UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
____________________________
FORM 8-K
_________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 25, 2017
OFG Bancorp
(Exact Name of Registrant as Specified in its Charter)
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Commonwealth of Puerto Rico |
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001-12647 |
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66-0538893 |
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(State or other Jurisdiction of Incorporation) |
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(Commission File No.) |
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(I.R.S. Employer |
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Oriental Center, 15th Floor |
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254 Muñoz Rivera Avenue |
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San Juan, Puerto Rico |
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00918 |
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(Address of Principal Executive Offices) |
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(Zip Code) |
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Registrant’s telephone number, including area code: (787) 771-6800
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
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☐ |
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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☐ |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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☐ |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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☐ |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02. Results of Operations and Financial Condition.
On October 25, 2017, OFG Bancorp (the “Company”) announced the results for the quarter ended September 30, 2017. A copy of the Company’s press release is attached as an exhibit to this report.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
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Exhibit No. |
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Description of Document |
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99 |
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Press release by the Company dated October 25, 2017. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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OFG
BANCORP |
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Date: October 25, 2017 |
By: |
/s/ Maritza Arizmendi |
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Maritza Arizmendi |
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Executive Vice President and Chief Financial Officer |
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Exhibit 99
OFG Bancorp Reports 3Q17 Results
SAN JUAN, Puerto Rico, October 25, 2017 – OFG Bancorp (NYSE: OFG) today reported results for the third quarter ended September 30, 2017. Results were significantly impacted by Hurricanes Irma and Maria, which struck the island on September 7 and 20, 2017, respectively.
· Net loss to shareholders was $146 thousand or $0.00 per share. This compares to a profit of $13.6 million, or $0.30 per share fully diluted, in 2Q17 and a profit of $11.7 million, or $0.26 per share fully diluted, in the year ago 3Q16.
· Tangible book value per common share was $15.49 and tangible common equity ratio was 10.98%, with common equity Tier 1 capital ratio of 14.89%, Tier 1 risk-based capital ratio of 19.53%, and total risk-based capital ratio of 20.82%.
· Based on current assessments of information available for the impact of the hurricanes on our credit portfolio, 3Q17 results included an additional $27.0 million in loan loss provision, pre-tax.
· Excluding this provision:
☐ Adjusted net income available to shareholders totaled $18.8 million or $0.40 per share fully diluted – an increase of $0.10 per share or 33.0% from 2Q17 and of $0.14 or 53.8% from the year ago 3Q16.
☐ Adjusted return on average assets was 1.47% and return on average tangible common equity was 10.90% – 38 and 289 basis points higher than 2Q17, respectively.
CEO Comment
José Rafael Fernández, President, Chief Executive Officer, and Vice Chairman of the Board, commented:
“Hurricanes Irma and Maria devastated Puerto Rico and exposed the fragility of our infrastructure and economy. Our deepest sympathy and concern goes out to everyone who has suffered. That includes our own staff and customers. We admire the resilience of all island residents in the face of extremely challenging recovery efforts.
“After the hurricanes, our efforts were focused on assuring the safety and well-being of all members of our team and securing our assets. Our operations continue to be constrained by several factors, in particular challenges with electricity and telecommunications. However, we are committed to doing everything we can to help our customers rebuild their personal lives and businesses. As we say, juntos lograremos más – together we will achieve more!
“Due to our investments in technology, OFG’s digital channels, core banking and electronic funds transfer systems continued to function uninterrupted during and after the hurricanes. Within days after Maria, and after securing a continuing supply of diesel fuel for generators, we started opening branches and ATMs with no limits on teller withdrawals. As a result, we were able to serve our clients regardless of which branches they chose.
“Today, we have 20 branches and 142 ATMs open, in addition to our digital and phone channels. Current branch activity is primarily deposit transactions. While demand for lending and other business is still tame, commercial and auto loan production has begun to pick up a little.
“We are very proud of the truly exceptional efforts of our entire team for going the extra mile to help our customers under very difficult circumstances. After Irma, Oriental was the only bank to offer fee waivers for late payments, recognizing the difficulties people in Puerto Rico might have. Following Maria, we continued to assist our customers by offering automatic payment deferrals and 90-day extensions for most loan categories.
“There is no doubt the economy will be extremely challenging in the short term. But it is widely expected several industry sectors will benefit from the anticipated massive rebuilding effort. Although the magnitude and timing of such benefit is not yet clear, Puerto Rico and OFG need to look forward to a ‘new normal’ and take advantage of the potential opportunities it will present.
“With our strong capital position, OFG is well prepared. We have repeatedly demonstrated our ability to grow during difficult times. We look forward to doing so again.”
The following compares data for the third quarter 2017 to the second quarter 2017, unless otherwise noted.
• Interest Income from
☐ Originated Loans, increased $5.5 million to $58.9 million, reflecting $4.1 million from the pay-off before maturity of a commercial loan previously classified as non-accrual.
☐ Acquired Loans, declined $0.3 million to $23.5 million, reflecting continued pay downs offset by cost recoveries. In 3Q17, the Company recognized $3.1 million in cost recoveries when the Puerto Rico Housing Finance Authority (PRHFA) paid to cancel a loan that had a $10.6 million book balance.
☐ Securities, declined $0.8 million to $7.9 million from lower balances partially offset by higher yields on higher cash balances.
• Interest Expense declined $0.5 million to $9.9 million primarily due to lower borrowings.
• Total Provision for Loan and Lease Losses increased $17.5 million to $44.0 million. 3Q17 reflects regular provision of $17.0 million and the previously mentioned additional hurricane related provision of $27.0 million. Of that $27.0 million, $16.8 million was applied to originated loans and $10.2 million to acquired loans.
• Net Interest Margin expanded to 5.64% from 5.18%. This was due to the above mentioned pay-off of an originated commercial loan classified as non-accrual. It also reflected cost recoveries, lower borrowing balances and costs, and higher cash balances and yield.
• Total Banking and Wealth Management Revenues declined $0.7 million to $17.2 million. During 3Q17, the Company experienced lower banking and wealth management activity levels in September. This was partially offset by increased mortgage banking revenues from servicing asset valuation and prepayment penalty income from the above mentioned commercial loan.
• Other Non-Interest Income totaled $0.7 million compared to $7.0 million. In 2Q17, the Company had a net gain of $6.8 million on the sale of MBS.
• Total Non-Interest Expenses declined $2.3 million to $50.5 million. 2Q17 included costs associated with consolidating office space and lower credit related expenses.
• Income Tax decreased $3.4 million to $560 thousand. 3Q17 reflected lower net income before taxes at the 2017 estimated tax rate of 29.77%. In addition, 3Q17 benefitted from the $0.9 million resolution of a contingent tax position. 2Q17 included a $2.1 million beneficial catch-up adjustment to estimated income tax.
The following compares data at September 30, 2017 to June 30, 2017, unless otherwise noted.
• Total Loans Net declined $127.3 million to $3.96 billion. The decline reflecting the previously announced sale of a $38.0 million municipal loan, continued pay downs of acquired loans, and the $27.0 million additional hurricane loan loss provision.
New loan generation fell to $190.8 million due to declines in commercial, mortgage and consumer lending in September. Auto loan production was level with 2Q17 due to strong performance in the first two months of 3Q17.
• Total Investments declined $63.7 million to $1.16 billion, primarily due to the sale of $45.0 million in Treasury securities.
• Total Borrowings declined $208.0 million to $419.3 million, primarily due to the maturities of $160.4 million in short-term repurchase agreement funding and $72.9 million in Federal Home Loan Bank advances.
• Cash and cash equivalents increased $243.4 million to $723.8 million, due to increased deposits and lower transaction outflows toward the end of the quarter from commercial customers.
• Customer Deposits increased $243.7 million to $4.83 billion, reflecting deposits from commercial customers mentioned above.
• Total Stockholders’ Equity declined $1.3 million to $937.6 million, primarily due to decrease in retained earnings.
The following compares data on the originated loan portfolio at September 30, 2017 to June 30, 2017, unless otherwise noted.
• Net Charge-Off Rate declined 25 basis points to 1.54%. 2Q17 reflected an increase for commercial loans with the sale of the municipality loan.
• Early Delinquency Rate increased 27 basis points to 3.79% and Total Delinquency Rate increased 53 basis points to 6.84% due to increases in September.
• Non-Performing Loans declined 6 basis points to 3.10%, due to improvements in the mortgage, commercial and consumer loan categories, partially offset by an increase in the auto loan category.
• Allowance for Loan and Lease Losses for the originated portfolio increased $17.9 million to $87.5 million. This was mainly due to the previously mentioned additional provision of $16.8 million related to the hurricanes.
The following compares data at September 30, 2017 to June 30, 2017, unless otherwise noted.
Capital continued to build and remains significantly above regulatory requirements for a well-capitalized institution.
• Tangible Common Equity Ratio at 10.98% decreased 11 basis points from 2Q17 but increased 73 basis points year over year.
• Tangible Book Value per Common Share at $15.49 decreased $0.02 cents from 2Q17, but increased $0.31 or 2.1% year over year.
• Common Equity Tier 1 Capital Ratio (using Basel III methodology) at 14.89% increased 23 basis points from 2Q17 and 155 basis points year over year to the highest level in five quarters.
• Total Risk-Based Capital Ratio at 20.82% increased 40 basis points from 2Q17 and 209 basis points year over year to the highest level in five quarters.
A conference call to discuss OFG’s results for the third quarter 2017, outlook and related matters will be held today, Wednesday, October 25, 2017 at 11:00 AM Eastern Time. The call will be accessible live via a webcast on OFG’s Investor Relations website at www.ofgbancorp.com. A webcast replay will be available shortly thereafter. Access the webcast link in advance to download any necessary software.
OFG’s Financial Supplement, with full financial tables for the quarter ended September 30, 2017, can be found on the Webcasts, Presentations & Other Files page, on OFG’s Investor Relations website at www.ofgbancorp.com.
In addition to our financial information presented in accordance with GAAP, management uses certain “non-GAAP financial measures” within the meaning of the SEC Regulation G, to clarify and enhance understanding of past performance and prospects for the future. See Tables 9-1 and 9-2 in OFG’s above-mentioned Financial Supplement for reconciliation of GAAP to non-GAAP Measures and Calculations.
The information included in this document contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and involve certain risks and uncertainties that may cause actual results to differ materially from those expressed in the forward-looking statements.
Factors that might cause such a difference include, but are not limited to (i) the rate of growth in the economy and employment levels, as well as general business and economic conditions; (ii) changes in interest rates, as well as the magnitude of such changes; (iii) the credit default by the government of Puerto Rico; (iv) amendments to the fiscal plan approved by the Financial Oversight and Management Board of Puerto Rico; (v) determinations in the court-supervised debt-restructuring process under Title III of PROMESA for the Puerto Rico government and all of its agencies, including some of its public corporations; (vi) the impact of property, credit and other losses in Puerto Rico as a result of hurricanes Irma and Maria; (vii) the amount of government, private and philanthropic financial assistance for the reconstruction of Puerto Rico’s critical infrastructure, which suffered catastrophic damages caused by hurricane Maria; (viii) the pace and magnitude of Puerto Rico’s economic recovery; (ix) the potential impact of damages from future hurricanes and natural disasters in Puerto Rico; (x) the fiscal and monetary policies of the federal government and its agencies; (xi) changes in federal bank regulatory and supervisory policies, including required levels of capital; (xii) the relative strength or weakness of the commercial and consumer credit sectors and the real estate market in Puerto Rico; (xiii) the performance of the stock and bond markets; (xiv) competition in the financial services industry; and (xv) possible legislative, tax or regulatory changes.
For a discussion of such factors and certain risks and uncertainties to which OFG is subject, see OFG’s annual report on Form 10-K for the year ended December 31, 2016, as well as its other filings with the U.S. Securities and
Exchange Commission. Other than to the extent required by applicable law, including the requirements of applicable securities laws, OFG assumes no obligation to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements.
Now in its 53rd year in business, OFG Bancorp is a diversified financial holding company that operates under U.S. and Puerto Rico banking laws and regulations. Its three principal subsidiaries, Oriental Bank, Oriental Financial Services and Oriental Insurance, provide a wide range of retail and commercial banking, lending and wealth management products, services and technology, primarily in Puerto Rico, through 48 financial centers. Investor information can be found at Error! Hyperlink reference not valid.www.ofgbancorp.com.
