8-K

UNITED STATESSECURITIES 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):July 29, 2015

First BanCorp.
(Exact Name of Registrant as Specified in its Charter)

Puerto Rico	001-14793	66-0561822
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

1519 Ponce de Leon Ave. P.O. Box 9146 San Juan, Puerto Rico	00908-0146
(Address of Principal Executive Offices)	(Zip Code)

(787) 729-8200(Registrant’s Telephone Number, including Area Code)

Not applicable(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:

⃞ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

⃞ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

⃞ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

⃞ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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Item 2.02 Results of Operations and Financial Condition.

On July 29, 2015, First BanCorp. (the “Corporation”), the bank holding company for FirstBank Puerto Rico (“FirstBank” or “the Bank”), issued a press release announcing its unaudited results of operations for the second quarter ended June 30, 2015. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

A copy of the presentation that the Corporation will use at its conference call to discuss its financial results for the second quarter ended June 30, 2015 is attached hereto as Exhibit 99.2 and is incorporated herein by reference. As announced in a press release dated July 20, 2015, the call may be accessed via a live Internet webcast at 10:00 a.m. Eastern time on Thursday, July 30, 2015 through the investor relations section of the Corporation’s website: www.1firstbank.com or through the dial-in telephone number (877) 506-6537 or (412) 380-2001 for international callers. The conference number is 10069784.

The Corporation has included in this release the following financial measures that are not recognized under generally accepted accounting principles, which are referred to as non-GAAP financial measures: (i) the calculation of net interest income, interest rate spread and net interest margin rate on a tax-equivalent basis and excluding changes in the fair value of derivative instruments; (ii) the calculation of the tangible common equity ratio and the tangible book value per common share; (iii) the adjusted pre-tax, pre-provision income, and (iv) certain other financial measures, including net charge-offs, net charge-offs to average loans ratio, provision for loan and lease losses, provision for loan and lease losses to net charge-offs ratio, non-interest income, non-interest expenses and pre-tax income adjusted to exclude the effect of the bulk sale of assets completed in the second quarter of 2015, the other-than-temporary impairment on Puerto Rico Government debt securities recorded in the second quarter of 2015, the bargain purchase gain on assets acquired and liabilities assumed from Doral Bank (the “Doral Bank transaction”) in the first quarter of 2015 and acquisition and conversion costs related to the Doral Bank transaction recorded in the first and second quarter of 2015. Investors should be aware that non-GAAP financial measures have inherent limitations and should be read only in conjunction with the Corporation’s consolidated financial data prepared in accordance with GAAP.  

Management believes that these non-GAAP measures enhance the ability of analysts and investors to analyze trends in the Corporation’s business and to better understand the performance of the Corporation. In addition, the Corporation may utilize these non-GAAP financial measures as a guide in its budgeting and long-term planning process. Any analysis of these non-GAAP financial measures should be used only in conjunction with results presented in accordance with GAAP.

The release includes a reconciliation of these non-GAAP financial measures to the GAAP financial measures, except for the ratio of the provision for loan and lease losses to net charge-offs adjusted to exclude the effect of the bulk sale of assets for the quarter and six-month period ended June 30, 2015 included below:

	Provision for loan and lease losses to Net Charge-Offs (Non- GAAP to GAAP reconciliation)					Provision for loan and lease losses to Net Charge- Offs (Non-GAAP to GAAP reconciliation)
	Quarter Ended June 30, 2015					Six-Month Period Ended June 30, 2015
(In thousands)	Provision for Loan and Lease Losses			Net Charge-Offs		Provision for Loan and Lease Losses			Net Charge-Offs
Provision for loan and lease losses and net charge-offs, excluding special items (Non-GAAP)	$	27,319		$	17,377	$	60,289		$	46,678
Special items:
Bulk sale of assets		46,947			61,435		46,947			61,435
Provision for loan and lease losses and net charge-offs (GAAP)	$	74,266		$	78,812	$	107,236		$	108,113
Provision for loan and lease losses to net charge-offs, excluding special items (Non-GAAP)		157.21	%				129.16	%
Provision for loan and lease losses to net charge-offs (GAAP)		94.23	%				99.19	%

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Item 9.01.   Financial Statements and Exhibits.

            (d)           Exhibits

Exhibit Description of Exhibit

99.1	Press Release dated July 29, 2015 - First BanCorp. Announces Results for the Quarter Ended June 30, 2015
99.2	First BanCorp. Conference Call Presentation – Financial Results for the Quarter Ended June 30, 2015
	Exhibits 99.1 and 99.2 referenced therein, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall Exhibits 99.1 and 99.2 be deemed incorporated by reference in any filings under the Securities Act of 1933, as amended.

3

SIGNATURE

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

Date:	July 30, 2015	First BanCorp.
		By:	/s/ Orlando Berges
		Name:	Orlando Berges
		Title:	EVP and Chief Financial Officer

4

Exhibit Index

Exhibit	Description of Exhibit
99.1	Press Release dated July 29, 2015 - First BanCorp. Announces Results for the Quarter Ended June 30, 2015
99.2	First BanCorp. Conference Call Presentation – Financial Results for the Quarter Ended June 30, 2015

5

EX-99.1

Exhibit 99.1

First BanCorp. Announces Results for the Quarter Ended June 30, 2015

2015 Second Quarter Highlights and Comparison with First Quarter

• Net loss of $34.1 million, or $0.16 per diluted share, compared to net income of $25.6 million, or $0.12 per diluted share, for the first quarter of 2015. The net loss for the second quarter includes:
  • A $48.7 million pre-tax loss on a bulk sale of assets, mostly comprised of non-performing and adversely classified commercial loans, including transaction expenses.
  • A $12.9 million other-than-temporary impairment on Puerto Rico Government securities.
  • Pre-tax costs of $2.6 million related to the conversion of loan and deposit accounts acquired from Doral Bank (“Doral”) to the First Bank systems completed in the second quarter.
• Adjusted pre-tax income of $20.2 million, excluding the aforementioned items, compared to adjusted pre-tax income of $22.3 million for the first quarter of 2015. Adjusted pre-tax income for the first quarter of 2015 excludes a $13.4 million pre-tax bargain purchase gain on assets acquired and liabilities assumed from Doral and $2.1 million of pre-tax related acquisition and conversion costs.
• As previously announced, the Corporation completed the bulk sale of a commercial loan portfolio with a book value of $147.5 million (principal balance of $196.5 million), comprised mostly of non-performing and adversely classified loans, as well as other real estate owned (“OREO”) with a book value of $2.9 million, for $87.3 million in a cash transaction.
• Adjusted pre-tax, pre-provision income of $47.7 million, compared to $55.4 million for the first quarter of 2015.
• Net interest income increased by $0.8 million to $126.5 million and the net interest margin remained unchanged at 4.18%.

• Provision for loan and lease losses of $74.3 million, including a $46.9 million charge associated with the bulk sale of assets transaction, compared to $33.0 million for the first quarter of 2015.
• Adjusted non-interest income increased by $0.8 million to $20.1 million for the quarter, compared to $19.3 million for the first quarter of 2015. The improvement was primarily due to an increase in revenues from the mortgage banking business and the full quarter contribution of service charges on deposits and fees associated with deposits assumed from Doral in late February 2015.
• Adjusted non-interest expenses for the quarter increased by $9.4 million to $99.1 million compared to $89.6 million for the first quarter of 2015. The increase reflects, among other things, the full quarter impact of interim servicing costs and other recurring operating expenses related to Doral branches acquired, and an increase in OREO losses, employees’ compensation, and professional service fees.
• Income tax benefit of $9.8 million, compared to income tax expense of $8.0 million for the first quarter of 2015.
• Credit quality variances:
  • Non-performing assets decreased in the quarter by $109.9 million, or 15%, to $644.4 million, primarily attributable to the bulk sale of assets that included $91.9 million of non-performing commercial and construction loans and $2.9 million of OREO. Excluding the impact of the bulk sale, non-performing assets decreased by $15.2 million.
  • New non-performing loan inflows amounted to $44.9 million, or a 62% decrease, compared to inflows of $118.7 million in the first quarter of 2015 that included the migration of the $75.0 million credit facility with the Puerto Rico Electric Power Authority (“PREPA”).

• Total capital, common equity Tier 1 capital, Tier 1 capital, and leverage ratios calculated under the transition provisions of Basel III rules of 19.44%, 16.37%, 16.37%, and 11.94%, respectively, as of June 30, 2015. Tangible common equity ratio of 12.61% as of June 30, 2015.
• Total deposits, excluding brokered certificates of deposits and government deposits, down $138.5 million to $6.7 billion as of June 30, 2015, a decrease primarily reflected in the Florida region.
• Brokered certificates of deposit decreased in the quarter by $241.7 million to $2.3 billion as of June 30, 2015.
• Total loans decreased in the quarter by $269.4 million to $9.3 billion as of June 30, 2015. Commercial and construction loans decreased by $232.0 million, mainly due to the $147.5 million of loans included in the bulk sale of assets, and consumer loans decreased by $38.0 million.
• Total loan originations, including refinancings, renewals and draws from existing commitments (excluding credit card utilization activity), of $767.0 million for the second quarter of 2015, compared to $688.9 million for the first quarter of 2015, an increase primarily related to commercial loan originations in the Florida region and an increased volume of residential mortgage loan originations in both the Puerto Rico and Florida regions.
• As of June 30, 2015, the Corporation has $378.5 million of exposure to loans and obligations of the Commonwealth of Puerto Rico central government and instrumentalities, of which $204.3 million, or 53%, represents exposure to municipalities.

SAN JUAN, Puerto Rico--(BUSINESS WIRE)--July 29, 2015--First BanCorp. (the “Corporation”) (NYSE: FBP), the bank holding company for FirstBank Puerto Rico (“FirstBank” or “the Bank”), today reported a net loss of $34.1 million for the second quarter of 2015, or $0.16 per diluted share, compared to net income of $25.6 million, or $0.12 per diluted share, for the first quarter of 2015 and net income of $21.2 million, or $0.11 per diluted share, for the second quarter of 2014.

For the second quarter of 2015, the pre-tax loss was $43.9 million compared to pre-tax income of $33.7 million for the first quarter of 2015 and pre-tax income of $20.9 million for the second quarter of 2014. The pre-tax loss for the second quarter of 2015 includes:

• A $48.7 million pre-tax loss on a bulk sale of assets, mostly comprised of non-performing and adversely classified commercial loans, including transaction expenses.
• A $12.9 million other-than-temporary impairment on Puerto Rico Government securities.
• Pre-tax costs of $2.6 million related to the conversion of loan and deposit accounts acquired from Doral to the FirstBank systems completed in the second quarter.

Adjusted pre-tax income for the second quarter of 2015 was $20.2 million, excluding the aforementioned items, compared to adjusted pre-tax income of $22.3 million for the first quarter of 2015, excluding the $13.4 million pre-tax bargain purchase gain on assets acquired and liabilities assumed from Doral and the $2.1 million of pre-tax acquisition and conversion costs incurred in the first quarter.

Aurelio Alemán, President and Chief Executive Officer of First BanCorp., commented: “Throughout the quarter we updated the market on several important accomplishments: our consent order which had been in place with the FDIC for five years was lifted; and, we executed an accelerated de-risking transaction that improved our asset quality metrics to levels we have not seen since 2009. We also posted our results for the Dodd-Frank Act Stress Test which show that even in a severely adverse economic environment, which we are not currently in, our capital ratios exceed the well-capitalized thresholds throughout the nine-quarter horizon. In addition, during the quarter we successfully completed the integration and rebranding of the acquired Doral branches and mortgage portfolio.

We posted a net loss for the quarter of $34.1 million due largely to the bulk sale transaction. Our profitability was also impacted this quarter by an OTTI charge of $12.9 million that we took on our government securities. Our deposit base remains stable and our cost of deposits are at their lowest level in recent years, our loan originations improved and delinquencies are stable across all of our portfolios.

The Puerto Rico economic situation continues to face hurdles, we know how to operate in an adverse economy and have been doing so for years. We are prepared to manage through more challenging economic conditions and as our stress tests reflect we have the capital strength and market position to not only do so but to take advantage of opportunities that also appear in challenging times. The reality is that the franchise has never been stronger and poised to increase shareholder value. We encourage our government officials to work together with the private industry and provide more clarity to the market in order to remove uncertainty and avoid further economic deterioration.

That said, we have a plan and we are well-prepared to execute. The successful integration of our recent acquisition and de-risking will drive bottom line results in the quarters to come.”

This press release includes certain non-GAAP financial measures, including adjusted pre-tax income, adjusted non-interest income, adjusted non-interest expenses, adjusted pre-tax, pre-provision income, adjusted net interest income and margin, certain capital ratios, and certain other financial measures that exclude the effect of the bulk sale of assets, the other-than-temporary impairment on Puerto Rico Government debt securities, and the bargain purchase gain and acquisition and conversion costs related to the Doral transaction, and should be read in conjunction with the accompanying tables (Exhibit A), which are an integral part of this press release.

RECENT EVENTS

Bulk Sale of Assets

As previously announced, during the second quarter of 2015 the Corporation completed the sale of commercial and construction loans with a book value of $147.5 million (principal balance of $196.5 million), comprised mostly of non-performing and adversely classified loans, as well as OREO with a book value of $2.9 million, in a cash transaction. The sale price of this bulk sale was $87.3 million. Approximately $15.3 million of reserves had been allocated to the loans. This transaction resulted in total charge-offs of $61.4 million and an incremental pre-tax loss of $48.7 million, including $0.9 million in professional service fees directly attributable to the bulk sale.

The inclusion of the $61.4 million of charge-offs from the bulk sale in the historical loss rates had an impact of approximately $15.5 million on the general reserve for loan losses determined for loans collectively evaluated for impairment.

Doral Bank Transaction

During the second quarter of 2015, the Corporation successfully completed the system conversion of loan and deposit accounts acquired from Doral to the FirstBank systems and recorded approximately $2.6 million of pre-tax conversion costs in the second quarter compared to $2.1 million in the first quarter of 2015. In addition, the Corporation incurred approximately $2.4 million in interim servicing costs in the second quarter compared to $1.2 million in the first quarter of 2015. As previously reported, the Corporation recorded in the first quarter of 2015 a $13.4 million pre-tax bargain purchase gain in connection with assets acquired and liabilities assumed from Doral.

Other-Than-Temporary Impairment on Puerto Rico Government Obligations

During the second quarter of 2015, the Corporation recorded a $12.9 million other-than-temporary impairment (“OTTI”) on three Puerto Rico Government debt securities held by the Corporation as part of its available for sale securities portfolio, specifically bonds of the Government Development Bank for Puerto Rico and the Puerto Rico Public Buildings Authority. The credit-related impairment loss estimate is based on the probability of default and loss severity in the event of default in consideration of the debt securities credit ratings and the latest available information about the Puerto Rico Government’s financial condition, including the Puerto Rico Government’s intentions to restructure its outstanding bond obligations. Given the significant uncertainty of a debt restructuring process, the Corporation cannot be certain that future impairment charges will not be required on these securities. As of June 30, 2015, the Corporation owns Puerto Rico Government debt securities in the aggregate amount of $52.7 million (net of the $12.9 million OTTI), carried on its books at a fair value of $34.6 million.

The following table shows a reconciliation of certain non-GAAP financial measures (“adjusted net charge-offs,” “adjusted provision for loan and lease losses,” “adjusted non-interest income,” “adjusted non-interest expenses,” and “adjusted pre-tax income”), which reflect the exclusion of the realized loss on the bulk sale of assets, the OTTI charge on Puerto Rico Government debt securities, system conversion costs related to the Doral transaction and the bargain purchase gain, to the corresponding measures calculated and presented in accordance with GAAP.

