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):
October
19, 2012
POPULAR,
INC.
(Exact
name of registrant as specified in its charter)
COMMONWEALTH OF PUERTO RICO |
001-34084 |
66-0667416 |
(State or other jurisdiction of incorporation or organization) |
(Commission File |
(IRS Employer Identification |
209 MUNOZ RIVERA AVENUE |
00918 |
|
(Address of principal executive offices) |
(Zip code) |
(787) 765-9800 |
(Registrant's telephone number, including area code) |
NOT APPLICABLE |
(Former name, former address and former fiscal year, 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 2.02. Results of Operations and Financial Condition.
On October 19, 2012, Popular, Inc. issued a news release announcing its unaudited financial results for the quarter ended September 30, 2012, a copy of which is attached as Exhibit 99.1 to this Current Report on Form 8-K. The information furnished pursuant to this Item 2.02 of this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed "filed" for purposes of the Securities Exchange Act of 1934, as amended, nor shall it be incorporated by reference into any of the Corporation’s filings under the Securities Act of 1933, as amended, unless otherwise expressly stated in such filing.
Item 9.01. Financial Statements and Exhibits
99.1 Press release dated October 19, 2012
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: October 19, 2012 |
By: /s/ Jorge J. García |
|||
Jorge J. García |
||||
Senior Vice President and Corporate Comptroller |
Exhibit 99.1
Popular, Inc. Reports Net Income of $47.2 million for the Quarter Ended September 30, 2012
SAN JUAN, Puerto Rico--(BUSINESS WIRE)--October 19, 2012--Popular, Inc. (“the Corporation” or “Popular”) (NASDAQ:BPOP) reported net income of $47.2 million for the quarter ended September 30, 2012, compared with net income of $65.7 million for the quarter ended June 30, 2012.
Mr. Richard L. Carrión, Chairman of the Board and Chief Executive Officer, said: “Third quarter results reflected continued strength and stability in our revenues, further declines in non-performing loans and charge-offs, and increases in our already strong capital ratios. Our number one priority is continuing to reduce non-performing assets, which will improve returns and increase our strategic and financial flexibility.”
Earnings Highlights – Third Quarter 2012
Quarters ended | ||||||
(Dollars in thousands, except per share information) | 30-Sep-12 | 30-Jun-12 | 30-Sep-11 | |||
Net interest income | $ 343,426 | $ 341,200 | $ 369,311 | |||
Provision for loan losses – non-covered loans | 83,589 | 81,743 | 150,703 | |||
Provision for loan losses – covered loans [1] | 22,619 | 37,456 | 25,573 | |||
Net interest income after provision for loan losses | 237,218 | 222,001 | 193,035 | |||
FDIC loss share (expense) income | (6,707) | 2,575 | (5,361) | |||
Other non-interest income | 122,416 | 91,149 | 127,751 | |||
Operating expenses | 290,355 | 327,879 | 282,355 | |||
Income (loss) before income tax | 62,572 | (12,154) | 33,070 | |||
Income tax expense (benefit) | 15,384 | (77,893) | 5,537 | |||
Net income | $ 47,188 | $ 65,739 | $ 27,533 | |||
Net income applicable to common stock | $ 46,257 | $ 64,809 | $ 26,602 | |||
Net income per common share - basic and diluted [2] | $0.45 | $0.63 | $0.26 | |||
[1] Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that are covered under FDIC loss sharing agreements. [2] Per share data has been adjusted to retroactively reflect the 1-for-10 reverse stock split effected on May 29, 2012. |
||||||
Financial Impact of FDIC-Assisted Transaction | ||||||
(In thousands) | 30-Sep-12 | 30-Jun-12 | 30-Sep-11 | |||
Income Statement |
||||||
Interest income on covered loans | $ 70,584 | $ 79,094 | $ 105,809 | |||
Total FDIC loss share (expense) income | (6,707) | 2,575 | (5,361) | |||
Other non-interest income | 310 | 310 | - | |||
Provision for loan losses | 22,619 | 37,456 | 25,573 | |||
Total revenues less provision for loan losses | $ 41,568 | $ 44,523 | $ 74,875 | |||
Balance Sheet |
||||||
Loans covered under loss-sharing agreement with FDIC | $ 3,903,867 | $ 4,016,330 | $ 4,512,423 | |||
FDIC loss share asset | 1,559,057 | 1,631,594 | 1,895,059 | |||
FDIC true-up payment obligation | 103,189 | 100,198 | 96,720 | |||
See additional details on accounting for FDIC-Assisted transaction in Table O.
Net interest income
Net interest margin for the third quarter of 2012 increased 4 basis points to 4.37% as compared to the second quarter of 2012. Net interest income reached $343.4 million, an increase of $2.2 million from the second quarter. The main drivers of the improvement in net interest margin are:
Provision for Loan Losses
(In thousands) | 30-Sep-12 | 30-Jun-12 | 30-Sep-11 | |||
Provision for loan losses - non-covered loans | ||||||
BPPR | $ 69,738 | $ 66,443 | $ 131,058 | |||
BPNA | 13,851 | 15,300 | 19,645 | |||
83,589 | 81,743 | 150,703 | ||||
Provision for loan losses - covered loans | 22,619 | 37,456 | 25,573 |
The provision for loan losses for the third quarter of 2012 amounted to $106.2 million, a decrease of $13.0 million versus the previous quarter, mainly driven by lower provision for the covered loan portfolio.
Non-interest income
Non-interest income increased by $22.0 million versus the second quarter, driven primarily by the following items:
These increases were partially offset by:
Refer to table B for further details.
Operating expenses
Operating expenses decreased by $37.5 million versus the second quarter, driven primarily by the following items:
These decreases were partially offset by:
Non-personnel credit related costs, which includes collections, appraisals, credit related fees and OREO expenses, amounted to $18.1 million for the third quarter of 2012, compared to $13.5 million for the second quarter of 2012. The increase is principally due to an increase in OREO expenses of $3.5 million as mentioned above and in other credit costs of approximately $1.0 million.
Full-time equivalent employees (“FTEs”) were 8,074 as of September 30, 2012, compared with 8,093 as of June 30, 2012 and 8,329 as of December 31, 2011.
For a breakdown of operating expenses by category refer to table B.
Income taxes
Income tax expense amounted to $15.4 million for the quarter ended September 30, 2012, compared with an income tax benefit of $77.9 million for the second quarter of 2012, when the Corporation recognized an income tax benefit of $72.9 million as a result of the agreement signed with the P.R. Treasury which stated that covered loans are capital assets and will be taxed at the capital gain tax rate of 15%. Excluding the effect of extraordinary items, the Corporation expects an effective tax rate of approximately 16% for its Puerto Rico banking operations for 2012.
Credit Quality:
Non-Performing Assets | ||||||
(In thousands) | 30-Sep-12 | 30-Jun-12 | 30-Sep-11 | |||
Total non-performing loans held-in-portfolio, excluding covered loans | $1,550,500 | $1,562,818 | $1,731,671 | |||
Non-performing loans held-for-sale | 108,886 | 178,652 | 259,776 | |||
Other real estate owned (“OREO”), excluding covered OREO | 252,024 | 226,629 | 175,785 | |||
Total non-performing assets, excluding covered assets | 1,911,410 | 1,968,099 | 2,167,232 | |||
Covered loans and OREO | 208,235 | 209,793 | 86,301 | |||
Total non-performing assets | 2,119,645 | 2,177,892 | 2,253,533 | |||
Net charge-offs for the quarter (excluding covered loans) | 95,791 | 97,976 | 135,175 | |||
Ratios (excluding covered loans): | ||||||
Non-performing loans held-in-portfolio to loans held-in-portfolio | 7.47% | 7.56% | 8.38% | |||
Allowance for loan losses to loans held-in-portfolio | 3.07 | 3.14 | 3.35 | |||
Allowance for loan losses to non-performing loans, excluding loans held-for-sale | 41.04 | 41.50 | 39.99 |
Credit quality continues to improve as the Company addresses its non-performing loan balances and manages asset exposures.
Credit Quality by Segment | ||||||
(In thousands) | ||||||
BPPR (non-covered loans) | 30-Sep-12 | 30-Jun-12 | 30-Sep-11 | |||
Provision for loan losses | $ 69,738 | $ 66,443 | $ 131,058 | |||
Net charge-offs | 71,041 | 67,422 | 89,666 | |||
Total non-performing loans held-in-portfolio | 1,284,026 | 1,276,294 | 1,336,918 | |||
Allowance/loans held-in-portfolio |
2.96% | 2.99% | 3.01% | |||
BPNA | 30-Sep-12 | 30-Jun-12 | 30-Sep-11 | |||
Provision for loan losses | $ 13,851 | $ 15,300 | $ 19,645 | |||
Net charge-offs | 24,750 | 30,554 | 45,509 | |||
Total non-performing loans held-in-portfolio | 266,474 | 286,524 | 394,753 | |||
Allowance/loans held-in-portfolio |
3.35% | 3.51% | 4.19% |
BPPR Reportable Segment:
BPNA Reportable Segment:
Financial Condition
Financial Condition Highlights | ||||||
(In thousands) | 30-Sep-12 | 30-Jun-12 | 30-Sep-11 | |||
Total assets | $ 36,503,366 | $ 36,612,179 | $ 38,275,323 | |||
Total loans held-in-portfolio (net) | 23,896,548 | 23,916,109 | 24,413,388 | |||
Deposits | 26,319,499 | 27,414,780 | 27,953,340 | |||
Borrowings | 5,017,141 | 3,620,419 | 5,318,551 | |||
Stockholders’ equity | 4,068,983 | 4,021,237 | 4,012,601 |
Refer to Table C for the Statements of Condition.
Outlook
The Company reaffirmed its expectation for 2012 net income of between $210 million and $225 million.
Forward-Looking Statements
The information included in this news release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and involve certain risks and uncertainties that may cause actual results to differ materially from those expressed in forward-looking statements. Factors that might cause such a difference include, but are not limited to (i) the rate of growth in the economy and employment levels, as well as general business and economic conditions; (ii) changes in interest rates, as well as the magnitude of such changes; (iii) the fiscal and monetary policies of the federal government and its agencies; (iv) changes in federal bank regulatory and supervisory policies, including required levels of capital; (v) the relative strength or weakness of the consumer and commercial credit sectors and of the real estate markets in Puerto Rico and the other markets in which borrowers are located; (vi) the performance of the stock and bond markets; (vii) competition in the financial services industry; (viii) possible legislative, tax or regulatory changes; (ix) the impact of the Dodd-Frank Act on our businesses, business practice and cost of operations; and (x) additional Federal Deposit Insurance Corporation assessments. For a discussion of such factors and certain risks and uncertainties to which the Corporation is subject, see the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2011, as well as its filings with the U.S. Securities and Exchange Commission. Other than to the extent required by applicable law, including the requirements of applicable securities laws, the Corporation assumes no obligation to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements.
Founded in 1893, Popular, Inc. is the leading banking institution by both assets and deposits in Puerto Rico and ranks 36th by assets among U.S. banks. In the United States, Popular has established a community-banking franchise providing a broad range of financial services and products with branches in New York, New Jersey, Illinois, Florida and California.
An electronic version of this press release can be found at the Corporation’s website, www.popular.com.
Popular will hold a conference call to discuss the financial results on Friday, October 19, 2012 at 10:30 a.m. Eastern time. The call will be broadcast live over the Internet and can be accessed through the investor relations section of the Corporation’s website: www.popular.com.
Listeners are recommended to go to the website at least 15 minutes prior to the call to download and install any necessary audio software. The call may also be accessed through a dial-in telephone number 866-713-8565 or 617-597-5324. The conference code is 49080948.
A replay of the webcast will be archived in Popular’s website during the respective period. A telephone replay will be available from 12:30 p.m. on Friday, October 19, 2012 to 11:59 p.m. on Friday, October 26, 2012, at 888-286-8010 or 617-801-6888. The replay passcode is 67907864.
