard to operational risks. There is also a specialized Operational Risk Committee (OR Committee) made up of Management. The OR Committee monitors business continuity management, reports to the Comprehensive Risk Management Committee, supervises management efforts and ensures that the operational risks identified are kept within the levels accepted by the Company. Compliance with the Company standards is based on a program for periodic reviews conducted by the Internal Auditing Department, which reports results to the Audit Committee of each entity in which the Company operates. Below is the evolution of the resulting figures of each update of the operational risk profile of each entity during the periods ended on June 30, 2015, and December 31, 2014:

June 30, 2015 December 31, 2014

Entity Processes Risks Controls Processes Risks Controls Banco de Bogotá 180 1,615 4,269 184 1,698 4,595 Porvenir 45 408 777 45 408 788 Casa de Bolsa 50 422 2,563 47 369 2,529 Fiduciaria Bogotá 20 202 2,160 20 209 2,183 Almaviva 19 104 590 17 162 699 Corficolombiana 23 390 800 22 383 800 BAC 656 28,399 2,076 619 28,015 2,076 Banco de Bogotá Panama 65 391 504 66 402 492

Below are the details of the losses recorded due to operational risk events for the Group:

Entity June 30, 2015

December 31, 2014

Banco de Bogotá COP 7,347 7,980 Grupo BAC 5,896 8,049 Almaviva 1,149 1,497 Porvenir 827 433 Fiduciaria Bogotá 40 71 Casa de Bolsa 36 56 Corficolombiana 38 17 Banco de Bogotá Panama 4 45 Total COP 15,337 18,148

v. Risk of Money Laundering and Terrorist Financing

In the regulatory framework of the Colombian Financial Superintendence and specifically following the instructions of the Basic Legal Bulletin, Part I, Title IV, Chapter IV, the Group presents the satisfactory results of its Money Laundering and Terrorist Financing Risk Management System (SARLAFT, for the Spanish original), which are in line with the regulations in force, the policies and methodologies adopted by the Group's highest decision-making body and the recommendations provided in international standards on the matter.

(Continued)

60



Money Laundering and Terrorist Financing Management Activities in regard to SARLAFT were carried out taking into account the methodologies adopted by the Group, to continue mitigating the aforementioned risks. These results were achieved by applying controls designed for each of the risk factors defined in the Basic Legal Bulletin, Part I, Title IV, Chapter IV of the Colombian Financial Superintendence (customer, product, channel and jurisdiction), maintaining an acceptable profile, reflected in the absence of events or situations that go against the Group's good SARLAFT reputation.

Stages of the Money Laundering and Terrorist Financing Management System

Based on the international recommendations and national legislation on SARLAFT, the risks of Money Laundering and Terrorist Financing (ML/TF) identified by the Group are managed as part of the concept of continuous improvement and focused on reasonably minimizing the existence of these risks. The Group has technology tools that enable it to implement the know-your-customer and know-the-market policies, among others, in order to identify unusual transactions and report suspicious transactions to the Financial Analysis and Information Unit (UIAF, for the Spanish original), taking into account the objective criteria established by the Group in the terms established by law. It is important to point out that the Group generates continuous improvements in the elements and mechanisms that support the proper performance of SARLAFT, related to the different applications and analysis methodologies for monitoring and preventing money laundering and terrorist financing risks.

Elements of the Money Laundering and Terrorist Financing Management System

In compliance with the provisions set forth in the legal standards and according to the amounts and characteristics required in Part I Title IV Chapter IV of the Basic Legal Bulletin issued by the Colombian Financial Superintendence, the Group submitted the institutional reports to the Financial Analysis and Information Unit (UIAF) on time. It also provided the competent authorities with the information required in accordance with the legal regulations, given that, as part of the policies, the procedure was established for support and cooperation with the authorities within the legal framework. According to the results of the various stages related to SARLAFT, the Group manages ML/TF risk properly. In the Bank's subsidiaries from the non-financial sector, activities were carried out to promote anti-money laundering systems that make up the portfolio of investments in equity securities, in order to prevent risks of contagion associated with money laundering and terrorist financing that may result from these subsidiaries. During the first half of 2015, the Bank carried on the activities to monitor and assist these companies, through Corficolombiana, in order to implement the system for the self-management and control of the risk of money laundering and terrorist financing (MLTF), established by External Bulletin No. 100-00005 issued on the matter by the Superintendence of Companies in 2014, which indicates that the companies it supervises whose gross revenue during the year 2013 were greater than or equal to COP 160,000 minimum monthly salaries (COP 94,320) are required to comply. Partners of commercial companies are highly interested in the self-management and control system designed by the Superintendence of Companies, because it provides standards and guidelines for them to design and implement internal policies, procedures, methodologies and structures that work in an integrated manner to prevent money laundering or terrorist financing events, damaging the national economy and are a threat to the competitiveness, productivity and sustainability of its subsidiaries.

(Continued)

61



The subsidiaries to which the regulation applies have met the corresponding requirements and they have structured prevention systems within the legal terms.

vi. Legal risk

The Legal Department supports legal risk management efforts implemented to benefit the Group's operations. Specifically, it defines and establishes the necessary procedures to adequately control legal risks of operations, ensuring compliance with legal norms and that they are documented, and it analyzes and drafts contracts to support operations carried out by different business units. In agreement with instructions given by the controlling entity, the Group assessed the claims of the proceedings filed against it based on the analysis and opinions of the lead attorneys, and created the allowances necessary to cover the probability of loss. Note 33 to the financial statements details the proceedings filed against the Group, other than those whose likelihood is remote.

7. Operating Segments Operating segments are defined as a component of an entity: (a) that develops business activities from which it can obtain revenue for the ordinary activities and incur in expenses; (b) with operating revenue that is regularly reviewed by the highest operational decision-making authority of the entity; and (c) about which there is differentiated financial information. In accordance with this definition and that the Board of Directors, the maximum operational decision-making authority, reviews and assesses the consolidated operating revenue on a regular basis, obtaining additional information from the subsidiaries, focused on financial information of the significant entities included in the consolidated entity, the Bank operates through 4 segments corresponding to Banco de Bogotá and its significant subsidiaries: Leasing Bogotá Panama and Subsidiary, Corficolombiana and Subsidiaries, and Porvenir and Subsidiary. See main activity and place of business in Note 1. The following are the main products and services offered at each operating segment, from which they obtain their revenue:

a) Banco de Bogotá It is a credit institution that offers different types of financial services over different periods, mainly: Loans and capital leases, commercial, consumer, mortgage and microcredit loans. The Bank also has a debt and equity investment portfolio, including shareholding in subsidiaries and other entities, and it operates on the currency and derivatives markets.

b) Leasing Bogotá Panama and Subsidiary It is a financial holding in the business of investing activities. It is the owner of 100% of BAC Credomatic Inc, which provides through its subsidiary, BAC International Bank, Inc., a Panamanian bank, a wide variety of financial services such as loans, investments and services related to individuals and institutions mainly in Mexico, Guatemala, Honduras, El Salvador, Nicaragua, Costa Rica and Panama.

(Continued)

62



c) Corficolombiana and Subsidiaries

Corficolombiana provides a broad portfolio of services specialized in private banking, investment banking, cash and debt and equity investments, including holding in subsidiaries and other entities. Through its subsidiaries, Corficolombiana offers capital lease, natural gas and energy transport and distribution services, construction, operation and maintenance of road infrastructure and hotel services, in addition to agroindustrial products, mainly wood, palm oil, rubber and rice.

d) Porvenir and Subsidiary Porvenir manages mandatory pension, severance and voluntary pension funds, as well as private equity of pension liabilities. The operating segments identified above are based on their internal management, considering the economic activity of specialized financial services through the Bank and its subsidiaries. The information of the Bank, its significant and consolidated subsidiaries is reviewed on a quarterly basis by the Bank's Board of Directors and measured according to the accounting standards applicable to the preparation of the financial statements described in Note 3. Below is the information by segment of assets, liabilities, equity, revenue and expenses that must be reported. Assets and Liabilities by Segment

At June 30, 2015

Statement of Financial Position

Banco de Bogotá

Leasing Bogotá Panama

and subsidiary

Porvenir and

subsidiary

Corficol and

subsidiaries Other

subsidiaries Eliminations Consolidated

Cash and cash equivalents COP 5,356,881 7,945,781 41,517 874,607 1,086,157 (383,130) 14,921,813 Financial Investment Assets

6,218,683 5,032,173 1,432,255 4,993,902 1,142,149 (132,942) 18,686,220

Loan portfolio and finance lease transactions

45,755,462 31,772,310 21,722 1,834,744 1,985,978 (122,707) 81,247,509

Coverage derivatives

31,264 10,175 10,118 0 0 0 51,557 Investments in subsidiaries, associates and joint ventures

12,517,436 0 726 782,416 1,974

(12,540,128) 762,424

Other

2,066,696 1,755,742 311,729 6,990,878 200,923 (49,762) 11,276,206 Intangible assets - capital gain

703,268 4,176,771 347,344 2,261,089 7,954 0 7,496,426

Total assets

72,649,690 50,692,952 2,165,411 17,737,636 4,425,135 (13,228,669) 134,442,155 Trading derivatives

387,528 284 506 292,643 (125) 0 680,836

Financial liabilities

54,641,008 37,113,982 6,403,096 13,289,741 (21,817,901) 5,961,103 95,591,029 Coverage derivatives

367,725 3,910 0 0 200 30,075 401,910

Accounts payable and other liabilities

2,949,097 1,288,256 411,165 2,374,483 122,706 (136,481) 7,009,226

Long-term Borrowings

(2,981,085) 3,389,347

(5,902,000) (4,410,566) 25,632,216 (6,499,160) 9,228,752

Long-term outstanding investment securities

3,129,386 982,713 0 1,914,209 (1) 0 6,026,307

Total liabilities COP 58,493,659 42,778,492 912,767 13,460,510 3,937,095 (644,463) 118,938,060

(Continued)

63



At December 31, 2014

Statement of Financial Position

Banco de Bogotá


and subsidiary

Porvenir and

subsidiary

Corficol and

subsidiaries Other


Cash and cash equivalents: COP 5,172,604 7,218,054 63,255 408,599 972,997 (234,581) 13,600,928

Financial Investment Assets 9,606,705 4,715,903 1,267,445 3,245,156 793,942 (3,263,994) 16,365,157

Loan portfolio and finance lease transactions 41,546,476 28,238,434 (12) 1,224,739 1,285,347 (98,873) 72,196,111

Coverage derivatives 12,992 19 51,841 0 0 0 64,852 Investments in subsidiaries, associates and joint ventures 8,168,647 0 0 711,795 107,827 (8,295,883) 692,386

Other 1,994,014 1,634,324 235,331 6,756,987 50,059 (107,007) 10,563,708 Intangible assets - capital gain 612,432 3,839,204 345,934 2,140,354 143,054 0 7,080,978

Total assets 67,113,870 45,645,938 1,963,794 14,487,630 3,353,226 (12,000,338) 120,564,120 Trading derivatives 609,904 422 12 340,426 (283) 0 950,481 Financial liabilities 43,116,294 27,539,767 0 3,731,293 2,751,424 (237,727) 76,901,051 Coverage derivatives 529,207 14,822 17 0 282 27,317 571,645 Accounts payable and other liabilities 2,555,113 1,110,380 329,398 2,371,513 122,401 (57,968) 6,430,837

Long-term Borrowings 3,473,168 9,193,696 445,189 2,308,729 10,449 (177,119) 15,254,112 Long-term outstanding investment securities 3,129,252 846,905 0 1,511,891 (449) (2.448) 5,485,151

Total liabilities COP 53,412,938 38,705,992 774,616 10,263,852 2,883,824 (447,945) 105,593,277 Statement of Income of the Period by Segment

Semester ended on June 30, 2015

Banco de Bogotá


and subsidiary

Porvenir and

subsidiary

Corficol and

subsidiaries Other


Earnings from interest and valuation of debt securities

COP 2,180,286 1,743,488 42,449 194,935 37,002 14,430 4,212,590

Interest expenses 838,382 593,478 12,759 283,699 17,196 (11,758) 1,733,756 Net income from interest and valuation of debt securities 1,341,904 1,150,010 29,690 (88,764) 19,806 26,188 2,478,834

Financial asset allowance 408,543 186,753 16,662 13,887 1,295 0 627,140 Net income from interest after allowance 933,361 963,257 13,028 (102,651) 18,511 26,188 1,851,694

Earnings from commission and other services 409,544 664,906 383,572 33,430 131,986 (4,189) 1,619,249

Commission expenses and expenses of other services 68,335 32,803 14,748 36,955 3,560 (3,041) 153,360

Net income from commission 341,209 632,103 368,824 (3,525) 128,426 (1,148) 1,465,889 Other Income 1,150,589 100,278 37,280 2,508,149 97,779 (920,480) 2,973,595 Share of investments using the equity method 648,062 0 0 85,692 0 (648,278) 85,476

Dividends and shares 216,725 0 0 8,709 15,015 (229,406) 11,043 Other 285,802 100,278 37,280 2,413,748 82,764 (42,796) 2,877,076 Other expenses 894,520 1,154,533 185,695 1,839,368 180,513 (47,593) 4,207,036 Earnings Before Income Tax 1,530,639 541,105 233,437 562,605 64,203 (847,847) 2,084,142

Income tax 324,247 147,106 87,126 148,394 14,755 (40,676) 680,952 Net income COP 1,206,392 393,999 146,311 414,211 49,448 (807,171) 1,403,190

(Continued)

64




Banco de Bogotá


and subsidiary

Porvenir and

subsidiary

Corficol and

subsidiaries Other


Earnings from interest and valuation of debt securities COP 2,018,094 1,332,419 62,570 195,405 21,928 (17,238) 3,613,178 Interest expenses 755,568 474,365 10,711 243,192 14,082 (9,149) 1,488,769 Net income from interest and valuation of debt securities 1,262,526 858,054 51,859 (47,787) 7,846 (8,089) 2,124,409

Financial asset allowance 344,296 212,475 26,052 34,959 (3,075) 0 614,707 Net income from interest after allowance 918,230 645,579 25,807 (82,746) 10,921 (8,089) 1,509,702

Earnings from commission and other services 402,505 521,221 371,200 33,601 147,463 (3,990) 1,472,000

Commission expenses and expenses of other services 65,115 18,698 46,294 14,423 3,542 (3,142) 144,930

Net income from commission 337,390 502,523 324,906 19,178 143,921 (848) 1,327,070 Other Income 730,430 102,893 19,763 2,694,430 86,214 (617,264) 3,016,466 Share of investments using the equity method 0 0 0 79,425 (1) (165) 79,259

Dividends and shares 518,190 0 0 65,253 14,106 (532,151) 65,398 Other 212,240 102,893 19,763 2,549,752 72,109 (84,948) 2,871,809 Other expenses 911,281 921,052 156,138 2,052,689 180,547 (60,360) 4,161,347 Earnings Before Income Tax 1,074,769 329,943 214,338 578,173 60,509 (565,841) 1,691,891

Income tax 317,140 90,482 87,940 187,059 14,173 (77,942) 618,852 Net income COP 757,629 239,461 126,398 391,114 46,336 (487,899) 1,073,039

Below are the details of distribution by geographic areas of Group's revenue and assets on the consolidated level, to be reported:

Semester ended on June 30, 2015

Colombia Panama Guatemala Costa Rica

Other (1) Eliminations Consolidated

Net income COP 7,170,955 839,677 605,114 767,284 332,643 (910,239) 8,805,434 Noncurrent assets other than financial instruments

Property, Plant and Equipment 3,028,544 163,263 90,704 305,542 389,499 (11,394) 3,966,158 Intangible Assets 3,318,736 3,233,480 6,973 38,670 898,567 0 7,496,426 Deferred Income Tax - Assets COP 925,852 22,065 7,779 9,438 19,050 0 984,184

(1) These are for Nicaragua, Honduras, El Salvador, Mexico, the United States and the British Virgin Islands


Colombia Panama Guatemala Costa Rica

Other (1) Eliminations Consolidated

Net income COP 6,760,684 773,468 526,047 587,301 92,636 (638,492) 8,101,644 Noncurrent assets other than financial instruments

Property, Plant and Equipment 3,060,694 151,115 85,111 264,980 352,897 (10,082) 3,904,715 Intangible Assets 3,099,558 2,968,789 6,420 37,261 968,950 0 7,080,978 Deferred Income Tax - Assets COP 978,962 26,736 10,253 9,772 16,093 0 1,041,816

(1) These are for Nicaragua, Honduras, El Salvador, Mexico, the United States and the British Virgin Islands During the semesters that ended June 30, 2015 and December 31, 2014, the Bank and its subsidiaries did not present a concentration of revenue in clients with a share over 10% regarding revenue from ordinary activities. For this purpose, the Bank considers a single client, other than related parties, those that are under common control based on the information available in the Bank. Regarding revenue from related parties, see Note 35.

(Continued)

65



8. Cash and Cash Equivalents

The breakdown of cash and cash equivalents is as follows:

June 30, 2015

December 31, 2014

January 1, 2014

Legal tender Cash COP 1,186,636 1,321,232 838,107

Central Bank of Colombia 3,089,852 2,231,356 2,585,110 Banks and other financial entities 790,155 426,238 1,703,085 Exchange 1,768 90 382 Deposits and investments in debt securities maturing in less than three months

22,680 235,199 761,412

Restricted cash (1) 17,943 74,744 22,326 5,109,034 4,288,859 5,910,422 Foreign Currency Cash 1,174,214 1,100,991 774,064

Central Bank of Colombia 0 21 29 Banks and other financial entities 8,285,251 7,870,975 3,701,777

Exchange 353,314 291,891 240,129 Deposits and investments in debt securities maturing in less than three months

0 48,191 426,826

9,812,779 9,312,069 5,142,825 COP 14,921,813 13,600,928 11,053,247

(1) There is no restricted cash except for that revealed by Corficolombiana and its controlled companies that have restricted cash mainly

related to the collection of tolls associated with the National Infrastructure Agency accounts, which can only be used when all the conditions set forth in the concession agreements have been met.

The credit rating as provided by independent credit rating agencies from the primary financial institutions in which the Group holds cash accounts are established as follows:

June 30,

2015 December 31,

2014 January 01,

2014 Credit Rating Central Bank of Colombia COP 3,089,852 2,231,377 2,585,139 Investment grade 9,075,406 8,297,213 5,404,862 Not rated and not available

2,756,555 3,072,338 3,063,246

COP 14,921,813 13,600,928 11,053,247

9. Financial Investment Assets • At amortized cost

The balance of financial assets at amortized cost at June 30, 2015, December 31, 2014 and January 1 2014, is as follows:

June 30,

2015 December 31, 2014

January 01, 2014

Debt securities In Colombian pesos Issued or guaranteed by the Colombian government COP 5,184,481 3,041,930 2,334,900 Issued or guaranteed by other entities of the Colombian government 1,067,268 1,171,147 1,276,484 Debt securities In Colombian pesos Issued or guaranteed by other financial institutions 0 0 12,921 Other 0 0 2,833 6,251,749 4,213,077 3,627,138

(Continued)

66



June 30,

2015 December 31, 2014

January 01, 2014

In foreign currency Issued by Central Banks 615,262 344,673 186,994 Issued or guaranteed by foreign governments 730,250 695,890 568,174 Issued or guaranteed by the Colombian government 0 0 8,147 Issued or guaranteed by non-financial sector entities 520,318 502,601 427,083 Issued or guaranteed by other entities of the Colombian government 65,394 60,667 53,123 Issued or guaranteed by other financial institutions 599,229 549,976 469,371 Other 18,757 17,709 35,952 2,549,210 2,171,516 1,748,844 Total debt securities COP 8,800,959 6,384,593 5,375,982

At June 30, 2015, financial assets at amortized cost were securing repo transactions for COP 3,621,017 and COP 1,168,257 at December 31 2014. In addition, financial instruments at amortized cost for COP 2,897,631 have been issued as collateral to third parties to support borrowings with other Banks. Credit Rating

Below is a breakdown of credit ratings as provided by independent credit rating agencies from the primary investment counterparties in debt securities in which the Group holds financial assets at amortized cost:

Credit Rating June 30,

2015 December 31, 2014

January 01, 2014

Issued or Underwritten by Central Banks COP 615,262

344,672

186,994 Issued or Underwritten by Governments

5,962,106

3,759,200

2,915,145

Speculative

224,215

246,086

77,619 Investment grade

1,768,989

1,818,526

1,989,287

Multilateral

4,029

3,714

20,487 Not rated and not available

226,358

212,395

186,450

Overall Total COP 8,800,959

6,384,593

5,375,982

Investments at amortized cost time frame

June 30,

2015 December 31, 2014

January 01, 2014

Up to 1 month COP 78,780

457,738

465,093 More than 1 Month and No More than 3 Months

337,189

276,385

155,057

More than 3 Month and No More than 1 Year

2,243,219

1,676,084

1,526,144 More than 1 Year and No More than 5 Years

1,547,468

1,414,964

1,701,354

More than 5 Years and No More than 10 Years

4,034,029

2,252,744

1,316,523 More than 10 Years

560,274

306,678

211,811

Overall Total COP 8,800,959

6,384,593

5,375,982

• Fair Value The balance of financial assets in debt securities and investments in equity instruments at fair value through profit or loss at June 30, 2015, December 31 and January 1, 2014, is as follows:

June 30,

2015 December 31, 2014 January

01, 2014 Debt securities In Colombian pesos Issued or guaranteed by the Colombian government COP 2,224,425 2,464,154 5,525,877 Issued or guaranteed by other entities of the Colombian government 22,601 20,950 99,380 Issued or guaranteed by other financial institutions 373,094 433,260 370,214 Issued or guaranteed by non-financial sector entities 17,196 18,159 23,149 Other 143,193 111,221 97,686 2,780,509 3,047,744 6,116,306

(Continued)

67



June 30,


01, 2014 In foreign currency Issued or guaranteed by the Colombian government 134,117 107,409 18,686 Issued or guaranteed by other entities of the Colombian government 346,554 228,159 176,575 Issued or guaranteed by foreign governments 830,755 827,808 690,673 Issued by Central Banks 226,057 88,998 34,351 Issued or guaranteed by other financial institutions 2,431,747 2,232,288 1,446,275 Issued or guaranteed by non-financial sector entities 368,415 396,854 432,073 Other 131,374 146,539 89,762 4,469,019 4,028,055 2,888,395 Total debt securities 7,249,528 7,075,799 9,004,701

Equity instruments With adjustments in income In Colombian Pesos Corporate Shares 66,744 63,531 62,038 Mutual Funds 493,219 386,529 359,249 Stabilization reserve (1) 870,809 841,271 734,901

1,430,772 1,291,331 1,156,188 In foreign currency Corporate Shares 46 44 39 1,430,818 1,291,375 1,156,227 COP 8,680,347 8,367,174 10,160,928

(1) This is the reserve created by Porvenir, which represents 1% of each fund managed

The balance of financial assets in investments in equity instruments at fair value through other comprehensive income at June 30 2015, December 31 and January 1 2014, is as follows:

June 30,


01, 2014 With adjustments in equity In Colombian Pesos

Corporate Shares COP 691,650 784,053 744,918 In foreign currency

Corporate Shares 3,132 5,324 8,925 Total equity instruments COP 694,782 789,377 753,843

• The breakdown of credit ratings as provided by independent credit rating agencies from the primary

investment counterparties in debt securities and investments in equity instruments is presented below.

June 30,

2015 December 31, 2014

January 01, 2014

Issued or Underwritten by Governments COP 3,395,586 3,485,545 6,244,547 Issued or Underwritten by Central Banks 226,057 88,998 34,351 Multilateral 85,498 96,088 82,750 Investment grade 3,308,050 3,094,061 2,433,734 Speculative 181,774 210,008 144,849 Not rated and not available 52,563 101,099 64,470 Total COP 7,249,528 7,075,799 9,004,701

(Continued)

68



Time frame for investments at fair value

June 30,

2015 December 31, 2014

January 01, 2014

Up to 1 month

131,313 198,649 110,572 More than 1 Month and No More than 3 Months

261,863 178,571 68,935

More than 3 Month and No More than 1 Year

928,461 604,835 745,960 More than 1 Year and No More than 5 Years

3,281,017 2,871,503 5,146,151

More than 5 Years and No More than 10 Years

2,355,101 3,140,579 2,518,254 More than 10 Years

291,773 81,662 414,829

Overall Total

7,249,528 7,075,799 9,004,701

• Impairment of investments Equity Instruments Below is the activity in impairment of investments:

June 30, 2015 December

31, 2014 Initial balance COP 18,860 16,629 Impairment of equity instruments

931 2,593

Reversal of impairment

(872) (189) Exchange difference (106) (173) Final balance (1) COP 18,813 18,860

(1) At December 30, a balance of COP 6,987, classified in other provisions due to standardization adjustments.

10. Financial Derivatives

Trading Derivative Financial Instruments

The following table shows the fair values at the end of the forward contracts, futures contracts and interest rate swaps of securities and foreign currency to which the Group is committed.

June 30, 2015

December 31, 2014

January 1, 2014 Notional

Amount

Fair Value

Notional Amount

Fair Value

Notional Amount

Fair Value

Derivative assets Forward contracts Purchase of foreign currency COP 6,644,897

342,980

5,698,228

614,067

2,098,738

32,195

Sale of foreign currency 1,240,621

17,938

1,714,353

27,954

7,185,386

60,019 Interest Rate Purchase 22,500 3 1,000 6 17,520 48 Interest Rate Sale 264,000 1,702 0 0 678,294 1,423 Purchase of securities 10,000 57 116,500 433 0 0 Sale of securities

122,000 727 456,000 4,934 0 0

8,304,018

363,407

7,986,081

647,394

9,979,938

93,685

Swaps Foreign Currency 101,364

20,091

108,172

20,251

381,378

17,395

Interest Rate

3,058,074

36,042

5,556,782

43,663

1,906,301

21,833 Other

1,976,172

41,440

239,246

22,148

561,341

8,163

5,135,610

97,573

5,904,200

86,062

2,849,020

47,391

Futures contracts Purchase of currency 59,770

1,999

90,913

581

0

0

Foreign currency purchase options 652,270

46,583

1,395,979

89,966

1,131,310

13,260 Spot market transactions

From purchase of securities 6

27

0

(1)

0

0 From sale of securities

40

44

2

1

0

0

Of foreign currency purchase

84,252

309

11,094

(51)

36,757

82 Of foreign currency sale 76,326

191

13,039

61

9,297

10

160,624

571

24,135

10

46,054

92

Total derivative assets 14,312,292

510,133

15,401,308

824,013

14,006,322

154,428

(Continued)

69



June 30, 2015

December 31, 2014


Amount

Fair Value

Notional Amount

Fair Value

Notional Amount

Fair Value

Derivative liabilities Forward contracts (1) Purchase of foreign currency 668,997

8,531

1,475,438

23,049

5,155,582

78,366

Sale of foreign currency 8,054,353

396,682

7,408,258

677,693

2,265,876

35,881 Interest Rate Purchase 15,000

41

24,000

(21)

49,000

45

Interest Rate Sale 170,000

223

115

294

166,230

1,381 Purchase of securities 0

0

10,000

114

0

0

Sale of securities 263,000

701

128,000

275

0

0

9,171,350

406,178

9,045,811

701,404

7,636,688

115,673

Swaps Foreign Currency 636,971

130,746

692,977

107,291

518,486

24,543

Interest Rate

2,925,239

26,780

5,068,533

29,845

3,759,179

23,302 Other 2,072,074

103,712

502,620

66,702

473,319

6,196

5,634,284

261,238

6,264,130

203,838

4,750,984

54,041

Futures contracts Purchase of currency 0

0

23,925

0

0

0

Sale of currency

0

0

359

42

0

0

0

0

24,284

42

0

0

Currency purchase options 654,356

12,899

1,307,461

45,197

1,001,650

24,376

Spot market transactions From purchase of securities

40

53

0

0

0

0

From sale of securities

4

21

0

0

0

0 Of foreign currency purchase 50,693

159

0

0

0

0

Of foreign currency sale 60,386

288

0

0

0

0

111,123

521

0

0

0

0

Total derivative liabilities 15,571,113

680,836

16,641,686

950,481

13,389,322

194,090 Net position COP (1,258,821)

(170,703)

(1,240,378)

(126,468)

617,000

(39,662)

(1) At December 31, 2014, in the asset and liability positions of forward trading contracts, matured derivatives and derivatives pending completion were included at a value of COP 24,606 and COP 31,081, respectively.

