Restricted Cash

12 Months Ended

Dec. 31, 2020

Restricted Cash [Abstract]

Restricted Cash

NOTE 3 – RESTRICTED CASH

The following table includes the composition of Oriental’s restricted cash:

	December 31,
	2020		2019
	(In thousands)
Cash pledged as collateral to other financial institutions to secure:
Regulatory requirements	$	325	$	400
Obligations under agreement of loans sold with recourse		1,050		1,050
	$	1,375	$	1,450

At December 31, 2020 and 2019, the Bank’s international banking entities held short-term highly liquid securities in the amount of $305 thousand and $325 thousand, respectively, as the legal reserve required for international banking entities under Puerto Rico law. In addition, as part of the Scotiabank PR & USVI acquisition on December 31, 2019, a certificate of deposit of $300 thousand was held for the acquired international banking entity that was retained as part of the integration. As of December 31, 2020, the entity held $325 thousand in cash. These instruments cannot be withdrawn or transferred without the prior written approval of the OCFI.

As part of regulatory requirements for the administration of individual retirement accounts (“IRAs”), SBPR maintained $100 thousand on a certificate of deposit that was retained as part of the integration on December 31, 2019. This certificate matured and was not renewed.

Oriental has a contract with FNMA which requires collateral to guarantee the repurchase, if necessary, of loans sold with recourse. At both, December 31, 2020 and 2019, Oriental delivered as collateral cash amounting to approximately $1.1 million.

The Bank is required by Puerto Rico law to maintain average weekly reserve balances to cover demand deposits. The amount of those minimum average reserve balances for the week that covered December 31, 2020 was $408.5 million (December 31, 2019 - $289.3 million). At December 31, 2020 and 2019, the Bank complied with this requirement. Cash and due from bank as well as other short-term, highly liquid securities, are used to cover the required average reserve balances.