# # #
Puerto Rico: Idalis Montalvo (idalis.montalvo@orientalbank.com) at (787) 777-2847
US: Steven Anreder (sanreder@ofgbancorp.com) and Gary Fishman (gfishman@ofgbancorp.com) at (212) 532-3232
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OFG Bancorp |
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Financial Supplement |
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The information contained in this Financial Supplement is preliminary and based on data available at the time of the earnings presentation, and investors should refer to our September 30, 2017 Quarterly Report on Form 10-Q once it is filed with the Securities and Exchange Commission. |
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Table of Contents |
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Pages |
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OFG Bancorp (Consolidated Financial Information) |
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Table 1: |
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Financial and Statistical Summary - Consolidated |
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2 |
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Table 2: |
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Consolidated Statements of Operations |
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3 |
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Table 3: |
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Consolidated Statements of Financial Condition |
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4 |
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Table 4: |
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Information on Loan Portfolio and Production |
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5 |
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Table 5: |
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Average Balances, Net Interest Income and Net Interest Margin |
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6-7 |
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Table 6: |
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Loan Information and Performance Statistics (Excluding Acquired Loans) |
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8-9 |
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Table 7: |
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Allowance for Loan and Lease Losses |
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10 |
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Table 8: |
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Accretable Yield on Loans Accounted for Under ASC 310-30 (Loans Acquired |
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with Deteriorated Credit Quality, Including those by Analogy) |
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11 |
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Table 9: |
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Reconciliation of GAAP to Non-GAAP Measures and Calculation of Regulatory |
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Capital |
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12-13 |
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Table 10: |
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Notes to Financial Summary, Selected Metrics, Loans, and Consolidated |
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Financial Statements (Tables 1-9) |
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14 |
OFG Bancorp (NYSE: OFG) |
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Table 1: Financial and Statistical Summary - Consolidated |
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2017 |
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2017 |
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2017 |
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2016 |
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2016 |
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2017 |
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2016 |
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(Dollars in thousands, except per share data) (unaudited) |
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Q3 |
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Q2 |
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Q1 |
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Q4 |
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Q3 |
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YTD |
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YTD |
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Earnings |
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Net interest income |
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$ |
80,478 |
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$ |
75,563 |
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$ |
74,618 |
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$ |
74,213 |
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$ |
76,927 |
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$ |
230,659 |
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$ |
225,214 |
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Non-interest income, net (core) |
(2) |
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17,213 |
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17,933 |
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17,428 |
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20,415 |
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18,277 |
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52,574 |
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53,686 |
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Non-interest expense |
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50,469 |
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52,816 |
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51,684 |
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52,382 |
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54,927 |
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154,969 |
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163,608 |
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Pre-provision net revenues |
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47,921 |
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47,633 |
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42,008 |
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39,777 |
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42,215 |
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137,562 |
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110,479 |
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Provision for loan and lease losses |
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44,042 |
(a) |
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26,536 |
(b) |
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17,654 |
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13,373 |
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23,469 |
(d) |
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88,232 |
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51,703 |
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Net income before income taxes |
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3,879 |
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21,097 |
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24,354 |
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26,404 |
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18,746 |
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49,330 |
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58,776 |
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Income tax expense |
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560 |
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3,993 |
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9,204 |
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10,848 |
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3,627 |
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13,757 |
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15,146 |
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Net income |
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$ |
3,319 |
(a) |
$ |
17,104 |
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$ |
15,150 |
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$ |
15,556 |
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$ |
15,119 |
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$ |
35,573 |
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$ |
43,630 |
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Common Share Statistics |
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Earnings per common share - basic |
(3) |
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$ |
- |
(a) |
$ |
0.30 |
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$ |
0.27 |
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$ |
0.28 |
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$ |
0.27 |
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$ |
0.57 |
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$ |
0.76 |
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Earnings per common share - diluted |
(4) |
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$ |
- |
(a) |
$ |
0.30 |
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$ |
0.26 |
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$ |
0.27 |
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$ |
0.26 |
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$ |
0.56 |
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$ |
0.76 |
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Average common shares outstanding |
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43,947 |
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43,947 |
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43,915 |
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43,914 |
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43,926 |
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43,937 |
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43,913 |
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Average common shares outstanding and equivalents |
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51,102 |
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51,100 |
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51,131 |
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51,098 |
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51,111 |
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51,095 |
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51,091 |
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Cash dividends per common share |
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$ |
0.06 |
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$ |
0.06 |
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$ |
0.06 |
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$ |
0.06 |
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$ |
0.06 |
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$ |
0.18 |
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$ |
0.18 |
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Book value per common share (period end) |
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$ |
17.56 |
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$ |
17.59 |
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$ |
17.42 |
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$ |
17.18 |
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$ |
17.29 |
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$ |
17.56 |
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$ |
17.29 |
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Tangible book value per common share (period end) |
(5) |
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$ |
15.49 |
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$ |
15.51 |
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$ |
15.33 |
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$ |
15.08 |
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$ |
15.18 |
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$ |
15.49 |
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$ |
15.18 |
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Balance Sheet (Average Balances) |
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Loans |
(6) |