Popular, Inc. |
Financial Supplement to Third Quarter 2012 Earnings Release |
Table A - Selected Ratios and Other Information |
Table B - Consolidated Statement of Operations |
Table C - Consolidated Statement of Financial Condition |
Table D - Consolidated Average Balances and Yield / Rate Analysis - QUARTER |
Table E - Consolidated Average Balances and Yield / Rate Analysis - YEAR-TO-DATE |
Table F - Other Service Fees |
Table G - Loans and Deposits |
Table H - Non-Performing Assets |
Table I - Activity in Non-Performing Loans |
Table J - Allowance for Credit Losses, Net Charge-offs and Related Ratios |
Table K - Allowance for Loan Losses - Breakdown of General and Specific Reserves - CONSOLIDATED |
Table L - Allowance for Loan Losses - Breakdown of General and Specific Reserves - PUERTO RICO OPERATIONS |
Table M - Allowance for Loan Losses - Breakdown of General and Specific Reserves - U.S. MAINLAND OPERATIONS |
Table N - Reconciliation to GAAP Financial Measures |
Table O - Financial Information - Westernbank Covered Loans |
POPULAR, INC. | |||||||||||||||
Financial Supplement to Third Quarter 2012 Earnings Release | |||||||||||||||
Table A - Selected Ratios and Other Information | |||||||||||||||
(Unaudited) | |||||||||||||||
Quarter ended | Quarter ended | Quarter ended | Nine months ended | Nine months ended | |||||||||||
September 30, | June 30, | September 30, | September 30, | September 30, | |||||||||||
2012 | 2012 | 2011 | 2012 | 2011 | |||||||||||
Net income per common share: | |||||||||||||||
Basic and diluted [1] | $0.45 | $0.63 | $0.26 | $1.55 | $1.42 | ||||||||||
Average common shares outstanding [1] | 102,451,410 | 102,295,113 | 102,166,004 | 102,363,099 | 102,147,450 | ||||||||||
Average common shares outstanding - assuming dilution [1] | 102,484,960 | 102,410,618 | 102,166,004 | 102,666,664 | 102,251,720 | ||||||||||
Common shares outstanding at end of period [1] | 103,097,143 | 102,824,323 | 102,447,540 | 103,097,143 | 102,447,540 | ||||||||||
Market value per common share [1] | $17.45 | $16.61 | $15.00 | $17.45 | $15.00 | ||||||||||
Market Capitalization --- (In millions) | $1,799 | $1,708 | $1,537 | $1,799 | $1,537 | ||||||||||
Return on average assets | 0.52 | % | 0.73 | % | 0.29 | % | 0.59 | % | 0.52 | % | |||||
Return on average common equity | 4.81 | % | 6.94 | % | 2.81 | % | 5.63 | % | 5.33 | % | |||||
Net interest margin [2] | 4.37 | % | 4.33 | % | 4.45 | % | 4.33 | % | 4.36 | % | |||||
Common equity per share [1] | $38.98 | $38.62 | $38.68 | $38.98 | $38.68 | ||||||||||
Tangible common book value per common share (non-GAAP) [1] | $32.15 | $31.74 | $31.72 | $32.15 | $31.72 | ||||||||||
Tangible common equity to tangible assets (non-GAAP) | 9.26 | % | 9.09 | % | 8.65 | % | 9.26 | % | 8.65 | % | |||||
Tier 1 risk-based capital [3] | 16.81 | % | 16.31 | % | 15.79 | % | 16.81 | % | 15.79 | % | |||||
Total risk-based capital [3] | 18.09 | % | 17.59 | % | 17.07 | % | 18.09 | % | 17.07 | % | |||||
Tier 1 leverage [3] | 11.40 | % | 11.09 | % | 10.56 | % | 11.40 | % | 10.56 | % | |||||
Tier 1 common equity to risk-weighted assets (non-GAAP) [3] | 12.72 | % | 12.29 | % | 12.00 | % | 12.72 | % | 12.00 | % | |||||
[1] All share and per share data has been adjusted to retroactively reflect the 1-for-10 reverse stock split effected on May 29, 2012. | |||||||||||||||
[2] Not on a taxable equivalent basis. | |||||||||||||||
[3] Capital ratios for the current quarter are estimated. | |||||||||||||||
POPULAR, INC. | ||||||||||||||||||||||||||||||
Financial Supplement to Third Quarter 2012 Earnings Release | ||||||||||||||||||||||||||||||
Table B - Consolidated Statement of Operations | ||||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||||
Quarter ended | Quarter ended | Variance | Quarter ended | Variance | Nine months ended | Nine months ended | ||||||||||||||||||||||||
(In thousands, except per share information) |
September 30, | June 30, | Q3 2012 vs. | September 30, | Q3 2012 vs. | September 30, | September 30, | |||||||||||||||||||||||
2012 | 2012 | Q2 2012 | 2011 | Q3 2011 | 2012 | 2011 | ||||||||||||||||||||||||
Interest income: | ||||||||||||||||||||||||||||||
Loans | $ | 387,381 | $ | 389,342 | $ | (1,961 | ) | $ | 428,999 | $ | (41,618 | ) | $ | 1,164,665 | $ | 1,294,834 | ||||||||||||||
Money market investments | 862 | 964 | (102 | ) | 886 | (24 | ) | 2,774 | 2,759 | |||||||||||||||||||||
Investment securities | 39,945 | 43,813 | (3,868 | ) | 51,085 | (11,140 | ) | 128,828 | 157,183 | |||||||||||||||||||||
Trading account securities | 5,815 | 5,963 | (148 | ) | 10,788 | (4,973 | ) | 17,669 | 29,332 | |||||||||||||||||||||
Total interest income | 434,003 | 440,082 | (6,079 | ) | 491,758 | (57,755 | ) | 1,313,936 | 1,484,108 | |||||||||||||||||||||
Interest expense: | ||||||||||||||||||||||||||||||
Deposits | 43,000 | 48,514 | (5,514 | ) | 65,868 | (22,868 | ) | 143,193 | 213,419 | |||||||||||||||||||||
Short-term borrowings | 9,876 | 13,044 | (3,168 | ) | 13,744 | (3,868 | ) | 36,503 | 41,478 | |||||||||||||||||||||
Long-term debt | 37,701 | 37,324 | 377 | 42,835 | (5,134 | ) | 112,032 | 141,999 | ||||||||||||||||||||||
Total interest expense | 90,577 | 98,882 | (8,305 | ) | 122,447 | (31,870 | ) | 291,728 | 396,896 | |||||||||||||||||||||
Net interest income | 343,426 | 341,200 | 2,226 | 369,311 | (25,885 | ) | 1,022,208 | 1,087,212 | ||||||||||||||||||||||
Provision for loan losses - non-covered loans | 83,589 | 81,743 | 1,846 | 150,703 | (67,114 | ) | 247,846 | 306,177 | ||||||||||||||||||||||
Provision for loan losses - covered loans | 22,619 | 37,456 | (14,837 | ) | 25,573 | (2,954 | ) | 78,284 | 89,735 | |||||||||||||||||||||
Net interest income after provision for loan losses | 237,218 | 222,001 | 15,217 | 193,035 | 44,183 | 696,078 | 691,300 | |||||||||||||||||||||||
Service charges on deposit accounts | 45,858 | 46,130 | (272 | ) | 46,346 | (488 | ) | 138,577 | 138,778 | |||||||||||||||||||||
Other service fees | 64,784 | 62,027 | 2,757 | 62,664 | 2,120 | 192,850 | 179,623 | |||||||||||||||||||||||
Net gain (loss) on sale and valuation adjustments of investment securities | 64 | (349 | ) | 413 | 8,134 | (8,070 | ) | (285 | ) | 8,044 | ||||||||||||||||||||
Trading account (loss) profit | (2,266 | ) | (7,283 | ) | 5,017 | 2,912 | (5,178 | ) | (11,692 | ) | 3,287 | |||||||||||||||||||
Net gain (loss) on sale of loans, including valuation adjustments | ||||||||||||||||||||||||||||||
on loans held-for-sale | 18,495 | (15,397 | ) | 33,892 | 20,294 | (1,799 | ) | 18,569 | 14,756 | |||||||||||||||||||||
Adjustments (expense) to indemnity reserves on loans sold | (8,717 | ) | (5,398 | ) | (3,319 | ) | (10,285 | ) | 1,568 | (17,990 | ) | (29,587 | ) | |||||||||||||||||
FDIC loss share (expense) income | (6,707 | ) | 2,575 | (9,282 | ) | (5,361 | ) | (1,346 | ) | (19,387 | ) | 49,344 | ||||||||||||||||||
Fair value change in equity appreciation instrument | - | - | - | - | - | - | 8,323 | |||||||||||||||||||||||
Other operating income | 4,198 | 11,419 | (7,221 | ) | (2,314 | ) | 6,512 | 32,699 | 38,350 | |||||||||||||||||||||
Total non-interest income | 115,709 | 93,724 | 21,985 | 122,390 | (6,681 | ) | 333,341 | 410,918 | ||||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||||||
Personnel costs | ||||||||||||||||||||||||||||||
Salaries | 74,339 | 75,881 | (1,542 | ) | 77,455 | (3,116 | ) | 227,119 | 227,944 | |||||||||||||||||||||
Commissions, incentives and other bonuses | 12,800 | 14,359 | (1,559 | ) | 11,630 | 1,170 | 39,885 | 33,548 | ||||||||||||||||||||||
Pension, postretirement and medical insurance | 15,984 | 16,114 | (130 | ) | 11,385 | 4,599 | 50,523 | 36,181 | ||||||||||||||||||||||
Other personnel costs, including payroll taxes | 8,427 | 9,982 | (1,555 | ) | 11,254 | (2,827 | ) | 31,850 | 31,150 | |||||||||||||||||||||
Total personnel costs | 111,550 | 116,336 | (4,786 | ) | 111,724 | (174 | ) | 349,377 | 328,823 | |||||||||||||||||||||
Net occupancy expenses | 24,409 | 24,963 | (554 | ) | 25,885 | (1,476 | ) | 73,534 | 76,428 | |||||||||||||||||||||
Equipment expenses | 11,447 | 10,900 | 547 | 10,517 | 930 | 33,688 | 33,314 | |||||||||||||||||||||||
Other taxes | 12,666 | 12,074 | 592 | 12,391 | 275 | 38,178 | 38,986 | |||||||||||||||||||||||
Professional fees | 53,412 | 52,127 | 1,285 | 48,756 | 4,656 | 153,644 | 144,923 | |||||||||||||||||||||||
Communications | 6,500 | 6,645 | (145 | ) | 6,800 | (300 | ) | 20,276 | 21,198 | |||||||||||||||||||||
Business promotion | 14,924 | 16,980 | (2,056 | ) | 14,650 | 274 | 44,754 | 35,842 | ||||||||||||||||||||||
FDIC deposit insurance | 24,173 | 22,907 | 1,266 | 23,285 | 888 | 72,006 | 68,640 | |||||||||||||||||||||||
Loss on early extinguishment of debt | 43 | 25,072 | (25,029 | ) | 109 | (66 | ) | 25,184 | 8,637 | |||||||||||||||||||||
Other real estate owned (OREO) | 5,896 | 2,380 | 3,516 | 3,234 | 2,662 | 22,441 | 11,885 | |||||||||||||||||||||||
Credit and debit card processing, volume, interchange and other | 5,442 | 4,960 | 482 | 5,416 | 26 | 15,083 | 13,565 | |||||||||||||||||||||||
Other operating expenses | 17,412 | 30,004 | (12,592 | ) | 17,125 | 287 | 58,631 | 49,990 | ||||||||||||||||||||||
Amortization of intangibles | 2,481 | 2,531 | (50 | ) | 2,463 | 18 | 7,605 | 6,973 | ||||||||||||||||||||||
Total operating expenses | 290,355 | 327,879 | (37,524 | ) | 282,355 | 8,000 | 914,401 | 839,204 | ||||||||||||||||||||||
Income (loss) before income tax | 62,572 | (12,154 | ) | 74,726 | 33,070 | 29,502 | 115,018 | 263,014 | ||||||||||||||||||||||
