-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, C5cuPiXkiiDzc5BUAvMHSuxjJtpvmM9msGZNJtGivvghEigOdfnMYq2j24pxyw5v OAPGMHbHwQaVXcd5zQDaJQ== 0000891836-99-000510.txt : 19990712 0000891836-99-000510.hdr.sgml : 19990712 ACCESSION NUMBER: 0000891836-99-000510 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990708 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19990709 FILER: COMPANY DATA: COMPANY CONFORMED NAME: POPULAR INC CENTRAL INDEX KEY: 0000763901 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 660416582 STATE OF INCORPORATION: PR FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 002-96018 FILM NUMBER: 99662282 BUSINESS ADDRESS: STREET 1: 209 MUNOZ RIVERA AVE STREET 2: POPULAR CENTER BUILDING CITY: HATO REY STATE: PR ZIP: 00918 BUSINESS PHONE: 7877659800 MAIL ADDRESS: STREET 1: P.O. BOX 362708 CITY: SAN JUAN STATE: PR ZIP: 00936-2708 FORMER COMPANY: FORMER CONFORMED NAME: BANPONCE CORP DATE OF NAME CHANGE: 19920703 8-K 1 FORM 8-K, CURRENT REPORT 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): July 8,1999 POPULAR, INC. ------------------------------------------------ (Exact name of registrant as specified in its charter) COMMONWEALTH OF PUERTO RICO NO. 0-13818 NO. 66-0416582 --------------------------- ----------- -------------- (State or other jurisdiction of (Commission (IRS Employer incorporation) File Number) Identification No.) 209 MUNOZ RIVERA AVENUE HATO REY, PUERTO RICO 00918 - ---------------------------------------- ---------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (787) 765-9800 ----------------------------------------------------------------- (Former name or former address, if changed since last report) Item 5. Other Events On July 8, 1999, Popular, Inc. (the "Corporation") announced in a news release its operational results for the quarter and six-month period ended June 30, 1999. A copy of the Corporation's release, dated July 8, 1999, is attached hereto as Exhibit 99(a) and is incorporated herein by reference. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits (c) Exhibits 99(a) News release, dated July 8, 1999, announcing the Corporation's consolidated earnings for the quarter and six-month period ended June 30, 1999. 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. Popular, Inc. ------------- (Registrant) Date: July 9, 1999 By: /s/ Amilcar L. Jordan ----------------------------------------- Name: Amilcar L. Jordan, Esq. Title: Senior Vice President and Comptroller Exhibit Index ------------- Exhibit Number Description - -------------- ----------- 99(a) News release, dated July 8, 1999 EX-99.(A) 2 NEWS RELEASE, DATED JULY 8, 1999 [POPULAR, INC. LOGO] For additional information contact: Mr. Jorge A. Junquera Senior Executive Vice President Or visit our web site at http://www.popularinc.com Telephone (787) 754-1685 July 8, 1999 News Release POPULAR, INC. EARNINGS FOR THE QUARTER AND SIX-MONTH PERIOD ENDED JUNE 30,1999 Popular, Inc. (the Corporation) announced net income of $64.0 million for the second quarter of 1999, an increase of $6.5 million or 11.3% over the $57.5 million reported for the second quarter of 1998. Earnings per common share (EPS) for the quarter were $0.46, a 12.2% increase over the $0.41 reported for the same period a year earlier. Average shares outstanding used in the above computations were 135,496,891 for the second quarter of 1999 and 135,497,786 for the same quarter of 1998. Net earnings for the first quarter of 1999 were $63.7 million, or $0.45 per common share, based on 135,709,287 average shares then outstanding. The Corporation's return on assets (ROA) and return on common equity (ROE) for the second quarter of 1999 were 1.08% and 15.53%, respectively, compared with 1.16% and 15.50% for the same period in 1998 and 1.14% and 16.03% for the first quarter of 1999. For the first six months of 1999, the Corporation's net earnings reached $127.6 million, compared with $112.3 million for the same period in 1998. EPS for the first six months of 1999 were $0.91 compared with $0.80 for the same period of 1998. ROA and ROE for the first six months of 1999 were 1.11% and 15.78%, respectively. For the same period of 1998, these ratios were 1.15% and 15.43%. The Corporation's results of operations for the quarter ended June 30, 1999, when compared with the same quarter of 1998, reflected an increase of $24.5 million in net interest income coupled with an increase of $14.0 million in other revenues. These improvements were partially offset by rises of $3.1 million in the provision for loan losses and $30.2 million in operating expenses. Net interest income for the second quarter of 1999 amounted to $238.9 million, an increase 2 - POPULAR, INC. 1999 SECOND QUARTER RESULTS of 11.4% over the same period in 1998. The growth in net interest income over the second quarter of 1998, was primarily