10-Q

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

xQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2014

or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

       EXCHANGE ACT OF 1934

For the transition period from ______________ to ______________

Commission File Number 001-12647

OFG Bancorp

Incorporated in the Commonwealth of Puerto Rico, IRS Employer Identification No. 66-0538893

Principal Executive Offices: 

254 Muñoz Rivera Avenue

San Juan, Puerto Rico 00918

Telephone Number: (787) 771-6800

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x  No¨ 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x  No ¨ 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ý               Accelerated Filer o                Non-Accelerated Filer ¨                 Smaller Reporting Company ¨                                                                                            (Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨  No x 

Number of shares outstanding of the registrant’s common stock, as of thelatest practicable date:

 45,011,649 common shares ($1.00 par value per share) outstanding as of April 30, 2014

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION			Page
Item 1.	Financial Statements
	Unaudited Consolidated Statements of Financial Condition		1
	Unaudited Consolidated Statements of Operations		2
	Unaudited Consolidated Statements of Comprehensive Income		3
	Unaudited Consolidated Statements of Changes in Stockholders’ Equity		4
	Unaudited Consolidated Statements of Cash Flows		5
	Notes to Unaudited Consolidated Financial Statements
		Note 1– Organization, Consolidation and Basis of Presentation	7
		Note 2 – Restricted Cash	8
		Note 3 – Securities Purchased Under Agreements to Resell and Investments	8
		Note 4 – Loans	15
		Note 5 – Allowance for Loan and Lease Losses	26
		Note 6 – FDIC Loss Share Asset and True-up Payment Obligation	40
		Note 7 – Derivative Activities	41
		Note 8 – Accrued Interest Receivable and Other Assets	43
		Note 9 – Deposits and Related Interest	44
		Note 10 – Borrowings	45
		Note 11 – Offsetting Arrangements	49
		Note 12 – Related Party Transactions	51
		Note 13 – Income Taxes	51
		Note 14 – Stockholders’ Equity and Earnings per Common Share	52
		Note 15 – Guarantees	57
		Note 16 – Commitments and Contingencies	59
		Note 17 – Fair Value of Financial Instruments	61
		Note 18 – Business Segments	69
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		71
		Critical Accounting Policies and  Estimates	71
		Overview of Financial Performance	72
		Selected Financial Data	72
		Analysis of Results of Operations	78
		Analysis of Financial Condition	85
Item 3.	Quantitative and Qualitative Disclosures about Market Risk		109
Item 4.	Control and Procedures		113
PART II – OTHER INFORMATION
Item 1.	Legal Proceedings		114
Item 1A.	Risk Factors		114
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		115
Item 3.	Default upon Senior Securities		116
Item 4.	Mine Safety Disclosures		116
Item 5.	Other Information		116
Item 6.	Exhibits		116
SIGNATURES			117
EXHIBIT INDEX

FORWARD-LOOKING STATEMENTS

The information included in this quarterly report on Form 10-Q contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may relate to the financial condition, results of operations, plans, objectives, future performance and business of OFG Bancorp (“we,” “our,” “us” or the “Company”), including, but not limited to, statements with respect to the adequacy of the allowance for loan losses, delinquency trends, market risk and the impact of interest rate changes, capital markets conditions, capital adequacy and liquidity, and the effect of legal proceedings and new accounting standards on the Company’s financial condition and results of operations. All statements contained herein that are not clearly historical in nature are forward-looking, and the words “anticipate,” “believe,” “continues,” “expect,” “estimate,” “intend,” “project” and similar expressions and future or conditional verbs such as “will,” “would,” “should,” “could,” “might,” “can,” “may,” or similar expressions are generally intended to identify forward-looking statements.

These statements are not guarantees of future performance and involve certain risks, uncertainties, estimates and assumptions by management that are difficult to predict. Various factors, some of which by their nature are beyond the Company’s control, could cause actual results to differ materially from those expressed in, or implied by, such forward-looking statements. Factors that might cause such a difference include, but are not limited to:

·the rate of growth in the economy and employment levels, as well as general business and economic conditions;

·changes in interest rates, as well as the magnitude of such changes;

·the fiscal and monetary policies of the federal government and its agencies;

·a credit default by the government;

·changes in federal bank regulatory and supervisory policies, including required levels of capital;

·the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) on the

Company’s businesses, business practices and cost of operations;

·the relative strength or weakness of the consumer and commercial credit sectors and of the real estate market in

Puerto Rico;

·the performance of the stock and bond markets;

·competition in the financial services industry;

·additional Federal Deposit Insurance Corporation (“FDIC”) assessments; and

·possible legislative, tax or regulatory changes.

Other possible events or factors that could cause results or performance to differ materially from those expressed in these forward-looking statements include the following: negative economic conditions that adversely affect the general economy, housing prices, the job market, consumer confidence and spending habits which may affect, among other things, the level of non-performing assets, charge-offs and provision expense; changes in interest rates and market liquidity which may reduce interest margins, impact funding sources and affect the ability to originate and distribute financial products in the primary and secondary markets; adverse movements and volatility in debt and equity capital markets; changes in market rates and prices which may adversely impact the value of financial assets and liabilities; liabilities resulting from litigation and regulatory investigations; changes in accounting standards, rules and interpretations; increased competition; the Company’s ability to grow its core businesses; decisions to downsize, sell or close units or otherwise change the Company’s business mix; and management’s ability to identify and manage these and other risks.

All forward-looking statements included in this quarterly report on Form 10-Q are based upon information available to the Company as of the date of this report, and other than as required by law, including the requirements of applicable securities laws, the Company assumes no obligation to update or revise any such forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements.

ITEM 1.     FINANCIAL STATEMENTS

OFG BANCORP

UNAUDITED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

AS OF MARCH 31, 2014 AND DECEMBER 31, 2013

	March 31,		December 31,
	2014		2013
	(In thousands, except share data)
ASSETS
Cash and cash equivalents:
Cash and due from banks	$	616,984	$	614,302
Money market investments		7,652		6,967
Total cash and cash equivalents		624,636		621,269
Restricted cash		15,170		82,199
Securities purchased under agreements to resell		-		60,000
Investments:
Trading securities, at fair value, with amortized cost of $2,453 (December 31, 2013 - $2,448)		1,910		1,869
Investment securities available-for-sale, at fair value, with amortized cost of $1,437,106 (December 31, 2013 - $1,575,043)		1,455,685		1,588,425
Federal Home Loan Bank (FHLB) stock, at cost		24,430		24,450
Other investments		65		65
Total investments		1,482,090		1,614,809
Loans:
Mortgage loans held-for-sale, at lower of cost or fair value		19,355		46,529
Loans not covered under shared-loss agreements with the FDIC, net of allowance for loan and lease losses of $56,183 (December 31, 2013 - $54,298)		4,635,394		4,615,929
Loans covered under shared-loss agreements with the FDIC, net of allowance for loan and lease losses of $54,398 (December 31, 2013 - $52,729)		347,865		356,961
Total loans, net		5,002,614		5,019,419
Other assets:
FDIC shared-loss indemnification asset		166,194		189,240
Foreclosed real estate covered under shared-loss agreements with the FDIC		37,785		33,209
Foreclosed real estate not covered under shared-loss agreements with the FDIC		59,099		56,815
Accrued interest receivable		18,969		18,734
Deferred tax asset, net		127,657		137,564
Premises and equipment, net		83,029		82,903
Customers' liability on acceptances		28,152		23,042
Servicing assets		13,970		13,801
Derivative assets		15,861		20,502
Goodwill		86,069		86,069
Other assets		94,343		98,440
Total assets	$	7,855,638	$	8,158,015
LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits:
Demand deposits	$	2,188,458		2,138,005
Savings accounts		1,267,290		1,194,567
Time deposits		1,845,244		2,050,693
Total deposits		5,300,992		5,383,265
Borrowings:
Securities sold under agreements to repurchase		1,012,240		1,267,618
Advances from FHLB		335,689		336,143
Subordinated capital notes		100,404		100,010
Federal funds purchased		23,712		-
Other borrowings		3,708		3,663
Total borrowings		1,475,753		1,707,434
Other liabilities:
Derivative liabilities		13,830		14,937
Acceptances executed and outstanding		28,535		23,042
Accrued expenses and other liabilities		140,037		144,424
Total liabilities		6,959,147		7,273,102
Commitments and contingencies (See Note 16)
Stockholders’ equity:
Preferred stock; 10,000,000 shares authorized;
1,340,000 shares of Series A, 1,380,000 shares of Series B, and 960,000 shares of Series D
issued and outstanding, (December 31, 2013 - 1,340,000; 1,380,000; and 960,000) $25 liquidation value		92,000		92,000
84,000 shares of Series C issued and outstanding (December 31, 2013 - 84,000); $1,000 liquidation value		84,000		84,000
Common stock, $1 par value; 100,000,000 shares authorized; 52,713,673 shares issued:
45,003,924 shares outstanding (December 31, 2013 - 52,707,023; 45,676,922)		52,714		52,707
Additional paid-in capital		538,287		538,071
Legal surplus		64,292		61,957
Retained earnings		147,919		133,629
Treasury stock, at cost, 7,709,749 shares (December 31, 2013 - 7,030,101 shares)		(90,743)		(80,642)
Accumulated other comprehensive income, net of tax of $87 (December 31, 2013 - $831)		8,022		3,191
Total stockholders’ equity		896,491		884,913
Total liabilities and stockholders’ equity	$	7,855,638	$	8,158,015
See notes to unaudited consolidated financial statements.

1

OFG BANCORP

UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE QUARTERS ENDED MARCH 31, 2014 AND 2013

	Quarter Ended March 31,
	2014		2013
	(In thousands, except per share data)
Interest income:
Loans not covered under shared-loss agreements with the FDIC	$	85,243	$	80,807
Loans covered under shared-loss agreements with the FDIC		23,388		20,229
Total interest income from loans		108,631		101,036
Mortgage-backed securities		12,417		10,818
Investment securities and other		2,026		2,318
Total interest income		123,074		114,172
Interest expense:
Deposits		8,978		9,935
Securities sold under agreements to repurchase		7,411		7,248
Advances from FHLB and other borrowings		2,295		1,713
Subordinated capital notes		992		1,660
Total interest expense		19,676		20,556
Net interest income		103,398		93,616
Provision for non-covered loan and lease losses		10,062		7,916
Provision for covered loan and lease losses, net		1,629		672
Total provision for loan and lease losses		11,691		8,588
Net interest income after provision for loan and lease losses		91,707		85,028
Non-interest income:
Banking service revenue		10,606		11,838
Financial service revenue		6,867		7,660
Mortgage banking activities		1,950		3,153
Total banking and financial service revenues		19,423		22,651
FDIC shared-loss expense, net:
FDIC shared-loss indemnification asset		(17,622)		(12,201)
True-up payment obligation		(865)		(670)
		(18,487)		(12,871)
Net gain (loss) on:
Sale of securities		4,366		-
Derivatives		(478)		(788)
Early extinguishment of debt		-		1,061
Other non-interest income		454		46
Total non-interest income, net		5,278		10,099
Non-interest expense:
Compensation and employee benefits		21,787		23,249
Professional and service fees		4,206		6,478
Occupancy and equipment		8,309		9,216
Insurance		2,074		2,678
Electronic banking charges		4,743		3,728
Information technology expenses		1,815		2,643
Advertising, business promotion, and strategic initiatives		1,781		1,409
Merger and restructuring charges		-		5,534
Foreclosure, repossession and other real estate expenses		6,436		3,382
Loan servicing and clearing expenses		2,060		1,475
Taxes, other than payroll and income taxes		3,735		2,622
Communication		957		864
Printing, postage, stationary and supplies		554		1,166
Director and investor relations		251		236
Other		2,745		2,129
Total non-interest expense		61,453		66,809
Income before income taxes		35,532		28,318
Income tax expense		11,785		7,126
Net income		23,747		21,192
Less: dividends on preferred stock		(3,465)		(3,465)
Income available to common shareholders	$	20,282	$	17,727
Earnings per common share:
Basic	$	0.45	$	0.39
Diluted	$	0.42	$	0.37
Average common shares outstanding and equivalents		52,598		52,892
Cash dividends per share of common stock	$	0.08	$	0.06
See notes to unaudited consolidated financial statements.

2

OFG BANCORP

UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

FOR THE QUARTERS ENDED MARCH 31, 2014 AND 2013

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Net income	$	23,747	$	21,192
Other comprehensive income (loss) before tax:
Unrealized gain (loss) on securities available-for-sale		9,563		(10,992)
Realized gain on investment securities included in net income		(4,366)		-
Unrealized gain on cash flow hedges		378		1,462
Other comprehensive income (loss) before taxes		5,575		(9,530)
Income tax effect		(744)		701
Other comprehensive income (loss) after taxes		4,831		(8,829)
Comprehensive income	$	28,578	$	12,363
See notes to unaudited consolidated financial statements.

3

OFG BANCORP

UNAUDITED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THE QUARTERS ENDED MARCH 31, 2014 AND2013

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Preferred stock:
Balance at beginning of period	$	176,000	$	176,000
Balance at end of period		176,000		176,000
Common stock:
Balance at beginning of period		52,707		52,671
Exercised stock options		7		-
Balance at end of period		52,714		52,671
Additional paid-in capital:
Balance at beginning of period		538,071		537,453
Stock-based compensation expense		439		437
Exercised stock options		71		-
Lapsed restricted stock units		(294)		(351)
Common stock issuance costs		-		(23)
Preferred stock issuance costs		-		(16)
Balance at end of period		538,287		537,500
Legal surplus:
Balance at beginning of period		61,957		52,143
Transfer from retained earnings		2,335		1,985
Balance at end of period		64,292		54,128
Retained earnings:
Balance at beginning of period		133,629		70,734
Net income		23,747		21,192
Cash dividends declared on common stock		(3,657)		(2,737)
Cash dividends declared on preferred stock		(3,465)		(3,465)
Transfer to legal surplus		(2,335)		(1,985)
Balance at end of period		147,919		83,739
Treasury stock:
Balance at beginning of period		(80,642)		(81,275)
Stock repurchased		(10,393)		-
Lapsed restricted stock units		292		351
Stock used to match defined contribution plan		-		77
Balance at end of period		(90,743)		(80,847)
Accumulated other comprehensive income, net of tax:
Balance at beginning of period		3,191		55,880
Other comprehensive income (loss), net of tax		4,831		(8,829)
Balance at end of period		8,022		47,051
Total stockholders’ equity	$	896,491	$	870,242
See notes to unaudited consolidated financial statements.

4

OFG BANCORP

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE QUARTERS ENDED MARCH 31, 2014 AND 2013

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Cash flows from operating activities:
Net income	$	23,747	$	21,192
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of deferred loan origination fees, net of costs		601		256
Amortization of fair value discounts on acquired loans		3,634		2,579
Amortization of investment securities premiums, net of accretion of discounts		412		6,200
Amortization of core deposit and customer relationship intangibles		542		644
Amortization of fair value premiums on acquired deposits		1,897		5,267
FDIC shared-loss expense, net		18,487		12,871
Amortization of prepaid FDIC assessment		-		860
Other impairments on securities		-		7
Depreciation and amortization of premises and equipment		2,399		3,092
Deferred income taxes, net		(826)		5,265
Provision for covered and non-covered loan and lease losses, net		11,691		8,588
Stock-based compensation		439		437
(Gain) loss on:
Sale of securities		(4,366)		-
Sale of mortgage loans held-for-sale		(1,242)		(1,631)
Derivatives		478		788
Early extinguishment of debt		-		(1,061)
Foreclosed real estate		1,500		1,793
Sale of other repossessed assets		1,973		84
Sale of premises and equipment		(2)		-
Originations of loans held-for-sale		(50,843)		(68,493)
Proceeds from sale of loans held-for-sale		24,653		29,347
Net (increase) decrease in:
Trading securities		(41)		(1,292)
Accrued interest receivable		(235)		(2,677)
Servicing assets		(169)		(748)
Other assets		4,935		1,446
Net increase (decrease) in:
Accrued interest on deposits and borrowings		(1,382)		(391)
Accrued expenses and other liabilities		2,362		(2,518)
Net cash provided by operating activities		40,644		21,905
Cash flows from investing activities:
Purchases of:
Investment securities available-for-sale		(127,373)		(1,383)
FHLB stock		(48,600)		(3,150)
Maturities and redemptions of:
Investment securities available-for-sale		153,340		163,940
FHLB stock		48,620		8,103
Proceeds from sales of:
Investment securities available-for-sale		139,152		29,062
Foreclosed real estate and other repossessed assets		13,392		6,036
Premises and equipment		10		155
Origination and purchase of loans, excluding loans held-for-sale		(161,182)		(206,229)
Principal repayment of loans, including covered loans		141,118		161,912
Reimbursements from the FDIC on shared-loss agreements		8,236		6,650
Additions to premises and equipment		(2,532)		(1,711)
Net change in securities purchased under agreements to resell		60,000		20,000
Net change in restricted cash		67,029		5,060
Net cash provided by investing activities		291,210		188,445

5

OFG BANCORP

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS – (Continued)

FOR THE QUARTERS ENDED MARCH 31, 2014 AND 2013

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Cash flows from financing activities:
Net increase (decrease) in:
Deposits		(79,572)		(133,055)
Short term borrowings		-		(31,382)
Securities sold under agreements to repurchase		(255,000)		(203,636)
FHLB advances, federal funds purchased, and other borrowings		23,311		(91,185)
Subordinated capital notes		394		(46,541)
Exercise of stock options and restricted units lapsed, net		76		-
Purchase of treasury stock		(10,393)		-
Termination of derivative instruments		(181)		(9)
Dividends paid on preferred stock		(3,465)		(3,465)
Dividends paid on common stock		(3,657)		(2,737)
Other financing activities		-		(39)
Net cash used in financing activities		(328,487)		(512,049)
Net change in cash and cash equivalents		3,367		(301,699)
Cash and cash equivalents at beginning of period		621,269		868,695
Cash and cash equivalents at end of period	$	624,636	$	566,996
Supplemental Cash Flow Disclosure and Schedule of Non-cash Activities:
Interest paid	$	22,620	$	21,243
Mortgage loans securitized into mortgage-backed securities	$	23,228	$	27,679
Transfer from loans to foreclosed real estate and other repossessed assets	$	25,106	$	15,459
Reclassification of loans held-for-investment portfolio to held-for-sale portfolio	$	1,747	$	-
Reclassification of loans held-for-sale portfolio to held-for-investment portfolio	$	33,125	$	-
See notes to unaudited consolidated financial statements.

6

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 –  ORGANIZATION, CONSOLIDATION AND BASIS OF PRESENTATION

Nature of Operations

OFG Bancorp (the “Company”) is a publicly-owned financial holding company incorporated under the laws of the Commonwealth of Puerto Rico. The Company operates through various subsidiaries including, a commercial bank, Oriental Bank (or the “Bank”), a securities broker-dealer, Oriental Financial Services Corp. (“Oriental Financial Services”), an insurance agency, Oriental Insurance, Inc. (“Oriental Insurance”) and a retirement plan administrator, Caribbean Pension Consultants, Inc. (“CPC”). The Company also has a special purpose entity, Oriental Financial (PR) Statutory Trust II (the “Statutory Trust II”). Through these subsidiaries and their respective divisions, the Company provides a wide range of banking and financial services such as commercial, consumer and mortgage lending, leasing, auto loans, financial planning, insurance sales, money management and investment banking and brokerage services, as well as corporate and individual trust services. On April 25, 2013, the Company changed its corporate name from Oriental Financial Group Inc. to OFG Bancorp.

On April 30, 2010, the Bank acquired certain assets and assumed certain deposits and other liabilities in the FDIC-assisted acquisition of Eurobank. On December 18, 2012, the Company purchased Banco Bilbao Vizcaya Argentaria Puerto Rico (“BBVAPR”), referred to as the “BBVAPR Acquisition.”

Recent Accounting Developments

Reclassification of Defaulted Consumer Mortgage Loans upon Foreclosure - In January 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-04, Receivables—Troubled Debt Restructurings by Creditors (Subtopic 310-40): Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure. This ASU clarifies when an in-substance repossession or foreclosure occurs that would require a transfer of the mortgage loan to other real estate owned (OREO). Under the ASU, repossession or foreclosure is deemed to have occurred when (1) the creditor obtains legal title to the residential real estate property or (2) the borrower conveys all interest in the residential real estate property to the creditor to satisfy the mortgage loan through completion of a deed in lieu of foreclosure or a similar legal agreement. The ASU will become effective for annual and interim periods beginning after December 15, 2014. The ASU can be adopted using either a modified retrospective method or a prospective transition method with the cumulative effect being recognized in the beginning retained earnings of the earliest annual period for which the ASU is adopted. The adoption of this guidance will not have a material effect on our consolidated financial statements, since the Company already follows the same basis approach.

Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carry-forward, a Similar Tax Loss, or a Tax Credit Carry-forward Exists In July 2013, FASB issued ASU No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carry-forward, a Similar Tax Loss, or a Tax Credit Carry-forward Exists (a consensus of the FASB Emerging Issues Task, which requires that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. When a net operating loss, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional taxes that would result from the disallowance of a tax position, or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purposes, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The assessment of whether a deferred tax asset is available is based on the unrecognized tax benefit and deferred tax asset that exist at the reporting date and should be made presuming disallowance of the tax position at the reporting date. Currently, there is no explicit guidance under U.S. GAAP on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The amendment of this guidance does not require new recurring disclosures. ASU 2013-11 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. Early adoption is permitted. The amendments of this ASU should be applied prospectively to all unrecognized tax benefits that exist at the effective date. Retrospective application is permitted. The adoption of this guidance did not have a material effect on our consolidated financial statements, since the Company already followed the same basis approach.

7

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

NOTE 2 – RESTRICTED CASH

The following table includes the composition of the restricted cash:

	March 31,		December 31,
	2014		2013
	(In thousands)
Deposits pledged as collateral to other financial institutions to secure:
Securities sold under agreements to repurchase	$	-	$	67,029
Derivatives		2,980		2,980
Obligations under agreement of loans sold with recourse		12,190		12,190
	$	15,170	$	82,199

The Company delivers cash as collateral to meet margin calls for some long term securities sold under agreements to repurchase. An alternative to cash delivery is entering into securities purchased under agreements to resell and use the securities collateral received as collateral to be delivered. At December 31, 2013, the possibility of entering into securities purchased under agreements to resell to receive securities collateral and then deliver it to counterparties securities sold under agreements to repurchase was very limited for market reasons. Therefore, at December 31, 2013, the Company had $67.0 million in cash collateral delivered. At March 31, 2014, the Company did not have cash collateral delivered.

As part of the BBVAPR Acquisition, the Company assumed a contract with FNMA which required collateral to guarantee the repurchase, if necessary, of loans sold with recourse. At March 31, 2014 and December 31, 2013, the Company delivered cash amounting to $12.2 million.

NOTE 3 – SECURITIES PURCHASED UNDER AGREEMENTS TO RESELL AND INVESTMENTS

Money Market Investments

The Company considers as cash equivalents all money market instruments that are not pledged and that have maturities of three months or less at the date of acquisition. At March 31, 2014 and December 31, 2013, money market instruments included as part of cash and cash equivalents amounted to $7.7 million and $7.0 million, respectively.

Securities Purchased Under Agreements to Resell

Securities purchased under agreements to resell consist of short-term investments and are carried at the amounts at which the assets will be subsequently resold as specified in the respective agreements. At December 31, 2013, securities purchased under agreements to resell amounted to $60.0 million. At March 31, 2014, there were no securities purchased under agreements to resell.

The amounts advanced under those agreements are reflected as assets in the consolidated statements of financial condition. It is the Company’s policy to take possession of securities purchased under agreements to resell. Agreements with third parties specify the Company’s right to request additional collateral based on its monitoring of the fair value of the underlying securities on a daily basis. The fair value of the collateral securities held by the Company on these transactions as of December 31, 2013 was approximately $64.6 million.

8

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Investment Securities

The amortized cost, gross unrealized gains and losses, fair value, and weighted average yield of the securities owned by the Company at March 31, 2014 and December 31, 2013 were as follows:

	March 31, 2014
			Gross		Gross				Weighted
	Amortized		Unrealized		Unrealized		Fair		Average
	Cost		Gains		Losses		Value		Yield
	(In thousands)
Available-for-sale
Mortgage-backed securities
FNMA and FHLMC certificates	$	1,093,717	$	31,769	$	4,690	$	1,120,796		3.03%
GNMA certificates		6,146		426		23		6,549		4.93%
CMOs issued by US Government-sponsored agencies		211,308		351		4,139		207,520		1.78%
Total mortgage-backed securities		1,311,171		32,546		8,852		1,334,865		2.84%
Investment securities
US Treasury securities		70,000		-		-		70,000		0.03%
Obligations of US Government-sponsored agencies		9,539		-		42		9,497		1.23%
Obligations of Puerto Rico Government and             political subdivisions		22,367		-		5,298		17,069		5.32%
Other debt securities		24,029		225		-		24,254		3.46%
Total investment securities		125,935		225		5,340		120,820		1.72%
Total securities available for sale	$	1,437,106	$	32,771	$	14,192	$	1,455,685		2.74%

	December 31, 2013
			Gross		Gross				Weighted
	Amortized		Unrealized		Unrealized		Fair		Average
	Cost		Gains		Losses		Value		Yield
	(In thousands)
Available-for-sale
Mortgage-backed securities
FNMA and FHLMC certificates	$	1,190,910	$	33,089	$	6,669	$	1,217,330		2.93%
GNMA certificates		7,406		433		24		7,815		4.92%
CMOs issued by US Government-sponsored agencies		220,801		407		6,814		214,394		1.78%
Total mortgage-backed securities		1,419,117		33,929		13,507		1,439,539		2.76%
Investment securities
Obligations of US Government-sponsored agencies		10,691		-		42		10,649		1.21%
Obligations of Puerto Rico Government and             political subdivisions		121,035		-		6,845		114,190		4.38%
Other debt securities		24,200		167		320		24,047		3.46%
Total investment securities		155,926		167		7,207		148,886		2.99%
Total securities available-for-sale	$	1,575,043	$	34,096	$	20,714	$	1,588,425		2.89%

9

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The amortized cost and fair value of the Company’s investment securities at March 31, 2014, by contractual maturity, are shown in the next table. Securities not due on a single contractual maturity date, such as collateralized mortgage obligations, are classified in the period of final contractual maturity. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

	March 31, 2014
	Available-for-sale
	Amortized Cost		Fair Value
	(In thousands)
Mortgage-backed securities
Due after 5 to 10 years
FNMA and FHLMC certificates	$	26,294	$	26,625
Total due after 5 to 10 years		26,294		26,625
Due after 10 years
FNMA and FHLMC certificates		1,067,423		1,094,171
GNMA certificates		6,146		6,549
CMOs issued by US Government-sponsored agencies		211,308		207,520
Total due after 10 years		1,284,877		1,308,240
Total  mortgage-backed securities		1,311,171		1,334,865
Investment securities
Due in less than one year
US Treasury securities		70,000		70,000
Other debt securities		20,000		20,053
Total due in less than one year		90,000		90,053
Due from 1 to 5 years
Obligations of Puerto Rico Government and political subdivisions		11,903		9,827
Total due from 1 to 5 years		11,903		9,827
Due after 5 to 10 years
Obligations of US Government and sponsored agencies		9,539		9,497
Total due after 5 to 10 years		9,539		9,497
Due after 10 years
Obligations of Puerto Rico Government and political subdivisions		10,464		7,242
Other debt securities		4,029		4,201
Total due after 10 years		14,493		11,443
Total  investment securities		125,935		120,820
Total securities available-for-sale	$	1,437,106	$	1,455,685

10

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

At December 31, 2013 obligations of Puerto Rico Government and political subdivisions included a $98.7 million principal amount, LIBOR floating rate bond with maturity date of July 1, 2024, that was subject to mandatory tender for purchase by the end of the third year anniversary of the closing date, which was June 1, 2014. The bond was also subject to optional demand tender for purchase upon the occurrence and continuance of certain events, including (among others) the withdrawal, suspension or reduction below investment grade of the credit rating on any general obligation of the Commonwealth by any of the three major rating agencies. This bond was repaid by the issuer on March 1, 2014.

The Company, as part of its asset/liability management, may purchase U.S. Treasury securities and U.S. government-sponsored agency discount notes close to their maturities as alternatives to cash deposits at correspondent banks or as a short term vehicle to reinvest the proceeds of sale transactions until investment securities with attractive yields can be purchased. During the quarter ended March 31, 2014, the Company sold $24.0 million of available-for-sale GNMA certificates that were sold as part of its recurring mortgage loan origination and securitization activities. These sales did not realize any gains or losses during such period. In addition, during the quarter ended March 31, 2014, there were certain sales of available-for-sale securities because the Company believed that gains could be realized and that there were good opportunities to invest the proceeds in other investment securities with attractive yields and terms that would allow the Company to continue protecting its net interest margin.

For the quarter ended March 31, 2014 the Company recorded a net gain on sale of securities of $4.4 million. The tables below present the gross realized gains by category for such period. There was no realized gain or loss for the quarter ended March 31, 2013.

	Quarter Ended March 31, 2014
			Book Value		Gross		Gross
Description	Sale Price		at Sale		Gains		Losses
	(In thousands)
Sale of securities available-for-sale
Mortgage-backed securities
FNMA and FHLMC certificates	$	115,159	$	110,792	$	4,366	$	-
GNMA certificates		23,993		23,993		-		-
Total	$	139,152	$	134,785	$	4,366	$	-

11

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following tables show the Company’s gross unrealized losses and fair value of investment securities available-for-sale, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at March 31, 2014 and December 31, 2013:

	March 31, 2014
	12 months or more
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
CMOs issued by US Government-sponsored agencies	$	1,897	$	163	$	1,734
Obligations of Puerto Rico Government and political subdivisions		22,367		5,298		17,069
GNMA certificates		80		10		70
	$	24,344	$	5,471	$	18,873
	Less than 12 months
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
CMOs issued by US Government-sponsored agencies	$	177,882	$	3,976	$	173,906
FNMA and FHLMC certificates		214,926		4,690		210,236
Obligations of US government and sponsored agencies		9,539		42		9,497
GNMA certificates		121		13		108
	$	402,468	$	8,721	$	393,747
	Total
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
CMOs issued by US Government-sponsored agencies	$	179,779	$	4,139	$	175,640
FNMA and FHLMC certificates		214,926		4,690		210,236
Obligations of Puerto Rico Government and political subdivisions		22,367		5,298		17,069
Obligations of US government and sponsored agencies		9,539		42		9,497
GNMA certificates		201		23		178
	$	426,812	$	14,192	$	412,620

12

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

	December 31, 2013
	12 months or more
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
Obligations of Puerto Rico Government and political subdivisions	$	20,845	$	5,470	$	15,375
CMOs issued by US Government-sponsored agencies		2,559		237		2,322
GNMA certificates		81		11		70
	$	23,485	$	5,718	$	17,767
	Less than 12 months
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
Obligations of Puerto Rico Government and political subdivisions	$	100,190	$	1,375	$	98,815
CMOs issued by US Government-sponsored agencies		182,661		6,577		176,084
GNMA certificates		122		13		109
FNMA and FHLMC certificates		220,913		6,669		214,244
Obligations of US Government and sponsored agencies		10,691		42		10,649
Other debt securities		20,000		320		19,680
	$	534,577	$	14,996	$	519,581
	Total
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
Obligations of Puerto Rico Government and political subdivisions	$	121,035	$	6,845	$	114,190
CMOs issued by US Government-sponsored agencies		185,220		6,814		178,406
GNMA certificates		203		24		179
FNMA and FHLMC certificates		220,913		6,669		214,244
Obligations of US Government and sponsored agencies		10,691		42		10,649
Other debt securities		20,000		320		19,680
	$	558,062	$	20,714	$	537,348

13

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The valuations of the investment securities are performed on a monthly basis. Moreover, the Company conducts quarterly reviews to identify and evaluate each investment in an unrealized loss position for other-than-temporary impairment. Any portion of a decline in value associated with credit loss is recognized in income with the remaining noncredit-related component recognized in other comprehensive income. A credit loss is determined by assessing whether the amortized cost basis of the security will be recovered by comparing the present value of cash flows expected to be collected from the security, discounted at the rate equal to the yield used to accrete current and prospective beneficial interest for the security. The shortfall of the present value of the cash flows expected to be collected in relation to the amortized cost basis is considered to be the “credit loss.” Other-than-temporary impairment analysis is based on estimates that depend on market conditions and are subject to further change over time. In addition, while the Company believes that the methodology used to value these exposures is reasonable, the methodology is subject to continuing refinement, including those made as a result of market developments. Consequently, it is reasonably possible that changes in estimates or conditions could result in the need to recognize additional other-than-temporary impairment charges in the future.

Most of the investments in an unrealized loss position at March 31, 2014 ($404.4 million or 95%) consist of securities issued or guaranteed by the U.S. Treasury or U.S. government-sponsored agencies, all of which are highly liquid securities that have a large and efficient secondary market. Their aggregate losses and their variability from period to period are the result of changes in market conditions, and not due to the repayment capacity or creditworthiness of the issuers or guarantors of such securities.

The remaining investments in an unrealized loss position at March 31, 2014 ($22.4 million or 5%) consist of obligations issued or collateralized by the government of Puerto Rico and its political subdivisions or instrumentalities. The recent decline in the market value of these securities is mainly attributed to an increase in volatility as a result of changes in market conditions that reflect the significant economic and fiscal challenges that Puerto Rico is facing, including a protracted economic recession, sizable government debt-service obligations and structural budget deficits, high unemployment and a shrinking population. As of March 31, 2014, the Company analyzed these investments under a plausible set of scenarios that included the possibility of a further downgrade in the credit ratings of the Commonwealth, and also considered numerous factors that, in the Company’s view, support the ability of the Commonwealth to continue servicing its debt obligations. Such factors include (i) the collateralization and sources of repayment for such debt obligations; (ii) the government’s efforts to increase revenues and reduce expenses to tackle its recurrent budget deficits; (iii) the Commonwealth’s constitutional framework that provides that “public debt” (e.g., general obligation bonds such as the $98.7 million principal amount Puerto Rico government bond owned by the Company, and repaid by the issuer on March 1, 2014) constitutes a first claim on available Commonwealth resources; and (iv) the Commonwealth’s compliance and commitment to its contractual debt obligations. In addition, the Company believes it is probable that it will collect all amounts due according to the contractual terms of its Puerto Rico government bonds. Based on these factors, the Company expects that such bonds will be repaid in full when due, and given that the Company does not have the intent to sell any such bonds in an unrealized loss position, the Company does not consider them to be other-than-temporarily impaired as of March 31, 2014.

14

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

NOTE 4 - LOANS 

The Company’s loan portfolio is composed of covered loans and non-covered loans. The Company presents loans subject to the loss sharing agreements as “covered loans” in the tables below, and loans that are not subject to FDIC loss sharing agreements as “non-covered loans.” The risks of the FDIC-assisted Eurobank acquisition acquired loans are different from those loans not covered under the FDIC loss sharing agreements because of the loss protection provided by the FDIC. Also, loans acquired in the BBVAPR Acquisition are included as non-covered loans in the unaudited consolidated statements of financial condition. Non-covered loans are further segregated between originated and other loans, acquired loans accounted for under ASC 310-20 (loans with revolving feature and/or acquired at a premium), and acquired loans accounted for under ASC 310-30 (loans acquired with deteriorated credit quality, including those by analogy).

The composition of the Company’s loan portfolio at March 31, 2014 and December 31, 2013 was as follows:

	March 31,		December 31,
	2014		2013
	(In thousands)
Loans not covered under shared-loss agreements with FDIC:
Originated and other loans and leases held for investment:
Mortgage	$	782,150	$	766,265
Commercial		1,170,145		1,127,657
Consumer		142,492		127,744
Auto and leasing		447,940		379,874
		2,542,727		2,401,540
Acquired loans:
Accounted for under ASC 310-20 (Loans with revolving feature and/or
acquired at a premium)
Commercial		71,577		77,681
Consumer		52,049		56,174
Auto		268,865		301,584
		392,491		435,439
Accounted for under ASC 310-30 (Loans acquired with deteriorated
credit quality, including those by analogy)
Mortgage		703,454		717,904
Commercial		532,695		545,117
Construction		122,693		126,427
Consumer		53,310		63,620
Auto		341,889		379,145
		1,754,041		1,832,213
		4,689,259		4,669,192
Deferred loan cost , net		2,318		1,035
Loans receivable		4,691,577		4,670,227
Allowance for loan and lease losses on non-covered loans		(56,183)		(54,298)
Loans receivable, net		4,635,394		4,615,929
Mortgage loans held-for-sale		19,355		46,529
Total loans not covered under shared-loss agreements with FDIC, net		4,654,749		4,662,458
Loans covered under shared-loss agreements with FDIC:
Loans secured by 1-4 family residential properties		124,239		121,748
Construction and development secured by 1-4 family residential properties		18,254		17,304
Commercial and other construction		253,804		264,249
Consumer		5,769		6,119
Leasing		197		270
Total loans covered under shared-loss agreements with FDIC		402,263		409,690
Allowance for loan and lease losses on covered loans		(54,398)		(52,729)
Total loans covered under shared-loss agreements with FDIC, net		347,865		356,961
Total loans, net	$	5,002,614	$	5,019,419

During the quarter ended March 31, 2014, the Company reclassified $23.5 million in mortgage loans held-for-sale to held-for-investment. 

15

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Non-covered Loans

Originated and Other Loans and Leases Held for Investment

The Company’s originated and other loans held for investment are encompassed within four portfolio segments: mortgage, commercial, consumer, and auto and leasing.

The following tables present the aging of the recorded investment in gross originated and other loans held for investment as of March 31, 2014 and December 31, 2013 by class of loans. Mortgage loans past due included delinquent loans in the GNMA buy-back option program. Servicers of loans underlying GNMA mortgage-backed securities must report as their own assets the defaulted loans that they have the option (but not the obligation) to repurchase, even when they elect not to exercise that option.

	March 31, 2014
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Mortgage
Traditional (by origination year):
Up to the year 2002	$	5,330	$	2,620	$	2,877	$	10,827	$	61,269	$	72,096	$	91
Years 2003 and 2004		5,494		2,445		2,342		10,281		53,234		63,515		-
Year 2005		6,620		2,288		6,289		15,197		72,621		87,818		-
Year 2006		10,151		4,376		4,474		19,001		97,903		116,904		-
Years 2007, 2008             and 2009		3,807		2,025		4,850		10,682		87,158		97,840		-
Years 2010, 2011, 2012, 2013             and 2014		3,890		1,122		4,939		9,951		172,216		182,167		167
		35,292		14,876		25,771		75,939		544,401		620,340		258
Non-traditional		1,744		470		2,425		4,639		35,151		39,790		-
Loss mitigation program		8,149		6,485		12,559		27,193		58,812		86,005		2,254
		45,185		21,831		40,755		107,771		638,364		746,135		2,512
Home equity secured personal loans		-		-		138		138		595		733		-
GNMA's buy-back option program		-		-		35,282		35,282		-		35,282		-
		45,185		21,831		76,175		143,191		638,959		782,150		2,512
Commercial
Commercial secured by real estate:
Corporate		-		-		-		-		62,935		62,935		-
Institutional		-		-		-		-		9,833		9,833		-
Middle market		-		-		1,531		1,531		168,222		169,753		-
Retail		1,241		277		4,780		6,298		150,396		156,694		-
Floor plan		-		-		-		-		1,699		1,699		-
Real estate		-		-		-		-		11,837		11,837		-
		1,241		277		6,311		7,829		404,922		412,751		-
Other commercial and industrial:
Corporate		-		-		-		-		28,475		28,475		-
Institutional		-		-		-		-		553,249		553,249		-
Middle market		-		-		513		513		82,420		82,933		-
Retail		609		292		1,622		2,523		64,532		67,055		-
Floor plan		-		-		-		-		25,682		25,682		-
		609		292		2,135		3,036		754,358		757,394		-
		1,850		569		8,446		10,865		1,159,280		1,170,145		-

16

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

	March 31, 2014
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Consumer
Credit cards		263		171		354		788		14,702		15,490		-
Overdrafts		28		11		4		43		288		331		-
Personal lines of credit		60		99		57		216		1,718		1,934		-
Personal loans		1,418		524		248		2,190		105,847		108,037		-
Cash collateral personal loans		375		46		16		437		16,263		16,700		-
		2,144		851		679		3,674		138,818		142,492		-
Auto and leasing		33,788		8,559		5,872		48,219		399,721		447,940		-
Total	$	82,967	$	31,810	$	91,172	$	205,949	$	2,336,778	$	2,542,727	$	2,512

17

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

	December 31, 2013
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Mortgage
Traditional (by origination year):
Up to the year 2002	$	6,697	$	1,635	$	3,408	$	11,740	$	64,772	$	76,512	$	79
Years 2003 and 2004		4,722		2,163		1,845		8,730		56,387		65,117		-
Year 2005		8,527		2,119		4,808		15,454		74,087		89,541		-
Year 2006		12,055		4,312		4,418		20,785		99,537		120,322		-
Years 2007, 2008             and 2009		3,464		1,104		4,663		9,231		91,919		101,150		152
Years 2010, 2011, 2012             and 2013		3,923		1,609		4,453		9,985		139,561		149,546		459
		39,388		12,942		23,595		75,925		526,263		602,188		690
Non-traditional		3,217		1,162		2,311		6,690		35,412		42,102		-
Loss mitigation program		9,759		5,560		13,191		28,510		57,808		86,318		2,185
		52,364		19,664		39,097		111,125		619,483		730,608		2,875
Home equity secured personal loans		-		-		138		138		598		736		-
GNMA's buy-back option program		-		-		34,921		34,921		-		34,921		-
		52,364		19,664		74,156		146,184		620,081		766,265		2,875
Commercial
Commercial secured by real estate:
Corporate		-		-		-		-		54,796		54,796		-
Institutional		-		-		-		-		4,050		4,050		-
Middle market		1,356		-		10,294		11,650		149,933		161,583		-
Retail		4,253		1,015		3,190		8,458		158,184		166,642		-
Floor plan		-		-		-		-		1,835		1,835		-
Real estate		-		-		-		-		11,655		11,655		-
		5,609		1,015		13,484		20,108		380,453		400,561		-
Other commercial and industrial:
Corporate		236		-		-		236		32,362		32,598		-
Institutional		-		-		-		-		536,445		536,445		-
Middle market		-		299		1,134		1,433		57,464		58,897		-
Retail		1,830		552		539		2,921		58,589		61,510		-
Floor plan		39		-		-		39		37,607		37,646		-
		2,105		851		1,673		4,629		722,467		727,096		-
		7,714		1,866		15,157		24,737		1,102,920		1,127,657		-

18

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

	December 31, 2013
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Consumer
Credit cards		287		168		232		687		14,554		15,241		-
Overdrafts		46		4		-		50		322		372		-
Personal lines of credit		33		38		66		137		1,844		1,981		-
Personal loans		1,324		399		352		2,075		92,485		94,560		-
Cash collateral personal loans		324		43		-		367		15,223		15,590		-
		2,014		652		650		3,316		124,428		127,744		-
Auto and leasing		25,531		9,437		5,089		40,057		339,817		379,874		-
Total	$	87,623	$	31,619	$	95,052	$	214,294	$	2,187,246	$	2,401,540	$	2,875

At March 31, 2014, the increase in delinquencies in the consumer and the auto and leasing portfolios compared to December 31, 2013 is mainly attributed to the fact that non-performing loans of acquired non-covered loan portfolio were accounted for under ASC 310-30. At March 31, 2014 such portfolios are increasing as new originations are ramping up the balances outstanding. More than a year from the acquisition, those portfolios are beginning to reflect normal delinquency levels as seasoned portfolios.

At March 31, 2014, the Company had $539.9 million in loans granted to the Puerto Rico government, including its instrumentalities, public corporations and municipalities as part of the institutional commercial loan segment. This entire amount was current at March 31, 2014.

19

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Acquired Loans Accounted for under ASC 310-20 (Loans with revolving feature and/or acquired at a premium)

Credit cards, retail and commercial revolving lines of credits, floor plans and performing auto loans with FICO scores over 660 acquired at a premium as part of the non-covered portfolio are accounted for under the guidance of ASC 310-20, which requires that any contractually required loan payment receivable in excess of the Company’s initial investment in the loans be accreted into interest income on a level-yield basis over the life of the loan. Loans accounted for under ASC 310-20 are placed on non-accrual status when past due in accordance with the Company’s non-accrual policy and any accretion of discount or amortization of premium is discontinued. Loans acquired in the non-covered portfolio that were accounted for under the provisions of ASC 310-20 are removed from the acquired loan category at the end of the reporting period upon refinancing, renewal or normal re-underwriting.

The following table presents the aging of the recorded investment in gross acquired loans accounted for under ASC 310-20 as of March 31, 2014 and December 31, 2013, by class of loans:

	March 31, 2014
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Commercial
Commercial secured by real estate
Corporate	$	-	$	-	$	-	$	-	$	11,079	$	11,079	$	-
Retail		47		-		603		650		3,651		4,301		-
Floor plan		-		-		101		101		2,651		2,752		-
		47		-		704		751		17,381		18,132		-
Other commercial and industrial
Corporate		14		-		82		96		2,851		2,947		-
Institutional		-		-		-		-		221		221		-
Retail		645		128		716		1,489		15,727		17,216		-
Floor plan		84		-		126		210		32,851		33,061		-
		743		128		924		1,795		51,650		53,445		-
		790		128		1,628		2,546		69,031		71,577		-
Consumer
Credit cards		1,413		781		2,078		4,272		44,109		48,381		-
Personal loans		105		83		57		245		3,423		3,668		-
		1,518		864		2,135		4,517		47,532		52,049		-
Auto		13,161		3,522		1,342		18,025		250,840		268,865		-
Total	$	15,469	$	4,514	$	5,105	$	25,088	$	367,403	$	392,491	$	-

20

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

	December 31, 2013
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Commercial
Commercial secured by real estate
Corporate	$	-	$	-	$	-	$	-	$	10,166	$	10,166	$	-
Retail		431		331		868		1,630		4,140		5,770		-
Floor plan		-		-		101		101		2,576		2,677		-
		431		331		969		1,731		16,882		18,613		-
Other commercial and industrial
Corporate		14		83		-		97		9,696		9,793		-
Retail		1,717		1,418		659		3,794		23,544		27,338		-
Floor plan		35		193		18		246		21,691		21,937		-
		1,766		1,694		677		4,137		54,931		59,068		-
		2,197		2,025		1,646		5,868		71,813		77,681		-
Consumer
Credit cards		2,217		1,200		2,068		5,485		46,714		52,199		-
Personal loans		196		7		91		294		3,681		3,975		-
		2,413		1,207		2,159		5,779		50,395		56,174		-
Auto		12,534		3,616		1,608		17,758		283,826		301,584		-
Total	$	17,144	$	6,848	$	5,413	$	29,405	$	406,034	$	435,439	$	-

21

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Acquired Loans Accounted for under ASC 310-30 (including those accounted for under ASC 310-30 by analogy)

Loans acquired as part of the non-covered portfolio, except for credit cards, retail and commercial revolving lines of credits, floor plans and performing auto loans with FICO scores over 660 acquired at a premium, are accounted for by the Company in accordance with ASC 310-30.

The carrying amount corresponding to non-covered loans acquired with deteriorated credit quality, including those accounted under ASC 310-30 by analogy, in the statements of financial condition at March 31, 2014 and December 31, 2013 is as follows:

	March 31,	December 31,
	2014	2013
	(In thousands)
Contractual required payments receivable	$ 2,799,336	$ 2,929,353
Less: Non-accretable discount	563,294	579,587
Cash expected to be collected	2,236,042	2,349,766
Less: Accretable yield	482,001	517,553
Carrying amount	$ 1,754,041	$ 1,832,213

At March 31, 2014 and December 31, 2013, the Company had $196.1 million and $180.5 million, respectively, in loans granted to the Puerto Rico government, including its instrumentalities, public corporations and municipalities as part of its non-covered acquired loans accounted for under ASC 310-30.

The following tables describe the accretable yield and non-accretable discount activity of acquired loans accounted for under ASC 310-30 for the quarters ended March 31, 2014 and 2013, excluding covered loans:

	Quarter Ended March 31,
	2014		2013
Accretable Yield Activity
Balance at beginning of period	$	517,553	$	655,833
Accretion		(40,269)		(47,668)
Transfer from non-accretable discount		4,717		-
Balance at end of period	$	482,001	$	608,165
	Quarter Ended March 31,
	2014		2013
Non-Accretable Discount Activity
Balance at beginning of period	$	579,587	$	714,462
Principal losses		(11,576)		(8,746)
Transfer to accretable yield		(4,717)		-
Balance at end of period	$	563,294	$	705,716

22

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Covered Loans

The carrying amount of covered loans at March 31, 2014 and December 31, 2013 is as follows:

	March 31,		December 31,
	2014		2013
	(In thousands)
Contractual required payments receivable	$	657,353	$	702,126
Less: Non-accretable discount		107,323		129,477
Cash expected to be collected		550,030		572,649
Less: Accretable yield		147,767		162,959
Carrying amount, gross		402,263		409,690
Less: Allowance for covered loan and lease losses		54,398		52,729
Carrying amount, net	$	347,865	$	356,961

The following tables describe the accretable yield and non-accretable discount activity of covered loans for the quarters ended March 31, 2014 and 2013:

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Accretable yield activity
Balance at beginning of period	$	162,959	$	188,008
Accretion		(23,388)		(20,229)
Transfer from non-accretable discount		8,196		6,328
Balance at end of period	$	147,767	$	174,107
	Quarter Ended March 31,
	2014		2013
	(In thousands)
Non-accretable discount activity
Balance at beginning of period	$	129,477	$	237,555
Principal losses		(13,958)		(16,991)
Transfer to accretable yield		(8,196)		(6,328)
Balance at end of period	$	107,323	$	214,236

23

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Non-accrual Loans

The following table presents the recorded investment in loans in non-accrual status by class of loans as of March 31, 2014 and December 31, 2013:

	March 31,		December 31,
	2014		2013
	(In thousands)
Originated and other loans and leases held for investment
Mortgage
Traditional (by origination year):
Up to the year 2002	$	2,884	$	3,428
Years 2003 and 2004		2,359		1,845
Year 2005		6,667		4,922
Year 2006		4,555		4,418
Years 2007, 2008 and 2009		4,943		4,511
Years 2010, 2011, 2012, 2013 and 2014		8,342		7,818
		29,750		26,942
Non-traditional		2,425		2,311
Loss mitigation program		16,903		18,792
		49,078		48,045
Home equity secured personal loans		138		138
		49,216		48,183
Commercial
Commercial secured by real estate
Middle market		11,596		11,895
Retail		8,760		7,208
		20,356		19,103
Other commercial and industrial
Middle market		513		1,134
Retail		2,923		2,485
Floor plan		-		108
		3,436		3,727
		23,792		22,830
Consumer
Credit cards		354		232
Overdrafts		4		-
Personal lines of credit		161		84
Personal loans		547		485
Cash collateral personal loans		18		4
		1,084		805
Auto and leasing		6,047		5,089
	$	80,139	$	76,907

24

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

	March 31,		December 31,
	2014		2013
	(In thousands)
Acquired loans accounted under ASC 310-20
Commercial
Commercial secured by real estate
Retail	$	688	$	956
Floor plan		101		101
		789		1,057
Other commercial and industrial
Corporate		96		97
Retail		851		1,371
Floor plan		126		18
		1,073		1,486
		1,862		2,543
Consumer
Credit cards		2,076		2,068
Personal loans		58		151
		2,134		2,219
Auto		1,515		1,608
		5,511		6,370
Total non-accrual loans	$	85,650	$	83,277

Loans accounted for under ASC 310-30 are excluded from the above table as they are considered to be performing due to the application of the accretion method, in which these loans will accrete interest income over the remaining life of the loans using estimated cash flow analyses.

Effective April 24, 2013, delinquent residential mortgage loans insured or guaranteed under applicable FHA and VA programs are placed in non-accrual when they become 18 months or more past due, since they are insured loans. Before that date, they were placed in non-accrual when they became 90 days or more past due.

At March 31, 2014 and December 31, 2013, loans whose terms have been extended and which are classified as troubled-debt restructurings that are not included in non-accrual loans amounted to $70.8 million and $66.5 million, respectively, as they are performing under their new terms.

25

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

NOTE 5 – ALLOWANCE FOR LOAN AND LEASE LOSSES

The composition of the Company’s allowance for loan and lease losses at March 31, 2014 and December 31, 2013 was as follows:

	March 31,		December 31,
	2014		2013
	(In thousands)
Allowance for loans and lease losses on non-covered loans:
Originated and other loans and leases held for investment:
Mortgage	$	19,511	$	19,937
Commercial		13,994		14,897
Consumer		7,135		6,006
Auto and leasing		8,731		7,866
Unallocated		136		375
		49,507		49,081
Acquired loans:
Accounted for under ASC 310-20 (Loans with revolving feature and/or
acquired at a premium)
Commercial		867		926
Consumer		504		-
Auto		2,247		1,428
		3,618		2,354
Accounted for under ASC 310-30 (Loans acquired with deteriorated
credit quality, including those by analogy)
Commercial		2,653		1,713
Consumer		405		418
Auto		-		732
		3,058		2,863
		56,183		54,298
Allowance for loans and lease losses on covered loans:
Loans secured by 1-4 family residential properties		14,221		12,495
Commercial and other construction		39,562		39,619
Consumer		615		615
		54,398		52,729
Total allowance for loan and lease losses	$	110,581	$	107,027

Non-Covered Loans

The Company maintains an allowance for loan and lease losses at a level that management considers adequate to provide for probable losses based upon an evaluation of known and inherent risks. The Company’s allowance for loan and lease losses policy provides for a detailed quarterly analysis of probable losses. The analysis includes a review of historical loan loss experience, value of underlying collateral, current economic conditions, financial condition of borrowers and other pertinent factors. While management uses available information in estimating probable loan losses, future additions to the allowance may be required based on factors beyond the Company’s control. We also maintain an allowance for loan losses on acquired loans when: (i) for loans accounted for under ASC 310-30, there is deterioration in credit quality subsequent to acquisition, and (ii) for loans accounted for under ASC 310-20, the inherent losses in the loans exceed the remaining credit discount recorded at the time of acquisition. As part of the Company’s continuous enhancement to the allowance for loan and lease losses methodology, during the quarter ended March 31, 2014, an assessment of the look-back period and historical loss factor was performed for auto and leasing and consumer loan portfolios based on the trends observed and their relation with the economic cycle as of the period ended March 31, 2014. As a result, the period was changed to 24 months from the previously determined 12 months. This change in the allowance for loan and lease losses’ look back period for the consumer and auto and leasing portfolios is considered a change in accounting estimate as per ASC 250-10 provisions, where adjustments should be made prospectively.  

26

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Originated and Other Loans and Leases Held for Investment

The following tables present the activity in our allowance for loan and lease losses and the related recorded investment of the associated loans for our originated and other loans held for investment portfolio by segment for the periods indicated:

	Quarter Ended March 31, 2014
							Auto and
	Mortgage		Commercial		Consumer		Leasing		Unallocated		Total
	(In thousands)
Allowance for loan and lease losses for non-covered originated and other loans:
Balance at beginning of period	$	19,937	$	14,897	$	6,006	$	7,866	$	375	$	49,081
Charge-offs		(1,214)		(419)		(838)		(4,645)		-		(7,116)
Recoveries		148		98		147		1,524		-		1,917
Provision for non-covered originated             and other loan and lease losses		640		(582)		1,820		3,986		(239)		5,625
Balance at end of period	$	19,511	$	13,994	$	7,135	$	8,731	$	136	$	49,507

	March 31, 2014
	Mortgage		Commercial		Consumer		Auto and Leasing		Unallocated		Total
	(In thousands)
Allowance for loan and lease losses on non-covered originated and other loans:
Ending allowance balance attributable       to loans:
Individually evaluated for impairment	$	8,001	$	1,704	$	-	$	-	$	-	$	9,705
Collectively evaluated for impairment		11,510		12,290		7,135		8,731		136		39,802
Total ending allowance balance	$	19,511	$	13,994	$	7,135	$	8,731	$	136	$	49,507
Loans:
Individually evaluated for impairment	$	87,744	$	27,767	$	-	$	-	$	-	$	115,511
Collectively evaluated for impairment		694,406		1,142,378		142,492		447,940		-		2,427,216
Total ending loan balance	$	782,150	$	1,170,145	$	142,492	$	447,940	$	-	$	2,542,727

27

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

	Quarter Ended March 31, 2013
	Mortgage		Commercial		Consumer		Auto and Leasing		Unallocated		Total
	(In thousands)
Allowance for loan and lease losses for non-covered originated and other loans:
Balance at beginning of period	$	21,092	$	17,072	$	856	$	533	$	368	$	39,921
Charge-offs		(2,588)		(557)		(246)		(91)		-		(3,482)
Recoveries		-		28		65		7		-		100
Provision for (recapture of) non-covered             originated and other loan and lease losses		4,385		(229)		638		1,292		(291)		5,795
Balance at end of period	$	22,889	$	16,314	$	1,313	$	1,741	$	77	$	42,334

	December 31, 2013
	Mortgage		Commercial		Consumer		Auto and Leasing		Unallocated		Total
	(In thousands)
Allowance for loan and lease losses for non-covered originated and other loans:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	8,708	$	1,431	$	-	$	-	$	-	$	10,139
Collectively evaluated for impairment		11,229		13,466		6,006		7,866		375		38,942
Total ending allowance balance	$	19,937	$	14,897	$	6,006	$	7,866	$	375	$	49,081
Loans:
Individually evaluated for impairment	$	84,494	$	28,145	$	-	$	-	$	-	$	112,639
Collectively evaluated for impairment		681,771		1,099,512		127,744		379,874		-		2,288,901
Total ending loans balance	$	766,265	$	1,127,657	$	127,744	$	379,874	$	-	$	2,401,540

28

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Acquired Loans Accounted for under ASC 310-20 (Loans with revolving feature and/or acquired at a premium)

The following tables present the activity in our allowance for loan losses and related recorded investment of the associated loans in our non-covered acquired loan portfolio, excluding loans accounted for under ASC 310-30, for the quarter ended March 31, 2014:

	Quarter Ended March 31, 2014
	Commercial			Consumer		Auto		Unallocated		Total
Allowance for loan and lease losses     for non-covered acquired loans      accounted for under ASC 310-20:
Balance at beginning of period	$	926	$ 1	$	-	$	1,428	$	-	$	2,354
Charge-offs		(174)			(2,058)		(1,296)		-		(3,528)
Recoveries		-			100		450		-		550
Provision for non-covered acquired             loan and lease losses accounted for             under ASC 310-20		115			2,462		1,665		-		4,242
Balance at end of period	$	867		$	504	$	2,247	$	-	$	3,618

	March 31, 2014
	Commercial		Consumer		Auto		Unallocated		Total
Allowance for loan and lease losses on non-covered acquired loans accounted for under ASC 310-20:
Ending allowance balance attributable       to loans:
Collectively evaluated for impairment		867		504		2,247		-		3,618
Total ending allowance balance	$	867	$	504	$	2,247	$	-	$	3,618
Loans:
Collectively evaluated for impairment		71,577		52,049		268,865		-		392,491
Total ending loan balance	$	71,577	$	52,049	$	268,865	$	-	$	392,491

	Quarter Ended March 31, 2013
	Commercial			Consumer		Auto		Unallocated		Total
Allowance for loan and lease losses     for non-covered acquired loans      accounted for under ASC 310-20:
Balance at beginning of period	$	-	$ 1	$	-	$	-	$	-	$	-
Charge-offs		-			(1,456)		(1,715)		-		(3,171)
Recoveries		-			207		1,230		-		1,437
Provision for non-covered acquired             loan and lease losses accounted for             under ASC 310-20		386			1,249		485		-		2,120
Balance at end of period	$	386		$	-	$	-	$	-	$	386

29

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

	December 31, 2013
	Commercial		Consumer		Auto		Unallocated		Total
Allowance for loan and lease losses on non-covered acquired loans accounted for under ASC 310-20:
Ending allowance balance attributable       to loans:
Collectively evaluated for impairment		926		-		1,428		-		2,354
Total ending allowance balance	$	926	$	-	$	1,428	$	-	$	2,354
Loans:
Collectively evaluated for impairment		77,681		56,174		301,584		-		435,439
Total ending loan balance	$	77,681	$	56,174	$	301,584	$	-	$	435,439

Acquired Loans Accounted for under ASC 310-30 (including those accounted for under ASC 310-30 by analogy)

The following tables present the activity in our allowance for loan losses and related recorded investment of the associated loans in our non-covered acquired loan portfolio accounted for under ASC 310-30, for the quarter ended March 31, 2014:

	Quarter Ended March 31, 2014
	Mortgage			Commercial			Construction			Consumer		Auto		Total
Allowance for loan and lease losses for non-covered loans accounted for under ASC 310-30:
Balance at beginning of period	$	-	$ 1	$	1,713	$ 1	$	-	$ 1	$	418	$	732	$	2,863
Provision for non-covered acquired             loan and lease losses accounted for             under ASC 310-30		-			940			-			(13)		(732)		195
Balance at end of period	$	-		$	2,653		$	-		$	405	$	-	$	3,058

Non-covered loans acquired accounted for under ASC 310-30 were recognized at fair value as of December 18, 2012, which included the impact of expected credit losses and, therefore, no allowance for credit losses was recorded during the quarter ended March 31, 2013.

30

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Impaired Loans

The Company evaluates all loans, some individually and others as homogeneous groups, for purposes of determining impairment. The total investment in impaired commercial loans was $27.8 million and $28.1 million at March 31, 2014 and December 31, 2013, respectively. The impaired commercial loans were measured based on the fair value of collateral or the present value of cash flows, including those identified as troubled-debt restructurings. The valuation allowance for impaired commercial loans amounted to approximately $1.4 million at March 31, 2014 and December 31, 2013. The total investment in impaired mortgage loans was $87.7 million and $84.5 million at March 31, 2014 and December 31, 2013, respectively. Impairment on mortgage loans assessed as troubled-debt restructurings was measured using the present value of cash flows. The valuation allowance for impaired mortgage loans amounted to approximately $8.0 million and $8.7 million at March 31, 2014 and December 31, 2013, respectively.

The Company’s recorded investment in commercial and mortgage loans that were individually evaluated for impairment, excluding loans accounted for under ASC 310-30, and the related allowance for loan and lease losses at March 31, 2014 and December 31, 2013 are as follows:

Originated and Other Loans and Leases Held for Investment

	March 31, 2014
	Unpaid		Recorded		Related
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired loans with specific allowance:
Commercial	$	7,856	$	6,686	$	1,704	25%
Residential troubled-debt restructuring		92,870		87,744		8,002	9%
Impaired loans with no specific allowance:
Commercial		26,744		21,081		N/A	N/A
Total investment in impaired loans	$	127,470	$	115,511	$	9,706	8%

	December 31, 2013
	Unpaid		Recorded		Related
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired loans with specific allowance
Commercial	$	6,600	$	5,553	$	1,431	26%
Residential troubled-debt restructuring		89,539		84,494		8,708	10%
Impaired loans with no specific allowance
Commercial		27,914		22,592		N/A	N/A
Total investment in impaired loans	$	124,053	$	112,639	$	10,139	9%

31

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Acquired Loans Accounted for under ASC-310-20 (Loans with revolving feature and/or acquired at a premium)
	March 31, 2014
	Unpaid		Recorded		Related
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired loans with no specific allowance
Commercial		208		208		N/A	N/A
Total investment in impaired loans	$	208	$	208	$	-	0%
	December 31, 2013
	Unpaid		Recorded		Specific
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired loans with no specific allowance
Commercial		208		208		N/A	N/A
Total investment in impaired loans	$	208	$	208	$	-	0%

Acquired Loans Accounted for under ASC 310-30 (including those accounted for under ASC 310-30 by analogy)

The Company’s recorded investment in non-covered acquired loan pools accounted for under ASC 310-30 and their related allowance for non-covered loan and lease losses at March 31, 2014 and December 31, 2013 are as follows:

	March 31, 2014
	Unpaid		Recorded
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired non-covered loan pools:
Mortgage	$	5,008	$	4,510	$	57	1%
Commercial		89,496		78,742		879	1%
Construction		46,256		40,397		1,773	4%
Consumer		61,584		53,307		349	1%
Total investment in impaired non-covered loan pools	$	202,344	$	176,956	$	3,058	2%

	December 31, 2013
	Unpaid		Recorded
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired non-covered loan pools:
Mortgage	$	5,183	$	4,718	$	57	1%
Commercial		48,100		40,411		394	1%
Construction		21,526		17,818		1,319	7%
Consumer		73,043		63,606		361	1%
Auto		379,236		377,316		732	0%
Total investment in impaired non-covered loan pools	$	527,088	$	503,869	$	2,863	1%

32

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following table presents the interest recognized in commercial and mortgage loans that were individually evaluated for impairment, excluding loans accounted for under ASC 310-30, for the quarters ended March 31, 2014 and 2013:

	Quarter Ended March 31,
	2014				2013
	Interest Income Recognized		Average Recorded Investment		Interest Income Recognized		Average Recorded Investment
	(In thousands)
Impaired loans with specific allowance
Commercial	$	24	$	6,259	$	4	$	15,472
Residential troubled-debt restructuring		645		87,052		443		78,748
Impaired loans with no specific allowance
Commercial		78		21,629		293		30,360
Total interest income from impaired loans	$	747	$	114,940	$	740	$	124,580

Modifications

The following table presents the troubled-debt restructurings during the quarters ended March 31, 2014 and 2013:

	Quarter Ended March 31, 2014
	Number of contracts	Pre-Modification Outstanding Recorded Investment		Pre-Modification Weighted Average Rate	Pre-Modification Weighted Average Term (in Months)	Post-Modification Outstanding Recorded Investment		Post-Modification Weighted Average Rate	Post-Modification Weighted Average Term (in Months)
	(Dollars in thousands)
Mortgage	34	$	4,009	6.43%	347	$	3,910	4.35%	375
Consumer	5		42	12.97%	67		44	12.95%	66
	Quarter Ended March 31, 2013
	Number of contracts	Pre- Modification Outstanding Recorded Investment		Pre-Modification Weighted Average Rate	Pre-Modification Weighted Average Term (in Months)	Post-Modification Outstanding Recorded Investment		Post-Modification Weighted Average Rate	Post-Modification Weighted Average Term (in Months)
	(Dollars in thousands)
Mortgage	57	$	7,518	6.28%	331	$	8,040	4.35%	409

33

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following table presents troubled-debt restructurings for which there was a payment default during the twelve-month period ended March 31, 2014 and 2013:

	Twelve-Month Period Ended March 31,
	2014			2013
	Number of Contracts	Recorded Investment		Number of Contracts	Recorded Investment
	(Dollars in thousands)
Mortgage	19	$	2,592	32	$	4,295
Commercial	-	$	-	1	$	18
Consumer	1	$	11	-	$	-

Credit Quality Indicators

The Company categorizes non-covered originated and acquired loans accounted for under ASC 310-20 into risk categories based on relevant information about the ability of borrowers to service their debt, such as economic conditions, portfolio risk characteristics, prior loss experience, and the results of periodic credit reviews of individual loans.

The Company uses the following definitions for risk ratings:

Special Mention: Loans classified as “special mention” have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date.

Substandard: Loans classified as “substandard” are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful: Loans classified as “doubtful” have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, questionable and improbable.

Loss: Loans classified as “loss” are considered uncollectible and of such little value that their continuance as bankable assets is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather that it is not practical or desirable to defer writing off this worthless loan even though partial recovery may be effected in the future.

Loans not meeting the criteria above that are analyzed individually as part of the above described process are considered to be pass rated loans.

34

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

As of March 31, 2014 and December 31, 2013, and based on the most recent analysis performed, the risk category of gross non-covered originated and other loans and acquired loans accounted for under ASC 310-20 subject to risk rating by class of loans is as follows:

	March 31, 2014
	Risk Ratings
											Individually
	Balance				Special						Measured for
	Outstanding		Pass		Mention		Substandard		Doubtful		Impairment
	(In thousands)
Commercial - originated and other loans held for investment
Commercial secured by real estate:
Corporate	$	62,935	$	62,935	$	-	$	-	$	-	$	-
Institutional		9,833		9,833		-		-		-		-
Middle market		169,753		141,537		16,619		-		-		11,597
Retail		156,694		139,971		1,929		1,892		-		12,902
Floor plan		1,699		1,699		-		-		-		-
Real estate		11,837		11,837		-		-		-		-
		412,751		367,812		18,548		1,892		-		24,499
Other commercial and industrial:
Corporate		28,475		28,475		-		-		-		-
Institutional		553,249		553,249		-		-		-		-
Middle market		82,933		77,566		3,336		771		-		1,260
Retail		67,055		63,366		119		1,562		-		2,008
Floor plan		25,682		25,372		202		108		-		-
		757,394		748,028		3,657		2,441		-		3,268
Total		1,170,145		1,115,840		22,205		4,333		-		27,767
Commercial - acquired loans       (under ASC 310-20)
Commercial secured by real estate:
Corporate		11,079		11,079		-		-		-		-
Retail		4,301		3,490		245		566		-		-
Floor plan		2,752		2,651		-		101		-		-
		18,132		17,220		245		667		-		-
Other commercial and industrial:
Corporate		2,947		2,851		-		96		-		-
Institutional		221		221		-		-		-		-
Retail		17,216		16,460		100		656		-		-
Floor plan		33,061		32,998		63		-		-		-
		53,445		52,530		163		752		-		-
Total		71,577		69,750		408		1,419		-		-
Total	$	1,241,722	$	1,185,590	$	22,613	$	5,752	$	-	$	27,767

35

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

	December 31, 2013
	Risk Ratings
											Individually
	Balance				Special						Measured for
	Outstanding		Pass		Mention		Substandard		Doubtful		Impairment
	(In thousands)
Commercial - originated and other loans held for investment
Commercial secured by real estate:
Corporate	$	54,796	$	54,796	$	-	$	-	$	-	$	-
Institutional		4,050		4,050		-		-		-		-
Middle market		161,583		133,061		16,627		118		-		11,777
Retail		166,642		149,018		2,182		2,258		-		13,184
Floor plan		1,835		1,835		-		-		-		-
Real estate		11,655		11,655		-		-		-		-
		400,561		354,415		18,809		2,376		-		24,961
Other commercial and industrial:
Corporate		32,598		32,598		-		-		-		-
Institutional		536,445		536,445		-		-		-		-
Middle market		58,897		53,868		3,466		198		-		1,365
Retail		61,510		58,742		257		691		-		1,820
Floor plan		37,646		37,350		188		108		-		-
		727,096		719,003		3,911		997		-		3,185
Total		1,127,657		1,073,418		22,720		3,373		-		28,146
Commercial - acquired loans       (under ASC 310-20)
Commercial secured by real estate:
Corporate		10,166		10,166		-		-		-		-
Retail		5,770		4,378		443		949		-		-
Floor plan		2,677		2,576		-		101		-		-
		18,613		17,120		443		1,050		-		-
Other commercial and industrial:
Corporate		9,793		9,696		-		97		-		-
Retail		27,338		26,044		150		1,144		-		-
Floor plan		21,937		21,769		168		-		-		-
		59,068		57,509		318		1,241		-		-
Total		77,681		74,629		761		2,291		-		-
Total	$	1,205,338	$	1,148,047	$	23,481	$	5,664	$	-	$	28,146

At March 31, 2014 and December 31, 2013, we had approximately $766.7 million and $763.4 million, respectively, of credit facilities granted to the Puerto Rico government, including its instrumentalities, public corporations and municipalities, of which $718.8 million and $696.0, respectively, were outstanding as of such dates. A substantial portion of our credit exposure to the government of Puerto Rico consists of collateralized loans or obligations that have a specific source of income or revenues identified for its repayment. Some of these obligations consist of senior and subordinated loans to public corporations that obtain revenues from rates charged for services, such as water and electric power utilities. Public corporations have varying degrees of independence from the central government and many receive appropriations or other payments from it. We also have loans to various municipalities for which the good faith, credit and unlimited taxing power of the applicable municipality has been pledged to their repayment. These municipalities are required by law to levy special property taxes in such amounts as shall be required for the payment of all their general obligation bonds and notes. Another portion of these loans consists of special obligations of various municipalities that are payable from the basic real and personal property taxes collected within such municipalities. The good faith and credit obligations of the municipalities have a first lien on the basic property taxes.

36

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

For residential and consumer loan classes, the Company evaluates credit quality based on the delinquency status of the loan. As of March 31, 2014 and December 31, 2013, and based on the most recent analysis performed, the risk category of non-covered gross originated and other loans and acquired loans accounted for under ASC 310-20 not subject to risk rating by class of loans is as follows:

	March 31, 2014
	Delinquency
																Individually
	Balance															Measured for
	Outstanding		0-29 days		30-59 days		60-89 days			90-119 days		120-364 days		365+ days		Impairment
	(In thousands)
Originated and other loans and leases held for investment
Mortgage
Traditional         (by origination year)
Up to the year 2002	$	72,096	$	61,268	$	5,230	$	2,621		$	382	$	1,037	$	1,459	$	99
Years 2003 and 2004		63,515		53,170		5,494		2,445			484		1,246		612		64
Year 2005		87,818		72,414		6,448		2,288			1,233		3,576		1,324		535
Year 2006		116,904		97,822		10,151		4,376			1,169		2,410		850		126
Years 2007, 2008             and 2009		97,840		87,065		3,807		2,025			223		3,619		875		226
Years 2010, 2011, 2012             2013 and 2014		182,167		164,134		2,126		721			1,070		1,004		1,064		12,048
		620,340		535,873		33,256		14,476			4,561		12,892		6,184		13,098
Non-traditional		39,790		35,078		1,744		470			-		1,439		986		73
Loss mitigation program		86,005		8,366		1,001		171			219		779		896		74,573
		746,135		579,317		36,001		15,117			4,780		15,110		8,066		87,744
Home equity secured         personal loans		733		595		-		-	-		-		126		12		-
GNMA's buy-back         option program		35,282		-		-		-	-		5,529		16,742		13,011		-
		782,150		579,912		36,001		15,117			10,309		31,978		21,089		87,744
Consumer
Credit cards		15,490		14,701		263		171			136		219		-		-
Overdrafts		331		289		28		11			1		2		-		-
Unsecured personal lines of credit		1,934		1,718		60		99			15		35		7		-
Unsecured personal loans		108,037		105,369		1,397		512			195		42		12		510
Cash collateral personal loans		16,700		16,263		375		46			13		3		-		-
		142,492		138,340		2,123		839			360		301		19		510
Auto and Leasing		447,940		399,721		33,788		8,559			3,461		2,411		-		-
		1,372,582		1,117,973		71,912		24,515			14,130		34,690		21,108		88,254
Acquired loans (accounted for under ASC 310-20)
Consumer
Credit cards		48,381		44,111		1,413		781			743		1,333		-		-
Personal loans		3,668		3,423		105		83			4		53		-		-
		52,049		47,534		1,518		864			747		1,386		-		-
Auto		268,865		250,840		13,161		3,522			804		538		-		-
		320,914		298,374		14,679		4,386			1,551		1,924		-		-
Total	$	1,693,496	$	1,416,347	$	86,591	$	28,901		$	15,681	$	36,614	$	21,108	$	88,254

37

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

	December 31, 2013
	Delinquency
																Individually
	Balance															Measured for
	Outstanding		0-29 days		30-59 days		60-89 days			90-119 days		120-364 days		365+ days		Impairment
	(In thousands)
Originated and other loans and leases held for investment
Mortgage
Traditional         (by origination year)
Up to the year 2002	$	76,512	$	64,743	$	6,594	$	1,634		$	868	$	1,082	$	1,458	$	133
Years 2003 and 2004		65,117		56,283		4,722		1,938			56		1,437		352		329
Year 2005		89,541		74,016		8,414		2,119			1,198		3,037		573		184
Year 2006		120,322		99,243		12,055		4,312			1,148		2,755		515		294
Years 2007, 2008             and 2009		101,150		91,920		3,464		1,104			1,264		2,844		554		-
Years 2010, 2011,             2012 and 2013		149,546		134,577		3,192		1,609			115		974		989		8,090
		602,188		520,782		38,441		12,716			4,649		12,129		4,441		9,030
Non-traditional		42,102		35,168		3,217		1,162			-		1,324		833		398
Loss mitigation program		86,318		7,762		1,376		149			624		312		1,029		75,066
		730,608		563,712		43,034		14,027			5,273		13,765		6,303		84,494
Home equity secured         personal loans		736		598		-		-	-		-		126		12		-
GNMA's buy-back         option program		34,921		-		-		-	-		7,670		14,425		12,826		-
		766,265		564,310		43,034		14,027			12,943		28,316		19,141		84,494
Consumer
Credit cards		15,241		14,555		287		168			118		113		-		-
Overdrafts		372		322		46		4			-		-		-		-
Unsecured personal lines of credit		1,981		1,844		33		38			25		34		7		-
Unsecured personal loans		94,560		92,102		1,272		399			300		39		13		435
Cash collateral personal loans		15,590		15,223		324		43			-		-		-		-
		127,744		124,046		1,962		652			443		186		20		435
Auto and Leasing		379,874		339,817		25,532		9,437			3,397		1,691		-		-
		1,273,883		1,028,173		70,528		24,116			16,783		30,193		19,161		84,929
Acquired loans (accounted for under ASC 310-20)
Consumer
Credit cards		52,199		46,713		2,217		1,200			828		1,241		-		-
Personal loans		3,975		3,681		196		7			60		31		-		-
		56,174		50,394		2,413		1,207			888		1,272		-		-
Auto		301,584		283,825		12,534		3,616			1,095		514		-		-
		357,758		334,219		14,947		4,823			1,983		1,786		-		-
Total	$	1,631,641	$	1,362,392	$	85,475	$	28,939		$	18,766	$	31,979	$	19,161	$	84,929

38

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Covered Loans

For covered loans, as part of the evaluation of actual versus expected cash flows, the Company assesses on a quarterly basis the credit quality of these loans based on delinquency, severity factors and risk ratings, among other assumptions. Migration and credit quality trends are assessed at the pool level, by comparing information from the latest evaluation period through the end of the reporting period.