The derivative financial instruments contracted by the Group are traded in off-shore and national financial markets. The fair value of the derivative instruments have positive or negative variations as a result of fluctuations in the foreign exchange rates, interest rates or other risk factors, depending on the type of instrument and underlying asset. At June 30, 2015, the Group had obligations to deliver financial assets in debt securities or foreign currency with a fair value of COP 680,836, and receive financial assets or foreign currency with a fair value of COP 510,133. At June 30, 2015, the Group had spot market obligations of transactions in foreign currency of COP 571. The net fair value of these transactions is immaterial. Financial Derivatives for Hedging

The financial derivatives for hedging at June 30, 2015, December 31 2014 and January 1 2014, break down as follows:

June 30, 2015

December 31, 2014


Amount

Fair Value

Notional Amount

Fair Value

Notional Amount

Fair Value

Derivative assets Forward contracts (1) Purchase of foreign currency COP 1,574,932 33,091 48,029 59,282 171,488 743

Sale of foreign currency 402,795 8,291 545,514 5,551 1,475,146 16,343 Purchase of securities 0 0 0 0 0 0 Sale of securities

1,013,101 10,175 95,148 19 265,693 1,127

Other 0 0 0 0 0 0 Total derivative assets 2,990,828 51,557 688,691 64,852 1,912,327 18,213

(Continued)

70



June 30, 2015

December 31, 2014


Amount

Fair Value

Notional Amount

Fair Value

Notional Amount

Fair Value

Derivative liabilities Forward contracts Purchase of foreign currency 0 0 47,850 922 840,271 8,997 Sale of foreign currency 6,968,057 397,800 4,499,878 555,619 1,942,245 31,929 Sale of securities 586,753 2,002 1,642,043 12,152 1,133,400 6,724

7,554,810 399,802 6,189,771 568,693 3,915,916 47,650

Swaps Interest Rate

90,819 2,108 106,752 2,952 122,468 4,941 Futures contracts Sale of currency

0 0 0 0 44,317 1,548

Total derivative liabilities 7,645,629 401,910 6,296,523 571,645 4,082,701 54,139 Net position COP (4,654,801) (350,353) (5,607,832) (506,793) (2,170,374) (35,926)

(1) At December 31, 2014, in the asset and liability positions of forward contracts for hedging, matured derivatives and derivatives pending

completion were included at a value of COP 7,377 and COP 13,280, respectively.

• Details of credit ratings as provided by independent credit rating agencies from the primary investment counterparties in derivative assets are shown below.

Credit Rating June 30,

2015 December 31, 2014

January 01, 2014

Investment grade COP 207,855 353,038 98,252 Speculative 41,476 75,691 15,114 Not rated and not available 312,359 460,137 59,276 Total COP 561,690 888,866 172,642

Banco de Bogotá has decided to use the accounting for hedging from their investments in foreign Subsidiaries and Agencies with obligations in foreign currency, such as those established in paragraphs 72 and 78 from IAS 39 and derivative transactions. These operations have the objective of protecting the Bank from a risk of change generated by the structural positions of their foreign subsidiaries and agencies. The primary position subject to hedging is part of the net foreign investment. The way to register the financial derivatives for hedging in books depends on the type of hedging involved. Gains and losses by the exchange rate of the investment in subsidiaries or affiliates or even these gains or losses by the exchange rate that are not completely eliminated in the consolidation of foreign branches registered in other comprehensive income. Non-derivative instruments for hedging: according to the provisions set forth, financial assets or liabilities that are not derivatives can only be designated as hedging instruments in the case of the covered risk in foreign currency. Likewise, a proportion of the complete instrument for hedging, such as 50% of the notional amount, can be designated as a hedging instrument in a hedging relationship. Due to the above, external debt operations are susceptible to being designated hedging for the investment in subsidiaries and agencies abroad.

(Continued)

71



The effects of the variations in the exchange rate between COP and USD generated by the debt (bonds in USD) are registered in other comprehensive income. Derivatives for hedging: The Board of Directors of the Bank, achieving with their policies to protect the statement of financial position of the exchange risk in the structural positions of the subsidiaries and agencies abroad, authorized the designation of instruments for hedging of a series of derivative operations that are found clearly identified in the utilized application for its registration and reappraisal with the goal of covering against adverse changes in the US dollar against the Colombian peso of the investment indicated previously.

The hedged item is the part of the investment abroad that is not covered by foreign debt (bonds issued in USD). The assets and liabilities of this strategy are converted from dollars into the reporting currency of the Bank at the official exchange rate certified daily by the Colombian Financial Superintendence, which generates earnings or losses in exchange. The part of the gain or loss of the instrument for hedging that is determined to be "effective" is recognized in other comprehensive income; and the "inefficient" part will be recognized in the statement of income. Since the obligations and the foreign investments are registered in the same currency (USD), the hedging is considered to be perfect and, therefore, there isn't any ineffectiveness registered in it. The following provides data, in millions of dollars, of hedging parts and hedge instruments of net investments in foreign businesses on June 30, 2015 and December 31 and January 1, 2014:

Hedging of net investments in businesses abroad

June 30, 2015

December 31, 2014

January 01, 2014

Hedging parts Investments Foreign Subordinates COP 3,122 2,949 2,673

Hedging instruments Forwards 2,112 1,929 1,656 Bonds in USD 993 993 993 Total COP 3,105 2,922 2,649 During the semester ended on June 30, 2015, the part of the gain or loss of the hedge instrument that was determined as an effective hedge is recognized in other comprehensive income and the ineffective portion is recognized in the statement of income. The hedging instrument's gains or losses accumulated in the equity will be reclassified in the statement of income at the moment of total or partial provisions of the foreign business.

(Continued)

72



11. Offsetting Financial Instruments The table below breaks down the financial instruments subject to the offsetting required contractually with related parties at June 30, 2015.

Gross amounts of recognized financial assets

Gross amounts of recognized financial liabilities offset in the statement of

financial position

Net amount of financial assets presented in the statement of

financial position

June 30,

2015 December 31, 2014

January 01,

2014

June 30, 2015

December 31, 2014

January 01, 2014

June 30,

2015 December 31, 2014

January 01,

2014 Assets

Accounts receivable - Forward sale of securities

COP 755,039 582,409 326,834 (667,279) (481,494) (200,247) 87,760 100,915 126,587

Total assets subject to offsetting 755,039 582,409 326,834 (667,279) (481,494) (200,247) 87,760 100,915 126,587

Liabilities Accounts payable - Forward sale of securities 667,279 481,494 200,247 (667,279) (481,494) (200,247) 0 0 0

Total liabilities subject to offsetting COP 667,279 481,494 200,247 (667,279) (481,494) (200,247) 0 0 0

12. Loan portfolio and capital lease transactions at amortized cost

Loan Portfolio by Category

June 30,


01, 2014 Ordinary loans COP 55,617,378 49,540,928 41,394,413 Loans with resources from other institutions 1,267,754 1,538,555 987,719 Non-recourse factoring 26,085 16,495 95,055 Letters of credit, covered 186,972 142,316 443,052 Overdrafts in checking accounts 1,467,851 396,675 340,949 Discounts 202,546 206,568 216,195 Credit cards 8,239,746 7,580,021 5,800,719 Early recoveries 216,195 169,856 412,989 Loans to micro-businesses and SMEs 1,580,263 1,479,536 1,322,292 Microcredits 367,015 353,094 333,591 Home mortgage loans 8,305,852 7,350,329 5,329,057 Employee loans 63,705 65,244 120,259 Foreign loans reimbursable 0 0 775 Construction Loans 582,452 341,704 187,954 Leased out immovable property 1,055,368 1,091,290 580,536 Leased out movable assets 2,106,763 2,405,961 2,027,146 Collateral and guarantees, covered 3,074 23 430,576 Other 1,865,685 1,285,621 1,309,396 Total Gross Loan Portfolio 83,154,704 73,964,216 61,332,673 Financial asset impairment by loan portfolio (1,907,195) (1,768,105) (1,529,183) Total COP 81,247,509 72,196,111 59,803,490

(Continued)

73



Loan portfolio by type of risk The classification of loan portfolios by type of risk is shown below:

Classification June 30,

2015

December 31, 2014

January 01, 2014

Commercial “A” Normal Risk COP 48,304,395

42,365,256

36,074,590 “B” Acceptable Risk 1,161,566 1,019,170 1,221,841 “C” Appreciable Risk 850,574 738,992 623,876 “D” Significant Risk 365,939 335,738 281,479 “E” Risk of Non-recoverability 240,413 218,387 231,600

50,922,887 44,677,543 38,433,386 Consumer “A” Normal Risk 17,930,361

16,135,038

12,892,623

“B” Acceptable Risk 511,713

613,023

346,244 “C” Appreciable Risk 987,538

787,105

475,071

“D” Significant Risk 245,430

363,912

279,707 “E” Risk of Non-recoverability 139,851

110,464

113,785

19,814,893 18,009,542 14,107,430 Microcredit “A” Normal Risk 319,674

305,735

293,193


9,614

8,020 “C” Appreciable Risk 5,634

5,595

5,452


4,653

3,851 “E” Risk of Non-recoverability 27,664

27,428

22,983

Mortgage “A” Normal Risk 7,760,385

6,895,264

4,964,556 “B” Acceptable Risk 134,090

118,311

111,272

“C” Appreciable Risk 414,351

335,270

254,151 “D” Significant Risk 27,296

27,865

21,830

“E” Risk of Non-recoverability 56,893

58,377

52,475 8,393,015 7,435,087 5,404,284 Capital Leases “A” Normal Risk 3,444,393

3,328,083 2,898,266


83,324 95,271 “C” Appreciable Risk 67,741

61,189 37,001


11,068 20,715 “E” Risk of Non-recoverability 6,825

5,355 2,821

3,657,012 3,489,019 3,054,074 Total Loan Portfolio by Rating COP 83,154,704

73,964,216

61,332,673

Individual and collective loan portfolios assessed The following table details the provisions for credit risk impairment recorded at June 30, 2015, December 31 and January 1, 2014, taking into account the way they were calculated, individually for loans greater than COP 2,000 million, and collectively for all other loans. The impaired loan portfolio represents loans with associated credit risk, while the past due loan portfolio considers only the days in arrears or default by the customer (without identifying the existence of associated credit risk). The reserves for the loan portfolio are calculated based on the impaired loan portfolio.

(Continued)

74



The reserves for the loan portfolio are calculated based on the impaired loan portfolio. June 30, 2015

Commercial Consumer Mortgage Microcredit Capital Leases Total

Impairment Loans assessed individually COP 388,362 59 733 0 16,164 405,318 Loans assessed collectively 551,983 823,760 33,253 41,843 51,038 1,501,877 Total Impairment 940,345 823,819 33,986 41,843 67,202 1,907,195 Gross balance of financial assets by loan portfolio

Loans assessed individually 32,809,767 72,004 1,619 0 497,552 33,380,942 Loans assessed collectively 18,113,120 19,742,889 8,391,396 366,897 3,159,460 49,773,762 Total financial assets by loan portfolio COP 50,922,887 19,814,893 8,393,015 366,897 3,657,012 83,154,704

December 31, 2014


Impairment Loans assessed individually COP 403,475 8 0 0 16,273 419,756 Loans assessed collectively 482,623 748,409 17,003 44,377 55,937 1,348,349 Total Impairment 886,098 748,417 17,003 44,377 72,210 1,768,105 Gross balance of financial assets by loan portfolio:

Loans assessed individually 29,801,812 78,019 445 0 575,733 30,456,009 Loans assessed collectively 14,875,731 17,931,523 7,434,642 353,025 2,913,286 43,508,207 Total financial assets by loan portfolio COP 44,677,543 18,009,542 7,435,087 353,025 3,489,019 73,964,216

January 01, 2014

Commercial

Consumer

Mortgage

Microcredit Capital Leases Total

Impairment Loans assessed individually COP 325,571 22 0 0 13,618 339,211 Loans assessed collectively 491,560 586,526 46,525 31,250 34,111 1,189,972 Total Impairment 817,131 586,548 46,525 31,250 47,729 1,529,183 Gross balance of financial assets by loan portfolio

Loans assessed individually 24,146,358 77,770 2,670 0 536,693 24,763,491 Loans assessed collectively 14,287,028 14,029,660 5,401,614 333,499 2,517,381 36,569,182 Total financial assets by loan portfolio COP 38,433,386 14,107,430 5,404,284 333,499 3,054,074 61,332,673

Loan portfolio impairment activity

The table below shows the impairment activity of financial assets by loan portfolio during the semesters ended on June 30, 2015 and December 31, 2014:

June 30, 2015

Classification Commercial

Consumer

Microcredit

Mortgage

Capital Leases

Total

Initial Balance COP 886,098 748,417 44,377 17,003 72,210 1,768,105 Charge-offs of the period (69,033) (408,202) (16,594) (5,917) (2,195) (501,941) Impairment of the period 368,753 628,919 23,092 4,740 27,608 1,053,112 Recovery of impairment credited in the statement of income (253,311) (188,748) (6,565) 4,668 (18,112) (462,068)

(Recovery) credit of provisions with balancing entry in OCI of the period. (639) 20,791 (2,467) 11,796 (12,502) 16,979

Exchange difference 8,477 22,642 0 1,696 193 33,008 Final Balance COP 940,345 823,819 41,843 33,986 67,202 1,907,195

(Continued)

75



December 31, 2014

Classification Commercial

Consumer

Microcredit

Mortgage

Capital Leases

Total

Initial Balance COP 858,131 645,524 39,788 8,269 57,286 1,608,998 Charge-offs of the period (71,374) (361,776) (13,088) (6,220) (1,380) (453,838) Impairment of the period 317,666 573,498 23,508 7,443 29,023 951,138 Recovery of impairment credited in the statement of income (237,127) (143,593) (5,831) 3,470 (13,443) (396,524)

(Recovery) credit of provisions with balancing entry in OCI of the period. (14,103) (20,933) 0 3,030 0 (32,006)

Exchange difference 32,905 55,697 0 1,011 724 90,337 Final Balance COP 886,098 748,417 44,377 17,003 72,210 1,768,105

Loan Portfolio by Maturity The table below shows the loan portfolio distribution in the Group by maturity: June 30, 2015

Up to 1

Year 1 to 3 Years

3 to 5 years

More than 5 Years

Total

Commercial COP 25,462,473

9,917,596

6,706,011

8,836,807

50,922,887

Consumer 8,856,388

4,167,000

2,607,692

4,183,813

19,814,893 Mortgage 80,259

201,199

250,679

7,860,878

8,393,015

Microcredit 182,074

164,027

20,169

627

366,897 Capital Leases 971,628

966,950

820,638

897,796

3,657,012

Total COP 35,552,822

15,416,772

10,405,189

21,779,921

83,154,704

December 31, 2014

Up to 1

Year 1 to 3 Years

3 to 5 years

More than 5 Years

Total


9,259,745

5,989,012

7,684,308

44,677,543

Consumer 8,175,901

3,936,611

2,319,235

3,577,795

18,009,542 Mortgage 83,570

183,445

232,917

6,935,155

7,435,087

Microcredit 169,591

159,837

23,075

522

353,025 Capital Leases 1,023,169

965,217

742,757

757,876

3,489,019


14,504,855

9,306,996

18,955,656

73,964,216

January 01, 2014

Up to 1

Year 1 to 3 Years

3 to 5 years

More than 5 Years

Total


8,326,893

4,692,802

5,418,185

38,433,386

Consumer 8,766,561

3,320,297

1,671,681

348,891

14,107,430 Mortgage 65,997

120,198

169,364

5,048,725

5,404,284

Microcredit 146,769

155,259

30,711

760

333,499 Capital Leases 1,131,755

837,246

596,313

488,760

3,054,074


12,759,893

7,160,871

11,305,321

61,332,673

(Continued)

76



Loan Portfolio by Type of Currency Below are the loan portfolios by currency:

June 30, 2015 December 31, 2014 January 01, 2014

Domestic Currency

Foreign Currency

Total Domestic Currency

Foreign Currency

Total Domestic Currency

Foreign Currency Total


22,236,635

50,922,887

25,753,186

18,924,357

44,677,543

23,010,224

15,423,162

38,433,386 Consumer 8,472,617

11,342,276

19,814,893

8,090,046

9,919,496

18,009,542

6,959,695

7,147,735

14,107,430

Mortgage 1,518,909

6,874,106

8,393,015

1,297,518

6,137,569

7,435,087

760,498

4,643,786

5,404,284 Microcredit 366,897

0

366,897

353,025

0

353,025

333,499

0

333,499

Capital Leases 2,965,955

691,057

3,657,012

2,894,702

594,317

3,489,019

2,617,405

436,669

3,054,074

Total Loan Portfolio COP 42,010,630

41,144,074

83,154,704

38,388,477

35,575,739

73,964,216

33,681,321

27,651,352

61,332,673

Non-impaired loans past due The following is a list of the non-impaired loans past due:

June 30, 2015

Current non-

impaired loans

From 1 to 30 Days

From 31 to 60 Days

From 61 to 90 Days

Total non-impaired

customers in arrears

Impaired Total Loan

Portfolio


800,316

124,257

45,101

969,674

619,096

50,922,887 Consumer 18,258,403

624,567

294,423

87,366

1,006,356

550,134

19,814,893

Mortgage 8,051,241

152,790

63,690

3,366

219,846

121,928

8,393,015 Microcredit 272,527

50,200

9,133

5,585

64,918

29,452

366,897


305,905

24,022

3,857

333,784

54,743

3,657,012 Total COP 79,184,773

1,933,778

515,525

145,275

2,594,578

1,375,353

83,154,704

December 31, 2014

Current non-

impaired loans

From 1 to 30 Days

From 31 to 60 Days

From 61 to 90 Days

Total non-impaired


Impaired Total Loan

Portfolio


420,138

148,731

83,154

652,023

541,580

44,677,543 Consumer 16,741,380

444,912

247,004

78,575

770,491

497,671

18,009,542

Mortgage 7,185,948

58,872

68,203

1,815

128,890

120,249

7,435,087 Microcredit 266,661

42,000

9,040

5,313

56,353

30,011

353,025


232,351

11,530

9,963

253,844

32,756

3,489,019 Total COP 70,880,348

1,198,273

484,508

178,820

1,861,601

1,222,267

73,964,216

January 01, 2014

Current non-

impaired loans

From 1 to 30 Days

From 31 to 60 Days

From 61 to 90 Days

Total non-impaired


Impaired Total Loan

Portfolio


410,607

77,630

45,719

533,956

450,812

38,433,386 Consumer 12,989,073

372,103

223,463

68,465

664,031

454,326

14,107,430

Mortgage 5,161,050

35,062

89,018

600

124,680

118,554

5,404,284 Microcredit 259,761

36,169

7,775

5,326

49,270

24,468

333,499


207,953

8,116

1,733

217,802

27,670

3,054,074 Total COP 58,667,104

1,061,894

406,002

121,843

1,589,739

1,075,830

61,332,673

(Continued)

77



Loan Portfolios Assessed Individually The table below shows the breakdown of the loans individually by impairment at June 30, 2015, December 31 and January 1, 2014: June 30, 2015

Gross value

recorded Collateral

Guarantees Constituted impairment

With no impairment recorded

Commercial COP 44,932

44,932

0

Subtotal

44,932

44,932

0

With impairment recorded Commercial

2,874,285

314,784

388,362 Consumer

521

0

59

Mortgage

2,128

0

733 Capital Leases

497,537

0

16,164

Subtotal

3,374,471

314,784

405,318

Totals Commercial

2,919,217

359,716

388,362 Consumer

521

0

59

Mortgage

2,128

0

733 Capital Leases

497,537

0

16,164

Total COP 3,419,403

359,716

405,318 December 31, 2014

Gross value

recorded Collateral


With no impairment recorded Commercial COP 15,391

15,391

0

Subtotal

15,391

15,391

0 With impairment recorded

Commercial

2,238,947

61,046

403,475 Consumer

361

0

8

Capital Leases 541,121 0 16,273 Subtotal

2,780,429

61,046

419,756

Totals Commercial

2,254,338

76,437

403,475 Consumer

361

0

8

Capital Leases 541,121 0 16,273 Total COP 2,795,820

76,437

419,756

January 01, 2014

Gross value

recorded Collateral


With no impairment recorded Commercial COP 17,394

17,394

0

Subtotal

17,394

17,394

0

With impairment recorded Commercial

1,913,444

51

325,571 Consumer

636

0

22

Capital Leases

536,693

0

13,618 Subtotal

2,450,773

51

339,211

(Continued)

78



January 01, 2014

Gross value

recorded Collateral


Totals Commercial

1,930,838

17,445

325,571 Consumer

636

0

22

Capital Leases

536,693

0

13,618 Total COP 2,468,167

17,445

339,211

Financial Sector Loan Portfolio

The following is the breakdown of the loan portfolio by economic sector:

June 30, 2015

Sector Commercial Consumer Microcredit Mortgage Capital Leases Total

Share %

Agriculture, livestock, hunting, forestry and fishing COP 2,034,412

161,923

22,809

16,031

140,260

2,375,435

3.00%

Capital investor 107,697

253,982

3,042

49,026

32,071

445,818

1.00% Salaried Employee 448,768

17,244,712

36,453

7,918,789

330,231

25,978,953

31.00%

Mining and quarrying 1,273,605

8,719

237

2,665

99,974

1,385,200

2.00% Manufacturing industries 9,518,220

143,148

40,273

24,271

597,200

10,323,112

12.00%

Supply of electricity, gas, steam and air conditioning 2,568,143

519

86

100

15,200

2,584,048

3.00%

Water distribution; wastewater evacuation and treatment, waste management and environmental sanitation activities

110,829

4,605

1,295

466

22,447

139,642

0.00%

Construction 3,577,315

88,724

3,619

15,096

229,549

3,914,303

5.00% Wholesale and Retail; Automobile and motorcycle repair 9,485,255

607,945

180,270

97,266

630,684

11,001,420

13.00%

Transport, storage 3,895,066

270,537

14,641

48,587

381,113

4,609,944

6.00% Lodging and catering services 756,280

63,353

22,024

11,403

48,605

901,665

1.00%

Information and communications 1,007,042

21,848

3,113

4,936

65,970

1,102,909

1.00%

Financial and insurance activities 4,317,836

8,323

131

2,980

22,838

4,352,108

5.00%

Real estate activities 2,415,215

28,063

512

5,389

176,818

2,625,997

3.00% Professional, scientific and technical activities 3,669,063

625,888

22,994

151,050

350,952

4,819,947

6.00%

Administrative services and support activities 817,212

31,502

3,214

5,735

83,575

941,238

1.00%

Public administration and defense; social security plans with mandatory enrollment 1,045,040

0

0

0

1,745

1,046,785

1.00%

Education 510,589

18,841

803

6,455

151,808

688,496

1.00% Human health care and social assistance activities 611,442

67,988

920

27,056

137,323

844,729

0.00%

Artistic, entertainment and recreational activities 140,421

135,371

1,224

1,154

17,100

295,270

0.00%

Other service activities 2,515,670

28,211

9,189

4,560

121,436

2,679,066

3.00% Activities of individual households as employers 34

577

21

0

0

632

0.00%

Activities of extraterritorial organizations and entities 97,733

114

27

0

113

97,987

0.00%

Total by economic sector COP 50,922,887

19,814,893

366,897

8,393,015

3,657,012 83,154,704

(Continued)

79



December 31, 2014


Share %


155,604

20,883

13,286

136,681

1,930,659

3.00%


240,125

2,738

42,968

30,347

434,907


15,556,376

36,053

7,054,378

317,787

23,525,445

32.00%


8,299

190

744

122,212

1,485,927


137,209

37,867

21,647

613,047

9,508,798

13.00%


308

56

0

26,270

2,892,556

4.00%


128,556

4,219

1,263

405

17,774

152,217

0.00%


81,692

3,513

13,479

317,158

4,101,528

6.00% Wholesale and Retail; Automobile and motorcycle repair 9,630,228

577,945

175,358

82,737

553,060

11,019,328

15.00%


253,322

14,194

42,766

410,149

3,610,540


60,489

21,167

9,181

42,798

835,154

1.00%

Information and communications 970,283

20,646

2,758

3,940

50,753

1,048,380

1.00%


7,832

134

2,344

25,400

3,523,702

5.00%


27,396

466

4,992

160,795

2,208,134


608,773

22,217

101,791

132,734

2,347,491

3.00%


28,284

2,811

4,925

82,350

790,797

1.00%

Public administration and defense; social security plans with mandatory enrollment 996,436

0

0

0

2,571

999,007

1.00%

Education 313,957

18,490

863

6,103

42,127

381,540


63,634

900

23,956

223,709

859,277

1.00%


116,611

1,157

919

17,746

267,145

0.00%


41,607

8,390

4,526

162,310

1,964,035


570

27

0

0

632

0.00%


111

20

0

1241

77,017

0.00%


18,009,542

353,025

7,435,087

3,489,019 73,964,216

January 01, 2014


Share %


145,196

18,079

7,086

93,628

1,658,275

3.00%


211,694

2,096

26,244

26,691

360,046


11,904,335

36,306

5,204,745

164,262

18,237,882

30.00%


8,127

181

542

113,263

1,351,990


118,035

32,518

11,622

560,025

8,472,698

14.00%


291

60

0

98,062

2,084,607

3.00%


147,180

3,866

1,031

63

10,259

162,399

0.00%


66,302

3,673

7,618

346,964

3,725,628

6.00%

(Continued)

80



January 01, 2014


Share %

Wholesale and Retail; Automobile and motorcycle repair 7,453,970

636,319

170,189

45,605

439,879

8,745,962

14.00%


229,355

15,722

21,289

423,801

3,227,381


51,868

20,272

3,276

32,170

683,790

1.00%

Information and communications 846,208

16,459

2,501

2,286

43,247

910,701

1.00%


6,371

133

466

26,934

3,262,039

5.00%


23,404

533

2,708

110,768

1,548,648


518,460

18,059

48,184

101,000

1,720,633

3.00%


20,983

1,969

1,325

76,651

662,717

1.00%

Public administration and defense; social security plans with mandatory enrollment 939,865

0

0

0

4,421

944,286

2.00%

Education 248,853

16,848

828

3,858

37,076

307,463


49,127

854

15,112

178,903

764,595

1.00%


49,589

1,046

281

13,410

163,512

0.00%


30,255

7,440

1,974

151,660

2,170,682


518

9

0

0

550

0.00%


28

0

0

1,000

166,189

0.00%


14,107,430

333,499

5,404,284

3,054,074 61,332,673

Loan portfolio by debtor's geographic location The following shows the details of the loan portfolio by debtor's geographic location:

June 30, 2015


Colombia COP 31,560,215

8,472,617

1,518,909

366,897

2,996,582

44,915,220 Panama 5,007,340 2,236,997 1,587,666 0 150,099 8,982,102 United States 3,992,932 0 0 0 0 3,992,932 Other countries 10,362,400 9,105,279 5,286,440 0 510,331 25,264,450 Total COP 50,922,887

19,814,893

8,393,015

366,897

3,657,012

83,154,704

December 31, 2014



8,090,046

1,297,518

353,025

2,923,998


18,009,542

7,435,087

353,025

3,489,019

73,964,216

January 01, 2014



6,959,695

760,498

333,499

2,652,767


14,107,430

5,404,284

333,499

3,054,074 61,332,673

(Continued)

81



Loan portfolio by type of collateral The details of the loan portfolio by type of collateral at June 30, 2015, December 31 2014 and January 1 2014 are as follows: June 30, 2015

Commercial Consumer Mortgage Microcredit

Capital Leases Total

Unsecured loans COP 33,381,602 16,417,960 0 229,384 664,582 50,693,528 Collateralized loans: Homes 8,002,527 611,995 8,336,657 6,535 615,927 17,573,641 Other real estate 172,584 0 0 0 1,815 174,399 Deposits in cash or cash equivalents 256,991 1,744,206 0 0 616,379 2,617,576 Other Assets 1,221,304 257,315 54,857 20,782 564,302 2,118,560 Trusts, Stand By, Guarantee Funds 4,699,605 46,833 304 108,829 1,188,877 6,044,448 Pledges 3,188,274 736,584 1,197 1,367 5,130 3,932,552 Total COP 50,922,887 19,814,893 8,393,015 366,897 3,657,012 83,154,704

December 31, 2014


Unsecured loans COP 28,719,048 15,046,219 0 226,261 680,978 44,672,506 Loans underwritten by other banks

481,485 339 0 0 0 481,824

Collateralized loans: Homes 6,625,730 503,114 7,386,701 5,195 546,480 15,067,220 Other real estate 141,368 0 0 0 6,386 147,754 Deposits in cash or cash equivalents 181,458 1,519,957 0 0 519,176 2,220,591 Other Assets 1,375,114 220,793 46,524 19,628 603,386 2,265,445 Trusts, Stand By, Guarantee Funds 4,320,865 34,378 733 100,722 1,128,844 5,585,542 Pledges 2,832,475 684,742 1,129 1,219 3,769 3,523,334 Total COP 44,677,543 18,009,542 7,435,087 353,025 3,489,019 73,964,216

January 01, 2014

Commercial Consumer Mortgage Microcredit

Capital Leases Total

Unsecured loans COP 25,393,982 11,875,971 628 221,600 1,206,087 38,698,268 Loans underwritten by other banks 422,872 0 0 0 0 422,872 Collateralized loans: Homes 5,042,709 347,572 5,392,239 6,173 322,506 11,111,199 Other real estate 82,455 0 0 0 4,293 86,748 Deposits in cash or cash equivalents 41,964 1,111,459 0 0 368,127 1,521,550 Other Assets 1,807,814 221,341 9,171 17,195 583,318 2,638,839 Trusts, Stand By, Guarantee Funds 3,487,634 32,548 1,118 86,859 565,702 4,173,861 Pledges 2,153,956 518,539 1,128 1,672 4,041 2,679,336 Total COP 38,433,386 14,107,430 5,404,284 333,499 3,054,074 61,332,673

Loan portfolio Financial leases The table below shows the reconciliation between the gross investment in financial leases and the present value of the minimum payments receivable at June 30 2015, December 31 and January 1 2014:

Financial Lease Agreements June 30,

2015 December 31, 2014

January 01, 2014

Total gross rents for leasing to be received in the future COP 5,043,298 4,211,418 3,470,562

Gross investment in financial lease agreements 5,043,298 4,211,418 3,470,562 Minus unrealized financial income (1,386,286) (722,399) (416,488) Net investment in financial lease agreements COP 3,657,012 3,489,019 3,054,074 Allowance for impairment of net investment in financial lease agreements (67,202) (72,210) (47,729)

(Continued)

82



Loan Portfolio Financial Leases Maturity The table below details the gross investment and the net investment in financial lease agreements receivable at June 30, 2015, December 31 and January 1, 2014:


Gross

Investment Net

Investment

Gross Investment

Net Investment

Gross Investment

Net Investment

Up to 1 Year 258,535 971,628 252,086 1,023,169 535,423 1,131,755 1 to 5 years 3,079,337 1,787,588

2,273,928 1,707,974

1,870,641 1,433,559

More than 5 Years 1,705,426 897,796

1,685,404 757,876

1,064,498 488,760 Total 5,043,298 3,657,012 4,211,418 3,489,019 3,470,562 3,054,074

13. Other accounts receivable

The following table provides the details of accounts receivable:

June 30,

2015 December 31, 2014

January 01, 2014

Service Concession Agreements COP 1,815,145 1,738,599 1,565,709 Sale of goods and services 1,286,765 1,345,301 1,207,258 Collateral Deposits (1) 450,792 405,566 82,729 Taxes 153,277 9,066 42,809 Debtors 75,891 6,251 3,700 Prepayments to contractors and suppliers 62,629 83,166 32,398 Commissions 54,874 53,085 61,932 Purchase and sale agreements 39,801 29,098 34,529 Interest 28,218 27,979 24,264 Insurance claims 26,476 15,592 10,202 Warehouse services 21,410 21,985 24,130 In joint operations 10,382 0 0 Dividends and shares 6,615 39,731 739 Adjustment of income and CREE Tax 2014 (2) 258,598 0 0 Forward compliance 97,654 102,613 128,583 Payments - Credibanco 77,391 161,751 109,472 Transfers to the National Treasury 28,413 27,815 26,779 Managed Pension Funds 27,625 35,115 11,179 Monthly pension benefits 20,302 17,434 8,646 Electronic transfers in process 14,345 118,544 45,433 Corficolombiana Legal Proceedings 10,803 10,803 0 Saving accounts shortfall 3,367 1,972 0 Clearing shortfall 2,257 2,360 1,660 Cash shortfall 120 115 2,664 To Non-financial sector employees 28,869 23,750 18,745 Prepaid expenses 113,549 79,067 56,848 Other 387,120 304,930 404,741 Subtotal 5,102,688 4,661,688 3,905,149 Impairment of other accounts receivable (198,438) (196,655) (139,888) Total COP 4,904,250 4,465,033 3,765,261

(1) At June 30, 2015, December 31 and January 1 2014, deposits in guarantee for derivatives with counterparties abroad with the central

counterparty risk clearing house totaled COP 226,790, COP 310,915 and COP 8,502, respectively.