NON-GAAP RECONCILIATION

(Dollars in thousands)
Second Quarter of 2015	As Reported (GAAP)			Bulk Sale Transaction Impact			Acquisition and Conversion Costs		OTTI on Puerto Rico Government Debt Securities		Excluding Bulk Sale Transaction, acquisition and conversion costs and OTTI on Puerto Rico Government Debt Securities (Non-GAAP)
Total net charge-offs (1)	$	78,812		$	61,435		$	-	$	-	$	17,377
Total net charge-offs to average loans		3.35	%									0.75	%
Commercial mortgage		41,665			37,590			-		-		4,075
Commercial mortgage loans net charge-offs to average loans		10.37	%									1.06	%
Commercial and Industrial		20,417			20,570			-		-		(153	)
Commercial and Industrial loans net charge-offs (recoveries) to average loans		3.41	%									-0.03	%
Construction		2,083			3,275			-		-		(1,192	)
Construction loans net charge-offs (recoveries) to average loans		4.90	%									-2.94	%
Provision for loan and lease losses	$	74,266		$	46,947		$	-	$	-	$	27,319
Non-interest income	$	6,670		$	552		$	-	$	12,856	$	20,078
Net (loss) gain on investments and impairments		(13,097	)		-			-		12,856		(241	)
Other non-interest income		9,785			552			-		-		10,337
Non-interest expenses	$	102,799		$	1,168		$	2,562	$	-	$	99,069
Employees' compensation and benefits		37,945						104		-		37,841
Professional fees		19,005			918			1,983		-		16,104
Business promotion		3,934			-			274		-		3,660
Net loss on OREO operations		4,874			250			-		-		4,624
Other expenses		12,055			-			201		-		11,854
Pre-tax (loss) income	$	(43,918	)	$	48,667		$	2,562	$	12,856	$	20,167
(1) Charge-offs percentages annualized.
(Dollars in thousands)
First Quarter of 2015	As Reported (GAAP)			Bargain Purchase Gain			Acquisition and Conversion Costs		OTTI on Puerto Rico Government Debt Securities		Excluding Bargain Purchase Gain and acquisition and conversion costs (Non-GAAP)
Non-interest income	$	32,729		$	(13,443	)	$	-	$	-	$	19,286
Bargain Purchase Gain		13,443			(13,443	)		-		-		-
Non-interest expenses	$	91,728		$	-		$	2,084	$	-	$	89,644
Occupancy and equipment		14,349			-			118		-		14,231
Professional fees		15,218			-			1,726		-		13,492
Business promotion		2,868			-			163		-		2,705
Other expenses		11,150			-			77		-		11,073
Pre-tax income	$	33,678		$	(13,443	)	$	2,084	$	-	$	22,319

ADJUSTED PRE-TAX, PRE-PROVISION INCOME TRENDS

Adjusted pre-tax, pre-provision income is a non-GAAP financial measure that management believes is useful in analyzing performance. This metric is earnings adjusted to exclude tax expense, the provision for loan and lease losses, securities gains or losses and impairments, fair value adjustments on derivatives and equity in earnings or loss of unconsolidated entity up until the second quarter of 2014 when the value of the investment became zero. In addition, from time to time, earnings are adjusted also for items judged by management to be outside of ordinary banking activities and/or for items that, while they may be associated with ordinary banking activities, are so unusually large that management believes that a complete analysis of the Corporation’s performance requires consideration also of results that exclude such amounts (for additional information about this non-GAAP financial measure, see “Adjusted Pre-Tax, Pre-Provision Income” in “Basis of Presentation”).

The following table reconciles income before income taxes to adjusted pre-tax, pre-provision income for the last five quarters including adjusted pre-tax, pre-provision income of $47.7 million in the second quarter of 2015, down $7.7 million from the prior quarter:

(Dollars in thousands)	Quarter Ended
	June 30,			March 31,			December 31,			September 30,			June 30,
	2015			2015			2014			2014			2014
(Loss) income before income taxes	$	(43,918	)	$	33,678		$	29,454		$	23,265		$	20,949
Add: Provision for loan and lease losses		74,266			32,970			23,872			26,999			26,744
Add/Less: Net loss (gain) on investments and impairments		13,097			156			172			245			(291	)
Less: Unrealized gain on derivative instruments		-			-			(265	)		(418	)		(262	)
Less: Prepayment penalty collected on a commercial mortgage loan		-			-			(2,546	)		-			-
Less: Bargain purchase gain on assets acquired/deposits assumed from Doral		-			(13,443	)		-			-			-
Add: Non-recurring expenses for acquisition of loans/assumption of deposits from Doral		2,562			2,084			-			659			576
Add: Loss on a commercial mortgage loan held for sale and certain OREOs included in the bulk sale of assets		802			-			-			-			-
Add: Bulk sale of assets related expenses		918			-			-			-			-
Add: Branch consolidations and restructuring expenses		-			-			-			-			236
Add/Less: Equity in loss of unconsolidated entity		-			-			-			-			670
Adjusted pre-tax, pre-provision income (1)	$	47,727		$	55,445		$	50,687		$	50,750		$	48,622
Change from most recent prior quarter-amount	$	(7,718	)	$	4,758		$	(63	)	$	2,128		$	(8,278	)
Change from most recent prior quarter-percentage		-13.9	%		9.4	%		-0.1	%		4.4	%		-14.5	%
(1) See "Basis of Presentation" for definition.

The decrease in adjusted pre-tax, pre-provision income from the 2015 first quarter primarily reflected:

• A $9.4 million increase in adjusted non-interest expenses of $99.1 million for the second quarter of 2015, as compared to $89.6 million for the first quarter of 2015, primarily reflecting the impact of interim servicing costs and other recurring operating expenses related to the acquired Doral branches, and an increase in OREO losses, employees’ compensation, and professional service fees expenses. See Non-Interest Expenses section below for additional information.

Adjusted non-interest expenses exclude certain costs that were considered non-recurring such as expenses and losses directly attributable to the bulk sale of assets in the second quarter of 2015 and acquisition and conversion costs related to the Doral transaction. See Recent Events-Non-GAAP Reconciliation section above for a reconciliation of this non-GAAP financial measure to the corresponding GAAP measure.

Partially offset by:

• A $0.8 million increase in adjusted non-interest income of $20.1 million for the second quarter of 2015, as compared to $19.3 million for the first quarter of 2015, mainly due to an increase in revenues from the mortgage banking business and the full quarter contribution of service charges on deposits and fees associated with deposits assumed from Doral. See Non-Interest Income section below for additional information.

Adjusted non-interest income excludes the loss on a commercial mortgage loan held for sale included in the bulk sale of assets completed in the second quarter of 2015, the bargain purchase gain on assets acquired and deposits assumed from Doral in the first quarter of 2015 and the OTTI charge on Puerto Rico Government debt securities. See Recent Events-Non-GAAP Reconciliation section above for a reconciliation of this non-GAAP financial measure to the corresponding GAAP measure.

• A $0.8 million increase in net interest income primarily reflecting the full quarter contribution of the residential mortgage loan portfolio acquired from Doral in late February 2015 and a decrease in interest expense achieved through the reduction in the average balance of brokered CDs and the benefit from the offsetting accounting for a reverse repurchase agreement entered into in the second quarter, partially offset by a higher premium amortization expense on U.S. agency mortgage-backed securities (“MBS”) and the decrease in interest income earned on the commercial and consumer loan portfolios. See Net Interest Income discussion below for additional information.

NET INTEREST INCOME

The following table reconciles net interest income in accordance with GAAP to net interest income excluding fair value adjustments (unrealized gains in the table) on derivatives (“valuations”) and the $2.5 million prepayment penalty collected on a commercial mortgage loan paid off in the fourth quarter of 2014, and net interest income on a tax-equivalent basis. Net interest income, excluding valuations and the aforementioned $2.5 million prepayment penalty, and net interest income on a tax-equivalent basis are non-GAAP measures. (See “Basis of Presentation – Net Interest Income, Excluding Valuations and Prepayment Penalty, and on a Tax-Equivalent Basis” below for additional information.) The table also reconciles net interest spread and net interest margin on a GAAP basis to these items excluding valuations and the prepayment penalty, and on a tax-equivalent basis.

(Dollars in thousands)
	Quarter Ended
	June 30, 2015			March 31, 2015			December 31, 2014			September 30, 2014			June 30, 2014
Net Interest Income
Interest income - GAAP	$	151,632		$	152,485		$	158,293		$	156,662		$	158,423
Unrealized gain on
derivative instruments		-			-			(265	)		(418	)		(262	)
Interest income excluding valuations		151,632			152,485			158,028			156,244			158,161
Prepayment penalty on a commercial mortgage loan tied to an interest rate swap		-			-			(2,546	)		-			-
Interest income excluding valuations and a $2.5 million prepayment penalty collected		151,632			152,485			155,482			156,244			158,161
Tax-equivalent adjustment		4,623			4,005			3,968			3,995			5,005
Prepayment penalty collected on a commercial mortgage loan		-			-			2,546			-			-
Interest income on a tax-equivalent basis excluding valuations		156,255			156,490			161,996			160,239			163,166
Interest expense - GAAP		25,155			26,838			29,141			28,968			28,516
Net interest income - GAAP	$	126,477		$	125,647		$	129,152		$	127,694		$	129,907
Net interest income excluding valuations and a $2.5 million prepayment penalty collected	$	126,477		$	125,647		$	126,341		$	127,276		$	129,645
Net interest income on a tax-equivalent basis excluding valuations	$	131,100		$	129,652		$	132,855		$	131,271		$	134,650
Average Balances
Loans and leases	$	9,409,417		$	9,379,755		$	9,488,427		$	9,476,576		$	9,560,792
Total securities and other short-term investments		2,741,466			2,808,330			2,764,390			2,768,923			2,811,178
Average interest-earning assets	$	12,150,883		$	12,188,085		$	12,252,817		$	12,245,499		$	12,371,970
Average interest-bearing liabilities	$	9,768,667		$	10,042,209		$	10,186,134		$	10,245,634		$	10,395,437
Average Yield/Rate
Average yield on interest-earning assets - GAAP		5.01	%		5.07	%		5.13	%		5.08	%		5.14	%
Average rate on interest-bearing liabilities - GAAP		1.03	%		1.08	%		1.14	%		1.12	%		1.10	%
Net interest spread - GAAP		3.98	%		3.99	%		3.99	%		3.96	%		4.04	%
Net interest margin - GAAP		4.18	%		4.18	%		4.18	%		4.14	%		4.21	%
Average yield on interest-earning assets excluding valuations and a $2.5 million prepayment penalty		5.01	%		5.07	%		5.03	%		5.06	%		5.13	%
Average rate on interest-bearing liabilities excluding valuations		1.03	%		1.08	%		1.14	%		1.12	%		1.10	%
Net interest spread excluding valuations and a $2.5 million prepayment penalty collected		3.98	%		3.99	%		3.89	%		3.94	%		4.03	%
Net interest margin excluding valuations and a $2.5 million prepayment penalty collected		4.18	%		4.18	%		4.09	%		4.12	%		4.20	%
Average yield on interest-earning assets on a tax-equivalent basis and excluding valuations		5.16	%		5.21	%		5.25	%		5.19	%		5.29	%
Average rate on interest-bearing liabilities excluding valuations		1.03	%		1.08	%		1.14	%		1.12	%		1.10	%
Net interest spread on a tax-equivalent basis and excluding valuations		4.14	%		4.13	%		4.11	%		4.07	%		4.19	%
Net interest margin on a tax-equivalent basis and excluding valuations		4.33	%		4.31	%		4.30	%		4.25	%		4.37	%

Net interest income amounted to $126.5 million, an increase of $0.8 million when compared to the first quarter of 2015. The net interest margin remained unchanged at 4.18% for the second quarter of 2015 compared to the first quarter of 2015. The increase in net interest income was mainly due to:

• A $2.8 million increase in interest income on residential mortgage loans primarily reflecting the full quarter contribution of loans acquired from Doral in late February 2015. Interest income on this residential mortgage loan portfolio acquired from Doral amounted to $4.6 million in the second quarter of 2015 compared to $1.6 million in the first quarter of 2015, an increase of $3.0 million.
• A $1.7 million decrease in total interest expense primarily driven by: (i) a $1.0 million decrease in interest expense on repurchase agreements mainly reflecting the effect of the netting in accordance with GAAP of the $0.8 million interest income earned on a $200 million reverse repurchase agreement entered into in April 2015 as part of an agreement with an existing counterparty against interest expense on repurchase agreements with such counterparty, and the full quarter impact of the $400 million repurchase agreements restructured in the first quarter, and (ii) a $0.7 million decrease in interest expense on deposits (net of a $0.2 million increase associated with the full quarter impact of deposits acquired from Doral) mainly related to the $298.7 million decrease in the average balance of brokered CDs and lower rates paid on interest-bearing deposits.

Partially offset by:

• A $1.6 million decrease in interest income on U.S. agency MBS mainly due to a higher premium amortization expense as prepayment speeds accelerated during the second quarter.
• A $1.5 million decrease in interest income on commercial and construction loans adversely impacted by a decrease of $0.6 million related to interest income recorded in the first quarter on loans sold as part of the bulk sale and approximately $0.9 million in interest payments received in the second quarter from the PREPA credit facility accounted for on a cost recovery basis.
• A $0.8 million decrease in interest income on consumer loans driven by a $43.8 million decrease in the average volume of loans, primarily auto loans.

PROVISION FOR LOAN AND LEASE LOSSES

The provision for loan and lease losses for the second quarter of 2015 was $74.3 million, including the $46.9 million charge associated with the bulk sale transaction, compared to $33.0 million for the first quarter of 2015. Excluding the $46.9 million charge related to the bulk sale, the provision decreased by $5.7 million driven by the following variances:

• An $11.5 million decrease in the provision for consumer loans mainly due to lower historical loss rates that reflect, among other things, improvements in charge-off trends and declining loss severity rates on auto loans. Consumer loans net charge-offs decreased by $4.8 million in the second quarter, as compared to the first quarter of 2015, driven by loan loss recoveries of $2.7 million on the sale of certain auto and personal loans that had been fully charged-off in prior periods. The decrease in the provision also reflects the decline in the size of this portfolio.

Partially offset by:

• A $4.0 million increase in the provision for construction and commercial loans driven by a $15.5 million increase to the general reserves as a result of the incorporation of the $61.4 million of charge-offs from the bulk sale in the historical loss rates used to estimate inherent losses for non-impaired loans, partially offset by a decrease of approximately $8.0 million related to adjustments to general reserve factors applied to some asset classifications for improvements in loans’ migration experience and a $2.9 million increase in loan loss recoveries that was mainly associated with loans in the Florida region.

• A $1.9 million increase in the provision for residential mortgage loans driven by a reserve of $3.1 million established in the second quarter attributable to the purchased credit-impaired loans acquired from Doral in May 2014. The reserve is driven by a revision to the expected cash flows of the portfolio for the remaining term of the loan pool based on market conditions. This was partially offset by a $1.8 million decrease in residential mortgage loans net charge-offs.

See Credit Quality discussion below for additional information regarding the allowance for loan and lease losses, including variances in charge-offs and loss recoveries.

NON-INTEREST INCOME

		Quarter Ended
		June 30,			March 31,			December 31,			September 30,			June 30,
(In thousands)		2015			2015			2014			2014			2014
	Service charges on deposit accounts	$	5,219		$	4,555		$	4,155		$	4,205		$	4,222
	Mortgage banking activities		4,763			3,618			4,472			3,809			3,036
	Net (loss) gain on investments and impairments		(13,097	)		(156	)		(172	)		(245	)		291
	Other operating income		9,785			11,269			9,438			8,405			9,052
	Bargain purchase gain		-			13,443			-			-			-
	Equity in loss of unconsolidated entity		-			-			-			-			(670	)
	Non-interest income	$	6,670		$	32,729		$	17,893		$	16,174		$	15,931

Non-interest income for the second quarter of 2015 amounted to $6.7 million, compared to $32.7 million for the first quarter of 2015. Excluding the $12.9 million OTTI charge on Puerto Rico Government debt securities in the second quarter of 2015, the $0.6 million pre-tax loss on a commercial mortgage loan held for sale included in the bulk sale of assets in the second quarter of 2015 and the $13.4 million pre-tax bargain purchase gain on the assets acquired and liabilities assumed from Doral recorded in the first quarter of 2015, adjusted non-interest income increased by $0.8 million. The increase was primarily due to:

• A $1.1 million increase in revenues from the mortgage banking business driven by a higher volume of sales in the secondary market. Loans sold and securitized in the secondary market to U.S. government-sponsored entities amounted to $121.2 million with a related gain of $3.4 million in the second quarter of 2015, compared to $85.3 million with a related gain of $2.9 million in the first quarter of 2015. In addition, there was a $0.6 million increase in income from mortgage hedging activities related to gains/losses on to-be-announced (TBAs) MBS forward contracts.
• A $0.6 million increase in service charges on deposits and an increase of $0.3 million in other fees reflecting the full quarter contribution of deposits assumed from Doral late in February 2015.

Partially offset by:

• A $1.5 million decrease in income from insurance commissions, mainly reflecting seasonal contingent commissions received in the first quarter by the insurance agency based on the prior year’s production of insurance policies.

