GRUPO SURA 2025-2028: FROM CONGLOMERATE TO FINANCIAL 'PURE PLAY' AND THE POST-FRAMEWORK AGREEMENT VALUE THESIS.

 

Grupo de Inversiones Suramericana, recognized in global markets under the Grupo SURA brand, has established itself as one of the most influential and decisive financial institutions in Latin America's economic architecture. Over the past eight decades, this organization has evolved from its origins as a local insurance company in Medellín to achieve a leading regional position as a cutting-edge investment manager, with a specialized technical focus on financial services. Its relevance is not limited to its profit-generating capacity; it also represents a model of corporate governance and a vision of sustainability that has served as a benchmark for capital markets in the region's emerging economies.

Grupo SURA is currently defined as the holding company that heads the SURA-Bancolombia financial conglomerate, a robust structure operating in eleven Latin American countries. Its strategic focus is exclusively dedicated to financial services, encompassing critical sectors such as insurance, pensions, savings, investment, asset management, and universal banking. Representing a pillar of regional financial stability, the organization manages assets exceeding COP 800 trillion by the end of 2025, a figure capable of directly influencing the dynamism of local securities markets and the mobilization of capital toward productive development.

The organization's identity is based on principles of equity, respect, responsibility, and transparency, which These are not mere ethical statements, but rather the operational foundation of its corporate culture. These values ​​have allowed Grupo SURA to be perceived by institutional and minority investors as a company that integrates the generation of economic value with the harmonious development of society. In the Colombian context, Grupo SURA symbolizes the resilience of Antioquian entrepreneurs and their capacity for transnational expansion, maintaining a genuine commitment to public value and long-term sustainability.

The history of Grupo SURA is a narrative of adaptation and long-term vision that began on December 12, 1944, in Medellín, Colombia. Originally founded as Compañía Suramericana de Seguros, the company's initial mission was to close the gap in the general insurance market in a country beginning its industrialization process. In 1947, the company ventured into life insurance, laying the foundations for what is now its South American subsidiary. During the second half of the 20th century, the company played a leading role in the creation of key institutions for the Colombian economy. In 1945, it actively participated in the establishment of Banco Industrial Colombiano (BIC), which, after several mergers and acquisitions—including the purchase of Banco de Colombia in 1997—became Bancolombia, the country's leading financial institution. The 1970s and 1980s were marked by strategic diversification into capitalization, financing, and leasing, leading to the creation of entities such as Subcapitalización and Suleasing, which strengthened the national financial ecosystem.

In 1997, a fundamental structural milestone occurred: the separation of the investment portfolio from the operational insurance business. This move formally gave rise to what we know today as Grupo SURA (then Compañía de Inversiones Suramericana) and allowed for more efficient capital management by separating the operational risk of the insurance business from the investment risk of the holding company.

The 21st century brought with it the consolidation of SURA as a regional player. In 2001, the alliance with Munich Re, which acquired a minority stake in South America, validated the company's technical standards globally. However, the most significant qualitative leap occurred in 2011, when Grupo SURA acquired ING's assets in Latin America. This transaction, one of the largest ever undertaken by a Colombian company, allowed entry into the pension and investment fund markets in five countries, thus giving rise to SURA Asset Management. In 2015, internationalization deepened with the purchase of the assets of the British insurer RSA in the region, expanding Seguros SURA's presence to countries such as Mexico, Chile, Uruguay, Brazil, and Argentina. These acquisitions transformed the group into a regional investment platform, capable of capturing the economic growth of the various Latin American countries and diversifying the sovereign risk of its operations.

To understand what Grupo SURA represents today, it is imperative to analyze the reconfiguration process of its ownership structure initiated at the end of 2021. Historically, SURA was part of a system of cross-shareholdings with Grupo Argos and Grupo Nutresa, informally known as the Grupo Empresarial Antioquia (GEA). This model, although successful for decades in protecting companies from hostile takeovers and fostering a long-term vision, presented valuation challenges for investors, as share prices often included a discount due to the complexity of the structure.