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$ |
4,062,269 |
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$ |
4,129,550 |
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$ |
4,141,628 |
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$ |
4,195,966 |
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$ |
4,398,032 |
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$ |
4,170,048 |
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$ |
4,441,665 |
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Interest-earning assets |
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5,659,179 |
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5,848,525 |
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5,932,924 |
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5,972,163 |
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6,169,251 |
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5,875,859 |
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6,290,862 |
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Total assets |
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6,046,139 |
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6,278,464 |
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6,374,177 |
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6,455,023 |
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6,653,446 |
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6,231,725 |
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6,806,718 |
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Interest-bearing deposits |
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3,774,378 |
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3,844,490 |
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3,850,506 |
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3,875,536 |
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3,920,565 |
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3,822,846 |
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3,935,216 |
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Borrowings |
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462,035 |
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614,332 |
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715,951 |
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750,446 |
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917,212 |
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596,413 |
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1,067,662 |
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Stockholders' equity |
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947,404 |
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938,707 |
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926,011 |
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919,697 |
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919,171 |
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937,456 |
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909,175 |
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Common stockholders' equity |
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781,534 |
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772,837 |
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760,141 |
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753,827 |
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753,301 |
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771,586 |
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743,305 |
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Performance Metrics |
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Net interest margin |
(7) |
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5.64% |
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5.18% |
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5.10% |
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4.94% |
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4.95% |
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5.25% |
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4.77% |
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Return on average assets |
(8) |
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0.22% |
(a) |
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1.09% |
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0.95% |
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0.96% |
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0.91% |
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0.76% |
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0.85% |
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Return on average tangible common stockholders' equity |
(9) |
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-0.08% |
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8.01% |
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7.00% |
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7.31% |
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7.06% |
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4.94% |
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6.82% |
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Efficiency ratio |
(10) |
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51.66% |
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56.49% |
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56.15% |
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55.36% |
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57.69% |
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54.71% |
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58.66% |
|
|
Full-time equivalent employees, period end |
|
|
|
1,464 |
|
|
1,472 |
|
|
1,446 |
|
|
1,437 |
|
|
1,439 |
|
|
1,464 |
|
|
1,439 |
|
|
Credit Quality Metrics |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Excluding acquired loans: |
(1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for loan and lease losses |
|
|
$ |
87,543 |
(a) |
$ |
69,666 |
(b) |
$ |
60,483 |
|
$ |
59,300 |
|
$ |
62,168 |
(c) |
$ |
87,543 |
|
$ |
62,168 |
|
|
Allowance as a % of loans held for investment |
|
|
|
2.83% |
(a) |
|
2.25% |
|
|
1.98% |
|
|
1.95% |
|
|
2.06% |
|
|
2.83% |
|
|
2.06% |
|
|
Net charge-offs |
|
|
$ |
11,815 |
|
$ |
13,635 |
(b)(c) |
$ |
10,552 |
|
$ |
13,506 |
|
$ |
65,352 |
(c) |
$ |
36,002 |
|
$ |
84,878 |
|
|
Net charge-off rate |
(11) |
|
|
1.54% |
|
|
1.79% |
(b)(c) |
|
1.40% |
|
|
1.80% |
|
|
8.27% |
(c) |
|
1.58% |
|
|
3.62% |
|
|
Early delinquency rate (30 - 89 days past due) |
|
|
|
3.79% |
|
|
3.52% |
|
|
3.42% |
|
|
3.31% |
|
|
3.70% |
|
|
3.79% |
|
|
3.70% |
|
|
Total delinquency rate (30 days and over) |
|
|
|
6.84% |
|
|
6.31% |
|
|
6.34% |
|
|
6.49% |
|
|
6.92% |
|
|
6.84% |
|
|
6.92% |
|
|
Capital Ratios (Non-GAAP) |
(12) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Leverage ratio |
|
|
|
14.07% |
|
|
13.69% |
|
|
13.20% |
|
|
12.99% |
|
|
12.35% |
|
|
14.07% |
|
|
12.35% |
|
|
Common equity Tier 1 capital ratio |
|
|
|
14.89% |
|
|
14.66% |
|
|
14.30% |
|
|
14.05% |
|
|
13.34% |
|
|
14.89% |
|
|
13.34% |
|
|
Tier 1 risk-based capital ratio |
|
|
|
19.53% |
|
|
19.14% |
|
|
18.77% |
|
|
18.35% |
|
|
17.46% |
|
|
19.53% |
|
|
17.46% |
|
|
Total risk-based capital ratio |
|
|
|
20.82% |
|
|
20.42% |
|
|
20.05% |
|
|
19.62% |
|
|
18.73% |
|
|
20.82% |
|
|
18.73% |
|
|
Tangible common equity ("TCE") ratio |
|
|
|
10.98% |
|
|
11.09% |
|
|
10.66% |
|
|
10.33% |
|
|
10.25% |
|
|
10.98% |
|
|
10.25% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) During the Q3 2017, earnings were impacted by Hurricanes Irma and Maria, which struck the island on September 7, 2017 and September 20, 2017, respectively. Based on our assessment of the facts we have increased our provision for the allowance of loan losses in the 3Q 2017 $27 million, related to these hurricanes.
|
||||||||||||||||||||||||
(b) On June 30, 2017, the Company entered into an agreement for the sale of a municipality loan for $28.8 million. At June 30, 2017, this loan, which included a principal payment of $4.8 million received in July 1, 2017, was reported as other loans held for sale, at fair value. As a result of this transaction, the Company recognized a $4.3 million charge-off during the second quarter. Proceeds were received on July 5, 2017. An allowance of $5.9 million was created during the second quarter for the remaining portfolio of municipal loans. |
||||||||||||||||||||||||
(c) During Q2 2017 , the Company had additional recoveries in auto and consumer loans of $1.1 million and $612 thousand, respectively. |
|
|||||||||||||||||||||||
(d) During Q3 2016, the Company entered into an agreement to sell its outstanding participation in the PREPA line of credit for $124 million, slightly lower than the adjusted book balance, net of reserves. At September 30, 2016, this line of credit was reported as other loans held for sale, at fair value. Proceeds were received on October 7, 2016. As a result of this transaction, the Company recognized a $56.2 million charge-off and a $2.9 million provision for loan and lease losses during the quarter ended September 30, 2016. |
|
|||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2 |
|
OFG Bancorp (NYSE: OFG) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 2: Consolidated Statements of Operations |
|
|
|
|
|
|
|
|
|||||||||||||||
|
|
Quarter Ended |
|
Nine-Months Ended |
|
||||||||||||||||||
|
|
|
September 30, |
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
|
September 30, |
|
September 30, |
|
|||||||
(Dollars in thousands, except per share data) (unaudited) |
|
|
2017 |
|
2017 |
|
2017 |
|
2016 |
|
2016 |
|
2017 |
|
2016 |
|
|||||||
Interest income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans |
(1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-acquired loans |
|
|
$ |
58,939 |
(c) |
$ |
53,449 |
|
$ |
51,955 |
|
$ |
51,581 |
|
$ |
50,568 |
|
$ |
164,343 |
|
$ |
147,841 |
|
Acquired BBVAPR loans |
|
|
|
19,189 |
(b) |
|
17,752 |
|
|
19,085 |
|
|
20,232 |
|
|
22,723 |
|
|
56,026 |
|
|
71,792 |
|
Acquired Eurobank loans |
|
|
|
4,339 |
|
|
6,037 |
|
|
6,610 |
|
|
6,701 |
|
|
9,313 |
|
|
16,986 |
|
|
23,798 |
|
Total interest income from loans |
|
|
|
82,467 |
|
|
77,238 |
|
|
77,650 |
|
|
78,514 |
|
|
82,604 |
|
|
237,355 |
|
|
243,431 |
|
Investment securities |
|
|
|
7,888 |
|
|
8,702 |
|
|
8,528 |
|
|
8,280 |
|
|
7,980 |
|
|
25,118 |
|
|
26,367 |
|
Total interest income |
|
|
|
90,355 |
|
|
85,940 |
|
|
86,178 |
|
|
86,794 |
|
|
90,584 |
|
|
262,473 |
|
|
269,798 |
|
Interest expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Core deposits |
|
|
|
5,438 |
|
|
5,568 |
|
|
5,468 |
|
|
5,536 |
|
|
5,580 |
|
|
16,474 |
|
|
16,267 |
|
Brokered deposits |
|
|
|
2,163 |
|
|
2,084 |
|
|
1,885 |
|
|
1,895 |
|
|
1,751 |
|
|
6,132 |
|
|
5,555 |
|
Total deposits |
|
|
|
7,601 |
|
|
7,652 |
|
|
7,353 |
|
|
7,431 |
|
|
7,331 |
|
|
22,606 |
|
|
21,822 |
|
Borrowings |
|
|
|
2,276 |
|
|
2,725 |
|
|
4,207 |
(g) |
|
5,150 |
|
|
6,326 |
|
|
9,208 |
|
|
22,762 |
|
Total interest expense |
|
|
|
9,877 |
|
|
10,377 |
|
|
11,560 |
|
|
12,581 |
|
|
13,657 |
|
|
31,814 |
|
|
44,584 |
|
Net interest income |
|
|
|
80,478 |
|
|
75,563 |
|
|
74,618 |
|
|
74,213 |
|
|
76,927 |
|
|
230,659 |
|
|
225,214 |
|
Provision for loan and lease losses, excluding acquired loans |
(1) |
|
|
30,373 |
(a) |
|
22,818 |
(d) |
|
11,735 |
|
|
10,638 |
|
|
14,708 |
(i) |
|
64,926 |
|
|
34,420 |
(d) |
Provision for acquired BBVAPR loan and lease losses |
(1) |
|
|
11,167 |
(a) |
|
3,306 |
|
|
4,299 |
|
|
3,135 |
|
|
7,942 |
|
|
18,772 |
|
|
14,628 |
|
Provision (recapture) for acquired Eurobank loan and lease losses |
(1) |
|
|
2,502 |
(a) |
|
412 |
|
|
1,620 |
|
|
(400) |
|
|
819 |
|
|
4,534 |
|
|
2,655 |
|
Total provision for loan and lease losses, net |
|
|
|
44,042 |
(a) |
|
26,536 |
|
|
17,654 |
|
|
13,373 |
|
|
23,469 |
|
|
88,232 |
|
|
51,703 |
|
Net interest income after provision for loan and lease losses |
|
|
|
36,436 |
|
|
49,027 |
|
|
56,964 |
|
|
60,840 |
|
|
53,458 |
|
|
142,427 |
|
|
173,511 |
|
Non-interest income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Banking service revenues |
|
|
|
9,923 |
|
|
10,458 |
|
|
10,626 |
|
|
10,980 |
|
|
10,330 |
|
|
31,007 |
|
|
30,667 |
|
Wealth management revenues |
|
|
|
6,016 |
|
|
6,516 |
|
|
6,215 |
|
|
7,714 |
|
|
6,526 |
|
|
18,747 |
|
|
19,719 |
|
Mortgage banking activities |
|
|
|
1,274 |
|
|
959 |
|
|
587 |
|
|
1,721 |
|
|
1,421 |
|
|
2,820 |
|
|
3,300 |
|
Total banking and wealth management revenues |
|
|
|
17,213 |
|
|
17,933 |
|
|
17,428 |
|
|
20,415 |