The changes in the allowance for loan and lease losses on covered loans for the quarters ended March 31, 2014 and 2013 were as follows:

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Balance at beginning of the period	$	52,729	$	54,124
Provision for covered loan and lease losses, net		1,629		672
FDIC shared-loss portion of provision for (recapture of)
covered loan and lease losses, net		40		(1,822)
Balance at end of the period	$	54,398	$	52,974

FDIC shared-loss portion of provision for (recapture of) covered loans and lease losses net, represents the credit impairment losses to be covered under the FDIC loss-share agreement which is increasing (decreasing) the FDIC loss-share indemnification asset.

Net provision for covered loans includes both additional reserves and reserve releases for different pools. The pools for which there were releases are also subject to a reduction to the FDIC shared-loss indemnification asset because of lower expected losses which are recognized as recaptures.

The Company’s recorded investment in covered loan pools that have recorded impairments and their related allowance for covered loan and lease losses as of March 31, 2014 and December 31, 2013 are as follows:

	March 31, 2014
	Unpaid		Recorded
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired covered loan pools:
Loans secured by 1-4 family residential properties	$	147,597	$	111,410	$	14,221	13%
Construction and development secured by 1-4 family             residential properties		65,747		18,254		6,866	38%
Commercial and other construction		192,095		111,679		32,696	29%
Consumer		9,671		5,503		615	11%
Total investment in impaired covered loan pools	$	415,110	$	246,846	$	54,398	22%

	December 31, 2013
	Unpaid		Recorded		Specific
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired covered loan pools with specific allowance
Loans secured by 1-4 family residential properties	$	52,142	$	38,179	$	12,495	33%
Construction and development secured by 1-4 family             residential properties		66,037		17,304		6,866	40%
Commercial and other construction		209,566		111,946		32,753	29%
Consumer		10,512		5,857		615	11%
Total investment in impaired covered loan pools	$	338,257	$	173,286	$	52,729	30%

39

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

NOTE 6- FDIC LOSS SHARE ASSET AND TRUE-UP PAYMENT OBLIGATION

As part of the Purchase and Assumption Agreement between the Bank and the FDIC (the “Purchase and Assumption Agreement”), the Bank and the FDIC entered into shared-loss agreements whereby the FDIC in connection with the Eurobank acquisition, covers a substantial portion of any losses on loans (and related unfunded loan commitments), foreclosed real estate and other repossessed properties.

The acquired loans, foreclosed real estate, and other repossessed properties subject to the shared-loss agreements are collectively referred to as “covered assets.” Under the terms of the shared-loss agreements, the FDIC absorbs 80% of losses and shares in 80% of loss recoveries on covered assets. The term of the shared-loss agreement covering single family residential mortgage loans is ten years with respect to losses and loss recoveries, while the term of the shared-loss agreement covering commercial loans is five years with respect to losses and eight years with respect to loss recoveries, from the April 30, 2010 acquisition date. The shared-loss agreements also provide for certain costs directly related to the collection and preservation of covered assets to be reimbursed at an 80% level. The indemnification asset represents the portion of estimated losses covered by the shared-loss agreements between the Bank and the FDIC.

The following table presents the activity in the FDIC loss share asset and true-up payment obligation for the quarters ended March 31, 2014 and 2013:

	Quarter Ended March 31,
	2014		2013
	(In thousands)
FDIC share-loss indemnification asset:
Balance at beginning of period	$	189,240	$	302,295
Shared-loss agreements reimbursements from the FDIC		(8,236)		(6,650)
Increase (decrease) in expected credit losses to be       covered under shared-loss agreements, net		40		(1,822)
FDIC shared-loss expense		(17,622)		(12,201)
Incurred expenses to be reimbursed under shared-loss agreements		2,772		1,502
Balance at end of period	$	166,194	$	283,124
True-up payment obligation:
Balance at beginning of period	$	18,510	$	15,496
FDIC shared-loss expense		865		670
Balance at end of period	$	19,375	$	16,166

The FDIC shared-loss expense increased as the Company continues to forecast better performance and cash flows from covered loans than previously expected resulting in a minor increase in the amortization of the FDIC shared-loss indemnification asset.

The FDIC shared-loss expense of $18.5 million for the quarter ended March 31, 2014 compared to $12.9 million for the same period in 2013, resulted from the ongoing evaluation of expected cash flows of the covered loan portfolio, which resulted in reduced projected losses expected to be collected from the FDIC and the improved accretable yield on the covered loans. Forecasted losses show a decreasing trend during the quarter ended March 31, 2014 as compared to the projections in 2013.The reduction in claimable losses amortizes the shared-loss indemnification asset through the shorter of the life of the shared loss agreement or the loan holding period. This amortization is net of the accretion of the discount recorded to reflect the expected claimable loss at its net present value. During the quarter ended March 31, 2014, the net amortization included $3.5 million of additional amortization of the FDIC indemnification asset from stepped up cost recoveries on certain construction, commercial, and leasing loan pools. Additional amortization of the FDIC indemnification asset may be recorded, should the Company continue to experience reduced expected losses. The majority of the FDIC indemnification asset is recorded for projected claimable losses on non-single family residential loans whose loss share period ends in the second quarter of 2015, although the recovery share period extends for an additional three-year period.

40

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The Bank agreed to make a true-up payment, also known as clawback liability or clawback provision, to the FDIC on the date that is 45 days following the last day (such day, the “True-Up Measurement Date”) of the final shared-loss month, or upon the final disposition of all covered assets under the shared-loss agreements in the event losses thereunder fail to reach expected levels. Under the shared-loss agreements, the Bank will pay to the FDIC 50% of the excess, if any, of: (i) 20% of the Intrinsic Loss Estimate of $906.0 million (or $181.2 million) (as determined by the FDIC) less (ii) the sum of: (A) 25% of the asset discount (per bid) (or $227.5 million); plus (B) 25% of the cumulative shared-loss payments (defined as the aggregate of all of the payments made or payable to the Bank minus the aggregate of all of the payments made or payable to the FDIC); plus (C) the sum of the period servicing amounts for every consecutive twelve-month period prior to and ending on the True-Up Measurement Date in respect of each of the shared-loss agreements during which the shared-loss provisions of the applicable shared-loss agreement is in effect (defined as the product of the simple average of the principal amount of shared-loss loans and shared-loss assets at the beginning and end of such period times 1%). The true-up payment represents an estimated liability of $19.4 million and $18.5 million, net of discount, as of March 31, 2014 and December 31, 2013, respectively. The estimated liability is included within other liabilities in the unaudited consolidated statements of financial condition.

NOTE 7 —  DERIVATIVE ACTIVITIES

During the quarter ended March 31, 2014, losses of $478 thousand were recognized and reflected as “Derivative Activities” in the unaudited consolidated statements of operations, which were mainly related to the options tied to the Standard & Poor’s 500 stock market index. During the quarter ended March 31, 2013, losses of $788 thousand were recognized and were mainly related to the options tied to the Standard & Poor’s 500 stock market index

The following table details “Derivative Assets” and “Derivative Liabilities” as reflected in the unaudited consolidated statements of financial condition at March 31, 2014 and December 31, 2013:

	March 31,		December 31,
	2014		2013
	(In thousands)
Derivative assets:
Options tied to S&P 500 Index	$	12,555	$	16,430
Interest rate swaps designated as cash flow hedges		166		850
Interest rate swaps not designated as hedges		2,755		2,861
Interest rate caps		374		319
Other		11		42
	$	15,861	$	20,502
Derivative liabilities:
Interest rate swaps designated as cash flow hedges		10,695		11,757
Interest rate swaps not designated as hedges		2,755		2,861
Interest rate caps		374		319
Other		6		-
	$	13,830	$	14,937

Interest Rate Swaps

The Company enters into interest rate swap contracts to hedge the variability of future interest cash flows of forecasted wholesale borrowings, attributable to changes in a predetermined variable index rate. The interest rate swaps effectively fix the Company’s interest payments on an amount of forecasted interest expense attributable to the variable index rate corresponding to the swap notional stated rate. These swaps are designated as cash flow hedges for the forecasted wholesale borrowing transactions and are properly documented as such, and therefore, qualify for cash flow hedge accounting. Any gain or loss associated with the effective portion of our cash flow hedges was recognized in other comprehensive income and is subsequently reclassified into earnings in the period during which the hedged forecasted transactions affect earnings. Changes in the fair value of these derivatives are recorded in accumulated other comprehensive income to the extent there is no significant ineffectiveness in the cash flow hedging relationships. Currently, the Company does not expect to reclassify any amount included in other comprehensive income related to these interest rate swaps to earnings in the next twelve months.

41

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following table shows a summary of these swaps and their terms at March 31, 2014:

	Notional		Fixed	Variable	Trade	Settlement	Maturity
Type	Amount		Rate	Rate Index	Date	Date	Date
	(In thousands)
Interest Rate Swaps	$	25,000	2.4365%	1-Month LIBOR	05/05/11	05/04/12	05/04/16
		25,000	2.6200%	1-Month LIBOR	05/05/11	07/24/12	07/24/16
		25,000	2.6350%	1-Month LIBOR	05/05/11	07/30/12	07/30/16
		50,000	2.6590%	1-Month LIBOR	05/05/11	08/10/12	08/10/16
		100,000	2.6750%	1-Month LIBOR	05/05/11	08/16/12	08/16/16
		40,277	2.4210%	1-Month LIBOR	07/03/13	07/03/13	08/01/23
	$	265,277

An unrealized loss of $10.5 million was recognized in accumulated other comprehensive income related to the valuation of these swaps at March 31, 2014, and the related asset and liability are being reflected in the accompanying unaudited consolidated statements of financial condition.

At March 31, 2014 and December 31, 2013, interest rate swaps not designated as hedging instruments that were offered to clients represented an asset of $2.8 million and $2.9 million, respectively, and were included as part of derivative assets in the unaudited consolidated statements of financial position. The credit risk to these clients stemming from these derivatives, if any, is not material. At March 31, 2014 and December 31, 2013, interest rate swaps not designated as hedging instruments that are the mirror-images of the derivatives offered to clients represented a liability of $2.8 million and $2.9 million, respectively, and were included as part of derivative liabilities in the unaudited consolidated statements of financial condition.

 The following table shows a summary of these interest rate swaps not designated as hedging instruments and their terms at March 31, 2014:

	Notional		Fixed	Variable	Settlement	Maturity
Type	Amount		Rate	Rate Index	Date	Date
	(In thousands)
Interest Rate Swaps - Derivatives Offered to Clients	$	4,094	5.1300%	1-Month LIBOR	07/03/06	07/03/16
		12,500	5.5050%	1-Month LIBOR	04/11/09	04/11/19
	$	16,594
Interest Rate Swaps - Mirror Image Derivatives	$	4,094	5.1300%	1-Month LIBOR	07/03/06	07/03/16
		12,500	5.5050%	1-Month LIBOR	04/11/09	04/11/19
	$	16,594

42

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Options Tied to Standard & Poor’s 500 Stock Market Index

The Company has offered its customers certificates of deposit with an option tied to the performance of the S&P 500 Index. The Company uses option agreements with major broker-dealers to manage its exposure to changes in this index. Under the terms of the option agreements, the Company receives the average increase in the month-end value of the index in exchange for a fixed premium. The changes in fair value of the option agreements used to manage the exposure in the stock market in the certificates of deposit are recorded in earnings. At March 31, 2014 and December 31, 2013, the purchased options used to manage exposure to the S&P 500 Index on stock indexed deposits represented an asset of $12.6 million (notional amount of $23.8 million) and $16.4 million (notional amount of $28.0 million), respectively, and the options sold to customers embedded in the certificates of deposit and recorded as deposits in the unaudited consolidated statements of financial condition, represented a liability of $12.1 million (notional amount of $22.9 million) and $15.7 million (notional amount of $26.9 million), respectively.

Interest rate caps

The Company has entered into interest rate cap transactions with various clients with floating-rate debt who wish to protect their financial results against increases in interest rates. In these cases, the Company simultaneously enters into mirror-image interest rate cap transactions with financial counterparties. None of these cap transactions qualify for hedge accounting; therefore, they are marked to market through earnings. The outstanding total notional amount of interest rate caps was $110.0 million at both March 31, 2014 and December 31, 2013. At March 31, 2014 and December 31, 2013, the interest rate caps sold to clients represented a liability of $374 thousand and $319 thousand, respectively, and were included as part of derivative liabilities in the unaudited consolidated statements of financial condition. At March 31, 2014 and December 31, 2013, the interest rate caps purchased as mirror-images represented an asset of $374 thousand and $319 thousand, respectively, and were included as part of derivative assets in the unaudited consolidated statements of financial condition.

NOTE 8 — ACCRUED INTEREST RECEIVABLE ANDOTHER ASSETS

Accrued interest receivable at March 31, 2014 and December 31, 2013 consists of the following:

	March 31,		December 31,
	2014		2013
	(In thousands)
Non-covered loans	$	14,440	$	13,378
Investments		4,529		5,356
	$	18,969	$	18,734

Other assets at March 31, 2014 and December 31, 2013 consist of the following:

		March 31,		December 31,
	2014		2013
	(In thousands)
Prepaid expenses	$	15,531	$	15,439
Core deposit and customer relationship intangibles		11,370		11,912
Other repossessed assets		13,964		12,583
Mortgage tax credits		8,706		8,706
Investment in Statutory Trust		1,083		1,083
Accounts receivable and other assets		43,689		48,717
	$	94,343	$	98,440

43

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Prepaid expenses amounting to $15.5 million and $15.4 million at March 31, 2014 and December 31, 2013, respectively, include prepaid municipal, property and income taxes aggregating to $9.0 million and $9.6 million, respectively.

As part of the FDIC-assisted acquisition of Eurobank and BBVAPR Acquisition, the Company recorded a core deposit intangible representing the value of checking and savings deposits acquired. At March 31, 2014 and December 31, 2013, this core deposit intangible amounted to $7.5 million and $7.8 million, respectively. In addition, as part of the BBVAPR Acquisition on December 18, 2012, the Company recorded a customer relationship intangible amounting to $5.0 million representing the value of customer relationships acquired in the broker-dealer and insurance subsidiaries as of December 31, 2012. At March 31, 2014 and December 31, 2013, this customer relationship intangible amounted to $3.9 million and $4.1million, respectively.

Other repossessed assets totaled $14.0 million and $12.6 million at March 31, 2013 and December 31, 2013, respectively, include repossessed automobiles amounting to $13.7 million and $12.3 million, respectively.

At March 31, 2014 and December 31, 2013, tax credits for the Company amounted $8.7 million. These tax credits do not have an expiration date.

NOTE 9 —  DEPOSITS AND RELATED INTEREST

Total deposits as of March 31, 2014 and December 31, 2013 consist of the following:

	March 31,		December 31,
	2014		2013
	(In thousands)
Non-interest bearing demand deposits	$	755,909	$	550,302
Interest-bearing savings and demand deposits		2,604,664		2,683,996
Individual retirement accounts		338,719		347,262
Retail certificates of deposit		556,928		598,367
Institutional certificates of deposit		331,859		375,224
Total core deposits		4,588,079		4,555,151
Brokered deposits		712,913		828,114
Total deposits	$	5,300,992	$	5,383,265

Brokered deposits include $617.7 million in certificates of deposits and $95.2 million in money market accounts at March 31, 2014, and $729.8 million in certificates of deposits and $98.3 million in money market accounts at December 31, 2013.

The weighted average interest rate of the Company’s deposits was 0.68% at March 31, 2014 and 0.73% at December 31, 2013, inclusive of non-interest bearing deposits of $755.9 million and $550.3 million, respectively. Interest expense for the quarters ended March 31, 2014 and 2013 was as follows:

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Demand and savings deposits	$	5,028	$	5,962
Certificates of deposit		3,950		3,973
	$	8,978	$	9,935

44

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

At March 31, 2014 and December 31, 2013, demand and interest-bearing deposits and certificates of deposit included deposits of Puerto Rico Cash & Money Market Fund, Inc., which amounted to $97.9 million and $93.1 million, respectively, with a weighted average rate of 0.77% in both years, and were collateralized with investment securities with a fair value of $77.2 million and $67.5 million, respectively.

At March 31, 2014 and December 31, 2013, time deposits in denominations of $100 thousand or higher, excluding accrued interest and unamortized discounts, amounted to $769.1 million and $845.8 million, including public fund time deposits from various Puerto Rico government municipalities, agencies, and corporations of $6.8 million and $26.7 million, respectively, at a weighted average rate of 0.49% at March 31, 2014 and 0.32% at December 31, 2013.

At December 31, 2013, public fund deposits from various Puerto Rico government agencies were collateralized with investment securities with a fair value of $97.8 million, and with commercial loans amounting to $547.3 million at March 31, 2014 and $549.0 million at December 31, 2013.

Excluding equity indexed options in the amount of $11.1 million, which are used by the Company to manage its exposure to the S&P 500 Index, and also excluding accrued interests of $1.7 million and unamortized deposit discount in the amount of $3.3 million, the scheduled maturities of certificates of deposit at March 31, 2014 are as follows:

	March 31, 2014
	(In thousands)
Within one year:
Three (3) months or less	$	303,340
Over 3 months through 1 year		780,260
		1,083,600
Over 1 through 2 years		351,142
Over 2 through 3 years		257,750
Over 3 through 4 years		84,607
Over 4 through 5 years		52,029
	$	1,829,128

The aggregate amount of overdraft in demand deposit accounts that were reclassified to loans amounted to $734 thousand and $1.8 million as of March 31, 2014 and December 31, 2013, respectively.

NOTE 10 —  BORROWINGS

Securities Sold under Agreements to Repurchase

At March 31, 2014, securities underlying agreements to repurchase were delivered to, and are being held by, the counterparties with whom the repurchase agreements were transacted. The counterparties have agreed to resell to the Company the same or similar securities at the maturity of these agreements.

45

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

At March 31, 2014 and December 31, 2013, securities sold under agreements to repurchase (classified by counterparty), excluding accrued interest in the amount of $2.2 million and $2.6 million, respectively, were as follows:

	March 31,				December 31,
	2014				2013
			Fair Value of				Fair Value of
	Borrowing		Underlying		Borrowing		Underlying
	Balance		Collateral		Balance		Collateral
	(In thousands)
JP Morgan Chase Bank NA		255,000		273,834		255,000		273,250
Credit Suisse Securities (USA) LLC		755,000		860,088		755,000		864,232
Deutsche Bank		-		-		255,000		272,053
Total	$	1,010,000	$	1,133,922	$	1,265,000	$	1,409,535

The following table shows a summary of the Company’s repurchase agreements and their terms, excluding accrued interest in the amount of $2.2 million, at March 31, 2014: 

			Weighted-
	Borrowing		Average		Maturity
Year of Maturity	Balance		Coupon	Settlement Date	Date
	(In thousands)
2014	$	85,000	0.675%	12/3/2012	12/3/2014
		85,000
2015		255,000	0.840%	12/10/2012	6/13/2015
		255,000
2016		170,000	1.500%	12/6/2012	12/8/2016
		170,000
2017		500,000	4.78%	3/2/2007	3/2/2017
	$	1,010,000	2.89%

The Company’s repurchase agreement in the amount of $500 million with an original term of ten years, maturing on March 2, 2017, was modified in December 2013 to (i) eliminate the optional early termination clause that allowed the counterparty to terminate it before maturity, (ii) increase the interest rate paid by the Company from 4.67% to 4.78%; and (iii) substitute the counterparty.  

46

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following table presents the liability associated with the repurchase transactions (excluding accrued interest), their maturities and weighted average interest rates. Also, it includes the carrying value and approximate market value of collateral (excluding accrued interest) at March 31, 2014 and December 31, 2013. The information excludes repurchase agreements transactions which were collateralized with securities or cash or which have been obtained under agreements to resell:

	March 31, 2014
					Market Value of Underlying Collateral
									CMOs		Obligations
			Weighted		FNMA and				issued by US		of US
	Repurchase		Average		FHLMC		GNMA		Government		Government
	Liability		Rate		Certificates		Certificates		Sponsored Agencies		Sponsored Agencies		Total
	(Dollars in thousands)
Over 90 days		1,010,000		2.89%		1,061,519		2,403		-		70,000		1,133,922
Total	$	1,010,000		2.89%	$	1,061,519	$	2,403	$	-	$	70,000	$	1,133,922

	December 31, 2013
					Market Value of Underlying Collateral
									CMOs		Obligations
			Weighted		FNMA and				issued by US		of US
	Repurchase		Average		FHLMC		GNMA		Government		Government
	Liability		Rate		Certificates		Certificates		Sponsored Agencies		Sponsored Agencies		Total
	(Dollars in thousands)
Within 30 days	$	255,000		0.50%	$	216,201	$	-	$	48,923	$	6,929	$	272,053
Over 90 days		1,010,000		2.89%		1,018,632		3,000		45,100		3,720		1,070,452
Total	$	1,265,000		2.41%	$	1,234,833	$	3,000	$	94,023	$	10,649	$	1,342,505

Advances from the Federal Home Loan Bank of New York

Advances are received from the FHLB-NY under an agreement whereby the Company is required to maintain a minimum amount of qualifying collateral with a fair value of at least 110% of the outstanding advances. At March 31, 2014 and December 31, 2013, these advances were secured by mortgage and commercial loans amounting to $1.2 billion and $1.3 billion, respectively. Also, at March 31, 2014 and December 31, 2013 the Company had an additional borrowing capacity with the FHLB-NY of $614.1 million and $674.2 million, respectively. At March 31, 2014 and December 31, 2013, the weighted average remaining maturity of FHLB’s advances was 10.7 months and 11.3 months, respectively. The original terms of these advances range between one month and seven years, and the FHLB-NY does not have the right to exercise put options at par on any advances outstanding as of March 31, 2014.

47

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following table shows a summary of these advances and their terms, excluding accrued interest in the amount of $327 thousand, at March 31, 2014: 

			Weighted-
		Borrowing	Average		Maturity
Year of Maturity		Balance	Coupon	Settlement Date	Date
		(In thousands)
2014	$	25,000	0.37%	3/4/2014	4/4/2014
		50,000	0.39%	3/10/2014	4/10/2014
		100,000	0.38%	3/17/2014	4/16/2014
		25,000	0.36%	3/24/2014	4/24/2014
		25,000	0.36%	3/31/2014	4/30/2014
		40,277	0.37%	3/3/2014	4/1/2014
		265,277
2017		4,673	1.24%	4/3/2012	4/3/2017
2018		30,000	2.19%	1/16/2013	1/16/2018
		25,000	2.18%	1/16/2013	1/16/2018
		55,000
2020		10,413	2.59%	7/19/2013	7/20/2020
	$	335,363	0.75%

All of the advances referred to above with maturity dates up to the date of this report were renewed as one-month short-term advances.

Subordinated Capital Notes

Subordinated capital notes amounted to $100.4 million at March 31, 2014 and $100.0 million at December 31, 2013.

Under the requirements of Puerto Rico Banking Act, the Bank must establish a redemption fund for the subordinated capital notes by transferring from undivided profits pre-established amounts as follows:

	Redemption fund
	(In thousands)
Redemption fund - March 31, 2014	$	48,575
2014		6,700
2015		6,700
2016		5,025
	$	67,000

Federal Funds Purchased

Federal funds purchased, presented in the unaudited consolidated statement of financial condition amounted to $23.7 million as of March 31, 2014. The weighted average interest rate during such period was 0.24%.

48

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Other borrowings

Other borrowings, presented in the unaudited consolidated statement of financial condition amounted to $3.7 million at March 31, 2014 and December 31, 2013, which mainly consists of unsecured fixed-rate borrowings and term notes tied to the appreciation of the S&P index. For both periods, the unsecured fixed rate borrowings amounted to $1.7 million at a fixed rate of 3.0%. The term notes tied to the S&P index amounted to $1.0 million at March 31, 2014 and at December 31, 2013 with an index appreciation of $995 thousand and $957 thousand, respectively.

NOTE 11 – OFFSETTING OF FINANCIAL ASSETS AND LIABILITIES

The following table presents the potential effect of rights of set-off associated with the Company’s recognized financial assets and liabilities at March 31, 2014 and December 31, 2013:

March 31, 2014
							Gross Amounts Not Offset in the Statement of Financial Condition
			Gross Amounts		Net Amount of
			Offset in the		Assets Presented
	Gross Amount		Statement of		in Statement				Cash
	of Recognized		Financial		of Financial		Financial		Collateral		Net
	Assets		Condition		Condition		Instruments		Received		Amount
	(In thousands)
Derivatives	$	15,861	$	-	$	15,861	$	6,814	$	-	$	9,047
Total	$	15,861	$	-	$	15,861	$	6,814	$	-	$	9,047
December 31, 2013
							Gross Amounts Not Offset in the Statement of Financial Condition
			Gross Amounts		Net amount of
			Offset in the		Assets Presented
	Gross Amount		Statement of		in Statement				Cash
	of Recognized		Financial		of Financial		Financial		Collateral		Net
	Assets		Condition		Condition		Instruments		Received		Amount
					(In thousands)
Derivatives	$	20,502	$	-	$	20,502	$	2,450	$	6,780	$	11,272
Securities purchased under agreements to resell		60,000		-		60,000		64,587		-		(4,587)
Total	$	80,502	$	-	$	80,502	$	67,037	$	6,780	$	6,685

49

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

March 31, 2014
							Gross Amounts Not Offset in the Statement of Financial Condition
					Net Amount of
			Gross Amounts		Liabilities
			Offset in the		Presented
	Gross Amount		Statement of		in Statement				Cash
	of Recognized		Financial		of Financial		Financial		Collateral		Net
	Liabilities		Condition		Condition		Instruments		Provided		Amount
					(In thousands)
Derivatives	$	25,950	$	-	$	25,950	$	-	$	2,980	$	22,970
Securities sold under agreements to repurchase		1,010,000		-		1,010,000		1,133,922		-		(123,922)
Total	$	1,035,950	$	-	$	1,035,950	$	1,133,922	$	2,980	$	(100,952)
December 31, 2013
							Gross Amounts Not Offset in the Statement of Financial Condition
					Net Amount of
			Gross Amounts		Liabilities
			Offset in the		Presented
	Gross Amount		Statement of		in Statement				Cash
	of Recognized		Financial		of Financial		Financial		Collateral		Net
	Liabilities		Condition		Condition		Instruments		Provided		Amount
	(In thousands)
Derivatives	$	30,672	$	-	$	30,672	$	-	$	2,349	$	28,323
Securities sold under agreements to repurchase		1,265,000		-		1,265,000		1,277,919		67,029		(79,948)
Total	$	1,295,672	$	-	$	1,295,672	$	1,277,919	$	69,378	$	(51,625)

The Company’s derivatives are subject to agreements which allow a right of set-off with each respective counterparty. In addition, the Company’s securities purchased under agreements to resell and securities sold under agreements to repurchase have a right of set-off with the respective counterparty under the supplemental terms of the Master Repurchase Agreements. In an event of default, each party has a right of set-off against the other party for amounts owed in the related agreements and any other amount or obligation owed in respect of any other agreement or transaction between them. Security collateral posted to open and maintain a master netting agreement with a counterparty, in the form of cash and securities, may from time to time be segregated in an account at a third-party custodian pursuant to a tri-party Account Control Agreement.

50

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

NOTE 12 —  RELATED PARTY TRANSACTIONS

The Bank grants loans to its directors, executive officers and to certain related individuals or organizations in the ordinary course of business. These loans are offered at the same terms as loans to unrelated third parties. As of March 31, 2014 and December 31, 2013, these loan balances amounted to $19.3 million and $19.0 million, respectively. The activity and balance of these loans for the quarters ended March 31, 2014 and 2013 were as follows:

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Balance at the beginning of year	$	18,963	$	3,772
New loans		-		2,435
Repayments and sales		304		(95)
Credits of persons no longer         considered related parties		-		(57)
Balance at the end of year	$	19,267	$	6,055

NOTE 13 —  INCOME TAXES

On June 30, 2013 the Governor signed Act No. 40-2013, known as “Ley de Redistribución y Ajuste de la Carga Contributiva” (Act of Redistribution and Adjustment of Tax Burden), as amended. The main purpose of the Act is to increase government collections in order to alleviate the structural deficit. The most relevant provisions of the Act, as applicable to the Company, and effective for taxable years beginning after December 31,2012 are as follows: (1) the maximum Corporate Income Tax rate was increased from 30% to 39%; (2) the deduction allowed for determining the income subject to surtax was reduced from $750,000 to $25,000 (which must be allocated among the members of a controlled group of corporations); (3) the allowable Net Operating Loss (“NOL”) deduction was reduced to (i) 90% of the corporation’s net income subject to regular tax for purposes of computing the regular income tax, and (ii) 80% of the alternative minimum taxable income for purposes of computing the alternative minimum tax (“AMT”); (4) the NOL carryover period was extended from 10 to 12 years for NOLs incurred in taxable years beginning after December 31, 2004 and before January 1, 2013, and from 7 to 10 years for losses incurred in taxable years beginning after December 31, 2012; (5) a new special tax based on gross income (the “Special Tax”) was added to the Puerto Rico Internal Revenue Code of 2011, as further described below; and (6) a special tax of 1% was imposed on insurance premiums earned after June 30, 2013.

 In the case of non-financial institutions, the Special Tax is paid as part of the AMT and thus is accounted for under the provisions of ASC 740. The applicable Special Tax rate for non-financial institutions increases gradually from 0.2% for gross income equal to or in excess of $1.0 million up to 0.85% for gross income in excess of $1.5 billion. In the case of a controlled group of corporations, the tax rate for all members of the group is determined by the aggregate gross income of all members in the group. In the case of financial institutions, the Special Tax is not part of the AMT calculation thus is accounted for as other tax not subject to the provisions of ASC 740 since the same is based on gross income. The applicable Special Tax rate for financial institutions is 1% of its gross income of a taxable year, of which fifty percent (50%) may be claimed as a credit against the financial institution’s applicable income tax of that year.

At March 31, 2014 and December 31, 2013, the Company’s net deferred tax asset amounted to $127.7 million and $137.6 million, respectively. In assessing the realizability of the deferred tax asset, management considers whether it is more likely than not that some portion or the entire deferred tax asset will not be realized. The ultimate realization of the deferred tax asset is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible.  Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment.  Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax asset are deductible, management believes it is more likely than not that the Company will realize the entire deferred tax asset, net of the existing valuation allowances recorded at March 31, 2014 and December 31, 2013. The amount of the deferred tax asset considered realizable, however, could be reduced in the near term if estimates of future taxable income during the carryforward period are reduced.

51

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

At March 31, 2014 and December 31, 2013, Oriental International Bank Inc. (“OIB”), the Bank’s international banking entity subsidiary, had $219 thousand and $356 thousand, respectively, in income tax effect of unrecognized gain on available-for-sale securities included in other comprehensive income. Following the change in OIB’s applicable tax rate from 5% to 0% as a result of a Puerto Rico law adopted in 2011, this remaining tax balance will flow through income as these securities are repaid or sold in future periods. During the quarters ended March 31, 2014 and 2013, $137 thousand and $47 thousand, respectively, related to this residual tax effect from OIB was reclassified from accumulated other comprehensive income into income tax provision.

The Company classifies unrecognized tax benefits in income taxes payable. These gross unrecognized tax benefits would affect the effective tax rate if realized. The balance of unrecognized tax benefits at March 31, 2014 was $4.0 million (December 31, 2013 - $4.0 million). The Company had accrued $1.6 million at March 31, 2014 (December 31, 2013 - $1.2 million) for the payment of interest and penalties relating to unrecognized tax benefits.

Income tax expense was $11.8 million for the quarter ended March 31, 2014, compared to $7.1 million for the same period in 2013. The increase in enacted tax rate from 30% to 39% from the second quarter 2013 amendment to the Puerto Rico tax Code resulted in the increased quarterly income tax expense for this quarter as compared to the same quarter of 2013.

NOTE 14 —  STOCKHOLDERS’ EQUITY AND EARNINGS PER COMMON SHARE

Regulatory Capital Requirements

The Company (on a consolidated basis) and the Bank are subject to various regulatory capital requirements administered by federal and Puerto Rico banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s and the Bank’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of their assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Pursuant to the Dodd-Frank Act, federal banking regulators have adopted new capital rules that became effective January 1, 2014 for advanced approaches banking organizations and will become effective January 1, 2015 for all other covered organizations (subject to certain phase-in periods through January 1, 2019) and that will replace their general risk-based capital rules, advanced approaches rule, market risk rule, and leverage rules.

Quantitative measures established by regulation to ensure capital adequacy currently require the Company and the Bank to maintain minimum amounts and ratios (set forth in the following table) of total and Tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined in the regulations) and of Tier 1 capital to average total assets (as defined in the regulations). As of March 31, 2014 and December 31, 2013, the Company and the Bank met all capital adequacy requirements to which they are subject. As of March 31, 2014 and December 31, 2013, the Bank is “well capitalized” under the regulatory framework for prompt corrective action. To be categorized as “well capitalized,” an institution must maintain minimum total risk-based, Tier 1 risk-based and Tier 1 leverage ratios as set forth in the following tables. 

52

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The Company’s and the Bank’s actual capital amounts and ratios as of March 31, 2014 and December 31, 2013 are as follows:

				Minimum Capital			Minimum to be Well
	Actual			Requirement			Capitalized
	Amount		Ratio	Amount		Ratio		Amount	Ratio
	(Dollars in thousands)
Company Ratios
As of March 31, 2014
Total capital to risk-weighted assets	$	836,168	16.56%	$	404,054	8.00%	$	505,067	10.00%
Tier 1 capital to risk-weighted assets	$	745,619	14.76%	$	202,027	4.00%	$	303,040	6.00%
Tier 1 capital to average total assets	$	745,619	9.51%	$	313,594	4.00%	$	391,993	5.00%
As of December 31, 2013
Total capital to risk-weighted assets	$	827,460	16.16%	$	409,514	8.00%	$	511,893	10.00%
Tier 1 capital to risk-weighted assets	$	736,930	14.35%	$	204,757	4.00%	$	307,136	6.00%
Tier 1 capital to average total assets	$	736,930	9.11%	$	324,910	4.00%	$	406,138	5.00%

				Minimum Capital			Minimum to be Well
	Actual			Requirement			Capitalized
	Amount		Ratio	Amount		Ratio	Amount		Ratio
	(Dollars in thousands)
Bank Ratios
As of March 31, 2014
Total capital to risk-weighted assets	$	805,900	16.02%	$	402,495	8.00%	$	503,119	10.00%
Tier 1 capital to risk-weighted assets	$	715,591	14.22%	$	201,248	4.00%	$	301,871	6.00%
Tier 1 capital to average total assets	$	715,591	9.18%	$	311,659	4.00%	$	389,574	5.00%
As of December 31, 2013
Total capital to risk-weighted assets	$	779,413	15.30%	$	407,637	8.00%	$	509,547	10.00%
Tier 1 capital to risk-weighted assets	$	688,350	13.51%	$	203,819	4.00%	$	305,728	6.00%
Tier 1 capital to average total assets	$	688,350	8.54%	$	322,395	4.00%	$	402,993	5.00%

    Additional paid-in capital

Additional paid-in capital represents contributed capital in excess of par value of common and preferred stock net of costs of the issuance. As of March 31, 2014, accumulated issuance costs charged against additional paid in capital amounted to $10.1 million and $13.6 million for preferred and common stock, respectively.

53

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Earnings per Common Share

The calculation of earnings per common share for the quarters ended March 31, 2014 and 2013 is as follows:

	Quarter Ended March 31,
	2014		2013
	(In thousands, except per share data)
Net income	$	23,747	$	21,192
Less: Dividends on preferred stock
Non-Convertible Preferred Stock (Series A, B, and D)		(1,628)		(1,628)
Convertible preferred stock (Series C)		(1,837)		(1,837)
Income available to common shareholders	$	20,282	$	17,727
Effect of assumed conversion of the Convertible Preferred Stock		1,837		1,837
Income available to common shareholders assuming conversion	$	22,119	$	19,564
Weighted average common shares and share equivalents:
Average common shares outstanding		45,329		45,595
Effect of dilutive securities:
Average potential common shares-options		131		159
Average potential common shares-assuming conversion of                    '     ' convertible preferred stock		7,138		7,138
Total weighted average common shares outstanding                      ' 'and equivalents		52,598		52,892
Earnings per common share - basic	$	0.45	$	0.39
Earnings per common share - diluted	$	0.42	$	0.37

In computing diluted earnings per common share, the 84,000 shares of convertible preferred stock, which remain outstanding at March 31, 2014, with a conversion rate, subject to certain conditions, of 84.9798 shares of common stock per share, were included as average potential common shares from the date they were issued and outstanding. Moreover, in computing diluted earnings per common share, the dividends declared during the quarters ended March 31, 2014 and 2013 on the convertible preferred stock were added back as income available to common shareholders.

For the quarters ended March 31, 2014 and 2013, weighted-average stock options with an anti-dilutive effect on earnings per share not included in the calculation amounted to 254,662, and 653,843, respectively.

Treasury Stock

Under the Company’s current stock repurchase program it is authorized to purchase in the open market up to $70 million of its outstanding shares of common stock, of which approximately $23.1 million of authority remains. The shares of common stock repurchased are to be held by the Company as treasury shares. During the quarter ended March 31, 2014, the Company purchased 707,400 shares under this program for a total of $10.4 million, at an average price of $14.66 per share. There were no repurchases during 2013.

54

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following table presents the shares repurchased for each month in the quarter ended March 31, 2014, excluding the month ended March 31, 2014, during which no shares were purchased as part of the stock repurchase program:

	Total number of				Dollar amount of
	shares purchased as		Average		shares repurchased
		part of stock	price paid		(excluding
	repurchase programs		per share		commissions paid)
						(In thousands)
Period
January 2014		57,700	$	14.73	$	850
February 2014		649,700	$	14.66	$	9,522
Quarter ended March 31, 2014		707,400		14.66		10,372

The number of shares that may yet be purchased under the $70 million program is estimated at 1,341,002 and was calculated by dividing the remaining balance of $23.1 million by $17.19 (closing price of the Company common stock at March 31, 2014). The Company did not purchase any shares of its common stock other than through its publicly announced stock repurchase program during the quarter ended March 31, 2014.

The activity in connection with common shares held in treasury by the Company for quarters ended March 31, 2014 and 2013 is set forth below:

	Quarter Ended March 31,
	2014			2013
		Dollar			Dollar
	Shares	Amount		Shares	Amount
	(In thousands, except shares data)
Beginning of year	7,030,101	$	80,642	7,090,597	$	81,275
Common shares used upon lapse of restricted stock units	(27,752)		(292)	(33,600)		(351)
Common shares repurchased as part of the stock repurchase program	707,400		10,393	-		-
Common shares used to match defined contribution plan, net	-		-	(7,318)		(77)
End of year	7,709,749	$	90,743	7,049,679	$	80,847

Accumulated Other Comprehensive Income

Accumulated other comprehensive income, net of income tax, as of March 31, 2014 and December 31, 2013 consisted of:

	March 31,		December 31,
	2014		2013
	(In thousands)
Unrealized gain on securities available-for-sale which are not     other-than-temporarily impaired	$	18,464	$	13,267
Income tax effect of unrealized gain on securities available-for-sale		(2,429)		(1,834)
Net unrealized gain on securities available-for-sale which are not         other-than-temporarily impaired		16,035		11,433
Unrealized loss on cash flow hedges		(10,529)		(10,907)
Income tax effect of unrealized loss on cash flow hedges		2,516		2,665
Net unrealized loss on cash flow hedges		(8,013)		(8,242)
Accumulated other comprehensive income, net of taxes	$	8,022	$	3,191

55

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following table presents changes in accumulated other comprehensive income by component, net of taxes, for the quarters ended March 31, 2014 and 2013:

	Quarter Ended March 31,
	2014						2013
	Net unrealized		Net unrealized		Accumulated		Net unrealized		Net unrealized		Accumulated
	gains on		loss on		other		gains on		loss on		other
	securities		cash flow		comprehensive		securities		cash flow		comprehensive
	available-for-sale		hedges		income		available-for-sale		hedges		income
	(In thousands)						(In thousands)
Beginning balance	$	11,433	$	(8,242)	$	3,191	$	68,245	$	(12,365)	$	55,880
Other comprehensive income before reclassifications		4,465		(1,392)		3,073		(9,899)		(313)		(10,212)
Amounts reclassified out of accumulated other comprehensive income		137		1,621		1,758		47		1,336		1,383
Other comprehensive income (loss)		4,602		229		4,831		(9,852)		1,023		(8,829)
Ending balance	$	16,035	$	(8,013)	$	8,022	$	58,393	$	(11,342)	$	47,051

The following table presents reclassifications out of accumulated other comprehensive income for the quarters ended March 31, 2014 and 2013:

					Affected Line Item in
	Quarter ended March 31,				Consolidated Statement
	2014		2013		of Operations
	(In thousands)
Cash flow hedges:
Interest-rate contracts	$	1,621	$	1,336	Net interest expense
Available-for-sale securities:
Residual tax effect from OIB's change in applicable tax rate		137		47	Income tax expense
	$	1,758	$	1,383

56

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

NOTE 15 – GUARANTEES

At March 31, 2014 the unamortized balance of the obligations undertaken in issuing the guarantees under standby letters of credit represented a liability of $38.9 million (December 31, 2013 - $38.6 million).

The Company assumed a liability for residential mortgage loans sold by BBVAPR Bank subject to credit recourse, principally loans associated with FNMA residential mortgage loan sales and securitization programs. At March 31, 2014 and December 31, 2013, the unpaid principal balance of residential mortgage loans sold subject to credit recourse was $118.2 million and $122.3 million, respectively. In the event of any customer default, pursuant to the credit recourse provided, the Company is required to repurchase the loan or reimburse the third party investor for the incurred loss. The maximum potential amount of future payments that the Company would be required to make under the recourse arrangements in the event of nonperformance by the borrowers is equivalent to the total outstanding balance of the residential mortgage loans serviced with recourse and interest, if applicable. During the quarter ended March 31, 2014, the Company repurchased approximately $1.6 million of unpaid principal balance in mortgage loans subject to the credit recourse provisions. In the event of nonperformance by the borrower, the Company has rights to the underlying collateral securing the mortgage loan. The Company suffers ultimate losses on these loans when the proceeds from a foreclosure sale of the property underlying a defaulted mortgage loan are less than the outstanding principal balance of the loan plus any uncollected interest advanced and the costs of holding and disposing the related property. At March 31, 2014 and December 31, 2013 the Company’s liability established to cover the estimated credit loss exposure related to loans sold with credit recourse amounted to $1.5 million (December 31, 2013 – $2.0 million). The following table shows the changes in the Company’s liability of estimated loss from these credit recourse agreements, included in the unaudited consolidated statements of financial condition during the quarters ended March 31, 2014 and 2013.

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Balance at beginning of year	$	1,955	$	-
Additions from BBVAPR Acquisition		-		2,460
Net charge-offs/terminations		(406)		-
Balance at end of year	$	1,549	$	2,460

The estimated losses to be absorbed under the credit recourse arrangements are recorded as a liability when the loans are sold or credit recourse is assumed, and are updated on a quarterly basis. The expected loss, which represents the amount expected to be lost on a given loan, considers the probability of default and loss severity. The probability of default represents the probability that a loan in good standing would become 120 days delinquent, in which case the Company is obligated to repurchase the loan. At March 31, 2014, $86.5 million or 73% of the recourse obligation will be extinguished during the next two years.

57

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

When the Company sells or securitizes mortgage loans, it generally makes customary representations and warranties regarding the characteristics of the loans sold. The Company's mortgage operations division groups conforming mortgage loans into pools which are exchanged for FNMA and GNMA mortgage-backed securities, which are generally sold to private investors, or are sold directly to FNMA or other private investors for cash. As required under such mortgage backed securities programs, quality review procedures are performed by the Company to ensure that asset guideline qualifications are met. To the extent the loans do not meet specified characteristics, the Company may be required to repurchase such loans or indemnify for losses and bear any subsequent loss related to the loans. Repurchases during the quarter ended March 31, 2014 under the Company’s representation and warranty arrangements, excluding mortgage loans subject to credit recourse provisions referred to above, approximated $2.8 million in unpaid principal balance (December 31, 2013 - $12.5 million). A substantial amount of these loans reinstate to performing status or have mortgage insurance, and thus the ultimate losses on the loans are not deemed significant.

During the quarter ended March 31, 2014, the Company recognized $50 thousand in losses from the repurchase of residential mortgage loans sold, subject to credit recourse and $434 thousand not subject to credit recourse. In addition, during the quarter ended March 31, 2013, the Company recognized $25 thousand in losses from the repurchase of residential mortgage loans sold, subject to credit recourse and $2 thousand not subject to credit recourse.

Servicing agreements relating to the mortgage-backed securities programs of FNMA and GNMA, and to mortgage loans sold or serviced to certain other investors, including FHLMC, require the Company to advance funds to make scheduled payments of principal, interest, taxes and insurance, if such payments have not been received from the borrowers. At March 31, 2014, the Company serviced $1.1 billion in mortgage loans for third-parties. The Company generally recovers funds advanced pursuant to these arrangements from the mortgage owner, from liquidation proceeds when the mortgage loan is foreclosed or, in the case of FHA/VA loans, under the applicable FHA and VA insurance and guarantees programs. However, in the meantime, the Company must absorb the cost of the funds it advances during the time the advance is outstanding. The Company must also bear the costs of attempting to collect on delinquent and defaulted mortgage loans. In addition, if a defaulted loan is not cured, the mortgage loan would be canceled as part of the foreclosure proceedings and the Company would not receive any future servicing income with respect to that loan. At March 31, 2014, the outstanding balance of funds advanced by the Company under such mortgage loan servicing agreements was approximately $323 thousand (December 31, 2013 - $243 thousand). To the extent the mortgage loans underlying the Company's servicing portfolio experience increased delinquencies, the Company would be required to dedicate additional cash resources to comply with its obligation to advance funds as well as incur additional administrative costs related to increases in collection efforts.

58

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

NOTE 16 —  COMMITMENTS AND CONTINGENCIES

Loan Commitments

In the normal course of business, the Company becomes a party to credit-related financial instruments with off-balance-sheet risk to meet the financing needs of its customers. These financial instruments include commitments to extend credit, standby and commercial letters of credit, and financial guarantees. Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amounts recognized in the consolidated statements of financial condition. The contract or notional amount of those instruments reflects the extent of the Company’s involvement in particular types of financial instruments.

The Company’s exposure to credit losses in the event of nonperformance by the counterparty to the financial instrument for commitments to extend credit, including commitments under credit card arrangements, and commercial letters of credit is represented by the contractual notional amounts of those instruments, which do not necessarily represent the amounts potentially subject to risk. In addition, the measurement of the risks associated with these instruments is meaningful only when all related and offsetting transactions are identified. The Company uses the same credit policies in making commitments and conditional obligations as it does for on-balance-sheet instruments.

Summarized credit-related financial instruments at March 31, 2014 and December 31, 2013 were as follows:

	March 31,		December 31,
	2014		2013
	(In thousands)
Commitments to extend credit	$	494,327	$	520,269
Commercial letters of credit		1,740		1,096

Commitments to extend credit represent agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. The Company evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if it is deemed necessary by the Company upon the extension of credit, is based on management’s credit evaluation of the counterparty.

At March 31, 2014 and December 31, 2013, commitments to extend credit consisted mainly of undisbursed available amounts on commercial lines of credit, construction loans, and revolving credit card arrangements. Since many of the unused commitments are expected to expire unused or be only partially used, the total amount of these unused commitments does not necessarily represent future cash requirements. These lines of credit had a reserve of $900 thousand at both March 31, 2014 and December 31, 2013.

Commercial letters of credit are issued or confirmed to guarantee payment of customers’ payables or receivables in short-term international trade transactions. Generally, drafts will be drawn when the underlying transaction is consummated as intended. However, the short-term nature of this instrument serves to mitigate the risk associated with these contracts.

59

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The summary of instruments that are considered financial guarantees in accordance with the authoritative guidance related to guarantor’s accounting and disclosure requirements for guarantees, including indirect guarantees of indebtedness of others, at March 31, 2014 and December 31, 2013, is as follows:

	March 31,		December 31,
	2014		2013
	(In thousands)
Standby letters of credit and financial guarantees	$	38,875	$	38,577
Loans sold with recourse		118,163		122,291
Commitments to sell or securitize mortgage loans		34,220		99,307

Standby letters of credit and financial guarantees are written conditional commitments issued by the Company to guarantee the payment and/or performance of a customer to a third party (“beneficiary”). If the customer fails to comply with the agreement, the beneficiary may draw on the standby letter of credit or financial guarantee as a remedy. The amount of credit risk involved in issuing letters of credit in the event of nonperformance is the face amount of the letter of credit or financial guarantee. These guarantees are primarily issued to support public and private borrowing arrangements, including commercial paper, bond financing, and similar transactions. The amount of collateral obtained, if it is deemed necessary by the Company upon extension of credit, is based on management’s credit evaluation of the customer.

Lease Commitments

The Company has entered into various operating lease agreements for branch facilities and administrative offices. Rent expense for the quarters ended March 31, 2014 and 2013, amounted to $2.5 million, and $2.7 million, respectively, and is included in the “occupancy and equipment” caption in the unaudited consolidated statements of operations. Future rental commitments under leases in effect at March 31, 2014, exclusive of taxes, insurance, and maintenance expenses payable by the Company, are summarized as follows:

Quarter Ending March 31,	Minimum Rent
	(In thousands)
2014	$	6,170
2015		8,013
2016		7,388
2017		6,761
2018		5,864
Thereafter		22,004
	$	56,200

60

OFG BANCORP

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Contingencies

The Company and its subsidiaries are defendants in a number of legal proceedings incidental to their business. In the ordinary course of business, the Company and its subsidiaries are also subject to governmental and regulatory examinations. Certain subsidiaries of the Company, including the Bank (and its subsidiary OIB), Oriental Financial Services, and Oriental Insurance, are subject to regulation by various U.S., Puerto Rico and other regulators.

The Company seeks to resolve all litigation and regulatory matters in the manner management believes is in the best interests of the Company and its shareholders, and contests allegations of liability or wrongdoing and, where applicable, the amount of damages or scope of any penalties or other relief sought as appropriate in each pending matter.

Subject to the accounting and disclosure framework under the provisions of ASC 450, it is the opinion of the Company’s management, based on current knowledge and after taking into account its current legal accruals, that the eventual outcome of all matters would not be likely to have a material adverse effect on the consolidated statements of financial condition of the Company. Nonetheless, given the substantial or indeterminate amounts sought in certain of these matters, and the inherent unpredictability of such matters, an adverse outcome in certain of these matters could, from time to time, have a material adverse effect on the Company’s consolidated results of operations or cash flows in particular quarterly or annual periods. The Company has evaluated all litigation and regulatory matters where the likelihood of a potential loss is deemed reasonably possible. The Company has determined that the estimate of the reasonably possible loss is not significant.

NOTE 17 - FAIR VALUEOF FINANCIAL INSTRUMENTS

The Company follows the fair value measurement framework under GAAP.

Fair Value Measurement

The fair value measurement framework defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. This framework also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs previously described that may be used to measure fair value.

Money market investments

The fair value of money market investments is based on the carrying amounts reflected in the consolidated statements of financial condition as these are reasonable estimates of fair value given the short-term nature of the instruments.

Investment securities

The fair value of investment securities is based on quoted market prices, when available, or market prices provided by recognized broker-dealers. If listed prices or quotes are not available, fair value is based upon externally developed models that use both observable and unobservable inputs depending on the market activity of the instrument. The Company holds two securities categorized as other debt that are classified as Level 3. The estimated fair value of the other debt securities is determined by using a third-party model to calculate the present value of projected future cash flows. The assumptions are highly uncertain and include primarily market discount rates, current spreads, and an indicative pricing. The assumptions used are drawn from similar securities that are actively traded in the market and have similar characteristics as the collateral underlying the debt securities being evaluated. The valuation is performed on a monthly basis.

61

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Derivative instruments

The fair value of the interest rate swaps is largely a function of the financial market’s expectations regarding the future direction of interest rates. Accordingly, current market values are not necessarily indicative of the future impact of derivative instruments on earnings. This will depend, for the most part, on the shape of the yield curve, the level of interest rates, as well as the expectations for rates in the future. The fair value of most of these derivative instruments is based on observable market parameters, which include discounting the instruments’ cash flows using the U.S. dollar LIBOR-based discount rates, and also applying yield curves that account for the industry sector and the credit rating of the counterparty and/or the Company.

Certain other derivative instruments with limited market activity are valued using externally developed models that consider unobservable market parameters. Based on their valuation methodology, derivative instruments are classified as Level 2 or Level 3. The Company has offered its customers certificates of deposit with an option tied to the performance of the S&P Index and uses equity indexed option agreements with major broker-dealers to manage its exposure to changes in this index. Their fair value is obtained through the use of an external based valuation that was thoroughly evaluated and adopted by management as its measurement tool for these options. The payoff of these options is linked to the average value of the S&P Index on a specific set of dates during the life of the option. The methodology uses an average rate option or a cash-settled option whose payoff is based on the difference between the expected average value of the S&P Index during the remaining life of the option and the strike price at inception. The assumptions, which are uncertain and require a degree of judgment, include primarily S&P Index volatility, forward interest rate projections, estimated index dividend payout, and leverage.

Servicing assets

Servicing assets do not trade in an active market with readily observable prices. Servicing assets are priced using a discounted cash flow model. The valuation model considers servicing fees, portfolio characteristics, prepayment assumptions, delinquency rates, late charges, other ancillary revenues, cost to service and other economic factors. Due to the unobservable nature of certain valuation inputs, the servicing rights are classified as Level 3.

Loans receivable considered impaired that are collateral dependent

The impairment is measured based on the fair value of the collateral, which is derived from appraisals that take into consideration prices in observed transactions involving similar assets in similar locations, in accordance with the provisions of ASC 310-10-35. Currently, the associated loans considered impaired are classified as Level 3.

Foreclosed real estate

Foreclosed real estate includes real estate properties securing residential mortgage and commercial loans. The fair value of foreclosed real estate may be determined using an external appraisal, broker price option or an internal valuation. These foreclosed assets are classified as Level 3 given certain internal adjustments that may be made to external appraisals.

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Assets and liabilities measured at fair value on a recurring and non-recurring basis, including financial liabilities for which the Company has elected the fair value option, are summarized below:

	March 31, 2014
	Fair Value Measurements
	Level 1		Level 2		Level 3		Total
	(In thousands)
Recurring fair value measurements:
Investment securities available-for-sale	$	-	$	1,435,632	$	20,053	$	1,455,685
Money market investments		7,652		-		-		7,652
Derivative assets		-		3,306		12,555		15,861
Servicing assets		-		-		13,970		13,970
Derivative liabilities		-		(13,830)		(12,120)		(25,950)
	$	7,652	$	1,425,108	$	34,458	$	1,467,218
Non-recurring fair value measurements:
Impaired commercial loans	$	-	$	-	$	27,975	$	27,975
Foreclosed real estate		-		-		96,884		96,884
	$	-	$	-	$	124,859	$	124,859

	December 31, 2013
	Fair Value Measurements
	Level 1		Level 2		Level 3		Total
	(In thousands)
Recurring fair value measurements:
Investment securities available-for-sale	$	-	$	1,568,745	$	19,680	$	1,588,425
Securities purchased under agreements to resell		-		60,000		-		60,000
Money market investments		6,967		-		-		6,967
Derivative assets		-		4,072		16,430		20,502
Servicing assets		-		-		13,801		13,801
Derivative liabilities		-		(14,937)		(15,736)		(30,673)
	$	6,967	$	1,617,880	$	34,175	$	1,659,022
Non-recurring fair value measurements:
Impaired commercial loans	$	-	$	-	$	28,353	$	28,353
Foreclosed real estate		-		-		90,024		90,024
	$	-	$	-	$	118,377	$	118,377

63

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The table below presents a reconciliation of all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the quarters ended March 31, 2014 and 2013:

	Quarter Ended March 31, 2014
				Derivative				Derivative
		Other		asset				liability
		debt		(S&P				(S&P
		securities		Purchased		Servicing		Embedded
Level 3 Instruments Only		available-for-sale		Options)		assets		Options)		Total
Balance at beginning of year		$	19,680	$	16,430	$	13,801	$	(15,736)	$	34,175
Gains (losses) included in earnings			-		(3,875)		-		3,373		(502)
Changes in fair value of investment         securities available for sale included         in other comprehensive income			373		-		-		-		373
New instruments acquired			-		-		563		-		563
Principal repayments			-		-		(196)		-		(196)
Amortization			-		-		-		243		243
Changes in fair value of servicing assets			-		-		(198)		-		(198)
Balance at end of year		$	20,053	$	12,555	$	13,970	$	(12,120)	$	34,458

	Quarter Ended March 31, 2013
	Investment securities
	available-for-sale
					Derivative				Derivative
					asset				liability
			Other		(S&P				(S&P
			debt		Purchased		Servicing		Embedded
Level 3 Instruments Only	CLOs		securities		Options)		assets		Options)		Total
Balance at beginning of period	$	27,280	$	10,016	$	11,367	$	10,776	$	(10,912)	$	48,527
Gains (losses) included in earnings		-		-		1,721		-		(1,707)		14
Changes in fair value of investment         securities available for sale included         in other comprehensive income		1,705		1		-		-		-		1,706
New instruments acquired		-		-		-		487		-		487
Principal repayments		-		-		-		(307)		-		(307)
Amortization		17		-		-		-		50		67
Changes in fair value of servicing assets		-		-		-		(314)		-		(314)
Balance at end of period	$	29,002	$	10,017	$	13,088	$	10,642	$	(12,569)	$	50,180

During the quarter ended March 31, 2014 and 2013, there were purchases and sales of assets and liabilities measured at fair value on a recurring basis. There were no transfers into and out of Level 1 and Level 2 fair value measurements during such periods.

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The table below presents quantitative information for all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) at March 31, 2014:

	March 31, 2014
	Fair Value		Valuation Technique	Unobservable Input	Range
	(In thousands)
Investment securities     available-for-sale:
Other debt securities	$	20,053	Market comparable bonds	Indicative pricing	97.125% - 98.975%
				Option adjusted spread	683.7% - 1602.0%
				Yield to maturity	7.05% - 15.89%
				Spread to maturity	689.9% - 1579.0%
Derivative assets (S&P     Purchased Options)	$	12,555	Option pricing model	Implied option volatility	22.887% - 53.615%
				Counterparty credit risk     (based on 5-year credit     default swap ("CDS")     spread)	56.360% - 86.490%
Servicing assets	$	13,970	Cash flow valuation	Constant prepayment rate	5.60% - 10.08%
				Discount rate	10.00% - 12.00%
Derivative liability (S&P     Embedded Options)	$	(12,120)	Option pricing model	Implied option volatility	22.887% - 53.615%
				Counterparty credit risk (based on 5-year CDS spread)	56.360% - 86.490%
Collateral dependant     impaired loans	$	27,975	Fair value of property     or collateral	Appraised value less disposition costs	21.30% - 28.30%

65

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Information about Sensitivity to Changes in Significant Unobservable Inputs

Other debt securities – The significant unobservable inputs used in the fair value measurement of one of the Company’s other debt securities are indicative comparable pricing, option adjusted spread (“OAS”), yield to maturity, and spread to maturity. Significant changes in any of those inputs in isolation would result in a significantly different fair value measurement. Generally, a change in the assumption used for indicative comparable pricing is accompanied by a directionally opposite change in the assumption used for OAS and a directionally, although not equally proportional, opposite change in the assumptions used for yield to maturity and spread to maturity.

Derivative asset (S&P Purchased Options) – The significant unobservable inputs used in the fair value measurement of the Company’s derivative assets related to S&P purchased options are implied option volatility and counterparty credit risk. Significant changes in any of those inputs in isolation would result in a significantly different fair value measurement. Generally, a change in the assumption used for implied option volatility is not necessarily accompanied by directionally similar or opposite changes in the assumption used for counterparty credit risk.

Servicing assets – The significant unobservable inputs used in the fair value measurement of the Company’s servicing assets are constant prepayment rates and discount rates. Changes in one factor may result in changes in another (for example, increases in market interest rates may result in lower prepayments), which may magnify or offset the sensitivities. Mortgage banking activities, a component of total banking and financial service revenue in the consolidated statements of operations, include the changes from period to period in the fair value of the mortgage loan servicing rights, which may result from changes in the valuation model inputs or assumptions (principally reflecting changes in discount rates and prepayment speed assumptions) and other changes, including changes due to collection/realization of expected cash flows.

Derivative liability (S&P Embedded Options) – The significant unobservable inputs used in the fair value measurement of the Company’s derivative liability related to S&P purchased options are implied option volatility and counterparty credit risk. Significant changes in any of those inputs in isolation would result in a significantly different fair value measurement. Generally, a change in the assumption used for implied option volatility is not necessarily accompanied by directionally similar or opposite changes in the assumption used for counterparty credit risk.

The table below presents a detail of investment securities available-for-sale classified as Level 3 at March 31, 2014:

	March 31, 2014
							Weighted
	Amortized		Unrealized				Average	Principal
Type	Cost		Gains (Losses)		Fair Value		Yield	Protection
	(In thousands)
Other debt securities	$	20,000	$	53	$	20,053	3.50%	N/A

Fair Value of Financial Instruments

The information about the estimated fair value of financial instruments required by GAAP is presented hereunder. The aggregate fair value amounts presented do not necessarily represent management’s estimate of the underlying value of the Company.

The estimated fair value is subjective in nature, involves uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could affect these fair value estimates. The fair value estimates do not take into consideration the value of future business and the value of assets and liabilities that are not financial instruments. Other significant tangible and intangible assets that are not considered financial instruments are the value of long-term customer relationships of retail deposits, and premises and equipment.

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The estimated fair value and carrying value of the Company’s financial instruments at March 31, 2014 and December 31, 2013 is as follows:

	March 31,				December 31,
	2014				2013
	Fair		Carrying		Fair		Carrying
	Value		Value		Value		Value
	(In thousands)
Level 1
Financial Assets:
Cash and cash equivalents	$	624,636	$	624,636	$	621,269	$	621,269
Restricted cash		15,170		15,170		82,199		82,199
Level 2
Financial Assets:
Securities purchased under agreements to resell		-		-		60,000		60,000
Trading securities		1,910		1,910		1,869		1,869
Investment securities available-for-sale		1,435,632		1,435,632		1,568,745		1,568,745
Federal Home Loan Bank (FHLB) stock		24,430		24,430		24,450		24,450
Derivative assets		3,306		3,306		4,072		4,072
Derivative liabilities		13,830		13,830		14,937		14,937
Level 3
Financial Assets:
Investment securities available-for-sale		20,053		20,053		19,680		19,680
Total loans (including loans held-for-sale)
Non-covered loans, net		4,737,604		4,654,749		4,857,505		4,662,458
Covered loans, net		400,355		347,865		459,444		356,961
Derivative assets		12,555		12,555		16,430		16,430
FDIC shared-loss indemnification asset		106,170		166,194		152,965		189,240
Accrued interest receivable		18,969		18,969		18,734		18,734
Servicing assets		13,970		13,970		13,801		13,801
Financial Liabilities:
Deposits		5,247,226		5,300,992		5,409,540		5,383,265
Securities sold under agreements to repurchase		1,076,000		1,012,240		1,323,903		1,267,618
Advances from FHLB		340,805		335,689		335,324		336,143
Federal funds purchased		23,712		23,712		-		-
Term notes		3,583		3,708		3,638		3,663
Subordinated capital notes		87,240		100,404		99,316		100,010
Accrued expenses and other liabilities		140,037		140,037		144,424		144,424

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

The following methods and assumptions were used to estimate the fair values of significant financial instruments at March 31, 2014 and December 31, 2013:

•     Cash and cash equivalents (including money market investments and time deposits with other banks), restricted cash, accrued interest receivable, securities purchased under agreements to resell, securities sold but not yet delivered, accrued expenses and other liabilities have been valued at the carrying amounts reflected in the consolidated statements of financial condition as these are reasonable estimates of fair value given the short-term nature of the instruments.

•     Investments in FHLB-NY stock are valued at their redemption value.

•     The fair value of investment securities, including trading securities, is based on quoted market prices, when available, or market prices provided by recognized broker-dealers. If listed prices or quotes are not available, fair value is based upon externally developed models that use both observable and unobservable inputs depending on the market activity of the instrument. The estimated fair value of the structured credit investments is determined by using a third-party cash flow valuation model to calculate the present value of projected future cash flows. The assumptions used which are highly uncertain and require a high degree of judgment, include primarily market discount rates, current spreads, duration, leverage, default, home price depreciation, and loss rates. The assumptions used are drawn from a wide array of data sources, including the performance of the collateral underlying each deal. The external-based valuation, which is obtained at least on a quarterly basis, is analyzed and its assumptions are evaluated and incorporated in either an internal-based valuation model when deemed necessary, or compared to counterparties’ prices and agreed by management.

•     The fair value of the FDIC shared-loss indemnification asset represents the present value of the net estimated cash payments expected to be received from the FDIC for future losses on covered assets based on the credit assumptions on estimated cash flows for each covered asset pool and the loss sharing percentages. The ultimate collectability of the FDIC shared-loss indemnification asset is dependent upon the performance of the underlying covered loans, the passage of time and claims paid by the FDIC which are impacted by the Bank’s adherence to certain guidelines established by the FDIC.

•     The fair value of servicing assets is estimated by using a cash flow valuation model which calculates the present value of estimated future net servicing cash flows, taking into consideration actual and expected loan prepayment rates, discount rates, servicing costs, and other economic factors, which are determined based on current market conditions.

•     The fair values of the derivative instruments are provided by valuation experts and counterparties. Certain derivatives with limited market activity are valued using externally developed models that consider unobservable market parameters. The Company has offered its customers certificates of deposit with an option tied to the performance of the S&P Index, and uses equity indexed option agreements with major broker-dealers to manage its exposure to changes in this index. Their fair value is obtained through the use of an external based valuation that was thoroughly evaluated and adopted by management as its measurement tool for these options. The payoff of these options is linked to the average value of the S&P Index on a specific set of dates during the life of the option. The methodology uses an average rate option or a cash-settled option whose payoff is based on the difference between the expected average value of the S&P Index during the remaining life of the option and the strike price at inception. The assumptions, which are uncertain and require a degree of judgment, include primarily S&P Index volatility, forward interest rate projections, estimated index dividend payout, and leverage.

•     Fair value of derivative liabilities, which include interest rate swaps and forward-settlement swaps, are based on the net discounted value of the contractual projected cash flows of both the pay-fixed receive-variable legs of the contracts. The projected cash flows are based on the forward yield curve, and discounted using current estimated market rates.

•     The fair value of the covered and non-covered loan portfolio (including loans held-for-sale) is estimated by segregating by type, such as mortgage, commercial, consumer, auto and leasing. Each loan segment is further segmented into fixed and adjustable interest rates and by performing and non-performing categories. The fair value of performing loans is calculated by discounting contractual cash flows, adjusted for prepayment estimates (voluntary and involuntary), if any, using estimated current market discount rates that reflect the credit and interest rate risk inherent in the loan. This fair value is not currently an indication of an exit price as that type of assumption could result in a different fair value estimate.

•     The fair value of demand deposits and savings accounts is the amount payable on demand at the reporting date. The fair value of fixed-maturity certificates of deposit is based on the discounted value of the contractual cash flows, using estimated current market discount rates for deposits of similar remaining maturities.

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

•     For short term borrowings and federal funds purchased, the carrying amount is considered a reasonable estimate of fair value. The fair value of long-term borrowings, which include securities sold under agreements to repurchase, advances from FHLB-NY, FDIC-guaranteed term notes, other term notes, and subordinated capital notes, is based on the discounted value of the contractual cash flows using current estimated market discount rates for borrowings with similar terms, remaining maturities and put dates.

•     The fair value of commitments to extend credit and unused lines of credit is based on fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the counterparties’ credit standings.

NOTE 18 –  BUSINESSSEGMENTS 

The Company segregates its businesses into the following major reportable segments of business: Banking, Wealth Management, and Treasury. Management established the reportable segments based on the internal reporting used to evaluate performance and to assess where to allocate resources. Other factors such as the Company’s organization, nature of its products, distribution channels and economic characteristics of the products were also considered in the determination of the reportable segments. The Company measures the performance of these reportable segments based on pre-established goals of different financial parameters such as net income, net interest income, loan production, and fees generated. The Company’s methodology for allocating non-interest expenses among segments is based on several factors such as revenue, employee headcount, occupied space, dedicated services or time, among others. These factors are reviewed on a periodical basis and may change if the conditions warrant. 

Banking includes the Bank’s branches and traditional banking products such as deposits and commercial, consumer and mortgage loans. Mortgage banking activities are carried out by the Bank’s mortgage banking division, whose principal activity is to originate mortgage loans for the Company’s own portfolio. As part of its mortgage banking activities, the Company may sell loans directly into the secondary market or securitize conforming loans into mortgage-backed securities.

Wealth Management is comprised of the Bank’s trust division, Oriental Financial Services, Oriental Insurance, and CPC. The core operations of this segment are financial planning, money management and investment banking, brokerage services, insurance sales activity, corporate and individual trust and retirement services, as well as pension plan administration services.

The Treasury segment encompasses all of the Company’s asset/liability management activities, such as purchases and sales of investment securities, interest rate risk management, derivatives, and borrowings. Intersegment sales and transfers, if any, are accounted for as if the sales or transfers were to third parties, that is, at current market prices.

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

Following are the results of operations and the selected financial information by operating segment as of and for the quarters ended March 31, 2014 and 2013:

	Quarter Ended March 31, 2014
			Wealth				Total Major				Consolidated
	Banking		Management		Treasury		Segments		Eliminations		Total
	(In thousands)
Interest income	$	108,631	$	40	$	14,403	$	123,074	$	-	$	123,074
Interest expense		(7,516)		-		(12,160)		(19,676)		-		(19,676)
Net interest income		101,115		40		2,243		103,398		-		103,398
Provision for non-covered    loan and lease losses		(10,062)		-		-		(10,062)		-		(10,062)
Provision for covered    loan and lease losses		(1,629)		-		-		(1,629)		-		(1,629)
Non-interest income (loss)		(5,047)		6,522		3,803		5,278		-		5,278
Non-interest expenses		(53,596)		(4,779)		(3,078)		(61,453)		-		(61,453)
Intersegment revenue		544		-		-		544		(544)		-
Intersegment expenses		-		(432)		(112)		(544)		544		-
Income before income taxes	$	31,325	$	1,351	$	2,856	$	35,532	$	-	$	35,532
Total assets	$	7,351,839	$	24,345	$	1,643,569	$	9,019,753	$	(1,164,115)	$	7,855,638

	Quarter Ended March 31, 2013
			Wealth				Total Major				Consolidated
	Banking		Management		Treasury		Segments		Eliminations		Total
	(In thousands)
Interest income	$	102,068	$	86	$	12,018	$	114,172	$	-	$	114,172
Interest expense		(6,971)		(60)		(13,525)		(20,556)		-		(20,556)
Net interest income		95,097		26		(1,507)		93,616		-		93,616
Provision for non-covered loan and lease losses		(7,916)		-		-		(7,916)		-		(7,916)
Provision for covered loan and lease losses, net		(672)		-		-		(672)		-		(672)
Non-interest income(loss)		2,537		7,700		(138)		10,099		-		10,099
Non-interest expenses		(61,932)		(4,462)		(415)		(66,809)		-		(66,809)
Intersegment revenue		383		-		-		383		(383)		-
Intersegment expenses		-		(302)		(81)		(383)		383		-
Income before income taxes	$	27,497	$	2,962	$	(2,141)	$	28,318	$	-	$	28,318
Total assets	$	6,989,744	$	39,511	$	2,539,649	$	9,568,904	$	(866,353)	$	8,702,551

70

ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

INTRODUCTION

The following discussion of the Company’s financial condition and results of operations should be read in conjunction with the “Selected Financial Data” and the Company’s unaudited consolidated financial statements and related notes. This discussion and analysis contains forward-looking statements. Please see “Forward-Looking Statements” and the risk factors set forth in our 2013 Form 10-K for the year ended December 31, 2013 (the “2013 Form 10-K”), for discussion of the uncertainties, risks and assumptions associated with these statements.

The Company is a publicly-owned financial holding company that provides a full range of banking and financial services through its subsidiaries, including commercial, consumer, auto and mortgage lending; checking and savings accounts; financial planning, insurance and securities brokerage services; and corporate and individual trust and retirement services. The Company operates through three major business segments: Banking, Financial Services, and Treasury, and distinguishes itself based on quality service. The Company has 55 branches in Puerto Rico and a subsidiary in Boca Raton, Florida. The Company’s long-term goal is to strengthen its banking and financial services franchise by expanding its lending businesses, increasing the level of integration in the marketing and delivery of banking and financial services, maintaining effective asset-liability management, growing non-interest revenue from banking and financial services, and improving operating efficiencies.

The Company’s diversified mix of businesses and products generates both the interest income traditionally associated with a banking institution and non-interest income traditionally associated with a financial services institution (generated by such businesses as securities brokerage, fiduciary services, investment banking, insurance agency, and retirement plan administration). Although all of these businesses, to varying degrees, are affected by interest rate and financial market fluctuations and other external factors, the Company’s commitment is to continue producing a balanced and growing revenue stream.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The preparation of financial statements in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”) requires management to make a number of judgments, estimates and assumptions that affect the reported amount of assets, liabilities, income and expenses in the consolidated financial statements. Understanding our accounting policies and the extent to which we use management judgment and estimates in applying these policies is integral to understanding our financial statements. We provide a summary of our significant accounting policies in “Note 1—Summary of Significant Accounting Policies” of our annual report on the 2013 Form 10-K.

In the “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates” section of our 2013 Form 10-K, we identified the following accounting policies as critical because they require significant judgments and assumptions about highly complex and inherently uncertain matters and the use of reasonably different estimates and assumptions could have a material impact on our reported results of operations or financial condition:

• Business combination

• Allowance for loan and lease losses

• Financial instruments

We evaluate our critical accounting estimates and judgments on an ongoing basis and update them as necessary based on changing conditions. Management has reviewed and approved these critical accounting policies and has discussed its judgments and assumptions with the Audit and Compliance Committee of our Board of Directors. As part of the Company’s continuous enhancement to the allowance for loan and lease losses methodology, during the quarter ended March 31, 2014, an assessment of the look-back period and historical loss factor was performed for auto and leasing and consumer loan portfolios based on the trends observed and their relation with the economic cycle as of the period ended March 31, 2014. As a result, the period was changed to 24 months from the previously determined 12 months. This change in the allowance for loan and lease losses’ look back period for the consumer and auto and leasing portfolios is considered a change in accounting estimate as per ASC 250-10 provisions, where adjustments should be made prospectively. Apart from this change, there have been no other material changes in the methods used to formulate these critical accounting estimates from those discussed in our 2013 Form 10-K.

71

OVERVIEW OF FINANCIAL PERFORMANCE

SELECTED FINANCIAL DATA
	Quarter Ended March 31,
					Variance
	2014		2013		%
EARNINGS DATA:	(In thousands, except per share data)
Interest income	$	123,074	$	114,172	7.8%
Interest expense		19,676		20,556	-4.3%
Net interest income		103,398		93,616	10.4%
Provision for non-covered loan and lease losses		10,062		7,916	27.1%
Provision for covered loan and lease losses, net		1,629		672	142.4%
Total provision for loan and lease losses, net		11,691		8,588	36.1%
Net interest income after provision for loan             and lease losses		91,707		85,028	7.9%
Non-interest income		5,278		10,099	-47.7%
Non-interest expenses		61,453		66,809	-8.0%
Income before taxes		35,532		28,318	25.5%
Income tax expense (benefit)		11,785		7,126	65.4%
Net income		23,747		21,192	12.1%
Less: dividends on preferred stock		(3,465)		(3,465)	153.0%
Income available to common shareholders	$	20,282	$	17,727	14.4%
PER SHARE DATA:
Basic	$	0.45	$	0.39	15.4%
Diluted	$	0.42	$	0.37	13.5%
Average common shares outstanding		45,329		45,595	-0.6%
Average common shares outstanding and equivalents		52,598		52,898	-0.6%
Cash dividends declared per common share	$	0.08	$	0.06	0.0%
Cash dividends declared on common shares	$	3,657	$	2,737	33.6%
PERFORMANCE RATIOS:
Return on average assets (ROA)		1.18%		0.96%	22.9%
Return on average tangible common equity		12.86%		11.92%	7.9%
Return on average common equity (ROE)		11.13%		10.20%	9.1%
Equity-to-assets ratio		11.41%		9.98%	14.4%
Efficiency ratio		50.03%		57.46%	-12.9%
Interest rate spread		5.87%		4.91%	19.6%
Interest rate margin		5.90%		4.90%	20.4%

72

SELECTED FINANCIAL DATA - (Continued)
	March 31,		December 31,		Variance
	2014		2013		%
PERIOD END BALANCES AND CAPITAL RATIOS:	(In thousands, except per share data)
Investments and loans
Investments securities	$	1,482,090	$	1,614,809	-8.2%
Loans and leases not covered under shared-loss         agreements with the FDIC, net		4,654,749		4,662,458	-0.2%
Loans and leases covered under shared-loss         agreements with the FDIC, net		347,865		356,961	-2.5%
Total investments and loans	$	6,484,704	$	6,634,228	-2.3%
Deposits and borrowings
Deposits	$	5,300,992	$	5,383,265	-1.5%
Securities sold under agreements to repurchase		1,012,240		1,267,618	-20.1%
Other borrowings		463,513		439,816	5.4%
Total deposits and borrowings	$	6,776,745	$	7,090,699	-4.4%
Stockholders’ equity
Preferred stock	$	176,000	$	176,000	0.0%
Common stock		52,714		52,707	0.0%
Additional paid-in capital		538,287		538,071	0.0%
Legal surplus		64,292		61,957	3.8%
Retained earnings		147,919		133,629	10.7%
Treasury stock, at cost		(90,743)		(80,642)	-12.5%
Accumulated other comprehensive income		8,022		3,191	151.4%
Total stockholders' equity	$	896,491	$	884,913	1.3%
Per share data
Book value per common share	$	16.23	$	15.74	3.1%
Tangible book value per common share	$	14.07	$	13.60	3.5%
Market price at end of period	$	17.19	$	17.34	-0.9%
Capital ratios
Leverage capital		9.51%		9.11%	4.4%
Tier 1 risk-based capital		14.76%		14.35%	2.9%
Total risk-based capital		16.56%		16.14%	2.6%
Tier 1 common equity to risk-weighted assets		10.79%		10.44%	3.4%
Financial assets managed
Trust assets managed	$	2,797,778	$	2,796,923	0.0%
Broker-dealer assets gathered	$	2,576,991	$	2,493,324	3.4%

73

FINANCIAL HIGHLIGHTS

Income available to common shareholders for the quarter ended March 31, 2014, increased to $20.3 million, or $0.42 per diluted share, when compared to the same period in 2013.