(2) Corresponding to balances in favor of taxable year 2014, as follows: Income tax for COP 153,809, CREE for COP 14,396 and COP 90,393 for the tax on the restatement of derivatives for hedging (forward) in 2014

(Continued)

83



• The following breakdown details impairment activity at June 30, 2015 and December 31, 2014:

14. Noncurrent Assets Held for Sale

• The following shows the details of noncurrent assets held for sale:

June 30, 2015

Cost

Impairment

Total

Foreclosed Assets Movable assets COP 36,602

(11,121)

25,481

Residential immovable property 52,604

(12,408)

40,196 Non-residential real estate 72,140

(21,563)

50,577

Other 10,633

0

10,633

171,979

(45,092)

126,887 Assets returned from lease contracts Machinery and equipment 1,405

0

1,405

Vehicles 16,660

(191)

16,469 Real estate assets 2,019

0

2,019

20,084

(191)

19,893 Other noncurrent assets available for sale

Land 24,306

0

24,306 Vehicles 6

0

6

Real estate 39,553

0

39,553 Other 29,931

0

29,931

93,796

0

93,796 Total COP 285,859

(45,283)

240,576

December 31, 2014

Cost

Impairment

Total


(10,390)

21,647

Residential immovable property

48,942

(13,655)

35,287 Non-residential real estate

71,827

(20,452)

51,375

152,806

(44,497)

108,309

Assets returned from lease contracts Machinery and equipment

931

0

931 Vehicles

3,327

(125)

3,202

4,258

(125)

4,133

Discontinued Operations Vehicles

574

(574)

0 Real estate

263

(263)

0

837

(837)

0

Other noncurrent assets available for sale Land

33,734

0

33,734

Vehicles

3,355

0

3,355 Real estate

38,994

0

38,994

Other

34,161

0

34,161

110,244

0

110,244

Total COP 268,145

(45,459)

222,686

June 30,

2015

December 31, 2014

Initial balance COP 196,655 158,254 Impairment

38,361 61,540

Charge-offs

(34,738) (23,164) Recoveries

(2,653) (1,466)

Exchange difference 813 1,491 Final balance COP 198,438 196,655

(Continued)

84



January 01, 2014

Cost

Impairment

Total


(7,417)

8,811

Residential immovable property

34,152

(8,726)

25,426 Non-residential real estate

81,220

(13,396)

67,824

131,600

(29,539)

102,061

Assets returned from lease contracts Machinery and equipment

402

0

402 Vehicles

244

(58)

186

646

(58)

588

Discontinued Operations Vehicles

759

(759)

0 Real estate

263

(263)

0

Other

148

(148)

0

1,170

(1,170)

0

Other noncurrent assets available for sale Land

94,810

0

94,810

Vehicles

170

0

170 Real estate

5,636

0

5,636

Other

102,255

0

102,255

202,871

0

202,871

Total COP 336,287

(30,767)

305,520

• The table below details the liabilities associated with assets held for sale:

June 30, 2015

December 31, 2014

January 01, 2014

Commercial accounts payable COP 6,305 2,437 377 Other accounts payable 11 0 0 Total COP 6,316 2,437 377

• The table below lists the non-current assets available for sale for the semesters that ended on June 30, 2015

and December 31, 2014:

Noncurrent Assets Held for Sale

Balances at June 30, 2014 COP 335,292 Increases due to acquisitions during the period 41,732 Cost of NCAHS sold, net (181,289) Charge-offs (6,764) Reclassifications 47,299 Exchange difference 31,875

Balances at December 31, 2014 268,145 Increases due to acquisitions during the period 51,283 Cost of NCAHS sold, net (44,611) Charge-offs (4,969) Exchange difference 16,011

Balances at June 30, 2015 COP 285,859

(Continued)

85



• The following table shows the activity of impairment for foreclosed assets:

Foreclosed Assets

Assets Returned from Lease Contracts

Discontinued Operations Total

Balances at June 30, 2014 COP 30,515 160 894 31,569 Devaluation charged to expenses

7,577 108 0 7,685

Impairment used in sales

0 0 (22) (22) Recoveries

(100) (243) (35) (378)

Exchange difference 6,505 100 0 6,605 Balances at December 31, 2014

44,497 125 837 45,459

Devaluation charged to expenses

4,973 209 0 5,182 Recoveries

(7,122) (116) (837) (8,075)

Exchange difference

2,744 (27) 0 2,717 Balances at June 30, 2015 COP 45,092 191 0 45,283

• The following table shows the details of foreclosed and returned assets by duration:

Under 2 2 to 3 Years

3 to 5 years

More than 5 Years Total

Impairment

Balance at June 30, 2015

Foreclosed assets: Real estate COP 82,038 10,174 12,214 20,318 124,744 (33,971)

Movable assets

36,379 77 55 91 36,602 (11,121) Other 10,633 0 0 0 10,633 0

Total

129,050 10,251 12,269 20,409 171,979 (45,092)

Assets returned from lease contracts Real estate

2,019 0 0 0 2,019 0

Movable assets

17,383 341 0 341 18,065 (191) Total COP 19,402 341 0 341 20,084 (191)

Balances at December 31, 2014

Foreclosed assets: Real estate COP 78,880 10,079 15,311 16,499 120,769 (34,107) Movable assets

31,520 93 74 350 32,037 (10,390)

Total

110,400 10,172 15,385 16,849 152,806 (44,497)

Assets returned from lease contracts Movable assets 901 30 0 0 931 (125) Vehicles

2,986 0 0 341 3,327 0

Total COP 3,887 30 0 341 4,258 (125) Sales Plan The Group has taken the steps listed below for the sale of noncurrent assets held for sale: • There is a sales force specialized in real estate, to promote sales, support the sales areas in handling

proposals, visiting regions on a periodic basis to strengthen the sale of real estate, support efforts to comply with and apply city planning regulations and attend committee meetings to address and monitor the different business in progress.

(Continued)

86



• The sales force and management visit the properties for sale on a periodic basis in order to identify the strengths of each property, as well as the sale potential and condition thereof, making sales management more effective.

• Sales are promoted through announcements in the main national newspapers and the entity's flyer of Real Estate offerings. In the case of Banco de Bogotá, an associative advertising agreement was signed with "El Tiempo" newspaper for posting the properties, which has led to satisfactory volumes of clients contacted through this medium. In addition, "El Tiempo" publishes the Bank's postings in the Portafolio and ADN newspapers, and the Cambio magazine. "El Tiempo" charges a commission of 1% on the sale of the properties posted. Information is sent directly to potential clients and the list of properties is published on the Bank's website, www.bancodebogota.com.co.

15. Property, Plant and Equipment

The table below details the property, plant and equipment:

June 30, 2015

Cost Accumulated Depreciation Impairment Net

Land COP 672,461

0

0

672,461 Buildings and constructions

1,515,323

(234,075)

0

1,281,248

Machinery and transportation equipment

542,412

(22,337)

(695)

519,380 Vehicles

59,821

(27,012)

0

32,809

Office equipment and furniture

558,609

(303,271)

0

255,338 Computers

750,637

(444,332)

0

306,305

Networks, lines and cables

326,579

(30,230)

0

296,349 Gas Pipelines

439,493

(105,975)

0

333,518

Leasehold improvements

108,622

(7,428)

0

101,194 Ongoing construction

166,282

0

0

166,282

Ongoing imports

1,274

0

0

1,274 Total assets COP 5,141,513

(1,174,660)

(695) 3,966,158

December 31, 2014


Land COP 664,005

0

0


1,430,448

(212,929)

(15)

1,217,504


433,799

(32,959)

0

400,840 Vehicles

94,293

(35,370)

0

58,923


505,486

(263,809)

0

241,677 Computers

690,307

(406,079)

0

284,228


338,453

(15,186)

0


439,570

(19,934)

0

419,636


94,733

(4,974)

0


180,796

0

0

180,796

Ongoing imports

23,947

0

0


(991,240)

(15) 3,904,582

(Continued)

http://www.bancodebogota.com.co/

87



January 01, 2014


Land COP 636,513

0

(8)


1,323,753

(206,583)

(30)

1,117,140


388,174

(9,221)

0

378,953 Vehicles

67,627

(18,359)

0

49,268


463,424

(238,472)

0

224,952 Computers

531,830

(305,994)

0

225,836


308,521

0

0


413,617

0

0

413,617


70,052

0

0


134,389

0

0

134,389

Ongoing imports

12,021

0

0


(778,629)

(38) 3,571,254

Below is the activity of the cost of property, plant and equipment:

Balances at June

30, 2015

Exchange difference

Additions

Disposals Reclassifications

Balances at

December 31, 2014

Land COP 672,461 15,814 399 (4,141) (3,616) 664,005 Buildings and constructions

1,515,323 37,638 55,120 (1,578) (6,305) 1,430,448


542,412 2,304 55,239 (33,034) 84,104 433,799

Vehicles

59,821 3,963

2,605 (12,173) (28,867) 94,293 Office equipment and furniture

558,609 39,313

33,578 (13,919) (5,849) 505,486

Computers

750,637 25,938

52,549 (19,384) 1,227 690,307 Networks, lines and cables

326,579 0

0 (12,915) 1,041 338,453

Gas Pipelines

439,493 0

0 (77) 0 439,570 Leasehold improvements

108,622 15,949 3,548 (6,727) 1,119 94,733

Ongoing construction

166,282 (14,180) 29,061 (13,071) (16,324) 180,796 Ongoing imports

1,274 0 0 0 (22,673) 23,947

Total assets COP 5,141,513 126,739 232,099 (117,019) 3,857 4,895,837

Balances at

December 31, 2014

Exchange difference

Additions

Disposals Reclassifications

Balance at June

30, 2014

Land COP 664,005 44,111 7,754 (10,093) 14 622,219 Buildings and constructions

1,430,448 71,398 119,790 (46,159) 2,908 1,282,511


433,799 30,264 18,747 (35,761) (1,345) 421,894

Vehicles

94,293 12,064 12,798 (4,743) 1,829 72,345 Office equipment and furniture

505,486 27,662 27,810 (21,454) 14,333 457,135

Computers

690,307 117,633 52,399 (9,908) (1,087) 531,270 Networks, lines and cables

338,453 0 9,322 0 0 329,131

Gas Pipelines

439,570 0 2,136 0 0 437,434 Leasehold improvements

94,733 25,341 3,666 (4,311) 9 70,028

Ongoing construction

180,796 (4,360) 32,193 (7,441) (16,769) 177,173 Ongoing imports

23,947 0 10,622 0 107 13,218

Total assets COP 4,895,837 324,113 297,237 (139,870) (1) 4,414,358

(Continued)

88



Below is the activity of the depreciation of property, plant and equipment:

Balances at June

30, 2015 Exchange difference Depreciation

Disposals / Sales Reclassifications

Balances at

December 31, 2014

Buildings and constructions COP 234,075 2,018 25,583 (4,127) (2,328) 212,929 Machinery and transportation equipment

22,337 20 1,473 (131) (11,984) 32,959

Vehicles

27,012 1,770 4,116 (3.909) (10,335) 35,370 Office equipment and furniture

303,271 10,538 28,094 (4,195) 5,025 263,809

Computers

444,332 24,604 46,699 (17,856) (15,194) 406,079 Networks, lines and cables

30,230 0 2,371 0 12,673 15,186

Gas Pipelines

105,975 0 3,453 0 82,588 19,934 Leasehold improvements

7,428 0 7,204 0 (4,750) 4,974

Total COP 1,174,660 38,950 118,993 (30,218) 55,695 991,240

Balances at

December 31, 2014

Exchange difference Depreciation

Disposals / Sales Reclassifications

Balances at June

30, 2014 Buildings and constructions COP 212,929 13,171 28,606 (10.136) (42,594) 223,882 Machinery and transportation equipment

32,959 22 982 (446) 12,996 19,405

Vehicles

35,370 4,954 4,216 (1,427) 5,947 21,680 Office equipment and furniture 263,809 31,831 25,098 (14,713) (12,674) 234,267 Computers

406,079 61,442 41,941 (15,438) 16,646 301,488


15,186 0 2,612 0 4,119 8,455 Gas Pipelines

19,934 0 3,323 0 5,239 11,372


4,974 0 2,489 0 0 2,485 Total COP 991,240 111,420 109,267 (42,160) (10,321) 823,034

At June 30, 2015 and December 31, 2014, there was no restriction on the ownership of the property, plant and equipment.

16. Biological Assets

In accordance with International Accounting Standard (IAS) 41 Agriculture, agricultural activities related to biological assets (animals or plants) are recorded separately in this account, at the time of initial recognition as well as at the end of the reporting period, at fair value minus cost of disposal, except in the case of crops in the period of growth, when for some reason their fair value cannot be measured reliably. In this case, they are measured at cost minus any accumulated impairment loss, or for short-term crops in which their fair value minus cost of sale are reflected in the statement of income by their sale. The gains or losses arising in the initial and subsequent recognition at fair value of agricultural products are included in the net gain or loss of the accounting period. Costs incurred in the agricultural production process are also taken directly to the statement of income.

(Continued)

89



Biological Assets The table below details the biological assets at June 30, 2015, December 31 and January 1, 2014:

Assets Biological

Balance at January 01, 2014 COP 201,183 Balance at June 30, 2014 206,094

Purchases or expenses capitalized (net) 6.392 Disposals / Sales (net) (1,141) Changes in fair value (8,946)

Balance at December 31, 2014 202,399 Purchases or expenses capitalized (net) 21.071 Disposals / Sales (net) (8,765) Changes in fair value 326

Balance at June 30, 2015 COP 215,031

June 30, 2015

December 31, 2014

January 01,

2014 African Palm

in production (at fair value) COP 71,734

71,408

80,314 growing (at cost) 2,079

1,704

3,531

Rubber plantations

in production (at fair value) 124,273

113,247

100,643 growing (at cost) 7,214

6,972

6,320

Other 9,731

9,068

10,375 Total COP 215,031 202,399 201,183

The above amounts are not subject to limitations or restrictions. African Palm The biological assets in African palm account does not include the land where the trees are planted or the plants and equipment used in the harvesting process. The biological process begins with the soil preparation and the planting of the plants, and ends with the harvesting and shipping of the fruit to the oil production plants where the gross crude oil is extracted from the fruit of the palm. The process from the growth of the plant until it begins producing takes approximately 3 to 4 years, and its production process after that lasts approximately 30 years. Note 3 lists the main assumptions of non-observable market data used to value the biological assets of African palm. The following table lists the hectares planted by the Group in the growth process and in the production process at June 30, 2015, December 31, 2014 and January 1, 2014:

June 30,

2015 December 31, 2014

January 01, 2014

Areas planted in hectares COP In the production process 5,389 5,262 4,996 In the growing process 7,215 7,342 5,853 Total COP 12,604 12,604 10,849 Annual production in tons

(Continued)

90



(1) The hectares by expected years of production are broken down below at December 31, 2015:

June 30, 2015

December 31, 2014

January 01,

2014 Hectares planted Less than 1 year COP 127 0 0 1 to 5 years 1,938 1,938 2,262 5 to 10 years 1,626 1,626 1,036 More than 10 Years 1,698 1,698 1,698 Total COP 5,389 5,262 4,996

(2) The table below breaks down the expected time to begin production at December 31, 2015:

June 30,

2015 December 31, 2014

January 01, 2014

Hectares planted Less than 1 year 2,302 1,759 1,007 2 years 937 1,314 413 2 to 4 years 232 106 0 More than 4 Years 3,744 3,744 3,744 Total 7,215 6,923 5,164

During the periods ended on June 30 2015, December 31 and June 30 2014, the Group recorded income and costs on account of biological assets in the statement of income as listed below:

June 30,

2015 December

31, 2014 June 30,

2014 Sales revenue COP 60,571 29,125 26,048 Changes in the fair value of the biological assets 326 (8,946) 4,215 Subtotal 60,897 20,179 30,263 Costs and expenses COP (26,329) (28,247) (24,404) Costs of growth and maintenance (7,574) (9,640) (7,330) General administration and sales expenses (8,891) (5,760) (6,529) Financial expenses (1,753) (3,372) (1,111) Subtotal (44,547) (47,019) (39,374) Total Net Income COP 16,350 (26,840) (9,111)

17. Investment Properties

The details of investment properties are as follows:

June 30, 2015

December 31, 2014

January 01, 2014

Land

Buildings

Total

Land

Buildings

Total

Land

Buildings

Total

Cost COP 166,014 29,323 195,337 119,056 63,084 182,140 106,848 63,493 170,341 Accumulated Depreciation

0 (2,110) (2,110) 0 (1,215) (1,215) 0 (12,747) (12,747)

Total COP 166,014 27,213 193,227 119,056 61,869 180,925 106,848 50,746 157,594

(Continued)

91



Below is the activity of the cost of investment properties:

Land

Buildings

Total

Balance at June 30, 2014 COP 131,277 87,010 218,287 Additions 9,882 5,813 15,695 Reclassifications

(18,182) (29,332) (47,514)

Disposals

(3,921) (407) (4,328) Balances at December 31, 2014

119,056 63,084 182,140

Additions 19,168 0 19,168 Reclassifications

28,806 (32,970) (4,164)

Disposals

(1,016) (791) (1,807) Balances at June 30, 2015 COP 166,014 29,323 195,337

Below is the depreciation activity of investment properties:

Investment Properties

Balances at June 30, 2014 COP 12,523 Depreciation

462

Disposals / Sales

(8) Transfers to noncurrent assets held for sale 204 Adjustments to later measurement

(11,966)

Balances at December 31, 2014

1,215 Depreciation

424

Disposals / Sales

(79) Transfers to noncurrent assets held for sale 550 Balances at June 30, 2015 COP 2,110

Detailed figures included in the statement of income:

June 30,

2015 December 31, 2014

Revenue from income on investment properties COP 1,919 1,549 Direct operating expenses from investment properties generating revenue from income (271) (12) Total COP 1,648 1,537

• No contractual obligations to acquire investment properties, repairs, maintenance or improvements came up during the aforementioned periods.

• There are no restrictions on investing in properties.

• No changes in the fair value of the investment properties came up during the aforementioned periods.

18. Investments in Associates and Joint Ventures

The following table shows the details of investments in associates and joint ventures:

June 30,

2015 December 31, 2014

January 01, 2014

Associates COP 548,330 522,778 420,260 Joint Ventures 214,094 169,608 118,588 Total COP 762,424 692,386 538,848

(Continued)

92



• Details of Investments in Associates and Joint Ventures:


Name Share % Country Share % Country

Investment Share % Country

Associates A Toda Hora 20% Colombia 20% Colombia 20% Colombia Aerocali S.A. 50% Colombia 50% Colombia 50% Colombia Colombiana de Extrusión S.A. Extrucol 25% Colombia 25% Colombia 25% Colombia

Concesionaria Tibitoc S.A. 33% Colombia 33% Colombia 33% Colombia Metrex S.A. 14% Colombia 14% Colombia 14% Colombia Jardín Plaza 18% Colombia 18% Colombia 18% Colombia Ventas y Servicios S.A. 20% Colombia 20% Colombia 20% Colombia C.I. Acepalma S.A. 11% Colombia 11% Colombia 11% Colombia Gases del Caribe S.A. E.S.P. 16% Colombia 16% Colombia 16% Colombia Calidda S.A. 20% Colombia 20% Colombia 20% Colombia Complejo Energético del Este S.A. 17% Colombia 17% Colombia 17% Colombia Energía Eficiente S.A. 19% Colombia 19% Colombia 19% Colombia

Joint Ventures A Toda Hora 25% Colombia 25% Colombia 25% Colombia Concesionaria Ruta del Sol S.A. 33% Colombia 33% Colombia 33% Colombia Concesionaria vial del Pacifico S.A.S. 60% Colombia 60% Colombia 0% Colombia

Concesionaria nueva vía al Mar. S.A.S. 60% Colombia 0% Colombia 0% Colombia

CFC SK Capital S.A.S. 50% Colombia 0% Colombia 0% Colombia CFC SK El Dorado Latam Management Company Ltda. 50% Colombia 0% Colombia 0% Colombia

CFC SK El Dorado Latam Fund. L.P. 50% Colombia 0% Colombia 0% Colombia

CFC SK El Dorado Latam Capital Partners Ltda. 50% Colombia 0% Colombia 0% Colombia

Consorcio Porvenir – Fidubogotá 59% Colombia 59.00% Colombia 59.00% Colombia Consorcio Porvenir – Fidubogotá 60% Colombia 60.00% Colombia 60.00% Colombia UT Porvenir – Fiduciaria BBVA 52.29% Colombia 52.29% Colombia 52.29% Colombia UT Porvenir – Fiduciaria BBVA 71.43% Colombia 71.43% Colombia 71.43% Colombia UT Porvenir – Fidugan 50% Colombia 50.00% Colombia 50.00% Colombia UT Porvenir – Fiduciaria BBVA 50% Colombia 50.00% Colombia 50.00% Colombia

Below is the condensed financial information of investments in associated businesses and joint ventures recorded based on the equity method: Investments in Associates

June 30, 2015

Assets

Liabilities

Equity

Income

Expenses

A Toda Hora COP 54,370 47,023 7,347 892 892 Aerocali S.A.

57,792 23,479 25,148 48,722 34,218

Colombiana de Extrusión S.A. Extrucol

63,942 26,530 37,412 33,947 29,752 Concesionaria Tibitoc S.A.

97,116 36,097 55,500 26,113 16,335

Metrex S.A.

29,039 17,772 11,267 20,178 16,812 Jardín Plaza

111,422 54,608 56,814 13,616 11,419

Ventas y Servicios S.A.

80,065 61,170 18,895 76,435 74,927 Cálidda S.A.

1,871,655 1,186,129 685,526 0 0

Gases del Caribe S.A.

1,864,826 1,192,723 672,104 558,574 494,687 Total COP 4,230,227

2,645,531

1,570,013

778,477

679,042

(Continued)

93



December 31, 2014

Assets

Liabilities

Equity

Income

Expenses

A Toda Hora COP 57,734 50,434 7,300 856 856 Aerocali S.A.

53,290 27,859 25,431 84,766 74,999

Colombiana de Extrusión S.A. Extrucol

76,712 27,547 49,164 25,090 16,565 Concesionaria Tibitoc S.A.

28,055 13,620 14,434 32,708 29,378

Metrex S.A.

64,323 44,987 19,336 0 0 Jardín Plaza

1,664,469 995,743 668,727 0 0


1,730,688 1,095,494 635,195 964,335 774,800 Cálidda S.A.

3,673,833 2,222,444 1,451,389 1,122,787 906,359


53,290 27,859 25,431 84,766 74,999 Total COP 7,402,394

4,505,987

2,896,407

2,315,308

1,877,956

January 01, 2014

Assets

Liabilities

Equity

Income

Expenses

A Toda Hora COP 61,817

55,135

6,682

0

0 Metrex S.A.

25,564

13,102

12,462

0

0


42,792

30,736

12,056

0

0 Cálidda S.A.

1,248,590

778,027

470,563

0

0


1,449,595

805,870

643,725

0

0 Total COP 2,828,358

1,682,870

1,145,488

0

0

Joint Ventures

June 30, 2015

Assets

Liabilities

Equity

Income

Expenses

A Toda Hora COP 54,370 47,023 7,347 892 892 Concesionaria Ruta del Sol S.A.S.

2,627,092 2,030,375 596,716 526,024 421,445

Concesionaria Vial del Pacifico S.A.S.

63,936 60,909 3,028 28,696 27,716 Concesionaria Nueva Vía al Mar S.A.S.

36,807 22,550 14,258 3,880 3,622

CFC SK Capital S.A.S

963 538 425 1,146 722 CFC SK El Dorado Latam Capital Partners Ltda.

85 0 85 288 11

CFC SK El Dorado Latam Management Company Ltda.

657 0 657 3 14

Consorcio Porvenir – Fidubogotá - Fonpet 2012

2,669 2,669 0 2,587 2,587 Consorcio Porvenir – Fidubogotá - Emcali

409 409 0 325 325

UT Porvenir – Fiduciaria BBVA - Fonpet 2012

1,104 3 1,101 366 366 UT Porvenir – Fidugan - EVM-APEV (in process of settlement)

27 9 18 2 2

UT Porvenir – Fiduciaria BBVA - EVM-APEV

181 13 168 88 88 Total COP 2,788,300 2,164,498 623,803 564,297 457,790

December 31, 2014

Assets

Liabilities

Equity

Income

Expenses


2,211,934 1,719,797 492,137 670,441 534,265

Concesionaria Nueva Vía al Mar S.A.S.

21,617 19,569 2,047 8,405 8,358 CFC SK El Dorado Latam Capital Partners Ltda.

163 162 1 0 0

CFC SK El Dorado Latam Management Company Ltda.

1 1 0 9 9


2,318 2,318 0 5,193 5,193 Consorcio Porvenir – Fidubogotá - Emcali

148 148 0 307 307

UT Porvenir – Fiduciaria BBVA - Fonpet 2006 (in process of settlement) 1 1 0 1 1


972 5 967 884 884 UT Porvenir – Fidugan - EVM-APEV (in process of settlement)

26 6 20 26 26


144 13 131 179 179 Total COP 2,295,058 1,792,454 502,603 686,301 550,078

(Continued)

94



January 01, 2014

Assets

Liabilities

Equity

Income

Expenses


2,219,598 1,955,644 263,955 0 0


2,318 2,318 0 0 0 Consorcio Porvenir – Fidubogotá - Emcali

148 48 100 0 0

UT Porvenir – Fiduciaria BBVA - Fonpet 2006 (in process of settlement) 1 0 1 0 0


972 5 967 0 0 UT Porvenir – Fidugan - EVM-APEV (in process of settlement)

26 6 20 0 0


144 13 131 0 0 Total COP 2,285,024 2,013,169 271,856 0 0

The activity of investments in associates is shown below:

June 30, 2015

December 31, 2014

Balance at the beginning of the period COP 523,561 415,264 Fair value of assets and liabilities acquired

20,616 90,484

Share in the year's income

21,447 26,945 Dividends Received

(16,611) (9,132)

Eliminations reciprocal operations

(683) 0 Balance at the end of the period COP 548,330 523,561

The activity of investments in joint ventures is shown below:

June 30,

2015

December 31, 2014

Balance at the beginning of the period COP 165,657 119,523 Fair value of assets and liabilities acquired

45,729 46,134

Balance at the end of the period (1) COP 211,386 165,657

(1) At June 30, 2015 and December 31, 2014, it does not include joint operations in Fiduciaria Bogotá trusts, trusts and consortia of Corficolombiana for COP 2,709 and COP 3,950, respectively

There is no contingent liability in relation to the Group's share in investments in associates and joint ventures.