|
|
18,277 |
|
|
52,574 |
|
|
53,686 |
|
FDIC shared-loss benefit (expense), net |
|
|
|
- |
|
|
- |
|
|
1,403 |
(h) |
|
(2,836) |
|
|
(3,296) |
|
|
1,403 |
|
|
(10,745) |
|
Other gains, net |
|
|
|
699 |
(j) |
|
6,953 |
(e) |
|
243 |
|
|
367 |
|
|
5,234 |
(j) |
|
7,895 |
(e) |
|
5,932 |
(j) |
Total non-interest income, net |
|
|
|
17,912 |
|
|
24,886 |
|
|
19,074 |
|
|
17,946 |
|
|
20,215 |
|
|
61,872 |
|
|
48,873 |
|
Non-interest expense: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and employee benefits |
|
|
|
19,882 |
|
|
19,317 |
|
|
20,347 |
|
|
18,898 |
|
|
19,168 |
|
|
59,546 |
|
|
57,864 |
|
Rent and occupancy costs |
|
|
|
8,276 |
|
|
8,537 |
|
|
7,198 |
|
|
7,305 |
|
|
7,353 |
|
|
24,011 |
|
|
22,995 |
|
Net loss on sale of foreclosed real estate and other repossessed assets |
|
|
|
1,395 |
|
|
1,787 |
|
|
1,326 |
|
|
1,219 |
|
|
2,970 |
|
|
4,508 |
|
|
9,063 |
|
General and administrative expenses |
|
|
|
19,202 |
|
|
20,958 |
|
|
20,187 |
|
|
22,870 |
|
|
21,717 |
|
|
60,347 |
|
|
65,509 |
|
Total operating expenses |
|
|
|
48,755 |
|
|
50,599 |
|
|
49,058 |
|
|
50,292 |
|
|
51,208 |
|
|
148,412 |
|
|
155,431 |
|
Credit related expenses |
|
|
|
1,714 |
|
|
2,217 |
|
|
2,626 |
|
|
2,090 |
|
|
3,719 |
|
|
6,557 |
|
|
8,177 |
|
Total non-interest expense |
|
|
|
50,469 |
|
|
52,816 |
|
|
51,684 |
|
|
52,382 |
|
|
54,927 |
|
|
154,969 |
|
|
163,608 |
|
Income before income taxes |
|
|
|
3,879 |
|
|
21,097 |
|
|
24,354 |
|
|
26,404 |
|
|
18,746 |
|
|
49,330 |
|
|
58,776 |
|
Income tax expense |
|
|
|
560 |
(d) |
|
3,993 |
(f) |
|
9,204 |
|
|
10,848 |
|
|
3,627 |
|
|
13,757 |
|
|
15,146 |
|
Net income |
|
|
|
3,319 |
(a) |
|
17,104 |
|
|
15,150 |
|
|
15,556 |
|
|
15,119 |
|
|
35,573 |
|
|
43,630 |
|
Less: dividends on preferred stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Convertible preferred stock |
|
|
|
(1,838) |
|
|
(1,837) |
|
|
(1,838) |
|
|
(1,837) |
|
|
(1,838) |
|
|
(5,513) |
|
|
(5,513) |
|
Other preferred stock |
|
|
|
(1,627) |
|
|
(1,629) |
|
|
(1,627) |
|
|
(1,629) |
|
|
(1,627) |
|
|
(4,883) |
|
|
(4,883) |
|
Net (loss) income available to common shareholders |
|
|
$ |
(146) |
|
$ |
13,638 |
|
$ |
11,685 |
|
$ |
12,090 |
|
$ |
11,654 |
|
$ |
25,177 |
|
$ |
33,234 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) During the Q3 2017, earnings were impacted by Hurricanes Irma and Maria, which struck the island on September 7, 2017 and September 20, 2017, respectively. Based on our assessment of the facts we have increased our provision for the allowance of loan losses in the 3Q 2017 $27 million, related to these hurricanes. |
|
||||||||||||||||||||||
(b) During Q3 2017, the Company recognized $3.1 million in cost recoveries from the Puerto Rico Housing Finance Authority ("PRHFA") loan with an outstanding principal balance of $10.9 million. |
|
||||||||||||||||||||||
(c) During Q3 2017, the Company received $22.4 million from the pay-off before maturity of a loan previously classified as non-accrual. As a result, the Company recorded $4.1 million in interest income and $439 thousand in prepayment penalty income. |
|
||||||||||||||||||||||
(d) On June 30, 2017, the Company entered into an agreement for the sale of a municipality loan for $28.8 million. At June 30, 2017, this loan, which included a principal payment of $4.8 million received in July 1, 2017, was reported as other loans held for sale, at fair value. As a result of this transaction, the Company recognized a $4.3 million charge-off during the second quarter. Proceeds were received on July 5, 2017. An allowance of $5.9 million was created during the second quarter for the remaining portfolio of municipal loans. |
|
||||||||||||||||||||||
(e) During Q2 2017, the Company sold $166.0 million of mortgage-backed securities and recorded a net gain on sale of securities of $6.8 million. Also, it sold $39.2 million Treasury Notes and recorded a net gain of $112 thousand. In addition, the Company unwound repurchase agreements in the amount of $100 million at a cost of $80 thousand. |
|
||||||||||||||||||||||
(f) During Q2 2017, the effective income tax rate decreased as a result of higher proportion of exempt income and income subject to preferential rates mainly due to the gain in sale of investment portfolio. |
|
||||||||||||||||||||||
(g) During Q1 2017, a $232.0 million repurchase agreement at 4.78% was repaid at maturity. |
|
||||||||||||||||||||||
(h) During Q1 2017, the Bank and the FDIC agreed to terminate the single family and commercial shared-loss agreements related to the FDIC assisted acquisition of Eurobank on April 30, 2010, resulting in a benefit of $1.4 million. |
|
||||||||||||||||||||||
(i) During Q3 2016, the Company entered into an agreement to sell its outstanding participation in the PREPA line of credit for $124 million, slightly lower than the adjusted book balance, net of reserves. At September 30, 2016, this line of credit was reported as other loans held for sale, at fair value. Proceeds were received on October 7, 2016. As a result of this transaction, the Company recognized a $56.2 million charge-off and a $2.9 provision for loan and lease losses during the quarter ended September 30, 2016. |
|
||||||||||||||||||||||
(j) During Q3 2016, the Company received $5 million from a 2009 claim of loss related to a private label collateralized obligation. During Q3 2017, the Company received $571 thousand, as final settlement. |
|
||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3 |
|
OFG Bancorp (NYSE: OFG) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Table 3: Consolidated Statements of Financial Condition |
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
September 30, |
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
|
|||||
(Dollars in thousands) (unaudited) |
|
|
2017 |
|
2017 |
|
2017 |
|
2016 |
|
2016 |
|
|||||
Cash and cash equivalents |
|
|
$ |
723,756 |
|
$ |
480,338 |
|
$ |
483,301 |
|
$ |
513,469 |
|
$ |
512,295 |
|
Investments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trading securities |
|
|
|
284 |
|
|
294 |
|
|
314 |
|
|
347 |
|
|
380 |
|
Investment securities available-for-sale, at fair value, with amortized cost of $611,936 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(June 30, 2017 - $649,280; March 31, 2017 - $796,558; December 31, 2016 - $749,867; |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2016 - $623,994) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage-backed securities |
|
|
|
596,222 |
|
|
584,930 |
(c) |
|
741,405 |
|
|
692,552 |
|
|
632,429 |
|
Other investment securities |
|
|
|
17,201 |
(a) |
|
64,397 |
|
|
58,637 |
|
|
58,932 |
|
|
10,254 |
|
Total investment securities available-for-sale |
|
|
|
613,423 |
|
|
649,327 |
|
|
800,042 |
|
|
751,484 |
|
|
642,683 |
|
Mortgage-backed securities held-to-maturity, at amortized cost, with fair value of $525,830 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(June 30, 2017 - $549,595; March 31, 2017 - $570,963; December 31, 2016 - $592,763; |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2016 - $650,023) |
|
|
|
530,178 |
|
|
555,407 |
|
|
577,997 |
|
|
599,884 |
|
|
641,890 |
|
Federal Home Loan Bank (FHLB) stock, at cost |
|
|
|
14,016 |
|
|
16,616 |
|
|
17,161 |
|
|
10,793 |
|
|
12,712 |
|
Other investments |
|
|
|
3 |
|
|
3 |
|
|
3 |
|
|
3 |
|
|
3 |
|
Total investments |
|
|
|
1,157,904 |
|
|
1,221,647 |
|
|
1,395,517 |
|
|
1,362,511 |
|
|
1,297,668 |
|
Loans, net |
|
|
|
3,964,572 |
|
|
4,091,866 |
|
|
4,089,708 |
|
|
4,147,692 |
|
|
4,298,965 |
|
Other assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FDIC shared-loss indemnification asset |
|
|
|
- |
|
|
- |
|
|
- |
(d) |
|
14,411 |
|
|
16,670 |
|
Derivative assets |
|
|
|
809 |
|
|
957 |
|
|
1,123 |
|
|
1,330 |
|
|
1,503 |
|
Prepaid expenses |
|
|
|
13,070 |
|
|
17,117 |
|
|
15,496 |
|
|
17,096 |
|
|
19,514 |
|
Deferred tax asset, net |
|
|
|
126,041 |
|
|
116,199 |
|
|
121,442 |
|
|
124,200 |
|
|
131,061 |
|
Foreclosed real estate and repossessed properties |
|
|
|
51,104 |
|
|
53,448 |
|
|
50,820 |
|
|
50,743 |
|
|
49,188 |
|
Premises and equipment, net |
|
|
|
67,994 |
|
|
69,836 |
|
|
69,786 |
|
|
70,407 |
|
|
71,105 |
|
Goodwill |
|
|
|
86,069 |
|
|
86,069 |
|
|
86,069 |
|
|
86,069 |
|
|
86,069 |
|
Accounts receivable and other assets |
|
|
|
96,898 |
|
|
98,349 |
|
|
101,345 |
|
|
113,896 |
|
|
108,075 |
|
Total assets |
|
|
$ |
6,288,217 |
|
$ |
6,235,826 |
|
$ |
6,414,607 |
|
$ |
6,501,824 |
|
$ |
6,592,113 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Demand deposits |
|
|
$ |
1,925,721 |
|
$ |
1,844,996 |
|
$ |
1,944,921 |
|
$ |
1,939,764 |
|
$ |
2,012,255 |
|
Savings accounts |
|
|
|
1,311,515 |
|
|
1,115,669 |
|
|
1,174,581 |
|
|
1,128,190 |
|
|
1,118,783 |
|
Time deposits |
|
|
|
1,053,568 |
|
|
1,053,110 |
|
|
1,022,447 |
|
|
1,020,138 |
|
|
1,042,572 |
|
Brokered deposits |
|
|
|
535,600 |
|
|
568,911 |
|
|
575,879 |
|
|
576,395 |
|
|
581,161 |
|
Total deposits |
|
|
|
4,826,404 |
|
|
4,582,686 |
|
|
4,717,828 |
|
|
4,664,487 |
|
|
4,754,771 |
|
Borrowings: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities sold under agreements to repurchase |
|
|
|
283,080 |
(b) |
|
453,492 |
|
|
531,179 |
(e) |
|
653,756 |
|
|
658,232 |
|
Advances from FHLB and other borrowings |
|
|
|
100,091 |
|
|
137,717 |
|
|
105,133 |
|
|
105,515 |
|
|
105,984 |
|
Subordinated capital notes |
|
|
|
36,083 |
|
|
36,083 |
|
|
36,083 |
|
|
36,083 |
|
|
36,083 |
|
Total borrowings |
|
|
|
419,254 |
|
|
627,292 |
|
|
672,395 |
|
|
795,354 |
|
|
800,299 |
|
Other liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Derivative liabilities |
|
|
|
1,677 |
|
|
1,881 |
|
|
1,967 |
|
|
2,437 |
|
|
4,306 |
|
Acceptances outstanding |
|
|
|
16,486 |
|
|
22,739 |
|
|
24,288 |
|
|
23,765 |
|
|
18,043 |
|
Accrued expenses and other liabilities |
|
|
|
86,766 |
|
|
62,259 |
|
|
66,700 |
|
|
95,370 |
|
|
89,760 |
|
Total liabilities |
|
|
|
5,350,587 |
|
|
5,296,857 |
|
|
5,483,178 |
|
|
5,581,413 |
|
|
5,667,179 |
|
Stockholders' equity: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock |
|
|
|
176,000 |
|
|
176,000 |
|
|
176,000 |
|
|
176,000 |
|
|
176,000 |
|
Common stock |
|
|
|
52,626 |
|
|
52,626 |
|
|
52,626 |
|
|
52,626 |
|
|
52,626 |
|
Additional paid-in capital |
|
|
|
541,302 |
|
|
541,005 |
|
|
540,808 |
|
|
540,948 |
|
|
540,692 |
|
Legal surplus |
|
|
|
79,795 |
|
|
79,460 |
|
|
77,772 |
|
|
76,293 |
|
|
74,788 |
|
Retained earnings |
|
|
|
191,567 |
|
|
194,687 |
|
|
185,377 |
|
|
177,808 |
|
|
169,858 |
|
Treasury stock, at cost |
|
|
|
(104,502) |
|
|
(104,502) |
|
|
(104,502) |
|
|
(104,860) |
|
|
(104,874) |
|
Accumulated other comprehensive income, net |
|
|
|
842 |
|
|
(307) |
|
|
3,348 |
|
|
1,596 |
|
|
15,844 |
|
Total stockholders' equity |
|
|
|
937,630 |
|
|
938,969 |
|
|
931,429 |
|
|
920,411 |
|
|
924,934 |
|
Total liabilities and stockholders' equity |
|
|
$ |
6,288,217 |
|
$ |
6,235,826 |
|
$ |
6,414,607 |
|
$ |
6,501,824 |
|
$ |
6,592,113 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) During Q3 2017, the Company sold $45.0 million US Treasury securities available for sale and recorded a gain of $4 thousand. |
|
||||||||||||||||
(b) During Q3 2017, $160.4 million in short-term repurchase agreements matured and were not renewed. |
|
||||||||||||||||
(c) During Q2 2017, the Company sold $166.0 million of mortgage-backed securities and recorded a net gain on sale of securities of $6.8 million. Also, it sold $39.2 million Treasury Notes and recorded a net gain of $112 thousand. In addition, the Company unwound repurchase agreements in the amount of $100 million at a cost of $80 thousand. |
|
||||||||||||||||
(d) During Q1 2017, the Bank and the FDIC agreed to terminate the single family and commercial shared-loss agreements related to the FDIC assisted acquisition of Eurobank on April 30, 2010, resulting in a benefit of $1.4 million. |
|
||||||||||||||||
(e) During Q1 2017, a $232.0 million repurchase agreement at 4.78% was repaid at maturity. |
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4 |
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OFG Bancorp (NYSE: OFG) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 4: Information on Loan Portfolio and Production |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, |
|
June 30, |
|
March 31, |
|
December 31, |
|
September 30, |
|
|||||
(Dollars in thousands) (unaudited) |
|
|
2017 |
|
2017 |
|
2017 |
|
2016 |
|
2016 |
|
|||||
Non-acquired loans held for investment: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage |
|
|
$ |
694,476 |
|
$ |
699,290 |
|
$ |
709,863 |
|
$ |
721,494 |
|
$ |
735,367 |
|
Commercial |
|
|
|
1,245,711 |
|
|
1,270,844 |
(b) |
|
1,253,712 |
|
|
1,277,866 |
|
|
1,267,177 |