During the quarter ended March 31, 2014, the Company’s return on assets was 1.18% and its return on equity was 11.13%. The Company improved its efficiency ratio, which decreased to 50.03% from 57.46% when compared with the same period in 2013.

Operating revenues for the quarter ended March 31, 2014 increased 4.8%, or $5.0 million, to $108.7 million when compared to the same period in 2013.

	Quarter Ended March 31,
	2014		2013
	(In thousands)
OPERATING REVENUE
Net interest income	$	103,398	$	93,616
Non-interest income		5,278		10,099
Total operating revenue	$	108,676	$	103,715

Interest Income

Total interest income for the quarter ended March 31, 2014 increased 7.8% to $123.1 million, as compared to the same period in 2013. This was mainly related to an increase in interest income from loans of $7.6 million, or 7.5% when compared to the same period in 2013. The yield on covered loans increased from 20.98% in the quarter ended March 31, 2013 to 26.68% for the quarter ended March 31, 2014. This increase in yield is the result of higher projected cash flows on certain pools of covered loans, as credit losses have been lower than initially estimated for these pools. The covered portfolio is having cost recoveries on pools with lower carrying amounts, and these have the effect of increasing net interest income. In addition, the yield on non-covered loans increased from 6.98% in the quarter ended March 31, 2013 to 7.43% for the quarter ended March 31, 2014.

Interest income from investments reflects a 9.9% increase for the quarter ended March 31, 2014, as compared to the same period in 2013. The increase is mainly due to the increase in the investments yield to 2.79% for the quarter ended March 31, 2014 as compared to 2.0% for the same period in 2013 driven by lower premium amortization.

Interest Expense

Total interest expense for the quarter ended March 31, 2014, decreased 4.3% to $19.7 million, as compared to the quarter ended March 31, 2013. This reflects the lower cost of deposits (0.68% vs. 72%) for the quarter ended March 31, 2014, as compared to the same period in 2013. Such lower cost reflects continuing progress in the repricing of the Company’s core retail deposits.  

Net Interest Income

Net interest income for the quarter ended March 31, 2014, was $103.4 million, an increase of 10.4% when compared with the same period in 2013. The increase was mostly due the net effect of a 7.8% increase in total interest income and a decrease of 4.3% in interest expense due to lower cost of funds. Net interest margin of 5.90% for the quarter ended March 31, 2014, increased 100 basis points when compared to the quarter ended March 31, 2013.

Provision for Loan and Lease Losses

Provision for non-covered loans losses for the quarter ended March 31, 2014 increased $2.1 million when compared to the quarter ended March 31, 2013. Provision for covered loans losses for the quarter ended March 31, 2014 increased $957 thousand when compared to the quarter ended March 31, 2013.

74

Non-Interest Income

During the first quarter of 2014, core banking and financial services revenues decreased 14.3% to $19.4 million as compared to the quarter ended March 31, 2013, primarily reflecting a $1.2 million decrease in both, banking services revenue to $10.6 million and mortgage banking activities to $2.0 million for the first quarter of 2014. Decrease in banking services revenues is mostly due to the reclassification of loan late charges into interest income. Decrease in mortgage banking activities is mainly due to higher losses in repurchased loans, lower cost or market adjustment made to mortgage loans held for sale during such quarter of 2014 and decrease in sales, when compared to same period in 2013.

The FDIC shared-loss expense of $18.5 million for the first quarter of 2014 compared to $12.9 million for the first quarter of 2013, resulted from the ongoing evaluation of expected cash flows of the covered loan portfolio, which resulted in reduced projected losses expected to be collected from the FDIC and the improved accretable yield on the covered loans. During the quarter ended March 31, 2014, the net amortization included $3.5 million of additional amortization of the FDIC indemnification asset from stepped up cost recoveries on certain construction and leasing loan pools.

Results from the quarter ended March 31, 2014 included a gain on sale of securities of $4.4 million. During the quarter ended March 31, 2013, the Company did not have any gain or loss on sale of securities. Losses from derivative activities were $478 thousand for the quarter ended March 31, 2014, compared to $788 thousand for the same period in 2013. There was no gain or loss on extinguishment of debt for the quarter ended March 31 2014, compared to a gain of $1.1 million for the same period in 2013.

Non-Interest Expense

Non-interest expense for the quarter ended March 31, 2014 decreased to $61.5 million, compared to $66.8 million for the same period in 2013. During the quarter ended March 31 2014, there were no merger and restructuring charges compared to $5.5 million for the same period in 2013. The efficiency ratio for the first quarter of 2014 was 50.03% compared to 57.46% for the same period in 2013 driven mostly by a decrease in non-interest expenses and an increase in net income.

Income Tax Expense

Income tax expense was $11.8 million for the first quarter of 2014 compared to $7.1 million for the first quarter of 2013. The increase for the first quarter of 2014 was primarily due to the recent amendments to the Puerto Rico tax code that increases the corporate income tax rate to 39% from 30%.

Income Available to Common Shareholders

For the first quarter of 2014, the Company’s income available to common shareholders amounted to $20.3 million compared to $17.7 million for the first quarter of 2013. Income per basic common share and fully diluted common share was $0.45 and $0.42, respectively, for the first quarter of 2014, compared to income per basic common share and fully diluted common share of $0.39 and $0.37, respectively, for the first quarter of 2013.

Interest Earning Assets

The loan portfolio declined to $5.003 billion at March 31, 2014, compared to $5.019 billion at December 31, 2013, primarily due to the early pay down of some commercial loans. The investment portfolio of $1.482 billion at March 31, 2014 decreased 8.2% compared to $1.615 billion at December 31, 2013. During the quarter ended March 31, 2014, the Company sold $110.8 million of mortgage-backed available for sale securities taking advantage of market opportunities to realize gains and reduce some interest rate sensitivity.

Interest Bearing Liabilities

Total deposits amounted to $5.301 billion at March 31, 2014, a decrease of 1.5% compared to $5.383 billion at December 31, 2013. Non-maturing deposit balances increased 3.7%, to $3.5 billion, while higher-priced time deposits declined 10.0% as part of efforts to reduce the cost of deposits, which averaged 0.68% at March 31, 2014 compared to 0.72% at March 31, 2013. Securities sold under agreements to repurchase decreased 20.1%, or $255.3 million, as the Company used available cash to pay off $255.0 million of repurchase agreements at maturity.

75

Stockholders’ Equity

Stockholders’ equity at March 31, 2014 was $896.5 million compared to $884.9 million at December 31, 2013, an increase of 1.3%. This increase reflects the net income for the first quarter of 2014 and an increase in other comprehensive income, partially offset by treasury stock repurchases.

Book value per share was $16.23 at March 31, 2014 compared to $15.74 at December 31, 2013.

The Company maintains capital ratios in excess of regulatory requirements. At March 31, 2014, Tier 1 Leverage Capital Ratio was 9.51%, Tier 1 Risk-Based Capital Ratio was 14.76%, and Total Risk-Based Capital Ratio was 16.56%.

Return on Average Assets and Common Equity

Return on average common equity (“ROE”) for the quarter ended March 31, 2014 was 11.13% compared to 10.20% for the quarter ended March 31, 2013. Return on average assets (“ROA”) for the quarter ended March 31, 2014 was 1.18% compared to 0.96% for the same period in 2013. The increases in ROE and ROA are mostly due to 12.1% increase in net income from $21.2 million in the quarter ended March 31, 2013 to $23.7 million in the quarter ended March 31, 2014, and to the decrease of 8.0% in average assets and 4.8% in average common equity from the same period in 2013.

Assets under Management

At March 31, 2014, total assets managed by the Company’s trust division and CPC remained leveled at $2.798 billion compared to December 31, 2013. At March 31, 2014, total assets managed by the securities broker-dealer subsidiary from its customer investment accounts increased 3.4% to $2.577 billion, compared to $2.493 billion at December 31, 2013. Changes in trust and broker-dealer related assets primarily reflect a slight increase in portfolio and differences in market values.

Lending

Total loan production of $212.0 million for the quarter ended March 31, 2014 decreased 22.8% from the quarter ended March 31, 2013. Generally, loan demand for the quarter ended March 31, 2014 was lower compared to the same period of 2013. Total commercial loan production of $39.8 million for the quarter ended March 31, 2014, decreased 46.3% from $77.1 million in the quarter ended March 31, 2013.

Mortgage loan production of $50.8 million for the quarter ended March 31, 2014 decreased 34.1% from the quarter ended March 31, 2013. The Company sells most of its conforming mortgage loans in the secondary market and retains the servicing rights.

In the aggregate, consumer loan and auto and leasing production for the quarter ended March 31, 2014, totaled $121.4 million, a slight decrease of 1.8% from the quarter ended March 31, 2013.

Total loan portfolio declined by $16.8 million from $5.019 billion at December 31, 2013 to $5.002 billion at March 31, 2014, mostly as the result of scheduled pay downs and maturities in both the non-covered and covered loan portfolios.

Credit Quality on Non-Covered Loans

Net credit losses, excluding acquired loans, increased $1.8 million to $5.2 million for the quarter ended March 31, 2014, representing 0.86% of average non-covered loans outstanding versus 1.06% for the quarter ended March 31, 2013. The allowance for loan and lease losses on non-covered loans at March 31, 2014, increased to $56.2 million compared to $54.3 million at December 31, 2013. The allowances for loan and lease losses, excluding acquired loans, increased to $49.5 million (1.95% of total non-covered loans, excluding acquired loans) at March 31, 2014, compared to $49.1 million (2.4% of total non-covered loans, excluding acquired loans) at December 31, 2013. The allowance for loan and lease losses on acquired loans accounted for under ASC 310-20 increased to $3.6 million at March 31, 2014, compared to $2.4 million at December 31, 2014.

Non-performing loans (“NPLs”), which exclude loans covered under shared-loss agreements with the FDIC and loans acquired in the BBVAPR Acquisition accounted under ASC 310-30, increased to $88.2 million at March 31, 2014 compared to $86.2 million at December 31, 2013. The increase is due mainly to increase in non-performing consumer and auto loans.

76

Non-GAAP Measures

The Company uses certain non-GAAP measures of financial performance to supplement the unaudited consolidated financial statements presented in accordance with GAAP. The Company presents non-GAAP measures that management believes are useful and meaningful to investors. Non-GAAP measures do not have any standardized meaning, are not required to be uniformly applied, and are not audited. Therefore, they are unlikely to be comparable to similar measures presented by other companies. The presentation of non-GAAP measures is not intended to be a substitute for, and should not be considered in isolation from, the financial measures reported in accordance with GAAP.

The Company’s management has reported and discussed the results of operations herein both on a GAAP basis and on a pre-tax pre-provision operating income basis (defined as net interest income, plus banking and financial services revenue, less non-interest expenses, as calculated on the table below). The Company’s management believes that, given the nature of the items excluded from the definition of pre-tax pre-provision operating income, it is useful to state what the results of operations would have been without them so that investors can see the financial trends from the Company’s continuing business.

During the quarter ended March 31, 2014, the Company’s pre-tax pre-provision operating income was approximately $61.4 million, an increase of 11.6% from $55.0 million for the same quarter in 2013. Pre-tax pre-provision operating income is calculated as follows:

	Quarter Ended March 31,
	2014		2013
	(In thousands)
PRE-TAX PRE-PROVISION OPERATING INCOME
Net interest income	$	103,398	$	93,616
Core non-interest income:
Banking service revenue		10,606		11,838
Financial service revenue		6,867		7,660
Mortgage banking activities		1,950		3,153
Total core non-interest income		19,423		22,651
Non-interest expenses		61,453		66,809
Less merger and restructuring charges		-		(5,534)
		61,453		61,275
Total pre-tax pre-provision operating income	$	61,368	$	54,992

Tangible common equity consists of common equity less goodwill, core deposit intangibles and customer relationship intangible. Tier 1 common equity consists of common equity less goodwill, core deposit intangibles, net unrealized gains on available for sale securities, net unrealized losses on cash flow hedges, and disallowed deferred tax asset and servicing assets. Tangible book value per common share consists of tangible common equity divided by common stock outstanding at the end of the period. Ratios of tangible common equity to total assets, tangible common equity to risk-weighted assets, total equity to risk-weighted assets, and Tier 1 common equity to risk-weighted assets and tangible book value per common share are non-GAAP measures.

At March 31, 2014, tangible common equity to total assets and tangible common equity to risk-weighted assets increased to 8.06% and 12.54%, respectively, from 7.61% and 12.10%, respectively, at December 31, 2013. Total equity to risk-weighted assets and Tier 1 common equity to risk-weighted assets at March 31, 2014 increased to 17.75% and 10.79%, respectively, from 17.23% and 10.44%, respectively, at December 31, 2013.

Ratios calculated based upon Tier 1 common equity have become a focus of regulators and investors, and management believes ratios based on Tier 1 common equity assist investors in analyzing the Company’s capital position. Furthermore, management and many stock analysts use tangible common equity in conjunction with more traditional bank capital ratios to compare the capital adequacy of banking organizations. Neither Tier 1 common equity nor tangible common equity or related measures should be considered in isolation or as a substitute for stockholders’ equity, total assets or any other measure calculated in accordance with GAAP.

77

ANALYSIS OF RESULTS OF OPERATIONS

The following tables show major categories of interest-earning assets and interest-bearing liabilities, their respective interest income, expenses, yields and costs, and their impact on net interest income due to changes in volume and rates for the quarters ended March 31, 2014 and 2013:

TABLE 1 - QUARTERLY ANALYSIS OF NET INTEREST INCOME AND CHANGES DUE TO VOLUME/RATE
FOR THE QUARTERS ENDED MARCH 31, 2014 AND 2013
	Interest				Average rate		Average balance
	March		March		March	March	March		March
	2014		2013		2014	2013	2014		2013
	(Dollars in thousands)
A - TAX EQUIVALENT SPREAD
Interest-earning assets	$	123,074	$	114,172	7.02%	5.98%	$	7,108,864	$	7,747,452
Tax equivalent adjustment		10,134		7,090	0.58%	0.37%		-		-
Interest-earning assets - tax equivalent		133,208		121,262	7.60%	6.35%		7,108,864		7,747,452
Interest-bearing liabilities		19,676		20,556	1.15%	1.07%		6,965,299		7,792,327
Tax equivalent net interest income / spread		113,532		100,706	6.45%	5.28%		143,565		(44,875)
Tax equivalent interest rate margin					6.48%	5.27%
B - NORMAL SPREAD
Interest-earning assets:
Investments:
Investment securities		14,122		12,809	3.54%	2.47%		1,617,135		2,107,361
Trading securities		38		19	8.18%	9.74%		1,885		791
Interest bearing cash and money market investments		283		308	0.24%	0.23%		482,497		551,242
Total investments		14,443		13,136	2.79%	2.00%		2,101,517		2,659,394
Loans not covered under shared-loss agreements     with the FDIC:
Originated
Mortgage		10,458		11,427	5.63%	6.26%		753,248		740,072
Commercial		14,417		4,890	5.21%	5.32%		1,121,953		372,941
Consumer		3,139		1,212	9.93%	8.34%		128,239		58,908
Auto and leasing		10,989		2,845	10.66%	11.65%		418,074		99,048
Total originated non-covered loans		39,003		20,374	6.53%	6.50%		2,421,514		1,270,968
Acquired
Mortgage		9,369		11,170	5.33%	5.71%		713,345		793,274
Commercial		18,769		26,597	10.30%	7.32%		738,910		1,474,420
Consumer		4,089		5,871	12.79%	12.53%		129,665		190,013
Auto		14,013		16,795	8.76%	7.03%		648,382		968,380
Total acquired non-covered loans		46,240		60,433	8.41%	7.15%		2,230,301		3,426,087
Total non-covered loans		85,243		80,807	7.43%	6.98%		4,651,816		4,697,055
Loans covered under shared loss agreements with the FDIC		23,388		20,229	26.68%	20.98%		355,531		391,002
Total loans		108,631		101,036	8.80%	8.05%		5,007,347		5,088,057
Total interest earning assets		123,074		114,172	7.02%	5.98%		7,108,864		7,747,451

78

	Interest					Average rate		Average balance
	March		March			March	March	March		March
	2014		2013			2014	2013	2014		2013
	(Dollars in thousands)
Interest-bearing liabilities:
Deposits:
Non-interest bearing deposits		-		-		0.00%	0.00%		499,384		766,233
Now Accounts		2,324		3,739		0.57%	1.04%		1,661,244		1,453,622
Savings and money market		2,296		1,807		0.83%	0.85%		1,126,987		859,254
Individual retirement accounts		1,058		1,367		1.25%	1.49%		343,762		372,929
Retail certificates of deposits		1,939		3,189		1.37%	1.87%		572,054		692,899
Total core deposits		7,617		10,102		0.73%	0.99%		4,203,431		4,144,937
Institutional deposits		1,408		2,696		1.51%	1.85%		377,528		592,340
Brokered deposits		1,516		1,989		0.82%	0.94%		751,558		856,451
Total wholesale deposits		2,924		4,685		1.05%	1.31%		1,129,086		1,448,791
Deposits fair value premium amortization		(1,898)		(5,267)		0.00%	0.00%		-		-
Core deposit intangible amortization		335		415		0.00%	0.00%		-		-
Total deposits		8,978		9,935		0.68%	0.72%		5,332,517		5,593,728
Borrowings:
Securities sold under agreements to repurchase		7,411		7,248		2.60%	1.93%		1,156,747		1,525,575
Advances from FHLB and other borrowings		2,295		1,713		2.48%	1.31%		375,862		529,365
Subordinated capital notes		992		1,660		4.02%	4.69%		100,173		143,659
Total borrowings		10,698		10,621		2.66%	1.96%		1,632,782		2,198,599
Total interest bearing liabilities		19,676		20,556		1.15%	1.07%		6,965,299		7,792,327
Net interest income / spread	$	103,398	$	93,616		5.87%	4.91%
Interest rate margin						5.90%	4.90%
Excess of average interest-earning assets     over average interest-bearing liabilities								$	143,565	$	(44,876)
Average interest-earning assets to average     interest-bearing liabilities ratio									102.06%		99.42%
C - CHANGES IN NET INTEREST INCOME DUE TO:
	Volume		Rate		Total
	(In thousands)
Interest Income:
Investments	$	(2,756)	$	4,063	$	1,307
Loans		(2,613)		10,208		7,595
Total interest income		(5,369)		14,271		8,902
Interest Expense:
Deposits		(464)		(493)		(957)
Repurchase agreements		(1,752)		1,915		163
Other borrowings		(987)		901		(86)
Total interest  expense		(3,203)		2,323		(880)
Net Interest Income	$	(2,166)	$	11,948	$	9,782

79

Net Interest Income

Net interest income amounted to $103.4 million for the first quarter of 2014, a 10.4% increase from $93.6 million in the first quarter of 2013. These changes reflect a decrease of 4.3% in interest expense and an increase of 7.5% in interest income from loans and of 9.9% in interest income from investment securities when comparing both quarters.

Interest rate spread for the first quarter of 2014, increased 96 basis points to 5.87% from 4.91% in the same period for 2013. This increase is mainly due to the net effect of a 104 basis point increase in the average yield of interest-earning assets from 5.98% to 7.02%, and an 8 basis point decrease in the average cost of funds from 1.07% to 1.15%.

The increase in interest income was primarily the result of an increase of $14.3 million in interest rate partially offset by a $5.4 million decrease in volume of interest-earning assets. Interest income from loans increased 7.5% to $108.6 million for the quarter ended March 31, 2014. Interest income from investments increased 9.9% to $14.4 million for the quarter ended March 31, 2014, reflecting a lower premium amortization in the investment securities portfolio as conditional prepayment rates “CPRs” on mortgage-backed securities fell. 

Interest expense decreased 4.3% to $19.7 million for the quarter ended March 31, 2014. The decrease was primarily the result of a $3.2 million decrease in volume of interest-bearing liabilities, partially offset by a $2.3 million increase in interest rate. The decrease in interest-bearing liabilities is mostly due to the decrease in repurchase agreement volume of $1.8 million during the first quarter of 2014, as the Company repaid $255 million of repurchase agreements at maturity. The increase in interest rate is due to an increase in the cost of borrowings, which increased 70 basis points to 2.66% in the first quarter of 2014, compared to 1.96% for the first quarter of 2013. The cost of deposits decreased 4 basis points to 0.68% for the first quarter of 2014, compared to 0.72% for the first quarter of 2013, primarily due to continuing progress in repricing core deposits and to the maturity of higher cost brokered deposits and time deposits during the period.

For the quarter ended March 31, 2014, the average balance of total interest-earning assets was $7.109 billion, a decrease of 8.2% from the quarter ended March 31, 2013. The decrease in average balance of interest-earning assets was mainly attributable to a decrease of 21.0% in average investments for the quarter ended March 31, 2014, resulting from redemptions and maturities and to the sale of available for sale securities during the current quarter amounting to $110.8 million, and a reduction of 1.6% in the average loan portfolio for the quarter ended March 31, 2014, primarily due to the early paydown of some commercial loans. For the quarter ended March 31, 2014, the average yield on interest-earning assets was 7.02% compared to 5.98% for the same quarter in 2013. This was mainly due to higher average yields in the covered and non-covered loan portfolios, which their average yield increased to 26.68% and 7.43%, respectively, for the quarter ended March 31, 2014, compared to 20.98% and 6.98 % for the quarter ended March 31, 2013.

80

TABLE 2 - NON-INTEREST INCOME SUMMARY
	Quarter Ended March 31,
	2014		2013		Variance
	(Dollars in thousands)
Banking service revenue	$	10,606	$	11,838	-10.4%
Financial service revenue		6,867		7,660	-10.4%
Mortgage banking activities		1,950		3,153	-38.2%
Total banking and financial service revenue		19,423		22,651	-14.3%
FDIC shared-loss expense, net		(18,487)		(12,871)	-43.6%
Sale of securities available for sale		4,366		-	100.0%
Derivatives		(478)		(788)	39.3%
Early extinguishment of debt		-		1,061	-100.0%
Other non-interest income		454		46	887.0%
		(14,145)		(12,552)	-12.7%
Total non-interest income, net	$	5,278	$	10,099	-47.7%

Non-Interest Income

Non-interest income is affected by the level of trust assets under management, transactions generated by clients’ financial assets serviced by the securities broker-dealer and insurance agency subsidiaries, the level of mortgage banking activities, and the fees generated from loans and deposit accounts. It is also affected by the FDIC shared-loss expense, which varies depending on the results of the on-going evaluation of expected cash flows of the loan portfolio acquired in the FDIC-assisted acquisition. In addition, it is affected by the amount of securities, derivatives and trading transactions.

As shown in Table 2 above, the Company recorded non-interest income in the amount of $5.3 million for the quarter ended March 31, 2014, compared to $10.1 million for the quarter ended March 31, 2014, a decrease of $4.8 million.

FDIC shared-loss expense increased to $18.5 million for the quarter ended March 31, 2014, compared to $12.9 million for the quarter ended March 31, 2013, resulted from the ongoing evaluation of expected cash flows of the covered loan portfolio, which resulted in reduced projected losses expected to be collected from the FDIC and the improved accretable yield on the covered loans. The reduction in claimable losses amortizes the shared-loss indemnification asset through the life of the shared loss agreements. This amortization is net of the accretion of the discount recorded to reflect the expected claimable loss at its net present value. During the quarter ended March 31, 2014, the net amortization included $3.5 million of additional amortization of the FDIC indemnification asset from stepped up cost recoveries on certain construction and leasing loan pools. Additional amortization of the FDIC indemnification asset may be recorded, should the Company continue to experience reduced expected losses. The majority of the FDIC indemnification asset is recorded for projected claimable losses on non-single family residential loans whose loss share period ends by the second quarter of 2015, although the recovery share period extends for an additional three-year period.

Banking service revenue, which consists primarily of fees generated by deposit accounts, electronic banking services, and customer services, decreased 10.4% to $10.6 million for the quarter ended March 31, 2014, from $11.8 million for the quarter ended March 31, 2013. Decrease in banking services revenues is mostly due to the reclassification of loan late charges into interest income.

Financial service revenue, which consists of commissions and fees from fiduciary activities, and securities brokerage and insurance activities, decreased 10.4% to $6.9 million for the quarter ended March 31, 2014, compared to $7.7 million for the quarter ended March 31, 2013. This decrease is mainly due to local market conditions.

Income generated from mortgage banking activities decreased 38.2% to $2.0 million for the quarter ended March 31, 2014 compared to $3.2 million for the quarter ended March 31, 2013. Decrease in mortgage banking activities is mainly due to higher losses in repurchased loans, lower cost or market adjustment made to mortgage loans held for sale during such quarter and a decrease in sales, when compared to same period in 2013.

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Gains from sale of securities were $4.4 million for the quarter ended March 31, 2014, compared to the same quarter in 2013, in which no gain or loss from sale of securities was recorded. Losses from derivative activities were $478 thousand for the quarter ended March 31, 2014, compared to $788 thousand for the same period in 2013. During the quarter ended March 31, 2014, the Company did not have a gain or loss on extinguishment of debt, as compared to the quarter ended March 31, 2013 in which the Company had a gain $1.1 million.

TABLE 3 - NON-INTEREST EXPENSES SUMMARY
	Quarter Ended March 31,
	2014		2013		Variance %
	(Dollars in thousands)
Compensation and employee benefits	$	21,787	$	23,249	-6.3%
Professional and service fees		4,206		6,478	-35.1%
Occupancy and equipment		8,309		9,216	-9.8%
Merger and restructuring charges		-		5,534	-100.0%
Taxes, other than payroll and income taxes		3,735		2,622	42.4%
Electronic banking charges		4,743		3,728	27.2%
Information technology expenses		1,815		2,643	-31.3%
Insurance		2,074		2,678	-22.6%
Foreclosure, repossession and other real estate expenses		6,436		3,382	90.3%
Loan servicing and clearing expenses		2,060		1,475	39.7%
Advertising, business promotion, and strategic initiatives		1,781		1,409	26.4%
Printing, postage, stationery and supplies		554		1,166	-52.5%
Communication		957		864	10.8%
Director and investor relations		251		236	6.4%
Other operating expenses		2,745		2,129	28.9%
Total non-interest expenses	$	61,453	$	66,809	-8.0%
Relevant ratios and data:
Efficiency ratio		50.03%		57.46%
Compensation and benefits to         non-interest expense		35.45%		34.80%
Compensation to average total assets owned		0.27%		0.27%
Average number of employees		1,546		1,565
Average compensation per employee	$	14.1	$	14.9
Average loans per average employee	$	3,239	$	3,251

Non-Interest Expenses

Non-interest expense for the quarter ended March 31, 2014 reached $61.5 million, representing a decrease of 8.0% compared to $66.8 million for the quarter ended March 31, 2013. The decrease is due mainly to the merger and restructuring charges incurred during the quarter ended March 31, 2013, for the BBVAPR Acquisition, compared to no charges for the quarter ended March 31, 2014.

Compensation and employee benefits decreased 6.3% to $21.8 million for the quarter ended March 31, 2014, from $23.2 million for the quarter ended March 31, 2013. The decrease is due mainly to a lower headcount related to employee consolidation.

Professional and service fees decreased 35.1% to $4.2 million for the quarter ended March 31, 2014 as compared to $6.5 million for the quarter ended March 31, 2013. Professional and service fees are primarily composed of legal expenses and consulting and outsourcing expenses. For the quarter ended March 31, 2014 these fees amounted to $1.1 million and $1.1 million, respectively, compared to $1.2 million and $1.5 million, respectively, for the quarter ended March 31, 2013. Decrease in professional and service fees is mainly related to loan servicing fees amounting to $1.8 million during the quarter ended March 31, 2013 for a third party loan servicer that was terminated during the quarter ended June 30, 2013.

Occupancy and equipment expenses decreased 9.8% to $8.3 million for the quarter ended March 31, 2014, as compared to $9.2 million for the quarter ended March 31, 2013. The decrease is mainly related to a lower rent expense due to closed branches and lower depreciation expenses for office building and leasehold improvement.

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Taxes, other than payroll and income taxes, for the quarter ended March 31, 2014 increased to $3.7 million, as compared to $2.6 million for the quarter ended March 31, 2013. The increase primarily reflects a $1.3 million impact for 2014 from the application of the 1.0% tax on gross revenues which was part of the Act. No. 40-2013, known as “Ley de Redistribución y Ajuste de la Carga Contributiva”, signed into law on June 30, 2013.

Electronic banking charges increased 27.2% to $4.7 million for the quarter ended March 31,2014 as compared to $3.7 million for the quarter ended March 31, 2013, mostly due to the increase in expenses related to merchant business and card interchange transactions resulting from the continued growth of our banking business as a result of the BBVAPR Acquisition.

Foreclosure, repossession and other real estate expenses for the quarter ended March 31, 2014 increased 90.3% to $6.4 million, as compared to $3.4 million for the same quarter in 2013, principally due to an increase in foreclosures and decrease in fair value of real estate during the first quarter of 2014 as compared to the same quarter in 2013.

The increase in the Company’s net-interest income resulted in a decrease in the efficiency ratio to 50.03% for the quarter ended March 31, 2014 from 57.46% from the same quarter in 2013. The efficiency ratio measures how much of a company’s revenue is used to pay operating expenses. The Company computes its efficiency ratio by dividing non-interest expenses by the sum of its net interest income and non-interest income, but excluding gains on the sale of investments securities, derivatives gains or losses, credit-related other-than-temporary impairment losses, FDIC shared-loss expense, losses on the early extinguishment of debt, other gains and losses, and other income that may be considered volatile in nature. Management believes that the exclusion of those items permits greater comparability. Amounts presented as part of non-interest income that are excluded from the efficiency ratio computation amounted to losses of $14.1 million for the quarter ended March 31, 2014, compared to losses of $12.6 million for the quarter ended March 31, 2013. Revenue for purposes of the efficiency ratio for the quarter ended March 31, 2014 amounted to $122.8 million, compared to $116.3 million for the same period in 2013.

Provision for Loan and Lease Losses

The provision for non-covered loan and lease losses for the quarter ended March 31, 2014 totaled $10.1 million, an increase of 27.1% from the $7.9 million for the quarter ended March 31, 2013, mostly related to the provision recorded on non-covered loans acquired accounted for under ASC 310-20 amounting to $4.2 million during the quarter ended March 31, 2014 as compared to no provision for these loans for the same period in 2013. Provision for originated loan and lease losses for the quarter ended March 31, 2014 was $5.6 million, a 2.9 % decrease when compared to the quarter ended March 31, 2013, mainly related to decrease in the loan average balance. Based on an analysis of the credit quality and the composition of the Company’s loan portfolio, management determined that the provision for the quarter ended March 31, 2014 was adequate in order to maintain the allowance for loan and lease losses at an adequate level to provide for probable losses based upon an evaluation of known and inherent risks.

During the first quarter of 2014, net credit losses, excluding acquired loans, amounted to $5.2 million, representing an increase of 53.7%, when compared to $3.4 million reported for the same quarter in 2013.

Total charge-offs on non-covered loans, excluding acquired loans, increased 104.4% to $7.1 million in the first quarter of 2014, as compared to $3.5 million for the same quarter in 2013, and total recoveries increased from $99 thousand in the first quarter of 2013, to $1.9 million in the first quarter of 2014. As a result, the recoveries to charge-offs ratio increased from 2.84% in the first quarter of 2013 to 26.94% in the first quarter of 2014. The increase in net credit losses was primarily due to an increase of $3.0 million in the auto portfolio during the first quarter of 2014, compared to the same period in 2013.

The non-covered loans acquired accounted for under ASC 310-20 required a provision for loan and lease losses of $4.2 million for the quarter ended March 31, 2014. No provision was required for the quarter ended March 31, 2013. Non-covered loans acquired accounted for under ASC 310-30 required a provision for loan and lease losses of $195 thousand for the quarter ended March 31, 2014, reflecting the Company’s revision of the expected cash flows in the non-covered acquired loan portfolio considering actual experiences and changes in the Company’s expectations for the remaining term of the loan pools. No provision was required for the quarter ended March 31, 2013, as the portfolio was recently acquired during the fourth quarter of 2012.

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Provision for covered loans and lease losses for the first quarter of 2014 was $1.6 million, reflecting the Company’s revision of the expected cash flows in the covered loan portfolio considering actual experiences and changes in the Company’s expectations for the remaining terms of the loan pools.

Please refer to the “Allowance for Loan and Lease Losses and Non-Performing Assets” section in this MD&A and Table 8 through Table 13 below for more detailed information concerning the allowances for loan and lease losses, net credit losses and credit quality statistics.

Income Taxes

Income tax expense increase to $11.8 million for the quarter ended March 31, 2014 compared to an income tax expense of $7.1 million for the same quarter in 2013. The increase for the first quarter of 2014 was due to the recent amendments to the Puerto Rico tax code that increases the corporate income tax rate to 39% from 30%.

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ANALYSIS OF FINANCIAL CONDITION

Assets Owned

At March 31, 2014, the Company’s total assets amounted to $7.856 billion, a decrease of 3.7% when compared to $8.158 billion at December 31, 2013, and interest-earning assets decreased 3.1% from $6.694 billion at December 31, 2013 to $6.485 billion at March 31, 2014, mostly as a result of a decrease in investment securities.

At March 31, 2014, loans represented 77% of total interest-earning assets while investments represented 23%, compared to 75% and 25%, respectively, at December 31, 2013.

The Company’s loan portfolio is comprised of residential mortgage loans, commercial loans collateralized by mortgages on real estate located in Puerto Rico, other commercial and industrial loans, consumer loans, leases, and auto loans. Auto loans were added as part of the BBVAPR Acquisition. At March 31, 2014, the Company’s loan portfolio slightly decreased by 0.3% to $5.003 billion compared to $5.019 billion at December 31, 2013. At March 31, 2014, the covered loan portfolio decreased $9.1 million, or 2.5%, from December 31, 2013 as the loans continue to pay down. At March 31, 2014, the non-covered loan portfolio decreased $7.7 million, or 0.2%, primarily due to the early pay down of some commercial loans.

The FDIC shared-loss indemnification asset amounted to $166.2 million at March 31, 2014 and $189.2 million as of December 31, 2013, representing a 12.2% reduction. The decrease in the FDIC shared-loss indemnification asset is mainly related to reimbursements of $8.2 million received from the FDIC, and the amortization of $17.6 million during the quarter ended March 31, 2014.

Investments principally consist of U.S. treasury securities, U.S. government and agency bonds, mortgage-backed securities, and Puerto Rico government and agency bonds. At March 31, 2014, the investment portfolio decreased 8.2% to $1.482 billion from $1.615 billion at December 31, 2013. This decrease is mostly due to the reduction of $96.5 million in FNMA and FHLMC certificates and $97.1 million in Puerto Rico government obligations due to redemptions and maturities. In addition, during the quarter ended March 31, 2014, the Company sold $110.8 million of mortgage-backed available for sale securities taking advantage of market opportunities to realize gains and reduce some interest rate sensitivity. During the quarter ended March 31, 2014, the Company also had normal prepayment of mortgage-backed securities of approximately $55 million. The decrease in investments was partially offset by the increase of $70.0 million in US Treasury securities.

At March 31, 2014 and December 31, 2013, the Company’s net deferred tax asset amounted to $127.7 million and $137.6 million, respectively. In assessing the realizability of the deferred tax asset, management considers whether it is more likely than not that some portion or the entire deferred tax asset will not be realized. The ultimate realization of the deferred tax asset is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible.  Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment.  Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax asset are deductible, management believes it is more likely than not that the Company will realize the entire deferred tax asset, net of the existing valuation allowances recorded at March 31, 2014 and December 31, 2013. The amount of the deferred tax asset considered realizable, however, could be reduced in the near term if estimates of future taxable income during the carryforward period are reduced.

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Company’s Financial Assets Managed

The Company’s financial assets managed include those managed by the Company’s trust division, retirement plan administration subsidiary, and its broker-dealer subsidiary. The Company’s trust division offers various types of IRAs and manages 401(k) and Keogh retirement plans and custodian and corporate trust accounts, while the retirement plan administration subsidiary, CPC, manages private retirement plans. At March 31, 2014, total assets managed by the Company’s trust division and CPC amounted to $2.798 billion, compared to $2.797 billion at December 31, 2013. Oriental Financial Services offers a wide array of investment alternatives to its client base, such as tax-advantaged fixed income securities, mutual funds, stocks, bonds and money management wrap-fee programs. At March 31, 2014, total assets gathered by Oriental Financial Services from its customer investment accounts increased to $2.577 billion, compared to $2.493 billion in assets gathered at December 31, 2013. Changes in trust and broker-dealer related assets primarily reflect an increase in portfolio and differences in market values.

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TABLE 4 - ASSETS SUMMARY AND COMPOSITION
	March 31,		December 31,
	2014		2013		Variance %
	(Dollars in thousands)
Investments:
FNMA and FHLMC certificates	$	1,120,795	$	1,217,330	-7.9%
Obligations of US Government -sponsored agencies		9,497		10,649	-10.8%
US Treasury securities		70,000		-	100.0%
CMOs issued by US Government -sponsored agencies		207,520		214,394	-3.2%
GNMA certificates		6,549		7,816	-16.2%
Puerto Rico Government and political subdivisions		17,069		114,190	-85.1%
FHLB stock		24,430		24,450	-0.1%
Other debt securities		24,255		24,047	0.9%
Other investments		1,975		1,933	2.2%
Total investments		1,482,090		1,614,809	-8.2%
Loans:
Loans not covered under shared-loss agreements with the FDIC		4,691,577		4,670,227	0.5%
Allowance for loan and lease losses on non covered loans		(56,183)		(54,298)	-3.5%
Non covered loans receivable, net		4,635,394		4,615,929	0.4%
Mortgage loans held for sale		19,355		46,529	-58.4%
Total loans not covered under shared-loss agreements with the FDIC, net		4,654,749		4,662,458	-0.2%
Loans covered under shared-loss agreements with the FDIC		402,263		409,690	-1.8%
Allowance for loan and lease losses on covered loans		(54,398)		(52,729)	-3.2%
Total loans covered under shared-loss agreements with the FDIC, net		347,865		356,961	-2.5%
Total loans, net		5,002,614		5,019,419	-0.3%
Securities purchased under agreements to resell		-		60,000	-100.0%
Total securities and loans		6,484,704		6,694,228	-3.1%
Other assets:
Cash and due from banks		632,154		696,501	-9.2%
Money market investments		7,652		6,967	9.8%
FDIC shared-loss indemnification asset		166,194		189,240	-12.2%
Foreclosed real estate		96,884		90,024	7.6%
Accrued interest receivable		18,969		18,734	1.3%
Deferred tax asset, net		127,657		137,564	-7.2%
Premises and equipment, net		83,029		82,903	0.2%
Servicing assets		13,970		13,801	1.2%
Derivative assets		15,861		20,502	-22.6%
Goodwill		86,069		86,069	0.0%
Other assets		122,495		121,482	0.8%
Total other assets		1,370,934		1,463,787	-6.3%
Total assets	$	7,855,638	$	8,158,015	-3.7%
Investments portfolio composition:
FNMA and FHLMC certificates		75.6%		75.4%
Obligations of US Government-sponsored agencies		0.6%		0.7%
US Treasury securities		4.7%		0.0%
CMOs issued by US Government-sponsored agencies		14.0%		13.3%
GNMA certificates		0.4%		0.5%
Puerto Rico Government and political subdivisions		1.2%		7.1%
FHLB stock		1.7%		1.5%
Other debt securities and other investments		1.8%		1.5%
		100.0%		100.0%

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TABLE 5 — LOANS RECEIVABLE COMPOSITION
	March 31,		December 31,		Variance
	2014		2013		%
	(Dollars in thousands)
Loans not covered under shared-loss agreements with FDIC:
Originated and other loans and leases held for investment:
Mortgage	$	782,150	$	766,265	2.1%
Commercial		1,170,145		1,127,657	3.8%
Consumer		142,492		127,744	11.5%
Auto and leasing		447,940		379,874	17.9%
Total originated and other loans and leases held for investment		2,542,727		2,401,540	5.9%
Acquired loans:
Accounted for under ASC 310-20
Commercial		71,577		77,681	-7.9%
Consumer		52,049		56,174	-7.3%
Auto		268,865		301,584	-10.8%
		392,491		435,439	-9.9%
Accounted for under ASC 310-30
Mortgage		703,454		717,904	-2.0%
Commercial		655,388		671,544	-2.4%
Consumer		53,310		63,620	-16.2%
Auto		341,889		379,145	-9.8%
		1,754,041		1,832,213	-4.3%
		2,146,532		2,267,652	-5.3%
		4,689,259		4,669,192	0.4%
Deferred loans fees, net		2,318		1,035	124.0%
Loans receivable		4,691,577		4,670,227	0.5%
Allowance for loan and lease losses on non-covered loans		(56,183)		(54,298)	-3.5%
Loans receivable, net		4,635,394		4,615,929	0.4%
Mortgage loans held-for-sale		19,355		46,529	-58.4%
Total loans not covered under shared-loss agreements with FDIC, net		4,654,749		4,662,458	-0.2%
Loans covered under shared-loss agreements with FDIC:
Loans secured by 1-4 family residential properties		124,239		121,748	2.0%
Construction and development secured by 1-4 family residential properties		18,254		17,304	5.5%
Commercial and other construction		253,804		264,249	-4.0%
Consumer		5,769		6,119	-5.7%
Leasing		197		270	-27.0%
Total loans covered under shared-loss agreements with FDIC		402,263		409,690	-1.8%
Allowance for loan and lease losses on covered loans		(54,398)		(52,729)	-3.2%
Total loans covered under shared-loss agreements with FDIC, net		347,865		356,961	-2.5%
Total loans receivable, net	$	5,002,614	$	5,019,419	-0.3%

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As shown in Table 5 above, total loans, net amounted to $5.002 billion at March 31, 2014 and $5.019 at December 31, 2013.

The Company’s originated and other loans held-for-investment portfolio composition and trends were as follows:

·Mortgage loan portfolio amounted to $782.2 million (30.8% of the gross originated loan portfolio) compared to $766.3 million (31.9% of the gross originated loan portfolio) at December 31, 2013. Mortgage loan production totaled $50.8 million for the quarter ended March 31, 2014, which represents a decrease of 34.1% from $77.1 million for the same period in 2013. Mortgage loans included delinquent loans in the GNMA buy-back option program amounting to $35.3 million and $34.9 million for the periods ended March 31, 2014 and December 31, 2013, respectively. Servicers of loans underlying GNMA mortgage-backed securities must report as their own assets the defaulted loans that they have the option (but not the obligation) to repurchase, even when they elect not to exercise that option.

·Commercial loan portfolio amounted to $1.170 billion (46.0% of the gross originated loan portfolio) compared to $1.128 billion (47.0% of the gross originated loan portfolio) at December 31, 2013. Commercial loan production decreased 46.3% to $39.8 million for the first quarter of 2014 from $74.1 million for the first quarter of 2013.

·Consumer loan portfolio amounted to $142.5 million (5.6% of the gross originated loan portfolio) compared to $127.7 million (5.3% of the gross originated loan portfolio) at December 31, 2013. Consumer loan production increased 22.9% to $27.8 million for the quarter ended March 31, 2014 from $22.6 million for the same period in 2013.

·Auto loans and leasing portfolio amounted to $447.9 million (17.6% of the gross originated loan portfolio) compared to $379.9 million (15.8% of the gross originated loan portfolio) at December 31, 2013. Auto production was $93.6 million for the quarter ended March 31, 2014, compared to $101.0 million for the same period in 2013.

At March 31, 2014 and December 31, 2013 the Company's non-covered acquired loan portfolio composition was as follows:
	March 31, 2014			December 31, 2013
Portfolio Type		Carrying Amounts	% of Gross Non-Covered Acquired Portfolio		Carrying Amounts	% of Gross Non-Covered Acquired Portfolio
	(Dollars in thousands)
Mortgage	$	703,454	32.8%	$	717,904	31.7%
Commercial		726,965	33.9%		749,225	33.0%
Consumer		105,359	4.9%		119,794	5.3%
Auto		610,754	28.5%		680,729	30.0%
	$	2,146,532	100.00%	$	2,267,652	100.00%

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TABLE 6 — HIGHER RISK RESIDENTIAL MORTGAGE LOANS
	March 31, 2014
	Higher-Risk Residential Mortgage Loans*
											High Loan-to-Value Ratio Mortgages
	Junior Lien Mortgages					Interest Only Loans					LTV 90% and over
	Carrying					Carrying					Carrying
	Value		Allowance		Coverage	Value		Allowance		Coverage	Value		Allowance		Coverage
	(In thousands)
Delinquency:
0 - 89 days	$	12,996	$	305	2.35%	$	23,737	$	1,135	4.78%	$	84,654	$	2,010	2.37%
90 - 119 days		72		2	2.78%		-		-	0.00%		1,340		13	0.97%
120 - 179 days		-		-	0.00%		510		76	14.90%		543		29	5.34%
180 - 364 days		153		10	6.54%		148		22	14.86%		783		50	6.39%
365+ days		386		48	12.44%		423		226	53.43%		1,169		201	17.19%
Total	$	13,607	$	365	2.68%	$	24,818	$	1,459	5.88%	$	88,489	$	2,303	2.60%
Percentage of total loans excluding     acquired loans accounted for under ASC 310-30		0.46%					0.84%					2.99%
Refinanced or Modified Loans:
Amount	$	2,297	$	206	8.97%	$	-	$	-	0.00%	$	12,888	$	1,043	8.09%
Percentage of Higher-Risk Loan     Category		16.88%					0.00%					14.56%
Loan-to-Value Ratio:
Under 70%	$	9,789	$	265	2.71%	$	2,460	$	249	10.12%	$	-	$	-	-
70% - 79%		2,736		74	2.70%		3,856		199	5.16%		-		-	-
80% - 89%		883		25	2.83%		7,279		400	5.50%		-		-	-
90% and over		199		1	0.50%		11,223		611	5.44%		88,489		2,303	2.60%
	$	13,607	$	365	2.68%	$	24,818	$	1,459	5.88%	$	88,489	$	2,303	2.60%
* Loans may be included in more than one higher-risk loan category and excludes acquired residential mortgage loans.

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The following table includes the Company's lending and investment exposure to the Puerto Rico government, including its agencies, instrumentalities, municipalities and public corporations:
TABLE 7 - PUERTO RICO GOVERNMENT RELATED LOANS AND SECURITIES
March 31, 2014
						Maturity
Loans and Securities:		Carrying Value		Less than 1 Year		1 to 3 Years		More than 3 Years	Comments
	(In thousands)
Central government	$	146,728	$	117,982	$	-	$	28,746		Repayment sources include all available revenues of the Commonwealth
Public corporations		350,354		191,183		75,000		84,171		$84.2 million which mature in more than 3 years, with pledged securities (rating > A)
Municipalities		221,741		-		507		221,234		Repayment from property taxes
Investment securities		42,368		20,000		-		22,368
Total	$	761,191	$	329,165	$	75,507	$	356,519

Some highlights follow on the data included above:

·Loans to Puerto Rico central government and public corporations are collateralized or have specific repayment sources.

·Loans to municipalities are backed by their unlimited taxing power or real and personal property taxes.

·43% of loans and securities balances mature in 12-months or less.

·Deposits from municipalities, central government and other government entities totaled $370.7 million at March 31, 2014. However, this amount may decline as a result of recently enacted legislation to improve the liquidity of the Government Development Bank for Puerto Rico (“GDB”) by requiring the Commonwealth’s agencies, instrumentalities and public corporations to maintain certain deposits at GDB.

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Allowance for Loan and Lease Losses and Non-Performing Assets

The Company maintains an allowance for loan and lease losses at a level that management considers adequate to provide for probable losses based upon an evaluation of known and inherent risks. The Company’s allowance for loan and lease losses policy provides for a detailed quarterly analysis of probable losses. Tables 8 through 12 set forth an analysis of activity in the allowance for loan and lease losses and present selected loan loss statistics. In addition, Table 5 sets forth the composition of the loan portfolio. As part of the Company’s continuous enhancement to the allowance for loan and lease losses methodology, during the quarter ended March 31, 2014, an assessment of the look-back period and historical loss factor was performed for auto and leasing and consumer loan portfolios based on the trends observed and their relation with the economic cycle as of the period ended March 31, 2014. As a result, the period was changed to 24 months from the previously determined 12 months. This change in the allowance for loan and lease losses’ look back period for the consumer and auto and leasing portfolios is considered a change in accounting estimate as per ASC 250-10 provisions, where adjustments should be made prospectively.

Non-covered Loans

At March 31, 2014, the Company’s allowance for non-covered loan and lease losses amounted to $56.2 million, $49.5 million of such allowance corresponded to originated and other loans held for investment, or 1.95% of total non-covered originated and other loans held for investment at March 31, 2014, compared to $49.1 million or 2.04% of total non-covered originated and other loans held for investment at December 31, 2013. The allowance for residential mortgage loans and commercial loans decreased by 2.1% ($426 thousand), and 6.1% (or $903 thousand), respectively, when compared with the balances recorded at December 31, 2013. The allowance for consumer loans and auto and leases increased by 18.8% (or $1.1 million) and 11.0% (or $865 thousand), respectively, when compared with balances recorded at December 31, 2013. The unallocated allowance at March 31, 2014 decreased by 63.7%, or $239 thousand, when compared with the balance recorded at December 31, 2013.

Please refer to the “Provision for Loan and Lease Losses” section in this MD&A for a more detailed analysis of provisions for loan and lease losses.

Allowance for loan and lease losses recorded for acquired loans accounted for under the provisions of ASC 310-20 at March 31, 2014 was $3.6 million compared to $2.4 million at December 31, 2013, a 53.7% increase. The allowance for commercial loans decreased by 6.4% ($59 thousand), when compared with the balance recorded at December 31, 2013. The allowance for consumer and auto loans increased by 100% (or $504 thousand) and 57.4% (or $819 thousand), respectively, when compared with balances recorded at December 31, 2013.

Allowance for loan and lease losses recorded for acquired loans accounted for under ASC-310-30 at March 31, 2014 was $3.1 million as compared to $2.9 million at December 31, 2013.

The Company’s non-performing assets include non-performing loans and foreclosed real estate (see Tables 11 and 12). At March 31, 2014 and December 31, 2013, the Company had $88.2 million and $86.2 million, respectively, of non-accrual loans, including acquired loans accounted under ASC 310-20 (loans with revolving feature and/or acquired at a premium). Covered loans and loans acquired from BBVAPR with credit deterioration are considered to be performing due to the application of the accretion method under ASC 310-30. At March 31, 2014 and December 31 2013, loans whose terms have been extended and which are classified as troubled-debt restructuring that are not included in non-performing assets amounted to $70.8 million and $66.5 million, respectively.

At March 31, 2014, the Company’s non-performing assets increased by 4.6% to $162.5 million (2.84% of total assets, excluding covered assets and acquired loans with deteriorated credit quality) from $155.3 million (2.61% of total assets, excluding covered assets and acquired loans with deteriorated credit quality) at December 31, 2013. The Company does not expect non-performing loans to result in significantly higher losses as most are well-collateralized with adequate loan-to-value ratios. At March 31, 2014, the allowance for non-covered originated loans and lease losses to non-performing loans coverage ratio was 59.90% (61.52% at December 31, 2013).

The Company follows a conservative residential mortgage lending policy, with more than 90% of its residential mortgage portfolio consisting of fixed-rate, fully amortizing, fully documented loans that do not have the level of risk associated with subprime loans offered by certain major U.S. mortgage loan originators. Furthermore, the Company has never been active in negative amortization loans or adjustable rate mortgage loans, including those with teaser rates.

The following items comprise non-performing assets:

92

1.Originated and other loans held for investment:

Mortgage loans — are placed on non-accrual status when they become 90 days or more past due and are written-down, if necessary, based on the specific evaluation of the collateral underlying the loan, except for FHA and VA insured mortgage loans which are placed in non-accrual when they become 18 months or more past due. At March 31, 2014, the Company’s originated non-performing mortgage loans totaled $51.7 million (58.7% of the Company’s non-performing loans), a 1.3% increase from $51.1 million (59.4% of the Company’s non-performing loans) at December 31, 2013. Non-performing loans in this category are primarily residential mortgage loans.

Commercial loans — are placed on non-accrual status when they become 90 days or more past due and are written-down, if necessary, based on the specific evaluation of the underlying collateral, if any. At March 31, 2014, the Company’s originated non-performing commercial loans amounted to $23.8 million (27.0% of the Company’s non-performing loans), a 4.2% increase when compared to non-performing commercial loans of $22.8 million at December 31, 2013 (26.5% of the Company’s non-performing loans). Most of this portfolio is collateralized by commercial real estate properties.

Consumer loans — are placed on non-accrual status when they become 90 days past due and written-off when payments are delinquent 120 days in personal loans and 180 days in credit cards and personal lines of credit. At March 31, 2014, the Company’s originated non-performing consumer loans amounted to $1.1 million (1.2% of the Company’s total non-performing loans), a 34.7% increase from $805 thousand at December 31, 2013 (0.9% of the Company’s total non-performing loans).

Auto and leases — are placed on non-accrual status when they become 90 days past due and partially written-off to collateral value when payments are delinquent 120 days, and fully written-off when payments are delinquent 180 days. At March 31, 2014, the Company’s originated non-performing auto and leases amounted to $6.0 million (6.9% of the Company’s total non-performing loans), an increase of 18.8% from $5.1 million at December 31, 2013 (5.9% of the Company’s total non-performing loans).

·Acquired loans accounted for under ASC 310-20 (loans with revolving features and/or acquired at premium):

Commercial revolving lines of credit and credit cards - are placed on non-accrual status when they become 90 days or more past due and are written-down, if necessary, based on the specific evaluation of the underlying collateral, if any. At March 31, 2014, the Company’s acquired non-performing commercial lines of credit accounted for under ASC 310-20 amounted to $1.9 million (2.1% of the Company’s non-performing loans), a 26.8% decrease when compared to non-performing commercial lines of credit accounted for under ASC 310-20 of $2.5 million at December 31, 2013 (3.0% of the Company’s non-performing loans).

Consumer revolving lines of credit and credit cards — are placed on non-accrual status when they become 90 days past due and written-off when payments are delinquent 180 days. At March 31, 2014, the Company’s acquired non-performing consumer lines of credit and credit cards accounted for under ASC 310-20 totaled $2.1 million (2.4% of the Company’s non-performing loans), an 3.8% decrease when compared to non-performing consumer lines of credit and credit cards accounted for under ASC 310-20 of $2.2 million at December 31, 2013 (2.6% of the Company’s non-performing loans).

Auto loans acquired at premium - are placed on non-accrual status when they become 90 days past due and partially written-off to collateral value when payments are delinquent 120 days, and fully written-off when payments are delinquent 180 days. At March 31, 2014, the Company’s acquired non-performing auto loans accounted for under ASC 310-20 totaled $1.5 million (1.7% of the Company’s non-performing loans), a 5.8% decrease when compared to non-performing auto loans accounted for under ASC 310-20 of $1.6 million at December 31, 2013 (1.9% of the Company’s non-performing loans).

·Acquired loans accounted for under ASC 310-30 are considered to be performing due to the application of the accretion method, in which these loans will accrete interest income over the remaining life of the loans using estimated cash flow analyses. Credit related decreases in expected cash flows, compared to those previously forecasted, are recognized by recording a provision for credit losses on non-covered loans when it is probable that all cash flows expected at acquisition will not be collected.

·Foreclosed real estate is initially recorded at the lower of the related loan balance or fair value less cost to sell as of the date of foreclosure. Any excess of the loan balance over the fair value of the property is charged against the allowance for loan and lease losses. Subsequently, any excess of the carrying value over the estimated fair value less disposition cost is charged to operations.

93

Net losses on foreclosed real estate and other repossessed assets for the quarter ended March 31, 2014 amounted to $3.5 million, compared to $1.9 million for the same period in 2013.

The Company has two mortgage loan modification programs. These are the Loss Mitigation Program and the Non-traditional Mortgage Loan Program. Both programs are intended to help responsible homeowners to remain in their homes and avoid foreclosure, while also reducing the Company’s losses on non-performing mortgage loans.

The Loss Mitigation Program helps mortgage borrowers who are or will become financially unable to meet the current or scheduled mortgage payments. Loans that qualify under this program are those guaranteed by FHA, VA, RHS, “Banco de la Vivienda de Puerto Rico,” conventional loans guaranteed by Mortgage Guaranty Insurance Corporation (MGIC), conventional loans sold to the FNMA and FHLMC, and conventional loans retained by the Company. The program offers diversified alternatives such as regular or reduced payment plans, payment moratorium, mortgage loan modification, partial claims (only FHA), short sale, and payment in lieu of foreclosure.

The Non-traditional Mortgage Loan Program is for non-traditional mortgages, including balloon payment, interest only / interest first, variable interest rate, adjustable interest rate and other qualified loans. Non-traditional mortgage loan portfolios are segregated into the following categories: performing loans that meet secondary market requirement and are refinanced by the credit underwriting guidelines of FHA/VA/FNMA/ FMAC, and performing loans not meeting secondary market guidelines, processed by the Company’s current credit and underwriting guidelines. The Company achieved an affordable and sustainable monthly payment by taking specific, sequential, and necessary steps such as reducing the interest rate, extending the loan term, capitalizing arrearages, deferring the payment of principal or, if the borrower qualifies, refinancing the loan.

There may not be a foreclosure sale scheduled within 60 days prior to a loan modification under any such programs. This requirement does not apply to loans where the foreclosure process has been stopped by the Company. In order to apply for any of the loan modification programs, the borrower may not be in active bankruptcy or have been discharged from Chapter 7 bankruptcy since the loan was originated. Loans in these programs are to be evaluated by management for troubled-debt restructuring classification if the Company grants a concession for legal or economic reasons due to the debtor’s financial difficulties.

Covered Loans

The allowance for loan and lease losses on covered loans acquired in the FDIC-assisted acquisition of Eurobank is accounted under the provisions of ASC 310-30. Under this accounting guidance, the allowance for loan and lease losses on covered loans is evaluated at each financial reporting period, based on forecasted cash flows. Credit related decreases in expected cash flows, compared to those previously forecasted, are recognized by recording a provision for credit losses on covered loans when it is probable that all cash flows expected at acquisition will not be collected. The portion of the loss on covered loans reimbursable from the FDIC is recorded as an offset to the provision for credit losses and increases the FDIC shared-loss indemnification asset.

For the quarter ended March 31, 2014, the net provision for covered loans amounted to $1.6 million, reflecting the Company’s revision of the expected cash flows in the covered loan portfolio considering actual experiences and changes in the Company’s expectations for the remaining terms of the loan pools. The allowance for covered loans increased from $52.7 million at December 31, 2013 to $54.4 million at March 31, 2014.

94

TABLE 8 — ALLOWANCE FOR LOAN AND LEASE LOSSES SUMMARY
	Quarter Ended March 31,				Variance
	2014		2013		%
Non-covered loans
Originated and other loans:
Balance at beginning of period	$	49,081	$	39,921	22.9%
Provision for non-covered         loan and lease losses		5,625		5,795	-2.9%
Charge-offs		(7,116)		(3,482)	104.4%
Recoveries		1,917		100	1817.0%
		49,507		42,334	16.9%
Acquired loans accounted for under ASC 310-20:
Balance at beginning of period	$	2,354	$	-	0.0%
Provision for non-covered         loan and lease losses		4,242		2,120	100.0%
Charge-offs		(3,528)		(3,171)	100.0%
Recoveries		550		1,437	100.0%
		3,618		386	100.0%
Acquired loans accounted for under ASC 310-30:
Balance at beginning of period	$	2,863	$	-	0.0%
Provision for non-covered         loan and lease losses		195		-	100.0%
		3,058		-	100.0%
Total non-covered loans balance   at end of period	$	56,183	$	42,720	31.5%
Allowance for loans and lease       losses on originated and other       loans to:
Total originated loans		1.95%		2.91%	-33.1%
Non-performing originated loans		59.90%		32.45%	84.6%
Allowance for loans and lease       losses on acquired loans accounted        for under ASC 310-20 to:
Total acquired loans accounted         for under ASC 310-20		0.92%		0.05	100.0%
Non-performing acquired loans         accounted for under ASC 310-20		65.65%		21.94	100.0%
Covered loans
Balance at beginning of period	$	52,729	$	54,124	-2.6%
Provision for covered         loan and lease losses, net		1,629		672	142.4%
FDIC shared-loss portion on        (provision for) recapture of loan        and lease losses		40		(1,822)	-102.2%
Balance at end of period	$	54,398	$	52,974	2.7%

95

TABLE 9 — ALLOWANCE FOR NON-COVERED LOAN AND LEASE LOSSES BREAKDOWN
		March 31, 2014	December 31, 2013		Variance %
	(Dollars in thousands)
Originated and other loans held for investment
Allowance balance:
Mortgage	$	19,511	$	19,937	-2.1%
Commercial		13,994		14,897	-6.1%
Consumer		7,135		6,006	18.8%
Auto and leasing		8,731		7,866	11.0%
Unallocated allowance		136		375	-63.7%
Total allowance balance	$	49,507	$	49,081	0.9%
Allowance composition:
Mortgage		39.41%		40.62%	-3.0%
Commercial		28.27%		30.35%	-6.9%
Consumer		14.41%		12.24%	17.7%
Auto and leasing		17.64%		16.03%	10.0%
Unallocated allowance		0.27%		0.76%	-64.5%
		100.00%		100.00%
Allowance coverage ratio at end of period applicable to:
Mortgage		2.49%		2.60%	-4.1%
Commercial		1.20%		1.32%	-9.5%
Consumer		5.01%		4.70%	6.5%
Auto and leasing		1.95%		2.07%	-5.9%
Unallocated allowance to total originated loans		0.01%		0.02%	-65.7%
Total allowance to total originated loans		1.95%		2.04%	-4.7%
Allowance coverage ratio to non-performing loans:
Mortgage		37.72%		39.05%	-3.4%
Commercial		58.82%		65.25%	-9.9%
Consumer		658.21%		746.09%	-11.8%
Auto and leasing		144.39%		154.57%	-6.6%
Total		59.90%		61.52%	-2.6%
Acquired loans accounted for under ASC 310-20
Allowance balance:
Commercial	$	867	$	926	-6.4%
Consumer		504		-	100.0%
Auto		2,247		1,428	57.4%
Total allowance balance	$	3,618	$	2,354	53.7%
Allowance composition:
Commercial		23.96%		39.34%	-39.1%
Consumer		13.93%		0.00%	100.0%
Auto		62.11%		60.66%	2.4%
		100.00%		100.00%
Allowance coverage ratio at end of period applicable to:
Commercial		1.21%		1.19%	1.6%
Consumer		0.97%		0.00%	100.0%
Auto		0.84%		0.47%	76.5%
Total allowance to total acquired loans		0.92%		0.54%	70.5%
Allowance coverage ratio to non-performing loans:
Commercial		46.56%		36.41%	27.9%
Consumer		23.62%		0.00%	100.0%
Auto		148.32%		88.81%	67.0%
Total		65.65%		36.95%	77.7%

96

TABLE 9 — ALLOWANCE FOR NON-COVERED LOAN AND LEASE LOSSES BREAKDOWN (CONTINUED)
		March 31, 2014	December 31, 2013		Variance %
	(Dollars in thousands)
Acquired loans accounted for under ASC 310-30
Allowance balance:
Commercial	$	2,653	$	1,713	54.9%
Consumer		405		418	100.0%
Auto		-		732	-100.0%
Total allowance balance	$	3,058	$	2,863	6.8%
Allowance composition:
Commercial		86.76%		59.83%	45.0%
Consumer		13.24%		14.60%	100.0%
Auto		0.00%		25.57%	-100.0%
		100.00%		100.00%

97

TABLE 10 — NET CREDIT LOSSES STATISTICS ON LOAN AND LEASES, EXCLUDING LOANS ACCOUNTED FOR UNDER ASC 310-30
	Quarter Ended March 31,				Variance
	2014		2013		%
	(Dollar in thousands)
Originated and other loans and leases:
Mortgage
Charge-offs	$	(1,214)	$	(2,588)	-53.1%
Recoveries		148		-	100.0%
Total		(1,066)		(2,588)	-58.8%
Commercial
Charge-offs		(419)		(557)	-24.8%
Recoveries		98		28	250.0%
Total		(321)		(529)	-39.3%
Consumer
Charge-offs		(838)		(246)	240.7%
Recoveries		147		65	126.2%
Total		(691)		(181)	281.8%
Auto
Charge-offs		(4,645)		(91)	5004.4%
Recoveries		1,524		6	25300.0%
Total		(3,121)		(85)	3572%
Net credit losses
Total charge-offs		(7,116)		(3,482)	104.4%
Total recoveries		1,917		99	1836.4%
Total	$	(5,199)	$	(3,383)	53.7%
Net credit losses to average     loans outstanding:
Mortgage		0.57%		1.40%	-59.3%
Commercial		0.11%		0.57%	-80.7%
Consumer		2.16%		1.23%	75.6%
Auto		2.99%		0.34%	779.4%
Total		0.86%		1.06%	-18.9%
Recoveries to charge-offs		26.94%		2.84%	847.5%
Average originated loans:
Mortgage	$	753,248	$	740,072	1.8%
Commercial		1,121,953		372,941	200.8%
Consumer		128,239		58,908	117.7%
Auto		418,074		99,048	322.1%
Total	$	2,421,514	$	1,270,969	90.5%

98

TABLE 10 — NET CREDIT LOSSES STATISTICS ON LOAN AND LEASES, EXCLUDING LOANS ACCOUNTED FOR UNDER ASC 310-30 (CONTINUED)
	Quarter  Ended March 31,					Variance
	2014		2013			%
	(Dollars in thousands)
Acquired loans accounted for under ASC 310-20:
Commercial
Charge-offs	$	(174)	$	-	$	100.0%
Total		(174)		-		100.0%
Consumer
Charge-offs		(2,058)		(1,456)		41.3%
Recoveries		100		207		-51.7%
Total		(1,958)		(1,249)		56.8%
Auto
Charge-offs		(1,296)		(1,715)		-24.4%
Recoveries		450		1,230		-63.4%
Total		(846)		(485)		74.4%
Net credit losses
Total charge-offs		(3,528)		(3,171)		11.3%
Total recoveries		550		1,437		-61.7%
Total	$	(2,978)	$	(1,734)		71.7%
Net credit losses to average     loans outstanding:
Commercial		0.95%		0.00%		100.0%
Consumer		11.20%		7.01%		59.7%
Auto		1.20%		0.45%		167.1%
Total		2.80%		0.80%		252.1%
Recoveries to charge-offs		15.59%		0.00%		100.0%
Average loans accounted for under ASC 310-20:
Commercial	$	73,148	$	368,278	$	-80.1%
Consumer		69,916		71,245		-1.9%
Auto		281,703		431,348		-34.7%
Total	$	424,767	$	870,871	$	-51.2%

99

TABLE 11 — NON-PERFORMING ASSETS
	March 31,		December 31,		Variance
	2014		2013		(%)
	(Dollars in thousands)
Non-performing assets:
Non-accruing loans
Troubled-Debt Restructuring loans	$	25,748	$	26,847	-4.1%
Other loans		59,902		56,430	6.2%
Accruing loans
Troubled-Debt Restructuring loans		1,948		1,898	100.0%
Other loans		564		977	100.0%
Total non-performing loans	$	88,162	$	86,152	2.3%
Foreclosed real estate not covered under the         shared-loss agreements with the FDIC		59,099		56,815	4.0%
Other repossessed assets		13,677		12,314	11.1%
Mortgage loans held for sale		1,554		-	100.0%
	$	162,492	$	155,281	4.6%
Non-performing assets to total assets, excluding covered assets and acquired loans with deteriorated credit quality (including those by analogy)		2.84%		2.61%	8.6%
Non-performing assets to total capital		18.13%		17.55%	3.3%

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Interest that would have been recorded in the period if the     loans had not been classified as non-accruing loans	$	655	$	1,524

100

TABLE 12 — NON-PERFORMING LOANS
	March 31,		December 31,		Variance
	2014		2013		%
	(Dollars in thousands)
Non-performing loans:
Originated and other loans held for investment
Mortgage	$	51,728	$	51,058	1.3%
Commercial		23,792		22,830	4.2%
Consumer		1,084		805	34.7%
Auto and leasing		6,047		5,089	18.8%
		82,651		79,782	3.6%
Acquired loans accounted for under ASC 310-20 (Loans with         revolving feature and/or acquired at a premium)
Commercial		1,862		2,543	-26.8%
Consumer		2,134		2,219	-3.8%
Auto		1,515		1,608	-5.8%
		5,511		6,370	-13.5%
Total	$	88,162	$	86,152	2.3%
Non-performing loans composition percentages:
Originated loans
Mortgage		58.7%		59.4%
Commercial		27.0%		26.5%
Consumer		1.2%		0.9%
Auto and leasing		6.9%		5.9%
Acquired loans accounted for under ASC 310-20 (Loans with         revolving feature and/or acquired at a premium)
Commercial		2.1%		3.0%
Consumer		2.4%		2.6%
Auto		1.7%		1.9%
Total		100.0%		100.0%
Non-performing loans to:
Total loans, excluding covered loans and loans accounted for         under ASC 310-30 (including those by analogy)		3.00%		3.04%	-1.3%
Total assets, excluding covered assets and loans accounted for         under ASC 310-30 (including those by analogy)		1.54%		1.45%	6.2%
Total capital		9.83%		9.74%	1.0%
Non-performing loans with partial charge-offs to:
Total loans, excluding covered loans and loans accounted for         under ASC 310-30 (including those by analogy)		0.89%		0.83%	7.2%
Non-performing loans		29.77%		27.35%	8.8%
Other non-performing loans ratios:
Charge-off rate on non-performing loans to non-performing loans         on which charge-offs have been taken		48.65%		56.05%	-13.2%
Allowance for loan and lease losses to non-performing         loans on which no charge-offs have been taken		85.80%		82.18%	4.4%

101

TABLE 13 - LIABILITIES SUMMARY AND COMPOSITION
		March 31,		December 31,
	2014		2013		Variance %
	(Dollars in thousands)
Deposits:
Non-interest bearing deposits	$	755,909	$	550,303	37.4%
NOW accounts		1,432,511		1,587,670	-9.8%
Savings and money market accounts		1,267,289		1,194,566	6.1%
Certificates of deposit		1,843,578		2,048,040	-10.0%
Total deposits		5,299,287		5,380,579	-1.5%
Accrued interest payable		1,705		2,686	-36.5%
Total deposits and accrued interest payable		5,300,992		5,383,265	-1.5%
Borrowings:
Securities sold under agreements to repurchase		1,012,240		1,267,618	-20.1%
Advances from FHLB		335,689		336,143	-0.1%
Federal funds purchased		23,712		-	100.0%
Other term notes		3,708		3,663	1.2%
Subordinated capital notes		100,404		100,010	0.4%
Total borrowings		1,475,753		1,707,434	-13.6%
Total deposits and borrowings		6,776,745		7,090,699	-4.4%
Derivative liabilities		13,830		14,937	-7.4%
Acceptances outstanding		28,535		23,042	23.8%
Other liabilities		140,037		144,424	-3.0%
Total liabilities	$	6,959,147	$	7,273,102	-4.3%
Deposits portfolio composition percentages:
Non-interest bearing deposits		14.3%		10.2%
NOW accounts		27.0%		29.5%
Savings and money market accounts		23.9%		22.2%
Certificates of deposit		34.8%		38.1%
		100.0%		100.0%
Borrowings portfolio composition percentages:
Securities sold under agreements to repurchase		68.6%		74.2%
Advances from FHLB		22.7%		19.7%
Federal funds purchased		1.6%		0.0%
Other term notes		0.3%		0.2%
Subordinated capital notes		6.8%		5.9%
		100.0%		100.0%
Securities sold under agreements to repurchase (excluding accrued interest)
Amount outstanding at period-end	$	1,010,000	$	1,265,000
Daily average outstanding balance	$	1,156,747	$	1,353,011
Maximum outstanding balance at any month-end	$	1,149,167	$	1,552,269

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Liabilities and Funding Sources

As shown in Table 13 above, at March 31, 2014, the Company’s total liabilities were $6.959 billion, 4.3% less than the $7.273 billion reported at December 31, 2013. Deposits and borrowings, the Company’s funding sources, amounted to $6.777 billion at March 31, 2014 versus $7.091 billion at December 31, 2013, a 4.4% decrease.

At March 31, 2014, deposits represented 78% and borrowings represented 22% of interest-bearing liabilities, compared to 76% and 24%, respectively, at December 31, 2013. At March 31, 2014, deposits, the largest category of the Company’s interest-bearing liabilities, were $5.301 billion, down 1.5% from $5.383 billion at December 31, 2013. Non-maturing deposit balances increased 3.7%, to $3.456 billion, while time deposits, higher-priced deposits, declined 10.0% as part of efforts to reduce the cost of deposits, which averaged 0.68% as of March 31, 2014 compared to 0.72% at December 31, 2013.

Borrowings consist mainly of funding sources through the use of repurchase agreements, FHLB-NY advances, subordinated capital notes, and short-term borrowings. At March 31, 2014, borrowings amounted to $1.476 billion, 13.6% lower than the $1.707 billion reported at December 31, 2013. Repurchase agreements as of March 31, 2014 decreased $255.4 million to $1.012 billion from $1.268 billion at December 31, 2013, as the Company used available cash to pay off repurchase agreements at maturity.

As a member of the FHLB-NY, the Bank can obtain advances from the FHLB-NY, secured by the FHLB-NY stock owned by the Bank, as well as by certain of the Bank’s mortgage loans and investment securities. Advances from FHLB-NY amounted to $335.7 million and $336.1 million as of March 31, 2014 and December 31, 2013, respectively. These advances mature from April 2014 through July 2020.

Stockholders’ Equity

At March 31, 2014, the Company’s total stockholders’ equity was $896.5 million, a 1.3% increase when compared to $884.9 million at December 31, 2013. Increase in stockholders’ equity was mainly driven by the income for the quarter, partially offset by an increase in treasury stock. During the quarter ended March 31, 2014, the Company repurchased 707,400 of its outstanding shares of common stock.

At March 31, 2014, tangible common equity to total assets increased to 8.06% from 7.61%. Tier 1 Leverage Capital Ratio increased to 9.51% from 9.11%, Tier 1 Risk-Based Capital Ratio increased to 14.76% from 14.35%, and Total Risk-Based Capital Ratio increased to 16.56% from 16.14% on December 31, 2013.

Taking into consideration the strong capital position, in the fourth quarter of the fiscal year 2013, the Company increased the cash dividend per common share to $0.08, as compared to $0.06 in the first quarter of 2013.

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The following are the consolidated capital ratios of the Company at March 31, 2014 and December 31, 2013

TABLE 14 — CAPITAL, DIVIDENDS AND STOCK DATA
	March 31,		December 31,		Variance
	2014		2013		%
	(Dollars in thousands, except per share data)
Capital data:
Stockholders’ equity	$	896,491	$	884,913	1.3%
Regulatory Capital Ratios data:
Leverage capital ratio		9.51%		9.11%	4.4%
Minimum leverage capital ratio required		4.00%		4.00%
Actual tier 1 capital	$	745,619	$	736,930	1.2%
Minimum tier 1 capital required	$	313,594	$	323,476	-3.1%
Excess over regulatory requirement	$	432,024	$	413,455	4.5%
Tier 1 risk-based capital ratio		14.76%		14.35%	2.9%
Minimum tier 1 risk-based capital ratio required		4.00%		4.00%
Actual tier 1 risk-based capital	$	745,619	$	736,930	1.2%
Minimum tier 1 risk-based capital required	$	202,027	$	205,382	-1.6%
Excess over regulatory requirement	$	543,592	$	531,548	2.3%
Risk-weighted assets	$	5,050,672	$	5,134,538	-1.6%
Total risk-based capital ratio		16.56%		16.14%	2.6%
Minimum total risk-based capital ratio required		8.00%		8.00%
Actual total risk-based capital	$	836,168	$	828,476	0.9%
Minimum total risk-based capital required	$	404,054	$	410,763	-1.6%
Excess over regulatory requirement	$	432,114	$	417,713	3.4%
Risk-weighted assets	$	5,050,672	$	5,134,538	-1.6%
Tangible common equity to total assets		8.06%		7.61%	5.9%
Tangible common equity to risk-weighted assets		12.54%		12.10%	3.6%
Total equity to total assets		11.41%		10.85%	5.2%
Total equity to risk-weighted assets		17.75%		17.23%	3.0%
Tier 1 common equity to risk-weighted assets		10.79%		10.44%	3.4%
Tier 1 common equity capital	$	544,749	$	536,062	1.6%
Stock data:
Outstanding common shares		45,003,924		45,676,922	-1.5%
Book value per common share	$	16.23	$	15.74	3.1%
Tangible book value per common share	$	14.07	$	13.60	3.5%
Market price at end of period	$	17.19	$	17.34	-0.9%
Market capitalization at end of period	$	773,617	$	792,038	-2.3%

	Quarter ended March 31,					Variance
		2014		2013		%
	(Dollars in thousands, except per share data)
Common dividend data:
Cash dividends declared		$	3,657	$	2,737	33.6%
Cash dividends declared per share		$	0.08	$	0.06	33.3%
Payout ratio			17.78%		16.22%	9.6%
Dividend yield			1.86%		1.55%	20.1%

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The following table presents a reconciliation of the Company’s total stockholders’ equity to tangible common equity and total assets to tangible assets at March 31, 2014 and December 31, 2013:

	March 31,		December 31,
	2014		2013
		(In thousands, except share or per share information)
Total stockholders' equity	$	896,491	$	884,913
Preferred stock		(176,000)		(176,000)
Preferred stock issuance costs		10,130		10,130
Goodwill		(86,069)		(86,069)
Core deposit intangible		(7,468)		(7,804)
Customer relationship intangible		(3,902)		(4,108)
Total tangible common equity	$	633,182	$	621,062
Total assets		7,855,638		8,158,015
Goodwill		(86,069)		(86,069)
Core deposit intangible		(7,469)		(7,804)
Customer relationship intangible		(3,902)		(4,108)
Total tangible assets	$	7,758,198	$	8,060,034
Tangible common equity to tangible assets		8.16%		7.71%
Common shares outstanding at end of period		45,003,924		45,676,922
Tangible book value per common share	$	14.07	$	13.60

The tangible common equity ratio and tangible book value per common share are non-GAAP measures. Management and many stock analysts use the tangible common equity ratio and tangible book value per common share in conjunction with more traditional bank capital ratios to compare the capital adequacy of banking organizations. Neither tangible common equity nor tangible assets or related measures should be considered in isolation or as a substitute for stockholders’ equity, total assets or any other measure calculated in accordance with GAAP. Moreover, the manner in which the Company calculates its tangible common equity, tangible assets and any other related measures may differ from that of other companies reporting measures with similar names.