19. Inventories

The balance of inventories is as follows:

June 30, 2015

Cost Impairment of inventories Net

Cost Realizable net value

Raw materials COP 46,339 (9,555) 36,784 44,631 Assets produced 4,215 (438) 3,777 4,215 Products in process 8,269 0 8,269 4,717 Current contracts 2,227 0 2,227 2,227 Finished Products 13,505 0 13,505 13,841 Goods not manufactured by the company 42,561 0 42,561 36,892 Materials, parts and accessories 18,606 (338) 18,268 13,499 Inventory in transit 9,288 0 9,288 7,932 Total COP 145,010 (10,331) 134,679 127,954

(Continued)

95



December 31, 2014

Cost Impairment of inventories Net

Cost Realizable net value


January 01, 2014

Cost Impairment

of inventories

Net Cost Realizable

net value


20. Intangible Assets

The details of the Group's intangible assets are shown below

June 30, 2015

December 31, 2014

January 01, 2014

Capital Gains COP 5,279,007 4,955,178 4,218,492 Other intangible assets, net

2,217,419 2,125,800 1,898,941

Total COP 7,496,426 7,080,978 6,117,433

i. Assessment Due to Impairment of the Cash-Generating Units with Distribution of Capital Gains

The Group's management assesses the impairment of the capital gains recorded in its consolidated financial statements annually based on studies carried out for this purpose by independent experts hired for said purpose and in accordance with IAS 36 - Impairment of Assets. These studies are conducted based on valuation of the groups of cash-generating units that have the different capital gains assigned in their acquisition, by the discounted future cash flow method, taking into account factors such as: the economic situation of the country and the sector where the acquired entity operates, historical financial information, and forecast growths of the entity's income and costs over the next five years. Then, indefinite growth taking into account their indexes of profit capitalization, discounted at risk-free interest rates that are adjusted by the risk bonuses required in the circumstances of each entity. The methods and assumptions used for the valuation of the different cash-generating units that have capital gains assigned were reviewed by management. Based on this review, it concluded that at

(Continued)

96



December 31, 2014, it was not necessary to record any impairment, taking into account that its recoverable amounts are significantly higher than its book values. Additionally, at June 30, 2015, there were no cash-generating units with distribution of capital gains that had presented impairment ratios, according to analyses conducted to date. The value of the capital gains recorded in the Bank's financial statements was realized after the acquisitions made by the Bank, according to the following details:

Entity June 30,

2015 December 31, 2014

January 01, 2014

Megabanco COP 465,905

465,905

465,905 AFP Horizonte 436,096

436,096

436,096

Bank's direct acquisition 90,162 90,162 90,162 Acquisition through Porvenir 345,934 345,934 345,934

Acquisitions through Corficolombiana 296,263 296,263 295,933 Episol – Panamericana 119,915 119,915 119,915 Hoteles Estelar 6,661 6,661 6,661 Promigas S.A and Subsidiaries 128,819 128,819 128,489 Corficolombiana - Promigas 40,868 40,868 40,868

Leasing Bogotá S.A Panamá: 4,080,743 3,756,914 3,020,558 BAC Credomatic 2,546,602 2,344,515 1,888,216 BBVA Panama 825,794 760,263 612,298 Banco Reformador 596,506 549,170 437,118 Transcom Bank 111,841 102,966 82,926

Total Capital Gains COP 5,279,007

4,955,178

4,218,492

ii. Details of capital gains by acquired entity:

• Capital Gains Banco de Crédito y Desarrollo Social – MEGABANCO S.A. Capital gain was generated due to the acquisition of ninety four point ninety nine percent (94.99%) of the shares of Banco de Crédito y Desarrollo Social – MEGABANCO S.A. This operation was authorized by Resolution Number 917 of June 2, 2006 by the Colombian Financial Superintendence. This capital gain was allocated for the groups of cash-generating units involved in the following lines of business:

Percentage (%) Value

Commercial 32.7% COP 152,539 Consumer 30.8% 143,287 Payroll Loans 27.0% 125,934 Vehicles 6.7% 31,304 Microcredits 2.8% 12,841 Total 100.00% COP 465,905

The last valuation update of the lines of business corresponding to the groups of cash-generating units to which the capital gain was allocated was performed by Incorbank S.A. in its report dated February 19, 2015, and was based on the Bank's financial statements at November 30, 2014, given the merger with the company acquired, and it was concluded that there were no situations indicating possible impairment, since the fair value of COP 11,871,461 resulting from the valuation exceeds the value of COP 5,570,588 recorded in the books of the groups of cash-generating units.

(Continued)

97



Also, the macroeconomic and business conditions used to analyze the impairment of the entity's capital gains at December 31, 2014 have not changed substantially regarding the events up to June 2015 that would indicate a potential impairment of the capital gains. The table below shows the main premises used in the latest impairment studies of the groups of cash-generating units with capital gains assigned, conducted in December 2014 and December 2013, taken as the basis for impairment testing on the dates listed:

June 30, 2015

2015

2016

2017

2018

2019 Assets interest rate on loan portfolio and investments 10.0%

10.5%

10.8%

10.8%

10.9%

Liability interest rate 3.5%

3.7%

3.8%

3.8%

3.8% Growth of income from commissions 16.5%

15.7%

15.5%

15.6%

15.6%

Growth of expenses 19.0%

19.6%

18.2%

15.8%

15.1% Inflation 3.6%

3.2%

3.0%

3.0%

3.0%

Discount rate after taxes 12.3%

Growth rate after five years 3.0%

December 31, 2014

2015

2016

2017

2018


10.5%

10.8%

10.8%

10.9%


3.7%

3.8%

3.8%


15.7%

15.5%

15.6%

15.6%


19.6%

18.2%

15.8%


3.2%

3.0%

3.0%

3.0%



January 1, 2014

2014

2015

2016

2017


10.3%

10.6%

10.7%

10.8%


3.8%

3.9%

3.9%


17.3%

15.7%

15.6%

15.8%


18.0%

18.0%

16.0%


3.0%

3.0%

3.0%

3.0%



To estimate capital gains, a 10-year projection was made using both macroeconomic assumptions, as well as those related to the business listed in the above tables, determined as follows:

• Loan portfolio and investment assets interest rates were projected based on the Bank's historical data

and the projection on the FTD rate. • Liability interest rates were projected taking into consideration the Bank's past performance and the

potential effect of the FTD on these rates. • In turn, estimated growths for commissions and expenses are based on the growth of the loan portfolio

and other transactions estimated by the Bank.

•

(Continued)

98



• The inflation rate used in the projections is based on reports from outside sources such as the

International Monetary Fund and documents from experts such as the projections made by La Nota Económica.

• The growth rate used for the Terminal Value was 3%, which is the rate used in recent studies.

The discount rate after taxes used to discount dividend flows reflects the specific risks relative to each cash generating unit. If the estimated discount rate of 12.34% had been 0.5% higher than the rate estimated in independent studies, there would be no need to reduce the book value of capital gains, since the fair value of the groups of cash-generating units with this sensitivity would be COP 11,215,797, which is much higher than the book value of COP 5,570,588.

• AFP Horizonte Pensiones y Cesantías

The Bank directly acquired sixteen point seventy five percent (16.75%) and indirectly acquired, through its subsidiary, Porvenir, sixty four point twenty eight percent (64.28%) of the shares of AFP Horizonte Pensiones y Cesantías S.A. This transaction was authorized by the Colombian Financial Superintendence, generating an initial capital gain of COP 91,746 and COP 352,081, respectively, with a net amortization value at December 31, 2013 of COP 90,162 and COP 345,934, respectively, corresponding to the attributable cost at January 1, 2014. Following the acquisition, Porvenir absorbed AFP Horizonte Pensiones y Cesantías S.A. The capital gain was allocated to the groups of cash-generating units that together make up Porvenir. The last valuation update of the groups of cash-generating units that make up Porvenir was conducted by PricewaterhouseCoopers. This company issued a report on April 30, 2015 based on the financial statements of Porvenir at December 31, 2014, which concluded that there were no situations indicating possible impairment, since the fair value of COP 3,779,520 exceeds the book value of COP 1,189,179 of the groups of cash-generating units to which the capital gain was allocated. The macroeconomic and business conditions used to analyze the impairment of the entity's capital gains at December 31, 2014 have not changed substantially regarding the events up to June 2015 to indicate a potential impairment of the capital gains. Below are the main premises used in the impairment reports taken as the basis for impairment testing on the dates listed:

June 30, 2015

2015

2016

2017

2018


51.7%

51.7%

51.2%

50.9%


6.3%

6.3%

6.3%


6.6%

6.8%

7.1%

7.0%

Growth of expenses (4.3%)

4.5%

3.1%

5.1%

6.3% Inflation 3.4%

3.0%

3.0%

3.0%

3.0%



(Continued)

99



December 31, 2014

2015

2016

2017

2018


51.7%

51.7%

51.2%

50.9%


6.3%

6.3%

6.3%


6.6%

6.8%

7.1%

7.0%


4.5%

3.1%

5.1%

6.3% Inflation 3.4%

3.0%

3.0%

3.0%

3.0%



January 01, 2014

2014

2015

2016

2017


57.0%

54.3%

51.6%

49.4%


6.0%

6.0%

6.0%

6.0% Growth of income from commissions (5.7%)

8.9%

9.1%

8.2%

8.0%


0.3%

3.7%

5.1%

6.1% Inflation 3.0%

3.1%

3.1%

3.1%

3.1%



To estimate capital gains, a 20-year projection was made using both macroeconomic assumptions, as well as those related to the business of AFP Horizonte Pensiones y Cesantías listed in the above tables, determined as follows: • Loan portfolio and investment assets interest rates and liability interest rates were projected based on

the business' historical data. • Estimated growths for commissions and expenses are based on business growth and other transactions

estimated by the Bank. • The inflation rate used in the projections was taken from various domestic and international sources

such as the International Monetary Fund and the Central Bank. • Finally, the growth rate used for the Terminal Value was 4%, which is the rate used in recent studies. The discount rate after taxes used to discount dividend flows reflects the specific risks relative to each cash generating unit. If the estimated discount rate of 11.5% had been 1.38% higher than the rate estimated in the valuation conducted by external experts, there would be no need to reduce the book value of capital gains, since the fair value of the groups of cash-generating units with the capital gain allocated would be COP 3,071,013 based on this sensitivity, which is much higher than the book value of COP 1,189,179. Acquisitions through Corficolombiana Below are the main assumptions used in the impairment testing of the most significant capital gains:

• Episol – Panamericana On June 24, 2011, one hundred percent (100%) of the shares in Concesionaria Panamericana S.A. was purchased by Intrex Investment Inc., a subsidiary of Corficolombiana S.A., on which date the respective capital gain was recognized. After that, on December 31, 2012, Intrex Investment Inc merged with Estudios y Proyectos del Sol S.A.S

(Continued)

100



For the valuation of the capital gain assigned to the groups of cash-generating units of Episol-Panamericana in the respective impairment tests, the following projection premises used in the impairment report were taken into account:

• Long-term traffic growth of 3%.

• The valuation of the Company is carried out by free cash flow discount, at a rate of 14.68%, which is

calculated based on the WACC method with a capital structure of 68% - 32%.

• The risk-free rate is the average treasury rate for a period of nine years to be able to reflect the effects of the economic cycle.

• The country risk premium is taken from Damodaran publications.

This valuation resulted in a recoverable amount of COP 233,789 over the book value of COP 119,915. Therefore, it was concluded that there were no impairment indicators that would cause a negative effect on the value of capital gain.

• Promigas:

The attributable cost of recognized capital gain related to the acquisition of Promigas amounted to COP 40,869.

The method used to test impairment corresponds to the discount of projected dividends with a terminal value determined using an assumed P/E multiple (cash trapped in the Company is remunerated at FTD + 1%). Below are the main premises used in the impairment studies of the groups of cash-generating units with capital gains assigned: • Current transport revenue as established in CREG Resolutions 068 / 2013, 082 / 2014, 117 / 2011 and

122 / 2012, which state the rates including the start of the Regulatory Useful Life procedure for certain segments of the Promigas pipelines, the approval of the Loop del Sur project and the rates estimated initially by the CREG based on the method established in CREG Resolution 126 / 2010.

• Volumes transported and capacities procured in accordance with the Company's current estimates, as well as rate pairs (fixed - variable rate) applicable to each contract.

• Estimate of rate re-calculation as of 2017 reducing the regulatory WACC (for volume as well as

capacity) by approximately 2.5% and with a reduction in the rate component that remunerates investment of approximately 15% in real terms. Constant AOM rates in real terms.

• Transport revenue in US Dollars (component that remunerates investment in the rate) recognized at the

average rate of forwards contracted for 2015, and thereafter in accordance with a parity exchange rate starting at the current exchange rate levels.

• Operational costs and expenses growing at levels between CPI and CPI + 1 (for labor and similar expenses).

(Continued)

101



• Distribution of 100% of the dividends in accordance with the policy historically established for the

Company.

• Maintenance of an optimum leverage level of 3.5x debt / EBITDA. The methods and assumptions used for the valuation of the different cash-generating units that have capital gains assigned were reviewed properly by Management. Based on this review, it concluded that at June 30, 2015 and December 31, 2014 it was not necessary to record any impairment of capital gain. This valuation resulted in a recoverable amount of COP 2,991,679 above the book value of COP 2,311,251; therefore, it was concluded that there were no impairment indicators that would cause a negative effect on the value of capital gain.

• Leasing Bogotá S.A Panamá:

The subsidiary Leasing Bogotá S.A Panamá includes in its consolidated financial statements the capital gains generated by the acquisitions of BAC Credomatic Inc, (BAC Credomatic), Banco BBVA Panamá S.A, Banco Reformador S.A and Transcom Bank Ltda as described below:

BAC Credomatic

Capital gain was generated by the acquisition of one hundred percent (100.00%) of the shares of BAC Credomatic, Inc., holding of the Central American financial group BAC Credomatic. Banco de Bogotá was authorized to carry out this transaction by the Colombian Financial Superintendence through its subsidiary, Leasing Bogotá Panamá, according to Communication No. 2010073017-048 / December 3, 2010. E&Y conducted the last valuation update of the groups of cash-generating units to which capital gain was allocated , in its report dated February 9, 2015 based on the financial statements of BAC Credomatic at November 30, 2014, in which it indicates that there are no situations indicating possible impairment, since the value in use of COP 7,596,060 exceeds the book value of COP 6,280,207 of the groups of cash-generating units that have the capital gain allocated. The macroeconomic and business conditions used to analyze the impairment of the entity's capital gains at December 2014 have not changed substantially regarding the events up to June 2015 to indicate a potential impairment of the capital gains. The table below shows the averages of the main premises used in the reports on the impairment of the cash-generating units that have capital gains assigned, taken as the basis for impairment testing on the dates listed:

June 30, 2015 2015 2016 2017 2018 2019

Assets interest rate on loan portfolio and investments 15.3% 15.3% 15.4% 15.5% 15.7% Liability interest rate 3.4% 3.5% 3.6% 3.7% 3.8% Growth of income from commissions 8.3% 17.0% 13.8% 12.9% 12.4% Growth of expenses 9.6% 8.7% 8.8% 8.6% 8.5% Discount rate after taxes 12.9% Growth rate after five years 3.0%

(Continued)

102



December 31, 2014 2015 2016 2017 2018 2019

Assets interest rate on loan portfolio and investments 15.3% 15.3% 15.4% 15.5% 15.7% Liability interest rate 3.4% 3.5% 3.6% 3.7% 3.8% Growth of income from commissions 8.3% 17.0% 13.8% 12.9% 12.4% Growth of expenses 9.6% 8.7% 8.8% 8.6% 8.5% Discount rate after taxes 12.9% Growth rate after five years 3.0%

January 01, 2014 2014 2015 2016 2017 2018

Assets interest rate on loan portfolio and investments 14.8% 14.8% 14.9% 14.9% 15.0% Liability interest rate 3.3% 3.5% 3.5% 3.6% 3.7% Growth of income from commissions 8.3% 11.1% 10.6% 9.4% 8.6% Growth of expenses 10.2% 10.2% 9.4% 8.7% 7.7% Average discount rate after taxes 12.2% Average growth rate after five years 3.2%

To test the impairment of capital gain, a 10-year projection was made, considering that once this period has elapsed, the business will have matured, stabilizing the flow of funds. In turn, macroeconomic assumptions as well as those corresponding to the business of BAC Credomatic were used for the projection, for each of the countries where the Company is operating in order to reflect the reality that each market provides to the CGUs as a whole. The main premises average used is listed in the tables above, including the variables for all the countries where BAC Credomatic operates, determined as follows: • The active interest rates of loans and investments were projected based on historical data as well as on

the expectations of management in the countries where BAC Credomatic is operating, considering the competitiveness of the different services on their markets and the growth strategies for each segment. In addition, the projection of the US Federal Reserve rates were taken into account, which are the basis of international bank rates.

• In turn, for the commission growth projection, the growth of the commercial loans portfolio, as well as

the most competitive markets over the projected timeline were considered. Therefore, BAC Credomatic is expected to reduce this revenue gradually in order to improve its competitiveness on the market and the cost of the services in all the countries where it operates, except for Mexico. To this end, the operation consists only of credit cards and the account exclusively includes the revenue from this loan portfolio. Therefore, its projection considers a growth based on a higher turnover associated with the credit card portfolio.

• The projection of operating expenses took into account various strategies focused on automating

processes to maintain them under control as revenue increased and, therefore, the efficiency ratio tends to improve over the projected time.

• Although the reporting currency of business is the currency of each of the countries corresponding to

BAC subsidiaries in the region, the future flows of funds have been translated to nominal US Dollars in each projected period, discounted at a nominal rate in US Dollars, net of income taxes, estimated as "Ke". A discount rate in US Dollars is used because, since these data are not available, the consistent discount rate in the local currencies cannot be estimated.

(Continued)

103



• The discount rate has been estimated considering the risk profile of each of the markets in which the

BAC operates. • In order to estimate the Terminal Value, the standardized flow of funds was projected indefinitely and

adjusted in accordance with the growth expectations thereof. This projection does not exceed the average growth rate in the long term for the economy in the countries where the Company is operating. Therefore, an annual growth rate of 3% has been estimated in the long term.

The discount rate after taxes used to discount dividend flows reflects the specific risks relative to each of the cash-generating units, and as mentioned earlier, to the markets where BAC Credomatic is operating. If the estimated average discount rate of 12.9% had been 1% higher than the estimated rate (i.e. 13.9%), there would be no need to reduce the book value of capital gains, because the value in use of the groups of cash-generating units that have capital gains assigned would be COP 6,284,992 higher than the book value of COP 6,280,207.

• BBVA Panamá (now BAC de Panamá)

Capital gain was generated by the acquisition of ninety eight point ninety two percent (98.92%) of the shares of Banco Bilbao Vizcaya Argentaria Panamá S.A. (BBVA Panamá, now BAC de Panamá). Banco de Bogotá was authorized to carry out this transaction by the Colombian Financial Superintendence through its subsidiary, Leasing Bogotá Panamá, according to Communication No. 2013072962-052 / December 12, 2013.

The last valuation update of the line of business assigned to the capital gain was conducted by E&Y, in its report dated February 9, 2015 based on the financial statements of Banco BAC de Panamá (previously BBVA Panamá) at November 30, 2014, in which it indicates that there are no impairment indicators or shortcomings that could have a negative impact on the value of capital gains, since the fair value of COP 1,349,347 exceeds the book value of COP 1,306,283 of capital gain.

The macroeconomic and business conditions used to analyze the entity's capital gain impairment for the period of December 2014 have not changed substantially regarding the events up to June 2015 that would lead the Bank to estimate an impairment of the value of capital gains or changes in the projected Flow of Funds, therefore, the values estimated in December 2014 have remained the same. The table below shows the projection details used only in the impairment report of December 2014 following the acquisition in December 2013, taken as the basis for impairment testing on the dates listed:

June 30, 2015 2015 2016 2017 2018 2019

Assets interest rate on loan portfolio and investments 5.8% 5.9% 6.1% 6.1% 6.1% Liability interest rate 2.1% 2.1% 2.1% 2.2% 2.2% Growth of income from commissions 0.8% 12.6% 10.9% 9.4% 8.2% Growth of expenses (1.0%) 11.7% 11.0% 5.9% 4.1% Inflation 3.4% 3.5% 3.0% 2.8% 2.5% Discount rate after taxes 11.5% Growth rate after five years 6.2%

(Continued)

104



December 31, 2014 2015 2016 2017 2018 2019

Assets interest rate on loan portfolio and investments 5.8% 5.9% 6.1% 6.1% 6.1% Liability interest rate 2.1% 2.1% 2.1% 2.2% 2.2% Growth of income from commissions 0.8% 12.6% 10.9% 9.4% 8.2% Growth of expenses (1.0%) 11.7% 11.0% 5.9% 4.1% Inflation 3.4% 3.5% 3.0% 2.8% 2.5% Discount rate after taxes 11.5% Growth rate after five years 6.2%

To estimate capital gains, a 5-year projection was made using both macroeconomic assumptions as well as those related to the business of BBVA Panamá listed in the above tables, determined as follows: • The active interest rates of loans and investments were projected based on the Bank's past

performance and the projection of the US Federal Reserve Rates, which are the basis of international bank rates.

• The passive interest rates were projected considering past performance and the long-term deposit objectives of BBVA Panamá.

• In turn, estimated growths for commissions and expenses are the result of the growth of the loan portfolio and estimated investment transactions.

• The inflation used in the projections was taken from several sources, such as the International Monetary Fund, among others.

• Finally, the growth rate used for the Terminal Value was 6.2%, which is below the annual loan portfolio growth between 13% and 8% in the projection.

The discount rate after taxes used to discount dividend flows reflects the specific risks relative to each cash generating unit. If the estimated discount rate of 11.5% had been 1.0% higher than the rate estimated in the impairment study, the book value of capital gain would have to be reduced by COP 143,418.

• Banco Reformador and Transcom Bank

Capital gain was generated by the acquisition of one hundred percent (100.00%) of the shares of Banco Reformador de Guatemala and Transcom Bank Limited Barbados, declared as Grupo Financiero Reformador de Guatemala. Banco de Bogotá was authorized to carry out these transactions by the Colombian Financial Superintendence through its subsidiaries, Credomatic International Corporation and BAC Credomatic Inc, according to Communication No. 2013068082-062 / December 03, 2013. The last valuation update of the line of business assigned to the capital gain was conducted by E&Y, in its report dated February 9, 2015 based on the financial statements of Banco Reformador y Transcom Bank at November 30, 2014, in which it indicates that there are no impairment indicators given that fair value exceeds book value. In the case of Banco Reformador, the result of the valuation on the impairment test was a fair value of COP 903,632 compared to the unit book value of COP 842,146. In turn, Transcon Bank's fair value is COP 222,499, compared to the book value of COP 210,536.

(Continued)

105



The macroeconomic and business conditions used for the analysis of the entity's capital gains impairment for the period ended in December 2014 did not change substantially regarding the events up to June 2015 leading the Bank to estimate a change in the flows of funds projected, which in turn would produce an impairment of the capital gains. For that reason, the same levels estimated in December 2014 were used.

• Bancor: The table below shows the projection details used in the impairment report of December 2014 following the acquisition in December 2013, taken as the basis for impairment testing on the dates listed:

June 30, 2015 2015 2016 2017 2018 2019

Assets interest rate on loan portfolio and investments 8.4% 8.1% 8.4% 8.7% 8.8% Liability interest rate 3.6% 3.5% 3.4% 3.4% 3.4% Growth of income from commissions 30.2% 23.1% 21.5% 16.7% 13.3% Growth of expenses 0.5% 12.5% 12.8% 10.3% 9.1% Inflation 4.0% 4.0% 4.0% 4.0% 4.0% Discount rate after taxes 12.3% Growth rate after five years 5.9%

December 31, 2014 2015 2016 2017 2018 2019


To estimate capital gains, a 5-year projection was made using both macroeconomic assumptions as well as those related to Bancor's business listed in the above tables, determined as follows:

• Active interest rates on Loans and Investments were projected based on the past performance of the operation and the projection of the US Federal Reserve rates.

• Passive interest rates were projected considering the latest performance of the Bank's operation. • In turn, estimated growths for commissions and expenses are interrelated with the projected growth of the

loan portfolio. • The inflation used in the projections was taken from several sources, such as the International Monetary

Fund. • Finally, the growth rate used for the Terminal Value was 5.9%, which is below the loan portfolio growth

between 11% and 6.7% in the projection.

The discount rate after taxes used to discount dividend flows reflects the specific risks relative to each cash generating unit. If the estimated discount rate of 12.3% had been 1.0% higher than the rate estimated by the Group's management, the book value of capital gain would have to be reduced by COP 67,465.

(Continued)

106



• Transcom Bank

The table below shows the projection details used in the impairment report of December 2014 following the acquisition in December 2013, taken as the basis for impairment testing on the dates listed:

June 30, 2015 2015 2016 2017 2018 2019


December 31, 2014 2015 2016 2017 2018 2019


To estimate capital gains, a 5-year projection was made using both macroeconomic assumptions as well as those related to Transcom Bank's business listed in the above tables, determined as follows: • The active interest rates of Loans and Investments were projected based on the Bank's past

performance as well as the expectations of the Guatemalan market and the projection of the US Federal Reserve Rates, which are used as a reference for international bank rates.

• Passive interest rates were projected considering the latest performance of the Bank's operation, in addition to client deposit long-term goals.

• In turn, estimated growths for Commissions and Expenses are connected to the projected growth of the loan portfolio.

• The inflation rate used in the projections was taken from various domestic and international sources such as the International Monetary Fund and the Bank of Guatemala, for instance.

• Finally, the growth rate used for the Terminal Value was 5.9%, which is below the loan portfolio growth (between 39% and 8%).

The discount rate after taxes used to discount dividend flows reflects the specific risks relative to each cash generating unit. If the estimated discount rate of 13.0% had been 1.0% higher than the rate estimated by the Group's management, the book value of capital gain would have to be reduced by COP 1,002.

(Continued)

107



• Concessions The balance of intangibles of rights in concession agreements and concessioned financial assets at June 30, 2015, December 31 and January 1, 2015, is as follows:

Promigas S.A.

Estudios y proyectos e

inversiones de los andes S.A.

Proyectos de infraestructura S.A.

- PISA

Estudios y proyectos del sol S.A.S - EPISOL Total

Cost COP At January 1, 2014

1,225,830

205,861

255,094

72,391

1,759,176

Additions

37,270

37,296

1,381

0

75,947 At June 30, 2014

1,263,100

243,157

256,475

72,391

1,835,123

Additions

126,560

48,052

2,907

0

177,519 Balance at December 31, 2014

1,389,660

291,209

259,382

72,391

2,012,642

Additions

82,388

39,205

2,322

0

123,915 Balance at June 30, 2015 COP 1,472,048

330,414

261,704

72,391

2,136,557

Accumulated amortization At January 1, 2014 COP 0

0

0

0

0

Amortization of the period

(30,830)

(45,648)

(4,377)

(771)

(81,626) At June 30, 2014

(30,830)

(45,648)

(4,377)

(771)

(81,626)


(21,905)

(47,995)

(4,680)

(786)

(75,366) Balance at December 31, 2014

(52,735)

(93,643)

(9,057)

(1,557)

(156,992)


(30,550)

(45,074)

(4,826)

(759)

(81,209) Balance at June 30, 2015 COP (83,285)

(138,717)

(13,883)

(2,316)

(238,201)

Net Balances Net balance at January 01, 2014 COP 1,225,830

205,861

255,094

72,391

1,759,176

Cost

1,263,100

243,157

256,475

72,391

1,835,123 Accumulated amortization

(30,830)

(45,648)

(4,377)

(771)

(81,626)

Net balance at June 30, 2014

1,232,270

197,509

252,098

71,620

1,753,497

Cost

1,389,660

291,209

259,382

72,391


(52,735)

(93,643)

(9,056)

(1,557)

(156,991)

Net balance at December 31, 2014

1,336,925

197,566

250,326

70,834

1,855,651

Cost

1,472,048

330,414

261,704

72,391


(83.285)

(138,717)

(13,883)

(2,316)

(238,201)

Net balance at June 30, 2015 COP 1,388,763

191,697

247,821

70,075

1,898,356 The table below shows additional information for concession agreements in the construction stage:

Promigas S.A.

Estudios y proyectos e inversiones de los

andes S.A.

Proyectos de infraestructura S.A. -

PISA


June 30, 2015 Accumulated cost incurred in the

concession recorded in the income statement

COP 26,289 192,532 0 0 218,821

Earnings recognized in the concession recorded in the income statement 0 0 0 14,608 14,608

Withholding on payments

0 0 49,367 0 49,367 Accounts receivable from the ANI

0 110,201 0 22,397 132,598

Recognized intangibles for rights in concession agreements 150,918 191,697 12,388 0 355,003

December 31, 2014

Accumulated cost incurred in the concession recorded in the income statement

COP 71,835 219,083 0 0 290,918


Withholding on payments

0 0 49,367 0 49,367 Accounts receivable from the ANI

0 111,686 0 7,651 119,337

Recognized intangibles for rights in concession agreements 117,249 197,566 4,638 0 319,453

(Continued)

108



Promigas S.A.


andes S.A.