due to an increase of $3.8 billion in average earning assets driven principally by a $2.1 billion increase in the loan portfolio together with an increase of $1.7 billion in investment and money market securities. The acquisitions made after the second quarter of 1998, the Corporation's growth and a higher volume of arbitrage activities in the investment portfolio accounted for the increase in average earning assets. The net interest yield for the quarter ended June 30, 1999 was 4.24%, compared with 4.57% for the second quarter of 1998. For the first quarter of 1999 the net interest yield was 4.39%. For the first six months of 1999, the net interest yield was 4.31%, compared with 4.61% for the same period of 1998. The provision for loan losses for the second quarter of 1999 amounted to $36.6 million compared with $33.5 million for the second quarter of 1998. The increase resulted from the growth in the loan portfolio, non-performing assets and net charge-offs. Net charge-offs for the quarter ended June 30, 1999, were $31.2 million or 0.91% of average loans compared with $27.2 million or 0.94% for the second quarter of 1998, and $25.9 million or 0.78% for the first quarter of 1999. As a percentage of average loans, net charge-offs were 0.85% and 0.95% for the six-month periods ended on June 30, 1999 and 1998, respectively. The increase in net charge-offs for the quarter was primarily reflected in the commercial loan category. Non-performing assets were $311 million or 2.24% of loans at June 30, 1999, compared with $225 million or 1.91%, at the end of the second quarter of 1998, and $299 million or 2.22% at March 31, 1999. The rise in non-performing assets from June 30, 1998 was reflected in non-performing commercial, mortgage and consumer loans. Non-interest income, excluding securities and trading gains, grew $18.7 million or 27.3%, from $68.5 million for the second quarter of 1998 to $87.2 million for the same period in 1999. The growth in non-interest income was led by an increase of $10.9 million in other service fees, $4.2 million in service charges on deposit accounts, and $3.6 million in other operating income. Other service fees amounted to $39.7 million for the three-month period ended June 30, 1999, compared with $28.8 million for the same period a year earlier. This increase is mostly attributed to the expansion of the Corporation's operations in the U.S. due to the acquisitions made during the latter part of 1998, and the growth of the retail financial services business. Check cashing fees and credit card fees and discounts increased $3.4 million each. Also, fees related to the sale and administration 3 - POPULAR, INC. 1999 SECOND QUARTER RESULTS of investment products and debit card fees showed increases when compared to the second quarter last year. Service charges on deposit accounts increased due to higher activity on commercial and retail accounts and a higher volume of deposits. The increase in other operating income is mainly due to higher gains on sale of mortgage loans, increased revenues from the daily rental business and fees generated from the Corporation's joint venture in Puerto Rico's local telephone company. Personnel costs increased $12.0 million as compared with the second quarter of 1998. Most of the increase resulted from increased employment levels due to the Corporation's continued growth and expansion, outside Puerto Rico, and annual merit increases. Other operating expenses increased $18.2 million, reaching $110.6 million for the second quarter of 1999. This increase was mostly reflected in professional fees, business promotion, equipment expenses and net occupancy expenses. Professional fees reflected higher consulting fees, technical support fees and conversion costs related to business expansion and reorganization of the U.S. operations. The increase in business promotion is mainly due to aggressive marketing efforts to expand the mortgage banking business in Puerto Rico and to penetrate the Hispanic market in the U.S. The increase in equipment expenses resulted from the Corporation's business and geographic expansion and expenditures associated with new technology and systems enhancements. Net occupancy expenses also reflected the Corporation's growth and expansion. The Corporations total assets at June 30, 1999, amounted to $23.7 billion, compared with $20.0 billion at June 30, 1998. Total assets at March 31, 1999, were $23.2 billion. The Corporation's earning assets reached $22.1 billion at June 30, 1999, compared with $18.7 billion and $21.6 billion at June 30, 1998 and March 31, 1999, respectively. Total loans were $13.9 billion at June 30, 1999 or $2.1 billion more than the level at June 30, 1998 and $429 million over March 31, 1999. Commercial loans accounted for the largest growth since June 30, 1998, increasing $1.4 billion. The