(c) |
Consumer |
|
|
|
316,357 |
|
|
314,267 |
|
|
300,412 |
|
|
290,515 |
|
|
278,666 |
|
Auto |
|
|
|
831,437 |
|
|
807,204 |
|
|
786,606 |
|
|
756,395 |
|
|
730,589 |
|
|
|
|
|
3,087,981 |
|
|
3,091,605 |
|
|
3,050,593 |
|
|
3,046,270 |
|
|
3,011,799 |
|
Less: Allowance for loan and lease losses |
|
|
|
(88,224) |
(a) |
|
(69,666) |
(b) |
|
(60,483) |
|
|
(59,301) |
|
|
(62,168) |
(c) |
|
|
|
|
2,999,757 |
|
|
3,021,939 |
|
|
2,990,110 |
|
|
2,986,969 |
|
|
2,949,631 |
|
Deferred loan costs, net |
|
|
|
6,592 |
|
|
6,574 |
|
|
6,464 |
|
|
5,766 |
|
|
5,421 |
|
Total non-acquired loans held for investment, net |
|
|
|
3,006,349 |
|
|
3,028,513 |
|
|
2,996,574 |
|
|
2,992,735 |
|
|
2,955,052 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquired loans: |
(1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BBVAPR |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounted for under ASC 310-20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial |
|
|
|
4,612 |
|
|
5,350 |
|
|
5,436 |
|
|
5,562 |
|
|
5,755 |
|
Consumer |
|
|
|
29,464 |
|
|
30,233 |
|
|
31,001 |
|
|
32,862 |
|
|
34,215 |
|
Auto |
|
|
|
26,562 |
|
|
33,661 |
|
|
42,523 |
|
|
53,026 |
|
|
64,393 |
|
|
|
|
|
60,638 |
|
|
69,244 |
|
|
78,960 |
|
|
91,450 |
|
|
104,363 |
|
Less: Allowance for loan and lease losses |
|
|
|
(3,363) |
(a) |
|
(3,348) |
|
|
(3,615) |
|
|
(4,299) |
|
|
(4,213) |
|
|
|
|
|
57,275 |
|
|
65,896 |
|
|
75,345 |
|
|
87,151 |
|
|
100,150 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounted for under ASC 310-30 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage |
|
|
|
532,948 |
|
|
544,325 |
|
|
558,112 |
|
|
569,253 |
|
|
579,769 |
|
Commercial |
|
|
|
244,359 |
|
|
266,002 |
|
|
278,665 |
|
|
292,564 |
|
|
301,599 |
|
Consumer |
|
|
|
1,598 |
|
|
2,163 |
|
|
3,201 |
|
|
4,301 |
|
|
5,768 |
|
Auto |
|
|
|
49,258 |
|
|
58,078 |
|
|
71,495 |
|
|
85,676 |
|
|
100,475 |
|
|
|
|
|
828,163 |
|
|
870,568 |
|
|
911,473 |
|
|
951,794 |
|
|
987,611 |
|
Less: Allowance for loan and lease losses |
|
|
|
(39,466) |
(a) |
|
(37,494) |
|
|
(34,930) |
|
|
(31,056) |
|
|
(29,819) |
|
|
|
|
|
788,697 |
|
|
833,074 |
|
|
876,543 |
|
|
920,738 |
|
|
957,792 |
|
Total Acquired BBVAPR loans, net |
|
|
|
845,972 |
|
|
898,970 |
|
|
951,888 |
|
|
1,007,889 |
|
|
1,057,942 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eurobank |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounted for under ASC 310-30 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage |
|
|
|
68,996 |
|
|
70,329 |
|
|
72,966 |
|
|
73,018 |
|
|
75,043 |
|
Commercial |
|
|
|
53,028 |
|
|
66,894 |
|
|
73,181 |
|
|
81,460 |
|
|
82,753 |
|
Consumer |
|
|
|
1,220 |
|
|
1,256 |
|
|
1,268 |
|
|
1,372 |
|
|
1,488 |
|
|
|
|
|
123,244 |
|
|
138,479 |
|
|
147,415 |
|
|
155,850 |
|
|
159,284 |
|
Less: Allowance for loan and lease losses |
|
|
|
(23,107) |
(a) |
|
(21,787) |
|
|
(22,006) |
|
|
(21,281) |
|
|
(22,812) |
|
Total Acquired Eurobank loans, net |
|
|
|
100,137 |
|
|
116,692 |
|
|
125,409 |
|
|
134,569 |
|
|
136,472 |
|
Total acquired loans, net |
|
|
|
946,109 |
|
|
1,015,662 |
|
|
1,077,297 |
|
|
1,142,458 |
|
|
1,194,414 |
|
Total loans held for investment |
|
|
|
3,952,458 |
|
|
4,044,175 |
|
|
4,073,871 |
|
|
4,135,193 |
|
|
4,149,466 |
|
Mortgage loans held for sale |
|
|
|
12,114 |
|
|
14,044 |
|
|
15,837 |
|
|
12,499 |
|
|
26,362 |
|
Other loans held for sale |
|
|
|
- |
|
|
33,647 |
(b) |
|
- |
|
|
- |
|
|
123,137 |
(c) |
Total loans, net |
|
|
$ |
3,964,572 |
|
$ |
4,091,866 |
|
$ |
4,089,708 |
|
$ |
4,147,692 |
|
$ |
4,298,965 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loan Portfolio Summary: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans held for investment: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage |
|
|
$ |
1,296,420 |
|
$ |
1,313,944 |
|
$ |
1,340,941 |
|
$ |
1,363,765 |
|
$ |
1,390,179 |
|
Commercial |
|
|
|
1,547,710 |
|
|
1,609,090 |
(b) |
|
1,610,994 |
|
|
1,657,452 |
|
|
1,657,284 |
(c) |
Consumer |
|
|
|
348,639 |
|
|
347,919 |
|
|
335,882 |
|
|
329,050 |
|
|
320,137 |
|
Auto and leasing |
|
|
|
907,257 |
|
|
898,943 |
|
|
900,624 |
|
|
895,097 |
|
|
895,457 |
|
|
|
|
|
4,100,026 |
|
|
4,169,896 |
|
|
4,188,441 |
|
|
4,245,364 |
|
|
4,263,057 |
|
Less: Allowance for loan and lease losses |
|
|
|
(154,160) |
|
|
(132,295) |
(b) |
|
(121,034) |
|
|
(115,937) |
|
|
(119,012) |
(c) |
|
|
|
|
3,945,866 |
|
|
4,037,601 |
|
|
4,067,407 |
|
|
4,129,427 |
|
|
4,144,045 |
|
Deferred loan costs, net |
|
|
|
6,592 |
|
|
6,574 |
|
|
6,464 |
|
|
5,766 |
|
|
5,421 |
|
Total loans held for investment, net |
|
|
|
3,952,458 |
|
|
4,044,175 |
|
|
4,073,871 |
|
|
4,135,193 |
|
|
4,149,466 |
|
Mortgage loans held for sale |
|
|
|
12,114 |
|
|
14,044 |
|
|
15,837 |
|
|
12,499 |
|
|
26,362 |
|
Other loans held for sale |
|
|
|
- |
|
|
33,647 |
(b) |
|
- |
|
|
- |
|
|
123,137 |
(c) |
Total loans, net |
|
|
$ |
3,964,572 |
|
$ |
4,091,866 |
|
$ |
4,089,708 |
|
$ |
4,147,692 |
|
$ |
4,298,965 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017 |
|
2017 |
|
2017 |
|
2016 |
|
2016 |
|
|||||
(Dollars in thousands) (unaudited) |
|
|
Q3 |
|
Q2 |
|
Q1 |
|
Q4 |
|
Q3 |
|
|||||
Quarterly loan production |
(13) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage |
|
|
$ |
32,559 |
|
$ |
45,877 |
|
$ |
43,474 |
|
$ |
51,208 |
|
$ |
51,022 |
|
Commercial |
|
|
|
46,180 |
|
|
80,367 |
|
|
46,451 |
|
|
86,832 |
|
|
62,628 |
|
Consumer |
|
|
|
33,741 |
|
|
49,652 |
|
|
42,149 |
|
|
42,295 |
|
|
43,636 |
|
Auto and Leasing |
|
|
|
78,313 |
|
|
78,584 |
|
|
86,784 |
|
|
77,602 |
|
|
69,523 |
|
Total |
|
|
$ |
190,793 |
|
$ |
254,480 |
|
$ |
218,858 |
|
$ |
257,937 |
|
$ |
226,809 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) During the Q3 2017, earnings were impacted by Hurricanes Irma and Maria, which struck the island on September 7, 2017 and September 20, 2017, respectively. Based on our assessment of the facts we have increased our provision for the allowance of loan losses in the 3Q 2017 $27 million, related to these hurricanes. |
|||||||||||||||||
(b) On June 30, 2017, the Company entered into an agreement for the sale of a municipality loan for $28.8 million. At June 30, 2017, this loan, which included a principal payment of $4.8 million received in July 1, 2017, was reported as other loans held for sale, at fair value. As a result of this transaction, the Company recognized a $4.3 million charge-off during the second quarter. Proceeds were received on July 5, 2017. An allowance of $5.9 million was created during the second quarter for the remaining portfolio of municipal loans. |
|||||||||||||||||
(c) During Q3 2016, the Company entered into an agreement to sell its outstanding participation in the PREPA line of credit for $124 million, slightly lower than the adjusted book balance, net of reserves. At September 30, 2016, this line of credit was reported as other loans held for sale, at fair value. Proceeds were received on October 7, 2016. As a result of this transaction, the Company recognized a $56.2 million charge-off and a $2.9 provision for loan and lease losses during the quarter ended September 30, 2016. |
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5 |
|
OFG Bancorp (NYSE: OFG) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Table 5: Average Balances, Net Interest Income and Net Interest Margin |
|
||||||||||||||||||||||||||||||||||||||||||||
|
|
|
2017 Q3 |
|
2017 Q2 |
|
2017 Q1 |
|
2016 Q4 |
|
2016 Q3 |
||||||||||||||||||||||||||||||||||
|
|
|
|
|
Interest |
|
|
|
|
|
|
Interest |
|
|
|
|
|
|
Interest |
|
|
|
|
|
|
Interest |
|
|
|
|
|
|
Interest |
|
|
|
|||||||||
|
|
|
Average |
|
Income/ |
|
Yield/ |
|
Average |
|
Income/ |
|
Yield/ |
|
Average |
|
Income/ |
|
Yield/ |
|
Average |
|
Income/ |
|
Yield/ |
|
Average |
|
Income/ |
|
Yield/ |
||||||||||||||
(Dollars in thousands) (unaudited) |
|
|
Balance |
|
Expense |
|
Rate |
|
Balance |
|
Expense |
|
Rate |
|
Balance |
|
Expense |
|
Rate |
|
Balance |
|
Expense |
|
Rate |
|
Balance |
|
Expense |
|
Rate |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash equivalents and securities purchased under agreements to resell |
|
|
$ |
426,196 |
|
$ |
1,304 |
|
1.21 |
% |
|
$ |
384,037 |
|
$ |
956 |
|
1.00 |
% |
|
$ |
431,110 |
|
$ |
845 |
|
0.79 |
% |
|
$ |
445,246 |
|
$ |
581 |
|
0.52 |
% |
|
$ |
477,968 |
|
$ |
661 |
|
0.55 |
% |
Investment securities |
|
|
|
1,170,714 |
|
|
6,584 |
|
2.23 |
% |
|
|
1,334,938 |
|
|
7,747 |
|
2.33 |
% |
|
|
1,360,186 |
|
|
7,683 |
|
2.29 |
% |
|
|
1,330,951 |
|
|
7,699 |
|
2.30 |
% |
|
|
1,293,251 |
|
|
7,319 |
|
2.25 |
% |
Loans |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-acquired loans |
|
|
|
3,062,739 |
|
|
58,939 |
|
7.63 |
% |
|
|
3,051,549 |
|
|
53,448 |
|
7.03 |
% |
|
|
3,015,456 |
|
|
51,955 |
|
6.99 |
% |
|
|
3,009,579 |
|
|
51,581 |
|
6.82 |
% |
|
|
3,160,091 |
|
|
50,569 |
|
6.35 |
% |
Acquired BBVAPR loans |
|
|
|
893,810 |
|
|
19,189 |
|
8.52 |
% |
|
|
949,479 |
|
|
17,752 |
|
7.50 |
% |
|
|
997,649 |
|
|
19,085 |
|
7.76 |
% |
|
|
1,050,468 |
|
|
20,232 |
|
7.66 |
% |
|
|
1,100,336 |
|
|
22,723 |
|
8.19 |
% |
Acquired Eurobank loans |
|
|
|
105,720 |
|
|
4,339 |
|
16.28 |
% |
|
|
128,522 |
|
|
6,037 |
|
18.84 |
% |
|
|
128,522 |
|
|
6,610 |
|
20.86 |
% |
|
|
135,919 |
|
|
6,701 |
|
19.61 |
% |
|
|
137,605 |
|
|
9,313 |
|
26.85 |
% |
Total loans |
|
|
|
4,062,269 |
|
|
82,467 |
|
8.05 |
% |
|
|
4,129,550 |
|
|
77,237 |
|
7.50 |
% |
|
|
4,141,627 |
|
|
77,650 |
|
7.60 |
% |
|
|
4,195,966 |
|
|
78,514 |
|
7.44 |
% |
|
|
4,398,032 |
|
|
82,605 |
|
7.45 |
% |
Total interest-earning assets |
|
|
$ |
5,659,179 |
|
$ |
90,355 |
|
6.33 |
% |
|
$ |
5,848,525 |
|
$ |
85,940 |
|
5.89 |
% |
|
$ |
5,932,923 |
|
$ |
86,178 |
|
5.89 |
% |
|
$ |
5,972,163 |
|
$ |
86,794 |
|
5.78 |
% |
|
$ |
6,169,251 |
|
$ |
90,585 |
|
5.83 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOW accounts |
|
|
$ |
1,024,480 |
|
$ |
880 |
|
0.34 |
% |
|
$ |
1,080,135 |
|
$ |
1,051 |
|
0.39 |
% |
|
$ |
1,092,389 |
|
$ |
1,041 |
|
0.39 |
% |
|
$ |
1,119,597 |
|
$ |
1,172 |
|
0.42 |
% |
|
$ |
1,243,640 |
|
$ |
1,314 |
|
0.42 |
% |
Savings accounts |
|
|
|
1,142,338 |
|
|
1,426 |
|
0.50 |
% |
|
|
1,151,650 |
|
|
1,485 |
|
0.52 |
% |
|
|
1,164,040 |
|
|
1,481 |
|
0.52 |
% |
|
|
1,126,600 |
|
|
1,384 |
|
0.49 |
% |
|
|
1,113,649 |
|
|
1,351 |
|
0.48 |
% |
Time deposits |
|
|
|
1,052,910 |
|
|
2,902 |
|
1.09 |
% |
|
|
1,037,063 |
|
|
2,802 |
|
1.08 |
% |
|
|
1,019,528 |
|
|
2,715 |
|
1.08 |
% |
|
|
1,045,732 |
|
|
2,794 |
|
1.06 |
% |
|
|
1,013,905 |
|
|
2,735 |
|
1.07 |
% |
Brokered deposits |
|
|
|
554,650 |
|
|
2,163 |
|
1.55 |
% |
|
|
575,642 |
|
|
2,084 |
|
1.45 |
% |
|
|
574,549 |
|
|
1,885 |
|
1.33 |
% |
|
|
583,607 |
|
|
1,895 |
|
1.29 |
% |
|
|
549,371 |
|
|
1,751 |
|
1.26 |
% |
|
|
|
|
3,774,378 |
|
|
7,371 |
|
0.77 |
% |
|
|
3,844,490 |
|
|
7,422 |
|
0.77 |
% |
|
|
3,850,506 |
|
|
7,122 |
|
0.75 |
% |
|
|
3,875,536 |
|
|
7,245 |
|
0.74 |
% |
|
|
3,920,565 |
|
|
7,151 |
|
0.72 |
% |
Non-interest bearing deposit accounts |
|
|
|
835,255 |
|
|
- |
|
- |
|
|
|
835,026 |
|
|
- |
|
- |
|
|
|
832,665 |
|
|
- |
|
- |
|
|
|
832,332 |
|
|
- |
|
- |
|
|
|
801,833 |
|
|
- |
|
- |
% |
Fair value premium amortization and core deposit intangible amortization |
|
|
|
- |
|
|
231 |
|
- |
|
|
|
- |
|
|
231 |
|
- |
|
|
|
- |
|
|
231 |
|
- |
|
|
|
- |
|
|
186 |
|
- |
|
|
|
- |
|
|
180 |
|
- |
|
Total deposits |
|
|
|
4,609,633 |
|
|
7,602 |
|
0.65 |
% |
|
|
4,679,516 |
|
|
7,653 |
|
0.66 |
% |
|
|
4,683,171 |
|
|
7,353 |
|
0.64 |
% |
|
|
4,707,868 |
|
|
7,431 |
|
0.63 |
% |
|
|
4,722,398 |
|
|
7,331 |
|
0.62 |
% |
Borrowings |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities sold under agreements to repurchase |
|
|
|
325,201 |
|
|
1,281 |
|
1.56 |
% |
|
|
472,338 |
|
|
1,733 |
|
1.47 |
% |
|
|
574,771 |
|
|
3,244 |
|
2.29 |
% |
|
|
608,802 |
|
|
4,177 |
|
2.73 |
% |
|
|
620,353 |
|
|
4,272 |
|
2.73 |
% |
Advances from FHLB and other borrowings |
|
|
|
100,751 |
|
|
596 |
|
2.35 |
% |
|
|
105,911 |
|
|
607 |
|
2.30 |
% |
|
|
105,097 |
|
|
596 |
|
2.30 |
% |
|
|
105,561 |
|
|
611 |
|
2.30 |
2 |
|
|
195,278 |
|
|
1,237 |
|
2.51 |
% |
Subordinated capital notes |
|
|
|
36,083 |
|
|
398 |
|
4.38 |
% |
|
|
36,083 |
|
|
384 |
|
4.27 |
% |
|
|
36,083 |
|
|
367 |
|
4.12 |
% |
|
|
36,083 |
|
|
362 |
|
3.99 |
% |
|
|
101,581 |
|
|
818 |
|
3.19 |
% |
Total borrowings |
|
|
|
462,035 |
|
|
2,275 |
|
1.95 |
% |
|
|
614,332 |
|
|
2,724 |
|
1.78 |
% |
|
|
715,951 |
|
|
4,207 |
|
2.38 |
% |
|
|
750,446 |
|
|
5,150 |
|
2.73 |
% |
|
|
917,212 |
|
|
6,327 |
|
2.74 |
% |
Total interest-bearing liabilities |
|
|
$ |
5,071,668 |
|
$ |
9,877 |
|
0.77 |
% |
|
$ |
5,293,848 |
|
$ |
10,377 |
|
0.79 |
% |
|
$ |
5,399,122 |
|
$ |
11,560 |
|