Proyectos de infraestructura S.A. -

PISA


June 30, 2014

Accumulated cost incurred in the concession recorded in the income statement

COP 19,974 175,070 0 0 195,044


Accounts receivable from the ANI

0 145,487 0 17,964 163,451 Recognized intangibles for rights in concession agreements 55,929 197,509 42,768 0 296,206

January 01, 2014 Accounts receivable from the ANI

0 169,885 0 14,342 184,227

Recognized intangibles for rights in concession agreements COP 47,812 205,861 19,887 0 273,560

The table below shows additional information on the income and costs incurred in the construction stage of concession agreements:

Promigas S.A.


andes S.A.


Accumulated earnings capitalized as intangible assets or financial assets recorded in the Income Statement

Balance at January 1, 2014

0

0

0

0 Accruals of the concession agreement earning period

19,974

175,070

2,581

197,625

Accrual of return on capital

0

23,365

1,041

24,406 Balance at June 30, 2014

19,974

198,435

3,622

222,031

Accruals of the concession agreement earning period

71,835

219,083

7,804

298,722 Accrual of return on capital

0

10,646

633

11,279

Balance at December 31, 2014

71,835

229,729

8,437

310,001


71,835

229,729

8,437

310,001 Accruals of the concession agreement earning period

26,289

192,532

18,699

237,520

Accrual of return on capital

0

35,989

603

36,592 Balance at June 30, 2015

26,289

228,521

19,302

274,112

Accumulated cost incurred in the concession recorded in the Income Statement

Promigas S.A.

Estudios y proyectos e inversiones de los andes

S.A. Estudios y proyectos del

sol S.A.S - EPISOL Total


0 0 0 0 Construction costs incurred in the project during the period

19,974 175,070 2,395 197,439

Financial costs incurred during the period

0 0 4,031 4,031 Balance at June 30, 2014

19,974 175,070 6,426 201,470

Construction costs incurred during the period

71,835 219,083 8,281 299,199


0 0 4,030 4,030 Balance at December 31, 2015

71,835 219,083 12,311 303,229

Construction costs incurred during the period

26,289 192,532 14,608 233,429


0 0 4,082 4,082 Balance at June 30, 2015

26,289 192,532 18,690 237,511

(Continued)

109



Promigas S.A and Subsidiaries Promigas and its transporter parent companies with concessioned and non-concessioned infrastructure, now transports 50% of the natural gas used in the country by clients in the thermal, industrial, commercial and residential sectors, among others. The country's transport infrastructure consists of approximately 7000 km of gas pipelines, 2896 of which belong to Promigas together with the transporters of its portfolio; 2371 km are under the concession of Promigas with a transport capacity of 595 MCFD. With these concessions, Promigas is contractually committed in construction and operation to comply with international standards and, therefore, its natural gas infrastructure is built based on engineering that meets the operating conditions required, in compliance with the stipulated designs and specifications to ensure the quality expected by all its clients. Its designs and constructions are focused on high integrity indexes, so operation and maintenance are safe and reliable. All the phases that involve the provision of gas transport and distribution services by Promigas and subsidiaries, including construction and improvement of infrastructure, as well as the maintenance and operation thereof, are remunerated with the fees established by the Government through the CREG based on the rate bases. The concession agreements between Promigas and the Government, by which the latter grants Promigas the right to build, operate, maintain, exploit and manage a public service gas pipeline to transport Hydrocarbons, are part of the scope of the IFRIC 12 - Concession Agreements, thus recognizing an intangible asset for the right to charge users for the construction services based on the rate and a financial asset related to the obligation to sell at a fair price at the end of the Concession and any extensions thereof. Proyectos de Infraestructura S.A. Pisa has a concession agreement in the department of Valle del Cauca through Resolution No. 0832 / December 30, 1993. It awarded Proyectos de Infraestructura S.A. Concession Agreement No. 01 / 1993 for an initial term of fifteen (15) years, extended to 20 years by Minutes No. 14 / December 20, 1995, for the construction and maintenance of a new carriageway, improvement and maintenance of the existing carriageway from Buga to Tuluá to La Paila, in the sector between abscissas K67 + 100 and K128 + 100. The companies subordinated by Pisa include Concesiones CCFC S.A. The Company is currently executing Concession Agreement No. 937 / 1995 signed with the Instituto Nacional de Vías (INVIAS, for the Spanish original) on June 30, 1995, whose objective is, by means of the concession system, to carry out the studies and final designs, rehabilitation and construction works, operation and maintenance of the Bogotá (Fontibón) - Facatativá - Los Alpes roadway, Segment 8 of Route 50, in the Department of Cundinamarca, which will expire in March 2024. Concesionaria Vial de los Andes S.A. Coviandes S.A.

Coviandes S.A. has recognized a Financial Asset, initially measured at fair value of the construction services, which represents the present value of the minimum annual payments guaranteed to be received from the grantor, on which there is a contractual right, discounted at a rate of 9.18% EAR. Also, an Intangible Asset has been recognized, representing the difference between the fair value of the construction services and the fair value of the financial asset.

(Continued)

110



The objective of the concession system is to conduct the studies, final designs, rehabilitation and construction works, operation and maintenance of the Bogotá Sector - Puente Real roadway and the maintenance and operation of the Puente Real to Villavicencio Sector. Concesionaria Panamericana S.A.S To fulfill its purpose, Concession Agreement OJ 121-97 was signed on December 16, 1997 between the Cundinamarca Governor's Office and Concesionaria Panamaricana S.A.S. The subject of the agreement is: "The Concession Company agrees to execute, by the Concession system, pursuant to the provisions of Article 32 (4) of Law 80 / 1993 and Law 105 / 1994, the work offered in the successful bid of Public Tender SV-01-97, in accordance with the respective Specifications and this Agreement, the studies, final designs, rehabilitation and construction work, maintenance and operation of the Corredor Vial del Centro Occidente de Cundinamarca [Road Corridor of Central Western Cundinamarca] project, made up of the Los Alpes - Villeta and Chuguacal - Cambao segments, including the access roads to the municipalities of Guayabal de Síquima, Bituima, Vianí and San Juan de Rioseco.” The Concession Agreement is supervised and controlled by the Auditor procured by the Cundinamarca Governor's Office through the Cundinamarca Concessions Institute (ICCU, for the Spanish original). At December 31, 2014, 28 agreements have been signed in addition to Concession Agreement OJ-121-97. Additional agreements No. 7 and 28 are currently active. All other additional agreements are pending formalization of the minutes on the final payment of the work. At June 30, 2015 and December 31, 2014, the Corporation and subsidiaries had no contingent assets on account of pending income originated by contractual difference with a concession, other than the payment of tariffs. There were no contingent liabilities either on account of fines or sanctions imposed by the Government during the course of the concession agreements due to contractual non-compliance.

• Other intangible assets The table below shows the activity of the cost of intangible assets other than capital gains and concessions:

Balance at June

30, 2015 Acquisition/

Additions Disposals Exchange difference Transfers

(Increase/Decrease) Balance at December 31, 2014

Intellectual property rights and patents COP 16,286 1,134 0 0 0 15,152

Other rights 4,395 206 (206) 0 0 4,395 Licenses 63,183 5,254 (412) 0 1,089 57,252 Computer programs and applications 356,959 68,497 (1,858) 14,034 (8,902) 285,188

Intangible assets related to clients 27,393 0 0 1,288 0 26,105

Other intangible assets 18,045 890 0 (8) 7,813 9,350 COP 486,261 75,981 (2,476) 15,314 0 397,442

(Continued)

111




Acquisition/Additions Disposal

s

Exchange

difference

Transfers (Increase/Decreas

e)

Balance at June 30,

2014

Intellectual property rights, patents and other industrial property, service and operating rights

COP 15,152 3,536 0 0 0 11,616

Other rights 4,395 4,326 (1,105) 0 0 1,174 Licenses 57,252 10,621 (321) 0 0 46,952 Computer programs and applications (1) 285,188 62,179 (12,598) 34,813 (2,410) 203,204

Intangible assets related to clients 26,105 0 0 5,838 0 20,267

Other intangible assets 9,350 9,342 0 268 2,410 (2,670)

COP 397,442 90,004 (14,024) 40,919 0 280,543

(1) At December 31, 2014, there were COP 804 corresponding to other assets. Below is the activity of the amortization of intangible assets other than capital gains:

Balance at June 30,

2015 Amortization

(1) Disposals Exchange difference

Transfers (Increase/Decrease)


Intellectual property rights and patents COP 759 453 0 0 (143) 449

Other rights 43 205 (206) 0 3 41 Licenses 3,165 9,632 (139) 0 (10,562) 4,234 Computer programs and applications 128,479 17,804 (613) 10,444 (2,378) 103,222

Intangible assets related to clients 12,666 6,567 0 765 0 5,334

Other intangible assets 848 391 0 0 175 282 COP 145,960 35,052 (958) 11,209 (12,905) 113,562

Balance at December 31, 2014 Amortization Disposals

Exchange difference

Balance at June 30,

2014

Intellectual property rights, patents and other industrial property, service and operating rights COP 449 292 0 0 157

Other rights 41 160 (1,105) 0 986 Licenses 4,234 3,514 (39) 0 759 Computer programs and applications 103,222 23,711 (11,994) 20,479 71,026 Intangible assets related to clients 5,334 2,437 0 948 1,949 Other intangible assets COP 282 221 0 0 61 113,562 30,335 (13,138) 21,427 74,938

(1) At June 30, 2015, the amortization charged to the expense of intangibles corresponding to the Parent Company was comprised of COP

2,579 and COP 679, which are recorded in amortization of intangible assets (computer programs and applications) and in miscellaneous, respectively.

At June 30, 2015, December 31 and January 1, 2014, the impairment of intangible assets other than capital gains was COP 12, respectively.

(Continued)

112



21. Income tax

a) Income Tax Allowance

i. Components of Income Tax Expense:

Income tax expense for the semesters that ended June 30, 2015 and December 31, 2014 break down as follows:

Semesters ended on

June 30,

2015 December

31, 2014 Current Tax COP 680,377 462,228 Adjustments for previous periods 2,545 (24,273) Allowance for uncertain tax positions (1,936) 4,073 Deferred income taxes (34) 176,824 Total income tax COP 680,952 618,852

Pursuant to Article 165 of Law 1607 / 2012 and Regulatory Decree 2548 / 2014, for tax purposes, the remissions contained in the tax regulation for accounting regulations will continue in effect during the four (4) years following the effective date of the International Financial Reporting Standards. Consequently, from 2015 to 2018 the tax bases of the entries that are not included in the tax declarations shall continue unchanged, and the determination of the liability for current income tax and the Income Tax for Equality (CREE) shall be made on the basis of the tax regulations in effect, which in some cases are referred to the previous GAAP up to December 31, 2014 (Decree 2649 / 1993 and other complementary provisions). In accordance to the aforementioned, the determination of the taxable base of the income tax and CREE tax for the semesters ending on June 30, 2015 and December 31, 2014 generated on the basis of the income tax provisions.

ii. Reconciliation of the Nominal Tax Rate and Effective Rate:

The following are the basic parameters in effect for income tax in Colombia: In Colombia • Taxable income is taxed at 25% for tax on income and complimentary earnings. • At January 1, 2013, Law 1607 / December 2012 created the income tax for equality (CREE) as a

contribution made by companies, legal persons and other taxpayers required to file income and complementary tax returns, in order to benefit employees, generate employment and promote social investment. Income tax for equality (CREE) for 2014, 2015 and subsequent years is 9%.

• As of 2015, an additional surcharge of the CREE tax was created in the amount of 5% for 2015, 6% for 2016, 8% for 2017 and 9% for 2018.

• The CREE tax base cannot be less than 3% of the taxpayer’s liquid equity on the last day of the immediately previous fiscal year.

(Continued)

113



In other countries In Guatemala, income tax rates were revised in 2012, and the following rates were established for the System on Earnings from Lucrative Activities: 2013, 31%; 2014, 28% and subsequent years 25%. For the Optional Simplified System on Income from Lucrative Activities: 2013, 6% and following 7%. Other income tax rates established by tax authorities are: Costa Rica, El Salvador, Honduras and Mexico 30%, Panama 25%. The reconciliation of the total Group's income tax expense calculated at currently applicable tax rates and the income tax expense recorded in the statement of income for semesters ended on June 30, 2015 and December 31, 2014, breaks down as follows: Reconciliation of the Effective Income Tax Rate

Semesters ended on

June 30,

2015 December

31, 2014 Earnings before taxes COP 2,084,142 1,691,891 Theoretical income tax 39% for the year 2015, 34% 2014 812,815 575,243 Greater (smaller) taxes that increases (decreases) theoretical income tax: Non-deductible expenses 72.652 121,434 Difference between taxable income and presumptive income, which did not generate deferred income tax assets.

(16,371)

607

Equity or Wealth Tax 937 16,561 Non-taxable dividends received (4,067) 5,058 Non-taxable income calculated using the equity method (31.279) (27,004) Profit (loss) on sale or valuation of non-taxable investment 572 (42) Interest and other non-taxable income (6,192) (23,070) Exempt income (1) (31,415) (41,271) Intangibles not subject to deferred tax (182) (889) Incidental gain with different tax rates (635) 875 Deductions with different rates for the CREE tax 674 240 Tax benefit on the acquisition of performing assets (6,755) (4,276) Earnings of National Subsidiaries (165) (183) Earnings of subsidiaries in tax-free countries (3,538) (1,283) Earnings of subsidiaries in countries with different tax rates (40,957) 4,485 Effect of changes in tax rates on deferred taxes (59,071) (2,716) Permanent Differences (COLGAAP vs. IFRS earnings) (2,044) 4,407 Adjustments for the effect of consolidation 25 29 Adjustments for previous periods (27,788) (24,273) Adjustment for uncertain tax positions of previous periods (1,936) 4,073 Other Items 25,672 10,847 Total income tax expense for the period COP 680,952 618,852

(1) This item represents the revenue obtained by subsidiaries; the most significant one is that of Leasing Bogotá Panamá, which amounts to COP 22,261 at June 2015 and COP 27,007 at December 2014.

iii. Tax losses and excess presumptive income:

At June 30, 2015, December 31, 2014 and January 1, 2014, tax losses and excess presumptive income in the Group's companies that have not been used and regarding which the Group has not recorded deferred income tax assets due to uncertainty in the recovery thereof, are as follows.

(Continued)

114



At June 30, 2015, December 31, 2014 and January 1, 2014, the tax losses that have not been used and on which the Group has not recorded deferred income tax assets are COP 20,712, COP 20,937 and COP 19,498 respectively

June 30,

2015 December 31, 2014

January 01, 2014

Tax losses expiring on: December 31, 2015 COP 1,052 1,037 13

December 31, 2016

1,575 1,542 885 December 31, 2017

165 162 1,321

December 31, 2018

5 6 0 No expiration date

73,923 74,753 68,897

Subtotal

76,720 77,500 71,116 Excess presumptive income expiring on:

December 31, 2015

307 800 1,792

December 31, 2016

1,165 1,832 1,779 December 31, 2017

1,614 1,614 1,569

December 31, 2018

3,461 2,644 1,733 Subtotal

6,547 6,890 6,873

Total COP 83,267 84,390 77,989

The subsidiaries of Corficolombiana have potential deferred income tax assets that have not been recognized at June 30, 2015 on account of other temporary deductions for a total of COP 82,194 (COP 61,292 at December 31, 2014).

iv. Deferred taxes concerning subsidiaries, associates and joint ventures:

In compliance with IAS 12, the Group did not record differed tax liabilities related to temporary differences of investments in subsidiaries: The above is because: i) the Group has control of the subsidiaries and, consequently, can decide on the reversal of such temporary differences; and ii) the Group is not planning to do so in the medium term; therefore, said temporary differences are not likely to be reversed in the foreseeable future. Temporary differences for the concepts indicated at June 30, 2015 and December 31, 2014 amounted to COP 647,278 and COP 270,950, respectively.

v. Deferred income taxes by type of temporary difference:

The differences between the book value of assets and liabilities and their tax bases give rise to the following temporary differences that generate deferred taxes calculated and recorded on the semesters ending at June 30, 2015 and December 31, 2014 based on the currently applicable tax rates for the years when the temporary differences are reversed.


Credited (Charged)

to the Statement of Income

Credited (Charged) to the OCI Reclassifications

Balance at June 30,

2015

Deferred tax assets Reappraisal of fixed income investments COP 3,730 (8,068) 13,578 0 9,240 Reappraisal of equity investments 154 215 0 0 369 Reappraisal of derivatives 462,930 (100,023) (65,527) 0 297,380 Differences between the accounting and tax bases of the loan portfolio 29,644 (23,537) 0 0 6,107

(Continued)

115




Credited (Charged)



Balance at June 30,

2015

Loan Portfolio Allowance 46,700 (25,915) 19,258 0 40,043 Financial assets under concession agreements 1,429 (1,429) 0 0 0 Differences between the accounting and tax bases of foreclosed assets 18,476 5,410 0 0 23,886

Allowance for Foreclosed Assets 6,239 2,642 0 0 8,881 Differences between the accounting and tax bases of the cost of property, plant and equipment 16,154 2,430 0 0 18,584

Differences between the accounting and tax bases of the accrual of property, plant and equipment depreciation 8,420 6,042 0 0 14,462

Biological Assets 4,581 2,206 0 0 6,787 Differences between the accounting and tax bases deferred charges of intangible assets 90,135 14,877 0 0 105,012

Fiscal losses 61,963 (677) 37,535 0 98,821 Excess of presumptive income 7,758 8,913 81,609 0 98,280 Provisions for non-deductible liabilities 75,848 7,772 0 0 83,620 Employee benefits 70,399 (7,525) 482 0 63,356 Goodwill 0 349 0 0 349 Other 137,256 (28,249) 0 0 109,007 Subtotal 1,041,816 (144,567) 86,935 0 984,184

Deferred tax liabilities Reappraisal of fixed income investments 21,400 (24,395) 0 0 (2,995) Reappraisal of equity investments (86,037) 18,789 (6,073) (9,887) (83,208) Reappraisal of derivatives (258,206) 153,511 0 0 (104,695) Differences between the accounting and tax bases of the loan portfolio (18,299) 993 0 0 (17,306)

Loan Portfolio Allowance (188,149) 41,647 (8,396) 0 (154,898) Differences between the accounting and tax bases of foreclosed assets (38,640) (1,352) 0 0 (39,992)

Allowance for Foreclosed Assets (3,358) (932) 0 0 (4,290) Differences between the accounting and tax bases of the cost of property, plant and equipment (267,801) 37,812 0 0 (229,989)

Differences between the accounting and tax bases of the accrual of property, plant and equipment depreciation (95,734) (9,825) 0 0 (105,559)

Differences between the accounting and tax bases deferred charges of intangible assets (141,107) (20,702) 0 0 (161,809)

Earnings not brought on investments in subsidiaries (17,975) (9,258) 0 0 (27,233) Provisions for non-deductible liabilities (24,688) 24,134 0 0 (554) Goodwill (14,319) (7,423) 0 0 (21,742) Other (161,121) 68,830 0 0 (92,291) Translation of Financial Statements 0 0 (211,037) (454,017) (665,054) Financial and intangible assets under concession agreements (370,397) (127,228) 0 0 (497,625)

Subtotal (1,664,431) 144,601 (225,506) (463,904) (2,209,240) Total COP (622,615) 34 (138,571) (463,904) (1,225,056)


Balance at June 30,

2014

Credited (Charged)




Deferred tax assets Reappraisal of fixed income investments COP 5,666 19,675 (15,108) (837) 0 3,730 Reappraisal of equity investments 3,783 6,992 (6,838) 0 0 154 Reappraisal of derivatives 53,893 57,058 111,301 294,263 308 462,930 Differences between the accounting and tax bases of the loan portfolio 24,588 7,592 22,052 0 0 29,644

Loan Portfolio Allowance 114,592 41,806 4,894 0 0 46,700 Financial assets under concession agreements 0 705 724 0 0 1,429

Differences between the accounting and tax bases of foreclosed assets 3,602 0 18,476 0 0 18,476

(Continued)

116




Balance at June 30,

2014

Credited (Charged)




Allowance for Foreclosed Assets 7,091 4,696 1,543 0 0 6,239 Differences between the accounting and tax bases of the cost of property, plant and equipment 25,609 11,755 4,399 0 0 16,154

Differences between the accounting and tax bases of the accrual of property, plant and equipment depreciation 1,216 1,081 7,339 0 0 8,420

Biological Assets 459 147 4,434 0 0 4,581 Differences between the accounting and tax bases deferred charges of intangible assets 101,017 106,658 (16,523) 0 0 90,135

Fiscal losses 57,298 79,748 (17,785) 0 0 61,963 Excess of presumptive income 35,665 9,899 (2,141) 0 0 7,758 Provisions for non-deductible liabilities 21,535 82,652 (6,804) 0 0 75,848 Employee benefits 52,491 57,046 13,840 (487) 0 70,399 Goodwill 7,470 29 (29) 0 0 0 Other 62,979 140,830 (3,663) 0 89 137,256 Subtotal 578,954 628,369 120,111 292,939 397 1,041,816

Deferred tax liabilities Reappraisal of fixed income investments (45,439) (4.566) 25,966 0 0 21,400 Reappraisal of equity investments (66,840) (69,296) (3,507) (3,347) (9,887) (86,037) Reappraisal of derivatives (50) (98,876) (54,924) 0 (104,406) (258,206) Differences between the accounting and tax bases of the loan portfolio (8,614) (13,108) (5,191) 0 0 (18,299)

Loan Portfolio Allowance (111,104) (121,718) (54,426) (12,005) 0 (188,149) Differences between the accounting and tax bases of foreclosed assets (28,061) (23,301) (15,339) 0 0 (38,640)

Allowance for Foreclosed Assets 0 (3,425) 67 0 0 (3,358) Differences between the accounting and tax bases of the cost of property, plant and equipment (291,755) (275,090) 7,289 0 0 (267,801)

Differences between the accounting and tax bases of the accrual of property, plant and equipment depreciation (28,186) (67,347) (28,387) 0 0 (95,734)

Differences between the accounting and tax bases deferred charges of intangible assets (39,448) (45,486) (95,621) 0 0 (141,107)

Earnings not brought on investments in subsidiaries 0 (28,164) 10,189 0 0 (17,975)

Provisions for non-deductible liabilities (55) (1,500) (23,188) 0 0 (24,688) Goodwill (834) (6,075) (8,244) 0 0 (14,319) Other (102,590) (146,246) (15,096) 0 221 (161,121) Financial and intangible assets under concession agreements (503,945) (333,874) (36,523) 0 0 (370,397)

Subtotal (1,226,921) (1,238,072) (296,935) (15,352) (114,072) (1,664,431) Total COP (647,967) (609,703) (176,824) 277,587 (113,675) (622,615)

vi. Effect of current and deferred taxes on each component of other comprehensive earnings in

equity: The effects of current and deferred taxes on each component of other comprehensive earnings are detailed below:

June 30, 2015 December 31, 2014

Amount

before tax Current

Tax Deferred

Tax Net Amount

before tax Current

Tax Deferred

Tax Net

Entries that may be later reclassified to the statement of income for the period Cash Flow Hedging COP 1,315 0 0 1,315 (5,742) 0 0 (5,742) Exchange difference of derivatives in foreign currency (420,244) 121,285 53,617 (245,342) (870,967) 38,039 294,263 (538,665)

(Continued)

117



June 30, 2015 December 31, 2014

Amount

before tax Current

Tax Deferred

Tax Net Amount

before tax Current

Tax Deferred

Tax Net

Exchange difference of bonds in foreign currency (204,776) 79,862 0 (124,914) (462,371) 157,206 0 (305,165)

Exchange rate adjustment in subsidiaries abroad 596,751 0 (196,121) 400,630 1,460,884 (493,789) 0 967,095

Gain (loss) from measurement of financial assets measured at fair value through OCI

(8,934) 0 0 (8,934) 3,377 0 467 3,844

Share in Other Comprehensive Income of Associates (17,082) 0 6,073 (11,009) 14,046 0 0 14,046

Adjustment of the loan portfolio provision for purposes of the consolidated financial statements

(17,591) 0 612 (16,979) 47,453 0 (17,345) 30,108

Subtotals (70,561) 201,147 (135,819) (5,233) 186,680 (298,544) 277,385 165,521 Entries that will not be reclassified in the statement of income for the period

New actuarial measurements in defined benefit plans 8,095 0 (2,752) 5,343 (593) 0 202 (391)

Subtotals 8,095 0 (2,752) 5,343 (593) 0 202 (391) Total other comprehensive income during the period COP (62,466) 201,147 (138,571) 110 186,087 (298,544) 277,587 165,130

vii. Uncertainties in open tax positions

At June 30, 2015 and December 31, 2014, the expense for tax uncertainties amounted to COP 2,338 and COP 4,073 respectively. Sanctions and interest on late payments related to these tax uncertainties are accumulated and recorded in the respective expense. The balance at June 30, 2015 is expected to be used fully or released when the tax authorities' right to inspection with respect to the tax returns expires.

22. Other Assets

The details of other assets are as follows:

June 30,

2015 December 31, 2014

January 01, 2014

Office supplies and stationery in store and on plastic CC - DC 58,239 83,993 68,244 Works of art 15,311 14,583 13,304 Activities in joint operations 5,623 3,206 594 Remodeling 4,746 3,544 1,572 Prepaid expenses 24,144 19,085 18,924 Permanent contributions 15,262 39,318 17,673 Deferred bank commissions 26,630 22,917 0 Other 16,883 22 9,759 COP 166,838 186,668 130,070

(Continued)

118



23. Deposits

• Client Deposits Client deposits received by the Group as part of its operations are broken down below:

June 30,


01, 2014 By classification

At amortized cost COP 82,058,186 73,652,707 63,771,709 By nature

At sight Checking accounts 20,207,680 20,250,112 16,565,889 Savings deposits 25,398,052 21,522,535 22,147,923 Special savings accounts 35,231 32,198 14,143 Fixed term Time deposits 36,245,554 31,505,718 24,689,743 Other 171,669 342,144 354,011

82,058,186 73,652,707 63,771,709 By currency

In Colombian pesos 42,906,873 39,273,627 38,394,596 In US dollars 39,593,314 34,616,808 26,104,784 Eliminations (442,001) (237,728) (727,671)

Total COP 82,058,186 73,652,707 63,771,709 Customer Deposits - Interest Rate

Below is a summary of the effective annual interest rates incurred on customer deposits:

June 30, 2015 December 31, 2014 January 01, 2014 Deposits Deposits Deposits Legal Tender Foreign

Currency Legal Tender Foreign Currency Legal Tender Foreign

Currency Rate Rate Rate Rate Rate Rate Min

% Max. % Min

% Max. %

Min % Max.

% Min % Max.

% Min % Max.

% Min % Max.

% Checking accounts 0.00% 4.96% 0.00% 0.55% 0.00% 4.89% 0.00% 0.25% 0.00% 4.57% 0.00% 0.25% Savings account 0.00% 4.80% 0.00% 0.75% 0.00% 4.50% 0.00% 1.00% 0.00% 4.20% 0.00% 1.25% Other funds payable at sight

0.00% 3.80% 0.00% 0.00% 0.00% 3.80% 0.00% 0.00% 0.00% 3.00% 0.00% 0.00%

Time deposits 1.02% 9.27% 0.00% 4.00% 0.05% 9.18% 0.00% 5.50% 0.91% 9.63% 0.00% 5.50%

• Deposits by Sector

The following provides the details of the concentration of customer deposits received by economic sector:

June 30, 2015 December 31, 2014 January 01, 2014 Value %

Value % Value %

Colombian government or government entities

COP 7,098,429 8.6% 5,968,013 8.1% 6,718,866 10.5%

Colombian municipalities and departments

348,231 0.4% 204,806 0.3% 77,835 0.1%

Foreign Governments 287,245 0.3% 264,245 0.3% 637,506 1.0% Manufacturing 2,045,691 2.5% 2,109,651 2.9% 1,936,299 3.0% Real estate 714,558 0.9% 611,260 0.8% 506,803 0.8% Trade 11,291,629 13.8% 10,653,568 14.5% 8,503,058 13.3% Agriculture and livestock 781,115 1.0% 691,928 0.9% 534,860 0.9% Individuals 25,300,654 30.9% 23,390,687 31.8% 16,924,436 26.6% Others 34,596,630 42.2% 29,996,277 40.7% 28,659,717 44.9% Eliminations (405.996) (0.6%) (237.728) (0.3%) (727.671) (1.1%) Total COP 82,058,186 100.0% 73,652,707 100.0% 63,771,709 100.00%

(Continued)

119



At June 30, 2015 and December 31, 2014, the Group had deposits of COP 40,458,923 and COP 38,161,416 corresponding to 12,862 and 11,585 customers that exceeded COP 250, respectively. At June 30, 2015, there are customer deposits for COP 24,903 as an irrevocable guarantee of the commitments under letters of credit.