Income tax expense (benefit) | 15,384 | (77,893 | ) | 93,277 | 5,537 | 9,847 | (46,317 | ) | 114,664 | |||||||||||||||||||||
Net income | $ | 47,188 | $ | 65,739 | $ | (18,551 | ) | $ | 27,533 | $ | 19,655 | $ | 161,335 | $ | 148,350 | |||||||||||||||
Net income applicable to common stock | $ | 46,257 | $ | 64,809 | $ | (18,552 | ) | $ | 26,602 | $ | 19,655 | $ | 158,543 | $ | 145,558 | |||||||||||||||
Net income per common share - basic [1] | $ | 0.45 | $ | 0.63 | $ | (0.18 | ) | $ | 0.26 | $ | 0.19 | $ | 1.55 | $ | 1.42 | |||||||||||||||
Net income per common share - diluted [1] | $ | 0.45 | $ | 0.63 | $ | (0.18 | ) | $ | 0.26 | $ | 0.19 | $ | 1.55 | $ | 1.42 | |||||||||||||||
[1] Per share data has been adjusted to retroactively reflect the 1-for-10 reverse stock split effected on May 29, 2012. | ||||||||||||||||||||||||||||||
Popular, Inc. | ||||||||||||||||||
Financial Supplement to Third Quarter 2012 Earnings Release | ||||||||||||||||||
Table C - Consolidated Statement of Financial Condition | ||||||||||||||||||
(Unaudited) | ||||||||||||||||||
Variance | ||||||||||||||||||
September 30, | June 30, | September 30, | Q3 2012 vs. | |||||||||||||||
(In thousands) | 2012 | 2012 | 2011 | Q2 2012 | ||||||||||||||
Assets: | ||||||||||||||||||
Cash and due from banks | $ | 477,342 | $ | 515,338 | $ | 567,141 | $ | (37,996 | ) | |||||||||
Money market investments | 925,663 | 949,828 | 1,269,139 | (24,165 | ) | |||||||||||||
Trading account securities, at fair value | 226,918 | 417,469 | 272,939 | (190,551 | ) | |||||||||||||
Investment securities available-for-sale, at fair value | 5,120,301 | 5,076,797 | 5,226,529 | 43,504 | ||||||||||||||
Investment securities held-to-maturity, at amortized cost | 122,072 | 124,646 | 128,546 | (2,574 | ) | |||||||||||||
Other investment securities, at lower of cost or realizable value | 213,389 | 174,287 | 173,569 | 39,102 | ||||||||||||||
Loans held-for-sale, at lower of cost or fair value | 337,049 | 364,537 | 368,777 | (27,488 | ) | |||||||||||||
Loans held-in-portfolio: | ||||||||||||||||||
Loans not covered under loss sharing agreements with the FDIC | 20,753,853 | 20,665,809 | 20,673,886 | 88,044 | ||||||||||||||
Loans covered under loss sharing agreements with the FDIC | 3,903,867 | 4,016,330 | 4,512,423 | (112,463 | ) | |||||||||||||
Less: Allowance for loan losses | (761,172 | ) | (766,030 | ) | (772,921 | ) | 4,858 | |||||||||||
Total loans held-in-portfolio, net | 23,896,548 | 23,916,109 | 24,413,388 | (19,561 | ) | |||||||||||||
FDIC loss share asset | 1,559,057 | 1,631,594 | 1,895,059 | (72,537 | ) | |||||||||||||
Premises and equipment, net | 525,733 | 527,027 | 536,529 | (1,294 | ) | |||||||||||||
Other real estate not covered under loss sharing agreements with the FDIC | 252,024 | 226,629 | 175,785 | 25,395 | ||||||||||||||
Other real estate covered under loss sharing agreements with the FDIC | 125,514 | 125,093 | 75,339 | 421 | ||||||||||||||
Accrued income receivable | 133,943 | 122,320 | 134,263 | 11,623 | ||||||||||||||
Mortgage servicing assets, at fair value | 158,367 | 155,711 | 157,226 | 2,656 | ||||||||||||||
Other assets | 1,724,927 | 1,577,794 | 2,168,529 | 147,133 | ||||||||||||||
Goodwill | 647,757 | 647,757 | 648,353 | - | ||||||||||||||
Other intangible assets | 56,762 | 59,243 | 64,212 | (2,481 | ) | |||||||||||||
Total assets | $ | 36,503,366 | $ | 36,612,179 | $ | 38,275,323 | $ | (108,813 | ) | |||||||||
Liabilities and Stockholders’ Equity: | ||||||||||||||||||
Liabilities: | ||||||||||||||||||
Deposits: | ||||||||||||||||||
Non-interest bearing | $ | 5,404,470 | $ | 5,578,487 | $ | 5,527,450 | $ | (174,017 | ) | |||||||||
Interest bearing | 20,915,029 | 21,836,293 | 22,425,890 | (921,264 | ) | |||||||||||||
Total deposits | 26,319,499 | 27,414,780 | 27,953,340 | (1,095,281 | ) | |||||||||||||
Federal funds purchased and assets sold under agreements to repurchase | 1,944,564 | 1,426,636 | 2,601,606 | 517,928 | ||||||||||||||
Other short-term borrowings | 1,206,200 | 316,200 | 166,200 | 890,000 | ||||||||||||||
Notes payable | 1,866,377 | 1,877,583 | 2,550,745 | (11,206 | ) | |||||||||||||
Other liabilities | 1,097,742 | 1,555,743 | 990,831 | (458,001 | ) | |||||||||||||
Total liabilities | 32,434,382 | 32,590,942 | 34,262,722 | (156,560 | ) | |||||||||||||
Stockholders’ equity: | ||||||||||||||||||
Preferred stock | 50,160 | 50,160 | 50,160 | - | ||||||||||||||
Common stock | 1,031 | 1,028 | 1,025 | 3 | ||||||||||||||
Surplus | 4,131,681 | 4,127,216 | 4,108,603 | 4,465 | ||||||||||||||
Accumulated deficit | (54,183 | ) | (100,440 | ) | (201,770 | ) | 46,257 | |||||||||||
Treasury stock | (270 | ) | (144 | ) | (992 | ) | (126 | ) | ||||||||||
Accumulated other comprehensive (loss) income | (59,435 | ) | (56,583 | ) | 55,575 | (2,852 | ) | |||||||||||
Total stockholders’ equity | 4,068,984 | 4,021,237 | 4,012,601 | 47,747 | ||||||||||||||
Total liabilities and stockholders’ equity | $ | 36,503,366 | $ | 36,612,179 | $ | 38,275,323 | $ | (108,813 | ) | |||||||||
Popular, Inc. | ||||||||||||||||||||||||||||||||||||||
Financial Supplement to Third Quarter 2012 Earnings Release | ||||||||||||||||||||||||||||||||||||||
Table D - Consolidated Average Balances and Yield / Rate Analysis - QUARTER | ||||||||||||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||||||||||||
Quarter ended | Quarter ended | Quarter ended | Variance | Variance | ||||||||||||||||||||||||||||||||||
($ amounts in millions; yields not on a taxable equivalent basis) |
September 30, 2012 | June 30, 2012 | September 30, 2011 | Q3 2012 vs Q2 2012 | Q3 2012 vs Q3 2011 | |||||||||||||||||||||||||||||||||
Average |
Income/ |
Yield/ |
Average |
Income/ |
Yield/ |
Average |
Income/ |
Yield/ |
Average |
Income/ |
Yield/ |
Average |
Income/ |
Yield/ |
||||||||||||||||||||||||
balance | Expense | Rate | balance | Expense | Rate | balance | Expense | Rate | balance | Expense | Rate | balance | Expense | Rate | ||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||||||||
Interest earning assets: | ||||||||||||||||||||||||||||||||||||||
Money market, trading and investment securities | $6,625 | $46.6 | 2.81 | % | $6,819 | $50.7 | 2.98 | % | $7,540 | $62.8 | 3.32 | % | ($194) | ($4.1) | (0.17) | % | ($915) | ($16.2) | (0.51) | % | ||||||||||||||||||
Loans not covered under loss sharing agreements with the FDIC: | ||||||||||||||||||||||||||||||||||||||
Commercial | 10,024 | 123.2 | 4.89 | 10,237 | 126.2 | 4.96 | 10,690 | 134.1 | 4.98 | (213) | (3.0) | (0.07) | (666) | (10.9) | (0.09) | |||||||||||||||||||||||
Construction | 435 | 3.3 | 3.02 | 495 | 3.4 | 2.78 | 698 | 2.5 | 1.45 | (60) | (0.1) | 0.24 | (263) | 0.8 | 1.57 | |||||||||||||||||||||||
Mortgage | 5,915 | 80.7 | 5.46 | 5,713 | 77.8 | 5.44 | 5,326 | 78.7 | 5.91 | 202 | 2.9 | 0.02 | 589 | 2.0 | (0.45) | |||||||||||||||||||||||
Consumer | 3,855 | 97.9 | 10.10 | 3,640 | 91.1 | 10.07 | 3,656 | 95.1 | 10.32 | 215 | 6.8 | 0.03 | 199 | 2.8 | (0.22) | |||||||||||||||||||||||
Lease financing | 540 | 11.7 | 8.67 | 546 | 11.8 | 8.65 | 572 | 12.8 | 8.93 | (6) | (0.1) | 0.02 | (32) | (1.1) | (0.26) | |||||||||||||||||||||||
Total loans not covered under loss sharing agreements with the FDIC | 20,769 | 316.8 | 6.08 | 20,631 | 310.3 | 6.04 | 20,942 | 323.2 | 6.14 | 138 | 6.5 | 0.04 | (173) | (6.4) | (0.06) | |||||||||||||||||||||||
Loans covered under loss sharing agreements with the FDIC | 3,952 | 70.6 | 7.12 | 4,129 | 79.1 | 7.69 | 4,557 | 105.8 | 9.23 | (177) | (8.5) | (0.57) | (605) | (35.2) | (2.11) | |||||||||||||||||||||||
Total loans | 24,721 | 387.4 | 6.24 | 24,760 | 389.4 | 6.31 | 25,499 | 429.0 | 6.69 | (39) | (2.0) | (0.07) | (778) | (41.6) | (0.45) | |||||||||||||||||||||||
Total interest earning assets | 31,346 | $434.0 | 5.52 | % | 31,579 | $440.1 | 5.59 | % | 33,039 | $491.8 | 5.92 | % | (233) | ($6.1) | (0.07) | % | (1,693) | ($57.8) | (0.40) | % | ||||||||||||||||||
Allowance for loan losses | (757) | (777) | (749) | 20 | (8) | |||||||||||||||||||||||||||||||||
Other non-interest earning assets | 5,396 | 5,415 | 5,704 | (19) | (308) | |||||||||||||||||||||||||||||||||
Total average assets | $35,985 | $36,217 | $37,994 | ($232) | ($2,009) | |||||||||||||||||||||||||||||||||
Liabilities and Stockholders' Equity: | ||||||||||||||||||||||||||||||||||||||
Interest bearing deposits: | ||||||||||||||||||||||||||||||||||||||
NOW and money market | $5,709 | $6.2 | 0.43 | % | $5,555 | $6.2 | 0.45 | % | $5,284 | $7.3 | 0.55 | % | $154 | $0.0 | (0.02) | % | $425 | ($1.1) | (0.12) | % | ||||||||||||||||||
Savings | 6,561 | 4.5 | 0.27 | 6,562 | 6.2 | 0.38 | 6,307 | 8.6 | 0.54 | (1) | (1.7) | (0.11) | 254 | (4.1) | (0.27) | |||||||||||||||||||||||
Time deposits | 9,003 | 32.3 | 1.43 | 9,752 | 36.1 | 1.49 | 10,876 | 50.0 | 1.82 | (749) | (3.8) | (0.06) | (1,873) | (17.7) | (0.39) | |||||||||||||||||||||||
Total interest bearing deposits | 21,273 | 43.0 | 0.80 | 21,869 | 48.5 | 0.89 | 22,467 | 65.9 | 1.16 | (596) | (5.5) | (0.09) | (1,194) | (22.9) | (0.36) | |||||||||||||||||||||||
Borrowings | 4,426 | 47.6 | 4.29 | 4,165 | 50.4 | 4.85 | 5,675 | 56.6 | 3.98 | 261 | (2.8) | (0.56) | (1,249) | (9.0) | 0.31 | |||||||||||||||||||||||
Total interest bearing liabilities | 25,699 | 90.6 | 1.40 | 26,034 | 98.9 | 1.52 | 28,142 | 122.5 | 1.73 | (335) | (8.3) | (0.12) | (2,443) | (31.9) | (0.33) | |||||||||||||||||||||||
Net interest spread | 4.12 | % | 4.07 | % | 4.19 | % | 0.05 | % | (0.07) | % | ||||||||||||||||||||||||||||
Non-interest bearing deposits | 5,319 | 5,309 | 5,095 | 10 | 224 | |||||||||||||||||||||||||||||||||