NON-INTEREST EXPENSES

		Quarter Ended
		June 30,		March 31,		December 31,		September 30,		June 30,
(In thousands)		2015		2015		2014		2014		2014
	Employees' compensation and benefits	$	37,841	$	35,654	$	33,854	$	33,877	$	34,793
	Occupancy and equipment		15,059		14,231		14,763		14,727		14,246
	Deposit insurance premium		5,405		5,770		6,682		8,335		9,579
	Other insurance and supervisory fees		1,391		1,090		1,182		1,158		1,205
	Taxes, other than income taxes		3,131		3,001		4,482		4,528		4,504
	Professional fees:
	Collections, appraisals and other credit related fees		3,777		3,432		4,244		2,914		2,717
	Outsourcing technology services		4,789		4,704		4,775		4,840		4,600
	Other professional fees		7,539		5,356		4,420		3,641		4,073
	Credit and debit card processing expenses		3,945		3,957		4,002		3,741		3,882
	Branch consolidations and restructuring expenses		-		-		-		-		236
	Business promotion		3,660		2,705		4,491		3,925		4,142
	Communications		2,045		1,608		1,851		2,143		1,894
	Net loss on OREO operations		4,624		2,628		3,655		4,326		6,778
	Loss on sale of certain OREOs included in the bulk sale		250		-		-		-		-
	Bulk sale of assets related expenses		918		-		-		-		-
	Acquisitions of loans/assumption of deposits from Doral non-recurring expenses		2,562		2,084		-		659		576
	Other		5,863		5,508		5,318		4,790		4,920
	Total	$	102,799	$	91,728	$	93,719	$	93,604	$	98,145

Non-interest expenses in the second quarter of 2015 amounted to $102.8 million, an increase of $11.1 million from $91.7 million for the first quarter of 2015. Excluding non-recurring acquisition and conversion costs related to the Doral transaction of $2.6 million and $2.1 million for the second quarter and first quarter of 2015, respectively, and $1.2 million of expenses and losses directly associated with the bulk sale transaction in the second quarter, non-interest expenses increased to $99.1 million for the second quarter of 2015 from $89.6 million in the first quarter. The main drivers of the increase were:

• A $2.6 million increase in adjusted professional service fees due to, among other things, a $1.2 million increase in interim servicing costs related to loans and deposits acquired from Doral, as the conversion to the FirstBank systems was completed two months into the second quarter. The Corporation incurred approximately $2.4 million in interim servicing costs in the second quarter compared to $1.2 million in the first quarter of 2015. Upon completion of the conversion, the ongoing costs related to the processing and maintenance of these accounts are lower. In addition, there was an increase of $1.3 million in consulting and legal expenses for special projects as well as strategic, stress testing and capital planning matters that are not expected to be incurred on an ongoing basis.
• A $2.2 million increase in adjusted employees’ compensation and benefit expenses mainly due to salary merit increases that became effective early in the second quarter that accounted for approximately $1.4 million of the increase, including $0.2 million of lump-sum payments, and the full quarter impact of personnel costs related to branches acquired from Doral that account for approximately $0.4 million of the increase. In addition, there was an increase of approximately $0.4 million for one additional business day in the second quarter, as compared to the first quarter of 2015.
• A $2.0 million increase in adjusted OREO losses driven by higher write-downs to commercial OREO properties. Write-downs on OREO properties amounted to $4.6 million in the second quarter of 2015, primarily related to one commercial property in Puerto Rico, compared to $3.0 million in the first quarter of 2015. In addition there was a $0.9 million decrease in realized gains at the time of disposition, as the previous quarter included a gain of $1.3 million on the sale of certain commercial OREO properties. These variances were partially offset by a $0.4 million increase in rental income on OREO properties.
• A $1.0 million increase in adjusted business promotion expenses, primarily attributable to the seasonality of marketing campaigns.
• A $0.8 million increase in adjusted occupancy and equipment costs primarily related to the full quarter impact of rental, depreciation and maintenance expenses associated with the acquired Doral branches that account for $0.6 million of the increase.
• A $0.8 million aggregate increase in communications and other operating expenses in the table above, including increases of $0.3 million in the core deposit intangible amortization and $0.3 million in communications, supplies, and processing expenses that reflect the full quarter impact of the acquired Doral branches.

See Recent Events-Non-GAAP Reconciliation section above for a reconciliation of the non-GAAP financial measures, adjusted professional service fees, adjusted employees’ compensation and benefit expenses, adjusted OREO losses, adjusted business promotion expenses and adjusted occupancy and equipment costs, to the corresponding GAAP measures.

INCOME TAXES

The Corporation recorded an income tax benefit for the second quarter of 2015 of $9.8 million compared to an income tax expense of $8.0 million for the first quarter of 2015. As of June 30, 2015, the Corporation had a net deferred tax asset of $310.4 million (net of a valuation allowance of $204.9 million, including a valuation allowance of $179.7 million against the deferred tax assets of the Corporation’s banking subsidiary, FirstBank).

CREDIT QUALITY
Non-Performing Assets

(Dollars in thousands)		June 30,			March 31,			December 31,			September 30,			June 30,
		2015			2015			2014			2014			2014
Non-performing loans held for investment:
	Residential mortgage	$	175,035		$	172,583		$	180,707		$	185,025		$	175,404
	Commercial mortgage		95,088			142,385			148,473			169,967			166,218
	Commercial and Industrial		143,935			186,500			122,547			130,917			143,669
	Construction		16,118			27,163			29,354			30,111			38,830
	Consumer and Finance leases		33,397			34,913			42,815			43,496			40,510
	Total non-performing loans held for investment		463,573			563,544			523,896			559,516			564,631
OREO			122,129			122,628			124,003			112,803			121,842
Other repossessed property			10,706			13,585			14,229			17,467			16,114
	Total non-performing assets, excluding loans held for sale	$	596,408		$	699,757		$	662,128		$	689,786		$	702,587
Non-performing loans held for sale			48,032			54,588			54,641			54,641			54,755
	Total non-performing assets, including loans held for sale (1)	$	644,440		$	754,345		$	716,769		$	744,427		$	757,342
Past-due loans 90 days and still accruing (2)		$	196,547		$	178,572		$	162,887		$	143,535		$	143,916
Non-performing loans held for investment to total loans held for investment			5.03	%		5.94	%		5.66	%		6.01	%		5.96	%
Non-performing loans to total loans			5.50	%		6.46	%		6.19	%		6.54	%		6.49	%
Non-performing assets, excluding non-performing loans held for sale, to total assets, excluding non-performing loans held for sale			4.76	%		5.34	%		5.22	%		5.48	%		5.63	%
Non-performing assets to total assets			5.12	%		5.74	%		5.63	%		5.89	%		6.05	%
(1)	Purchased credit impaired loans of $178.5 million accounted for under ASC 310-30 as of June 30, 2015, primarily mortgage loans acquired from Doral in the first quarter of 2015 and second quarter of 2014, are excluded and not considered non-performing due to the application of the accretion method, under which these loans will accrete interest income over the remaining life of the loans using estimated cash flow analysis.
(2)	Amount includes purchased credit impaired loans with individual delinquencies over 90 days and still accruing with a carrying value as of June 30, 2015 of approximately $18.2 million, primarily related to loans acquired from Doral in the first quarter of 2015 and second quarter of 2014.

Credit quality metrics variances:

• Total non-performing assets decreased by $109.9 million to $644.4 million as of June 30, 2015, compared to $754.3 million as of March 31, 2015. Total non-performing loans, including non-performing loans held for sale, decreased by $106.5 million, or 17%, from the first quarter of 2015. The decrease in non-performing assets was primarily attributable to the bulk sale of assets that included $91.9 million of non-performing commercial and construction loans and $2.9 million of OREO. Excluding the impact of the bulk sale, non-performing assets decreased by $15.2 million primarily due to certain commercial loans brought current, charge-offs and cash collections.
  

• Inflows to non-performing loans held for investment were $44.9 million, a decrease of $73.8 million, or 62%, compared to inflows of $118.7 million in the first quarter of 2015 that included the $75.0 million credit facility of PREPA. Excluding the aforementioned $75.0 million credit facility to PREPA, total inflows in the second quarter remained relatively flat compared to the first quarter of 2015.
• Adversely classified commercial and construction loans held for investment decreased by $93.3 million to $411.0 million, or 19% from the first quarter of 2015, driven by the bulk sale of assets that included $146.6 million of adversely classified loans, partially offset by the migration of approximately $44.4 million of syndicated commercial loan participations to adverse classification categories.
• The OREO balance decreased by $0.5 million, driven by sales of $9.1 million and valuation adjustments of $6.6 million, partially offset by additions of $15.2 million in the second quarter of 2015.
• Total Troubled Debt Restructurings (“TDRs”) held for investment were $634.8 million as of June 30, 2015, down $70.4 million, or 10% from March 31, 2015, driven by the bulk sale of assets that included $89.4 million of TDRs. Approximately $400.8 million of total TDRs held for investment were in accrual status as of June 30, 2015.

Allowance for Loan and Lease Losses

The following table sets forth an analysis of the allowance for loan and lease losses during the periods indicated:

	Quarter Ended
(Dollars in thousands)	June 30,				March 31,			December 31,			September 30,			June 30,
	2015				2015			2014			2014			2014
Allowance for loan and lease losses, beginning of period	$	226,064			$	222,395		$	225,434		$	241,177		$	266,778
Provision for loan and lease losses		74,266		(1)		32,970			23,872			26,999			26,744		(6)
Net (charge-offs) recoveries of loans:
Residential mortgage		(3,257	)			(5,094	)		(6,522	)		(5,734	)		(4,687	)
Commercial mortgage		(41,665	)	(2)		(3,730	)		(1,383	)		1,116			(9,126	)
Commercial and Industrial		(20,417	)	(3)		(3,895	)		(992	)		(16,431	)		(19,036	)	(7)
Construction		(2,083	)	(4)		(398	)		680			(3,205	)		(2,606	)
Consumer and finance leases		(11,390	)			(16,184	)		(18,694	)		(18,488	)		(16,890	)
Net charge-offs		(78,812	)	(5)		(29,301	)		(26,911	)		(42,742	)		(52,345	)	(7)
Allowance for loan and lease losses, end of period	$	221,518			$	226,064		$	222,395		$	225,434		$	241,177
Allowance for loan and lease losses to period end total loans held for investment		2.40	%			2.38	%		2.40	%		2.42	%		2.55	%
Net charge-offs (annualized) to average loans outstanding during the period		3.35	%			1.25	%		1.13	%		1.80	%		2.19	%
Net charge-offs (annualized), excluding charge-offs of $61.4 million related to the bulk sale of assets in the second quarter of 2015 and $6.9 million related to the acquisition of mortgage loans from Doral in the second quarter of 2014, to average loans outstanding during the period		0.75	%			1.25	%		1.13	%		1.80	%		1.90	%
Provision for loan and lease losses to net charge-offs during the period	0.94x				1.13x			0.89x			0.63x			0.51x
Provision for loan and lease losses to net charge-offs during the period, excluding impact of the bulk sale of assets in the second quarter of 2015 and the acquisition of mortgage loans from Doral in the second quarter of 2014	1.57x				1.13x			0.89x			0.63x			0.56x
(1) Includes provision of $46.9 million associated with the bulk sale of assets.
(2) Includes net charge-offs totaling $37.6 million associated with the bulk sale of assets.
(3) Includes net charge-offs totaling $20.6 million associated with the bulk sale of assets.
(4) Includes net charge-offs totaling $3.3 million associated with the bulk sale of assets.
(5) Includes net charge-offs totaling $61.4 million associated with the bulk sale of assets.
(6) Includes a provision of $1.4 million associated with the acquisition of mortgage loans from Doral.
(7) Includes net charge-offs totaling $6.9 million associated with the acquisition of mortgage loans from Doral.

• The ratio of the allowance for loan and lease losses to total loans held for investment was 2.40% as of June 30, 2015, a slight increase from the 2.38% as of March 31, 2015. The ratio of the allowance to non-performing loans held for investment was 47.79% as of June 30, 2015 compared to 40.11% as of March 31, 2015. The increase in the ratio is driven by the reduction in non-performing loans as a result of the bulk sale of assets completed during the second quarter.

The following table sets forth information concerning the composition of the Corporation’s allowance for loan and lease losses as of June 30, 2015 and March 31, 2015 by loan category and by whether the allowance and related provisions were calculated individually for impairment purposes or through a general valuation allowance:

(Dollars in thousands)	Residential Mortgage Loans			Commercial (including Commercial Mortgage, C&I, and Construction loans)			Consumer and Finance Leases			Total
As of June 30, 2015
Impaired loans:
Principal balance of loans, net of charge-offs	$	447,311		$	340,052		$	37,453		$	824,816
Allowance for loan and lease losses		17,136			24,477			8,305			49,918
Allowance for loan and lease losses to principal balance		3.83	%		7.20	%		22.17	%		6.05	%
PCI loans:
Carrying value of PCI loans		175,234			3,260			-			178,494
Allowance for PCI loans		3,061			102			-			3,163
Allowance for PCI loans to carrying value		1.75	%		3.13	%		-			1.77	%
Loans with general allowance:
Principal balance of loans		2,704,805			3,647,798			1,861,762			8,214,365
Allowance for loan and lease losses		13,586			100,278			54,573			168,437
Allowance for loan and lease losses to principal balance		0.50	%		2.75	%		2.93	%		2.05	%
Total loans held for investment:
Principal balance of loans	$	3,327,350		$	3,991,110		$	1,899,215		$	9,217,675
Allowance for loan and lease losses		33,783			124,857			62,878			221,518
Allowance for loan and lease losses to principal balance		1.02	%		3.13	%		3.31	%		2.40	%
As of March 31, 2015
Impaired loans:
Principal balance of loans, net of charge-offs	$	429,526		$	488,614		$	36,841		$	954,981
Allowance for loan and lease losses		14,862			41,490			5,788			62,140
Allowance for loan and lease losses to principal balance		3.46	%		8.49	%		15.71	%		6.51	%
PCI loans:
Carrying value of PCI loans		177,601			3,279			234			181,114
Allowance for PCI loans		-			-			-			-
Allowance for PCI loans to carrying value		-			-			-			-
Loans with general allowance:
Principal balance of loans		2,724,493			3,724,677			1,900,107			8,349,277
Allowance for loan and lease losses		13,820			87,355			62,749			163,924
Allowance for loan and lease losses to principal balance		0.51	%		2.35	%		3.30	%		1.96	%
Total loans held for investment:
Principal balance of loans	$	3,331,620		$	4,216,570		$	1,937,182		$	9,485,372
Allowance for loan and lease losses		28,682			128,845			68,537			226,064
Allowance for loan and lease losses to principal balance		0.86	%		3.06	%		3.54	%		2.38	%

Net Charge-Offs

The following table presents annualized net charge-offs to average loans held-in-portfolio:

	Quarter Ended
	June 30,			March 31,		December 31,		September 30,		June 30,
	2015			2015		2014		2014		2014
Residential mortgage	0.39	%		0.65	%	0.87	%	0.82	%	0.71	%
Commercial mortgage	10.37	%	(1)	0.90	%	0.31	%	-0.24	%	2.00	%
Commercial and Industrial	3.41	%	(2)	0.63	%	0.16	%	2.54	%	2.69	%	(5)
Construction	4.90	%	(3)	0.93	%	-1.48	%	6.57	%	5.25	%
Consumer and finance leases	2.38	%		3.30	%	3.73	%	3.62	%	3.27	%
Total loans	3.35	%	(4)	1.25	%	1.13	%	1.80	%	2.19	%	(6)
(1) Includes net charge-offs totaling $37.6 million associated with the bulk sale of assets. The ratio of commercial mortgage net charge-offs to average loans, excluding charge-offs associated with the bulk sale of assets, was 1.06%.
(2) Includes net charge-offs totaling $20.6 million associated with the bulk sale of assets. The ratio of commercial and industrial net charge-offs to average loans, excluding charge-offs associated with the bulk sale of assets, was (0.03)%.
(3) Includes net charge-offs totaling $3.3 million associated with the bulk sale of assets. The ratio of construction net charge-offs to average loans, excluding charge-offs associated with the bulk sale of assets, was (2.94)%.
(4) Includes net charge-offs totaling $61.4 million associated with the bulk sale of assets. The ratio of total charge-offs to average loans, excluding charge-offs associated with the bulk sale of assets, was 0.75%.
(5) Includes net charge-offs totaling $6.9 million associated with the acquisition of mortgage loans from Doral. The ratio of commercial and industrial net charge-offs to average loans, excluding charge-offs associated with the acquisition of mortgage loans from Doral, was 1.81%.
(6) Includes net charge-offs totaling $6.9 million associated with the acquisition of mortgage loans from Doral. The ratio of total net charge-offs to average loans, excluding charge-offs associated with the acquisition of mortgage loans from Doral, was 1.90%.

The ratios above are based on annualized net charge-offs and are not necessarily indicative of the results expected in subsequent periods.

Net charge-offs for the second quarter of 2015 were $78.8 million, or an annualized 3.35% of average loans, including $61.4 million of charge-offs related to the bulk sale of assets. Excluding the impact of charge-offs related to the bulk sale, total net charge-offs in the second quarter of 2015 were $17.4 million, or an annualized 0.75% of average loans, compared to $29.3 million, or an annualized 1.25%, in the first quarter of 2015. The decrease was mainly related to:

• A $4.8 million decrease in consumer loan net charge-offs, including the effect of $2.7 million of loss recoveries on the sale of certain loans that had been fully charged-off in prior periods.
• A $5.2 million decrease in commercial and construction loan net charge-offs, primarily related to the commercial and industrial loan portfolio in Puerto Rico. In addition, the decrease reflects a $1.6 million increase in loan loss recoveries in the Florida region.
• A $1.8 million decrease in residential mortgage loan net charge-offs.