24. Borrowings

• Short-term Borrowings

The summary of the Group's short-term borrowings is provided below:

June 30,

2015 December 31, 2014

January 01, 2014

Legal Tender Purchased interbank funds COP 462,861

317,779

206,414 Commitment to sell investments in closed repo transactions 1,972,126

342,474

1,191,400

Commitments to transfer via simultaneous operations 644,025

1,876,745

2,345,696 Commitments to transfer investments via simultaneous operations 3,577,589

0

0

Commitments resulting from positions in short-sell simultaneous operations 0

35,575

12,299 Discounts in checking accounts 881 34,871 46,202 Money market and related transactions 0 72 0 Credit cards with deferred payment 0

0

5,043

Correspondent Banks 1,385

247,375

110,315 Subtotal legal tender 6,658,867

2,854,891

3,917,369

Foreign Currency Purchased interbank funds 116,946

95,698

175,341 Sale commitments of investments via open repo operations 273,270

229,948

210,037

Money market and related transactions 0 2 14 Discounts in checking accounts 86,581 0 0 Credit cards with deferred payment

4,575

3,930

0

Correspondent Banks

99,921

63,875

28,791 Subtotal foreign currency

581,293

393,453

414,183

Total COP 7,240,160 3,248,344 4,331,552

• Short-term Borrowings - Effective Interest Rates

Below is a summary of the effective annual interest rates incurred on short-term borrowings:

June 30, 2015 In Colombian Pesos In Foreign Currency Rate Rate Rate Rate

Minimum % Maximum

% Minimum % Maximum

% Interbank funds and repo and simultaneous operations 4.35% 4.56% 0.00% 0.35%

December 31, 2014 In Colombian Pesos In Foreign Currency Rate Rate Rate Rate

Minimum % Maximum

% Minimum % Maximum


January 01, 2014 In Colombian Pesos In Foreign Currency Rate Rate Rate Rate

Minimum % Maximum

% Minimum % Maximum


(Continued)

120



• Long-term Borrowings

Entity June 30, 2015 December

31, 2014 January 01, 2014

Current Interest Rate

Banco de Comercio Exterior - BANCOLDEX (1) COP 248,469 309,727 191,317 1.05% to 15.23%

Fondo para el Financiamiento del Sector Agropecuario (FINAGRO, for the Spanish original)

164,001 179,986 220,519 0.11% to 12.62%

Financiera de Desarrollo Territorial S.A "FINDETER

582,358 465,768 386,830 0.11% to 8.62% Foreign banks

7,117,157 6,949,626 4,693,875 0.00% to 15%

Others 1,116,767 1,286,097 1,025,935 0.00% to 20.48%

Current portion (2)

6,292,683 6,062,908 5,672,385

COP 15,521,435 15,254,112 12,190,861

(1) Rediscounting transactions: The Colombian Government has created certain programs to develop specific sectors of the economy, including

foreign trade, agriculture, tourism, housing construction and other industries. (2) Maturity time frames for short and long-term borrowings are in the liquidity risk note.

• Outstanding Investment Securities - Bonds

Legal Tender

Issuer Issue Date June 30, 2015

December 31, 2014

January 01, 2014 Maturity Date

Interest Rate

Banco de Bogotá S.A. Subordinated Bonds 2008 4/15/2008 COP 0 230,038 225,336 4/15/2015

ICP + 7% at RVU + 7% at

DTF + 3%

Subordinated Bonds 2010 2/23/2010 225,427 227,575 223,261 2/23/2017 to 2/23/2020

ICP + 5.33% at RVU + 5.29% at CPI + 5.45% at RVU + 5.45%

Total Banco de Bogotá S.A.

225,427 457,613 448,597 Corporación Financiera

Colombiana S.A. Financial institution collateral fund 6/19/2010 1,053 1,053 1,053 11/28/2015

DTF – E.A.

Proyectos de Infraestructura S.A. 5/20/2009 22,600 22,600 22,600 5/20/2016

11.5% Proyectos de Infraestructura S.A. 5/20/2009 57,400 57,400 57,400 5/20/2016

11.9%

Promigas 8/27/2009 80,000 80,000 80,000 8/27/2016

CPI + 4.95% Promigas 8/27/2009 150,000 150,000 150,000 8/27/2019

CPI + 5.40%

Promigas 8/27/2009 170,000 170,000 170,000 8/27/2024

CPI + 5.99% Promigas 1/29/2013 99,821 99,821 99,821 1/29/2020

CPI + 3.05%

Promigas 1/29/2013 150,179 150,179 150,179 1/29/2023

CPI + 3.22% Promigas 1/29/2013 250,000 250,000 278,424 1/29/2033

CPI + 3.64%

Promigas 3/11/2015 105,000 0 0 3/11/2019

CPI + 2.55% Promigas 3/11/2015 120,000 0 0 3/11/2022

CPI + 3.34%

Promigas 3/11/2015 175,000 0 0 3/11/2030

CPI + 4.37% Gases de occidente 7/23/2009 0 0 25,500 7/23/2014

CPI + 4.79%

Gases de occidente 7/23/2009 32,950 30,632 24,294 7/23/2016

CPI + 5.39% Gases de occidente 7/23/2009 100,206 100,206 100,206 7/23/2019

CPI + 5.89%

Gases de occidente 12/11/2012 110,382 110,382 110,382 12/11/2022

CPI + 3.75% Gases de occidente 12/11/2012 89,618 89,618 89,618 12/11/2032

CPI + 4.13%

Surtigas 2/12/2013 130,000 130,000 130,000 2/12/2023

CPI + 3.25% Surtigas 2/12/2013 70,000 70,000 70,000 2/12/2033

CPI + 3.64%

Total Corporación Financiera Colombiana S.A.

1,914,209 1,511,891 1,559,477

Total legal tender

COP 2,139,636 1,969,504 2,008,074

(Continued)

121



Foreign Currency Issuer Issue Date

June 30, 2015

December 31, 2014


Interest Rate

Banco de Bogotá S.A. Ordinary bonds abroad (due 2017) 12/19/2011 COP 1,584,898 1,454,322 1,169,589 1/15/2017

5.00% 6 SA

Subordinated bonds abroad (due 2023) 2/19/2013 1,319,061 1,214,421 971,930 2/19/2023

5,375% 6 SA

Total Banco de Bogotá S.A.

2,903,959

2,668,743

2,141,519 BAC Credomatic El Salvador 2/16/2009

0

0

28,902

2/16/2014

6.00%

12/16/2011 10,395 9,570 7,707 12/16/2011

4.25%

2/6/2012 5,197 4,785 3,854 2/6/2017

4.25%

3/27/2012 10,265 9,450 7,707 3/27/2017

4.25%

5/2/2012 to 5/24/2012 15,194 13,989 11,266

5/2/2017 to 5/24/2017

4.25%

12/17/2012 0 0 19,268 12/17/2014

5.00%

1/28/2013 0 11,962 9,634 1/28/2015

5.00%

2/11/2013 to 2/27/2013 77,960 71,774 57,805

2/11/2020 to 2/27/2020

5.50%

12/3/2013 0 0 14,720 1/31/2014

4.25%

5/30/2014 51,974 47,849 0 5/30/2019

6.00% El Salvador 6/26/2014 25,987 23,925 0 6/26/2019

6.00%

7/31/2014 51,974 47,849 0 7/31/2019

6.00%

10/22/2014 to 10/31/2014 51,974 47,849 0

10/22/2019 to 10/31/2019

6.00%

12/19/2014 to 12/31/2014 25,987 39,269 0 12/19/2016

5.00%

2/2/2015 26 0 0 2/2/2017

5.50%

4/16/2015 25,987 0 0 4/16/2017

5.00%

6/9/2015 16,732 0 0 7/31/2015

4.50%

369,652 328,271 160,863 Guatemala 10/15/2012 0 0 1,106 4/11/2014

8.25%

1/3/2013 to 1/31/2013 0 0 24,268

1/3/2014 to 7/31/2014

6.00% to 8.50%

2/1/2013 to 2/28/2013 0 0 19,000

2/3/2014 to 2/28/2014

6.00% to 8.50%

3/1/2013 to 3/25/2013 0 0 13,163

3/3/2014 to 3/25/2014

6.00% to 8.50%

4/1/2013 to 4/30/2013 0 0 16,408

4/1/2014 to 5/26/2014

6.00% to 8.50%

5/2/2013 to 5/31/2013 0 0 24,489

2/25/2014 to 6/27/2014

6.00% to 8.25%

6/3/2013 to 6/27/2013 0 0 25,830

4/21/2014 to 12/23/2014

6.00% to 8.25%

7/3/2013 to 7/31/2013 0 1,970 26,735

1/6/2014 to 1/19/2015

4.75% to 8.25%

8/2/2013 to 8/30/2013 0 0 24,700

1/29/2014 to 9/1/2014

4.75% to 8.25%

9/2/2013 to 9/30/2013 0 0 13,595

2/29/2014 to 10/9/2014

4.75% to 8.25%

10/2/2013 to 10/31/2013 0 5,354 19,233

4/9/2014 to 6/17/2015

4.75% to 8.25%

11/4/2013 to 11/29/2013 0 0 16,897

2/25/2014 to 12/1/2014

4.75% to 8.25%

12/3/2013 to 12/27/2013 0 0 13,183

6/4/2014 to 12/26/2014

6.00% to 8.25%

1/2/2014 to 1/31/2014 0 27,484 0

1/5/2015 to 2/2/2015

6.00% to 8.25%

2/3/2014 to 2/28/2014 0 34,717 0

1/19/2015 to 3/2/2015

6.00% to 8.25%

3/3/2014 to 3/27/2014 0 16,874 0

3/3/2015 to 3/27/2015

6.00% to 8.25%

4/1/2014 to 4/30/2014 0 26,027 0

4/6/2015 to 6/3/2015

6.00% to 8.25%

5/2/2014 to 5/30/2014 0 31,665 0

3/23/2015 to 6/13/2015

6.00% to 8.25%

6/27/2014 103 26,751 0 7/2/2015

6.75% to 7.00%

7/3/2014 to 7/31/2014 34,578 34,184 0

7/3/2015 to 7/31/2015

6.00% to 8.25%

8/1/2014 to 8/29/2014 42,599 39,433 0

7/10/2015 to 9/7/2015

6.00% to 8.50%

(Continued)

122




June 30, 2015

December 31, 2014


Interest Rate

Guatemala

9/1/2014 to 9/30/2014 16,193 15,674 0

8/31/2015 to 9/30/2015

6.00% to 8.25%

10/2/2014 to 10/31/2014 32,100 30,228 0

10/2/2015 to 11/3/2015

6.00% to 8.25%

11/4/2014 to 11/28/2014 24,267 22,661 0

11/4/2015 to 11/30/2015

6.00% to 8.50%

12/1/2014 to 12/26/2014 23,871 23,818 0

7/10/2015 to 6/20/2016

6.00% to 8.25%

1/5/2015 to 1/30/2015 32,690 0 0

7/6/2015 to 7/21/2016

4.75% to 8.50%

2/2/2015 to 2/27/2015 36,463 0 0

8/3/2015 to 6/17/2016

5.00% to 8.50%

3/2/2015 to 3/27/2015 33,648 0 0

9/9/2015 to 4/8/2016

6.00% to 8.25%

4/6/2015 to 4/30/2015 37,342 0 0

10/6/2015 to 5/9/2016

4.75% to 8.50%

5/4/2015 to 5/29/2015 40,202 0 0

11/13/2015 to 6/6/2016

5.00% to 8.50%

6/1/2015 to 6/26/2015 41,619 0 0

9/9/2015 to 6/13/2018

5.00% to 8.50%

395,675 336,840 238,607

Honduras 12/21/2012 to 12/26/2012 14,177 13,290 11,179 12/21/2015

14.00%

1/7/2013 to 1/31/2013 3,646 3,473 2,923 12/21/2015

14.00%

2/13/2013 18 17 14 12/21/2015

14.00%

3/7/2013 to 3/13/2013 3,293 3,087 2,597 12/21/2015

14.00%

4/3/2013 to 4/26/2013 9,495 8,901 7,485 12/21/2015

14.00%

5/9/2013 to 5/31/2013 27,396 25,270 20,400

12/21/2015 to 5/30/2016

6.00% to 14.00%

6/3/2013 to 6/27/2013 9,887 9,151 9,398

12/21/2015 to 5/30/2016

6.00% to 14.00%

7/1/2013 to 7/31/2013 13,674 12,629 11,400

12/21/2015 to 7/23/2018

6.00% to 14.00%

8/1/2013 to 8/30/2013 8,251 7,653 6,279

12/21/2015 to 8/22/2016

5.50% to 14.00%

9/5/2013 to 9/16/2013 845 778 626 8/22/2016

5.50%

10/24/2013 699 644 519 8/22/2016

5.50%

11/19/2013 1,390 1,280 1,031 8/22/2016

5.50%

12/6/2013 to 12/27/2013 9,988 9,206 7,418

12/21/2015 to 12/27/2016

5.50% to 14.00%

1/2/2014 to 1/16/2014 5,751 5,294 0 12/27/2016

5.50%

3/7/2014 1,458 1,367 0 12/21/2015

14.00%

5/15/2014 to 5/29/2014 7,237 6,663 0 5/15/2017

5.50%

6/9/2014 to 6/19/2014 8,355 7,692 0 5/15/2017

5.50%

9/23/2014 2,599 2,392 0 5/30/2016

6.00%

10/16/2014 15,114 14,169 0 10/16/2017

12.00%

1/12/2015 59 0 0 12/21/2015

14.00%

3/19/2015 to 3/26/2015 23,284 0 0

12/27/2016 to 3/26/2018

5.50% to 10.50%

4/17/2015 26 0 0 5/13/2016

6.00%

166,642 132,956 81,269

Nicaragua 10/9/2013 to 10/30/2013 5,860 13,159 19,268

10/9/2015 to 10/30/2015

5.00% to 5.25%

11/7/2013 to 11/20/2013 4,535 8,524 780 10/30/2015

5.00%

12/6/2013 to 12/26/2013 1,052 0 0 11/4/2016

5.00%

1/24/2014 780 0 0 11/6/2017

5.25%

4/22/2014 2,599 0 0 11/6/2017

5.25%

6/9/2014 52 0 0 11/6/2017

5.25%

7/31/2014 1,949 0 0 11/6/2017

5.25%

9/1/2014 151 0 0 11/6/2017

5.25%

(Continued)

123




June 30, 2015

December 31, 2014


Interest Rate

Nicaragua

10/10/2014 to 10/29/2014 14,371 10,766 0

10/10/2015 to 11/6/2017

5.00% to 5.25%

12/10/2014 520 478 0 11/6/2017

5.25%

1/13/2015 122 0 0 11/6/2017

5.25%

2/2/2015 1,473 0 0 11/6/2017

5.25%

33,464 32,927 20,048

Panama 10/6/2011 to 10/27/2011 13,381 12,321 9,924

10/6/2021 to 10/27/2021

5.25%

3/14/2012 3,898 3,589 2,890 3/14/2020

4.75%

5/31/2013 0 0 38,537 5/31/2016

3.75%

17,279 15,910 51,351 Total BAC Credomatic

982,712

846,904

552,138 Total foreign currency

3,886,671

3,515,647

2,693,657

Total bonds

COP 6,026,307

5,485,151

4,701,731

25. Employee benefits

The balance of employee benefit provisions at June 30, 2015, December 31, 2014 and January 1, 2014, breaks down as follows:

June 30,

2015 December 31, 2014

(1)

January 01,

2014 (1)

Short-term benefits COP 312,490 271,346 210,308 Employee withdrawal benefits 134,440 135,829 140,000 Long-term benefits 101,584 103,078 117,813

COP 548,514 510,253 468,121 (1) Including COP 5,377 and COP 15,874 respectively, which were recorded in miscellaneous accounts.

Short-term Benefits

According to Colombian labor law and based on the labor conventions and collective agreements signed with employees, all Bank employees have rights to short-term benefits, such as: salaries, vacations, legal and voluntary bonuses, and severance pay and interest on severance pay in accordance with labor regulations, Law 50 / 1990; long-term benefits, such as: voluntary seniority and discretionary service bonuses and severance fees for employees in accordance to Law 50 / 1990; and withdrawal benefits, such as: withdrawal bonus and retirement pensions. Employee Withdrawal Benefits

• In Colombia, pensions when employees retire after reaching a certain age and number of years of

service are assumed by public and private pension funds based on established contribution plans where companies and employees pay monthly amounts established by law to access the employee retirement pension. However, for some employees hired before 1968 who met the years of service and age requirements, the pensions are assumed directly by the Bank.

• The Bank provides an additional voluntary bonus, or bonus by collective agreement, for employees who

retire once they reach the age and years of service to enjoy the pension granted by pension funds.

(Continued)

124



The table below shows the activity of employee withdrawal benefits and long-term benefits during the semesters ending at June 30, 2015 and December 31, 2014:

Pension Plans Other Benefits (1)

June 30,

2015 December 31, 2014

June 30,

2015 December 31, 2014

Initial Balance COP 135,829 139,973 103,078 118,016 Costs incurred during the period

595 1,022 4,469 12,846

Interest costs

4,845 9,892 3,188 7,737 Costs of past services

0 (1,448) 0 0

5,440 9,466 7,657 20,583

Employer contributions to the plan

0 (9,589) 0 0

Changes in actuarial assumptions

122 (105) 0 (477) (Gain)/Losses due to changes in mortality tables

14 0 (47) 0

(Gain)/Losses on change in interest rates, inflation rates and salary adjustments

(96) (479) 0 (15,633)

(Gain)/Losses on actuarial assumptions of employee turnover

0 57 0 (828)

40 (527) (47) (16,938)

Exchange difference Payment of employees

(6,869) (3,494) (9,104) (6,847) (Gain)/Losses due to direct settlements with employees

0 0 0 (11,736)

(6,869) (3,494) (9,104) (18,583) Balance at the end of the period COP 134,440 135,829 101,584 103,078

(1) Other benefits are comprised of voluntary seniority bonuses, severance pay in accordance with labor regulations prior to Law 50 / 1990, and

withdrawal bonds. Actuarial Assumptions The variables used to calculate the forecast obligation of the different withdrawal benefits and other long-term benefits are shown below:

June 30, 2015

December 31, 2014

January 01,

2014

Discount rate 7.60% 7.60% 7.50% Inflation rate 3.00% 3.00% 3.00% Salary increase rate 3.00% 3.00% 3.00% Pension increase rate 3.00% 3.00% 3.00% Employee rotation rate 3.55% 3.55% 3.55%

Employee rotation rate (between 1 and 40 years of service for men and women - the following average rotation rate) The employees' life expectancy is calculated based on the mortality tables published by the Colombian Financial Superintendence, which have been constructed based on mortality experiences supplied by the different insurance companies that operate in Colombia.

(Continued)

125



Sensitivity Analysis The sensitivity analysis of the employee withdrawal benefit liability of the different financial and actuarial benefits is as follows, maintaining the following variables constant:

Pensions Change in Variable Increase in Variable

Decrease in Variable

+50 points -50 points Discount rate 0.50% 5.06% decrease 5.34% increase Salary growth rate 0.50% 5.39% decrease 5.63% increase Pension growth rate 0.50% 5.39% decrease 5.63% increase

Other Long-term Benefits Change in

Variable Increase in Variable Decrease in

Variable

+50 points -50 points Discount rate 0.50% 4.81% increase 4.38% decrease Salary growth rate 0.50% 4.63% decrease 5.03% increase Pension growth rate 0.50% 4.63% decrease 5.03% increase

Long-term employment benefits:

• The Bank grants its employees voluntary long-term seniority bonuses depending on the years of service every five, ten, fifteen and twenty years, etc. Each payment is calculated as salary days (from 15 to 180 days).

• The Bank has a group of employees with severance pay benefit prior to the issue of Law 50 / 1990, by which said benefit is accumulative and is issued based on the last salary that the employee received, multiplied by the number of years of service, minus advances that have been made on the new benefit.

The remuneration of key management personnel for each category of benefits granted is disclosed in Note 35 Related Parties.

26. Provisions

Allowance activity is as follows:

Legal Processes,

Fines, Sanctions and

Compensations

Tax Other

than Income Tax

Other

Miscellaneous Allowances

Total

Balance at June 30, 2014 COP 99,433 4,179 478,952 582,564 New allowances 35,794 2,820 7,866 46,480 Increase (decrease) in existing allowances (4,685) (329) 1,564 (3,450) Used allowances (18,674) 0 (18,227) (36,901) Reversed unused allowances 0 0 (12,599) (12,599) Increase (decrease) due to net exchange differences 0 0 15,356 15,356 Increase (decrease) due to transfers and other changes 0 (51) 0 (51)

Balance at December 31, 2014 111,868 6,619 472,912 591,399 New allowances 5,884 8,372 3,786 18,042 Increase (decrease) in existing allowances 2,061 (2,851) (6,334) (7,124) Used allowances (16,201) (2,923) (12,510) (31,634) Increase due to adjustments arising over time 725 0 0 725 Increase (decrease) due to net exchange differences 0 0 6,513 6,513 Balance at June 30, 2015 (1) COP 104,337 9,217 464,367 577,921

(1) At June 30, 2015, the reclassification of other provisions is included in the income tax and CREE account payable for a total of COP 183,983.

(Continued)

126



The allowances for the Group's legal processes are mainly: • Administrative Proceedings

They are mainly the following tax uncertainties:

Tax

Uncertainties Balance at June 30, 2014 COP 24,255 Increase in allowances during the year 1,308 Amounts reversed due to unused allowances (21,593) Balance at December 31, 2014 3,970 Increase in allowances during the year 201 Amounts reversed due to unused allowances (703) Balance at June 30, 2015 COP 3,468

At June 30, 2015 and December 31, 2014, our subsidiary Leasing Bogotá Panamá had unrecognized tax positions amounting to COP 69,939 and COP 65,863, respectively, which include all interest and penalties. At June 2015, the Parent Company recorded an allowance for sanctions for COP 7,477 generated on the higher income tax payable due to the correction of the income tax and complementary tax return for the 2013 tax year, and an estimated allowance for tax positions for COP 2,417, which was realized in July 2015. The balance at June 30, 2015 is expected to be used fully or released when the tax authorities' right to inspection with respect to the tax returns expires, as follows:

Year

Corficolombiana S.A. Porvenir S.A. Consolidated

2015 COP 207 411 618 2016 231 0 231 2017 40 0 40

• Labor Cases

- At June 30, 2015 and December 31, 2014, the Parent Company paid COP 4,093 and COP 3,108 respectively on account of labor-related lawsuits.

- At June 30, 2015 and December 31, 2014, Corficolombiana of the Promigas S.A. subsidiary paid COP 32,107 and COP 32,888 respectively for the alleged breach of contract in the construction of the Gibraltar-Bucaramanga pipeline.

• Other provisions

- At June 30, 2015 and December 31, 2014, Porvenir S.A. paid COP COP 14,945 and COP 13,857 respectively on account of pension claims (survivor, disability, old-age, reimbursement of balances, etc.).

- At June 30, 2015 and December 31, 2014, Corficolombiana of the Hoteles Estelar subsidiary, paid COP 24,088 and COP 31,377, respectively, for the proceedings declaring the violation of rights on account of the occupation of public space in the municipality of Cartagena.

(Continued)

127



27. Accounts Payable and Other Liabilities

The accounts payable and other liabilities for the semesters ended on June 30, 2015, December 31 and January 1, 2014 break down as follows:

June 30,

2015 December 31, 2014

January 01, 2014

Providers and Services Payable COP 628,864 609,653 369,011 Cashier's Checks 299,642 437,078 239,630 Dividends and Surpluses 288,469 291,094 298,725 Other accounts payable 420.084 233,134 150,782 Tax payable 245,543 101,338 216,463 Withholdings and employer contributions 180,101 190,097 191,014 Leasing Bogotá Panamá S.A. Collections 108,003 15,131 28,323 Clearing ACH and Cenit transactions 83,342 154,619 109,939 Other liabilities 81.651 115,387 136,954 Prepayments and advances received 80,028 78,360 78,099 Collections made 77,961 78,708 76,758 Transactions in ATH network ATMs 75,029 172,732 72,036 Other anticipated revenue 68,799 22,033 15,066 Commission and fees 65.779 71,064 46,782 Affiliated Establishments 50,161 71,249 53,582 Distribution of funds pending payment to customers 31,634 4,629 2,520 Loyalty Programs 31,467 27,034 14,158 Cash Surplus 29,907 2,580 1,425 Peace bonds interest and capital accounts payable 29,216 28,543 28,522 Collection services 28,722 31,582 23,277 Prospective Purchasers 27,029 10,497 2,587 Visa smart card payments - Visa Electron 25,923 30,558 25,939 Contributions on Transactions 24,688 13,060 25,874 Certificate of deposit - securities due 24,408 24,106 28,177 Withdrawals from ATMs 20,702 788 2,892 Checks drawn and not cashed 19,902 17,576 70,091 Canceled accounts 18,128 17,931 17,336 Insurance premiums 17,912 34,111 13,179 Payments, affiliations and transfers 16,280 16,855 9,859 Liens orders 14,492 16,021 18,274 Electronic purse used by coffee growers 13,124 16,159 99,740 Loan accounts payable or prepaid fines 8,508 8,839 1,547 Outstanding payments credit operations 7,975 6,352 11,512 Leases payable 7,737 6,088 5,467 Security bonds 7,363 7,368 7,316 Balance in favor of paid loans 6,721 6,330 5,151 Unhedged forward accounts 4,682 0 1,064 Bank services 4,388 3,868 17,651 Plane leaseback 3,637 3,864 3,941 Payroll payments and deductions 3,557 343 1,007 Accounts Receivable from Cardholders 2,245 4,469 8,989 Write-off card agreements 1,181 1,285 582 COP 3,184,984 2,982,513 2,531,241

(Continued)

128



28. Equity

• Capital in shares

The Bank's authorized, issued and outstanding shares have a nominal value of COP 10.00 each. At June 30, 2015, December 31 and January 01, 2014, they were represented as follows:

June 30, 2015

December 31, 2014

January 01, 2014

Number of authorized shares

500,000,000

500,000,000

500,000,000 Number of subscribed and paid shares

331,280,555

331,280,555

307,471,032

Subscribed and paid capital COP 3,313

3,313

3,075 Between November 12 and December 16, 2014, the Bank issued ordinary shares amounting to COP 1,500,000, equivalent to 23.8 million shares at a price of COP 63,000 per share with the right to preferential subscription.

• Reserves

The composition of reserves at June 30, 2015, December 31 and January 1, 2014, is as follows:

June 30, 2015

December 31, 2014

January 01, 2014

Legal reserves

Appropriation of net profit COP 3,809,086

3,580,624 3,182,514

Statutory and occasional reserves

At the disposal of the Board of Directors

40,951

19,611 8,560 Tax provisions

205,134

222,617 259,240

Other

626,371

672,824 524,704

872,456

915,052 792,504

COP 4,681,542

4,495,676 3,975,018

Legal reserve According to legal provisions, all lending institutions must create a legal reserve, appropriating ten point zero percent (10.0%) of its net earnings of each period until reaching fifty point zero percent (50.0%) of its subscribed capital. The reserve may be reduced to less than fifty point zero percent (50.0%) of the subscribed capital when its objective is to cover losses in excess of undistributed profits. The legal reserve may not be used for the payment of dividends, nor to cover expenses or losses during the time in which the Bank has undistributed profits. Statutory and voluntary reserves These are established at the General Meetings of Shareholders.

(Continued)

129



• Declared dividends

Dividends are decreed and paid to shareholders based on the unconsolidated net income of the preceding semester. Declared dividends were as follows:

June 30, 2015 December 31, 2014

Unconsolidated earnings from the preceding period COP 770,734

734,528

Dividends paid in cash

COP 210.00 per share payable in the first ten (10) days of each month from April 2015 to September 2015 (based on earnings of the second semester of 2014).

COP 210.00 per share payable in the first ten (10) days of each month from October 2014 to March 2015 (based on earnings of the first semester of 2014).

Total outstanding common shares

331,280,555 331,280,555 Total dividends declared COP 417,413 387,413

The General Meeting of Shareholders held on September 29, 2015 proposed a dividend of COP 220 per share for the period ended, which would mean a total dividend of COP 437,290. These financial statements do not reflect this dividend.

• Basic and Diluted Earnings per Share

The calculation of earnings per share for the semesters ending at June 30, 2015 and December 31, 2014, breaks down as follows:

June 30, 2015

December 31, 2014

Earnings of the period COP 1,006,436 706,535 Outstanding common shares

331,280,555 311,739,054

Basic and diluted earnings per share COP 3,038 2,266

(1) There are no rights or privileges concerning outstanding common shares.

See capital management policies in Note 36

29. Noncontrolling Interest

June 30, 2015

Share %

Value equity share

Share in Income

Dividends paid in the

period Almacenes Generales de Depósito Almaviva S.A.

5,08 COP 3,077 217 387


5,01

10,425 1,642 1,441 Corporación Financiera Colombiana S.A.

61,81

2,643,788 161,228 247,270

Sociedad Administradora de Pensiones y Cesantías Porvenir S.A

63,49

795,303 92,714 75,006

Megalinea S.A.

5,10

154 33 0 Casa de Bolsa S.A.

77,20

21,916 408 278

Others (1)

456,019 140,512 119,900

COP 3,930,682 396,754 444,282

(Continued)

130



December 31, 2014

Share %

Value equity share

Share in Income

Dividends paid in the

period Almacenes Generales de Depósito Almaviva S.A.

5,08 COP 2,993 577 294


5,01

9,504 1,524 1,444 Corporación Financiera Colombiana S.A.

61,81

2,610,813 159,433 179,255

Sociedad Administradora de Pensiones y Cesantías Porvenir S.A

63,49

755,012 80,059 70,992

Megalinea S.A.

5,10

122 7 0 Casa de Bolsa S.A.

77,20

21,978 204 0

Others (1)

430,626 124,700 158,300

COP 3,831,048 366,504 410,285

(1) This is noncontrolling interest of the subsidiaries that subconsolidate; mainly Corficolombiana, Leasing Bogotá Panama and Porvenir.