Other liabilities | 1,091 | 1,073 | 956 | 18 | 135 | |||||||||||||||||||||||||||||||||
Stockholders' equity | 3,876 | 3,801 | 3,801 | 75 | 75 | |||||||||||||||||||||||||||||||||
Total average liabilities and stockholders' equity | $35,985 | $36,217 | $37,994 | ($232) | ($2,009) | |||||||||||||||||||||||||||||||||
Net interest income / margin non-taxable equivalent basis | $343.4 | 4.37 | % | $341.2 | 4.33 | % | $369.3 | 4.45 | % | $2.2 | 0.04 | % | ($25.9) | (0.08) | % | |||||||||||||||||||||||
Popular, Inc. | |||||||||||||||||||||||||||||
Financial Supplement to Third Quarter 2012 Earnings Release | |||||||||||||||||||||||||||||
Table E - Consolidated Average Balances and Yield / Rate Analysis - YEAR-TO-DATE | |||||||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||||||
Nine months ended | Nine months ended | ||||||||||||||||||||||||||||
($ amounts in millions; yields not on a taxable equivalent basis) |
September 30, 2012 | September 30, 2011 | Variance | ||||||||||||||||||||||||||
Average |
Income/ |
Yield/ |
Average |
Income/ |
Yield/ |
Average |
Income/ |
Yield/ |
|||||||||||||||||||||
balance | Expense | Rate | balance | Expense | Rate | balance | Expense | Rate | |||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||
Interest earning assets: | |||||||||||||||||||||||||||||
Money market, trading and investment securities | $6,735 | $149.3 | 2.96 | % | $7,542 | $189.3 | 3.35 | % | ($807 | ) | ($40.0 | ) | (0.39 | ) | % | ||||||||||||||
Loans not covered under loss sharing agreements with the FDIC: | |||||||||||||||||||||||||||||
Commercial | 10,234 | 375.9 | 4.91 | 10,987 | 410.5 | 4.99 | (753 | ) | (34.6 | ) | (0.08 | ) | |||||||||||||||||
Construction | 484 | 13.3 | 3.66 | 788 | 8.5 | 1.45 | (304 | ) | 4.8 | 2.21 | |||||||||||||||||||
Mortgage | 5,698 | 233.9 | 5.47 | 5,070 | 231.5 | 6.09 | 628 | 2.4 | (0.62 | ) | |||||||||||||||||||
Consumer | 3,719 | 281.6 | 10.11 | 3,645 | 281.1 | 10.31 | 74 | 0.5 | (0.20 | ) | |||||||||||||||||||
Lease financing | 547 | 35.5 | 8.66 | 582 | 39.0 | 8.93 | (35 | ) | (3.5 | ) | (0.27 | ) | |||||||||||||||||
Total loans not covered under loss sharing agreements with the FDIC | 20,682 | 940.2 | 6.07 | 21,072 | 970.6 | 6.15 | (390 | ) | (30.4 | ) | (0.08 | ) | |||||||||||||||||
Loans covered under loss sharing agreements with the FDIC | 4,124 | 224.4 | 7.27 | 4,685 | 324.2 | 9.25 | (561 | ) | (99.8 | ) | (1.98 | ) | |||||||||||||||||
Total loans | 24,806 | 1,164.6 | 6.27 | 25,757 | 1,294.8 | 6.72 | (951 | ) | (130.2 | ) | (0.45 | ) | |||||||||||||||||
Total interest earning assets | 31,541 | $1,313.9 | 5.56 | % | 33,299 | $1,484.1 | 5.95 | % | (1,758 | ) | ($170.2 | ) | (0.39 | ) | % | ||||||||||||||
Allowance for loan losses | (779 | ) | (744 | ) | (35 | ) | |||||||||||||||||||||||
Other non-interest earning assets | 5,490 | 5,957 | (467 | ) | |||||||||||||||||||||||||
Total average assets | $36,252 | $38,512 | ($2,260 | ) | |||||||||||||||||||||||||
Liabilities and Stockholders' Equity: | |||||||||||||||||||||||||||||
Interest bearing deposits: | |||||||||||||||||||||||||||||
NOW and money market | $5,504 | $18.5 | 0.45 | % | $5,206 | $24.6 | 0.63 | % | $298 | ($6.1 | ) | (0.18 | ) | % | |||||||||||||||
Savings | 6,543 | 16.9 | 0.35 | 6,269 | 31.1 | 0.66 | 274 | (14.2 | ) | (0.31 | ) | ||||||||||||||||||
Time deposits | 9,680 | 107.8 | 1.49 | 10,999 | 157.7 | 1.92 | (1,319 | ) | (49.9 | ) | (0.43 | ) | |||||||||||||||||
Total interest bearing deposits | 21,727 | 143.2 | 0.88 | 22,474 | 213.4 | 1.27 | (747 | ) | (70.2 | ) | (0.39 | ) | |||||||||||||||||
Borrowings | 4,319 | 148.5 | 4.59 | 6,299 | 183.5 | 3.89 | (1,980 | ) | (35.0 | ) | 0.70 | ||||||||||||||||||
Total interest bearing liabilities | 26,046 | 291.7 | 1.50 | 28,773 | 396.9 | 1.84 | (2,727 | ) | (105.2 | ) | (0.34 | ) | |||||||||||||||||
Net interest spread | 4.06 | % | 4.11 | % | (0.05 | ) | % | ||||||||||||||||||||||
Non-interest bearing deposits | 5,281 | 5,022 | 259 | ||||||||||||||||||||||||||
Other liabilities | 1,113 | 1,013 | 100 | ||||||||||||||||||||||||||
Stockholders' equity | 3,812 | 3,704 | 108 | ||||||||||||||||||||||||||
Total average liabilities and stockholders' equity | $36,252 | $38,512 | ($2,260 | ) | |||||||||||||||||||||||||
Net interest income / margin non-taxable equivalent basis | $1,022.2 | 4.33 | % | $1,087.2 | 4.36 | % | ($65.0 | ) | (0.03 | ) | % | ||||||||||||||||||
Popular, Inc. | ||||||||||||||||||||
Financial Supplement to Third Quarter 2012 Earnings Release | ||||||||||||||||||||
Table F - Other Service Fees | ||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||
Quarters ended | Variance | Variance | ||||||||||||||||||
September 30, | June 30, | September 30, | Q3 2012 vs. | Q3 2012 vs. | ||||||||||||||||
(In thousands) | 2012 | 2012 | 2011 | Q2 2012 | Q3 2011 | |||||||||||||||
Other service fees: | ||||||||||||||||||||
Debit card fees | $ | 8,772 | $ | 9,411 | $ | 13,075 | $ | (639 | ) | $ | (4,303 | ) | ||||||||
Insurance fees | 12,322 | 12,063 | 13,785 | 259 | (1,463 | ) | ||||||||||||||
Credit card fees | 14,576 | 14,268 | 13,738 | 308 | 838 | |||||||||||||||
Sale and administration of investment products | 9,511 | 9,645 | 9,915 | (134 | ) | (404 | ) | |||||||||||||
Mortgage servicing fees, net of fair value adjustments | 9,857 | 6,335 | 2,120 | 3,522 | 7,737 | |||||||||||||||
Trust fees | 3,977 | 4,069 | 4,006 | (92 | ) | (29 | ) | |||||||||||||
Processing fees | 1,406 | 1,639 | 1,684 | (233 | ) | (278 | ) | |||||||||||||
Other fees | 4,363 | 4,597 | 4,341 | (234 | ) | 22 | ||||||||||||||
Total other service fees | $ | 64,784 | $ | 62,027 | $ | 62,664 | $ | 2,757 | $ | 2,120 | ||||||||||
Nine months ended | Variance | |||||||||||||||||||
September 30, | September 30, | 2012 vs. | ||||||||||||||||||
(In thousands) | 2012 | 2011 | 2011 | |||||||||||||||||
Other service fees: | ||||||||||||||||||||
Debit card fees | $ | 27,348 | $ | 39,795 | $ | (12,447 | ) | |||||||||||||
Insurance fees | 36,775 | 37,919 | (1,144 | ) | ||||||||||||||||
Credit card fees | 41,403 | 36,106 | 5,297 | |||||||||||||||||
Sale and administration of investment products | 28,045 | 24,702 | 3,343 | |||||||||||||||||
Mortgage servicing fees, net of fair value adjustments | 29,123 | 10,649 | 18,474 | |||||||||||||||||
Trust fees | 12,127 | 11,611 | 516 | |||||||||||||||||
Processing fees | 4,819 | 5,121 | (302 | ) | ||||||||||||||||
Other fees | 13,210 | 13,720 | (510 | ) | ||||||||||||||||
Total other service fees | $ | 192,850 | $ | 179,623 | $ | 13,227 | ||||||||||||||
Popular, Inc. | |||||||||||||||||
Financial Supplement to Third Quarter 2012 Earnings Release | |||||||||||||||||
Table G - Loans and Deposits | |||||||||||||||||
(Unaudited) | |||||||||||||||||
Loans - Ending Balances | |||||||||||||||||
Variance | |||||||||||||||||
(In thousands) | September 30, 2012 | June 30, 2012 | September 30, 2011 | Q3 2012 vs. Q2 2012 | Q3 2012 vs. Q3 2011 | ||||||||||||
Loans not covered under FDIC loss sharing agreements: | |||||||||||||||||
Commercial | $ | 9,628,631 | $ | 9,602,815 | $ | 9,989,114 | $ | 25,816 | $ | (360,483 | ) | ||||||
Construction | 258,453 | 249,743 | 253,208 | 8,710 | 5,245 | ||||||||||||
Legacy [1] | 465,848 | 509,829 | 722,600 | (43,981 | ) | (256,752 | ) | ||||||||||
Lease financing | 538,014 | 537,917 | 553,125 | 97 | (15,111 | ) | |||||||||||
Mortgage | 6,022,422 | 5,899,973 | 5,466,503 | 122,449 | 555,919 | ||||||||||||
Consumer | 3,840,485 | 3,865,532 | 3,689,336 | (25,047 | ) | 151,149 | |||||||||||
Total non-covered loans held-in-portfolio | $ | 20,753,853 | $ | 20,665,809 | $ | 20,673,886 | $ | 88,044 | $ | 79,967 | |||||||
Loans covered under FDIC loss sharing agreements | 3,903,867 | 4,016,330 | 4,512,423 | (112,463 | ) | (608,556 | ) | ||||||||||
Total loans held-in-portfolio | $ | 24,657,720 | $ | 24,682,139 | $ | 25,186,309 | $ | (24,419 | ) | $ | (528,589 | ) | |||||
Loans held-for-sale: | |||||||||||||||||
Commercial | $ | 17,696 | $ | 18,072 | $ | 24,191 | $ | (376 | ) | $ | (6,495 | ) | |||||
Construction | 88,030 | 160,102 | 234,336 | (72,072 | ) | (146,306 | ) | ||||||||||
Legacy [1] | 3,107 | 425 | - | 2,682 | 3,107 | ||||||||||||
Mortgage | 228,216 | 185,938 | 110,250 | 42,278 | 117,966 | ||||||||||||
Total loans held-for-sale | 337,049 | 364,537 | 368,777 | (27,488 | ) | (31,728 | ) | ||||||||||
Total loans | $ | 24,994,769 | $ | 25,046,676 | $ | 25,555,086 | $ | (51,907 | ) | $ | (560,317 | ) | |||||
[1] The legacy portfolio is comprised of commercial loans, construction loans and lease financings related to certain lending products exited by the Corporation as part of restructuring efforts carried out in prior years at the BPNA reportable segment. | |||||||||||||||||
Deposits - Ending Balances | |||||||||||||||||
Variance | |||||||||||||||||
(In thousands) | September 30, 2012 | June 30, 2012 | September 30, 2011 | Q3 2012 vs. Q2 2012 | Q3 2012 vs. Q3 2011 | ||||||||||||
Demand deposits [1] | $ | 6,091,400 | $ | 6,379,289 | $ | 6,149,514 | $ | (287,889 | ) | $ | (58,114 | ) | |||||
Savings, NOW and money market deposits (non-brokered) | 11,046,595 | 11,031,476 | 10,787,782 | 15,119 | 258,813 | ||||||||||||
Savings, NOW and money market deposits (brokered) | 455,309 | 433,694 | 100,002 | 21,615 | 355,307 | ||||||||||||
Time deposits (non-brokered) | 6,614,153 | 6,950,063 | 8,005,247 | (335,910 | ) | (1,391,094 | ) | ||||||||||
Time deposits (brokered CDs) | 2,112,042 | 2,620,258 | 2,910,795 | (508,216 | ) | (798,753 | ) | ||||||||||
Total deposits | $ | 26,319,499 | $ | 27,414,780 | $ | 27,953,340 | $ | (1,095,281 | ) | $ | (1,633,841 | ) | |||||
