8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 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): February 27, 2015

First BanCorp.

(Exact name of registrant as specified in its charter)

Puerto Rico	001-14793	66-0561882
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

1519 Ponce de Leon Ave., PO Box 9146, San Juan, Puerto Rico	00908-0146
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: 787-729-8200

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))

Item 1.01 Entry into a Material Definitive Agreement.

On February 27, 2015, pursuant to a Purchase and Assumption Agreement (the “Purchase and Assumption Agreement”), dated as of February 18, 2015, among Banco Popular de Puerto Rico (“BPPR”), as seller, and FirstBank Puerto Rico (“FirstBank”), the wholly owned subsidiary of First BanCorp (the “Corporation”), as purchaser, FirstBank participated in the acquisition of Doral Bank (“Doral”) in alliance with BPPR.

In this regard, on February 27, 2015, BPPR purchased, in alliance with co-bidders, including FirstBank, certain assets and all deposits (other than brokered deposits) of Doral from the Federal Deposit Insurance Corporation (“FDIC”) as receiver. In connection with such purchase by BPPR and pursuant to the Purchase and Assumption Agreement, FirstBank purchased from BPPR ten (10) branch offices of Doral located within the Commonwealth of Puerto Rico (Aguadilla, Bayamón Plaza del Parque, Bayamón Santa Rosa, Las Catalinas, Isla Verde, Humacao, Mayagüez Western Plaza, Los Paseos, Condado, and Vega Baja) and approximately $325 million in residential mortgage loans. In addition, in connection with the acquired branches, FirstBank assumed approximately $625 million in deposits which are insured by the Deposit Insurance Fund of the FDIC. Pursuant to the terms of the Purchase and Assumption Agreement, FirstBank purchased the loans at an aggregate discount of 9.0% or approximately $29 million, and assumed the deposits at a premium of 1.6%, or approximately $10 million. These numbers, which are as of December 31, 2014, are subject to post-closing adjustment based on closing date totals and purchase accounting adjustments.

There is no loss-sharing arrangement with the FDIC on the assets acquired by FirstBank.

The foregoing description of the Purchase and Assumption Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Purchase and Assumption Agreement, which will be filed as an exhibit to a subsequent periodic report filed with the U.S. Securities and Exchange Commission.

Item 7.01 Regulation FD Disclosure.

The executive officers of the Corporation intend to use the materials filed herewith, in whole or in part, in one or more meetings with investors and analysts. A copy of the investor presentation is attached hereto as Exhibit 99.1.

The Corporation does not intend for this Item 7.01 or Exhibit 99.1 to be treated as “filed” under the Securities Exchange Act of 1934, as amended, or incorporated by reference into its filings under the Securities Act of 1933, as amended.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.	Description of Exhibit
99.1	First BanCorp Investor Presentation - Acquisition of Certain Assets and Assumption of Deposits of Doral Bank, dated March 2015

SIGNATURES

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

	First BanCorp.
March 4, 2015	By:	/s/ Orlando Berges
	Name:	Orlando Berges
	Title:	EVP and Chief Financial Officer

EXHIBIT INDEX

Exhibit No.	Description of Exhibit
99.1	First BanCorp Investor Presentation - Acquisition of Certain Assets and Assumption of Deposits of Doral Bank, dated March 2015

EX-99.1

First BanCorp

Investor Presentation

Acquisition of Certain Assets and Assumption of

Deposits of Doral Bank

March 2015

Exhibit 99.1

Disclaimer

1

This presentation may contain “forward-looking statements” concerning the Corporation’s future economic performance. The words or phrases “expect,” “anticipate,” “look

forward,” “should,” “believes” and similar expressions 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 and FirstBank 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 “New York Fed”) and the consent order dated June 2, 2010 that FirstBank entered into with the FDIC and the Office of the Commissioner of Financial Institutions of the

Commonwealth of Puerto Rico (the “FDIC Order”) 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 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 FDIC 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 New York Fed or the Board of Governors of the Federal Reserve System (“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 credit 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, the high levels of non-performing assets, charge-offs, and provisions and may subject the Corporation to further risk from loan

defaults and foreclosures; the ability of FirstBank to realize the benefit of the deferred tax asset; 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 may reduce interest margins, impact funding sources, and affect demand for all of the Corporation’s products and services and reduce the Corporation’s revenues,

earnings, 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, the current fiscal problems and budget deficit of the Puerto

Rico government and recent credit downgrades of the Puerto Rico government; a credit default by the Puerto Rico government or any of its public corporations or other

instrumentalities, and recent and/or future downgrades of the long-term debt ratings of the Puerto Rico government, which could adversely affect economic conditions in Puerto

Rico; the risk that any portion of the unrealized losses in the Corporation’s investment portfolio is determined to be other-than-temporary, including unrealized losses on Puerto

Rico government obligations; uncertainty about regulatory and legislative changes for financial services companies in Puerto Rico, the U.S., and 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 federal government, 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 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 expenses; the impact

on the Corporation’s results of operations and financial condition of acquisitions and dispositions, including the acquisition of ten branches previously owned by Doral Bank and

certain deposits and loans; a need to recognize additional impairments on financial instruments, goodwill, or other intangible assets relating to acquisitions; the 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; the risk of losses in the value of

investments in unconsolidated entities that the Corporation does not control; 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.

2

Transaction Overview

On February

27,

2015,

FirstBank

acquired,

certain

assets

and deposits previously owned by

Doral Bank, in a transaction managed by the FDIC, as receiver for Doral Bank.

The transaction

included

10

branches,

approximately

$625

million

in

deposits

and

a

performing

residential mortgage loan portfolio of approximately $325 million.

All necessary regulatory approvals were received prior to the transaction announcement.

3

Solidifies FirstBank’s position in Puerto Rico as the second largest banking institution.

Provides additional cross-selling opportunities with new customers.

The transaction is accretive to earnings.

Transaction Rationale

(1)

Source: PR Market Share Report prepared with data provided by the Commissioner of Financial Institutions of Puerto Rico as of  12/31/14.

Enhances FirstBank’s branch network with 10 additional branches, expanding coverage to

additional geographical areas in Puerto Rico and improving FirstBank’s December 31, 2014

deposit market share to the second largest deposit franchise on the island 

(1)

.

4

Loans acquired & deposits assumed

(1)

Transaction Overview

Total of approximately $325 million

of performing residential mortgage

loans were purchased at a 9%

discount, or 91% of book value.

The weighted average coupon on

this portfolio is 5.84%.

No non-performing assets acquired.

No loss-sharing agreement with the

FDIC.

Approximately $625 million of Puerto

Rico branch deposits (10 branches) were

assumed for a 1.60% deposit premium.

The average cost of these deposits is

0.72%.

No brokered CDs assumed.

(1)

Figures as of 12/31/14 which are subject to customary post-closing adjustments based on closing date totals and purchase accounting adjustments.

Assumed Deposit Mix

Loans Acquired:

Deposits Assumed:

NOW &

MMA

45%

5

The transaction is accretive to earnings.  Estimated annual pre-tax impact of $10 to 12 million.

Fee income increase of $6 to 8 million.

Noninterest expense associated with branch operations and additional employees of $10 to 12

million.

The excess cash received

will either be re-invested or used to pay down higher cost

borrowings.

The transaction reduces the pro forma total risk based capital ratio, tier 1 ratio and leverage

ratio by approximately 30 basis points.

We

will

complete

a

fair

value

analysis

of

assets

and

liabilities

during

the

first

quarter

to

determine the final financial impact of the transaction.

Financial Impact

(1)

Excluding the impact of fair value adjustments and one time costs.

(1)