STATEMENT OF FINANCIAL CONDITION

Total assets were approximately $12.6 billion as of June 30, 2015, down $569.1 million from March 31, 2015.

The decrease was mainly due to:

• A $269.4 million decrease in total loans driven by the $147.5 million of loans included in the bulk sale of assets, an additional $84.6 million decrease in commercial and construction loans that included $20.0 million sold in a participation and certain large repayments in Puerto Rico, and a $38.0 million decrease in consumer loans.

Total loan originations, including refinancings, renewals, and draws from existing revolving and non-revolving commitments, amounted to approximately $767.0 million, compared to $688.9 million in the first quarter of 2015. The increase was mainly due to a $44.8 million increase in residential mortgage loan originations, primarily refinancing and conforming loan originations, and a $58.2 million increase in commercial loan originations in Florida. These figures exclude the credit card utilization activity.

• A $302.0 million decrease in cash and cash equivalents primarily due to funds used for the $200 million reverse repurchase agreement entered into in April 2015 under a master netting arrangement. As mentioned above, this agreement qualifies for offsetting accounting, thus, the reverse repurchase agreement was netted against repurchase agreements in the consolidated statement of financial condition. The remainder of the variance is primarily linked to the decrease in brokered CDs.
• An $8.6 million decrease in investment securities driven by a $15.5 million decrease in the fair value of U.S. agency MBS, a $6.9 million decrease in the fair value of Puerto Rico Government debt securities, the redemption of a $12.0 million U.S. agency debt obligation prior to maturity, and MBS prepayments of approximately $68 million, partially offset by purchases of approximately $97 million (average yield of 2.09%) of U.S. agency securities.

Total liabilities were approximately $10.9 billion as of June 30, 2015, down $531.6 million from March 31, 2015.

The decrease was mainly due to:

• A $138.5 million decrease in deposits, excluding government deposits and brokered CDs, primarily in the Florida region that accounted for $103.9 million of the decrease.
• A $241.7 million decrease in brokered CDs.
• The netting of the $200 million reverse repurchase agreement against a repurchase agreement with the same counterparty, as described above.

Partially offset by:

• A $43.7 million increase in government deposits, primarily transactional accounts of municipalities in Puerto Rico.

Total stockholders’ equity amounted to $1.7 billion as of June 30, 2015, a decrease of $37.5 million from March 31, 2015, mainly driven by:

• The net loss of $34.1 million reported in the second quarter.
• A decrease of $10.2 million in other comprehensive income mainly attributable to the $15.5 million decrease in the fair value of U.S. agency MBS.

Partially offset by:

• The exchange of $5.3 million of trust preferred securities for shares of the Corporation’s common stock. During the second quarter of 2015, the Corporation exchanged trust preferred securities with a liquidation value of $5.3 million for 852,831 shares of the Corporation’s common stock.

On January 1, 2015, the Basel III rules became effective, subject to on-going, multi-year transition provisions primarily related to regulatory deductions and adjustments impacting common equity tier 1 capital, tier 1 capital and total capital. The Corporation’s common equity tier 1 capital, tier 1 capital, total capital and leverage ratios under the Basel III rules as of June 30, 2015 (including the 2015 phase-in of regulatory capital transition provisions) were 16.37%, 16.37%, 19.44% and 11.94%, respectively, compared to common equity tier 1 capital, tier 1 capital, total capital and leverage ratios of 16.15%, 16.15%, 19.20%, and 12.16%, respectively, as of the end of the first quarter of 2015.

Meanwhile, the common equity tier 1 capital, tier 1 capital, total capital and leverage ratios as of June 30, 2015 of our banking subsidiary, FirstBank Puerto Rico, were 15.81%, 17.85%, 19.13%, and 13.03%, respectively, compared to common equity tier 1 capital, tier 1 capital, total capital and leverage ratios of 15.62%, 17.61%, 18.89% and 13.28%, respectively, as of the end of the prior quarter.

Tangible Common Equity

The Corporation’s tangible common equity ratio increased to 12.61% as of June 30, 2015 from 12.33% as of March 31, 2015.

The following table is a reconciliation of the Corporation’s tangible common equity and tangible assets over the last five quarters to the comparable GAAP items:

(In thousands, except ratios and per share information)
	June 30,			March 31,			December 31,			September 30,			June 30,
	2015			2015			2014			2014			2014
Tangible Equity:
Total equity - GAAP	$	1,668,220		$	1,705,750		$	1,671,743		$	1,324,157		$	1,306,001
Preferred equity		(36,104	)		(36,104	)		(36,104	)		(36,104	)		(36,104	)
Goodwill		(28,098	)		(28,098	)		(28,098	)		(28,098	)		(28,098	)
Purchased credit card relationship		(14,854	)		(15,622	)		(16,389	)		(17,235	)		(18,080	)
Core deposit intangible		(10,283	)		(10,914	)		(5,420	)		(5,810	)		(6,200	)
Tangible common equity	$	1,578,881		$	1,615,012		$	1,585,732		$	1,236,910		$	1,217,519
Tangible Assets:
Total assets - GAAP	$	12,578,813		$	13,147,919		$	12,727,835		$	12,643,280		$	12,523,251
Goodwill		(28,098	)		(28,098	)		(28,098	)		(28,098	)		(28,098	)
Purchased credit card relationship		(14,854	)		(15,622	)		(16,389	)		(17,235	)		(18,080	)
Core deposit intangible		(10,283	)		(10,914	)		(5,420	)		(5,810	)		(6,200	)
Tangible assets	$	12,525,578		$	13,093,285		$	12,677,928		$	12,592,137		$	12,470,873
Common shares outstanding		214,694			213,827			212,985			212,978			212,760
Tangible common equity ratio		12.61	%		12.33	%		12.51	%		9.82	%		9.76	%
Tangible book value per common share	$	7.35		$	7.55		$	7.45		$	5.81		$	5.72

Exposure to Puerto Rico Government

As of June 30, 2015, the Corporation had $340.0 million of credit facilities, excluding investment securities, granted to the Puerto Rico Government, its municipalities and public corporations, of which $326.7 million was outstanding (book value of $325.8 million), compared to $321.7 million outstanding as of March 31, 2015. Approximately $204.3 million of the granted credit facilities outstanding consisted of loans to municipalities in Puerto Rico for which, in most cases, the good faith, credit and unlimited taxing power of the applicable municipality have been pledged to their repayment. Approximately $23.3 million consisted of loans to units of the central government, and approximately $99.0 million ($98.1 million book value) consisted of loans to public corporations, including the direct exposure to PREPA with a book value of $74.1 million as of June 30, 2015. In addition, the Corporation had $131.0 million outstanding in financings to the hotel industry in Puerto Rico guaranteed by the Puerto Rico Tourism Development Fund as of June 30, 2015, down $1.5 million, compared to $132.5 million outstanding as of March 31, 2015.

The Corporation held $52.7 million of obligations of the Puerto Rico government as part of its available-for-sale investment securities portfolio, net of the $12.9 million other-than-temporary credit impairment recorded in the second quarter, carried on its books at a fair value of $34.6 million as of June 30, 2015.

As of June 30, 2015, the Corporation had $326.9 million of public sector deposits in Puerto Rico, compared to $283.0 million as of March 31, 2015. Approximately 54% is from municipalities in Puerto Rico and 46% is from public corporations and the central government and agencies.

Conference Call / Webcast Information

First BanCorp’s senior management will host an earnings conference call and live webcast on Thursday, July 30, 2015, at 10:00 a.m. (Eastern Time). The call may be accessed via a live Internet webcast through the investor relations section of the Corporation’s web site: www.1firstbank.com or through a dial-in telephone number at (877) 506-6537 or (412) 380–2001 for international callers. The Corporation recommends that listeners go to the web site at least 15 minutes prior to the call to download and install any necessary software. Following the webcast presentation, a question and answer session will be made available to research analysts and institutional investors. A replay of the webcast will be archived in the investor relations section of First BanCorp’s web site, www.1firstbank.com, until July 29, 2016. A telephone replay will be available one hour after the end of the conference call through August 30, 2015 at (877) 344-7529 or (412) 317-0088 for international callers. The conference number is 10069784.

Safe Harbor

This press release may contain “forward-looking statements” concerning the Corporation’s future economic performance. The words or phrases “expect,” “anticipate,” “look forward,” “should,” “believes” and similar statements of a future or forward-looking nature that reflect our current views with respect to future events and financial performance are meant to identify “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbor created by such sections. The Corporation wishes to caution readers not to place undue reliance on any such “forward-looking statements,” which speak only as of the date made, and to advise readers that various factors, including, but not limited to, the following could cause actual results to differ materially from those expressed in, or implied by such forward-looking statements: uncertainty about whether the Corporation will be able to continue to fully comply with the written agreement dated June 3, 2010 that the Corporation entered into with the Federal Reserve Bank of New York (the “New York Fed”) that, among other things, requires the Corporation to serve as a source of strength to FirstBank and that, except with the consent generally of the New York Fed and the Board of Governors of the Federal Reserve System (the “Federal Reserve Board”), prohibits the Corporation from paying dividends to stockholders or receiving dividends from FirstBank, making payments on trust preferred securities or subordinated debt and incurring, increasing or guaranteeing debt or repurchasing any capital securities; uncertainty as to the availability of certain funding sources, such as brokered CDs; the Corporation’s reliance on brokered CDs to fund operations and provide liquidity; the risk of not being able to fulfill the Corporation’s cash obligations or resume paying dividends to the Corporation’s stockholders in the future due to the Corporation’s need to receive approval from the New York Fed and the Federal Reserve Board to receive dividends from FirstBank or FirstBank’s failure to generate sufficient cash flow to make a dividend payment to the Corporation; the strength or weakness of the real estate markets and of the consumer and commercial sectors and their impact on the credit quality of the Corporation’s loans and other assets, which has contributed and may continue to contribute to, among other things, high levels of non-performing assets, charge-offs and provisions for loan and lease losses and may subject the Corporation to further risk from loan defaults and foreclosures; the ability of FirstBank to realize the benefits of its deferred tax assets subject to the remaining valuation allowance; additional adverse changes in general economic conditions in Puerto Rico, the U.S., and the U.S. Virgin Islands and British Virgin Islands, including the interest rate environment, market liquidity, housing absorption rates, real estate prices, and disruptions in the U.S. capital markets, which has reduced interest margins and affected funding sources, and has affected demand for all of the Corporation’s products and services and reduced the Corporation’s revenues and earnings, and the value of the Corporation’s assets; a credit default by the Puerto Rico government or any of its public corporations or other instrumentalities, and recent and any future downgrades of the long-term and short-term debt ratings of the Puerto Rico government, which could exacerbate Puerto Rico’s adverse economic conditions; an adverse change in the Corporation’s ability to attract new clients and retain existing ones; a decrease in demand for the Corporation’s products and services and lower revenues and earnings because of the continued recession in Puerto Rico, the current fiscal problems of the Puerto Rico government and recent credit downgrades of the Puerto Rico government’s debt; the risk that any portion of the unrealized losses in the Corporation’s investment portfolio is determined to be other-than-temporary, including additional impairments on the Puerto Rico government’s obligations; uncertainty about regulatory and legislative changes for financial services companies in Puerto Rico, the U.S., the U.S. Virgin Islands and British Virgin Islands, which could affect the Corporation’s financial condition or performance and could cause the Corporation’s actual results for future periods to differ materially from prior results and anticipated or projected results; changes in the fiscal and monetary policies and regulations of the U.S. federal government and the Puerto Rico and other governments, including those determined by the Federal Reserve Board, the New York Fed, the FDIC, government-sponsored housing agencies, and regulators in Puerto Rico and the U.S. and British Virgin Islands; the risk of possible failure or circumvention of controls and procedures and the risk that the Corporation’s risk management policies may not be adequate; the risk that the FDIC may increase the deposit insurance premium and/or require special assessments to replenish its insurance fund, causing an additional increase in the Corporation’s non-interest expenses; the impact on the Corporation’s results of operations and financial condition of acquisitions and dispositions, including the recent acquisition of loans and branches of Doral Bank as well as the assumption of deposits at the branches; a need to recognize impairments on financial instruments, goodwill, or other intangible assets relating to acquisitions; the risk that downgrades in the credit ratings of the Corporation’s long-term senior debt will adversely affect the Corporation’s ability to access necessary external funds; the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act on the Corporation’s businesses, business practices, and cost of operations; and general competitive factors and industry consolidation. The Corporation does not undertake, and specifically disclaims any obligation, to update any “forward-looking statements” to reflect occurrences or unanticipated events or circumstances after the date of such statements except as required by the federal securities laws.

Basis of Presentation

Use of Non-GAAP Financial Measures

This press release contains non-GAAP financial measures. Non-GAAP financial measures are set forth when management believes they will be helpful to an understanding of the Corporation’s results of operations or financial position. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the text or in the attached tables to this earnings release.

Tangible Common Equity Ratio and Tangible Book Value per Common Share

The tangible common equity ratio and tangible book value per common share are non-GAAP financial measures generally used by the financial community to evaluate capital adequacy. Tangible common equity is total equity less preferred equity, goodwill, core deposit intangibles, and other intangibles, such as the purchased credit card relationship intangible. Tangible assets are total assets less goodwill, core deposit intangibles, and other intangibles, such as the purchased credit card relationship intangible. Management and many stock analysts use the tangible common equity ratio and tangible book value per common share in conjunction with more traditional bank capital ratios to compare the capital adequacy of banking organizations with significant amounts of goodwill or other intangible assets, typically stemming from the use of the purchase method of accounting for mergers and acquisitions. Neither tangible common equity nor tangible assets, or the related measures should be considered in isolation or as a substitute for stockholders’ equity, total assets, or any other measure calculated in accordance with GAAP. Moreover, the manner in which the Corporation calculates its tangible common equity, tangible assets, and any other related measures may differ from that of other companies reporting measures with similar names.

Adjusted Pre-Tax, Pre-Provision Income

Adjusted pre-tax, pre-provision income is a non-GAAP performance metric that management believes is useful in analyzing underlying performance trends, particularly in times of economic stress. Adjusted pre-tax, pre-provision income, as defined by management, represents net income (loss) excluding income tax expense (benefit), the provision for loan and lease losses, gains on sale and OTTI of investment securities, fair value adjustments on derivatives, equity in earnings or loss of unconsolidated entity up until the second quarter of 2014 when the value of the investment became zero as well as certain items identified as unusual, non-recurring or non-operating.

In addition, from time to time, adjusted pre-tax, pre-provision income will reflect the omission of revenue or expense items that management judges to be outside of ordinary banking activities or of items that, while they may be associated with ordinary banking activities, are so unusually large that management believes that a complete analysis of the Corporation’s performance requires consideration also of adjusted pre-tax, pre-provision income that excludes such amounts.

Net Interest Income, Excluding Valuations and Prepayment Penalty, and on a Tax-Equivalent Basis

Net interest income, interest rate spread, and net interest margin are reported excluding the changes in the fair value of derivative instruments and a $2.5 million prepayment penalty collected on a commercial mortgage loan paid off in the fourth quarter of 2014, and on a tax-equivalent basis. The presentation of net interest income excluding valuations and the $2.5 million prepayment penalty provides additional information about the Corporation’s net interest income and facilitates comparability and analysis. The changes in the fair value of derivative instruments have no effect on interest due or interest earned on interest-bearing liabilities or interest-earning assets, respectively. The tax-equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets and assumes a marginal income tax rate. Income from tax-exempt earning assets is increased by an amount equivalent to the taxes that would have been paid if this income had been taxable at statutory rates. Management believes that it is a standard practice in the banking industry to present net interest income, interest rate spread, and net interest margin on a fully tax-equivalent basis. This adjustment puts all earning assets, most notably tax-exempt securities and certain loans, on a common basis that facilitates comparison of results to results of peers.

Financial measures adjusted to exclude the effect of the bulk sale of assets, the OTTI charge on Puerto Rico Government debt securities, the bargain purchase gain and certain non-recurring expenses related to the acquisition of loans and assumption of deposits from Doral.

To supplement the Corporation’s financial statements presented in accordance with GAAP, the Corporation provides additional measures of adjusted net charge-offs, adjusted non-interest expenses, adjusted non-interest income, and adjusted pre-tax income. Adjusted non-interest expenses exclude certain acquisition and conversion costs incurred in the Doral transaction that are considered non-recurring in nature and expenses and losses directly associated with the bulk sale of assets. Adjusted non-interest income excludes the $12.9 million OTTI charge on Puerto Rico Government debt securities recorded in the second quarter of 2015, the $0.6 million loss on a commercial mortgage loan held for sale included as part of the bulk sale of assets in the second quarter, and the $13.4 million bargain purchase gain on assets acquired and deposits assumed from Doral in the first quarter of 2015. Adjusted pre-tax income excludes the effect of all the aforementioned non-recurring items. Management believes that these non-GAAP measures enhance the ability of analysts and investors to analyze trends in the Corporation’s business and to better understand the performance of the Corporation. In addition, the Corporation may utilize these non-GAAP financial measures as a guide in its budgeting and long-term planning process. Any analysis of these non-GAAP financial measures should be used only in conjunction with results presented in accordance with GAAP. See Recent Events-Non-GAAP Reconciliation section above for reconciliations of these non-GAAP financial measures to the corresponding measures calculated and presented in accordance with GAAP.