[1] Includes interest and non-interest bearing deposits. | |||||||||||||||||
Popular, Inc. | |||||||||||||||||||||||||||||
Financial Supplement to Third Quarter 2012 Earnings Release | |||||||||||||||||||||||||||||
Table H - Non-Performing Assets | |||||||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||||||
Variance | |||||||||||||||||||||||||||||
(Dollars in thousands) | September 30, 2012 | As a percentage of loans HIP by category | June 30, 2012 | As a percentage of loans HIP by category | September 30, 2011 | As a percentage of loans HIP by category | Q3 2012 vs. Q2 2012 | Q3 2012 vs. Q3 2011 | |||||||||||||||||||||
Non-accrual loans: | |||||||||||||||||||||||||||||
Commercial | $ | 772,217 | 8.0 | % | $ | 767,940 | 8.0 | % | $ | 833,565 | 8.3 | % | $ | 4,277 | $ | (61,348 | ) | ||||||||||||
Construction | 49,933 | 19.3 | 67,538 | 27.0 | 122,844 | 48.5 | (17,605 | ) | (72,911 | ) | |||||||||||||||||||
Legacy [1] | 48,735 | 10.5 | 54,730 | 10.7 | 104,314 | 14.4 | (5,995 | ) | (55,579 | ) | |||||||||||||||||||
Lease financing | 4,837 | 0.9 | 5,046 | 0.9 | 3,966 | 0.7 | (209 | ) | 871 | ||||||||||||||||||||
Mortgage | 632,052 | 10.5 | 632,899 | 10.7 | 617,723 | 11.3 | (847 | ) | 14,329 | ||||||||||||||||||||
Consumer | 42,726 | 1.1 | 34,665 | 0.9 | 49,259 | 1.3 | 8,061 | (6,533 | ) | ||||||||||||||||||||
Total non-performing loans held-in-portfolio, excluding covered loans |
|||||||||||||||||||||||||||||
1,550,500 | 7.5 | % | 1,562,818 | 7.6 | % | 1,731,671 | 8.4 | % | (12,318 | ) | (181,171 | ) | |||||||||||||||||
Non-performing loans held-for-sale [2] | 108,886 | 178,652 | 259,776 | (69,766 | ) | (150,890 | ) | ||||||||||||||||||||||
Other real estate owned (“OREO”), excluding covered OREO |
|||||||||||||||||||||||||||||
252,024 | 226,629 | 175,785 | 25,395 | 76,239 | |||||||||||||||||||||||||
Total non-performing assets, excluding covered assets | |||||||||||||||||||||||||||||
1,911,410 | 1,968,099 | 2,167,232 | (56,689 | ) | (255,822 | ) | |||||||||||||||||||||||
Covered loans and OREO | 208,235 | 209,793 | 86,301 | (1,558 | ) | 121,934 | |||||||||||||||||||||||
Total non-performing assets | $ | 2,119,645 | $ | 2,177,892 | $ | 2,253,533 | $ | (58,247 | ) | $ | (133,888 | ) | |||||||||||||||||
Accruing loans past due 90 days or more [3] | $ | 379,051 | $ | 322,893 | $ | 329,473 | $ | 56,158 | $ | 49,578 | |||||||||||||||||||
Ratios excluding covered loans: | |||||||||||||||||||||||||||||
Non-performing loans held-in-portfolio to loans held-in-portfolio | |||||||||||||||||||||||||||||
7.47 |
% |
|
7.56 | % | 8.38 | % | |||||||||||||||||||||||
Allowance for loan losses to loans held-in-portfolio | |||||||||||||||||||||||||||||
3.07 | 3.14 | 3.35 | |||||||||||||||||||||||||||
Allowance for loan losses to non-performing loans, excluding held-for-sale | |||||||||||||||||||||||||||||
41.04 | 41.50 | 39.99 | |||||||||||||||||||||||||||
Ratios including covered loans: | |||||||||||||||||||||||||||||
Non-performing loans held-in-portfolio to loans held-in-portfolio | |||||||||||||||||||||||||||||
6.62 |
% |
|
6.67 | % | 6.92 | % | |||||||||||||||||||||||
Allowance for loan losses to loans held-in-portfolio | |||||||||||||||||||||||||||||
3.09 | 3.10 | 3.07 | |||||||||||||||||||||||||||
Allowance for loan losses to non-performing loans, excluding held-for-sale | 46.61 | 46.50 | 44.35 | ||||||||||||||||||||||||||
[1] The legacy portfolio is comprised of commercial loans, construction loans and lease financings related to certain lending products exited by the Corporation as part of restructuring efforts carried out in prior years at the BPNA reportable segment. | |||||||||||||||||||||||||||||
[2] Non-performing loans held-for-sale as of September 30, 2012 consisted of $88 million in construction loans, $18 million in commercial loans, $3 million in legacy loans and $53 thousand in mortgage loans (June 30, 2012 - $160 million in construction loans, $18 million in commercial loans, $425 thousand in legacy loans and $53 thousand in mortgage loans; September 30, 2011 - $235 million in construction loans, $24 million in commercial loans, and $1 million in mortgage loans). | |||||||||||||||||||||||||||||
[3] It is the Corporation’s policy to report delinquent residential mortgage loans insured by FHA or guaranteed by the VA as accruing loans past due 90 days or more as opposed to nonperforming since the principal repayment is insured. These balances include $82 million of residential mortgage loans insured by FHA or guaranteed by the VA that are no longer accruing interest as of September 30, 2012. | |||||||||||||||||||||||||||||
Popular, Inc. | |||||||||||||||||||||||||
Financial Supplement to Third Quarter 2012 Earnings Release | |||||||||||||||||||||||||
Table I - Activity in Non-Performing Loans | |||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||
Commercial loans held-in-portfolio: | |||||||||||||||||||||||||
Quarter ended September 30, 2012 | Quarter ended June 30, 2012 | ||||||||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||||||||
Beginning balance NPLs | $ | 591,792 | $ | 176,148 | $ | 767,940 | $ | 620,916 | $ | 197,762 | $ | 818,678 | |||||||||||||
Plus: | |||||||||||||||||||||||||
New non-performing loans | 95,836 | 32,395 | 128,231 | 63,963 | 31,317 | 95,280 | |||||||||||||||||||
Advances on existing non-performing loans | - | 525 | 525 | - | 145 | 145 | |||||||||||||||||||
Loans transferred from held-for-sale | - | - | - | - | 4,933 | 4,933 | |||||||||||||||||||
Other | 1,139 | - | 1,139 | - | - | - | |||||||||||||||||||
Less: | |||||||||||||||||||||||||
Non-performing loans transferred to OREO | (4,217 | ) | (10,558 | ) | (14,775 | ) | (10,043 | ) | (16,633 | ) | (26,676 | ) | |||||||||||||
Non-performing loans charged-off | (43,711 | ) | (9,261 | ) | (52,972 | ) | (36,698 | ) | (15,385 | ) | (52,083 | ) | |||||||||||||
Loans returned to accrual status / loan collections | (28,058 | ) | (25,561 | ) | (53,619 | ) | (46,346 | ) | (25,224 | ) | (71,570 | ) | |||||||||||||
Loans transferred to held-for-sale | - | (4,252 | ) | (4,252 | ) | - | (767 | ) | (767 | ) | |||||||||||||||
Ending balance NPLs | $ | 612,781 | $ | 159,436 | $ | 772,217 | $ | 591,792 | $ | 176,148 | $ | 767,940 | |||||||||||||
Construction loans held-in-portfolio: | |||||||||||||||||||||||||
Quarter ended September 30, 2012 | Quarter ended June 30, 2012 | ||||||||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||||||||
Beginning balance NPLs | $ | 55,534 | $ | 12,004 | $ | 67,538 | $ | 56,247 | $ | 13,223 | $ | 69,470 | |||||||||||||
Plus: | |||||||||||||||||||||||||
New non-performing loans | 3,917 | - | 3,917 | 833 | - | 833 | |||||||||||||||||||
Advances on existing non-performing loans | - | 136 | 136 | 145 | 204 | 349 | |||||||||||||||||||
Less: | |||||||||||||||||||||||||
Non-performing loans transferred to OREO | (280 | ) | - | (280 | ) | - | - | - | |||||||||||||||||
Non-performing loans charged-off | (1,366 | ) | - | (1,366 | ) | (1,000 | ) | - | (1,000 | ) | |||||||||||||||
Loans returned to accrual status / loan collections | (18,873 | ) | - | (18,873 | ) | (691 | ) | (1,423 | ) | (2,114 | ) | ||||||||||||||
Loans transferred to held-for-sale | - | - | - | - | - | - | |||||||||||||||||||
Other | (1,139 | ) | - | (1,139 | ) | - | - | - | |||||||||||||||||
Ending balance NPLs | $ | 37,793 | $ | 12,140 | $ | 49,933 | $ | 55,534 | $ | 12,004 | $ | 67,538 | |||||||||||||
Mortgage loans held-in-portfolio: | |||||||||||||||||||||||||
Quarter ended September 30, 2012 | Quarter ended June 30, 2012 | ||||||||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||||||||
Beginning balance NPLs | $ | 600,082 | $ | 32,817 | $ | 632,899 | $ | 633,517 | $ | 33,700 | $ | 667,217 | |||||||||||||
Plus: | |||||||||||||||||||||||||
New non-performing loans | 157,114 | 9,457 | 166,571 | 165,483 | 6,476 | 171,959 | |||||||||||||||||||
Less: | |||||||||||||||||||||||||
Non-performing loans transferred to OREO | (19,522 | ) | (1,858 | ) | (21,380 | ) | (19,423 | ) | (3,107 | ) | (22,530 | ) | |||||||||||||
Non-performing loans charged-off | (12,811 | ) | (2,541 | ) | (15,352 | ) | (20,575 | ) | (2,128 | ) | (22,703 | ) | |||||||||||||
Loans returned to accrual status / loan collections | (126,340 | ) | (4,346 | ) | (130,686 | ) | (158,920 | ) | (2,124 | ) | (161,044 | ) | |||||||||||||
Ending balance NPLs | $ | 598,523 | $ | 33,529 | $ | 632,052 | $ | 600,082 | $ | 32,817 | $ | 632,899 | |||||||||||||
Legacy loans held-in-portfolio: | |||||||||||||||||||||||||
Quarter ended September 30, 2012 | Quarter ended June 30, 2012 | ||||||||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||||||||
Beginning balance NPLs | $ | - | $ | 54,730 | $ | 54,730 | $ | - | $ | 79,077 | $ | 79,077 | |||||||||||||
Plus: | |||||||||||||||||||||||||
New non-performing loans | - | 9,011 | 9,011 | - | 8,355 | 8,355 | |||||||||||||||||||
Advances on existing non-performing loans | - | - | - | - | 1 | 1 | |||||||||||||||||||
Less: | |||||||||||||||||||||||||
Non-performing loans transferred to OREO | - | - | - | - | (65 | ) | (65 | ) | |||||||||||||||||
Non-performing loans charged-off | - | (7,900 | ) | (7,900 | ) | - | (8,271 | ) | (8,271 | ) | |||||||||||||||
Loans returned to accrual status / loan collections | - | (4,405 | ) | (4,405 | ) | - | (9,797 | ) | (9,797 | ) | |||||||||||||||
Loans transferred to held-for-sale | - | (2,701 | ) | (2,701 | ) | - | (14,570 | ) | (14,570 | ) | |||||||||||||||
Ending balance NPLs | $ | - | $ | 48,735 | $ | 48,735 | $ | - | $ | 54,730 | $ | 54,730 | |||||||||||||
