NOTE 13 PROPERTY, PLANT AND EQUIPMENT
a) Property, plant and equipment as of December 31, 2017 and 2016 were as follows:
| Useful life | Remaining depreciation | Net Balance as of January 1, 2017 |
Gross Balance |
Accumulated depreciation |
Net Balance | ||||||||
| Item | years | years | MCh$ | MCh$ | MCh$ | MCh$ | |||||||
| Land and building | 25 | 16 | 78,034 | 118,481 | (35,330 | ) | 83,151 | ||||||
| Equipment | 5 | 1 | 25,997 | 65,018 | (39,858 | ) | 25,160 | ||||||
| Other | 8 | 3 | 17,012 | 50,773 | (28,505 | ) | 22,268 | ||||||
| - Furniture | 8,418 | 27,860 | (17,503 | ) | 10,357 | ||||||||
| - Leasing assets | 50 | 28 | (28 | ) | — | ||||||||
| - Others | 8,544 | 22,885 | (10,974 | ) | 11,911 | ||||||||
| Total | 121,043 | 234,272 | (103,693 | ) | 130,579 |
| Useful life | Remaining depreciation | Net Balance as of January 1, 2016 |
Gross Balance |
Accumulated depreciation |
Net Balance | ||||||||
| Item | years | years | MCh$ | MCh$ | MCh$ | MCh$ | |||||||
| Land and building | 25 | 17 | 16,778 | 107,989 | (29,955 | ) | 78,034 | ||||||
| Equipment | 5 | 2 | 6,724 | 62,007 | (36,010 | ) | 25,997 | ||||||
| Other | 8 | 4 | 10,468 | 42,726 | (25,714 | ) | 17,012 | ||||||
| - Furniture | 1,011 | 26,513 | (18,095 | ) | 8,418 | ||||||||
| - Leasing assets | — | 338 | (288 | ) | 50 | ||||||||
| - Others | 9,457 | 15,875 | (7,331 | ) | 8,544 | ||||||||
| Total | 33,970 | 212,722 | (91,679 | ) | 121,043 |
The useful lives have been determined based on our expected use considering the quality of the original construction, the environment in which the assets are located, the quality and degree of maintenance carried out, and appraisals performed by external specialists who are independent of the Bank that have been taken into consideration by management to determine the useful lives of our buildings.
b) The movement of property, plant and equipment for the periods ended December 31, 2017 and 2016:
| Landing and Building |
Equipment | Other | Total | ||||||
| MCh$ | MCh$ | MCh$ | MCh$ | ||||||
| Balances as of January 1, 2017 | 107,989 | 62,007 | 42,726 | 212,722 | |||||
| Purchases | 27,125 | 7,853 | 9,274 | 44,252 | |||||
| Sales/Retirements | (12,636 | ) | (2,241 | ) | (952 | ) | (15,829 | ) | |
| Exchange differences | (3,997 | ) | (2,601 | ) | (275 | ) | (6,873 | ) | |
| Balances as of December 31, 2017 | 118,481 | 65,018 | 50,773 | 234,272 |
| Landing and Building |
Equipment | Other | Total | ||||||
| MCh$ | MCh$ | MCh$ | MCh$ | ||||||
| Balances as of January 1, 2016 | 18,808 | 15,876 | 31,533 | 66,217 | |||||
| Integration Itaú Corpbanca | 75,797 | 42,354 | 21,629 | 139,780 | |||||
| Purchases | 11,002 | 7,091 | 5,306 | 23,399 | |||||
| Sales/Retirements | (13,206 | ) | (3,423 | ) | (283 | ) | (16,912 | ) | |
| Exchange differences | 170 | 110 | 29 | 309 | |||||
| Others | 15,418 | (1 | ) | (15,488 | ) | (71 | ) | ||
| Balances as of December 31, 2016 | 107,989 | 62,007 | 42,726 | 212,722 |
c) Movements of accumulated depreciation of property, plant and equipment as of December 31, 2017 and 2016, are detailed as follows:
| Landing and Building |
Equipment | Other | Total | ||||||
| MCh$ | MCh$ | MCh$ | MCh$ | ||||||
| Balances as of January 1, 2017 | (29,955 | ) | (36,010 | ) | (25,714 | ) | (91,679 | ) | |
| Depreciation | (7,218 | ) | (8,054 | ) | (4,098 | ) | (19,370 | ) | |
| Sales and retirements | — | 2,178 | 481 | 2,659 | |||||
| Exchange Differences | 1,843 | 2,055 | 826 | 4,724 | |||||
| Impairment (Note 30) | — | (27 | ) | — | (27 | ) | |||
| Balances as of December 31, 2017 | (35,330 | ) | (39,858 | ) | (28,505 | ) | (103,693 | ) |
| Landing and Building |
Equipment | Other | Total | ||||||
| MCh$ | MCh$ | MCh$ | MCh$ | ||||||
| Balances as of January 1, 2016 | (2,030 | ) | (9,152 | ) | (21,065 | ) | (32,247 | ) | |
| Integration Itaú Corpbanca | (13,855 | ) | (24,500 | ) | (11,210 | ) | (49,565 | ) | |
| Depreciation | (5,047 | ) | (5,281 | ) | (3,506 | ) | (13,834 | ) | |
| Sales and retirements | 732 | 3,006 | 259 | 3,997 | |||||
| Exchange Differences | (52 | ) | (84 | ) | (38 | ) | (174 | ) | |
| Impairment (Note 30) | — | (351 | ) | — | (351 | ) | |||
| Others | (9,703 | ) | 352 | 9,846 | 495 | ||||
| Balances as of December 31, 2016 | (29,955 | ) | (36,010 | ) | (25,714 | ) | (91,679 | ) |
d) As of December 31, 2017 and 2016, the Bank held operating lease contracts that cannot be unilaterally terminated. The future payment information is detailed as follows:
Future Operating Lease Payments Land, Buildings and Equipment
| Up to one year |
From one to five years |
Over five years |
Total | ||||||
| MCh$ | MCh$ | MCh$ | MCh$ | ||||||
| As of December 31, 2017 | 23,021 | 76,949 | 103,195 | 203,165 | |||||
| As of December 31, 2016 | 24,599 | 100,482 | 15,900 | 140,981 |
e) As of December 31, 2017 and 2016, the Bank held finance lease contracts that cannot be rescinded or unilaterally terminated. The future payment information is detailed as follows:
Future Financial Leasing Payments Land, Buildings and Equipment
| Up to one year |
From one to five years |
Over five years |
Total | ||||||
| MCh$ | MCh$ | MCh$ | MCh$ | ||||||
| As of December 31, 2017 | 9,078 | 43,730 | 43,730 | 96,538 | |||||
| As of December 31, 2016 | 46,540 | 189,623 | 47,406 | 283,569 |
f) As of December 31, 2017 and 2016, the Bank and its subsidiaries had no restrictions on property, plant and equipment. In addition, no property, plant and equipment had been given in guarantee for compliance of any obligations. There are also no amounts owed by the Bank on property, plant and equipment as of the aforementioned dates.