FIRST BANCORP
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
	As of
	June 30,			March 31,			December 31,
(In thousands, except for share information)	2015			2015			2014
ASSETS
Cash and due from banks	$	462,934		$	767,471		$	779,147
Money market investments:
Time deposits with other financial institutions		3,000			300			300
Other short-term investments		216,469			216,665			16,661
Total money market investments		219,469			216,965			16,961
Investment securities available for sale, at fair value		1,965,683			1,974,226			1,965,666
Other equity securities		26,152			26,185			25,752
Total investment securities		1,991,835			2,000,411			1,991,418
Loans, net of allowance for loan and lease losses of $221,518
(March 31, 2015 - $226,064; December 31, 2014 - $222,395)		8,996,157			9,259,308			9,040,041
Loans held for sale, at lower of cost or market		80,026			81,723			76,956
Total loans, net		9,076,183			9,341,031			9,116,997
Premises and equipment, net		164,643			166,799			166,926
Other real estate owned		122,129			122,628			124,003
Accrued interest receivable on loans and investments		50,191			49,302			50,796
Other assets		491,429			483,312			481,587
Total assets	$	12,578,813		$	13,147,919		$	12,727,835
LIABILITIES
Deposits:
Non-interest-bearing deposits	$	1,271,464		$	1,175,943		$	900,616
Interest-bearing deposits		8,233,112			8,665,095			8,583,329
Total deposits		9,504,576			9,841,038			9,483,945
Securities sold under agreements to repurchase		700,000			900,000			900,000
Advances from the Federal Home Loan Bank (FHLB)		325,000			325,000			325,000
Other borrowings		226,492			231,959			231,959
Accounts payable and other liabilities		154,525			144,172			115,188
Total liabilities		10,910,593			11,442,169			11,056,092
STOCKHOLDERS' EQUITY
Preferred Stock, authorized 50,000,000 shares; issued
22,828,174 shares; outstanding 1,444,146 shares; aggregate
liquidation value of $36,104		36,104			36,104			36,104
Common stock, $0.10 par value, authorized 2,000,000,000
shares; issued, 215,552,377 shares (March 31, 2015 -
214,618,015 shares issued; December 31, 2014 - 213,724,749
shares issued)		21,555			21,462			21,372
Less: Treasury stock (at par value)		(86	)		(79	)		(74	)
Common stock outstanding, 214,694,470 shares outstanding
(March 31, 2015 - 213,827,258 shares outstanding; December 31,
2014 - 212,984,700 shares outstanding)		21,469			21,383			21,298
Additional paid-in capital		923,829			917,203			916,067
Retained earnings		708,197			742,271			716,625
Accumulated other comprehensive loss		(21,379	)		(11,211	)		(18,351	)
Total stockholders' equity		1,668,220			1,705,750			1,671,743
Total liabilities and stockholders' equity	$	12,578,813		$	13,147,919		$	12,727,835

FIRST BANCORP
CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME
	Quarter Ended									Six-Month Period Ended
	June 30,			March 31,			June 30,			June 30,			June 30,
(In thousands, except per share information)	2015			2015			2014			2015			2014
Net interest income:
Interest income	$	151,632		$	152,485		$	158,423		$	304,117		$	318,994
Interest expense		25,155			26,838			28,516			51,993			57,767
Net interest income		126,477			125,647			129,907			252,124			261,227
Provision for loan and lease losses		74,266			32,970			26,744			107,236			58,659
Net interest income after provision for loan and lease losses		52,211			92,677			103,163			144,888			202,568
Non-interest income:
Service charges on deposit accounts		5,219			4,555			4,222			9,774			8,349
Mortgage banking activities		4,763			3,618			3,036			8,381			6,404
Net (loss) gain on investments and impairments		(13,097	)		(156	)		291			(13,253	)		291
Equity in loss of unconsolidated entity		-			-			(670	)		-			(7,280	)
Bargain purchase gain		-			13,443			-			13,443			-
Other non-interest income		9,785			11,269			9,052			21,054			19,517
Total non-interest income		6,670			32,729			15,931			39,399			27,281
Non-interest expenses:
Employees' compensation and benefits		37,945			35,654			34,793			73,599			67,691
Occupancy and equipment		15,059			14,349			14,482			29,408			28,800
Business promotion		3,934			2,868			4,142			6,802			8,115
Professional fees		19,005			15,218			11,955			34,223			22,448
Taxes, other than income taxes		3,131			3,001			4,504			6,132			9,079
Insurance and supervisory fees		6,796			6,860			10,784			13,656			21,774
Net loss on other real estate owned operations		4,874			2,628			6,778			7,502			12,615
Other non-interest expenses		12,055			11,150			10,707			23,205			20,408
Total non-interest expenses		102,799			91,728			98,145			194,527			190,930
(Loss) income before income taxes		(43,918	)		33,678			20,949			(10,240	)		38,919
Income tax benefit (expense)		9,844			(8,032	)		276			1,812			(611	)
Net (loss) income	$	(34,074	)	$	25,646		$	21,225		$	(8,428	)	$	38,308
Net (loss) income attributable to common stockholders	$	(34,074	)	$	25,646		$	22,505		$	(8,428	)	$	39,967
(Loss) earnings per common share:
Basic	$	(0.16	)	$	0.12		$	0.11		$	(0.04	)	$	0.19
Diluted	$	(0.16	)	$	0.12		$	0.11		$	(0.04	)	$	0.19

About First BanCorp.

First BanCorp. is the parent corporation of FirstBank Puerto Rico, a state-chartered commercial bank with operations in Puerto Rico, the Virgin Islands and Florida, and of FirstBank Insurance Agency. First BanCorp. and FirstBank Puerto Rico operate within U.S. banking laws and regulations. The Corporation operates a total of 166 branches, stand-alone offices, and in-branch service centers throughout Puerto Rico, the U.S. and British Virgin Islands, and Florida. Among the subsidiaries of FirstBank Puerto Rico are First Federal Finance Corp., a small loan company; FirstBank Puerto Rico Securities, a broker-dealer subsidiary; and First Management of Puerto Rico, a domestic corporation that holds tax-exempt assets. In the U.S. Virgin Islands, FirstBank operates First Express, a small loan company. First BanCorp’s shares of common stock trade on the New York Stock Exchange under the symbol FBP. Additional information about First BanCorp. may be found at www.1firstbank.com.

EXHIBIT A

Table 1 – Selected Financial Data

(In thousands, except for per share and financial ratios)
	Quarter Ended										Six Month Period Ended
	June 30,				March 31,			June 30,			June 30,				June 30,
	2015				2015			2014			2015				2014
Condensed Income Statements:
Total interest income	$	151,632			$	152,485		$	158,423		$	304,117			$	318,994
Total interest expense		25,155				26,838			28,516			51,993				57,767
Net interest income		126,477				125,647			129,907			252,124				261,227
Provision for loan and lease losses		74,266				32,970			26,744			107,236				58,659
Non-interest income		6,670				32,729			15,931			39,399				27,281
Non-interest expenses		102,799				91,728			98,145			194,527				190,930
(Loss) income before income taxes		(43,918	)			33,678			20,949			(10,240	)			38,919
Income tax benefit (expense)		9,844				(8,032	)		276			1,812				(611	)
Net (loss) income		(34,074	)			25,646			21,225			(8,428	)			38,308
Net (loss) income attributable to common stockholders		(34,074	)			25,646			22,505			(8,428	)			39,967
Per Common Share Results:
Net (loss) earnings per share basic	$	(0.16	)		$	0.12		$	0.11		$	(0.04	)		$	0.19
Net (loss) earnings per share diluted	$	(0.16	)		$	0.12		$	0.11		$	(0.04	)		$	0.19
Cash dividends declared	$	-			$	-		$	-		$	-			$	-
Average shares outstanding		211,247				210,686			208,202			210,968				206,974
Average shares outstanding diluted		211,247				212,746			210,144			210,968				208,517
Book value per common share	$	7.60			$	7.81		$	5.97		$	7.60			$	5.97
Tangible book value per common share (1)	$	7.35			$	7.55		$	5.72		$	7.35			$	5.72
Selected Financial Ratios (In Percent):
Profitability:
Return on Average Assets		(1.06	)			0.81			0.67			(0.13	)			0.61
Interest Rate Spread (2)		4.13				4.13			4.19			4.12				4.22
Net Interest Margin (2)		4.33				4.31			4.37			4.32				4.40
Return on Average Total Equity		(8.06	)			6.15			6.66			(1.00	)			6.12
Return on Average Common Equity		(8.23	)			6.29			6.95			(1.03	)			6.41
Average Total Equity to Average Total Assets		13.19				13.13			10.10			13.16				9.93
Total capital		19.44				19.20			18.06			19.44				18.06
Common equity Tier 1 capital		16.37				16.15			13.92			16.37				13.92
Tier 1 capital		16.37				16.15			16.80			16.37				16.80
Leverage		11.94				12.16			12.04			11.94				12.04
Tangible common equity ratio (1)		12.61				12.33			9.76			12.61				9.76
Dividend payout ratio		-				-			-			-				-
Efficiency ratio (3)		77.21				57.92			67.30			66.73				66.18
Asset Quality:
Allowance for loan and lease losses to loans held for investment		2.40				2.38			2.55			2.40				2.55
Net charge-offs (annualized) to average loans		3.35		(4)		1.25			2.19	(6)		2.30		(4)		2.15		(6)
Provision for loan and lease losses to net charge-offs		94.23		(5)		112.52			51.09	(7)		99.19		(5)		56.76		(7)
Non-performing assets to total assets		5.12				5.74			6.05			5.12				6.05
Non-performing loans held for investment to total loans held for investment		5.03				5.94			5.96			5.03				5.96
Allowance to total non-performing loans held for investment		47.79				40.11			42.71			47.79				42.71
Allowance to total non-performing loans held for investment excluding residential real estate loans		76.77				57.82			61.96			76.77				61.96
Other Information:
Common Stock Price: End of period	$	4.82			$	6.20		$	5.44		$	4.82			$	5.44
1- Non-GAAP measure. See page 15 for GAAP to Non-GAAP reconciliations.
2- On a tax-equivalent basis and excluding changes in the fair value of derivative instruments (Non-GAAP measure). See page 6 for GAAP to Non-GAAP reconciliations and refer to discussions in Tables 2 and 3 below.
3- Non-interest expenses to the sum of net interest income and non-interest income. The denominator includes non-recurring income and changes in the fair value of derivative instruments.
4 - The ratio of net charge-offs to average loans, excluding charge-offs associated with the bulk sale of assets, was 0.75% and 1.01% for the quarter and six-month period ended June 30, 2015, respectively.
5 - The ratio of provision for loan and lease losses to net charge-offs, excluding the impact of the bulk sale of assets, was 157.21% and 129.16% for the quarter and six-month period ended June 30, 2015, respectively.
6 - The ratio of net charge-offs to average loans, excluding the impact associated with the acquisition of mortgage loans from Doral in the second quarter of 2014, was 1.90% and 2.01% for the quarter and six-month period ended June 30, 2014, respectively.
7 - The ratio of provision for loan and lease losses to net charge-offs, excluding the impact associated with the acquisition of mortgage loans from Doral in the second quarter of 2014, was 55.72% and 59.35% for the quarter and six-month period ended June 30, 2014, respectively.

Table 2 – Quarterly Statement of Average Interest-Earning Assets and Average Interest-Bearing
Liabilities (On a Tax-Equivalent Basis and Excluding Valuations)

(Dollars in thousands)
	Average volume						Interest income (1) / expense						Average rate (1)
	June 30,		March 31,		June 30,		June 30,		March 31,		June 30,		June 30,		March 31,		June 30,
Quarter ended	2015		2015		2014		2015		2015		2014		2015		2015		2014
Interest-earning assets:
Money market & other short-term investments	$	737,227	$	808,754	$	729,302	$	510	$	537	$	454	0.28	%	0.27	%	0.25	%
Government obligations (2)		469,155		421,948		335,813		2,617		2,338		2,101	2.24	%	2.25	%	2.51	%
Mortgage-backed securities		1,508,831		1,551,804		1,717,748		10,297		12,501		14,191	2.74	%	3.27	%	3.31	%
FHLB stock		25,435		25,467		27,995		257		295		273	4.05	%	4.70	%	3.91	%
Other investments		818		357		320		-		-		-	0.00	%	0.00	%	0.00	%
Total investments (3)		2,741,466		2,808,330		2,811,178		13,681		15,671		17,019	2.00	%	2.26	%	2.43	%
Residential mortgage loans		3,321,269		3,120,648		2,635,082		46,310		43,482		36,707	5.59	%	5.65	%	5.59	%
Construction loans		169,890		172,055		198,665		1,566		1,532		1,691	3.70	%	3.61	%	3.41	%
C&I and commercial mortgage loans		4,002,266		4,127,305		4,658,776		43,316		43,671		50,473	4.34	%	4.29	%	4.35	%
Finance leases		228,749		230,299		243,014		4,507		4,611		4,985	7.90	%	8.12	%	8.23	%
Consumer loans		1,687,243		1,729,448		1,825,255		46,875		47,523		52,291	11.14	%	11.14	%	11.49	%
Total loans (4) (5)		9,409,417		9,379,755		9,560,792		142,574		140,819		146,147	6.08	%	6.09	%	6.13	%
Total interest-earning assets	$	12,150,883	$	12,188,085	$	12,371,970	$	156,255	$	156,490	$	163,166	5.16	%	5.21	%	5.29	%
Interest-bearing liabilities:
Brokered CDs	$	2,437,937	$	2,736,653	$	3,124,808	$	6,039	$	6,610	$	7,496	0.99	%	0.98	%	0.96	%
Other interest-bearing deposits		6,034,536		5,848,597		5,838,450		10,941		11,084		11,970	0.73	%	0.77	%	0.82	%
Other borrowed funds		971,194		1,131,959		1,131,959		7,231		8,210		8,217	2.99	%	2.94	%	2.91	%
FHLB advances		325,000		325,000		300,220		944		934		833	1.17	%	1.17	%	1.11	%
Total interest-bearing liabilities	$	9,768,667	$	10,042,209	$	10,395,437	$	25,155	$	26,838	$	28,516	1.03	%	1.08	%	1.10	%
Net interest income							$	131,100	$	129,652	$	134,650
Interest rate spread													4.13	%	4.13	%	4.19	%
Net interest margin													4.33	%	4.31	%	4.37	%
1- On a tax-equivalent basis. The tax-equivalent yield was estimated by dividing the interest rate spread on exempt assets by 1 less the Puerto Rico statutory tax rate of 39% and adding to it the cost of interest-bearing liabilities. When adjusted to a tax-equivalent basis, yields on taxable and exempt assets are comparable. Changes in the fair value of derivative instruments are excluded from interest income because the changes in valuation do not affect interest paid or received.
2- Government obligations include debt issued by government-sponsored agencies.
3- Unrealized gains and losses on available-for-sale securities are excluded from the average volumes.
4- Average loan balances include the average of non-performing loans.
5- Interest income on loans includes $2.5 million, $2.7 million and $2.8 million for the quarters ended June 30, 2015, March 31, 2015, and June 30, 2014, respectively, of income from prepayment penalties and late fees related to the Corporation's loan portfolio.