30. Income, Expenses from Commission and Other Services

The income, commission expenses and other services for the semesters ending at June 30, 2015 and December 31, 2014, are as follows:

June 30, 2015

December 31, 2014

Income from commissions and fees Commissions from transfers, checks and checkbooks COP 113,481 17,134

Pension and severance fund management

393,163 379,885 Commissions from banking services

711,660 680,981

Credit card commissions

180,130 162,494 Income from trust company activities

82,083 77,916

Other commissions

71,509 65,643 Storage Service

54,702 71,380

Office network services

12,521 16,567

1,619,249 1,472,000

Commission and fee expenses

Commissions from banking services

90,528 60,424

Income from trust company activities

3,382 25 Office network services

18,978 16,322

Management and brokerage services

1,315 0 Information processing services 4,125 4,447 Sales and services 3,417 0 Other

31,615 29,804

Enrollments in Pension Funds

0 33,908

153,360 144,930

Total COP 1,465,889 1,327,070

31. Other Income

Other income during the semesters ending at June 30, 2015 and December 31, 2014, is as follows:

June 30, 2015

December 31, 2014

Dividends COP 11,043 65,398 Net gain from exchange difference 181,811 281,823 Net gain (loss) on derivative financial instruments 33,083 (137,492) Net gain on the sale of investments (184) 480

(Continued)

131



June 30, 2015

December 31, 2014

Net gain on the valuation of biological assets 9,237 0 Earnings from sale of noncurrent assets held for sale 14,192 11,377 Revenue from the sale of assets and services of non-financial sector companies 2,384,496 2,492,257 Recovery of charge-offs 46,633 48,479 Share in earnings of associate companies and joint ventures

85,476 79,259

Recovery of allowances foreclosed assets

4,869 7,452 Recovery of expenses from previous periods

0 2,142

Provision of liabilities declared as abandoned

1,638 3,098 Recovery of Loans Written Off

12,469 24,918

Recovery of 2014 CREE income tax for equality allowance

77,777 0 Reversals of exemptions from financial transaction tax

3,710 0

Cash transportation service

3,936 3,767 Sale of Foreclosed and Returned Assets

0 2,127

Recoveries

8,902 0 Adjustments on investments

6,050 0

Corficolombiana Leverage

8,953 5,613 Recovery of allowances

0 12,599

Recovery from losses

0 5,656 Earnings from sale of property and equipment

2,907 14,001

Other

76,597 93,512 Total net income from commission. COP 2,973,595 3,016,466

32. Other expenses

Other income during the semesters ending at June 30, 2015 and December 31, 2014, is as follows:

June 30, 2015

December 31, 2014

Consumption of raw materials and secondary materials COP 1,380,953 1,554,359 Loss from sale of noncurrent assets held for sale 1,880 7,324 Severance pay 16,600 11,298 Employee benefit expenses 1,178,728 1,013,222 Financial expenditures, taxes, rates and operating expenses 1,329,126 1,229,217 Depreciation expenses 119,417 109,729 Intangible asset amortization expenses 119,194 87,921 Loss due to impairment of foreclosed assets 14,029 7,558 Donations 9,168 7,531 Administrative Proceedings 11,179 6,396 Sanctions and penalties 123 14,180 Pension fund provisions 5,380 0 Other provisions Corficolombiana 0 6,069 Loss in sale of property and equipment 2,467 8,231 Losses due to claims loan portfolio 10,122 8,517 Other 8,670 89,795 COP 4,207,036 4,161,347

33. Commitments and Contingencies

• Credit Commitments

Regarding the development of its normal operations, the Group's financial entities grant guarantees or letters of credit to their customers with which the group irrevocably commits to make payments to third parties in the event that the customers do not comply with their obligations with the same third parties,

(Continued)

132



with the same credit risk as the loan portfolio financial assets. The granting of guarantees and letters of credit is subject to the same loan disbursement authorization policies in terms of the customers' credit rating, and the guarantees considered appropriate in the circumstances are obtained. The commitments for credit extensions represent unused portions of authorizations to extend credits in the form of loans, use of credit cards and letters of credit. Regarding the credit risk of commitments to extend lines of credit, the Group is potentially exposed to losses in an amount equal to the total amount of the unused commitment, if the total unused amount were to be fully withdrawn. However, the loss amount is less than the total amount of the unused commitments, given that the majority of the commitments to extend credits are contingent once the customer maintains the specific credit risk standards. The Group monitors the expiration terms of the relative credit limit commitments, because long-term commitments have a greater credit risk than short-term commitments. The table below shows the details of unused guarantees, letters of credit and credit commitments in unused lines of credit at June 30, 2015, December 31 and December 31, 2014.

June 30,

2015 December 31, 2014

January 01, 2014

Notional

Amount Notional Amount Notional

Amount Collateral COP 2,332,401 1,913,378 1,991,813 Unused letters of credit 522,981 544,052 589,702 Overdraft limits 210,366 222,565 242,030 Unused credit card limits 2,488,500 2,397,459 2,362,543 Opening line of credit 2,205,310 2,368,484 2,268,801 Undisbursed approved loans 35,000 35,000 133,600 Other 385,494 455,605 493,788 Total COP 8,180,052 7,936,543 8,082,277

The outstanding balances of the unused lines of credit and guarantees do not necessarily represent future cash requirements, as said limits may expire and cannot be used neither partially nor fully. The following provides the details of credit commitments by type of currency:

Loan commitments by type of currency

June 30, 2015

December 31, 2014

January 01, 2014

Colombian pesos COP 6,235,551 6,030,809 6,162,494 US dollars 777,938 777,707 798,026 Euros 24,569 31,057 46,071 Other 2,016 3,845 893 Total COP 7,040,074 6,843,418 7,007,484

Commitments to Disburse Funds for Capital Expenses

At June 30, 2015, the Group had contractual commitments for the disbursement of capital expenses for COP 1,559 (December 31, 2014, COP 1,239). The Group has allocated the resources necessary to fulfill these commitments and considers that the net income and the funds will be sufficient to cover these and other similar commitments.

(Continued)

133



Operating Lease Commitments

In the development of its operations, the Group's subsidiaries sign contracts to receive property, plant and equipment and certain intangible assets by operating lease. The following is the breakdown of the payment commitments of operating lease fees in the upcoming years.

June 30,

2015 December 31, 2014

Less than one year COP 69,320 65,610 More than one year and less than five years 254,117 251,467 More than five years 199,639 185,333 Total COP 523,076 502,410

The Group maintains several lease transactions for the use of bank offices, mainly: • At June 30, 2015 and December 31, 2014, the Parent Company had operating lease agreements on

property, plant and equipment and intangibles for COP 522,023 and COP 501,455, respectively. • Leasing Bogotá Panama has an agreement for the lease of an aircraft with disbursements at June 30,

2015 and December 31, 2014 for COP 1,053 and COP 955, respectively. The expense of operating leases for the period ended on June 30, 2015 included the rental cost for COP 45,498.

• Contingencies

Legal Contingencies From time to time in the normal course of operations, there are claims filed against the Group or its subsidiaries based on its estimates and, with the help of external consultants, the Group's management has said that there will be no significant losses incurred in relation to said claims, and therefore, no provisions have been made for this purpose in the consolidated financial statements. At June 30, 2015 and December 31, 2014, the most significant legal contingencies are:

• Parent Company COP 14,964 and COP 11,330, respectively, for labor-related lawsuits, which have

historically been settled in favor of the Bank.

• Fidubogotá is dealing with a class action since 2014 for COP 31,114 due to the claim filed by Rosa Elena Perdomo declaring the entity responsible for omissions in the construction of Phase II fo the Bosques de San Luis Phase macro-project.

• In 2013, Casa de Bolsa filed a legal claim against Interbolsa demanding the refund of the payments

made for repo transactions by the entity for a total of COP 1,680. However, they have recognized a provision for COP 868,454 to pay the holders of said transactions.

• Porvenir is dealing with labor-related lawsuits for COP 4,658, by provisioning the amount of COP 567

for possible disbursements. In addition, at June 30, 2015 and December 31, 2014, there are provisions for COP 14,945 and COP 13,857 for proceedings with and without pension coverage.

(Continued)

134



34. First-time Adoption in Alignment with the International Financial Reporting Standards (IFRS)

By means of Law 1314 / 2009, the Colombian government regulated the accounting and financial information principles and standards accepted in Colombia, with the aim to create a single, high quality system for reporting financial information. Therefore, Decree 2784 / 2012 and other amending decrees were issued, whereby it established a regulatory system for the preparation of financial information classified in Group 1, according to the parameters established in said decree, called the Technical Regulatory Framework. Banco de Bogotá was classified in said category as an entity of public interest and a securities issuer. The Technical Regulatory Framework applicable to the Group in the preparation of consolidated financial statements is based on the IFRS published by the International Accounting Standards Board (IASB) at January 1, 2013, except for the following: 1. Recognition in Other Comprehensive Income of the differences between the provisions of the loan

portfolio according to IFRS and the accounting standards of the Colombian Financial Superintendence and, as a result, maintaining the recognition of the loan portfolio impairment in the statement of income as per instructions of the Colombian Financial Superintendence based on expected losses.

2. Accrual in annual payments and the option of charging wealth tax to the equity reserves without affecting income, as provided by Law 1739 / 2014.

For presentation and disclosure purposes in these consolidated financial statements, these new accounting standards, as a whole, are referred to as Colombian Financial Reporting Standards (NCIF, for the Spanish original). In compliance with instructions from the Colombian Financial Superintendence in External Bulletin 036 / 2014, net positive differences generated in the first application of the IFRS cannot be distributed to cover losses, in capitalization processes, to distribute profits and/or dividends or to be recognized as reserves, and they can only be accessed when this is effectively done with third parties, other than the related parties, and ii) net positive differences generated in the first application of the IFRS will be used in calculating the required technical equity, or minimum operating capital, depending on the nature of each entity. If net negative differences are generated, they must be deducted from the technical equity. The Group prepared the Opening Statement of Financial Position at January 01, 2014, in accordance with the IFRS, taking into account the provisions of IFRS 1 “First-time Adoption of International Financial Reporting Standards” and other legal provisions applicable in Colombia for recognition of the transition of its financial statements from the previous accounting standards (Previous GAAP) to the IFRS. The Group applied the instructions of the Colombian Financial Superintendence in relation to recognition in Other Comprehensive Income of the differences in loan portfolio provisions and the accounting treatment of wealth tax, mentioned earlier, and, in all other aspects, the requirements of IFRS 1, consisting mainly of: • Preparing an opening statement of financial position on the date of transition to the IFRS. • Selecting the relevant accounting policies and applying them retroactively to all the periods presented in

the first financial statements according to IFRS. • Considering the application of any of the optional exemptions contained in Appendices C through E of

IFRS 1.

(Continued)

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• Applying the mandatory exceptions contained in paragraphs 14 through 17 and Appendix B of IFRS 1. • Making disclosures to explain transition to the International Financial Reporting Standards. • Recognizing the assets and liabilities whose recognition was required by the IFRS. • Not recognizing items as assets or liabilities if not allowed by the IFRS. • Reclassifying items recognized according to the Previous GAAP as a type of asset, liability or equity

component, that are a different type of asset, liability or equity component according to the IFRS. • Applying the IFRS to measure all recognized assets and liabilities. Exemptions and Exceptions In its opening statement of financial position, the Group has: • Provided comparative financial information. • Applied the same accounting principles for the periods presented herein. • Retrospectively applied the current standards through December 31, 2012 as required by Decree 3023 /

December 2013. • Applied certain optional and mandatory exemptions as permitted or required in IFRS 1. The main exemptions and exceptions applied in preparing the Group’s opening statement of financial position from the Previous GAAP to the NCIF on January 1, 2014 are: Exemptions 1. Attributed cost IFRS 1 allows the separate measurement of certain property, plant and equipment at fair value or the use of a revaluation in line with previously accepted accounting principles in Colombia such as the attributed cost of said assets on the transaction date. The Group has chosen to use this exemption for some of the assets and to record them, on the transition date, at the revalued amount according to previously accepted accounting principles in Colombia. 2. Designation of previously recognized financial instruments IFRS 1 allows an entity to designate a financial asset as measured at fair value according to IFRS 9, based on the events and circumstances on the IFRS transition date. 3. Accumulated conversion differences According to IAS 21, the adjustment resulting from converting the financial statements of the subsidiaries abroad is recored in equity in the other comprehensive income account; however, according to IFRS 1, in the preparation of the opening statement of financial position, allows the value determined on this account of all the subsidiaries abroad on this date to be zero.

4. Measuring the fair value of financial assets or liabilities to recognize them initially In the Group's normal course of business, the initial recognition of certain financial asset or liability transactions can differ from their fair value, in which case said transactions must be adjusted to their fair value. However, IFRS 1 allows the application of this accounting standard prospectively on transactions performed after the IFRS transition date, that is to say, at January 01, 2014.

(Continued)

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5. Concession agreements The rights resulting from concession agreements according to the IFRS may give rise to a financial, intangible or mixed- assets. This definition is determined when the concession agreement is signed. However, if the retroactive application of this standard is impracticable on the transition date, IFRS 1 allows the Group's subsidiary handling this type of agreements to use the previous book values of the financial and intangible assets as the book values on that date the retroactive application of this standard, subject to verification of impairment on that date. 6. Loan costs The IFRS require the financial costs of an entity in the process of construction of property and equipment to be capitalized in the cost of said assets according to certain parameters. However, IFRS 1 allows the capitalization process on the transition date on eligible assets, consisting of those that require a substantial period before they are ready for use or sale. 7. Business combinations IFRS 3 "Business Combinations" requires the accounting of business combinations using the purchase method. Based on this method, the capital gain originated by the business combination is determined at the time of the purchase by the difference between the amount paid and the net value of the assets and liabilities acquired, determined based on their fair value with some exceptions. However, according to IFRS 1, first-time adopters could opt not to apply IFRS 3 retroactively to business combinations executed in the past. Exceptions 1. Derecognition of financial assets and financial liabilities accounts IFRS 9 requires the fulfillment of certain requirements to dispose of financial assets on the balance sheet. However, IFRS 1 requires entities adopting the IFRS for the first time to comply with these requirements going forward for all transactions occurring after the IFRS transition date. 2. Classification and measurement of financial assets Financial assets and liabilities that should be measured at amortized cost are determined based on facts and circumstances existing on the IFRS transition date. 3. Accounting estimates Estimates made according to the IFRS on the transition date will be consistent with the estimates made on the same date according to the previous GAAP, unless there is objective evidence that the estimates were erroneous.

4. Hedge Accounting

On the date of transition to IFRS, as required by IFRS 9, an entity: (i) will measure all derivatives at fair value; and (ii) will eliminate all deferred profit and loss resulting from derivatives, that it has recorded according to the previous GAAP as if they were assets or liabilities.

(Continued)

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In its statement of financial position according to the IFRS, an entity will not reflect any coverage relationships that do not meet the conditions of coverage accounting according to IAS 39. However, if an entity indicated a net position as a covered item, according to the previous GAAP, it may designate an individual item in that net position as a covered item according to the IFRS, provided that it is not carried out following the date of transition to IFRS. Opening Statement of Financial Position The Group’s opening statement of financial position under Previous GAAP and under the adapted NCIF at January 01 2014 breaks down as follows:

Previous GAAP

January 01 2014

Adjustments and reclassification

before the consolidation of Promigas and subsidiaries

Promigas and

subsidiaries under NCIF

(1)

NCIF

January 31 2014

Assets Cash and Cash Equivalents COP 10,490,140 416,204 146,903 11,053,247

Financial Investment Assets

17,870,598 (1,565,505) 140,088 16,445,181 Loan portfolio and capital lease transactions at amortized cost

59,141,011 662,479 0 59,803,490


1,810,204 (524,489) 2,479,546 3,765,261 Coverage derivatives

16,680 1,533 0 18,213

Noncurrent Assets Held for Sale

81,866 223,164 490 305,520 Property, Plant and Equipment

3,164,129 (678,360) 1,085,485 3,571,254

Investment Properties

0 157,594 0 157,594 Biological Assets

487 200,696 0 201,183

Intangible Assets

4,132,815 630,298 1,354,320 6,117,433 Income tax

368,009 61,196 214,653 643,858

Investments in Associates and Joint Ventures

1,773,147 (1,597,544) 363,245 538,848 Other Assets

1,819,946 (1,641,963) 81,271 259,254

Total assets

100,669,032 (3,654,697) 5,866,001 102,880,336 Liabilities

Trading derivatives

156,927 37,163 0 194,090 Client deposits

63,843,648 (71,939) 0 63,771,709

Short-term Borrowings

4,280,172 5,723,765 0 10,003,937 Coverage derivatives

55,439 (1,300) 0 54,139

Employee benefits

325,916 123,059 19,147 468,122 Provisions

234,609 343,436 11,663 589,708

Income tax

455,200 409,343 763,598 1,628,141 Accounts payable and other liabilities

3,121,854 (1,233,308) 642,695 2,531,241


11,547,235 (5,824,472) 795,713 6,518,476 Long-term outstanding investment securities

3,268,229 (15,771) 1,449,273 4,701,731

Noncontrolling Interest

3,482,437 (3,580,618) 98,181 0 Total liabilities

90,771,666 (4,090,642) 3,780,270 90,461,294

(Continued)

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Previous GAAP

January 01 2014

Adjustments and reclassification

before the consolidation of Promigas and subsidiaries

Promigas and

subsidiaries under NCIF

(1)

NCIF January 31

2014

Equity Subscribed and paid capital

3,075 (109,883) 109,883 3,075 Additional paid-in capital

4,221,859 (152,448) 152,448 4,221,859

Accumulated earnings

4,814,569 (493,414) 363,645 4,684,800 Other Comprehensive Income

857,863 (2,345,985) 1,459,755 (28,367)

Total Equity Attributable to the Shareholders of the Parent Company (2)

9,897,366 (3,101,730) 2,085,731 8,881,367


0 3,537,675 0 3,537,675 Total equity

9,897,366 435,945 2,085,731 12,419,042

Total liabilities and equity COP 100,669,032 (3,654,697) 5,866,001 102,880,336 (1) As a result of applying IFRS 10, the consolidation of Promigas and subsidiaries was included through

the Corficolombiana subsidiary. The incorporated balances are the assets and liabilities of Promigas and subsidiaries under NCIF before determining the non-controlling interest of the Group in Promigas. See explanation (a). in the notes to the reconciliations.

(2) Due to the effect of adopting the NCIF, the equity attributable to shareholders of the Parent Company dropped by (COP 1,015,999) Adjustments and reclassification before the consolidation of Promigas and subsidiaries for (COP 3,101,730) net of the consolidated equity of Promigas and subsidiaries of COP 2,085,731. See reconciliation of equity herein.

The Group’s opening statement of financial position under Previous GAAP and under the adapted NCIF at December 31, 2014 breaks down as follows:

Previous GAAP December 31

2014 Adjustments and Reclassifications

NCIF December 31

2014 Assets

Cash and Cash Equivalents COP 13,353,946 246,982 13,600,928 Financial Investment Assets

17,790,121 (1,424,964) 16,365,157

Loan portfolio and capital lease transactions at amortized cost 71,673,035 523,076 72,196,111


2,459,879 2,005,154 4,465,033 Coverage derivatives

57,474 7,378 64,852

Noncurrent Assets Held for Sale 108,774 113,912 222,686 Property, Plant and Equipment

3,487,956 416,626 3,904,582

Biological Assets

381 202,018 202,399 Investment Properties

0 180,925 180,925

Intangible Assets

4,761,866 2,319,112 7,080,978 Income tax

562,624 706,746 1,269,370

Investments in Associates and Joint Ventures 1,883,761 (1,191,375) 692,386 Other Assets

2,226,826

(1,908,113)

318,713

Total assets

118,366,643

2,197,477

120,564,120 Liabilities

Trading derivatives

923,861

26,620

950,481 Client deposits

73,698,043

(45,336)

73,652,707

Short-term Borrowings

3,209,370

6,101,882

9,311,252 Coverage derivatives

531,749

39,896

571,645

Employee benefits

368,771

141,482

510,253 Provisions

301,334

290,065

591,399

Income tax

734,313

1,612,359

2,346,672 Accounts payable and other liabilities

4,107,967

(1,125,454)

2,982,513


14,359,883

(5,168,679)

9,191,204

(Continued)

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Previous GAAP December 31

2014 Adjustments and Reclassifications

NCIF December 31

2014 Liabilities

Long-term outstanding investment securities 4,071,302

1,413,849

5,485,151 Noncontrolling Interest

3,857,253

(3,857,253)

0

Total liabilities

106,163,846

(570,569)

105,593,277 Equity

Subscribed and paid capital

3,313 0 3,313 Additional paid-in capital

5,721,621 0 5,721,621

Accumulated earnings

5,425,278 11,334 5,436,612 Other Comprehensive Income

1,052,585 (1,074,336) (21,751)

Total Equity Attributable to the Shareholders of the Parent Company

12,202,797 (1,063,002) 11,139,795


0 3,831,048 3,831,048 Total equity

12,202,797 2,768,046 14,970,843

Total liabilities and equity COP 118,366,643 2,197,477 120,564,120

Reconciliation of Equity The Group’s reconciliation of equity under Previous GAAP and under the NCIF at January 1 2014 and December 31 2014 breaks down as follows:

Note January 01,

2014 December 31, 2014

Equity balance under Previous GAAP

COP 9,897,366 12,202,797 Promigas and Subsidiaries Consolidation a

(589,284) (783,297)

Cash and cash equivalents: b

2,061 447 Investments c

251,830 180,017

Joint operations d

3,041 2,591 Concessions e

3,437 43,460

Loan portfolio and capital lease transactions at amortized cost f

309,694 357,558 Property, plant and equipment, and investment property g

(527,927) (576,040)

Noncurrent Assets Held for Sale (BRPs) h

54,811 115,853 Capital Gains i

(1,585) 185,751

Deferred charges and other assets j

(183,961) (65,989) Biological Assets k

85,437 82,287

Deferred Tax l

(155,574) (300,341) Trading and coverage derivatives m

(632) 4,752

Financial liabilities n

29,077 37,089 Employee benefits o

(114,443) (111,212)

Accounts Payable p

(2.302) (888) Undercapitalized accounts q

(115,168) (115,255)

Allowances and Contingencies r

(64,541) (89,274) Customer Loyalty Programs s

(14,330) (27,233)

Other adjustments

14,360 (3,278) NCIF adjustments with an effect on equity attributable to shareholders of the Parent Company

COP (1,015,999) (1,063,002)

Balance of Equity Attributable to the Shareholders of the Parent Company under NCIF

8,881,367 11,139,795

Reclassification of noncontrolling interest under previous GAAP to equity under NCIF

3,482,437 3,857,253

Adjustments under NCIF with an effect on noncontrolling interest

55,238 (26,205) Equity balance under NCIF

COP 12,419,042 14,970,843

(Continued)

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The first-time adoption account amounted to COP 151,780 as a result of the reduction in equity due to adjustments under NCIF with an effect on equity attributable to shareholders of the Parent Company for COP 1,015,999 and the reclassification of the valuation of property, plant and equipment and investments for a total of 864,219 mainly. Income Statement

The table below shows the Group’s income statement under Previous GAAP and under the NCIF for the six-month period ended on December 31 2014:

Previous GAAP

Adjustments NCIF

Earnings from interest and valuation of debt securities

Loan portfolio interest COP 3,282,699 25,974 3,308,673

Net changes in the fair value of the financial assets 257,342 (54,770) 202,572 Interest on investments in debt securities at amortized cost 74,955 26,978 101,933

Total interest income 3,614,996 (1.818) 3,613,178 Interest expenses

Interest on deposits 1,010,492 (1,187) 1,009,305 Borrowings 214,826 165,277 380,103 Short-term borrowings with rediscount agencies 171,244 (71,883) 99,361

Total interest expenses 1,396,562 92,207 1,488,769 Net income from interest and valuation of debt securities 2,218,434 (94,025) 2,124,409

Financial Asset Impairment 563,794 50,913 614,707

Net interest income after impairment 1,654,640 (144,938) 1,509,702

Earnings from commission and other services 1,479,117 (7,117) 1,472,000 Commission expenses and expenses of other services 166,631 (21,701) 144,930

Net income from commissions and other services 1,312,486 14,584 1,327,070

Other Income 1,598,449 1,418,017 3,016,466

Other expenses 3,121,817 1,039,530 4,161,347

Earnings Before Income Tax 1,443,758 248,133 1,691,891

Income tax 466,900 151,952 618,852 Net income COP 976,858 96,181 1,073,039 Net income attributable to: Parent Company Shareholders 701,622 4,913 706,535

Noncontrolling Interest 275,236 91,268 366,504 Net income under NCIF COP 976,858 96,181 1,073,039

The table below shows the Group’s income statement under Previous GAAP and under the NCIF for the six-month period ended on June 30, 2014:

Previous GAAP Adjustments and

Reclassifications NCIF

Loan portfolio interest COP 3,001,512 37,688 3,039,200

Net changes in the fair value of the financial assets 432,000 48,277 480,277 Interest on investments in debt securities at amortized cost 54,784 10,198 64,982 Total interest income 3,488,296 96,163 3,584,459

Interest expenses Interest on deposits 898,467 (1,227) 897,240 Financial Institution Deposits (61) 0 (61) Borrowings 207,280 78,438 285,718 Short-term borrowings with rediscount agencies 158,837 (273) 158,564

Total interest expenses 1,264,523 76,938 1,341,461

(Continued)

141



Reconciliation of Income

The table below shows the Group’s reconciliation of income under Previous GAAP and under the NCIF for the semesters ended on December 31 and June 30, 2014:

Note December

31, 2014

June 30, 2014

Net income under Previous GAAP COP 701,622 686,998 Loan portfolio adjustments (Commissions received - granting costs - suspended interest - provision) 133,408 33,082

Business combination adjustment 91,666 82,658 Adjustment to deferred charges (reversion of amortization generates revenue) 80,682 48,081 Recording of investments in companies with significant influence (equity method associates and joint ventures) mainly in CORFICOLOMBIANA 61,616 (84,988)

Valuation of fixed income investments (Change from available for sale to Fair Value) (47,358) 25,746 Adjustment of property, plant and equipment (11,807) (12,934) Adjustment of liabilities for provisions (includes tax uncertainties) (36,260) (16,029) Adjustment to cost of sales of realizable assets (27,999) (31,950) Reversion of income from leaseback transaction at Promigas 0 (81,950) Adjustment of deferred charges for analysis of concession charges (33,099) (18,453) Differences between consolidated and individual financial statements according to Colombian Financial Superintendence (Transfer to OCI) (30,354) 46,253

Adjustment due to recognition and valuation of biological assets (Adjustment to fair value) (26,873) (6,005)

Adjustments of the valuation of derivatives (CVA and coverage accounting) 17,417 (2,659) Adjustment of foreclosed assets 13,830 4,760 Exchange rate adjustment of subsidiaries abroad (13,572) 109,660 Adjustment of accounts receivable impairment (12,399) (3,640) Adjustment of investments in equity securities with less than 20% interest (CORFICOLOMBIANA) 12,054 13,525

Adjustment of bonds issued at amortized cost (reversion of amortization) 10,131 0 Adjustments for customer loyalty programs (6,872) (6,032) Reversion and transfer of reconciliation items in accounts receivable (cash allowance) (6,084) 6,687



Net income from interest and valuation of debt securities 2,223,773 19,225 2,242,998

Asset Impairment Loss 417,672 6,610 424,282

Net interest income after impairment 1,806,101 12,615 1,818,716

Earnings from commission and other services 1,376,108 (11,572) 1,364,536 Commission expenses and expenses of other services 154,766 (5,588) 149,178

Net income from commissions and other services 1,221,342 (5,984) 1,215,358

Other Income 1,185,226 1,191,011 2,376,237

Other expenses 2,772,597 772,180 3,544,777

Earnings Before Income Tax 1,440,072 425,462 1,865,534

Income tax 526,589 97,753 624,342

Net income 913,483 327,709 1,241,192

Net income attributable to: Parent Company Shareholders 0 0 0 Net income from continued operations 686,998 197,929 884,927

Noncontrolling Interest COP (226,484) (129,782) (356,266)

(Continued)

142



Note December

31, 2014

June 30, 2014

Adjustment for employee benefit plans 5,288 1,006 Assets provided under operating leases under Previous GAAP transferred to loan portfolio 3,006 (2,802)

Adjustment of joint operations (2,880) (3,552) Adjustments for the impairment of property, plant and equipment assets 2,617 2,519 Adjustment due to equity tax 2,317 32,645 Adjustments made to income accrual 1,185 (8,340) Adjustment of debt issuance costs 590 (7,158) Deferred tax adjustment (174,399) (10,286) Other adjustments (10,956) (67,314) Standardization adjustments 79,882 177,344 Consolidation adjustments u (69,864) (21,945) NCIF adjustments with an effect on equity attributable to shareholders of the Parent Company (4.913) 197,929

Net income under NCIF attributable to shareholders of the parent company 706,535 884,927 Net income under NCIF attributable to noncontrolling interest 366,504 356,265 Net income under NCIF 1,073,039 1,241,192 Other comprehensive income under NCIF 165,130 (158,573) Comprehensive income under NCIF COP 1,238,169 1,082,619

The opening on account of other comprehensive income under NCIF is presented in the consolidated statement of income and Note 21. Notes to the Reconciliations The explanatory notes of the adjustments between Previous GAAP and the NCIF at January 1, 2014 and December 31, 2014 are shown below:

a. Promigas and Subsidiaries Consolidation Under previous GAAP, pursuant to Law 222 / 1995, the investment held by the Group in Promigas was not subject to consolidation, since the vehicles by which indirect interest is held did not comply with the definition of partnerships. Therefore, it was not included in the calculation of the interest in order to determine whether the consolidation was required. According to IFRS 10, the Group must prepare its financial statements including Promigas and subsidiaries as a subsidiary, as it has controlling interest in the entity, the capacity to influence the amount of variable returns on its investment and exposure to variable returns. Therefore, in the consolidated opening statement of financial position, the consolidated financial statements of Promigas and subsidiaries were consolidated through Corficolombiana.

b. Cash and Cash Equivalents According to Previous GAAP, some of the Group's companies were creating a provision for debit-type reconciliation items with more than 30 days pending standardization. Under IFRS, some of these reconciliation items were reclassified in the loan portfolio, as they corresponded to unidentified clients on the date of presentation of the financial statements and others were adjusted with impact on equity.

