XML 39 R29.htm IDEA: XBRL DOCUMENT v3.22.2
SEGMENT INFORMATION
 6 Months Ended
Jun. 30, 2022
Segment Reporting [Abstract]  
SEGMENT INFORMATION [Text Block]

NOTE 21 – SEGMENT INFORMATION

 

Based upon the Corporation’s organizational structure and the information provided to the Chief Executive Officer, the operating segments are based primarily on the Corporation’s lines of business for its operations in Puerto Rico, the Corporation’s principal market, and by geographic areas for its operations outside of Puerto Rico. As of June 30, 2022, the Corporation had six reportable segments: Commercial and Corporate Banking; Mortgage Banking; Consumer (Retail) Banking; Treasury and Investments; United States Operations; and Virgin Islands Operations. Management determined the reportable segments based on the internal structure used to evaluate performance and to assess where to allocate resources. Other factors, such as the Corporation’s organizational chart, nature of the products, distribution channels, and the economic characteristics of the products, were also considered in the determination of the reportable segments.

 

The Commercial and Corporate Banking segment consists of the Corporation’s lending and other services for large customers represented by specialized and middle-market clients and the public sector. The Commercial and Corporate Banking segment offers commercial loans, including commercial real estate and construction loans, and floor plan financings, as well as other products, such as cash management and business management services. The Mortgage Banking segment consists of the origination, sale, and servicing of a variety of residential mortgage loans. The Mortgage Banking segment also acquires and sells mortgages in the secondary markets. In addition, the Mortgage Banking segment includes mortgage loans purchased from other local banks and mortgage bankers. The Consumer (Retail) Banking segment consists of the Corporation’s consumer lending and deposit-taking activities conducted mainly through its branch network and loan centers. The Treasury and Investments segment is responsible for the Corporation’s investment portfolio and treasury functions that are executed to manage and enhance liquidity. This segment lends funds to the Commercial and Corporate Banking, Mortgage Banking, Consumer (Retail) Banking and United States Operations segments to finance their lending activities and borrows from those segments. The Consumer (Retail) Banking segment also lends funds to other segments. The interest rates charged or credited by the Treasury and Investments and the Consumer (Retail) Banking segments are allocated based on market rates. The difference between the allocated interest income or expense and the Corporation’s actual net interest income from centralized management of funding costs is reported in the Treasury and Investments segment. The United States Operations segment consists of all banking activities conducted by FirstBank in the United States mainland, including commercial and consumer banking services. The Virgin Islands Operations segment consists of all banking activities conducted by the Corporation in the USVI and BVI, including commercial and consumer banking services.

 

The accounting policies of the segments are the same as those referred to in Note 1 – Nature of Business and Summary of Significant Accounting Policies, in the audited consolidated financial statements, which are included in the 2021 Annual Report on Form 10-K.

 

The Corporation evaluates the performance of the segments based on net interest income, the provision for credit losses, non-interest income and direct non-interest expenses. The segments are also evaluated based on the average volume of their interest-earning assets less the ACL.

 

 

The following tables present information about the reportable segments for the indicated periods:

(In thousands)

Mortgage Banking

 

Consumer (Retail) Banking

 

Commercial and Corporate Banking

 

Treasury and Investments

 

United States Operations

 

Virgin Islands Operations

 

Total

For the Quarter Ended June 30, 2022:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

$

33,205

 

$

73,487

 

$

47,513

 

$

27,143

 

$

21,081

 

$

6,196

 

$

208,625

Net (charge) credit for transfer of funds

 

(6,870)

 

 

34,039

 

 

(16,134)

 

 

(10,705)

 

 

(330)

 

 

-

 

 

-

Interest expense

 

-

 

 

(5,129)

 

 

-

 

 

(4,972)

 

 

(2,063)

 

 

(275)

 

 

(12,439)

Net interest income

 

26,335

 

 

102,397

 

 

31,379

 

 

11,466

 

 

18,688

 

 

5,921

 

 

196,186

Provision for credit losses - (benefit) expense

 

(3,605)

 

 

15,055

 

 

(470)

 

 

(35)

 

 

(1,678)

 

 

736

 

 

10,003

Non-interest income (loss)

 

4,167

 

 

19,783

 

 

4,448

 

 

(51)

 

 

678

 

 

1,916

 

 

30,941

Direct non-interest expenses

 

5,681

 

 

40,546

 

 

9,048

 

 

905

 

 

8,237

 

 

6,765

 

 

71,182

 

Segment income

$

28,426

 

$

66,579

 

$

27,249

 

$

10,545

 

$

12,807

 

$

336

 

$

145,942

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average earnings assets

$

2,243,188

 

$

2,860,086

 

$

3,624,176

 

$

7,769,754

 

$

2,036,108

 

$

370,590

 

$

18,903,902

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

Mortgage Banking

 

Consumer (Retail) Banking

 

Commercial and Corporate Banking

 

Treasury and Investments

 

United States Operations

 

Virgin Islands Operations

 

Total

For the Quarter Ended June 30, 2021:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

$

36,945

 

$

66,237

 

$

53,833

 

$

16,708

 

$

20,651

 

$

7,085

 

$

201,459

Net (charge) credit for transfer of funds

 

(10,614)

 

 

5,901

 

 

(2,335)

 

 

8,191

 

 

(1,143)

 

 

-

 

 

-

Interest expense

 

-

 

 

(7,387)

 

 

-

 

 

(5,860)

 

 

(3,102)

 

 

(327)

 

 

(16,676)

Net interest income

 

26,331

 

 

64,751

 

 

51,498

 

 

19,039

 

 

16,406

 

 

6,758

 

 

184,783

Provision for credit losses expense - expense (benefit)

 

1,030

 