The Tier 1 common equity to risk-weighted assets ratio is another non-GAAP measure. Ratios calculated based upon Tier 1 common equity have become a focus of regulators and investors, and management believes ratios based on Tier 1 common equity assist investors in analyzing the Company’s capital position. In connection with the 2009 Supervisory Capital Assessment Program, the Federal Reserve Board supplemented its assessment of the capital adequacy of certain large bank holding companies based on a variation of Tier 1 capital, known as Tier 1 common equity.

Because Tier 1 common equity is not formally defined by GAAP or, unlike Tier 1 capital, codified in the federal banking regulations, this measure is considered to be a non-GAAP financial measure. Non-GAAP financial measures have inherent limitations, are not required to be uniformly applied and are not audited. To mitigate these limitations, the Company has procedures in place to calculate these measures using the appropriate GAAP or regulatory components. Although these non-GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analyses of results as reported under GAAP.

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The table below presents a reconciliation of the Company’s total common equity (GAAP) at March 31, 2014 and December 31, 2013 to Tier 1 common equity (non-GAAP):

	March 31,		December 31,
	2014		2013
	(Dollars in thousands)
Common stockholders' equity	$	730,621	$	719,043
Unrealized gains on available-for-sale securities, net of income tax		(16,034)		(11,434)
Unrealized losses on cash flow hedges, net of income tax		8,013		8,243
Disallowed deferred tax assets		(79,016)		(80,430)
Disallowed servicing assets		(1,397)		(1,380)
Intangible assets:
Goodwill		(86,069)		(86,069)
Other intangible assets		(11,370)		(11,912)
Total Tier 1 common equity	$	544,748	$	536,062
Tier 1 common equity to risk-weighted assets		10.79%		10.44%

The following table presents the Company’s capital adequacy information at March 31, 2014 and December 31, 2013:

	March 31,		December 31,
	2014		2013
	(Dollars in thousands)
Risk-based capital:
Tier 1 capital	$	745,619	$	736,930
Supplementary (Tier 2) capital		90,549		91,546
Total risk-based capital	$	836,168	$	828,476
Risk-weighted assets:
Balance sheet items	$	4,872,822	$	4,969,531
Off-balance sheet items		177,850		165,007
Total risk-weighted assets	$	5,050,672	$	5,134,538
Ratios:
Tier 1 capital (minimum required - 4%)		14.76%		14.35%
Total capital (minimum required - 8%)		16.56%		16.14%
Leverage ratio		9.51%		9.11%
Equity to assets		11.41%		10.85%
Tangible common equity to assets		8.06%		7.61%

The Federal Reserve Board has risk-based capital guidelines for bank holding companies. Under the guidelines, the minimum ratio of qualifying total capital to risk-weighted assets is 8%. At least half of the total capital is to be comprised of qualifying common stockholders’ equity, qualifying noncumulative perpetual preferred stock (including related surplus), minority interests related to qualifying common or noncumulative perpetual preferred stock directly issued by a consolidated U.S. depository institution or foreign bank subsidiary, and restricted core capital elements (collectively, “Tier 1 Capital”). Banking organizations are expected to maintain at least 50% of their Tier 1 Capital as common equity. Except for certain debt or equity instruments issued on or after May 19, 2010, which are excluded from Tier 1 Capital , not more than 25% of qualifying Tier 1 Capital may consist of qualifying cumulative perpetual preferred stock, trust preferred securities or other so-called restricted core capital elements. “Tier 2 Capital” may consist, subject to certain limitations, of allowance for loan and lease losses; perpetual preferred stock and related surplus; hybrid capital instruments, perpetual debt, and mandatory convertible debt securities; term subordinated debt and intermediate-term preferred stock, including related surplus; and unrealized holding gains on equity securities. “Tier 3 Capital” consists of qualifying unsecured subordinated debt. The sum of Tier 2 and Tier 3 Capital may not exceed the amount of Tier 1 Capital.

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Pursuant to the Dodd-Frank Act, federal banking agencies have adopted new capital rules that became effective January 1, 2014 for advanced approaches banking organizations (i.e., those with consolidated assets greater than $250 billion or consolidated on-balance sheet foreign exposures of at least $10 billion) and January 1, 2015 for all other covered organizations (subject to certain phase-in periods through January 1, 2019) and that will replace their general risk-based capital rules, advanced approaches rule, market risk rule, and leverage rules.

The new capital rules provide certain changes to the prompt corrective action regulations adopted by the agencies under Section 38 of the FDIA, as amended by FDICIA. These regulations are designed to place restrictions on U.S. insured depository institutions if their capital levels begin to show signs of weakness. The five capital categories established by the agencies under their prompt corrective action framework are: “well capitalized,” “adequately capitalized,” “undercapitalized,” “significantly undercapitalized” and “critically undercapitalized”. As of March 31, 2014 and December 31, 2013, the Company is “well capitalized” for regulatory purposes.

The new capital rules expand such categories by introducing a common equity tier 1 capital requirement for all depository institutions, revising the minimum risk-based capital ratios and, beginning in 2018, the proposed supplementary leverage requirement for advanced approaches banking organizations. The common equity tier 1 capital ratio is a new minimum requirement designed to ensure that banking organizations hold sufficient high-quality regulatory capital that is available to absorb losses on a going-concern basis.

The Bank is considered “well capitalized” under the regulatory framework for prompt corrective action. The table below shows the Bank’s regulatory capital ratios at March 31, 2014, and December 31 2013:

	March 31 ,		December 31,		Variance
	2014		2013		%
	(Dollars in thousands)
Oriental Bank Regulatory Capital Ratios:
Total Tier 1 Capital to Total Assets		9.18%		8.57%	7.1%
Actual tier 1 capital	$	715,591	$	689,174	3.8%
Minimum capital requirement (4%)	$	311,659	$	321,551	-3.1%
Minimum to be well capitalized (5%)	$	389,574	$	401,939	-3.1%
Tier 1 Capital to Risk-Weighted Assets		14.22%		13.47%	5.6%
Actual tier 1 risk-based capital	$	715,591	$	689,174	3.8%
Minimum capital requirement (4%)	$	201,248	$	204,627	-1.7%
Minimum to be well capitalized (6%)	$	301,871	$	306,940	-1.7%
Total Capital to Risk-Weighted Assets		16.02%		15.26%	5.0%
Actual total risk-based capital	$	805,900	$	780,487	3.3%
Minimum capital requirement (8%)	$	402,495	$	409,253	-1.7%
Minimum to be well capitalized (10%)	$	503,119	$	511,567	-1.7%

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The Company’s common stock is traded on the New York Stock Exchange (“NYSE”) under the symbol “OFG.” At March 31, 2014 and December 31, 2013, the Company’s market capitalization for its outstanding common stock was $773.6 million ($17.19 per share) and $792.0 million ($17.34 per share), respectively.

The following table provides the high and low prices and dividends per share of the Company’s common stock for each quarter of the last two calendar years:

					Cash
	Price				Dividend
	High		Low		Per share
2014
March 31,2014	$	17.54	$	14.30	$	0.08
2013
December 31, 2013	$	17.34	$	14.74	$	0.08
September 30,2013	$	18.97	$	16.13	$	0.06
June 30, 2013	$	18.11	$	14.26	$	0.06
March 31, 2013	$	15.83	$	13.85	$	0.06
2012
December 31, 2012	$	13.35	$	9.98	$	0.06
September 30, 2012	$	11.49	$	10.02	$	0.06
June 30, 2012	$	12.37	$	9.87	$	0.06
March 31, 2012	$	12.69	$	11.25	$	0.06

Under the Company’s current stock repurchase program it is authorized to purchase in the open market up to $70 million of its outstanding shares of common stock. The shares of common stock repurchased are to be held by the Company as treasury shares. During the quarter ended March 31, 2014, the Company purchased 707,400 shares under this program for a total of $10.4 million, at an average price of $14.66 per share. There were no repurchases during 2013. The number of shares that may yet be purchased under the $70 million program is estimated at 1,341,002 and was calculated by dividing the remaining balance of $23.1 million by $17.19 (closing price of the Company common stock at March 31, 2014).

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Background

The Company’s risk management policies are established by its Board of Directors (the “Board”) and implemented by management through the adoption of a risk management program, which is overseen and monitored by the Chief Risk Officer and the Risk Management and Compliance Committee. The Company has continued to refine and enhance its risk management program by strengthening policies, processes and procedures necessary to maintain effective risk management.

All aspects of the Company’s business activities are susceptible to risk. Consequently, risk identification and monitoring are essential to risk management. As more fully discussed below, the Company’s primary risk exposures include, market, interest rate, credit, liquidity, operational and concentration risks.

Market Risk

Market risk is the risk to earnings or capital arising from adverse movements in market rates or prices, such as interest rates or prices. The Company evaluates market risk together with interest rate risk. The Company’s financial results and capital levels are constantly exposed to market risk. The Board and management are primarily responsible for ensuring that the market risk assumed by the Company complies with the guidelines established by policies approved by the Board. The Board has delegated the management of this riskto the Asset/Liability Management Committee (“ALCO”) which is composed of certain executive officers from the business, treasury and finance areas. One of ALCO’s primary goals is to ensure that the market risk assumed by the Company is within the parameters established in such policies.

Interest Rate Risk

Interest rate risk is the exposure of the Company’s earnings or capital to adverse movements in interest rates. It is a predominant market risk in terms of its potential impact on earnings. The Company manages its asset/liability position in order to limit the effects of changes in interest rates on net interest income. ALCO oversees interest rate risk, liquidity management and other related matters.

In discharging its responsibilities, ALCO examines current and expected conditions in global financial markets, competition and prevailing rates in the local deposit market, liquidity, unrealized gains and losses in securities, recent or proposed changes to the investment portfolio, alternative funding sources and their costs, hedging and the possible purchase of derivatives such as swaps, and any tax or regulatory issues which may be pertinent to these areas.

On a monthly basis, the Company performs a net interest income simulation analysis on a consolidated basis to estimate the potential change in future earnings from projected changes in interest rates. These simulations are carried out over a one-year time horizon, assuming certain gradual upward and downward interest rate movements, achieved during a twelve-month period. Simulations are carried out in two ways:

(i)using a static balance sheet as the Company had on the simulation date, and

(ii)using a dynamic balance sheet based on recent growth patterns and business strategies.

The balance sheet is divided into groups of assets and liabilities detailed by maturity or re-pricing and their corresponding interest yields and costs. As interest rates rise or fall, these simulations incorporate expected future lending rates, current and expected future funding sources and costs, the possible exercise of options, changes in prepayment rates, deposits decay and other factors which may be important in projecting the future growth of net interest income.

The Company uses a software application to project future movements in the Company’s balance sheet and income statement. The starting point of the projections generally corresponds to the actual values of the balance sheet on the date of the simulations.

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These simulations are complex, and use many assumptions that are intended to reflect the general behavior of the Company over the period in question. There can be no assurance that actual events will match these assumptions in all cases. For this reason, the results of these simulations are only approximations of the true sensitivity of net interest income to changes in market interest rates. The following table presents the results of the simulations at March 31, 2014 for the most likely scenario, assuming a one-year time horizon:

	Net Interest Income Risk (one year projection)
	Static Balance Sheet			Growing Simulation
	Amount		Percent	Amount		Percent
	Change		Change	Change		Change
Change in interest rate	(Dollars in thousands)
+ 200 Basis points	$	4,527	1.26%	$	5,209	1.45%
+ 100 Basis points	$	2,176	0.61%	$	2,516	0.70%
- 50 Basis points	$	(852)	-0.24%	$	(851)	-0.24%

The impact of -100 and -200 basis point reductions in interest rates is not presented in view of current level of the federal funds rate and other short-term interest rates.

Future net interest income could be affected by the Company’s investments in callable securities, prepayment risk related to mortgage loans and mortgage-backed securities, and any structured repurchase agreements and advances from the FHLB-NY in which it may enter into from time to time. As part of the strategy to limit the interest rate risk and reduce the re-pricing gaps of the Company’s assets and liabilities, the Company has executed certain transactions which include extending the maturity and the re-pricing frequency of the liabilities to longer terms reducing the amounts of its structured repurchase agreements and entering into hedge-designated swaps to hedge the variability of future interest cash flows of forecasted wholesale borrowings that only consist of advances from the FHLB-NY as of March 31, 2014.

The Company maintains an overall interest rate risk management strategy that incorporates the use of derivative instruments to minimize significant unplanned fluctuations in earnings that are caused by interest rate volatility. The Company’s goal is to manage interest rate sensitivity by modifying the repricing or maturity characteristics of certain balance sheet assets and liabilities so that the net interest margin is not, on a material basis, adversely affected by movements in interest rates. As a result of interest rate fluctuations, hedged fixed-rate assets and liabilities will appreciate or depreciate in market value. Also, for some fixed-rate assets or liabilities, the effect of this variability in earnings is expected to be substantially offset by the Company’s gains and losses on the derivative instruments that are linked to the forecasted cash flows of these hedged assets and liabilities. The Company considers its strategic use of derivatives to be a prudent method of managing interest-rate sensitivity as it reduces the exposure of earnings and the market value of its equity to undue risk posed by changes in interest rates. The effect of this unrealized appreciation or depreciation is expected to be substantially offset by the Company’s gains or losses on the derivative instruments that are linked to these hedged assets and liabilities. Another result of interest rate fluctuations is that the contractual interest income and interest expense of hedged variable-rate assets and liabilities, respectively, will increase or decrease.

Derivative instruments that are used as part of the Company’s interest risk management strategy include interest rate swaps, forward-settlement swaps, futures contracts, and option contracts that have indices related to the pricing of specific balance sheet assets and liabilities. Interest rate swaps generally involve the exchange of fixed and variable-rate interest payments between two parties based on a common notional principal amount and maturity date. Interest rate futures generally involve exchanged-traded contracts to buy or sell U.S. Treasury bonds and notes in the future at specified prices. Interest rate options represent contracts that allow the holder of the option to (i) receive cash or (ii) purchase, sell, or enter into a financial instrument at a specified price within a specified period. Some purchased option contracts give the Company the right to enter into interest rate swaps and cap and floor agreements with the writer of the option. In addition, the Company enters into certain transactions that contain embedded derivatives. When the embedded derivative possesses economic characteristics that are not clearly and closely related to the economic characteristics of the host contract, it is bifurcated and carried at fair value. Please refer to Note 7 to the accompanying unaudited consolidated financial statements for further information concerning the Company’s derivative activities.

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Following is a summary of certain strategies, including derivative activities, currently used by the Company to manage interest rate risk:

Interest rate swaps — The Company entered into hedge-designated swaps to hedge the variability of future interest cash flows of forecasted wholesale borrowings, attributable to changes in the one-month LIBOR rate. Once the forecasted wholesaleborrowings transactions occurred, the interest rate swap effectively fixes the Company’s interest payments on an amount of forecasted interest expense attributable to the one-month LIBOR rate corresponding to the swap notional stated rate. A derivative asset of $166 thousand (notional amount of $40.3 million) and a derivative liability of $10.7 million (notional amount of $225.0 million) were recognized at March 31, 2014, related to the valuation of these swaps. Refer to Note 7 of the unaudited consolidated financial statements for a description of these swaps.

In addition, the Company has certain derivative contracts, including interest rate swaps not designated as hedging instruments, which are utilized to convert certain variable rate loans to fixed-rate loans, and the mirror-images of these interest rate swaps in which the Company enters into to minimize its interest rate risk exposure that results from offering the derivatives to clients. These interest rate swaps are marked to market through earnings. At March 31, 2014, interest rate swaps offered to clients not designated as hedging instruments represented a derivative asset of $2.8 million (notional amounts of $16.6 million), and the mirror-image interest rate swaps in which BBVAPR entered into represented a derivative liability of $2.8 million (notional amounts of $16.6 million). Refer to Note 7 of the unaudited consolidated financial statements for a description of these swaps.

S&P options — The Company has offered its customers certificates of deposit with an option tied to the performance of the S&P 500 Index. At the end of five years, the depositor receives a minimum return or a specified percentage of the average increase of the month-end value of the S&P 500 Index. The Company uses option agreements with major money center banks and major broker-dealer companies to manage its exposure to changes in that index. Under the terms of the option agreements, the Company receives the average increase in the month-end value of S&P 500 Index in exchange for a fixed premium. The changes in fair value of the options purchased and the options embedded in the certificates of deposit are recorded in earnings.

At March 31, 2014, the fair value of the purchased options used to manage the exposure to the S&P 500 Index on stock-indexed certificates of deposit represented an asset of $12.6 million (notional amounts of $23.8 million) and the options sold to customers embedded in the certificates of deposit represented a liability of $12.1 million (notional amount of $22.9 million).

Wholesale borrowings — The Company uses interest rate swaps to hedge the variability of interest cash flows of certain advances from the FHLB-NY that are tied to a variable rate index. The interest rate swaps effectively fix the Company’s interest payments on these borrowings. As of March 31, 2014, the Company had $265 million in interest rate swaps at an average rate of 2.6% designated as cash flow hedges for $265 million in advances from the FHLB-NY that reprice or are being rolled over on a monthly basis.

Credit Risk

Credit risk is the possibility of loss arising from a borrower or counterparty in a credit-related contract failing to perform in accordance with its terms. The principal source of credit risk for the Company is its lending activities. In Puerto Rico, the Company’s principal market, economic conditions are challenging, as they have been for the last eight years, due to a shrinking population, a protracted economic recession, a housing sector that remains under pressure, and the Puerto Rico government’s large indebtedness and structural budget deficit, and the recent rating downgrades of Puerto Rico general obligations and certain other government bonds to levels that are below investment grade.

The Company manages its credit risk through a comprehensive credit policy which establishes sound underwriting standards by monitoring and evaluating loan portfolio quality, and by the constant assessment of reserves and loan concentrations. The Company also employs proactive collection and loss mitigation practices.

The Company may also encounter risk of default in relation to its securities portfolio. The securities held by the Company are principally agency mortgage-backed securities. Thus, a substantial portion of these instruments are guaranteed by mortgages, a U.S. government-sponsored entity, or the full faith and credit of the U.S. government.

The Company’s Executive Credit Committee, composed of its Chief Executive Officer, Chief Credit Risk Officer and other senior executives, has primary responsibility for setting strategies to achieve the Company’s credit risk goals and objectives. Those goals and objectives are set forth in the Company’s Credit Policy as approved by the Board.

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Liquidity Risk

Liquidity risk is the risk of the Company not being able to generate sufficient cash from either assets or liabilities to meet obligations as they become due without incurring substantial losses. The Board has established a policy tomanage this risk. The Company’s cash requirements principally consist of deposit withdrawals, contractual loan funding, repayment of borrowings as these mature, and funding of new and existing investments as required.

The Company’s business requires continuous access to various funding sources. While the Company is able to fund its operations through deposits as well as through advances from the FHLB-NY and other alternative sources, the Company’s business is dependent upon other wholesale funding sources. Although the Company has selectively reduced its use of wholesale funding sources, such as repurchase agreements and brokered deposits, it is still dependent on wholesale funding sources. As of March 31, 2014, the Company had $1.010 billion in repurchase agreements and $712.9 million in brokered deposits.  

Brokered deposits are typically offered through an intermediary to small retail investors. The Company’s ability to continue to attract brokered deposits is subject to variability based upon a number of factors, including volume and volatility in the global securities markets, the Company’s credit rating, and the relative interest rates that it is prepared to pay for these liabilities. Brokered deposits are generally considered a less stable source of funding than core deposits obtained through retail bank branches. Investors in brokered deposits are generally more sensitive to interest rates and will generally move funds from one depository institution to another based on small differences in interest rates offered on deposits.

The Company participates in the Federal Reserve Bank’s Borrower-In Custody Program which allows it to pledge certain type of loans while keeping physical control of the collateral.

Although the Company expects to have continued access to credit from the foregoing sources of funds, there can be no assurance that such financing sources will continue to be available or will be available on favorable terms. In a period of financial disruption or if negative developments occur with respect to the Company, the availability and cost of the Company’s funding sources could be adversely affected. In that event, the Company’s cost of funds may increase, thereby reducing its net interest income, or the Company may need to dispose of a portion of its investment portfolio, which depending upon market conditions, could result in realizing a loss or experiencing other adverse accounting consequences upon any such dispositions. The Company’s efforts to monitor and manage liquidity risk may not be successful to deal with dramatic or unanticipated changes in the global securities markets or other reductions in liquidity driven by the Company or market-related events. In the event that such sources of funds are reduced or eliminated and the Company is not able to replace these on a cost-effective basis, the Company may be forced to curtail or cease its loan origination business and treasury activities, which would have a material adverse effect on its operations and financial condition.

As of March 31, 2014, the Company had approximately $624.6 million in unrestricted cash and cash equivalents, $235.7 million in investment securities that are not pledged as collateral, $614 million in borrowing capacity at the FHLB-NY and $861 million in borrowing capacity at the Federal Reserve’s discount window available to cover liquidity needs.

112

Operational Risk

Operational risk is the risk of loss from inadequate or failed internal processes, personnel and systems or from external events. All functions, products and services of the Company are susceptible to operational risk.

The Company faces ongoing and emerging risk and regulatory pressure related to the activities that surround the delivery of banking and financial products and services. Coupled with external influences such as market conditions, security risks, and legal risk, the potential for operational and reputational loss has increased. In order to mitigate and control operational risk, the Company has developed, and continues to enhance, specific internal controls, policies and procedures that are designed to identify and manage operational risk at appropriate levels throughout the organization. The purpose of these policies and procedures is to provide reasonable assurance that the Company’s business operations are functioning within established limits.

The Company classifies operational risk into two major categories: business specific and corporate-wide affecting all business lines. For business specific risks, a risk assessment group works with the various business units to ensure consistency in policies, processes and assessments. With respect to corporate-wide risks, such as information security, business recovery, legal and compliance, the Company has specialized groups, such as Information Security, Enterprise Risk Management, Corporate Compliance, Information Technology, Legal and Operations. These groups assist the lines of business in the development and implementation of risk management practices specific to the needs of the business groups. All these matters are reviewed and discussed in the Information Technology Steering Committee, and the Risk Management and Compliance Committee.

The Company is subject to extensive United States federal and Puerto Rico regulations, and this regulatory scrutiny has been significantly increasing over the last several years. The Company has established and continues to enhance procedures based on legal and regulatory requirements that are reasonably designed to ensure compliance with all applicable statutory and regulatory requirements. The Company has a corporate compliance function headed by a Compliance Director who reports to the Chief Risk Officer and is responsible for the oversight of regulatory compliance and implementation of a company-wide compliance program.

Concentration Risk

Substantially all of the Company’s business activities and a significant portion of its credit exposure are concentrated in Puerto Rico. As a consequence, the Company’s profitability and financial condition may be adversely affected by an extended economic slowdown, adverse political or economic developments in Puerto Rico or the effects of a natural disaster, all of which could result in a reduction in loan originations, an increase in non-performing assets, an increase in foreclosure losses on mortgage loans, and a reduction in the value of its loans and loan servicing portfolio.

ITEM 4.   CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As of the end of the period covered by this quarterly report on Form 10-Q, an evaluation was carried out under the supervision and with the participation of the Company’s management, including the Chief Executive Officer (“CEO”) and the Chief Financial Officer (“CFO”), of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based upon such evaluation, the CEO and the CFO have concluded that, as of the end of such period, the Company’s disclosure controls and procedures provided reasonable assurance of effectiveness in recording, processing, summarizing and reporting, on a timely basis, information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act. Notwithstanding the foregoing, a control system, no matter how well designed and operated, can provide only reasonable, not absolute assurance that it will detect or uncover failures within the Company to disclose material information otherwise required to be set forth in the Company’s periodic reports.

Internal Control over Financial Reporting

There have not been any changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d -15 (f) under the Exchange Act) during the quarter ended March 31, 2014, that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

113

PART - II OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS

The Company and its subsidiaries are defendants in a number of legal proceedings incidental to their business. The Company is vigorously contesting such claims. Based upon a review by legal counsel and the development of these matters to date, management is of the opinion that the ultimate aggregate liability, if any, resulting from these claims will not have a material adverse effect on the Company’s financial condition or results of operations.

ITEM 1A.  RISK FACTORS

Except as set forth below, there have been no material changes to the risk factors previously disclosed in the Company’s annual report on Form 10-K for the year ended December 31, 2013. In addition to other information set forth in this report, you should carefully consider the risk factors included in the Company’s annual report on Form 10-K, as updated by this report or other filings the Company makes with the SEC under the Exchange Act. Additional risks and uncertainties not presently known to the Company at this time or that the Company currently deems immaterial may also adversely affect the Company’s business, financial condition or results of operations.

We rely on the services of third parties for our banking, information technology, telecommunications, and mortgage loan servicing infrastructure, and any failure, interruption or termination of such services or systems could have a material adverse affect on our financial condition and results of operations.

Our business relies on the secure, successful and uninterrupted functioning of our banking, information technology, telecommunications, and mortgage loan servicing infrastructure. We outsource some of our major systems, such as customer data and deposit processing, mortgage loan servicing, Internet and mobile banking, and electronic fund transfer systems. The failure or interruption of such systems, or the termination of a third-party software license or mortgage servicing, or any service agreement on which any of these systems or services is based, could interrupt our operations.  Because our information technology and telecommunications systems interface with and depend on third-party systems, we could experience service denials if demand for such services exceeds capacity or such systems fail or experience interruptions. 

We periodically sell or securitize our mortgage loans while retaining the obligation to perform the servicing of such loans.  Although we are the master servicer of our mortgage loan portfolios, we outsource our servicing functions pursuant to a subservicing arrangement with a third party in Puerto Rico. The termination or interruption of such subservicing arrangement, without a feasible substitute or successor, could adversely affect our financial condition and results of operations. In addition, because the FDIC has the right to refuse or delay payment for loan and lease losses if the shared-loss agreements are not performed by us in accordance with their terms, any such termination or interruption of the subservicing of the covered loans that we acquired in the FDIC-assisted acquisition could adversely affect our ability to comply with such terms.

If sustained or repeated, a failure, denial or termination of such systems or services could result in a deterioration of our ability to process new loans, service existing loans, gather deposits and/or provide customer service.  It could also compromise our ability to operate effectively, damage our reputation, result in a loss of customer business and/or subject us to additional regulatory scrutiny and possible financial liability. Any of the foregoing could have a material adverse effect on our financial condition and results of operations.

114

A credit default or ratings downgrade on the Puerto Rico government’s debt obligations could adversely affect the value of our loans to the government of Puerto Rico and our investment portfolio of Puerto Rico government bonds.

Even though the economy of Puerto Rico is closely related to the economy of the rest of the United States, prevailing economic conditions and the fiscal situation of the government of Puerto Rico led Standard & Poor’s, Moody’s and Fitch to downgrade general obligations and certain other bonds of the Puerto Rico government to levels below investment grade.

Despite the Commonwealth’s progress in addressing its persistent budget deficits and underfunded government retirement plans, Puerto Rico continues to face significant economic and fiscal challenges, including a protracted economic recession, sizable debt-service obligations, high unemployment and a shrinking population. The recent Commonwealth credit downgrades by three leading rating agencies reflect only the views of such agencies, an explanation of which may be obtained from each such rating agency. Generally, below-investment-grade securities present greater risks and can be less liquid than investment-grade securities.

The reduction in the credit ratings of Puerto Rico government debt obligations could severely weaken the demand for such securities and the Commonwealth’s access to capital markets, which may affect its ability to obtain the financing that it needs. This may in turn increase the Commonwealth’s risk of default.

It is uncertain how capital markets may react to any future ratings downgrade in Puerto Rico government debt obligations. However, a further deterioration of economic or fiscal conditions in Puerto Rico, with possible negative ratings implications, could adversely affect the value of our loans to the government of Puerto Rico and the value of our investment portfolio of Puerto Rico government bonds.

At March 31, 2014, we had approximately $766.7 million of credit facilities granted to the Puerto Rico government, including its instrumentalities, public corporations and municipalities, of which $718.8 million was outstanding as of such date. A substantial portion of our credit exposure to the government of Puerto Rico consists of collateralized loans or obligations that have a specific source of income or revenues identified for its repayment. Some of these obligations consist of senior and subordinated loans to public corporations that obtain revenues from rates charged for services or products, such as water and electric power utilities. Public corporations have varying degrees of independence from the central government and many receive appropriations or other payments from it. We also have loans to various municipalities for which the good faith, credit and unlimited taxing power of the applicable municipality has been pledged to their repayment. These municipalities are required by law to levy special property taxes in such amounts as required for the payment of all of its general obligation bonds and notes. Another portion of these loans consists of special obligations of various municipalities that are payable from the basic real and personal property taxes collected within such municipalities. The good faith and credit obligations of the municipalities have a first lien on the basic property taxes.

Furthermore, as of March 31, 2014, we had approximately $42.4 million in obligations issued and guaranteed by the Puerto Rico government, including certain instrumentalities or public corporations, as part of our investment securities portfolio. We continue to closely monitor the economic and fiscal situation of Puerto Rico and evaluate the portfolio for any declines in value that management may consider being other-than-temporary.

Approximately 43% of our Puerto Rico government loans and obligations mature in the next 12 months or less. At March 31, 2014, we also had deposits of approximately $367.4 million from the government of Puerto Rico.

ITEM 2.     UNREGISTERED SALES OF EQUITY SECURITES AND USE OF PROCEEDS

On June 29, 2011, the Company announced the approval by the Board of Directors of a stock repurchase program to purchase an additional $70 million of the Company’s common stock in the open market.

Any shares of common stock repurchased are held by the Company as treasury shares. The Company records treasury stock purchases under the cost method whereby the entire cost of the acquired stock is recorded as treasury stock. During the quarter ended March 31, 2014, the Company purchased approximately 707,400 additional shares under this program for a total of $10.4 million, at an average price of $14.66 per share.

115

The following table presents the shares repurchased for each month in the quarter ended March 31, 2014, excluding the month ended March 31, 2014, during which no shares were purchased as part of the stock repurchase program: 

				Total number of		Maximum approximate
				shares purchased		dollar value of shares
	Total number of	Average price paid		as part of publicly		that may yet be purchased
Period	shares purchased	per share		announced programs		under the programs
						(In thousands)
January 1-31, 2014	57,700	$	14.73	57,700	$	32,593
February 1-28, 2014	649,700		14.66	649,700		23,052
March 1-31, 2014	-		-	-		23,052
Quarter ended March 31, 2014	707,400	$	14.66	707,400	$	23,052

The number of shares that may yet be purchased under the current $70 million program is estimated at 1,341,002, and was calculated by dividing the remaining balance of $23.1 million by $17.19 (closing price of the Company’s common stock at March 31, 2014). The Company did not purchase any shares of its common stock other than through its publicly announced stock repurchase program during the quarter ended March 31, 2014. 

ITEM 3.     DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4.     MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5.     OTHER INFORMATION

None.

ITEM 6.     EXHIBITS 

Exhibit No.Description of Document:

10.1   Amendment to Technology Outsourcing Agreement between the Company and Metavante Corporation.(1) 

 31.1   Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2    Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1    Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2    Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101     The following materials from OFG Bancorp’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2014, formatted in XBRL (eXtensible Business Reporting Language): (i) Unaudited Consolidated Statements of Financial Condition, (ii) Unaudited Consolidated Statements of Operations, (iii) Unaudited Consolidated Statements of Comprehensive Income, (iv) Unaudited Consolidated Statements of Changes in Stockholders’ Equity, (v) Unaudited Consolidated Statements of Cash Flows, and (vi) Notes to Unaudited Consolidated Financial Statements.

 (1)         Incorporated herein by reference to Exhibit 10.16 of the Company’s annual report on Form 10-K filed with the SEC on March 3, 2014. Portions of this exhibit have been omitted pursuant to a request for confidential treatment

116

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

OFG Bancorp

(Registrant)

By:	/s/ José Rafael Fernández	Date: May 9, 2014
	José Rafael Fernández
	President and Chief Executive Officer
By:	/s/ Ganesh Kumar	Date: May 9, 2014
	Ganesh Kumar
	Executive Vice President and Chief Financial Officer
By:	/s/ César A. Ortiz	Date: May 9, 2014
	César A. Ortiz
	Senior Vice President and Chief Accounting Officer

117

EX-31.1

 

EXHIBIT 31.1

MANAGEMENT CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, José Rafael Fernández, President and Chief Executive Officer of OFG Bancorp, certify that:

1.      I have reviewed this quarterly report on Form 10-Q of OFG Bancorp;

2.      Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.     Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f ) and 15d-15(f )) for the registrant and have:

a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U. S. generally accepted accounting principles;

c)     Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)     Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect the registrant’s internal control over financial reporting; and

5.     The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)     Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 9, 2014

By:        /s/ José Rafael Fernández

José Rafael Fernández

President and Chief Executive Officer

EX-31.2

 

EXHIBIT 31.2

MANAGEMENT CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Ganesh Kumar, Executive Vice President and Chief Financial Officer of OFG Bancorp, certify that:

1 .      I have reviewed this quarterly report on Form 10-Q of OFG Bancorp;

2 .      Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3 .      Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.       The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f ) and 15d-15(f )) for the registrant and have:

a)       Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)       Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles;

c)        Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)       Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect the registrant’s internal control over financial reporting; and

5.       The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

a)       All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)       Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 9, 2014

By:         /s/ Ganesh Kumar

                Ganesh Kumar

Executive Vice President and Chief Financial Officer

EX-32.1

 

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

(18 U.S.C. §1350)

In connection with OFG Bancorp’s quarterly report on Form 10-Q for the period ended March 31, 2014, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, José Rafael Fernández, President and Chief Executive Officer of OFG Bancorp, hereby certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. §1350), that:

(1)      The Report fully complies with the requirements of Section 13(a) or 15 (d) of the Securities Exchange Act of 1934; and

(2)      The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of OFG Bancorp.

In witness whereof, I execute this certification in San Juan, Puerto Rico, this 9th day of May, 2014.

                                                                                                                                By:         /s/ José Rafael Fernández

                                                                                                                                                José Rafael Fernández

                                                                                                                                                President and Chief Executive Officer

EX-32.2

 

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

(18 U.S.C. §1350)

In connection with OFG Bancorp’s quarterly report on Form 10-Q for the period ended March 31, 2014, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Ganesh Kumar, Executive Vice President and Chief Financial Officer of OFG Bancorp, hereby certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. §1350), that:

(1)      The Report fully complies with the requirements of Section 13(a) or 15 (d) of the Securities Exchange Act of 1934; and

(2)      The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of OFG Bancorp.

In witness whereof, I execute this certification in San Juan, Puerto Rico, this 9th day of May, 2014.

By:         /s/ Ganesh Kumar

                Ganesh Kumar

Executive Vice President and Chief Financial Officer

XML

Guarantees (Tables)

3 Months Ended

Mar. 31, 2014

Guarantees [Abstract]

Schedule Of Guarantee Obligations Text Block

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Balance at beginning of year	$	1,955	$	-
Additions from BBVAPR Acquisition		-		2,460
Net charge-offs/terminations		(406)		-
Balance at end of year	$	1,549	$	2,460

Summarized credit-related financial instruments at March 31, 2014 and December 31, 2013were as follows:

XML

Loans Receivable (Accretable yield and non-accretable discount activity) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward]
Additions accretable	$ 0
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Non Accretable Discount Movement Schedule [Roll Forward]
Additions non-accretable	0
Acquired under ASC 310-30 Non-Covered Loans [Member]
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward]
Balance at beginning of period	517,553	655,833
Accretion Accretable	(40,269)	(47,668)
Transfer from (to) non-accretable discount	4,717	0
Balance at end of period	482,001	608,165
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Non Accretable Discount Movement Schedule [Roll Forward]
Balance at beginning of period	579,587	714,462
Principal Losses	(11,576)	(8,746)
Transfer (to) from accretable yield	(4,717)	0
Balance at end of period	$ 563,294	$ 705,716

XML

Securities Purchased Under Agreements to Resell and Investment (Gains and losses by category) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
12 months or more
Available for sale - Amortized cost	$ 24,344	$ 23,485
Available for sale - Unrealized Loss	5,471	5,718
Available-for-sale, Fair Value	18,873	17,767
Less than 12 months
Available for sale - Amortized cost	402,468	534,577
Available for sale - Unrealized Loss	8,721	14,996
Available for sale - Fair Value	393,747	519,581
Available for sale - amortized cost	426,812	558,062
Available for sale - unrealized loss	14,192	20,714
Total Fair Value	412,620	537,348
Collateralized Mortgage Obligations [Member]
12 months or more
Available for sale - Amortized cost	1,897	2,559
Available for sale - Unrealized Loss	163	237
Available-for-sale, Fair Value	1,734	2,322
Less than 12 months
Available for sale - Amortized cost	177,882	182,661
Available for sale - Unrealized Loss	3,976	6,577
Available for sale - Fair Value	173,906	176,084
Available for sale - amortized cost	179,779	185,220
Available for sale - unrealized loss	4,139	6,814
Total Fair Value	175,640	178,406
US States and Political Subdivisions Debt Securities [Member]
12 months or more
Available for sale - Amortized cost	22,367	20,845
Available for sale - Unrealized Loss	5,298	5,470
Available-for-sale, Fair Value	17,069	15,375
Less than 12 months
Available for sale - Amortized cost		100,190
Available for sale - Unrealized Loss		1,375
Available for sale - Fair Value		98,815
Available for sale - amortized cost	22,367	121,035
Available for sale - unrealized loss	5,298	6,845
Total Fair Value	17,069	114,190
Government National Mortgage Association Certificates and Obligations (GNMA) [Member]
12 months or more
Available for sale - Amortized cost	80	81
Available for sale - Unrealized Loss	10	11
Available-for-sale, Fair Value	70	70
Less than 12 months
Available for sale - Amortized cost	121	122
Available for sale - Unrealized Loss	13	13
Available for sale - Fair Value	108	109
Available for sale - amortized cost	201	203
Available for sale - unrealized loss	23	24
Total Fair Value	178	179
FNMA and FHLMC [Member]
Less than 12 months
Available for sale - Amortized cost	214,926	220,913
Available for sale - Unrealized Loss	4,690	6,669
Available for sale - Fair Value	210,236	214,244
Available for sale - amortized cost	214,926	220,913
Available for sale - unrealized loss	4,690	6,669
Total Fair Value	210,236	214,244
Other Debt Obligations [Member]
Less than 12 months
Available for sale - Amortized cost		20,000
Available for sale - Unrealized Loss		320
Available for sale - Fair Value		19,680
Available for sale - amortized cost		20,000
Available for sale - unrealized loss		320
Total Fair Value		19,680
US Government-sponsored Enterprises Debt Securities [Member]
Less than 12 months
Available for sale - Amortized cost	9,539	10,691
Available for sale - Unrealized Loss	42	42
Available for sale - Fair Value	9,497	10,649
Available for sale - amortized cost	9,539	10,691
Available for sale - unrealized loss	42	42
Total Fair Value	$ 9,497	$ 10,649

XML

FDIC Loss Share Asset and True-up Payment Obligation (FDIC Indemnification Asset Roll Forward) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
FDIC Indemnification Asset [Roll Forward]
Balance	$ 189,240	$ 302,295
Shared-loss agreements reimbursements from the FDIC	8,236	6,650
Increase (decrease) in expected credit losses to be covered under shared-loss agreements, net	40	(1,822)
FDIC shared-loss asset, expense	(17,622)	(12,201)
Incurred expenses to be reimbursed under shared-loss agreements	2,772	1,502
Balance	166,194	283,124
True-up payment obligation [Roll Forward]
Balance	18,510	15,496
FDIC shared loss expense	865	670
Balance	$ 19,375	$ 16,166

XML

Loans Receivable (Accretable yield and non-accretable discount activity of covered loans) (Details) (Acquired Loans In An F D I C Assisted Transaction [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Acquired Loans In An F D I C Assisted Transaction [Member]
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Accretable Yield Movement Schedule [Roll Forward]
Balance at beginning of period	$ 162,959	$ 188,008
Accretion Accretable	(23,388)	(20,229)
Transfer from (to) non-accretable discount	8,196	6,328
Balance at end of period	147,767	174,107
Certain Loans Acquired in Transfer Not Accounted for as Debt Securities, Non Accretable Discount Movement Schedule [Roll Forward]
Balance at beginning of period	129,477	237,555
Principal Losses	(13,958)	(16,991)
Transfer (to) from accretable yield	(8,196)	(6,328)
Balance at end of period	$ 107,323	$ 214,236

XML

Deposits and Related Interest (Narratives) (Details) (USD $)	Mar. 31, 2014	Dec. 31, 2013
Deposits [Abstract]
Weighted Average Rate Domestic Deposit	0.68%	0.73%
Puerto Rico Cash & Money Market Fund Deposits	$ 97,900,000	$ 93,100,000
Puerto Rico Cash & Money Market Fund Deposits Weighted Average Rate	0.77%	0.77%
Puerto Rico Cash & Money Market Fund Deposits Collateral	77,200,000	67,500,000
Time Deposits, $100,000 or More	769,100,000	845,800,000
Public Fund Time Deposits, $100,000 or more	6,800,000	26,700,000
Public Fund Time Deposits Weighted Average Rate, $100,000 or more	0.49%	0.32%
Public Fund Time Deposits Collateral Investments		97,800,000
Public Fund Time Deposits Collateral Commercial Loans	547,300,000	549,000,000
Accrued Interest, Time Deposits	1,700,000
Unamortized deposit discounts	3,300,000
Bank Overdrafts	734,000	1,800,000
Brokered Certificates of Deposits	617,700,000	729,800,000
Brokered Money Market Deposit	$ 95,200,000	$ 98,300,000

XML

Commitments (Summarized credit-related financial instruments) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Commitments and Contingencies [Abstract]
Commitments To Extend Credit	$ 494,327	$ 520,269
Commercial letters credit	1,740	1,096
Standby letters of credit and financial guarantees	38,875	38,577
Loans sold with recourse	118,163	122,291
Commitments To Sell Or Securitize Mortgage Loans	$ 34,220	$ 99,307

XML

Securities Purchased Under Agreements to Resell and Investment (Investment securities by contractual maturity) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Schedule of Investments [Line Items]
Available for sale Amortized Cost	$ 1,437,106	$ 1,575,043
Available-for-sale Securities	1,455,685	1,588,425
Collateralized Mortgage Backed Securities [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	1,311,171	1,419,117
Available-for-sale Securities	1,334,865	1,439,539
Collateralized Mortgage Backed Securities [Member] | FNMA and FHLMC [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	1,093,717	1,190,910
Available-for-sale Securities	1,120,796	1,217,330
Collateralized Mortgage Backed Securities [Member] | GNMA [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	6,146	7,406
Available-for-sale Securities	6,549	7,815
Collateralized Mortgage Backed Securities [Member] | CMO's [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	211,308	220,801
Available-for-sale Securities	207,520	214,394
Collateralized Mortgage Backed Securities [Member] | Maturities Due From Five To Ten Years [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	26,294
Available-for-sale Securities	26,625
Collateralized Mortgage Backed Securities [Member] | Maturities Due From Five To Ten Years [Member] | FNMA and FHLMC [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	26,294
Available-for-sale Securities	26,625
Collateralized Mortgage Backed Securities [Member] | Maturities Due After Ten Years [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	1,284,877
Available-for-sale Securities	1,308,240
Collateralized Mortgage Backed Securities [Member] | Maturities Due After Ten Years [Member] | FNMA and FHLMC [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	1,067,423
Available-for-sale Securities	1,094,171
Collateralized Mortgage Backed Securities [Member] | Maturities Due After Ten Years [Member] | GNMA [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	6,146
Available-for-sale Securities	6,549
Collateralized Mortgage Backed Securities [Member] | Maturities Due After Ten Years [Member] | CMO's [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	211,308
Available-for-sale Securities	207,520
Securities Investment [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	125,935	155,926
Available-for-sale Securities	120,820	148,886
Securities Investment [Member] | US Treasury Securities [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	70,000
Available-for-sale Securities	70,000
Securities Investment [Member] | Obligation of US Government sponsored agencies [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	9,539	10,691
Available-for-sale Securities	9,497	10,649
Securities Investment [Member] | Obligation of Puerto Rico Government and political subdivisions [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	22,367	121,035
Available-for-sale Securities	17,069	114,190
Securities Investment [Member] | Other Debt Obligations [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	24,029	24,200
Available-for-sale Securities	24,254	24,047
Securities Investment [Member] | Maturities Due In Less Than One Year [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	90,000
Available-for-sale Securities	90,053
Securities Investment [Member] | Maturities Due In Less Than One Year [Member] | US Treasury Securities [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	70,000
Available-for-sale Securities	70,000
Securities Investment [Member] | Maturities Due In Less Than One Year [Member] | Other Debt Obligations [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	20,000
Available-for-sale Securities	20,053
Securities Investment [Member] | Maturities Due From One To Five Years [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	11,903
Available-for-sale Securities	9,827
Securities Investment [Member] | Maturities Due From One To Five Years [Member] | Obligation of Puerto Rico Government and political subdivisions [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	11,903
Available-for-sale Securities	9,827
Securities Investment [Member] | Maturities Due From Five To Ten Years [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	9,539
Available-for-sale Securities	9,497
Securities Investment [Member] | Maturities Due From Five To Ten Years [Member] | Obligation of US Government sponsored agencies [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	9,539
Available-for-sale Securities	9,497
Securities Investment [Member] | Maturities Due After Ten Years [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	14,493
Available-for-sale Securities	11,443
Securities Investment [Member] | Maturities Due After Ten Years [Member] | Obligation of Puerto Rico Government and political subdivisions [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	10,464
Available-for-sale Securities	7,242
Securities Investment [Member] | Maturities Due After Ten Years [Member] | Other Debt Obligations [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	4,029
Available-for-sale Securities	$ 4,201

XML

Accrued Interest Receivable and Other Assets (Tables)

3 Months Ended

Mar. 31, 2014

Other asset

Schedule of Accrued interest receivable [Table Text Block]

	March 31,		December 31,
	2014		2013
	(In thousands)
Non-covered loans	$	14,440	$	13,378
Investments		4,529		5,356
	$	18,969	$	18,734

Schedule of Other Assets [Table Text Block]

Other assets at March 31, 2014 and December 31, 2013 consist of the following

		March 31,		December 31,
	2014		2013
	(In thousands)
Prepaid expenses	$	15,531	$	15,439
Core deposit and customer relationship intangibles		11,370		11,912
Other repossessed assets		13,964		12,583
Mortgage tax credits		8,706		8,706
Investment in Statutory Trust		1,083		1,083
Accounts receivable and other assets		43,689		48,717
	$	94,343	$	98,440

XML

Deposits and Related Interest (Deposits by Components) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Deposits, by Component, Alternative [Abstract]
Noninterest-bearing demand deposit	$ 755,909	$ 550,302
Interest-bearing saving and demand deposits	2,604,664	2,683,996
Individual Retirement Account	338,719	347,262
Retail certificates of deposists	556,928	598,367
Institutional certificates of deposits	331,859	375,224
Total Core Deposits	4,588,079	4,555,151
Brokered Deposists	$ 712,913	$ 828,114

XML

Derivative Activities (Interest rate swap and their term) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014
Interest rate swap designated as cash flow hedges
Derivative [Line Items]
Amount	$ 265,277
Interest rate swap designated as cash flow hedges | Rate 2.4365% [Member]
Derivative [Line Items]
Amount	25,000
Fixed rate	2.4365%
Trade Date	May 05, 2011
Settlement Date	May 04, 2012
Maturity Date	May 04, 2016
Interest rate swap designated as cash flow hedges | Rate 2.6200% [Member]
Derivative [Line Items]
Amount	25,000
Fixed rate	2.62%
Trade Date	May 05, 2011
Settlement Date	Jul. 24, 2012
Maturity Date	Jul. 24, 2016
Interest rate swap designated as cash flow hedges | Rate 2.6350% [Member]
Derivative [Line Items]
Amount	25,000
Fixed rate	2.635%
Trade Date	May 05, 2011
Settlement Date	Jul. 30, 2012
Maturity Date	Jul. 30, 2016
Interest rate swap designated as cash flow hedges | Rate 2.6590% [Member]
Derivative [Line Items]
Amount	50,000
Fixed rate	2.659%
Trade Date	May 05, 2011
Settlement Date	Aug. 10, 2012
Maturity Date	Aug. 10, 2016
Interest rate swap designated as cash flow hedges | Rate 2.6750% [Member]
Derivative [Line Items]
Amount	100,000
Fixed rate	2.675%
Trade Date	May 05, 2011
Settlement Date	Aug. 16, 2012
Maturity Date	Aug. 16, 2016
Interest rate swap designated as cash flow hedges | Rate 2.4210% [Member]
Derivative [Line Items]
Amount	40,277
Fixed rate	2.421%
Trade Date	Jul. 03, 2013
Settlement Date	Jul. 03, 2013
Maturity Date	Aug. 01, 2023
Interest rate swaps not designated as hedges - offered to clients
Derivative [Line Items]
Amount	16,594
Interest rate swaps not designated as hedges - offered to clients
Derivative [Line Items]
Amount	$ 16,594

XML

Offsetting Arrangements (Assets Offsetting) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Offsetting Assets [Line Items]
Gross Amount of Recognized Assets	$ 15,861	$ 80,502
Gross amounts Offset in the Statement of Financial Condition	0	0
Net Amount of Assets in Statement of Financial Condition	15,861	80,502
Financial Instruments	6,814	67,037
Cash Collateral Received	0	6,780
Net Amount	9,047	6,685
Derivative
Offsetting Assets [Line Items]
Gross Amount of Recognized Assets	15,861	20,502
Gross amounts Offset in the Statement of Financial Condition	0	0
Net Amount of Assets in Statement of Financial Condition	15,861	20,502
Financial Instruments	6,814	2,450
Cash Collateral Received	0	6,780
Net Amount	9,047	11,272
Federal Funds Sold and Securities Borrowed or Purchased under Agreements to Resell
Offsetting Assets [Line Items]
Gross Amount of Recognized Assets		60,000
Gross amounts Offset in the Statement of Financial Condition		0
Net Amount of Assets in Statement of Financial Condition		60,000
Financial Instruments		64,587
Cash Collateral Received		0
Net Amount		$ (4,587)

XML

Allowance for Loan and Lease Losses (Narrative) (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Financing Receivable, Recorded Investment [Line Items]
Line Of Credit Facility Maximum Borrowing Capacity to Puerto Rico Government	$ 766.7	$ 763.4
Line Of Credit Facility Amount Outstanding to Puerto Rico Government	$ 718.8	$ 696.0

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Fair Value (Investment securities available-for-sale classified as level 3) (Details) (USD $) In Thousands, unless otherwise specified					3 Months Ended
	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member]	Dec. 31, 2013 Fair Value, Inputs, Level 3 [Member]	Mar. 31, 2014 Other Debt Obligations [Member] Fair Value, Inputs, Level 3 [Member]
Schedule of Available-for-sale Securities [Line Items]
Amortized Cost	$ 1,437,106	$ 1,575,043			$ 20,000
Unrealized Gains (Losses)					53
Investment securities available-for-sale, at fair value	$ 1,455,685	$ 1,588,425	$ 20,053	$ 19,680	$ 20,053
Available for sale - Weighted Average Yield	2.74%	2.89%			3.50%

XML

Accrued Interest Receivable and Other Assets (Accrued Interest)(Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Accounts Receivable Net Abstract
Accrued Interest Receivable On Non Covered Loans	$ 14,440	$ 13,378
Accrued Investment Income Receivable	$ 4,529	$ 5,356

XML

Borrowings (Advances from the Federal Home Loan Bank) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014
Advances From Federal Home Loan Banks [Line Items]
FHLB, Weighted Average Interest Rate	0.75%
Federal Home Loan Bank Advances [Member]
Advances From Federal Home Loan Banks [Line Items]
Borrowed fund	$ 335,363
Federal Home Loan Bank Advances [Member] | April 3 2017 [Member] | Four Million [Member]
Advances From Federal Home Loan Banks [Line Items]
Borrowed fund	4,673
FHLB, Weighted Average Interest Rate	1.24%
Settlement Date	Apr. 03, 2012
Maturity Date	Apr. 03, 2017
Federal Home Loan Bank Advances [Member] | January 16, 2018 [Member] | Twenty Five Millions [Member]
Advances From Federal Home Loan Banks [Line Items]
Borrowed fund	25,000
FHLB, Weighted Average Interest Rate	2.18%
Settlement Date	Jan. 16, 2013
Maturity Date	Jan. 16, 2018
Federal Home Loan Bank Advances [Member] | January 16, 2018 [Member] | Thirty Million [Member]
Advances From Federal Home Loan Banks [Line Items]
Borrowed fund	30,000
FHLB, Weighted Average Interest Rate	2.19%
Settlement Date	Jan. 16, 2013
Maturity Date	Jan. 16, 2018
Federal Home Loan Bank Advances [Member] | July 20, 2020 [Member] | Eleven Million [Member]
Advances From Federal Home Loan Banks [Line Items]
Borrowed fund	10,413
FHLB, Weighted Average Interest Rate	2.59%
Settlement Date	Jul. 19, 2013
Maturity Date	Jul. 20, 2020
Federal Loan Home Bank Advances Short Term Period Matured [Member] | April 4, 2014 [Member] | Twenty Five Millions [Member]
Advances From Federal Home Loan Banks [Line Items]
Borrowed fund	25,000
FHLB, Weighted Average Interest Rate	0.37%
Settlement Date	Mar. 04, 2014
Maturity Date	Apr. 04, 2014
Federal Loan Home Bank Advances Short Term Period Matured [Member] | April 10, 2014 [Member] | Fifty Millions [Member]
Advances From Federal Home Loan Banks [Line Items]
Borrowed fund	50,000
FHLB, Weighted Average Interest Rate	0.39%
Settlement Date	Mar. 10, 2014
Maturity Date	Apr. 10, 2014
Federal Loan Home Bank Advances Short Term Period Matured [Member] | April 16, 2014 [Member] | One Hundred Millions [Member]
Advances From Federal Home Loan Banks [Line Items]
Borrowed fund	100,000
FHLB, Weighted Average Interest Rate	0.38%
Settlement Date	Mar. 17, 2014
Maturity Date	Apr. 16, 2014
Federal Loan Home Bank Advances Short Term Period Matured [Member] | April 24, 2014 [Member] | Twenty Five Millions [Member]
Advances From Federal Home Loan Banks [Line Items]
Borrowed fund	25,000
FHLB, Weighted Average Interest Rate	0.36%
Settlement Date	Mar. 24, 2014
Maturity Date	Apr. 24, 2014
Federal Loan Home Bank Advances Short Term Period Matured [Member] | April 30, 2014 [Member] | Twenty Five Millions [Member]
Advances From Federal Home Loan Banks [Line Items]
Borrowed fund	25,000
FHLB, Weighted Average Interest Rate	0.36%
Settlement Date	Mar. 31, 2014
Maturity Date	Apr. 30, 2014
Federal Loan Home Bank Advances Short Term Period Matured [Member] | April 1, 2014 [Member] | Fourty Million [Member]
Advances From Federal Home Loan Banks [Line Items]
Borrowed fund	$ 40,277
FHLB, Weighted Average Interest Rate	0.37%
Settlement Date	Mar. 03, 2014
Maturity Date	Apr. 01, 2014

XML

Deposits and Related Interest (Maturities of Time Deposits) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014
Maturities of Time Deposits [Abstract]
Time Deposit Maturities Less Than Three Month	$ 303,340
Time Deposit Maturities Three To Twelve Month	780,260
Total Time deposits	1,083,600
Time Deposit Maturities, Year Two	351,142
Time Deposit Maturities, Year Three	257,750
Time Deposit Maturities, Year Four	84,607
Time Deposit Maturities, Year Five	52,029
Certificates of deposit	$ 1,829,128

XML

Borrowings (Redemption Fund) (Details) (Redemption Fund [Member], USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Mar. 31, 2013
Redemption Fund [Member]
Debt Instrument [Line Items]
Redemption fund - March 31, 2014	$ 48,575
2014	6,700
2015	6,700
2016	5,025
Total		$ 67,000

XML

Accrued Interest and Other Assets (Other assets) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2013
Other asset
Other prepaid expenses	$ 15,531	$ 15,439
Core deposit intangible and customer relationship intangibles	11,370	11,912
Other Foreclosed Assets	13,964	12,583
Mortgage tax credits	8,706	8,706
Investment in Statutory Trust	1,083	1,083
Accounts receivable and other assets	43,689	48,717
Other assets	$ 94,343	$ 98,440	$ 98,440

XML

Derivative Activities (Narratives) (Details) (USD $)	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Derivative Instruments, Gain (Loss) [Line Items]
Unrealized Gain (Loss) on Interest Rate Cash Flow Hedges, Pretax, Accumulated Other Comprehensive Income (Loss)	$ 378,000	$ 1,462,000
Notional Amount Purchased Option	23,800,000		28,000,000
Embedded Derivative, Fair Value of Embedded Derivative Liability	12,100,000		15,700,000
Notional Amount Embedded Option	22,900,000		26,900,000
Interest Rate Cap [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative, Notional Amount	110,000,000		110,000,000
Unrealized Gain (Loss) on Interest Rate Cash Flow Hedges, Pretax, Accumulated Other Comprehensive Income (Loss)	$ 10,500,000

XML

Business Segments

3 Months Ended

Mar. 31, 2014

Segment Reporting [Abstract]

SEGMENT REPORTING

NOTE 18–BUSINESSSEGMENTS

The Company segregates its businesses into the following major reportable segments of business: Banking, Wealth Management, and Treasury. Management established the reportable segments based on the internal reporting used to evaluate performance and to assess where to allocate resources. Other factors such as the Company's organization, nature of its products, distribution channels and economic characteristics of the products were also considered in the determination of the reportable segments. The Company measures the performance of these reportable segments based on pre-established goals of different financial parameters such as net income, net interest income, loan production, and fees generated. The Company's methodology for allocating non-interest expenses among segments is based on several factors such as revenue, employee headcount, occupied space, dedicated services or time, among others. These factors are reviewed on a periodical basis and may change if the conditions warrant.

Banking includes the Bank's branches and traditional banking products such as deposits and commercial, consumer and mortgage loans. Mortgage banking activities are carried out by the Bank's mortgage banking division, whose principal activity is to originate mortgage loans for the Company's own portfolio. As part of its mortgage banking activities, the Company may sell loans directly into the secondary market or securitize conforming loans into mortgage-backed securities.

Wealth Managementis comprised of the Bank's trust division, Oriental Financial Services, Oriental Insurance, and CPC. The core operations of this segment are financial planning, money management and investment banking, brokerage services, insurance sales activity, corporate and individual trust and retirement services, as well as pension plan administration services.

The Treasury segment encompasses all of the Company's asset/liability management activities, such as purchases and sales of investment securities, interest rate risk management, derivatives, and borrowings. Intersegment sales and transfers, if any, are accounted for as if the sales or transfers were to third parties, that is, at current market prices.

Following are the results of operations and the selected financial information by operating segment as of and for the quartersendedMarch 31, 2014and 2013:

	Quarter Ended March 31, 2014
			Wealth				Total Major				Consolidated
	Banking		Management		Treasury		Segments		Eliminations		Total
	(In thousands)
Interest income	$	108,631	$	40	$	14,403	$	123,074	$	-	$	123,074
Interest expense		(7,516)		-		(12,160)		(19,676)		-		(19,676)
Net interest income		101,115		40		2,243		103,398		-		103,398
Provision for non-covered loan and lease losses		(10,062)		-		-		(10,062)		-		(10,062)
Provision for covered loan and lease losses		(1,629)		-		-		(1,629)		-		(1,629)
Non-interest income (loss)		(5,047)		6,522		3,803		5,278		-		5,278
Non-interest expenses		(53,596)		(4,779)		(3,078)		(61,453)		-		(61,453)
Intersegment revenue		544		-		-		544		(544)		-
Intersegment expenses		-		(432)		(112)		(544)		544		-
Income before income taxes	$	31,325	$	1,351	$	2,856	$	35,532	$	-	$	35,532
Total assets	$	7,351,839	$	24,345	$	1,643,569	$	9,019,753	$	(1,164,115)	$	7,855,638

	Quarter Ended March 31, 2013
			Wealth				Total Major				Consolidated
	Banking		Management		Treasury		Segments		Eliminations		Total
	(In thousands)
Interest income	$	102,068	$	86	$	12,018	$	114,172	$	-	$	114,172
Interest expense		(6,971)		(60)		(13,525)		(20,556)		-		(20,556)
Net interest income		95,097		26		(1,507)		93,616		-		93,616
Provision for non-covered loan and lease losses		(7,916)		-		-		(7,916)		-		(7,916)
Provision for covered loan and lease losses, net		(672)		-		-		(672)		-		(672)
Non-interest income(loss)		2,537		7,700		(138)		10,099		-		10,099
Non-interest expenses		(61,932)		(4,462)		(415)		(66,809)		-		(66,809)
Intersegment revenue		383		-		-		383		(383)		-
Intersegment expenses		-		(302)		(81)		(383)		383		-
Income before income taxes	$	27,497	$	2,962	$	(2,141)	$	28,318	$	-	$	28,318
Total assets	$	6,989,744	$	39,511	$	2,539,649	$	9,568,904	$	(866,353)	$	8,702,551

XML

Loans Receivable (Composition of loan portfolio) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2013	Dec. 31, 2012
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount	$ 4,689,259	$ 4,669,192
Deferred loan cost (fees), net	2,318	1,035
Loans Receivable Net Of Deferred Income	4,691,577	4,670,227
Allowance for loan and lease losses on non-covered loans	(56,183)	(54,298)
Loans not covered under shared-loss agreements with the FDIC, net of allowance for loan and lease losses, excluding loans held-for-sale.	4,635,394	4,615,929
Mortgage loans held-for-sale	19,355	46,529
Loans not covered under shared-loss agreements with the FDIC, net of allowance for loan and lease losses, including loans held-for-sale.	4,654,749	4,662,458
Loans And Leases Receivable Net Reported Amount Covered [Abstract]
Loans And Leases Receivable Gross Carrying Amount Covered	402,263	409,690
Allowance for Covered Loan and Lease Losses, net	(54,398)	(52,729)	(52,974)	(54,124)
Loans covered under shared-loss agreements with the FDIC, net of allowance for loan and lease losses	347,865	356,961
Loans And Leases Receivable Net Reported Amount Covered And Not Covered	5,002,614	5,019,419
Non Covered Loan [Member]
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Allowance for loan and lease losses on non-covered loans	(56,183)	(54,298)
Originated Loans [Member]
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount	2,542,727	2,401,540
Allowance for loan and lease losses on non-covered loans	(49,507)	(49,081)
Originated Loans [Member] | Mortgages [Member]
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount	782,150	766,265
Originated Loans [Member] | Commercial Loan [Member]
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount	1,170,145	1,127,657
Originated Loans [Member] | Consumer Loan [Member]
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount	142,492	127,744
Originated Loans [Member] | Auto and Leasing loans receivable [Member]
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount	447,940	379,874
Non-covered acquired loans accounted for under ASC 310-20
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount	392,491	435,439
Allowance for loan and lease losses on non-covered loans	(3,618)	(2,354)
Non-covered acquired loans accounted for under ASC 310-20 | Commercial Loan [Member]
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount	71,577	77,681
Non-covered acquired loans accounted for under ASC 310-20 | Consumer Loan [Member]
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount	52,049	56,174
Non-covered acquired loans accounted for under ASC 310-20 | Auto
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount	268,865	301,584
Non-covered loans accounted under ASC 310-30
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount	1,754,041	1,832,213
Allowance for loan and lease losses on non-covered loans	(3,058)	(2,863)
Non-covered loans accounted under ASC 310-30 | Mortgages [Member]
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount	703,454	717,904
Non-covered loans accounted under ASC 310-30 | Commercial Loan [Member]
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount	532,695	545,117
Non-covered loans accounted under ASC 310-30 | Consumer Loan [Member]
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount	53,310	63,620
Non-covered loans accounted under ASC 310-30 | Auto
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount	341,889	379,145
Non-covered loans accounted under ASC 310-30 | Construction
Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]
Loans and Leases Receivable, Gross, Carrying Amount	122,693	126,427
Allowance for loan and lease losses on non-covered loans	0	0
Acquired Loans In An F D I C Assisted Transaction [Member]
Loans And Leases Receivable Net Reported Amount Covered [Abstract]
Loans And Leases Receivable Gross Carrying Amount Covered	402,263	409,690
Allowance for Covered Loan and Lease Losses, net	(54,398)	(52,729)
Acquired Loans In An F D I C Assisted Transaction [Member] | Consumer Loan [Member]
Loans And Leases Receivable Net Reported Amount Covered [Abstract]
Loans And Leases Receivable Gross Carrying Amount Covered	5,769	6,119
Acquired Loans In An F D I C Assisted Transaction [Member] | Loans Secured by 1-4 properties
Loans And Leases Receivable Net Reported Amount Covered [Abstract]
Loans And Leases Receivable Gross Carrying Amount Covered	124,239	121,748
Allowance for Covered Loan and Lease Losses, net	(14,221)	(12,495)
Acquired Loans In An F D I C Assisted Transaction [Member] | Construction and development secured by multi-family properties [Member]
Loans And Leases Receivable Net Reported Amount Covered [Abstract]
Loans And Leases Receivable Gross Carrying Amount Covered	18,254	17,304
Allowance for Covered Loan and Lease Losses, net	0	0
Acquired Loans In An F D I C Assisted Transaction [Member] | Commercial and Other Construction [Member]
Loans And Leases Receivable Net Reported Amount Covered [Abstract]
Loans And Leases Receivable Gross Carrying Amount Covered	253,804	264,249
Allowance for Covered Loan and Lease Losses, net	(39,562)	(39,619)
Acquired Loans In An F D I C Assisted Transaction [Member] | Lease Agreements [Member]
Loans And Leases Receivable Net Reported Amount Covered [Abstract]
Loans And Leases Receivable Gross Carrying Amount Covered	197	270
Allowance for Covered Loan and Lease Losses, net	$ 0	$ 0

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Business Segments (Tables)

3 Months Ended

Mar. 31, 2014

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment [Table Text Block]

Following are the results of operations and the selected financial information by operating segment as of and for the quartersendedMarch 31, 2014and 2013:

	Quarter Ended March 31, 2014
			Wealth				Total Major				Consolidated
	Banking		Management		Treasury		Segments		Eliminations		Total
	(In thousands)
Interest income	$	108,631	$	40	$	14,403	$	123,074	$	-	$	123,074
Interest expense		(7,516)		-		(12,160)		(19,676)		-		(19,676)
Net interest income		101,115		40		2,243		103,398		-		103,398
Provision for non-covered loan and lease losses		(10,062)		-		-		(10,062)		-		(10,062)
Provision for covered loan and lease losses		(1,629)		-		-		(1,629)		-		(1,629)
Non-interest income (loss)		(5,047)		6,522		3,803		5,278		-		5,278
Non-interest expenses		(53,596)		(4,779)		(3,078)		(61,453)		-		(61,453)
Intersegment revenue		544		-		-		544		(544)		-
Intersegment expenses		-		(432)		(112)		(544)		544		-
Income before income taxes	$	31,325	$	1,351	$	2,856	$	35,532	$	-	$	35,532
Total assets	$	7,351,839	$	24,345	$	1,643,569	$	9,019,753	$	(1,164,115)	$	7,855,638

	Quarter Ended March 31, 2013
			Wealth				Total Major				Consolidated
	Banking		Management		Treasury		Segments		Eliminations		Total
	(In thousands)
Interest income	$	102,068	$	86	$	12,018	$	114,172	$	-	$	114,172
Interest expense		(6,971)		(60)		(13,525)		(20,556)		-		(20,556)
Net interest income		95,097		26		(1,507)		93,616		-		93,616
Provision for non-covered loan and lease losses		(7,916)		-		-		(7,916)		-		(7,916)
Provision for covered loan and lease losses, net		(672)		-		-		(672)		-		(672)
Non-interest income(loss)		2,537		7,700		(138)		10,099		-		10,099
Non-interest expenses		(61,932)		(4,462)		(415)		(66,809)		-		(66,809)
Intersegment revenue		383		-		-		383		(383)		-
Intersegment expenses		-		(302)		(81)		(383)		383		-
Income before income taxes	$	27,497	$	2,962	$	(2,141)	$	28,318	$	-	$	28,318
Total assets	$	6,989,744	$	39,511	$	2,539,649	$	9,568,904	$	(866,353)	$	8,702,551

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Accrued Interest and Other Assets (Narratives) (Details) (USD $)	Mar. 31, 2014	Dec. 31, 2013	Dec. 18, 2012
Other assets [Line Items]
Prepaid Taxes	$ 9,000,000	$ 9,600,000
Mortgage tax credits	8,706,000	8,706,000
Repossessed auto	13,700,000	12,300,000
CoreDepositsMember | Eurobank [Member]
Other assets [Line Items]
Other Intangible Assets	7,500,000	7,800,000
Customer Relationships [Member] | BBVAPR
Other assets [Line Items]
Other Intangible Assets	$ 3,900,000	$ 4,100,000	$ 5,000,000

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Stockholders' Equity (Earnings per common share) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Earnings Per Share [Abstract]
Net income	$ 23,747	$ 21,192
Nonconvertible Preferred Stock Dividend Serie A and D	(1,628)	(1,628)
Dividends Convertible Preferred Stock	(1,837)	(1,837)
Income available to common shareholders	20,282	17,727
Effect of assumed conversion of convertible preferred stock	1,837	1,837
Income available to common sharesholders assuming conversion	$ 22,119	$ 19,564
Average common shares outstanding	45,329	45,595
Average potential common shares options	131	159
Average potential common shares convertible preferred stock	7,138	7,138

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Related Party Transactions (Tables)

3 Months Ended

Mar. 31, 2014

Related Party Transactions [Abstract]

Schedule of Related Party Transactions [Table Text Block]

The activity and balance of these loans for the quarters endedMarch 31, 2014and 2013were as follows:

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Balance at the beginning of year	$	18,963	$	3,772
New loans		-		2,435
Repayments and sales		304		(95)
Credits of persons no longer considered related parties		-		(57)
Balance at the end of year	$	19,267	$	6,055

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Loans Receivable (Non-Covered BBVA Loan carrying amounts) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Accounts Notes And Loans Receivable Line Items
Financing Receivable Acquired With Deteriorated Credit Quality	$ 2,799,336	$ 2,929,353
Non-acretable discount	563,294	579,587
Cash expected to be collected	2,236,042	2,349,766
Accretable Yield	482,001	517,553
Carrying amount, gross	$ 1,754,041	$ 1,832,213

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Allowance for Loan and Lease Losses (Allowance for Covered Loan and Lease Losses) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Allowance for Loan and Lease Losses [Roll Forward]
Balance at beginning of the period	$ 52,729	$ 54,124
Provision for covered loan and lease losses, net	1,629	672
FDIC shared-loss portion of provision for (recapture of) covered loan and lease losses, net	40	(1,822)
Balance at end of the period	$ 54,398	$ 52,974

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Segment Reporting (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Segment Reporting Information [Line Items]
Total interest income	$ 123,074	$ 114,172
Interest expense	(19,676)	(20,556)
Net interest income	103,398	93,616
Provision For Non Covered Loan And Lease Losses.	(10,062)	(7,916)
Provision for Covered Loan and Lease Losses, net	(1,629)	(672)
Total non-interest income (loss), net	5,278	10,099
Non-interest expenses	(61,453)	(66,809)
Total assets	7,855,638		8,158,015
Banking [Member]
Segment Reporting Information [Line Items]
Total interest income	108,631	102,068
Interest expense	(7,516)	(6,971)
Net interest income	101,115	95,097
Provision For Non Covered Loan And Lease Losses.	(10,062)	(7,916)
Provision for Covered Loan and Lease Losses, net	(1,629)	(672)
Total non-interest income (loss), net	(5,047)	2,537
Non-interest expenses	(53,596)	(61,932)
Intersegment revenues	544	383
Intersegment expenses	0	0
Income (loss) before Income Taxes, Parent	31,325	27,497
Total assets	7,351,839	6,989,744
Financial Services
Segment Reporting Information [Line Items]
Total interest income	40	86
Interest expense	0	(60)
Net interest income	40	26
Provision For Non Covered Loan And Lease Losses.	0	0
Provision for Covered Loan and Lease Losses, net	0	0
Total non-interest income (loss), net	6,522	7,700
Non-interest expenses	(4,779)	(4,462)
Intersegment revenues	0	0
Intersegment expenses	(432)	(302)
Income (loss) before Income Taxes, Parent	1,351	2,962
Total assets	24,345	39,511
Treasury [Member]
Segment Reporting Information [Line Items]
Total interest income	14,403	12,018
Interest expense	(12,160)	(13,525)
Net interest income	2,243	(1,507)
Provision For Non Covered Loan And Lease Losses.	0	0
Provision for Covered Loan and Lease Losses, net	0	0
Total non-interest income (loss), net	3,803	(138)
Non-interest expenses	(3,078)	(415)
Intersegment revenues	0	0
Intersegment expenses	(112)	(81)
Income (loss) before Income Taxes, Parent	2,856	(2,141)
Total assets	1,643,569	2,539,649
Major Segment [Member]
Segment Reporting Information [Line Items]
Total interest income	123,074	114,172
Interest expense	(19,676)	(20,556)
Net interest income	103,398	93,616
Provision For Non Covered Loan And Lease Losses.	(10,062)	(7,916)
Provision for Covered Loan and Lease Losses, net	(1,629)	(672)
Total non-interest income (loss), net	5,278	10,099
Non-interest expenses	(61,453)	(66,809)
Intersegment revenues	544	383
Intersegment expenses	(544)	(383)
Income (loss) before Income Taxes, Parent	35,532	28,318
Total assets	9,019,753	9,568,904
Intersegment Elimination [Member]
Segment Reporting Information [Line Items]
Total interest income	0	0
Interest expense	0	0
Net interest income	0	0
Provision For Non Covered Loan And Lease Losses.	0	0
Provision for Covered Loan and Lease Losses, net	0	0
Total non-interest income (loss), net	0	0
Non-interest expenses	0	0
Intersegment revenues	(544)	(383)
Intersegment expenses	544	383
Income (loss) before Income Taxes, Parent	0	0
Total assets	$ (1,164,115)	$ (866,353)

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Allowance for Loan and Lease Losses (Recorded Investment in loans individually evaluated for impairment) (Details) (USD $) In Thousands, unless otherwise specified					3 Months Ended	12 Months Ended	3 Months Ended	12 Months Ended	3 Months Ended	12 Months Ended	3 Months Ended	12 Months Ended	3 Months Ended	12 Months Ended	3 Months Ended	12 Months Ended			3 Months Ended	12 Months Ended	3 Months Ended	12 Months Ended		3 Months Ended	12 Months Ended	3 Months Ended	12 Months Ended	3 Months Ended	12 Months Ended	3 Months Ended	12 Months Ended
	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2013	Dec. 31, 2012	Mar. 31, 2014 Non-covered originated loans [Member]	Dec. 31, 2013 Non-covered originated loans [Member]	Mar. 31, 2014 Non Covered Loan [Member] Non-covered acquired loans accounted under ASC 310-20	Dec. 31, 2013 Non Covered Loan [Member] Non-covered acquired loans accounted under ASC 310-20	Mar. 31, 2014 Non Covered Loan [Member] Most recent acquired loans accounted under ASC 310-30	Dec. 31, 2013 Non Covered Loan [Member] Most recent acquired loans accounted under ASC 310-30	Mar. 31, 2014 Covered Loan [Member]	Dec. 31, 2013 Covered Loan [Member]	Mar. 31, 2014 Mortgage Non Covered Loan [Member] Most recent acquired loans accounted under ASC 310-30	Dec. 31, 2013 Mortgage Non Covered Loan [Member] Most recent acquired loans accounted under ASC 310-30	Mar. 31, 2014 Commercial Non-covered originated loans [Member]	Dec. 31, 2013 Commercial Non-covered originated loans [Member]	Mar. 31, 2014 Commercial Non Covered Loan [Member] Non-covered acquired loans accounted under ASC 310-20	Dec. 31, 2013 Commercial Non Covered Loan [Member] Non-covered acquired loans accounted under ASC 310-20	Mar. 31, 2014 Commercial Non Covered Loan [Member] Most recent acquired loans accounted under ASC 310-30	Dec. 31, 2013 Commercial Non Covered Loan [Member] Most recent acquired loans accounted under ASC 310-30	Mar. 31, 2014 Troubled Debt Restructuring Non-covered originated loans [Member]	Dec. 31, 2013 Troubled Debt Restructuring Non-covered originated loans [Member]	Mar. 31, 2014 Troubled Debt Restructuring Non-covered originated loans [Member] Non-covered acquired loans accounted under ASC 310-20	Mar. 31, 2014 Construction Non Covered Loan [Member] Most recent acquired loans accounted under ASC 310-30	Dec. 31, 2013 Construction Non Covered Loan [Member] Most recent acquired loans accounted under ASC 310-30	Mar. 31, 2014 Consumer Non Covered Loan [Member] Most recent acquired loans accounted under ASC 310-30	Dec. 31, 2013 Consumer Non Covered Loan [Member] Most recent acquired loans accounted under ASC 310-30	Mar. 31, 2014 Consumer Covered Loan [Member]	Dec. 31, 2013 Consumer Covered Loan [Member]	Mar. 31, 2014 Auto Non Covered Loan [Member] Most recent acquired loans accounted under ASC 310-30	Dec. 31, 2013 Auto Non Covered Loan [Member] Most recent acquired loans accounted under ASC 310-30
Impaired Financing Receivable Unpaid Principal Balance [Abstract]
Impaired Financing Receivable With Related Allowance Unpaid Principal Balance									$ 202,344	$ 527,088	$ 415,110	$ 338,257	$ 5,008	$ 5,183	$ 7,856	$ 6,600			$ 89,496	$ 48,100	$ 92,870	$ 89,539		$ 46,256	$ 21,526	$ 61,584	$ 73,043	$ 9,671	$ 10,512	$ 0	$ 379,236
Impaired Financing Receivable With No Related Allowance Unpaid Principal Balance															26,744	27,914	208	208
Total Unpaid Principal					127,470	124,053	208	208
Impaired Financing Receivable Recorded Investment [Abstract]
Impaired Financing Receivable With Related Allowance Recorded Investment									176,956	503,869	246,846	173,286	4,510	4,718	6,686	5,553			78,742	40,411	87,744	84,494		40,397	17,818	53,307	63,606	5,503	5,857	0	377,316
Impaired Financing Receivable With No Related Allowance Recorded Investment															21,081	22,592	208	208
Total Recorded Investment		208			115,511	112,639	208
Allowance for loan and lease losses, covered	$ 54,398	$ 52,729	$ 52,974	$ 54,124	$ 9,706	$ 10,139	$ 0	$ 0	$ 3,058	$ 2,863	$ 54,398	$ 52,729	$ 57	$ 57	$ 1,704	$ 1,431			$ 879	$ 394		$ 8,708	$ 8,002	$ 1,773	$ 1,319	$ 349	$ 361	$ 615	$ 615	$ 0	$ 732
Coverage					8.00%	9.00%	0.00%	0.00%	2.00%	1.00%	22.00%	30.00%	1.00%	1.00%	25.00%	26.00%			1.00%	1.00%	9.00%	10.00%		4.00%	7.00%	1.00%	1.00%	11.00%	11.00%	0.00%	0.00%

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Securities Purchased Under Agreements to Resell and Investment (Gross realize gains and losses by category) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014
Schedule of Available-for-sale Securities [Line Items]
Sale Price	$ 139,152
Book Value	134,785
Available-for-sale Securities, Gross Realized Gains	4,366
Available-for-sale Securities, Gross Realized Losses	0
Collateralized Mortgage Backed Securities [Member] | FNMA and FHLMC [Member]
Schedule of Available-for-sale Securities [Line Items]
Sale Price	115,159
Book Value	110,792
Available-for-sale Securities, Gross Realized Gains	4,366
Available-for-sale Securities, Gross Realized Losses	0
Collateralized Mortgage Backed Securities [Member] | GNMA [Member]
Schedule of Available-for-sale Securities [Line Items]
Sale Price	23,993
Book Value	23,993
Available-for-sale Securities, Gross Realized Gains	0
Available-for-sale Securities, Gross Realized Losses	$ 0

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Resticted Cash

3 Months Ended

Mar. 31, 2014

Restricted Cash And Investments Abstract

Resticted Cash Disclosure

NOTE 2–RESTRICTED CASH

The following table includes the composition of the restricted cash:

	March 31,		December 31,
	2014		2013
	(In thousands)
Deposits pledged as collateral to other financial institutions to secure:
Securities sold under agreements to repurchase	$	-	$	67,029
Derivatives		2,980		2,980
Obligations under agreement of loans sold with recourse		12,190		12,190
	$	15,170	$	82,199

The Company delivers cash as collateral to meet margin calls for some long term securities sold under agreements to repurchase. An alternative to cash delivery is entering into securities purchased under agreements to resell and use the securities collateral received as collateral to be delivered.At December 31, 2013, the possibility of entering intosecurities purchased under agreements to resell to receive securities collateral and then deliver it to counterparties securities sold under agreements to repurchase was very limited for market reasons.Therefore, at December 31, 2013, the Company had $67.0 million in cash collateral delivered. At March 31, 2014, the Company did not have cash collateral delivered.