0.87 |
% |
|
$ |
5,458,314 |
|
$ |
12,581 |
|
0.92 |
% |
|
$ |
5,639,610 |
|
$ |
13,658 |
|
0.96 |
% |
Interest rate spread |
|
|
|
|
|
$ |
80,478 |
|
5.56 |
% |
|
|
|
|
$ |
75,563 |
|
5.10 |
% |
|
|
|
|
$ |
74,618 |
|
5.02 |
% |
|
|
|
|
$ |
74,213 |
|
4.86 |
% |
|
|
|
|
$ |
76,927 |
|
4.87 |
% |
Net interest margin |
|
|
|
|
|
|
|
|
5.64 |
% |
|
|
|
|
|
|
|
5.18 |
% |
|
|
|
|
|
|
|
5.10 |
% |
|
|
|
|
|
|
|
4.94 |
% |
|
|
|
|
|
|
|
4.95 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASC 310-30 loan cost recoveries: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquired BBVAPR loans |
|
|
|
|
|
$ |
3,220 |
|
|
|
|
|
|
|
$ |
300 |
|
|
|
|
|
|
|
$ |
245 |
|
|
|
|
|
|
|
$ |
130 |
|
|
|
|
|
|
|
$ |
809 |
|
|
|
Acquired Eurobank loans |
|
|
|
|
|
|
523 |
|
|
|
|
|
|
|
|
615 |
|
|
|
|
|
|
|
|
1,055 |
|
|
|
|
|
|
|
|
729 |
|
|
|
|
|
|
|
|
3,012 |
|
|
|
|
|
|
|
|
|
$ |
3,743 |
|
|
|
|
|
|
|
$ |
915 |
|
|
|
|
|
|
|
$ |
1,300 |
|
|
|
|
|
|
|
$ |
859 |
|
|
|
|
|
|
|
$ |
3,821 |
|
|
|
Adjusted excluding cost recoveries (Non-GAAP): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total interest-earning assets |
|
|
$ |
5,659,179 |
|
$ |
86,612 |
|
6.07 |
% |
|
$ |
5,848,525 |
|
$ |
85,025 |
|
5.83 |
% |
|
$ |
5,932,923 |
|
$ |
84,878 |
|
5.80 |
% |
|
$ |
5,972,163 |
|
$ |
85,935 |
|
5.72 |
% |
|
$ |
6,169,251 |
|
$ |
86,764 |
|
5.58 |
% |
Interest rate spread |
|
|
|
|
|
$ |
76,735 |
|
5.30 |
% |
|
|
|
|
$ |
74,648 |
|
5.04 |
% |
|
|
|
|
$ |
73,318 |
|
4.93 |
% |
|
|
|
|
$ |
73,354 |
|
4.80 |
% |
|
|
|
|
$ |
73,106 |
|
4.62 |
% |
Net interest margin |
|
|
|
|
|
|
|
|
5.38 |
% |
|
|
|
|
|
|
|
5.12 |
% |
|
|
|
|
|
|
|
5.01 |
% |
|
|
|
|
|
|
|
4.89 |
% |
|
|
|
|
|
|
|
4.70 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6 |
OFG Bancorp (NYSE: OFG) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Table 5: Average Balances, Net Interest Income and Net Interest Margin (Continued) |
|
|||||||||||||||||||
|
|
|
2017 YTD |
|
2016 YTD |
|
||||||||||||||
|
|
|
|
|
Interest |
|
|
|
|
|
|
Interest |
|
|
|
|
||||
|
|
|
Average |
|
Income/ |
|
Yield/ |
|
Average |
|
Income/ |
|
Yield/ |
|
||||||
(Dollars in thousands) (unaudited) |
|
|
Balance |
|
Expense |
|
Rate |
|
Balance |
|
Expense |
|
Rate |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest earning assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash equivalents and securities purchased under agreements to resell |
|
|
$ |
417,892 |
|
$ |
3,105 |
|
0.99 |
% |
|
$ |
497,795 |
|
$ |
1,919 |
|
0.51 |
% |
|
Investment securities |
|
|
|
1,287,919 |
|
|
22,014 |
|
2.29 |
% |
|
|
1,351,402 |
|
|
24,448 |
|
2.41 |
% |
|
Loans |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-acquired loans |
|
|
|
3,043,249 |
|
|
164,407 |
|
7.22 |
% |
|
|
3,129,851 |
|
|
147,592 |
|
6.28 |
% |
|
Acquired BBVAPR loans |
|
|
|
1,007,942 |
|
|
55,961 |
|
7.42 |
% |
|
|
1,170,893 |
|
|
72,042 |
|
8.20 |
% |
|
Acquired Eurobank loans |
|
|
|
118,857 |
|
|
16,986 |
|
19.11 |
% |
|
|
140,921 |
|
|
23,798 |
|
22.50 |
% |
|
Total loans |
|
|
|
4,170,048 |
|
|
237,354 |
|
7.61 |
% |
|
|
4,441,665 |
|
|
243,432 |
|
7.30 |
% |
|
Total interest-earning assets |
|
|
$ |
5,875,859 |
|
$ |
262,473 |
|
5.97 |
% |
|
$ |
6,290,862 |
|
$ |
269,799 |
|
5.71 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest bearing liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deposits |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOW accounts |
|
|
$ |
1,065,419 |
|
$ |
2,972 |
|
0.37 |
% |
|
$ |
1,208,943 |
|
$ |
3,914 |
|
0.43 |
% |
|
Savings accounts |
|
|
|
1,152,597 |
|
|
4,392 |
|
0.51 |
% |
|
|
1,111,012 |
|
|
4,057 |
|
0.49 |
% |
|
Time deposits |
|
|
|
1,036,623 |
|
|
8,420 |
|
1.09 |
% |
|
|
983,618 |
|
|
7,789 |
|
1.05 |
% |
|
Brokered deposits |
|
|
|
568,207 |
|
|
6,132 |
|
1.44 |
% |
|
|
631,643 |
|
|
5,555 |
|
1.17 |
% |
|
|
|
|
|
3,822,846 |
|
|
21,916 |
|
0.77 |
% |
|
|
3,935,216 |
|
|
21,315 |
|
0.72 |
% |
|
Non-interest bearing deposit accounts |
|
|
|
834,325 |
|
|
- |
|
- |
|
|
|
784,099 |
|
|
- |
|
- |
% |
|
Fair value premium amortization and core deposit intangible amortization |
|
|
|
- |
|
|
690 |
|
- |
|
|
|
- |
|
|
507 |
|
- |
|
|
Total deposits |
|
|
|
4,657,171 |
|
|
22,606 |
|
0.65 |
% |
|
|
4,719,315 |
|
|
21,822 |
|
0.62 |
% |
|
Borrowings |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Securities sold under agreements to repurchase |
|
|
|
456,523 |
|
|
6,260 |
|
1.83 |
% |
|
|
682,326 |
|
|
14,629 |
|
2.86 |
% |
|
Advances from FHLB and other borrowings |
|
|
|
103,807 |
|
|
1,799 |
|
2.32 |
% |
|
|
282,957 |
|
|
5,574 |
|
2.62 |
% |
|
Subordinated capital notes |
|
|
|
36,083 |
|
|
1,149 |
|
4.26 |
% |
|
|
102,379 |
|
|
2,560 |
|
3.33 |
% |
|
Total borrowings |
|
|
|
596,413 |
|
|
9,208 |
|
2.06 |
% |
|
|
1,067,662 |
|
|
22,763 |
|
2.84 |
% |
|
Total interest-bearing liabilities |
|
|
$ |
5,253,584 |
|
$ |
31,814 |
|
0.81 |
% |
|
$ |
5,786,977 |
|
$ |
44,585 |
|
1.03 |
% |
|
Interest rate spread |
|
|
|
|
|
$ |
230,659 |
|
5.16 |
% |
|
|
|
|
$ |
225,214 |
|
4.68 |
% |
|
Net interest margin |
|
|
|
|
|
|
|
|
5.25 |
% |
|
|
|
|
|
|
|
4.77 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASC 310-30 loan cost recoveries: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquired BBVAPR loans |
|
|
|
|
|
$ |
3,765 |
|
|
|
|
|
|
|
|
1,786 |
|
|
|
|
Acquired Eurobank loans |
|
|
|
|
|
|
2,193 |
|
|
|
|
|
|
|
|
4,877 |
|
|
|
|
|
|
|
|
|
|
$ |
5,958 |
|
|
|
|
|
|
|
$ |
6,663 |
|
|
|
|
Adjusted excluding cost recoveries (Non-GAAP): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total interest-earning assets |
|
|
$ |
5,875,859 |
|
$ |
256,515 |
|
5.84 |
% |
|
$ |
6,290,862 |
|
$ |
263,136 |
|
5.57 |
% |
|
Interest rate spread |
|
|
|
|
|
$ |
224,701 |
|
5.03 |
% |
|
|
|
|
$ |
218,551 |
|
4.54 |
% |
|
Net interest margin |
|
|
|
|
|
|
|
|
5.11 |
% |
|
|
|
|
|
|
|
4.63 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7 |
|
|
OFG Bancorp (NYSE: OFG) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 6: Loan Information and Performance Statistics (Excluding Acquired Loans) (1) |
|
|
|
|
|||||||||||||
|
|
|
2017 |
|
2017 |
|
2017 |
|
2016 |
|
2016 |
|
|||||
(Dollars in thousands) (unaudited) |
|
|
Q3 |
|
Q2 |
|
Q1 |
|
Q4 |
|
Q3 |
|
|||||
Net Charge-offs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charge-offs |
|
|
$ |
834 |
|
$ |
2,162 |
|
$ |
2,379 |
|
$ |
2,075 |
|
$ |
1,656 |
|
Recoveries |
|
|
|
(341) |
|
|
(63) |
|
|
(56) |
|
|
(125) |
|
|
(21) |
|
Total mortgage |
|
|
|
493 |
|
|
2,099 |
|
|
2,323 |
|
|
1,950 |
|
|
1,635 |
|
Commercial: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charge-offs |
|
|
|
727 |
|
|
4,841 |
(a) |
|
856 |
|
|
3,901 |
|
|
56,700 |
(c) |
Recoveries |
|
|
|
(654) |
|
|
(136) |
|
|
(89) |
|
|
(53) |
|
|
(93) |
|
Total commercial |
|
|
|
73 |
|
|
4,705 |
|
|
767 |
|
|
3,848 |
|
|
56,607 |
(c) |
Consumer: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charge-offs |
|
|
|
4,424 |
|
|
4,012 |
|
|
3,358 |
|
|
3,243 |
|
|
3,173 |
|
Recoveries |
|
|
|
(168) |
|
|
(780) |
(b) |
|
(165) |
|
|
(97) |
|
|
(120) |
|
Total consumer |
|
|
|
4,256 |
|
|
3,232 |
|
|
3,193 |
|
|
3,146 |
|
|
3,053 |
|
Auto and Leasing: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Charge-offs |
|
|
|
9,387 |
|
|
7,775 |
|
|
7,563 |
|
|
7,464 |
|
|
7,804 |
|
Recoveries |
|
|
|
(2,394) |
|
|
(4,176) |
(b) |
|
(3,294) |
|
|
(2,902) |
|
|
(3,747) |
|
Total auto and leasing |
|
|
|
6,993 |
|
|
3,599 |
|
|
4,269 |
|
|
4,562 |
|
|
4,057 |
|
Total |
|
|
$ |
11,815 |
|
$ |
13,635 |
|
$ |
10,552 |
|
$ |
13,506 |
|
$ |
65,352 |
(c) |
Net Charge-off Rates |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage |
|
|
|
0.28% |
|
|
1.20% |
|
|
1.31% |
|
|
1.07% |
|
|
0.88% |
|
Commercial |
|
|
|
0.02% |
|
|
1.50% |
(a) |
|
0.25% |
|
|
1.22% |
|
|
15.88% |
(c) |
Consumer |
|
|
|
5.65% |
|
|
4.42% |
(b) |
|
4.57% |
|
|
4.62% |
|
|
4.71% |
|
Auto and Leasing |
|
|
|
3.37% |
|
|
1.79% |
(b) |
|
2.19% |
|
|
2.44% |
|
|
2.23% |
|
Total |
|
|
|
1.54% |
|
|
1.79% |
|
|
1.40% |
|
|
1.80% |
|
|
8.27% |
(c) |
Average Loans Held For Investment |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage |
|
|
$ |
692,782 |
|
$ |
698,782 |
|
$ |
711,553 |
|
$ |
730,707 |
|
$ |
746,613 |
|
Commercial |
|
|
|
1,239,390 |
|
|
1,256,827 |
|
|
1,245,530 |
|
|
1,258,896 |
|
|
1,426,216 |
|
Consumer |
|
|
|
301,121 |
|
|
292,739 |
|
|
279,558 |
|
|
272,353 |
|
|
259,535 |
|
Auto and Leasing |
|
|
|
829,446 |
|
|
803,201 |
|
|
778,815 |
|
|
747,623 |
|
|
727,727 |
|
Total |
|
|
$ |
3,062,739 |
|
$ |
3,051,549 |
|
$ |
3,015,456 |
|
$ |
3,009,579 |
|
$ |
3,160,091 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) On June 30, 2017, the Company entered into an agreement for the sale of a municipality loan for $28.8 million. At June 30, 2017, this loan, which included a principal payment of $4.8 million received in July 1, 2017, was reported as other loans held for sale, at fair value. As a result of this transaction, the Company recognized a $4.3 million charge-off during the second quarter. Proceeds were received on July 5, 2017. An allowance of $5.9 million was created during the second quarter for the remaining portfolio of municipal loans. |
|
||||||||||||||||
(b) During Q2 2017 , the Company had additional recoveries in auto and consumer loans of $1.1 million and $612 thousand, respectively. |
|
||||||||||||||||
(c) During Q3 2016, the Company entered into an agreement to sell its outstanding participation in the PREPA line of credit for $124 million, slightly lower than the adjusted book balance, net of reserves. At September 30, 2016, this line of credit was reported as other loans held for sale, at fair value. Proceeds were received on October 7, 2016. As a result of this transaction, the Company recognized a $56.2 million charge-off and a $2.9 provision for loan and lease losses during the quarter ended September 30, 2016. |
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8 |
|
OFG Bancorp (NYSE: OFG) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 6: Loan Information and Performance Statistics (Excluding Acquired Loans) (Continued) (1) |
|
||||||||||||||||
|
|
|
2017 |
|
2017 |
|
2017 |
|
2016 |
|
2016 |
|
|||||
(Dollars in thousands) (unaudited) |
|
|
Q3 |
|
Q2 |
|
Q1 |
|
Q4 |
|
Q3 |
|
|||||
Early Delinquency (30 - 89 days past due) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage |
|
|
$ |
35,273 |
|
$ |
32,292 |
|
$ |
30,827 |
|
$ |
32,516 |
|
$ |
37,015 |
|
Commercial |
|
|
|
2,727 |
|
|
4,648 |
|
|
5,708 |
|
|
1,602 |
|
|
4,177 |
|
Consumer |
|
|
|
7,504 |
|
|
5,495 |
|
|
6,024 |
|
|
5,106 |
|
|
4,796 |
|
Auto and Leasing |
|
|
|
71,606 |
|
|
66,372 |
|
|
61,912 |
|
|
61,728 |
|
|
65,302 |
|
Total |
|
|
$ |
117,110 |
(a) |
$ |
108,807 |
|
$ |
104,471 |
|
$ |
100,952 |
|
$ |
111,290 |
|
Early Delinquency Rates (30 - 89 days past due) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage |
|
|
|
5.08% |
|
|
4.62% |
|
|
4.34% |
|
|
4.51% |
|
|
5.03% |
|
Commercial |
|
|
|
0.22% |
|
|
0.37% |
|
|
0.46% |
|
|
0.13% |
|
|
0.33% |
|
Consumer |
|
|
|
2.37% |
|
|
1.75% |
|
|
2.01% |
|
|
1.76% |
|
|
1.72% |
|
Auto and Leasing |
|
|
|
8.61% |
|
|
8.22% |
|
|
7.87% |
|
|
8.16% |
|
|
8.94% |
|
Total |
|
|
|
3.79% |
(a) |
|
3.52% |
|
|
3.42% |
|
|
3.31% |
|
|
3.70% |
|
Total Delinquency (30 days and over past due) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Traditional, Non traditional, and Loans under Loss Mitigation |
|
|
$ |
88,936 |
|
$ |
85,908 |
|
$ |
90,849 |
|
$ |
98,506 |
|
$ |
103,770 |
|
GNMA's buy-back option program |
|
|
|
12,999 |
|
|
9,229 |
|
|
9,973 |
|
|
9,681 |
|
|
9,598 |
|
Total mortgage |
|
|
|
101,935 |
|
|
95,137 |
|
|
100,822 |
|
|
108,187 |
|
|
113,368 |
|
Commercial |
|
|
|
18,149 |
|
|
18,154 |
|
|
15,711 |
|
|
12,798 |
|
|
14,947 |
|
Consumer |
|
|
|
8,847 |
|
|
7,275 |
|
|
7,383 |
|
|
6,752 |
|
|
6,302 |
|
Auto and Leasing |
|
|
|
82,437 |
|
|
74,577 |
|
|
69,622 |
|
|
69,901 |
|
|
73,708 |
|
Total |
|
|
$ |
211,368 |
(a) |
$ |
195,143 |
|
$ |
193,538 |
|
$ |
197,638 |
|
$ |
208,325 |
|
Total Delinquency Rates (30 days and over past due) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Traditional, Non traditional, and Loans under Loss Mitigation |
|
|
|
12.81% |
|
|
12.29% |
|
|
12.80% |
|
|
13.65% |
|
|
14.11% |
|
GNMA's buy-back option program |
|
|
|
1.87% |
|
|
1.32% |
|
|
1.40% |
|
|
1.34% |
|
|
1.31% |
|
Total mortgage |
|
|
|
14.68% |
|
|
13.60% |
|
|
14.20% |
|
|
14.99% |
|
|
15.42% |
|
Commercial |
|
|
|
1.46% |
|
|
1.43% |
|
|
1.25% |
|
|
1.00% |
|
|
1.18% |
|
Consumer |
|
|
|
2.80% |
|
|
2.31% |
|
|
2.46% |
|
|
2.32% |
|
|
2.26% |
|
Auto and Leasing |
|
|
|
9.92% |
|
|
9.24% |
|
|
8.85% |
|
|
9.24% |
|
|
10.09% |
|
Total |
|
|
|
6.84% |
(a) |
|
6.31% |
|
|
6.34% |
|
|
6.49% |
|
|
