BOGOTA -(Dow Jones)- Colombia's financial institutions posted a combined net profit of 2.10 trillion Colombian pesos ($1.17 billion) in the first five months of the year, 39% more than during the same period in 2007, the country's banking regulator said Wednesday.

Locally owned private-sector banks reported COP1.42 trillion in profits in the first five months of the year, up 40% from COP1.01 trillion in the same period last year.

The banks' profits were boosted by the lending business, said Manuel Rey, head of research at local brokerage Asesores en Valores.

The country's total loan portfolio including lending from commercial banks and government institutions rose 22% at the end of May from the same period a year ago to COP118 trillion, according to figures from the regulator.

Net profit at Bancolombia (NYSE:CIB) (CIB), the country's largest bank, rose 58% in the January-May period from the same period a year ago to COP500 billion.

Banco de Bogota (Colombia:BOGOTA) (BOGOTA.BO), the country's second-largest bank, posted a net profit of COP265 billion in the first five months of the year, up 30% from the same period last year.

The local unit of Spain's BBVA (BBV) reported the biggest profit among foreign banks, posting a net profit of COP143 billion in the first five months of the year, up 4.4% from the COP137 billion registered in the same period last year.

The net profit of the Colombian unit of U.S.-based Citibank (NYSE:C) (C) jumped 77% to COP64 billion.

The local unit of HSBC Holdings PLC (NYSE:HBC) (HBC) was the only bank in Colombia to report a net loss in the first five months of 2008. HSBC's (NYSE:HBC) loss narrowed to COP2.1 billion from a net loss of COP9.1 billion in the first five months of 2007.

-By Inti Landauro, Dow Jones Newswires; 57-1-694 00 76; colombia@dowjones.com

    (END) Dow Jones Newswires   06-25-08 1310   Copyright (c) 2008 Dow Jones & Company, Inc.