As part of the BBVAPR Acquisition, the Company assumed a contract with FNMA which required collateral to guarantee the repurchase, if necessary, of loans sold with recourse. At March 31, 2014 and December 31, 2013, the Company delivered cash amounting to $12.2 million.

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Allowance for Loan and Lease Losses (Interest Income Recognized in loans individually evaluated for impairment) (Details) (Originated Loans [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Impaired Financing Receivable Interest Income Accrual Method [Abstract]
Total Interest Income	$ 747	$ 740
Impaired Financing Receivable Average Recorded Investment [Abstract]
Total Average Recorded Investment	114,940	124,580
Commercial Loan [Member]
Impaired Financing Receivable Interest Income Accrual Method [Abstract]
Impaired Financing Receivable With Related Allowance Interest Income Accrual Method	24	4
Impaired Financing Receivable With No Related Allowance Interest Income Accrual Method	78	293
Impaired Financing Receivable Average Recorded Investment [Abstract]
Impaired Financing Receivable With Related Allowance Average Recorded Investment	6,259	15,472
Impaired Financing Receivable With No Related Allowance Average Recorded Investment	21,629	30,360
Troubled Debt Restructuring [Member]
Impaired Financing Receivable Interest Income Accrual Method [Abstract]
Impaired Financing Receivable With Related Allowance Interest Income Accrual Method	645	443
Impaired Financing Receivable Average Recorded Investment [Abstract]
Impaired Financing Receivable With Related Allowance Average Recorded Investment	$ 87,052	$ 78,748

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Restricted Cash (Composition) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Restricted cash components by secured investment type
Deposit pledged as collateral	$ 15,170	$ 82,199
Securities sold under agreements to repurchase secured with cash or equivalents [Member]
Restricted cash components by secured investment type
Deposit pledged as collateral	0	67,029
Derivative
Restricted cash components by secured investment type
Deposit pledged as collateral	2,980	2,980
Residential Loans Sold with Recourse [Member]
Restricted cash components by secured investment type
Deposit pledged as collateral	$ 12,190	$ 12,190

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Loans (Tables)

3 Months Ended

Mar. 31, 2014

Loans And Leases Receivable Net Reported Amount Covered And Not Covered [Abstract]

Schedule Of Accounts Notes Loans And Financing Receivable Text Block

The composition of the Company's loan portfolio at March 31, 2014 and December 31,2013 was as follows

	March 31,		December 31,
	2014		2013
	(In thousands)
Loans not covered under shared-loss agreements with FDIC:
Originated and other loans and leases held for investment:
Mortgage	$	782,150	$	766,265
Commercial		1,170,145		1,127,657
Consumer		142,492		127,744
Auto and leasing		447,940		379,874
		2,542,727		2,401,540
Acquired loans:
Accounted for under ASC 310-20 (Loans with revolving feature and/or
acquired at a premium)
Commercial		71,577		77,681
Consumer		52,049		56,174
Auto		268,865		301,584
		392,491		435,439
Accounted for under ASC 310-30 (Loans acquired with deteriorated
credit quality, including those by analogy)
Mortgage		703,454		717,904
Commercial		532,695		545,117
Construction		122,693		126,427
Consumer		53,310		63,620
Auto		341,889		379,145
		1,754,041		1,832,213
		4,689,259		4,669,192
Deferred loan cost , net		2,318		1,035
Loans receivable		4,691,577		4,670,227
Allowance for loan and lease losses on non-covered loans		(56,183)		(54,298)
Loans receivable, net		4,635,394		4,615,929
Mortgage loans held-for-sale		19,355		46,529
Total loans not covered under shared-loss agreements with FDIC, net		4,654,749		4,662,458
Loans covered under shared-loss agreements with FDIC:
Loans secured by 1-4 family residential properties		124,239		121,748
Construction and development secured by 1-4 family residential properties		18,254		17,304
Commercial and other construction		253,804		264,249
Consumer		5,769		6,119
Leasing		197		270
Total loans covered under shared-loss agreements with FDIC		402,263		409,690
Allowance for loan and lease losses on covered loans		(54,398)		(52,729)
Total loans covered under shared-loss agreements with FDIC, net		347,865		356,961
Total loans, net	$	5,002,614	$	5,019,419

Past Due Financing Receivables [Table Text Block]

The following tables present the aging of the recorded investment in gross originated and other loans held for investment as of March 31,2014 and December 31, 2013 by class ofloans. Mortgage loans past due included delinquent loans in the GNMA buy-back option program. Servicers of loans underlying GNMA mortgage-backed securities must report as their own assets the defaulted loans that they have the option (but not the obligation) to repurchase, even when they elect not to exercise that option

	March 31, 2014
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Mortgage
Traditional (by origination year):
Up to the year 2002	$	5,330	$	2,620	$	2,877	$	10,827	$	61,269	$	72,096	$	91
Years 2003 and 2004		5,494		2,445		2,342		10,281		53,234		63,515		-
Year 2005		6,620		2,288		6,289		15,197		72,621		87,818		-
Year 2006		10,151		4,376		4,474		19,001		97,903		116,904		-
Years 2007, 2008 and 2009		3,807		2,025		4,850		10,682		87,158		97,840		-
Years 2010, 2011, 2012, 2013 and 2014		3,890		1,122		4,939		9,951		172,216		182,167		167
		35,292		14,876		25,771		75,939		544,401		620,340		258
Non-traditional		1,744		470		2,425		4,639		35,151		39,790		-
Loss mitigation program		8,149		6,485		12,559		27,193		58,812		86,005		2,254
		45,185		21,831		40,755		107,771		638,364		746,135		2,512
Home equity secured personal loans		-		-		138		138		595		733		-
GNMA's buy-back option program		-		-		35,282		35,282		-		35,282		-
		45,185		21,831		76,175		143,191		638,959		782,150		2,512
Commercial
Commercial secured by real estate:
Corporate		-		-		-		-		62,935		62,935		-
Institutional		-		-		-		-		9,833		9,833		-
Middle market		-		-		1,531		1,531		168,222		169,753		-
Retail		1,241		277		4,780		6,298		150,396		156,694		-
Floor plan		-		-		-		-		1,699		1,699		-
Real estate		-		-		-		-		11,837		11,837		-
		1,241		277		6,311		7,829		404,922		412,751		-
Other commercial and industrial:
Corporate		-		-		-		-		28,475		28,475		-
Institutional		-		-		-		-		553,249		553,249		-
Middle market		-		-		513		513		82,420		82,933		-
Retail		609		292		1,622		2,523		64,532		67,055		-
Floor plan		-		-		-		-		25,682		25,682		-
		609		292		2,135		3,036		754,358		757,394		-
		1,850		569		8,446		10,865		1,159,280		1,170,145		-

	March 31, 2014
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Consumer
Credit cards		263		171		354		788		14,702		15,490		-
Overdrafts		28		11		4		43		288		331		-
Personal lines of credit		60		99		57		216		1,718		1,934		-
Personal loans		1,418		524		248		2,190		105,847		108,037		-
Cash collateral personal loans		375		46		16		437		16,263		16,700		-
		2,144		851		679		3,674		138,818		142,492		-
Auto and leasing		33,788		8,559		5,872		48,219		399,721		447,940		-
Total	$	82,967	$	31,810	$	91,172	$	205,949	$	2,336,778	$	2,542,727	$	2,512

	December 31, 2013
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Mortgage
Traditional (by origination year):
Up to the year 2002	$	6,697	$	1,635	$	3,408	$	11,740	$	64,772	$	76,512	$	79
Years 2003 and 2004		4,722		2,163		1,845		8,730		56,387		65,117		-
Year 2005		8,527		2,119		4,808		15,454		74,087		89,541		-
Year 2006		12,055		4,312		4,418		20,785		99,537		120,322		-
Years 2007, 2008 and 2009		3,464		1,104		4,663		9,231		91,919		101,150		152
Years 2010, 2011, 2012 and 2013		3,923		1,609		4,453		9,985		139,561		149,546		459
		39,388		12,942		23,595		75,925		526,263		602,188		690
Non-traditional		3,217		1,162		2,311		6,690		35,412		42,102		-
Loss mitigation program		9,759		5,560		13,191		28,510		57,808		86,318		2,185
		52,364		19,664		39,097		111,125		619,483		730,608		2,875
Home equity secured personal loans		-		-		138		138		598		736		-
GNMA's buy-back option program		-		-		34,921		34,921		-		34,921		-
		52,364		19,664		74,156		146,184		620,081		766,265		2,875
Commercial
Commercial secured by real estate:
Corporate		-		-		-		-		54,796		54,796		-
Institutional		-		-		-		-		4,050		4,050		-
Middle market		1,356		-		10,294		11,650		149,933		161,583		-
Retail		4,253		1,015		3,190		8,458		158,184		166,642		-
Floor plan		-		-		-		-		1,835		1,835		-
Real estate		-		-		-		-		11,655		11,655		-
		5,609		1,015		13,484		20,108		380,453		400,561		-
Other commercial and industrial:
Corporate		236		-		-		236		32,362		32,598		-
Institutional		-		-		-		-		536,445		536,445		-
Middle market		-		299		1,134		1,433		57,464		58,897		-
Retail		1,830		552		539		2,921		58,589		61,510		-
Floor plan		39		-		-		39		37,607		37,646		-
		2,105		851		1,673		4,629		722,467		727,096		-
		7,714		1,866		15,157		24,737		1,102,920		1,127,657		-

	December 31, 2013
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Consumer
Credit cards		287		168		232		687		14,554		15,241		-
Overdrafts		46		4		-		50		322		372		-
Personal lines of credit		33		38		66		137		1,844		1,981		-
Personal loans		1,324		399		352		2,075		92,485		94,560		-
Cash collateral personal loans		324		43		-		367		15,223		15,590		-
		2,014		652		650		3,316		124,428		127,744		-
Auto and leasing		25,531		9,437		5,089		40,057		339,817		379,874		-
Total	$	87,623	$	31,619	$	95,052	$	214,294	$	2,187,246	$	2,401,540	$	2,875

The following table presents the aging of the recorded investment in gross acquired loans accounted for under ASC 310-20 as of March 31,2014 and December 31, 2013, by class ofloans:

	March 31, 2014
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Commercial
Commercial secured by real estate
Corporate	$	-	$	-	$	-	$	-	$	11,079	$	11,079	$	-
Retail		47		-		603		650		3,651		4,301		-
Floor plan		-		-		101		101		2,651		2,752		-
		47		-		704		751		17,381		18,132		-
Other commercial and industrial
Corporate		14		-		82		96		2,851		2,947		-
Institutional		-		-		-		-		221		221		-
Retail		645		128		716		1,489		15,727		17,216		-
Floor plan		84		-		126		210		32,851		33,061		-
		743		128		924		1,795		51,650		53,445		-
		790		128		1,628		2,546		69,031		71,577		-
Consumer
Credit cards		1,413		781		2,078		4,272		44,109		48,381		-
Personal loans		105		83		57		245		3,423		3,668		-
		1,518		864		2,135		4,517		47,532		52,049		-
Auto		13,161		3,522		1,342		18,025		250,840		268,865		-
Total	$	15,469	$	4,514	$	5,105	$	25,088	$	367,403	$	392,491	$	-

	December 31, 2013
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Commercial
Commercial secured by real estate
Corporate	$	-	$	-	$	-	$	-	$	10,166	$	10,166	$	-
Retail		431		331		868		1,630		4,140		5,770		-
Floor plan		-		-		101		101		2,576		2,677		-
		431		331		969		1,731		16,882		18,613		-
Other commercial and industrial
Corporate		14		83		-		97		9,696		9,793		-
Retail		1,717		1,418		659		3,794		23,544		27,338		-
Floor plan		35		193		18		246		21,691		21,937		-
		1,766		1,694		677		4,137		54,931		59,068		-
		2,197		2,025		1,646		5,868		71,813		77,681		-
Consumer
Credit cards		2,217		1,200		2,068		5,485		46,714		52,199		-
Personal loans		196		7		91		294		3,681		3,975		-
		2,413		1,207		2,159		5,779		50,395		56,174		-
Auto		12,534		3,616		1,608		17,758		283,826		301,584		-
Total	$	17,144	$	6,848	$	5,413	$	29,405	$	406,034	$	435,439	$	-

Carrying Amounts Of Acquired Non Covered Loans Tabular Disclosure [Table Text Block]

	March 31,	December 31,
	2014	2013
	(In thousands)
Contractual required payments receivable	$ 2,799,336	$ 2,929,353
Less: Non-accretable discount	563,294	579,587
Cash expected to be collected	2,236,042	2,349,766
Less: Accretable yield	482,001	517,553
Carrying amount	$ 1,754,041	$ 1,832,213

Accretable Yield for Acquired Loans Non-covered [Table Text Block]

The following tables describe the accretable yield and non-accretable discount activity of acquired loans accounted for under ASC 310-30 for the quartersended March 31, 2014 and 2013, excluding covered loans

	Quarter Ended March 31,
	2014		2013
Accretable Yield Activity
Balance at beginning of period	$	517,553	$	655,833
Accretion		(40,269)		(47,668)
Transfer from non-accretable discount		4,717		-
Balance at end of period	$	482,001	$	608,165
	Quarter Ended March 31,
	2014		2013
Non-Accretable Discount Activity
Balance at beginning of period	$	579,587	$	714,462
Principal losses		(11,576)		(8,746)
Transfer to accretable yield		(4,717)		-
Balance at end of period	$	563,294	$	705,716

Covered loans carrying amount [Table Text Block]

Covered Loans

The carrying amount of covered loans at March 31, 2014 and December 31, 2013is as follows:

	March 31,		December 31,
	2014		2013
	(In thousands)
Contractual required payments receivable	$	657,353	$	702,126
Less: Non-accretable discount		107,323		129,477
Cash expected to be collected		550,030		572,649
Less: Accretable yield		147,767		162,959
Carrying amount, gross		402,263		409,690
Less: Allowance for covered loan and lease losses		54,398		52,729
Carrying amount, net	$	347,865	$	356,961

The following tables describe the accretable yield and non-accretable discount activity of covered loans for the quartersended March 31, 2014 and2013:

Accretable Yield for Acquired Loans Covered [Table Text Block]

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Accretable yield activity
Balance at beginning of period	$	162,959	$	188,008
Accretion		(23,388)		(20,229)
Transfer from non-accretable discount		8,196		6,328
Balance at end of period	$	147,767	$	174,107
	Quarter Ended March 31,
	2014		2013
	(In thousands)
Non-accretable discount activity
Balance at beginning of period	$	129,477	$	237,555
Principal losses		(13,958)		(16,991)
Transfer to accretable yield		(8,196)		(6,328)
Balance at end of period	$	107,323	$	214,236

Financing Receivable Recorded Investment Nonaccrual Status By Class Of Loans [Table Text Block]

Non-accrual Loans

The following table presents the recorded investment in loansin non-accrual status by class ofloans as of March 31, 2014 and December 31, 2013:

	March 31,		December 31,
	2014		2013
	(In thousands)
Originated and other loans and leases held for investment
Mortgage
Traditional (by origination year):
Up to the year 2002	$	2,884	$	3,428
Years 2003 and 2004		2,359		1,845
Year 2005		6,667		4,922
Year 2006		4,555		4,418
Years 2007, 2008 and 2009		4,943		4,511
Years 2010, 2011, 2012, 2013 and 2014		8,342		7,818
		29,750		26,942
Non-traditional		2,425		2,311
Loss mitigation program		16,903		18,792
		49,078		48,045
Home equity secured personal loans		138		138
		49,216		48,183
Commercial
Commercial secured by real estate
Middle market		11,596		11,895
Retail		8,760		7,208
		20,356		19,103
Other commercial and industrial
Middle market		513		1,134
Retail		2,923		2,485
Floor plan		-		108
		3,436		3,727
		23,792		22,830
Consumer
Credit cards		354		232
Overdrafts		4		-
Personal lines of credit		161		84
Personal loans		547		485
Cash collateral personal loans		18		4
		1,084		805
Auto and leasing		6,047		5,089
	$	80,139	$	76,907

	March 31,		December 31,
	2014		2013
	(In thousands)
Acquired loans accounted under ASC 310-20
Commercial
Commercial secured by real estate
Retail	$	688	$	956
Floor plan		101		101
		789		1,057
Other commercial and industrial
Corporate		96		97
Retail		851		1,371
Floor plan		126		18
		1,073		1,486
		1,862		2,543
Consumer
Credit cards		2,076		2,068
Personal loans		58		151
		2,134		2,219
Auto		1,515		1,608
		5,511		6,370
Total non-accrual loans	$	85,650	$	83,277

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Securities Purchased Under Agreements and Investments (Tables)

3 Months Ended

Mar. 31, 2014

Investments [Abstract]

Available for sale securities

	March 31, 2014
			Gross		Gross				Weighted
	Amortized		Unrealized		Unrealized		Fair		Average
	Cost		Gains		Losses		Value		Yield
	(In thousands)
Available-for-sale
Mortgage-backed securities
FNMA and FHLMC certificates	$	1,093,717	$	31,769	$	4,690	$	1,120,796		3.03%
GNMA certificates		6,146		426		23		6,549		4.93%
CMOs issued by US Government-sponsored agencies		211,308		351		4,139		207,520		1.78%
Total mortgage-backed securities		1,311,171		32,546		8,852		1,334,865		2.84%
Investment securities
US Treasury securities		70,000		-		-		70,000		0.03%
Obligations of US Government-sponsored agencies		9,539		-		42		9,497		1.23%
Obligations of Puerto Rico Government and political subdivisions		22,367		-		5,298		17,069		5.32%
Other debt securities		24,029		225		-		24,254		3.46%
Total investment securities		125,935		225		5,340		120,820		1.72%
Total securities available for sale	$	1,437,106	$	32,771	$	14,192	$	1,455,685		2.74%

	December 31, 2013
			Gross		Gross				Weighted
	Amortized		Unrealized		Unrealized		Fair		Average
	Cost		Gains		Losses		Value		Yield
	(In thousands)
Available-for-sale
Mortgage-backed securities
FNMA and FHLMC certificates	$	1,190,910	$	33,089	$	6,669	$	1,217,330		2.93%
GNMA certificates		7,406		433		24		7,815		4.92%
CMOs issued by US Government-sponsored agencies		220,801		407		6,814		214,394		1.78%
Total mortgage-backed securities		1,419,117		33,929		13,507		1,439,539		2.76%
Investment securities
Obligations of US Government-sponsored agencies		10,691		-		42		10,649		1.21%
Obligations of Puerto Rico Government and political subdivisions		121,035		-		6,845		114,190		4.38%
Other debt securities		24,200		167		320		24,047		3.46%
Total investment securities		155,926		167		7,207		148,886		2.99%
Total securities available-for-sale	$	1,575,043	$	34,096	$	20,714	$	1,588,425		2.89%

	March 31, 2014
	Available-for-sale
	Amortized Cost		Fair Value
	(In thousands)
Mortgage-backed securities
Due after 5 to 10 years
FNMA and FHLMC certificates	$	26,294	$	26,625
Total due after 5 to 10 years		26,294		26,625
Due after 10 years
FNMA and FHLMC certificates		1,067,423		1,094,171
GNMA certificates		6,146		6,549
CMOs issued by US Government-sponsored agencies		211,308		207,520
Total due after 10 years		1,284,877		1,308,240
Total mortgage-backed securities		1,311,171		1,334,865
Investment securities
Due in less than one year
US Treasury securities		70,000		70,000
Other debt securities		20,000		20,053
Total due in less than one year		90,000		90,053
Due from 1 to 5 years
Obligations of Puerto Rico Government and political subdivisions		11,903		9,827
Total due from 1 to 5 years		11,903		9,827
Due after 5 to 10 years
Obligations of US Government and sponsored agencies		9,539		9,497
Total due after 5 to 10 years		9,539		9,497
Due after 10 years
Obligations of Puerto Rico Government and political subdivisions		10,464		7,242
Other debt securities		4,029		4,201
Total due after 10 years		14,493		11,443
Total investment securities		125,935		120,820
Total securities available-for-sale	$	1,437,106	$	1,455,685

Gross Realized Gains and Losses by Category

For the quarter ended March 31, 2014 the Company recorded a net gain on sale of securities of $4.4 million. The tables below present the gross realized gains by category for such period.There was no realized gain or loss for the quarter ended March 31, 2013.

	Quarter Ended March 31, 2014
			Book Value		Gross		Gross
Description	Sale Price		at Sale		Gains		Losses
	(In thousands)
Sale of securities available-for-sale
Mortgage-backed securities
FNMA and FHLMC certificates	$	115,159	$	110,792	$	4,366	$	-
GNMA certificates		23,993		23,993		-		-
Total	$	139,152	$	134,785	$	4,366	$	-

Available For Sale Securities Continuous Unrealized Loss Position Fair Value

The following tables show the Company's gross unrealized losses and fair value of investment securities available-for-sale, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at March 31, 2014 and December 31, 2013

	March 31, 2014
	12 months or more
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
CMOs issued by US Government-sponsored agencies	$	1,897	$	163	$	1,734
Obligations of Puerto Rico Government and political subdivisions		22,367		5,298		17,069
GNMA certificates		80		10		70
	$	24,344	$	5,471	$	18,873
	Less than 12 months
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
CMOs issued by US Government-sponsored agencies	$	177,882	$	3,976	$	173,906
FNMA and FHLMC certificates		214,926		4,690		210,236
Obligations of US government and sponsored agencies		9,539		42		9,497
GNMA certificates		121		13		108
	$	402,468	$	8,721	$	393,747
	Total
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
CMOs issued by US Government-sponsored agencies	$	179,779	$	4,139	$	175,640
FNMA and FHLMC certificates		214,926		4,690		210,236
Obligations of Puerto Rico Government and political subdivisions		22,367		5,298		17,069
Obligations of US government and sponsored agencies		9,539		42		9,497
GNMA certificates		201		23		178
	$	426,812	$	14,192	$	412,620

	December 31, 2013
	12 months or more
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
Obligations of Puerto Rico Government and political subdivisions	$	20,845	$	5,470	$	15,375
CMOs issued by US Government-sponsored agencies		2,559		237		2,322
GNMA certificates		81		11		70
	$	23,485	$	5,718	$	17,767
	Less than 12 months
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
Obligations of Puerto Rico Government and political subdivisions	$	100,190	$	1,375	$	98,815
CMOs issued by US Government-sponsored agencies		182,661		6,577		176,084
GNMA certificates		122		13		109
FNMA and FHLMC certificates		220,913		6,669		214,244
Obligations of US Government and sponsored agencies		10,691		42		10,649
Other debt securities		20,000		320		19,680
	$	534,577	$	14,996	$	519,581
	Total
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
Obligations of Puerto Rico Government and political subdivisions	$	121,035	$	6,845	$	114,190
CMOs issued by US Government-sponsored agencies		185,220		6,814		178,406
GNMA certificates		203		24		179
FNMA and FHLMC certificates		220,913		6,669		214,244
Obligations of US Government and sponsored agencies		10,691		42		10,649
Other debt securities		20,000		320		19,680
	$	558,062	$	20,714	$	537,348

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Stockholders' Equity (Reclassifications out of other comprehensive income) (Details) (Reclassification out of Accumulated Other Comprehensive Income [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Reclassification out of Accumulated Other Comprehensive Income [Member]
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]
Interest Rate Contract	$ 1,621	$ 1,336
Tax Effect Reclassified From Accumulated OCI Into Income Tax Provision	137	47
Total	$ 1,758	$ 1,383

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Loans Receivable (Investment in non-covered loans on non-accrual status) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Non Covered Loan [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	$ 85,650	$ 83,277
Non-covered originated loans [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	80,139	76,907
Non-covered originated loans [Member] | Mortgages [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	49,216	48,183
Non-covered originated loans [Member] | Traditional loan
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	29,750	26,942
Non-covered originated loans [Member] | Originated Up To The Year 2002 [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	2,884	3,428
Non-covered originated loans [Member] | Originated In The Years 2003 And 2004 [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	2,359	1,845
Non-covered originated loans [Member] | Originated In The Year 2005 [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	6,667	4,922
Non-covered originated loans [Member] | Originated In The Year 2006 [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	4,555	4,418
Non-covered originated loans [Member] | Originated In The Years 2007 2008 And 2009 [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	4,943	4,511
Non-covered originated loans [Member] | Originated In The Years 2010 2011 2012 2013 And 2014 [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	8,342	7,818
Non-covered originated loans [Member] | NonTraditional Mortgage [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	2,425	2,311
Non-covered originated loans [Member] | Loss Mitigation Program [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	16,903	18,792
Non-covered originated loans [Member] | Home equity secured personal loans [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	138	138
Non-covered originated loans [Member] | Commercial Loan [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	23,792	22,830
Non-covered originated loans [Member] | Commercial Secured [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	20,356	19,103
Non-covered originated loans [Member] | Middle Market Commercial Secured [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	11,596	11,895
Non-covered originated loans [Member] | Retail Commercial Secured [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	8,760	7,208
Non-covered originated loans [Member] | Other Commercial and Industrial[Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	3,436	3,727
Non-covered originated loans [Member] | Middle Market Other Commercial [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	513	1,134
Non-covered originated loans [Member] | Retail Other Commercial [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	2,923	2,485
Non-covered originated loans [Member] | Floor Plan Other Commercial [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	0	108
Non-covered originated loans [Member] | Consumer Loan [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	1,084	805
Non-covered originated loans [Member] | Credit Cards [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	354	232
Non-covered originated loans [Member] | Overdrafts [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	4	0
Non-covered originated loans [Member] | Unsecured personal lines of credit [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	161	84
Non-covered originated loans [Member] | Unsecured personal loans [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	547	485
Non-covered originated loans [Member] | Cash collateral personal loans [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	18	4
Non-covered originated loans [Member] | Auto and Leasing loans receivable [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	6,047	5,089
Accounted for under ASC 310-20 [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	5,511	6,370
Accounted for under ASC 310-20 [Member] | Commercial Loan [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	1,862	2,543
Accounted for under ASC 310-20 [Member] | Commercial Secured [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	789	1,057
Accounted for under ASC 310-20 [Member] | Retail Commercial Secured [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	688	956
Accounted for under ASC 310-20 [Member] | Floor Plan Commercial Secured [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	101	101
Accounted for under ASC 310-20 [Member] | Other Commercial and Industrial[Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	1,073	1,486
Accounted for under ASC 310-20 [Member] | Corporate Other Commercial [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	96	97
Accounted for under ASC 310-20 [Member] | Retail Other Commercial [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	851	1,371
Accounted for under ASC 310-20 [Member] | Floor Plan Other Commercial [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	126	18
Accounted for under ASC 310-20 [Member] | Consumer Loan [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	2,134	2,219
Accounted for under ASC 310-20 [Member] | Credit Cards [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	2,076	2,068
Accounted for under ASC 310-20 [Member] | Unsecured personal loans [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	58	151
Accounted for under ASC 310-20 [Member] | Auto and Leasing loans receivable [Member]
Financing Receivable, Recorded Investment [Line Items]
Financing Receivable, Recorded Investment, Nonaccrual Status	$ 1,515	$ 1,608

XML

Securities Purchased Under Agreements to Resell and Investment (Narrative) (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Investments, Debt and Equity Securities [Abstract]
Fair value of securities held as collateral		$ 64.6
Puerto Rico Government obligation with mandatory tender offer	98.7
Investments Guaranteed by US Treasury and Sponsored Agencies in Unrealized Loss on Position	404.4
Investments Guaranteed by Puerto Rico Government and its Political Subdivisions in Unrealized Loss On Position	$ 22.4
Investments Guaranteed By Us Treasury And Sponsored Agencies in Unrealized Loss Position Percentage To Total Investment in Unrealized Loss Position	95.00%
Investments Guaranteed By Puerto Rico Government and Its Political Subdivisions in Unrealized Loss Position Percentage To Total Investment in Unrealized Loss Position	5.00%

XML

Allowance for Loan and Lease Losses (Tables)

3 Months Ended

Mar. 31, 2014

Loans Receivable [Abstract]

Allowance for Credit Losses on Financing Receivables [Table Text Block]

The composition of the Company's allowance for loan and lease losses at March 31, 2014 and December 31, 2013 was as follows:

	March 31,		December 31,
	2014		2013
	(In thousands)
Allowance for loans and lease losses on non-covered loans:
Originated and other loans and leases held for investment:
Mortgage	$	19,511	$	19,937
Commercial		13,994		14,897
Consumer		7,135		6,006
Auto and leasing		8,731		7,866
Unallocated		136		375
		49,507		49,081
Acquired loans:
Accounted for under ASC 310-20 (Loans with revolving feature and/or
acquired at a premium)
Commercial		867		926
Consumer		504		-
Auto		2,247		1,428
		3,618		2,354
Accounted for under ASC 310-30 (Loans acquired with deteriorated
credit quality, including those by analogy)
Commercial		2,653		1,713
Consumer		405		418
Auto		-		732
		3,058		2,863
		56,183		54,298
Allowance for loans and lease losses on covered loans:
Loans secured by 1-4 family residential properties		14,221		12,495
Commercial and other construction		39,562		39,619
Consumer		615		615
		54,398		52,729
Total allowance for loan and lease losses	$	110,581	$	107,027

The following tables present the activity in our allowance for loan and lease losses and the related recorded investment of the associatedloans for our originated and other loans held for investment portfolio by segment for the periods indicated:

	Quarter Ended March 31, 2014
							Auto and
	Mortgage		Commercial		Consumer		Leasing		Unallocated		Total
	(In thousands)
Allowance for loan and lease losses for non-covered originated and other loans:
Balance at beginning of period	$	19,937	$	14,897	$	6,006	$	7,866	$	375	$	49,081
Charge-offs		(1,214)		(419)		(838)		(4,645)		-		(7,116)
Recoveries		148		98		147		1,524		-		1,917
Provision for non-covered originated and other loan and lease losses		640		(582)		1,820		3,986		(239)		5,625
Balance at end of period	$	19,511	$	13,994	$	7,135	$	8,731	$	136	$	49,507

	March 31, 2014
	Mortgage		Commercial		Consumer		Auto and Leasing		Unallocated		Total
	(In thousands)
Allowance for loan and lease losses on non-covered originated and other loans:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	8,001	$	1,704	$	-	$	-	$	-	$	9,705
Collectively evaluated for impairment		11,510		12,290		7,135		8,731		136		39,802
Total ending allowance balance	$	19,511	$	13,994	$	7,135	$	8,731	$	136	$	49,507
Loans:
Individually evaluated for impairment	$	87,744	$	27,767	$	-	$	-	$	-	$	115,511
Collectively evaluated for impairment		694,406		1,142,378		142,492		447,940		-		2,427,216
Total ending loan balance	$	782,150	$	1,170,145	$	142,492	$	447,940	$	-	$	2,542,727

	Quarter Ended March 31, 2013
	Mortgage		Commercial		Consumer		Auto and Leasing		Unallocated		Total
	(In thousands)
Allowance for loan and lease losses for non-covered originated and other loans:
Balance at beginning of period	$	21,092	$	17,072	$	856	$	533	$	368	$	39,921
Charge-offs		(2,588)		(557)		(246)		(91)		-		(3,482)
Recoveries		-		28		65		7		-		100
Provision for (recapture of) non-covered originated and other loan and lease losses		4,385		(229)		638		1,292		(291)		5,795
Balance at end of period	$	22,889	$	16,314	$	1,313	$	1,741	$	77	$	42,334

	December 31, 2013
	Mortgage		Commercial		Consumer		Auto and Leasing		Unallocated		Total
	(In thousands)
Allowance for loan and lease losses for non-covered originated and other loans:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	8,708	$	1,431	$	-	$	-	$	-	$	10,139
Collectively evaluated for impairment		11,229		13,466		6,006		7,866		375		38,942
Total ending allowance balance	$	19,937	$	14,897	$	6,006	$	7,866	$	375	$	49,081
Loans:
Individually evaluated for impairment	$	84,494	$	28,145	$	-	$	-	$	-	$	112,639
Collectively evaluated for impairment		681,771		1,099,512		127,744		379,874		-		2,288,901
Total ending loans balance	$	766,265	$	1,127,657	$	127,744	$	379,874	$	-	$	2,401,540

The following tables present the activity in our allowance for loan losses and related recorded investment of the associated loans in our non-covered acquiredloan portfolio, excluding loans accounted for under ASC 310-30, for the quarterended March 31, 2014

	Quarter Ended March 31, 2014
	Commercial			Consumer		Auto		Unallocated		Total
Allowance for loan and lease losses for non-covered acquired loans accounted for under ASC 310-20:
Balance at beginning of period	$	926	$ 1	$	-	$	1,428	$	-	$	2,354
Charge-offs		(174)			(2,058)		(1,296)		-		(3,528)
Recoveries		-			100		450		-		550
Provision for non-covered acquired loan and lease losses accounted for under ASC 310-20		115			2,462		1,665		-		4,242
Balance at end of period	$	867		$	504	$	2,247	$	-	$	3,618

	March 31, 2014
	Commercial		Consumer		Auto		Unallocated		Total
Allowance for loan and lease losses on non-covered acquired loans accounted for under ASC 310-20:
Ending allowance balance attributable to loans:
Collectively evaluated for impairment		867		504		2,247		-		3,618
Total ending allowance balance	$	867	$	504	$	2,247	$	-	$	3,618
Loans:
Collectively evaluated for impairment		71,577		52,049		268,865		-		392,491
Total ending loan balance	$	71,577	$	52,049	$	268,865	$	-	$	392,491

	Quarter Ended March 31, 2013
	Commercial			Consumer		Auto		Unallocated		Total
Allowance for loan and lease losses for non-covered acquired loans accounted for under ASC 310-20:
Balance at beginning of period	$	-	$ 1	$	-	$	-	$	-	$	-
Charge-offs		-			(1,456)		(1,715)		-		(3,171)
Recoveries		-			207		1,230		-		1,437
Provision for non-covered acquired loan and lease losses accounted for under ASC 310-20		386			1,249		485		-		2,120
Balance at end of period	$	386		$	-	$	-	$	-	$	386

	December 31, 2013
	Commercial		Consumer		Auto		Unallocated		Total
Allowance for loan and lease losses on non-covered acquired loans accounted for under ASC 310-20:
Ending allowance balance attributable to loans:
Collectively evaluated for impairment		926		-		1,428		-		2,354
Total ending allowance balance	$	926	$	-	$	1,428	$	-	$	2,354
Loans:
Collectively evaluated for impairment		77,681		56,174		301,584		-		435,439
Total ending loan balance	$	77,681	$	56,174	$	301,584	$	-	$	435,439

The following tables present the activity in our allowance for loan losses and related recorded investment of the associated loans in our non-covered acquiredloan portfolio accounted for under ASC 310-30, for the quarterended March 31, 2014:

	Quarter Ended March 31, 2014
	Mortgage			Commercial			Construction			Consumer		Auto		Total
Allowance for loan and lease losses for non-covered loans accounted for under ASC 310-30:
Balance at beginning of period	$	-	$ 1	$	1,713	$ 1	$	-	$ 1	$	418	$	732	$	2,863
Provision for non-covered acquired loan and lease losses accounted for under ASC 310-30		-			940			-			(13)		(732)		195
Balance at end of period	$	-		$	2,653		$	-		$	405	$	-	$	3,058

Impaired Financing Receivables [Table Text Block]

The Company's recorded investment in commercial and mortgage loans that were individually evaluated forimpairment, excluding loans accounted for under ASC 310-30, and the related allowance for loan and lease losses at March 31, 2014 and December 31, 2013are as follows:

Originated and Other Loans and Leases Held for Investment

	March 31, 2014
	Unpaid		Recorded		Related
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired loans with specific allowance:
Commercial	$	7,856	$	6,686	$	1,704	25%
Residential troubled-debt restructuring		92,870		87,744		8,002	9%
Impaired loans with no specific allowance:
Commercial		26,744		21,081		N/A	N/A
Total investment in impaired loans	$	127,470	$	115,511	$	9,706	8%

	December 31, 2013
	Unpaid		Recorded		Related
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired loans with specific allowance
Commercial	$	6,600	$	5,553	$	1,431	26%
Residential troubled-debt restructuring		89,539		84,494		8,708	10%
Impaired loans with no specific allowance
Commercial		27,914		22,592		N/A	N/A
Total investment in impaired loans	$	124,053	$	112,639	$	10,139	9%

Acquired Loans Accounted for under ASC-310-20 (Loans with revolving feature and/or acquired at a premium)
	March 31, 2014
	Unpaid		Recorded		Related
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired loans with no specific allowance
Commercial		208		208		N/A	N/A
Total investment in impaired loans	$	208	$	208	$	-	0%
	December 31, 2013
	Unpaid		Recorded		Specific
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired loans with no specific allowance
Commercial		208		208		N/A	N/A
Total investment in impaired loans	$	208	$	208	$	-	0%

The Company's recorded investment in non-covered acquired loan pools accounted for under ASC 310-30 and their related allowance for non-covered loan and lease losses at March 31, 2014 and December 31, 2013are as follows

Acquired Loans Accounted for under ASC 310-30 (including those accounted for under ASC 310-30 by analogy

	March 31, 2014
	Unpaid		Recorded
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired non-covered loan pools:
Mortgage	$	5,008	$	4,510	$	57	1%
Commercial		89,496		78,742		879	1%
Construction		46,256		40,397		1,773	4%
Consumer		61,584		53,307		349	1%
Total investment in impaired non-covered loan pools	$	202,344	$	176,956	$	3,058	2%

	December 31, 2013
	Unpaid		Recorded
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired non-covered loan pools:
Mortgage	$	5,183	$	4,718	$	57	1%
Commercial		48,100		40,411		394	1%
Construction		21,526		17,818		1,319	7%
Consumer		73,043		63,606		361	1%
Auto		379,236		377,316		732	0%
Total investment in impaired non-covered loan pools	$	527,088	$	503,869	$	2,863	1%

The following table presents the interest recognized in commercial and mortgage loans that were individuallyevaluated for impairment, excluding loans accounted for under ASC 310-30, for the quartersended March 31, 2014 and 2013

	Quarter Ended March 31,
	2014				2013
	Interest Income Recognized		Average Recorded Investment		Interest Income Recognized		Average Recorded Investment
	(In thousands)
Impaired loans with specific allowance
Commercial	$	24	$	6,259	$	4	$	15,472
Residential troubled-debt restructuring		645		87,052		443		78,748
Impaired loans with no specific allowance
Commercial		78		21,629		293		30,360
Total interest income from impaired loans	$	747	$	114,940	$	740	$	124,580

Troubled Debt Restructurings on Financing Receivables [Table Text Block]

Modifications

The following table presents the troubled-debt restructurings during the quarters ended March 31, 2014 and 2013:

	Quarter Ended March 31, 2014
	Number of contracts	Pre-Modification Outstanding Recorded Investment		Pre-Modification Weighted Average Rate	Pre-Modification Weighted Average Term (in Months)	Post-Modification Outstanding Recorded Investment		Post-Modification Weighted Average Rate	Post-Modification Weighted Average Term (in Months)
	(Dollars in thousands)
Mortgage	34	$	4,009	6.43%	347	$	3,910	4.35%	375
Consumer	5		42	12.97%	67		44	12.95%	66
	Quarter Ended March 31, 2013
	Number of contracts	Pre- Modification Outstanding Recorded Investment		Pre-Modification Weighted Average Rate	Pre-Modification Weighted Average Term (in Months)	Post-Modification Outstanding Recorded Investment		Post-Modification Weighted Average Rate	Post-Modification Weighted Average Term (in Months)
	(Dollars in thousands)
Mortgage	57	$	7,518	6.28%	331	$	8,040	4.35%	409

The following table presents troubled-debt restructurings for which there was a payment default during the twelve-month period endedMarch 31, 2014 and 2013:

	Twelve-Month Period Ended March 31,
	2014			2013
	Number of Contracts	Recorded Investment		Number of Contracts	Recorded Investment
	(Dollars in thousands)
Mortgage	19	$	2,592	32	$	4,295
Commercial	-	$	-	1	$	18
Consumer	1	$	11	-	$	-

Financing Receivable Credit Quality Indicators [Table Text Block]

As of March 31,2014 and December 31, 2013, and based on the most recent analysis performed, the risk category of gross non-covered originated and other loans and acquiredloans accounted for under ASC 310-20 subject to risk rating by class of loans is as follows:

	March 31, 2014
	Risk Ratings
											Individually
	Balance				Special						Measured for
	Outstanding		Pass		Mention		Substandard		Doubtful		Impairment
	(In thousands)
Commercial - originated and other loans held for investment
Commercial secured by real estate:
Corporate	$	62,935	$	62,935	$	-	$	-	$	-	$	-
Institutional		9,833		9,833		-		-		-		-
Middle market		169,753		141,537		16,619		-		-		11,597
Retail		156,694		139,971		1,929		1,892		-		12,902
Floor plan		1,699		1,699		-		-		-		-
Real estate		11,837		11,837		-		-		-		-
		412,751		367,812		18,548		1,892		-		24,499
Other commercial and industrial:
Corporate		28,475		28,475		-		-		-		-
Institutional		553,249		553,249		-		-		-		-
Middle market		82,933		77,566		3,336		771		-		1,260
Retail		67,055		63,366		119		1,562		-		2,008
Floor plan		25,682		25,372		202		108		-		-
		757,394		748,028		3,657		2,441		-		3,268
Total		1,170,145		1,115,840		22,205		4,333		-		27,767
Commercial - acquired loans (under ASC 310-20)
Commercial secured by real estate:
Corporate		11,079		11,079		-		-		-		-
Retail		4,301		3,490		245		566		-		-
Floor plan		2,752		2,651		-		101		-		-
		18,132		17,220		245		667		-		-
Other commercial and industrial:
Corporate		2,947		2,851		-		96		-		-
Institutional		221		221		-		-		-		-
Retail		17,216		16,460		100		656		-		-
Floor plan		33,061		32,998		63		-		-		-
		53,445		52,530		163		752		-		-
Total		71,577		69,750		408		1,419		-		-
Total	$	1,241,722	$	1,185,590	$	22,613	$	5,752	$	-	$	27,767

	December 31, 2013
	Risk Ratings
											Individually
	Balance				Special						Measured for
	Outstanding		Pass		Mention		Substandard		Doubtful		Impairment
	(In thousands)
Commercial - originated and other loans held for investment
Commercial secured by real estate:
Corporate	$	54,796	$	54,796	$	-	$	-	$	-	$	-
Institutional		4,050		4,050		-		-		-		-
Middle market		161,583		133,061		16,627		118		-		11,777
Retail		166,642		149,018		2,182		2,258		-		13,184
Floor plan		1,835		1,835		-		-		-		-
Real estate		11,655		11,655		-		-		-		-
		400,561		354,415		18,809		2,376		-		24,961
Other commercial and industrial:
Corporate		32,598		32,598		-		-		-		-
Institutional		536,445		536,445		-		-		-		-
Middle market		58,897		53,868		3,466		198		-		1,365
Retail		61,510		58,742		257		691		-		1,820
Floor plan		37,646		37,350		188		108		-		-
		727,096		719,003		3,911		997		-		3,185
Total		1,127,657		1,073,418		22,720		3,373		-		28,146
Commercial - acquired loans (under ASC 310-20)
Commercial secured by real estate:
Corporate		10,166		10,166		-		-		-		-
Retail		5,770		4,378		443		949		-		-
Floor plan		2,677		2,576		-		101		-		-
		18,613		17,120		443		1,050		-		-
Other commercial and industrial:
Corporate		9,793		9,696		-		97		-		-
Retail		27,338		26,044		150		1,144		-		-
Floor plan		21,937		21,769		168		-		-		-
		59,068		57,509		318		1,241		-		-
Total		77,681		74,629		761		2,291		-		-
Total	$	1,205,338	$	1,148,047	$	23,481	$	5,664	$	-	$	28,146

	March 31, 2014
	Delinquency
																Individually
	Balance															Measured for
	Outstanding		0-29 days		30-59 days		60-89 days			90-119 days		120-364 days		365+ days		Impairment
	(In thousands)
Originated and other loans and leases held for investment
Mortgage
Traditional (by origination year)
Up to the year 2002	$	72,096	$	61,268	$	5,230	$	2,621		$	382	$	1,037	$	1,459	$	99
Years 2003 and 2004		63,515		53,170		5,494		2,445			484		1,246		612		64
Year 2005		87,818		72,414		6,448		2,288			1,233		3,576		1,324		535
Year 2006		116,904		97,822		10,151		4,376			1,169		2,410		850		126
Years 2007, 2008 and 2009		97,840		87,065		3,807		2,025			223		3,619		875		226
Years 2010, 2011, 2012 2013 and 2014		182,167		164,134		2,126		721			1,070		1,004		1,064		12,048
		620,340		535,873		33,256		14,476			4,561		12,892		6,184		13,098
Non-traditional		39,790		35,078		1,744		470			-		1,439		986		73
Loss mitigation program		86,005		8,366		1,001		171			219		779		896		74,573
		746,135		579,317		36,001		15,117			4,780		15,110		8,066		87,744
Home equity secured personal loans		733		595		-		-	-		-		126		12		-
GNMA's buy-back option program		35,282		-		-		-	-		5,529		16,742		13,011		-
		782,150		579,912		36,001		15,117			10,309		31,978		21,089		87,744
Consumer
Credit cards		15,490		14,701		263		171			136		219		-		-
Overdrafts		331		289		28		11			1		2		-		-
Unsecured personal lines of credit		1,934		1,718		60		99			15		35		7		-
Unsecured personal loans		108,037		105,369		1,397		512			195		42		12		510
Cash collateral personal loans		16,700		16,263		375		46			13		3		-		-
		142,492		138,340		2,123		839			360		301		19		510
Auto and Leasing		447,940		399,721		33,788		8,559			3,461		2,411		-		-
		1,372,582		1,117,973		71,912		24,515			14,130		34,690		21,108		88,254
Acquired loans (accounted for under ASC 310-20)
Consumer
Credit cards		48,381		44,111		1,413		781			743		1,333		-		-
Personal loans		3,668		3,423		105		83			4		53		-		-
		52,049		47,534		1,518		864			747		1,386		-		-
Auto		268,865		250,840		13,161		3,522			804		538		-		-
		320,914		298,374		14,679		4,386			1,551		1,924		-		-
Total	$	1,693,496	$	1,416,347	$	86,591	$	28,901		$	15,681	$	36,614	$	21,108	$	88,254

	December 31, 2013
	Delinquency
																Individually
	Balance															Measured for
	Outstanding		0-29 days		30-59 days		60-89 days			90-119 days		120-364 days		365+ days		Impairment
	(In thousands)
Originated and other loans and leases held for investment
Mortgage
Traditional (by origination year)
Up to the year 2002	$	76,512	$	64,743	$	6,594	$	1,634		$	868	$	1,082	$	1,458	$	133
Years 2003 and 2004		65,117		56,283		4,722		1,938			56		1,437		352		329
Year 2005		89,541		74,016		8,414		2,119			1,198		3,037		573		184
Year 2006		120,322		99,243		12,055		4,312			1,148		2,755		515		294
Years 2007, 2008 and 2009		101,150		91,920		3,464		1,104			1,264		2,844		554		-
Years 2010, 2011, 2012 and 2013		149,546		134,577		3,192		1,609			115		974		989		8,090
		602,188		520,782		38,441		12,716			4,649		12,129		4,441		9,030
Non-traditional		42,102		35,168		3,217		1,162			-		1,324		833		398
Loss mitigation program		86,318		7,762		1,376		149			624		312		1,029		75,066
		730,608		563,712		43,034		14,027			5,273		13,765		6,303		84,494
Home equity secured personal loans		736		598		-		-	-		-		126		12		-
GNMA's buy-back option program		34,921		-		-		-	-		7,670		14,425		12,826		-
		766,265		564,310		43,034		14,027			12,943		28,316		19,141		84,494
Consumer
Credit cards		15,241		14,555		287		168			118		113		-		-
Overdrafts		372		322		46		4			-		-		-		-
Unsecured personal lines of credit		1,981		1,844		33		38			25		34		7		-
Unsecured personal loans		94,560		92,102		1,272		399			300		39		13		435
Cash collateral personal loans		15,590		15,223		324		43			-		-		-		-
		127,744		124,046		1,962		652			443		186		20		435
Auto and Leasing		379,874		339,817		25,532		9,437			3,397		1,691		-		-
		1,273,883		1,028,173		70,528		24,116			16,783		30,193		19,161		84,929
Acquired loans (accounted for under ASC 310-20)
Consumer
Credit cards		52,199		46,713		2,217		1,200			828		1,241		-		-
Personal loans		3,975		3,681		196		7			60		31		-		-
		56,174		50,394		2,413		1,207			888		1,272		-		-
Auto		301,584		283,825		12,534		3,616			1,095		514		-		-
		357,758		334,219		14,947		4,823			1,983		1,786		-		-
Total	$	1,631,641	$	1,362,392	$	85,475	$	28,939		$	18,766	$	31,979	$	19,161	$	84,929

Allowance For Credit Losses On Financing Receivables Covered Loans [Table Text Block]

The changes in the allowance for loan and lease losses on covered loans for the quartersended March 31, 2014and 2013 were as follows:

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Balance at beginning of the period	$	52,729	$	54,124
Provision for covered loan and lease losses, net		1,629		672
FDIC shared-loss portion of provision for (recapture of)
covered loan and lease losses, net		40		(1,822)
Balance at end of the period	$	54,398	$	52,974

Impaired Financing Receivables Covered Loans[Table Text Block]

The Company's recorded investment in covered loan pools that have recorded impairments and their relatedallowance for covered loan and lease losses as of March 31, 2014 and December 31, 2013 are as follows

	March 31, 2014
	Unpaid		Recorded
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired covered loan pools:
Loans secured by 1-4 family residential properties	$	147,597	$	111,410	$	14,221	13%
Construction and development secured by 1-4 family residential properties		65,747		18,254		6,866	38%
Commercial and other construction		192,095		111,679		32,696	29%
Consumer		9,671		5,503		615	11%
Total investment in impaired covered loan pools	$	415,110	$	246,846	$	54,398	22%

	December 31, 2013
	Unpaid		Recorded		Specific
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired covered loan pools with specific allowance
Loans secured by 1-4 family residential properties	$	52,142	$	38,179	$	12,495	33%
Construction and development secured by 1-4 family residential properties		66,037		17,304		6,866	40%
Commercial and other construction		209,566		111,946		32,753	29%
Consumer		10,512		5,857		615	11%
Total investment in impaired covered loan pools	$	338,257	$	173,286	$	52,729	30%

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FDIC Loss Share Asset and True-up Payment Obligation (Tables)

3 Months Ended

Mar. 31, 2014

Banking and Thrift [Abstract]

FDIC Indemnification Asset Roll Forward [Table Text Block]

The following table presents the activity in the FDIC loss share assetand true-up payment obligation for the quarters ended March 31, 2014 and 2013:

	Quarter Ended March 31,
	2014		2013
	(In thousands)
FDIC share-loss indemnification asset:
Balance at beginning of period	$	189,240	$	302,295
Shared-loss agreements reimbursements from the FDIC		(8,236)		(6,650)
Increase (decrease) in expected credit losses to be covered under shared-loss agreements, net		40		(1,822)
FDIC shared-loss expense		(17,622)		(12,201)
Incurred expenses to be reimbursed under shared-loss agreements		2,772		1,502
Balance at end of period	$	166,194	$	283,124
True-up payment obligation:
Balance at beginning of period	$	18,510	$	15,496
FDIC shared-loss expense		865		670
Balance at end of period	$	19,375	$	16,166

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Basis of Presentation

3 Months Ended

Mar. 31, 2014

Nature of Operations and Summary of Significanrt Accounting Policies

Nature Of Operations

NOTE 1 –ORGANIZATION, CONSOLIDATION AND BASIS OF PRESENTATION

Nature of Operations

OFG Bancorp (the “Company”) is a publicly-owned financial holding company incorporated under the laws of the Commonwealth of Puerto Rico. The Companyoperates through various subsidiaries including, a commercial bank, Oriental Bank (or the “Bank”), a securities broker-dealer, Oriental Financial Services Corp. (“Oriental Financial Services”), an insurance agency, Oriental Insurance, Inc. (“Oriental Insurance”) and a retirement plan administrator, Caribbean Pension Consultants, Inc. (“CPC”). The Company also has a special purpose entity, Oriental Financial (PR) Statutory Trust II (the “Statutory Trust II”). Through these subsidiaries and their respective divisions, the Company provides a wide range of banking and financial services such as commercial, consumer and mortgage lending, leasing, auto loans,financial planning, insurance sales, money management and investment banking and brokerage services, as well as corporate and individual trust services.On April 25, 2013, the Company changed its corporate name from Oriental Financial Group Inc. to OFG Bancorp.

On April 30, 2010, the Bank acquired certain assets and assumed certain deposits and other liabilities in the FDIC-assisted acquisition of Eurobank. On December 18, 2012, the Company purchased Banco Bilbao VizcayaArgentaria Puerto Rico (“BBVAPR”),referred to as the “BBVAPR Acquisition.”

Significant Accounting Policies

Recent Accounting Developments

Reclassification of Defaulted Consumer Mortgage Loans upon Foreclosure - In January 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-04, Receivables—Troubled Debt Restructurings by Creditors (Subtopic 310-40): Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure. This ASU clarifies when an in-substance repossession or foreclosure occurs that would require a transfer of the mortgage loan to other real estate owned (OREO). Under the ASU, repossession or foreclosure is deemed to have occurred when (1) the creditor obtains legal title to the residential real estate property or (2) the borrower conveys all interest in the residential real estate property to the creditor to satisfy the mortgage loan through completion of a deed in lieu of foreclosure or a similar legal agreement. The ASU will become effective for annual and interim periods beginning after December 15, 2014. The ASU can be adopted using either a modified retrospective method or a prospective transition method with the cumulative effect being recognized in the beginning retained earnings of the earliest annual period for which the ASU is adopted. The adoption of this guidance will not have a material effect on our consolidated financial statements, since the Company already follows the same basis approach.

Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carry-forward, a Similar Tax Loss, or a Tax Credit Carry-forward ExistsIn July 2013, FASB issued ASU No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carry-forward, a Similar Tax Loss, or a Tax Credit Carry-forward Exists (a consensus of the FASB Emerging Issues Task, which requires that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. When a net operating loss, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional taxes that would result from the disallowance of a tax position, or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purposes, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The assessment of whether a deferred tax asset is available is based on the unrecognized tax benefit and deferred tax asset that exist at the reporting date and should be made presuming disallowance of the tax position at the reporting date. Currently, there is no explicit guidance under U.S. GAAP on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The amendment of this guidance does not require new recurring disclosures. ASU 2013-11 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. Early adoption is permitted. The amendments of this ASU should be applied prospectively to all unrecognized tax benefits that exist at the effective date. Retrospective application is permitted. The adoption of this guidance did not have a material effect on our consolidated financial statements, since the Company already followed the same basis approach.

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Derivative Activities (Tables)

3 Months Ended

Mar. 31, 2014

Derivative Instrument Detail [Abstract]

Schedule Of Derivative Instruments Text Block

The following table details “Derivative Assets” and “Derivative Liabilities” as reflected in the unauditedconsolidatedstatements of financial condition at March 31, 2014 and December 31, 2013:

	March 31,		December 31,
	2014		2013
	(In thousands)
Derivative assets:
Options tied to S&P 500 Index	$	12,555	$	16,430
Interest rate swaps designated as cash flow hedges		166		850
Interest rate swaps not designated as hedges		2,755		2,861
Interest rate caps		374		319
Other		11		42
	$	15,861	$	20,502
Derivative liabilities:
Interest rate swaps designated as cash flow hedges		10,695		11,757
Interest rate swaps not designated as hedges		2,755		2,861
Interest rate caps		374		319
Other		6		-
	$	13,830	$	14,937

The following table shows a summary of these swaps and their terms at March 31, 2014:

	Notional		Fixed	Variable	Trade	Settlement	Maturity
Type	Amount		Rate	Rate Index	Date	Date	Date
	(In thousands)
Interest Rate Swaps	$	25,000	2.4365%	1-Month LIBOR	05/05/11	05/04/12	05/04/16
		25,000	2.6200%	1-Month LIBOR	05/05/11	07/24/12	07/24/16
		25,000	2.6350%	1-Month LIBOR	05/05/11	07/30/12	07/30/16
		50,000	2.6590%	1-Month LIBOR	05/05/11	08/10/12	08/10/16
		100,000	2.6750%	1-Month LIBOR	05/05/11	08/16/12	08/16/16
		40,277	2.4210%	1-Month LIBOR	07/03/13	07/03/13	08/01/23
	$	265,277

	Notional		Fixed	Variable	Settlement	Maturity
Type	Amount		Rate	Rate Index	Date	Date
	(In thousands)
Interest Rate Swaps - Derivatives Offered to Clients	$	4,094	5.1300%	1-Month LIBOR	07/03/06	07/03/16
		12,500	5.5050%	1-Month LIBOR	04/11/09	04/11/19
	$	16,594
Interest Rate Swaps - Mirror Image Derivatives	$	4,094	5.1300%	1-Month LIBOR	07/03/06	07/03/16
		12,500	5.5050%	1-Month LIBOR	04/11/09	04/11/19
	$	16,594

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Borrowings (Securities Sold Under Agreement to Repurchase by Counterparties) (Details) (Securities Sold under Agreements to Repurchase [Member], USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Debt Instrument [Line Items]
Borrowed fund	$ 1,010,000	$ 1,265,000
Fair Value of Underlying Collateral	1,133,922	1,409,535
Jp Morgan Chase Bank Na [Member]
Debt Instrument [Line Items]
Borrowed fund	255,000	255,000
Fair Value of Underlying Collateral	273,834	273,250
Credit Suisse Securities LLC [Member]
Debt Instrument [Line Items]
Borrowed fund	755,000	755,000
Fair Value of Underlying Collateral	860,088	864,232
Deutsche Bank [Member]
Debt Instrument [Line Items]
Borrowed fund	0	255,000
Fair Value of Underlying Collateral	$ 0	$ 272,053

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Commitments and Contingencies (Tables)

3 Months Ended

Mar. 31, 2014

Commitments and Contingencies [Abstract]

Schedule Of Fair Value Off Balance Sheet Risks Text Block

	March 31,		December 31,
	2014		2013
	(In thousands)
Commitments to extend credit	$	494,327	$	520,269
Commercial letters of credit		1,740		1,096

	March 31,		December 31,
	2014		2013
	(In thousands)
Standby letters of credit and financial guarantees	$	38,875	$	38,577
Loans sold with recourse		118,163		122,291
Commitments to sell or securitize mortgage loans		34,220		99,307

Operating Leases, Future Minimum Payments Due [Abstract]

Contractual Obligation Fiscal Year Maturity Schedule [Table Text Block]

Quarter Ending March 31,	Minimum Rent
	(In thousands)
2014	$	6,170
2015		8,013
2016		7,388
2017		6,761
2018		5,864
Thereafter		22,004
	$	56,200

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Loans Receivable (Covered Loan carrying amounts) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Accounts Notes And Loans Receivable Line Items
Financing Receivable Acquired With Deteriorated Credit Quality	$ 2,799,336	$ 2,929,353
Non-acretable discount	563,294	579,587
Cash expected to be collected	2,236,042	2,349,766
Accretable Yield	482,001	517,553
Carrying amount, gross	1,754,041	1,832,213
Acquired Loans In An F D I C Assisted Transaction [Member]
Accounts Notes And Loans Receivable Line Items
Financing Receivable Acquired With Deteriorated Credit Quality	657,353	702,126
Non-acretable discount	107,323	129,477
Cash expected to be collected	550,030	572,649
Accretable Yield	147,767	162,959
Carrying amount, gross	402,263	409,690
Allowance for loan and lease losses	54,398	52,729
Carrying amount, net	$ 347,865	$ 356,961

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Derivative Activities (Derivative Assets and Liabilities) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Derivative Assets Liabilities At Fair Value Net [Line Items]
Derivative Assets	$ 15,861	$ 20,502
Derivative Liabilities	13,830	14,937
Options tied to Standard & Poor 500 Stock Market Index [Member]
Derivative Assets Liabilities At Fair Value Net [Line Items]
Derivative Assets	12,555	16,430
Designated as Hedging Instrument [Member]
Derivative Assets Liabilities At Fair Value Net [Line Items]
Derivative Assets	166	850
Derivative Liabilities	10,695	11,757
Not Designated as Hedging Instrument [Member]
Derivative Assets Liabilities At Fair Value Net [Line Items]
Derivative Assets	2,755	2,861
Derivative Liabilities	2,755	2,861
Interest Rate Cap [Member]
Derivative Assets Liabilities At Fair Value Net [Line Items]
Derivative Assets	374	319
Derivative Liabilities	374	319
Other derivative
Derivative Assets Liabilities At Fair Value Net [Line Items]
Derivative Assets	11	42
Derivative Liabilities	$ 6	$ 0

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Consolidated Statements of Financial Condition (Unaudited) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Cash and cash equivalents
Cash and Due from Banks	$ 616,984	$ 614,302
Money market investments	7,652	6,967
Total cash and cash equivalents	624,636	621,269
Restricted Cash And Cash Equivalents	15,170	82,199
Securities purchased under agreements to resell	0	60,000
Investments:
Trading Securities	1,910	1,869
Investment securities available-for-sale, at fair value	1,455,685	1,588,425
Federal Home Loan Bank (FHLB) stock, at cost	24,430	24,450
Other investments	65	65
Total investments	1,482,090	1,614,809
Loans:
Mortgage loans held-for-sale, at lower of cost or fair value	19,355	46,529
Loans not covered under shared-loss agreements with the FDIC, net of allowance for loan and lease losses, excluding loans held-for-sale	4,635,394	4,615,929
Loans covered under shared-loss agreements with the FDIC, net of allowance for loan and lease losses	347,865	356,961
Total loans, net	5,002,614	5,019,419
Other asset
FDIC shared-loss indemnification asset	166,194	189,240
Foreclosed real estate covered under shared-loss agreements with the FDIC	37,785	33,209
Foreclosed real estate not covered under shared-loss agreements with the FDIC	59,099	56,815
Accrued interest receivable	18,969	18,734
Deferred tax asset, net	127,657	137,564
Premises and equipment, net	83,029	82,903
Customers' liability on acceptances	28,152	23,042
Servicing Assets	13,970	13,801
Derivative assets	15,861	20,502
Goodwill	86,069	86,069
Other assets	94,343	98,440
Total assets	7,855,638	8,158,015
Deposits:
Demand deposits	2,188,458	2,138,005
Savings accounts	1,267,290	1,194,567
Tme Deposits	1,845,244	2,050,693
Total deposits	5,300,992	5,383,265
Borrowings:
Securities sold under agreements to repurchase	1,012,240	1,267,618
Advances from FHLB	335,689	336,143
Subordinated capital notes	100,404	100,010
Federal Funds Purchased	23,712	0
Other borrowings	3,708	3,663
Total borrowings	1,475,753	1,707,434
Derivative liabilities	13,830	14,937
Acceptances executed and outstanding	28,535	23,042
Accrued expenses and other liabilities	140,037	144,424
Total liabilities	6,959,147	7,273,102
Stockholders' equity:
Preferred Stock	92,000	92,000
Convertible Preferred Stock	84,000	84,000
Common stock	52,714	52,707
Additional paid-in capital	538,287	538,071
Legal surplus	64,292	61,957
Retained earnings	147,919	133,629
Treasury stock, at cost	(90,743)	(80,642)
Accumulated other comprehensive income, net of tax, Total	8,022	3,191
Total stockholders' equity	896,491	884,913
Total liabilities and stockholders' equity	$ 7,855,638	$ 8,158,015

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Securities Purchased Under Agreements to Resell and Investment (Investment securities) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Schedule of Investments [Line Items]
Available for sale Amortized Cost	$ 1,437,106	$ 1,575,043
Available-for-sale Securities, Gross Unrealized Gains	32,771	34,096
Available-for-sale Securities, Gross Unrealized Losses	14,192	20,714
Available-for-sale Securities	1,455,685	1,588,425
Available for sale - Weighted Average Yield	2.74%	2.89%
Collateralized Mortgage Backed Securities [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	1,311,171	1,419,117
Available-for-sale Securities, Gross Unrealized Gains	32,546	33,929
Available-for-sale Securities, Gross Unrealized Losses	8,852	13,507
Available-for-sale Securities	1,334,865	1,439,539
Available for sale - Weighted Average Yield	2.84%	2.76%
Collateralized Mortgage Backed Securities [Member] | FNMA and FHLMC [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	1,093,717	1,190,910
Available-for-sale Securities, Gross Unrealized Gains	31,769	33,089
Available-for-sale Securities, Gross Unrealized Losses	4,690	6,669
Available-for-sale Securities	1,120,796	1,217,330
Available for sale - Weighted Average Yield	3.00%	2.93%
Collateralized Mortgage Backed Securities [Member] | GNMA [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	6,146	7,406
Available-for-sale Securities, Gross Unrealized Gains	426	433
Available-for-sale Securities, Gross Unrealized Losses	23	24
Available-for-sale Securities	6,549	7,815
Available for sale - Weighted Average Yield	4.93%	4.92%
Collateralized Mortgage Backed Securities [Member] | CMO's [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	211,308	220,801
Available-for-sale Securities, Gross Unrealized Gains	351	407
Available-for-sale Securities, Gross Unrealized Losses	4,139	6,814
Available-for-sale Securities	207,520	214,394
Available for sale - Weighted Average Yield	1.78%	1.78%
Securities Investment [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	125,935	155,926
Available-for-sale Securities, Gross Unrealized Gains	225	167
Available-for-sale Securities, Gross Unrealized Losses	5,340	7,207
Available-for-sale Securities	120,820	148,886
Available for sale - Weighted Average Yield	1.72%	2.99%
Securities Investment [Member] | US Treasury Securities [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	70,000
Available-for-sale Securities, Gross Unrealized Gains	0
Available-for-sale Securities, Gross Unrealized Losses	0
Available-for-sale Securities	70,000
Available for sale - Weighted Average Yield	0.03%
Securities Investment [Member] | Obligation of US Government sponsored agencies [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	9,539	10,691
Available-for-sale Securities, Gross Unrealized Gains	0	0
Available-for-sale Securities, Gross Unrealized Losses	42	42
Available-for-sale Securities	9,497	10,649
Available for sale - Weighted Average Yield	1.23%	1.21%
Securities Investment [Member] | Obligation of Puerto Rico Government and political subdivisions [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	22,367	121,035
Available-for-sale Securities, Gross Unrealized Gains	0	0
Available-for-sale Securities, Gross Unrealized Losses	5,298	6,845
Available-for-sale Securities	17,069	114,190
Available for sale - Weighted Average Yield	5.32%	4.38%
Securities Investment [Member] | Other Debt Obligations [Member]
Schedule of Investments [Line Items]
Available for sale Amortized Cost	24,029	24,200
Available-for-sale Securities, Gross Unrealized Gains	225	167
Available-for-sale Securities, Gross Unrealized Losses	0	320
Available-for-sale Securities	$ 24,254	$ 24,047
Available for sale - Weighted Average Yield	3.46%	3.46%

XML

Stockholders' Equity (Shares repurchased under the stock repurchase program) (Details) (USD $) In Thousands, except Share data, unless otherwise specified			3 Months Ended
	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2014 First Quarter [Member]	Mar. 31, 2014 January 2014 [Member]	Mar. 31, 2014 February 2014 [Member]
Equity, Class of Treasury Stock [Line Items]
Stock Repurchase Program, Number of Shares Authorized to be Repurchased			707,400	57,700	649,700
Treasury Stock Acquired, Average Cost Per Share			$ 14.66	$ 14.73	$ 14.66
Treasury Stock, Value	$ 90,743	$ 80,642	$ 10,372	$ 850	$ 9,522

XML

Consolidated Statements of Changes in Stockholders' Equity (Unaudited) (USD $) In Thousands	Total	Preferred Stock [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Preferred Stock Issuance Cost [Member]	Common Stock Issuance Cost [Member]	Legal Surplus [Member]	Retained Earnings [Member]	Treasury Stock [Member]	Accumulated Other Comprehensive Income (Loss) [Member]
Beginning Balance at Dec. 31, 2012		$ 176,000	$ 52,671	$ 537,453			$ 52,143	$ 70,734	$ (81,275)	$ 55,880
Stock-based compensation expense				437
Exercised Stock Options				0		0
Lapsed restricted stock units				(351)					351
Stock Issuance Cost					(23)	(16)
Transfer from/to legal surplus							1,985	(1,985)
Net income	21,192							21,192
Cash dividends declared on common stock								(2,737)
Cash dividends declared on preferred stock								(3,465)
Stock purchased	0								0
Stock used to match defined contribution plan									77
Other comprehensive loss, net of tax	(8,829)									(8,829)
Ending Balance at Mar. 31, 2013	870,242	176,000	52,671	537,500			54,128	83,739	(80,847)	47,051
Beginning Balance at Dec. 31, 2013	884,913	176,000	52,707	538,071			61,957	133,629	(80,642)	3,191
Stock-based compensation expense				439
Exercised Stock Options			7	71
Lapsed restricted stock units				(294)					292
Stock Issuance Cost					0	0
Transfer from/to legal surplus							2,335	(2,335)
Net income	23,747							23,747
Cash dividends declared on common stock								(3,657)
Cash dividends declared on preferred stock								(3,465)
Stock purchased	10,393								(10,393)
Stock used to match defined contribution plan									0
Other comprehensive loss, net of tax	4,831									4,831
Ending Balance at Mar. 31, 2014	$ 896,491	$ 176,000	$ 52,714	$ 538,287			$ 64,292	$ 147,919	$ (90,743)	$ 8,022

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Stockholders' Equity (Group's and the Bank's actual capital amounts and ratios) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Capital [Abstract]
Minimum to be well capitalized - Total Capital	$ 505,067	$ 511,893
Minimum to be well capitalized - Tier 1 capital	303,040	307,136
Minimum to be well capitalized - Tier 1 leverage	391,993	406,138
Risk Based Ratios [Abstract]
Capital Required to be Well Capitalized to Risk Weighted Assets	10.00%	10.00%
Tier One Risk Based Capital Required to be Well Capitalized to Risk Weighted Assets	6.00%	6.00%
Tier One Leverage Capital Required to be Well Capitalized to Average Assets	5.00%	5.00%
Group [Member]
Capital [Abstract]
Actual - Total capital	836,168	827,460
Actual - Tier 1 capital	745,619	736,930
Actual - Tier 1 leverage capital	745,619	736,930
Minimum Capital - Total Capital	404,054	409,514
Minimum capital - Tier 1 capital	202,027	204,757
Minimum capital - Tier 1 leverage capital	313,594	324,910
Risk Based Ratios [Abstract]
Capital to Risk Weighted Assets	16.56%	16.16%
Tier One Risk Based Capital to Risk Weighted Assets	14.76%	14.35%
Tier One Leverage Capital to Average Assets	9.51%	9.11%
Capital Required for Capital Adequacy to Risk Weighted Assets	8.00%	8.00%
Tier One Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets	4.00%	4.00%
Tier One Leverage Capital Required for Capital Adequacy to Average Assets	4.00%	4.00%
Bank [Member]
Capital [Abstract]
Actual - Total capital	805,900	779,413
Actual - Tier 1 capital	715,591	688,350
Actual - Tier 1 leverage capital	715,591	688,350
Minimum Capital - Total Capital	402,495	407,637
Minimum capital - Tier 1 capital	201,248	203,819
Minimum capital - Tier 1 leverage capital	311,659	322,395
Minimum to be well capitalized - Total Capital	503,119	509,547
Minimum to be well capitalized - Tier 1 capital	301,871	305,728
Minimum to be well capitalized - Tier 1 leverage	$ 389,574	$ 402,993
Risk Based Ratios [Abstract]
Capital to Risk Weighted Assets	16.02%	15.30%
Tier One Risk Based Capital to Risk Weighted Assets	14.22%	13.51%
Tier One Leverage Capital to Average Assets	9.18%	8.54%
Capital Required for Capital Adequacy to Risk Weighted Assets	8.00%	8.00%
Tier One Risk Based Capital Required for Capital Adequacy to Risk Weighted Assets	4.00%	4.00%
Tier One Leverage Capital Required for Capital Adequacy to Average Assets	4.00%	4.00%
Capital Required to be Well Capitalized to Risk Weighted Assets	10.00%	10.00%
Tier One Risk Based Capital Required to be Well Capitalized to Risk Weighted Assets	6.00%	6.00%
Tier One Leverage Capital Required to be Well Capitalized to Average Assets	5.00%	5.00%

XML

Allowance for Loan and Lease Losses (Allowance for loan and lease losses) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Provision for Non Covered Loan and Lease Losses	$ 10,062	$ 7,916
Non-covered acquired loans accounted under ASC 310-20
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	2,354	0
Charge-offs	(3,528)	(3,171)
Recoveries	550	1,437
Provision for Non Covered Loan and Lease Losses	4,242	2,120
Balance at end of period	3,618	386
Most recent acquired loans accounted under ASC 310-30
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	2,863
Provision for Non Covered Loan and Lease Losses	195
Balance at end of period	3,058
Non-covered originated loans [Member]
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	49,081	39,921
Charge-offs	(7,116)	(3,482)
Recoveries	1,917	100
Provision for Non Covered Loan and Lease Losses	5,625	5,795
Balance at end of period	49,507	42,334
Residential Portfolio Segment | Non-covered acquired loans accounted under ASC 310-20
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at end of period		0
Residential Portfolio Segment | Most recent acquired loans accounted under ASC 310-30
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	0
Provision for Non Covered Loan and Lease Losses	0
Balance at end of period	0
Residential Portfolio Segment | Non-covered originated loans [Member]
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	19,937	21,092
Charge-offs	(1,214)	(2,588)
Recoveries	148	0
Provision for Non Covered Loan and Lease Losses	640	4,385
Balance at end of period	19,511	22,889
Commercial Portfolio Segment | Non-covered acquired loans accounted under ASC 310-20
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	926	0
Charge-offs	(174)	0
Recoveries	0	0
Provision for Non Covered Loan and Lease Losses	115	386
Balance at end of period	867	386
Commercial Portfolio Segment | Most recent acquired loans accounted under ASC 310-30
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	1,713
Provision for Non Covered Loan and Lease Losses	940
Balance at end of period	2,653
Commercial Portfolio Segment | Non-covered originated loans [Member]
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	14,897	17,072
Charge-offs	(419)	(557)
Recoveries	98	28
Provision for Non Covered Loan and Lease Losses	(582)	(229)
Balance at end of period	13,994	16,314
Consumer Portfolio Segment | Non-covered acquired loans accounted under ASC 310-20
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	0	0
Charge-offs	(2,058)	(1,456)
Recoveries	100	207
Provision for Non Covered Loan and Lease Losses	2,462	1,249
Balance at end of period	504	0
Consumer Portfolio Segment | Most recent acquired loans accounted under ASC 310-30
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	418
Provision for Non Covered Loan and Lease Losses	(13)
Balance at end of period	405
Consumer Portfolio Segment | Non-covered originated loans [Member]
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	6,006	856
Charge-offs	(838)	(246)
Recoveries	147	65
Provision for Non Covered Loan and Lease Losses	1,820	638
Balance at end of period	7,135	1,313
Auto Portfolio Segment | Non-covered acquired loans accounted under ASC 310-20
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	1,428	0
Charge-offs	(1,296)	(1,715)
Recoveries	450	1,230
Provision for Non Covered Loan and Lease Losses	1,665	485
Balance at end of period	2,247
Auto Portfolio Segment | Most recent acquired loans accounted under ASC 310-30
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	732
Provision for Non Covered Loan and Lease Losses	(732)
Balance at end of period	0
Auto and Leasing Portfolio Segment | Non-covered originated loans [Member]
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	7,866	533
Charge-offs	(4,645)	(91)
Recoveries	1,524	7
Provision for Non Covered Loan and Lease Losses	3,986	1,292
Balance at end of period	8,731	1,741
Unallocated Financing Receivables | Non-covered acquired loans accounted under ASC 310-20
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	0	0
Charge-offs	0	0
Recoveries	0	0
Provision for Non Covered Loan and Lease Losses	0	0
Balance at end of period	0	0
Unallocated Financing Receivables | Non-covered originated loans [Member]
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	375	368
Charge-offs	0	0
Recoveries	0	0
Provision for Non Covered Loan and Lease Losses	(239)	(291)
Balance at end of period	136	77
Construction Portfolio Segment | Most recent acquired loans accounted under ASC 310-30
Financing Receivable, Allowance for Credit Losses [Roll Forward]
Balance at beginning of period	0
Provision for Non Covered Loan and Lease Losses	0
Balance at end of period	$ 0