Table 3 – Year-to-Date Statement of Average Interest-Earning Assets and Average Interest-Bearing
Liabilities (On a Tax-Equivalent Basis and Excluding Valuations)

(Dollars in thousands)
	Average volume				Interest income (1) / expense				Average rate (1)
	June 30,		June 30,		June 30,		June 30,		June 30,		June 30,
Six-Month Period Ended	2015		2014		2015		2014		2015		2014
Interest-earning assets:
Money market & other short-term investments	$	774,782	$	736,772	$	1,047	$	954	0.27	%	0.26	%
Government obligations (2)		445,682		339,313		4,955		4,159	2.24	%	2.47	%
Mortgage-backed securities		1,530,197		1,709,097		22,798		30,283	3.00	%	3.57	%
FHLB stock		25,451		28,199		552		614	4.37	%	4.39	%
Other investments		590		320		-		-	0.00	%	0.00	%
Total investments (3)		2,776,702		2,813,701		29,352		36,010	2.13	%	2.58	%
Residential mortgage loans		3,221,513		2,592,738		89,792		71,665	5.62	%	5.57	%
Construction loans		170,967		207,553		3,098		3,706	3.65	%	3.60	%
C&I and commercial mortgage loans		4,064,440		4,741,613		86,987		101,785	4.32	%	4.33	%
Finance leases		229,520		244,613		9,118		10,175	8.01	%	8.39	%
Consumer loans		1,708,229		1,824,966		94,398		105,306	11.14	%	11.64	%
Total loans (4) (5)		9,394,669		9,611,483		283,393		292,637	6.08	%	6.14	%
Total interest-earning assets	$	12,171,371	$	12,425,184	$	312,745	$	328,647	5.18	%	5.33	%
Interest-bearing liabilities:
Brokered CDs	$	2,586,470	$	3,154,996	$	12,649	$	15,103	0.99	%	0.97	%
Other interest-bearing deposits		5,900,493		5,881,642		22,025		24,662	0.75	%	0.85	%
Other borrowed funds		1,051,132		1,131,959		15,441		16,345	2.96	%	2.91	%
FHLB advances		325,000		300,110		1,878		1,657	1.17	%	1.11	%
Total interest-bearing liabilities	$	9,863,095	$	10,468,707	$	51,993	$	57,767	1.06	%	1.11	%
Net interest income					$	260,752	$	270,880
Interest rate spread									4.12	%	4.22	%
Net interest margin									4.32	%	4.40	%
1- On a tax-equivalent basis. The tax-equivalent yield was estimated by dividing the interest rate spread on exempt assets by 1 less the Puerto Rico statutory tax rate of 39% and adding to it the cost of interest-bearing liabilities. When adjusted to a tax-equivalent basis, yields on taxable and exempt assets are comparable. Changes in the fair value of derivative instruments are excluded from interest income because the changes in valuation do not affect interest paid or received.
2- Government obligations include debt issued by government-sponsored agencies.
3- Unrealized gains and losses on available-for-sale securities are excluded from the average volumes.
4- Average loan balances include the average of non-performing loans.
5- Interest income on loans includes $5.2 million, and $5.8 million for the six-month period ended June 30, 2015 and 2014, respectively, of income from prepayment penalties and late fees related to the Corporation's loan portfolio.

Table 4 – Non-Interest Income

		Quarter Ended									Six-Month Period Ended
		June 30,			March 31,			June 30,			June 30,			June 30,
(In thousands)		2015			2015			2014			2015			2014
	Service charges on deposit accounts	$	5,219		$	4,555		$	4,222		$	9,774		$	8,349
	Mortgage banking activities		4,763			3,618			3,036			8,381			6,404
	Insurance income		1,522			3,022			1,467			4,544			4,038
	Broker-dealer income		-			-			-			-			459
	Other operating income		8,263			8,247			7,585			16,510			15,020
	Non-interest income before net (loss)
	gain on investments, bargain purchase
	gain and equity in loss of
	unconsolidated entity		19,767			19,442			16,310			39,209			34,270
	Net gain on sale of investments		-			-			291			-			291
	OTTI on debt securities		(13,097	)		(156	)		-			(13,253	)		-
	Net (loss) gain on investments		(13,097	)		(156	)		291			(13,253	)		291
	Bargain purchase gain		-			13,443			-			13,443			-
	Equity in loss of unconsolidated entity		-			-			(670	)		-			(7,280	)
		$	6,670		$	32,729		$	15,931		$	39,399		$	27,281

Table 5 – Non-Interest Expenses

		Quarter Ended						Six-Month Period Ended
		June 30,		March 31,		June 30,		June 30,		June 30,
(In thousands)		2015		2015		2014		2015		2014
	Employees' compensation and benefits	$	37,841	$	35,654	$	34,793	$	73,495	$	67,691
	Occupancy and equipment		15,059		14,231		14,246		29,290		27,846
	Deposit insurance premium		5,405		5,770		9,579		11,175		19,401
	Other insurance and supervisory fees		1,391		1,090		1,205		2,481		2,373
	Taxes, other than income taxes		3,131		3,001		4,504		6,132		9,079
	Professional fees:
	Collections, appraisals and other credit related fees		3,777		3,432		2,717		7,209		4,471
	Outsourcing technology services		4,789		4,704		4,600		9,493		8,814
	Other professional fees		7,539		5,356		4,073		12,895		8,598
	Credit and debit card processing expenses		3,945		3,957		3,882		7,902		7,706
	Branch consolidations and other restructuring expenses		-		-		236		-		954
	Business promotion		3,660		2,705		4,142		6,365		8,115
	Communications		2,045		1,608		1,894		3,653		3,773
	Net loss on OREO operations		4,624		2,628		6,778		7,252		12,615
	Loss on sale of certain OREOs included in the bulk sale		250		-		-		250		-
	Expenses related to bulk sale of assets		918		-		-		918		-
	Non-recurring expenses related to
	acquisitions of loans/assumption
	of deposits from Doral		2,562		2,084		576		4,646		576
	Other		5,863		5,508		4,920		11,371		8,918
	Total	$	102,799	$	91,728	$	98,145	$	194,527	$	190,930

Table 6 – Selected Balance Sheet Data

(In thousands)		As of
		June 30,			March 31,			December 31,
		2015			2015			2014
Balance Sheet Data:
	Loans, including loans held for sale	$	9,297,701		$	9,567,095		$	9,339,392
	Allowance for loan and lease losses		221,518			226,064			222,395
	Money market and investment securities		2,211,304			2,217,376			2,008,380
	Intangible assets		53,235			54,634			49,907
	Deferred tax asset, net		310,385			310,869			313,045
	Total assets		12,578,813			13,147,919			12,727,835
	Deposits		9,504,576			9,841,038			9,483,945
	Borrowings		1,251,492			1,456,959			1,456,959
	Total preferred equity		36,104			36,104			36,104
	Total common equity		1,653,495			1,680,857			1,653,990
	Accumulated other comprehensive loss, net of tax		(21,379	)		(11,211	)		(18,351	)
	Total equity		1,668,220			1,705,750			1,671,743

Table 7 – Loan Portfolio

Composition of the loan portfolio including loans held for sale at period-end.

(In thousands)		As of
		June 30,		March 31,		December 31,
		2015		2015		2014
Residential mortgage loans		$	3,327,350	$	3,331,620	$	3,011,187
Commercial loans:
	Construction loans		120,848		124,440		123,480
	Commercial mortgage loans		1,518,151		1,649,263		1,665,787
	Commercial and Industrial loans		2,352,111		2,442,867		2,479,437
Commercial loans			3,991,110		4,216,570		4,268,704
Finance leases			228,280		230,183		232,126
Consumer loans			1,670,935		1,706,999		1,750,419
	Loans held for investment		9,217,675		9,485,372		9,262,436
Loans held for sale			80,026		81,723		76,956
	Total loans	$	9,297,701	$	9,567,095	$	9,339,392

Table 8 – Loan Portfolio by Geography

(In thousands)		As of June 30, 2015
		Puerto Rico		Virgin Islands		United States		Consolidated
Residential mortgage loans		$	2,612,613	$	333,914	$	380,823	$	3,327,350
Commercial loans:
	Construction loans		62,037		30,168		28,643		120,848
	Commercial mortgage loans		1,182,764		73,516		261,871		1,518,151
	Commercial and Industrial loans		1,925,811		121,361		304,939		2,352,111
Commercial loans			3,170,612		225,045		595,453		3,991,110
Finance leases			228,280		-		-		228,280
Consumer loans			1,583,342		47,071		40,522		1,670,935
Loans held for investment			7,594,847		606,030		1,016,798		9,217,675
Loans held for sale			38,425		40,170		1,431		80,026
	Total loans	$	7,633,272	$	646,200	$	1,018,229	$	9,297,701
(In thousands)		As of March 31, 2015
		Puerto Rico		Virgin Islands		United States		Consolidated
Residential mortgage loans		$	2,632,602	$	336,916	$	362,102	$	3,331,620
Commercial loans:
	Construction loans		69,810		28,564		26,066		124,440
	Commercial mortgage loans		1,309,257		68,367		271,639		1,649,263
	Commercial and Industrial loans		2,018,229		125,389		299,249		2,442,867
Commercial loans			3,397,296		222,320		596,954		4,216,570
Finance leases			230,183		-		-		230,183
Consumer loans			1,621,126		47,273		38,600		1,706,999
Loans held for investment			7,881,207		606,509		997,656		9,485,372
Loans held for sale			40,284		40,314		1,125		81,723
	Total loans	$	7,921,491	$	646,823	$	998,781	$	9,567,095
(In thousands)		As of December 31, 2014
		Puerto Rico		Virgin Islands		United States		Consolidated
Residential mortgage loans		$	2,325,455	$	341,098	$	344,634	$	3,011,187
Commercial loans:
	Construction loans		70,618		30,011		22,851		123,480
	Commercial mortgage loans		1,305,057		69,629		291,101		1,665,787
	Commercial and Industrial loans		2,072,265		120,947		286,225		2,479,437
Commercial loans			3,447,940		220,587		600,177		4,268,704
Finance leases			232,126		-		-		232,126
Consumer loans			1,666,373		47,811		36,235		1,750,419
Loans held for investment			7,671,894		609,496		981,046		9,262,436
Loans held for sale			34,972		40,317		1,667		76,956
	Total loans	$	7,706,866	$	649,813	$	982,713	$	9,339,392

Table 9 – Non-Performing Assets

(Dollars in thousands)		June 30,			March 31,			December 31,
		2015			2015			2014
Non-performing loans held for investment:
	Residential mortgage	$	175,035		$	172,583		$	180,707
	Commercial mortgage		95,088			142,385			148,473
	Commercial and Industrial		143,935			186,500			122,547
	Construction		16,118			27,163			29,354
	Consumer and Finance leases		33,397			34,913			42,815
	Total non-performing loans held for investment		463,573			563,544			523,896
OREO			122,129			122,628			124,003
Other repossessed property			10,706			13,585			14,229
	Total non-performing assets, excluding loans held for sale	$	596,408		$	699,757		$	662,128
Non-performing loans held for sale			48,032			54,588			54,641
	Total non-performing assets, including loans held for sale (1)	$	644,440		$	754,345		$	716,769
Past-due loans 90 days and still accruing (2)		$	196,547		$	178,572		$	162,887
Allowance for loan and lease losses		$	221,518		$	226,064		$	222,395
Allowance to total non-performing loans held for investment			47.79	%		40.11	%		42.45	%
Allowance to total non-performing loans held for investment, excluding residential real estate loans			76.77	%		57.82	%		64.80	%
(1)	Purchased credit impaired loans of $178.5 million accounted for under ASC 310-30 as of June 30, 2015, primarily mortgage loans acquired from Doral in the first quarter of 2015 and second quarter of 2014, are excluded and not considered non-performing due to the application of the accretion method, under which these loans will accrete interest income over the remaining life of the loans using estimated cash flow analysis.
(2)	Amount includes purchased credit impaired loans with individual delinquencies over 90 days and still accruing with a carrying value as of June 30, 2015 of approximately $18.2 million, primarily related to loans acquired from Doral in the first quarter of 2015 and second quarter of 2014.

Table 10– Non-Performing Assets by Geography

(In thousands)		June 30,		March 31,		December 31,
		2015		2015		2014
Puerto Rico:
Non-performing loans held for investment:
	Residential mortgage	$	154,446	$	149,156	$	156,361
	Commercial mortgage		77,436		120,770		121,879
	Commercial and Industrial		138,481		180,793		116,301
	Construction		12,398		23,269		24,526
	Finance leases		3,257		2,979		5,245
	Consumer		28,247		30,003		35,286
	Total non-performing loans held for investment		414,265		506,970		459,598
OREO			110,551		110,378		111,041
Other repossessed property			10,653		13,520		14,150
	Total non-performing assets, excluding loans held for sale	$	535,469	$	630,868	$	584,789
Non-performing loans held for sale			8,027		14,583		14,636
	Total non-performing assets, including loans held for sale (1)	$	543,496	$	645,451	$	599,425
Past-due loans 90 days and still accruing (2)		$	189,619	$	176,361	$	154,375
Virgin Islands:
Non-performing loans held for investment:
	Residential mortgage	$	14,265	$	16,522	$	15,483
	Commercial mortgage		10,642		12,909		11,770
	Commercial and Industrial		5,454		5,707		6,246
	Construction		3,565		3,738		4,064
	Consumer		531		549		887
	Total non-performing loans held for investment		34,457		39,425		38,450
OREO			6,152		6,064		6,967
Other repossessed property			17		30		22
	Total non-performing assets, excluding loans held for sale	$	40,626	$	45,519	$	45,439
Non-performing loans held for sale			40,005		40,005		40,005
	Total non-performing assets, including loans held for sale	$	80,631	$	85,524	$	85,444
Past-due loans 90 days and still accruing		$	6,303	$	2,004	$	5,281
United States:
Non-performing loans held for investment:
	Residential mortgage	$	6,324	$	6,905	$	8,863
	Commercial mortgage		7,010		8,706		14,824
	Commercial and Industrial		-		-		-
	Construction		155		156		764
	Consumer		1,362		1,382		1,397
	Total non-performing loans held for investment		14,851		17,149		25,848
OREO			5,426		6,186		5,995
Other repossessed property			36		35		57
	Total non-performing assets, excluding loans held for sale	$	20,313	$	23,370	$	31,900
Non-performing loans held for sale			-		-		-
	Total non-performing assets, including loans held for sale	$	20,313	$	23,370	$	31,900
Past-due loans 90 days and still accruing		$	625	$	207	$	3,231
(1)	Purchased credit impaired loans of $178.5 million accounted for under ASC 310-30 as of June 30, 2015, primarily mortgage loans acquired from Doral in the first quarter of 2015 and second quarter of 2014, are excluded and not considered non-performing due to the application of the accretion method, under which these loans will accrete interest income over the remaining life of the loans using estimated cash flow analysis.
(2)	Amount includes purchased credit impaired loans with individual delinquencies over 90 days and still accruing with a carrying value as of June 30, 2015 of approximately $18.2 million, primarily related to loans acquired from Doral in the first quarter of 2015 and second quarter of 2014.

Table 11 – Allowance for Loan and Lease Losses

	Quarter Ended											Year Ended
(Dollars in thousands)	June 30,				March 31,			June 30,				June 30,				June 30,
	2015				2015			2014				2015				2014
Allowance for loan and lease losses, beginning of period	$	226,064			$	222,395		$	266,778			$	222,395			$	285,858
Provision for loan and lease losses		74,266		(1)		32,970			26,744		(6)		107,236		(1)		58,659		(6)
Net (charge-offs) recoveries of loans:
Residential mortgage		(3,257	)			(5,094	)		(4,687	)			(8,351	)			(11,040	)
Commercial mortgage		(41,665	)	(2)		(3,730	)		(9,126	)			(45,395	)	(2)		(14,901	)
Commercial and Industrial		(20,417	)	(3)		(3,895	)		(19,036	)	(7)		(24,312	)	(3)		(40,832	)	(7)
Construction		(2,083	)	(4)		(398	)		(2,606	)			(2,481	)	(4)		(2,959	)
Consumer and finance leases		(11,390	)			(16,184	)		(16,890	)			(27,574	)			(33,608	)
Net charge-offs		(78,812	)	(5)		(29,301	)		(52,345	)	(7)		(108,113	)	(5)		(103,340	)	(7)
Allowance for loan and lease losses, end of period	$	221,518			$	226,064		$	241,177			$	221,518			$	241,177
Allowance for loan and lease losses to period end total loans
held for investment		2.40	%			2.38	%		2.55	%			2.40	%			2.55	%
Net charge-offs (annualized) to average loans outstanding
during the period		3.35	%			1.25	%		2.19	%			2.30	%			2.15	%
Net charge-offs (annualized), excluding charge-offs of $61.4
million related to the bulk sale of assets in the second
quarter of 2015 and $6.9 million related to the acquisition
of mortgage loans from Doral in the second quarter of 2014,
to average loans outstanding during the period		0.75	%			1.25	%		1.90	%			1.01	%			2.01	%
Provision for loan and lease losses to net charge-offs during	0.94x				1.13x			0.51x				0.99x				0.57x
the period
Provision for loan and lease losses to net charge-offs during	1.57x				1.13x			0.56x				1.29x				0.59x
the period, excluding impact of the bulk sale of assets in
the second quarter of 2015 and the acquisition of mortgage
loans from Doral in the second quarter of 2014
(1) Includes provision of $46.9 million associated with the bulk sale of assets.
(2) Includes net charge-offs totaling $37.6 million associated with the bulk sale of assets.
(3) Includes net charge-offs totaling $20.6 million associated with the bulk sale of assets.
(4) Includes net charge-offs totaling $3.3 million associated with the bulk sale of assets.
(5) Includes net charge-offs totaling $61.4 million associated with the bulk sale of assets.
(6) Includes a provision of $1.4 million associated with the acquisition of mortgage loans from Doral.
(7) Includes net charge-offs totaling $6.9 million associated with the acquisition of mortgage loans from Doral.