 

791

 

 

(27,752)

 

 

-

 

 

860

 

 

(1,084)

 

 

(26,155)

Non-interest income

 

6,137

 

 

16,726

 

 

4,139

 

 

85

 

 

1,068

 

 

1,729

 

 

29,884

Direct non-interest expenses

 

7,525

 

 

43,255

 

 

8,298

 

 

1,127

 

 

9,103

 

 

7,301

 

 

76,609

 

Segment income

$

23,913

 

$

37,431

 

$

75,091

 

$

17,997

 

$

7,511

 

$

2,270

 

$

164,213

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average earnings assets

$

2,563,768

 

$

2,491,583

 

$

3,888,725

 

$

7,588,530

 

$

2,103,002

 

$

438,928

 

$

19,074,536

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

Mortgage Banking

 

Consumer (Retail) Banking

 

Commercial and Corporate Banking

 

Treasury and Investments

 

United States Operations

 

Virgin Islands Operations

 

Total

Six-Month Period Ended June 30, 2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

$

66,276

 

$

143,924

 

$

94,540

 

$

49,327

 

$

39,938

 

$

12,474

 

$

406,479

Net (charge) credit for transfer of funds

 

(14,162)

 

 

58,321

 

 

(22,746)

 

 

(20,654)

 

 

(759)

 

 

-

 

 

-

Interest expense

 

-

 

 

(10,302)

 

 

-

 

 

(9,798)

 

 

(4,009)

 

 

(560)

 

 

(24,669)

Net interest income

 

52,114

 

 

191,943

 

 

71,794

 

 

18,875

 

 

35,170

 

 

11,914

 

 

381,810

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for credit losses - (benefit) expense

 

(7,308)

 

 

26,199

 

 

(17,092)

 

 

(423)

 

 

(5,225)

 

 

50

 

 

(3,799)

Non-interest income (loss)

 

9,419

 

 

40,246

 

 

9,002

 

 

(163)

 

 

1,422

 

 

3,873

 

 

63,799

Direct non-interest expenses

 

12,587

 

 

79,817

 

 

17,907

 

 

1,790

 

 

16,716

 

 

13,738

 

 

142,555

 

Segment income

$

56,254

 

$

126,173

 

$

79,981

 

$

17,345

 

$

25,101

 

$

1,999

 

$

306,853

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average earnings assets

$

2,268,279

 

$

2,810,062

 

$

3,662,720

 

$

7,931,699

 

$

2,050,791

 

$

374,358

 

$

19,097,909

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

Mortgage Banking

 

Consumer (Retail) Banking

 

Commercial and Corporate Banking

 

Treasury and Investments

 

United States Operations

 

Virgin Islands Operations

 

Total

Six-Month Period Ended June 30, 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

$

74,005

 

$

131,970

 

$

105,291

 

$

29,470

 

$

40,983

 

$

14,382

 

$

396,101

Net (charge) credit for transfer of funds

 

(22,434)

 

 

6,956

 

 

(4,812)

 

 

23,125

 

 

(2,835)

 

 

-

 

 

-

Interest expense

 

-

 

 

(15,692)

 

 

-

 

 

(11,973)

 

 

(6,719)

 

 

(669)

 

 

(35,053)

Net interest income

 

51,571

 

 

123,234

 

 

100,479

 

 

40,622

 

 

31,429

 

 

13,713

 

 

361,048

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for credit losses - expense (benefit)

 

244

 

 

4,753

 

 

(44,931)

 

 

(127)

 

 

623

 

 

(1,969)

 

 

(41,407)

Non-interest income

 

13,253

 

 

33,969

 

 

8,036

 

 

141

 

 

2,043

 

 

3,398

 

 

60,840

Direct non-interest expenses

 

15,522

 

 

84,346

 

 

19,836

 

 

2,361

 

 

17,397

 

 

14,706

 

 

154,168

 

Segment income

$

49,058

 

$

68,104

 

$

133,610

 

$

38,529

 

$

15,452

 

$

4,374

 

$

309,127

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average earnings assets

$

2,611,065

 

$

2,467,015

 

$

3,957,859

 

$

6,921,007

 

$

2,090,898

 

$

444,201

 

$

18,492,045

The following table presents a reconciliation of the reportable segment financial information to the consolidated totals for the indicated periods:

 

 

 

Quarter Ended

 

Six-Month Period Ended

 

 

 

June 30,

 

June 30,

 

 

 

2022

 

2021

 

2022

 

2021

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

Net income:

 

 

 

 

 

 

 

 

 

 

 

 

Total income for segments

$

145,942

 

$

164,213

 

$

306,853

 

$

309,127

 

Other operating expenses (1)

 

37,144

 

 

53,563

 

 

72,430

 

 

109,305

 

Income before income taxes

 

108,798

 

 

110,650

 

 

234,423

 

 

199,822

 

Income tax expense

 

34,103

 

 

40,092

 

 

77,128

 

 

68,114

 

 

Total consolidated net income

$

74,695

 

$

70,558

 

$

157,295

 

$

131,708

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average assets:

 

 

 

 

 

 

 

 

 

 

 

 

Total average earning assets for segments

$

18,903,902

 

$

19,074,536

 

$

19,097,909

 

$

18,492,045

 

Average non-earning assets

 

820,924

 

 

1,109,941

 

 

890,043

 

 

1,146,337

 

 

Total consolidated average assets

$

19,724,826

 

$

20,184,477

 

$

19,987,952

 

$

19,638,382

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Expenses pertaining to corporate administrative functions that support the operating segment, but are not specifically attributable to or managed by any segment, are not included in the reported financial results of the operating segments. The unallocated corporate expenses include certain general and administrative expenses and related depreciation and amortization expenses.