XML

Stockholders' Equity (Changes in Other Comprehensive Income by Components) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Net unrealized gains on securities available for sale
Changes in components of Accumulated Other comprehensive Income
Beginning balance	$ 11,433	$ 68,245
Other Comprehensive Income Loss Before Reclassifications Net Of Tax	4,465	(9,899)
Reclassification Out Of Accumulated Other Comprehensive Income	137	47
Other Comprehensive Income Other Net Of Tax	4,602	(9,852)
Ending balance	16,035	58,393
Net unrealized loss on cash flow hedges
Changes in components of Accumulated Other comprehensive Income
Beginning balance	(8,242)	(12,365)
Other Comprehensive Income Loss Before Reclassifications Net Of Tax	(1,392)	(313)
Reclassification Out Of Accumulated Other Comprehensive Income	1,621	1,336
Other Comprehensive Income Other Net Of Tax	229	1,023
Ending balance	(8,013)	(11,342)
Accumulated Other Comprehensive Income (Loss) [Member]
Changes in components of Accumulated Other comprehensive Income
Beginning balance	3,191	55,880
Other Comprehensive Income Loss Before Reclassifications Net Of Tax	3,073	(10,212)
Reclassification Out Of Accumulated Other Comprehensive Income	1,758	1,383
Other Comprehensive Income Other Net Of Tax	4,831	(8,829)
Ending balance	$ 8,022	$ 47,051

XML

Borrowings (Tables)

3 Months Ended

Mar. 31, 2014

Debt Instruments [Abstract]

Schedule Of Repurchase Agreement Counterparty [Table Text Block]

	March 31,				December 31,
	2014				2013
			Fair Value of				Fair Value of
	Borrowing		Underlying		Borrowing		Underlying
	Balance		Collateral		Balance		Collateral
	(In thousands)
JP Morgan Chase Bank NA		255,000		273,834		255,000		273,250
Credit Suisse Securities (USA) LLC		755,000		860,088		755,000		864,232
Deutsche Bank		-		-		255,000		272,053
Total	$	1,010,000	$	1,133,922	$	1,265,000	$	1,409,535

Schedule of Repurchase Agreement by Maturity [Table text Block]

The following table shows a summary of the Company's repurchase agreements and their terms, excluding accrued interest in the amount of $2.2 million, at March 31, 2014:

			Weighted-
	Borrowing		Average		Maturity
Year of Maturity	Balance		Coupon	Settlement Date	Date
	(In thousands)
2014	$	85,000	0.675%	12/3/2012	12/3/2014
		85,000
2015		255,000	0.840%	12/10/2012	6/13/2015
		255,000
2016		170,000	1.500%	12/6/2012	12/8/2016
		170,000
2017		500,000	4.78%	3/2/2007	3/2/2017
	$	1,010,000	2.89%

Schedule of Repurchase Agreements [Table]

At March 31, 2014and December 31, 2013, securities sold under agreements to repurchase (classified by counterparty), excluding accrued interest in the amount of $2.2millionand $2.6million, respectively,were as follows

	March 31, 2014
					Market Value of Underlying Collateral
									CMOs		Obligations
			Weighted		FNMA and				issued by US		of US
	Repurchase		Average		FHLMC		GNMA		Government		Government
	Liability		Rate		Certificates		Certificates		Sponsored Agencies		Sponsored Agencies		Total
	(Dollars in thousands)
Over 90 days		1,010,000		2.89%		1,061,519		2,403		-		70,000		1,133,922
Total	$	1,010,000		2.89%	$	1,061,519	$	2,403	$	-	$	70,000	$	1,133,922

	December 31, 2013
					Market Value of Underlying Collateral
									CMOs		Obligations
			Weighted		FNMA and				issued by US		of US
	Repurchase		Average		FHLMC		GNMA		Government		Government
	Liability		Rate		Certificates		Certificates		Sponsored Agencies		Sponsored Agencies		Total
	(Dollars in thousands)
Within 30 days	$	255,000		0.50%	$	216,201	$	-	$	48,923	$	6,929	$	272,053
Over 90 days		1,010,000		2.89%		1,018,632		3,000		45,100		3,720		1,070,452
Total	$	1,265,000		2.41%	$	1,234,833	$	3,000	$	94,023	$	10,649	$	1,342,505

Federal Home Loan Bank Advances Maturities Summary [Table Text Block]

The following table shows a summary of these advances and their terms, excluding accrued interest in the amount of $327thousand,at March 31, 2014:

			Weighted-
		Borrowing	Average		Maturity
Year of Maturity		Balance	Coupon	Settlement Date	Date
		(In thousands)
2014	$	25,000	0.37%	3/4/2014	4/4/2014
		50,000	0.39%	3/10/2014	4/10/2014
		100,000	0.38%	3/17/2014	4/16/2014
		25,000	0.36%	3/24/2014	4/24/2014
		25,000	0.36%	3/31/2014	4/30/2014
		40,277	0.37%	3/3/2014	4/1/2014
		265,277
2017		4,673	1.24%	4/3/2012	4/3/2017
2018		30,000	2.19%	1/16/2013	1/16/2018
		25,000	2.18%	1/16/2013	1/16/2018
		55,000
2020		10,413	2.59%	7/19/2013	7/20/2020
	$	335,363	0.75%

Redemtion Funds [Table Text Block]

	Redemption fund
	(In thousands)
Redemption fund - March 31, 2014	$	48,575
2014		6,700
2015		6,700
2016		5,025
	$	67,000

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Allowance for Loan and Lease Losses (Credit Quality Indicator of non-covered loans) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	$ 4,689,259	$ 4,669,192
Non-covered originated loans [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	2,542,727	2,401,540
Doubtful	0
Financing Receivable, Individually Evaluated for Impairment	115,511	112,639
Commercial Secured [Member] | Non-covered originated loans [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	412,751	400,561
Pass	367,812	354,415
Special Mention	18,548	18,809
Substandard	1,892	2,376
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	24,499	24,961
Commercial Secured [Member] | Commercial Acquired loans (under ASC 310-20) [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	18,132	18,613
Pass	17,220	17,120
Special Mention	245	443
Substandard	667	1,050
Doubtful		0
Financing Receivable, Individually Evaluated for Impairment	0	0
Corporate | Non-covered originated loans [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	62,935	54,796
Pass	62,935	54,796
Special Mention	0	0
Substandard	0	0
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Corporate | Commercial Acquired loans (under ASC 310-20) [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	11,079	10,166
Pass	11,079	10,166
Special Mention	0	0
Substandard	0	0
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Institutional | Non-covered originated loans [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	9,833	4,050
Pass	9,833	4,050
Special Mention	0	0
Substandard	0	0
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Institutional | Commercial Acquired loans (under ASC 310-20) [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	0
Pass	0
Special Mention	0
Substandard	0
Doubtful	0
Financing Receivable, Individually Evaluated for Impairment	0
Middle Market | Non-covered originated loans [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	169,753	161,583
Pass	141,537	133,061
Special Mention	16,619	16,627
Substandard	0	118
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	11,597	11,777
Middle Market | Commercial Acquired loans (under ASC 310-20) [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	0
Pass	0
Special Mention	0
Substandard	0
Doubtful	0
Financing Receivable, Individually Evaluated for Impairment	0
Retail | Non-covered originated loans [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	156,694	166,642
Pass	139,971	149,018
Special Mention	1,929	2,182
Substandard	1,892	2,258
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	12,902	13,184
Retail | Commercial Acquired loans (under ASC 310-20) [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	4,301	5,770
Pass	3,490	4,378
Special Mention	245	443
Substandard	566	949
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Floor Plan | Non-covered originated loans [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	1,699	1,835
Pass	1,699	1,835
Special Mention	0	0
Substandard	0	0
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Floor Plan | Commercial Acquired loans (under ASC 310-20) [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	2,752	2,677
Pass	2,651	2,576
Special Mention	0	0
Substandard	101	101
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Real Estate | Non-covered originated loans [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	11,837	11,655
Pass	11,837	11,655
Special Mention	0	0
Substandard	0	0
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Real Estate | Commercial Acquired loans (under ASC 310-20) [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	0
Pass	0
Special Mention	0
Substandard	0
Doubtful	0
Financing Receivable, Individually Evaluated for Impairment	0
Other commercial and industrial [Member] | Non-covered originated loans [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	757,394	727,096
Pass	748,028	719,003
Special Mention	3,657	3,911
Substandard	2,441	997
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	3,268	3,185
Other commercial and industrial [Member] | Commercial Acquired loans (under ASC 310-20) [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	53,445	59,068
Pass	52,530	57,509
Special Mention	163	318
Substandard	752	1,241
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Corporate | Non-covered originated loans [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	28,475	32,598
Pass	28,475	32,598
Special Mention	0	0
Substandard	0	0
Doubtful		0
Financing Receivable, Individually Evaluated for Impairment	0	0
Corporate | Commercial Acquired loans (under ASC 310-20) [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	2,947	9,793
Pass	2,851	9,696
Special Mention	0	0
Substandard	96	97
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Institutional | Non-covered originated loans [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	553,249	536,445
Pass	553,249	536,445
Special Mention	0	0
Substandard	0	0
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Institutional | Commercial Acquired loans (under ASC 310-20) [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	221
Pass	221
Special Mention	0
Substandard	0
Doubtful	0
Financing Receivable, Individually Evaluated for Impairment	0
Middle Market | Non-covered originated loans [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	82,933	58,897
Pass	77,566	53,868
Special Mention	3,336	3,466
Substandard	771	198
Doubtful		0
Financing Receivable, Individually Evaluated for Impairment	1,260	1,365
Middle Market | Commercial Acquired loans (under ASC 310-20) [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	0
Pass	0
Special Mention	0
Substandard	0
Doubtful	0
Financing Receivable, Individually Evaluated for Impairment	0
Retail | Non-covered originated loans [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	67,055	61,510
Pass	63,366	58,742
Special Mention	119	257
Substandard	1,562	691
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	2,008	1,820
Retail | Commercial Acquired loans (under ASC 310-20) [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	17,216	27,338
Pass	16,460	26,044
Special Mention	100	150
Substandard	656	1,144
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Floor Plan | Non-covered originated loans [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	25,682	37,646
Pass	25,372	37,350
Special Mention	202	188
Substandard	108	108
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Floor Plan | Commercial Acquired loans (under ASC 310-20) [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	33,061	21,937
Pass	32,998	21,769
Special Mention	63	168
Substandard	0	0
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Commercial and Industrial | Commercial Acquired loans (under ASC 310-20) [Member]
Credit Quality Indicators [Line Items]
Doubtful	0
Total Commercial subject to risk rating [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	1,241,722	1,205,338
Pass	1,185,590	1,148,047
Special Mention	22,613	23,481
Substandard	5,752	5,664
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	27,767	28,146
Total Commercial subject to risk rating [Member] | Non-covered originated loans [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	1,170,145	1,127,657
Pass	1,115,840	1,073,418
Special Mention	22,205	22,720
Substandard	4,333	3,373
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	27,767	28,146
Total Commercial subject to risk rating [Member] | Commercial Acquired loans (under ASC 310-20) [Member]
Credit Quality Indicators [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	71,577	77,681
Pass	69,750	74,629
Special Mention	408	761
Substandard	1,419	2,291
Doubtful	0	0
Financing Receivable, Individually Evaluated for Impairment	$ 0	$ 0

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Guarantees

3 Months Ended

Mar. 31, 2014

Guarantees [Abstract]

Guarantees [Text Block]

NOTE 15 – GUARANTEES

At March 31, 2014 the unamortized balance of the obligations undertaken in issuing the guarantees under standby letters of credit represented a liability of $38.9million (December 31, 2013 - $38.6million).

The Company assumed a liability for residential mortgage loans sold by BBVAPR Bank subject to credit recourse, principally loans associated with FNMA residential mortgage loan sales and securitization programs. At March 31, 2014 and December 31, 2013, the unpaid principal balance of residential mortgage loans sold subject to credit recourse was $118.2million and $122.3 million, respectively. In the event of any customer default, pursuant to the credit recourse provided, the Company is required to repurchase the loan or reimburse the third party investor for the incurred loss. The maximum potential amount of future payments that the Company would be required to make under the recourse arrangements in the event of nonperformance by the borrowers is equivalent to the total outstanding balance of the residential mortgage loans serviced with recourse and interest, if applicable. During the quarter endedMarch 31, 2014, the Company repurchased approximately $1.6million of unpaid principal balance in mortgage loans subject to the credit recourse provisions. In the event of nonperformance by the borrower, the Company has rights to the underlying collateral securing the mortgage loan. The Company suffers ultimate losses on these loans when the proceeds from a foreclosure sale of the property underlying a defaulted mortgage loan are less than the outstanding principal balance of the loan plus any uncollected interest advanced and the costs of holding and disposing the related property. At March 31, 2014 and December 31, 2013 the Company's liability established to cover the estimated credit loss exposure related to loans sold with credit recourse amounted to $1.5 million (December 31, 2013 – $2.0million). The following table shows the changes in the Company's liability of estimated loss from these credit recourse agreements, included in the unaudited consolidated statements of financial condition during the quarters ended March 31, 2014 and 2013.

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Balance at beginning of year	$	1,955	$	-
Additions from BBVAPR Acquisition		-		2,460
Net charge-offs/terminations		(406)		-
Balance at end of year	$	1,549	$	2,460

The estimated losses to be absorbed under the credit recourse arrangements are recorded as a liability when the loans are sold or credit recourse is assumed, and are updated on a quarterly basis. The expected loss, which represents the amount expected to be lost on a given loan, considers the probability of default and loss severity. The probability of default represents the probability that a loan in good standing would become 120 days delinquent, in which case the Company is obligated to repurchase the loan. At March 31,2014, $86.5million or 73% of the recourse obligation will be extinguished during the next two years.

When the Company sells or securitizes mortgage loans, it generally makes customary representations and warranties regarding the characteristics of the loans sold. The Company's mortgage operations division groups conforming mortgage loans into pools which are exchanged for FNMA and GNMA mortgage-backed securities, which are generally sold to private investors, or are sold directly to FNMA or other private investors for cash. As required under such mortgage backed securities programs, quality review procedures are performed by the Company to ensure that asset guideline qualifications are met. To the extent the loans do not meet specified characteristics, the Company may be required to repurchase such loans or indemnify for losses and bear any subsequent loss related to the loans. Repurchases during the quarter ended March 31, 2014 under the Company's representation and warranty arrangements, excluding mortgage loans subject to credit recourse provisions referred to above, approximated $2.8million in unpaid principal balance(December 31, 2013 - $12.5million). A substantial amount of these loans reinstate to performing status or have mortgage insurance, and thus the ultimate losses on the loans are not deemed significant.

During the quarter ended March 31, 2014, the Company recognized $50thousandin losses from the repurchase of residential mortgage loans sold, subject to credit recourse and $434 thousandnot subject to credit recourse. In addition, during the quarter ended March 31, 2013, the Company recognized $25 thousand in losses from the repurchase of residential mortgage loans sold, subject to credit recourse and $2 thousand not subject to credit recourse.

Servicing agreements relating to the mortgage-backed securities programs of FNMA and GNMA, and to mortgage loans sold or serviced to certain other investors, including FHLMC, require the Company to advance funds to make scheduled payments of principal, interest, taxes and insurance, if such payments have not been received from the borrowers. At March 31, 2014, the Company serviced $1.1 billion in mortgage loans for third-parties. The Company generally recovers funds advanced pursuant to these arrangements from the mortgage owner, from liquidation proceeds when the mortgage loan is foreclosed or, in the case of FHA/VA loans, under the applicable FHA and VA insurance and guarantees programs. However, in the meantime, the Company must absorb the cost of the funds it advances during the time the advance is outstanding. The Company must also bear the costs of attempting to collect on delinquent and defaulted mortgage loans. In addition, if a defaulted loan is not cured, the mortgage loan would be canceled as part of the foreclosure proceedings and the Company would not receive any future servicing income with respect to that loan. At March 31, 2014, the outstanding balance of funds advanced by the Company under such mortgage loan servicing agreements was approximately $323thousand (December 31, 2013 - $243thousand). To the extent the mortgage loans underlying the Company's servicing portfolio experience increased delinquencies, the Company would be required to dedicate additional cash resources to comply with its obligation to advance funds as well as incur additional administrative costs related to increases in collection efforts.

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Offsetting of Financial Assets and Liabilities (Tables)

3 Months Ended

Mar. 31, 2014

Offsetting [Abstract]

Offsetting Assets [Table Text Block]

March 31, 2014
							Gross Amounts Not Offset in the Statement of Financial Condition
			Gross Amounts		Net Amount of
			Offset in the		Assets Presented
	Gross Amount		Statement of		in Statement				Cash
	of Recognized		Financial		of Financial		Financial		Collateral		Net
	Assets		Condition		Condition		Instruments		Received		Amount
	(In thousands)
Derivatives	$	15,861	$	-	$	15,861	$	6,814	$	-	$	9,047
Total	$	15,861	$	-	$	15,861	$	6,814	$	-	$	9,047
December 31, 2013
							Gross Amounts Not Offset in the Statement of Financial Condition
			Gross Amounts		Net amount of
			Offset in the		Assets Presented
	Gross Amount		Statement of		in Statement				Cash
	of Recognized		Financial		of Financial		Financial		Collateral		Net
	Assets		Condition		Condition		Instruments		Received		Amount
					(In thousands)
Derivatives	$	20,502	$	-	$	20,502	$	2,450	$	6,780	$	11,272
Securities purchased under agreements to resell		60,000		-		60,000		64,587		-		(4,587)
Total	$	80,502	$	-	$	80,502	$	67,037	$	6,780	$	6,685

Offsetting Liabilities [Table Text Block]

March 31, 2014
							Gross Amounts Not Offset in the Statement of Financial Condition
					Net Amount of
			Gross Amounts		Liabilities
			Offset in the		Presented
	Gross Amount		Statement of		in Statement				Cash
	of Recognized		Financial		of Financial		Financial		Collateral		Net
	Liabilities		Condition		Condition		Instruments		Provided		Amount
					(In thousands)
Derivatives	$	25,950	$	-	$	25,950	$	-	$	2,980	$	22,970
Securities sold under agreements to repurchase		1,010,000		-		1,010,000		1,133,922		-		(123,922)
Total	$	1,035,950	$	-	$	1,035,950	$	1,133,922	$	2,980	$	(100,952)
December 31, 2013
							Gross Amounts Not Offset in the Statement of Financial Condition
					Net Amount of
			Gross Amounts		Liabilities
			Offset in the		Presented
	Gross Amount		Statement of		in Statement				Cash
	of Recognized		Financial		of Financial		Financial		Collateral		Net
	Liabilities		Condition		Condition		Instruments		Provided		Amount
	(In thousands)
Derivatives	$	30,672	$	-	$	30,672	$	-	$	2,349	$	28,323
Securities sold under agreements to repurchase		1,265,000		-		1,265,000		1,277,919		67,029		(79,948)
Total	$	1,295,672	$	-	$	1,295,672	$	1,277,919	$	69,378	$	(51,625)

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Stockholders' Equity (accumulated Comprehensive Income, net of income tax) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended	12 Months Ended
	Mar. 31, 2014	Dec. 31, 2013
Accumulated Other Comprehensive Income [Line Items]
Accumulated other comprehensive income, net of tax, Total	$ 8,022	$ 3,191
Accumulated Other Comprehensive Income (Loss) [Member]
Accumulated Other Comprehensive Income [Line Items]
Accumulated other comprehensive income, net of tax, Total	8,022	3,191
AccumulatedOtherThanTemporaryImpairmentMember
Accumulated Other Comprehensive Income [Line Items]
Unrealized gain on securities available-for-sale which are not other-than-temporarily impaired	18,464	13,267
Income tax effect of unrealized gain on securities available-for-sale	(2,429)	(1,834)
Net unrealized gain on securities available for sale wich are not other than temporarily impaired	16,035	11,433
Accumulated Net Gain Loss From Designated Or Qualifying Cash Flow Hedges [Member]
Accumulated Other Comprehensive Income [Line Items]
Unrealized loss on cash flow hedges	(10,529)	(10,907)
Income tax effect of unrealized loss on cash flow hedges	2,516	2,665
Net unrealized (loss) income on cash flow hedges	$ (8,013)	$ (8,242)

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Fair Value of Financial Instruments

3 Months Ended

Mar. 31, 2014

Fair Value Disclosures [Abstract]

FAIR VALUE

NOTE 17- FAIR VALUEOF FINANCIAL INSTRUMENTS

The Company follows the fair value measurement framework under GAAP.

Fair Value Measurement

The fair value measurement framework defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. This framework also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs previously described that may be used to measure fair value.

Money market investments

The fair value of money market investments is based on the carrying amounts reflected in the consolidated statements of financial condition as these are reasonable estimates of fair value given the short-term nature of the instruments.

Investment securities

The fair value of investment securities is based on quoted market prices, when available, or market prices provided by recognized broker-dealers. If listed prices or quotes are not available, fair value is based upon externally developed models that use both observable and unobservable inputs depending on the market activity of the instrument. The Company holds two securities categorized as other debt that are classified as Level 3. The estimated fair value of the other debt securitiesis determined by using a third-party model to calculate the present value of projected future cash flows. The assumptions are highly uncertain and include primarily market discount rates, current spreads, and an indicative pricing. The assumptions used are drawn from similar securities that are actively traded in the market and have similar characteristics as the collateral underlying the debt securities being evaluated. The valuation is performed on a monthly basis.

Derivative instruments

The fair value of the interest rate swapsis largely a function of the financial market's expectations regarding the future direction of interest rates. Accordingly, current market values are not necessarily indicative of the future impact of derivative instruments on earnings. This will depend, for the most part, on the shape of the yield curve, the level of interest rates, as well as the expectations for rates in the future. The fair value of most of these derivative instruments is based on observable market parameters, which include discounting the instruments' cash flows using the U.S. dollar LIBOR-based discount rates, and also applying yield curves that account for the industry sector and the credit rating of the counterparty and/or the Company.

Certain other derivative instruments with limited market activity are valued using externally developed models that consider unobservable market parameters. Based on their valuation methodology, derivative instruments are classified as Level 2 or Level 3. The Company has offered its customers certificates of deposit with an option tied to the performance of the S&P Index and uses equity indexed option agreements with major broker-dealers to manage its exposure to changes in this index. Their fair value is obtained through the use of an external based valuation that was thoroughly evaluated and adopted by management as its measurement tool for these options. The payoff of these options is linked to the average value of the S&P Index on a specific set of dates during the life of the option. The methodology uses an average rate option or a cash-settled option whose payoff is based on the difference between the expected average value of the S&P Index during the remaining life of the option and the strike price at inception. The assumptions, which are uncertain and require a degree of judgment, include primarily S&P Index volatility, forward interest rate projections, estimated index dividend payout, and leverage.

Servicing assets

Servicing assets do not trade in an active market with readily observable prices. Servicing assets are priced using a discounted cash flow model. The valuation model considers servicing fees, portfolio characteristics, prepayment assumptions, delinquency rates, late charges, other ancillary revenues, cost to service and other economic factors. Due to the unobservable nature of certain valuation inputs, the servicing rights are classified as Level 3.

Loans receivable considered impaired that are collateral dependent

The impairment is measured based on the fair value of the collateral, which is derived from appraisals that take into consideration prices in observed transactions involving similar assets in similar locations, in accordance with the provisions of ASC 310-10-35. Currently, the associated loans considered impaired are classified as Level 3.

Foreclosed real estate

Foreclosed real estate includes real estate properties securing residential mortgage and commercial loans. The fair value of foreclosed real estate may be determined using an external appraisal, broker price option or an internal valuation. These foreclosed assets are classified as Level 3 given certain internal adjustments that may be made to external appraisals.

Assets and liabilities measured at fair value on a recurring and non-recurring basis, including financial liabilitiesfor which the Company has elected the fair value option, are summarized below:

	March 31, 2014
	Fair Value Measurements
	Level 1		Level 2		Level 3		Total
	(In thousands)
Recurring fair value measurements:
Investment securities available-for-sale	$	-	$	1,435,632	$	20,053	$	1,455,685
Money market investments		7,652		-		-		7,652
Derivative assets		-		3,306		12,555		15,861
Servicing assets		-		-		13,970		13,970
Derivative liabilities		-		(13,830)		(12,120)		(25,950)
	$	7,652	$	1,425,108	$	34,458	$	1,467,218
Non-recurring fair value measurements:
Impaired commercial loans	$	-	$	-	$	27,975	$	27,975
Foreclosed real estate		-		-		96,884		96,884
	$	-	$	-	$	124,859	$	124,859

	December 31, 2013
	Fair Value Measurements
	Level 1		Level 2		Level 3		Total
	(In thousands)
Recurring fair value measurements:
Investment securities available-for-sale	$	-	$	1,568,745	$	19,680	$	1,588,425
Securities purchased under agreements to resell		-		60,000		-		60,000
Money market investments		6,967		-		-		6,967
Derivative assets		-		4,072		16,430		20,502
Servicing assets		-		-		13,801		13,801
Derivative liabilities		-		(14,937)		(15,736)		(30,673)
	$	6,967	$	1,617,880	$	34,175	$	1,659,022
Non-recurring fair value measurements:
Impaired commercial loans	$	-	$	-	$	28,353	$	28,353
Foreclosed real estate		-		-		90,024		90,024
	$	-	$	-	$	118,377	$	118,377

The table below presents a reconciliation of all assets and liabilities measured at fair value on a recurring basisusing significant unobservable inputs (Level 3) for the quarters ended March31, 2014 and 2013:

	Quarter Ended March 31, 2014
				Derivative				Derivative
		Other		asset				liability
		debt		(S&P				(S&P
		securities		Purchased		Servicing		Embedded
Level 3 Instruments Only		available-for-sale		Options)		assets		Options)		Total
	(In thousands)
Balance at beginning of year		$	19,680	$	16,430	$	13,801	$	(15,736)	$	34,175
Gains (losses) included in earnings			-		(3,875)		-		3,373		(502)
Changes in fair value of investment securities available for sale included in other comprehensive income			373		-		-		-		373
New instruments acquired			-		-		563		-		563
Principal repayments			-		-		(196)		-		(196)
Amortization			-		-		-		243		243
Changes in fair value of servicing assets			-		-		(198)		-		(198)
Balance at end of year		$	20,053	$	12,555	$	13,970	$	(12,120)	$	34,458

	Quarter Ended March 31, 2013
	Investment securities
	available-for-sale
					Derivative				Derivative
					asset				liability
			Other		(S&P				(S&P
			debt		Purchased		Servicing		Embedded
Level 3 Instruments Only	CLOs		securities		Options)		assets		Options)		Total
Balance at beginning of period	$	27,280	$	10,016	$	11,367	$	10,776	$	(10,912)	$	48,527
Gains (losses) included in earnings		-		-		1,721		-		(1,707)		14
Changes in fair value of investment securities available for sale included in other comprehensive income		1,705		1		-		-		-		1,706
New instruments acquired		-		-		-		487		-		487
Principal repayments		-		-		-		(307)		-		(307)
Amortization		17		-		-		-		50		67
Changes in fair value of servicing assets		-		-		-		(314)		-		(314)
Balance at end of period	$	29,002	$	10,017	$	13,088	$	10,642	$	(12,569)	$	50,180

During the quarter ended March 31, 2014 and 2013, there were purchases and sales of assets and liabilities measured at fair value on a recurring basis. There were no transfers into and out of Level 1 and Level 2 fair value measurements during such periods.

The table below presents quantitative information for all assets and liabilities measured at fair value on a recurring basisusing significant unobservable inputs (Level 3) at March 31, 2014:

	March 31, 2014
	Fair Value		Valuation Technique	Unobservable Input	Range
	(In thousands)
Investment securities available-for-sale:
Other debt securities	$	20,053	Market comparable bonds	Indicative pricing	97.125% - 98.975%
				Option adjusted spread	683.7% - 1602.0%
				Yield to maturity	7.05% - 15.89%
				Spread to maturity	689.9% - 1579.0%
Derivative assets (S&P Purchased Options)	$	12,555	Option pricing model	Implied option volatility	22.887% - 53.615%
				Counterparty credit risk (based on 5-year credit default swap ("CDS") spread)	56.360% - 86.490%
Servicing assets	$	13,970	Cash flow valuation	Constant prepayment rate	5.60% - 10.08%
				Discount rate	10.00% - 12.00%
Derivative liability (S&P Embedded Options)	$	(12,120)	Option pricing model	Implied option volatility	22.887% - 53.615%
				Counterparty credit risk (based on 5-year CDS spread)	56.360% - 86.490%
Collateral dependant impaired loans	$	27,975	Fair value of property or collateral	Appraised value less disposition costs	21.30% - 28.30%

Information about Sensitivity to Changes in Significant Unobservable Inputs

Other debt securities – The significant unobservable inputs used in the fair value measurement of one of the Company's other debt securities are indicative comparable pricing, option adjusted spread (“OAS”), yield to maturity, and spread to maturity. Significant changes in any of those inputs in isolation would result in a significantly different fair value measurement. Generally, a change in the assumption used for indicative comparable pricing is accompanied by a directionally opposite change in the assumption used for OAS and a directionally, although not equally proportional, opposite change in the assumptions used for yield to maturity and spread to maturity.

Derivative asset (S&P Purchased Options) – The significant unobservable inputs used in the fair value measurement of the Company's derivative assets related to S&P purchased options are implied option volatility and counterparty credit risk. Significant changes in any of those inputs in isolation would result in a significantly different fair value measurement. Generally, a change in the assumption used for implied option volatility is not necessarily accompanied by directionally similar or opposite changes in the assumption used for counterparty credit risk.

Servicing assets – The significant unobservable inputs used in the fair value measurement of the Company's servicing assets are constant prepayment rates and discount rates. Changes in one factor may result in changes in another (for example, increases in market interest rates may result in lower prepayments), which may magnify or offset the sensitivities. Mortgage banking activities, a component of total banking and financial servicerevenue in the consolidated statements of operations, include the changes from period to period in the fair value of the mortgage loan servicing rights, which may result from changes in the valuation model inputs or assumptions (principally reflecting changes in discount rates and prepayment speed assumptions) and other changes, including changes due to collection/realization of expected cash flows.

Derivative liability (S&P Embedded Options) – The significant unobservable inputs used in the fair value measurement of theCompany's derivative liability related to S&P purchased options are implied option volatility and counterparty credit risk. Significant changes in any of those inputs in isolation would result in a significantly different fair value measurement. Generally, a change in the assumption used for implied option volatility is not necessarily accompanied by directionally similar or opposite changes in the assumption used for counterparty credit risk.

The table below presents a detail of investment securities available-for-sale classified as Level 3 at March 31,2014:

	March 31, 2014
							Weighted
	Amortized		Unrealized				Average	Principal
Type	Cost		Gains (Losses)		Fair Value		Yield	Protection
	(In thousands)
Other debt securities	$	20,000	$	53	$	20,053	3.50%	N/A

Fair Value of Financial Instruments

The information about the estimated fair value of financial instruments required by GAAP is presented hereunder. The aggregate fair value amounts presented do not necessarily represent management's estimate of the underlying value of the Company.

The estimated fair value is subjective in nature, involves uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could affect these fair value estimates. The fair value estimates do not take into consideration the value of future business and the value of assets and liabilities that are not financial instruments. Other significant tangible and intangible assets that are not considered financial instruments are the value of long-term customer relationships of retail deposits, and premises and equipment.

The estimated fair value and carrying value of the Company's financial instruments at March 31, 2014 and December 31, 2013 is as follows:

	March 31,				December 31,
	2014				2013
	Fair		Carrying		Fair		Carrying
	Value		Value		Value		Value
	(In thousands)
Level 1
Financial Assets:
Cash and cash equivalents	$	624,636	$	624,636	$	621,269	$	621,269
Restricted cash		15,170		15,170		82,199		82,199
Level 2
Financial Assets:
Securities purchased under agreements to resell		-		-		60,000		60,000
Trading securities		1,910		1,910		1,869		1,869
Investment securities available-for-sale		1,435,632		1,435,632		1,568,745		1,568,745
Federal Home Loan Bank (FHLB) stock		24,430		24,430		24,450		24,450
Derivative assets		3,306		3,306		4,072		4,072
Derivative liabilities		13,830		13,830		14,937		14,937
Level 3
Financial Assets:
Investment securities available-for-sale		20,053		20,053		19,680		19,680
Total loans (including loans held-for-sale)
Non-covered loans, net		4,737,604		4,654,749		4,857,505		4,662,458
Covered loans, net		400,355		347,865		459,444		356,961
Derivative assets		12,555		12,555		16,430		16,430
FDIC shared-loss indemnification asset		106,170		166,194		152,965		189,240
Accrued interest receivable		18,969		18,969		18,734		18,734
Servicing assets		13,970		13,970		13,801		13,801
Financial Liabilities:
Deposits		5,247,226		5,300,992		5,409,540		5,383,265
Securities sold under agreements to repurchase		1,076,000		1,012,240		1,323,903		1,267,618
Advances from FHLB		340,805		335,689		335,324		336,143
Federal funds purchased		23,712		23,712		-		-
Term notes		3,583		3,708		3,638		3,663
Subordinated capital notes		87,240		100,404		99,316		100,010
Accrued expenses and other liabilities		140,037		140,037		144,424		144,424

The following methods and assumptions were used to estimate the fair values of significant financial instruments at March 31, 2014 and December 31, 2013:

•Cash and cash equivalents (including money market investments and time deposits with other banks), restricted cash, accrued interest receivable, securities purchased under agreements to resell, securities sold but not yet delivered,accrued expenses and other liabilities have been valued at the carrying amounts reflected in the consolidated statements of financial condition as these are reasonable estimates of fair value given the short-term nature of the instruments.

•Investments in FHLB-NY stock are valued at their redemption value.

•The fair value of investment securities, including trading securities, is based on quoted market prices, when available, or market prices provided by recognized broker-dealers. If listed prices or quotes are not available, fair value is based upon externally developed models that use both observable and unobservable inputs depending on the market activity of the instrument. The estimated fair value of the structured credit investments is determined by using a third-party cash flow valuation model to calculate the present value of projected future cash flows. The assumptions used which are highly uncertain and require a high degree of judgment, include primarily market discount rates, current spreads, duration, leverage, default, home price depreciation, and loss rates. The assumptions used are drawn from a wide array of data sources, including the performance of the collateral underlying each deal. The external-based valuation, which is obtained at least on a quarterly basis, is analyzed and its assumptions are evaluated and incorporated in either an internal-based valuation model when deemed necessary, or compared to counterparties' prices and agreed by management.

•The fair value of the FDIC shared-loss indemnification asset represents the present value of the net estimated cash payments expected to be received from the FDIC for future losses on covered assets based on the credit assumptions on estimated cash flows for each covered asset pool and the loss sharing percentages. The ultimate collectability of the FDIC shared-loss indemnification asset is dependent upon the performance of the underlying covered loans, the passage of time and claims paid by the FDIC which are impacted by the Bank's adherence to certain guidelines established by the FDIC.

•The fair value of servicing assets is estimated by using a cash flow valuation model which calculates the present value of estimated future net servicing cash flows, taking into consideration actual and expected loan prepayment rates, discount rates, servicing costs, and other economic factors, which are determined based on current market conditions.

•The fair values of the derivative instruments are provided by valuation experts and counterparties. Certain derivatives with limited market activity are valued using externally developed models that consider unobservable market parameters. The Company has offered its customers certificates of deposit with an option tied to the performance of the S&P Index, and uses equity indexed option agreements with major broker-dealers to manage its exposure to changes in this index. Their fair value is obtained through the use of an external based valuation that was thoroughly evaluated and adopted by management as its measurement tool for these options. The payoff of these options is linked to the average value of the S&P Index on a specific set of dates during the life of the option. The methodology uses an average rate option or a cash-settled option whose payoff is based on the difference between the expected average value of the S&P Index during the remaining life of the option and the strike price at inception. The assumptions, which are uncertain and require a degree of judgment, include primarily S&P Index volatility, forward interest rate projections, estimated index dividend payout, and leverage.

•Fair value of derivative liabilities, which include interest rate swaps and forward-settlement swaps, are based on the net discounted value of the contractual projected cash flows of both the pay-fixed receive-variable legs of the contracts. The projected cash flows are based on the forward yield curve, and discounted using current estimated market rates.

•The fair value of the covered and non-covered loan portfolio (including loans held-for-sale) is estimated by segregating by type, such as mortgage, commercial, consumer, auto andleasing. Each loan segment is further segmented into fixed and adjustable interest rates and by performing and non-performing categories. The fair value of performing loans is calculated by discounting contractual cash flows, adjusted for prepayment estimates (voluntary and involuntary), if any, using estimated current market discount rates that reflect the credit and interest rate risk inherent in the loan. This fair value is not currently an indication of an exit price as that type of assumption could result in a different fair value estimate.

•The fair value of demand deposits and savings accounts is the amount payable on demand at the reporting date. The fair value of fixed-maturity certificates of deposit is based on the discounted value of the contractual cash flows, using estimated current market discount rates for deposits of similar remaining maturities.

•For short term borrowings and federal funds purchased, the carrying amount is considered a reasonable estimate of fair value. The fair value of long-term borrowings, which include securities sold under agreements to repurchase, advances from FHLB-NY, FDIC-guaranteed term notes,other term notes, and subordinated capital notes, is based on the discounted value of the contractual cash flows using current estimated market discount rates for borrowings with similar terms, remaining maturities and put dates.

•The fair value of commitments to extend credit and unused lines of credit is based on fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the counterparties' credit standings.

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Allowance for Loan and Lease Losses (Recorded Investment in Covered Loan Pools) (Details) (USD $) In Thousands, unless otherwise specified					3 Months Ended	12 Months Ended	3 Months Ended	12 Months Ended	3 Months Ended	12 Months Ended	3 Months Ended	12 Months Ended	3 Months Ended	12 Months Ended
	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2013	Dec. 31, 2012	Mar. 31, 2014 Covered Loan [Member]	Dec. 31, 2013 Covered Loan [Member]	Mar. 31, 2014 Loans Secured by 1-4 properties Covered Loan [Member]	Dec. 31, 2013 Loans Secured by 1-4 properties Covered Loan [Member]	Mar. 31, 2014 Construction and development secured by multi-family properties [Member] Covered Loan [Member]	Dec. 31, 2013 Construction and development secured by multi-family properties [Member] Covered Loan [Member]	Mar. 31, 2014 Other Commercial and Industrial[Member] Covered Loan [Member]	Dec. 31, 2013 Other Commercial and Industrial[Member] Covered Loan [Member]	Mar. 31, 2014 Consumer Loan [Member] Covered Loan [Member]	Dec. 31, 2013 Consumer Loan [Member] Covered Loan [Member]
Financing Receivable, Impaired [Line Items]
Unpaid Principal					$ 415,110	$ 338,257	$ 147,597	$ 52,142	$ 65,747	$ 66,037	$ 192,095	$ 209,566	$ 9,671	$ 10,512
Recorded Investment					246,846	173,286	111,410	38,179	18,254	17,304	111,679	111,946	5,503	5,857
Allowance for loan and lease losses, covered	$ 54,398	$ 52,729	$ 52,974	$ 54,124	$ 54,398	$ 52,729	$ 14,221	$ 12,495	$ 6,866	$ 6,866	$ 32,696	$ 32,753	$ 615	$ 615
Coverage					22.00%	30.00%	13.00%	33.00%	38.00%	40.00%	29.00%	29.00%	11.00%	11.00%

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Fair Value (Qualitative information for assets and liabilities) (Details) (USD $) In Thousands, unless otherwise specified						3 Months Ended
	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member]	Dec. 31, 2013 Fair Value, Inputs, Level 3 [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member] Other Debt Obligations [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member] Other Debt Obligations [Member] Market Approach Valuation Technique [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member] Other Debt Obligations [Member] Market Approach Valuation Technique [Member] Minimum [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member] Other Debt Obligations [Member] Market Approach Valuation Technique [Member] Maximum [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member] Derivative asset (S&P Purchased Options) [Member] Option Pricing Model Technique [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member] Derivative asset (S&P Purchased Options) [Member] Option Pricing Model Technique [Member] Minimum [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member] Derivative asset (S&P Purchased Options) [Member] Option Pricing Model Technique [Member] Maximum [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member] Servicing Assets [Member] Cash Flow Valuation Technique [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member] Servicing Assets [Member] Cash Flow Valuation Technique [Member] Minimum [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member] Servicing Assets [Member] Cash Flow Valuation Technique [Member] Maximum [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member] Derivative liability (S&P Embedded Options) [Member] Option Pricing Model Technique [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member] Derivative liability (S&P Embedded Options) [Member] Option Pricing Model Technique [Member] Minimum [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member] Derivative liability (S&P Embedded Options) [Member] Option Pricing Model Technique [Member] Maximum [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member] Collateral dependant impaired loan Fair value of property or collateral [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member] Collateral dependant impaired loan Fair value of property or collateral [Member] Minimum [Member]	Mar. 31, 2014 Fair Value, Inputs, Level 3 [Member] Collateral dependant impaired loan Fair value of property or collateral [Member] Maximum [Member]
Fair Value Inputs Assets Quantitative Information [Line Items]
Fair Value assets and liabilities measured on reccurring basis	$ 1,455,685	$ 1,588,425	$ 20,053	$ 19,680	$ 20,053	$ 20,053			$ 12,555			$ 13,970			$ (12,120)			$ 27,975
Valuation Technique						Market comparable bonds			Option pricing model			Cash flow valuation			Option pricing model			Fair value of property or collateral
Unobservable Input						Indicative pricing Option adjusted spread Yield to maturity Spread to maturity			Implied option volatility Counterparty credit risk (based on 5-year credit default swap ("CDS") spread)			Constant prepayment rate Discount rate			Implied option volatility Counterparty credit risk (based on 5-year CDS spread)			Appraised value less disposition costs
Indicative Pricing							97.125%	98.97%
OAS spread							683.70%	1602.00%
Yield to maturity							7.05%	15.89%
Spread to maturity							689.90%	1579.00%
Implied option volatility										22.887%	53.615%					22.887%	53.615%
Counterparty credit risk (based on 5-year CDS spread)										56.36%	86.49%					56.36%	86.49%
Constant prepayment rate													5.60%	10.08%
Discount rate													10.00%	12.00%
Appraised value																			21.30%	28.30%

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Consolidated Statements of Cash Flows (Unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Cash flows from operating activities:
Net income	$ 23,747	$ 21,192
Adjustments to reconcile net income to net cash provied by (used in) operating activities:
Amortization of deferred loan origination fees, net of costs	601	256
Amortization of discount to fair value of acquired loan	3,634	2,579
Amortization of investment securities premiums, net of accretion of discounts	412	6,200
Amortization of core deposit and customer relationship intangibles	542	644
Amortization of fair value premium of acquired deposits	1,897	5,267
FDIC Loss Share (Expense), net	18,487	12,871
Amortization of prepaid FDIC assesment	0	860
Other impairments on securities	0	7
Depreciation and amortization of premises and equipment	2,399	3,092
Deferred income taxes, net	(826)	5,265
Provision for covered and non-covered loan and lease losses, net	11,691	8,588
Stock-based compensation	439	437
(Gain) loss on:
Sale of securities	(4,366)	0
Sale of mortgage loans held for sale	(1,242)	(1,631)
Derivatives	478	788
Early extinguishment of debt	0	(1,061)
Foreclosed real estate	1,500	1,793
Sale of other repossessed asset	1,973	84
Sale of premises and equipment	(2)	0
Originations of loans held-for-sale	(50,843)	(68,493)
Proceeds from sale of loans held-for-sale	24,653	29,347
Net (increase) decrease in:
Trading securities	(41)	(1,292)
Accrued interest receivable	(235)	(2,677)
Servicing Assets	(169)	(748)
Other assets	4,935	1,446
Net increase (decrease) in:
Accrued interest on deposits and borrowings	(1,382)	(391)
Accrued expenses and other liabilities	2,362	(2,518)
Net cash provided by (used in) operating activities	40,644	21,905
Purchases of:
Investment securities available-for-sale	(127,373)	(1,383)
FHLB stock	(48,600)	(3,150)
Maturities and Redemptions of [Abstract]
Investment securities available-for-sale	153,340	163,940
FHLB Stock	48,620	8,103
Proceeds from sale of:
Investment securities available for sale	139,152	29,062
Foreclosed real estate and other repossessed assets	13,392	6,036
Premises and equipment	10	155
Origination and purchase of loans, excluding loans held-for-sale	(161,182)	(206,229)
Principal repayment of loans, including covered loans	141,118	161,912
Reimbursements from the FDIC on shared-loss agreements	(8,236)	(6,650)
Additions to premises and equipment	(2,532)	(1,711)
Net change in securities purchased under agreements to resell	60,000	20,000
Net change in restricted cash	67,029	5,060
Net cash provided by investing activities	291,210	188,445
Net increase (decrease) in:
Deposits	(79,572)	(133,055)
Short Term Borrowings	0	(31,382)
Securities sold under agreements to repurchase	(255,000)	(203,636)
FHLB advances, federal funds purchased, and other borrowings	23,311	(91,185)
Subordinated capital notes	394	(46,541)
Exercise of stock options and restricted units lapsed, net	76	0
Purchase of treasury stock	(10,393)	0
Termination of derivative instruments	(181)	(9)
Dividends paid on preferred stock	(3,465)	(3,465)
Dividends paid on common stock	(3,657)	(2,737)
Other financing activities	0	(39)
Net cash used in financing activities	(328,487)	(512,049)
Net change in cash and cash equivalents	3,367	(301,699)
Cash and cash equivalents at beginning of period	621,269	868,695
Cash and cash equivalents at end of period	624,636	566,996
Supplemental Cash Flow Disclosure and Schedule of Non-cash Activities:
Interest paid	22,620	21,243
Income Taxes Paid	0	0
Mortgage loans securitized into mortgage-backed securities	23,228	27,679
Transfer from loans to foreclosed real estate and other repossessed assets	25,106	15,459
Reclassification of loans held-for-investment portfolio to held-for-sale portfolio	1,747	0
Reclassification of loans held-for-sale portfolio to investment portfolio	$ 33,125	$ 0

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Consolidated Statements of Financial Condition (Unaudited) (Parenthetical) (USD $)	3 Months Ended	12 Months Ended
	Mar. 31, 2014	Dec. 31, 2013
Amortized cost of trading securities	$ 2,453,000	$ 2,448,000
Amortized cost of investment securities available-for-sale	1,437,106,000	1,575,043,000
Allowance for loan and lease losses, non-covered	56,183,000	54,298,000
Allowance for loan and lease losses, covered	54,398,000	52,729,000
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, liquidation value	25	25
Common stock, par value	$ 1	$ 1
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	52,713,673	52,707,023
Common stock, shares outstanding	45,003,924	45,676,922
Treasury stock, at cost, shares	7,709,749	7,030,101
Tax effect on accumulated other comprehensive income (loss)	(87,000)	(831,000)
Series A Preferred Stock
Preferred stock, shares outstanding	1,340,000	1,340,000
Series B Preferred Stock
Preferred stock, shares outstanding	1,380,000	1,380,000
Series C Convertible Preferred Stock
Preferred stock, shares outstanding	84,000	84,000
Preferred stock, liquidation value	$ 1,000	$ 1,000
Series D Preferred Stock Member
Preferred stock, shares outstanding	960,000	960,000

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Borrowings

3 Months Ended

Mar. 31, 2014

Debt Disclosure [Abstract]

BORROWINGS

NOTE 10— BORROWINGS

Securities Sold under Agreements to Repurchase

At March 31, 2014, securities underlying agreements to repurchase were delivered to, and are being held by, the counterparties with whom the repurchase agreements were transacted. The counterparties have agreed to resell to the Company the same or similar securities at the maturity of these agreements.

At March 31, 2014and December 31, 2013, securities sold under agreements to repurchase (classified by counterparty), excluding accrued interest in the amount of $2.2millionand $2.6million, respectively,were as follows:

	March 31,				December 31,
	2014				2013
			Fair Value of				Fair Value of
	Borrowing		Underlying		Borrowing		Underlying
	Balance		Collateral		Balance		Collateral
	(In thousands)
JP Morgan Chase Bank NA		255,000		273,834		255,000		273,250
Credit Suisse Securities (USA) LLC		755,000		860,088		755,000		864,232
Deutsche Bank		-		-		255,000		272,053
Total	$	1,010,000	$	1,133,922	$	1,265,000	$	1,409,535

The following table shows a summary of the Company's repurchase agreements and their terms, excluding accrued interest in the amount of $2.2 million, at March 31, 2014:

			Weighted-
	Borrowing		Average		Maturity
Year of Maturity	Balance		Coupon	Settlement Date	Date
	(In thousands)
2014	$	85,000	0.675%	12/3/2012	12/3/2014
		85,000
2015		255,000	0.840%	12/10/2012	6/13/2015
		255,000
2016		170,000	1.500%	12/6/2012	12/8/2016
		170,000
2017		500,000	4.78%	3/2/2007	3/2/2017
	$	1,010,000	2.89%

The Company's repurchase agreement in the amount of$500 million with an original term of ten years, maturing on March 2, 2017,was modified in December 2013 to (i)eliminate the optional early termination clause that allowed the counterparty to terminate it before maturity, (ii)increase the interest rate paid by the Company from 4.67% to 4.78%; and (iii)substitute the counterparty.

The following table presents the liability associated with the repurchase transactions (excluding accrued interest), their maturities and weighted average interest rates. Also, it includes the carrying value and approximate market value of collateral (excluding accrued interest) at March 31, 2014 and December 31, 2013. The information excludes repurchase agreements transactions which were collateralized with securities or cash or which have been obtained under agreements to resell:

	March 31, 2014
					Market Value of Underlying Collateral
									CMOs		Obligations
			Weighted		FNMA and				issued by US		of US
	Repurchase		Average		FHLMC		GNMA		Government		Government
	Liability		Rate		Certificates		Certificates		Sponsored Agencies		Sponsored Agencies		Total
	(Dollars in thousands)
Over 90 days		1,010,000		2.89%		1,061,519		2,403		-		70,000		1,133,922
Total	$	1,010,000		2.89%	$	1,061,519	$	2,403	$	-	$	70,000	$	1,133,922

	December 31, 2013
					Market Value of Underlying Collateral
									CMOs		Obligations
			Weighted		FNMA and				issued by US		of US
	Repurchase		Average		FHLMC		GNMA		Government		Government
	Liability		Rate		Certificates		Certificates		Sponsored Agencies		Sponsored Agencies		Total
	(Dollars in thousands)
Within 30 days	$	255,000		0.50%	$	216,201	$	-	$	48,923	$	6,929	$	272,053
Over 90 days		1,010,000		2.89%		1,018,632		3,000		45,100		3,720		1,070,452
Total	$	1,265,000		2.41%	$	1,234,833	$	3,000	$	94,023	$	10,649	$	1,342,505

Advances from the Federal Home Loan Bank of New York

Advances are received from the FHLB-NY under an agreement whereby the Company is required to maintain a minimum amount of qualifying collateral with a fair value of at least 110% of the outstanding advances. At March 31, 2014 and December 31, 2013, these advances were secured by mortgage and commercial loans amounting to $1.2 billion and $1.3billion, respectively. Also, at March 31, 2014 and December 31, 2013 the Company had an additional borrowing capacity with the FHLB-NY of $614.1million and $674.2 million, respectively. At March 31, 2014 and December 31, 2013, the weighted average remaining maturity of FHLB's advances was 10.7months and11.3months, respectively.The original terms of these advances range between one month and seven years, and the FHLB-NY does not have the right to exercise put options at par on any advances outstanding as of March 31, 2014.

The following table shows a summary of these advances and their terms, excluding accrued interest in the amount of $327thousand,at March 31, 2014:

			Weighted-
		Borrowing	Average		Maturity
Year of Maturity		Balance	Coupon	Settlement Date	Date
		(In thousands)
2014	$	25,000	0.37%	3/4/2014	4/4/2014
		50,000	0.39%	3/10/2014	4/10/2014
		100,000	0.38%	3/17/2014	4/16/2014
		25,000	0.36%	3/24/2014	4/24/2014
		25,000	0.36%	3/31/2014	4/30/2014
		40,277	0.37%	3/3/2014	4/1/2014
		265,277
2017		4,673	1.24%	4/3/2012	4/3/2017
2018		30,000	2.19%	1/16/2013	1/16/2018
		25,000	2.18%	1/16/2013	1/16/2018
		55,000
2020		10,413	2.59%	7/19/2013	7/20/2020
	$	335,363	0.75%

All of the advances referred to above with maturity dates up to the date of this report were renewed as one-month short-term advances.

Subordinated Capital Notes

Subordinated capital notes amounted to $100.4 million at March 31, 2014 and $100.0 million at December 31, 2013.

Under the requirements of Puerto Rico Banking Act, the Bank must establish a redemption fund for the subordinated capital notes by transferring from undivided profits pre-established amounts as follows:

	Redemption fund
	(In thousands)
Redemption fund - March 31, 2014	$	48,575
2014		6,700
2015		6,700
2016		5,025
	$	67,000

Federal Funds Purchased

Federal funds purchased, presented in theunaudited consolidated statement of financial condition amounted to $23.7 millionas of March 31, 2014. The weighted average interest rate during such periodwas 0.24%.

Other borrowings

Other borrowings, presented in the unaudited consolidated statement of financial condition amounted to $3.7 million at March 31,2014and December 31, 2013, which mainly consists of unsecured fixed-rate borrowings and term notes tied to the appreciation of theS&P index. For both periods, the unsecured fixed rate borrowings amounted to $1.7 million at a fixed rate of 3.0%. The term notes tied to the S&P index amounted to $1.0million at March 31,2014 and at December 31, 2013with an index appreciation of $995 thousandand$957 thousand, respectively.

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Commitments (Narratives) (Details) (USD $)	3 Months Ended	12 Months Ended
	Mar. 31, 2014	Dec. 31, 2013
Commitments and Contingencies [Abstract]
Rent Expenses	$ 2,500,000	$ 2,700,000
Line of credit reserve	$ 900,000	$ 900,000

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Stockholders Equity (Narratives) (Details) (USD $)	3 Months Ended		12 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Weighted average stock anti dilutive effect excluded from calculation of earnings per share	254,662		653,843
Stock Repurchase Program, Authorized Amount	$ 70,000,000
Treasury Stock, Value, Acquired, Cost Method	10,393,000	0
Stock Repurchase Program Remaining Authorized Repurchase Amount	23,100,000
Stock repurchase program remaining number of shares authorized to be repurchased	1,341,002
Preferred Stock [Member]
Issuance Costs Stock	10,100,000
Common Stock [Member]
Issuance Costs Stock	$ 13,600,000

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Related Party Transactions (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Loans and Leases Receivable, Related Parties [Roll Forward]
Balance	$ 18,963	$ 3,772
New loans	0	2,435
Repayments	304	(95)
Loans And Leases Receivable Related Parties Disposal	0	(57)
Balance	$ 19,267	$ 6,055

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Document and Entity Information	3 Months Ended
	Mar. 31, 2014	Apr. 30, 2014
Document and Entity Information [Abstract]
Entity Registrant Name	OFG BANCORP
Entity Central Index Key	0001030469
Document Type	10-Q
Document Period End Date	Mar. 31, 2014
Amendment Flag	false
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	FY
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		45,011,649

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Offsetting Arrangements

3 Months Ended

Mar. 31, 2014

Offsetting [Abstract]

Balance sheet Offsetting [Text Block]

NOTE 11 – OFFSETTING OF FINANCIAL ASSETS AND LIABILITIES

The following table presents the potential effect of rights of set-off associated with the Company's recognized financial assets and liabilities at March 31, 2014 and December 31, 2013:

March 31, 2014
							Gross Amounts Not Offset in the Statement of Financial Condition
			Gross Amounts		Net Amount of
			Offset in the		Assets Presented
	Gross Amount		Statement of		in Statement				Cash
	of Recognized		Financial		of Financial		Financial		Collateral		Net
	Assets		Condition		Condition		Instruments		Received		Amount
	(In thousands)
Derivatives	$	15,861	$	-	$	15,861	$	6,814	$	-	$	9,047
Total	$	15,861	$	-	$	15,861	$	6,814	$	-	$	9,047
December 31, 2013
							Gross Amounts Not Offset in the Statement of Financial Condition
			Gross Amounts		Net amount of
			Offset in the		Assets Presented
	Gross Amount		Statement of		in Statement				Cash
	of Recognized		Financial		of Financial		Financial		Collateral		Net
	Assets		Condition		Condition		Instruments		Received		Amount
					(In thousands)
Derivatives	$	20,502	$	-	$	20,502	$	2,450	$	6,780	$	11,272
Securities purchased under agreements to resell		60,000		-		60,000		64,587		-		(4,587)
Total	$	80,502	$	-	$	80,502	$	67,037	$	6,780	$	6,685

March 31, 2014
							Gross Amounts Not Offset in the Statement of Financial Condition
					Net Amount of
			Gross Amounts		Liabilities
			Offset in the		Presented
	Gross Amount		Statement of		in Statement				Cash
	of Recognized		Financial		of Financial		Financial		Collateral		Net
	Liabilities		Condition		Condition		Instruments		Provided		Amount
					(In thousands)
Derivatives	$	25,950	$	-	$	25,950	$	-	$	2,980	$	22,970
Securities sold under agreements to repurchase		1,010,000		-		1,010,000		1,133,922		-		(123,922)
Total	$	1,035,950	$	-	$	1,035,950	$	1,133,922	$	2,980	$	(100,952)
December 31, 2013
							Gross Amounts Not Offset in the Statement of Financial Condition
					Net Amount of
			Gross Amounts		Liabilities
			Offset in the		Presented
	Gross Amount		Statement of		in Statement				Cash
	of Recognized		Financial		of Financial		Financial		Collateral		Net
	Liabilities		Condition		Condition		Instruments		Provided		Amount
	(In thousands)
Derivatives	$	30,672	$	-	$	30,672	$	-	$	2,349	$	28,323
Securities sold under agreements to repurchase		1,265,000		-		1,265,000		1,277,919		67,029		(79,948)
Total	$	1,295,672	$	-	$	1,295,672	$	1,277,919	$	69,378	$	(51,625)

The Company's derivatives are subject to agreements which allow a right of set-off with each respective counterparty. In addition, the Company's securities purchased under agreements to resell and securities sold under agreements to repurchase have a right of set-off with the respective counterparty under the supplemental terms of the Master Repurchase Agreements. In an event of default, each party has a right of set-off against the other party for amounts owed in the related agreements and any other amount or obligation owed in respect of any other agreement or transaction between them. Security collateral posted to open and maintain a master netting agreement with a counterparty, in the form of cash and securities, may from time to time be segregated in an account at a third-party custodian pursuant to a tri-party Account Control Agreement.

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Deposits and Related Interest (Interest expense) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Interest Expense Domestic Deposit Liabilities [Abstract]
Demand and saving deposits	$ 5,028	$ 5,962
Certificates of Deposits	3,950	3,973
Total	$ 8,978	$ 9,935

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Offsetting Arrangement (Liabilities Offsetting) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Offsetting Liabilities [Line Items]
Gross amount of Recognized Liabilities	$ 1,035,950	$ 1,295,672
Gross amount Offset in the Statement of Financial Condition	0	0
Net Amount of Liabilities Presented in the Statement of Financial Condition	1,035,950	1,295,672
Financial Instruments	1,133,922	1,277,919
Cash Collateral Provided	2,980	69,378
Net Amount	(100,952)	(51,625)
Derivative Financial Instruments, Liabilities [Member]
Offsetting Liabilities [Line Items]
Gross amount of Recognized Liabilities	25,950	30,672
Gross amount Offset in the Statement of Financial Condition	0	0
Net Amount of Liabilities Presented in the Statement of Financial Condition	25,950	30,672
Financial Instruments	0	0
Cash Collateral Provided	2,980	2,349
Net Amount	22,970	28,323
Securities Loaned or Sold under Agreements to Repurchase
Offsetting Liabilities [Line Items]
Gross amount of Recognized Liabilities	1,010,000	1,265,000
Gross amount Offset in the Statement of Financial Condition	0	0
Net Amount of Liabilities Presented in the Statement of Financial Condition	1,010,000	1,265,000
Financial Instruments	1,133,922	1,277,919
Cash Collateral Provided	0	67,029
Net Amount	$ (123,922)	$ (79,948)

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Consolidated Statements of Operations (Unaudited) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Interest income:
Loans Not Covered Under Shared Loss Agreements With Fdic	$ 85,243	$ 80,807
Loans Covered Under Loss Sharing Agreements	23,388	20,229
Total interest income from loans	108,631	101,036
Mortgage-backed securities	12,417	10,818
Investment securities and other	2,026	2,318
Total interest income	123,074	114,172
Interest expense:
Deposits	8,978	9,935
Securities sold under agreements to repurchase	7,411	7,248
Advances from FHLB and other borrowings	2,295	1,713
Subordinated capital notes	992	1,660
Total interest expense	19,676	20,556
Net interest income	103,398	93,616
Provision for Non Covered Loan and Lease Losses	10,062	7,916
Provision for Covered Loan and Lease Losses	1,629	672
Total provision for loan and lease losses	11,691	8,588
Net interest income after provision for loan and lease losses	91,707	85,028
Non-interest income:
Banking service revenues	10,606	11,838
Financial Service Revenues	6,867	7,660
Mortgage banking activities	1,950	3,153
Total Banking and Financial Service Revenues	19,423	22,651
FDIC shared-loss expense, net [Abstract]
FDIC shared-loss indemnification asset expense	(17,622)	(12,201)
FDIC true-up payment obligation expense	(865)	(670)
FDIC shared-loss expense, net	(18,487)	(12,871)
Net gain (loss) on:
Sale of securities	4,366	0
Derivatives	(478)	(788)
Loss on early extinguishment of repurchase agreements	0	1,061
Other	454	46
Total non-interest income, net	5,278	10,099
Non-interest expense:
Compensation and employee benefits	21,787	23,249
Professional and service fees	4,206	6,478
Occupancy and equipment	8,309	9,216
Insurance	2,074	2,678
Electronic banking charges	4,743	3,728
Information technology related expenses	1,815	2,643
Advertising, business promotion, and strategic initiatives	1,781	1,409
Merger and restructuring charges	0	5,534
Foreclosure, repossession and other real estate expenses	6,436	3,382
Loan servicing and clearing expenses	2,060	1,475
Taxes, other than payroll and income taxes	3,735	2,622
Communication	957	864
Printing, postage, stationary and supplies	554	1,166
Director and investors relations	251	236
Other	2,745	2,129
Total non-interest expense	61,453	66,809
Income before income taxes	35,532	28,318
Income tax expense (benefit)	11,785	7,126
Net income	23,747	21,192
Dividends on preferred stock	(3,465)	(3,465)
Income available to common shareholders	$ 20,282	$ 17,727
Earnings per common share:
Basic	$ 0.45	$ 0.39
Diluted	$ 0.42	$ 0.37
Average common shares outstanding and equivalents	52,598	52,892
Cash dividends per share of common stock	$ 0.08	$ 0.06

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Allowance for Loan and Lease Losses

3 Months Ended

Mar. 31, 2014

Loans Receivable [Abstract]

Allowance For Credit Losses Text Block

NOTE 5 – ALLOWANCE FOR LOAN AND LEASE LOSSES

The composition of the Company's allowance for loan and lease losses at March 31, 2014 and December 31, 2013 was as follows:

	March 31,		December 31,
	2014		2013
	(In thousands)
Allowance for loans and lease losses on non-covered loans:
Originated and other loans and leases held for investment:
Mortgage	$	19,511	$	19,937
Commercial		13,994		14,897
Consumer		7,135		6,006
Auto and leasing		8,731		7,866
Unallocated		136		375
		49,507		49,081
Acquired loans:
Accounted for under ASC 310-20 (Loans with revolving feature and/or
acquired at a premium)
Commercial		867		926
Consumer		504		-
Auto		2,247		1,428
		3,618		2,354
Accounted for under ASC 310-30 (Loans acquired with deteriorated
credit quality, including those by analogy)
Commercial		2,653		1,713
Consumer		405		418
Auto		-		732
		3,058		2,863
		56,183		54,298
Allowance for loans and lease losses on covered loans:
Loans secured by 1-4 family residential properties		14,221		12,495
Commercial and other construction		39,562		39,619
Consumer		615		615
		54,398		52,729
Total allowance for loan and lease losses	$	110,581	$	107,027

Non-Covered Loans

The Company maintains an allowance for loan and lease losses at a level that management considers adequate to provide for probable losses based upon an evaluation of known and inherent risks. The Company's allowance for loan and lease losses policy provides for a detailed quarterly analysis of probable losses. The analysis includes a review of historical loan loss experience, value of underlying collateral, current economic conditions, financial condition of borrowers and other pertinent factors. While management uses available information in estimating probable loan losses, future additions to the allowance may be required based on factors beyond the Company's control.We also maintain an allowance for loan losses on acquired loans when: (i) for loans accounted for under ASC 310-30, there is deterioration in creditquality subsequent to acquisition, and (ii) for loans accounted for under ASC 310-20, the inherent losses in the loans exceed the remaining creditdiscount recorded at the time of acquisition.As part of the Company's continuous enhancement to the allowance for loan and lease losses methodology, during the quarter ended March 31, 2014, an assessment of the look-back period and historical loss factor was performed for auto and leasing and consumer loan portfolios based on the trends observed and their relation with the economic cycle as of the period ended March 31, 2014. As a result, the period was changed to 24 months from the previously determined 12 months. This change in the allowance for loan and lease losses' look back period for the consumer and auto and leasing portfolios is considered a change in accounting estimate as per ASC 250-10 provisions, where adjustments should be made prospectively.  

Originated and Other Loans and Leases Held for Investment

The following tables present the activity in our allowance for loan and lease losses and the related recorded investment of the associatedloans for our originated and other loans held for investment portfolio by segment for the periods indicated:

	Quarter Ended March 31, 2014
							Auto and
	Mortgage		Commercial		Consumer		Leasing		Unallocated		Total
	(In thousands)
Allowance for loan and lease losses for non-covered originated and other loans:
Balance at beginning of period	$	19,937	$	14,897	$	6,006	$	7,866	$	375	$	49,081
Charge-offs		(1,214)		(419)		(838)		(4,645)		-		(7,116)
Recoveries		148		98		147		1,524		-		1,917
Provision for non-covered originated and other loan and lease losses		640		(582)		1,820		3,986		(239)		5,625
Balance at end of period	$	19,511	$	13,994	$	7,135	$	8,731	$	136	$	49,507

	March 31, 2014
	Mortgage		Commercial		Consumer		Auto and Leasing		Unallocated		Total
	(In thousands)
Allowance for loan and lease losses on non-covered originated and other loans:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	8,001	$	1,704	$	-	$	-	$	-	$	9,705
Collectively evaluated for impairment		11,510		12,290		7,135		8,731		136		39,802
Total ending allowance balance	$	19,511	$	13,994	$	7,135	$	8,731	$	136	$	49,507
Loans:
Individually evaluated for impairment	$	87,744	$	27,767	$	-	$	-	$	-	$	115,511
Collectively evaluated for impairment		694,406		1,142,378		142,492		447,940		-		2,427,216
Total ending loan balance	$	782,150	$	1,170,145	$	142,492	$	447,940	$	-	$	2,542,727

	Quarter Ended March 31, 2013
	Mortgage		Commercial		Consumer		Auto and Leasing		Unallocated		Total
	(In thousands)
Allowance for loan and lease losses for non-covered originated and other loans:
Balance at beginning of period	$	21,092	$	17,072	$	856	$	533	$	368	$	39,921
Charge-offs		(2,588)		(557)		(246)		(91)		-		(3,482)
Recoveries		-		28		65		7		-		100
Provision for (recapture of) non-covered originated and other loan and lease losses		4,385		(229)		638		1,292		(291)		5,795
Balance at end of period	$	22,889	$	16,314	$	1,313	$	1,741	$	77	$	42,334

	December 31, 2013
	Mortgage		Commercial		Consumer		Auto and Leasing		Unallocated		Total
	(In thousands)
Allowance for loan and lease losses for non-covered originated and other loans:
Ending allowance balance attributable to loans:
Individually evaluated for impairment	$	8,708	$	1,431	$	-	$	-	$	-	$	10,139
Collectively evaluated for impairment		11,229		13,466		6,006		7,866		375		38,942
Total ending allowance balance	$	19,937	$	14,897	$	6,006	$	7,866	$	375	$	49,081
Loans:
Individually evaluated for impairment	$	84,494	$	28,145	$	-	$	-	$	-	$	112,639
Collectively evaluated for impairment		681,771		1,099,512		127,744		379,874		-		2,288,901
Total ending loans balance	$	766,265	$	1,127,657	$	127,744	$	379,874	$	-	$	2,401,540

Acquired Loans Accounted for under ASC 310-20 (Loans with revolving feature and/or acquired at a premium)

The following tables present the activity in our allowance for loan losses and related recorded investment of the associated loans in our non-covered acquiredloan portfolio, excluding loans accounted for under ASC 310-30, for the quarterended March 31, 2014:

	Quarter Ended March 31, 2014
	Commercial			Consumer		Auto		Unallocated		Total
Allowance for loan and lease losses for non-covered acquired loans accounted for under ASC 310-20:
Balance at beginning of period	$	926	$ 1	$	-	$	1,428	$	-	$	2,354
Charge-offs		(174)			(2,058)		(1,296)		-		(3,528)
Recoveries		-			100		450		-		550
Provision for non-covered acquired loan and lease losses accounted for under ASC 310-20		115			2,462		1,665		-		4,242
Balance at end of period	$	867		$	504	$	2,247	$	-	$	3,618

	March 31, 2014
	Commercial		Consumer		Auto		Unallocated		Total
Allowance for loan and lease losses on non-covered acquired loans accounted for under ASC 310-20:
Ending allowance balance attributable to loans:
Collectively evaluated for impairment		867		504		2,247		-		3,618
Total ending allowance balance	$	867	$	504	$	2,247	$	-	$	3,618
Loans:
Collectively evaluated for impairment		71,577		52,049		268,865		-		392,491
Total ending loan balance	$	71,577	$	52,049	$	268,865	$	-	$	392,491

	Quarter Ended March 31, 2013
	Commercial			Consumer		Auto		Unallocated		Total
Allowance for loan and lease losses for non-covered acquired loans accounted for under ASC 310-20:
Balance at beginning of period	$	-	$ 1	$	-	$	-	$	-	$	-
Charge-offs		-			(1,456)		(1,715)		-		(3,171)
Recoveries		-			207		1,230		-		1,437
Provision for non-covered acquired loan and lease losses accounted for under ASC 310-20		386			1,249		485		-		2,120
Balance at end of period	$	386		$	-	$	-	$	-	$	386

	December 31, 2013
	Commercial		Consumer		Auto		Unallocated		Total
Allowance for loan and lease losses on non-covered acquired loans accounted for under ASC 310-20:
Ending allowance balance attributable to loans:
Collectively evaluated for impairment		926		-		1,428		-		2,354
Total ending allowance balance	$	926	$	-	$	1,428	$	-	$	2,354
Loans:
Collectively evaluated for impairment		77,681		56,174		301,584		-		435,439
Total ending loan balance	$	77,681	$	56,174	$	301,584	$	-	$	435,439

Acquired Loans Accounted for under ASC 310-30 (including those accounted for under ASC 310-30 by analogy)

The following tables present the activity in our allowance for loan losses and related recorded investment of the associated loans in our non-covered acquiredloan portfolio accounted for under ASC 310-30, for the quarterended March 31, 2014:

	Quarter Ended March 31, 2014
	Mortgage			Commercial			Construction			Consumer		Auto		Total
Allowance for loan and lease losses for non-covered loans accounted for under ASC 310-30:
Balance at beginning of period	$	-	$ 1	$	1,713	$ 1	$	-	$ 1	$	418	$	732	$	2,863
Provision for non-covered acquired loan and lease losses accounted for under ASC 310-30		-			940			-			(13)		(732)		195
Balance at end of period	$	-		$	2,653		$	-		$	405	$	-	$	3,058

Non-covered loans acquired accounted for under ASC 310-30 were recognized at fair value as of December 18, 2012, which included the impact of expected credit losses and, therefore, no allowance for credit losses was recorded during the quarter ended March 31, 2013.

Impaired Loans

The Company evaluates all loans, some individually and others as homogeneous groups, for purposes of determining impairment. The total investment in impaired commercial loans was $27.8million and $28.1million at March 31, 2014 and December 31, 2013,respectively. The impaired commercial loans were measured based on the fair value of collateral or the present value of cash flows, including those identified as troubled-debt restructurings. The valuation allowance for impaired commercial loans amounted to approximately $1.4 millionatMarch 31, 2014 and December 31, 2013. The total investment in impaired mortgage loans was $87.7 millionand $84.5 million at March 31, 2014 and December 31, 2013, respectively. Impairment on mortgage loans assessed as troubled-debt restructurings was measured using the present value of cash flows. The valuation allowance for impaired mortgage loans amounted to approximately $8.0 million and $8.7 million at March 31, 2014 and December 31,2013, respectively.

The Company's recorded investment in commercial and mortgage loans that were individually evaluated forimpairment, excluding loans accounted for under ASC 310-30, and the related allowance for loan and lease losses at March 31, 2014 and December 31, 2013are as follows:

Originated and Other Loans and Leases Held for Investment

	March 31, 2014
	Unpaid		Recorded		Related
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired loans with specific allowance:
Commercial	$	7,856	$	6,686	$	1,704	25%
Residential troubled-debt restructuring		92,870		87,744		8,002	9%
Impaired loans with no specific allowance:
Commercial		26,744		21,081		N/A	N/A
Total investment in impaired loans	$	127,470	$	115,511	$	9,706	8%

	December 31, 2013
	Unpaid		Recorded		Related
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired loans with specific allowance
Commercial	$	6,600	$	5,553	$	1,431	26%
Residential troubled-debt restructuring		89,539		84,494		8,708	10%
Impaired loans with no specific allowance
Commercial		27,914		22,592		N/A	N/A
Total investment in impaired loans	$	124,053	$	112,639	$	10,139	9%

Acquired Loans Accounted for under ASC-310-20 (Loans with revolving feature and/or acquired at a premium)
	March 31, 2014
	Unpaid		Recorded		Related
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired loans with no specific allowance
Commercial		208		208		N/A	N/A
Total investment in impaired loans	$	208	$	208	$	-	0%
	December 31, 2013
	Unpaid		Recorded		Specific
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired loans with no specific allowance
Commercial		208		208		N/A	N/A
Total investment in impaired loans	$	208	$	208	$	-	0%

Acquired Loans Accounted for under ASC 310-30 (including those accounted for under ASC 310-30 by analogy)

The Company's recorded investment in non-covered acquired loan pools accounted for under ASC 310-30 and their related allowance for non-covered loan and lease losses at March 31, 2014 and December 31, 2013are as follows:

	March 31, 2014
	Unpaid		Recorded
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired non-covered loan pools:
Mortgage	$	5,008	$	4,510	$	57	1%
Commercial		89,496		78,742		879	1%
Construction		46,256		40,397		1,773	4%
Consumer		61,584		53,307		349	1%
Total investment in impaired non-covered loan pools	$	202,344	$	176,956	$	3,058	2%

	December 31, 2013
	Unpaid		Recorded
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired non-covered loan pools:
Mortgage	$	5,183	$	4,718	$	57	1%
Commercial		48,100		40,411		394	1%
Construction		21,526		17,818		1,319	7%
Consumer		73,043		63,606		361	1%
Auto		379,236		377,316		732	0%
Total investment in impaired non-covered loan pools	$	527,088	$	503,869	$	2,863	1%

The following table presents the interest recognized in commercial and mortgage loans that were individuallyevaluated for impairment, excluding loans accounted for under ASC 310-30, for the quartersended March 31, 2014 and 2013:

	Quarter Ended March 31,
	2014				2013
	Interest Income Recognized		Average Recorded Investment		Interest Income Recognized		Average Recorded Investment
	(In thousands)
Impaired loans with specific allowance
Commercial	$	24	$	6,259	$	4	$	15,472
Residential troubled-debt restructuring		645		87,052		443		78,748
Impaired loans with no specific allowance
Commercial		78		21,629		293		30,360
Total interest income from impaired loans	$	747	$	114,940	$	740	$	124,580

Modifications

The following table presents the troubled-debt restructurings during the quarters ended March 31, 2014 and 2013:

	Quarter Ended March 31, 2014
	Number of contracts	Pre-Modification Outstanding Recorded Investment		Pre-Modification Weighted Average Rate	Pre-Modification Weighted Average Term (in Months)	Post-Modification Outstanding Recorded Investment		Post-Modification Weighted Average Rate	Post-Modification Weighted Average Term (in Months)
	(Dollars in thousands)
Mortgage	34	$	4,009	6.43%	347	$	3,910	4.35%	375
Consumer	5		42	12.97%	67		44	12.95%	66
	Quarter Ended March 31, 2013
	Number of contracts	Pre- Modification Outstanding Recorded Investment		Pre-Modification Weighted Average Rate	Pre-Modification Weighted Average Term (in Months)	Post-Modification Outstanding Recorded Investment		Post-Modification Weighted Average Rate	Post-Modification Weighted Average Term (in Months)
	(Dollars in thousands)
Mortgage	57	$	7,518	6.28%	331	$	8,040	4.35%	409

The following table presents troubled-debt restructurings for which there was a payment default during the twelve-month period endedMarch 31, 2014 and 2013:

	Twelve-Month Period Ended March 31,
	2014			2013
	Number of Contracts	Recorded Investment		Number of Contracts	Recorded Investment
	(Dollars in thousands)
Mortgage	19	$	2,592	32	$	4,295
Commercial	-	$	-	1	$	18
Consumer	1	$	11	-	$	-

Credit Quality Indicators

The Company categorizes non-covered originated and acquired loans accounted for under ASC 310-20 into risk categories based on relevant information about the ability ofborrowers to service their debt, such as economic conditions, portfolio risk characteristics, prior lossexperience,and the results of periodic credit reviews of individual loans.