6.92% |
|
Nonperforming Assets |
(14) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage |
|
|
$ |
59,667 |
|
$ |
63,071 |
|
$ |
66,781 |
|
$ |
74,503 |
|
$ |
75,592 |
|
Commercial |
|
|
|
21,701 |
|
|
23,519 |
|
|
19,387 |
|
|
19,786 |
|
|
23,347 |
|
Consumer |
|
|
|
2,445 |
|
|
2,687 |
|
|
1,948 |
|
|
1,986 |
|
|
2,470 |
|
Auto and Leasing |
|
|
|
11,811 |
|
|
8,295 |
|
|
8,709 |
|
|
9,052 |
|
|
9,477 |
|
Total nonperforming loans |
|
|
|
95,624 |
(a) |
|
97,572 |
|
|
96,825 |
|
|
105,327 |
|
|
110,886 |
|
Foreclosed real estate |
|
|
|
14,677 |
|
|
15,320 |
|
|
12,946 |
|
|
11,867 |
|
|
9,819 |
|
Other repossessed assets |
|
|
|
3,635 |
|
|
2,921 |
|
|
2,600 |
|
|
2,408 |
|
|
2,462 |
|
Total nonperforming assets |
|
|
$ |
113,936 |
|
$ |
115,813 |
|
$ |
112,371 |
|
$ |
119,602 |
|
$ |
123,167 |
|
Nonperforming Loan Rates |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage |
|
|
|
8.59% |
|
|
9.02% |
|
|
9.41% |
|
|
10.33% |
|
|
10.28% |
|
Commercial |
|
|
|
1.74% |
|
|
1.85% |
|
|
1.55% |
|
|
1.55% |
|
|
1.84% |
|
Consumer |
|
|
|
0.77% |
|
|
0.86% |
|
|
0.65% |
|
|
0.68% |
|
|
0.89% |
|
Auto and Leasing |
|
|
|
1.42% |
|
|
1.03% |
|
|
1.11% |
|
|
1.20% |
|
|
1.30% |
|
Total loans |
|
|
|
3.10% |
(a) |
|
3.16% |
|
|
3.17% |
|
|
3.46% |
|
|
3.68% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) After Hurricane Irma and Maria on September 7, 2017 and September 20, 2017, respectively, the Company offered an automatic three-month moratorium for the payment of principal and interest for auto, personal, credit cards and non-conforming mortgage loans, for customers whose payments were not over 89 days past due at August 31, 2017. Both, interest and principal will be payable at the maturity of the loan. For conforming mortgage loans the same moratorium applies, but the interest and principal will be payable in aggregate with the next payment due after the moratorium period. The Company also offered an automatic one-month moratorium for the payment of principal and interest for commercial loans, for customers whose payments were not over 30 days past due at August 31, 2017and the flexibility of extending it up to two additional months, if the customer needs it. |
|
||||||||||||||||
9 |
|
OFG Bancorp (NYSE: OFG) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 7: Allowance for Loan and Lease Losses |
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
|
Quarter Ended September 31, 2017 |
||||||||||||||||
|
|
|
|
|
|
|
|
|
Auto and |
|
|
|
|
||||||
(Dollars in thousands) (unaudited) |
|
|
Mortgage |
|
Commercial |
|
Consumer |
|
Leasing |
|
Unallocated |
|
Total |
||||||
Non-acquired loans |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at beginning of period |
|
|
$ |
18,664 |
|
$ |
17,279 |
|
$ |
14,981 |
|
$ |
18,742 |
|
$ |
- |
|
$ |
69,666 |
Provision (recapture) for loan and lease losses, net |
|
(a) |
|
4,137 |
|
|
7,074 |
|
|
5,068 |
|
|
13,413 |
|
|
- |
|
|
29,692 |
Charge-offs |
|
|
|
(834) |
|
|
(727) |
|
|
(4,424) |
|
|
(9,387) |
|
|
- |
|
|
(15,372) |
Recoveries |
|
|
|
341 |
|
|
654 |
|
|
168 |
|
|
2,394 |
|
|
- |
|
|
3,557 |
Balance at end of period |
|
|
$ |
22,308 |
|
$ |
24,280 |
|
$ |
15,793 |
|
$ |
25,162 |
|
$ |
- |
|
$ |
87,543 |
Allowance coverage ratio |
|
|
|
3.21% |
|
|
1.95% |
|
|
4.99% |
|
|
3.03% |
|
|
0.00% |
|
|
2.83% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquired loans |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquired BBVAPR loans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquired loans accounted for under ASC 310-20 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at beginning of period |
|
|
|
|
|
$ |
41 |
|
$ |
2,623 |
|
$ |
684 |
|
$ |
- |
|
$ |
3,348 |
Provision (recapture) for loan and lease losses, net |
|
(a) |
|
|
|
|
(1) |
|
|
646 |
|
|
67 |
|
|
- |
|
|
712 |
Charge-offs |
|
|
|
|
|
|
- |
|
|
(711) |
|
|
(222) |
|
|
- |
|
|
(933) |
Recoveries |
|
|
|
|
|
|
1 |
|
|
33 |
|
|
202 |
|
|
- |
|
|
236 |
Balance at end of period |
|
|
|
|
|
$ |
41 |
|
$ |
2,591 |
|
$ |
731 |
|
$ |
- |
|
$ |
3,363 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquired loans accounted for under ASC 310-30 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at beginning of period |
|
|
$ |
4,141 |
|
$ |
25,614 |
|
$ |
- |
|
$ |
7,739 |
|
$ |
- |
|
$ |
37,494 |
Provision for loan and lease losses, net |
|
(a) |
|
4,790 |
|
|
6,810 |
|
|
3 |
|
|
(501) |
|
|
- |
|
|
11,102 |
Allowance de-recognition |
|
(b) |
|
- |
|
|
(8,483) |
(a) |
|
- |
|
|
- |
|
|
- |
|
|
(8,483) |
Balance at end of period |
|
|
$ |
8,931 |
|
$ |
23,941 |
|
$ |
3 |
|
$ |
7,238 |
|
$ |
- |
|
$ |
40,113 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquired Eurobank loans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at beginning of period |
|
|
$ |
13,651 |
|
|
8,131 |
|
|
5 |
|
|
- |
|
|
- |
|
$ |
21,787 |
Provision (recapture) for loan and lease losses, net |
|
(a) |
|
1,139 |
|
|
1,402 |
|
|
- |
|
|
- |
|
|
- |
|
|
2,541 |
Allowance de-recognition |
|
|
|
(571) |
|
|
(611) |
|
|
- |
|
|
- |
|
|
- |
|
|
(1,182) |
Balance at end of period |
|
|
$ |
14,219 |
|
$ |
8,922 |
|
$ |
5 |
|
$ |
- |
|
$ |
- |
|
$ |
23,146 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total acquired loans |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at beginning of period |
|
|
$ |
17,792 |
|
|
33,786 |
|
|
2,628 |
|
|
8,423 |
|
|
- |
|
|
62,629 |
Provision (recapture) for loan and lease losses, net |
|
(a) |
|
5,929 |
|
|
8,211 |
|
|
649 |
|
|
(434) |
|
|
- |
|
|
14,355 |
Charge-offs |
|
|
|
- |
|
|
- |
|
|
(711) |
|
|
(222) |
|
|
- |
|
|
(933) |
Recoveries |
|
|
|
- |
|
|
1 |
|
|
33 |
|
|
202 |
|
|
- |
|
|
236 |
Allowance de-recognition |
|
|
|
(571) |
|
|
(9,094) |
|
|
- |
|
|
- |
|
|
- |
|
|
(9,665) |
Balance at end of period |
|
|
$ |
23,150 |
|
$ |
32,904 |
|
$ |
2,599 |
|
$ |
7,969 |
|
$ |
- |
|
$ |
66,622 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) During the Q3 2017, earnings were impacted by Hurricanes Irma and Maria, which struck the island on September 7, 2017 and September 20, 2017, respectively. Based on our assessment of the facts we have increased our provision for the allowance of loan losses in the 3Q 2017 $27 million, related to these hurricanes. |
|||||||||||||||||||
(b) During the Q3 2017, the Company de-recognized $8.0 million of allowance for loan losses related to the PRFHA loan. |
|||||||||||||||||||
10 |
OFG Bancorp (NYSE: OFG) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 8: Accretable Yield on Loans Accounted for Under ASC 310-30 (Loans Acquired with Deteriorated Credit Quality, including those by Analogy) |
|||||||||||||||||||
|
|
|
Quarter Ended September 30, 2017 |
||||||||||||||||
(Dollars in thousands) (unaudited) |
|
|
Mortgage |
|
Commercial |
|
Construction |
|
Auto |
|
Consumer |
|
Total |
||||||
Accretable Yield and Non-Accretable Discount |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquired BBVAPR loans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accretable Yield |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at beginning of period |
|
|
$ |
270,148 |
|
$ |
44,720 |
|
$ |
11,318 |
|
$ |
4,853 |
|
$ |
1,486 |
|
$ |
332,525 |
Accretion |
|
|
|
(7,434) |
|
$ |
(5,882) |
|
$ |
(1,232) |
|
$ |
(1,350) |
|
$ |
(384) |
|
$ |
(16,282) |
Change in expected cash flows |
|
|
|
- |
|
|
3,668 |
(a) |
|
48 |
|
|
13 |
|
|
37 |
|
|
3,766 |
Transfers (to) from non-accretable discount |
|
|
|
(6,158) |
|
|
(2,885) |
|
|
(65) |
|
|
(8) |
|
|
26 |
|
|
(9,090) |
Balance at end of period |
|
|
$ |
256,556 |
|
$ |
39,621 |
|
$ |
10,069 |
|
$ |
3,508 |
|
$ |
1,165 |
|
$ |
310,919 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Accretable Discount |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at beginning of period |
|
|
$ |
306,504 |
|
$ |
9,620 |
|
$ |
7,247 |
|
$ |
23,960 |
|
$ |
19,431 |
|
$ |
366,762 |
Change in actual and expected cash flows |
|
|
|
(2,310) |
|
|
(8,655) |
|
|
(24) |
|
|
(191) |
|
|
(124) |
|
|
(11,304) |
Transfers from (to) accretable yield |
|
|
|
6,158 |
|
|
2,885 |
|
|
65 |
|
|
8 |
|
|
(26) |
|
|
9,090 |
Balance at end of period |
|
|
$ |
310,352 |
|
$ |
3,850 |
|
$ |
7,288 |
|
$ |
23,777 |
|
$ |
19,281 |
|
$ |
364,548 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
Construction & |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Development |
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans Secured |
|
|
|
|
Secured by |
|
|
|
|
|
|
|
|
|
||
|
|
|
by 1-4 Family |
|
Commercial |
|
1-4 Family |
|
|
|
|
|
|
|
|
|
|||
|
|
|
Residential |
|
and Other |
|
Residential |
|
|
|
|
|
|
|
|
|
|||
|
|
|
Properties |
|
Construction |
|
Properties |
|
Leasing |
|
Consumer |
|
Total |
||||||
Acquired Eurobank loans: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accretable Yield |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at beginning of period |
|
|
$ |
43,012 |
|
$ |
9,157 |
|
$ |
1,906 |
|
$ |
- |
|
$ |
- |
|
$ |
54,075 |
Accretion |
|
|
|
(1,736) |
|
|
(2,480) |
|
|
(39) |
|
|
(11) |
|
|
(73) |
|
|
(4,339) |
Change in expected cash flows |
|
|
|
18 |
|
|
106 |
|
|
39 |
|
|
(49) |
|
|
346 |
|
|
460 |
Transfers from (to) non-accretable discount |
|
|
|
1,094 |
|
|
1,448 |
|
|
(142) |
|
|
60 |
|
|
(273) |
|
|
2,187 |
Balance at end of period |
|
|
$ |
42,388 |
|
$ |
8,231 |
|
$ |
1,764 |
|
$ |
- |
|
$ |
- |
|
$ |
52,383 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Accretable Discount |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at beginning of period |
|
|
$ |
6,687 |
|
$ |
2,010 |
|
$ |
299 |
|
$ |
- |
|
$ |
14 |
|
$ |
9,010 |
Change in actual and expected cash flows |
|
|
|
20 |
|
|
126 |
|
|
(39) |
|
|
60 |
|
|
(55) |
|
|
112 |
Transfers (to) from accretable yield |
|
|
|
(1,094) |
|
|
(1,448) |
|
|
142 |
|
|
(60) |
|
|
273 |
|
|
(2,187) |
Balance at end of period |
|
|
$ |
5,613 |
|
$ |
688 |
|
$ |
402 |
|
$ |
- |
|
$ |
232 |
|
$ |
6,935 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) During Q3 2017, the Company recognized $3.1 million in cost recoveries from the Puerto Rico Housing Finance Authority ("PRHFA") loan with an outstanding principal balance of $10.9 million. |
|||||||||||||||||||
11 |
OFG Bancorp (NYSE: OFG) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 9: Reconciliation of GAAP to Non-GAAP Measures and Calculation of Regulatory Capital |
||||||||||||||||
|
||||||||||||||||
In addition to disclosing required regulatory capital measures, we also report certain non-GAAP capital measures that management uses in assessing its capital adequacy. These non-GAAP measures include tangible common equity ("TCE") and TCE ratio. The table below provides the details of the calculation of our regulatory capital and non-GAAP capital measures. While our non-GAAP capital measures are widely used by investors, analysts and bank regulatory agencies to assess the capital position of financial services companies, they may not be comparable to similarly titled measures reported by other companies. |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017 |
|
2017 |
|
2017 |
|
2016 |
|
2016 |
|||||
(Dollars in thousands) (unaudited) |
|
|
Q3 |
|
Q2 |
|
Q1 |
|
Q4 |
|
Q3 |
|||||
Stockholders' Equity to Non-GAAP Tangible Common Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders' equity |
|
|
$ |
937,630 |
|
$ |
938,969 |
|
$ |
931,429 |
|
$ |
920,411 |
|
$ |
924,934 |
Less: Intangible assets |
|
|
|
(91,124) |
|
|
(91,493) |
|
|
(91,861) |
|
|
(92,229) |
|
|
(92,648) |
Noncumulative perpetual preferred stock |
|
|
|
(176,000) |
|
|
(176,000) |
|
|
(176,000) |
|
|
(176,000) |
|
|
(176,000) |
Noncumulative perpetual preferred stock issuance costs |
|
|
|
10,130 |
|
|
10,130 |
|
|
10,130 |
|
|
10,130 |
|
|
10,130 |
Tangible common equity |
|
|
$ |
680,636 |
|
$ |
681,606 |
|
$ |
673,698 |
|
$ |
662,312 |
|
$ |
666,416 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock outstanding at end of period |
|
|
|
43,947 |
|
|
43,947 |
|
|
43,947 |
|
|
43,915 |
|
|
43,914 |
Tangible book value (Non-GAAP) |
|
|
$ |
15.49 |
|
$ |
15.51 |
|
$ |
15.33 |
|
$ |
15.08 |
|
$ |
15.18 |
Total Assets to Tangible Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
|
$ |
6,288,217 |
|
$ |
6,235,826 |
|
$ |
6,414,607 |
|
$ |
6,501,824 |
|
$ |
6,592,113 |
Less: Intangible assets |
|
|
|
(91,124) |
|
|
(91,493) |
|
|
(91,861) |
|
|
(92,229) |
|
|
(92,648) |
Tangible assets (Non-GAAP) |
|
|
$ |
6,197,093 |
|
$ |
6,144,333 |
|
$ |
6,322,746 |
|
$ |
6,409,595 |
|
$ |
6,499,465 |
Non-GAAP TCE Ratio |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tangible common equity |
|
|
$ |
680,636 |
|
$ |
681,606 |
|
$ |
673,698 |
|
$ |
662,312 |
|
$ |
666,416 |
Tangible assets |
|
|
|
6,197,093 |
|
|
6,144,333 |
|
|
6,322,746 |
|
|
6,409,595 |
|
|
6,499,465 |