The emergence of the Gilinski Group through a series of hostile takeover bids (OPAs) between 2021 and 2022 highlighted the need to evolve the corporate structure. After a period of intense volatility and litigation, in June 2023 the "Framework Agreement" (or Madrid Agreement) was signed, a share exchange process designed to simplify company ownership. The agreement stipulated that Grupo SURA and Grupo Argos would cease to be shareholders in the food business (Nutresa), in exchange for Gilinski and IHC (International Holding Company) investors surrendering their shares in Grupo SURA. The execution of this agreement was completed in July 2025, marking the end of cross-shareholdings and the full specialization of Grupo SURA in financial services. As a result of this process, the "Portfolio Company" was liquidated, and the shares were distributed directly to minority shareholders, who now hold a cleaner and more direct stake in the financial holding company. For the market, this represents an evolution toward a more transparent and easily valued structure, eliminating the noise from other industrial sectors and allowing management to focus exclusively on optimizing the return on tangible equity of its financial subsidiaries.

Grupo SURA's strength lies in the diversification and leadership of its three main strategic units: Suramericana, SURA Asset Management, and its stake in Bancolombia. Each of these entities operates in distinct but complementary economic cycles, providing enviable income stability for the holding company.

Suramericana is the subsidiary specializing in the insurance industry, positioned as the third largest Latin American insurer by premiums issued in the region. It operates in nine countries, delivering solutions in general, life, and health insurance. In 2024, Seguros SURA generated COP 10 trillion in premiums issued, standing out for an 18% growth in health and business risk policies, demonstrating its ability to respond to the changing needs of the post-pandemic market.

A critical aspect of recent management in South America has been the voluntary withdrawal process from the Colombian health system through EPS SURA. This strategic decision was made to protect the organization's capital in the face of chronic financial deficiencies in the national healthcare system, allowing the subsidiary to concentrate on its voluntary insurance and supplemental plan lines, where profit margins are higher and more sustainable.

SURA Asset Management is the regional leader in the pension industry and a robust investment platform for institutional and individual clients. By the end of 2025, assets under management had already exceeded COP 800 trillion, with annual growth of 15.6%. This unit has been the driving force behind the group's return on equity, achieving net income of COP 1.08 trillion as of September 2025, an increase of 24.4% compared to the previous year.

The strategy of this unit has diversified beyond mandatory pensions, positioning SURA Investments as a regional asset management platform that captures the voluntary savings of the growing middle class in Mexico, Chile, Peru, and Colombia. Despite the challenges posed by pension reforms in the region, operational scale and portfolio management efficiency allow SURA AM to maintain outstanding tangible returns.

Although Grupo SURA does not exercise direct control, its 24.5% stake in Bancolombia is one of its most valuable investments. Bancolombia is the leading bank in Colombia and has a dominant presence in Central America through Banistmo (Panama), Banco Agrícola (El Salvador), and BAM (Guatemala). As of September 2025, this stake reported accumulated net income of COP 5.7 trillion for the group, a 23.2% increase compared to 2024, driven by improved portfolio quality and control of credit costs. The stock market performance of Grupo SURA over the past twelve months has been one of the most remarkable success stories on the Colombian Stock Exchange (BVC). After years of trading at significant discounts due to uncertainty surrounding the economic downturn and regulatory tensions, the company's shares have experienced a rally in value driven by record financial results and corporate simplification.

As of the close of December 2025, the common stock was trading at COP 55,160, while the preferred stock was around COP 44,000. Over the past year, the cumulative growth of the common stock was 84%, and that of the preferred stock reached an impressive [missing value] 134%. This performance has led to a drastic narrowing of the spread between the two stocks, falling below 10% on several trading days, indicating a normalization in the market's perception of value.

Despite these gains, valuation metrics suggest that the shares are still trading at a significant discount to their book value, approximately between 0.44x and 0.46x. This discount is partly attributed to Colombia's country risk premium and uncertainty surrounding the government's structural reforms, but it represents a value opportunity for long-term investors who are confident in the subsidiaries' cash flow generation capabilities.

A key factor in the recent performance of the shares has been their inclusion in international stock market indices. The preferred stock was added to the MSCI Global Small Cap, which has significantly increased its liquidity and attracted inflows of passive institutional funds. Furthermore, the company has strengthened its presence in sustainability indices such as the FTSE4GOOD, ensuring that its shares are included in global portfolios with environmental, social, and governance (ESG) criteria.