The Company uses the following definitions for risk ratings:

Special Mention: Loans classified as “special mention” have a potential weakness that deservesmanagement's close attention. If left uncorrected, these potential weaknesses may result in deterioration ofthe repayment prospects for the loan or of the institution's credit position at some future date.

Substandard: Loans classified as “substandard” are inadequately protected by the current net worthand paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a welldefinedweakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by thedistinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful: Loans classified as “doubtful” have all the weaknesses inherent in those classified assubstandard, with the added characteristic that the weaknesses make collection or liquidation in full, on thebasis of currently existing facts, conditions, and values, questionable and improbable.

Loss: Loans classified as “loss” are considered uncollectible and of such little value that their continuanceas bankable assets is not warranted. This classification does not mean that the asset has absolutely norecovery or salvage value, but rather that it is not practical or desirable to defer writing off this worthlessloan even though partial recovery may be effected in the future.

Loans not meeting the criteria above that are analyzed individually as part of the above described process areconsidered to be pass rated loans.

As of March 31,2014 and December 31, 2013, and based on the most recent analysis performed, the risk category of gross non-covered originated and other loans and acquiredloans accounted for under ASC 310-20 subject to risk rating by class of loans is as follows:

	March 31, 2014
	Risk Ratings
											Individually
	Balance				Special						Measured for
	Outstanding		Pass		Mention		Substandard		Doubtful		Impairment
	(In thousands)
Commercial - originated and other loans held for investment
Commercial secured by real estate:
Corporate	$	62,935	$	62,935	$	-	$	-	$	-	$	-
Institutional		9,833		9,833		-		-		-		-
Middle market		169,753		141,537		16,619		-		-		11,597
Retail		156,694		139,971		1,929		1,892		-		12,902
Floor plan		1,699		1,699		-		-		-		-
Real estate		11,837		11,837		-		-		-		-
		412,751		367,812		18,548		1,892		-		24,499
Other commercial and industrial:
Corporate		28,475		28,475		-		-		-		-
Institutional		553,249		553,249		-		-		-		-
Middle market		82,933		77,566		3,336		771		-		1,260
Retail		67,055		63,366		119		1,562		-		2,008
Floor plan		25,682		25,372		202		108		-		-
		757,394		748,028		3,657		2,441		-		3,268
Total		1,170,145		1,115,840		22,205		4,333		-		27,767
Commercial - acquired loans (under ASC 310-20)
Commercial secured by real estate:
Corporate		11,079		11,079		-		-		-		-
Retail		4,301		3,490		245		566		-		-
Floor plan		2,752		2,651		-		101		-		-
		18,132		17,220		245		667		-		-
Other commercial and industrial:
Corporate		2,947		2,851		-		96		-		-
Institutional		221		221		-		-		-		-
Retail		17,216		16,460		100		656		-		-
Floor plan		33,061		32,998		63		-		-		-
		53,445		52,530		163		752		-		-
Total		71,577		69,750		408		1,419		-		-
Total	$	1,241,722	$	1,185,590	$	22,613	$	5,752	$	-	$	27,767

	December 31, 2013
	Risk Ratings
											Individually
	Balance				Special						Measured for
	Outstanding		Pass		Mention		Substandard		Doubtful		Impairment
	(In thousands)
Commercial - originated and other loans held for investment
Commercial secured by real estate:
Corporate	$	54,796	$	54,796	$	-	$	-	$	-	$	-
Institutional		4,050		4,050		-		-		-		-
Middle market		161,583		133,061		16,627		118		-		11,777
Retail		166,642		149,018		2,182		2,258		-		13,184
Floor plan		1,835		1,835		-		-		-		-
Real estate		11,655		11,655		-		-		-		-
		400,561		354,415		18,809		2,376		-		24,961
Other commercial and industrial:
Corporate		32,598		32,598		-		-		-		-
Institutional		536,445		536,445		-		-		-		-
Middle market		58,897		53,868		3,466		198		-		1,365
Retail		61,510		58,742		257		691		-		1,820
Floor plan		37,646		37,350		188		108		-		-
		727,096		719,003		3,911		997		-		3,185
Total		1,127,657		1,073,418		22,720		3,373		-		28,146
Commercial - acquired loans (under ASC 310-20)
Commercial secured by real estate:
Corporate		10,166		10,166		-		-		-		-
Retail		5,770		4,378		443		949		-		-
Floor plan		2,677		2,576		-		101		-		-
		18,613		17,120		443		1,050		-		-
Other commercial and industrial:
Corporate		9,793		9,696		-		97		-		-
Retail		27,338		26,044		150		1,144		-		-
Floor plan		21,937		21,769		168		-		-		-
		59,068		57,509		318		1,241		-		-
Total		77,681		74,629		761		2,291		-		-
Total	$	1,205,338	$	1,148,047	$	23,481	$	5,664	$	-	$	28,146

At March 31, 2014 and December 31, 2013, we had approximately $766.7millionand $763.4 million, respectively,of credit facilities granted to the Puerto Rico government, including its instrumentalities, public corporations and municipalities, of which $718.8millionand $696.0, respectively, were outstanding as of such dates.A substantial portion of our credit exposure to the government of Puerto Rico consists of collateralized loans or obligations that have a specific source of income or revenues identified for its repayment. Some of these obligations consist of senior and subordinated loans to public corporations that obtain revenues from rates charged for services,such as water and electric power utilities. Public corporations have varying degrees of independence from the central government and many receive appropriations or other payments from it. We also have loans to various municipalities for which the good faith, credit and unlimited taxing power of the applicable municipality has been pledged to their repayment.These municipalities are required by law to levy special property taxes in such amounts as shall be required for the payment of all their general obligation bonds and notes. Another portion of these loans consists of special obligations of various municipalities that are payable from the basic real and personal property taxes collected within such municipalities.The good faith and credit obligations of the municipalities have a first lien on the basic property taxes.

For residential and consumer loan classes, the Company evaluates credit quality based on the delinquency status of the loan. As of March 31, 2014 and December 31, 2013, and based on the most recent analysis performed, the risk category of non-covered gross originated and other loans and acquired loans accounted for under ASC 310-20 not subject to risk rating by class of loans is as follows:

	March 31, 2014
	Delinquency
																Individually
	Balance															Measured for
	Outstanding		0-29 days		30-59 days		60-89 days			90-119 days		120-364 days		365+ days		Impairment
	(In thousands)
Originated and other loans and leases held for investment
Mortgage
Traditional (by origination year)
Up to the year 2002	$	72,096	$	61,268	$	5,230	$	2,621		$	382	$	1,037	$	1,459	$	99
Years 2003 and 2004		63,515		53,170		5,494		2,445			484		1,246		612		64
Year 2005		87,818		72,414		6,448		2,288			1,233		3,576		1,324		535
Year 2006		116,904		97,822		10,151		4,376			1,169		2,410		850		126
Years 2007, 2008 and 2009		97,840		87,065		3,807		2,025			223		3,619		875		226
Years 2010, 2011, 2012 2013 and 2014		182,167		164,134		2,126		721			1,070		1,004		1,064		12,048
		620,340		535,873		33,256		14,476			4,561		12,892		6,184		13,098
Non-traditional		39,790		35,078		1,744		470			-		1,439		986		73
Loss mitigation program		86,005		8,366		1,001		171			219		779		896		74,573
		746,135		579,317		36,001		15,117			4,780		15,110		8,066		87,744
Home equity secured personal loans		733		595		-		-	-		-		126		12		-
GNMA's buy-back option program		35,282		-		-		-	-		5,529		16,742		13,011		-
		782,150		579,912		36,001		15,117			10,309		31,978		21,089		87,744
Consumer
Credit cards		15,490		14,701		263		171			136		219		-		-
Overdrafts		331		289		28		11			1		2		-		-
Unsecured personal lines of credit		1,934		1,718		60		99			15		35		7		-
Unsecured personal loans		108,037		105,369		1,397		512			195		42		12		510
Cash collateral personal loans		16,700		16,263		375		46			13		3		-		-
		142,492		138,340		2,123		839			360		301		19		510
Auto and Leasing		447,940		399,721		33,788		8,559			3,461		2,411		-		-
		1,372,582		1,117,973		71,912		24,515			14,130		34,690		21,108		88,254
Acquired loans (accounted for under ASC 310-20)
Consumer
Credit cards		48,381		44,111		1,413		781			743		1,333		-		-
Personal loans		3,668		3,423		105		83			4		53		-		-
		52,049		47,534		1,518		864			747		1,386		-		-
Auto		268,865		250,840		13,161		3,522			804		538		-		-
		320,914		298,374		14,679		4,386			1,551		1,924		-		-
Total	$	1,693,496	$	1,416,347	$	86,591	$	28,901		$	15,681	$	36,614	$	21,108	$	88,254

	December 31, 2013
	Delinquency
																Individually
	Balance															Measured for
	Outstanding		0-29 days		30-59 days		60-89 days			90-119 days		120-364 days		365+ days		Impairment
	(In thousands)
Originated and other loans and leases held for investment
Mortgage
Traditional (by origination year)
Up to the year 2002	$	76,512	$	64,743	$	6,594	$	1,634		$	868	$	1,082	$	1,458	$	133
Years 2003 and 2004		65,117		56,283		4,722		1,938			56		1,437		352		329
Year 2005		89,541		74,016		8,414		2,119			1,198		3,037		573		184
Year 2006		120,322		99,243		12,055		4,312			1,148		2,755		515		294
Years 2007, 2008 and 2009		101,150		91,920		3,464		1,104			1,264		2,844		554		-
Years 2010, 2011, 2012 and 2013		149,546		134,577		3,192		1,609			115		974		989		8,090
		602,188		520,782		38,441		12,716			4,649		12,129		4,441		9,030
Non-traditional		42,102		35,168		3,217		1,162			-		1,324		833		398
Loss mitigation program		86,318		7,762		1,376		149			624		312		1,029		75,066
		730,608		563,712		43,034		14,027			5,273		13,765		6,303		84,494
Home equity secured personal loans		736		598		-		-	-		-		126		12		-
GNMA's buy-back option program		34,921		-		-		-	-		7,670		14,425		12,826		-
		766,265		564,310		43,034		14,027			12,943		28,316		19,141		84,494
Consumer
Credit cards		15,241		14,555		287		168			118		113		-		-
Overdrafts		372		322		46		4			-		-		-		-
Unsecured personal lines of credit		1,981		1,844		33		38			25		34		7		-
Unsecured personal loans		94,560		92,102		1,272		399			300		39		13		435
Cash collateral personal loans		15,590		15,223		324		43			-		-		-		-
		127,744		124,046		1,962		652			443		186		20		435
Auto and Leasing		379,874		339,817		25,532		9,437			3,397		1,691		-		-
		1,273,883		1,028,173		70,528		24,116			16,783		30,193		19,161		84,929
Acquired loans (accounted for under ASC 310-20)
Consumer
Credit cards		52,199		46,713		2,217		1,200			828		1,241		-		-
Personal loans		3,975		3,681		196		7			60		31		-		-
		56,174		50,394		2,413		1,207			888		1,272		-		-
Auto		301,584		283,825		12,534		3,616			1,095		514		-		-
		357,758		334,219		14,947		4,823			1,983		1,786		-		-
Total	$	1,631,641	$	1,362,392	$	85,475	$	28,939		$	18,766	$	31,979	$	19,161	$	84,929

Covered Loans

For covered loans, as part of the evaluation of actual versus expected cash flows, the Company assesses on a quarterly basis the credit quality of these loans based on delinquency, severity factors and risk ratings, among other assumptions. Migration and credit quality trends are assessed at the pool level, by comparing information from the latest evaluation period through the end of the reporting period.

The changes in the allowance for loan and lease losses on covered loans for the quartersended March 31, 2014and 2013 were as follows:

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Balance at beginning of the period	$	52,729	$	54,124
Provision for covered loan and lease losses, net		1,629		672
FDIC shared-loss portion of provision for (recapture of)
covered loan and lease losses, net		40		(1,822)
Balance at end of the period	$	54,398	$	52,974

FDIC shared-loss portion of provision for (recapture of) covered loans and lease losses net,represents the credit impairment losses to be covered under the FDIC loss-share agreement which is increasing (decreasing) the FDIC loss-share indemnification asset.

Net provision for covered loans includes both additional reserves and reserve releases for different pools. The pools for which there were releases are also subject to a reduction to the FDIC shared-loss indemnification asset because of lower expected losses which are recognized as recaptures.

The Company's recorded investment in covered loan pools that have recorded impairments and their relatedallowance for covered loan and lease losses as of March 31, 2014 and December 31, 2013 are as follows:

	March 31, 2014
	Unpaid		Recorded
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired covered loan pools:
Loans secured by 1-4 family residential properties	$	147,597	$	111,410	$	14,221	13%
Construction and development secured by 1-4 family residential properties		65,747		18,254		6,866	38%
Commercial and other construction		192,095		111,679		32,696	29%
Consumer		9,671		5,503		615	11%
Total investment in impaired covered loan pools	$	415,110	$	246,846	$	54,398	22%

	December 31, 2013
	Unpaid		Recorded		Specific
	Principal		Investment		Allowance		Coverage
	(In thousands)
Impaired covered loan pools with specific allowance
Loans secured by 1-4 family residential properties	$	52,142	$	38,179	$	12,495	33%
Construction and development secured by 1-4 family residential properties		66,037		17,304		6,866	40%
Commercial and other construction		209,566		111,946		32,753	29%
Consumer		10,512		5,857		615	11%
Total investment in impaired covered loan pools	$	338,257	$	173,286	$	52,729	30%

XML

Loans

3 Months Ended

Mar. 31, 2014

Loans Receivable [Abstract]

LOANS RECEIVABLE

NOTE 4- LOANS

The Company's loan portfolio is composed of covered loans and non-covered loans. The Company presents loans subject to the loss sharing agreements as “covered loans” in the tables below, and loans that are not subject to FDIC loss sharing agreements as “non-covered loans.” The risks of the FDIC-assisted Eurobankacquisition acquired loans are different from those loans not covered under the FDIC loss sharing agreements because of the loss protection provided by the FDIC. Also, loans acquired in the BBVAPR Acquisition are included as non-covered loans in theunaudited consolidated statements of financial condition. Non-covered loans are further segregated between originated and other loans, acquired loans accounted for under ASC 310-20 (loans with revolving feature and/or acquired at a premium),and acquired loans accounted for under ASC 310-30 (loans acquired with deteriorated credit quality, including those by analogy).

The composition of the Company's loan portfolio at March 31, 2014 and December 31,2013 was as follows:

	March 31,		December 31,
	2014		2013
	(In thousands)
Loans not covered under shared-loss agreements with FDIC:
Originated and other loans and leases held for investment:
Mortgage	$	782,150	$	766,265
Commercial		1,170,145		1,127,657
Consumer		142,492		127,744
Auto and leasing		447,940		379,874
		2,542,727		2,401,540
Acquired loans:
Accounted for under ASC 310-20 (Loans with revolving feature and/or
acquired at a premium)
Commercial		71,577		77,681
Consumer		52,049		56,174
Auto		268,865		301,584
		392,491		435,439
Accounted for under ASC 310-30 (Loans acquired with deteriorated
credit quality, including those by analogy)
Mortgage		703,454		717,904
Commercial		532,695		545,117
Construction		122,693		126,427
Consumer		53,310		63,620
Auto		341,889		379,145
		1,754,041		1,832,213
		4,689,259		4,669,192
Deferred loan cost , net		2,318		1,035
Loans receivable		4,691,577		4,670,227
Allowance for loan and lease losses on non-covered loans		(56,183)		(54,298)
Loans receivable, net		4,635,394		4,615,929
Mortgage loans held-for-sale		19,355		46,529
Total loans not covered under shared-loss agreements with FDIC, net		4,654,749		4,662,458
Loans covered under shared-loss agreements with FDIC:
Loans secured by 1-4 family residential properties		124,239		121,748
Construction and development secured by 1-4 family residential properties		18,254		17,304
Commercial and other construction		253,804		264,249
Consumer		5,769		6,119
Leasing		197		270
Total loans covered under shared-loss agreements with FDIC		402,263		409,690
Allowance for loan and lease losses on covered loans		(54,398)		(52,729)
Total loans covered under shared-loss agreements with FDIC, net		347,865		356,961
Total loans, net	$	5,002,614	$	5,019,419

Non-covered Loans

Originated and Other Loans and Leases Held for Investment

The Company's originated and other loans held for investment areencompassed within four portfolio segments: mortgage, commercial, consumer, andauto and leasing.

The following tables present the aging of the recorded investment in gross originated and other loans held for investment as of March 31,2014 and December 31, 2013 by class ofloans. Mortgage loans past due included delinquent loans in the GNMA buy-back option program. Servicers of loans underlying GNMA mortgage-backed securities must report as their own assets the defaulted loans that they have the option (but not the obligation) to repurchase, even when they elect not to exercise that option.

	March 31, 2014
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Mortgage
Traditional (by origination year):
Up to the year 2002	$	5,330	$	2,620	$	2,877	$	10,827	$	61,269	$	72,096	$	91
Years 2003 and 2004		5,494		2,445		2,342		10,281		53,234		63,515		-
Year 2005		6,620		2,288		6,289		15,197		72,621		87,818		-
Year 2006		10,151		4,376		4,474		19,001		97,903		116,904		-
Years 2007, 2008 and 2009		3,807		2,025		4,850		10,682		87,158		97,840		-
Years 2010, 2011, 2012, 2013 and 2014		3,890		1,122		4,939		9,951		172,216		182,167		167
		35,292		14,876		25,771		75,939		544,401		620,340		258
Non-traditional		1,744		470		2,425		4,639		35,151		39,790		-
Loss mitigation program		8,149		6,485		12,559		27,193		58,812		86,005		2,254
		45,185		21,831		40,755		107,771		638,364		746,135		2,512
Home equity secured personal loans		-		-		138		138		595		733		-
GNMA's buy-back option program		-		-		35,282		35,282		-		35,282		-
		45,185		21,831		76,175		143,191		638,959		782,150		2,512
Commercial
Commercial secured by real estate:
Corporate		-		-		-		-		62,935		62,935		-
Institutional		-		-		-		-		9,833		9,833		-
Middle market		-		-		1,531		1,531		168,222		169,753		-
Retail		1,241		277		4,780		6,298		150,396		156,694		-
Floor plan		-		-		-		-		1,699		1,699		-
Real estate		-		-		-		-		11,837		11,837		-
		1,241		277		6,311		7,829		404,922		412,751		-
Other commercial and industrial:
Corporate		-		-		-		-		28,475		28,475		-
Institutional		-		-		-		-		553,249		553,249		-
Middle market		-		-		513		513		82,420		82,933		-
Retail		609		292		1,622		2,523		64,532		67,055		-
Floor plan		-		-		-		-		25,682		25,682		-
		609		292		2,135		3,036		754,358		757,394		-
		1,850		569		8,446		10,865		1,159,280		1,170,145		-

	March 31, 2014
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Consumer
Credit cards		263		171		354		788		14,702		15,490		-
Overdrafts		28		11		4		43		288		331		-
Personal lines of credit		60		99		57		216		1,718		1,934		-
Personal loans		1,418		524		248		2,190		105,847		108,037		-
Cash collateral personal loans		375		46		16		437		16,263		16,700		-
		2,144		851		679		3,674		138,818		142,492		-
Auto and leasing		33,788		8,559		5,872		48,219		399,721		447,940		-
Total	$	82,967	$	31,810	$	91,172	$	205,949	$	2,336,778	$	2,542,727	$	2,512

	December 31, 2013
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Mortgage
Traditional (by origination year):
Up to the year 2002	$	6,697	$	1,635	$	3,408	$	11,740	$	64,772	$	76,512	$	79
Years 2003 and 2004		4,722		2,163		1,845		8,730		56,387		65,117		-
Year 2005		8,527		2,119		4,808		15,454		74,087		89,541		-
Year 2006		12,055		4,312		4,418		20,785		99,537		120,322		-
Years 2007, 2008 and 2009		3,464		1,104		4,663		9,231		91,919		101,150		152
Years 2010, 2011, 2012 and 2013		3,923		1,609		4,453		9,985		139,561		149,546		459
		39,388		12,942		23,595		75,925		526,263		602,188		690
Non-traditional		3,217		1,162		2,311		6,690		35,412		42,102		-
Loss mitigation program		9,759		5,560		13,191		28,510		57,808		86,318		2,185
		52,364		19,664		39,097		111,125		619,483		730,608		2,875
Home equity secured personal loans		-		-		138		138		598		736		-
GNMA's buy-back option program		-		-		34,921		34,921		-		34,921		-
		52,364		19,664		74,156		146,184		620,081		766,265		2,875
Commercial
Commercial secured by real estate:
Corporate		-		-		-		-		54,796		54,796		-
Institutional		-		-		-		-		4,050		4,050		-
Middle market		1,356		-		10,294		11,650		149,933		161,583		-
Retail		4,253		1,015		3,190		8,458		158,184		166,642		-
Floor plan		-		-		-		-		1,835		1,835		-
Real estate		-		-		-		-		11,655		11,655		-
		5,609		1,015		13,484		20,108		380,453		400,561		-
Other commercial and industrial:
Corporate		236		-		-		236		32,362		32,598		-
Institutional		-		-		-		-		536,445		536,445		-
Middle market		-		299		1,134		1,433		57,464		58,897		-
Retail		1,830		552		539		2,921		58,589		61,510		-
Floor plan		39		-		-		39		37,607		37,646		-
		2,105		851		1,673		4,629		722,467		727,096		-
		7,714		1,866		15,157		24,737		1,102,920		1,127,657		-

	December 31, 2013
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Consumer
Credit cards		287		168		232		687		14,554		15,241		-
Overdrafts		46		4		-		50		322		372		-
Personal lines of credit		33		38		66		137		1,844		1,981		-
Personal loans		1,324		399		352		2,075		92,485		94,560		-
Cash collateral personal loans		324		43		-		367		15,223		15,590		-
		2,014		652		650		3,316		124,428		127,744		-
Auto and leasing		25,531		9,437		5,089		40,057		339,817		379,874		-
Total	$	87,623	$	31,619	$	95,052	$	214,294	$	2,187,246	$	2,401,540	$	2,875

At March 31, 2014, the increase in delinquencies in the consumer and the auto and leasing portfolios compared to December 31, 2013 is mainly attributed to the fact that non-performing loans of acquired non-covered loan portfolio were accounted for under ASC 310-30. At March 31, 2014 such portfolios are increasing as new originations are ramping up the balances outstanding.More than a year from the acquisition, those portfolios are beginning to reflect normal delinquency levels as seasoned portfolios.

At March 31, 2014, the Company had $539.9 million in loans granted to the Puerto Rico government, including its instrumentalities, public corporations and municipalities as part of the institutional commercial loan segment. This entire amount was current at March 31, 2014.

Acquired Loans Accounted for under ASC 310-20 (Loans with revolving feature and/or acquired at a premium)

Credit cards, retail and commercial revolving lines of credits, floor plans and performing auto loans with FICO scores over 660 acquired at a premiumas part of the non-covered portfolio are accounted for under the guidance of ASC 310-20, which requires that any contractually required loan payment receivable in excess of the Company's initial investment in the loans be accreted into interest income on a level-yield basis over the life of the loan. Loans accounted for under ASC 310-20 are placed on non-accrual status when past due in accordance with the Company's non-accrual policyand any accretion of discount or amortization of premium is discontinued. Loans acquired in the non-covered portfolio that were accounted for under the provisions of ASC 310-20 are removed from the acquired loan categoryat the end of the reporting periodupon refinancing, renewal or normal re-underwriting.

The following table presents the aging of the recorded investment in gross acquired loans accounted for under ASC 310-20 as of March 31,2014 and December 31, 2013, by class ofloans:

	March 31, 2014
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Commercial
Commercial secured by real estate
Corporate	$	-	$	-	$	-	$	-	$	11,079	$	11,079	$	-
Retail		47		-		603		650		3,651		4,301		-
Floor plan		-		-		101		101		2,651		2,752		-
		47		-		704		751		17,381		18,132		-
Other commercial and industrial
Corporate		14		-		82		96		2,851		2,947		-
Institutional		-		-		-		-		221		221		-
Retail		645		128		716		1,489		15,727		17,216		-
Floor plan		84		-		126		210		32,851		33,061		-
		743		128		924		1,795		51,650		53,445		-
		790		128		1,628		2,546		69,031		71,577		-
Consumer
Credit cards		1,413		781		2,078		4,272		44,109		48,381		-
Personal loans		105		83		57		245		3,423		3,668		-
		1,518		864		2,135		4,517		47,532		52,049		-
Auto		13,161		3,522		1,342		18,025		250,840		268,865		-
Total	$	15,469	$	4,514	$	5,105	$	25,088	$	367,403	$	392,491	$	-

	December 31, 2013
													Loans 90+
													Days Past
													Due and
	30-59 Days		60-89 Days		90+ Days		Total Past						Still
	Past Due		Past Due		Past Due		Due		Current		Total Loans		Accruing
	(In thousands)
Commercial
Commercial secured by real estate
Corporate	$	-	$	-	$	-	$	-	$	10,166	$	10,166	$	-
Retail		431		331		868		1,630		4,140		5,770		-
Floor plan		-		-		101		101		2,576		2,677		-
		431		331		969		1,731		16,882		18,613		-
Other commercial and industrial
Corporate		14		83		-		97		9,696		9,793		-
Retail		1,717		1,418		659		3,794		23,544		27,338		-
Floor plan		35		193		18		246		21,691		21,937		-
		1,766		1,694		677		4,137		54,931		59,068		-
		2,197		2,025		1,646		5,868		71,813		77,681		-
Consumer
Credit cards		2,217		1,200		2,068		5,485		46,714		52,199		-
Personal loans		196		7		91		294		3,681		3,975		-
		2,413		1,207		2,159		5,779		50,395		56,174		-
Auto		12,534		3,616		1,608		17,758		283,826		301,584		-
Total	$	17,144	$	6,848	$	5,413	$	29,405	$	406,034	$	435,439	$	-

Acquired Loans Accounted for under ASC 310-30 (including those accounted for under ASC 310-30 by analogy)

Loans acquired as part of the non-covered portfolio, except for credit cards, retail and commercial revolving lines of credits, floor plans and performing auto loans with FICO scores over 660 acquired at a premium,are accounted for by the Company in accordance with ASC 310-30.

The carrying amount corresponding to non-covered loans acquired with deteriorated credit quality, including those accounted under ASC 310-30 by analogy, in the statements of financial condition at March 31,2014 and December 31, 2013 is as follows:

	March 31,	December 31,
	2014	2013
	(In thousands)
Contractual required payments receivable	$ 2,799,336	$ 2,929,353
Less: Non-accretable discount	563,294	579,587
Cash expected to be collected	2,236,042	2,349,766
Less: Accretable yield	482,001	517,553
Carrying amount	$ 1,754,041	$ 1,832,213

At March 31, 2014 and December 31, 2013, the Company had $196.1millionand $180.5 million, respectively, in loans granted to the Puerto Rico government, including its instrumentalities, public corporations and municipalities as part of its non-covered acquired loans accounted for under ASC 310-30.

The following tables describe the accretable yield and non-accretable discount activity of acquired loans accounted for under ASC 310-30 for the quartersended March 31, 2014 and 2013

	Quarter Ended March 31,
	2014		2013
Accretable Yield Activity
Balance at beginning of period	$	517,553	$	655,833
Accretion		(40,269)		(47,668)
Transfer from non-accretable discount		4,717		-
Balance at end of period	$	482,001	$	608,165
	Quarter Ended March 31,
	2014		2013
Non-Accretable Discount Activity
Balance at beginning of period	$	579,587	$	714,462
Principal losses		(11,576)		(8,746)
Transfer to accretable yield		(4,717)		-
Balance at end of period	$	563,294	$	705,716

Covered Loans

The carrying amount of covered loans at March 31, 2014 and December 31, 2013is as follows:

	March 31,		December 31,
	2014		2013
	(In thousands)
Contractual required payments receivable	$	657,353	$	702,126
Less: Non-accretable discount		107,323		129,477
Cash expected to be collected		550,030		572,649
Less: Accretable yield		147,767		162,959
Carrying amount, gross		402,263		409,690
Less: Allowance for covered loan and lease losses		54,398		52,729
Carrying amount, net	$	347,865	$	356,961

The following tables describe the accretable yield and non-accretable discount activity of covered loans for the quartersended March 31, 2014 and2013:

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Accretable yield activity
Balance at beginning of period	$	162,959	$	188,008
Accretion		(23,388)		(20,229)
Transfer from non-accretable discount		8,196		6,328
Balance at end of period	$	147,767	$	174,107
	Quarter Ended March 31,
	2014		2013
	(In thousands)
Non-accretable discount activity
Balance at beginning of period	$	129,477	$	237,555
Principal losses		(13,958)		(16,991)
Transfer to accretable yield		(8,196)		(6,328)
Balance at end of period	$	107,323	$	214,236

Non-accrual Loans

The following table presents the recorded investment in loansin non-accrual status by class ofloans as of March 31, 2014 and December 31, 2013:

	March 31,		December 31,
	2014		2013
	(In thousands)
Originated and other loans and leases held for investment
Mortgage
Traditional (by origination year):
Up to the year 2002	$	2,884	$	3,428
Years 2003 and 2004		2,359		1,845
Year 2005		6,667		4,922
Year 2006		4,555		4,418
Years 2007, 2008 and 2009		4,943		4,511
Years 2010, 2011, 2012, 2013 and 2014		8,342		7,818
		29,750		26,942
Non-traditional		2,425		2,311
Loss mitigation program		16,903		18,792
		49,078		48,045
Home equity secured personal loans		138		138
		49,216		48,183
Commercial
Commercial secured by real estate
Middle market		11,596		11,895
Retail		8,760		7,208
		20,356		19,103
Other commercial and industrial
Middle market		513		1,134
Retail		2,923		2,485
Floor plan		-		108
		3,436		3,727
		23,792		22,830
Consumer
Credit cards		354		232
Overdrafts		4		-
Personal lines of credit		161		84
Personal loans		547		485
Cash collateral personal loans		18		4
		1,084		805
Auto and leasing		6,047		5,089
	$	80,139	$	76,907

	March 31,		December 31,
	2014		2013
	(In thousands)
Acquired loans accounted under ASC 310-20
Commercial
Commercial secured by real estate
Retail	$	688	$	956
Floor plan		101		101
		789		1,057
Other commercial and industrial
Corporate		96		97
Retail		851		1,371
Floor plan		126		18
		1,073		1,486
		1,862		2,543
Consumer
Credit cards		2,076		2,068
Personal loans		58		151
		2,134		2,219
Auto		1,515		1,608
		5,511		6,370
Total non-accrual loans	$	85,650	$	83,277

Loans accounted for under ASC 310-30 are excluded from the above table as they are considered to be performing due to the application of the accretion method, in which these loans will accrete interest income over the remaining life of the loans using estimated cash flow analyses.

Effective April 24, 2013, delinquent residential mortgage loans insured or guaranteed under applicable FHA and VA programs are placed in non-accrual when they become18 months or more past due, since they are insured loans. Before that date, they were placed in non-accrual when they became 90 days or more past due.

At March31, 2014 and December 31, 2013, loanswhose terms have been extended and which are classified as troubled-debt restructurings that are not included in non-accrual loans amounted to $70.8 millionand $66.5 million, respectively, as they are performing under their new terms.

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2014

Commitments and Contingencies [Abstract]

COMMITMENTS

NOTE 16—COMMITMENTS AND CONTINGENCIES

Loan Commitments

In the normal course of business, the Company becomes a party to credit-related financial instruments with off-balance-sheet risk to meet the financing needs of its customers. These financial instruments include commitments to extend credit, standby and commercial letters of credit, and financial guarantees. Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amounts recognized in the consolidatedstatements of financial condition. The contract or notional amount of those instruments reflects the extent of the Company's involvement in particular types of financial instruments.

The Company's exposure to credit losses in the event of nonperformance by the counterparty to the financial instrument for commitments to extend credit, including commitments under credit card arrangements, and commercial letters of credit is represented by the contractual notional amounts of those instruments, which do not necessarily represent the amounts potentially subject to risk. In addition, the measurement of the risks associated with these instruments is meaningful only when all related and offsetting transactions are identified. The Companyuses the same credit policies in making commitments and conditional obligations as it does for on-balance-sheet instruments.

Summarized credit-related financial instruments at March 31, 2014 and December 31, 2013were as follows:

	March 31,		December 31,
	2014		2013
	(In thousands)
Commitments to extend credit	$	494,327	$	520,269
Commercial letters of credit		1,740		1,096

Commitments to extend credit represent agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. The Company evaluates each customer's creditworthiness on a case-by-case basis. The amount of collateral obtained, if it is deemed necessary by the Company upon the extension of credit, is based on management's credit evaluation of the counterparty.

At March 31, 2014 and December 31, 2013, commitments to extend credit consisted mainly of undisbursed available amounts on commercial lines of credit, construction loans, and revolving credit card arrangements. Since many of the unused commitments are expected to expire unused or be only partially used, the total amount of these unused commitments does not necessarily represent future cash requirements. These lines of credit had a reserve of $900 thousand at both March 31, 2014 and December 31, 2013.

Commercial letters of credit are issued or confirmed to guarantee payment of customers' payables or receivables in short-term international trade transactions. Generally, drafts will be drawn when the underlying transaction is consummated as intended. However, the short-term nature of this instrument serves to mitigate the risk associated with these contracts.

The summary of instruments that are considered financial guarantees in accordance with the authoritative guidance related to guarantor's accounting and disclosure requirements for guarantees, including indirect guarantees of indebtedness of others, at March 31, 2014 and December 31, 2013, is as follows:

	March 31,		December 31,
	2014		2013
	(In thousands)
Standby letters of credit and financial guarantees	$	38,875	$	38,577
Loans sold with recourse		118,163		122,291
Commitments to sell or securitize mortgage loans		34,220		99,307

Standby letters of credit and financial guarantees are written conditional commitments issued by the Company to guarantee the payment and/or performance of a customer to a third party (“beneficiary”). If the customer fails to comply with the agreement, the beneficiary may draw on the standby letter of credit or financial guarantee as a remedy. The amount of credit risk involved in issuing letters of credit in the event of nonperformance is the face amount of the letter of credit or financial guarantee. These guarantees are primarily issued to support public and private borrowing arrangements, including commercial paper, bond financing, and similar transactions. The amount of collateral obtained, if it is deemed necessary by the Company upon extension of credit, is based on management's credit evaluation of the customer.

Lease Commitments

The Company has entered into various operating lease agreements for branch facilities and administrative offices. Rent expense for the quarters endedMarch 31, 2014 and 2013, amounted to $2.5million,and $2.7million,respectively, and is included in the “occupancy and equipment” caption in the unaudited consolidated statements of operations. Future rental commitments under leases in effect at March 31, 2014, exclusive of taxes, insurance, and maintenance expenses payable by the Company, are summarized as follows:

Quarter Ending March 31,	Minimum Rent
	(In thousands)
2014	$	6,170
2015		8,013
2016		7,388
2017		6,761
2018		5,864
Thereafter		22,004
	$	56,200

CONTINGENCIES

Contingencies

The Company and its subsidiaries are defendants in a number of legal proceedings incidental to their business. In the ordinary course of business, the Company and its subsidiaries are also subject to governmental and regulatory examinations. Certain subsidiaries of the Company, including the Bank (and its subsidiary OIB), Oriental Financial Services, and Oriental Insurance, are subject to regulation by various U.S., Puerto Rico and other regulators.

The Company seeks to resolve all litigation and regulatory matters in the manner management believes is in the best interests of the Company and its shareholders, and contests allegations of liability or wrongdoing and, where applicable, the amount of damages or scope of any penalties or other relief sought as appropriate in each pending matter.

Subject to the accounting and disclosure framework under the provisions of ASC 450, it is the opinion of the Company's management, based on current knowledge and after taking into account its current legal accruals, that the eventual outcome of all matters would not be likely to have a material adverse effect on the consolidated statements of financial condition of the Company. Nonetheless, given the substantial or indeterminate amounts sought in certain of these matters, and the inherent unpredictability of such matters, an adverse outcome in certain of these matters could, from time to time, have a material adverse effect on the Company's consolidated results of operations or cash flows in particular quarterly or annual periods. The Company has evaluated all litigation and regulatory matters where the likelihood of a potential loss is deemed reasonably possible. The Company has determined that the estimate of the reasonably possible loss is not significant.

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Related Party Transactions

3 Months Ended

Mar. 31, 2014

Related Party Transactions [Abstract]

RELATED PARTY TRANSACTIONS

NOTE 12—RELATED PARTY TRANSACTIONS

The Bank grants loans to its directors, executive officers and to certain related individuals or organizations in the ordinary course of business. These loans are offered at the same terms as loans to unrelated third parties. As of March 31, 2014 and December 31,2013, these loanbalances amounted to $19.3 million and $19.0 million, respectively.The activity and balance of these loans for the quarters endedMarch 31, 2014and 2013were as follows:

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Balance at the beginning of year	$	18,963	$	3,772
New loans		-		2,435
Repayments and sales		304		(95)
Credits of persons no longer considered related parties		-		(57)
Balance at the end of year	$	19,267	$	6,055

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Borrowings (Repurchase Agreements) (Details) (Securities Sold under Agreements to Repurchase [Member], USD $) In Thousands, unless otherwise specified			3 Months Ended
	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2014 Due date: 12 3 2014 [Member]	Mar. 31, 2014 Due date: 6 13 2015 [Member]	Mar. 31, 2014 Due date: 12 8 2016 [Member]	Mar. 31, 2014 Due date: 3 2 2017 [Member]
Debt Instrument [Line Items]
Borrowing Balance	$ 1,010,000	$ 1,265,000	$ 85,000	$ 255,000	$ 170,000	$ 500,000
Weighted Average Coupon	2.89%		0.675%	0.84%	1.50%	4.78%
Settlement Date			Dec. 03, 2012	Dec. 10, 2012	Dec. 06, 2012	Mar. 02, 2007
Investment Repurchase Agreement, Repurchase Date			Dec. 03, 2014	Jun. 13, 2015	Dec. 08, 2016	Mar. 02, 2017

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Accrued Interest Receivable and Other Assets

3 Months Ended

Mar. 31, 2014

Accrued Interest Receivable And Other Assets [Abstract]

Other Assets Disclosure [Text Block]

NOTE 8—ACCRUED INTEREST RECEIVABLE ANDOTHER ASSETS

Accrued interest receivable at March 31, 2014 and December 31, 2013 consists of the following:

	March 31,		December 31,
	2014		2013
	(In thousands)
Non-covered loans	$	14,440	$	13,378
Investments		4,529		5,356
	$	18,969	$	18,734

Other assets at March 31, 2014 and December 31, 2013 consist of the following:

		March 31,		December 31,
	2014		2013
	(In thousands)
Prepaid expenses	$	15,531	$	15,439
Core deposit and customer relationship intangibles		11,370		11,912
Other repossessed assets		13,964		12,583
Mortgage tax credits		8,706		8,706
Investment in Statutory Trust		1,083		1,083
Accounts receivable and other assets		43,689		48,717
	$	94,343	$	98,440

Prepaid expenses amounting to $15.5 million and $15.4 million at March 31, 2014 and December 31, 2013, respectively, include prepaid municipal, property and income taxes aggregating to $9.0million and $9.6million, respectively.

As part of the FDIC-assisted acquisition of Eurobank and BBVAPR Acquisition, the Company recorded a core deposit intangible representing the value of checking and savings deposits acquired. At March 31, 2014 and December 31, 2013, this core deposit intangible amounted to $7.5million and $7.8million, respectively. In addition, as part of the BBVAPR Acquisition on December 18, 2012, the Company recorded a customer relationship intangible amounting to $5.0 million representing the value of customer relationships acquired in the broker-dealer and insurance subsidiaries as of December 31, 2012. At March 31, 2014 and December 31, 2013, this customer relationship intangible amounted to $3.9million and $4.1million, respectively.

Other repossessed assets totaled $14.0 million and $12.6 million atMarch 31, 2013 and December 31, 2013, respectively, include repossessed automobilesamounting to $13.7millionand $12.3million, respectively.

At March 31, 2014 and December 31, 2013, tax credits for the Companyamounted $8.7 million.These tax credits do not have an expiration date.

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Allowance for Loan and Lease Losses (Gross Loan and Allowance for loan and lease losses) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2013	Dec. 31, 2012
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	$ 4,689,259	$ 4,669,192
Non-covered acquired loans accounted under ASC 310-20
Financing Receivable, Allowance for Credit Losses [Line Items]
Financing Receivable Allowance For Credit Losses Individually Evaluated For Impairment1	0	0
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	3,618	2,354
Financing Receivable, Allowance for Credit Losses	3,618	2,354	386	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Financing Receivable, Collectively Evaluated for Impairment	392,491	435,439
Loans and Leases Receivable, Gross, Carrying Amount	392,491	435,439
Non-covered originated loans [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Financing Receivable Allowance For Credit Losses Individually Evaluated For Impairment1	9,705	10,139
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	39,802	38,942
Financing Receivable, Allowance for Credit Losses	49,507	49,081	42,334	39,921
Financing Receivable, Individually Evaluated for Impairment	115,511	112,639
Financing Receivable, Collectively Evaluated for Impairment	2,427,216	2,288,901
Loans and Leases Receivable, Gross, Carrying Amount	2,542,727	2,401,540
Residential Portfolio Segment | Non-covered acquired loans accounted under ASC 310-20
Financing Receivable, Allowance for Credit Losses [Line Items]
Financing Receivable, Allowance for Credit Losses			0
Residential Portfolio Segment | Non-covered originated loans [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Financing Receivable Allowance For Credit Losses Individually Evaluated For Impairment1	8,001	8,708
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	11,510	11,229
Financing Receivable, Allowance for Credit Losses	19,511	19,937	22,889	21,092
Financing Receivable, Individually Evaluated for Impairment	87,744	84,494
Financing Receivable, Collectively Evaluated for Impairment	694,406	681,771
Loans and Leases Receivable, Gross, Carrying Amount	782,150	766,265
Commercial Portfolio Segment | Non-covered acquired loans accounted under ASC 310-20
Financing Receivable, Allowance for Credit Losses [Line Items]
Financing Receivable Allowance For Credit Losses Individually Evaluated For Impairment1	0	0
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	867	926
Financing Receivable, Allowance for Credit Losses	867	926	386	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Financing Receivable, Collectively Evaluated for Impairment	71,577	77,681
Loans and Leases Receivable, Gross, Carrying Amount	71,577	77,681
Commercial Portfolio Segment | Non-covered originated loans [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Financing Receivable Allowance For Credit Losses Individually Evaluated For Impairment1	1,704	1,431
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	12,290	13,466
Financing Receivable, Allowance for Credit Losses	13,994	14,897	16,314	17,072
Financing Receivable, Individually Evaluated for Impairment	27,767	28,145
Financing Receivable, Collectively Evaluated for Impairment	1,142,378	1,099,512
Loans and Leases Receivable, Gross, Carrying Amount	1,170,145	1,127,657
Consumer Portfolio Segment | Non-covered acquired loans accounted under ASC 310-20
Financing Receivable, Allowance for Credit Losses [Line Items]
Financing Receivable Allowance For Credit Losses Individually Evaluated For Impairment1	0	0
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	504	0
Financing Receivable, Allowance for Credit Losses	504	0	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Financing Receivable, Collectively Evaluated for Impairment	52,049	56,174
Loans and Leases Receivable, Gross, Carrying Amount	52,049	56,174
Consumer Portfolio Segment | Non-covered originated loans [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Financing Receivable Allowance For Credit Losses Individually Evaluated For Impairment1	0	0
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	7,135	6,006
Financing Receivable, Allowance for Credit Losses	7,135	6,006	1,313	856
Financing Receivable, Individually Evaluated for Impairment	0	0
Financing Receivable, Collectively Evaluated for Impairment	142,492	127,744
Loans and Leases Receivable, Gross, Carrying Amount	142,492	127,744
Auotomobile loans portfolio segment [Member] | Non-covered acquired loans accounted under ASC 310-20
Financing Receivable, Allowance for Credit Losses [Line Items]
Financing Receivable Allowance For Credit Losses Individually Evaluated For Impairment1	0	0
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	2,247	1,428
Financing Receivable, Allowance for Credit Losses	2,247	1,428
Financing Receivable, Individually Evaluated for Impairment	0	0
Financing Receivable, Collectively Evaluated for Impairment	268,865	301,584
Loans and Leases Receivable, Gross, Carrying Amount	268,865	301,584
Auotomobile loans portfolio segment [Member] | Non-covered originated loans [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Financing Receivable Allowance For Credit Losses Individually Evaluated For Impairment1	0	0
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	8,731	7,866
Financing Receivable, Allowance for Credit Losses	8,731	7,866
Financing Receivable, Individually Evaluated for Impairment	0	0
Financing Receivable, Collectively Evaluated for Impairment	447,940	379,874
Loans and Leases Receivable, Gross, Carrying Amount	447,940	379,874
Auto and Leasing loans receivable [Member] | Non-covered originated loans [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Financing Receivable, Allowance for Credit Losses	8,731	7,866	1,741	533
Unallocated Financing Receivables | Non-covered acquired loans accounted under ASC 310-20
Financing Receivable, Allowance for Credit Losses [Line Items]
Financing Receivable Allowance For Credit Losses Individually Evaluated For Impairment1	0	0
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	0	0
Financing Receivable, Allowance for Credit Losses	0	0	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Financing Receivable, Collectively Evaluated for Impairment	0	0
Loans and Leases Receivable, Gross, Carrying Amount	0	0
Unallocated Financing Receivables | Non-covered originated loans [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Financing Receivable Allowance For Credit Losses Individually Evaluated For Impairment1	0	0
Financing Receivable, Allowance for Credit Losses, Collectively Evaluated for Impairment	136	375
Financing Receivable, Allowance for Credit Losses	136	375	77	368
Financing Receivable, Individually Evaluated for Impairment	0	0
Financing Receivable, Collectively Evaluated for Impairment	0	0
Loans and Leases Receivable, Gross, Carrying Amount	$ 0	$ 0

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Fair value (Estimated fair value and carrying value) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2013	Dec. 31, 2012
Assets, Fair Value Disclosure [Abstract]
Available-for-sale Securities	$ 1,455,685	$ 1,588,425
Federal Home Loan Bank (FHLB) stock	24,430	24,450
Derivative Assets	15,861	20,502
Servicing Assets	13,970	13,801
Liabilities, Fair Value Disclosure [Abstract]
Derivative liabilities	13,830	14,937
Assets,Carrying Value [Abstract]
Total cash and cash equivalents	624,636	621,269	566,996	868,695
Restricted Cash And Cash Equivalents	15,170	82,199
Securities Purchased under Agreements to Resell	0	60,000
Trading Securities	1,910	1,869
Total loans not covered under shared-loss agreements with FDIC, net	4,635,394	4,615,929
Covered, net	347,865	356,961
FDIC Indemnification Asset	166,194	189,240	283,124	302,295
Accrued interest receivable	18,969	18,734
Liabilities,Carrying Value Disclosure [Abstract]
Deposits, Total	5,300,992	5,383,265
Securities Sold under Agreements to Repurchase	1,012,240	1,267,618
Federal Funds Purchased	23,712	0
Subordinated capital notes	100,404	100,010
Accrued expenses and other liabilities	140,037	144,424
Fair Value, Inputs, Level 1 [Member]
Assets, Fair Value Disclosure [Abstract]
Cash and Cash Equivalents, Fair Value Disclosure	624,636	621,269
Restricted Cash, at Fair Value	15,170	82,199
Assets,Carrying Value [Abstract]
Total cash and cash equivalents	624,636	621,269
Restricted Cash And Cash Equivalents	15,170	82,199
Fair Value, Inputs, Level 2 [Member]
Assets, Fair Value Disclosure [Abstract]
Federal Funds Sold and Securities Borrowed or Purchased under Agreements to Resell, Fair Value Disclosure	0	60,000
Available-for-sale Securities	1,435,632	1,568,745
Federal Home Loan Bank (FHLB) stock	24,430	24,450
Derivative Assets	3,306	4,072
Receivables, Fair Value Disclosure	13,830	14,937
Liabilities, Fair Value Disclosure [Abstract]
Short term borrowings	0	0
Assets,Carrying Value [Abstract]
Securities Purchased under Agreements to Resell	0	60,000
Trading Securities	1,910	1,869
Investment securities AFS , carrying value	1,435,632	1,568,745
Federal Home Loan Bank Stock at carrying value	24,430	24,450
Derivative Assets, carrying value	3,306	4,072
Liabilities,Carrying Value Disclosure [Abstract]
Derivative liabilities at carrying value	13,830	14,937
Other Short Term Borrowings	0	0
Fair Value, Inputs, Level 3 [Member]
Assets, Fair Value Disclosure [Abstract]
Available-for-sale Securities	20,053	19,680
Non-covered loans, net	4,737,604	4,857,505
Covered loans, net	400,355	459,444
Derivative Assets	12,555	16,430
FDIC Indemnification Asset Fair Value Disclosure	106,170	152,965
Receivables, Fair Value Disclosure	18,969	18,734
Servicing Assets	13,970	13,801
Liabilities, Fair Value Disclosure [Abstract]
Deposits, Fair Value Disclosure	5,247,226	5,409,540
Securities sold under agreements to repurchase	1,076,000	1,323,903
Advances from FHLB	340,805	335,324
Federal Funds Purchased, Fair Value Disclosure	23,712	0
Notes Payable Fair Value Disclosure	3,583	3,638
Subordinated capital notes	87,240	99,316
Accrued expenses and other liabilities	140,037	144,424
Assets,Carrying Value [Abstract]
Investment securities AFS , carrying value	20,053	19,680
Total loans not covered under shared-loss agreements with FDIC, net	4,654,749	4,662,458
Covered, net	347,865	356,961
Derivative Assets, carrying value	12,555	16,430
FDIC Indemnification Asset	166,194	189,240
Accrued interest receivable	18,969	18,734
Servicing assets, carrying value	13,970	13,801
Liabilities,Carrying Value Disclosure [Abstract]
Deposits, Total	5,300,992	5,383,265
Securities Sold under Agreements to Repurchase	1,012,240	1,267,618
Advances from FHLB	335,689	336,143
Federal Funds Purchased	23,712	0
Term Notes	3,708	3,663
Subordinated capital notes	100,404	100,010
Accrued expenses and other liabilities	$ 140,037	$ 144,424

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FDIC Loss Share Asset and True-up Payment Obligation

3 Months Ended

Mar. 31, 2014

Banking and Thrift [Abstract]

FDIC Share Loss Indemnification Asset and True-up Payment Obligation [Text Block]

NOTE 6- FDIC LOSS SHARE ASSET AND TRUE-UP PAYMENT OBLIGATION

As part of the Purchase and Assumption Agreement between the Bank and the FDIC (the “Purchase and Assumption Agreement”), the Bank and the FDIC entered into shared-loss agreements whereby the FDIC in connection with the Eurobank acquisition, covers a substantial portion of any losses on loans (and related unfunded loan commitments), foreclosed real estate and other repossessed properties.

The acquired loans, foreclosed real estate, and other repossessed properties subject to the shared-loss agreements are collectively referred to as “covered assets.” Under the terms of the shared-loss agreements, the FDIC absorbs80% of losses and shares in 80% of loss recoveries on covered assets. The term of the shared-loss agreementcovering single family residential mortgage loans is ten years with respect to losses and loss recoveries, while theterm of the shared-loss agreement covering commercial loans is five years with respect to losses and eight yearswith respect to loss recoveries, from the April 30, 2010 acquisition date. The shared-loss agreements also provide for certain costs directly related to the collection and preservation of covered assets to be reimbursed at an 80% level. The indemnification asset represents the portion of estimated losses covered by the shared-loss agreements between the Bank and the FDIC.

The following table presents the activity in the FDIC loss share assetand true-up payment obligation for the quarters ended March 31, 2014 and 2013:

	Quarter Ended March 31,
	2014		2013
	(In thousands)
FDIC share-loss indemnification asset:
Balance at beginning of period	$	189,240	$	302,295
Shared-loss agreements reimbursements from the FDIC		(8,236)		(6,650)
Increase (decrease) in expected credit losses to be covered under shared-loss agreements, net		40		(1,822)
FDIC shared-loss expense		(17,622)		(12,201)
Incurred expenses to be reimbursed under shared-loss agreements		2,772		1,502
Balance at end of period	$	166,194	$	283,124
True-up payment obligation:
Balance at beginning of period	$	18,510	$	15,496
FDIC shared-loss expense		865		670
Balance at end of period	$	19,375	$	16,166

The FDIC shared-loss expense increased as the Company continues to forecast better performance and cash flows from covered loans than previously expected resulting in a minor increase in the amortization of the FDIC shared-loss indemnification asset.

The FDIC shared-loss expense of $18.5 million for the quarterended March 31, 2014 comparedto $12.9 million for the same period in 2013, resulted from the ongoing evaluation of expected cash flows of the covered loan portfolio, which resulted in reduced projected losses expected to be collected from the FDIC and the improved accretable yield on the covered loans. Forecasted losses show a decreasing trend during the quarter ended March 31, 2014 as compared to the projections in 2013.The reduction in claimable losses amortizes the shared-loss indemnification asset through theshorter of the life of the shared loss agreement or the loan holding period. This amortization is net of the accretion of the discount recorded to reflect the expected claimable loss at its net present value. During the quarter ended March 31, 2014, the net amortization included $3.5 million of additional amortization of the FDIC indemnification asset from stepped up cost recoveries on certain construction, commercial, and leasing loan pools. Additional amortization of the FDIC indemnification asset may be recorded, should the Company continue to experience reduced expected losses. The majority of the FDIC indemnification asset is recorded for projected claimable losses on non-single family residential loans whose loss share period ends in the second quarter of 2015, although the recovery share period extends for an additional three-year period.

The Bank agreed to make a true-up payment, also known as clawback liability or clawback provision, to the FDIC on the date that is 45 days following the last day (such day, the “True-Up Measurement Date”) of the final shared-loss month, or upon the final disposition of all covered assets under the shared-loss agreements in the event losses thereunder fail to reach expected levels. Under the shared-loss agreements, the Bank will pay to the FDIC 50% of the excess, if any, of: (i) 20% of the Intrinsic Loss Estimate of $906.0 million (or $181.2 million) (as determined by the FDIC) less (ii) the sum of: (A) 25% of the asset discount (per bid) (or $227.5 million); plus (B) 25% of the cumulative shared-loss payments (defined as the aggregate of all of the payments made or payable to the Bank minus the aggregate of all of the payments made or payable to the FDIC); plus (C) the sum of the period servicing amounts for every consecutive twelve-month period prior to and ending on the True-Up Measurement Date in respect of each of the shared-loss agreements during which the shared-loss provisions of the applicable shared-loss agreement is in effect (defined as the product of the simple average of the principal amount of shared-loss loans and shared-loss assets at the beginning and end of such period times 1%). The true-up payment represents an estimated liability of $19.4million and $18.5 million, net of discount, as of March 31, 2014 and December 31, 2013, respectively. The estimated liability is included withinother liabilities in the unaudited consolidated statements of financial condition.

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Derivative Activities

3 Months Ended

Mar. 31, 2014

Derivative Activities [Abstract]

DERIVATIVE ACTIVITIES

NOTE 7— DERIVATIVE ACTIVITIES

During the quarterended March 31, 2014, losses of$478 thousand were recognized and reflected as “Derivative Activities” in the unaudited consolidated statements of operations, which were mainly related to the options tied to the Standard & Poor's 500 stock market index.During the quarter ended March 31, 2013, losses of $788thousand were recognized and were mainlyrelated to the options tied to the Standard & Poor's 500 stock market index

The following table details “Derivative Assets” and “Derivative Liabilities” as reflected in the unauditedconsolidatedstatements of financial condition at March 31, 2014 and December 31, 2013:

	March 31,		December 31,
	2014		2013
	(In thousands)
Derivative assets:
Options tied to S&P 500 Index	$	12,555	$	16,430
Interest rate swaps designated as cash flow hedges		166		850
Interest rate swaps not designated as hedges		2,755		2,861
Interest rate caps		374		319
Other		11		42
	$	15,861	$	20,502
Derivative liabilities:
Interest rate swaps designated as cash flow hedges		10,695		11,757
Interest rate swaps not designated as hedges		2,755		2,861
Interest rate caps		374		319
Other		6		-
	$	13,830	$	14,937

Interest Rate Swaps

The Company enters into interest rate swap contracts to hedge the variability of future interest cash flows offorecasted wholesale borrowings, attributable to changes in a predetermined variable index rate. The interest rate swaps effectively fix the Company's interest paymentson an amount of forecasted interest expense attributable to the variable index rate corresponding to the swapnotional stated rate. These swaps are designated as cash flow hedges for the forecastedwholesale borrowing transactions and are properly documented as such, and therefore, qualify for cash flow hedgeaccounting. Any gain or loss associated with the effective portion of our cash flow hedges was recognized in other comprehensive income and is subsequently reclassified into earnings in the period during which the hedged forecasted transactions affect earnings. Changes in the fair value of these derivatives are recorded in accumulated other comprehensive income to the extent there is no significant ineffectiveness in the cash flow hedging relationships. Currently, the Company does not expect to reclassify any amount included in other comprehensive income related to these interest rate swaps to earnings in the next twelve months.

The following table shows a summary of these swaps and their terms at March 31, 2014:

	Notional		Fixed	Variable	Trade	Settlement	Maturity
Type	Amount		Rate	Rate Index	Date	Date	Date
	(In thousands)
Interest Rate Swaps	$	25,000	2.4365%	1-Month LIBOR	05/05/11	05/04/12	05/04/16
		25,000	2.6200%	1-Month LIBOR	05/05/11	07/24/12	07/24/16
		25,000	2.6350%	1-Month LIBOR	05/05/11	07/30/12	07/30/16
		50,000	2.6590%	1-Month LIBOR	05/05/11	08/10/12	08/10/16
		100,000	2.6750%	1-Month LIBOR	05/05/11	08/16/12	08/16/16
		40,277	2.4210%	1-Month LIBOR	07/03/13	07/03/13	08/01/23
	$	265,277

An unrealized loss of $10.5million was recognized in accumulated other comprehensive income related to the valuation of these swaps at March 31, 2014, and the related asset and liability are being reflected in the accompanying unaudited consolidated statements of financial condition.

At March 31, 2014 and December 31, 2013, interest rate swaps not designated as hedging instruments that were offered to clients represented an asset of $2.8million and $2.9 million, respectively,and were included as part of derivative assets in the unaudited consolidated statements of financial position.The credit risk to these clients stemming from these derivatives, if any, is not material. At March 31, 2014 and December 31, 2013, interest rate swaps not designated as hedging instruments that are the mirror-images of the derivatives offered to clients represented a liability of $2.8 million and $2.9 million, respectively, and were included as part of derivative liabilities in the unaudited consolidated statements of financial condition.

The following table shows a summary of these interest rate swaps not designated as hedging instruments and their terms at March 31, 2014:

	Notional		Fixed	Variable	Settlement	Maturity
Type	Amount		Rate	Rate Index	Date	Date
	(In thousands)
Interest Rate Swaps - Derivatives Offered to Clients	$	4,094	5.1300%	1-Month LIBOR	07/03/06	07/03/16
		12,500	5.5050%	1-Month LIBOR	04/11/09	04/11/19
	$	16,594
Interest Rate Swaps - Mirror Image Derivatives	$	4,094	5.1300%	1-Month LIBOR	07/03/06	07/03/16
		12,500	5.5050%	1-Month LIBOR	04/11/09	04/11/19
	$	16,594

Options Tied to Standard & Poor's 500 Stock Market Index

The Companyhas offered its customers certificates of deposit with an option tied to the performance of the S&P 500 Index. The Company uses option agreements with major broker-dealers to manage its exposure to changes in this index. Under the terms of the option agreements, the Company receives the average increase in the month-end value of the index in exchange for a fixed premium. The changes in fair value of the option agreements used to manage the exposure in the stock market in the certificates of deposit are recorded in earnings. At March 31, 2014 andDecember 31, 2013, the purchased options used to manage exposure to the S&P 500 Index on stock indexed deposits represented an asset of $12.6 million (notional amount of $23.8million) and $16.4 million (notional amount of $28.0million), respectively, and the options sold to customers embedded in the certificates of deposit and recorded as deposits in the unauditedconsolidated statements of financial condition, represented a liability of $12.1million (notional amount of $22.9million) and $15.7million (notional amount of $26.9million), respectively.

Interest rate caps

The Companyhas entered into interest rate cap transactionswith various clients with floating-rate debt who wish to protect their financial results against increases in interest rates. In these cases, theCompanysimultaneously enters into mirror-image interest rate cap transactions with financial counterparties. None of these cap transactions qualify for hedge accounting; therefore, they are marked to market through earnings.The outstanding total notional amount of interest rate caps was $110.0million at both March 31, 2014 and December 31, 2013. At March 31, 2014 and December 31, 2013, the interest rate caps sold to clients represented a liability of $374thousand and $319 thousand, respectively, and were included as part of derivative liabilities in the unaudited consolidated statements of financial condition. At March 31, 2014 and December 31, 2013, the interest rate caps purchased as mirror-images represented an asset of $374 thousand and $319 thousand, respectively, and were included as part of derivative assets in the unaudited consolidated statements of financial condition.

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Deposits and Related Interest

3 Months Ended

Mar. 31, 2014

Deposits and Related Interest [Abstract]

DEPOSITS AND RELATED INTEREST

NOTE 9— DEPOSITS AND RELATED INTEREST

Total deposits as of March 31, 2014 and December 31, 2013consist of the following:

	March 31,		December 31,
	2014		2013
	(In thousands)
Non-interest bearing demand deposits	$	755,909	$	550,302
Interest-bearing savings and demand deposits		2,604,664		2,683,996
Individual retirement accounts		338,719		347,262
Retail certificates of deposit		556,928		598,367
Institutional certificates of deposit		331,859		375,224
Total core deposits		4,588,079		4,555,151
Brokered deposits		712,913		828,114
Total deposits	$	5,300,992	$	5,383,265

Brokered deposits include $617.7million in certificates of deposits and $95.2million in money market accounts at March 31, 2014, and $729.8 million in certificates of deposits and $98.3 million in money market accounts at December 31, 2013.

The weighted average interest rate of the Company's deposits was 0.68% atMarch 31, 2014and 0.73% at December 31, 2013, inclusive of non-interest bearing deposits of $755.9million and $550.3 million, respectively.Interest expense for the quartersended March 31, 2014 and2013 was as follows:

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Demand and savings deposits	$	5,028	$	5,962
Certificates of deposit		3,950		3,973
	$	8,978	$	9,935

At March 31, 2014 and December 31,2013, demand and interest-bearing deposits and certificates of depositincluded deposits of Puerto Rico Cash & Money Market Fund, Inc.,which amounted to $97.9 million and $93.1 million, respectively, with a weighted average rate of 0.77% in both years,and were collateralized with investment securities with a fair value of $77.2million and$67.5 million, respectively.

At March 31, 2014 and December 31, 2013, time deposits in denominations of $100 thousand or higher, excluding accrued interest and unamortized discounts, amounted to $769.1million and $845.8 million, including public fund time deposits from various Puerto Rico government municipalities, agencies, and corporations of $6.8million and $26.7million, respectively, at a weighted average rate of 0.49% at March 31, 2014 and0.32% atDecember 31, 2013.

At December 31, 2013, public fund deposits from various Puerto Rico government agencieswere collateralized with investment securities with a fair value of $97.8 million, and with commercial loans amounting to $547.3million at March 31, 2014 and $549.0million at December 31, 2013.

Excluding equity indexed options in the amount of $11.1 million, which are used by the Company to manage its exposure to the S&P 500 Index, and also excluding accrued interests of $1.7 million and unamortized deposit discount in the amount of $3.3million, the scheduled maturities of certificates of deposit at March 31, 2014are as follows:

	March 31, 2014
	(In thousands)
Within one year:
Three (3) months or less	$	303,340
Over 3 months through 1 year		780,260
		1,083,600
Over 1 through 2 years		351,142
Over 2 through 3 years		257,750
Over 3 through 4 years		84,607
Over 4 through 5 years		52,029
	$	1,829,128

The aggregate amount of overdraft in demand deposit accounts that were reclassified to loans amounted to $734thousand and $1.8million as of March 31, 2014 and December 31, 2013, respectively.

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Allowance for Loan and Lease Losses (Troubled debt restructurings, Rolling Twelve Months) (Details) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Mar. 31, 2014 number	Mar. 31, 2013 number
Mortgages [Member]
Financing Receivable, Modifications [Line Items]
Number of Contracts	19	32
Recored Investment	$ 2,592	$ 4,295
Commercial Loan [Member]
Financing Receivable, Modifications [Line Items]
Number of Contracts	0	1
Recored Investment	0	18
Consumer Loan [Member]
Financing Receivable, Modifications [Line Items]
Number of Contracts	1	0
Recored Investment	$ 11	$ 0

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Borrowings (Repurchase Transaction Liability and Market Value of its Underlying Collateral) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Assets Sold Under Agreements To Repurchase Line Items
Assets Sold Under Agreements To Repurchase Repurchase Liability	$ 1,010,000	$ 1,265,000
Assets Sold Under Agreements To Repurchase Interest Rate	2.89%
Market value of underlying collateral of a repurchase agreement	1,133,922	1,342,505
FNMA and FHLMC [Member]
Assets Sold Under Agreements To Repurchase Line Items
Market value of underlying collateral of a repurchase agreement	1,061,519	1,234,833
Government National Mortgage Association Certificates and Obligations (GNMA) [Member]
Assets Sold Under Agreements To Repurchase Line Items
Market value of underlying collateral of a repurchase agreement	2,403	3,000
Collateralized Mortgage Obligations [Member]
Assets Sold Under Agreements To Repurchase Line Items
Market value of underlying collateral of a repurchase agreement	0	94,023
US Government-sponsored Enterprises Debt Securities [Member]
Assets Sold Under Agreements To Repurchase Line Items
Market value of underlying collateral of a repurchase agreement	70,000	10,649
Securities Sold under Agreements to Repurchase [Member]
Assets Sold Under Agreements To Repurchase Line Items
Assets Sold Under Agreements To Repurchase Interest Rate		2.41%
Securities Sold under Agreements to Repurchase [Member] | Maturity up to 30 days
Assets Sold Under Agreements To Repurchase Line Items
Assets Sold Under Agreements To Repurchase Repurchase Liability		255,000
Assets Sold Under Agreements To Repurchase Interest Rate		0.50%
Market value of underlying collateral of a repurchase agreement		272,053
Securities Sold under Agreements to Repurchase [Member] | Maturity up to 30 days | FNMA and FHLMC [Member]
Assets Sold Under Agreements To Repurchase Line Items
Market value of underlying collateral of a repurchase agreement		216,201
Securities Sold under Agreements to Repurchase [Member] | Maturity up to 30 days | Government National Mortgage Association Certificates and Obligations (GNMA) [Member]
Assets Sold Under Agreements To Repurchase Line Items
Market value of underlying collateral of a repurchase agreement		0
Securities Sold under Agreements to Repurchase [Member] | Maturity up to 30 days | Collateralized Mortgage Obligations [Member]
Assets Sold Under Agreements To Repurchase Line Items
Market value of underlying collateral of a repurchase agreement		48,923
Securities Sold under Agreements to Repurchase [Member] | Maturity up to 30 days | US Government-sponsored Enterprises Debt Securities [Member]
Assets Sold Under Agreements To Repurchase Line Items
Market value of underlying collateral of a repurchase agreement		6,929
Securities Sold under Agreements to Repurchase [Member] | Maturity over 90 days
Assets Sold Under Agreements To Repurchase Line Items
Assets Sold Under Agreements To Repurchase Repurchase Liability	1,010,000	1,010,000
Assets Sold Under Agreements To Repurchase Interest Rate	2.89%	2.89%
Market value of underlying collateral of a repurchase agreement	1,133,922	1,070,452
Securities Sold under Agreements to Repurchase [Member] | Maturity over 90 days | FNMA and FHLMC [Member]
Assets Sold Under Agreements To Repurchase Line Items
Market value of underlying collateral of a repurchase agreement	1,061,519	1,018,632
Securities Sold under Agreements to Repurchase [Member] | Maturity over 90 days | Government National Mortgage Association Certificates and Obligations (GNMA) [Member]
Assets Sold Under Agreements To Repurchase Line Items
Market value of underlying collateral of a repurchase agreement	2,403	3,000
Securities Sold under Agreements to Repurchase [Member] | Maturity over 90 days | Collateralized Mortgage Obligations [Member]
Assets Sold Under Agreements To Repurchase Line Items
Market value of underlying collateral of a repurchase agreement	0	45,100
Securities Sold under Agreements to Repurchase [Member] | Maturity over 90 days | US Government-sponsored Enterprises Debt Securities [Member]
Assets Sold Under Agreements To Repurchase Line Items
Market value of underlying collateral of a repurchase agreement	$ 70,000	$ 3,720

XML

Allowance for Loan and Lease Losses (Risk category of gross non-covered loans not subject to risk rating ) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	$ 4,689,259	$ 4,669,192
Non Covered Loan, Not Subject To Risk Ratings [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	1,693,496	1,631,641
0 - 29 Days Past Due	1,416,347	1,362,392
30 - 59 Days Past Due	86,591	85,475
60 - 89 Days Past Due	28,901	28,939
90-119 Days Past Due	15,681	18,766
120 - 364 Days Past Due	36,614	31,979
365+ Days Past Due	21,108	19,161
Financing Receivable, Individually Evaluated for Impairment	88,254	84,929
Originated loans, not subject to risk rating [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	1,372,582	1,273,883
0 - 29 Days Past Due	1,117,973	1,028,173
30 - 59 Days Past Due	71,912	70,528
60 - 89 Days Past Due	24,515	24,116
90-119 Days Past Due	14,130	16,783
120 - 364 Days Past Due	34,690	30,193
365+ Days Past Due	21,108	19,161
Financing Receivable, Individually Evaluated for Impairment	88,254	84,929
Originated loans, not subject to risk rating [Member] | Mortgages [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	782,150	766,265
0 - 29 Days Past Due	579,912	564,310
30 - 59 Days Past Due	36,001	43,034
60 - 89 Days Past Due	15,117	14,027
90-119 Days Past Due	10,309	12,943
120 - 364 Days Past Due	31,978	28,316
365+ Days Past Due	21,089	19,141
Financing Receivable, Individually Evaluated for Impairment	87,744	84,494
Originated loans, not subject to risk rating [Member] | Conventional Loan [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	620,340	602,188
0 - 29 Days Past Due	535,873	520,782
30 - 59 Days Past Due	33,256	38,441
60 - 89 Days Past Due	14,476	12,716
90-119 Days Past Due	4,561	4,649
120 - 364 Days Past Due	12,892	12,129
365+ Days Past Due	6,184	4,441
Financing Receivable, Individually Evaluated for Impairment	13,098	9,030
Originated loans, not subject to risk rating [Member] | Originated Up To The Year 2002 [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	72,096	76,512
0 - 29 Days Past Due	61,268	64,743
30 - 59 Days Past Due	5,230	6,594
60 - 89 Days Past Due	2,621	1,634
90-119 Days Past Due	382	868
120 - 364 Days Past Due	1,037	1,082
365+ Days Past Due	1,459	1,458
Financing Receivable, Individually Evaluated for Impairment	99	133
Originated loans, not subject to risk rating [Member] | Originated In The Years 2003 And 2004 [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	63,515	65,117
0 - 29 Days Past Due	53,170	56,283
30 - 59 Days Past Due	5,494	4,722
60 - 89 Days Past Due	2,445	1,938
90-119 Days Past Due	484	56
120 - 364 Days Past Due	1,246	1,437
365+ Days Past Due	612	352
Financing Receivable, Individually Evaluated for Impairment	64	329
Originated loans, not subject to risk rating [Member] | Originated In The Year 2005 [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	87,818	89,541
0 - 29 Days Past Due	72,414	74,016
30 - 59 Days Past Due	6,448	8,414
60 - 89 Days Past Due	2,288	2,119
90-119 Days Past Due	1,233	1,198
120 - 364 Days Past Due	3,576	3,037
365+ Days Past Due	1,324	573
Financing Receivable, Individually Evaluated for Impairment	535	184
Originated loans, not subject to risk rating [Member] | Originated In The Year 2006 [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	116,904	120,322
0 - 29 Days Past Due	97,822	99,243
30 - 59 Days Past Due	10,151	12,055
60 - 89 Days Past Due	4,376	4,312
90-119 Days Past Due	1,169	1,148
120 - 364 Days Past Due	2,410	2,755
365+ Days Past Due	850	515
Financing Receivable, Individually Evaluated for Impairment	126	294
Originated loans, not subject to risk rating [Member] | Originated In The Years 2007 2008 And 2009 [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	97,840	101,150
0 - 29 Days Past Due	87,065	91,920
30 - 59 Days Past Due	3,807	3,464
60 - 89 Days Past Due	2,025	1,104
90-119 Days Past Due	223	1,264
120 - 364 Days Past Due	3,619	2,844
365+ Days Past Due	875	554
Financing Receivable, Individually Evaluated for Impairment	226	0
Originated loans, not subject to risk rating [Member] | Originated In The Years 2010 2011 2012 2013 And 2014 [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	182,167	149,546
0 - 29 Days Past Due	164,134	134,577
30 - 59 Days Past Due	2,126	3,192
60 - 89 Days Past Due	721	1,609
90-119 Days Past Due	1,070	115
120 - 364 Days Past Due	1,004	974
365+ Days Past Due	1,064	989
Financing Receivable, Individually Evaluated for Impairment	12,048	8,090
Originated loans, not subject to risk rating [Member] | NonTraditional Mortgage [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	39,790	42,102
0 - 29 Days Past Due	35,078	35,168
30 - 59 Days Past Due	1,744	3,217
60 - 89 Days Past Due	470	1,162
90-119 Days Past Due	0	0
120 - 364 Days Past Due	1,439	1,324
365+ Days Past Due	986	833
Financing Receivable, Individually Evaluated for Impairment	73	398
Originated loans, not subject to risk rating [Member] | Loss Mitigation Program Loan Exclude Individually Impairment Measure [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	86,005	86,318
0 - 29 Days Past Due	8,366	7,762
30 - 59 Days Past Due	1,001	1,376
60 - 89 Days Past Due	171	149
90-119 Days Past Due	219	624
120 - 364 Days Past Due	779	312
365+ Days Past Due	896	1,029
Financing Receivable, Individually Evaluated for Impairment	74,573	75,066
Originated loans, not subject to risk rating [Member] | Home equity secured personal loans [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	733	736
0 - 29 Days Past Due	595	598
30 - 59 Days Past Due	0	0
60 - 89 Days Past Due	0	0
90-119 Days Past Due	0	0
120 - 364 Days Past Due	126	126
365+ Days Past Due	12	12
Financing Receivable, Individually Evaluated for Impairment	0	0
Originated loans, not subject to risk rating [Member] | GNMA's Buy Back Option related
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	35,282	34,921
0 - 29 Days Past Due	0	0
30 - 59 Days Past Due	0	0
60 - 89 Days Past Due	0	0
90-119 Days Past Due	5,529	7,670
120 - 364 Days Past Due	16,742	14,425
365+ Days Past Due	13,011	12,826
Financing Receivable, Individually Evaluated for Impairment	0	0
Originated loans, not subject to risk rating [Member] | Consumer Loan [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	142,492	127,744
0 - 29 Days Past Due	138,340	124,046
30 - 59 Days Past Due	2,123	1,962
60 - 89 Days Past Due	839	652
90-119 Days Past Due	360	443
120 - 364 Days Past Due	301	186
365+ Days Past Due	19	20
Financing Receivable, Individually Evaluated for Impairment	510	435
Originated loans, not subject to risk rating [Member] | Credit Cards [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	15,490	15,241
0 - 29 Days Past Due	14,701	14,555
30 - 59 Days Past Due	263	287
60 - 89 Days Past Due	171	168
90-119 Days Past Due	136	118
120 - 364 Days Past Due	219	113
365+ Days Past Due	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Originated loans, not subject to risk rating [Member] | Overdrafts [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	331	372
0 - 29 Days Past Due	289	322
30 - 59 Days Past Due	28	46
60 - 89 Days Past Due	11	4
90-119 Days Past Due	1	0
120 - 364 Days Past Due	2	0
365+ Days Past Due	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Originated loans, not subject to risk rating [Member] | Unsecured personal lines of credit [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	1,934	1,981
0 - 29 Days Past Due	1,718	1,844
30 - 59 Days Past Due	60	33
60 - 89 Days Past Due	99	38
90-119 Days Past Due	15	25
120 - 364 Days Past Due	35	34
365+ Days Past Due	7	7
Financing Receivable, Individually Evaluated for Impairment	0	0
Originated loans, not subject to risk rating [Member] | Unsecured personal loans [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	108,037	94,560
0 - 29 Days Past Due	105,369	92,102
30 - 59 Days Past Due	1,397	1,272
60 - 89 Days Past Due	512	399
90-119 Days Past Due	195	300
120 - 364 Days Past Due	42	39
365+ Days Past Due	12	13
Financing Receivable, Individually Evaluated for Impairment	510	435
Originated loans, not subject to risk rating [Member] | Cash collateral personal loans [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	16,700	15,590
0 - 29 Days Past Due	16,263	15,223
30 - 59 Days Past Due	375	324
60 - 89 Days Past Due	46	43
90-119 Days Past Due	13	0
120 - 364 Days Past Due	3	0
365+ Days Past Due	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Originated loans, not subject to risk rating [Member] | Auto and Leasing loans receivable [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	447,940	379,874
0 - 29 Days Past Due	399,721	339,817
30 - 59 Days Past Due	33,788	25,532
60 - 89 Days Past Due	8,559	9,437
90-119 Days Past Due	3,461	3,397
120 - 364 Days Past Due	2,411	1,691
365+ Days Past Due	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Accounted For Under ASC 310-20, not subject to risk rating [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	320,914	357,758
0 - 29 Days Past Due	298,374	334,219
30 - 59 Days Past Due	14,679	14,947
60 - 89 Days Past Due	4,386	4,823
90-119 Days Past Due	1,551	1,983
120 - 364 Days Past Due	1,924	1,786
365+ Days Past Due	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Accounted For Under ASC 310-20, not subject to risk rating [Member] | Consumer Loan [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	52,049	56,174
0 - 29 Days Past Due	47,534	50,394
30 - 59 Days Past Due	1,518	2,413
60 - 89 Days Past Due	864	1,207
90-119 Days Past Due	747	888
120 - 364 Days Past Due	1,386	1,272
365+ Days Past Due	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Accounted For Under ASC 310-20, not subject to risk rating [Member] | Credit Cards [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	48,381	52,199
0 - 29 Days Past Due	44,111	46,713
30 - 59 Days Past Due	1,413	2,217
60 - 89 Days Past Due	781	1,200
90-119 Days Past Due	743	828
120 - 364 Days Past Due	1,333	1,241
365+ Days Past Due	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Accounted For Under ASC 310-20, not subject to risk rating [Member] | Unsecured personal loans [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	3,668	3,975
0 - 29 Days Past Due	3,423	3,681
30 - 59 Days Past Due	105	196
60 - 89 Days Past Due	83	7
90-119 Days Past Due	4	60
120 - 364 Days Past Due	53	31
365+ Days Past Due	0	0
Financing Receivable, Individually Evaluated for Impairment	0	0
Accounted For Under ASC 310-20, not subject to risk rating [Member] | Automobile Loan [Member]
Not Subject To Risk Rating [Line Items]
Loans and Leases Receivable, Gross, Carrying Amount	268,865	301,584
0 - 29 Days Past Due	250,840	283,825
30 - 59 Days Past Due	13,161	12,534
60 - 89 Days Past Due	3,522	3,616
90-119 Days Past Due	804	1,095
120 - 364 Days Past Due	538	514
365+ Days Past Due	0	0
Financing Receivable, Individually Evaluated for Impairment	$ 0	$ 0