TCE ratio |
|
|
|
10.98% |
|
|
11.09% |
|
|
10.66% |
|
|
10.33% |
|
|
10.25% |
Average Equity to Non-GAAP Average Tangible Common Equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average total stockholders' equity |
|
|
$ |
947,404 |
|
$ |
938,707 |
|
$ |
926,011 |
|
$ |
919,697 |
|
$ |
919,171 |
Less: Average noncumulative perpetual preferred stock |
|
|
|
(176,000) |
|
|
(176,000) |
|
|
(176,000) |
|
|
(176,000) |
|
|
(176,000) |
Average noncumulative perpetual preferred stock issuance costs |
|
|
|
10,130 |
|
|
10,130 |
|
|
10,130 |
|
|
10,130 |
|
|
10,130 |
Average total common stockholders' equity |
|
|
$ |
781,534 |
|
$ |
772,837 |
|
$ |
760,141 |
|
$ |
753,827 |
|
$ |
753,301 |
Less: Average intangible assets |
|
|
|
(91,331) |
|
|
(91,731) |
|
|
(92,102) |
|
|
(92,502) |
|
|
(92,922) |
Average tangible common equity |
|
|
$ |
690,203 |
|
$ |
681,106 |
|
$ |
668,039 |
|
$ |
661,325 |
|
$ |
660,379 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Metrics for Hurricanes Irma and Maria - Reconciliation to GAAP Financial Measures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
$ |
3,319 |
|
$ |
17,104 |
|
$ |
15,150 |
|
$ |
15,556 |
|
$ |
15,119 |
Plus: Additional loan loss provision from Hurricanes Irma and Maria |
|
|
|
27,000 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
Less: Income tax effect |
|
|
|
(8,038) |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
Net income, excluding hurricanes loan provision |
|
|
$ |
22,281 |
|
$ |
17,104 |
|
$ |
15,150 |
|
$ |
15,556 |
|
$ |
15,119 |
Less: dividends on preferred stock |
|
|
|
(3,465) |
|
|
(3,466) |
|
|
(3,465) |
|
|
(3,466) |
|
|
(3,465) |
Net income available to common shareholders, excluding hurricanes loan provision |
|
|
$ |
18,816 |
|
$ |
13,638 |
|
$ |
11,685 |
|
$ |
12,090 |
|
$ |
11,654 |
Plus: Effect of assumed conversion of the convertible preferred stock |
|
|
|
1,838 |
|
|
1,837 |
|
|
1,838 |
|
|
1,837 |
|
|
1,838 |
|
|
|
$ |
20,654 |
|
$ |
15,475 |
|
$ |
13,523 |
|
$ |
13,927 |
|
$ |
13,492 |
Average common shares outstanding and equivalents |
|
|
|
51,102 |
|
|
51,100 |
|
|
51,131 |
|
|
51,098 |
|
|
51,111 |
Earnings per common share - diluted, excluding hurricanes loan provision |
|
|
$ |
0.40 |
|
$ |
0.30 |
|
$ |
0.26 |
|
$ |
0.27 |
|
$ |
0.26 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income, excluding hurricanes loan provision |
|
|
$ |
22,281 |
|
$ |
17,104 |
|
$ |
15,150 |
|
$ |
15,556 |
|
$ |
15,119 |
Average assets, excluding hurricanes loan provision |
|
|
$ |
6,048,021 |
|
$ |
6,278,464 |
|
$ |
6,374,177 |
|
$ |
6,455,023 |
|
$ |
6,653,446 |
Return on average assets, excluding hurricanes loan provision |
|
|
|
1.47% |
|
|
1.09% |
|
|
0.95% |
|
|
0.96% |
|
|
0.91% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income available to common shareholders, excluding hurricanes loan provision |
|
|
$ |
18,816 |
|
$ |
13,638 |
|
$ |
11,685 |
|
$ |
12,090 |
|
$ |
11,654 |
Average common stockholders' equity, excluding hurricanes loan provision |
|
|
$ |
690,422 |
|
$ |
681,106 |
|
$ |
668,039 |
|
$ |
661,325 |
|
$ |
660,379 |
Return on average tangible common stockholders' equity |
|
|
|
10.90% |
|
|
8.01% |
|
|
7.00% |
|
|
7.31% |
|
|
7.06% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12 |
OFG Bancorp (NYSE: OFG) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 9: Reconciliation of GAAP to Non-GAAP Measures and Calculation of Regulatory Capital Measures (Continued) |
|
||||||||||||||||
|
|
||||||||||||||||
|
|
|
BASEL III |
|
|||||||||||||
|
|
|
Standardized |
|
|||||||||||||
|
|
|
2017 |
|
2017 |
|
2017 |
|
2016 |
|
2016 |
|
|||||
(Dollars in thousands) (unaudited) |
|
|
Q3 |
|
Q2 |
|
Q1 |
|
Q4 |
|
Q3 |
|
|||||
Regulatory Capital Metrics |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common equity Tier 1 capital |
|
|
$ |
633,401 |
|
$ |
643,606 |
|
$ |
626,707 |
|
$ |
627,732 |
|
$ |
612,792 |
|
Tier 1 capital |
|
|
|
830,640 |
|
|
840,703 |
|
|
822,847 |
|
|
819,661 |
|
|
801,882 |
|
Total risk-based capital |
(15) |
|
|
885,523 |
|
|
896,926 |
|
|
878,867 |
|
|
876,656 |
|
|
860,513 |
|
Risk-weighted assets |
|
|
|
4,252,605 |
|
|
4,391,321 |
|
|
4,383,517 |
|
|
4,467,556 |
|
|
4,593,340 |
|
Regulatory Capital Ratios |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common equity Tier 1 capital ratio |
(16) |
|
|
14.89% |
|
|
14.66% |
|
|
14.30% |
|
|
14.05% |
|
|
13.34% |
|
Tier 1 risk-based capital ratio |
(17) |
|
|
19.53% |
|
|
19.14% |
|
|
18.77% |
|
|
18.35% |
|
|
17.46% |
|
Total risk-based capital ratio |
(18) |
|
|
20.82% |
|
|
20.42% |
|
|
20.05% |
|
|
19.62% |
|
|
18.73% |
|
Leverage ratio |
(19) |
|
|
14.07% |
|
|
13.69% |
|
|
13.20% |
|
|
12.99% |
|
|
12.35% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Equity Tier 1 Capital Ratio Under Basel III Standardized Approach |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders' equity |
|
|
$ |
937,630 |
|
$ |
938,969 |
|
$ |
931,429 |
|
$ |
920,411 |
|
$ |
924,934 |
|
Less: Noncumulative perpetual preferred stock |
|
|
|
(176,000) |
|
|
(176,000) |
|
|
(176,000) |
|
|
(176,000) |
|
|
(176,000) |
|
Noncumulative perpetual preferred stock issuance costs |
|
|
|
10,130 |
|
|
10,130 |
|
|
10,130 |
|
|
10,130 |
|
|
10,130 |
|
Unrealized gains on available-for-sale securities, net of income tax |
|
|
|
(1,371) |
|
|
(256) |
|
|
(3,849) |
|
|
(2,209) |
|
|
(17,554) |
|
Unrealized losses on cash flow hedges, net of income tax |
|
|
|
529 |
|
|
563 |
|
|
501 |
|
|
612 |
|
|
1,710 |
|
|
|
|
|
770,918 |
|
|
773,406 |
|
|
762,211 |
|
|
752,944 |
|
|
743,220 |
|
Less: Disallowed goodwill |
|
|
|
(86,069) |
|
|
(86,069) |
|
|
(86,069) |
|
|
(86,069) |
|
|
(86,069) |
|
Disallowed other intangible assets, net |
(20) |
|
|
(2,466) |
|
|
(2,646) |
|
|
(2,826) |
|
|
(2,255) |
|
|
(2,408) |
|
Disallowed deferred tax assets, net |
(20) |
|
|
(48,982) |
|
|
(41,085) |
|
|
(46,609) |
|
|
(36,888) |
|
|
(41,951) |
|
Common equity Tier 1 capital |
|
|
|
633,401 |
|
|
643,606 |
|
|
626,707 |
|
|
627,732 |
|
|
612,792 |
|
Plus: Qualifying noncumulative perpetual preferred stock |
|
|
|
176,000 |
|
|
176,000 |
|
|
176,000 |
|
|
176,000 |
|
|
176,000 |
|
Qualifying noncumulative perpetual preferred stock issuance costs |
|
|
|
(10,130) |
|
|
(10,130) |
|
|
(10,130) |
|
|
(10,130) |
|
|
(10,130) |
|
Subordinated capital notes |
|
|
|
35,000 |
|
|
35,000 |
|
|
35,000 |
|
|
35,000 |
|
|
35,000 |
|
Less: Disallowed deferred tax assets, net |
|
|
|
(3,631) |
|
|
(3,773) |
|
|
(4,730) |
|
|
(8,941) |
|
|
(11,780) |
|
Tier 1 capital |
|
|
|
830,640 |
|
|
840,703 |
|
|
822,847 |
|
|
819,661 |
|
|
801,882 |
|
Plus tier 2 capital: Qualifying allowance for loan and lease losses |
|
|
|
54,883 |
|
|
56,223 |
|
|
56,020 |
|
|
56,995 |
|
|
58,631 |
|
Total risk-based capital |
|
|
$ |
885,523 |
|
$ |
896,926 |
|
$ |
878,867 |
|
$ |
876,656 |
|
$ |
860,513 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13 |
|
OFG Bancorp (NYSE: OFG) |
|
|
|
|||||||||
Table 10: Notes to Financial Summary, Selected Metrics, Loans, and Consolidated Financial Statements (Tables 1 - 9) |
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
We use the term "acquired loans" to refer to loans acquired from the BBVAPR acquisition (December 18, 2012) and loans acquired in the Eurobank FDIC-Assisted acquisition (April 30, 2010), recorded at fair value at acquisition. The majority of these loans acquired are subsequently accounted for based on estimated cash flows expected to be collected over the life of the loans (under the accounting standard known as ASC 310-30). Because the guidance takes into consideration future credit losses expected to be incurred over the life of the loans, there are no charge-offs or an allowance associated with this loans unless the estimated cash flows expected to be collected decrease subsequent to acquisition. In addition, these loans are not classified as delinquent or nonperforming even though the customer may be contractually past due because we expect that we will fully collect the carrying value of these loans. Acquired loans also include loans acquired in the BBVAPR acquisition that were accounted for under the provisions of ASC 310-20, which at the end of the reporting period still have unamortized premium or discount. The fair value of these loans already include a credit mark for losses estimated on these loans. The allowance for loan and lease losses for these loans considers such marks applied. The accounting and classification of these loans may significantly alter some of our reported credit quality metrics. We therefore supplement certain reported credit quality metrics with metrics adjusted to exclude the impact of these acquired loans. |
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(2) |
Total banking and wealth management revenues. |
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(3) |
Calculated based on net income available to common shareholders divided by average common shares outstanding for the period. |
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(4) |
Calculated based on net income available to common shareholders plus the preferred dividends on the convertible preferred stock, divided by total average common shares outstanding and equivalents for the period as if converted. |
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(5) |
Tangible book value per common share is a non-GAAP measure calculated based on tangible common equity divided by common shares outstanding. See "Table 9: Reconciliation of GAAP to Non-GAAP Measures and Calculation of Regulatory Capital Measures" for additional information. |
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(6) |
Information includes all loans held for investment, including all acquired loans. Acquired loans, including those accounted for under ASC 310-30, are disclosed at carrying amount. |
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(7) |
Calculated based on annualized net interest income for the period divided by average interest-earning assets for the period. |
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(8) |
Calculated based on annualized income, net of tax, for the period divided by average total assets for the period. |
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(9) |
Calculated based on annualized income available to common shareholders for the period divided by average tangible common equity for the period. |
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(10) |
Calculated based on non-interest expense for the period divided by total net interest income and total banking and financial services revenues for the period. |
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(11) |
Calculated based on annualized net charge-offs for the period divided by average loans held for investment for the period. |
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(12) |
Non-GAAP ratios. See "Table 9: Reconciliation of GAAP to Non-GAAP Measures and Calculation of Regulatory Capital Measures" for information on the calculation of each of these ratios. |
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(13) |
Production of new loans (excluding renewals). |
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(14) |
Loans accounted for under ASC 310-30 (loans acquired with deteriorated credit quality, including those by analogy), including Eurobank acquired loans, 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. Therefore, they are not included as non-performing loans. |
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(15) |
Total risk-based capital equals the sum of Tier 1 capital and Tier 2 capital. |
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(16) |
Common equity Tier 1 capital ratio is a regulatory capital measure calculated based on Common equity Tier 1 capital divided by risk-weighted assets. |
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(17) |
Tier 1 risk-based capital ratio is a regulatory capital measure calculated based on Tier 1 capital divided by risk-weighted assets. |
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(18) |
Total risk-based capital ratio is a regulatory capital measure calculated based on Total risk-based capital divided by risk-weighted assets. |
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(19) |
Leverage capital ratio is a regulatory capital measure calculated based on Tier 1 capital divided by average assets, after certain adjustments. |
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(20) |
Amounts based on transition provisions for regulatory capital deductions and adjustments of 80% for 2017 and 60% for 2016. |
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14 |
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