The decision to invest in Grupo SURA should be based on an investment thesis that combines dividend yield, the potential for appreciation through closing gaps, and the strength of operating cash flow. For many analysts, Grupo SURA is currently an "exciting" option for several strategic reasons.

One of the main incentives for investors is the organization's dividend policy. The Shareholders' Meeting declared a dividend of COP 1,500 per share for 2025, representing a 7.1% increase over the previous year. Analyzing the 2019-2025 period, the dividend has grown at a compound annual growth rate of 18.2%, significantly exceeding accumulated inflation in Colombia. The group's goal is even more ambitious: it aims to double the dividend payout by 2028, reaching COP 3,000 per share. This predictable cash flow makes the stock an attractive asset for income-focused equity portfolios.

The 2025 financial results have been extraordinary. With accumulated net income of COP 2.5 trillion as of September, the company has surpassed all initial projections. The adjusted return on equity (ROE) closed at 13.8% for the last twelve months, showing a steady growth path towards the strategic target of between 14% and 16%. This profitability is driven by efficient management of tangible assets, where the Return on Tangible Equity (ROE) reaches levels above 24%, standing out against the average for the financial sector in Latin America.

Although the share price has risen significantly, the fact that it is still trading below its fundamental value (fair value estimated by analysts at COP 59,100 - 63,000) suggests that there is still room for appreciation. The reduction in the number of shares outstanding after the spin-off means that each remaining shareholder now has a larger "slice" of a company that is generating record profits, which in finance Corporate performance is an unequivocal sign of value for investors.

All investments carry risks, and Grupo SURA is no stranger to the volatility of the Latin American environment. Investors must consider these factors before making a decision.

The main source of uncertainty lies in the structural reforms of the Colombian government. The pension reform, for example, alters the dynamics of resource acquisition by pension fund administrators (AFPs) such as Protección (a subsidiary of SURA AM), reducing the net flow of mandatory contributions in certain pillars. Although SURA has diversified its model towards voluntary savings and regional asset management, the operational transition to the new system could generate volatility in this unit's earnings in the short term.

Likewise, the 2026 electoral cycle in Colombia will add a layer of uncertainty to the capital market. An environment perceived as hostile to private enterprise could raise the risk premium and temporarily affect the share price, despite good operating results. Although Grupo SURA has demonstrated prudent debt management, the holding company's leverage reached COP 7.1 trillion in 2024 due to consolidation transactions. The net debt-to-dividends ratio is close to 4.0x, a level closely monitored by rating agencies. While the company projects organic debt reduction of between USD 100 million and USD 150 million annually through cash flow, any significant decline in dividends received from its international subsidiaries could put pressure on its credit rating.

Despite the voluntary withdrawal of EPS SURA, the management of remaining liabilities and potential legal contingencies arising from the Colombian healthcare system continue to be a focus for the company's legal department. However, the financial statements for the third quarter of 2025 show that these risks are adequately provisioned and should not compromise the stability of the financial holding company

The Suramericana Investment Group represents an institution that has successfully transformed a governance crisis and an outdated ownership structure into an opportunity for modernization and strategic focus. By consolidating itself as a "pure play" financial services provider, the organization has paved the way for the market to appreciate its true wealth-generating capacity

From a historical perspective, the group's performance demonstrates exceptional resilience and capital discipline that has rewarded loyal shareholders with increasing dividends and intelligent geographic expansion. Currently, SURA shares offer an attractive combination of value (due to their discount relative to book value) and growth (due to the regional expansion of SURA Asset Management and Bancolombia). For a sophisticated investor, Grupo SURA is a key player in gaining exposure to the Latin American financial sector. While regulatory risks in Colombia are real, the company's diversification in markets like Mexico and Chile, coupled with its undisputed leadership in the region, acts as a natural mitigator. In conclusion, investing in Grupo SURA in 2025 and looking ahead to 2028 is a bet on a solid, ethically responsible, and Financially robust, SURA is headed for a period of record profitability and regional consolidation.

SURA's thesis, which matures over a 3- to 5-year horizon aligned with its 2028 goals, underscores the importance of closely monitoring the implementation of pension reform and the outcome of the healthcare system in Colombia. The dividend yield on its preferred stock remains among the most competitive in the MSCI Colcap. Its continued inclusion in sustainability indices guarantees a management standard that reduces governance and reputational risk.