Table 12 – Net Charge-Offs to Average Loans

	Six-Month Period ended		Year Ended
	June 30, 2015		December 31,		December 31,		December 31,		December 31,
	(annualized)		2014		2013		2012		2011
Residential mortgage	0.52%		0.85%		4.77%	(7)	1.32	%	1.32	%
Commercial mortgage	5.55%	(1)	0.84%		3.44%	(8)	1.41	%	3.21	%
Commercial and Industrial	2.00%	(2)	2.13%	(5)	3.52%	(9)	1.21	%	1.57	%
Construction	2.90%	(3)	2.76%		15.11%	(10)	10.49	%	16.33	%
Consumer and finance leases	2.85%		3.46%		2.76%		1.92	%	2.33	%
Total loans	2.30%	(4)	1.81%	(6)	4.01%	(11)	1.74	%	2.68	%
(1) Includes net charge-offs totaling $37.6 million associated with the bulk sale of assets. The ratio of commercial mortgage net charge-offs to average loans, excluding charge-offs associated with the bulk sale of assets, was 1.00%.
(2) Includes net charge-offs totaling $20.6 million associated with the bulk sale of assets. The ratio of commercial and industrial net charge-offs to average loans, excluding charge-offs associated with the bulk sale of assets, was 0.31%.
(3) Includes net charge-offs totaling $3.3 million associated with the bulk sale of assets. The ratio of construction net charge-offs to average loans, excluding charge-offs associated with the bulk sale of assets, was (0.98)%.
(4) Includes net charge-offs totaling $61.4 million associated with the bulk sale of assets. The ratio of total charge-offs to average loans, excluding charge-offs associated with the bulk sale of assets, was 1.01%.
(5) Includes net charge-offs totaling $6.9 million associated with the acquisition of mortgage loans from Doral in the second quarter of 2014. The ratio of commercial and industrial net charge-offs to average loans, excluding charge-offs associated with the acquisition of mortgage loans from Doral, was 1.95%.
(6) Includes net charge-offs totaling $6.9 million associated with the acquisition of mortgage loans from Doral in the second quarter of 2014. The ratio of total net charge-offs to average loans, excluding charge-offs associated with the acquisition of mortgage loans from Doral, was 1.74%.
(7) Includes net charge-offs totaling $99.0 million associated with the bulk loan sales. The ratio of residential mortgage net charge-offs to average loans, excluding charge-offs associated with the bulk loan sales, was 1.13%.
(8) Includes net charge-offs totaling $54.6 million associated with the bulk sale of adversely classified commercial assets and the transfer of loans to held for sale in the first quarter of 2013. The ratio of commercial mortgage net charge-offs to average loans, excluding charge-offs associated with the bulk sale of adversely classified commercial assets and the transfer of loans to held for sale, was 0.45%.
(9) Includes net charge-offs totaling $44.7 million associated with the bulk sale of adversely classified commercial assets. The ratio of commercial and industrial net charge-offs to average loans, excluding charge-offs associated with the bulk sale of adversely classified commercial assets, was 2.04%.
(10) Includes net charge-offs totaling $34.2 million associated with the bulk loan sales and the transfer of loans to held for sale. The ratio of construction loan net charge-offs to average loans, excluding charge-offs associated with the bulk loan sales and the transfer of loans to held for sale, was 2.91%.
(11) Includes net charge-offs totaling $232.4 million associated with the bulk loan sales and the transfer of loans to held for sale. The ratio of total net charge-offs to average loans, excluding charge-offs associated with the bulk loan sales and the transfer of loans to held for sale, was 1.68%.

CONTACT:
First BanCorp.
John B. Pelling III, 305-577-6000 Ext. 162
Investor Relations Officer
john.pelling@firstbankpr.com

EX-99.2

Exhibit 99.2

Financial Results 2Q 2015

Forward-Looking Statements This presentation contains “forward-looking statements” concerning First BanCorp’s (the “Corporation”) future economic performance. The words or phrases “would be,” “will allow,” “intends to,” “will likely result,” “are expected to,” “expect,” “anticipate,” “look forward,” “should,” “believes” and similar expressions are meant to identify “forward-looking statements” within the meaning of Section 27A of the Private Securities Litigation Reform Act of 1995, and are subject to the safe harbor created by such section. The Corporation wishes to caution readers not to place undue reliance on any such “forward-looking statements,” which speak only as of the date made, and to advise readers that various factors, including, but not limited to, uncertainty about whether the Corporation and FirstBank Puerto Rico (“FirstBank” or “the Bank”) will be able to fully comply with the written agreement dated June 3, 2010 that the Corporation entered into with the Federal Reserve Bank of New York (the “FED”) and the order dated June 2, 2010 (the “Order”)that FirstBank entered into with the FDIC and the Office of the Commissioner of Financial Institutions of Puerto Rico that, among other things, require FirstBank to maintain certain capital levels and reduce its special mention, classified, delinquent and non-performing assets; the risk of being subject to possible additional regulatory actions; uncertainty as to the availability of certain funding sources, such as retail brokered CDs; the Corporation’s reliance on brokered CDs and its ability to obtain, on a periodic basis, approval from the FDIC to issue brokered CDs to fund operations and provide liquidity in accordance with the terms of the Order; the risk of not being able to fulfill the Corporation’s cash obligations or resume paying dividends to the Corporation’s stockholders in the future due to the Corporation’s inability to receive approval from the FED to receive dividends from FirstBank or FirstBank’s failure to generate sufficient cash flow to make a dividend payment to the Corporation; the strength or weakness of the real estate markets and of the consumer and commercial credit sectors and their impact on the credit quality of the Corporation’s loans and other assets, including the Corporation’s construction and commercial real estate loan portfolios, which have contributed and may continue to contribute to, among other things, the high levels of non-performing assets, charge-offs and the provision expense and may subject the Corporation to further risk from loan defaults and foreclosures; adverse changes in general economic conditions in the United States and in Puerto Rico, including the interest rate scenario, market liquidity, housing absorption rates, real estate prices and disruptions in the U.S. capital markets, which may reduce interest margins, impact funding sources and affect demand for all of the Corporation’s products and services and the value of the Corporation’s assets; an adverse change in the Corporation’s ability to attract new clients and retain existing ones; a decrease in demand for the Corporation’s products and services and lower revenues and earnings because of the continued recession in Puerto Rico and the current fiscal problems and budget deficit of the Puerto Rico government; uncertainty about regulatory and legislative changes for financial services companies in Puerto Rico, the United States and the U.S. and British Virgin Islands, which could affect the Corporation’s financial performance and could cause the Corporation’s actual results for future periods to differ materially from prior results and anticipated or projected results; uncertainty about the effectiveness of the various actions undertaken to stimulate the United States economy and stabilize the United States’ financial markets, and the impact such actions may have on the Corporation’s business, financial condition and results of operations; changes in the fiscal and monetary policies and regulations of the federal government, including those determined by the Federal Reserve System, the FDIC, government-sponsored housing agencies and regulators in Puerto Rico and the U.S. and British Virgin Islands; the risk of possible failure or circumvention of controls and procedures and the risk that the Corporation’s risk management policies may not be adequate; the risk that the FDIC may further increase the deposit insurance premium and/or require special assessments to replenish its insurance fund, causing an additional increase in the Corporation’s non-interest expense; risks of not being able to recover the assets pledged to Lehman Brothers Special Financing, Inc.; the impact on the Corporation’s results of operations and financial condition associated with acquisitions and dispositions; a need to recognize additional impairments on financial instruments or goodwill relating to acquisitions; risks that downgrades in the credit ratings of the Corporation’s long-term senior debt will adversely affect the Corporation’s ability to access necessary external funds; the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act on the Corporation’s businesses, business practices and cost of operations; and general competitive factors and industry consolidation. The Corporation does not undertake, and specifically disclaims any obligation, to update any “forward-looking statements” to reflect occurrences or unanticipated events or circumstances after the date of such statements except as required by the federal securities laws. Investors should refer to the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2013 for a discussion of such factors and certain risks and uncertainties to which the Corporation is subject.2

Agenda Second Quarter 2015 Highlights Aurelio Alemán, President & Chief Executive Officer Second Quarter 2015 Results of Operations Orlando Berges, Executive Vice President & Chief Financial Officer Questions & Answers 3

Key Highlights 4

Several important events, which were previously reported to the market, occurred in 2Q 2015: On April 29, 2015, the FDIC notified FirstBank that the Consent Order, which had been in place since June 2010, was terminated. On May 26, 2015, First BanCorp announced progress on balance sheet de-risking with the sale of $150.1 million of classified assets for $87.6 million in cash resulting in a pre-tax loss net of $47.2 million. On June 25, 2015, First BanCorp released its 2015 Dodd-Frank Act Stress Testing Results which show that even in a severely adverse economic environment capital ratios exceed both the regulatory minimum required ratios mandated under Basel III and the well-capitalized thresholds throughout the nine-quarter time horizon. During the second quarter, First BanCorp successfully integrated and rebranded the Doral branches acquired in 1Q 2015. First BanCorp continues to focus efforts on our strategic plan, despite increased challenges in our market. Second Quarter 2015 Highlights 5

Profitability Net loss of $34.1 million, or $0.16 per diluted share, which included the $48.7 million pre-tax loss on the bulk sale transaction, as well as an $13 million OTTI on Puerto Rico Government securities and approximately $3 million in costs relating to conversion of loan and deposit accounts from Doral Bank. Adjusted pre-tax income for 2Q 2015 was $20.2 million compared to adjusted pre-tax income of $22.3 million for 1Q 2015. During 2Q 2015 net interest margin remained flat at 4.18%. Asset Quality Total NPAs declined by $109.9 million, or 15%. This decline was primarily attributable to the bulk sale transaction completed during the quarter. Inflows to nonperforming were down 62% at $44.9 million, compared to $118.7 million in 1Q 2015. Provision for loan and lease losses increased to $74.3 million primarily attributable to a $46.9 million increase associated with the bulk sale. Core Deposits Deposits, net of government and brokered, decreased by $138.5 million to $6.7 billion. Cost of deposits, excluding brokered, declined to the lowest level at 0.61%. Brokered certificates of deposit (CDs) decreased by $241.7 million in 2Q 2015. Capital 2Q 2015 capital position, under Basel III rules: Total Risk Based Capital Ratio of 19.4%; Tier 1 Ratio Risk Based Capital Ratio of 16.4%; and Leverage Ratio of 11.9%. Book value per common share of $7.60 compared to $7.81 in 1Q 2015. Tangible book value per common share of $7.35 compared to $7.55 in 1Q 2015. 6

Loan Portfolio ($ millions) 2,795 2,820 3,011 3,332 3,328 2,062 2,027 1,983 1,937 1,899 148 142 123 124 121 4,461 4,327 4,145 4,092 3,870 72 80 77 82 80 2Q 2014 3Q 2014 4Q 2014 1Q 2015 2Q 2015$9,538 $9,396 $9,339 $9,567 161 169 154 153 197 272 245 235 221 235 7 7 12 9 14 442 496 490 398 394 2Q 2014 3Q 2014 4Q 2014 1Q 2015 2Q 2015$882 $917 $891 $777 Residential Mortgage Consumer & Finance Leases Construction Commercial Loans HFS Residential mortgage portfolio has grown following acquisition of competitor. Reduction in the loan portfolio primarily driven by de-risking strategies, specifically the bulk sale transaction in 2Q 2015. Focus remains on growth opportunities within our markets. Increased distribution channels are benefiting our residential and consumer origination volume. Florida continues to drive origination volume with $65 million in commercial origination in 2Q 2015. The commercial new business pipelines for Puerto Rico remains stable while 7

Core Deposits* ($ millions) 2,812 2,814 2,841 3,203 3,139 1,174 1,246 1,263 1,390 1,346 2,108 2,111 2,092 2,225 2,195 440 469 401 451 494 2Q 2014 3Q 2014 4Q 2014 1Q 2015 2Q 2015 * Core deposits are total deposits excluding brokered CDs. $6,534 $6,640 $6,597 $7,269 Total Deposit Composition(%) Interest Bearing 62% Non-Interest Bearing 13% Brokered CDs 25% Non-brokered deposits, excluding government deposits, decreased $138.5 million. The Florida region accounted for $103.9 million of the decline. YTD Puerto Rico core deposits, excluding the Doral acquisition, grew approximately $270 million. Focus on deposit pricing has improved cost of deposits, net of brokered, which declined to 0.61%. Government deposits increased $43.7million in 2Q 2015. Continue to reduce reliance on brokered deposits which declined of $241.7 million compared to 1Q 2015. 8

9 Second Quarter 2015 Highlights: PR GOVERNMENT EXPOSURE Total outstanding exposure to the Puerto Rico Government was $392 million with a book value of $378 million as of June 30, 2015. Investment portfolio outstanding principle of $65.5 million, being carried on books at $34.6 million. Loan exposure is diversified among all sectors with the largest public company exposure to PREPA on nonaccrual status. PREPA UPB of $75.0 million. Largest government exposure to municipalities supported by assigned tax revenues. In addition, there is $131 million of indirect exposure to the Tourism Development Fund supporting hotel projects. Total Government Deposits as of June 30, 2015 were $327 million. Time deposits $22.6 million compared to $17.6 million in 1Q 2015. Transaction accounts $304.1 million compared to $265.2 million in 1Q 2015. ($ in millions) Government UnitTime DepositsTransaction AccountsTotalMunicipalities21.5$ 154.0$ 175.5$ Public Agencies1.1 149.8 150.9 Public Corporations- 0.3 0.3 Total Deposits22.6$ 304.1$ 326.7$ Investment Portfolio52.7$ Central Government:23.3$ 2 loans16.37.0Public Corporations:98.1$ 3 loans74.1CRE - Operating Revenues20.13.9Municipalities:204.3$ 10 loans204.3Total Direct Government Exposure378.4$ Government UnitSource of RepaymentTotal OutstandingProperty Tax RevenuesCommonwealth AppropriationsCRE & Commonwealth AppropriationsPREPA Fuel LineRental Income

Results of Operations 10

Results of Operations: SECOND QUARTER FINANCIAL HIGHLIGHTS ($ in thousands, except per share data) Select Financial Information 2Q 20151Q 2015Variance2Q 2014Interest income151,632$ 152,485$ (854)$ 158,423$ Interest expense25,155 26,838 (1,682) 28,516 Net interest income126,477 125,647 830 129,907 Provision for loan and lease losses74,266 32,970 41,296 26,744 Non-interest income19,767 19,442 325 16,310 Loss on investments & impairments(13,097) (156) (12,941) 291 Bargain purchase gain- 13,443 (13,443) - Equity in losses of unconsolidated entities- - - (670) Total non-interest income6,670 32,729 (26,059) 15,931 Personnel expense37,945 35,654 2,291 34,793 Occupancy and equipment expense15,059 14,349 710 14,482 Insurance and supervisory fees6,796 6,860 (64) 10,784 REO expense4,874 2,628 2,246 6,778 Other operating expenses38,125 32,238 5,887 31,308 Total non-interest expense102,799 91,729 11,070 98,145 Pre-tax income (loss)(43,918) 33,678 (77,595) 20,949 Income tax expense (benefit)(9,844) 8,032 (17,876) (276) Net income (loss)(34,075)$ 25,645$ (59,720)$ 21,225$ Select Financial InformationAdjusted Pre-tax, pre-provision income47,727$ 55,445$ (7,718)$ 48,622$ Fully diluted EPS(0.16)$ 0.12$ (0.28)$ 0.11$ Book value per share7.60$ 7.81$ (0.21)$ 5.97$ Tangible book value per share7.35$ 7.55$ (0.20)$ 5.72$ Common stock price4.82$ 6.20$ (1.38)$ 5.44$ Net Interest Margin (GAAP)4.18%4.18%0.00%4.20%Efficiency ratio77.2%57.9%19.3%67.3% 11

12 Results of Operations: SECOND QUARTER FINANCIAL HIGHLIGHTS ($ in millions) $2.4 million of interim servicing costs were paid in 2Q 2015 through the conversion date. The estimated internal costs for the corresponding services are approximately $0.8 million, or approximately $0.4 million a month. During 1Q 2015 the interim servicing costs were $1.2 million. $1.3 million in consulting and legal fees expenses for special projects, as well as strategic, stress testing and capital planning not expected to be incurred on an ongoing basis. * Amount is presented net of normal processing costs. 2Q 20151Q 2015Pre-tax income (loss), as reported(43.9)$ 33.7$ Significant unusual items: Loss on bulk sale of assets48.7 - Other than temporary impairment charge12.9 - Acquisition and conversion costs2.6 2.1 Bargain purchase gain- (13.4) Adjusted pre-tax income, as reported20.2 22.3 Other estimated non-recurring amounts: Excess interim servicing costs *1.6 0.8 Other professional fees1.3 - Non-GAAP pre-tax income23.0$ 23.1$