growth mostly resulted from the acquisitions made afier the second quarter of 1998, the Corporation's expansion in the U.S. and marketing efforts directed to the retail and middle market. The allowance for loan losses at June 30, 1999, amounted to $283 million or 2.03% of loans compared with $224 million or 1.91% at June 30, 1998, and $277 million or 2.06% at March 31, 1999. At June 30, 1999, the allowance for loan losses as a percentage of non-performing assets was 4 - POPULAR, INC. 1999 SECOND QUARTER RESULTS 90.8% compared with 99.8% at June 30, 1998 and 92.8% at March 31, 1999. The reduction in the allowance coverage ratios is attributed to the inclusion of $34 million of non-performing assets of the subsidiary bank acquired in the Dominican Republic and the increase in non-performing mortgage loans, which due to their secured nature have a low loss experience. Total deposits grew to $13.9 billion at June 30, 1999, from $12.1 billion at June 30, 1998. Most of the growth was realized in savings and demand deposits, which increased $784 million and $706 million, respectively. At March 31, 1999, total deposits amounted to $13.6 billion. Borrowed funds, including subordinated notes and capital securities, amounted to $7.7 billion at June 30, 1999 compared with $6.0 billion at June 30, 1998, and $7.4 billion at March 31, 1999. At June 30, 1999, stockholders' equity totaled $1.65 billion compared with $1.59 billion at the same date last year. Stockholders' equity was $1.70 billion at March 31, 1999. During the second quarter of 1999, the Corporation repurchased a total of 1,089,700 shares of its common stock under the stock repurchase program approved by its Board of Directors on May 8, 1997. The Corporation may continue repurchasing its common stock if market conditions so warrant. The market value of the Corporation's common stock at June 30, 1999 was $30.31 per share, compared with $33.25 at June 30, 1998 and $30.88 at March 31, 1999. The Corporation's market capitalization at June 30, 1999, was $4.1 billion, compared with $4.5 billion at June 30, 1998, and $4.2 billion at March 31, 1999. At June 30, 1999, the Corporation's common stock had a book value per share of $11.51. The Corporation's common and preferred stocks are traded on the National Association of Securities Dealers Automated Quotation (NASDAQ) National Market System under the symbols BPOP and BPOPP, respectively. * * *
POPULAR, INC. FINANCIAL SUMMARY (in thousands, except per share data) Quarter ended June 30 Second ------------------------------ Quarter ------------- 1999 - 1998 First Percent Quarter 1999 1998 Variance 1999 ------------------------------------------------------------- SUMMARY OF OPERATIONS Interest income ................... $453,401 $402,865 12.54% $444,195 Interest expense .................. 214,550 188,473 13.84 207,956 ------------------------------------------------------------- Net interest income ............... 238,851 214,392 11.41 236,239 Provision for loan losses ......... 36,631 33,524 9.27 35,771 ------------------------------------------------------------- Net interest income after provision for loan losses 202,220 180,868 11.81 200,468 Other operating income ............ 87,222 68,526 27.25 86,889 Gain on sale of securities ........ 286 3,049 450 Trading account profit (loss) ..... (582) 1,311 (282) ------------------------------------------------------------- Total other income ................ 86,926 72,886 19.26 87,057 Salaries and benefits ............. 88,556 76,393 12.26 89,716 Profit sharing .................... 6,084 6,264 (2.87) 6,320 Amortization of intangibles ....... 7,586 6,849 7,520 Other operating expenses .......... 102,991 85,539 20.40 98,235 ------------------------------------------------------------- Total operating expenses .......... 205,217 175,045 17.24 201,891 ------------------------------------------------------------- Income before income tax and minority interest ................. 83,929 78,709 6.63 85,634 Income tax ........................ 20,334 21,248 -4.30 22,402 Net losses of minority interest ... 382 432 ------------------------------------------------------------- Net income ........................ $63,977 $57,461 11.34 $63,864 ============================================================= Net income applicable to common stock ............................. $81,889 $55,374 11.77 $61,577 ============================================================= Earnings per common share: Net income ........................ $0.46 $0.41 12.20 $0.45 ----- ----- ----- ----- Average common shares outstanding . 135,496,891 135,497,786 135,709,287 Common shares outstanding at end of period ......................... 134,696,572 135,497,786 135,709,287 SELECTED AVERAGE BALANCES Total assets ...................... $23,655,275 $19,934,644 18.66 $22,695,779 Loans ............................. 