XML

Guarantees (Changes in liabilty of estimated loss from credit recourse agreement) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Movement In Guaranteed Benefit Liability Gross Roll Forward
Balance at beginning of the period	$ 1,955	$ 0
Additions from acquisition	0	2,460
Net charge-off/terminations	(406)	0
Balance at the end of the period	$ 1,549	$ 2,460

XML

Allowance for Loan and Lease Losses (TDR Pre/Post Modifications) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		12 Months Ended
	Mar. 31, 2014 number	Mar. 31, 2013 number	Dec. 31, 2012 number
Mortgages [Member]
Financing Receivable, Modifications [Line Items]
Number of contracts	34	57	187
Financing Receivable Modifications Pre Modification Recorded Investment	$ 4,009	$ 7,518	$ 24,722
Pre Modification Weighted Average Rate	6.43%	6.28%	6.74%
Pre Modification Weighted Average Term	347 months	331 months	319 months
Financing Receivable Modifications Post Modification Recorded Investment	3,910	8,040	26,620
Post Modification Weighted Average Rate	4.35%	4.35%	5.52%
Post Modification Weighted Average Term	375 months	409 months	385 months
Commercial Loan [Member]
Financing Receivable, Modifications [Line Items]
Number of contracts	0		17
Financing Receivable Modifications Pre Modification Recorded Investment	0		15,642
Pre Modification Weighted Average Rate	0.00%		4.03%
Pre Modification Weighted Average Term	0 months		68 months
Financing Receivable Modifications Post Modification Recorded Investment	0		12,413
Post Modification Weighted Average Rate	0.00%		3.59%
Post Modification Weighted Average Term	0 months		75 months
Consumer Loan [Member]
Financing Receivable, Modifications [Line Items]
Number of contracts	5
Financing Receivable Modifications Pre Modification Recorded Investment	42
Pre Modification Weighted Average Rate	12.97%
Pre Modification Weighted Average Term	67 months
Financing Receivable Modifications Post Modification Recorded Investment	$ 44
Post Modification Weighted Average Rate	12.95%
Post Modification Weighted Average Term	66 months

XML

Income Taxes (Narratives) (Details) (USD $)	3 Months Ended		12 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013
Income Taxes [Abstract]
Changes due to tax law enacted, Description	On June 30, 2013 the Governor signed Act No. 40-2013, known as “Ley de Redistribución y Ajuste de la Carga Contributiva” (Act of Redistribution and Adjustment of Tax Burden), as amended. The main purpose of the Act is to increase government collections in order to alleviate the structural deficit. The most relevant provisions of the Act, as applicable to the Company, and effective for taxable years beginning after December 31,2012 are as follows: (1) the maximum Corporate Income Tax rate was increased from 30% to 39%; (2) the deduction allowed for determining the income subject to surtax was reduced from $750,000 to $25,000 (which must be allocated among the members of a controlled group of corporations); (3) the allowable Net Operating Loss (“NOL”) deduction was reduced to (i) 90% of the corporation’s net income subject to regular tax for purposes of computing the regular income tax, and (ii) 80% of the alternative minimum taxable income for purposes of computing the alternative minimum tax (“AMT”); (4) the NOL carryover period was extended from 10 to 12 years for NOLs incurred in taxable years beginning after December 31, 2004 and before January 1, 2013, and from 7 to 10 years for losses incurred in taxable years beginning after December 31, 2012; (5) a new special tax based on gross income (the “Special Tax”) was added to the Puerto Rico Internal Revenue Code of 2011, as further described below; and (6) a special tax of 1% was imposed on insurance premiums earned after June 30, 2013. In the case of non-financial institutions, the Special Tax is paid as part of the AMT and thus is accounted for under the provisions of ASC 740. The applicable Special Tax rate for non-financial institutions increases gradually from 0.2% for gross income equal to or in excess of $1.0 million up to 0.85% for gross income in excess of $1.5 billion. In the case of a controlled group of corporations, the tax rate for all members of the group is determined by the aggregate gross income of all members in the group. In the case of financial institutions, the Special Tax is not part of the AMT calculation thus is accounted for as other tax not subject to the provisions of ASC 740 since the same is based on gross income. The applicable Special Tax rate for financial institutions is 1% of its gross income of a taxable year, of which fifty percent (50%) may be claimed as a credit against the financial institution’s applicable income tax of that year.
Effective Income Tax Rate Reconciliation State And Local Income Taxes	39.00%
Unrecognized Tax Benefits, Interest on Income Taxes Accrued	$ 4,000,000		$ 4,000,000
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued	1,600,000		1,200,000
Statement [Line Items]
OtherComprehensiveIncomeLossTax	(87,000)		(831,000)
International Banking Entity [Member]
Statement [Line Items]
OtherComprehensiveIncomeLossTax	219,000		356,000
Other Comprehensive Income Loss Reclassification Adjustment From AOCIF or Sale Of Securities Tax	$ 137,000	$ 47,000
IBE Tax Rate	0.00%

XML

Deposits and Related Interest (Tables)

3 Months Ended

Mar. 31, 2014

Deposits, by Component, Alternative [Abstract]

Deposits By Component [Table Text Block]

Total deposits as of March 31, 2014 and December 31, 2013consist of the following:

	March 31,		December 31,
	2014		2013
	(In thousands)
Non-interest bearing demand deposits	$	755,909	$	550,302
Interest-bearing savings and demand deposits		2,604,664		2,683,996
Individual retirement accounts		338,719		347,262
Retail certificates of deposit		556,928		598,367
Institutional certificates of deposit		331,859		375,224
Total core deposits		4,588,079		4,555,151
Brokered deposits		712,913		828,114
Total deposits	$	5,300,992	$	5,383,265

Interest Expense Domestic Deposit Liabilities [Table Text Block]

Interest expense for the quartersended March 31, 2014 and2013 was as follows:

	Quarter Ended March 31,
	2014		2013
	(In thousands)
Demand and savings deposits	$	5,028	$	5,962
Certificates of deposit		3,950		3,973
	$	8,978	$	9,935

Maturities Of Time Deposits [Table Text Block]

Excluding equity indexed options in the amount of $11.1 million, which are used by the Company to manage its exposure to the S&P 500 Index, and also excluding accrued interests of $1.7 million and unamortized deposit discount in the amount of $3.3million, the scheduled maturities of certificates of deposit at March 31, 2014are as follows:

	March 31, 2014
	(In thousands)
Within one year:
Three (3) months or less	$	303,340
Over 3 months through 1 year		780,260
		1,083,600
Over 1 through 2 years		351,142
Over 2 through 3 years		257,750
Over 3 through 4 years		84,607
Over 4 through 5 years		52,029
	$	1,829,128

XML

Loans Receivable (Aging of recorded investment in gross loans) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Loans	$ 4,689,259	$ 4,669,192
Commercial Secured [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing		0
Originated Loans [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	82,967	87,623
60 - 89 Days Past Due	31,810	31,619
90+ Days Past Due	91,172	95,052
Total Past Due	205,949	214,294
Current	2,336,778	2,187,246
Total Loans	2,542,727	2,401,540
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	2,512	2,875
Originated Loans [Member] | Mortgages [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	45,185	52,364
60 - 89 Days Past Due	21,831	19,664
90+ Days Past Due	76,175	74,156
Total Past Due	143,191	146,184
Current	638,959	620,081
Total Loans	782,150	766,265
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	2,512	2,875
Originated Loans [Member] | Traditional loan
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	35,292	39,388
60 - 89 Days Past Due	14,876	12,942
90+ Days Past Due	25,771	23,595
Total Past Due	75,939	75,925
Current	544,401	526,263
Total Loans	620,340	602,188
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	258	690
Originated Loans [Member] | Originated Up To The Year 2002 [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	5,330	6,697
60 - 89 Days Past Due	2,620	1,635
90+ Days Past Due	2,877	3,408
Total Past Due	10,827	11,740
Current	61,269	64,772
Total Loans	72,096	76,512
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	91	79
Originated Loans [Member] | Originated In The Years 2003 And 2004 [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	5,494	4,722
60 - 89 Days Past Due	2,445	2,163
90+ Days Past Due	2,342	1,845
Total Past Due	10,281	8,730
Current	53,234	56,387
Total Loans	63,515	65,117
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Originated In The Year 2005 [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	6,620	8,527
60 - 89 Days Past Due	2,288	2,119
90+ Days Past Due	6,289	4,808
Total Past Due	15,197	15,454
Current	72,621	74,087
Total Loans	87,818	89,541
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Originated In The Year 2006 [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	10,151	12,055
60 - 89 Days Past Due	4,376	4,312
90+ Days Past Due	4,474	4,418
Total Past Due	19,001	20,785
Current	97,903	99,537
Total Loans	116,904	120,322
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Originated In The Years 2007 2008 And 2009 [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	3,807	3,464
60 - 89 Days Past Due	2,025	1,104
90+ Days Past Due	4,850	4,663
Total Past Due	10,682	9,231
Current	87,158	91,919
Total Loans	97,840	101,150
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	152
Originated Loans [Member] | Originated In The Years 2010 2011 2012 2013 And 2014 [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	3,890	3,923
60 - 89 Days Past Due	1,122	1,609
90+ Days Past Due	4,939	4,453
Total Past Due	9,951	9,985
Current	172,216	139,561
Total Loans	182,167	149,546
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	167	459
Originated Loans [Member] | NonTraditional Mortgage [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	1,744	3,217
60 - 89 Days Past Due	470	1,162
90+ Days Past Due	2,425	2,311
Total Past Due	4,639	6,690
Current	35,151	35,412
Total Loans	39,790	42,102
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Loss Mitigation Program [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	8,149	9,759
60 - 89 Days Past Due	6,485	5,560
90+ Days Past Due	12,559	13,191
Total Past Due	27,193	28,510
Current	58,812	57,808
Total Loans	86,005	86,318
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	2,254	2,185
Originated Loans [Member] | Home equity secured personal loans [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	0	0
60 - 89 Days Past Due	0	0
90+ Days Past Due	138	138
Total Past Due	138	138
Current	595	598
Total Loans	733	736
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | GNMA's Buy Back Option related
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	0	0
60 - 89 Days Past Due	0	0
90+ Days Past Due	35,282	34,921
Total Past Due	35,282	34,921
Current	0	0
Total Loans	35,282	34,921
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Commercial Loan [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
Total Loans	1,170,145	1,127,657
Originated Loans [Member] | Commercial Secured [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	1,241	5,609
60 - 89 Days Past Due	277	1,015
90+ Days Past Due	6,311	13,484
Total Past Due	7,829	20,108
Current	404,922	380,453
Total Loans	412,751	400,561
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0
Originated Loans [Member] | Corporate Commercial Secured [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	0	0
60 - 89 Days Past Due	0	0
90+ Days Past Due	0	0
Total Past Due	0	0
Current	62,935	54,796
Total Loans	62,935	54,796
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Institutional Commercial Secured [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	0	0
60 - 89 Days Past Due	0	0
90+ Days Past Due	0	0
Total Past Due	0	0
Current	9,833	4,050
Total Loans	9,833	4,050
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Middle Market Commercial Secured [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	0	1,356
60 - 89 Days Past Due	0	0
90+ Days Past Due	1,531	10,294
Total Past Due	1,531	11,650
Current	168,222	149,933
Total Loans	169,753	161,583
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Retail Commercial Secured [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	1,241	4,253
60 - 89 Days Past Due	277	1,015
90+ Days Past Due	4,780	3,190
Total Past Due	6,298	8,458
Current	150,396	158,184
Total Loans	156,694	166,642
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Floor Plan Commercial Secured [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	0	0
60 - 89 Days Past Due	0	0
90+ Days Past Due	0	0
Total Past Due	0	0
Current	1,699	1,835
Total Loans	1,699	1,835
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Real Estate Commercial Secured [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	0	0
60 - 89 Days Past Due	0	0
90+ Days Past Due	0	0
Total Past Due	0	0
Current	11,837	11,655
Total Loans	11,837	11,655
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Other Commercial and Industrial[Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	609	2,105
60 - 89 Days Past Due	292	851
90+ Days Past Due	2,135	1,673
Total Past Due	3,036	4,629
Current	754,358	722,467
Total Loans	757,394	727,096
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Corporate Other Commercial [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	0	236
60 - 89 Days Past Due	0	0
90+ Days Past Due	0
Total Past Due	0	236
Current	28,475	32,362
Total Loans	28,475	32,598
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Institutional Other Commercial [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	0
60 - 89 Days Past Due	0
90+ Days Past Due	0	0
Total Past Due	0	0
Current	553,249	536,445
Total Loans	553,249	536,445
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Middle Market Other Commercial [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	0	0
60 - 89 Days Past Due	0	299
90+ Days Past Due	513	1,134
Total Past Due	513	1,433
Current	82,420	57,464
Total Loans	82,933	58,897
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Retail Other Commercial [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	609	1,830
60 - 89 Days Past Due	292	552
90+ Days Past Due	1,622	539
Total Past Due	2,523	2,921
Current	64,532	58,589
Total Loans	67,055	61,510
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Floor Plan Other Commercial [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	0	39
60 - 89 Days Past Due	0	0
90+ Days Past Due	0	0
Total Past Due	0	39
Current	25,682	37,607
Total Loans	25,682	37,646
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Consumer Loan [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	2,144	2,014
60 - 89 Days Past Due	851	652
90+ Days Past Due	679	650
Total Past Due	3,674	3,316
Current	138,818	124,428
Total Loans	142,492	127,744
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Credit Cards [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	263	287
60 - 89 Days Past Due	171	168
90+ Days Past Due	354	232
Total Past Due	788	687
Current	14,702	14,554
Total Loans	15,490	15,241
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Overdrafts [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	28	46
60 - 89 Days Past Due	11	4
90+ Days Past Due	4	0
Total Past Due	43	50
Current	288	322
Total Loans	331	372
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Unsecured personal lines of credit [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	60	33
60 - 89 Days Past Due	99	38
90+ Days Past Due	57	66
Total Past Due	216	137
Current	1,718	1,844
Total Loans	1,934	1,981
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Unsecured personal loans [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	1,418	1,324
60 - 89 Days Past Due	524	399
90+ Days Past Due	248	352
Total Past Due	2,190	2,075
Current	105,847	92,485
Total Loans	108,037	94,560
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Cash collateral personal loans [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	375	324
60 - 89 Days Past Due	46	43
90+ Days Past Due	16	0
Total Past Due	437	367
Current	16,263	15,223
Total Loans	16,700	15,590
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Originated Loans [Member] | Auto and Leasing loans receivable [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	33,788	25,531
60 - 89 Days Past Due	8,559	9,437
90+ Days Past Due	5,872	5,089
Total Past Due	48,219	40,057
Current	399,721	339,817
Total Loans	447,940	379,874
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Non-covered acquired loans accounted for under ASC 310-20
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	15,469	17,144
60 - 89 Days Past Due	4,514	6,848
90+ Days Past Due	5,105	5,413
Total Past Due	25,088	29,405
Current	367,403	406,034
Total Loans	392,491	435,439
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Non-covered acquired loans accounted for under ASC 310-20 | Commercial Loan [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	790	2,197
60 - 89 Days Past Due	128	2,025
90+ Days Past Due	1,628	1,646
Total Past Due	2,546	5,868
Current	69,031	71,813
Total Loans	71,577	77,681
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Non-covered acquired loans accounted for under ASC 310-20 | Commercial Secured [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	47	431
60 - 89 Days Past Due	0	331
90+ Days Past Due	704	969
Total Past Due	751	1,731
Current	17,381	16,882
Total Loans	18,132	18,613
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Non-covered acquired loans accounted for under ASC 310-20 | Corporate Commercial Secured [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	0	0
60 - 89 Days Past Due	0	0
90+ Days Past Due	0	0
Total Past Due	0	0
Current	11,079	10,166
Total Loans	11,079	10,166
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Non-covered acquired loans accounted for under ASC 310-20 | Retail Commercial Secured [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	47	431
60 - 89 Days Past Due	0	331
90+ Days Past Due	603	868
Total Past Due	650	1,630
Current	3,651	4,140
Total Loans	4,301	5,770
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Non-covered acquired loans accounted for under ASC 310-20 | Floor Plan Commercial Secured [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	0	0
60 - 89 Days Past Due	0	0
90+ Days Past Due	101	101
Total Past Due	101	101
Current	2,651	2,576
Total Loans	2,752	2,677
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Non-covered acquired loans accounted for under ASC 310-20 | Other Commercial and Industrial[Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	743	1,766
60 - 89 Days Past Due	128	1,694
90+ Days Past Due	924	677
Total Past Due	1,795	4,137
Current	51,650	54,931
Total Loans	53,445	59,068
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Non-covered acquired loans accounted for under ASC 310-20 | Corporate Other Commercial [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	14	14
60 - 89 Days Past Due	0	83
90+ Days Past Due	82	0
Total Past Due	96	97
Current	2,851	9,696
Total Loans	2,947	9,793
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Non-covered acquired loans accounted for under ASC 310-20 | Institutional Other Commercial [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	0
60 - 89 Days Past Due	0
90+ Days Past Due	0
Total Past Due	0
Current	221
Total Loans	221
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0
Non-covered acquired loans accounted for under ASC 310-20 | Retail Other Commercial [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	645	1,717
60 - 89 Days Past Due	128	1,418
90+ Days Past Due	716	659
Total Past Due	1,489	3,794
Current	15,727	23,544
Total Loans	17,216	27,338
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Non-covered acquired loans accounted for under ASC 310-20 | Floor Plan Other Commercial [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	84	35
60 - 89 Days Past Due	0	193
90+ Days Past Due	126	18
Total Past Due	210	246
Current	32,851	21,691
Total Loans	33,061	21,937
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Non-covered acquired loans accounted for under ASC 310-20 | Consumer Loan [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	1,518	2,413
60 - 89 Days Past Due	864	1,207
90+ Days Past Due	2,135	2,159
Total Past Due	4,517	5,779
Current	47,532	50,395
Total Loans	52,049	56,174
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Non-covered acquired loans accounted for under ASC 310-20 | Credit Cards [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	1,413	2,217
60 - 89 Days Past Due	781	1,200
90+ Days Past Due	2,078	2,068
Total Past Due	4,272	5,485
Current	44,109	46,714
Total Loans	48,381	52,199
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Non-covered acquired loans accounted for under ASC 310-20 | Unsecured personal loans [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	105	196
60 - 89 Days Past Due	83	7
90+ Days Past Due	57	91
Total Past Due	245	294
Current	3,423	3,681
Total Loans	3,668	3,975
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	0	0
Non-covered acquired loans accounted for under ASC 310-20 | Automobile Loan [Member]
Financing Receivable, Recorded Investment, Past Due [Line Items]
30 - 59 Days Past Due	13,161	12,534
60 - 89 Days Past Due	3,522	3,616
90+ Days Past Due	1,342	1,608
Total Past Due	18,025	17,758
Current	250,840	283,826
Total Loans	268,865	301,584
Financing Receivable Recorded Investment 90 Days Past Due And Stil lAccruing	$ 0	$ 0

XML

Stockholders' Equity and Earnings Per Common Share

3 Months Ended

Mar. 31, 2014

Stockholders' Equity [Abstract]

STOCKHOLDERS' EQUITY

NOTE 14— STOCKHOLDERS' EQUITY AND EARNINGS PER COMMON SHARE

Regulatory Capital Requirements

The Company (on a consolidated basis) and the Bank are subject to various regulatory capital requirementsadministered by federal and Puerto Rico banking agencies. Failure to meet minimum capital requirements can initiate certainmandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a directmaterial effect on the Company's and the Bank's financial statements. Under capital adequacy guidelines and theregulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of their assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Pursuant to the Dodd-Frank Act, federal banking regulatorshave adopted new capital rules thatbecame effective January 1, 2014 for advanced approaches banking organizations and will become effective January 1,2015 for all other covered organizations (subject to certain phase-in periods through January 1, 2019) and that will replace their general risk-based capital rules, advanced approaches rule, market risk rule, and leverage rules.

Quantitative measures established by regulation to ensure capital adequacy currently require the Company and the Bank tomaintain minimum amounts and ratios (set forth in the following table) of total and Tier 1 capital (as defined inthe regulations) to risk-weighted assets (as defined in the regulations) and of Tier 1 capital to average total assets (asdefined in the regulations). As of March 31, 2014 and December 31, 2013, the Company and the Bank met all capital adequacy requirements to which they are subject. As of March 31, 2014 and December 31, 2013, the Bank is“well capitalized” under the regulatory framework for prompt corrective action. To be categorized as “wellcapitalized,” an institution must maintain minimum total risk-based, Tier 1 risk-based and Tier 1 leverage ratiosas set forth in the following tables.

The Company's and the Bank's actual capital amounts and ratios as of March 31, 2014 and December 31, 2013 are as follows

				Minimum Capital			Minimum to be Well
	Actual			Requirement			Capitalized
	Amount		Ratio	Amount		Ratio		Amount	Ratio
	(Dollars in thousands)
Company Ratios
As of March 31, 2014
Total capital to risk-weighted assets	$	836,168	16.56%	$	404,054	8.00%	$	505,067	10.00%
Tier 1 capital to risk-weighted assets	$	745,619	14.76%	$	202,027	4.00%	$	303,040	6.00%
Tier 1 capital to average total assets	$	745,619	9.51%	$	313,594	4.00%	$	391,993	5.00%
As of December 31, 2013
Total capital to risk-weighted assets	$	827,460	16.16%	$	409,514	8.00%	$	511,893	10.00%
Tier 1 capital to risk-weighted assets	$	736,930	14.35%	$	204,757	4.00%	$	307,136	6.00%
Tier 1 capital to average total assets	$	736,930	9.11%	$	324,910	4.00%	$	406,138	5.00%

				Minimum Capital			Minimum to be Well
	Actual			Requirement			Capitalized
	Amount		Ratio	Amount		Ratio	Amount		Ratio
	(Dollars in thousands)
Bank Ratios
As of March 31, 2014
Total capital to risk-weighted assets	$	805,900	16.02%	$	402,495	8.00%	$	503,119	10.00%
Tier 1 capital to risk-weighted assets	$	715,591	14.22%	$	201,248	4.00%	$	301,871	6.00%
Tier 1 capital to average total assets	$	715,591	9.18%	$	311,659	4.00%	$	389,574	5.00%
As of December 31, 2013
Total capital to risk-weighted assets	$	779,413	15.30%	$	407,637	8.00%	$	509,547	10.00%
Tier 1 capital to risk-weighted assets	$	688,350	13.51%	$	203,819	4.00%	$	305,728	6.00%
Tier 1 capital to average total assets	$	688,350	8.54%	$	322,395	4.00%	$	402,993	5.00%

Additional paid-in capital

Additional paid-in capital represents contributed capital in excess of par value of common and preferred stock net of costs of the issuance. As of March 31, 2014, accumulated issuance costs charged against additional paid in capital amounted to $10.1million and $13.6 million for preferred and common stock, respectively.

Earnings per Common Share

The calculation of earnings per common share for the quartersended March 31, 2014and 2013 is as follows:

	Quarter Ended March 31,
	2014		2013
	(In thousands, except per share data)
Net income	$	23,747	$	21,192
Less: Dividends on preferred stock
Non-Convertible Preferred Stock (Series A, B, and D)		(1,628)		(1,628)
Convertible preferred stock (Series C)		(1,837)		(1,837)
Income available to common shareholders	$	20,282	$	17,727
Effect of assumed conversion of the Convertible Preferred Stock		1,837		1,837
Income available to common shareholders assuming conversion	$	22,119	$	19,564
Weighted average common shares and share equivalents:
Average common shares outstanding		45,329		45,595
Effect of dilutive securities:
Average potential common shares-options		131		159
Average potential common shares-assuming conversion of ' ' convertible preferred stock		7,138		7,138
Total weighted average common shares outstanding ' 'and equivalents		52,598		52,892
Earnings per common share - basic	$	0.45	$	0.39
Earnings per common share - diluted	$	0.42	$	0.37

In computing diluted earnings per common share, the 84,000 shares of convertible preferred stock, which remain outstanding at March31, 2014, with a conversion rate, subject to certain conditions,of 84.9798 shares of common stock per share, were included as average potential common shares from the date they were issued and outstanding. Moreover, in computing diluted earnings per common share, the dividends declared during the quarters ended March 31, 2014 and 2013 on the convertible preferred stock were added back as income available to common shareholders.

For the quarters ended March 31, 2014 and 2013, weighted-average stock options with an anti-dilutive effect on earnings per share not included in the calculation amounted to 254,662, and653,843, respectively

Treasury Stock

Under the Company's current stock repurchase program it is authorized to purchase in the open market up to $70 million of its outstanding shares of common stock, of which approximately $23.1 million of authority remains. The shares of common stock repurchased are to be held by the Company as treasury shares. During the quarter ended March 31, 2014, the Company purchased 707,400 shares under this program for a total of $10.4 million, at an average price of $14.66 per share. There were no repurchases during 2013.

The following table presents the shares repurchased for each month in the quarter ended March 31, 2014, excluding the month ended March 31, 2014, during which no shares were purchased as part of the stock repurchase program:

	Total number of				Dollar amount of
	shares purchased as		Average		shares repurchased
		part of stock	price paid		(excluding
	repurchase programs		per share		commissions paid)
						(In thousands)
Period
January 2014		57,700	$	14.73	$	850
February 2014		649,700	$	14.66	$	9,522
Quarter ended March 31, 2014		707,400		14.66		10,372

The number of shares that may yet be purchased under the $70 million program is estimated at 1,341,002and was calculated by dividing the remaining balance of $23.1million by $17.19 (closing price of the Company common stock at March 31, 2014). The Company did not purchase any shares of its common stock other than through its publicly announced stock repurchase program during the quarter ended March 31, 2014.

The activity in connection with common shares held in treasury by the Company for quarters ended March 31, 2014 and 2013 is set forth below:

	Quarter Ended March 31,
	2014			2013
		Dollar			Dollar
	Shares	Amount		Shares	Amount
	(In thousands, except shares data)
Beginning of year	7,030,101	$	80,642	7,090,597	$	81,275
Common shares used upon lapse of restricted stock units	(27,752)		(292)	(33,600)		(351)
Common shares repurchased as part of the stock repurchase program	707,400		10,393	-		-
Common shares used to match defined contribution plan, net	-		-	(7,318)		(77)
End of year	7,709,749	$	90,743	7,049,679	$	80,847

Accumulated Other Comprehensive Income

Accumulated other comprehensive income, net of income tax, as of March 31, 2014 and December 31, 2013 consisted of:

	March 31,		December 31,
	2014		2013
	(In thousands)
Unrealized gain on securities available-for-sale which are not other-than-temporarily impaired	$	18,464	$	13,267
Income tax effect of unrealized gain on securities available-for-sale		(2,429)		(1,834)
Net unrealized gain on securities available-for-sale which are not other-than-temporarily impaired		16,035		11,433
Unrealized loss on cash flow hedges		(10,529)		(10,907)
Income tax effect of unrealized loss on cash flow hedges		2,516		2,665
Net unrealized loss on cash flow hedges		(8,013)		(8,242)
Accumulated other comprehensive income, net of taxes	$	8,022	$	3,191

The following table presents changes in accumulated other comprehensive income by component, net of taxes, for the quartersendedMarch 31, 2014 and 2013:

	Quarter Ended March 31,
	2014						2013
	Net unrealized		Net unrealized		Accumulated		Net unrealized		Net unrealized		Accumulated
	gains on		loss on		other		gains on		loss on		other
	securities		cash flow		comprehensive		securities		cash flow		comprehensive
	available-for-sale		hedges		income		available-for-sale		hedges		income
	(In thousands)						(In thousands)
Beginning balance	$	11,433	$	(8,242)	$	3,191	$	68,245	$	(12,365)	$	55,880
Other comprehensive income before reclassifications		4,465		(1,392)		3,073		(9,899)		(313)		(10,212)
Amounts reclassified out of accumulated other comprehensive income		137		1,621		1,758		47		1,336		1,383
Other comprehensive income (loss)		4,602		229		4,831		(9,852)		1,023		(8,829)
Ending balance	$	16,035	$	(8,013)	$	8,022	$	58,393	$	(11,342)	$	47,051

The following table presents reclassifications out of accumulated other comprehensive income forthe quarters ended March 31, 2014 and 2013:

					Affected Line Item in
	Quarter ended March 31,				Consolidated Statement
	2014		2013		of Operations
	(In thousands)
Cash flow hedges:
Interest-rate contracts	$	1,621	$	1,336	Net interest expense
Available-for-sale securities:
Residual tax effect from OIB's change in applicable tax rate		137		47	Income tax expense
	$	1,758	$	1,383

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Basis of Presentation (Policies)

3 Months Ended

Mar. 31, 2014

Accounting Policies [Abstract]

New Accounting Pronouncements Policy [Policy Text Block]

Recent Accounting Developments

Reclassification of Defaulted Consumer Mortgage Loans upon Foreclosure - In January 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-04, Receivables—Troubled Debt Restructurings by Creditors (Subtopic 310-40): Reclassification of Residential Real Estate Collateralized Consumer Mortgage Loans upon Foreclosure. This ASU clarifies when an in-substance repossession or foreclosure occurs that would require a transfer of the mortgage loan to other real estate owned (OREO). Under the ASU, repossession or foreclosure is deemed to have occurred when (1) the creditor obtains legal title to the residential real estate property or (2) the borrower conveys all interest in the residential real estate property to the creditor to satisfy the mortgage loan through completion of a deed in lieu of foreclosure or a similar legal agreement. The ASU will become effective for annual and interim periods beginning after December 15, 2014. The ASU can be adopted using either a modified retrospective method or a prospective transition method with the cumulative effect being recognized in the beginning retained earnings of the earliest annual period for which the ASU is adopted. The adoption of this guidance will not have a material effect on our consolidated financial statements, since the Company already follows the same basis approach.

Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carry-forward, a Similar Tax Loss, or a Tax Credit Carry-forward ExistsIn July 2013, FASB issued ASU No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carry-forward, a Similar Tax Loss, or a Tax Credit Carry-forward Exists (a consensus of the FASB Emerging Issues Task, which requires that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. When a net operating loss, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional taxes that would result from the disallowance of a tax position, or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purposes, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The assessment of whether a deferred tax asset is available is based on the unrecognized tax benefit and deferred tax asset that exist at the reporting date and should be made presuming disallowance of the tax position at the reporting date. Currently, there is no explicit guidance under U.S. GAAP on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The amendment of this guidance does not require new recurring disclosures. ASU 2013-11 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. Early adoption is permitted. The amendments of this ASU should be applied prospectively to all unrecognized tax benefits that exist at the effective date. Retrospective application is permitted. The adoption of this guidance did not have a material effect on our consolidated financial statements, since the Company already followed the same basis approach.

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Stockholders' Equity (Common shares held in treasury, activity) (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Stockholders' Equity Note [Abstract]
Beginning of period	7,030,101	7,090,597
Common shares used for exercise of restricted stock units (Shares)	(27,752)	(33,600)
Common shares repurchased as part of the stock repurchase program (Shares)	707,400	0
Common shares used to match defined contribution plan, net	0	(7,318)
End of period	7,709,749	7,049,679
Beginning of period	$ 80,642	$ 81,275
Common shares used for exercise of restricted stock units (Value)	(292)	(351)
Stock purchased under the repurchase program	10,393	0
Common shares used to match defined contribution plan, net (Value)	0	(77)
End of period	$ 90,743	$ 80,847

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Loans Receivable (Narratives) (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Accounts Notes And Loans Receivable Line Items
Financing Receivable Modifications Recorded Investment Not Included In Non Accrual	$ 70.8	$ 66.5
Loans Granted To Puerto Rico Government	539.9
Acquired Loans Under ASC 310-30 granted to the Puerto Rico Government	196.1	180.5
Mortgage held for sale reclassified to mortgage held for investment	$ 23.5

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Commitments (Future rental commitments under leases) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014
Operating Leases, Future Minimum Payments Due [Abstract]
2014	$ 6,170
2015	8,013
2016	7,388
2017	6,761
2018	5,864
Thereafter	22,004
Total	$ 56,200

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Fair Value of Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2014

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract]

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis 1 [Table Text Block]

Assets and liabilities measured at fair value on a recurring and non-recurring basis, including financial liabilitiesfor which the Company has elected the fair value option, are summarized below:

	March 31, 2014
	Fair Value Measurements
	Level 1		Level 2		Level 3		Total
	(In thousands)
Recurring fair value measurements:
Investment securities available-for-sale	$	-	$	1,435,632	$	20,053	$	1,455,685
Money market investments		7,652		-		-		7,652
Derivative assets		-		3,306		12,555		15,861
Servicing assets		-		-		13,970		13,970
Derivative liabilities		-		(13,830)		(12,120)		(25,950)
	$	7,652	$	1,425,108	$	34,458	$	1,467,218
Non-recurring fair value measurements:
Impaired commercial loans	$	-	$	-	$	27,975	$	27,975
Foreclosed real estate		-		-		96,884		96,884
	$	-	$	-	$	124,859	$	124,859

	December 31, 2013
	Fair Value Measurements
	Level 1		Level 2		Level 3		Total
	(In thousands)
Recurring fair value measurements:
Investment securities available-for-sale	$	-	$	1,568,745	$	19,680	$	1,588,425
Securities purchased under agreements to resell		-		60,000		-		60,000
Money market investments		6,967		-		-		6,967
Derivative assets		-		4,072		16,430		20,502
Servicing assets		-		-		13,801		13,801
Derivative liabilities		-		(14,937)		(15,736)		(30,673)
	$	6,967	$	1,617,880	$	34,175	$	1,659,022
Non-recurring fair value measurements:
Impaired commercial loans	$	-	$	-	$	28,353	$	28,353
Foreclosed real estate		-		-		90,024		90,024
	$	-	$	-	$	118,377	$	118,377

Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Table Text Block]

The table below presents a reconciliation of all assets and liabilities measured at fair value on a recurring basisusing significant unobservable inputs (Level 3) for the quarters ended March31, 2014 and 2013:

	Quarter Ended March 31, 2014
				Derivative				Derivative
		Other		asset				liability
		debt		(S&P				(S&P
		securities		Purchased		Servicing		Embedded
Level 3 Instruments Only		available-for-sale		Options)		assets		Options)		Total
	(In thousands)
Balance at beginning of year		$	19,680	$	16,430	$	13,801	$	(15,736)	$	34,175
Gains (losses) included in earnings			-		(3,875)		-		3,373		(502)
Changes in fair value of investment securities available for sale included in other comprehensive income			373		-		-		-		373
New instruments acquired			-		-		563		-		563
Principal repayments			-		-		(196)		-		(196)
Amortization			-		-		-		243		243
Changes in fair value of servicing assets			-		-		(198)		-		(198)
Balance at end of year		$	20,053	$	12,555	$	13,970	$	(12,120)	$	34,458

	Quarter Ended March 31, 2013
	Investment securities
	available-for-sale
					Derivative				Derivative
					asset				liability
			Other		(S&P				(S&P
			debt		Purchased		Servicing		Embedded
Level 3 Instruments Only	CLOs		securities		Options)		assets		Options)		Total
Balance at beginning of period	$	27,280	$	10,016	$	11,367	$	10,776	$	(10,912)	$	48,527
Gains (losses) included in earnings		-		-		1,721		-		(1,707)		14
Changes in fair value of investment securities available for sale included in other comprehensive income		1,705		1		-		-		-		1,706
New instruments acquired		-		-		-		487		-		487
Principal repayments		-		-		-		(307)		-		(307)
Amortization		17		-		-		-		50		67
Changes in fair value of servicing assets		-		-		-		(314)		-		(314)
Balance at end of period	$	29,002	$	10,017	$	13,088	$	10,642	$	(12,569)	$	50,180

	March 31, 2014
	Fair Value		Valuation Technique	Unobservable Input	Range
	(In thousands)
Investment securities available-for-sale:
Other debt securities	$	20,053	Market comparable bonds	Indicative pricing	97.125% - 98.975%
				Option adjusted spread	683.7% - 1602.0%
				Yield to maturity	7.05% - 15.89%
				Spread to maturity	689.9% - 1579.0%
Derivative assets (S&P Purchased Options)	$	12,555	Option pricing model	Implied option volatility	22.887% - 53.615%
				Counterparty credit risk (based on 5-year credit default swap ("CDS") spread)	56.360% - 86.490%
Servicing assets	$	13,970	Cash flow valuation	Constant prepayment rate	5.60% - 10.08%
				Discount rate	10.00% - 12.00%
Derivative liability (S&P Embedded Options)	$	(12,120)	Option pricing model	Implied option volatility	22.887% - 53.615%
				Counterparty credit risk (based on 5-year CDS spread)	56.360% - 86.490%
Collateral dependant impaired loans	$	27,975	Fair value of property or collateral	Appraised value less disposition costs	21.30% - 28.30%

Available-for-sale Securities Classified As Level 3 [Table Text Block]

The table below presents a detail of investment securities available-for-sale classified as Level 3 at March 31,2014:

	March 31, 2014
							Weighted
	Amortized		Unrealized				Average	Principal
Type	Cost		Gains (Losses)		Fair Value		Yield	Protection
	(In thousands)
Other debt securities	$	20,000	$	53	$	20,053	3.50%	N/A

Fair Value By Balance Sheet Grouping [Text Block]

The estimated fair value and carrying value of the Company's financial instruments at March 31, 2014 and December 31, 2013 is as follows:

	March 31,				December 31,
	2014				2013
	Fair		Carrying		Fair		Carrying
	Value		Value		Value		Value
	(In thousands)
Level 1
Financial Assets:
Cash and cash equivalents	$	624,636	$	624,636	$	621,269	$	621,269
Restricted cash		15,170		15,170		82,199		82,199
Level 2
Financial Assets:
Securities purchased under agreements to resell		-		-		60,000		60,000
Trading securities		1,910		1,910		1,869		1,869
Investment securities available-for-sale		1,435,632		1,435,632		1,568,745		1,568,745
Federal Home Loan Bank (FHLB) stock		24,430		24,430		24,450		24,450
Derivative assets		3,306		3,306		4,072		4,072
Derivative liabilities		13,830		13,830		14,937		14,937
Level 3
Financial Assets:
Investment securities available-for-sale		20,053		20,053		19,680		19,680
Total loans (including loans held-for-sale)
Non-covered loans, net		4,737,604		4,654,749		4,857,505		4,662,458
Covered loans, net		400,355		347,865		459,444		356,961
Derivative assets		12,555		12,555		16,430		16,430
FDIC shared-loss indemnification asset		106,170		166,194		152,965		189,240
Accrued interest receivable		18,969		18,969		18,734		18,734
Servicing assets		13,970		13,970		13,801		13,801
Financial Liabilities:
Deposits		5,247,226		5,300,992		5,409,540		5,383,265
Securities sold under agreements to repurchase		1,076,000		1,012,240		1,323,903		1,267,618
Advances from FHLB		340,805		335,689		335,324		336,143
Federal funds purchased		23,712		23,712		-		-
Term notes		3,583		3,708		3,638		3,663
Subordinated capital notes		87,240		100,404		99,316		100,010
Accrued expenses and other liabilities		140,037		140,037		144,424		144,424

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Fair Value (Reconciliation of assets and liabilities using significant unobservable inputs (Level 3)) (Details) (Fair Value, Measurements, Recurring [Member], USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance	$ 34,175	$ 48,527
Gains (losses) included in earnings	(502)	14
Changes in fair value of investment securities available for sale included in other comprehensive income	373	1,706
New instruments acquired	563	487
Principal repayments	(196)	(307)
Amortization	243	67
Sale of instruments	0
Changes in fair value of servicing assets	(198)	(314)
Balance	34,458	50,180
Collateralized Mortgage Obligations [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance		27,280
Gains (losses) included in earnings		0
Changes in fair value of investment securities available for sale included in other comprehensive income		1,705
New instruments acquired		0
Principal repayments		0
Amortization		17
Changes in fair value of servicing assets		0
Balance		29,002
Other Debt Obligations [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance	19,680	10,016
Gains (losses) included in earnings	0	0
Changes in fair value of investment securities available for sale included in other comprehensive income	373	1
New instruments acquired	0	0
Principal repayments	0	0
Amortization	0	0
Sale of instruments	0
Changes in fair value of servicing assets	0	0
Balance	20,053	10,017
Derivative Financial Instruments, Assets [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance	16,430	11,367
Gains (losses) included in earnings	(3,875)	1,721
Changes in fair value of investment securities available for sale included in other comprehensive income	0	0
New instruments acquired	0	0
Principal repayments	0	0
Amortization	0	0
Sale of instruments	0
Changes in fair value of servicing assets	0	0
Balance	12,555	13,088
Servicing Assets [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance	13,801	10,776
Gains (losses) included in earnings	0	0
Changes in fair value of investment securities available for sale included in other comprehensive income	0	0
New instruments acquired	563	487
Principal repayments	(196)	(307)
Amortization	0	0
Sale of instruments	0
Changes in fair value of servicing assets	(198)	(314)
Balance	13,970	10,642
Derivative Financial Instruments, Liabilities [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance	(15,736)	(10,912)
Gains (losses) included in earnings	3,373	(1,707)
Changes in fair value of investment securities available for sale included in other comprehensive income	0	0
New instruments acquired	0	0
Principal repayments	0	0
Amortization	243	50
Sale of instruments	0
Changes in fair value of servicing assets	0	0
Balance	$ (12,120)	$ (12,569)

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Consolidated Statements of Comprehensive Income (Loss) (Unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014	Mar. 31, 2013
Consolidated Statements of Comprehensive Income (Loss) [Abstract]
Net income	$ 23,747	$ 21,192
Other comprehensive income (loss) before tax:
Unrealized gain (loss) on securities available-for-sale	9,563	(10,992)
Realized gain on investment securities included in net income	(4,366)	0
Unrealized gain (loss) on cash flow hedges	378	1,462
Other comprehensive income (loss) before taxes	5,575	(9,530)
Income tax effect	(744)	701
Other Comprehensive Income (Loss) After taxes	4,831	(8,829)
Comprehensive income	$ 28,578	$ 12,363

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Borrowings (Federal fund purchased) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Disclosure Of Federal Fund Purchased [Line Items]
Federal Funds Purchased	$ 23,712	$ 0

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Securities Purchased Under Agreements And Investments

3 Months Ended

Mar. 31, 2014

Investments [Abstract]

Securities purchased under agreement to resell and investments

NOTE 3–SECURITIES PURCHASED UNDER AGREEMENTS TO RESELL AND INVESTMENTS

Money Market Investments

The Company considers as cash equivalents all money market instruments that are not pledged and that havematurities of three months or less at the date of acquisition. At March 31, 2014 and December 31, 2013, money market instruments included as part of cash and cash equivalents amounted to $7.7million and $7.0 million,respectively.

Securities Purchased Under Agreements to Resell

Securities purchased under agreements to resell consist of short-term investmentsand are carried at the amounts at which the assets will be subsequently resold as specified in the respective agreements. AtDecember 31, 2013, securities purchased under agreements to resell amounted to $60.0 million.At March 31, 2014, there were no securities purchased under agreements to resell.

The amounts advanced under those agreements are reflected as assets in the consolidated statements of financial condition. It is the Company's policy to take possession of securities purchased under agreements to resell. Agreements with third parties specify the Company's right to request additional collateral based on its monitoring of the fair value of the underlying securities on a daily basis.The fair value of the collateral securities held by the Company on these transactions as ofDecember 31, 2013was approximately $64.6million.

Investment Securities

The amortized cost, gross unrealized gains and losses, fair value, and weighted average yield of the securitiesowned by the Company at March 31, 2014 and December 31, 2013 were as follows:

	March 31, 2014
			Gross		Gross				Weighted
	Amortized		Unrealized		Unrealized		Fair		Average
	Cost		Gains		Losses		Value		Yield
	(In thousands)
Available-for-sale
Mortgage-backed securities
FNMA and FHLMC certificates	$	1,093,717	$	31,769	$	4,690	$	1,120,796		3.03%
GNMA certificates		6,146		426		23		6,549		4.93%
CMOs issued by US Government-sponsored agencies		211,308		351		4,139		207,520		1.78%
Total mortgage-backed securities		1,311,171		32,546		8,852		1,334,865		2.84%
Investment securities
US Treasury securities		70,000		-		-		70,000		0.03%
Obligations of US Government-sponsored agencies		9,539		-		42		9,497		1.23%
Obligations of Puerto Rico Government and political subdivisions		22,367		-		5,298		17,069		5.32%
Other debt securities		24,029		225		-		24,254		3.46%
Total investment securities		125,935		225		5,340		120,820		1.72%
Total securities available for sale	$	1,437,106	$	32,771	$	14,192	$	1,455,685		2.74%

	December 31, 2013
			Gross		Gross				Weighted
	Amortized		Unrealized		Unrealized		Fair		Average
	Cost		Gains		Losses		Value		Yield
	(In thousands)
Available-for-sale
Mortgage-backed securities
FNMA and FHLMC certificates	$	1,190,910	$	33,089	$	6,669	$	1,217,330		2.93%
GNMA certificates		7,406		433		24		7,815		4.92%
CMOs issued by US Government-sponsored agencies		220,801		407		6,814		214,394		1.78%
Total mortgage-backed securities		1,419,117		33,929		13,507		1,439,539		2.76%
Investment securities
Obligations of US Government-sponsored agencies		10,691		-		42		10,649		1.21%
Obligations of Puerto Rico Government and political subdivisions		121,035		-		6,845		114,190		4.38%
Other debt securities		24,200		167		320		24,047		3.46%
Total investment securities		155,926		167		7,207		148,886		2.99%
Total securities available-for-sale	$	1,575,043	$	34,096	$	20,714	$	1,588,425		2.89%

The amortized cost and fair value of the Company's investment securities at March 31, 2014, by contractual maturity, are shown in the next table. Securities not due on a single contractual maturity date, such as collateralized mortgage obligations, are classified in the period of final contractual maturity. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

	March 31, 2014
	Available-for-sale
	Amortized Cost		Fair Value
	(In thousands)
Mortgage-backed securities
Due after 5 to 10 years
FNMA and FHLMC certificates	$	26,294	$	26,625
Total due after 5 to 10 years		26,294		26,625
Due after 10 years
FNMA and FHLMC certificates		1,067,423		1,094,171
GNMA certificates		6,146		6,549
CMOs issued by US Government-sponsored agencies		211,308		207,520
Total due after 10 years		1,284,877		1,308,240
Total mortgage-backed securities		1,311,171		1,334,865
Investment securities
Due in less than one year
US Treasury securities		70,000		70,000
Other debt securities		20,000		20,053
Total due in less than one year		90,000		90,053
Due from 1 to 5 years
Obligations of Puerto Rico Government and political subdivisions		11,903		9,827
Total due from 1 to 5 years		11,903		9,827
Due after 5 to 10 years
Obligations of US Government and sponsored agencies		9,539		9,497
Total due after 5 to 10 years		9,539		9,497
Due after 10 years
Obligations of Puerto Rico Government and political subdivisions		10,464		7,242
Other debt securities		4,029		4,201
Total due after 10 years		14,493		11,443
Total investment securities		125,935		120,820
Total securities available-for-sale	$	1,437,106	$	1,455,685

At December 31, 2013 obligations of Puerto Rico Government and political subdivisions includeda $98.7 millionprincipal amount, LIBORfloating ratebond with maturity date of July 1, 2024, that was subject to mandatory tender for purchase by the end of the third year anniversary of the closing date, which was June 1, 2014. The bond was also subject to optional demand tender for purchase upon the occurrence and continuance of certain events, including (among others) the withdrawal, suspension or reduction below investment grade of the credit rating on any general obligation of the Commonwealth by any of the three major rating agencies. This bond was repaid by the issuer on March 1, 2014.

The Company, as part of its asset/liability management, may purchase U.S. Treasury securities and U.S. government-sponsored agency discount notes close to their maturities as alternatives to cash deposits at correspondent banks or as a short term vehicle to reinvest the proceeds of sale transactions until investment securities with attractive yields can be purchased.During the quarter ended March 31, 2014, the Company sold $24.0 million of available-for-sale GNMA certificates that were sold as part of its recurring mortgage loan origination and securitization activities. These sales did not realize any gains or losses during such period. In addition, during the quarter ended March 31, 2014, there were certain sales of available-for-sale securities because the Company believed that gains could be realized and that there were good opportunities to invest the proceeds in other investment securities with attractive yields and terms that would allow the Company to continue protecting its net interest margin.

For the quarter ended March 31, 2014 the Company recorded a net gain on sale of securities of $4.4 million. The tables below present the gross realized gains by category for such period.There was no realized gain or loss for the quarter ended March 31, 2013.

	Quarter Ended March 31, 2014
			Book Value		Gross		Gross
Description	Sale Price		at Sale		Gains		Losses
	(In thousands)
Sale of securities available-for-sale
Mortgage-backed securities
FNMA and FHLMC certificates	$	115,159	$	110,792	$	4,366	$	-
GNMA certificates		23,993		23,993		-		-
Total	$	139,152	$	134,785	$	4,366	$	-

The following tables show the Company's gross unrealized losses and fair value of investment securities available-for-sale, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at March 31, 2014 and December 31, 2013:

	March 31, 2014
	12 months or more
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
CMOs issued by US Government-sponsored agencies	$	1,897	$	163	$	1,734
Obligations of Puerto Rico Government and political subdivisions		22,367		5,298		17,069
GNMA certificates		80		10		70
	$	24,344	$	5,471	$	18,873
	Less than 12 months
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
CMOs issued by US Government-sponsored agencies	$	177,882	$	3,976	$	173,906
FNMA and FHLMC certificates		214,926		4,690		210,236
Obligations of US government and sponsored agencies		9,539		42		9,497
GNMA certificates		121		13		108
	$	402,468	$	8,721	$	393,747
	Total
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
CMOs issued by US Government-sponsored agencies	$	179,779	$	4,139	$	175,640
FNMA and FHLMC certificates		214,926		4,690		210,236
Obligations of Puerto Rico Government and political subdivisions		22,367		5,298		17,069
Obligations of US government and sponsored agencies		9,539		42		9,497
GNMA certificates		201		23		178
	$	426,812	$	14,192	$	412,620

	December 31, 2013
	12 months or more
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
Obligations of Puerto Rico Government and political subdivisions	$	20,845	$	5,470	$	15,375
CMOs issued by US Government-sponsored agencies		2,559		237		2,322
GNMA certificates		81		11		70
	$	23,485	$	5,718	$	17,767
	Less than 12 months
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
Obligations of Puerto Rico Government and political subdivisions	$	100,190	$	1,375	$	98,815
CMOs issued by US Government-sponsored agencies		182,661		6,577		176,084
GNMA certificates		122		13		109
FNMA and FHLMC certificates		220,913		6,669		214,244
Obligations of US Government and sponsored agencies		10,691		42		10,649
Other debt securities		20,000		320		19,680
	$	534,577	$	14,996	$	519,581
	Total
	Amortized		Unrealized		Fair
	Cost		Loss		Value
	(In thousands)
Securities available-for-sale
Obligations of Puerto Rico Government and political subdivisions	$	121,035	$	6,845	$	114,190
CMOs issued by US Government-sponsored agencies		185,220		6,814		178,406
GNMA certificates		203		24		179
FNMA and FHLMC certificates		220,913		6,669		214,244
Obligations of US Government and sponsored agencies		10,691		42		10,649
Other debt securities		20,000		320		19,680
	$	558,062	$	20,714	$	537,348

The valuations of the investment securities are performed on a monthly basis. Moreover, the Company conducts quarterly reviews to identify and evaluate each investment in an unrealized loss position for other-than-temporary impairment.Any portion of a decline in value associated with credit loss is recognized in income with the remaining noncredit-related component recognized in other comprehensive income. A credit loss is determined by assessing whether the amortized cost basis of the security will be recovered by comparing the present value of cash flows expected to be collected from the security, discounted at the rate equal to the yield used to accrete current and prospective beneficial interest for the security. The shortfall of the present value of the cash flows expected to be collected in relation to the amortized cost basis is considered to be the “credit loss.” Other-than-temporary impairment analysis is based on estimates that depend on market conditionsand are subject to further change over time. In addition, while the Company believes that the methodology used to value these exposures is reasonable, the methodology is subject to continuing refinement, including those made as a result of market developments. Consequently, it is reasonably possible that changes in estimates or conditions could result in the need to recognize additional other-than-temporary impairment charges in the future.

Most of the investments in an unrealized loss position at March 31, 2014($404.4million or 95%) consist of securities issued or guaranteed by the U.S. Treasury or U.S. government-sponsored agencies, all of which are highly liquid securities that have a large and efficient secondary market.Their aggregate losses and their variability from period to period are the result of changes in market conditions, and not due to the repayment capacity or creditworthiness of the issuers or guarantors of such securities.

The remaining investments in an unrealized loss position at March 31, 2014 ($22.4 million or 5%) consist of obligations issued or collateralized by the government of Puerto Rico and its political subdivisions or instrumentalities. The recent decline in the market value of these securities is mainly attributed to an increase in volatility as a result of changes in market conditions that reflect the significant economic and fiscal challenges that Puerto Rico is facing, including a protracted economic recession, sizable government debt-service obligations and structural budget deficits, high unemployment and a shrinking population. As of March 31, 2014, the Company analyzed these investments under a plausible set of scenarios that included the possibility of a further downgrade in the credit ratings of the Commonwealth, and also considered numerous factors that, in the Company's view, support the ability of the Commonwealth to continue servicing its debt obligations. Such factors include (i) the collateralization and sources of repayment for such debt obligations; (ii) the government's efforts to increase revenues and reduce expenses to tackle its recurrent budget deficits; (iii) the Commonwealth's constitutional framework that provides that “public debt” (e.g., general obligation bonds such as the $98.7 million principal amount Puerto Rico government bond owned by the Company, and repaid by the issuer on March 1, 2014) constitutes a first claim on available Commonwealth resources; and (iv) the Commonwealth's compliance and commitment to its contractual debt obligations. In addition, the Company believes it is probable that it will collect all amounts due according to the contractual terms of its Puerto Rico government bonds. Based on these factors, the Company expects that such bonds will be repaid in full when due, and given that the Company does not have the intent to sell any such bonds in an unrealized loss position, the Company does not consider them to be other-than-temporarily impaired as of March 31, 2014.

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Allowance for Loan and Lease Losses (Composition of the Company's allowance for loan and lease losses) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2013	Dec. 31, 2012
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	$ 56,183	$ 54,298
Loans And Leases Receivable Allowance, Covered	54,398	52,729	52,974	54,124
Loans And Leases Receivable Allowance Covered and Not Covered	110,581	107,027
Non Covered Loan [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	56,183	54,298
Originated Loans [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	49,507	49,081
Originated Loans [Member] | Residential Portfolio Segment
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	19,511	19,937
Originated Loans [Member] | Commercial Portfolio Segment
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	13,994	14,897
Originated Loans [Member] | Consumer Portfolio Segment
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	7,135	6,006
Originated Loans [Member] | Auto and Leasing Portfolio Segment [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	8,731	7,866
Originated Loans [Member] | Unallocated Financing Receivables
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	136	375
Non-covered acquired loans accounted for under ASC 310-20
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	3,618	2,354
Non-covered acquired loans accounted for under ASC 310-20 | Commercial Portfolio Segment
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	867	926
Non-covered acquired loans accounted for under ASC 310-20 | Consumer Portfolio Segment
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	504	0
Non-covered acquired loans accounted for under ASC 310-20 | Auto and Leasing Portfolio Segment [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	2,247	1,428
Accounted for under ASC 310-30 [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	3,058	2,863
Accounted for under ASC 310-30 [Member] | Residential Portfolio Segment
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	0	0
Accounted for under ASC 310-30 [Member] | Commercial Portfolio Segment
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	2,653	1,713
Accounted for under ASC 310-30 [Member] | Consumer Portfolio Segment
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	405	418
Accounted for under ASC 310-30 [Member] | Construction
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	0	0
Accounted for under ASC 310-30 [Member] | Automobile Loan [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Allowance for loan and lease losses, non covered	0	732
Acquired Loans In An F D I C Assisted Transaction [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans And Leases Receivable Allowance, Covered	54,398	52,729
Acquired Loans In An F D I C Assisted Transaction [Member] | Consumer Portfolio Segment
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans And Leases Receivable Allowance, Covered	615	615
Acquired Loans In An F D I C Assisted Transaction [Member] | Loans Secured by multi-family properties [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans And Leases Receivable Allowance, Covered	14,221	12,495
Acquired Loans In An F D I C Assisted Transaction [Member] | Construction and development secured by multi-family properties [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans And Leases Receivable Allowance, Covered	0	0
Acquired Loans In An F D I C Assisted Transaction [Member] | Commercial and Other Construction [Member]
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans And Leases Receivable Allowance, Covered	39,562	39,619
Acquired Loans In An F D I C Assisted Transaction [Member] | Leasing
Financing Receivable, Allowance for Credit Losses [Line Items]
Loans And Leases Receivable Allowance, Covered	$ 0	$ 0

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Borrowings (Narrative) (Details) (USD $)	3 Months Ended	12 Months Ended
	Mar. 31, 2014	Dec. 31, 2013
Debt Instrument [Line Items]
Other borrowings	$ 3,708,000	$ 3,663,000
Federal Home Loan Bank Advances [Member]
Debt Instrument [Line Items]
Loans Receivable, Gross, Commercial, Mortgage	1,200,000,000	1,300,000,000
Additional Borrowing Capacity	614,100,000	674,200,000
Weighted average period remaining maturity of FHLB advances	10.7 months	11.3 months
Interest Payable	327,000
Unsecured Debt [Member]
Debt Instrument [Line Items]
Debt, Weighted Average Interest Rate	3.00%	3.00%
Other borrowings	1,700,000	1,700,000
Index Appreciation	995,000	957,000
Term Notes
Debt Instrument [Line Items]
Other borrowings	1,000,000	1,000,000
Repurchase agreement
Debt Instrument [Line Items]
Interest Payable	$ 2,200,000	$ 2,600,000
Federal Funds Purchased Member
Debt Instrument [Line Items]
Debt, Weighted Average Interest Rate	0.24%

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Fair Value (Assets and liabilities on recurring and non-recurring basis) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2014	Dec. 31, 2013
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	$ 1,455,685	$ 1,588,425
Money Market Funds, at Carrying Value	7,652	6,967
Derivative Assets	15,861	20,502
Servicing Assets	13,970	13,801
Derivative liabilities	(13,830)	(14,937)
Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	1,435,632	1,568,745
Securities purchased under agreements to resell	0	60,000
Derivative Assets	3,306	4,072
Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	20,053	19,680
Derivative Assets	12,555	16,430
Servicing Assets	13,970	13,801
Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	1,455,685	1,588,425
Securities purchased under agreements to resell	0	60,000
Money Market Funds, at Carrying Value	7,652	6,967
Derivative Assets	15,861	20,502
Servicing Assets	13,970	13,801
Derivative liabilities	(25,950)	(30,673)
Total	1,467,218	1,659,022
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	0	0
Securities purchased under agreements to resell	0	0
Money Market Funds, at Carrying Value	7,652	6,967
Derivative Assets	0	0
Servicing Assets	0	0
Derivative liabilities	0	0
Total	7,652	6,967
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	1,435,632	1,568,745
Securities purchased under agreements to resell	0	60,000
Money Market Funds, at Carrying Value	0	0
Derivative Assets	3,306	4,072
Servicing Assets	0	0
Derivative liabilities	(13,830)	(14,937)
Total	1,425,108	1,617,880
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available for sale securities	20,053	19,680
Securities purchased under agreements to resell	0	0
Money Market Funds, at Carrying Value	0	0
Derivative Assets	12,555	16,430
Servicing Assets	13,970	13,801
Derivative liabilities	(12,120)	(15,736)
Total	34,458	34,175
Fair Value, Measurements, Nonrecurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired Commercial Loan	27,975	28,353
Foreclosed real estate	96,884	90,024
Total	124,859	118,377
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired Commercial Loan	0	0
Foreclosed real estate	0	0
Total	0	0
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired Commercial Loan	0	0
Foreclosed real estate	0	0
Total	0	0
Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impaired Commercial Loan	27,975	28,353
Foreclosed real estate	96,884	90,024
Total	$ 124,859	$ 118,377

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FDIC Loss Share Asset and True-up Payment Obligation (Narrative) (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2014
FDIC-Assisted Acquisition and FDIC Shared-Loss Indemnification Asset [Abstract]
Percent Of Losses Fdic Absorbs	80.00%
Percent Of Losses Recoveries Fdic Shares	80.00%
Acquisition Date	Apr. 30, 2010
True-Up Payment Description	The Bank agreed to make a true-up payment, also known as clawback liability or clawback provision, to the FDIC on the date that is 45 days following the last day (such day, the “True-Up Measurement Date”) of the final shared-loss month, or upon the final disposition of all covered assets under the shared-loss agreements in the event losses thereunder fail to reach expected levels. Under the shared-loss agreements, the Bank will pay to the FDIC 50% of the excess, if any, of: (i) 20% of the Intrinsic Loss Estimate of $906.0 million (or $181.2 million) (as determined by the FDIC) less (ii) the sum of: (A) 25% of the asset discount (per bid) (or $227.5 million); plus (B) 25% of the cumulative shared-loss payments (defined as the aggregate of all of the payments made or payable to the Bank minus the aggregate of all of the payments made or payable to the FDIC); plus (C) the sum of the period servicing amounts for every consecutive twelve-month period prior to and ending on the True-Up Measurement Date in respect of each of the shared-loss agreements during which the shared-loss provisions of the applicable shared-loss agreement is in effect (defined as the product of the simple average of the principal amount of shared-loss loans and shared-loss assets at the beginning and end of such period times 1%)
Additional amortization of the FDIC indemnification asset	$ 3.5

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Restricted Cash (Tables)

3 Months Ended

Mar. 31, 2014

Restricted Cash And Investments Abstract

Restricted Cash Components and Its Secured Investments

The following table includes the composition of the restricted cash

	March 31,		December 31,
	2014		2013
	(In thousands)
Deposits pledged as collateral to other financial institutions to secure:
Securities sold under agreements to repurchase	$	-	$	67,029
Derivatives		2,980		2,980
Obligations under agreement of loans sold with recourse		12,190		12,190
	$	15,170	$	82,199

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Derivative Activities (Interest rate swap not designated as hedging instruments and their term) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2014
Derivatives Offered to Clients [Member]
Derivative [Line Items]
Amount	$ 16,594
Derivatives Offered to Clients [Member] | Rate 5.13% [Member]
Derivative [Line Items]
Amount	4,094
Fixed rate	5.13%
Settlement Date	Jul. 03, 2006
Maturity Date	Jul. 03, 2016
Derivatives Offered to Clients [Member] | Rate 5.51% [Member]
Derivative [Line Items]
Amount	12,500
Fixed rate	5.505%
Settlement Date	Apr. 11, 2009
Maturity Date	Apr. 11, 2019
Mirror Image Derivatives [Member]
Derivative [Line Items]
Amount	16,594
Mirror Image Derivatives [Member] | Rate 5.13% [Member]
Derivative [Line Items]
Amount	4,094
Fixed rate	5.13%
Settlement Date	Jul. 03, 2006
Maturity Date	Jul. 03, 2016
Mirror Image Derivatives [Member] | Rate 5.51% [Member]
Derivative [Line Items]
Amount	$ 12,500
Fixed rate	5.505%
Settlement Date	Apr. 11, 2009
Maturity Date	Apr. 11, 2019

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Stockholders' Equity and Earnings per Common Share (Tables)

3 Months Ended

Mar. 31, 2014

Stockholders' Equity [Abstract]

Schedule of Compliance with Regulatory Capital Requirements under Banking Regulations [Table Text Block]

The Company's and the Bank's actual capital amounts and ratios as of March 31, 2014 and December 31, 2013 are as follows:

				Minimum Capital			Minimum to be Well
	Actual			Requirement			Capitalized
	Amount		Ratio	Amount		Ratio		Amount	Ratio
	(Dollars in thousands)
Company Ratios
As of March 31, 2014
Total capital to risk-weighted assets	$	836,168	16.56%	$	404,054	8.00%	$	505,067	10.00%
Tier 1 capital to risk-weighted assets	$	745,619	14.76%	$	202,027	4.00%	$	303,040	6.00%
Tier 1 capital to average total assets	$	745,619	9.51%	$	313,594	4.00%	$	391,993	5.00%
As of December 31, 2013
Total capital to risk-weighted assets	$	827,460	16.16%	$	409,514	8.00%	$	511,893	10.00%
Tier 1 capital to risk-weighted assets	$	736,930	14.35%	$	204,757	4.00%	$	307,136	6.00%
Tier 1 capital to average total assets	$	736,930	9.11%	$	324,910	4.00%	$	406,138	5.00%

				Minimum Capital			Minimum to be Well
	Actual			Requirement			Capitalized
	Amount		Ratio	Amount		Ratio	Amount		Ratio
	(Dollars in thousands)
Bank Ratios
As of March 31, 2014
Total capital to risk-weighted assets	$	805,900	16.02%	$	402,495	8.00%	$	503,119	10.00%
Tier 1 capital to risk-weighted assets	$	715,591	14.22%	$	201,248	4.00%	$	301,871	6.00%
Tier 1 capital to average total assets	$	715,591	9.18%	$	311,659	4.00%	$	389,574	5.00%
As of December 31, 2013
Total capital to risk-weighted assets	$	779,413	15.30%	$	407,637	8.00%	$	509,547	10.00%
Tier 1 capital to risk-weighted assets	$	688,350	13.51%	$	203,819	4.00%	$	305,728	6.00%
Tier 1 capital to average total assets	$	688,350	8.54%	$	322,395	4.00%	$	402,993	5.00%

Schedule of Treasury Stock by Class [Table Text Block]

The following table presents the shares repurchased for each month in the quarter ended March 31, 2014, excluding the month ended March 31, 2014, during which no shares were purchased as part of the stock repurchase program:

	Total number of				Dollar amount of
	shares purchased as		Average		shares repurchased
		part of stock	price paid		(excluding
	repurchase programs		per share		commissions paid)
						(In thousands)
Period
January 2014		57,700	$	14.73	$	850
February 2014		649,700	$	14.66	$	9,522
Quarter ended March 31, 2014		707,400		14.66		10,372

The activity in connection with common shares held in treasury by the Company for quarters ended March 31, 2014 and 2013 is set forth below

	Quarter Ended March 31,
	2014			2013
		Dollar			Dollar
	Shares	Amount		Shares	Amount
	(In thousands, except shares data)
Beginning of year	7,030,101	$	80,642	7,090,597	$	81,275
Common shares used upon lapse of restricted stock units	(27,752)		(292)	(33,600)		(351)
Common shares repurchased as part of the stock repurchase program	707,400		10,393	-		-
Common shares used to match defined contribution plan, net	-		-	(7,318)		(77)
End of year	7,709,749	$	90,743	7,049,679	$	80,847

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

The calculation of earnings per common share for the quartersended March 31, 2014and 2013 is as follows:

	Quarter Ended March 31,
	2014		2013
	(In thousands, except per share data)
Net income	$	23,747	$	21,192
Less: Dividends on preferred stock
Non-Convertible Preferred Stock (Series A, B, and D)		(1,628)		(1,628)
Convertible preferred stock (Series C)		(1,837)		(1,837)
Income available to common shareholders	$	20,282	$	17,727
Effect of assumed conversion of the Convertible Preferred Stock		1,837		1,837
Income available to common shareholders assuming conversion	$	22,119	$	19,564
Weighted average common shares and share equivalents:
Average common shares outstanding		45,329		45,595
Effect of dilutive securities:
Average potential common shares-options		131		159
Average potential common shares-assuming conversion of ' ' convertible preferred stock		7,138		7,138
Total weighted average common shares outstanding ' 'and equivalents		52,598		52,892
Earnings per common share - basic	$	0.45	$	0.39
Earnings per common share - diluted	$	0.42	$	0.37

Schedule of Accumulated Other Comprehensive Income (Loss)

	March 31,		December 31,
	2014		2013
	(In thousands)
Unrealized gain on securities available-for-sale which are not other-than-temporarily impaired	$	18,464	$	13,267
Income tax effect of unrealized gain on securities available-for-sale		(2,429)		(1,834)
Net unrealized gain on securities available-for-sale which are not other-than-temporarily impaired		16,035		11,433
Unrealized loss on cash flow hedges		(10,529)		(10,907)
Income tax effect of unrealized loss on cash flow hedges		2,516		2,665
Net unrealized loss on cash flow hedges		(8,013)		(8,242)
Accumulated other comprehensive income, net of taxes	$	8,022	$	3,191

The following table presents changes in accumulated other comprehensive income by component, net of taxes, for the quartersendedMarch 31, 2014 and 2013:

	Quarter Ended March 31,
	2014						2013
	Net unrealized		Net unrealized		Accumulated		Net unrealized		Net unrealized		Accumulated
	gains on		loss on		other		gains on		loss on		other
	securities		cash flow		comprehensive		securities		cash flow		comprehensive
	available-for-sale		hedges		income		available-for-sale		hedges		income
	(In thousands)						(In thousands)
Beginning balance	$	11,433	$	(8,242)	$	3,191	$	68,245	$	(12,365)	$	55,880
Other comprehensive income before reclassifications		4,465		(1,392)		3,073		(9,899)		(313)		(10,212)
Amounts reclassified out of accumulated other comprehensive income		137		1,621		1,758		47		1,336		1,383
Other comprehensive income (loss)		4,602		229		4,831		(9,852)		1,023		(8,829)
Ending balance	$	16,035	$	(8,013)	$	8,022	$	58,393	$	(11,342)	$	47,051

Reclassification out of Accumulated Other Comprehensive Income [Table text block]

					Affected Line Item in
	Quarter ended March 31,				Consolidated Statement
	2014		2013		of Operations
	(In thousands)
Cash flow hedges:
Interest-rate contracts	$	1,621	$	1,336	Net interest expense
Available-for-sale securities:
Residual tax effect from OIB's change in applicable tax rate		137		47	Income tax expense
	$	1,758	$	1,383

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Income Taxes

3 Months Ended

Mar. 31, 2014

Income Taxes [Abstract]

INCOME TAXES

NOTE 13— INCOME TAXES

On June 30, 2013 the Governor signed Act No. 40-2013,known as “Ley de Redistribución y Ajuste de la CargaContributiva” (Act of Redistribution and Adjustment of Tax Burden), as amended. The main purpose of the Act is to increase government collections in order to alleviate the structural deficit.The most relevant provisions of the Act, as applicable to the Company, and effective for taxable years beginning after December 31,2012 are as follows: (1) the maximum Corporate Income Tax rate was increased from 30% to 39%; (2) the deduction allowed for determining the income subject to surtax was reduced from $750,000 to $25,000 (which must be allocated among the members of a controlled group of corporations); (3)the allowable Net Operating Loss (“NOL”) deduction was reduced to (i) 90% of the corporation's net income subject to regular tax for purposes of computing the regular income tax, and (ii) 80% of the alternative minimum taxable income for purposes of computing the alternative minimum tax (“AMT”); (4) the NOL carryover period was extended from 10 to 12 years for NOLs incurred in taxable years beginning after December 31, 2004 and before January 1, 2013, and from 7 to 10 years for losses incurred in taxable years beginningafter December 31, 2012; (5) a new special tax based on gross income (the “Special Tax”) was added to the Puerto Rico Internal Revenue Code of 2011, as further described below; and (6) a special tax of 1% was imposed on insurance premiumsearned after June 30, 2013.

In the case of non-financial institutions, the Special Tax is paid as part of the AMT and thus is accounted for under the provisions of ASC 740. The applicable Special Tax rate for non-financial institutions increases gradually from 0.2% for gross income equal to or in excess of $1.0 million up to 0.85% for gross income in excess of $1.5 billion. In the case of a controlled group of corporations, the tax rate for all members of the group is determined by the aggregate gross income of all members in the group. In the case of financial institutions, the Special Tax is not part of the AMT calculation thus is accounted for as other tax not subject to the provisions of ASC 740 since the same is based on gross income. The applicable Special Tax rate for financial institutions is 1% ofits gross income ofa taxableyear, of which fifty percent (50%) may be claimed as a credit against the financial institution's applicable income tax of that year.

At March 31, 2014 and December 31, 2013, the Company's net deferred tax asset amounted to $127.7 million and $137.6 million, respectively. In assessing the realizability of the deferred tax asset, management considers whether it is more likely than not that some portion or the entire deferred tax asset will not be realized. The ultimate realization of the deferred tax asset is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible.  Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment.  Based upon the level of historical taxable income and projections for future taxable income over the periods in which the deferred tax asset are deductible, management believes it is more likely than not that the Company will realize the entire deferred tax asset, net of the existing valuation allowances recorded at March 31, 2014 and December 31, 2013. The amount of the deferred tax asset considered realizable, however, could be reduced in the near term if estimates of future taxable income during the carryforward period are reduced.

At March 31, 2014 and December 31, 2013, Oriental International Bank Inc. (“OIB”), the Bank's international banking entity subsidiary, had $219 thousand and $356 thousand, respectively, in income tax effect of unrecognized gain on available-for-sale securities included in other comprehensive income. Following the change in OIB's applicable tax rate from 5% to 0% as a result of a Puerto Rico law adopted in 2011, this remaining tax balance will flow through income as these securities are repaid or sold in future periods. During the quarters ended March 31, 2014 and 2013, $137 thousand and $47 thousand, respectively, related to this residual tax effect from OIB was reclassified from accumulated other comprehensive income into income tax provision.

The Company classifies unrecognized tax benefits in income taxes payable. These gross unrecognized tax benefits would affect the effective tax rate if realized. The balance of unrecognized tax benefits at March 31, 2014 was $4.0 million (December 31, 2013 - $4.0 million). The Company had accrued $1.6 million at March 31, 2014 (December 31, 2013 - $1.2million) for the payment of interest and penalties relating to unrecognized tax benefits.

Income tax expense was $11.8 million for the quarter ended March 31, 2014, compared to $7.1 million for the same periodin 2013. The increase in enacted tax rate from 30% to 39% from the second quarter 2013 amendment to the Puerto Rico tax Code resulted in the increased quarterly income tax expense for this quarter as compared to the same quarter of 2013.

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Guarantees (Narrative) (Details) (USD $)	3 Months Ended			3 Months Ended		3 Months Ended	12 Months Ended
	Mar. 31, 2014	Mar. 31, 2013	Dec. 31, 2013	Mar. 31, 2014 Loan with recourse [Member]	Dec. 31, 2013 Loan with recourse [Member]	Mar. 31, 2014 Loan serviced under representation warranties [Member]	Dec. 31, 2013 Loan serviced under representation warranties [Member]	Mar. 31, 2014 Financial Guarantee Member
Guarantee Obligations [Line Items]
Qualitative And Quantitative Information Assets Or Liabilities For Transferors Continuing Involvement In Securitization Or Asset backed Financing Arrangement Principal Amounts Outstanding				$ 118,200,000	$ 122,300,000
Repurchased Loan				1,600,000		2,800,000	12,500,000
Valuation Allowances And Reserves Balance					2,000,000			1,500,000
Gain (Loss) on repurchase loan subject to credit recourse	50,000	25,000
Gain (Loss) On Repurchase Loan Not Subject To Credit Recourse	434,000	2,000
Funds Advanced To Investors Under Servicing Agreements	323,000		243,000
Two Years Or Less Recourse Obligation Termination Amount	$ 86,500,000
Percentage of Future Extinguished Recourse Obligation Terminated in Two Years Or Less	73.00%