Popular, Inc. | ||||||||||||||||||||||||||||||||||||||||||
Financial Supplement to Third Quarter 2012 Earnings Release | ||||||||||||||||||||||||||||||||||||||||||
Table J - Allowance for Credit Losses, Net Charge-offs and Related Ratios | ||||||||||||||||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||||||||||||||||
Quarter ended | Quarter ended | Quarter ended | ||||||||||||||||||||||||||||||||||||||||
September 30, | June 30, | September 30, | ||||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | 2012 | 2012 | 2012 | 2012 | 2012 | 2012 | 2011 | 2011 | 2011 | |||||||||||||||||||||||||||||||||
Non-covered loans | Covered loans | Total | Non-covered loans | Covered loans | Total | Non-covered loans | Covered loans | Total | ||||||||||||||||||||||||||||||||||
Balance at beginning of period | $ | 648,535 | $ | 117,495 | $ | 766,030 | $ | 664,768 | $ | 138,496 | $ | 803,264 | $ | 689,678 | $ | 57,169 | $ | 746,847 | ||||||||||||||||||||||||
Provision for loan losses | 83,589 | 22,619 | 106,208 | 81,743 | 37,456 | 119,199 | 150,703 | 25,573 | 176,276 | |||||||||||||||||||||||||||||||||
732,124 | 140,114 | 872,238 | 746,511 | 175,952 | 922,463 | 840,381 | 82,742 | 923,123 | ||||||||||||||||||||||||||||||||||
Net loans charged-off (recovered): | ||||||||||||||||||||||||||||||||||||||||||
BPPR | ||||||||||||||||||||||||||||||||||||||||||
Commercial | 37,019 | 7,013 | 44,032 | 28,564 | 34,652 | 63,216 | 58,508 | 1,278 | 59,786 | |||||||||||||||||||||||||||||||||
Construction | (527 | ) | 7,483 | 6,956 | 985 | 15,187 | 16,172 | (81 | ) | (1,500 | ) | (1,581 | ) | |||||||||||||||||||||||||||||
Lease financing | 265 | - | 265 | 8 | - | 8 | 401 | - | 401 | |||||||||||||||||||||||||||||||||
Mortgage | 12,431 | 736 | 13,167 | 14,810 | 4,085 | 18,895 | 7,560 | 65 | 7,625 | |||||||||||||||||||||||||||||||||
Consumer | 21,853 | 9 | 21,862 | 23,055 | 4,533 | 27,588 | 23,278 | 2,478 | 25,756 | |||||||||||||||||||||||||||||||||
Total BPPR | 71,041 | 15,241 | 86,282 | 67,422 | 58,457 | 125,879 | 89,666 | 2,321 | 91,987 | |||||||||||||||||||||||||||||||||
BPNA | ||||||||||||||||||||||||||||||||||||||||||
Commercial | 9,611 | - | 9,611 | 11,132 | - | 11,132 | 17,115 | - | 17,115 | |||||||||||||||||||||||||||||||||
Construction | - | - | - | (4 | ) | - | (4 | ) | 586 | - | 586 | |||||||||||||||||||||||||||||||
Lease financing | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||
Legacy [1] | 3,952 | - | 3,952 | 5,459 | - | 5,459 | 8,881 | - | 8,881 | |||||||||||||||||||||||||||||||||
Mortgage | 3,541 | - | 3,541 | 3,371 | - | 3,371 | 6,086 | - | 6,086 | |||||||||||||||||||||||||||||||||
Consumer | 7,646 | - | 7,646 | 10,596 | - | 10,596 | 12,841 | - | 12,841 | |||||||||||||||||||||||||||||||||
Total BPNA | 24,750 | - | 24,750 | 30,554 | - | 30,554 | 45,509 | - | 45,509 | |||||||||||||||||||||||||||||||||
Total loans charged-off (recovered) - Popular, Inc. | 95,791 | 15,241 | 111,032 | 97,976 | 58,457 | 156,433 | 135,175 | 2,321 | 137,496 | |||||||||||||||||||||||||||||||||
Net write-downs (recoveries) related to loans transferred to loans held-for-sale | 34 | - | 34 | - | - | - | 12,706 | - | 12,706 | |||||||||||||||||||||||||||||||||
Balance at end of period | $ | 636,299 | $ | 124,873 | $ | 761,172 | $ | 648,535 | $ | 117,495 | $ | 766,030 | $ | 692,500 | $ | 80,421 | $ | 772,921 | ||||||||||||||||||||||||
POPULAR, INC. | ||||||||||||||||||||||||||||||||||||||||||
Annualized net charge-offs to average loans held-in-portfolio | ||||||||||||||||||||||||||||||||||||||||||
1.87 | % | 1.82 | % | 1.93 | % | 2.56 | % | 2.64 | % | 2.20 | % | |||||||||||||||||||||||||||||||
Provision for loan losses to net charge-offs | 0.87 | x | 0.96 | x | 0.83 | x | 0.76 | x | 1.11 | x | 1.28 | x | ||||||||||||||||||||||||||||||
BPPR | ||||||||||||||||||||||||||||||||||||||||||
Annualized net charge-offs to average loans held-in-portfolio | ||||||||||||||||||||||||||||||||||||||||||
1.92 | % | 1.84 | % | 1.85 | % | 2.69 | % | 2.49 | % | 1.94 | % | |||||||||||||||||||||||||||||||
Provision for loan losses to net charge-offs | 0.98 | x | 1.07 | x | 0.99 | x | 0.83 | x | 1.46 | x | 1.70 | x | ||||||||||||||||||||||||||||||
BPNA | ||||||||||||||||||||||||||||||||||||||||||
Annualized net charge-offs to average loans held-in-portfolio | ||||||||||||||||||||||||||||||||||||||||||
1.74 | % | 2.15 | % | 3.00 | % | |||||||||||||||||||||||||||||||||||||
Provision for loan losses to net charge-offs | 0.56 | x | 0.50 | x | 0.43 | x | ||||||||||||||||||||||||||||||||||||
[1] The legacy portfolio is comprised of commercial loans, construction loans and lease financings related to certain lending products exited by the Corporation as part of restructuring efforts carried out in prior years at the BPNA reportable segment. | ||||||||||||||||||||||||||||||||||||||||||
Popular, Inc. | |||||||||||||||||||||||||||||||||||
Financial Supplement to Third Quarter 2012 Earnings Release | |||||||||||||||||||||||||||||||||||
Table K - Allowance for Loan Losses - Breakdown of General and Specific Reserves - CONSOLIDATED | |||||||||||||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||||||||||||
September 30, 2012 | |||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Construction | Legacy [3] | Mortgage | Lease financing | Consumer | Total | [2] | |||||||||||||||||||||||||||
Specific ALLL | $ | 22,239 | $ | 191 | $ | - | $ | 62,823 | $ | 978 | $ | 21,193 | $ | 107,424 | |||||||||||||||||||||
Impaired loans | [1] | $ | 497,024 | $ | 47,897 | $ | 24,276 | $ | 560,441 | $ | 4,933 | $ | 135,204 | $ | 1,269,775 | ||||||||||||||||||||
Specific ALLL to impaired loans | [1] | 4.47 | % | 0.40 | % | - | % | 11.21 | % | 19.83 | % | 15.67 | % | 8.46 | % | ||||||||||||||||||||
General ALLL | $ | 263,769 | $ | 8,945 | $ | 39,871 | $ | 92,009 | $ | 1,603 | $ | 122,678 | $ | 528,875 | |||||||||||||||||||||
Loans held-in-portfolio, excluding impaired loans | [1] | $ | 9,131,607 | $ | 210,556 | $ | 441,572 | $ | 5,461,981 | $ | 533,081 | $ | 3,705,281 | $ | 19,484,078 | ||||||||||||||||||||
General ALLL to loans held-in-portfolio, excluding impaired loans | [1] | 2.89 | % | 4.25 | % | 9.03 | % | 1.68 | % | 0.30 | % | 3.31 | % | 2.71 | % | ||||||||||||||||||||
Total ALLL | $ | 286,008 | $ | 9,136 | $ | 39,871 | $ | 154,832 | $ | 2,581 | $ | 143,871 | $ | 636,299 | |||||||||||||||||||||
Total non-covered loans held-in-portfolio | [1] | $ | 9,628,631 | $ | 258,453 | $ | 465,848 | $ | 6,022,422 | $ | 538,014 | $ | 3,840,485 | $ | 20,753,853 | ||||||||||||||||||||
ALLL to loans held-in-portfolio | [1] | 2.97 | % | 3.53 | % | 8.56 | % | 2.57 | % | 0.48 | % | 3.75 | % | 3.07 | % | ||||||||||||||||||||
[1] Excludes covered loans acquired on the Westernbank FDIC-assisted transaction. | |||||||||||||||||||||||||||||||||||
[2] Excludes covered loans acquired on the Westernbank FDIC-assisted transaction. As of September 30, 2012, the general allowance on the covered loans amounted to $110 million, while the specific reserve amounted to $15 million. | |||||||||||||||||||||||||||||||||||
[3] The legacy portfolio is comprised of commercial loans, construction loans and lease financings related to certain lending products exited by the Corporation as part of restructuring efforts carried out in prior years at the BPNA reportable segment. | |||||||||||||||||||||||||||||||||||
June 30, 2012 | |||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Construction | Legacy | Mortgage | Lease financing | Consumer | Total | [2] | |||||||||||||||||||||||||||
Specific ALLL | $ | 6,830 | $ | 434 | $ | 99 | $ | 59,723 | $ | 766 | $ | 19,656 | $ | 87,508 | |||||||||||||||||||||
Impaired loans | [1] | $ | 495,032 | $ | 61,007 | $ | 29,289 | $ | 510,659 | $ | 5,528 | $ | 133,857 | $ | 1,235,372 | ||||||||||||||||||||
Specific ALLL to impaired loans | [1] | 1.38 | % | 0.71 | % | 0.34 | % | 11.70 | % | 13.86 | % | 14.68 | % | 7.08 | % | ||||||||||||||||||||
General ALLL | $ | 289,934 | $ | 8,708 | $ | 43,912 | $ | 90,099 | $ | 2,191 | $ | 126,183 | $ | 561,027 | |||||||||||||||||||||
Loans held-in-portfolio, excluding impaired loans | [1] | $ | 9,107,783 | $ | 188,736 | $ | 480,540 | $ | 5,389,314 | $ | 532,389 | $ | 3,731,675 | $ | 19,430,437 | ||||||||||||||||||||
General ALLL to loans held-in-portfolio, excluding impaired loans | [1] | 3.18 | % | 4.61 | % | 9.14 | % | 1.67 | % | 0.41 | % | 3.38 | % | 2.89 | % | ||||||||||||||||||||
Total ALLL | $ | 296,764 | $ | 9,142 | $ | 44,011 | $ | 149,822 | $ | 2,957 | $ | 145,839 | $ | 648,535 | |||||||||||||||||||||
Total non-covered loans held-in-portfolio | [1] | $ | 9,602,815 | $ | 249,743 | $ | 509,829 | $ | 5,899,973 | $ | 537,917 | $ | 3,865,532 | $ | 20,665,809 | ||||||||||||||||||||
ALLL to loans held-in-portfolio | [1] | 3.09 | % | 3.66 | % | 8.63 | % | 2.54 | % | 0.55 | % | 3.77 | % | 3.14 | % | ||||||||||||||||||||
[1] Excludes covered loans acquired on the Westernbank FDIC-assisted transaction. | |||||||||||||||||||||||||||||||||||
[2] Excludes covered loans acquired on the Westernbank FDIC-assisted transaction. As of June 30, 2012, the general allowance on the covered loans amounted to $103 million, while the specific reserve amounted to $14 million. | |||||||||||||||||||||||||||||||||||
[3] The legacy portfolio is comprised of commercial loans, construction loans and lease financings related to certain lending products exited by the Corporation as part of restructuring efforts carried out in prior years at the BPNA reportable segment. | |||||||||||||||||||||||||||||||||||