(Continued)

143



c. Investments Under Previous GAAP, fixed income investments were classified in three groups: “negotiable”, measured at market prices through profit or loss; “held to maturity”, measured at amortized cost calculated based on their internal rate of return and adjusted in the statement of income; and “available for sale” also measured at amortized cost calculated based on the internal rate of return and adjusted in the statement of income, while adjusted to their fair value with changes in the fair value recorded in the statement of changes in equity to the “unrealized gains” account. Investments could also be classified as trading securities or investments available for sale in the case of highly active securities. Low activity securities or those not traded on the exchange were recorded at cost and adjusted for valuations occurred following acquisition based on the share in equity increases of the entity where the investment was held. Said valuations are recorded in a separate asset account, crediting the valuation surplus account in the statement of changes in equity. In addition to the aforementioned, provisions are saved for the impairment of investments based on ratings and percentages of provisions established by the Colombian Financial Superintendence. In line with the requirements of IFRS 9 Financial Instruments, the Group classifies its investments based on their value measured at amortized cost or at fair value, recording adjustments in the statement of income on the basis of i) the entity’s business model used when managing financial assets and ii) characteristics of the financial assets contractual flows. Investments classified "at fair value with adjustments in the statement of income" are initially recorded at fair value and then adjusted for changes in fair value, by debiting or crediting the statement of income as appropriate. Investments "at amortized cost" are initially recorded in the amount of the transaction, which unless demonstrated otherwise is similar to the fair value plus transaction costs. Then taxes on yields from said credits are calculated and recorded in the statement of income. This is done using the effective interest rate method, calculated based on the internal rate of return determined from the initial record. In turn, investments in controlled entities are consolidated pursuant to the provisions of IFRS 10 "Consolidated Financial Statements". Investments in associates and joint venture are recorded using the equity method according to IAS 28 "Investments in Associates and Joint Ventures" and for investments in which there is no control or significant influence, the book value according to Previous GAAP was measured at fair value and, in some cases, at book value in view of the absence of prices on the market for said investments and considering that their possible fair value in that regard does not generate a material impact on the consolidated financial statements.

d. Joint Agreements According to IFRS 11 “Joint Arrangements”, the Group recognized its share in the assets and liabilities held in a joint operation, of the private equity of Megabanco in the Helm Bank trust company. In turn, the Group signed a joint account agreement with related parties, where ATH is the managing partner, in order to centralize fund and data transfer operations through ATMs, Internet or any other electronic medium.

(Continued)

144



Under Previous GAAP, the total value corresponding to its share was registered in the account of other assets of the total value corresponding to the share in assets, in the income accounts as applicable according to the share. As set forth by IFRS 11, it was determined that in relation to the joint account agreement, there is a joint venture, because the decisions involving relevant activities require the unanimous consent of the parties that share control and, according to contract provisions, the Bank has rights concerning the net assets and liabilities.

e. Concessions In relation to the concession agreements under the Previous GAAP, the Group recognized the costs incurred during the construction stage of the concessioned asset by recording them as deferred assets and they were later amortized during the life of the agreement using the straight-line method. The revenue received from the services provided by the asset were recorded in the period in which they were actually received or based on the accrual of the amounts guaranteed by the Government. According to IFRIC 12 "Service Concession Agreements", the rights related to concession agreements are to be recorded as financial assets or intangible assets. A financial asset is recognized when, according to the conditions of the agreement, there is an unconditional contractual right to receive from the grantor or the Colombian State, cash or another financial asset for the construction services provided. In turn, an intangible asset is recognized when there is no unconditional right in the concession agreement to receive cash, and revenue is conditioned to the degree of the public's use of the service provided by the asset under concession. In some cases, there may be mixed agreements in which one part of the agreement is a financial asset and another part is an intangible asset.

f. Loan Portfolio Transaction costs Under the regulations of the Colombian Financial Superintendence, granting or transaction costs were recorded directly in the statement of income as they are incurred. Under IFRS, the loan portfolio is measured at amortized cost and incremental transaction costs directly attributable to granting the loans are included in the calculation of the effective interest rate method. Impairment Under Previous GAAP, the loan portfolio was recorded at nominal value and impairment provisions were created based on reference models established by the Colombian Financial Superintendence for commercial and consumer loans, subject to prior credit rating by risk levels and provision percentages, which included cyclical and counter-cyclical components. In the case of mortgage and consumer loans for which the Superintendence did not establish a specific models, the loans were rated by risk levels in accordance with their age and the provision was calculated based on specific provision percentages determined by the Superintendence in accordance with the risk category plus a general provision of 1% of the total balance of said loans.

(Continued)

145



According to IAS 39 "Financial Instruments", the impairment of the loan portfolio is calculated as follows: i) for assets considered significant by the Group, based on individual assessments, analyzing the profile of each debtor, the collateral provided and information from the credit reporting bureaus. When the Group considers that the asset is impaired, the amount of the loss is measured as the present value of the expected cash flows in accordance with the debtor's conditions discounted at the originally agreed contractual rate, or as the fair value of the collateral covering the loan minus the estimated cost of sale.; ii) For assets that are not considered significant and individually significant loans that are not considered impaired on an individual analysis, the Group conducts a collective evaluation, grouping the financial asset portfolios by segments with similar characteristics, using statistical techniques based on the analysis of historical losses to determine an estimated percentage of losses incurred on said assets on the balance sheet date, and have not been identified individually. It is important to mention that according to the instructions given by the Colombian Financial Superintendence, the differences between the provisions of the loan portfolio under IFRS and Previous GAAP was recorded in Other Comprehensive Income. Operating to Financial Leases Operating lease agreements were evaluated under IAS 17 and for the financial statement of adapted IFRS, they were classified as financial leases. Therefore, leasing prepayments, assets to be placed in financial leases and the capital and interest component of the leases were transferred to the loan portfolio. As a result, and considering the instructions given by the Financial Superintendence in the Basic Accounting and Financial Bulletin, the balances were mainly classified in "A" risk categories and provisions were recorded as established in Chapter II of the Basic Accounting and Financial Bulletin. Contingent Limit Provision The provision calculated on contingencies is recorded as a provision in accordance with IAS 37. This provision included the factors used to calculate loan portfolio provisions, as well as the expected amount of use of the contingency on account of non-compliance. This evaluation was conducted for the concepts listed below: The contingent limits of credit cards, revolving credits and overdrafts that are considered loan

commitments in which the client can use the limit and make the disbursement without further approval from the bank or without Bank intervention.

Letters of credit, collateral and bank guarantees. Suspended Interest In the preparation of the consolidated opening balance sheet, the interest whose accrual was suspended under previous GAAP was included, without including the interest with no chance of recovery by debiting the loan portfolio account and the retained earnings account for first-time adoption.

(Continued)

146



g. Property, plant and equipment, and investment property Under Previous GAAP, property, plant and equipment was recorded at cost and adjusted for inflation through 2000, not including decommissioning costs, and depreciated based on useful lives of 20 years for office buildings; 10 years for machinery, equipment, furniture and appliances; and 5 years for vehicles and computer equipment without determining its residual value. In addition, the valuations of said assets were calculated based on updated appraisals in periods of no more than three years, for the difference between the appraised value and the book value of the asset. These valuations were recorded in the asset in a special account named valuations with a balancing entry in the equity account named revaluation reserve. If the appraised value was lower than the book value, the difference was recorded as a provision charged to income. According to IFRS 1, the Bank took the book value under Previous GAAP, including valuations, as the attributed cost for some land and buildings. It also held a group of assets under the cost model and made the corresponding adjustments to the values recorded under Previous GAAP consisting mainly of the elimination of valuations. This is how the Group recognizes property, plant and equipment at cost, which includes estimated decommissioning costs. Depreciation is calculated based on useful life after deducting residual value based on studies by independent experts. This was how the following useful life was established for properties by components under IFRS: foundation between 50 and 70 years, walls and divisions from 20 to 30 years, and finishes from 10 to 20 years. On the dates of preparation of the financial statements, the Group analyzes whether there are any internal or external signs that a material asset may be impaired. If there is any evidence of impairment, the entity analyzes whether said impairment really exists by comparing the net asset book value with its recoverable amount (the greater of the fair value minus the costs of owning the asset and its value in use). When the book value exceeds the recoverable amount, it is adjusted to the recoverable amount by debiting income for the period, modifying future depreciation charges to bring them in line with the new remaining useful life.

h. Noncurrent Assets Held for Sale and other items

Under previous GAAP, the Group recorded foreclosed assets as established in the single plan for accounts of the financial sector, as follows: When the assets were received, they were recorded in the foreclosed assets account in the amount agreed with debtors and any difference with the value of the debt. If the value of the assets received was greater, it was recorded as a liability in favor of the debtor or in income depending on the agreement made. If the value of the debt was lower, the balance of the debt was provisioned or charged off by debiting income. At the same time, an appraisal of the immovable property or the market value of the movable asset was obtained. If the appraised or market value was less than the value for which it was received, a provision was created by debiting income. if the appraisal was greater than the value of the asset, the difference could be recorded as a valuation in the asset by crediting revaluation reserve. Pursuant to the instructions of the Colombian Financial Superintendence, provisions were created for foreclosed assets based on the term established for the sale thereof.

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According to IFRS 5 "Noncurrent Assets Held for Sale", foreclosed assets available for immediate sale in current conditions with a high probability of sale are classified and measured as noncurrent assets held for sale. In all other cases, the BRPs were reclassified in investments, loan portfolio and property, plant and equipment or other asset account, in accordance with their nature and expected future use and measured as indicated in the applicable IFRS for each case.

i. Capital Gains

Under Previous GAAP, when an entity acquired control of another, goodwill (or capital gain under IFRS) was recorded in the amount of the difference between the value paid and the proportional net book value of the acquired entity's equity. After that, goodwill was amortized by debiting income in a 20-year period based on exponential factors established in a table defined for this purpose by the Financial Superintendence. In line with IFRS 3 "Business Combinations", a transaction or other event in which the acquiring entity obtains control of one or more businesses, is recorded in the consolidated financial statements using the purchase method. Based on this method, the acquisition price is distributed among the identifiable assets acquired, including any intangible asset and liability assumed, at their respective fair values, with some exceptions such as the deferred tax, which is measured at book value. The difference between the price paid plus the value of the noncontrolling interest, measured at fair value or the proportional value of the recognized net assets, and the net value of the assets and liabilities required, determined as indicated earlier in this paragraph, is recorded as capital gains. The impact on adoption is due to the recognition of the amortization of goodwill in BBVA Horizonte from the date of acquisition in April 2013 for COP 1585 by debiting equity. The resulting book value of goodwill at December 31, 2013 was taken as attributed cost of capital gain at January 1, 2014 in accordance with the exemption allowed under IFRS 1.

j. Deferred charges and other assets The equity tax established according to the tax provisions of previous years and other concepts of deferred charges and prepaid expenses (including renovations, software maintenance, stationery, advertising, contributions and memberships) were recorded according to Previous GAAP as deferred assets for gradual amortization charged to the statement of income. However, according to IFRS, said transactions do not meet the requirements to be recognized as assets of the Conceptual Framework and IAS 38 Intangibles; therefore, the balances pending amortization under Previous GAAP at January 1, 2014 were retired and debited to equity.

It was also determined that some of the inventories held by the Group under Previous GAAP do not meet the requirements to be treated as assets according to the parameters set forth in the IFRS. In addition, inventories were adjusted for the effects of measurement between cost and fair value, whichever was lower.

k. Biological Assets Under Previous GAAP, the costs incurred in the production of short-term agricultural assets were recorded as inventory and the costs incurred in medium or long-term crops were recorded as property and equipment or deferred charges and later amortized using the straight-line method over the economic life of the crop.

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According to the requirements of IAS 41 "Agriculture", biological assets and agricultural products are to be measured at fair value minus costs of sale, if they can be measured reliably. Therefore, rubber (Pajonales - Mavalle) and African palm (Unipalma) were measured at fair value minus cost of disposal in the opening statement of financial position.

l. Deferred Tax

Under Previous GAAP, the Bank and subsidiaries calculated and recorded deferred tax using the method based on the income statement, which consisted of determining the temporary differences arising between income before taxes and income after taxes. According to IAS 12 "Income Taxes", the deferred tax is calculated using the liability method, which consists of determining temporary differences arising from the comparison between the book value of assets and liabilities and their tax bases. Temporary differences can lead to taxable or deductible amounts, respectively, when establishing the corresponding tax gains (losses) for future periods when the asset’s carrying value is recovered or the liability is settled.

m. Derivatives and coverage The Group uses the market approach and the income approach to establish the fair value of its derivatives due to the common use of these methods among market players. The difference in valuation identified between Previous GAAP and the IFRS increased to a net value of COP 632, due to the incorporation of credit risk into the valuation (CVA or DVA). The incorporation of credit risk into the valuation methodology of the derivatives according to the requirements of IFRS 13 "Fair Value," was carried out under the premise of effect of the discount rate, forming groups or sets within the derivative portfolio according to the currency of the instrument and the accounting nature of its valuation (asset or liability).

n. Financial liabilities Under Previous GAAP, obligations for bonds issued abroad in 2011 and 2013 (ordinary and subordinated bonds, respectively) were recorded as outstanding investment securities and the transaction costs were recognized as deferred charges. In accordance with IAS 39 “Financial Instruments”, financial liabilities are measured at amortized cost using the effective interest method. In order to calculate the effective interest rate, the cash flows are estimated taking into account all the contract conditions of the financial instrument (for example, prepayments, bailouts and purchase options or similar), and they include commission and interest points paid or received by the contract parties, which integrate the effective interest rate, as well as the transaction costs and any other bonus or discount. As a result of the application of IAS 39 "Financial Instruments", the Group adjusted the value of its financial instrument for the transaction costs recognized as a lower value of borrowings.

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o. Employee Benefits

Under Previous GAAP, the accounting treatment of seniority bonuses, retirement pensions and other long-term benefits was as follows:

i. Seniority bonuses and withdrawal bonds: They were recognized in the statement of income when the employees received the benefit, after meeting the applicable requirements according to the applicable legal provisions and labor agreements.

ii. Retirement pensions: The retirement pension benefit for employees whose pension is directly assumed

by the Group (defined benefit plans) was calculated based on actuarial studies, prepared according to the mortality tables issued by the Colombian Financial Superintendence, and average FTD interest rates of the last 10 years, and provisions were recognized gradually by debiting income of the period that, for the balance pending provisioning at December 31, 2010, established a term up to the year 2029.

iii. Retroactive severance pay: For certain employees covered under the labor system prior to Law 50 /

1990, a provision was recognized for the severance pay benefit based on the current salary at December 31 of each year, or the average if there was a change in the last 90 days, multiplied by the number of years of service.

Under NCIF, the Bank and subsidiaries calculated these long-term liabilities according to IAS 19 by carrying out actuarial studies, applying the method of the forecast credit unit, which consists of establishing the future obligation discounted from its present value and the allocation of the service costs proportional to the time of service provided.

p. Accounts Payable The accounting regulations of several subsidiaries of Leasing Bogotá Panamá abroad establish that the guarantor is bound to recognize a liability at the beginning of the guarantee in the amount of the fair value of the obligation assumed by issuing the guarantee. This issuance involves the guarantor's obligation of being willing to pay, during the term of the guarantee, in the event of client default.

q. Undercapitalized Accounts in the Porvenir subsidiary Under IFRS, an estimated liability was recognized at January 1, 2014, in equity on that date, as a result of the measurement of provisions for undercapitalized accounts. Under Previous GAAP, these expenses were recognized when they were paid. The estimate for undercapitalized accounts is the amount estimated by Porvenir on certain individual planned retirement accounts to ensure at least one monthly pension payment of a minimum monthly salary.

r. Allowances and Contingencies On January 1, 2014, the Group recognized provisions by debiting equity for tax positions and to cover the proportional expenses related to the correction of the income tax return for 2013 filed during the first half of 2015.

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s. Customer Loyalty Programs As part of their activities, the companies of the Group have established customer loyalty programs in which points are awarded to be cashed in for prizes once the requirements established in the programs are met. Under Previous GAAP, redeeming of the prizes was recognized as an expense in the statement of income when the points were cashed in. In accordance with IFRIC 13 “Customer Loyalty Programs,” the credit/prizes awarded are separately identifiable components of the sale transaction that generates them and they are recognized as deferred income at the fair value of each credit/prize awarded to be recognized in the statement of income at the time the credit/prizes are redeemed.

Reconciliation of Cash Flow The following is the reconciliation of the Group's cash flows according to previous GAAP and according to the NCIF for the semester ended on December 31, 2014. Semester Ended December 31, 2014



Net cash (used in) provided by operating activities COP (938,035) 1,770,585 832,550 Net cash used in investment activities 241,359 (1,254,319) (1,012,960) Net cash from financing activities 2,513,070 (2,304,714) 208,356 Net increase in cash and cash equivalents

Effect of exchange rate difference on cash and cash equivalents 0

1,570,350

1,570,350 Net decrease in cash and cash equivalents 1,816,394

(218,098)

1,598,296

Cash and cash equivalents at start of the period 12,564,278 (561,646) 12,002,632 Cash and cash equivalents at end of the period COP 14,380,672 (779,744) 13,600,928

The main variations between the cash flows previously reported according to Previous GAAP and cash flows according to the NCIF of the semester ending on December 31, 2014 are due to:

1. The cash flows from operating, investment and financing activities under NCIF include the flows from

the consolidation of Promigas and subsidiaries through Corficolombiana, as indicated in explanation (a). of the notes to the reconciliations.

2. The exchange difference of the bonds issued and borrowings under previous GAAP were presented

in the financing activities and in accordance with IAS 7, they were presented in operating activities.

3. The effects of the exchange difference on cash and cash equivalents were presented in a separate category in accordance with the requirements of IAS 7.

35. Related Parties

Related parties are considered to be:

1) A related party is an individual or entity that is related with one of the Group's entities through transactions such as the transfer of resources, service or obligations, regardless of whether or not a price is placed on said transactions.

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To the Group, all economic activities carried out with shareholders and entities of Grupo Aval are considered transactions between related parties.

2) Stockholders who individually own more than 10% of the Bank's capital stock and those with an individual share lower than this percentage but regarding which there are transactions that exceed 5% of the technical equity. Stockholders with more than 10% of the share:

- Grupo Aval Acciones y Valores S.A. Stockholders with less than 10% of the capital stock, but with transactions that exceed 5% of technical equity: - At June 30, 2015, and December 31, 2014, the Bank did not present transactions that would exceed

5% of the Bank's technical equity among stockholders with a share of less than 10%.

3) Key management personnel: This includes the president and vice-presidents, who are people who participate in the Group's planning, management and control.

4) Subordinate Entities: Where the Bank exercises control.

5) Other non-subordinate related entities

Transactions with Related Parties: The Bank shall be able to conduct transactions, agreements or contracts with related parties, with the understanding that any of said transactions shall be realized at fair value responding to the market conditions and rates. Between the Bank and its related parties during the periods ending at December 31, 2014 and June 30, 2015, there were no: • Loans that involve a liability for the borrower that does not correspond to the essence or nature of the

loan agreement. • Loans with interest rates different to those that are normally paid or charged to third parties in similar

conditions of term, risk, etc. • Operations with different characteristics to those carried out with third parties. According to the Agreement Manual of Banco de Bogotá S.A. in Chapter VI “Special Agreements with Affiliates for Use of the Bank's Network”; Banco de Bogotá S.A. has agreements for the use of the office network with Fiduciaria Bogotá S.A. and Porvenir S.A. In the case of the trust company (Fiduciaria Bogotá S.A.), the Colombian Government authorized the trust companies to use the Bank's office network. For this purpose, Fiduciaria Bogotá S.A. signed a contract with Banco de Bogotá S.A., by virtue of which, the trust company may use the Bank's network of offices for its operations. The contract defines the operating management of transactions of the customers of the mutual funds managed by Fiduciaria Bogotá S.A.

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In accordance with the legal provisions of Law 50 / 1990 (Labor Reform Act) and Law 100 / 993 (General and Comprehensive Social Security System Act), the Bank made an agreement with Sociedad Administradora de Fondos de Pensiones y Cesantías Porvenir S.A., by means of which it makes its offices available as a support network for services related to the mandatory pension and severance pay funds. During the semesters ending at June 30, 2015 and December 31, 2014, fees were paid to the directors in the amount of COP 1,319 and COP 1,270, respectively, for their attendance at board and committee meetings. At June 30, 2015 and December 31, 2014, the Bank recorded the following balances of the loan portfolio and deposits with companies related to the Bank's directors and administrators:

June 30, 2015

December 31, 2014

January 01,

2014

Loan portfolio and finance lease transactions COP 467,245 471,646 286,192 Financial Liabilities at Amortized Cost COP 64,375 29,746 23,071

All transactions were made at market prices. The average rate of loans that the Group awarded to its related parties is equivalent to FTD+3.45. The credit card and overdraft operations are made at the products' full rates. The grouping of balances and operations with related parties is shown below, including the details of transactions with key management personnel:

June 30, 2015

Related Entities

Economically

Associates Grupo Aval

Key Management Personnel

Non-subordinated Subsidiaries

ASSETS Cash and Cash Equivalents 0 0 0 8 9,465

Investments in subsidiaries, associates and joint ventures 0 58,279 0 1,415 12,514,637

Investment Allowance 0 0 0 0 1,007 Loan portfolio and finance lease transactions 378,454 130,103 18,394 4,236 180,053

Other accounts receivable 1,281 87,943 221 122 31,558 Trading derivatives 0 10,174 0 0 63 Financial Investment Assets 0 0 0 0 160 Other Assets 1,235 0 0 0 0

LIABILITIES Financial Liabilities at Amortized Cost 154,275 3,525,657 13,165 3,399 390,586 Coverage derivatives 0 2,002 0 0 0 Accounts payable and other liabilities 3,228 150,783 204 5,804 5,300

INCOME Interest 12,424 2,889 634 0 6,955 Commission and other services 1,423 121 0 41 3,944 Other Income 278 128,510 14 1,292 230,102

EXPENSES Financial costs 1,472 52,805 158 37 3,722 Commission expenses and expenses of other services

0 0 0 53 1,137

Other expenses

4,198 139,987 9,505 4,516 47,337

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December 31, 2014

Related Entities

Economically


Key Management

Personnel Non-

subordinated Subsidiaries

ASSETS Cash and Cash Equivalents

0 0 0 144 14,314 Investments in subsidiaries, associates and joint ventures

0 45,423 0 1,415 11,404,173

Investment Allowance

0 0 0 0 927 Loan portfolio and finance lease transactions

374,155 11 23,699 672 177,232 Other accounts receivable

3,835 101,040 3 236 91,694


0 19 0 0 14,364 Other Assets

1,372 0 131 0 0

LIABILITIES Financial Liabilities at Amortized Cost

102,476 3,287,735 9,246 3,745 153,924 Coverage derivatives

0 12,166 0 0 0


2,829 158,759 54 4,983 4,179 INCOME

Interest

14,040 4,449 943 537 8,953 Commission and other services

892 111 6 23 3,377

Other Income

5 101,587 6 313 533,977 EXPENSES

Financial costs

1,824 55,518 116 65 7,353 Commission expenses and expenses of other services

0 0 0 99 1,418

Other expenses

6,737 70,667 8,105 4,509 51,038

January 01, 2014

Related Entities

Economically


Key Management

Personnel Non-

subordinated Subsidiaries

ASSETS Cash and Cash Equivalents

0 0 0 48 13,061 Investments in subsidiaries, associates and joint ventures

0 37,622 0 1,350 9,260,671

Investment Allowance

0 0 0 0 747

Loan portfolio and finance lease transactions

569,268 11 6,527 737 173,739


0 1,126 0 0 0


10,717 126,589 42 719 41,199

Other Assets

7,497 0 2 0 0

LIABILITIES

Financial Liabilities at Amortized Cost

185,207 1,784,995 1,521 8,616 658,570

Coverage derivatives

0 6,729 0 0 37,214


967 131,978 85 6,570 4,229

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Transactions with Key Management Personnel

Key management personnel is comprised of those persons who have the authority and responsibility to directly or indirectly plan, manage and control the entity's activities, including any director or administrator (whether executive or not) of this entity. Transactions of key management personnel during the semesters ending at June 30, 2015, and December 31, 2014, are comprised of:

June 30, 2015

December 31, 2014

Short-term employment benefits COP 35,007 29,832 Payment of key management personnel, and other long-term employee benefits 475 739 Termination benefits

9 15

Remuneration of Key Management Personnel

9,426 9,257

COP 44,917 39,843

36. Capital Management

The Bank's objectives in terms of the proper management of its capital are aimed at: a) complying with the capital requirements established by the Colombian government for the Bank and subsidiary financial entities of the Bank in Colombia and by the governments abroad where the Bank has financial subsidiaries; and b) maintaining an adequate equity structure that allows the Group to generate value for its shareholders. In Colombia, there are specific capital requirements applicable to the economic activity of each of the financial entities. In the case of credit institutions in Colombia (Banks, Financial Institutions and Financing Companies), the total capital adequacy ratio, defined as the ratio between technical equity and assets weighted by risk level, cannot be lower than nine point zero percent (9.0%). Also, the basic capital adequacy ratio, defined as the ratio between basic ordinary equity and assets weighted by risk level, cannot be lower than four point five percent (4.5%), pursuant to Articles 2.1.1.1.2 and 2.1.1.1.3, respectively, of Decree 2555 / 2010, amended by Decree 1771 / 2012 and Decree 1648 / 2014, regulated by External Bulletin 039 / 2014 and 006 / 2015 issued by the Colombian Financial Superintendence. The principles set forth by the Banking Association of Panama apply in the case of BAC Credomatic (capital adequacy ratio of at least 8%). For capital management purposes in Colombia, basic ordinary equity is made up mainly of subscribed and paid-in common shares, surplus from additional paid-in capital and the legal reserve for the appropriation of income. In turn, technical equity, in addition to the basic ordinary equity, takes into account unrealized gains in equity securities, subordinated bonds, temporary reserves and part of the net income, in accordance with the commitment approved by the General Meeting of Shareholders for the appropriation of a legal reserve from the net income.

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During the six-month periods ended on June 30, 2015 and December 31, 2014, the Group has successfully met the capital requirements, the level of the individual and consolidated financial statements for purposes of solvency, prepared according to the instructions of the Financial Superintendence applicable to the Group. The following is the breakdown of the capital requirements of the financial subsidiaries that make up the Group at June 30, 2015 and December 31, 2014:

Entity Total Requirement June 30, 2015 December 31,

2014 Banco de Bogotá Individual 9% 18.41%(1) 19.14% BAC International Bank Consolidated 8% 13.64% 12.55% Corficolombiana Consolidated 9% 28.37% 25.45% Corficolombiana Individual 9% 29.50% 27.93% Porvenir 9% 19.96% 28.73% Fidubogotá 9% 21.54% 24.22% Casa de Bolsa 9% 49.79% 45.19% Almaviva 36 times (2) 14.92 times 18.28 times Banco Bogotá Consolidated 9% 10.95% 11.51%

(1) Calculated based on retransmitted separate financial statements. (2) In the case of Almaviva, the capital requirement is measured as the maximum storage capacity, which cannot exceed 36 times

the technical reserves.

The Bank's management is constantly focused on maintaining the proper equity structure aimed at generating value for shareholders. In order to do so, the Bank monitors strategic management ratios on an ongoing basis, such as ROE, ROA, efficiency, net interest margin, credit rating, etc.

37. Statutory Controls

Statutory controls are the regulations established by the Colombian Financial Superintendence for credit institutions (Banks, Financial Institutions and Financing Companies) in relation with reserves (see Note 6. paragraph (e) Liquidity Risk), proprietary position (see Note 6. paragraph (d) Individual Analysis of the Risks), solvency ratio (see Note 35) and mandatory investment, which must be made in securities issued by Fondo para el Financiamiento del Sector Agropecuario (FINAGRO, for the Spanish original). During the semesters ended on June 30, 2015 and December 31, 2014, the Bank met these requirements.

38. Subsequent Events No events that require disclosure have occurred after the reporting periods corresponding to the semesters ending at June 30, 2015 and December 31, 2014, at the date of authorization of these financial statements.

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Documents

Notes to the Financial Statements Banco de Bogotá and ......2 BANCO DE BOGOTÁ S.A. AND SUBSIDIARIES Notes to the Consolidated Financial Statements Name of Subsidiary Main Activity