13 Key Highlights Net Interest Income ($ millions) $129.9 $127.7 $129.2 $125.6 $126.5 4.21% 4.14% 4.18% 4.18% 4.18% 2Q 2014 3Q 2014 4Q 2014 1Q 2015 2Q 2015 Net Interest Income ($) Net Interest Margin (GAAP %) Net interest income increased $0.9 million in 2Q 2015. This increase was mainly due to: A $2.8 million increase in interest income on residential mortgages primarily due to the acquisition of Doral Bank; and A $1.7 million decline in interest expense and funding costs. This increase was partially offset by: A $1.6 million decrease in interest income on securities due to accelerated prepayment speeds; A $1.5 million decline in interest income on commercial loans attributable to $127 million decline in average volume, including accruing loans sold as part of the bulk sale of assets; and A $0.8 million decrease in interest income on consumer loans due to a $44 million decline in average volumes. GAAP NIM was flat quarter-over-quarter. Results of Operations: NET INTEREST INCOME

14 Key Highlights Cost of Deposits (%) 0.82% 0.83% 0.81% 0.77% 0.73% 0.72% 0.72% 0.70% 0.66% 0.61% 0.50% 0.60% 0.70% 0.80% 0.90% 2Q 2014 3Q 2014 4Q 2014 1Q 2015 2Q 2015 Interest Bearing Deposits (%) Total Deposits (%) Cost of total deposits, excluding brokered CDs, declined to 0.61%. The average rate paid on non-brokered interest-bearing deposits declined by 4 basis points to 0.73% during the first quarter. Brokered CDs declined by $241.7 million during the second quarter of 2015. Results of Operations: COST OF FUNDS

Non-Interest Income* ($ millions) 4.2 4.2 4.2 4.6 5.2 3.0 3.8 4.5 3.6 4.8 9.3 8.2 9.3 11.1 10.1 2Q 2014 3Q 2014 4Q 2014 1Q 2015 2Q 2015 Other Mortgage Banking Service Charges on Deposits * Non interest income excludes equity losses of unconsolidated entities, OTTI, HFS bulk sale impact and bargain purchase gain. Excluding the $12.9 million OTTI charge on Puerto Rico Government debt securities and the $0.6 million pre-tax loss on a commercial loan HFS and sold in the bulk sale, adjusted non-interest income increased $0.8 million compared to 1Q 2015, due to: A $1.2 million increase in revenues on mortgage banking; A $0.6 million increase in service charges on deposits and $0.3 million increase in other fees related to deposits assumed from Doral Bank. This increase was partially offset by $1.5 million decrease in seasonal contingent insurance commissions recognized in 1Q 15

Results of Operations: OPERATING EXPENSES A $2.3 million increase in credit related expenses driven by higher write-downs to commercial OREO properties in Puerto Rico. A $2.2 million increase in compensation and benefit expenses mainly due to salary merit increases that became effective early in the second quarter and the full quarter impact of personnel costs related to branches acquired from Doral Bank. A $0.8 million increase in adjusted occupancy and equipment costs primarily related to the full quarter impact of rental, depreciation and maintenance expenses associated with the acquired Doral Bank branches. A $1.0 million increase in adjusted business promotion expenses, primarily related to seasonal marketing campaigns. Interim servicing costs of $2.4 million and $1.2 million were paid in the 2Q 2015 and 1Q 2015 respectively, through final conversion in May. Assuming normal internal processing costs, these amounts would have been approximately $0.8 million in 2Q 2015 and $0.4 million in 1Q 2015. $1.3 million in consulting and legal fees expenses for special projects, as well as strategic, stress testing and capital planning not expected to be incurred on an ongoing basis. ($ in millions)2Q 20151Q 2015% ChangeCredit related expenses8.4$ 6.1$ 39%Compensation & benefits37.8 35.7 6%Occupancy & equipment15.1 14.2 6%Credit & debit card processing expenses3.9 4.0 0%Taxes other than income3.1 3.0 4%Other professional fees4.7 4.5 4%Deposit insurance prem & supervisory6.8 6.9 -1%Business promotion3.7 2.7 35%All other expenses12.7 11.8 7%Non-GAAP operating expenses96.2$ 88.8$ 8%Doral acquisition & conversion2.6 2.1 23%Excess interim servicing costs - Doral1.6 0.8 89%Other professional fees1.3 - Bulk sale of assets & related loss on OREO1.2 - Total operating expenses, as reported102.8$ 91.7$ 12% 16

17 Non-Performing Assets ($ millions) 1,639 1,551 1,506 1,239 1,233 1,208 1,184 1,138 1,119 1,066 1,008 976 683 506 498 496 522 565 560 524 564 464 150 150 163 163 172 176 188 194 213 242 251 260 256 151 147 175 154 138 130 138 136 133 159 148 95 80 55 55 55 55 55 55 48 9.5% 10.0% 9.3% 10.2% 10.2% 9.6% 8.4% 5.7% 5.7% 5.9% 5.7% 5.1% Loans HFI Repossessed Assets & Other $1,790 $754 - 64% Total non-performing loans, including non-performing loans held for sale, decreased by $107 million, or 17%. NPAs declined $110 million in 2Q 2015. New non-performing loan inflows amounted to $44.9 million, or a 62% decrease, compared to inflows of $118.7 million in 1Q 2015 that included the migration of the $75.0 million credit facility with PREPA. NPAs decreased by $110 million to $644 million, driven by the bulk sale transaction: Results of Operations: ASSET QUALITY Q-o-Q Change in NPAs Migration Trend ($ millions) $644 Loan2Q1Q$%Portfolio20152015ChangeChangeResidential$175$173$21%Consumer$33$35($2)(4%)C&I and CRE$239$329($90)(27%)Construction$16$27($11)(41%)Loans HFS$48$55($7)(12%)Total NPLs$512$618($107)(17%)REO & Repo$133$136($3)(2%)Total NPAs$644$754($110)(15%)Loan2Q1Q$%Portfolio20152015ChangeChangeResidential$25$19$630%Consumer$13$14($1)(7%)$7$85($79)(92%)$45$119($74)(62%)Commercial & ConstructionTotal Migration

18 Key Highlights Net Charge-Offs ($ millions) 6 5 17 18 19 16 11 28 15 8 62 2Q 2014 3Q 2014 4Q 2014 1Q 2015 2Q 2015 Residential Consumer Commercial Construction Total net charge-offs for 2Q 2015 were $79 million, or 3.35% of average loans, compared to $29 million in 1Q 2015. Excluding the impact of charge-offs related to the bulk sale, total net charge-offs in 2Q 2015 were $17.4 million, or an annualized 0.75% of average loans, compared to $29.3 million, or 1.25%, in 1Q 2015. Allowance coverage ratio of 2.40% as of June 30, 2015 compared to 2.38% as of March 31, 2015. Loan Portfolio Book Value Accumulated NCOs Reserves NCA* C&I $143.9 $37.3 $13.1 72.2% Const. 63.9 93.4 2.1 39.3% CRE 95.3 18.6 7.6 77.0% Total $303.2 $149.3 $22.9 62.0% $52 $43 $27 $29 Commercial NPLs (Includes HFS) *Net Carrying Amount = % of unpaid principal balance net of reserves and accumulated charge-offs. Results of Operations: NET CHARGE-OFFS $79

19 Results of Operations: CAPITAL POSITION Capital Ratios (%) Total stockholders’ equity amounted to $1.7 billion as of June 30, 2015, a decrease of $37.5 million from March 31, 2015, mainly driven by the net loss of $34.1 million and a decrease of $10.2 million in other comprehensive income due to the fair value of U.S. agency MBS, offset by $5.3 million of trust preferred securities exchanged for common stock during the second quarter. DFAST results were disclosed in 2Q 2015 and even in the severely adverse scenario, all capital ratios exceed well-capitalized thresholds throughout the nine-quarter time horizon. Capital Ratios (%) 19.4% 11.9% 16.4% 12.6% 2Q 2014 3Q 2014 4Q 2014 1Q 2015 2Q 2015 Total Risk-Based Capital Tier-1 Leverage Tier-1 Common Tangible Common

20 Capital Ratios (%) Exceptional track record executing plan during challenging economic cycle: Raised capital, de-risked balance sheet and improved and expanded core deposit franchise. Enhanced diversification over three geographic markets. Improved competitive position to continue execution under challenging times. Strong DFAST results and stronger capital position. Stronger Franchise: PROVEN SUCCESS IMPLEMENTING STRATEGIC PLAN De-Risking of Balance Sheet Capital Enhanced Franchise Value ($ in millions) Our franchise has never been stronger and is poised to increase shareholder value. FYE 20092Q 2015Change ('09-'15)% improvementNPAs$1,711$644$1,06762%NPAs/assets8.7%5.1%359 bpsGovernment exposure$1,364$379$98572%Tier 1 Common Ratio4.1%16.4%1230 bpsTCE / TA3.2%12.6%939 bpsCore deposits$5,108$7,174$2,06640%Brokered deposits$7,561$2,331$5,23069%NIM2.69%4.18%149 bps

Q & A 21

Exhibits 22

23 Results of Operations: KEY MARGIN DRIVERS Q2 vs. Q1 Change in Average Interest Earning Assets & Interest Bearing Liabilities * On a tax equivalent basis and excluding valuations $ Δ in % Δ in AverageAverageVolumeRateAverage total investments(70,779)$ (0.25%)(1,948)$ Average loans & leases:Residential mortgage loans200,621 (0.06%)2,834 Construction loans(2,165) 0.09%34 C&I and commercial mortgage loans(125,039) (0.20%)(2,838) Finance leases(1,550) (0.22%)(104) Consumer loans(42,205) (0.00%)(648) Total average loans29,662 (0.12%)(722) Average total interest-earning assets(41,117) (0.13%)(2,670) Interest-bearing liabilities:Brokered CDs(298,716) 0.01%571 Other interest-bearing deposits185,939 (0.04%)143 Other borrowed funds(160,765) 0.05%979 Average total interest-bearing liabilities(273,542) (0.05%)1,683 Increase (decrease) in net interest income *(987)$ Net InterestIncomeChanges

24 Results of Operations: MIGRATION Residential MortgageCommercial MortgageCommercial & IndustrialConstructionConsumerTotalBeginning balance172,583$ 142,385$ 186,500$ 27,163$ 34,914$ 563,545$ Plus: Additions to non-performing25,058 3,902 2,576 280 13,070 44,886 Less: Non-performing loans transferred to OREO(5,630) (6,826) (513) (120) (556) (13,644) Non-performing loans charged-off(2,388) (2,777) (647) - (8,759) (14,571) Loans returned to accrual status / collections(14,588) (7,253) (4,061) (151) (5,271) (31,324) Bulk sale transaction- (34,343) (39,921) (11,054) - (85,318) Ending balance175,035$ 95,088$ 143,935$ 16,118$ 33,398$ 463,574$ Residential MortgageCommercial MortgageCommercial & IndustrialConstructionConsumerTotalBeginning balance180,707$ 148,473$ 122,547$ 29,354$ 42,815$ 523,896$ Plus: Additions to non-performing19,213 5,802 79,503 128 14,079 118,725 Less: Non-performing loans transferred to OREO(5,048) - (4,866) (265) - (10,179) Non-performing loans charged-off(5,073) (3,970) (4,304) (605) (13,815) (27,767) Loans returned to accrual status / collections(17,216) (7,920) (6,380) (1,449) (8,165) (41,130) Ending balance172,583$ 142,385$ 186,500$ 27,163$ 34,914$ 563,545$ March 31, 2015June 30, 2015

25 Use of Non-GAAP Financial Measures Basis of Presentation Use of Non-GAAP Financial Measures This presentation may contain non-GAAP financial measures. Non-GAAP financial measures are set forth when management believes they will be helpful to an understanding of the Corporation’s results of operations or financial position. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the text or in the attached tables to the earnings release. Tangible Common Equity Ratio and Tangible Book Value per Common Share The tangible common equity ratio and tangible book value per common share are non-GAAP financial measures generally used by the financial community to evaluate capital adequacy. Tangible common equity is total equity less preferred equity, goodwill, core deposit intangibles, and other intangibles, such as the purchased credit card relationship intangible. Tangible assets are total assets less goodwill, core deposit intangibles, and other intangibles, such as the purchased credit card relationship intangible. Management and many stock analysts use the tangible common equity ratio and tangible book value per common share in conjunction with more traditional bank capital ratios to compare the capital adequacy of banking organizations with significant amounts of goodwill or other intangible assets, typically stemming from the use of the purchase method of accounting for mergers and acquisitions. Neither tangible common equity nor tangible assets, or the related measures should be considered in isolation or as a substitute for stockholders’ equity, total assets, or any other measure calculated in accordance with GAAP. Moreover, the manner in which the Corporation calculates its tangible common equity, tangible assets, and any other related measures may differ from that of other companies reporting measures with similar names. (In thousands, except ratios and per share information)June 30,March 31,December 31,September 30,June 30,20152015201420142014Total equity - GAAP $ 1,668,220 $ 1,705,750 $ 1,671,743 $ 1,324,157 $ 1,306,001 Preferred equity(36,104)(36,104)(36,104)(36,104)(36,104)Goodwill(28,098)(28,098)(28,098)(28,098)(28,098)Purchased credit card relationship (14,854) (15,622) (16,389) (17,235) (18,080)Core deposit intangible(10,283)(10,914)(5,420)(5,810)(6,200)Tangible common equity $ 1,578,881 $ 1,615,012 $ 1,585,732 $ 1,236,910 $ 1,217,519 Total assets - GAAP $ 12,578,813 $ 13,147,919 $ 12,727,835 $ 12,643,280 $ 12,523,251 Goodwill(28,098)(28,098)(28,098)(28,098)(28,098)Purchased credit card relationship (14,854) (15,622) (16,389) (17,235) (18,080)Core deposit intangible (10,283)(10,914)(5,420)(5,810)(6,200)Tangible assets $ 12,525,578 $ 13,093,285 $ 12,677,928 $ 12,592,137 $ 12,470,873 Common shares outstanding 214,694 213,827 212,985 212,978 212,760 Tangible common equity ratio12.61%12.33%12.51%9.82%9.76%Tangible book value per common share7.35$ 7.55$ 7.45$ 5.81$ 5.72$ Tangible Equity:Tangible Assets:

26 Use of Non-GAAP Financial Measures Basis of PresentationUse of Non-GAAP Financial Measures This presentation may contain non-GAAP financial measures. Non-GAAP financial measures are set forth when management believes they will be helpful to an understanding of the Corporation’s results of operations or financial position. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the text or in the attached tables to the earnings release.Adjusted Pre-Tax, Pre-Provision IncomeAdjusted pre-tax, pre-provision income is a non-GAAP performance metric that management believes is useful in analyzing underlying performance trends, particularly in times of economic stress. Adjusted pre-tax, pre-provision income, as defined by management, represents net income (loss) excluding income tax expense (benefit), the provision for loan and lease losses, gains on sale and OTTI of investment securities, fair value adjustments on derivatives, equity in earnings or loss of unconsolidated entity up until the second quarter of 2014 when the value of the investment became zero as well as certain items identified as unusual, non-recurring or non-operating. In addition, from time to time, adjusted pre-tax, pre-provision income will reflect the omission of revenue or expense items that management judges to be outside of ordinary banking activities or of items that, while they may be associated with ordinary banking activities, are so unusually large that management believes that a complete analysis of the Corporation’s performance requires consideration also of adjusted pre-tax, pre-provision income that excludes such amounts. (Dollars in thousands) June 30, March 31, December 31, September 30, June 30, 2015 2015 2014 2014 2014 (Loss) income before income taxes $ (43,918) $ 33,678 $ 2 9,454 $ 23,265 $ 2 0,949 Add: Provision for loan and lease losses 74,266 32,970 23,872 26,999 26,744 Add/Less: Net loss (gain) on investments and impairments 13,097 156 172 245 (291) Less: Unrealized gain on derivative instruments - - (265) (418) (262) Less: Prepayment penalty collected on a commercial mortgage loan - - (2,546) - - Less: Bargain purchase gain on assets acquired/deposits assumed from Doral - (13,443) - - - Add: Non-recurring expenses for acquisition of loans/assumption of deposits from Doral 2 ,562 2,084 - 659 576 Add: Loss on a commercial mortgage loan held for sale and certain OREOs included in the bulk sale of assets 802 - - - - Add: Bulk sale of assets related expenses 918 - - - - Add: Branch consolidations and restructuring expenses - - - - 236 Add/Less: Equity in loss of unconsolidated entity - - - - 670 Adjusted pre-tax, pre-provision income $ 47,727 $ 55,445 $ 50,687 $ 50,750 $ 4 8,622 Change from most recent prior quarter-amount $ (7,718) $ 4 ,758 $ (63) $ 2,128 $ (8,278) Change from most recent prior quarter-percentage -13.9% 9.4% -0.1% 4.4% -14.5% Quarter Ended