13,891,097 11,615,054 17.87 13,211,405 Earning assets .................... 22,525,626 18,789,875 20.01 21,542,123 Deposits .......................... 13,818,195 12,196,131 13.28 13,578,244 Interest-bearing liabilities ...... 18,391,158 15,488,018 18.74 17,807,155 Stockholders' equity .............. 1,698,197 1,533,035 10.77 1,859,015 SELECTED FINANCIAL DATA AT PERIOD-END Total assets ...................... $23,678,626 $19,997,836 18.41 $23,174,075 Loans ............................. 13,897,392 11,753,213 18.18 13,458,245 Earnings assets ................... 22,119,958 18,725,774 18.13 21,626,534 Deposits .......................... 13,915,390 12,102,594 14.98 13,576,672 Interest-bearing liabilities ...... 18,304,858 15,487,420 18.34 18,068,536 Stockholders' equity .............. 1,650,682 1,593,693 3.58 1,704,482 PERFORMANCE RATIOS Net interest yield* ............... 4.24% 4.57% 4.39% Return on assets .................. 1.08 1.16 1.14 Return on common equity ........... 15.53 15.50 16.03 CREDIT QUALITY DATA Nonperforming assets .............. $311,331 $224,521 38.86 $298,589 Net loans charged-off ............. 31,157 27,187 14.60 25,904 Allowance for loan losses ......... 282,580 224,045 26.13 227,116 Non performing assets to total assets ............................ 1.31% 1.12% 1.29% Allowance for losses to loans ..... 2.03 1.91 2.06 * Not on a taxable equivalent basis
POPULAR, INC. FINANCIAL SUMMARY (in thousands, except per share data) (continued . . .) For the six month ended June 30 --------------------------------------------------- Percent 1999 1998 Variance --------------------------------------------------- SUMMARY OF OPERATIONS Interest income ................... $897,596 $799,232 12.31% Interest expense .................. 422,506 372,136 13.54 --------------------------------------------------- Net interest income ............... 475,890 427,096 11.24 Provision for loan losses ......... 72,402 67,089 7.92 --------------------------------------------------- Net interest income after provision for loan losses 402,688 360,007 11.86 Other operating income ............ 174,111 134,939 29.03 Gain on sale of securities ........ 736 3,917 Trading account profit (loss) ..... (864) 1,981 --------------------------------------------------- Total other income ................ 173,983 140,837 23.54 Salaries and benefits ............. 178,272 164,104 15.85 Profit sharing .................... 12,404 11,947 3.83 Amortization of intangibles ....... 15,206 13,633 Other operating expenses .......... 201,226 157,740 19.96 --------------------------------------------------- Total operating expenses .......... 407,108 347,424 17.18 --------------------------------------------------- Income before income tax and minority interest ................. 169,563 153,420 10.52 Income tax ........................ 42,736 41,164 3.82 Net losses of minority interest ... 814 --------------------------------------------------- Net income ........................ $127,641 $112,256 13.71 =================================================== Net income applicable to common stock ............................. $123,456 $108,081 14.23 =================================================== Earnings per common share: Net income ........................ $0.91 $0.60 13.75 ----- ----- ----- Average common shares outstanding . 135,802,502 135,468,614 Common shares outstanding at end of period ......................... 134,696,872 135,497,786 SELECTED AVERAGE BALANCES Total assets ...................... $23,178,177 $19,711,518 17.59 Loans ............................. 13,452,576 11,541,258 16.55 Earning assets .................... 22,036,591 18,558,618 18.75 Deposits .......................... 13,697,877 12,001,807 14.13 Interest-bearing liabilities ...... 18,001,322 15,338,151 17.38 Stockholders' equity .............. 1,678,159 1,512,723 10.94 SELECTED FINANCIAL DATA AT PERIOD-END Total assets ...................... $23,678,625 $19,997,836 18.41 Loans ............................. 13,887,392 11,753,213 18.18 Earnings assets ................... 22,119,958 18,725,774 18.13 Deposits .......................... 13,915,390 12,102,594 14.98 Interest-bearing liabilities ...... 18,304,858 15,487,420 18.34 Stockholders' equity .............. 1,650,682 1,593,893 3.58 PERFORMANCE RATIOS Net interest yield* ............... 4.31% 4.61% Return on assets .................. 1.11 1.15 Return on common equity ........... 15.78 15.43 CREDIT QUALITY DATA Nonperforming assets .............. $311,331 $224,521 Net loans charged-off ............. 57,061 54,695 Allowance for loan losses ......... 282,580 224,045 Non performing assets to total assets ............................ 1.31% 1.12% Allowance for losses to loans ..... 2.03 1.91 * Not on a taxable equivalent basis
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