Variance September 30, 2012 versus June 30, 2012 | |||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Construction | Legacy | Mortgage | Lease financing | Consumer | Total | ||||||||||||||||||||||||||||
Specific ALLL | $ | 15,409 | $ | (243 | ) | $ | (99 | ) | $ | 3,100 | $ | 212 | $ | 1,537 | $ | 19,916 | |||||||||||||||||||
Impaired loans | $ | 1,992 | $ | (13,110 | ) | $ | (5,013 | ) | $ | 49,782 | $ | (595 | ) | $ | 1,347 | $ | 34,403 | ||||||||||||||||||
General ALLL | $ | (26,165 | ) | $ | 237 | $ | (4,041 | ) | $ | 1,910 | $ | (588 | ) | $ | (3,505 | ) | $ | (32,152 | ) | ||||||||||||||||
Loans held-in-portfolio, excluding impaired loans | $ | 23,824 | $ | 21,820 | $ | (38,968 | ) | $ | 72,667 | $ | 692 | $ | (26,394 | ) | $ | 53,641 | |||||||||||||||||||
Total ALLL | $ | (10,756 | ) | $ | (6 | ) | $ | (4,140 | ) | $ | 5,010 | $ | (376 | ) | $ | (1,968 | ) | $ | (12,236 | ) | |||||||||||||||
Total non-covered loans held-in-portfolio | $ | 25,816 | $ | 8,710 | $ | (43,981 | ) | $ | 122,449 | $ | 97 | $ | (25,047 | ) | $ | 88,044 | |||||||||||||||||||
Popular, Inc. | |||||||||||||||||||||||||
Financial Supplement to Third Quarter 2012 Earnings Release | |||||||||||||||||||||||||
Table L - Allowance for Loan Losses - Breakdown of General and Specific Reserves - PUERTO RICO OPERATIONS | |||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||
As of September 30, 2012 | |||||||||||||||||||||||||
Puerto Rico | |||||||||||||||||||||||||
(In thousands) | Commercial | Construction | Mortgage | Lease financing | Consumer | Total | |||||||||||||||||||
Allowance for credit losses: | |||||||||||||||||||||||||
Specific ALLL non-covered loans | $ | 21,246 | $ | 191 | $ | 47,523 | $ | 978 | $ | 21,070 | $ | 91,008 | |||||||||||||
General ALLL non-covered loans | 180,178 | 7,208 | 77,567 | 1,603 | 87,690 | 354,246 | |||||||||||||||||||
ALLL - non-covered loans | 201,424 | 7,399 | 125,090 | 2,581 | 108,760 | 445,254 | |||||||||||||||||||
Specific ALLL covered loans | 15,294 | - | - | - | - | 15,294 | |||||||||||||||||||
General ALLL covered loans | 64,326 | 27,223 | 12,886 | - | 5,144 | 109,579 | |||||||||||||||||||
ALLL - covered loans | 79,620 | 27,223 | 12,886 | - | 5,144 | 124,873 | |||||||||||||||||||
Total ALLL | $ | 281,044 | $ | 34,622 | $ | 137,976 | $ | 2,581 | $ | 113,904 | $ | 570,127 | |||||||||||||
Loans held-in-portfolio: | |||||||||||||||||||||||||
Impaired non-covered loans | $ | 404,175 | $ | 35,757 | $ | 506,723 | $ | 4,933 | $ | 132,472 | $ | 1,084,060 | |||||||||||||
Non-covered loans held-in-portfolio, excluding impaired loans | 5,779,640 | 174,999 | 4,412,162 | 533,081 | 3,059,817 | 13,959,699 | |||||||||||||||||||
Non-covered loans held-in-portfolio | 6,183,815 | 210,756 | 4,918,885 | 538,014 | 3,192,289 | 15,043,759 | |||||||||||||||||||
Impaired covered loans | 120,510 | - | - | - | - | 120,510 | |||||||||||||||||||
Covered loans held-in-portfolio, excluding impaired loans | 2,203,852 | 393,101 | 1,106,851 | - | 79,553 | 3,783,357 | |||||||||||||||||||
Covered loans held-in-portfolio | 2,324,362 | 393,101 | 1,106,851 | - | 79,553 | 3,903,867 | |||||||||||||||||||
Total loans held-in-portfolio | $ | 8,508,177 | $ | 603,857 | $ | 6,025,736 | $ | 538,014 | $ | 3,271,842 | $ | 18,947,626 | |||||||||||||
As of June 30, 2012 | |||||||||||||||||||||||||
Puerto Rico | |||||||||||||||||||||||||
(In thousands) | Commercial | Construction | Mortgage | Lease financing | Consumer | Total | |||||||||||||||||||
Allowance for credit losses: | |||||||||||||||||||||||||
Specific ALLL non-covered loans | $ | 5,497 | $ | 434 | $ | 44,708 | $ | 766 | $ | 19,564 | $ | 70,969 | |||||||||||||
General ALLL non-covered loans | 198,349 | 7,030 | 75,631 | 2,191 | 92,387 | 375,588 | |||||||||||||||||||
ALLL - non-covered loans | 203,846 | 7,464 | 120,339 | 2,957 | 111,951 | 446,557 | |||||||||||||||||||
Specific ALLL covered loans | 14,278 | - | - | - | - | 14,278 | |||||||||||||||||||
General ALLL covered loans | 61,314 | 23,628 | 11,617 | - | 6,658 | 103,217 | |||||||||||||||||||
ALLL - covered loans | 75,592 | 23,628 | 11,617 | - | 6,658 | 117,495 | |||||||||||||||||||
Total ALLL | $ | 279,438 | $ | 31,092 | $ | 131,956 | $ | 2,957 | $ | 118,609 | $ | 564,052 | |||||||||||||
Loans held-in-portfolio: | |||||||||||||||||||||||||
Impaired non-covered loans | $ | 378,660 | $ | 49,003 | $ | 457,359 | $ | 5,528 | $ | 131,495 | $ | 1,022,045 | |||||||||||||
Non-covered loans held-in-portfolio, excluding impaired loans | 5,784,620 | 152,761 | 4,356,862 | 532,389 | 3,067,554 | 13,894,186 | |||||||||||||||||||
Non-covered loans held-in-portfolio | 6,163,280 | 201,764 | 4,814,221 | 537,917 | 3,199,049 | 14,916,231 | |||||||||||||||||||
Impaired covered loans | 76,695 | - | - | - | - | 76,695 | |||||||||||||||||||
Covered loans held-in-portfolio, excluding impaired loans | 2,254,481 | 469,765 | 1,116,476 | - | 98,913 | 3,939,635 | |||||||||||||||||||
Covered loans held-in-portfolio | 2,331,176 | 469,765 | 1,116,476 | - | 98,913 | 4,016,330 | |||||||||||||||||||
Total loans held-in-portfolio | $ | 8,494,456 | $ | 671,529 | $ | 5,930,697 | $ | 537,917 | $ | 3,297,962 | $ | 18,932,561 | |||||||||||||
Variance September 30, 2012 versus June 30, 2012 | |||||||||||||||||||||||||
(In thousands) | Commercial | Construction | Mortgage | Lease financing | Consumer | Total | |||||||||||||||||||
Allowance for credit losses: | |||||||||||||||||||||||||
Specific ALLL non-covered loans | $ | 15,749 | $ | (243 | ) | $ | 2,815 | $ | 212 | $ | 1,506 | $ | 20,039 | ||||||||||||
General ALLL non-covered loans | (18,171 | ) | 178 | 1,936 | (588 | ) | (4,697 | ) | (21,342 | ) | |||||||||||||||
ALLL - non-covered loans | (2,422 | ) | (65 | ) | 4,751 | (376 | ) | (3,191 | ) | (1,303 | ) | ||||||||||||||
Specific ALLL covered loans | 1,016 | - | - | - | - | 1,016 | |||||||||||||||||||
General ALLL covered loans | 3,012 | 3,595 | 1,269 | - | (1,514 | ) | 6,362 | ||||||||||||||||||
ALLL - covered loans | 4,028 | 3,595 | 1,269 | - | (1,514 | ) | 7,378 | ||||||||||||||||||
Total ALLL | $ | 1,606 | $ | 3,530 | $ | 6,020 | $ | (376 | ) | $ | (4,705 | ) | $ | 6,075 | |||||||||||
Loans held-in-portfolio: | |||||||||||||||||||||||||
Impaired non-covered loans | $ | 25,515 | $ | (13,246 | ) | $ | 49,364 | $ | (595 | ) | $ | 977 | $ | 62,015 | |||||||||||
Non-covered loans held-in-portfolio, excluding impaired loans | (4,980 | ) | 22,238 | 55,300 | 692 | (7,737 | ) | 65,513 | |||||||||||||||||
Non-covered loans held-in-portfolio | 20,535 | 8,992 | 104,664 | 97 | (6,760 | ) | 127,528 | ||||||||||||||||||
Impaired covered loans | 43,815 | - | - | - | - | 43,815 | |||||||||||||||||||
Covered loans held-in-portfolio, excluding impaired loans | (50,629 | ) | (76,664 | ) | (9,625 | ) | - | (19,360 | ) | (156,278 | ) | ||||||||||||||
Covered loans held-in-portfolio | (6,814 | ) | (76,664 | ) | (9,625 | ) | - | (19,360 | ) | (112,463 | ) | ||||||||||||||
Total loans held-in-portfolio | $ | 13,721 | $ | (67,672 | ) | $ | 95,039 | $ | 97 | $ | (26,120 | ) | $ | 15,065 | |||||||||||
Popular, Inc. | |||||||||||||||||||||||||
Financial Supplement to Third Quarter 2012 Earnings Release | |||||||||||||||||||||||||
Table M - Allowance for Loan Losses - Breakdown of General and Specific Reserves - U.S. MAINLAND OPERATIONS | |||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||
As of September 30, 2012 | |||||||||||||||||||||||||
U.S. Mainland | |||||||||||||||||||||||||
(In thousands) | Commercial | Construction | Legacy | Mortgage | Consumer | Total | |||||||||||||||||||
Allowance for credit losses: | |||||||||||||||||||||||||
Specific ALLL | $ | 993 | $ | - | $ | - | $ | 15,300 | $ | 123 | $ | 16,416 | |||||||||||||
General ALLL | 83,591 | 1,737 | 39,871 | 14,442 | 34,988 | 174,629 | |||||||||||||||||||
Total ALLL | $ | 84,584 | $ | 1,737 | $ | 39,871 | $ | 29,742 | $ | 35,111 | $ | 191,045 | |||||||||||||
Loans held-in-portfolio: | |||||||||||||||||||||||||
Impaired loans | $ | 92,849 | $ | 12,140 | $ | 24,276 | $ | 53,718 | $ | 2,732 | $ | 185,715 | |||||||||||||
Loans held-in-portfolio, excluding impaired loans | 3,351,967 | 35,557 | 441,572 | 1,049,819 | 645,464 | 5,524,379 | |||||||||||||||||||
Total loans held-in-portfolio | $ | 3,444,816 | $ | 47,697 | $ | 465,848 | $ | 1,103,537 | $ | 648,196 | $ | 5,710,094 | |||||||||||||
As of June 30, 2012 | |||||||||||||||||||||||||
U.S. Mainland | |||||||||||||||||||||||||
(In thousands) | Commercial | Construction | Legacy | Mortgage | Consumer | Total | |||||||||||||||||||
Allowance for credit losses: | |||||||||||||||||||||||||
Specific ALLL | $ | 1,333 | $ | - | $ | 99 | $ | 15,015 | $ | 92 | $ | 16,539 | |||||||||||||
General ALLL | 91,585 | 1,678 | 43,912 | 14,468 | 33,796 | 185,439 | |||||||||||||||||||
Total ALLL | $ | 92,918 | $ | 1,678 | $ | 44,011 | $ | 29,483 | $ | 33,888 | $ | 201,978 | |||||||||||||
Loans held-in-portfolio: | |||||||||||||||||||||||||
Impaired loans | $ | 116,372 | $ | 12,004 | $ | 29,289 | $ | 53,300 | $ | 2,362 | $ | 213,327 | |||||||||||||
Loans held-in-portfolio, excluding impaired loans | 3,323,163 | 35,975 | 480,540 | 1,032,452 | 664,121 | 5,536,251 | |||||||||||||||||||
Total loans held-in-portfolio | $ | 3,439,535 | $ | 47,979 | $ | 509,829 | $ | 1,085,752 | $ | 666,483 | $ | 5,749,578 | |||||||||||||
Variance September 30, 2012 versus June 30, 2012 | |||||||||||||||||||||||||
(In thousands) | Commercial | Construction | Legacy | Mortgage | Consumer | Total | |||||||||||||||||||
Allowance for credit losses: | |||||||||||||||||||||||||
Specific ALLL | $ | (340 | ) | $ | - | $ | (99 | ) | $ | 285 | $ | 31 | $ | (123 | ) | ||||||||||
General ALLL | (7,994 | ) | 59 | (4,041 | ) | (26 | ) | 1,192 | (10,810 | ) | |||||||||||||||
Total ALLL | $ | (8,334 | ) | $ | 59 | $ | (4,140 | ) | $ | 259 | $ | 1,223 | $ | (10,933 | ) | ||||||||||
Loans held-in-portfolio: | |||||||||||||||||||||||||
Impaired loans | $ | (23,523 | ) | $ | 136 | $ | (5,013 | ) | $ | 418 | $ | 370 | $ | (27,612 | ) | ||||||||||
Loans held-in-portfolio, excluding impaired loans | 28,804 | (418 | ) | (38,968 | ) | 17,367 | (18,657 | ) | (11,872 | ) | |||||||||||||||
Total loans held-in-portfolio | $ | 5,281 | $ | (282 | ) | $ | (43,981 | ) | $ | 17,785 | $ | (18,287 | ) | $ | (39,484 | ) | |||||||||
Popular, Inc. | |||||||||||||||
Financial Supplement to Third Quarter 2012 Earnings Release | |||||||||||||||
Table N - Reconciliation to GAAP Financial Measures | |||||||||||||||
(Unaudited) | |||||||||||||||
(In thousands, except share or per share information) | September 30, 2012 | June 30, 2012 | September 30, 2011 | ||||||||||||
Total stockholders’ equity | $ | 4,068,984 | $ | 4,021,237 | $ | 4,012,601 | |||||||||
Less: Preferred stock | (50,160 | ) | (50,160 | ) | (50,160 | ) | |||||||||
Less: Goodwill | (647,757 | ) | (647,757 | ) | (648,353 | ) | |||||||||
Less: Other intangibles | (56,762 | ) | (59,243 | ) | (64,212 | ) | |||||||||
Total tangible common equity | $ | 3,314,305 | $ | 3,264,077 | $ | 3,249,876 | |||||||||
Total assets | $ | 36,503,366 | $ | 36,612,179 | $ | 38,275,323 | |||||||||
Less: Goodwill | (647,757 | ) | (647,757 | ) | (648,353 | ) | |||||||||
Less: Other intangibles | (56,762 | ) | (59,243 | ) | (64,212 | ) | |||||||||
Total tangible assets | $ | 35,798,847 | $ | 35,905,179 | $ | 37,562,758 | |||||||||
Tangible common equity to tangible assets | 9.26 | % | 9.09 | % | 8.65 | % | |||||||||
Common shares outstanding at end of period [1] | 103,097,143 | 102,824,323 | 102,447,540 | ||||||||||||
Tangible book value per common share [1] | $ | 32.15 | $ | 31.74 | $ | 31.72 | |||||||||
[1] All share and per share data has been adjusted to retroactively reflect the 1-for-10 reverse stock split effected on May 29, 2012. | |||||||||||||||
(In thousands) | September 30, 2012 | June 30, 2012 | September 30, 2011 | ||||||||||||
Common stockholders’ equity | $ | 4,018,824 | $ | 3,971,077 | $ | 3,962,441 | |||||||||
Less: Unrealized gains on available-for-sale securities, net of tax | [1] | (175,769 | ) | (181,207 | ) | (209,120 | ) | ||||||||
Less: Disallowed deferred tax assets | [2] | (365,954 | ) | (392,960 | ) | (222,601 | ) | ||||||||
Less: Intangible assets: | |||||||||||||||
Goodwill | (647,757 | ) | (647,757 | ) | (648,353 | ) | |||||||||
Other disallowed intangibles | (18,409 | ) | (22,241 | ) | (31,272 | ) | |||||||||
Less: Aggregate adjusted carrying value of all non-financial equity investments | (1,154 | ) | (1,256 | ) | (1,525 | ) | |||||||||
Add: Pension liability adjustment, net of tax and accumulated net gains (losses) | |||||||||||||||
on cash flow hedges | [3] | 205,309 | 208,015 | 125,004 | |||||||||||
Total Tier 1 common equity | $ | 3,015,090 | $ | 2,933,671 | $ | 2,974,574 | |||||||||
[1] In accordance with regulatory risk-based capital guidelines, Tier 1 capital excludes net unrealized gains (losses) on available-for-sale debt securities and net unrealized gains on available-for-sale equity securities with readily determinable fair values. In arriving at Tier 1 capital, institutions are required to deduct net unrealized losses on available-for-sale equity securities with readily determinable fair values, net of tax. | |||||||||||||||
[2] Approximately $153 million of the Corporation’s $546 million of net deferred tax assets at September 30, 2012 (June 30, 2012 - $151 million and $573 million, respectively; September 30, 2011 - $126 million and $342 million, respectively), were included without limitation in regulatory capital pursuant to the risk-based capital guidelines, while approximately $366 million of such assets at September 30, 2012 (June 30, 2012 - $393 million; September 30, 2011 - $223 million) exceeded the limitation imposed by these guidelines and, as “disallowed deferred tax assets”, were deducted in arriving at Tier 1 capital. The remaining $27 million of the Corporation’s other net deferred tax assets at September 30, 2012 (June 30, 2012 - $29 million; September 30, 2011 - $7 million) represented primarily the following items (a) the deferred tax effects of unrealized gains and losses on available-for-sale debt securities, which are permitted to be excluded prior to deriving the amount of net deferred tax assets subject to limitation under the guidelines; (b) the deferred tax asset corresponding to the pension liability adjustment recorded as part of accumulated other comprehensive income; and (c) the deferred tax liability associated with goodwill and other intangibles. | |||||||||||||||
[3] The Federal Reserve Bank has granted interim capital relief for the impact of pension liability adjustment. |
Popular, Inc. | |||||||||||||||||
Financial Supplement to Third Quarter 2012 Earnings Release | |||||||||||||||||
Table O - Financial Information - Westernbank Covered Loans | |||||||||||||||||
(Unaudited) | |||||||||||||||||
Revenues |
|||||||||||||||||
Quarter ended | |||||||||||||||||
(In thousands) | September 30, 2012 | June 30, 2012 | Variance | ||||||||||||||
Interest income on covered loans | $ | 70,584 | $ | 79,094 | $ | (8,510 | ) | ||||||||||
FDIC loss share income (expense): | |||||||||||||||||
(Amortization) accretion of indemnification asset | (29,184 | ) | (37,413 | ) | 8,229 | ||||||||||||
80% mirror accounting on credit impairment losses [1] | 18,095 | 29,426 | (11,331 | ) | |||||||||||||
80% mirror accounting on discount accretion on unfunded commitments | (248 | ) | (248 | ) | - | ||||||||||||
80% mirror accounting on reimbursable expenses | 7,378 | 10,663 | (3,285 | ) | |||||||||||||
Other | (2,748 | ) | 147 | (2,895 | ) | ||||||||||||
Total FDIC loss share (expense) income | (6,707 | ) | 2,575 | (9,282 | ) | ||||||||||||
Other non-interest income | 310 | 310 | - | ||||||||||||||
Total revenues | 64,187 | 81,979 | (17,792 | ) | |||||||||||||
Provision for loan losses | 22,619 | 37,456 | (14,837 | ) | |||||||||||||
Total revenues less provision for loan losses | $ | 41,568 | $ | 44,523 | $ | (2,955 | ) | ||||||||||
[1] | Reductions in expected cash flows for ASC 310-30 loans, which may impact the provision for loan losses, may consider reductions in both principal and interest cash flow expectations. The amount covered under the FDIC loss sharing agreements for interest not collected from borrowers is limited under the agreements (approximately 90 days); accordingly, these amounts are not subject fully to the 80% mirror accounting. | ||||||||||||||||
Quarterly average assets |
|||||||||||||||||
Quarter ended | |||||||||||||||||
(In millions) | September 30, 2012 | June 30, 2012 | Variance | ||||||||||||||
Covered loans | $ | 3,952 | $ | 4,129 | $ | (177 | ) | ||||||||||
FDIC loss share asset | 1,578 | 1,700 | (122 | ) | |||||||||||||
Activity in the carrying amount and accretable yield of covered loans accounted for under ASC 310-30 |
|||||||||||||||||
Quarter ended | |||||||||||||||||
September 30, 2012 | June 30, 2012 | ||||||||||||||||
(In thousands) | Accretable yield |
Carrying amount |
Accretable |
Carrying amount |
|||||||||||||
Beginning balance | $ | 1,574,850 | $ | 3,729,489 | $ | 1,542,519 | $ | 3,894,905 | |||||||||
Accretion | (66,168 | ) | 66,168 | (73,988 | ) | 73,988 | |||||||||||
Changes in expected cash flows | (37,800 | ) | 106,319 | ||||||||||||||
Collections / charge-offs | (168,448 | ) | (239,404 | ) | |||||||||||||
Ending balance | 1,470,882 | 3,627,209 | 1,574,850 | 3,729,489 | |||||||||||||
Allowance for loan losses - ASC 310-30 covered loans | (103,547 | ) | (93,971 | ) | |||||||||||||
Ending balance, net of allowance for loan losses | $ | 1,470,882 | $ | 3,523,662 | $ | 1,574,850 | $ | 3,635,518 | |||||||||
Activity in the carrying amount of the FDIC indemnity asset |
|||||||||||||||||
Quarter ended | |||||||||||||||||
(In thousands) | September 30, 2012 | June 30, 2012 | |||||||||||||||
Balance at beginning of period | $ | 1,631,594 | $ | 1,880,357 | |||||||||||||
Amortization | (29,184 | ) | (37,413 | ) | |||||||||||||
Credit impairment losses to be covered under loss sharing agreements | 18,095 | 29,426 | |||||||||||||||
Decrease due to reciprocal accounting on the discount accretion on unfunded commitments | (248 | ) | (248 | ) | |||||||||||||
Payments received from FDIC under loss sharing agreements | (64,932 | ) | (241,911 | ) | |||||||||||||
Other adjustments attributable to FDIC loss sharing agreements | 3,732 | 1,383 | |||||||||||||||
Balance at end of period | $ | 1,559,057 | $ | 1,631,594 | |||||||||||||
Activity in the remaining FDIC loss share asset accretion (amortization) |
|||||||||||||||||
Quarter ended | |||||||||||||||||
(In thousands) | September 30, 2012 | June 30, 2012 | |||||||||||||||
Balance at beginning of period | $ | 121,308 | $ | 106,781 | |||||||||||||
Amortization | (29,184 | ) | (37,413 | ) | |||||||||||||
Impact of lower projected losses | 4,300 | 51,940 | |||||||||||||||
Balance at end of period | $ | 96,424 | $ | 121,308 | |||||||||||||
CONTACT:
Popular, Inc.
Investor Relations:
Jorge A.
Junquera, 787-754-1685
Chief Financial Officer, Senior Executive
Vice President
or
Media Relations:
Teruca Rullán, 787-281-5170
or 917-679-3596/mobile
Senior Vice President, Corporate Communications